AGREEMENT AND PLAN OF MERGER dated as of March 11, 2009 among DIN GLOBAL CORP., ENP ACQUISITION, INC. and EN POINTE TECHNOLOGIES, INC.
EXHIBIT
2.2
dated
as of March 11, 2009
among
DIN
GLOBAL CORP.,
ENP
ACQUISITION, INC.
and
EN
POINTE TECHNOLOGIES, INC.
TABLE
OF CONTENTS
Page
ARTICLE I
THE MERGER 1
| Section 1.01.The Merger |
1
|
|
| Section 1.02.Closing |
1
|
|
| Section 1.03.Effective Time |
1
|
|
| Section 1.04.Effects of the Merger |
2
|
|
| Section 1.05.Certificate of Incorporation and Bylaws of the Surviving Corporation |
2
|
|
| Section 1.06.Directors and Officers of the Surviving Corporation |
2
|
|
| Section 1.07.Further Assurances |
3
|
ARTICLE
II EFFECT OF THE MERGER ON THE CAPITAL STOCK OF THE CONSTITUENT CORPORATIONS;
EXCHANGE OF CERTIFICATES 3
|
Section
2.01.Effect on
Capital Stock
|
3
|
|
|
Section
0.00.Xxxxxxxx of
Certificates
|
4
|
|
|
Section
2.03.Stock
Options
|
7
|
II
REPRESENTATIONS AND WARRANTIES 7
|
Section
3.01.Representations and
Warranties of the Company
|
7
|
|
|
Section
3.02.Representations and
Warranties of Parent and Merger Sub
|
13
|
ARTICLE
IV COVENANTS RELATING TO CONDUCT OF BUSINESS; NO SOLICITATION 17
|
Section
4.01.Conduct of
Business by the Company
|
17
|
|
|
Section
0.00.Xx
Solicitation
|
19
|
ARTICLE V
ADDITIONAL AGREEMENTS 23
|
Section
5.01.Preparation
of the Proxy Statement and Schedule 13E-3; Stockholders’
Meeting
|
23
|
|
|
Section
5.02.Access to
Information; Confidentiality
|
25
|
|
|
Section
5.03.Reasonable
Best Efforts
|
25
|
|
|
Section
5.04.Indemnification,
Exculpation and Insurance
|
27
|
|
|
Section
5.05.Fees and
Expenses
|
29
|
|
|
Section
5.06.Public
Announcements
|
31
|
|
|
Section
5.07.Financing
|
31
|
ARTICLE
VI CONDITIONS PRECEDENT 32
|
Section
6.01.Conditions
to Each Party’s Obligation to Effect the Merger
|
32
|
|
|
Section
6.02.Conditions
to Obligations of Parent and Merger Sub
|
33
|
|
|
Section
6.03.Conditions
to Obligation of the Company
|
34
|
|
|
Section
6.04.Frustration
of Closing Conditions
|
34
|
ARTICLE
VII TERMINATION, AMENDMENT AND WAIVER
34
|
Section
7.01.Termination
|
34
|
|
|
Section
7.02.Effect of
Termination
|
35
|
|
Section
7.03.Amendment
|
36
|
|
|
Section
7.04.Extension;
Waiver
|
36
|
|
|
Section
7.05.Procedure
for Termination or Amendment
|
36
|
ARTICLE
VIII GENERAL PROVISIONS 36
|
Section
8.01.Nonsurvival
of Representations and Warranties
|
36
|
|
|
Section
8.02.Notices
|
36
|
|
|
Section
8.03.Definitions
|
37
|
|
|
Section
8.04.Interpretation
|
39
|
|
|
Section
8.05.Consents
and Approvals
|
39
|
|
|
Section
8.06.Counterparts
|
40
|
|
|
Section
8.07.Entire
Agreement; No Third-Party Beneficiaries
|
40
|
|
|
Section
8.08.Governing
Law
|
40
|
|
|
Section
8.09.Assignment
|
40
|
|
|
Section
8.10.Enforcement; Consent
to Jurisdiction
|
40
|
|
|
Section
8.11.Severability
|
41
|
|
|
Section
0.00.Xx
Recourse
|
41
|
|
|
Section
8.13.WAIVER OF
JURY TRIAL
|
41
|
Annex
I Index
of Defined Terms
This
AGREEMENT AND PLAN OF MERGER (this “Agreement”) is made
and entered into as of March 11, 2009 among Din Global Corp., a Delaware
corporation (“Parent”), ENP Acquisition, Inc., a Delaware corporation (“Merger Sub”), and En
Pointe Technologies, Inc., a Delaware corporation (the “Company”).
RECITALS
WHEREAS,
the Board of Directors of each of the Company and Merger Sub has approved and
declared advisable, and the Board of Directors of Parent has approved, this
Agreement and the merger of Merger Sub with and into the Company, with the
Company continuing as the surviving corporation in the merger (the “Merger”), upon the
terms and subject to the conditions set forth in this Agreement, whereby each
issued and outstanding share of common stock, par value $0.001 per share, of the
Company (“Company
Common Stock”), other than any Cancelled Shares held by Parent, Merger
Sub or the Company and any Appraisal Shares, will be converted into the right to
receive $2.50 in cash, without interest (the “Merger
Consideration”); and
WHEREAS,
Parent, Merger Sub and the Company desire to make certain representations,
warranties, covenants and agreements in connection with the Merger and also to
prescribe various conditions to the Merger.
AGREEMENT
NOW,
THEREFORE, in consideration of the representations, warranties, covenants and
agreements contained in this Agreement, and subject to the conditions set forth
herein, the parties hereto, intending to be legally bound hereby, agree as
follows:
ARTICLE
I
THE
MERGER
Section
1.01. The
Merger. Upon
the terms and subject to the conditions set forth in this Agreement, and in
accordance with the General Corporation Law of the State of Delaware (the “DGCL”), Merger Sub
shall be merged with and into the Company at the Effective
Time. Following the Effective Time, the separate corporate existence
of Merger Sub shall cease and the Company shall continue as the surviving
corporation in the Merger (the “Surviving
Corporation”) and shall succeed to and assume all of the rights and
obligations of Merger Sub and the Company in accordance with the
DGCL.
Section
1.02. Closing. The
closing of the Merger (the “Closing”) will take
place at 10:00 a.m. on a date to be specified by the parties, which shall be no
later than the third Business Day after satisfaction or (to the extent permitted
by applicable Law) waiver of the conditions set forth in Article VI (other than
those conditions that by their terms are to be satisfied at the Closing, but
subject to the satisfaction or (to the extent permitted by applicable Law)
waiver of those conditions), at the offices of Xxxxxx Xxxxxxxx LLP, Suite 1200,
0 Xxxx Xxxxx, Xxxxxx, Xxxxxxxxxx, unless another time, date or place is agreed
to in writing by Parent and the Company; provided, however, that if all the
conditions set forth in Article VI shall no longer
-1-
Section
1.03. Effective
Time. Subject
to the provisions of this Agreement, as soon as practicable on the Closing Date,
the parties shall file with the Secretary of State of the State of Delaware a
certificate of merger regarding the Merger (the “Certificate of
Merger”) in accordance with the relevant provisions of the DGCL and, as
soon as practicable on or after the Closing Date, shall make or cause to be made
all other filings or recordings required under the DGCL. The Merger
shall become effective upon the filing of the Certificate of Merger with the
Secretary of State of the State of Delaware, or at such later time as Parent and
the Company shall agree in writing and specify in the Certificate of Merger (the
time the Merger becomes effective being the “Effective
Time”).
Section
1.04. Effects of the
Merger. The
Merger shall have the effects set forth in this Agreement and in the
DGCL. Without limiting the generality of the foregoing and subject
thereto, at the Effective Time all of the properties, rights, privileges, powers
and franchises of the Company and Merger Sub shall vest in the Surviving
Corporation, and all debts, liabilities and duties of the Company and Merger Sub
shall become the debts, liabilities and duties of the Surviving
Corporation.
Section
1.05. Certificate of Incorporation
and Bylaws of the Surviving Corporation.
(a) The
certificate of incorporation of the Company shall be amended as of the Effective
Time as a result of the Merger so as to read in its entirety as the certificate
of incorporation of Merger Sub as in effect immediately prior to the Effective
Time, except that the name of the Surviving Corporation shall be En Pointe
Technologies, Inc., and, as so amended, shall be the Surviving Corporation’s
certificate of incorporation until thereafter changed or amended as provided
therein or by applicable Law.
(b) The
bylaws of the Company, as in effect as of immediately prior to the Effective
Time, shall be amended and restated as of the Effective Time as a result of the
Merger so as to read in their entirety as the bylaws of Merger Sub as in effect
immediately prior to the Effective Time (except the references to Merger Sub’s
name shall be replaced by references to En Pointe Technologies, Inc.) and, as so
amended and restated, shall be the Surviving Corporation’s bylaws until
thereafter changed or amended as provided therein or by applicable
Law.
Section
1.06. Directors and Officers of
the Surviving Corporation. The
directors of Merger Sub immediately prior to the Effective Time shall be the
directors of the Surviving Corporation until the earlier of their resignation or
removal or until their respective successors are duly elected and qualified, as
the case may be. The officers of the Company immediately prior to the
Effective Time shall be the officers of the Surviving Corporation until the
earlier of
-2-
Section
1.07. Further
Assurances. If
at any time after the Effective Time the Surviving Corporation shall consider or
be advised that any deeds, bills of sale, assignments or assurances or any other
acts or things are necessary, desirable or proper (a) to vest, perfect or
confirm, of record or otherwise, in the Surviving Corporation its right, title
or interest in, to or under any of the rights, privileges, powers, franchises,
properties or assets of either Merger Sub or the Company or both, or (b)
otherwise to carry out the purposes of this Agreement, the Surviving Corporation
and its proper officers and directors or their designees shall be authorized to
execute and deliver, in the name and on behalf of either Merger Sub or the
Company or both, all such deeds, bills of sale, assignments and assurances and
to do, in the name and on behalf of either Merger Sub or the Company, all such
other acts and things as may be necessary, desirable or proper to vest, perfect
or confirm the Surviving Corporation’s right, title or interest in, to or under
any of the rights, privileges, powers, franchises, properties or assets of
Merger Sub and the Company and otherwise to carry out the purposes of this
Agreement.
ARTICLE
II
EFFECT OF
THE MERGER ON THE CAPITAL STOCK OF THE CONSTITUENT CORPORATIONS; EXCHANGE OF
CERTIFICATES
Section
2.01. Effect on Capital
Stock. At
the Effective Time, by virtue of the Merger and without any action on the part
of the Parent, Merger Sub or the Company or the holder of any shares of Company
Common Stock:
(a) Capital Stock of Merger
Sub. Each share of common stock, par value $0.001 per share, of
Merger Sub that is issued and outstanding immediately prior to the Effective
Time shall be converted into one (1) share of common stock of the Surviving
Corporation.
(b) Cancellation of Certain
Stock. Each share of Company Common Stock (i) that is owned,
directly or indirectly, by Parent or Merger Sub immediately prior to the
Effective Time, or (ii) that has been reacquired by the Company and is held as
authorized but unissued Company Common Stock immediately prior to the Effective
Time (collectively, the “Cancelled Shares”),
shall automatically be canceled and shall cease to exist, and no consideration
shall be delivered in exchange therefor.
(c) Conversion of Company Common
Stock. Each share of Company Common Stock issued and
outstanding immediately prior to the Effective Time (other than any Cancelled
Shares and any Appraisal Shares) shall be converted into the right to receive
the Merger Consideration on the terms set forth in this Agreement (the “Converted
Shares”). As of the Effective Time, subject to Section
2.01(d), all of the Converted Shares shall no longer be outstanding and shall
automatically be canceled and shall cease to exist, and each holder of a
certificate which immediately prior to the Effective Time represented any such
Converted Shares (each, a “Certificate”) shall
cease to have any rights with respect thereto, except the right to receive the
Merger Consideration, without interest, to be issued or paid in consideration
therefor upon surrender of such Certificate and other required documentation in
accordance with
-3-
Section
2.02(b). The right of any holder of a Certificate to receive the
Merger Consideration shall be subject to and reduced by the amount of any
withholding that is required under applicable tax Law.
(d) Appraisal
Rights. Notwithstanding anything in this Agreement to the
contrary, shares (the “Appraisal Shares”) of
Company Common Stock issued and outstanding immediately prior to the Effective
Time that are held by any holder who is entitled to demand and properly demands
appraisal of such Appraisal Shares pursuant to, and who complies in all respects
with, the provisions of Section 262 of the DGCL (“Section 262”) shall
not be converted into the right to receive the Merger Consideration as provided
in Section 2.01(c), but instead such holder shall be entitled to payment of the
fair value of such Appraisal Shares in accordance with the provisions of Section
262. At the Effective Time, all Appraisal Shares shall no longer be
outstanding, shall automatically be canceled and shall cease to exist, and each
holder of Appraisal Shares shall cease to have any rights with respect thereto,
except the right to receive the fair value of such Appraisal Shares in
accordance with the provisions of Section 262. Notwithstanding the foregoing, if
any such holder shall fail to perfect or otherwise shall waive, withdraw or lose
the right to appraisal under Section 262, or a court of competent jurisdiction
shall determine that such holder is not entitled to the relief provided by
Section 262, then the right of such holder to be paid the fair value of such
holder’s Appraisal Shares under Section 262 shall cease and such Appraisal
Shares shall be deemed to have been converted at the Effective Time into, and
shall have become, the right to receive the Merger Consideration as provided in
Section 2.01(c). The Company shall serve prompt notice to Parent of
any demands for appraisal of any shares of Company Common Stock, and Parent
shall have the right to participate in and direct all negotiations and
proceedings with respect to such demands. Prior to the Effective
Time, the Company shall not, without the prior written consent of Parent,
voluntarily make any payment with respect to, or settle or offer to settle, any
such demands, or agree to do any of the foregoing.
(e) Certain
Adjustments. Notwithstanding anything herein to the contrary,
if between the date of this Agreement and the Effective Time, (i) the
outstanding shares of Company Common Stock shall have been changed into a
different number of shares or a different class, by reason of the occurrence or
record date of any stock dividend, subdivision, reclassification,
recapitalization, split, combination, exchange of shares or similar transaction,
(ii) a stock dividend or dividend payable in any other securities of the Company
shall be declared with a record date within such period, or (iii) any similar
event shall have occurred, then in any such case the Merger Consideration shall
be appropriately adjusted to reflect such action; provided, however that nothing
in this Section 2.01(e) shall be construed to permit the Company to take any
action with respect to its securities that is prohibited by the terms of this
Agreement.
Section
2.02. Exchange of
Certificates.
(a) Paying
Agent. Prior to the Effective Time, Parent shall designate and
enter into an agreement with a bank or trust company that is reasonably
satisfactory to the Company to act as paying agent (the “Paying Agent”) for
the payment of the Merger Consideration. Prior to the Effective Time,
Parent shall deposit, or cause the Surviving Corporation to deposit, with the
Paying Agent, for the benefit (from and after the Effective
-4-
(b) Exchange
Procedures. As soon as reasonably practicable after the
Effective Time, Parent shall cause the Paying Agent to mail to each holder of
record of a Certificate (i) a form of letter of transmittal (which shall specify
that delivery shall be effected, and risk of loss and title to the Certificates
shall pass, only upon proper delivery of the Certificates to the Paying Agent,
and which shall be in customary form and have such other provisions as Parent
may reasonably specify), and (ii) instructions for effecting the surrender of
the Certificates in exchange for the Merger Consideration. Each
holder of record of one or more Certificates shall, upon surrender to the Paying
Agent of such Certificate or Certificates, together with such letter of
transmittal, duly executed, and such other documents as may reasonably be
required by the Paying Agent, be entitled to receive in exchange therefor the
amount of cash to which such holder is entitled pursuant to Section 2.01(c), and
the Certificates so surrendered shall forthwith be canceled. In the
event of a transfer of ownership of Company Common Stock which is not registered
in the transfer records of the Company, payment of the Merger Consideration in
accordance with this Section 2.02(b) may be made 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 accompanied by all documents required to evidence and effect such
transfer) and the Person requesting such payment shall pay any transfer or other
taxes required by reason of the payment of the Merger Consideration to a Person
other than the registered holder of such Certificate. No payment of
Merger Consideration shall be paid to any holder of a Certificate with respect
to the Conversion Shares represented by such Certificate until the holder of
such Certificate shall have surrendered such Certificate in accordance with this
Article II. Until surrendered as contemplated by this Section
2.02(b), each Certificate shall be deemed at any time after the Effective Time
to represent only the right to receive the Merger Consideration to which such
holder is entitled to receive in respect of such Certificate pursuant to this
Article II. Following the surrender of any Certificate, there shall
be paid to the record holder of the Certificate representing whole shares of
Company Common Stock issued in exchange therefor, without interest, at the time
of such surrender, the Merger Consideration payable in respect therefor in
accordance with this Article II. No interest shall be paid or will
accrue on any payment to holders of Certificates pursuant to the provisions of
this Article II.
(c) No Further Ownership Rights in
Company Common Stock. The Merger Consideration paid upon the
surrender of Certificates (or affidavits in lieu thereof) 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 of Company Common Stock formerly
represented by such Certificates. At the close of business on the day
on which the Effective Time occurs, the share transfer books of the Company
shall be closed, and there shall be no further registration of transfers on the
share transfer books of the Surviving Corporation of the Converted
Shares. If, after the Effective Time, any Certificate is presented to
the Surviving Corporation or Parent for transfer, it shall be canceled against
delivery of the Merger Consideration as provided in this Article
II.
-5-
(d) Termination of the Exchange
Fund. Any portion of the Exchange Fund which remains
undistributed to the holders of the Certificates for twelve months after the
Effective Time shall be delivered to the Surviving Corporation, upon demand, and
any holders of the Certificates who have not theretofore complied with this
Article II shall thereafter look only to the Surviving Corporation for payment
of their claim for the Merger Consideration in accordance with this Article
II.
(e) No Liability. None
of Parent, the Company, the Surviving Corporation or the Paying Agent or any of
their respective Affiliates shall be liable to any Person in respect of any
Merger Consideration properly delivered to a public official pursuant to any
applicable abandoned property, escheat or similar Law. If any
Certificate shall not have been surrendered immediately prior to the date on
which any Merger Consideration would otherwise escheat to or become the property
of any Governmental Entity, any such Merger Consideration shall, to the extent
permitted by applicable Law, become the property of the Surviving Corporation,
free and clear of all claims or interest of any Person previously entitled
thereto.
(f) Investment of Exchange
Fund. The Paying Agent shall invest the cash included in the
Exchange Fund as directed by Parent prior to the Effective Time and by the
Surviving Corporation after the Effective Time. If for any reason
(including losses) the cash in the Exchange Fund shall be insufficient to fully
satisfy all of the payment obligations to be made in cash by the Paying Agent
hereunder, the Surviving Corporation shall promptly deposit or cause to be
deposited into the Exchange Fund an amount in cash which is equal to such
deficiency in order to fully satisfy such cash payment
obligations. Any interest and other income resulting from such
investments shall be payable to Parent prior to the Effective Time and to the
Surviving Corporation after the Effective Time.
(g) Lost
Certificates. If any Certificate has been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the Person claiming
such Certificate to be lost, stolen or destroyed and, if required by Parent or
the Paying Agent, the entering into of an indemnity or the posting of a bond as
indemnity against any claim that may be made against it with respect to such
Certificate, the Paying Agent shall deliver in exchange for such lost, stolen or
destroyed Certificate the Merger Consideration pursuant to this Article
II.
(h) Withholding
Rights. The Surviving Corporation or the Paying Agent shall be
entitled to deduct and withhold from the consideration otherwise payable
pursuant to this Agreement to any holder of Certificates such amounts as the
Surviving Corporation or the Paying Agent is required to deduct and withhold
with respect to the making of such payment 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 and paid over to the appropriate taxing authority by the
Surviving Corporation or the Paying Agent, such withheld amounts shall be
treated for all purposes of this Agreement as having been paid to the holder of
Certificates in respect of which such deduction and withholding was made by the
Surviving Corporation or the Paying Agent.
-6-
Section
2.03. Stock
Options.
(a) Prior to
the Effective Time, the Company shall take such action as is necessary to cause
each unvested Company Stock Option that is outstanding immediately prior to the
Effective Time to become fully vested and exercisable. Prior to the
Closing Date, the Company shall (i) cancel, immediately prior to the Effective
Time, each then-outstanding Company Stock Option (provided that, if required
under the Company Stock Plan and/or any Company Stock Option, the Company shall
obtain from the holder of such Company Stock Option any consent, in writing,
required to effect such cancellation) in exchange for an amount in cash (less
any applicable withholding required by Law) payable at or as soon as practicable
after the Effective Time, equal to the product of (A) the total number of shares
of Company Common Stock underlying such Company Option and (B) the excess, if
any, of the Merger Consideration over the per share exercise price of such
Company Option, and (ii) make any amendments to the Company Stock Plan and/or
agreements relating to the Company Stock Options that may be necessary or
desirable to implement the foregoing. Notwithstanding the foregoing,
the Company shall agree, and Parent shall cause each Affiliate of Parent holding
Company Stock Options set forth on Schedule 2.03(a) (the “Affiliate Company Stock
Options”) to agree, that such Affiliate Company Stock Options shall be
cancelled immediately prior to the Effective Time.
(b) For
purposes of this Agreement: (i) “Company Stock Option”
means any option or right to purchase Company Common Stock under the Company
Stock Plan; and (ii) “Company Stock Plan”
means the Company’s 1996 Stock Incentive Plan.
ARTICLE
III
REPRESENTATIONS
AND WARRANTIES
Section
3.01. Representations and
Warranties of the Company. Except
(i) as disclosed in, and reasonably apparent from, the Company SEC Documents
filed by the Company and publicly available prior to the date of this Agreement
(“Filed Company SEC
Documents”) and only as and to the extent disclosed therein (other than
any forward-looking disclosures set forth in any risk factor section, any
disclosures in any section relating to forward-looking statements and any other
disclosures included therein to the extent they are primarily predictive,
cautionary or forward-looking in nature, and provided that, in no event shall
any disclosure in any Filed Company SEC Documents qualify or limit the
representations and warranties of the Company set forth in Sections 3.01(c) or
(d), or (ii) as to any other information set forth in Section 3.01 that the
Chief Executive Officer of the Company knows, or reasonably should know in the
performance of his duties as the Chief Executive Officer of the Company, is not
true, complete or correct, the Company represents and warrants to Parent and
Merger Sub as follows:
(a) Organization, Standing and Corporate
Power. The Company and each of its subsidiaries is validly
existing under the Laws of the jurisdiction of its incorporation or formation,
as the case may be. The Company and each of its subsidiaries has all
requisite corporate, partnership, limited liability company or similar power and
authority and possesses all governmental licenses, permits, authorizations and
approvals necessary to enable it to use its corporate or other name and to own,
lease or otherwise hold and operate its properties and other assets and to carry
on its business as currently conducted, except where the failure to have such
-7-
(b) Subsidiaries. All
of the issued and outstanding capital stock of, or other equity interests in,
each subsidiary of the Company have been duly authorized, validly issued and are
fully paid and nonassessable and are directly or indirectly owned by the
Company, free and clear of all pledges, liens, charges, encumbrances or security
interests of any kind or nature whatsoever (collectively, “Liens”), other than
Liens imposed by or arising under applicable Law or which are not material, and
free of any restriction on the right to vote, sell or otherwise dispose of such
capital stock or other equity interests. Except as set forth in the
Filed Company SEC Documents and except for the capital stock of, or voting
securities or equity interests in, its subsidiaries, the Company does not own,
directly or indirectly, as of the date of this Agreement, any capital stock of,
or other voting securities or equity interests in, any corporation, partnership,
joint venture, association or other entity, or any options, warrants, rights or
securities convertible, exchangeable or exercisable therefor. There
are no bonds, debentures, notes or other indebtedness of any of the Company’s
subsidiaries having the right to vote (or convertible into, or exchangeable for,
securities having the right to vote) on any matters upon which such
subsidiaries’ equityholders may vote. Except as set forth in the
Filed Company SEC Documents and except for capital stock held by the Company or
a wholly-owned subsidiary of the Company, (i) there are not issued, reserved for
issuance or outstanding (A) any shares of capital stock or other voting
securities or equity interests of any subsidiary of the Company, (B) any
securities of any subsidiary of the Company convertible into or exchangeable or
exercisable for shares of capital stock or other voting securities or equity
interests of such subsidiary, or (C) any warrants, calls, options or other
rights to acquire, and no obligation to issue, any capital stock, voting
securities, equity interests or securities convertible into or exchangeable or
exercisable for capital stock or voting securities of any subsidiary of the
Company, and (ii) there are not any outstanding obligations to repurchase,
redeem or otherwise acquire any such securities or to issue, deliver or sell, or
cause to be issued, delivered or sold, any such securities. Neither
the Company nor any of its subsidiaries is a party to any voting Contract with
respect to the voting of such securities. There are no outstanding
obligations to repurchase, redeem or otherwise acquire any such outstanding
securities or to issue, deliver or sell, or cause to be issued, delivered or
sold, any such securities.
(c) Capital
Structure. The authorized capital stock of the Company
consists of 15,000,000 shares of Company Common Stock and 5,000,000 shares of
preferred stock, par value $0.001 per share (“Company Preferred
Stock”). At the close of business on December 31, 2008 (the
“Capitalization
Date”), (i) 7,181,941 shares of Company Common
-8-
(d) Authority;
Noncontravention.
(i) The
Company has all requisite corporate power and authority to execute and deliver
this Agreement and, subject to receipt of the Stockholder Approval and the
governmental filings and other matters referred to in the last sentence of this
Section 3.01(d), to perform its obligations under this Agreement and to
consummate the Merger and the other transactions contemplated by this
Agreement. The execution, delivery and performance of this Agreement
by the Company and the consummation by the Company of the Merger and the other
transactions contemplated by this Agreement have been duly authorized by all
necessary corporate action on the part of the Company and no other corporate
proceedings on the part of the Company are necessary to authorize this Agreement
or to consummate the Merger
-9-
(ii) Upon the
recommendation of a committee comprised of the independent members of the Board
of Directors of the Company (the “Independent
Committee”), the Board of Directors of the Company, at a meeting duly
called and held, duly adopted resolutions (A) approving and declaring advisable
this Agreement, the Merger and the other transactions contemplated by this
Agreement, (B) declaring and recommending to its stockholders that it is
advisable and in the best interests of the Company and the stockholders of the
Company that the Company enter into this Agreement and consummate the Merger and
the other transactions contemplated by this Agreement on the terms and subject
to the conditions set forth in this Agreement, and (C) recommending that the
stockholders of the Company adopt this Agreement, which resolutions, as of the
date of this Agreement, have not been subsequently rescinded, modified or
withdrawn in any way (the “Company Board
Recommendation”).
(iii) The
execution, delivery and performance of this Agreement by the Company do not, and
the consummation by the Company of the Merger and the other transactions
contemplated by this Agreement and compliance by the Company with the provisions
of this Agreement will not, conflict with, or result in any violation or breach
of, or default (with or without notice or lapse of time, or both) under, require
consent under, or give rise to a right of, or result in, termination,
cancellation, modification or acceleration of any obligation or to the loss of a
benefit under, or result in the creation of any Lien in or upon any of the
properties or other assets of the Company or any of its subsidiaries under, (A)
subject to the obtaining of the Stockholder Approval, the Company Charter or the
Company Bylaws or the comparable organizational documents of any of the
Company’s subsidiaries, (B) any loan or credit agreement, bond, debenture, note,
mortgage, indenture, lease, supply agreement, license agreement, development
agreement or other contract, agreement, obligation, commitment or instrument,
whether written or oral, that is intended by the Company or any of its
subsidiaries to be legally binding (each, including all amendments thereto, a
“Contract”) to
which the Company or any of its subsidiaries is a party or any of their
respective properties or other assets are subject, or (C) subject to the
obtaining of the Stockholder Approval and the governmental filings and other
matters referred to in the following sentence, any (1) federal, state, local,
provincial or foreign statute, law, ordinance, rule or regulation (each, a
“Law”)
applicable to the Company or any of its subsidiaries or their respective
properties or other assets, or (2) order, writ, injunction, decree, judgment or
stipulation (each, an “Order”) applicable to
the Company or any of its subsidiaries or their respective properties or other
assets, other than, in the case of clauses (B) and (C) above, any such
conflicts, violations, breaches, defaults, consents, rights of termination,
cancellation, modification or acceleration, losses or Liens that would not,
individually or in the aggregate, reasonably be expected to have a Material
Adverse Effect. No consent, approval, order or authorization of,
action by or in respect of, or registration, declaration, notice to or filing
with, any federal, state, local or foreign government, any court,
administrative, regulatory or
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(e) Company SEC
Documents.
(i) The
Company has filed with or furnished to the SEC, on a timely basis, all reports,
schedules, forms, statements and other documents (including exhibits and other
information incorporated therein) required to be filed or furnished by the
Company since January 1, 2007 (such documents, together with any documents filed
during such period by the Company with the SEC on a voluntary basis on Current
Reports on Form 8-K, the “Company SEC
Documents”). Except with respect to the Company’s Annual
Report on Form 10-K for the year ended September 30, 2008, as filed with the SEC
on December 29, 2008 and as amended by the Form 10-K/A filed by the Company with
the SEC on January 28, 2009 (but solely with respect to the Company’s failure to
provide a report of the Company’s management on the Company’s internal control
over financial reporting as required by Part II, Item 9(A)(T) of Form 10-K), as
of their respective filing dates, or, if revised, amended, supplemented or
superseded by a later-filed Company SEC Document filed prior to the date of this
Agreement, as of the date of filing of the last such revision, amendment,
supplement or superseding filing, the Company SEC Documents complied in all
material respects with, to the extent in effect at the time of filing, the
requirements of the Securities Act of 1933, as amended (including the rules and
regulations promulgated thereunder, the “Securities Act”), the
Exchange Act and the Xxxxxxxx-Xxxxx Act of 2002 (including the rules and
regulations promulgated thereunder, “SOX”) applicable to
such Company SEC Documents, and none of the Company SEC Documents contained any
untrue statement of a material fact or omitted to state a material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not
misleading. None of the Company SEC Documents (as revised, amended,
supplemented or superseded by a later-filed Company SEC Document) contains any
untrue statement of a material fact or omits to state any material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading, which
individually or in the aggregate would require an amendment, supplement or
corrective filing to such Company SEC Documents. Each of the
financial
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(ii) As of the
date of this Agreement, (A) there are no outstanding or unresolved comments in
comment letters received from the SEC staff with respect to the Company SEC
Documents, and (B) to the Knowledge of the Company, none of the Company SEC
Documents is the subject of ongoing SEC review, outstanding SEC comment or
outstanding SEC investigation.
(f) Voting
Requirements. Assuming the accuracy of the representations and
warranties of the Parent and Merger Sub in Section 3.02 and except for the
Special Stockholder Approval provided for under Section 6.01(a) hereof, the only
vote of holders of securities of the Company which is required to approve this
Agreement and the Merger is the affirmative vote of holders of at least a
majority of the outstanding shares of Company Common Stock at the Stockholders’
Meeting or any adjournment or postponement thereof to approve this Agreement
(the “Stockholder
Approval”).
(g) State Takeover
Laws. The Board of Directors of the Company, upon the
recommendation of the Independent Committee, has approved this Agreement, the
terms of this Agreement and the consummation of the Merger and the other
transactions contemplated by this Agreement, and such approval represents all
the actions necessary to render inapplicable to this Agreement and the Merger
and the other transactions contemplated by this Agreement, the restrictions on
“business combinations” set forth in Section 203 of the DGCL, to the extent such
restrictions would otherwise be applicable to this Agreement or the Merger and
the other transactions contemplated by this Agreement. No other state
takeover statute or similar statute or regulation applies to this Agreement or
the Merger or the other transactions contemplated by this
Agreement.
(h) Brokers and Other
Advisors. No broker, investment banker, financial advisor or
other Person (other than FMV Opinions, Inc. for its opinion referenced in
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(i) Opinion of Financial
Advisors. On March 11, 2009, the Independent Committee
received the opinion of FMV Opinions, Inc. to the effect that, as of such date,
the Merger Consideration is fair, from a financial point of view, to the holders
of shares of Company Common Stock other than Attiazaz Din, Xxxxxxx Din, Mediha
Din and Ali Din and their respective Affiliates.
(j) Schedule 13E-3/Proxy Statement;
Other Information. None of the information provided by the
Company for inclusion in the Schedule 13E-3 or the Proxy Statement (the “Company Information”)
will, in the case of the Schedule 13E-3, as of the date of its filing and of
each amendment or supplement thereto and, in the case of the Proxy Statement,
(i) at the time of the mailing of the Proxy Statement or any amendments or
supplements thereto, and (ii) at the time of the Stockholders’ Meeting, contain
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. The Proxy Statement will comply as to form in all
material respects with the requirements of the Exchange Act.
Section
3.02. Representations and
Warranties of Parent and Merger Sub. Parent
and Merger Sub represent and warrant to the Company as follows:
(a) Organization, Standing and Corporate
Power. Each of Parent and Merger Sub is validly existing under
the laws of the State of Delaware. Each of Parent and Merger Sub has
made available to the Company true, complete and accurate copies of its
respective certificate of incorporation and bylaws. Each of Parent
and Merger Sub has the requisite corporate power and authority to own, operate
or lease its respective properties and to carry on its respective business as it
is now being conducted, and is duly qualified or licensed to do business, and is
in good standing, in each jurisdiction in which the nature of its respective
business or the properties owned, operated or leased by it makes such
qualification, licensing or good standing necessary, except where the failure to
have such power, authority or to be so qualified, licensed or in good standing,
would not, individually or in the aggregate, reasonably be expected to have an
Parent Material Adverse Effect.
(b) Authority;
Noncontravention.
(i) Each of
Parent and Merger Sub has all requisite power and authority to execute and
deliver this Agreement, to perform its obligations under this Agreement and to
consummate the transactions contemplated by this Agreement. The
execution, delivery and performance of this Agreement by Parent and Merger Sub
and the consummation by Parent and Merger Sub of the transactions contemplated
by this Agreement have been duly authorized by
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(ii) The
execution, delivery and performance of this Agreement by Parent and Merger Sub
do not, and the consummation by Parent and Merger Sub of transactions
contemplated by this Agreement and compliance by Parent and Merger Sub with the
provisions of this Agreement will not, conflict with, or result in any violation
or breach of, or default (with or without notice or lapse of time, or both)
under, require consent under, or give rise to a right of, or result in,
termination, cancellation, modification or acceleration of any obligation or to
the loss of a benefit under, or result in the creation of any Lien in or upon
any of the properties or other assets of Parent or Merger Sub under (A) the
certificate of incorporation and bylaws of Parent or Merger Sub, (B) any
Contract to which Parent or Merger Sub is a party or any of their respective
properties or other assets are subject (including any credit facilities or
agreements and any other indebtedness arrangements), or (C) subject to the
governmental filings and other matters referred to in the following sentence,
any Laws and Orders applicable to Parent or Merger Sub or their respective
properties or other assets, other than, in the case of the immediately preceding
clauses (B) and (C), any such conflicts, violations, breaches, defaults,
consents, rights of termination, cancellation, modification or acceleration,
losses or Liens that would not, individually or in the aggregate, reasonably be
expected to have an Parent Material Adverse Effect. No consent,
approval, order or authorization of, action by or in respect of, or
registration, declaration, notice to or filing with, any Governmental Entity is
required by or with respect to Parent or Merger Sub in connection with the
execution and delivery of this Agreement by Parent or Merger Sub or the
consummation by Parent and Merger Sub of the transactions contemplated by this
Agreement, except for (x) the filing of the Schedule 13E-3 with the SEC, (y) the
filing of the Certificate of Merger with the Secretary of State of the State of
Delaware and appropriate documents with the relevant authorities of the other
states in which Parent and Merger Sub are qualified to do business, and (z) such
other consents, approvals, orders, authorizations, actions, registrations,
declarations, notices and filings the failure of which to be obtained or made
would not individually or in the aggregate, reasonably be expected to have an
Parent Material Adverse Effect.
(c) Capital Structure;
Operations. The authorized capital stock of Merger Sub
consists of 1,000 shares of common stock, par value $0.001 per share, all of
which are issued and outstanding and owned by Parent. The authorized
capital stock of Parent consists of 3,000,000 shares of common stock, par value
$0.001 per share; as of the date hereof, Attiazaz Din owns one (1) share of
common stock of Parent, which is the only issued and outstanding share of common
stock of Parent as of the date hereof. Parent and Merger Sub were
formed solely for the purpose of engaging in the Merger and the other
transactions contemplated by this Agreement and have not engaged in any business
activities or conducted any operations other than in connection with the
transactions contemplated by this Agreement.
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(d) Financing. Parent
has delivered to the Company a true and complete copy, as of the date of this
Agreement, of an executed commitment letter to provide debt financing to Parent
(or Merger Sub) in an aggregate amount set forth therein, subject to the terms
and conditions thereof (the “Financing
Commitment”), the proceeds of which shall be used to consummate the
Merger and the other transactions contemplated by this Agreement (the “Financing”). As
of the date of this Agreement, the Financing Commitment, in the form delivered
to the Company, (i) has not been amended or modified, withdrawn or rescinded in
any respect, (ii) represents the entire agreement between the parties, and (iii)
is in full force and effect and is a legal, valid and binding obligation of
Parent and, to the Knowledge of Parent, the other parties
thereto. The Financing Commitment contains all of the conditions
precedent to the obligations of the parties thereunder to make the Financing
available to Parent. As of the date of this Agreement, subject to the
accuracy of the representations and warranties of the Company set forth in
Section 3.01, Parent has no reason to believe that it will be unable to satisfy
on a timely basis any term or condition to be satisfied by it contained in the
Financing Commitment. Subject to the accuracy of the representations
and warranties of the Company set forth in Section 3.01(c), the proceeds from
the Financing, when funded in accordance with the Financing Commitment and
together with available funds at the Company, are sufficient for the
satisfaction of all of Parent’s obligations under this Agreement, including the
payment of the aggregate Merger Consideration and the consideration payable in
respect of the Company Stock Options and to pay all related fees and
expenses. Notwithstanding anything in this Agreement to the contrary,
the Financing Commitment may be superseded at the option of Parent after the
date of this Agreement but prior to the Effective Time by the New Financing
Commitments in accordance with Section 5.07. In such event, the term
“Financing
Commitment” as used in this Agreement shall be deemed to include the New
Financing Commitments to the extent then in effect.
(e) Brokers. No
broker, investment banker or financial advisor or other Person (other than
Xxxxxx Xxxxx Xxxxxxxxxx LLC, the fees and expenses of which will be paid by
Parent) is entitled to any broker’s, finder’s, financial advisor’s fees or
commissions in connection with the transactions contemplated by this Agreement
based upon arrangements made by or on behalf of Parent or Merger
Sub.
(f) Schedule 13E-3/Proxy Statement;
Other Information. None of the information provided by Parent
or Merger Sub with respect to itself for inclusion in the Schedule 13E-3 or the
Proxy Statement (the “Parent Information”)
will, in the case of the Schedule 13E-3, as of the date of its filing and of
each amendment or supplement thereto and, in the case of the Proxy Statement,
(i) at the time of the mailing of the Proxy Statement or any amendments or
supplements thereto and (ii) at the time of the Stockholders’ Meeting, contain
any untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading. Notwithstanding the foregoing, Parent and Merger Sub make
no representation or warranty with respect to any information that is contained
or incorporated by reference in the Proxy Statement or the Schedule 13E-3 other
than with respect to the Parent Information as set forth in this
paragraph.
(g) Absence of Arrangements with
Management. Except for this Agreement, as of the date of this
Agreement there are no contracts, undertakings, commitments,
-15-
(h) Access to Information and
Investigation by Parent. Parent and its Representatives have
received access to such books and records, facilities, equipment, contracts and
other assets of the Company which it and its Representatives, as of the date
hereof, have requested to review, and that it and its Representatives have had
full opportunity to meet with officers and other Representatives of the Company
for the purpose of investigating and obtaining information regarding the
Company’s business, operations and legal affairs. Parent has
conducted its own independent investigation, review and analysis of the
business, operations, assets, liabilities, results of operations, financial
condition, and prospects of the Company and its subsidiaries, which
investigation, review and analysis was done by Parent and, to the extent Parent
deemed appropriate, by Parent’s Representatives. Without limiting the
generality of the foregoing, none of the Company or its subsidiaries nor any of
their respective Representatives or any other person has made a representation
or warranty to Parent with respect to (i) any projections, estimates or budgets
for the Company or its subsidiaries, (ii) any material, documents or information
relating to the Company or its subsidiaries made available to Parent, or (iii)
in connection with any materials prepared for or in connection with Parent’s
arrangement of the Financing or the Financing Commitment, except as expressly
and specifically covered by a representation or warranty set forth in Section
3.01.
(i) Solvency. Assuming
the satisfaction of the conditions to the obligation of Parent to consummate the
Merger, or the waiver of such conditions, and the accuracy of the
representations and warranties of the Company set forth in Section 3.01 hereof,
then immediately after giving effect to the transactions contemplated by this
Agreement, the Surviving Corporation will be Solvent. For purposes of
this Section 3.02, the term “Solvent” with respect
to the Surviving Corporation means that, as of any date of determination, (i)
the amount of the fair saleable value of the assets of the Surviving Corporation
and its subsidiaries, taken as a whole, exceeds, as of such date, the sum of (A)
the value of all liabilities of the Surviving Corporation and its subsidiaries,
taken as a whole, including contingent liabilities valued at the amount that is
reasonably expected to become due, as of such date, as such quoted terms are
generally determined in accordance with the applicable federal laws governing
determinations of the solvency of debtors, and (B) the amount that will be
required to pay the liabilities that are reasonably expected to become due of
the Surviving Corporation and its subsidiaries, taken as a whole, on its
existing debts (including contingent liabilities) as such debts become absolute
and matured, (ii) the Surviving Corporation and its subsidiaries, taken as a
whole, will not have, as of such date, an unreasonably small amount of capital
for the operation of their businesses in which it is engaged or proposed to be
engaged by Parent following such date, and (iii) the Surviving Corporation and
its subsidiaries, taken as a whole, will be able to pay its liabilities,
including contingent and other liabilities, as they mature. For
purposes of this definition, “not have an unreasonably small amount of capital
for the operation of the businesses in which it is engaged or proposed to be
engaged” and “able to pay its liabilities, including contingent and other
liabilities, as they mature” means that the Surviving
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ARTICLE
IV
COVENANTS
RELATING TO CONDUCT OF BUSINESS; NO SOLICITATION
Section
4.01. Conduct of Business by the
Company.
(a) During
the period from the date of this Agreement to the Effective Time, except as
contemplated by this Agreement or as consented to in writing in advance by
Parent, the Company shall, and shall cause each of its subsidiaries to, carry on
its business in all material respects in the ordinary course and, to the extent
consistent therewith, use all commercially reasonable efforts to preserve intact
its current business organizations, to keep available the services of its
current officers, key employees and consultants and to preserve its
relationships with customers, suppliers, licensors, licensees, distributors and
others having business dealings with it. In addition to and without
limiting the generality of the foregoing, during the period from the date of
this Agreement to the Effective Time, except as contemplated by this Agreement,
the Company shall not, and shall not permit any of its subsidiaries to, without
Parent’s prior written consent:
(i) (A)
declare, set aside or pay any dividends on, or make any other distributions
(whether in cash, stock or property) in respect of, any of its capital stock,
other than dividends or distributions by a direct or indirect subsidiary wholly
owned by the Company to the Company or another directly or indirectly wholly
owned subsidiary of the Company in the ordinary course of business consistent
with past practice, (B) 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 (C) purchase, redeem
or otherwise acquire any shares of its capital stock or any other securities
thereof or any rights, warrants or options to acquire any such shares or other
securities;
(ii) issue,
deliver, sell, grant, pledge or otherwise encumber or subject to any Lien 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, or any “phantom” stock,
“phantom” stock rights, stock appreciation rights or stock based performance
units, including pursuant to Contracts as in effect on the date of this
Agreement (other than the issuance of shares of Company Common Stock upon the
exercise of Company Stock Options in accordance with their terms on the date of
this Agreement);
(iii) amend or
waive any provision in the Company Charter or the Company Bylaws or other
comparable charter or organizational documents of any of the Company’s
subsidiaries, except as may be required by applicable Law or the rules and
regulations of the SEC or the Nasdaq Capital Market, or, in the case of the
Company, enter into any agreement with any of its stockholders in their capacity
as such;
(iv) directly
or indirectly acquire, (A) by merging or consolidating with, by purchasing a
substantial portion of the assets of, by making an investment
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(v) (A)
incur, create, assume or otherwise become liable for, any indebtedness for
borrowed money or guarantee any such indebtedness of another Person, issue or
sell any debt securities or calls, options, warrants or other rights to acquire
any debt securities of the Company or any of its subsidiaries, guarantee any
debt securities of another Person, enter into any “keep well” or other Contract
to maintain any financial statement condition of another Person or enter into
any arrangement having the economic effect of any of the foregoing (other than
borrowings under the Company’s existing loan facilities in the ordinary course
of business), or (B) make any loans or advances to any other Person, except for
loans, advances, capital contributions or investments between any subsidiary of
the Company and the Company or another subsidiary of the Company in the ordinary
course of business consistent with past practice;
(vi) except as
required by Law or any judgment, (A) pay, discharge, settle or satisfy any
material claims, liabilities, obligations or litigation (absolute, accrued,
asserted or unasserted, contingent or otherwise), other than the payment,
discharge, settlement or satisfaction in the ordinary course of business or in
accordance with their terms, of liabilities disclosed, reflected or reserved
against in the most recent financial statements (or the notes thereto) of the
Company included in the Filed Company SEC Documents (for amounts not in excess
of such reserves), or (B) cancel any material indebtedness;
(vii) except
(x) as required to ensure that any Benefit Plan is not then out of compliance
with applicable Law, or (y) to comply with any Benefit Plan or Contract entered
into prior to the date of this Agreement, (A) adopt, enter into, terminate or
amend (1) any collective bargaining Contract or Benefit Plan or (2) any other
Contract, plan or policy involving the Company or any of its subsidiaries as
applied to directors and executive officers of the Company (“Key Persons”), or (B)
increase in any manner the compensation, bonus or fringe or other benefits of,
or pay any discretionary bonus of any kind or amount whatsoever to, any current
or former director, officer, employee or consultant, except in the ordinary
course of business consistent with past practice to employees of the Company or
its subsidiaries other than Key Persons;
(viii) adopt or
enter into a plan of complete or partial liquidation, dissolution, merger,
consolidation, restructuring, recapitalization or other reorganization of such
entity (other than among wholly-owned subsidiaries of the Company);
or
(ix) authorize
any of, or commit, resolve, propose or agree to take any of, the foregoing
actions.
(b) Advice of Changes;
Filings. The Company, on the one hand, and Parent and Merger
Sub, on the other hand, shall promptly advise the other party in writing if (i)
any representation, warranty, condition or agreement made by it contained in
this Agreement becomes untrue or inaccurate in a manner that would result in the
failure of any one more of the conditions set forth in Section 6.02(a) or
6.02(b) or Section 6.03(a) or 6.03(b), and (ii) the Company or Parent or Merger
Sub fails to comply with or satisfy in any material respect any
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(c) Confidential Portions of
Governmental Entity Filings. The Company and Parent shall, to
the extent permitted by Law, promptly provide the other with copies of all
filings made by such party with any Governmental Entity in connection with this
Agreement and the transactions contemplated by this Agreement, other than the
portions of such filings that include confidential or proprietary information
not directly related to the transactions contemplated by this
Agreement.
(d) Actions Taken at Direction of
CEO. Notwithstanding any other provision of this Agreement to
the contrary, the Company shall not be deemed to be in breach of any agreement
or obligation hereunder including, without limitation, those set forth in
Articles IV and V hereof, if the alleged breach is the proximate result of
action taken by the Company at the direction of the Chief Executive Officer
without the approval or direction of the Board of Directors of the Company (or
an authorized committee thereof).
Section
4.02. No
Solicitation.
(a) Solicitations. Notwithstanding
any other provision of this Agreement to the contrary, during the period
beginning on the date of this Agreement and continuing until 11:59 p.m. Los
Angeles, California time on the date which is thirty (30) days after the date of
this Agreement (the “No-Shop Period Start
Time”), the Company and its subsidiaries and their respective
Representatives shall have the right to: (i) initiate, solicit and encourage,
whether publicly or otherwise, Takeover Proposals, including by way of providing
access to non-public information concerning the Company and its subsidiaries
pursuant to (but only pursuant to) one or more Acceptable Confidentiality
Agreements; provided that (A) the Company shall promptly provide or make
available to Parent any material non-public information concerning the Company
or its subsidiaries that is provided or made available to any Person given such
access which was not previously provided or made available to Parent, and (B)
the Company shall not disclose (and shall not permit any of its Representatives
to disclose) the terms of the Financing Commitments or the identities of any
other potential financing sources for the transactions contemplated by this
Agreement to any Person, except to the extent such terms are otherwise publicly
available; and (ii) enter into and maintain discussions or negotiations with
respect to Takeover Proposals or otherwise cooperate with or assist or
participate in, or facilitate any such inquiries, proposals, discussions or
negotiations.
“Acceptable Confidentiality
Agreement” means a confidentiality agreement approved by the Independent
Committee, provided that such confidentiality agreement shall not prohibit
compliance with Section 4.02(f)(i).
“Takeover Proposal”
means any inquiry, proposal or offer (including, without limitation, a letter of
intent) from any Person or group of Persons (other than Parent and its
Affiliates) relating to, or that is reasonably likely to lead to, any direct or
indirect acquisition or purchase, in one transaction or a series of related
transactions, of assets (including equity securities of any
-19-
subsidiary
of the Company) or businesses that constitute 25% or more of the revenues, net
income or assets of the Company and its subsidiaries (taken as a whole), or 25%
or more of any class of equity securities of the Company or any of its
subsidiaries, any tender offer or exchange offer that if consummated would
result in any Person beneficially owning 25% or more of any class of equity
securities of the Company or any of its subsidiaries, or any merger,
consolidation, business combination, recapitalization, liquidation, dissolution,
joint venture, binding share exchange or similar transaction involving the
Company or any of its subsidiaries pursuant to which any Person or the
shareholders of any Person would own 25% or more of any class of equity
securities of the Company or any of its subsidiaries, in each case other than
the transactions contemplated by this Agreement.
“Superior Proposal”
means any written Takeover Proposal that, if consummated, would result in such
Person (or its equityholders) owning, directly or indirectly, more than 50% of
the shares of Company Common Stock then outstanding (or of the shares of the
surviving entity in a merger or the direct or indirect parent company of the
surviving entity in a merger) or a majority of the assets of the Company and its
subsidiaries (taken as a whole), which the Independent Committee determines in
good faith (after consultation with its outside counsel and financial advisor)
would, if consummated, be more favorable to the stockholders of the Company from
a financial point of view than the transactions contemplated by this Agreement
(taking into account all the terms and conditions of such proposal and this
Agreement, including (x) the likelihood and timing of consummation of such
transaction on the terms set forth therein (as compared to the terms herein),
(y) all appropriate legal, financial (including the financing terms of such
proposal), regulatory and other aspects of such proposal, and (z) any changes to
the financial and other terms of this Agreement proposed by Parent in response
to such Takeover Proposal or otherwise).
Parent
agrees that it shall not, and that it shall cause its Affiliates not to, and
that it shall use its reasonable best efforts to cause its Representatives not
to, intentionally enter, or seek to enter, into any agreement, arrangement or
understanding with a potential bidding party that interferes with the Company’s
ability to seek and obtain a Superior Proposal from such party (including
interfering with the ability of the Company to hold discussions and negotiations
with such party in connection therewith); provided, however, that the
obligations under this Section 4.02(a) shall not prevent Parent or its
Affiliates from (1) exercising its rights under this Section 4.02, (2) making
any public announcement with respect to such rights not otherwise prohibited
hereby, or (3) contacting third parties with respect to obtaining additional
debt or equity financing in order to consummate the transactions contemplated
hereby. Except as otherwise required by Law, Parent or Merger Sub
shall not, and shall cause its respective Affiliates not to, make any public
statement that such Person does not intend to vote for or otherwise support any
Takeover Proposal or Superior Proposal.
(b) During
the period from the No-Shop Period Start Time to the Effective Time or the date,
if any, on which this Agreement is earlier terminated pursuant to Section 7.01,
the Company will not, and will cause its subsidiaries not to, and will not
authorize or permit any of the Company’s and its subsidiaries’ respective
officers, directors, employees and other Representatives to, directly or
indirectly, (i) initiate or solicit or knowingly encourage (including by way of
providing information), the submission of any inquiries, proposals or offers or
any other efforts or attempts that constitute or may reasonably be expected to
lead to, a
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(c) Notwithstanding
anything to the contrary in Section 4.02(b), at any time prior to obtaining the
Company Stockholder Approvals, in the event that (i) the Company receives an
unsolicited written Takeover Proposal that the Independent Committee believes in
good faith to be bona fide following disclosure thereof to the full Board of
Directors, (ii) the Independent Committee determines in good faith, after
consultation with its financial advisors and outside counsel, that such Takeover
Proposal constitutes or could reasonably be expected to result in a Superior
Proposal, and (iii) after consultation with its counsel, the Independent
Committee determines in good faith that the failure to take such action would
breach or violate its fiduciary duties to the stockholders of the Company under
applicable Law, then the Company and the Independent Committee may (A)
participate in discussions or negotiations (including, as a part thereof, making
any counterproposal) with the Person making the Takeover Proposal regarding such
Takeover Proposal, and (B) furnish information with respect to the Company and
its subsidiaries to the Person making the Takeover Proposal; provided that the
Company (x) will not, and will not allow its Representatives to, disclose any
non-public information concerning the Company or any of its subsidiaries to such
Person without entering into an Acceptable
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(d) From and
after the No-Shop Period Start Time, the Company will promptly (and in any event
within one Business Day) notify Parent of the receipt by the Company of any
Takeover Proposal, which notice shall include the material terms of and identity
of the Person(s) making such Takeover Proposal. From and after the
No-Shop Period Start Time, the Company will keep Parent informed on a current
basis of the status and details of any such Takeover Proposal and of any
amendments or proposed amendments thereto and any developments, discussions and
negotiations concerning such Takeover Proposal, in each case, in any event no
later than 48 hours after the occurrence of the applicable amendment,
development, discussion, or negotiation. Without limiting the
foregoing, the Company shall promptly (within one Business Day) notify Parent
orally and in writing if it determines to begin providing information or to
engage in discussions or negotiations with a Person or group of Persons in
connection with any Takeover Proposal.
(e) Subject
to compliance with its obligations under Rules 14d-9 or 14e-2 under the Exchange
Act, as applicable, neither the Independent Committee nor the Board of Directors
of the Company shall (i) approve, endorse or recommend (or publicly propose to
approve, endorse or recommend) any Takeover Proposal or enter into a definitive
agreement with respect to a Takeover Proposal, or (ii) modify or amend (or
publicly propose to modify or amend) in a manner adverse to Parent or withdraw
(or publicly propose to withdraw) the Company Board Recommendation ((i) or (ii)
above being referred to as a “Change in
Recommendation”); provided, however, that Independent Committee and the
Board of Directors of the Company may, at any time prior to obtaining the
Company Stockholder Approvals, make a Change in Recommendation if (i) the
Independent Committee determines, in good faith (after consultation with its
legal counsel), that the failure to take such action would breach or violate its
fiduciary duties to the stockholders of the Company under applicable Law, or
(ii) in response to a Superior Proposal under the circumstances contemplated in
Section 4.02(f).
(f) Notwithstanding
anything to the contrary contained in this Agreement, if, at any time prior to
obtaining the Company Stockholder Approvals, the Company receives a Takeover
Proposal which the Independent Committee concludes in good faith constitutes a
Superior Proposal after giving effect to all of the adjustments which may be
offered by Parent pursuant to clause (ii) below, the Board of Directors of the
Company may (x) effect a Change in Recommendation and/or (y) terminate this
Agreement (in accordance with Section 7.01(e)) in order to enter into a
definitive agreement with respect to such Superior Proposal, if the Independent
Committee determines in good faith, after consultation with its counsel, that
failure to take such action would breach or violate its fiduciary duties to the
stockholders of the Company under applicable Law; provided, however, that the
Company shall not terminate this Agreement pursuant to the foregoing clause (y),
and any purported termination pursuant to the foregoing clause (y) shall be void
and of no force or effect, unless concurrently with such termination the Company
pays the Company Termination Fee payable pursuant to Section
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(i) the
Company shall have provided prior written notice to Parent, at least three
calendar days in advance (the “Notice Period”), of
its intention to effect a Change in Recommendation in response to such Superior
Proposal or terminate this Agreement to enter into a definitive agreement with
respect to such Superior Proposal, which notice shall specify the material terms
and conditions of any such Superior Proposal (including the identity of the
party making such Superior Proposal), and shall have contemporaneously provided
a copy of the relevant proposed transaction agreements with the party making
such Superior Proposal and other material documents; and
(ii) prior to
effecting such Change in Recommendation or terminating this Agreement to enter
into a definitive agreement with respect to such Superior Proposal, the Company
shall, and shall cause its financial and legal advisors to, during the Notice
Period, negotiate with Parent in good faith (to the extent Parent desires to
negotiate) to make such adjustments in the terms and conditions of this
Agreement so that such Takeover Proposal ceases to constitute a Superior
Proposal.
In the
event of any revision to the Superior Proposal, the Company shall be required to
deliver a new written notice to Parent and to comply with the requirements of
this Section 4.02(f) with respect to such new written notice.
(g) Nothing
in this Agreement shall prohibit or restrict the Board of Directors of the
Company, in circumstances not involving a Takeover Proposal, from amending,
modifying or withdrawing the Board of Directors’ recommendation to the extent
that the Independent Committee determines in good faith (after consultation with
its legal counsel) that such action is necessary under applicable Law in order
for the directors to comply with their fiduciary duties to the Company’s
stockholders. The Company shall give Parent written notice of any
such action taken by the Board of Directors not later than the Business Day next
succeeding the day on which such action is taken, setting forth in reasonable
detail the action taken and the basis therefor.
ARTICLE
V
ADDITIONAL
AGREEMENTS
Section
5.01. Preparation of the Proxy
Statement and Schedule 13E-3; Stockholders’ Meeting
.
(a) As soon
as reasonably practicable following the date of this Agreement, the Company and
Parent shall prepare, and the Company shall file with the SEC, the Proxy
Statement. The Company shall cause the Proxy Statement to be mailed
to the stockholders of the Company as promptly as practicable. Parent
shall furnish to the Company all information as may be reasonably requested by
the Company in connection with the preparation, filing and distribution of the
Proxy Statement. No filing of, or amendment or supplement to, the
Proxy Statement will be made by the Company without providing Parent a
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(b) Concurrently
with the filing of the Proxy Statement with the SEC, Parent and its Affiliates
shall prepare and file with the SEC, together with the Company, the Schedule
13E-3. Parent and the Company shall cause the Schedule 13E-3 to
comply with the rules and regulations promulgated by the SEC and respond
promptly to any comments of the SEC or its staff regarding the Schedule
13E-3. Each party agrees to provide the other party and its counsel
with copies of any comments that such party or its counsel may receive from the
staff of the SEC regarding the Schedule 13E-3 promptly after receipt
thereof. The Company shall promptly furnish to Parent all information
concerning the Company and its executive officers and directors as may
reasonably be requested in connection with the preparation of the Schedule
13E-3. The Company and its counsel shall be given an opportunity to
review and comment on the Schedule 13E-3 and each supplement, amendment or
response to comments with respect thereto prior to filing with or delivering to
the SEC.
(c) The
Company shall use its reasonable best efforts, as soon as practicable following
the date of this Agreement, to establish a record date for, duly call, give
notice of, convene and hold a meeting of its stockholders (the “Stockholders’
Meeting”) for the purpose of obtaining the Company Stockholder Approvals;
provided that such date may be extended to the extent reasonably necessary to
permit the Company to file and distribute any material amendment to the Proxy
Statement as is required by applicable law. Subject to Section 4.02,
the Company shall, through its Board of Directors, recommend to its stockholders
adoption of this Agreement and the Merger and shall include the Company Board
Recommendation in the Proxy Statement. A Change in Recommendation
permitted by Sections 4.02(e), (f) or (g) will not constitute a breach by the
Company of this Agreement. Without limiting the generality of the
foregoing, but subject to the terms of this Agreement, the Company’s obligations
pursuant to the first sentence of this Section 5.01(c) shall not be affected by
the commencement, public proposal, public disclosure or communication to the
Company of any Takeover Proposal (whether or not a Superior
Proposal). In addition, notwithstanding any Change in Recommendation,
unless this Agreement is terminated pursuant to, and in accordance with, Section
7.01, this Agreement shall be submitted to the stockholders of the Company at
the Stockholders’ Meeting for the purpose of adopting this
Agreement.
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Section
5.02. Access to Information;
Confidentiality.
(a) To the
extent permitted by applicable Law, the Company shall afford to Parent, and to
Parent’s Representatives, reasonable access during normal business hours and
upon reasonable prior notice to the Company during the period prior to the
Effective Time to all its and its subsidiaries’ properties, books, Contracts,
commitments, personnel and records, and, during such period, the Company shall
furnish promptly to Parent (i) a copy of each report, schedule, registration
statement and other document filed by it during such period pursuant to the
requirements of federal or state securities Laws, and (ii) all other information
concerning its and its subsidiaries’ business, properties and personnel as
Parent may reasonably request; provided that such access and inspections shall
not unreasonably disrupt the operations of the Company or its subsidiaries; and
provided further, that the Company shall not be required to (or to cause any of
its subsidiaries to) so confer, afford such access or furnish such copies or
other information to the extent that doing so would result in a violation of
Law, result in the loss of attorney-client privilege or violate confidentiality
obligations owing to third parties. Without limiting the foregoing,
between the date of this Agreement and the Effective Time, the Company shall
(and shall cause its Affiliates to) reasonably cooperate with Parent in
connection with Parent securing the Financing contemplated by Section
3.02(d).
(b) Except
for disclosures expressly permitted by the terms of this Agreement, Parent shall
hold, and shall cause its accountants, counsel, financial advisors and other
Representatives to hold, all information received from the Company, directly or
indirectly, in confidence and not make any public disclosure thereof; provided,
that the foregoing shall not prevent Parent from disclosing such information (i)
to the extent required by applicable Law or by a Governmental Entity, (ii) to
the extent such information is or becomes generally available to the public
other than by disclosure by Parent or any Affiliate or Representative of Parent,
and (iii) as reasonably necessary in connection with Parent securing the
Financing contemplated by Section 3.02(d).
Section
5.03. Reasonable Best
Efforts.
(a) Upon the
terms and subject to the conditions set forth in this Agreement, each of the
parties agrees to use its reasonable best efforts to take, or cause to be taken,
all actions, and to do, or cause to be done, and to assist and cooperate with
the other parties in doing, all things necessary, proper and advisable to
consummate and make effective, as promptly as practicable, the Merger and the
other transactions contemplated by this Agreement, including using reasonable
best efforts to accomplish the following: (i) that the conditions set forth in
Article VI are satisfied; (ii) the obtaining of all necessary actions or
nonactions, waivers, consents, clearances, and approvals from Governmental
Entities and non-governmental third parties and the making of all necessary
registrations, notices and filings (including filings with Governmental
Entities); and (iii) the obtaining of all necessary consents, approvals or
waivers from third parties. Subject to first having used all
reasonable best efforts to negotiate a resolution of any objections underlying
such lawsuits or other legal proceedings, Company and Parent shall use
reasonable best efforts to defend and contest any lawsuits or other legal
proceedings, whether judicial or administrative, challenging this Agreement or
the consummation of the Merger or the other transactions contemplated by this
Agreement,
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(b) The
Company and Parent shall cooperate and consult with each other in connection
with the making of all such filings, notifications and any other material
actions pursuant to this Section 5.03, subject to applicable Law, by permitting
counsel for the other party to review in advance, and consider in good faith the
views of the other party in connection with, any proposed material written
communication to any Governmental Entity and by providing counsel for the other
party with copies of all filings and submissions made by such party and all
correspondence between such party (and its advisors) with any Governmental
Entity and any other information supplied by such party and such party’s
Affiliates to a Governmental Entity or received from such a Governmental Entity
in connection with the transactions contemplated by this Agreement; provided,
however, that material may be redacted (x) as necessary to comply with
contractual arrangements, and (y) as necessary to address good faith legal
privilege or confidentiality concerns. Neither party shall file any
such document or take such action if the other party has reasonably objected
(and not withdrawn its objection) to the filing of such document or the taking
of such action on the grounds that such filing or action would reasonably be
expected to either (i) prevent, materially delay or materially impede the
consummation of the Merger or the other transactions contemplated hereby, or
(ii) cause a condition set forth in Article VI to not be satisfied in a timely
manner. Neither party shall consent to any voluntary extension of any
statutory deadline or waiting period or to any voluntary delay of the
consummation of the transactions contemplated by this Agreement at the behest of
any Governmental Entity without the consent of the other party.
(c) Each of
the Company and Parent will promptly inform the other party upon receipt of any
material communication from any Governmental Entity regarding any of the
transactions contemplated by this Agreement. If the Company or Parent
(or any of their respective Affiliates) receives a request for additional
information or documentary material from any such Governmental Entity that is
related to the transactions contemplated by this Agreement, then such party will
endeavor in good faith to make, or cause to be made, as soon as reasonably
practicable and after consultation with the other party, an appropriate response
in compliance with such request. The parties agree not to
participate, or to permit their Affiliates to participate, in any substantive
meeting or discussion with any Governmental Entity in connection with the
transactions contemplated by this Agreement unless it so consults with the other
party in advance and, to the extent not prohibited by such Governmental Entity,
gives the other party the opportunity to attend and participate. Each
party will advise the other party promptly of any understandings, undertakings
or agreements (oral or written) which the first party proposes to make or enter
into with any Governmental Entity in connection with the transactions
contemplated by this Agreement. In furtherance and not in limitation
of the foregoing, each party will use all reasonable efforts to resolve any
objections that may be asserted with respect to the transactions contemplated by
this Agreement under any antitrust, competition or trade regulatory Laws,
including (subject to first having used all reasonable efforts to negotiate a
resolution to any such objections) contesting and resisting any action or
proceeding and to have vacated, lifted, reversed or overturned any decree,
judgment, injunction or other Order, whether temporary, preliminary or
permanent, that is in effect and that prohibits, prevents or restricts
consummation of the Merger or the other transactions contemplated by this
Agreement and to have such statute, rule, regulation, decree, judgment,
injunction or other
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(d) Notwithstanding
anything herein to the contrary (including Section 5.03), no party is required
to, and the Company may not, without the prior written consent of Parent, become
subject to, consent or agree to, or otherwise take any action with respect to,
any requirement, condition, limitation, understanding, agreement or Order to
sell, to hold separate or otherwise dispose of, or to conduct, restrict,
operate, invest or otherwise change the assets or business of the Company,
Parent, Merger Sub, or any of their Affiliates in any manner which, individually
or in the aggregate with all other such requirements, conditions,
understandings, agreements and Orders could reasonably be expected to have a
material adverse effect on the combined business, financial condition or results
of operations of Parent, Merger Sub and the Company and its subsidiaries taken
as a whole. Notwithstanding anything in this Agreement to the
contrary, the Company will, upon the request of Parent, become subject to, or
consent or agree to or otherwise take any action with respect to, any
requirement, condition, understanding, agreement or Order to sell, to hold
separate or otherwise dispose of, or to conduct, restrict, operate, invest or
otherwise change the assets or business of the Company or any of its Affiliates,
so long as such requirement, condition, understanding, agreement or Order is
binding on the Company only in the event that the Closing
occurs. Furthermore, without the prior written consent of the Parent
(determined in its sole discretion), in no event shall the Company or Parent or
any of their respective subsidiaries or Affiliates: (i) pay any consideration
to, amend or enter into any agreement with, any non-governmental third party to
obtain any consent to the Merger or to otherwise comply with Section 5.03(e); or
(ii) agree to the imposition of limitations on the ability of Parent or any
Affiliate of Parent to hold, or exercise full rights of ownership of, any shares
of capital stock of the Surviving Corporation, including the right to vote such
shares on all matters properly presented to the stockholders of the Surviving
Corporation.
(e) The
Company and its Board of Directors shall (i) use reasonable best efforts to
ensure that no state takeover Law or similar Law is or becomes applicable to
this Agreement, the Merger or any of the other transactions contemplated by this
Agreement, and (ii) if any state takeover Law or similar Law becomes applicable
to this Agreement, the Merger or any of the other transactions contemplated by
this Agreement, use reasonable best efforts to ensure that the Merger and the
other transactions contemplated by this Agreement may be consummated as promptly
as practicable on the terms contemplated by this Agreement and otherwise to
minimize the effect of such Law on this Agreement, the Merger and the other
transactions contemplated by this Agreement.
Section
5.04. Indemnification, Exculpation
and Insurance.
(a) Parent
acknowledges and agrees that the Surviving Corporation shall by operation of law
assume the obligations with respect to all rights to indemnification and
exculpation from liabilities, including advancement of expenses, for acts or
omissions occurring at or prior to the Effective Time now existing in favor of
the current or former directors, officers, employees or agents of the Company or
any of its subsidiaries as provided in the Company’s or any of its subsidiaries’
certificate or articles of incorporation, bylaws or other organizational
documents or any indemnification Contract between such directors, officers,
employees or agents and the Company or any of its subsidiaries (in each case, as
in effect on the
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(b) In the
event that the Surviving Corporation or any of its successors or assigns (i)
consolidates with or merges into any other Person and is not the continuing or
surviving corporation or entity of such consolidation or merger, or (ii)
transfers or conveys all or substantially all of its properties and other assets
to any Person, then, and in each such case, the Surviving Corporation shall
cause proper provision to be made so that the successors and assigns of the
Surviving Corporation shall expressly assume the obligations set forth in this
Section 5.04 for a period of not less than six (6) years from the Effective
Time.
(c) For six
(6) years after the Effective Time, the Surviving Corporation shall maintain
(directly or indirectly through the Company’s existing insurance programs) in
effect directors’ and officers’ liability insurance in respect of acts or
omissions occurring at or prior to the Effective Time, covering each person
currently covered by the directors’ and officers’ liability insurance policy
maintained by the Company or its subsidiaries on terms with respect to such
coverage and amounts comparable to the insurance maintained currently by the
Company or its subsidiaries, as applicable; provided that the Surviving
Corporation may substitute therefor policies of at least the same coverage
containing terms and conditions which are not less advantageous to the
beneficiaries of the current policies and with carriers having an
A.M. Best “key rating” of A X or better, provided that such
substitution shall not result in any gaps or lapses in coverage with respect to
matters occurring prior to the Effective Time, and provided, further, that the
Surviving Corporation shall first use its reasonable best efforts to obtain from
such carriers a so-called “tail” policy providing such coverage and being
effective for the full six (6) year period referred to above, and shall be
entitled to obtain such coverage in annual policies from such carriers only if
it is unable, after exerting such efforts for a reasonable period of time, to
obtain such a “tail” policy; and provided, further, that the Surviving
Corporation shall not be required to pay an annual premium in excess of 200% of
the last annual premium paid by the Company prior to the date of this Agreement
(or, in the case of a “tail” policy obtained pursuant to the preceding proviso,
shall not be required to pay an aggregate premium therefor in excess of an
amount equal to 300% of such last annual premium) and, if the Surviving
Corporation is unable to obtain the insurance required by this Section 5.04(c),
it shall obtain as much comparable insurance as possible for an annual premium
(or an aggregate premium, as the case may be) equal to such maximum
amount.
(d) The
provisions of this Section 5.04 (i) are intended to be for the benefit of, and
will be enforceable by, each indemnified party, his or her heirs and his or her
representatives, and (ii) are in addition to, and not in substitution for, any
other rights to indemnification or contribution that any such Person may have by
Contract or otherwise. It is expressly agreed that the indemnified
parties shall be third party beneficiaries of this Section 5.04.
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Section
5.05. Fees and
Expenses.
(a) Except as
otherwise provided in this Section 5.05, all fees and expenses incurred in
connection with this Agreement, the Merger and the other transactions
contemplated by this Agreement shall be paid by the party incurring such fees or
expenses, whether or not the Merger is consummated.
(b) In the
event that:
(i) this
Agreement is terminated by the Company pursuant to Section 7.01(e) or by Parent
pursuant to Section 7.01(c) or Section 7.01(f) (provided that, with respect to a
termination by Parent pursuant to Section 7.01(c) only, at the time of such a
termination the conditions set forth in Section 6.01 and Section 6.03 have been
satisfied for at least five (5) Business Days prior to such termination);
or
(ii) (A) a
Takeover Proposal shall have been made to the stockholders of the Company
generally or a Takeover Proposal shall have otherwise become publicly known,
disclosed or proposed or any Person shall have publicly announced an intention
(whether or not conditional) to make a Takeover Proposal, (B) thereafter this
Agreement is terminated by either Parent or the Company pursuant to Section
7.01(b)(i) (provided that, in the case of a termination by Parent pursuant to
Section 7.01(b)(i), at the time of such termination Parent shall have obtained
the Financing on the terms and conditions set forth in the Financing
Commitments) or Section 7.01(b)(ii) or by Parent pursuant to Section 7.01(c),
and (C) within twelve (12) months after such termination, the Company enters
into, or submits to the stockholders of the Company for adoption, a definitive
agreement with respect to any Takeover Proposal, or consummates the transactions
contemplated by any Takeover Proposal (provided that, for purposes of this
Section 5.05(b)(ii), all references to 25% in the definition of Takeover
Proposal shall be deemed to be 50%) which, in each case, need not be the same
Takeover Proposal that shall have been publicly announced or made known at or
prior to termination of this Agreement; then (in
the case of the occurrence of either or both of matters described in Sections
5.05(b)(i) and 5.05(b)(ii)) the Company shall pay Parent a one-time Company
Termination Fee (less any Expenses that may previously have been paid or are
payable in the circumstances as provided below) by wire transfer of immediately
available funds on the first Business Day following (x) in the case of a payment
required by Section 5.05(b)(i), the date of termination of this Agreement, and
(y) in the case of a payment required by Section 5.05(b)(ii) above, the date of
the consummation of such Takeover Proposal. For purposes of this
Agreement, “Company
Termination Fee” means an amount equal to $350,000; provided, if the
Company Termination Fee becomes payable by the Company in connection with a
termination under Section 7.01(e) in order to enter into a definitive agreement
with respect to a Takeover Proposal with an Excluded Party, then the Company
Termination Fee shall be $200,000. The Parent’s right to receive, and
the Company’s obligation to pay, the Company Termination Fee pursuant to this
Section 5.05(b) upon the termination of this Agreement by Parent pursuant to
Sections 7.01(c) or 7.01(f) shall be in addition to, and not in lieu of,
Parent’s and Merger Sub rights under Section 8.10
hereof. Notwithstanding any other provision of this Agreement to the
contrary, the Company shall not be obligated under this Section 5.05(b) to pay
the Company Termination Fee in the event that this
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(c) In the
event that this Agreement is terminated (i) by Parent, on the one hand, or the
Company, on the other hand, pursuant to Section 7.01(b)(ii) or pursuant to a
different section of Section 7.01 at a time when this Agreement was terminable
pursuant to Section 7.01(b)(ii), or (ii) by Parent pursuant to Section
7.01(b)(i) or Section 7.01(c) or pursuant to a different section of Section 7.01
at a time when this Agreement was terminable by the Parent pursuant to Section
7.01(b)(i) or Section 7.01(c) (provided in the case of a termination pursuant to
Section 7.01(b)(i) that a Stockholders’ Meeting at which the approval of this
Agreement is voted upon by the Company’s stockholders shall not have been duly
convened prior to the Outside Date), then in the case of any such termination of
this Agreement the Company shall pay to Parent an amount equal to the sum of
Parent’s or Merger Sub’s Expenses (not to exceed $150,000 in the aggregate) for
which Parent has not theretofore been reimbursed by the Company in cash by wire
transfer in immediately available funds, such payment to be made following such
termination within two (2) Business Days following delivery to the Company of
notice of demand for such payment. For purposes of this Agreement,
the term “Expenses” means, with
respect to a party hereto, all reasonable, documented out-of-pocket expenses
(including all reasonable fees and expenses of debt financing sources (including
those who are parties to any financing commitments), counsel, accountants,
investment bankers, experts and consultants to a party hereto) incurred by a
party or on its behalf in connection with or related to authorization,
negotiation, execution and performance of this Agreement and the transactions
contemplated hereby. Notwithstanding any other provision of this
Agreement to the contrary, the Company shall not be obligated under this Section
5.05(c) to pay any Expenses of Parent in the event that this Agreement is
terminated by Parent pursuant to Section 7.01(c) if such termination is based
upon either (1) the breach of any representation or warranty of the Company set
forth in Section 3.01 hereof, or (2) the breach or failure to perform a covenant
or agreement and such breach or failure is the proximate result of action taken
by the Company at the direction of the Chief Executive Officer without the
approval or direction of the Board of Directors of the Company (or an authorized
committee thereof).
(d) In the
event that this Agreement is terminated by the Company pursuant to (i) Section
7.01(d) (provided that at the time of such termination pursuant to Section
7.01(d) the conditions set forth in Sections 6.01 and 6.02(a), (b) and (d) have
been satisfied), or (ii) Section 7.01(b)(i) (provided that at the time of such
termination pursuant to Section 7.01(b)(i) all of the conditions set forth in
Sections 6.01 and 6.02 have been satisfied for at least five (5) Business Days
prior to such termination), then Parent shall pay to the Company a fee of
$350,000 (the “Parent
Termination Fee”) by wire transfer in immediately available funds no
later than two Business Days after such termination by the
Company. Contemporaneously with the signing of this Agreement,
Attiazaz Din is entering into a Limited Guarantee in favor of the Company
providing for, upon the terms and subject to the conditions set forth in the
Limited Guarantee, the guarantee of the payment obligations of Parent under this
Section 5.05(d) in an amount up to the Parent Termination Fee.
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(e) The
Company and Parent acknowledge and agree that the agreements contained in this
Section 5.05 are an integral part of the transactions contemplated by this
Agreement, and that, without these agreements, the Company and Parent would not
have entered into this Agreement; accordingly, if such party fails to pay when
due the amount payable pursuant to this Section 5.05, and, in order to obtain
such payment, the owed party commences a suit that results in a judgment against
the owing party for the amounts set forth in this Section 5.05, the owed party
shall pay to owing party its costs and expenses (including reasonable attorneys’
fees and expenses) incurred in connection with such suit, together with interest
on the terms set forth in this Section 5.05, from the date such payment was
required to be made until the date of receipt by the owed party of immediately
available funds in such amount at the prime rate, published in the Wall Street
Journal, in effect on the date such payment was required to be
made.
(f) Each of
the parties hereto acknowledges that the agreements contained in this Section
5.05 are an integral part of the transactions contemplated by this Agreement and
that neither the Company Termination Fee nor the Parent Termination Fee is a
penalty, but rather is liquidated damages in a reasonable amount that will
compensate Parent of the Company in the circumstances in which such termination
fee is payable for the efforts and resources expended and opportunities foregone
while negotiating this Agreement and in reliance on this Agreement and on the
expectation of the consummation of the transactions contemplated hereby, which
amount would otherwise be impossible to calculate with precision.
Section
5.06. Public
Announcements. Except
with respect to the announcement of any Change in Recommendation (or proposed
Change in Recommendation) made pursuant to, and in accordance with, the express
terms of Section 4.02 of this Agreement, Parent and the Company shall consult
with each other before issuing, and give each other the opportunity to review
and comment upon, any press release or other public statements with respect to
the transactions contemplated by this Agreement, including the Merger, and shall
not issue any such press release or make any such public statement prior to such
consultation, except as such party may reasonably conclude may be required by
applicable Law, court process or by obligations pursuant to any listing
agreement with any national securities exchange. The parties agree
that the initial press release to be issued with respect to the transactions
contemplated by this Agreement shall be in the form heretofore agreed to by the
parties.
Section
5.07. Financing.
(a) Parent
shall use its commercially reasonable efforts to consummate the Financing on the
terms and conditions described in the Financing Commitment (or on other terms
that would not adversely impact the ability of Parent to timely consummate the
transactions contemplated by this Agreement). In the event that any
portion of the Financing becomes unavailable in the manner or from the sources
contemplated in the Financing Commitment, (i) Parent shall promptly notify the
Company, and (ii) Parent shall use its commercially reasonable efforts to
arrange to obtain any such portion from alternative sources, on terms that are
no less favorable to Parent, as promptly as practicable following the occurrence
of such event, including entering into definitive agreements with respect
thereto (such definitive agreements entered into pursuant to the first or second
sentence of this Section 5.07(a) being referred to as the “Financing
Agreements”). In connection with its obligations
-31-
(b) The
Company shall, and shall cause each of its subsidiaries to, reasonably cooperate
in connection with the arrangement of the Financing as may be reasonably
requested by Parent (provided that such requested cooperation does not
unreasonably interfere with the ongoing operations of the Company and its
subsidiaries). Such cooperation by the Company and its subsidiaries
shall include, at the reasonable request of Parent, (i) using its commercially
reasonable efforts to cause to be delivered such officer’s or other certificates
as are customary in financings of such type (including a certificate of the
chief financial officer of the Company with respect to solvency matters) and as
are, in the good faith determination of the persons executing such certificates,
accurate, (ii) agreeing to enter into such agreements as are customary in
financings of such type, including definitive financing documents, lock-box,
blocked account and similar agreements, and agreeing to pledge, guarantee, grant
security interests in, and otherwise grant liens on, the Company’s or its
subsidiaries’ assets pursuant to such agreements, as may be reasonably requested
(and executing and delivering any documents or instruments, or agreeing to enter
into agreements, in connection with the foregoing); provided, that no obligation
of the Company or its subsidiaries under any such agreement, pledge, guarantee
or grant contemplated by this clause (ii) shall be effective until the Effective
Time, (iii) using its commercially reasonable efforts to cause its independent
registered public accountants to deliver such comfort letters as are customary
in financings of such type, (iv) providing Parent and its Financing sources as
promptly as practicable (and in no event later than 30 days prior to the Outside
Date) with financial and other pertinent information (including quarterly
financial statements of the Company and its subsidiaries prepared in the
ordinary course of business) with respect to the Company and its subsidiaries,
(v) making the Company’s executive officers and other relevant employees
reasonably available to assist the lenders providing the Financing, and (vi)
taking all corporate actions, subject to the occurrence of the Closing, to
permit consummation of the Financing and the direct borrowing or incurrence of
all proceeds of the Financing by the Surviving Corporation immediately following
the Effective Time.
ARTICLE
VI
CONDITIONS
PRECEDENT
Section
6.01. Conditions to Each Party’s
Obligation to Effect the Merger
. The
respective obligation of each party to effect the Merger is subject to the
satisfaction or (to the extent permitted by Law) waiver by both Parent and the
Company on or prior to the Closing Date of the following
conditions:
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(a) Stockholder
Approval. The Company shall have obtained both (i) the
Stockholder Approval, and (ii) the affirmative vote to adopt this Agreement of
the holders of a majority of the number of shares of Company Common Stock
eligible to vote at the Stockholders’ Meeting, or any adjournment or
postponement thereof, excluding for the purposes of this Section 6.01(a)(ii) any
shares of Company Common Stock eligible to be voted at the Stockholders’ Meeting
that are held by Parent, Merger Sub, Attiazaz Din, Xxxxxxx Din, Xxxxxx Din or
Ali Din or any of their respective Affiliates (the “Special Stockholder
Approval” and, together with the Stockholder Approval, the “Company Stockholder
Approvals”).
(b) No Injunctions or
Restraints. There shall not be in effect any statute,
regulation, order, decree or judgment of any Governmental Entity which makes
illegal or enjoins or prevents the consummation of the Merger.
Section
6.02. Conditions to Obligations of
Parent and Merger Sub
. The
obligations of Parent and Merger Sub to effect the Merger are further subject to
the satisfaction or (to the extent permitted by Law) waiver by Parent on or
prior to the Closing Date of the following conditions:
(a) Representations and
Warranties. The representations and warranties of the Company
contained in this Agreement that are qualified as to materiality or Material
Adverse Effect shall be true and correct, and the representations and warranties
of the Company contained in this Agreement that are not so qualified shall be
true and correct in all material respects, in each case as of the date of this
Agreement and as of the Closing Date as though made on the Closing Date, except
to the extent such representations and warranties expressly relate to an earlier
date, in which case as of such earlier date. Parent shall have received a
certificate signed on behalf of the Company by the chief executive officer and
the chief financial officer of the Company to such effect dated as of the
Closing Date.
(b) Performance of Obligations of the
Company. The Company shall have performed in all material
respects all obligations required to be performed by the Company under this
Agreement at or prior to the Closing Date. Parent shall have received
a certificate signed on behalf of the Company by the chief financial officer of
the Company to such effect dated as of the Closing Date.
(c) Appraisal
Rights. The aggregate number of shares of Company Common Stock
at the Effective Time, the holders of which have properly exercised appraisal
rights under Section 262, shall not equal 10% or more of the shares of Company
Common Stock outstanding as of the record date for the Stockholders’
Meeting.
(d) Financing. Parent
shall have obtained the Financing on the terms and conditions set forth in the
Financing Commitments.
(e) Consents. There
shall not be any consents or approvals of any third parties required in
connection with or as a result of the execution, delivery and performance of
this Agreement and the consummation by the Company of the Merger and each of the
other transactions contemplated hereby under any Contract to which the Company
or any of its subsidiaries is a party or any of their respective properties or
other assets are subject or any
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Section
6.03. Conditions to Obligation of
the Company. The
obligation of the Company to effect the Merger is further subject to the
satisfaction or (to the extent permitted by Law) waiver by the Company on or
prior to the Closing Date of the following conditions:
(a) Representations and
Warranties. The representations and warranties of Parent and
Merger Sub contained in this Agreement that are qualified as to materiality or
Parent Material Adverse Effect shall be true and correct, and the
representations and warranties of Parent and Merger Sub contained in this
Agreement that are not so qualified shall be true and correct in all material
respects, in each case as of the date of this Agreement and as of the Closing
Date as though made on the Closing Date, except to the extent such
representations and warranties expressly relate to an earlier date, in which
case as of such earlier date. The Company shall have received a certificate
signed on behalf of Parent and Merger Sub by an executive officer of Parent and
Merger Sub, respectively, to such effect.
(b) Performance of Obligations of Parent
and Merger Sub. Parent and Merger Sub shall have performed in
all material respects all obligations required to be performed by them under
this Agreement at or prior to the Closing Date, and the Company shall have
received a certificate signed on behalf of Parent and Merger Sub by its
respective Chief Executive Officer to such effect dated as of the Closing
Date.
Section
6.04. Frustration of Closing
Conditions
. Neither
the Company, on the one hand, nor Parent and Merger Sub, on the other hand, may
rely on the failure of any condition set forth in Section 6.01, Section 6.02 or
Section 6.03, as the case may be, to be satisfied if such failure was caused by
such party’s failure to act in good faith or use its reasonable best efforts to
consummate the Merger and the other transactions contemplated by this Agreement,
as required by and subject to Section 5.03.
ARTICLE
VII
TERMINATION,
AMENDMENT AND WAIVER
Section
7.01. Termination
. This
Agreement may be terminated at any time prior to the Effective Time, whether
before or after receipt of the Company Stockholder Approvals:
(a) by mutual
written consent of Parent and the Company;
(b) by either
Parent or the Company:
(i) if the
Merger shall not have been consummated on or before July 31, 2009 (the “Outside Date”);
provided, however, that the right to terminate this Agreement under this Section
7.01(b)(i) shall not be available to any party whose breach of a representation,
warranty, covenant or agreement in this Agreement has (directly or indirectly)
in whole or in material part been a cause of or resulted in the failure of the
Merger to be consummated on or before such date;
-34-
(ii) if the
Company Stockholder Approvals shall not have been obtained at the Stockholders’
Meeting duly convened therefor or at any adjournment or postponement thereof;
or
(iii) if any
Governmental Entity of competent jurisdiction shall have issued or entered an
injunction or similar legal restraint or order permanently enjoining or
otherwise prohibiting the consummation of the Merger and such injunction, legal
restraint or order shall have become final and non-appealable; provided,
however, that the party seeking to terminate this Agreement pursuant to this
Section 7.01(b)(iii) shall have used such reasonable best efforts as may be
required by Section 5.03 to prevent, oppose and remove such
injunction;
(c) by
Parent, if the Company shall have breached or failed to perform any of its
representations, warranties, covenants or agreements set forth in this
Agreement, which breach or failure to perform (i) would give rise to the failure
of any condition set forth in Section 6.02, and (ii) is uncured or incapable of
being cured by the Company prior to the earlier to occur of (A) 30 calendar days
following receipt of written notice of such breach or failure to perform from
Parent, or (B) the Outside Date; provided, however, that Parent shall not have
the right to terminate this Agreement pursuant to this Section 7.01(c) if it or
Merger Sub is then in material breach of any representation, warranty, covenant
or other agreement contained in this Agreement that would cause any of the
conditions in Section 6.03 not to be satisfied;
(d) by the
Company, if Parent or Merger Sub shall have breached or failed to perform any of
its representations, warranties, covenants or agreements set forth in this
Agreement, which breach or failure to perform (i) would give rise to the failure
of any condition set forth in Section 6.03, and (ii) is uncured or incapable of
being cured by Parent or Merger Sub prior to the earlier to occur of (A) 30
calendar days following receipt of written notice of such breach or failure to
perform from the Company, or (B) the Outside Date; provided, however, that the
Company shall not have the right to terminate this Agreement pursuant to this
Section 7.01(d) if it is then in material breach of any representation,
warranty, covenant or other agreement contained in this Agreement that would
cause any of the conditions in Section 6.02 not to be satisfied;
(e) prior to
obtaining the Company Stockholder Approvals, by the Company, in accordance with
and subject to the terms and conditions of, Section 4.02(f); or
(f) by
Parent, in the event that (i) the Independent Committee or the Company’s Board
of Directors shall have made a Change in Recommendation (or publicly proposes to
make a Change in Recommendation), or (ii) the Company has failed to comply in
any material respect with Section 4.02 (including the Company approving,
recommending or entering into any actual or proposed acquisition agreement in
violation of Section 4.02), or (iii) the Company shall have failed to comply
with Section 5.01(c) or to include the Company Board Recommendation in the Proxy
Statement.
Section
7.02. Effect of
Termination
. In
the event of termination of this Agreement by either the Company or Parent as
provided in Section 7.01, this Agreement shall forthwith become void and have no
effect, without any liability or obligation on the part of Parent or the Company
or their directors, officers or stockholders, under this Agreement,
other
-35-
than the
provisions of Section 5.05, this Section 7.02 and Article VIII, which provisions
shall survive such termination.
Section
7.03. Amendment. This
Agreement may be amended by the parties hereto at any time before or after
receipt of the Stockholder Approval; provided, however, that after the Company
Stockholder Approvals have been obtained, there shall be made no amendment that
by applicable Law requires further approval by the stockholders of the Company
without such approval having been obtained. This Agreement may not be
amended except by an instrument in writing signed on behalf of each of the
parties hereto.
Section
7.04. Extension;
Waiver. At
any time prior to the Effective Time, the parties may (a) extend the time for
the performance of any of the obligations or other acts of the other parties,
(b) to the extent permitted by applicable Law, waive any inaccuracies in the
representations and warranties contained herein or in any document delivered
pursuant hereto, or (c) subject to the proviso to the first sentence of Section
7.03 and to the extent permitted by applicable Law, waive compliance with any of
the agreements or conditions contained herein. Any agreement on the
part of a party to any such extension or waiver shall be valid only if set forth
in an instrument in writing signed on behalf of such party. The
failure of any party to this Agreement to assert any of its rights under this
Agreement or otherwise shall not constitute a waiver of such rights nor shall
any single or partial exercise by any party to this Agreement of any of its
rights under this Agreement preclude any other or further exercise of such
rights or any other rights under this Agreement.
Section
7.05. Procedure for Termination or
Amendment. A
termination of this Agreement pursuant to Section 7.01 or an amendment of this
Agreement pursuant to Section 7.03 shall, in order to be effective, require, in
the case of Parent or Merger Sub or the Company, action by its respective Board
of Directors.
ARTICLE
VIII
GENERAL
PROVISIONS
Section
8.01. Nonsurvival of
Representations and Warranties. None
of the representations and warranties in this Agreement or in any instrument
delivered pursuant to this Agreement shall survive the Effective
Time. This Section 8.01 shall not limit any covenant or agreement of
the parties which by its terms contemplates performance after the Effective
Time.
Section
8.02. Notices. Except
for notices that are specifically required by the terms of this Agreement to be
delivered orally, all notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be deemed given if
delivered personally, telecopied (which is confirmed) or sent by overnight
courier (providing proof of delivery) to the parties at the following addresses
(or at such other address for a party as shall be specified by like
notice):
|
if to
Parent or Merger Sub, to:
|
Attiazaz
Din
c/o En Pointe Technologies, Inc.
00000 X. Xxxxxxxx Xxxxxx,
Xxxxxxx, XX 00000-0000
Facsimile:
(000) 000-0000
|
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|
with
a copy (which shall not constitute notice) to:
|
Xxxxxx
Xxxxxxxx LLP
0000
Xxx Xxxxx Xxxxxx
Xxxxxxxxxxxx,
XX 00000
Facsimile:
(000) 000-0000
Attention:
Xxxxx X. Xxxxxxx
|
|
if
to the Company, to:
|
En
Pointe Technologies, Inc.
00000
X. Xxxxxxxx Xxxxxx,
Xxxxxxx,
XX 00000-0000
Facsimile:
(000) 000-0000
Attention:
Xxxxxxx X. Xxxx, Chairman of the Board
|
|
with
a copy (which shall not constitute notice) to:
|
Independent
Committee
0000
0xx
Xxxxxx, Xxxxx 000
Xxxxxxxxx
Xxxxx, XX 00000
Facsimile:
(000) 000-0000
Attention:
Xxx Xxxxxxxxx, Chairman
|
|
with
additional copies (which shall not constitute notice) to:
|
XxXxxxxxx,
Xxxxxxx & Xxxxxxx LLP
00
Xxxxxxxxxx, Xxxxx 000
Xxxxx
Xxxxx, Xxxxxxxxxx 00000
Facsimile:
(000) 000-0000
Attention:
Xxxx X. Xxxxxxx
Xxxxxxxxx
Xxxxx Xxxxxxx & Xxxxx
000
Xxxxxxx Xxxxxx Xxxxx, Xxxxx 0000
Xxxxxxx
Xxxxx, Xxxxxxxxxx 00000
Facsimile:
(000) 000-0000
Attention:
Xxxx X. Xxxxxx
|
Section
8.03. Definitions. For
purposes of this Agreement:
(a) an “Affiliate” of any
Person means another Person that directly or indirectly, through one or more
intermediaries, controls, is controlled by, or is under common control with,
such first Person. For purposes hereof, “control” means the
possession directly or indirectly, of the power to direct or cause the direction
of the management or policies of a Person by virtue of ownership of voting
securities, by contract or otherwise,
(b) “Benefit Plans” means
all employee benefit plans, as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended, and all employment benefit,
compensation, stock option, stock purchase, restricted stock, deferred
-37-
(c) “Business Day” shall
mean any day other than a Saturday, Sunday or a day on which the banks in Los
Angeles, California are authorized by Law or executive order to be
closed.
(d) “Knowledge” of the
Company or Parent means, with respect to any matter in question, the actual
knowledge of the Company’s or Parent’s respective executive officers after
making due inquiry of the other executives and managers having primary
responsibility for such matter, as well as that knowledge that a reasonably
prudent executive officer would have if such person duly performed his or her
duties as an officer of such party.
(e) “Material Adverse
Effect” means any fact, circumstance, change, occurrence or effect that,
individually or in the aggregate with all other facts, circumstances, changes,
occurrences or effects, (1) is or would reasonably be expected to be materially
adverse to the business, condition (financial or otherwise), results of
operations or liabilities (contingent or otherwise) of the Company and its
subsidiaries, taken as a whole, or (2) that would reasonably be expected to
prevent or materially impede, interfere with, hinder or delay the ability of the
Company to consummate the Merger, except for any such facts, circumstances,
changes, occurrences or effects arising out of or relating to (i) the
announcement or the existence of this Agreement and the transactions
contemplated hereby or actions by Parent or the Company required to be taken
pursuant to this Agreement (in each case, other than in respect of Section
3.01(d)), (ii) changes in general economic or political conditions or the
financial markets (so long as the Company or its subsidiaries are not
disproportionately affected thereby), (iii) changes in applicable laws, rules,
regulations or orders of any Governmental Entity or interpretations thereof by
any Governmental Entity or changes in accounting rules or principles (so long as
the Company or its subsidiaries are not disproportionately affected thereby),
(iv) changes affecting generally the industries in which the Company or its
subsidiaries conduct business (so long as the Company or its subsidiaries are
not disproportionately affected thereby); or (v) any outbreak or escalation of
hostilities or war or any act of terrorism (so long as the Company or its
subsidiaries are not disproportionately affected thereby);
(f) “Parent Material Adverse
Effect” means any fact, circumstance, change, occurrence or effect that,
individually or in the aggregate, that would reasonably be expected to prevent
or materially impede, interfere with, hinder or delay the consummation of the
Merger or the other transactions contemplated by this Agreement (other than the
inability of the Parent to obtain the Financing);
(g) “Person” means an
individual, corporation, partnership, limited liability company, joint venture,
association, trust, unincorporated organization or other entity;
-38-
(h) “Representative” means
any officer, employee, counsel, investment banker, accountant, consultant and
debt financing source and other authorized representative of any
Person;
(i) a “subsidiary” of any
Person means another Person of which such first Person directly or indirectly
owns an amount of the voting securities, other voting rights or voting
partnership interests sufficient to elect at least a majority of its Board of
Directors or other governing body (or, if there are no such voting interests,
50% or more of the equity interests thereof);
(j) “tax” means any
federal, state, local or foreign income, gross receipts, property, sales, use
license, excise, franchise employment, payroll, withholding, alternative or add
on minimum, ad valorem, transfer or excise tax, or any other tax, custom, duty,
governmental fee or other like assessment or charge of any kind whatsoever
(including withholding on amounts paid to or by any Person), together with any
related interest, penalty, addition to tax or additional amount;
and
(k) “taxing authority”
means any federal, state, local or foreign government, any subdivision, agency,
commission or authority thereof, or any quasi-governmental body exercising tax
regulatory authority.
Section
8.04. Interpretation
. When
a reference is made in this Agreement to an Article, a Section or Schedule, such
reference shall be to an Article of, a Section of, or Schedule to, this
Agreement unless otherwise indicated. The table of contents and
headings contained in this Agreement are for reference purposes only and shall
not affect in any way the meaning or interpretation of this
Agreement. Whenever the words “include”, “includes” or “including”
are used in this Agreement, they shall be deemed to be followed by the words
“without limitation”. The words “hereof”, “herein” and “hereunder”
and words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this
Agreement. All terms defined in this Agreement shall have the defined
meanings when used in any certificate or other document made or delivered
pursuant hereto unless otherwise defined therein. The definitions
contained in this Agreement are applicable to the singular as well as the plural
forms of such terms and to the masculine as well as to the feminine and neuter
genders of such term. Any Contract, instrument or Law defined or
referred to herein or in any Contract or instrument that is referred to herein
means such Contract, instrument or Law as from time to time amended, modified or
supplemented, including (in the case of Contracts or instruments) by waiver or
consent and (in the case of Laws) by succession of comparable successor Laws and
references to all attachments thereto and instruments incorporated
therein. References to a Person are also to its permitted successors
and assigns. The parties have participated jointly in the negotiation
and drafting of this Agreement; consequently, in the event of an ambiguity or
question of intent or interpretation arises, this Agreement shall be construed
as if drafted jointly by the parties hereto, and no presumption or burden of
proof shall arise favoring or disfavoring any party by virtue of the authorship
of any provision of this Agreement.
Section
8.05. Consents and
Approvals
. For
any matter under this Agreement requiring the consent or approval of any party
to be valid and binding on the parties hereto, such consent or approval must be
in writing.
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Section
8.06. Counterparts
. This
Agreement may be executed in counterparts (including by facsimile), all of which
shall be considered one and the same agreement and shall become effective when
two or more counterparts have been signed by all of the parties and delivered to
the other parties.
Section
8.07. Entire Agreement; No
Third-Party Beneficiaries
. This
Agreement (including the Schedules) and any agreements entered into
contemporaneously herewith constitute the entire agreement, and supersede all
prior agreements and understandings, both written and oral, among the parties
with respect to the subject matter of this Agreement. Except for (A)
following the Effective Time, the rights of the Company’s stockholders to
receive the Merger Consideration in accordance with Section 2.01(c), and (B) the
provisions of Section 5.04 hereof, this Agreement (including the Schedules) is
not intended to and do not confer upon any Person other than the parties hereto
any legal or equitable rights or remedies.
Section
8.08. Governing
Law
. This
Agreement shall be governed by, and construed in accordance with, the laws of
the State of Delaware, without giving effect to the conflict of law principles
that would require the application of the law of another
jurisdiction.
Section
8.09. Assignment
. Neither
this Agreement nor any of the rights, interests or obligations hereunder shall
be assigned, in whole or in part, by operation of law or otherwise by any of the
parties without the prior written consent of the other party, and any assignment
without such consent shall be null and void; provided, however, that Parent may
assign any of its rights, interest and obligations under this Agreement to any
of its Affiliates without the consent of the Company, but no such assignment
shall relieve the assigning party of its obligations
hereunder. Subject to the preceding sentence, this Agreement will be
binding upon, inure to the benefit of, and be enforceable by, the parties and
their respective successors and assigns.
Section
8.10. Enforcement; Consent to
Jurisdiction
. The
parties agree that irreparable damage would occur in the event that any of the
provisions of this Agreement to be performed by the Company or any of its
subsidiaries were not performed in accordance with their specific terms or were
otherwise breached. It is accordingly agreed that prior to the valid
and effective termination of this Agreement in accordance with Section 7.01
Parent and Merger Sub shall be entitled to an injunction or injunctions to
prevent breaches of this Agreement and to enforce specifically the terms and
provisions of this Agreement exclusively in any state or federal court sitting
in the State of California. The parties acknowledge and agree that
neither the Company nor any of its subsidiaries shall be entitled to an
injunction or injunctions to prevent breaches of this Agreement or to enforce
specifically the terms and provisions of this Agreement and their sole and
exclusive remedy with respect to any such breach shall be the monetary payments
set forth in Section 7.02. Each of the parties hereto (a) irrevocably
consents to submit itself to the personal jurisdiction of any state or federal
court sitting in the State of California in the event any dispute arises out of
this Agreement or the transactions contemplated by this Agreement, (b) agrees
that it will not attempt to deny or defeat such personal jurisdiction by motion
or other request for leave from any such court, and (c) agrees that it will not
bring any action relating to this Agreement or the transactions contemplated by
this Agreement in any court other than any state or federal court sitting in the
State of California. Any judgment from
-40-
any such
court described above may, however, be enforced by any party in any other court
in any other jurisdiction.
Section
8.11. 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. Upon such determination that any term or other provision is
invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible to the fullest extent permitted by
applicable Law in an acceptable manner to the end that the transactions
contemplated by this Agreement are fulfilled to the extent
possible.
Section
8.12. No
Recourse
. This
Agreement may only be enforced against, and any claims or causes of action that
may be based upon, arise out of or relate to this Agreement, or the negotiation,
execution or performance of this Agreement may only be made against the entities
that are expressly identified as parties hereto, and no past, present or future
Affiliate, director, officer, employee, incorporator, member, manager, partner,
shareholder, agent, attorney or representative of any party hereto shall have
any liability for any obligations or liabilities of the parties to this
Agreement or for any claim based on, in respect of, or by reason of, the
transactions contemplated hereby.
Section
8.13. WAIVER OF JURY
TRIAL
. EACH
OF THE PARTIES HERETO IRREVOCABLY WAIVES ANY AND ALL RIGHT TO TRIAL BY JURY IN
ANY LEGAL PROCEEDING BETWEEN THE PARTIES HERETO ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
[Signature
Page Follows]
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IN
WITNESS WHEREOF, each of the parties hereto has caused this Agreement and Plan
of Merger to be signed by its respective officers hereunto duly authorized, all
as of the date first written above.
DIN
GLOBAL CORP.
By: /s/ Attiazaz “Xxx”
Din
Name: Attiazaz
“Xxx” Din
Title: President
ENP
ACQUISITION, INC.
By: /s/ Attiazaz “Xxx”
Din
Name: Attiazaz
“Xxx” Din
Title: President
EN POINTE
TECHNOLOGIES, INC.
By: /s/ Xxxxxxx X.
Xxxxxxxxx
Name: Xxxxxxx
X. Xxxxxxxxx
|
|
Title:
|
Director and Chairman of the Independent Committee of the Board of
Directors
|
[Signature
Page to Agreement and Plan of Merger Agreement]
ANNEX
I
TO THE
AGREEMENT AND PLAN OF MERGER
INDEX OF
DEFINED TERMS
|
Term
|
Section
|
| Acceptable Confidentiality Agreement | Section 4.02(a) |
| Affiliate | Section 8.03(a) |
| Affiliated Company Stock Options | Section 2.03(a) |
| Agreement | Preamble |
| Appraisal Shares | Section 2.01(d) |
| Benefit Plans | Section 8.03(b) |
| Business Day | Section 8.03(c) |
| Cancelled Shares | Section 2.01(b) |
| Capitalization Date | Section 3.01(c) |
| Certificate | Section 2.01(c) |
| Certificate of Merger | Section 1.03 |
| Change in Recommendation | Section 4.02(e) |
| Closing | Section 1.02 |
| Closing Date | Section 1.02 |
| Code | Section 2.02(h) |
| Company | Preamble |
| Company Board Recommendation | Section 3.01(d)(ii) |
| Company Bylaws | Section 3.01(a) |
| Company Charter | Section 3.01(a) |
| Company Common Stock | Recitals |
| Company Information | Section 3.01(j) |
| Company Preferred Stock | Section 3.01(c) |
| Company SEC Documents | Section 3.01(e)(i) |
| Company Stockholder Approvals | Section 6.01(a) |
| Company Stock Option | Section 2.03(b) |
| Company Stock Plan | Section 2.03(b) |
| Company Stock-Based Awards | Section 3.01(c) |
| Company Termination Fee | Section 5.05(b)(ii) |
| Contract | Section 3.01(d)(iii) |
| Converted Shares | Section 2.01(c) |
| DGCL | Section 1.01 |
| Effective Time | Section 1.03 |
| Exchange Act | Section 3.01(d)(iii) |
| Exchange Fund | Section 2.02(a) |
| Excluded Party | Section 4.02(b) |
| Expenses | Section 5.05(c) |
| Filed Company SEC Documents | Section 3.01 |
| Financing | Section 3.02(d) |
| Financing Agreements | Section 5.07(a) |
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Term
|
Section
|
|
|
|
|
Financing
Commitments
|
|
|
GAAP
|
|
|
Governmental
Entity
|
|
|
Independent
Committee
|
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|
Key
Persons
|
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|
Knowledge
|
|
|
Law
|
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|
Liens
|
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Material
Adverse
Effect
|
|
|
Merger
|
Recitals
|
|
Merger
Consideration
|
Recitals
|
|
Merger
Sub
|
Preamble
|
|
New
Financing
Commitments
|
|
|
No-Shop
Period Start
Time
|
|
|
Notice
Period
|
|
|
Order
|
|
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Outside
Date
|
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Parent
|
Preamble
|
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Parent
Information
|
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Parent
Material Adverse
Effect
|
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Parent
Termination
Fee
|
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Paying
Agent
|
|
|
Person
|
|
|
Proxy
Statement
|
|
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Representative
|
|
|
Schedule
13E-3
|
|
|
SEC
|
|
|
Section
262
|
|
|
Securities
Act
|
|
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Stockholder
Approval
|
|
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Stockholders’
Meeting
|
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SOX
|
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Special
Stockholder
Approval
|
|
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Solvent
|
|
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subsidiary
|
|
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Superior
Proposal
|
|
|
Surviving
Corporation
|
|
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Takeover
Proposal
|
|
|
tax
|
|
|
taxing
authority
|
Schedule
2.03(a)
Affiliated Company Stock
Options
Attiazaz
“Xxx” Din
Xxxxxxx
Din
