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EXHIBIT A
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Crown Cork & Seal Company, Inc.
and
Compagnie Generale d'Industrie et de Participations
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EXCHANGE OFFER AGREEMENT
Dated as of May 22, 1995,
as amended as of November 13, 1995
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TABLE OF CONTENTS
Page
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Background.................................................... A-5
TERMS......................................................... A-6
1. Agreement to Make Offer................................. A-6
(a) Agreement to Make Offer................................... A-6
(b) Terms; Exchange Ratio..................................... A-7
(c) Conduct of the Offer; Amendment; Waiver................... A-8
(d) Restrictions on Amendment or Waiver of Offer.............. A-8
(e) Fractional Shares......................................... A-9
(f) Adjustments to Exchange Ratio, etc........................ A-9
(g) The U.K. Exchange Offer................................... A-9
(h) Company Options........................................... A-10
2. Agreement to Tender..................................... A-11
(a) Tender.................................................... A-11
(b) Third-Party Bids.......................................... A-11
3. Voting.................................................. A-11
4. Expiration.............................................. A-12
5. Warranties of Crown..................................... A-12
(a) Organization and Qualification............................ A-12
(b) Capitalization............................................ A-12
(c) SEC Filings............................................... A-13
(d) Financial Statements...................................... A-14
(e) Absence of Certain Changes or Events...................... A-14
(f) Absence of Litigation..................................... A-14
(g) Employee Benefit Plans.................................... A-15
(h) Articles of Incorporation and By-laws..................... A-16
(i) Taxes and Social Obligations.............................. A-16
(j) Authority Relative to this Agreement...................... A-17
(k) Consents and Approvals; No Violation...................... A-17
(l) Financial Advisors........................................ A-19
(m) Delivery of Crown Common Stock and Crown Preferred Stock.. A-19
(n) Registration Statement; Proxy Statement................... A-19
(o) Note d'Information, U.K. Filing; etc...................... A-20
6. Warranties of Shareholder............................... A-20
(a) Ownership of Shares....................................... A-20
(b) Authority Relative to this Agreement...................... A-21
(c) Consents and Approvals; No Violation...................... A-21
(d) Ownership of Crown Common Stock........................... A-22
(e) Investment Intent......................................... A-23
(f) Financial Advisors........................................ A-23
(g) Note d'Information, U.K. Filing; etc...................... A-23
(h) Registration Statement; Proxy Statement................... A-23
(i) Organizational Documents.................................. A-24
(j) Agreements................................................ A-24
7. Additional Covenants of Shareholder..................... A-24
(a) Restriction on Transfer, Proxies and Non-Interference..... A-24
(b) Additional Shares......................................... A-24
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Page
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(c) Dividends or Distributions................................ A-24
(d) Proxy; Registration Statement; Note d'Information; Etc.... A-25
(e) Conduct of Company's Business............................. A-25
(f) Access to Information Confidentiality..................... A-27
(g) Tax Position; Restructuring............................... A-27
(h) Accountants............................................... A-27
(i) Supervisory Board......................................... A-28
(j) Public Filings............................................ A-28
8. Additional Covenants of Crown........................... A-28
(a) Crown Shareholder Meeting................................. A-28
(b) Listing................................................... A-29
(c) Conduct of Crown's Business............................... A-29
(d) Access to Information; Confidentiality.................... A-30
(e) CBV Filing................................................ A-30
(f) Proxy Statement and Registration Statement................ A-31
(g) Note d'Information........................................ A-31
(h) U.K. Exchange Offer....................................... A-31
(i) Amendments................................................ A-32
(j) By-Law Amendment.......................................... A-32
(k) Accountants............................................... A-32
9. Additional Covenants of Shareholder and Crown........... A-32
(a) No Solicitation........................................... A-32
(b) Filings................................................... A-33
(c) Consents; Approvals....................................... A-34
(d) Cooperation............................................... A-35
(e) Disclosure................................................ A-35
(f) Shareholders Agreement.................................... A-35
(g) Notification.............................................. A-35
10. Conditions to Obligations of Crown...................... A-36
10.1. Conditions to Obligation of Crown
to Make the Exchange Offers............................. A-36
(a) Warranties................................................ A-36
(b) Agreements and Covenants.................................. A-36
(c) Consents Obtained......................................... A-36
(d) Shareholder Approval...................................... A-36
(e) Registration Statement; Securities Laws................... A-37
(f) No Injunctions or Restraints; Illegality.................. A-37
(g) Due Diligence............................................. A-37
(h) Status of the Company..................................... A-37
(i) Access to Information; Confidentiality.................... A-38
(j) Dividends and Other Distributions......................... A-38
(k) Market Matters............................................ A-39
(l) Listing................................................... A-39
(m) Change of Control......................................... A-39
10.2 Conditions to the Obligations of Crown to
Acquire the Common Stock Tendered Pursuant to the
Exchange Offers.......................................... A-39
11. Conditions to Obligations of Shareholder................. A-40
(a) Warranties................................................ A-40
(b) Agreements and Covenants.................................. A-40
(c) Consents Obtained......................................... X-00
X-0
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(d) Shareholder Approval...................................... A-40
(e) Registration Statement; Securities Laws................... A-41
(f) No Injunctions or Restraints; Illegality.................. A-41
(g) Due Diligence............................................. A-41
(h) Access to Information; Confidentiality.................... A-41
(i) Rating.................................................... A-41
(j) Miscellaneous............................................. A-42
(k) Listing................................................... A-42
(l) SLF....................................................... A-42
(m) Change of Control......................................... A-43
12. Further Assurances...................................... A-43
13. Termination............................................. A-43
14. Expenses................................................ A-48
15. Miscellaneous........................................... A-49
(a) Entire Agreement; Assignment;
No Third-Party Beneficiaries.............................. A-49
(b) Amendments................................................ A-50
(c) Governing Law............................................. A-50
(d) Specific Performance...................................... A-50
(e) Counterparts.............................................. A-50
(f) Descriptive Headings...................................... A-50
(g) Severability.............................................. A-50
(h) Notices................................................... A-51
(i) No Waiver................................................. A-52
(j) Nonsurvival of Warranties................................. A-52
(k) Consent to Jurisdiction and Service of Process............ A-52
16. Definitions............................................. A-53
(a) Additional Crown Information.............................. A-53
(b) Additional Company Information............................ A-53
(c) Affiliate................................................. A-54
(d) BALO Announcement......................................... A-54
(e) Beneficial Owner.......................................... A-54
(f) Business Day.............................................. A-54
(g) CBV....................................................... A-54
(h) Closing................................................... A-54
(i) Closing Date.............................................. A-54
(j) COB....................................................... A-54
(k) Commencement Date......................................... A-54
(l) Company Disclosure Information............................ A-55
(m) Due Diligence Period...................................... A-55
(n) Exchange Act.............................................. A-55
(o) Filing Date............................................... A-55
(p) London Stock Exchange..................................... A-55
(q) French Market Day......................................... A-55
(r) Group..................................................... A-55
(s) Market Closing Price...................................... A-55
(t) Material Adverse Effect................................... A-56
(u) Noon Buying Rate.......................................... A-56
(v) NYSE...................................................... X-00
X-0
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(w) Outstanding Common Stock.................................. A-56
(x) Paris Stock Exchange...................................... A-56
(y) Person.................................................... A-56
(z) SBF....................................................... A-56
(aa) SEC...................................................... A-56
(ab) Securities Act........................................... A-56
(ac) Subsidiaries............................................. A-56
(ad) SLF...................................................... A-57
(ae) United States GAAP....................................... A-57
(af) Voting Power............................................. A-57
(ag) $........................................................ X-00
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XXXXXXXX OFFER AGREEMENT
This is an EXCHANGE OFFER AGREEMENT (this "Agreement"), dated as of May 22,
1995 and amended as of November 13, 1995, between Crown Cork & Seal Company,
Inc., a corporation organized under the laws of the Commonwealth of
Pennsylvania, U.S.A. ("Crown"), and Compagnie Generale d'Industrie et de
Participations, a societe anonyme (Registre du Commerce et des Societes No. B
308 389 519) organized under the laws of the Republic of France
("Shareholder").
Background
A. Shareholder, directly and through its Subsidiaries, is the record and
beneficial owner of 26,188,956 shares of common stock, FF10 par value per share
(the "Common Stock") of CarnaudMetalbox, a societe anonyme (Registre du
Commerce et des Societes No. B 775 721 996) organized under the laws of the
Republic of France (the "Company"). Crown and Shareholder desire that, as part
of a business combination of Crown and the Company, Crown (or a wholly-owned
Subsidiary of Crown) make a public exchange offer with a secondary cash offer
as an Offre Publique d'Echange a Titre Principal et d'Achat a Titre Subsidiaire
(jointly, the "Offer", which term shall include any subsequent public exchange
offer made by Crown (or such Subsidiary) on the same terms as the original
Offer or such modified terms as would be permitted pursuant to this Agreement
in the case of a modification of the terms of the original Offer), for all of
the Outstanding Common Stock. Shareholders of the Company will be offered a
choice in the Offer for each then outstanding share of Common Stock between (i)
1.065 units (each, a "Unit"), each consisting of (x) .75 shares of Crown's
Common Stock, $5.00 par value per share (the "Crown Common Stock"), and (y) .25
shares of Crown's 4.5% Cumulative Convertible Preferred Stock, with a par value
per share equal to the average of the Market Closing Price per share of Crown
Common Stock for the most recent 20 business days on which trading of Crown
Common Stock has occurred prior to the Measurement Date (in each case, as
defined below), the terms of which are set forth in Annex 1 hereto and
authorized as set forth in Annex 2 hereto (the "Crown Preferred Stock"), and
(ii) cash in an amount of FF 225 per share of Common Stock (the "Cash Election
Price"). The Crown Common Stock and the Crown Preferred Stock making up each
Unit will be separately transferrable. The ratio of 1.065 Units for each share
of Common Stock, as such ratio shall be adjusted pursuant to the terms of this
Agreement, is hereinafter referred to as the "Exchange Ratio".
B. In addition to the Offer, Crown has undertaken, subject to the terms of
this Agreement, to launch an exchange offer in the United Kingdom (the "U.K.
Exchange Offer") which, to the extent permitted by law, shall be on terms
identical to the Offer (the Offer and the U.K. Exchange Offer are together
referred to as the "Exchange Offers").
C. As of the date hereof, Shareholder beneficially owns, directly and through
its indirectly wholly-owned Subsidiary Camebo B.V. ("Camebo"), the number of
shares of Common Stock set forth in Section A above (such shares of Common
Stock together with any other shares of Common Stock acquired after the date
hereof and prior to the termination hereof, whether arising from exercise of
options, receipt of dividends, conversion of convertible securities or
otherwise, and as adjusted by any stock split or similar event, being
collectively referred to herein as the "Shares").
D. As a condition to its willingness to make the Offer, Crown has asked that
Shareholder agree, and Shareholder has agreed, all as more fully set forth
herein and subject to the terms and conditions hereof, to (i) validly tender
its Shares, and cause its Subsidiaries to validly tender their shares, in the
Offer and elect to receive only Units and (ii) enter into a Shareholders'
Agreement with Crown with respect to Shareholder's relationship with Crown.
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TERMS
In consideration of the mutual covenants and agreements contained herein, and
intending to be legally bound hereby, Crown and Shareholder agree as follows:
1. Agreement to Make Offer.
(a) Agreement to Make Offer. Subject to the satisfaction or waiver of the
conditions set forth in Section 10.1 hereof, Crown or a wholly-owned Subsidiary
of Crown shall undertake the Offer in accordance with articles 5-1-1 to 5-2-27
of the Reglement General of the Conseil des Bourses de Valeurs and all other
applicable provisions of French and United States law and regulation for all of
the Outstanding Common Stock. The Offer shall remain open for the minimum
number of days required by applicable French law and regulation. The Offer
shall provide that the acceptance by Crown of Common Stock tendered in the
Offer shall be conditioned only upon the number of shares of Common Stock
validly tendered and not withdrawn prior to the expiration of the Offer being
at least equal to a majority of the Voting Power based on the number of shares
of Outstanding Common Stock on the date prior to the Filing Date, assuming loss
of all double voting rights with respect to the shares of Common Stock acquired
by Crown or its Subsidiaries (the "Minimum Condition").
(b) Terms; Exchange Ratio. (i) The terms of the Offer shall provide that all
of the Outstanding Common Stock may be tendered by the holder thereof and,
subject to the terms and conditions set forth in the Offer, shall entitle such
tendering holder to receive for each share of Common Stock validly tendered and
not withdrawn, at such holder's election, (x) a number of Units equal to the
Exchange Ratio as adjusted pursuant to this Section 1(b) or (y) the Cash
Election Price in cash, in French francs and without interest.
(ii) If the Average Crown Common Stock Price is greater than FF 211.27 per
share (the "Initial Price") but less than FF 232.39 per share (110% of the
Initial Price), then the Exchange Ratio will be adjusted downward accordingly.
If the Average Crown Common Stock Price is greater than or equal to FF 232.39
per share (110% of the Initial Price), the Exchange Ratio will be adjusted as
though the Average Crown Common Stock Price were equal to FF 232.39 (110% of
the Initial Price).
(iii) If the Average Crown Common Stock Price is less than the Initial Price
but greater than FF 190.14 per share (90% of the Initial Price), then the
Exchange Ratio will be adjusted upward accordingly. If the Average Crown Common
Stock Price is equal to or less than FF 190.14 per share (90% of the Initial
Price), the Exchange Ratio will be adjusted as though the Average Crown Common
Stock Price were equal to FF 190.14 (90% of the Initial Price).
(iv) In any case where the Exchange Ratio is to be adjusted pursuant to
subparagraph (ii) or (iii) of this paragraph (b), the adjusted Exchange Ratio
will be calculated by applying the following formula (rounded to the nearest
one-thousandth): the adjusted Exchange Ratio equals the Exchange Ratio
multiplied by the fraction of which the numerator is the Initial Price and the
denominator of which is the Average Crown Common Stock Price.
(v) For purposes of this Agreement: the "Average Crown Common Stock Price"
shall be the average French Franc Crown Common Stock Price (as defined below)
for the most recent 20 business days on which trading of Crown Common Stock has
occurred prior to the Measurement Date; and the "Measurement Date" shall be the
business day before the Filing Date. The "French Franc Crown Common Stock
Price", for any particular business day, shall be the product of (x) the Market
Closing Price per share of Crown Common Stock, in U.S. dollars, and (y) the
Noon Buying Rate for such business day (or if there was no trading in such
currencies on such business day, the most recent day on which trading of the
French franc and U.S. dollar has occurred).
(c) Conduct of the Offer; Amendment; Waiver. Subject to the applicable
securities and takeover laws and the regulations of the SEC, COB, CBV, SBF and
any other administrative, governmental or regulatory authority with
jurisdiction over the subject matter hereof, Crown expressly reserves the
right, in its sole discretion, at any time and from time to time, and
regardless of whether or not any of the conditions set forth in Sections 10.1
and 10.2 hereof shall have been satisfied or waived by Crown, to (i) extend the
period
A-8
of time during which the Offer is open and thereby delay acceptance for payment
of, and the payment for, any Common Stock validly tendered and not withdrawn,
and (ii) subject to Section 1(d) below, amend the Offer (including the Exchange
Ratio and the Minimum Condition) in any respect by surenchere or otherwise. In
any case where the terms of the Offer are modified, any such modification shall
be effected such that the implied value of the number of Units offered in
exchange for one share of Common Stock remains equal to the Cash Election Price
per share of Common Stock under terms of the Offer as so modified. Subject to
the provisions of this Agreement, if by the expiration of the Offer any or all
of the conditions to the Offer have not been satisfied, Crown reserves the
right (but shall not be obligated) to (i) terminate the Offer and return all
tendered Common Stock to tendering shareholders, (ii) extend the Offer and,
subject to the terms of the Offer (including the rights of shareholders to
withdraw their Common Stock), retain the Common Stock which has been tendered
and is not subsequently withdrawn until the termination of the Offer, as
extended, or (iii) commence another Offer. Crown shall have no obligation to
pay interest on the purchase price of tendered Common Stock.
(d) Restrictions on Amendment or Waiver of Offer. Without the prior written
consent of Shareholder, Crown will not decrease the Cash Election Price or the
Exchange Ratio as adjusted pursuant to Sections 1(b)(ii) or (iii), decrease the
number of shares of Common Stock being sought in the Offer, change the form of
consideration payable in the Offer or make any other change in the terms or
conditions of the Offer which is adverse to the holders of Common Stock
(including, without limitation, any change that would cause Shareholder or
Camebo to recognize taxable gain or loss in the Offer or in any subsequent
conversion of the Crown Preferred Stock into Crown Common Stock); provided,
that an increase in the value of the consideration offered in the Offer shall
not be deemed to constitute an adverse change solely because it increases the
gain or diminishes the loss that holders of Common Stock would otherwise be
required to recognize for tax purposes irrespective of such increase in
consideration. Except as provided below with respect to the Minimum Condition,
the parties agree that a waiver by Crown of any condition to the Offer in whole
or in part at any time and from time to time in its discretion shall not be
deemed to be adverse to any holder of Common Stock. Notwithstanding anything in
paragraph (c) above or this paragraph (d) to the contrary, Crown shall not
reduce or waive the Minimum Condition.
(e) Fractional Shares. No fraction of a share of Crown Common Stock or Crown
Preferred Stock will be issued in the Offer, but, in lieu thereof, each holder
of Common Stock who would otherwise be entitled to a fraction of a share of
Crown Common Stock or Crown Preferred Stock (after aggregating all fractional
shares of Crown Common Stock or Crown Preferred Stock to be received by the
holder), as the case may be, will be entitled to receive from Crown an amount
of cash in French francs (rounded to the nearest whole French franc) equal to
the product of (i) such fraction and (ii) the Average Crown Common Stock Price.
(f) Adjustments to Exchange Ratio, etc. The Exchange Ratio, the components of
a Unit, the Cash Election Price and the other terms of the Offer will be
adjusted to reflect the effect of any stock split, reverse stock split, stock
dividend (including any dividend or distribution to shareholders of securities
convertible into Crown Common Stock or Crown Preferred Stock or Common Stock),
recapitalization, or other like change with respect to Crown Common Stock or
Crown Preferred Stock or Common Stock occurring after the date of this
Agreement and prior to the Filing Date.
(g) The U.K. Exchange Offer. Crown or a wholly-owned Subsidiary of Crown
shall launch the U.K. Exchange Offer on, or as promptly as practicable after,
the Commencement Date (unless Crown shall have determined in its good faith
judgment that such U.K. Exchange Offer is not necessary after consultation with
Shareholder). The U.K. Exchange Offer shall be made, to the extent legally
permissible, on the same terms as the Offer, provided that the Cash Election
Price in the U.K. Exchange Offer shall be payable in French francs or, at
Crown's option, in pounds sterling (translated from French francs at the
exchange rate in effect on the Closing Date (as published in the Dow Xxxxx
Telerate Inc. currency cross-rates published in the Wall Street Journal (U.S.
edition)). Crown shall cause the U.K. Exchange Offer to be carried out in
accordance with all applicable requirements of United Kingdom law and
regulation. In the event that it is determined that a U.K. Exchange Offer is
not required, all references to the U.K. Exchange Offer in this Agreement shall
be null and void.
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(h) Company Options. Subject to applicable law and regulation, and subject to
the terms of the Company's employee stock options, Crown shall make an offer to
each holder of the Company's employee stock options outstanding on the date of
this Agreement, and each holder of the New Options and the 1994 Options to the
extent issued in accordance with this Agreement (the outstanding options, the
New Options and the 1994 Options are collectively referred to as the
"Outstanding Options") in respect of the Common Stock for which such
Outstanding Options have not been exercised as of the Closing Date, to settle
such holder's options, at the sole discretion of Crown, (i) for cash at a price
per share of Common Stock equal to the Cash Election Price to the extent such
options are "in the money", provided that Crown shall indemnify the holder
against all tax claims and liabilities resulting from such settlement, (ii) by
issuing options on Crown Common Stock that are exercisable at such price as
Crown determines not in excess of the then current market price for Crown
Common Stock that preserve, to the fullest extent practical, the provisions of
such holder's options as to the duration of such options, the conditions for
vesting of such options and the conditions for exercise of such options or
(iii) by offering a choice to the holder of (i) or (ii), or a combination of
(i) and (ii) in a proportion to be agreed between Crown and the option holder,
provided that in the cases described in this clause (iii) Crown shall have no
obligation to indemnify a holder who elects cash from any tax claims and
liabilities resulting from such settlement. In addition, subject to applicable
law and regulation, to the extent any employee or former employee of the
Company is prohibited under applicable law or regulation from transferring
Common Stock received upon exercise of options, Crown shall, on the date such
employee or former employee is permitted to transfer such Common Stock, offer
such employee or former employee the right to tender such Common Stock to Crown
for Units (in an amount determined by applying the Exchange Ratio as adjusted
on the Measurement Date, and provided Crown Preferred Stock is then
outstanding) or cash in an amount equal to the Cash Election Price, in each
case on the same basis offered in the Offer. Subject to compliance with the
foregoing, nothing herein shall limit Crown with respect to restricting or
terminating such options as agreed between Crown and the holders of such
options.
2. Agreement to Tender.
(a) Tender. Subject to the satisfaction or waiver on or prior to the Filing
Date of the conditions set forth in Section 11 hereof, Shareholder will validly
tender, and will cause Camebo to validly tender, and not withdraw all Shares
beneficially owned by Shareholder and Camebo (and any other Subsidiary of
Shareholder) pursuant to the Offer on or before the second French Market Day
after the Commencement Date and will irrevocably elect, and cause Camebo (and
any other Subsidiary of Shareholder) to irrevocably elect (pursuant to the
procedures specified in the Offer and described in Section 1(b) hereof), to
receive only Units in consideration for such Shares. Notwithstanding the
foregoing, Shareholder agrees that, at the direction of Crown, it will elect
pursuant to the Offer to receive the Cash Election Price in consideration for
one Share validly tendered and not withdrawn and to receive Units in
consideration for the remainder of the Shares validly tendered and not
withdrawn.
(b) Third-Party Bids. Notwithstanding anything to the contrary contained
herein, Shareholder shall at all times prior to expiration of the Offer retain
the right to withdraw its shares previously tendered into the Offer and to
tender its Shares, and to cause Camebo to tender their Shares, into a tender
offer or exchange offer launched by a third party for all of the outstanding
Common Stock (a "Third Party Bid") provided that (i) the Third Party Bid has a
greater value than the value of the Offer and Crown has not increased the
Offer, as permitted under Sections 1(c) and 1(d) above, to match the Third
Party Bid; and (ii) Crown is unable to demonstrate to Shareholder that,
immediately prior to the scheduled expiration of the Offer, the Minimum
Condition will be satisfied (assuming the Shares are tendered in the Offer).
3. Voting. At any annual or special, ordinary or extraordinary meeting of the
shareholders of the Company however called, Shareholder shall vote the Shares
against (i) any extraordinary corporate transaction, such as a merger,
consolidation or other business combination involving the Company or any of its
Subsidiaries; (ii) a sale or transfer of a material amount of assets of the
Company or any of its Subsidiaries or a reorganization, recapitalization or
liquidation of the Company or any of its Subsidiaries; (iii) any change in a
majority of the
A-10
directors or the Supervisory Board of the Company, except as otherwise agreed
to in writing by Crown; (iv) any material change in the present capitalization
of the Company (other than (x) relating to the Faba transaction, (y) the
issuance of New Options and the 1994 Options in accordance with this Agreement
and (z) the amendment to the statuts, in each case described in the BALO
Announcement) or any material change in the dividend policy of the Company; (v)
any action which would cause any of Shareholder's representations and
warranties to become untrue in any material respect or any condition to the
obligations of Shareholder or Crown to remain unsatisfied; and (vi) any other
material change in the Company's corporate structure or business, in each case
(i) to (vi) to the extent such action or agreement would impede, interfere
with, delay, postpone or attempt to discourage the Offer or the consummation of
the transactions contemplated by this Agreement.
4. Expiration. This Agreement, Crown's obligation to make the Exchange Offers
pursuant hereto, and Shareholder's obligation to tender its Shares and to cause
Camebo (and any other Subsidiary of Shareholder) to tender its Shares pursuant
to the Offer, shall terminate on the Expiration Date. As used herein, the term
"Expiration Date" means the first to occur of (i) the first date on which the
Offer has been successfully consummated (and the Closing Date with respect
thereto shall have occurred) or has expired without being successfully
consummated, and (ii) termination in accordance with Section 13.
5. Warranties of Crown. Crown hereby warrants to Shareholder as follows:
(a) Organization and Qualification. Crown is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation and has the requisite corporate power and authority to carry on
its business as it is now being conducted. Crown is duly qualified as a foreign
corporation to do business, and is in good standing, in each jurisdiction where
the character of its properties owned or leased or the nature of its activities
make such qualification necessary, except where the failure to be so qualified
would not, individually or in the aggregate, result in a Material Adverse
Effect on Crown.
(b) Capitalization. As of the date of this Agreement, the authorized capital
stock of Crown consists of 120,000,000 shares of Crown Common Stock. As of the
date of this Agreement, (i) 90,220,924 shares of Crown Common Stock were issued
and outstanding, all of which are duly authorized, validly issued, fully paid,
and nonassessable, (ii) 28,269,890 shares of Crown Common Stock were held in
the treasury of Crown or owned by Subsidiaries of Crown, and (iii) 2,119,900
options to acquire shares of Crown Common Stock have been granted and are
outstanding under Crown's various employee stock option plans. Except as set
forth in this paragraph (b), as of the date hereof, there are no subscriptions,
options, warrants, or other rights, convertible securities, agreements,
arrangements, or commitments of any character relating to the issued or
unissued capital stock of Crown to which Crown or any of its material
Subsidiaries is a party, or by which any of their properties are bound or
affected, or obligating Crown or any of its Subsidiaries to issue or sell any
shares of capital stock of, or other equity interests in, Crown.
(c) SEC Filings. Crown has filed all forms, reports, and documents required
to be filed with the SEC since December 31, 1993, and has made available to
Shareholder (i) its Annual Reports on Form 10-K for the fiscal years ended
December 31, 1993 and 1994, (ii) all proxy statements relating to meetings of
Crown's shareholders (whether annual or special) held since December 31, 1993,
(iii) all quarterly reports on Form 10-Q and current reports on Form 8-K filed
by Crown with the SEC since December 31, 1993, (iv) all registration statements
filed by Crown with the SEC since December 31, 1993 (other than registration
statements on Form S-8 relating to employee benefit plans of Crown and Form S-3
Registration Statements relating solely to the issuance of non-convertible debt
securities), and (v) all amendments and supplements to these reports and
registration statements filed by Crown with the SEC. Crown will file with the
SEC and make available to the Company all forms, reports, and documents
required to be filed with the SEC between the date of this Agreement and the
Expiration Date. The forms, reports, and documents referred to in this
paragraph are referred to collectively as the "Crown SEC Reports". The Crown
SEC Reports (including, without limitation, any financial statements or
schedules included therein) (i) were and will be prepared in compliance, in all
material respects, with the requirements of the Securities Act or the Exchange
Act, as the case may be, and (ii) did not and will not at the time of filing
(or, if amended, supplemented, or superseded by a filing prior to the date of
this Agreement, on the date of that filing) contain
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any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. As of the date hereof, none of Crown's Subsidiaries is required to
file any forms, reports, or other documents with the SEC.
(d) Financial Statements. Each of the consolidated financial statements
(including, in each case, any related notes and schedules thereto) contained in
the Crown SEC Reports was or will be prepared in accordance with United States
GAAP applied on a consistent basis throughout the periods involved (except as
may be indicated in the notes thereto), and each of them does or will present
fairly in all material respects the consolidated financial position of Crown
and its Subsidiaries at their respective dates and the consolidated results of
their operations and cash flows for the periods indicated, except that the
unaudited interim financial statements included in any Quarterly Reports on
Form 10-Q were or are subject to normal and recurring year-end adjustments that
were not or are not expected to be material in amount.
(e) Absence of Certain Changes or Events. Except as disclosed in the Crown
SEC Reports filed with the SEC prior to the date of this Agreement, disclosed
in the Additional Crown Information or as contemplated by this Agreement, since
December 31, 1994, (i) there has been no Material Adverse Effect on Crown, (ii)
the businesses of Crown and each of its Subsidiaries have been conducted only
in the ordinary course, consistent with past practice; (iii) neither Crown nor
any of its Subsidiaries has incurred any material liabilities (direct,
contingent or otherwise) or engaged in any material transaction or entered into
any material agreement outside the ordinary course of business; (iv) Crown and
its Subsidiaries have not increased in any material respect the compensation of
any officer or granted any general salary or benefits increase to their
employees other than in the ordinary course of business; and (v) there has been
no declaration, setting aside or payment of any dividend or other distribution
with respect to the capital stock of Crown.
(f) Absence of Litigation. There are no civil, criminal, or administrative
claims, actions, suits, proceedings, or investigations pending or, to the
knowledge of Crown, threatened against Crown or any of its Subsidiaries, or
involving any properties or rights of Crown or any of its Subsidiaries, before
any court, arbitrator, or administrative, governmental, or regulatory
authority, domestic or foreign, that, individually or in the aggregate, have
had or are likely to have a Material Adverse Effect on Crown. There are no
judgments, decrees, injunctions, rules, or orders of any governmental entity or
arbitrator outstanding against Crown or any of its Subsidiaries that have had
or are likely to have a Material Adverse Effect on Crown.
(g) Employee Benefit Plans.
(i) The obligations and liabilities of Crown and its Subsidiaries under
retirement, pension, profit sharing, savings, deferred compensation,
supplemental retirement, bonus, incentive, stock purchase, stock ownership,
stock option, severance, health, life insurance, disability, fringe benefit and
other material employee benefit plans, programs, or arrangements, and any
current or former executive employment, compensation, severance, consulting,
noncompetition, or indemnification agreements, whether written or unwritten,
funded or unfunded (x) maintained, sponsored, administered or contributed to by
Crown or any of its Subsidiaries, or (y) with respect to which Crown or any of
its Subsidiaries has any liability (together, the "Crown Employee Plans") have
been properly accrued and reflected in the financial statements of Crown and
its consolidated Subsidiaries for the fiscal year ended December 31, 1994 (the
"1994 Financial Statements") in accordance with United States GAAP in all
material respects.
(ii) Except for the liabilities accrued and reflected in the 1994 Financial
Statements, there are no material unfunded liabilities existing with respect to
any Crown Employee Plan.
(iii) All of the Crown Employee Plans have been operated and administered in
material compliance with their terms and are in material compliance with the
laws and governmental rules and regulations applicable to them (including all
applicable requirements for notification to participants and governmental or
regulatory authorities), and Crown and each of its Subsidiaries have performed
all material obligations required to be performed by them under, are not in any
material respect in default under or in violation of, any of the Crown Employee
Plans.
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(iv) All contributions to, and payments from, any Crown Employee Plan
required pursuant to applicable laws, rules and regulations, the terms of the
Crown Employee Plan, or any collective bargaining agreement have been made on
or before their due dates. All such contributions to, and all payments from,
the Crown Employee Plans have been properly accrued in accordance with United
States GAAP.
(v) Neither Crown nor any of its Subsidiaries has taken any action with
respect to any Crown Employee Plan that will increase materially the expense of
maintaining such Crown Employee Plan above the level of expense reflected in
the 1994 Financial Statements.
(vi) Except for claims for benefits in the normal operation of the Crown
Employee Plans, there is no litigation, proceeding, investigation, audit,
assessment, complaint or proceeding of any kind in any court or governmental
agency with respect to any Crown Employee Plan which is reasonably likely to
have a Material Adverse Effect on Crown and its Subsidiaries, taken as a whole.
(vii) Neither Crown nor any of its Subsidiaries has taken any action with
respect to any Crown Employee Plan (including but not limited to the
recognition of the transaction contemplated by this Agreement as a change of
control) that will cause a material discretionary acceleration or increase in
the vesting, exercisability, or benefits provided by any such Crown Employee
Plan.
(h) Articles of Incorporation and By-laws. Crown has heretofore delivered to
Shareholder a complete and correct copy of its Articles of Incorporation and of
its By-laws, each as amended to the date hereof. Crown is not in violation of
any of the provisions of its Articles of Incorporation or By-laws, and its
Articles of Incorporation and By-laws as so delivered have not been amended,
modified, or rescinded and remain in full force and effect; provided that
Crown's Articles of Incorporation will have been amended as set forth on Annex
1 and Annex 2 hereto and to include an "opt out" from the provisions of Chapter
25, Subchapter E of the Pennsylvania Business Corporation Law in a form to be
mutually agreed between the parties to this Agreement (the "New Articles")
prior to the successful consummation of the Offer and Crown's By-laws will be
amended on and as of the Closing Date as set forth in Annex 3 hereto (the
"By-law Amendment"), and except as contemplated pursuant to Section 8(c)
hereof.
(i) Taxes and Social Obligations. Crown and each of its material Subsidiaries
(i) has timely and correctly filed all material returns and reports relating to
Taxes (as defined below) required to be filed by it in the manner required by
the relevant taxing authorities (collectively, "Returns") and (ii) has timely
paid all Taxes shown to be due on such Returns and all material Taxes for which
no return was required to be filed. The financial statements included in the
Crown SEC Reports and the 1994 Financial Statements, to the extent required by
United States GAAP, each reflect an adequate reserve for all Taxes payable by
Crown and its Subsidiaries for all taxable periods and portions thereof through
the date of such financial statements. No material deficiencies for any Taxes
have been proposed, asserted or assessed against Crown or any of its
Subsidiaries and no requests for waivers of the time to assess such Taxes are
pending. "Taxes" shall include, but not be limited to, all income, property,
sales, excise, social security and other taxes, tariffs or governmental charges
of any nature whatsoever.
Neither Crown nor any of its material Subsidiaries (i) is, as of the date of
this Agreement, the subject of any inquiry, investigation or audit relating to
Taxes or (ii) has received notice of any proposed inquiry, investigation or
audit relating to Taxes which is reasonably likely to have a Material Adverse
Effect on Crown.
(j) Authority Relative to this Agreement. Crown has all requisite corporate
power and authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery by Crown of this
Agreement and the consummation by Crown of the transactions contemplated hereby
have been duly and validly authorized by all necessary corporate action on the
part of Crown (including the approval by the Board of Directors of Crown of the
transactions contemplated by this Agreement and all subsequent conversions of
the Preferred Stock such that Shareholder shall not be subject to Subchapter F
of Chapter 25 of the Pennsylvania Business Corporation Law) subject to
obtaining the requisite shareholder approvals and, except for such shareholder
approvals, no other corporate proceedings on the part of Crown are necessary to
authorize this Agreement or to consummate the transactions so
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contemplated by this Agreement. This Agreement has been duly and validly
executed and delivered by Crown and, assuming this Agreement constitutes a
valid and binding obligation of Shareholder, this Agreement constitutes a valid
and binding agreement of Crown enforceable against Crown in accordance with its
terms, subject, as to enforcement, to bankruptcy, insolvency, fraudulent
transfer, reorganization, moratorium and similar laws of general applicability
relating to or affecting creditor's rights and to general equity principles.
(k) Consents and Approvals; No Violation. Neither the execution and delivery
of this Agreement by Crown nor the performance by Crown of its obligations
hereunder will (i) conflict with or result in any breach of any provision of
the Articles of Incorporation or By-laws of Crown, except that the transactions
contemplated hereby may not be consummated without receipt of the Crown
Shareholder Approvals (as defined below); (ii) require any consent, approval,
authorization or permit of, or filing with or notification to, any governmental
or regulatory authority, except (v) such articles of amendment (or statement
under Section 1522 of the Pennsylvania Business Corporation Law) as may be
required to be filed with the Secretary of State of the Commonwealth of
Pennsylvania in connection with the adoption of the New Articles at the Crown
Shareholder Meeting (as defined below), (w) in connection with the
Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as amended (the "HSR
Act"), EC Council Regulation 4064/89 and such other filings as may be required
by the antitrust or competition laws, rules or regulations of the United
States, France, the European Union and any other applicable jurisdiction, (x)
as may be required to be filed with the Direction du Tresor in connection with
the approval of Crown's acquisition of the Shares or the Common Stock or as may
be required to be filed by the investment laws, rules or regulations of any
other applicable jurisdiction, (y) such filings and approvals as may be
required under the "blue sky", takeover, company or securities and stock
exchange laws, rules or regulations of the United States, France (including the
regulations of the COB, CBV and SBF), the United Kingdom, the European Union,
and any other applicable jurisdiction, or (z) where the failure to obtain such
consent, approval, authorization or permit, or to make such filing or
notification, would not (A) prevent or delay consummation of the transactions
contemplated by this Agreement, (B) otherwise prevent or delay Crown from
performing its obligations under this Agreement, or (C) individually or in the
aggregate, have a Material Adverse Effect on Crown; (iii) except as disclosed
in writing by Crown to Shareholder prior to the execution of this Agreement,
result in a default (or give rise to any right of termination, cancellation or
acceleration) under any of the terms, conditions or provisions of any note,
bond, mortgage, indenture, contract, agreement, lease, license, permit,
franchise, or other instrument or obligation to which Crown or any of its
Subsidiaries is a party or by which any of its Subsidiaries or any of their
respective assets may be bound, except for such defaults (or rights of
termination, cancellation or acceleration) as to which requisite waivers or
consents have been obtained or which, in the aggregate, would not result in a
Material Adverse Effect on Crown or materially impair or delay Crown's ability
to perform its obligations hereunder; or (iv) violate any order, writ,
injunction, decree, statute, rule or regulation applicable to Crown, any of its
Subsidiaries or any of their respective assets, except for violations which
would not result in a Material Adverse Effect on Crown or materially impair or
delay Crown's ability to perform its obligations hereunder.
(l) Financial Advisors. Except for customary brokerage fees which Crown
elects to pay pursuant to the Offer, no investment banker, broker, finder, or
financial advisor other than CS First Boston Inc., Societe Generale or their
respective affiliates is entitled to any brokerage, finder's, or other fee or
commission in connection with the transactions contemplated by this Agreement
based upon arrangements made by or on behalf of Crown and, except as provided
in Section 14(c)(2), such fees or commissions of CS First Boston Inc., Societe
Generale and their respective affiliates shall be paid by Crown.
(m) Delivery of Crown Common Stock and Crown Preferred Stock. The issue and
delivery to Shareholder of shares of Crown Common Stock and Crown Preferred
Stock in connection with the transactions contemplated hereby have been duly
authorized by all requisite corporate action of Crown, subject to the receipt
by Crown of the requisite approvals of its shareholders. The shares of Crown
Common Stock and Crown Preferred Stock, as and when issued and delivered to
Shareholder pursuant to this Agreement, and upon receipt by Crown of the Common
Stock tendered and exchanged therefor, will be validly issued and outstanding,
fully paid and non-assessable, and the holders of Common Stock who tender
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for Units will receive good and marketable title to such shares of Crown Common
Stock and Crown Preferred Stock, free and clear of all security interests,
liens, claims, pledges, agreements, limitations on voting rights, charges,
preemptive rights or other encumbrances of any nature whatsoever, except such
as may have been created by such tendering holder.
(n) Registration Statement; Proxy Statement. The information to be supplied
by or on behalf of Crown for inclusion in the Registration Statement will not,
at the time the Registration Statement is declared effective, at the Filing
Date, the Commencement Date or the Closing Date, 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 the light of
the circumstances under which they were made, not misleading. The information
to be supplied by or on behalf of Crown for inclusion in the Proxy Statement
will not, on the date the Proxy Statement (or any amendment thereof or
supplement thereto) is first mailed to shareholders, at the time of the Crown
Shareholder Meeting, at the Filing Date, the Commencement Date and the Closing
Date, contain any statement that, in light of the circumstances under which it
is made, is false or misleading with respect to any material fact, omits to
state any material fact necessary in order to make the statements made therein
not false or misleading, or omits to state any material fact necessary to
correct any statement in any earlier communication with respect to the
solicitation of proxies for the Crown Shareholder Meeting that has become false
or misleading. If any event relating to Crown or any of its affiliates,
officers, or directors is discovered by Crown that should be set forth in an
amendment to the Registration Statement or a supplement to the Proxy Statement,
Crown will promptly inform Shareholder.
(o) Note d'Information, U.K. Filing; etc. The information supplied by or on
behalf of Crown for inclusion in the Note d'Information to be filed in
connection with the Exchange Offers (the "Note d'Information"), the CBV Filing,
the U.K. Filing and all other filings made in connection with the Exchange
Offers will not, at the time such filings receive the regulatory approval or
clearance required by applicable law, at the Filing Date, the Commencement Date
or the Closing Date, 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 the light of the circumstances under which they
were made, not misleading.
6. Warranties of Shareholder. Shareholder hereby warrants to Crown as
follows:
(a) Ownership of Shares. The Shares are owned, directly and through Camebo,
of record and beneficially by Shareholder, free and clear of all security
interests, liens, claims, pledges, agreements, limitations on voting rights,
charges, or other encumbrances of any nature whatsoever; provided, however,
that 2,464,000 Shares held of record through Camebo are pledged (the "Pledge")
to secure outstanding indebtedness of Shareholder's Subsidiaries; provided,
further, that the Pledge will not exist on the Closing Date. The Shares
constitute all of the shares of Common Stock owned of record or beneficially by
Shareholder and its affiliates. The transfer of the Shares to Crown against
payment therefor on the Closing Date pursuant to the Offer as provided in this
Agreement, will pass good and marketable title to such Shares, free and clear
of all security interests, liens, claims, pledges, agreements, limitations on
voting rights, charges, or other encumbrances of any nature whatsoever other
than those created by Crown. Shareholder has sole voting power and sole power
of disposition, in each case directly or through its Subsidiaries, with respect
to all of the Shares, and there are no restrictions on Shareholder's rights of
disposition pertaining thereto, other than in the shareholders' agreement,
dated April 1, 1993, with Parfinance, a copy of which has been provided to
Crown prior to the date of this Agreement. The transactions contemplated by
this Agreement will not affect the voting rights of any of the Shares;
provided, however, that Crown shall not be entitled to double voting rights
with respect to the Shares. Shareholder is not a party to or otherwise bound by
any voting agreement or restriction which affects the voting rights of the
Shares. Shareholder has entered into an amendment agreement with Parfinance
amending their agreement of April 1, 1993, whereunder Shareholder has obtained
from Parfinance a waiver from any right of first refusal with respect to, or
other right to purchase, the Shares which may arise as a result of the
execution of this Agreement or the consummation of the transactions
contemplated hereby, and has agreed with Parfinance to a termination of their
shareholders' agreement dated April 1, 1993, upon the successful completion of
the Offer as
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indicated by the publication of the avis of the SBF. A copy of such amendment
agreement has been provided to Crown prior to the date of this Agreement.
(b) Authority Relative to this Agreement. Shareholder is a societe anonyme
duly organized, validly existing and in good standing under the laws of the
Republic of France and has the requisite corporate power and authority to carry
on its business as it is now being conducted. Shareholder has all requisite
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery by
Shareholder of this Agreement and the consummation by Shareholder of the
transactions contemplated hereby have been duly and validly authorized by all
necessary corporate action on the part of Shareholder and no other corporate
proceedings on the part of Shareholder are necessary to authorize this
Agreement or to consummate the transactions so contemplated by this Agreement.
This Agreement has been duly and validly executed and delivered by Shareholder
and, assuming this Agreement constitutes a valid and binding obligation of
Crown, this Agreement constitutes a valid and binding agreement of Shareholder
enforceable against Shareholder in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, fraudulent transfer, reorganization,
moratorium and similar laws of general applicability relating to or affecting
creditor's rights and to general equity principles.
(c) Consents and Approvals; No Violation. Neither the execution and delivery
of this Agreement by Shareholder nor the performance by Shareholder of its
obligations hereunder will (i) conflict with or result in any breach of any
provision of the statuts or similar organizational documents of Shareholder,
(ii) require any consent, approval, authorization or permit of, or filing with
or notification to, any governmental or regulatory authority, except (w) in
connection with the HSR Act, EC Council Regulation 4064/89 and such other
filings as may be required by the antitrust or competition laws, rules or
regulations of the United States, France, the European Union and any other
applicable jurisdiction, (x) as may be required to be filed by the investment
laws, rules or regulations of any applicable jurisdiction, (y) such filings and
approvals as may be required under the "blue sky", takeover, company or
securities and stock exchange laws, rules or regulations of the United States,
France (including the regulations of the COB, CBV and SBF), the United Kingdom,
the European Union, and any other applicable jurisdiction, or (z) where the
failure to obtain such consent, approval, authorization or permit, or to make
such filing or notification, would not (A) prevent or delay consummation of the
transactions contemplated by this Agreement, (B) otherwise prevent or delay
Shareholder from performing its obligations under this Agreement, and (C)
individually or in the aggregate, have a Material Adverse Effect on
Shareholder; (iii) except as disclosed in writing by Shareholder to Crown prior
to the execution of this Agreement result in a default (or give rise to any
right of termination, cancellation or acceleration) under any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise, or other instrument or obligation
to which Shareholder or any of its Subsidiaries is a party or by which any of
its Subsidiaries or any of their respective assets may be bound, except for
such defaults (or rights of termination, cancellation or acceleration) as to
which requisite waivers or consents have been obtained or which, in the
aggregate, would not result in a Material Adverse Effect on Shareholder or
materially impair or delay Shareholder's ability to perform its obligations
hereunder; (iv) violate any order, writ, injunction, decree, statute, rule or
regulation applicable to Shareholder, any of its Subsidiaries or any of their
respective assets, except for violations which would not result in a Material
Adverse Effect on Shareholder or the Company or materially impair or delay
Shareholder's ability to perform its obligations hereunder or (v) result in
Shareholder being required to commence a tender offer for any shares of Common
Stock.
(d) Ownership of Crown Common Stock. None of Shareholder, its controlled
affiliates or Subsidiaries beneficially owns any shares of Crown Common Stock
(other than any beneficial ownership thereof that results from the execution
and performance of this Agreement).
(e) Investment Intent. Shareholder is acquiring the Crown Common Stock, Crown
Preferred Stock (and the underlying Crown Common Stock into which such Crown
Preferred Stock may be converted) for investment, and not with a view to any
distribution that would violate the Securities Act or any applicable state
securities law. Shareholder is not a "U.S. person" as such term is used in
Regulation S under the Securities Act.
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(f) Financial Advisors. No investment banker, broker, finder, or financial
advisor other than Lazard Freres & Co. LLC and Lazard Freres & Cie. is entitled
to any brokerage, finder's, or other fee or commission in connection with the
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of Shareholder. Except as provided in Sections 14(a) and 14(c)(i),
such fees or commissions of Lazard Freres & Co. LLC and Lazard Freres & Cie.
shall be paid by Shareholder.
(g) Note d'Information, U.K. Filing; etc. The information to be supplied by
or on behalf of Shareholder for inclusion in the Note d'Information, the CBV
Filing, the U.K. Filing and all other filings to be made in connection with the
Exchange Offers will not, at the time such filings receive the regulatory
approval or clearance required by applicable law, at the Filing Date, the
Commencement Date or the Closing Date, 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 the light of the
circumstances under which they were made, not misleading.
(h) Registration Statement; Proxy Statement. The information to be supplied
by or on behalf of Shareholder for inclusion in the Registration Statement will
not, at the time the Registration Statement is declared effective, at the
Filing Date, the Commencement Date or the Closing Date, 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 the
light of the circumstances under which they were made, not misleading. The
information to be supplied by or on behalf of Shareholder for inclusion in the
Proxy Statement will not, on the date the Proxy Statement (or any amendment
thereof or supplement thereto) is first mailed to shareholders, at the time of
the Crown Shareholder Meeting or at the Filing Date, the Commencement Date or
the Closing Date, contain any statement that, in light of the circumstances
under which it is made, is false or misleading with respect to any material
fact, omits to state any material fact necessary in order to make the
statements made therein not false or misleading, or omits to state any material
fact necessary to correct any statement in any earlier communication with
respect to the solicitation of proxies for the Crown Shareholder Meeting that
has become false or misleading. If any event relating to the Company or any of
its affiliates, officers, or directors is discovered by Shareholder that should
be set forth in an amendment to the Registration Statement or a supplement to
the Proxy Statement, Shareholder will promptly inform Crown.
(i) Organizational Documents. Shareholder has heretofore delivered to Crown a
complete and correct copy of the statuts, and other organizational documents of
the Company, each as amended to the date of this Agreement.
(j) Agreements. There are no material agreements between Shareholder, on the
one hand, and the Company and its Subsidiaries, on the other hand, other than
the letter agreement from Shareholder to the Company, dated May 20, 1995,
relating to the payment of fees for services provided to the Company by
Shareholder, a copy of which has been provided to Crown prior to the date of
this Agreement.
7. Additional Covenants of Shareholder. Except in accordance with the terms
of this Agreement, Shareholder hereby covenants and agrees as follows:
(a) Restriction on Transfer, Proxies and Non-Interference. While this
Agreement is in effect, and except as permitted hereby, Shareholder will not
(i) sell, transfer, pledge, encumber, assign or otherwise dispose of, or enter
into any contract, option or other arrangement or understanding with respect to
the sale, transfer, pledge, encumbrance, assignment or other disposition of any
of the Shares or (ii) grant any proxies, deposit any Shares into a voting trust
or enter into a voting agreement with respect to any Shares.
(b) Additional Shares. While this Agreement is in effect, Shareholder will
promptly notify Crown of the number of any new shares of Common Stock or any
other equity interests in the Company acquired by Shareholder, if any, after
the date hereof. Any such shares of Common Stock shall become Shares for
purposes of this Agreement.
(c) Dividends or Distributions. In the event that Shareholder receives any
dividend or other distribution in respect of the Shares after the date hereof
(other than the Company's regular dividend of
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FF 4.40 per share proposed to be paid after approval thereof at the Company's
annual general meeting of shareholders to be held on June 2, 1995) and the
Shares are subsequently acquired by Crown in the Offer, Shareholder agrees that
any such dividend or other distribution shall be deemed to be included in the
Shares and shall be transferred or paid over to Crown at the time of Closing
or, in the event such dividend or distribution is received by Shareholder after
such Closing, immediately upon receipt by Shareholder.
(d) Proxy; Registration Statement; Note d'Information; Etc. Shareholder shall
provide, and shall use its reasonable best efforts, to the extent practicable
and to the extent permitted under French law and regulation, to cause the
Company to provide, to Crown all information relating to Shareholder and the
Company, respectively, required in order for Crown to prepare the Proxy
Statement, the Registration Statement, the Note d'Information, the CBV Filing,
the U.K. Filing and all other filings required to be made in connection with
the Exchange Offers and the laws and regulations applicable thereto, including
the requirements of any stock exchange or similar self-regulatory body. If, at
any time prior to the date of closing of each of the Exchange Offers or such
later date as shall be necessary to consummate the transactions contemplated
hereby, Shareholder shall become aware that any event has occurred as a result
of which the Registration Statement (including the Prospectus contained
therein), the Proxy Statement, the Note d'Information, the CBV Filing, the U.K.
Filing or any other filing required in connection with the Exchange Offers, in
each case as then amended or supplemented, would include an untrue statement of
a material fact or omit to state any material fact necessary in order to make
the statements therein, in the light of the circumstances under which they were
made, not misleading, in each case relating to the information provided by or
on behalf of Shareholder or the Company, or, if for any other reason it shall
be necessary during such period to amend or supplement any such document
relating to Shareholder or the Company in order to comply with applicable law
or regulation, Shareholder shall notify, and shall use its reasonable best
efforts, to the extent practicable and to the extent permitted under French law
and regulation, to cause the Company to notify Crown and shall provide or cause
to be provided to Crown the information necessary to prepare such amendments or
supplements which will correct such statement or omission or effect such
compliance. Shareholder shall cause its designees for the Board of Crown to
deliver consents to be named in the Registration Statement and the Proxy
Statement.
(e) Conduct of Company's Business. Shareholder shall use its reasonable best
efforts, to the extent practicable and to the extent permitted under French law
and regulation, to cause the Company and its Subsidiaries to conduct their
respective businesses in the ordinary course, consistent with past practice;
provided, however, that this paragraph shall not in any way require Shareholder
to restrict or prohibit the Company from taking any action (x) which will not
result in a Material Adverse Effect on the Company or (y) contemplated by this
Agreement or the Shareholders Agreement. Between the date of this Agreement and
the Closing Date, Shareholder shall use its reasonable best efforts, to the
extent practicable and to the extent permitted under French law and regulation
(and except as Crown shall agree in writing), to cause the Company not to: (i)
except as described in the BALO Announcement, amend or otherwise change the
statuts (or similar organizational documents) of the Company or any of its
material Subsidiaries; (ii) sell, encumber, pledge, or otherwise dispose of any
material operating assets of the Company or any of its Subsidiaries, except for
sales of assets in the ordinary course of business consistent with past
practices; (iii) issue, sell, pledge, dispose of, or encumber, or authorize the
issuance, sale, pledge, disposition, or encumbrance of, any shares of capital
stock of, any options (including employee stock options), warrants, convertible
securities, or other rights to acquire any shares of capital stock of, or any
other ownership interest in, the Company or any of its Subsidiaries, or
otherwise alter its capital structure, except for the issuance of shares of
Common Stock upon exercise of options that were authorized to be granted under
the Company's stock option plans prior to the date of this Agreement and are
outstanding on the date of this Agreement, the issuance of shares of Common
Stock in connection with the Faba transaction described in the BALO
Announcement and the issuance of additional options referred to in the BALO
Announcement; (iv) amend the terms of, split, combine, or reclassify any of its
capital stock or issue, or authorize or propose the issuance of, any other
securities in respect of, in lieu of, or in substitution for shares of its
capital stock, except the issuance of shares of Common Stock in connection with
the Faba transaction described in the BALO Announcement and the issuance of
additional shares of Common Stock resulting from the exercise
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of the options referred to in the BALO Announcement; (v) acquire (by merger,
purchase of stock or assets, joint venture, or otherwise) any corporation,
partnership, or other business organization or division thereof; (vi)
materially change its method of accounting as in effect at December 31, 1994
except as may be required by International Accounting Standards and as is
concurred to by the Company's independent auditors, other than to convert the
Company's accounts to United States GAAP or to modify the Company's accounts to
comply with modifications to International Accounting Standards; and (vii)
change the annual accounting period.
(f) Access to Information Confidentiality. Prior to the Expiration Date,
Shareholder shall use its reasonable best efforts, to the extent practicable
and to the extent permitted under French law and regulation, to cause the
Company and its Subsidiaries to, (i) give the officers, employees, accountants,
counsel, and other representatives of Crown reasonable access to the
properties, books, contracts, and records of the Company and its Subsidiaries,
(ii) furnish promptly to Crown all information concerning the business,
properties, and personnel of the Company and its Subsidiaries as Crown may
reasonably request, and (iii) make available to Crown appropriate individuals
for the discussion of the business, properties, and personnel of the Company
and its Subsidiaries as Crown may reasonably request. Information obtained by
Crown pursuant to this paragraph shall be subject to the provisions of the
letter agreement dated May 18, 1995 addressed to Crown by the Company (the
"Company Confidentiality Agreement").
(g) Tax Position; Restructuring. Shareholder shall use its reasonable best
efforts, to the extent practicable and to the extent permitted under French law
and regulation, to cause the Company and its Subsidiaries to (i) provide such
information to Crown as Crown shall request relating to the tax position of the
Company and its Subsidiaries and (ii) engage in such internal corporate
restructuring transactions immediately prior to the Closing, including but not
limited to mergers or liquidations of Subsidiaries and distributions or sales
of the stock of Subsidiaries, as Crown shall identify in order to minimize
Taxes payable by Crown and its affiliates (including the Company and its
Subsidiaries) following completion of the Offer, provided that such
transactions shall not have an adverse effect on the Company or Shareholder.
Shareholder shall use its reasonable best efforts, to the extent practicable
and to the extent permitted under French law and regulation, to cause the
Company and its Subsidiaries to cooperate with Crown in connection with the
restructuring or refinancing of, or the obtaining of required waivers or
consents in connection with, any indebtedness or material contracts or
agreements of the Company and its Subsidiaries which may be in default or which
may become in default as a result of the consummation of the transactions
contemplated hereby.
(h) Accountants. Shareholder shall use its reasonable best efforts, to the
extent practicable and to the extent permitted under French law and regulation,
to cause the Company to cause to be delivered to Crown (i) a report of the
Company's independent accountants that complies in form and substance with the
requirements for such a report included in a registration statement on Form
S-4, (ii) the consent of such accountants to include such report in the
Registration Statement and Proxy Statement and (iii) a comfort letter from such
accountants with respect to the financial information regarding the Company
included in the Proxy Statement and the Registration Statement.
(i) Supervisory Board. Promptly following the purchase by Crown of Common
Stock pursuant to the Exchange Offers, Shareholder shall cooperate fully in
assisting Crown to cause such number of persons designated by Crown, rounded up
to the next whole number, to be elected to the Supervisory Board of the Company
as will give Crown representation on the Supervisory Board (giving effect to
the persons designated and elected pursuant to this paragraph) multiplied by
the percentage that the aggregate number of shares of Common Stock beneficially
owned by Crown and its affiliates bears to the total number of shares of Common
Stock then outstanding. Shareholder shall use its best efforts to obtain the
resignation of the number of members of the Supervisory Board as are necessary
to permit the Crown designees to be elected.
(j) Public Filings. Shareholder shall use its reasonable best efforts to the
extent practicable and to the extent permitted under French law and regulation
to cause the Company to file with the French and U.K. Securities Authorities
and make available to Crown all forms, reports, and documents required to be
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filed with the French and U.K. Securities Authorities between the date of this
Agreement and the Expiration Date. The forms, reports and documents referred to
in this paragraph or otherwise filed with the French and U.K. Authorities since
December 31, 1993 are referred to collectively as the "Company Public Reports".
8. Additional Covenants of Crown.
(a) Crown Shareholder Meeting. Crown will take all action necessary in
accordance with applicable law and its Articles of Incorporation and By-laws to
convene a meeting of its shareholders (the "Crown Shareholder Meeting") as
promptly as practicable to consider and vote upon the approval of the
transactions contemplated hereby and the adoption of the New Articles
(including the increase in the number of authorized shares of Crown Common
Stock, the authorization of shares of Crown Preferred Stock and the "opt-out"
from the provisions of Chapter 25, Subchapter E of the Pennsylvania Business
Corporation Law thereby rendering such provisions inapplicable to the
transactions contemplated hereby) and the issuance of the Crown Common Stock
and Crown Preferred Stock pursuant to the Exchange Offers and the issuance of
the Crown Common Stock upon conversion of the Crown Preferred Stock. The Board
of Directors of Crown shall recommend the approval by the Crown Shareholders of
the transactions contemplated hereby and the adoption of the New Articles and
shall take all lawful action to solicit, and use its reasonable best efforts to
obtain, such approvals. The Board of Directors acting on behalf of Crown may at
any time prior to the adjournment of the Crown Shareholder Meeting withdraw,
modify, or change any recommendation if the Board of Directors determines that
the failure to so withdraw, modify, or change its recommendation and
declaration would cause the Board of Directors to breach its fiduciary duties
to Crown's shareholders under applicable law and, notwithstanding anything
contained in this Agreement to the contrary, any such withdrawal, modification,
or change of recommendation shall not constitute a breach of this Agreement by
Crown.
(b) Listing. Crown will file listing applications (subject to applicable
listing rules), (i) as promptly as practicable, with the NYSE and (ii) in
connection with the CBV Filing with the Paris Stock Exchange, with respect to,
and Crown shall use its reasonable best efforts to cause the NYSE and the Paris
Stock Exchange to list, the Crown Common Stock and Crown Preferred Stock
issuable in connection with the Exchange Offers and the Crown Common Stock
issuable upon conversion of the Crown Preferred Stock.
(c) Conduct of Crown's Business. Crown shall conduct and shall cause its
Subsidiaries to conduct their respective businesses in the ordinary course of
business, consistent with past practice; provided, however, that this paragraph
shall not in any way restrict or prohibit Crown from taking any action (x)
which will not result in a Material Adverse Effect on Crown or adversely affect
Crown's ability to comply with its obligations under this Agreement or the
Shareholders' Agreement, or (y) contemplated by this Agreement or the
Shareholders' Agreement. Between the date of this Agreement and the Closing
Date, Crown shall not, without the prior written consent of Shareholder: (i)
amend or otherwise change the Articles of Incorporation or By-laws (or similar
organizational documents) of Crown or any of its material Subsidiaries (except
for the amendment to the By-laws effected July 27, 1995, the amendment to the
Articles of Incorporation to be effected by the New Articles and the amendment
to the By-laws to be effected by the By-law Amendment), provided that Crown may
amend the provisions of its By-laws relating to (x) indemnification of
directors and (y) the percentage vote of the Board of Directors of Crown
required to approve any amendment to the By-laws previously provided to
Shareholder and provided, further, that Crown and Shareholder will discuss in
good faith any other amendments to the By-laws Crown may wish to effect on or
prior to the Closing Date (including those provided to Shareholder prior to the
date hereof), or (ii) issue, sell, pledge, dispose of, or encumber, or
authorize the issuance, sale, pledge, disposition, or encumbrance, or authorize
the issuance of, any shares of capital stock of, any options (including
employee stock options), warrants, convertible securities, or other rights to
acquire any shares of capital stock of, or any other ownership interest in,
Crown or otherwise alter its capital structure, except for the issuance of
shares pursuant to options that were granted under Crown's stock option plans
prior to the date of this Agreement and are outstanding on the date of this
Agreement, it being understood that Crown intends to adopt a shareholder
protection rights plan (possibly including the authorization of a series of
junior preferred stock in connection therewith, which junior preferred stock
shall be junior to the Crown Preferred Stock),
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in a form reasonably acceptable to Shareholder. Shareholder consents to any
amendment of Crown's Articles of Incorporation to authorize the issuance of
shares of preferred stock junior to, or on a parity with, the Crown Preferred
Stock (in a form reasonably acceptable to Shareholder) to be submitted to the
shareholders of Crown at the Crown Shareholder Meeting.
(d) Access to Information; Confidentiality. Prior to the Expiration Date,
Crown will, and will cause each of its Subsidiaries to (i) give the officers,
employees, accountants, counsel, and other representatives of Shareholder and
the Company reasonable access to the properties, books, contracts, and records
of Crown and its Subsidiaries, (ii) furnish promptly to Shareholder and the
Company all information concerning the business, properties, and personnel of
Crown and its Subsidiaries as Shareholder or the Company may reasonably
request, and (iii) make available to Shareholder and the Company appropriate
individuals for the discussion of the business, properties and personnel of
Crown and its Subsidiaries as Shareholder or the Company may reasonably
request. Information obtained by Shareholder or the Company pursuant to this
paragraph shall be subject to the provisions of the letter agreement dated
April 18, 1995 addressed to Shareholder by Crown (the "Crown Confidentiality
Agreement") and the Company Confidentiality Agreement.
(e) CBV Filing. Upon the terms and subject to the conditions set forth in
this Agreement, Crown will prepare and file a dossier and projet d'offre with
the CBV (the "CBV Filing") which complies with applicable French law and
regulation. The CBV Filing shall be made at the earliest practicable time
following satisfaction of the conditions set forth in Section 10.1 and in no
event later than five French Market Days after Shareholder notifies Crown in
writing that, to the best of Shareholder's knowledge, such conditions and its
conditions in Section 11 have been satisfied unless within such period of time
Crown notifies Shareholder in writing that, to the best of its knowledge, such
conditions have not been satisfied. After the date of the CBV Filing, Crown
will use its reasonable best efforts to cause the dossier and projet d'offre to
be approved as promptly as practicable; provided, however, that it shall not be
deemed "reasonable" to require Crown to amend the terms of, or increase the
consideration payable in, the Offer.
(f) Proxy Statement and Registration Statement. Crown will prepare and file
with the SEC a proxy statement (the "Proxy Statement") complying with
Regulation 14A under the Exchange Act ("Regulation 14A") for use in connection
with the Crown Shareholder Meeting and a registration statement (the
"Registration Statement") in connection with the registration under the
Securities Act of the Crown Common Stock and Crown Preferred Stock issuable in
connection with the Exchange Offers and the Crown Common Stock issuable upon
conversion or exchange of the Crown Preferred Stock. Crown will use its
reasonable best efforts to cause the Registration Statement to be declared
effective, and to maintain effectiveness through the date of closing of each of
the Exchange Offers and also will take any other action required to be taken
under United States federal or state securities laws, and to cause the Proxy
Statement to be mailed to shareholders of Crown.
(g) Note d'Information. Upon the terms and subject to the conditions set
forth in this Agreement, Crown will prepare and file a Note d'Information with
the COB which complies with applicable French law. After the date of the CBV
Filing, Crown will use its reasonable best efforts to cause the Note
d'Information to be approved as promptly as practicable, and also will take any
other action required to be taken under French and other securities laws with
respect to the Offer; provided, however, that it shall not be deemed
"reasonable" to require Crown to amend the terms of, or increase the
consideration payable in, the Offer.
(h) U.K. Exchange Offer. Crown will make all filings required with the London
Stock Exchange (the "U.K. Filing") and take such other actions in the United
Kingdom as are required under applicable laws, rules and regulations in the
U.K. in connection with the U.K. Exchange Offer.
(i) Amendments. If, at any time prior to the date of closing of each of the
Exchange Offers or such later date as shall be necessary to consummate the
transactions contemplated hereby, Shareholder shall become aware that any event
has occurred as a result of which the Registration Statement (including the
Prospectus contained therein), the Proxy Statement, the Note d'Information, the
CBV Filing, the U.K. Filing or any other filing required in connection with the
Exchange Offers, in each case as then amended or
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supplemented, would include an untrue statement of a material fact or omit to
state any material fact necessary in order to make the statements therein, in
the light of the circumstances under which they were made, not misleading, or,
if for any other reason it shall be necessary during such period to amend or
supplement any such document in order to comply with applicable law or
regulation, Crown shall notify the Company and Shareholder and shall prepare
and, if required, file such amendments or supplements which will correct such
statement or omission or effect such compliance.
(j) By-Law Amendment. Effective as of the Closing, the Board of Directors of
Crown shall adopt the By-law Amendment.
(k) Accountants. Crown shall use its reasonable best efforts to cause Crown's
independent accountants to deliver to Shareholder and each of its designees for
election to the Board of Directors of Crown a comfort letter in customary form
from such accountants with respect to the financial information regarding Crown
included in the Registration Statement, provided that if any such letter is
delivered to Crown or a director of Crown, Crown shall cause Crown's
Independent Accountants to deliver such letter to Shareholder and each of its
designees and authorize Shareholder and each of such designees to rely thereon.
9. Additional Covenants of Shareholder and Crown.
(a) No Solicitation. Shareholder will not, and will use its reasonable best
efforts, to the extent practicable and to the extent permitted under French law
and regulation, to cause the Company not to, directly or indirectly, solicit
(including by way of furnishing information) any inquiries or the making of any
proposal by any person or entity (other than Crown or any affiliate of Crown)
or enter into any agreement, arrangement or understanding, or any negotiations
or discussions which might lead to such agreement, arrangement or
understanding, which constitutes, or may reasonably be expected to lead to, any
direct or indirect sale or other transfer of the Shares (or other equity
interests in the Company) or any other extraordinary transaction involving the
Shares (or other equity interests in the Company) or the Company, including
without limitation the acquisition or sale of a material amount of assets, the
sale, issuance or transfer of any equity securities (other than pursuant to
employee benefit arrangements in the ordinary course of business and other than
as disclosed by the Company in the Company Disclosure Information), or any
tender or exchange offer, merger or other business combination, involving the
Company or any of its Subsidiaries. If Shareholder or the Company receives an
inquiry or proposal with respect to any such sale of Shares or other
extraordinary transaction involving the Shares or the Company, then Shareholder
or the Company, as the case may be, shall promptly inform Crown of the terms
and conditions, if any, of such inquiry or proposal and the identity of the
person making it. Shareholder will immediately cease, and will use its
reasonable best efforts, to the extent practicable and to the extent permitted
under French law and regulation, will cause the Company to terminate any
existing activities, discussions or negotiations with any parties conducted
heretofore with respect to any of the foregoing.
(b) Filings. Upon the terms and subject to the conditions set forth in this
Agreement, each of Shareholder and Crown will, and Shareholder will use its
reasonable best efforts to the extent practicable and to the extent permitted
under French law to cause the Company to, make all necessary filings with
respect to the Exchange Offers and the transactions contemplated by this
Agreement under the applicable United States, French, United Kingdom and
European Union or other foreign securities laws, rules and regulations and will
use their reasonable best efforts to obtain any required approvals and
clearances with respect thereto under such securities laws, rules and
regulations. Notwithstanding the preceding sentence, if an exemption from the
registration requirements under the Securities Act is available on a basis that
would not (A) impede, impair or delay the Exchange Offers, (B) prevent the
listing of the Crown Common Stock and Crown Preferred Stock to be delivered in
the Exchange Offers on the NYSE, or (C) adversely affect the value of the Crown
Common Stock and Crown Preferred Stock to be received by Shareholder and its
Subsidiaries pursuant to the Exchange Offers due to restrictions on transfer,
lack of liquidity, limitations on marginability and similar limitations, there
shall be no requirement to prepare or file a Registration Statement with
respect to the Crown Common Stock or Crown Preferred Stock under this Agreement
(and
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the warranties, covenants and conditions contained herein with respect to the
Registration Statement shall be deemed to be modified accordingly).
(c) Consents; Approvals. Upon the terms and subject to the conditions set
forth in this Agreement, Shareholder and Crown will, and Shareholder will use
its reasonable best efforts to the extent practicable and to the extent
permitted under French law and regulation to cause the Company to, use their
respective reasonable best efforts to obtain all consents, waivers, approvals,
authorizations, or orders (including, without limitation, all approvals and
orders by governmental and regulatory authorities, domestic or foreign) and
Crown and Shareholder will make or cause to be made all filings (including,
without limitation, all filings required under the HSR Act and EC Council
Regulation 4064/89 and under any other antitrust or competition laws and all
other filings with governmental or regulatory authorities, domestic and
foreign) required in connection with the authorization, execution, and delivery
of this Agreement by Crown and Shareholder and the consummation by them of the
transactions contemplated by it. Notwithstanding the foregoing, and provided
Crown has complied fully with its obligations in the next succeeding sentence
of this Section 9(c), nothing contained in this Agreement will require or
obligate Crown (i) to agree to or otherwise become subject to any material
limitations on (A) the right of Crown, or its affiliates effectively to control
or operate the business, assets or operations of Crown, the Company or any of
their respective Subsidiaries as a result of any consent, waiver, approval,
authorization or order of a governmental or regulatory authority obtained in
order to satisfy a condition set forth in Section 10.1 hereof, (B) the right of
Crown or its affiliates to acquire or hold the business, assets or operations
of the Company, (C) the right of Crown to exercise full rights of ownership of
the Common Stock acquired by Crown including, without limitation, the right to
vote any Common Stock held by Crown on all matters properly presented to the
Company's shareholders, or (ii) to agree to divest itself of any Common Stock.
Notwithstanding the foregoing, if required by any such governmental or
regulatory authorities in order to obtain a necessary consent, waiver,
approval, authorization or order thereof, Crown shall agree to sell or
otherwise dispose of, hold separate (through the establishment of a trust or
otherwise), or divest itself of all or any portion of the business, assets, or
operations of the Company or Crown (or its affiliates) as shall be required to
obtain such consent, waiver, approval, authorization or order; provided,
however, that Crown shall not be required so to agree, if such action will
result in a material diminution in the value of Crown and the Company as a
combined entity.
(d) Cooperation. 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 party in doing, all things necessary,
proper or advisable to consummate, in the most expeditious manner practicable,
the transactions contemplated by this Agreement. Crown and Shareholder will use
their best efforts and cooperate with one another (i) in promptly determining
whether any additional filings are required to be made or consents, approvals,
waivers, permits or authorizations are required to be obtained (or, which if
not obtained, would result in an event of default, termination or acceleration
of any agreement or any put right under any agreement) under any applicable law
or regulation or from any governmental authorities or third parties, and (ii)
in promptly making any such filings, in furnishing information required in
connection therewith and in timely seeking to obtain any such consents,
approvals, permits or authorizations.
(e) Disclosure. Crown and Shareholder will consult with each other before
issuing any press release or making any public filing relating to this
Agreement or the transactions contemplated hereby and shall not issue any such
press release prior to such consultation.
(f) Shareholders Agreement. On the Closing Date, Crown and Shareholder shall
execute and deliver the Shareholders Agreement in the form attached hereto as
Annex 4 with such changes therein as shall be mutually agreed by Crown and
Shareholder (the "Shareholders Agreement").
(g) Notification. Each of Crown and Shareholder will, in the event of, or
promptly after obtaining knowledge of the occurrence (or non-occurrence) or
threatened occurrence (or non-occurrence) of, any fact or event which would
cause or constitute a material breach of any of its representations and
warranties or covenants set forth herein or the failure of the conditions to
the other party's obligations set forth herein,
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would constitute or result in a Material Adverse Effect on it or could result
in a delay in carrying out the transactions contemplated hereby, give notice
thereof to the other party hereto and will use its reasonable best efforts to
prevent or promptly to remedy such breach or satisfy such conditions; provided,
however, that the delivery of, or failure to deliver, any notice pursuant to
this Section 9(g) shall not limit or otherwise affect the remedies available
hereunder.
10. Conditions to Obligations of Crown.
10.1. Conditions to Obligation of Crown to Make the Exchange Offers.
The obligation of Crown to make the Exchange Offers is subject to the
satisfaction or waiver of the following conditions:
(a) Warranties. The warranties of Shareholder contained in this Agreement
that are not qualified by materiality shall be true and correct in all material
respects, and the warranties of Shareholder contained in this Agreement that
are qualified by materiality shall be true and correct, in each case on and as
of the Filing Date with the same force and effect as if made on and as of the
Filing Date, except for (i) changes contemplated by this Agreement, (ii) those
warranties that address matters only as of a particular date (which will remain
true and correct as of that date), and (iii) breaches or inaccuracies of
warranties contained in Section 6(a) and 6(b) which shall be absolutely true
and correct; and Crown shall have received a certificate to this effect signed
by the President of Shareholder.
(b) Agreements and Covenants. Shareholder shall have performed or complied in
all material respects with all of its obligations under this Agreement to be
performed or complied with on or prior to the Filing Date; and Crown shall have
received a certificate to this effect signed by the President of Shareholder.
(c) Consents Obtained. All material consents, waivers, approvals,
authorizations, or orders required to be obtained by Shareholder or the
Company, and all filings required to be made by Shareholder or the Company, for
the authorization, execution, and delivery of this Agreement by Shareholder,
the performance of Shareholder's and the Company's obligations under this
Agreement and the consummation by the Company and Shareholder of the
transactions contemplated hereby shall have been obtained and made by
Shareholder or the Company, as the case may be.
(d) Shareholder Approval. The transactions contemplated hereby and the New
Articles (including the increase in the number of authorized shares of Crown
Common Stock, the authorization of shares of Crown Preferred Stock and the
"opt-out" from the provisions of Chapter 25, Subchapter E of the Pennsylvania
Business Corporation Law thereby rendering such provisions inapplicable to the
transactions contemplated hereby) and the issuance of the Crown Common Stock
and the Crown Preferred Stock (and any Crown Common Stock into which such Crown
Preferred Stock is convertible) pursuant to this Agreement shall have been
adopted and approved by the requisite vote of the shareholders of Crown in
accordance with applicable law, the Pennsylvania Business Corporation Law,
Crown's Articles of Incorporation and By-laws and any applicable rules or
regulations of the NYSE (collectively, the "Crown Shareholder Approvals").
(e) Registration Statement; Securities Laws. Subject to Section 9(b) hereof,
the Registration Statement shall have been declared effective and no stop order
suspending effectiveness shall have been issued, no action, suit, proceeding or
investigation by the SEC to suspend the effectiveness thereof shall have been
threatened or initiated, and all necessary approvals under United States
federal or state securities laws (including the Securities Act or Exchange Act)
or French securities laws (including all required approvals of the COB, CBV or
SBF) relating to the Offer or the issuance or trading of the Crown Common
Stock, Crown Preferred Stock or the Crown Common Stock to be issued upon the
conversion of the Crown Preferred Stock shall have been received (it being
understood that the approvals of the U.K. Exchange Offer and the listing of the
Crown Common Stock and Crown Preferred Stock on the London Stock Exchange shall
not be a condition to Crown's obligation to launch the Offer).
(f) No Injunctions or Restraints; Illegality. There shall not exist any
temporary restraining order, preliminary or permanent injunction, other order
issued by any court of competent jurisdiction, or other legal
A-24
restraint or prohibition (including any antitrust authority with jurisdiction
over the Offer) prohibiting Crown from launching the Offer.
(g) Due Diligence. The due diligence and other procedures set forth in
Section 13(j) shall not be pending.
(h) Status of the Company. Except with respect to matters disclosed in the
Company's annual reports for fiscal years ended December 31, 1993 and December
31, 1994, copies of which were provided to Crown prior to the execution of this
Agreement, the statements regarding the Company contained in Annex 5 hereto
that are not qualified by materiality shall be true and correct in all material
respects and the statements regarding the Company contained in Annex 5 hereto
that are qualified by materiality shall be true and correct, on and as of the
date hereof and the Filing Date, except for (i) changes contemplated by this
Agreement, and (ii) those statements that address matters only as of a
particular date (which will remain true and correct as of that date). For
purposes of determining whether this condition is satisfied as to any statement
included in Annex 5, Additional Company Information shall not be taken into
account unless further information that is not Additional Company Information
when considered together with such Additional Company Information (taking into
account any materiality standards included in such statement) results in a
breach of such statement; and Shareholder shall use its reasonable best
efforts, to the extent practicable and to the extent permitted under French law
and regulations, to cause the Company to provide a certificate to this effect
(if true) signed by the President or a Vice President of the Company.
(i) Access to Information; Confidentiality. During the Due Diligence Period,
the Company and its Subsidiaries shall have, (i) given the officers, employees,
accountants, counsel, and other representatives of Crown reasonable access to
the properties, books, contracts, and records of the Company and its
Subsidiaries, (ii) furnished promptly to Crown all information concerning the
business, properties, and personnel of the Company and its Subsidiaries as
Crown may reasonably request, and (iii) made available to Crown appropriate
individuals for the discussion of the business, properties, and personnel of
the Company and its Subsidiaries as Crown may reasonably request. Information
obtained by Crown as described in the prior sentence shall be subject to the
provisions of the Company Confidentiality Agreement.
(j) Dividends and Other Distributions. The Company shall not have (x)
declared, set aside, or paid any dividend or other distribution (whether in
cash, stock, property, or any combination thereof) in respect of any of its
capital stock between the date hereof and the Filing Date, or indicated its
intention to do so within three months of the Filing Date, except that (A) the
Company may pay its regular dividend of FF 4.40 per share of Common Stock
proposed to be paid after approval thereof at the Company's annual general
meeting of Shareholders to be held on June 2, 1995, (B) a direct or indirect
wholly-owned subsidiary of the Company may declare and pay a dividend to its
parent, and (C) other Subsidiaries may declare and pay customary, regular
dividends in the ordinary course, consistent with past practice or (y) amended
the terms of, repurchased, redeemed, or otherwise acquired, or permitted any
subsidiary to amend the terms of, repurchase, redeem, or otherwise acquire, any
of its capital stock.
(k) Market Matters. There shall not have occurred (i) any general suspension
of trading in, or limitation on prices for, securities on the NYSE or Paris
Stock Exchange, (ii) a declaration of a banking moratorium or any suspension of
payments in respect of banks in the United States or France, or (iii) any
material limitation by any French or United States governmental, administrative
or regulatory authority or agency on the extension of credit by banks or other
lending institutions.
(l) Listing. The shares of Crown Common Stock and Crown Preferred Stock
issuable in connection with the Offer and the Crown Common Stock issuable upon
conversion of the Crown Preferred Stock shall have been accepted for listing on
the NYSE subject to official notice of issuance (provided Crown has complied
with its obligations in Section 8(b)).
(m) Change of Control. (i) Shareholder shall not have been a party to any
merger, consolidation or share exchange, and shall not have sold all or
substantially all of its assets, under circumstances in which Persons who were
members of the Shareholder's Board of Directors at the date of this Agreement
do not constitute a majority of Shareholder's Board of Directors (or body
performing similar functions) of the
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corporation or other entity surviving such transaction, and (ii) it shall not
have been publicly disclosed that 25% or more of the outstanding shares of
Shareholder's Common Stock have been acquired by any Person or Group (other
than Crown and its Affiliates).
10.2. Conditions to the Obligations of Crown to Acquire the Common Stock
Tendered Pursuant to the Exchange Offers.
The obligation of Crown to acquire the Common Stock tendered pursuant to the
Exchange Offers is subject to the satisfaction or waiver of the following
conditions:
(a) Upon completion of the Offer, the SBF shall have published a notice (avis
de resultat) confirming that the number of shares of Common Stock validly
tendered to the Offer, when added together with the Common Stock acquired by
Crown in the U.K. Exchange Offer and any other contemporaneous exchange offer
made by Crown or one of its subsidiaries in another jurisdiction, equals or
exceeds the Minimum Condition.
(b) With respect to the U.K. Exchange Offer, the Closing of the Offer shall
have occurred or shall occur contemporaneously with the closing thereof.
11. Conditions to Obligations of Shareholder. The obligation of Shareholder
to tender its Shares pursuant to the Offer is subject to the satisfaction or
waiver of the following conditions on or prior to the Filing Date:
(a) Warranties. Except to the extent disclosed in writing by Crown to
Shareholder prior to the date of the Agreement, the warranties of Crown
contained in this Agreement that are not qualified by materiality shall be true
and correct in all material respects, and the warranties of Crown contained in
this Agreement that are qualified by materiality are true and correct, on and
as of the Filing Date with the same force and effect as if made on and as of
the Filing Date, except for (i) changes contemplated by this Agreement, (ii)
those warranties that address matters only as of a particular date (which will
remain true and correct as of that date), and (iii) breaches or inaccuracies of
warranties contained in Section 5(j) and 5(m) which shall be absolutely true
and correct; and Shareholder shall have received a certificate to this effect
signed by the President or any vice president of Crown. For purposes of
determining whether this condition is satisfied as to any warranty, Additional
Crown Information shall not be taken into account unless further information
that is not Additional Crown Information when considered together with such
Additional Crown Information (taking into account any materiality standards
included in such warranty) results in a breach of such warranty.
(b) Agreements and Covenants. Crown shall have performed or complied in all
material respects with all of the obligations under this Agreement to be
performed or complied with by it on or prior to the Filing Date; and
Shareholder shall have received a certificate to this effect signed by the
President or any vice president of Crown.
(c) Consents Obtained. All material consents, waivers, approvals,
authorizations, or orders required to be obtained under, and all filings
required to be made, by Crown for the authorization, execution, and delivery of
this Agreement by Crown, the performance of Crown's obligations under this
Agreement and the consummation by Crown of the transactions contemplated hereby
shall have been obtained and made by Crown.
(d) Shareholder Approval. The Crown Shareholder Approvals shall have been
obtained.
(e) Registration Statement; Securities Laws. Subject to Section 9(b) hereof,
the Registration Statement shall have been declared effective and no stop order
suspending effectiveness shall have been issued, no action, suit, proceeding or
investigation by the SEC to suspend the effectiveness thereof shall have been
threatened or initiated, and all necessary approvals under United States
federal or state securities laws (including the Securities Act or Exchange Act)
or French securities laws (including all required approvals of the COB, CBV or
SBF) relating to the Offer or the issuance or trading of the Crown Common
Stock, Crown Preferred Stock or the Crown Common Stock to be issued upon the
conversion of the Crown Preferred Stock shall have been received (it being
understood that the approvals of the U.K. Exchange Offer
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and the listing of the Crown Common Stock and Crown Preferred Stock on the
London Stock Exchange shall not be a condition to Shareholder's obligation to
tender its Shares pursuant to the Offer).
(f) No Injunctions or Restraints; Illegality. There shall not exist any
temporary restraining order, preliminary or permanent injunction, other order
issued by any court of competent jurisdiction, or other legal restraint or
prohibition (including any antitrust authority with jurisdiction over the
Offer) prohibiting Shareholder from tendering into the Offer.
(g) Due Diligence. The due diligence and other procedures set forth in
Section 13(j) shall not be pending.
(h) Access to Information; Confidentiality. During the Due Diligence Period,
Crown and its Subsidiaries shall have caused each of its Subsidiaries to have,
(i) given the officers, employees, accountants, counsel, and other
representatives of Shareholder reasonable access to the properties, books,
contracts, and records of Crown and its Subsidiaries, (ii) furnished promptly
to Shareholder all information concerning the business, properties, and
personnel of Crown and its Subsidiaries as Shareholder may reasonably request,
and (iii) made available to Shareholder appropriate individuals for the
discussion of the business, properties, and personnel of Crown and its
Subsidiaries as Shareholder may reasonably request. Information obtained by
Shareholder as described in the prior sentence shall be subject to the
provisions of the Crown Confidentiality Agreement.
(i) Rating. The long-term unsecured senior debt securities of Crown shall not
have been downgraded (a "Downgrade") by either Xxxxx'x Investors Services Inc.
or Standard and Poor's to a rating below "investment grade", provided that
Shareholder shall not be entitled to rely on this condition unless it shall,
prior to such reliance, have entered into good faith negotiations with Crown
for a reasonable period of time in an effort to modify the terms of the
transaction in a manner sufficient to alleviate such Downgrade. "Investment
grade" shall mean either Xxxxx'x Investors Services Inc. or Standard and Poor's
shall have rated the security in one of its generic rating categories which
signifies investment grade (typically the four highest categories).
(j) Miscellaneous. There shall not have occurred (i) any general suspension
of trading in, or limitation on prices for, securities on the NYSE or Paris
Stock Exchange, (ii) a declaration of a banking moratorium or any suspension of
payments in respect of banks in the United States or France, or (iii) any
material limitation by any French or United States governmental, administrative
or regulatory authority or agency on the extension of credit by banks or other
lending institutions.
(k) Listing. The shares of Crown Common Stock and Crown Preferred Stock
issuable in connection with the Offer and the Crown Common Stock issuable upon
conversion of the Crown Preferred Stock shall have been accepted for listing on
the NYSE subject to official notice of official issuance, and Crown shall have
applied for the listing thereof on the Paris Stock Exchange.
(l) SLF. Prior to October 1, 1995, the SLF shall have confirmed that French
corporate shareholders of the Common Stock, including Shareholder, (i) shall be
entitled to defer recognition of any gain or loss on the Common Stock upon
tendering the Common Stock into the Offer and electing to receive Units until
the sale by such corporate shareholders of the Crown Common Stock and the Crown
Preferred Stock received in the Offer and (ii) shall be entitled to defer
recognition of any gain or loss on any such Crown Preferred Stock upon
conversion of the Crown Preferred Stock into Crown Common Stock until the sale
by such corporate holders of such Crown Common Stock. Promptly following the
date of this Agreement, and in any case within 15 calendar days, Shareholder
shall make a submission to the SLF seeking the foregoing confirmation and shall
use its reasonable best efforts to secure the requested confirmation as soon
thereafter as practicable. Shareholder shall furnish to Crown copies of its
submission and, promptly upon receipt thereof, any response received from the
SLF. In the event that Shareholder shall be notified by the SLF that the
requested confirmation will not be forthcoming, such that the condition
provided for in this paragraph (l) cannot be satisfied, Shareholder shall
notify Crown as promptly as practicable. If requested by Crown in writing,
Shareholder shall advise Crown within 10 calendar days after receipt of such
request whether Shareholder is willing to waive the condition provided for in
this paragraph (l) and, if Shareholder is not willing to waive such condition,
Shareholder shall terminate this Agreement pursuant to Section 13(f).
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(m) Change of Control. (i) Crown shall not have been a party to any merger,
consolidation or share exchange, and shall not have sold all or substantially
all of its assets, under circumstances in which Persons who were members of the
Crown's Board of Directors at the date of this Agreement do not constitute a
majority of Crown's Board of Directors (or body performing similar functions)
of the corporation or other entity surviving such transaction, and (ii) it
shall not have been publicly disclosed that 25% or more of the outstanding
shares of Crown Common Stock have been acquired by any Person or Group (other
than Shareholder and its Affiliates).
12. Further Assurances. From time to time, at any other party's request and
without further consideration, each party hereto shall execute and deliver such
additional documents and take all such further action as may be necessary or
desirable to consummate and make effective, in the most expeditious manner
practicable, the transactions contemplated by this Agreement.
13. Termination. This Agreement may be terminated, by written notice to the
other party hereto, at any time:
(a) Prior to the Filing Date by Crown if there has been (i) a breach of any
covenant or agreement herein on the part of Shareholder that would result in a
failure of the conditions set forth in Section 10.1(a) or Section 10.1(b) and
which has not been cured within 30 calendar days following receipt of notice of
such breach or (ii) a material breach of a warranty herein on the part of
Shareholder that would result in a failure of the condition set forth in
Section 10.1(a) which breach by its nature is not reasonably likely to be cured
prior to March 31, 1996; Shareholder, Camebo, the Company or any of the
Company's material Subsidiaries makes a general assignment for the benefit of
creditors, or any proceeding shall be instituted by or against Shareholder,
Camebo, the Company or any of its material Subsidiaries seeking to adjudicate
any of them a bankrupt or insolvent, or seeking liquidation, winding up or
reorganization, arrangement, adjustment, protection, relief or composition of
its debts under any law relating to bankruptcy, insolvency or reorganization
(and if such proceeding is against Shareholder, Camebo, the Company or any of
the Company's material Subsidiaries, it remains unstayed and in effect for
sixty consecutive days after institution of such proceeding).
(b) By Crown if (i) Crown has commenced the Offer and the Offer is terminated
or expires in accordance with its terms without Crown having purchased any
Common Stock thereunder due to a failure of the conditions of the Offer
(including the Minimum Condition) to be satisfied or (ii) Shareholder tenders
any of its Shares to a Third Party Bid.
(c) Prior to the Filing Date by Shareholder if (i) there has been (A) a
breach of any covenant or agreement herein on the part of Crown that would
result in a failure of the condition set forth in Section 11(a) or Section
11(b) and which has not been cured within 30 calendar days following receipt of
notice of such breach or (B) a material breach of a warranty herein on the part
of Crown that would result in a failure of the condition set forth in Section
11(a) which breach by its nature cannot be cured prior to March 31, 1996; or
(ii) Crown or any of its material Subsidiaries makes a general assignment for
the benefit of creditors, or any proceeding shall be instituted by or against
Crown or any of its material Subsidiaries seeking to adjudicate any of them a
bankrupt or insolvent, or seeking liquidation, winding up or reorganization,
arrangement, adjustment, protection, relief or composition of its debts under
any law relating to bankruptcy, insolvency or reorganization (and if such
proceeding is against Crown or any such material Subsidiary, it remains
unstayed and in effect for sixty consecutive days after the institution of such
proceeding).
(d) By Shareholder if Crown has commenced the Offer and the Offer (as the
same may have been modified or extended in accordance with this Agreement or
replaced by a New Offer) is terminated or expires in accordance with its terms
without Crown having purchased any Common Stock thereunder due to a failure of
the conditions of the Offer (including the Minimum Condition) to be satisfied.
(e) By either Shareholder or Crown if (i) the Closing Date shall not have
occurred on or prior to March 31, 1996 (the "Final Termination Date");
provided, however, that if Crown shall have commenced the
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Offer prior to the Final Termination Date and the Offer shall not have
terminated or expired prior to the Final Termination Date, then the Final
Termination Date shall be extended until the termination or expiration of the
Offer in accordance with its terms, provided that Crown shall not have
voluntarily extended the time period of the Offer if the Final Termination Date
would occur prior to such extension (unless such extension is in connection
with an increase in the amount of consideration payable to shareholders of the
Company (including Shareholder) tendering in the Offer in response to a Third
Party Bid provided that the Final Termination Date shall not be later than the
termination date of such Third Party Bid), and, provided, further that the
right to terminate this Agreement under this paragraph (e)(i) shall not be
available to any party whose failure to fulfill any obligation or condition
under this Agreement shall have been the cause of, or shall have resulted in,
the failure of the Closing Date to occur on or prior to such date, or (ii) the
Crown Shareholder Approvals have not been obtained by reason of the failure to
obtain the required votes upon the vote of Crown's shareholders at the Crown
Shareholder Meeting, provided that, with respect to any termination by Crown
under this paragraph (e)(ii) that Crown shall have complied with its
obligations under Section 8(a) hereof.
(f) Prior to the Filing Date by either Shareholder or Crown in the event that
any governmental, regulatory or judicial authority or tribunal shall have
issued a final, non-appealable order, decree or ruling or taken any other
final, non-appealable action restraining, enjoining or otherwise prohibiting
the Offer by Crown or the tender by Shareholder of the Shares into the Offer.
(g) By the mutual written consent of Shareholder and Crown.
(h) On the date immediately prior to the Filing Date by Crown if, on the
preceding NYSE trading day (the "Final Determination Date"), the Average Crown
Common Stock Price (computed with the Final Determination Date being deemed the
Measurement Date) is greater than FF 242.96 (115% of the Initial Price).
(i) On the date immediately prior to the Filing Date by Shareholder if, on
the Final Determination Date, the Average Crown Common Stock Price (computed
with the Final Determination Date being deemed the Measurement Date) is less
than FF 179.58 and Crown shall not by 12:00 Midnight, New York City time, on
the date prior to the Filing Date have delivered to Shareholder a written
agreement by Crown to amend the Exchange Ratio such that the implied value of
the number of shares of Crown Common Stock and the number of shares of Crown
Preferred Stock deliverable in exchange for one share of Common Stock is not
less than FF 212.50. For this purpose, such implied value shall be computed on
the basis of the Average Crown Common Stock Price, with the Final Determination
Date being deemed to be the Measurement Date, and the ratio of the number of
shares of Crown Common Stock to the number of shares of Crown Preferred Stock
per Unit shall remain constant at .75 to .25.
(j)(i) By Shareholder on the last day of the Due Diligence Period if
Shareholder's outside accountants (the "Shareholder Accountants") have advised
Shareholder that, based solely upon such accountants' analysis (the
"Shareholder Accountants Analysis") of the total mix of Additional Crown
Information, which shall be reflected in such accountants' written opinion
delivered to Crown and to Shareholder, and after having reviewed its analysis
and evaluation with Crown's outside accountants (the "Crown Accountants"), the
Shareholder Accountants are of the good faith judgment (the "Shareholder
Accountants Judgment") that the net adverse effect on the value of Crown
attributable to the Additional Crown Information, after giving effect to any
increases in value attributable to positive aspects of the Additional Crown
Information, exceeds $250 million; provided that within five days after receipt
of notice of termination, Crown may deliver to Shareholder notice that Crown
disagrees with the Shareholder Accountants Judgment (in which case the
provisions of subparagraph (iv) below shall apply) and provided, further, that
if Crown does not deliver such notice of disagreement within five days after
receipt of the notice of termination, this Agreement shall terminate.
(ii) By Crown on the last day of the Due Diligence Period if the Crown
Accountants have advised Crown that, based solely upon such accountants'
analysis (the "Crown Accountants Analysis") of the total mix of Additional
Company Information, which shall be reflected in such accountants' written
opinion delivered to Shareholder and Crown, and after having reviewed its
analysis and evaluation with the
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Shareholder Accountants, the Crown Accountants are of the good faith judgment
(the "Crown Accountants Judgment") that the net adverse effect on the value of
the Company attributable to the Additional Company Information, after giving
effect to any increases in value attributable to positive aspects of the
Additional Company Information, exceeds $250 million; provided that within five
days after receipt of notice, Shareholder may deliver to Crown notice that
Shareholder disagrees with the Crown Accountants Judgment (in which case the
provisions of subparagraph (iv) below shall apply) and provided, further, that
if Shareholder does not deliver such notice of disagreement within five days
after receipt of the notice of termination, this Agreement shall terminate.
(iii) For purposes of this Section 13(j), it is the intention of the parties
that the differences between book value and fair market value and between
United States GAAP and International Accounting Standards shall not, in and of
themselves, give rise to increases or decreases in value of Crown or the
Company, as the case may be.
(iv) If Crown or Shareholder delivers notice that it disagrees with the
Shareholder Accountants Judgment or the Crown Accountants Judgment,
respectively, within the five day period specified above, Crown and Shareholder
shall mutually select an independent accounting firm of recognized
international standing to act as arbitrator (such firm, the "Independent
Accountant") and shall provide to the Independent Accountant all information
which the Independent Accountant may reasonably request and which is available
to Crown and Shareholder. The Independent Accountant shall, within 10 Business
Days thereof, advise Crown and Shareholder whether the Independent Accountant
agrees with the Shareholder Accountants Judgment or the Crown Accountants
Judgment, as the case may be. In expressing such judgment, the Independent
Accountant shall not consider any differences in the businesses of Crown, the
Company and their respective Subsidiaries resulting from public dissemination
of the termination notice or changes, whether actual or prospective, in general
conditions applicable to the industry in which Crown, the Company and their
respective Subsidiaries are involved or general economic conditions. If the
Independent Accountant agrees that the net adverse effect on the value of Crown
arising from the Additional Crown Information or on the value of the Company
arising from the Additional Company Information, after giving effect to any
increases in value that are attributable to positive aspects of the Additional
Crown Information or Additional Company Information, as the case may be,
exceeds $250 million, this Agreement shall terminate. If the Independent
Accountant does not agree that the net adverse effect on value of Crown arising
from the Additional Crown Information or on the value of the Company arising
from the Additional Company Information, after giving effect to any increases
in value that are attributable to positive aspects of the Additional Crown
Information or the Additional Company Information, as the case may be, exceeds
$250 million, the termination right of Crown or Shareholder, as the case may
be, pursuant to this paragraph (j) shall expire. The expiration of the
termination right provided by this paragraph (j) shall be without prejudice to
any other right of termination provided to any party pursuant to this Section
13.
(v) The fees and expenses of the Independent Accountant shall be borne
one-half by Crown and one-half by Shareholder.
(vi) In acting under this Agreement, the Independent Accountant shall be
entitled to the privileges and immunities of arbitrators.
(k) By Shareholder if the Board of Directors of Crown shall withdraw, or
adversely modify or adversely change its recommendation as contemplated by the
last sentence of Section 8(a) hereof and, thereafter, the Crown Shareholder
Approvals are not obtained at the Crown Shareholder Meeting provided that this
Agreement is not terminable at such time by Crown for a reason other than the
failure to obtain such Crown Shareholder Approvals.
(l) Effect of Termination. In the event of termination of this Agreement as
provided in this Section 13, this Agreement shall forthwith become void and
there shall be no liability on the part of either party hereto except that
nothing herein shall relieve either party from liability for any willful breach
of this Agreement.
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14. Expenses.
(a) Each of Crown, on the one hand, and Shareholder and the Company, on the
other hand, shall bear and pay all costs and expenses incurred by it or them or
on its or their behalf in connection with the transactions contemplated
hereunder, including fees and expenses of its own financial or other
consultants, investment bankers, accountants and counsel, except as set forth
in Section 13(j)(v) hereof and except that, to the fullest extent permitted
under law, in the event the Offer is successful Crown or its designee shall
reimburse Shareholder for 80% of the total amount of the documented fees and
expenses of Shareholder's legal and financial advisers with respect to the
transactions contemplated by this Agreement, up to a maximum reimbursement
amount of $15 million.
(b) Each of the parties has represented and warranted that neither it nor any
of its officers, directors, employees, affiliates, or Subsidiaries has employed
any broker or finder or incurred any liability for any financial advisory fees,
investment bankers' fees, brokerage fees, commissions, or finders' fees in
connection with this Agreement or the transactions contemplated hereby, except
as expressly provided in such representations and warranties. In the event of a
claim by any broker or finder based upon his or its representing or being
retained by or allegedly representing or being retained by either Crown or
Shareholder, each party agrees to indemnify and hold the other party harmless
of and from any such claim.
(c)(i) Upon any termination by Shareholder under Section 13(k), Crown shall
pay Shareholder $10 million (in recognition of the expenses and effort devoted
to the proposed transaction), provided that Shareholder shall give notice of
such termination within ten business days following the date of the Crown
Shareholder Meeting.
(ii) In the event that, pursuant to Section 2(b) hereof, Shareholder tenders
any of its Shares to a Third Party Bid, Shareholder shall pay Crown $10 million
(in recognition of the expenses and effort devoted to the proposed
transaction).
(iii) Section 14(c)(i) and 14(c)(ii) above are subject to prior approval of
the COB. In the event that obtaining such COB approval requires modification to
one or both of such Sections, Crown and Shareholder may mutually agree to
modify the obligations set forth herein.
(iv) The dollar amount set forth in Section 14(c)(i) and 14(c)(ii) above
shall not be construed to be liquidated damages, and, in the event of a breach
of this Agreement by either party hereto, the other party shall be entitled to
such damages and remedies as are available under this Agreement and applicable
law.
15. Miscellaneous.
(a) Entire Agreement; Assignment; No Third-Party Beneficiaries. This
Agreement, together with the Shareholders Agreement, the Crown Confidentiality
Agreement, the Company Confidentiality Agreement and the Shareholder
Confidentiality Agreement, (i) constitutes the entire agreement among the
parties with respect to the subject matter hereof and supersedes all other
prior agreements and understandings, both written and oral, between the parties
with respect to the subject matter hereof, provided that on the Closing Date
each of the Crown Confidentiality Agreement, the Company Confidentiality
Agreement and the Shareholder Confidentiality Agreement shall be superseded by
the provisions of the Shareholders Agreement (except that the confidentiality
provisions of such agreements shall survive) and (ii) shall not be assigned by
operation of law or otherwise, provided that Crown may assign any of its rights
and obligations hereunder to any direct or indirect wholly-owned Subsidiary of
Crown that agrees in writing to assume such rights and obligations and to be
bound by this Agreement; provided that Crown shall remain jointly and severally
liable for the performance of all obligations so assigned. This Agreement shall
not confer upon any person other than the parties hereto any rights or remedies
hereunder.
(b) Amendments. This Agreement may not be modified, amended, altered or
supplemented, except upon the execution and delivery of a written agreement
executed by the parties hereto.
(c) Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of New York.
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(d) Specific Performance. Each of the parties hereto recognizes and
acknowledges that a breach by it of any covenants or agreements contained in
this Agreement will cause the other party to sustain damages for which it would
not have an adequate remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the aggrieved party
shall be entitled to the remedy of specific performance of such covenants and
agreements and injunctive and other equitable relief in addition to any other
remedy to which it may be entitled, at law or in equity.
(e) Counterparts. This Agreement may be executed in two or more counterparts,
each of which shall be deemed to be an original, with the same effect as if the
signatures thereto and hereto were upon the same instrument.
(f) Descriptive Headings. The descriptive headings used herein are inserted
for convenience of reference only and are not intended to be part of or to
affect the meaning or interpretation of this Agreement.
(g) Severability. Whenever possible, each provision or portion of any
provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law, but if any provision or portion of
any provision of this Agreement is held to be invalid, illegal or unenforceable
in any respect under any applicable law, rule or regulation in any
jurisdiction, such invalidity, illegality or unenforceability will not affect
any other provision or portion of any provision in such jurisdiction, and this
Agreement will be reformed, construed and enforced in such jurisdiction as if
such invalid, illegal or unenforceable provision or portion of any provision
shall have been replaced with a provision which shall, to the maximum extent
permissible under such applicable law, rule or regulation, give effect to the
intention of the parties as expressed in such invalid, illegal or unenforceable
provision.
(h) Notices. All notices, requests, claims, demands and other communications
hereunder shall be in writing and shall be deemed to have been duly given when
delivered in writing and shall be deemed to have been duly given when delivered
in person, by cable, telegram, facsimile transmission with confirmation of
receipt, or telex, or by registered or certified mail (postage prepaid, return
receipt requested) to the respective parties as follows:
if to Crown:
Crown Cork & Seal Company, Inc.
0000 Xxxxxx Xxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
Chairman, President and
Chief Executive Officer
Telecopy: (000) 000.0000
with a copy to:
Dechert Price & Xxxxxx
4000 Xxxx Atlantic Tower
0000 Xxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx and
Xxxxxxx X. Xxxxxx
Telecopy: (000) 000.0000
if to Shareholder:
CGIP
00, xxx Xxxxxxxx
00000 Xxxxx, Xxxxxx
Attention: Michel Renault
Telecopy: (011) 00.0.00.00.00.00
A-32
with a copy to:
Xxxxxxxx & Xxxxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx
Telecopy: (000) 000.0000
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above
(provided that notice of any change of address shall be effective only upon
receipt thereof).
(i) No Waiver. Any waiver by any party of a breach of any provision of this
Agreement shall not operate as or be construed to be a waiver of any other
breach of such provision or of any breach of any other provision of this
Agreement. The failure of a party to insist upon strict adherence to any term
of this Agreement on one or more occasions shall not be considered a waiver or
deprive that party of the right thereafter to insist upon strict adherence to
that term or any other term of this Agreement.
(j) Nonsurvival of Warranties. Except for Sections 5(j), 5(m), 6(a) and 6(b),
none of the representations and warranties contained in this Agreement shall
survive the Expiration Date. This paragraph shall not limit any covenant or
agreement of the parties which by its terms contemplates performance after the
Expiration Date. It being understood that the inclusion of the warranties of
Crown set forth in Sections 5(c), 5(d), 5(e), 5(f), 5(g) and 5(i) are for the
purpose of establishing the condition to Shareholder's obligation to tender set
forth in Section 11.1(a), Crown shall have no liability for any breach of such
warranties in the event that this Agreement is terminated due to the
non-occurrence of the Offer as a result of a failure to satisfy such condition,
provided that the foregoing shall not limit any liability of Crown for breach
of its other obligations hereunder (including its obligations under Section
9(d)).
(k) Consent to Jurisdiction and Service of Process. Any legal action or
proceeding with respect to this Agreement or any matters arising out of or in
connection with this Agreement (other than the Shareholders Agreement, which
shall be governed solely by the analogous provisions thereof), and any action
for enforcement of any judgment in respect thereof shall be brought exclusively
in the courts of the State of New York or of the United States of America for
the Southern District of New York, unless such court shall not have
jurisdiction in which case it shall be brought in the Supreme Court of the
State of New York sitting in New York County and, by execution and delivery of
this Agreement, Crown and Shareholder each irrevocably consent to service of
process out of any of the aforementioned courts in any such action or
proceeding by the mailing of copies thereof by registered or certified mail,
postage prepaid, or by recognized international express carrier or delivery
service, to Crown or Shareholder at their respective addresses referred to
herein. Crown and Shareholder each hereby irrevocably waives any objection
which it may now or hereafter have to the laying of venue of any of the
aforesaid actions or proceedings arising out of or in connection with this
Agreement (other than the Shareholders Agreement, which shall be governed
solely by the analogous provisions thereof) brought in the courts referred to
above and hereby further irrevocably waives and agrees, to the extent permitted
by applicable law, not to plead or claim in any such court that any such action
or proceeding brought in any such court has been brought in an inconvenient
forum. Nothing herein shall affect the right of any party hereto to serve
process in any other manner permitted by law.
16. Definitions. Unless otherwise specified all references to "days" shall be
deemed to be references to calendar days. For purposes of this Agreement, the
following terms shall have the following meanings:
(a) Additional Crown Information. "Additional Crown Information" shall mean
information affecting the consolidated shareholders' equity and contingencies
related to assets or contingent liabilities of Crown and its Subsidiaries
(whether or not required to be recorded or reserved against under United States
GAAP) of Crown and its Subsidiaries, measured in accordance with United States
GAAP, provided to Shareholder by or on behalf of Crown after the date of this
Agreement and which is not publicly available prior to the date of this
Agreement.
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(b) Additional Company Information. "Additional Company Information" shall
mean information affecting the consolidated shareholders' equity and
contingencies related to assets or contingent liabilities (whether or not
required to be recorded or reserved against under International Accounting
Standards) of the Company and its Subsidiaries, in each case measured in
accordance with International Accounting Standards, provided to Crown by or on
behalf of Shareholder or the Company after the date of this Agreement and which
is not publicly available prior to the date of this Agreement; provided,
however, that Additional Company Information shall not include Company
Disclosure Information.
(c) Affiliate. An "affiliate" of a person shall have the meaning set forth in
Rule 12b-2 of the Exchange Act as in effect on the date hereof and, in
addition, shall include "associates" (as defined in Rule 12b-2 of the Exchange
Act as in effect on the date hereof) of such person and its affiliates.
(d) BALO Announcement. "BALO Announcement" shall mean the announcement
regarding the Company published in the Bulletin des Annonces Legales
Obligatoires on April 12, 1995.
(e) Beneficial Owner. A person shall be deemed to "beneficially own," or to
have "beneficial ownership" of any securities in accordance with the term
"beneficial ownership" as defined in Rule 13d-3 under the Exchange Act as in
effect on the date hereof and, in addition, such terms shall include securities
which such person has the right to acquire (irrespective of whether such right
is exercisable immediately or only after the passage of time, including the
passage of time in excess of sixty (60) days) pursuant to any agreement,
arrangement or understanding or upon the exercise of conversion rights,
exchange rights, warrants or options, or otherwise.
(f) Business Day. "Business Day" shall mean any date on which banking
institutions in the City of New York are not authorized or obligated by law or
executive order to close.
(g) CBV. "CBV" shall mean the French Conseil des Bourses de Valeurs.
(h) Closing. "Closing" shall mean the closing of the Offer.
(i) Closing Date. "Closing Date" shall mean the date on which the Offer is
successfully consummated as evidenced in the avis de resultat issued by the
CBV.
(j) COB. "COB" shall mean the French Commission des Operations de Bourse.
(k) Commencement Date. "Commencement Date" shall mean the date on which the
SBF has released an opening notice (avis d'ouverture) relating to the Offer.
(l) Company Disclosure Information. "Company Disclosure Information" shall
mean the information contained in the following documents, copies of all of
which were delivered to Crown prior to the signature of the Agreement: (i) the
Company's annual reports for the fiscal years ended December 31, 1993 and
December 31, 1994 and (ii) the matters disclosed at the meeting on May 20, 1995
with Xxxxxxx Xxxxxx, Chief Financial Officer of the Company, Xxxx Xxxxxxxxxx,
Chief Financial Officer of Crown, Xxxxx Xxxxxx, partner of Price Waterhouse
LLP, independent accountants to Crown, and Xxxxxxxxx Xxxxxxxxxx, partner of
Xxxxxx Xxxxxxxx, independent accountants to the Company, as memorialized in the
Notes, dated May 22, 1995 provided to Crown prior to the execution of this
Agreement. In determining the extent to which particular issues were disclosed
as part of the Company Disclosure Information, consideration shall be given to
the degree of detail of the description of the issues (including the specific
amounts actually furnished) summarized therein and the extent to which Crown
was able to form a view with respect to such issues in discussions with
representatives of the Company and its accountants.
(m) Due Diligence Period. "Due Diligence Period" shall mean the period of 30
days commencing on June 12, 1995 or such later date as the parties shall agree.
(n) Exchange Act. "Exchange Act" shall mean the U.S. Securities Exchange Act
of 1934, as amended.
(o) Filing Date. "Filing Date" shall mean the date on which the CBV Filing is
filed with the CBV.
(p) London Stock Exchange. "London Stock Exchange" shall mean the
International Stock Exchange of Great Britain and the Republic of Ireland,
Limited.
A-34
(q) French Market Day. "French Market Day" shall mean a day on which the
Paris Stock Exchange is open for trading.
(r) Group. "Group" shall mean a group (as such term is used in Section
13(d)(3) of the Exchange Act as in effect on the date hereof).
(s) Market Closing Price. "Market Closing Price" shall mean, for shares of
Crown Common Stock, the closing price per share on the trading day in question
as reported by the NYSE for composite transactions.
(t) Material Adverse Effect. "Material Adverse Effect", when used in
connection with Shareholder, the Company, or Crown, means any significant and
substantial adverse effect on the business, operations, or financial condition,
or results of operations of Shareholder, the Company or Crown, as the case may
be, and its consolidated Subsidiaries, taken as a whole, or on the ability of
Shareholder or Crown, as the case may be, to perform its obligations hereunder
or to consummate the transactions contemplated hereby; provided, however, that
"Material Adverse Effect" does not include events caused by general changes in
the economy or in the industries served by Shareholder, the Company or Crown,
as the case may be.
(u) Noon Buying Rate. "Noon Buying Rate" shall mean the noon buying rate in
the City of New York for cable transfers payable in French francs (expressed in
French francs per U.S. $1.00) as announced by the Federal Reserve Bank of New
York for customs purposes.
(v) NYSE. "NYSE" shall mean the New York Stock Exchange, Inc.
(w) Outstanding Common Stock. "Outstanding Common Stock" shall mean all the
shares of Common Stock currently outstanding, together with all shares under
option from time to time on the date of this Agreement plus all shares to be
issued in the Faba transaction as described in the BALO Announcement and shares
issued pursuant to the New Options and the 1994 Options.
(x) Paris Stock Exchange. "Paris Stock Exchange" shall mean the Bourse de
Paris.
(y) Person. "Person" shall mean any individual, Group, corporation,
partnership, firm, government or agency or political subdivision thereof, or
other entity of whatever nature.
(z) SBF. "SBF" shall mean the French Societe des Bourses Francaises.
(aa) SEC. "SEC" shall mean the U.S. Securities and Exchange Commission.
(ab) Securities Act. "Securities Act" shall mean the U.S. Securities Act of
1933, as amended.
(ac) Subsidiaries. "Subsidiaries" shall mean all direct and indirect
subsidiaries as the context requires.
(ad) SLF. "SLF" shall mean the French Service de la Legislation Fiscale.
(ae) United States GAAP. "United States GAAP" shall mean United States
generally accepted accounting principles.
(af) Voting Power. "Voting Power" shall mean the voting power in the general
election of members of the Conseil de Surveillance, and shall be calculated for
options to acquire shares of Common Stock and for securities convertible into
(or exercisable or exchangeable for) shares of Common Stock by reference to the
votes attributable to the number of shares of Common Stock for which such
options are exercisable or into which or for which such other securities are
convertible, exercisable or exchangeable.
(ag) $. "$" and "dollars" shall mean U.S. dollars.
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In addition, the following terms have the definitions specified in the
Sections noted:
Term Section
----------------------------------------- ------------------
1994 Financial Statements................ Section 5(g)
1994 Options............................. Annex 5(c)
Agreement................................ Preamble
Average Crown Common Stock Price......... Section 1(b)
BALO Announcement........................ Section 16(d)
By-law Amendment......................... Section 5(h)
Camebo................................... Section C.
Cash Election Price...................... Section A.
CBV Filing............................... Section 8(e)
Common Stock............................. Section A.
Company.................................. Section A.
Company Confidentiality Agreement........ Section 7(f)
Company Employee Plans................... Annex 5(j)
Company Public Reports................... Section 7(j)
Crown.................................... Preamble
Crown Accountants........................ Section 13(j)(i)
Crown Accountants Analysis............... Section 13(j)(ii)
Crown Accountants Judgment............... Section 13(j)(ii)
Crown Common Stock....................... Section A.
Crown Confidentiality Agreement.......... Section 8(d)
Crown Employee Plans..................... Section 5(g)
Crown Preferred Stock.................... Section A.
Crown SEC Reports........................ Section 5(c)
Crown Shareholder Approvals.............. Section 10.1(d)
Crown Shareholder Meeting................ Section 8(a)
days..................................... Section 16
Downgrade................................ Section 11(i)
Exchange Offers.......................... Section B.
Exchange Ratio........................... Section A.
Expiration Date.......................... Section 4
Final Determination Date................. Section 13(h)
Final Termination Date................... Section 13(e)
Financial Statements..................... Annex 5(e)
French and U.K. Securities Authorities... Annex 5(d)
French Franc Crown Common Stock Price.... Section 1(b)
Group.................................... Section 16(r)
HSR Act.................................. Section 5(k)
Independent Accountant................... Section 13(j)(iv)
International Accounting Standards....... Annex 5(e)
Investment Grade......................... Section 11(i)
Measurement Date......................... Section 1(b)
Minimum Condition........................ Section 1(a)
New Articles............................. Section 5(h)
New Options.............................. Annex 5(c)
Note d'Information....................... Section 5(o)
Offer.................................... Section A.
Outstanding Options...................... Section 1(h)
Pledge................................... Section 6(a)
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Term Section
----------------------------------- -------------------
Proxy Statement.................... Section 8(f)
Registration Statement............. Section 8(f)
Regulation 14A..................... Section 8(f)
Returns............................ Section 5(i)
Shareholder........................ Preamble
Shareholder Accountants............ Section 13(j)(i)
Shareholder Accountants Analysis... Section 13(j)(i)
Shareholder Accountants Judgment... Section 13(j)(i)
Shareholder Designee............... Xxx. 0, Xxxxxxx 13
Shareholders Agreement............. Section 9(f)
Shares............................. Section C.
Strategic Committee................ Exh. 1, Section 13
Subsidiaries....................... Section 16(x)
Taxes.............................. Section 5(i)
Third Party Bid.................... Section 2(b)
U.K. Exchange Offer................ Section B.
U.K. Filing........................ Section 8(h)
Unit............................... Section A.
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IN WITNESS WHEREOF, Crown and Shareholder have caused this Agreement to be
duly executed as of the day and year first above written.
Crown Cork & Seal Company, Inc.
/s/ Xxxx X. Xxxxxxxxxx
By:
Xxxx X. Xxxxxxxxxx
Executive Vice President
and Chief Financial Officer
Compagnie Generale D'Industrie Et De
Participations
/s/ Xxxxxx-Xxxxxxx Xxxxxxxxx
By:
Xxxxxx-Xxxxxxx Xxxxxxxxx
Chairman and Chief
Executive Officer
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ANNEX 1
Annex 1 to the Exchange Offer Agreement contains the Proposed Resolution of
Crown's Board of Directors setting forth the terms of the Crown 4.5% Preferred
Stock, which is attached as part of Annex B to this Proxy Statement/Prospectus.
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ANNEX 2
Annex 2 to the Exchange Offer Agreement contains the Articles of Amendment to
Crown's Articles of Incorporation referred to as the Acquisition Articles
Amendment, which is attached as part of Annex B to this Proxy
Statement/Prospectus.
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ANNEX 3
AMENDMENTS TO BY-LAWS
The following Sections of Article II of the Corporation's By-laws are amended
to insert a new Section 13 as follows:
Section 13: Strategic Committee; Numbers; Qualifications. The Board of
Directors shall by resolution appoint a committee (the "Strategic Committee")
consisting of a number of directors, one-half of whom are designated (each a
"Shareholder Designee") by Compagnie Generale d'Industrie et de Participations
("CGIP") pursuant to a Shareholders Agreement dated , 199 between the
Corporation and CGIP (the "Shareholders Agreement"). The Strategic Committee
shall initially consist of six members, three of whom shall be Shareholder
Designees.
Section 13.1: Powers. The Strategic Committee shall consider all issues
regarding: (i) changes in the dividend and debt rating policies of the
Corporation as such policies are set forth in Sections 3.7 and 3.8 of the
Shareholders Agreement; (ii) the approval of any merger, consolidation or
similar transaction of the Corporation or any material subsidiary of the
Corporation (other than pursuant to internal reorganizations); (iii) any
recapitalization or any share exchange involving the Corporation; (iv) the sale
by the Corporation or any subsidiary of the Corporation of a material amount of
assets; (v) the issuance of Common Stock or other securities or the incurrence
of indebtedness in any transaction in which a vote of the Corporation's
shareholders is required under New York Stock Exchange Rules or Pennsylvania
law or which involves a material amount of securities or indebtedness; (vi) an
acquisition by the Corporation of a material amount of assets; and (vii)
succession planning. Unless the Strategic Committee decides not to consider any
such issues, no such issue may be voted on by the Board of Directors until the
Strategic Committee has voted to recommend passage or rejection by the Board of
Directors or the Strategic Committee deadlocks on such issue and can make no
recommendation to the Board of Directors; and provided that if a meeting of the
Strategic Committee is not held to consider any such issue within seven days of
notice being given pursuant to Section 13.2, the Board of Directors shall be
free to vote on any such issue without having received the vote of the
Strategic Committee. The Board of Directors shall consider the vote of the
Strategic Committee in determining whether to pass or reject any such item but
shall not be bound to follow the vote of the Strategic Committee. The validity,
authorization or enforceability of any contract, agreement or instrument
entered into by the Corporation or any of its subsidiaries shall not be
affected by the operation of this Section 13.
The Board of Directors shall call a meeting of the Strategic Committee to
review the Corporation's response to any third party action or proposal
described in Section 2.1 of the Shareholders Agreement, if such section is then
currently in effect. The Strategic Committee shall consider and evaluate the
appropriate response to such proposal and make a recommendation to the full
Board of Directors.
Section 13.1: Chairman of Strategic Committee. A chairman of the Strategic
Committee shall be appointed from among the Shareholder Designees who serve on
such committee. The Chairman of the Strategic Committee shall preside at all
meetings of the Strategic Committee at which he or she shall be present and
shall have and may exercise such powers as may, from time to time, be assigned
to him or her by the Board of Directors or as may be provided by law.
Section 13.2: Meetings. Meetings of the Strategic Committee may be held at any
time, in Philadelphia or Paris or any other place within or without the State
of Pennsylvania as the Chairman of the Board of Directors and Chairman of the
Strategic Committee shall mutually agree from time to time, whenever called by
the Chairman of the Strategic Committee, or by any two members serving on the
Strategic Committee. Reasonable notice thereof shall be given by the person or
persons calling the meeting.
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Section 13.3: Participation in Meetings by Conference Telephone Permitted.
Members of the Strategic Committee may participate in a meeting of such
committee by means of conference telephone or similar communications equipment
by means of which all persons participating in the meeting can hear each other,
and participation in a meeting pursuant to this By-law shall constitute
presence in person at such meeting.
Section 13.4: Quorum; Vote Required for Action. At all meetings of the
Strategic Committee a majority of the entire Strategic Committee shall
constitute a quorum for the transaction of business. The vote of a majority of
the members of the Strategic Committee present at a meeting at which a quorum
is present and at which at least one half of the members present are
Shareholder Designees shall be the act of the Strategic Committee. In case at
any meeting of the Strategic Committee a quorum shall not be present, the
members of the Strategic Committee present may adjourn the meeting from time to
time until a quorum shall attend.
Section 13.5: Organization. Meetings of the Strategic Committee shall be
presided over by the Chairman of the Strategic Committee or in the absence of
the Chairman by a chairman chosen from among the other Shareholder Designees at
the meeting. The Secretary of the meeting shall be a liaison officer of CGIP
who shall be subject to the appropriate confidentiality provisions. If no such
officer is available to attend a meeting, the Strategic Committee Chairman or
any acting chairman of the meeting may appoint any person to act as secretary
of such meeting.
Section 13.6: Action by Strategic Committee Without a Meeting. Unless otherwise
restricted by the Articles of Incorporation or these Bylaws, any action
required or permitted to be taken at any meeting of the Strategic Committee may
be taken without a meeting if all members of the Strategic Committee consent
thereto in writing, and the writing or writings are filed with the minutes of
proceedings of the Strategic Committee.
Article IX of the Corporation's By-Laws shall be amended and restated in its
entirety as set forth below:
ARTICLE IX
Amendments
Section 1: Except as otherwise provided by law, these By-Laws may be amended
at any meeting of the Board of Directors at which a quorum is present by a
majority vote of the Directors present (and which majority vote shall, in
respect of an amendment to Section 13 of Article II or to this parenthetical,
include the majority vote of the Shareholder Designees then in office), or they
may be amended by a majority vote at any meeting of shareholders entitled to
vote thereon, provided, in either case, notice of the proposed amendment was
included in the notice of the meeting.
A-4-1
ANNEX 4
This Shareholders Agreement (the "Agreement"), dated as of
February 22, 1996, is between Crown Cork & Seal Company, Inc. a
corporation organized under the laws of the Commonwealth of Pennsylvania
(the "Company"), and Compagnie Generale d'Industrie et de Participations, a
societe anonyme organized under the laws of the Republic of France
("Shareholder").
WHEREAS, simultaneously with the execution of this Agreement,
Shareholder is acquiring beneficial ownership of 7,110,300 shares of the
Company's 4.5% Convertible Preferred Stock, par value $41.8875 per share
(the "Preferred Shares"), and 21,330,903 shares of the Company's common
stock, par value $5.00 per share (the "Common Stock"), pursuant to an
Exchange Offer Agreement, dated as of May 22, 1995, as amended, (the
"Exchange Offer Agreement"), between the Company and Shareholder;
WHEREAS, Shareholder recognizes the significant contributions
of the current management of the Company in creating shareholder value;
WHEREAS, in recognition of Shareholder's significant share
ownership in the Company, the Company has determined to grant to
Shareholder the right to designate three persons for election to the Board
of Directors of the Company;
WHEREAS, the Company has determined to form a new Strategic
Committee of the Board of Directors, which will be chaired initially by the
chairman and chief executive officer of Shareholder;
WHEREAS, in view of the foregoing and the parties' intention
that Shareholder shall influence, but not control, the business and affairs
of the Company, Shareholder has agreed to certain restrictions on the
acquisition and disposition of the Preferred Shares and the Common Stock
and the conduct of Shareholder with respect to the Company.
NOW, THEREFORE, in consideration of the mutual covenants and
agreements contained herein and in the Exchange Offer Agreement and
intending to be legally bound hereby, the parties hereto agree as follows:
A-4-2
ARTICLE 1
Definitions; Representations and Warranties
SECTION 1.1 Definitions. Except as otherwise specified herein,
defined terms used in this Agreement shall have the respective meanings
assigned to such terms in the Exchange Offer Agreement. Unless otherwise
specified all references to "days" shall be deemed to be references to
calendar days. For purposes of this Agreement, the following terms shall
have the following meanings:
(a) Affiliate. An "Affiliate" of a Person shall have the
meaning set forth in Rule 12b-2 of the Exchange Act as in effect on the
date hereof.
(b) Bankruptcy Event. A "Bankruptcy Event" shall mean (i)
the entry by a court having jurisdiction in the premises of (x) a decree or
order for relief in respect of the Company in an involuntary case or
proceeding under any applicable United States or state bankruptcy,
insolvency, reorganization or other similar law or (y) a decree or order
adjudging the Company a bankrupt or insolvent, or approving as properly
filed a petition seeking reorganization, arrangement, adjustment or
composition of or in respect of the Company under any applicable United
States or state law or appointing a custodian, receiver, liquidator,
assignee, trustee, sequestrator or other similar official of the Company or
of any of the Company's property, or ordering the winding-up or liquidation
of the Company's affairs; and the continuance of any such decree or order
of relief or any such other decree or order unstayed and in effect for a
period of ninety (90) consecutive days; or (ii) the commencement by the
Company of a voluntary case or proceeding under any applicable United
States or state bankruptcy, insolvency, reorganization or other similar law
or any case or proceeding to be adjudicated a bankrupt or insolvent, or the
consent by the Company to the entry of a decree or order for relief in
respect of the Company in an involuntary case or proceeding under any
applicable United States or state bankruptcy, insolvency, reorganization or
other similar law or to the commencement of any bankruptcy or insolvency
case or proceeding against the Company or the filing by the Company of a
petition or answer or consent seeking reorganization or relief under any
applicable United States or state law, or the consent by the Company to the
filing of such a petition or to the appointment of or taking possession by
a custodian, receiver, liquidator, assignee, trustee, sequestrator or other
similar official of the Company or of any substantial part of the Company's
property, the making by the Company of a general assignment for the benefit
of creditors or the admission by the Company of the Company's inability to
pay its debts generally as they become due, or the
A-4-3
taking of corporate action by the Company with the intent of causing any of
the foregoing.
(c) Beneficial Owner. A Person shall be deemed to
"beneficially own," or to have "beneficial ownership" of, any Voting
Securities in accordance with the term "beneficial ownership" as defined in
Rule 13d-3 under the Exchange Act as in effect on the date hereof and, in
addition, such terms shall include securities which such Person has the
right to acquire (irrespective of whether such right is exercisable
immediately or only after the passage of time, including the passage of
time in excess of sixty (60) days) pursuant to any agreement, arrangement
or understanding or upon the exercise of conversion rights, exchange
rights, warrants or options, or otherwise. For purposes of this Agreement,
Shareholder shall be deemed to beneficially own any Voting Securities
beneficially owned by its Controlled Affiliates or any Group of which
Shareholder or any such Controlled Affiliate is a member.
(d) Board of Directors. "Board of Directors" shall mean
the Board of Directors of the Company.
(e) Closing Date. "Closing Date" shall mean the date of
the consummation of the OPE.
(f) Company Stock. "Company Stock" shall mean the
Preferred Shares and the Common Stock.
(g) Commission. "Commission" shall mean the Securities
and Exchange Commission.
(h) Controlled Affiliate. "Controlled Affiliate" shall
mean, with respect to any Person, any other Person more than fifty percent
(50%) of the outstanding voting securities of which is beneficially owned,
and any other Person which is actually controlled, directly or indirectly,
by such Person or one or more of its Controlled Affiliates. For purposes of
this Agreement, each of MW and Xxxxxx-Xxxxxxx Xxxxxxxxx shall be deemed to
be Controlled Affiliates of Shareholder.
(i) Exchange Act. "Exchange Act" shall mean the
Securities Exchange Act of 1934, as amended.
(j) Group. "Group" shall mean a "group" as such term is
used in Section 13(d)(3) of the Exchange Act as in effect on the date
hereof.
(k) MW. "MW" shall mean Marine-Xxxxxx, a societe
anonyme organized under the laws of the Republic of France.
A-4-4
(l) NYSE. "NYSE" shall mean the New York Stock
Exchange, Inc.
(m) OPE. "OPE" shall mean the offre publique d'echange
undertaken by the Company as provided in the Exchange Offer Agreement.
(n) Person. "Person" shall mean any individual, Group,
corporation, general or limited partnership, limited liability company,
governmental entity, joint venture, estate, trust, association,
organization or other entity of any kind or nature.
(o) Securities Act. "Securities Act" shall mean the
Securities Act of 1933, as amended.
(p) Shareholder Designee. "Shareholder Designee" shall
mean a person designated for election to the Board of Directors by
Shareholder as provided in Section 3.2.
(q) Strategic Committee. "Strategic Committee" shall
mean the Strategic Committee of the Board of Directors to be formed as
provided in the Exchange Offer Agreement.
(r) Specified Event. "Specified Event" shall mean any
unsolicited tender or exchange offer commenced by a Person (other than
Shareholder or its Controlled Affiliates or any Group of which Shareholder
or any such Controlled Affiliate is a member) for Voting Securities
representing more of the Total Voting Power of the Company than the amount
beneficially owned by Shareholder (but in any event for Voting Securities
representing not less than twenty percent (20%) of the Total Voting Power
of the Company), or an unsolicited proxy or consent solicitation by any
such Person in order to replace at least a majority of the Continuing
Directors, or any unsolicited tender or exchange offer for voting
securities representing at least twenty percent (20%) of the Total Voting
power of any material subsidiary of the Company.
(s) Takeover Proposal. "Takeover Proposal" shall mean
(i) any Specified Event, (ii) any other proposal to take-over control of
the Company or a merger, share exchange, other business combination,
recapitalization, restructuring, liquidation or similar transaction
involving the Company or any of its material subsidiaries, or any proposal
or offer to acquire in any manner Voting Securities representing more than
twenty percent (20%) of the Total Voting Power of the Company or any of its
material subsidiaries, a substantial equity interest in any of the
Company's material subsidiaries or a substantial portion of the assets of
the Company or any of its material subsidiaries, (iii) any request to
invite any Person to effect any of the actions specified in Section
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3.1 or any request to challenge the validity of, waive the benefit of, opt
out of, or amend any provision of, the shareholder rights plan of the
Company described in Section 3.6 or any rights plan approved by the
Strategic Committee or any anti-takeover statutes or other anti-takeover
provisions applicable to the Company, or (iv) a proposal having similar
effect.
(t) Total Voting Power. The term "Total Voting Power"
shall mean the total combined Voting Power, on a fully diluted basis, of
all the Voting Securities then outstanding.
(u) Voting Power. The term "Voting Power" shall mean
the voting power in the general election of directors of the Company, and
shall be calculated for each Voting Security by reference to the maximum
number of votes such Voting Security is or would be entitled to cast in the
general election of directors, and, in the case of convertible (or
exercisable or exchangeable) securities, by reference to the maximum number
of votes such Voting Security is entitled to cast in unconverted or
converted (or exercised, unexercised, exchanged or unexchanged) status. For
purposes of determining Voting Power under this Agreement, a Voting
Security which is convertible into or exchangeable for a Voting Security
shall be counted as having the greater of (i) the number of votes to which
such Voting Security is entitled prior to conversion or exchange and (ii)
the number of votes to which the Voting Security into which such Voting
Security is convertible or exchangeable is entitled. Notwithstanding
anything else to the contrary contained herein, there shall not be included
in calculating Voting Power any votes which a Person shall have upon the
non-payment of dividends on the Preferred Shares in accordance with the
terms of the Preferred Shares.
(v) Voting Securities. "Voting Securities" shall mean,
without duplication, (x) any securities entitled, or which may be entitled,
to vote generally in the election of directors of the Company, (y) any
securities convertible or exercisable into or exchangeable for such
securities (whether or not the right to convert, exercise or exchange is
subject to the passage of time or contingencies or both) (including the
Preferred Shares), or (z) any direct or indirect rights or options to
acquire any such securities; provided that unexercised options granted
pursuant to any employment benefit or similar plan and rights issued
pursuant to any shareholder rights plan (including that described in
Section 3.6) shall be deemed not to be "Voting Securities" (or to have
Voting Power).
In addition, the following terms have the definitions specified
in the Sections noted:
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Term Section
Acquire 3.1(a)
Agreement recitals
Beneficial Ownership Thresholds 3.2(a)
Cap 4.5(a)
Common Stock recitals
Company recitals
Continuing Director 4.1(f)
Designated Company Breach 2.1(v)
Designated Shareholder Breach 2.1
Disposition 4.1
Exchange Offer Agreement recitals
Exercise Notice 4.2(a)
Losses 5.5
Market Price 4.2(b)(i)
Moving Party 7.4
NASD 4.2(b)(i)
Preferred Shares recitals
Preliminary Transfer Notice 4.2(a)
Private Sale 4.1(d)
Purchase Price 4.2(b)
Purchasing Person 4.1(b)
Required Disposition 4.5(a)
Rule 144 Sale 4.1(c)
Section 4.2 Closing 4.2(a)
Shareholder recitals
Standstill Period 2.1
Subject Stock 5.1
Third Party Offeror 4.1(f)
Transfer Notice 4.2(a)
Underwritten Offering 4.1(b)
SECTION 1.2 Representations and Warranties of the Company. The
Company represents and warrants to Shareholder as follows:
(a) The execution, delivery and performance by the
Company of this Agreement and the consummation by the Company of the
transactions contemplated by this Agreement are within its corporate powers
and have been duly authorized by all necessary corporate action on its
part. This Agreement constitutes a legal, valid and binding agreement of
the Company enforceable against the Company in accordance with its terms,
subject, as to enforcement, to bankruptcy, and insolvency, fraudulent
transfer reorganization, moratorium and similar laws of general
applicability relating to or affecting creditor's rights and to general
equity principles (it being understood that such exception shall not in
itself be construed to mean that the Agreement is not enforceable in
accordance with its terms).
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(b) The execution, delivery and performance of this
Agreement by the Company does not and will not contravene or conflict with
or constitute a default under the Company's Articles of Incorporation or
Bylaws.
SECTION 1.3 Representations and Warranties of Shareholder.
Shareholder represents and warrants to the Company as follows:
(a) The execution, delivery and performance by
Shareholder of this Agreement and the consummation by Shareholder of the
transactions contemplated by this Agreement are within its corporate powers
and have been duly authorized by all necessary corporate action on its
part. This Agreement constitutes a legal, valid and binding agreement of
Shareholder enforceable against Shareholder in accordance with its terms,
subject, as to enforcement, to bankruptcy, and insolvency, fraudulent
transfer reorganization, moratorium and similar laws of general
applicability relating to or affecting creditor's rights and to general
equity principles (it being understood that such exception shall not in
itself be construed to mean that the Agreement is not enforceable in
accordance with its terms).
(b) The execution, delivery and performance of this
Agreement by Shareholder does not and will not contravene or conflict with
or constitute a default under Shareholder's statuts or similar governing
documents.
(c) As of the date hereof, Shareholder beneficially
owns 7,100,300 Preferred Shares and 21,330,903 shares of Common Stock and
Shareholder does not beneficially own any other Voting Securities.
ARTICLE 2
Standstill Period
SECTION 2.1 Standstill Period. The "Standstill Period" shall
be the period commencing on the date hereof and ending on the earliest of:
(i) the date that is the later of (i) three (3) years after
the date hereof and (ii) the date on which Shareholder beneficially
owns Voting Securities (whether now owned or hereafter acquired)
having Voting Power representing, in the aggregate, less than three
and one-half percent (3.5%) of the Total Voting Power of the Company;
(ii) the date the Board of Directors agrees to recommend (or
ceases to oppose) the consummation of a Specified Event,
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or takes any action designed to induce or materially facilitate such
Specified Event, such as redeeming any rights issued under a
shareholder rights plan outstanding on the date a third party
initiates a Specified Event (provided that the sharing of
confidential information with, or discussing the possible sale of the
Company to, or the merger or consolidation with, a potential "white
knight" shall not constitute taking action designed to induce or
materially facilitate a Specified Event or result in a termination of
the Standstill Period, but provided further, that in order to permit
Shareholder to have a reasonable period of time to pursue other
opportunities before such sale, merger or consolidation, if the Board
of Directors resolves to proceed with such sale, merger or
consolidation opposed by a majority of the Shareholder Designees,
then such Standstill Period may be terminated by Shareholder);
(iii) the date that Voting Securities representing twenty five
percent (25%) of the Total Voting Power of the Company have been
acquired by any Person or Group other than Shareholder, its
Controlled Affiliates or any Group of which Shareholder or any such
Controlled Affiliate is a member;
(iv) the date that the Company has entered into an agreement
with respect to the merger or consolidation of the Company or the
sale of all or substantially all of the assets of the Company, or any
tender or exchange offer for Voting Securities representing twenty-
five percent (25%) or more of the Total Voting Power of the Company,
after which the surviving company in any such transaction would have
a board of directors of which the majority of its members would not
be Continuing Directors (and, in addition, in respect of an asset
sale, in which the shareholders of the Company do not receive capital
stock of the successor company), or the Company takes material steps
to solicit any such transaction;
(v) the date that the Company materially breaches the
provisions of Sections 3.2 or 5.1 hereof, and such breach remains
uncured for fifteen (15) days, in the case of breaches of Section
3.2, and thirty (30) days, in the case of breaches of Section 5.1
after written notice of such breach has been given by Shareholder to
the Company (a "Designated Company Breach");
(vi) the date that any Shareholder Designee fails to be
elected in any election to the Board of Directors, unless the Company
shall not have taken appropriate action within thirty (30) days
thereafter to cause another Shareholder Designee to become a member
of the Board of Directors, or to otherwise adjust the size of the
Board of Directors to preserve the
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proportionate representation on the Board of Directors to which Shareholder
is then entitled as specified in Section 3.2;
(vii) the date that the Company breaches the dividend payment
requirement of Section 3.7(a) hereof (if such payment is not excused
by the provisions of Section 3.7(b) hereof), unless the Company shall
have elected to its Board of Directors one (1) Shareholder Designee
in excess of the number of such Shareholder Designees provided for in
Section 3.2(a) hereof, in which case the Company shall have an
additional period of one (1) year to cure such dividend payment
breach (it being understood that Shareholder shall cause such
Shareholder Designee to resign from the Board of Directors promptly
after the earlier of (x) the date of such cure and (y) the date of
termination of the Standstill Period); or
(viii) the date that the Company breaches the debt rating
maintenance provisions of Section 3.8 hereof.
Notwithstanding the foregoing, the Standstill Period shall not
terminate if, at the time the Standstill Period would otherwise have
terminated in accordance with clause (i) through (viii) above, Shareholder
is in material breach of the provisions of Sections 3.1, 3.2, 3.3 or 4.1 of
this Agreement (a "Designated Shareholder Breach").
ARTICLE 3
Standstill and Voting Provisions
SECTION 3.1 Restrictions of Certain Actions by
Shareholder. During the Standstill Period, Shareholder agrees that none of
Shareholder, any of its Controlled Affiliates, or any Group of which
Shareholder or any such Controlled Affiliate is a member, will in any
manner, directly or indirectly, effect or seek, initiate or propose
(whether publicly or otherwise) to effect, or cause or participate in, or
in any way induce, assist or encourage any other Person to effect, seek,
offer, initiate or propose (whether publicly or otherwise) to effect or
participate in, any Takeover Proposal, or including without limitation any
action described in (a) through (c) below, unless in any such case invited
in writing to do so by the Board of Directors as specifically expressed in
a resolution adopted by a majority of the Continuing Directors who are not
Shareholder Designees:
(a) acquire, offer or propose to acquire, or agree to
acquire, whether by purchase, tender or exchange offer, gift or otherwise
(any such act, to "acquire"), beneficial ownership of any Voting Securities
or any rights to acquire (whether currently, upon
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lapse of time, following the satisfaction of any conditions, upon the
occurrence of any event or any combination of the foregoing) any Voting
Securities except for (x) the acquisition of Voting Securities (provided
that there is not a Designated Shareholder Breach in existence at the time
of such acquisition) which would not, after giving effect to such
acquisition, result in beneficial ownership of Voting Securities
representing Voting Power in excess of 19.95% of the Total Voting Power of
the Company, (y) pursuant to a stock split, stock dividend, rights
offering, recapitalization, reclassification or similar transaction made
available to holders of any Voting Securities generally or (z) upon
conversion of the Preferred Shares in accordance with their terms;
provided, that any such Voting Securities shall be subject to the
restrictions of this Agreement (it being understood that if Shareholder
beneficially owns or acquires any Voting Securities in violation of this
Agreement, such Voting Securities shall immediately be disposed of to
Persons who are not Affiliates thereof but only in compliance with the
provisions of this Agreement; provided however, that the Company may also
pursue any other available remedy to which it may be entitled as a result
of such violation); provided further that the provisions of this Section
3.1(a) shall not prohibit any Shareholder Designee from acquiring Voting
Securities pursuant to any Company restricted stock plan, option plan or
similar plan available to directors of the Company,
(b) form, join, participate in or encourage the
formation of, any Group with respect to any Voting Securities or deposit
any Voting Securities into a voting trust or subject any such Voting
Securities to a voting agreement or any other arrangement or agreement with
respect to the voting thereof; provided however that, subject to Section
4.1 hereof, Shareholder may enter into one or more bona fide pledges of
Voting Securities with major brokerage firms and financial institutions; or
(c) request the Company (or its directors, officers,
employees or agents) to amend or waive any provision of this Agreement
(including this paragraph);
Notwithstanding the foregoing, Shareholder's ability to vote its
shares shall be governed exclusively by the provisions of Section 3.3
hereof and the provisions of this Agreement shall not restrict the
Shareholder Designees from acting in their capacity as directors of the
Company.
SECTION 3.2 Board Representations. (a) The Company will
cause Xxxxxx-Xxxxxxx Xxxxxxxxx, Xxx xx Xxxxxxx and Xxxxx X. Xxxxxxx or,
subject to Section 3.2(e), such other substitute persons as may be
designated by Shareholder, to be elected to the Board of Directors on the
Closing Date. Thereafter, during the Standstill Period and subject to the
further provisions hereof, the
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Company agrees to support the nomination of, and the Company's nominating
committee (or any other committee exercising a similar function) shall
recommend to the Board of Directors that (i) one Shareholder Designee, so
long as Shareholder beneficially owns Voting Securities having Voting Power
equal to or greater than five percent (5%) of the Total Voting Power and
less than ten percent (10%) of the Total Voting Power, (ii) two Shareholder
Designees, so long as Shareholder beneficially owns Voting Securities
having Voting Power equal to or greater than ten percent (10%) of the Total
Voting Power and less than fifteen percent (15%) of the Total Voting Power,
and (iii) three Shareholder Designees, so long as Shareholder beneficially
owns Voting Securities having Voting Power equal to or greater than fifteen
percent (15%) of the Total Voting Power (collectively the "Beneficial
Ownership Thresholds"), be included in the slate of nominees recommended by
the Board of Directors to shareholders for election as directors at each
annual meeting of shareholders of the Company commencing with the next
annual meeting of shareholders. In the event that any of such designees
shall cease to serve as a director for any reason, the Board of Directors
shall fill the vacancy resulting thereby, subject to the terms of this
Agreement, with a person designated by Shareholder (and such person shall
be a "Shareholder Designee" for purposes hereof). Notwithstanding the
foregoing, the Company shall not have any obligation to support the
nomination, recommendation or election of any Shareholder Designee pursuant
to this Section 3.2(a) to the extent any of the Beneficial Ownership
Thresholds is met or exceeded by Shareholder as a result of its acquisition
of beneficial ownership of Voting Securities after the date hereof (except
for such acquisitions to the extent necessary to maintain Shareholder's
beneficial ownership of Voting Securities solely to the extent such
ownership has decreased as a result of the primary issuance of Voting
Securities by the Company or sale by the Company of Voting Securities held
in treasury prior to any such acquisition of Voting Securities by
Shareholder).
(b) During such time as Shareholder is entitled
pursuant to Section 3.2(a) above to have at least one Shareholder Designee
on the Board of Directors, Shareholder shall also be entitled to have one
Shareholder Designee appointed to serve on each committee of the Board of
Directors, including any special committee, and the Company agrees to cause
one such Shareholder Designee to be so appointed. Notwithstanding the
foregoing, if none of the Shareholder Designees would be considered
"independent" of the Company or "disinterested" (i) for purposes of any
applicable rule of the NYSE, the Paris Stock Exchange, the London Stock
Exchange or any other securities exchange or other self regulating
organization (such as the NASD) requiring that members of the Audit
Committee be independent of the Company, (ii) for purposes of any law or
regulation that requires, in order to obtain or maintain favorable tax,
securities, corporate law or other material legal
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benefits with respect to any plan or arrangement for employee compensation
or benefits, that the members of the committee of the Board of Directors
charged with responsibility for such plan or arrangement be "independent"
of the Company or "disinterested", or (iii) for purposes of any special
committee formed in connection with any transaction or potential
transaction involving the Company and any of Shareholder, its Controlled
Affiliates or any Group of which Shareholder is a member or such other
transaction or potential transaction which would involve a conflict of
interest on the part of the Shareholder Designees, then a Shareholder
Designee shall not be required to be appointed to any such committee;
provided that, the committees of the Board shall be organized such that, to
the extent practicable, the only items to be considered by any committee on
which no Shareholder Designee may serve will be those items which prevent
the Shareholder Designee from serving on such committee.
(c) Upon expiration of the Standstill Period pursuant
to Section 2.1(i) hereof or in the event of a Designated Shareholder
Breach, Shareholder shall have no further rights under this Section 3.2 and
shall cause its designees on the Board of Directors to resign promptly from
the Board of Directors and any committees thereof. In addition, if at any
time Shareholder beneficially owns Voting Securities in an amount not
sufficient to entitle Shareholder to designate the number of Shareholder
Designees then currently serving on the Board of Directors pursuant to
Section 3.2(a), then Shareholder shall cause to resign promptly from the
Board of Directors that number of Shareholder Designees as shall exceed the
number of directors that Shareholder would then be entitled to designate
pursuant to Section 3.2(a); provided, however, that to the extent
Shareholder's beneficial ownership of Voting Securities has decreased as a
result of the primary issuance of Voting Securities by the Company or sale
by the Company of Voting Securities held in treasury, Shareholder shall not
be required to cause any Shareholder Designee to resign for a period of
eighteen (18) months after the date of the primary issuance or sale of
Voting Securities which triggered the resignation requirement set forth in
this sentence and, in the event that at the end of such eighteen (18) month
period Shareholder then beneficially owns sufficient Voting Securities to
entitle Shareholder to designate a number of Shareholder Designees then
sitting on the Board of Directors, Shareholder shall cause only the
Shareholder Designees in excess of that number to resign from the Board of
Directors.
(d) As of the Closing Date, the Board of Directors
shall consist of no more than eighteen (18) directors and shall be reduced
to sixteen (16) directors by no later than immediately after the time of
the Company's next annual meeting of Shareholders. In the event that the
size of the Board of Directors
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is thereafter increased or decreased, the number of directors Shareholder
shall be entitled to designate shall be adjusted ratably. In the event the
increase in the number of directors was approved by a majority of the
Shareholder Designees serving on the Board of Directors, any fraction shall
be rounded down to the nearest whole number. In the event the increase in
the number of directors was not approved by a majority of such Shareholder
Designees, any fraction shall be rounded up to the nearest whole number.
When required by this paragraph, Shareholder shall promptly cause the
appropriate number of Shareholder Designees to resign from the Board of
Directors and any committees thereof, or the Company shall promptly cause
to be elected the appropriate number of Shareholder Designees to give
effect to this paragraph, as the case may be.
(e) Notwithstanding the provisions of this Section 3.2,
Shareholder shall not be entitled to designate any person to the Company's
Board of Directors (or any committee thereof) in the event that the Company
receives a written opinion of its outside counsel that a Shareholder
Designee would not be qualified under any applicable law, rule or
regulation to serve as a director of the Company or if the Company objects
to a Shareholder Designee because such Shareholder Designee has engaged in
any adverse conduct that would require disclosure under Item 7 of Schedule
14A (promulgated under the Exchange Act) or if the Board of Directors
determines in good faith in its reasonable judgment that nomination or
election of a Shareholder Designee would be a breach of the fiduciary
duties of the Board of Directors, and, in any such event, the Shareholder
shall withdraw the designation of such proposed Shareholder Designee and
designate a replacement therefor (which replacement Shareholder Designee
shall also be subject to the requirements of this Section). The Company
shall use its reasonable best efforts to notify the Shareholder of any
objection to a Shareholder Designee sufficiently in advance of the date on
which proxy materials are mailed by the Company in connection with such
election of directors to enable the Shareholder to propose a replacement
Shareholder Designee in accordance with the terms of this Agreement.
SECTION 3.3. Voting. (a) Shareholder agrees that, during the
Standstill Period, Shareholder shall, and shall cause its Controlled
Affiliates and any Person which is a member of any Group of which
Shareholder or any of its Controlled Affiliates is a member, to be present,
in person or represented by proxy, at all shareholder meetings of the
Company so that all Voting Securities beneficially owned by Shareholder
shall be counted for the purpose of determining the presence of a quorum at
such meetings. Shareholder shall be free to vote or cause to be voted such
Voting Securities in its discretion; provided that Shareholder shall vote
or cause to be voted, or consent with respect to, all Voting
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Securities beneficially owned by Shareholder in the manner recommended by
the Company's Board of Directors in connection with the following actions
to be taken by holders of Voting Securities:
(i) the election of directors of the Company; provided that
Shareholder shall not be obliged to vote in such manner for any
nominee for election as a director who is, pursuant to an arrangement
or agreement between the Company and a Person or Group (other than
Shareholder, its Controlled Affiliates or any Group of which the
Shareholder or any of its Controlled Affiliates is a member) holding
Voting Power equal to or in excess of the Voting Power of Shareholder
at the record date for voting in such election, designated as a
nominee by such Person or Group, and
(ii) any question, resolution or proposal relating to a
Takeover Proposal which is submitted to a vote of the shareholders of
the Company.
SECTION 3.4 Third Party Contacts. (a) If at any time
during the Standstill Period, Shareholder or any of its Controlled
Affiliates is approached by any party concerning (i) a Takeover Proposal
which Shareholder determines in its good faith judgment is so significant
as to be considered by the Board of Directors, or (ii) a proposal to
acquire all or a substantial portion of the Voting Securities beneficially
owned by Shareholder which Shareholder determines in its good faith
judgment is so significant as to be considered by its supervisory board or
directorate, Shareholder will promptly inform the Company of the Takeover
Proposal or other such proposal, as the case may be, and in the case of a
Takeover Proposal, the Strategic Committee shall consider and evaluate a
response to such Takeover Proposal and make a recommendation to the Board
of Directors.
(b) If at any time during the Standstill Period, the
Company is approached by any party concerning a Takeover Proposal which the
Chairman of the Board of the Company determines in his good faith judgment
is so significant as to be considered by the Board of Directors, the
Chairman of the Board of the Company will promptly inform the Chairman of
the Strategic Committee of the Takeover Proposal and the Committee shall
consider and evaluate a response to such Takeover Proposal and make a
recommendation to the Board of Directors.
SECTION 3.5 Notices of Dispositions of Voting Securities. Not
later than the tenth day following the end of any calendar month during the
Standstill Period in which one or more Dispositions of Voting Securities by
Shareholder or any of its Controlled Affiliates shall have occurred,
Shareholder shall use its reasonable best efforts to give written notice
to the Company
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of all such Dispositions (in the case of Dispositions by Controlled
Affiliates, to the extent it has knowledge) unless any such Disposition
has been reflected in a filing on Schedule 13D or Form 4 (or any successor
to such forms) under the Exchange Act or an amendment thereto that was
delivered to the Company on or in advance of the date upon which notice
thereof under this Section 3.5 would have been due. Such notice shall
state the date upon which each such Disposition was effected, the number
and type of Voting Securities involved in each such Disposition, the means
by which each such Disposition was effected and, to the extent known, the
identity of the Person acquiring Voting Securities.
SECTION 3.6 Shareholder Rights Plan. The Company has
adopted a shareholder's rights plan on terms and conditions set forth in
the Rights Agreement dated as of August 7, 1995 between the Company and
First Chicago Trust Company of New York as Rights Agent.
SECTION 3.7 Dividend Policy. (a) The Company has
indicated that it is the present intention of the Board of Directors to
commence regularly paying dividends on the Common Stock on a quarterly
basis, starting with the calendar quarter in which the Closing Date occurs
(and, with respect to dividends paid in the calendar quarter in which the
Closing occurs, such dividends shall be paid to holders of record of the
Common Stock as of a date after the Closing Date). With respect to
dividends paid in 1996, such dividends will be paid in an annualized amount
of $ 1.00 per share ($ 0.25 per quarter). All such dividend rates shall be
subject to adjustment for any stock splits, reverse stock splits, stock
dividends and similar events after the date of the Exchange Offer
Agreement. The Company has indicated that it is the present intention of
the Board of Directors to increase the amount of such dividends over time
based on the financial condition of the Company. The amount of dividends
paid to Shareholder during the four full quarters following the Latest
Mandatory Conversion Date (as defined in the terms of the Preferred Shares
included as Annex 1 to the Exchange Offer Agreement)shall not be less than
the amount of dividends paid to Shareholder on the Common Stock and
Preferred Shares that Shareholder receives in the OPE during the four full
fiscal quarters following the OPE (assuming for these purposes that
Shareholder has neither purchased nor disposed of any securities of the
Company after the OPE is consummated), and thereafter the Company shall
maintain the policy of paying dividends generally consistent with prior
policy, it being understood that if the provisions of this sentence are not
complied with, Shareholder shall be entitled solely to the remedies set
forth in Section 2.1 (vii) hereof.
(b) Any change in the dividend payments actually made or any
failure by the Company to maintain the policy of paying
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dividends from that set forth in the third sentence of Section 3.7(a)
hereof that is recommended to the Board of Directors by the Strategic
Committee shall be deemed to replace the dividend payment or policy
condition in such sentence of Section 3.7(a) hereof for all purposes under
this Agreement. The Company shall be excused from its failure to pay any
dividends in such dividend payment condition and to maintain such dividend
policy condition to the extent that the Company's cash needs in connection
with the conduct of its operations are such that the Board of Directors in
its good faith judgment determines that the payment of such dividends or
the maintenance of such policy would, under the circumstances, be
materially detrimental to the Company.
SECTION 3.8 Debt Rating. The Company intends to conduct its
business in a manner consistent with its maintaining an "investment grade"
rating for its long-term unsecured debt securities, and agrees that any
failure to maintain such rating with at least one "nationally recognized
statistical rating organization" (as defined for purposes of Rule 436(g)
under the Securities Act) for a period of longer than one year shall
constitute a breach of the foregoing requirement, provided such failure
does not result from changes in general economic or industry conditions or
other circumstances that could not have been reasonably avoided by the
management of the Company or from transactions, policies or activities
approved by the Strategic Committee (it being understood that if the
provisions of this sentence are not complied with, Shareholder shall be
entitled solely to the remedies set forth in Section 2.1 (viii) hereof).
ARTICLE 4
Transfer Restrictions
SECTION 4.1 Restrictions on Dispositions. During the
Standstill Period, Shareholder shall not, and shall cause its Controlled
Affiliates not to, directly or indirectly (including, without limitation,
through the disposition or transfer of control of another Person), sell,
assign, donate, transfer, pledge, hypothecate, grant any option with
respect to or otherwise dispose of any interest in (or enter into an
agreement or understanding with respect to the foregoing) any Voting
Securities (a "Disposition"), except as set forth below in this Section
4.1; provided, however, that the restrictions set forth in Sections 4.1
through 4.4 shall not apply to Shareholder if a Bankruptcy Event has
occurred during the Standstill Period. Without limiting the generality of
the foregoing, any sale of securities of Shareholder or any of its
Controlled Affiliates which is currently (or following the passage of time,
the occurrence of any event or the giving of notice), directly or
indirectly, exchangeable or
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exercisable for, or convertible into, any Voting Securities shall
constitute a Disposition of such Voting Securities.
(a) Dispositions may be made to a Controlled Affiliate
of Shareholder; provided, that such Controlled Affiliate agrees in writing
to be bound by this Agreement to the same extent as Shareholder.
(b) Dispositions of Voting Securities may be made
pursuant to a bona fide public offering in a firm commitment or best
efforts underwriting managed by a United States nationally recognized
underwriter, effected in accordance with the registration rights provisions
in Article 5 and which provides for a widely distributed public offering in
accordance therewith (an "Underwritten Offering"); provided, that, prior to
any such Disposition, Shareholder and its Controlled Affiliates shall have
complied with the provisions of Section 4.2 or Section 4.3 hereof, as the
case may be; provided, further, that such Dispositions shall not be made to
any Person who or which, together with such Person's Affiliates and the
members of any Group existing with respect to Voting Securities of which
such Person is a part (any such Person and its Affiliates and Group members
being collectively referred to herein as a "Purchasing Person"), would
immediately thereafter, to the knowledge of Shareholder, any of its
Controlled Affiliates, or the managing underwriter(s) beneficially own
Voting Securities representing three and one-half percent (3.5%) or more
of the Total Voting Power.
(c) Dispositions of Voting Securities may be made
pursuant to sales effected in accordance with Rule 144 under the Securities
Act (or any successor rule) (a "Rule 144 Sale"); provided that, prior to
any such Disposition, Shareholder and its Controlled Affiliates shall have
complied with the provisions of Section 4.2 or Section 4.3 hereof, as the
case may be; provided, further, that such Dispositions shall not be made to
any Purchasing Person who or which would immediately thereafter, to the
knowledge of Shareholder, any of its Controlled Affiliates, or
Shareholder's broker, beneficially own Voting Securities representing three
and one-half percent (3.5%) or more of the Total Voting Power.
(d) Dispositions may be made to any Purchasing Person
(other than pursuant to a tender or exchange offer) that would, following
such sale, beneficially own no more than three and one-half percent (3.5%)
of the Total Voting Power (a "Private Sale") (and such Purchasing Person
shall have provided a certificate to such effect); provided that prior to
such Disposition, Shareholder shall have complied with the provisions of
Section 4.2 or Section 4.3 hereof, as the case may be.
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(e) Dispositions may be made to the Company in
accordance with Sections 4.2 and 4.3 hereof.
(f) Dispositions may be made pursuant to a tender offer
or exchange offer or any other transaction with a third party (a "Third
Party Offeror") which is recommended to the shareholders of the Company
generally by at least a majority of the Continuing Directors of the
Company. "Continuing Director" shall mean a member of the Board of
Directors of the Company who is not a Third Party Offeror or an Affiliate
of a Third Party Offeror (or a representative or nominee of a Third Party
Offeror or any such Affiliate) and who either (i) was a member of the Board
of Directors prior to the date hereof or (ii) subsequently became a
director of the Company and whose election or nomination for election was
approved or recommended by a vote of a majority of the Board of Directors
of the Company, which majority included a majority of the Continuing
Directors then on the Board of Directors.
(g) With respect to Voting Securities which are, by
their terms, convertible into or exercisable or exchangeable for other
Voting Securities (including the Preferred Shares) such conversion,
exercise or exchange shall not be deemed a Disposition.
(h) Dispositions may be made pursuant to one or more
bona fide pledges or grants of a security interest in Voting Securities to
a major brokerage firm or financial institution to secure bona fide
indebtedness, or the sale of such Voting Securities by foreclosure on such
pledge; provided that such lender is not an Affiliate of Shareholder and
such lender agrees that (i) in the case of any such pledge of Voting
Securities or grant in respect of Voting Securities representing three and
one half percent (3.5%) or less of the Total Voting Power, it will abide by
the provisions of Sections 4.2 or 4.3, as the case may be, in the event of
such foreclosure and (ii) in the case of any such pledge of Voting
Securities or grant in respect of Voting Securities representing more than
three and one half percent (3.5%) of the Total Voting Power, such lender
shall be bound by all of the provisions of this Agreement in the event of
such foreclosure (except that such lender and its transferees shall not be
entitled to the benefits of Section 3.2).
(i) Shareholder agrees, without the consent of the
managing underwriter(s) in an underwritten offering in respect of the
Company's securities, not to effect any sale or distribution of Voting
Securities (other than in connection with Shareholder's own registration
pursuant to paragraph (b) hereof), including a Rule 144 Sale, during the
ten (10) day period prior to, and during the ninety (90) day period
beginning on, the effective date of the
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registration statement filed by the Company in respect of such underwritten
offering.
SECTION 4.2 Company's Right to Purchase Preferred Shares.
Prior to any Disposition of Preferred Shares pursuant to Section 4.1(b),
4.1(c) or Section 4.1(d) hereof, the Company shall have the right,
exercisable in accordance with this Section 4.2, to purchase any or all of
the Preferred Shares intended to be subject to such Disposition by
Shareholder or any of its Controlled Affiliates.
(a) If Shareholder or any of its Controlled Affiliates
wishes to effect any Disposition of Preferred Shares pursuant to Section
4.1(b), Section 4.1(c) or Section 4.1(d) hereof, Shareholder shall give
written notice (a "Preliminary Transfer Notice") to the Company of such
intended Disposition, specifying the Preferred Shares to be subject to
Disposition and the intended method of Disposition (and including, to the
extent known, the identity of any prospective purchasers and, in respect of
a proposed Private Sale, the price at which, and the material terms upon
which (including the identity of any prospective purchaser), such sale is
proposed to be made); provided that any request for registration of Subject
Stock constituting Preferred Shares shall be deemed a Preliminary Transfer
Notice with respect to the Registrable Securities requested to be
registered. The Preliminary Transfer Notice shall be given not less than
twenty (20) nor more than thirty (30) trading days in advance of the
Transfer Notice. If Shareholder determines that it wishes to proceed with
its proposed Underwritten Offering, Rule 144 Sale or Private Sale,
Shareholder shall deliver to the Company a written notice to that effect
containing the same scope of information as in the Preliminary Transfer
Notice (the "Transfer Notice") within the time period prescribed in the
preceding sentence. If the Company wishes to purchase the Preferred
Shares specified in the Transfer Notice, then in the case of a proposed
Private Sale within five (5) trading days, and in the case of other such
Dispositions within twenty (20) trading days, following receipt of the
Transfer Notice, the Company shall deliver a written notice (an "Exercise
Notice") to Shareholder indicating that the Company wishes to exercise its
rights hereunder to purchase such number of such Preferred Shares as
designated in the Exercise Notice, a date for the closing of such purchase,
which shall not be more than ten (10) trading days after delivery of such
Exercise Notice (subject to extension as provided herein), and a place for
the closing of such purchase (a "Section 4.2 Closing"). Upon delivery of
an Exercise Notice, a binding agreement shall be deemed to exist providing
for the purchase by the Company of the Preferred Shares to which such
Exercise Notice relates, upon the terms and subject to the conditions set
forth in this Section 4.2; provided that, other than with respect to a
Private Sale, the Company may rescind its
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Exercise Notice (in which event it will not have obligation to purchase
such Preferred Shares) at any time within five (5) trading days following
any determination of the value of any untraded securities pursuant to
Section 4.2(b)(ii) hereof.
(b) The purchase price for any such Preferred Shares
(the "Purchase Price") shall be determined as set forth below.
(i) With respect to Preferred Shares proposed to
be sold pursuant to a Private Sale, the Purchase Price per
share of such Preferred Shares shall equal the price contained
in the Transfer Notice. With respect to Preferred Shares
proposed to be sold pursuant to an Underwritten Offering or a
Rule 144 Sale, the Purchase Price per share of such Preferred
Shares shall equal the average closing price per share of the
Preferred Shares during the twenty (20) consecutive trading
days immediately preceding the Company's delivery of the
Exercise Notice. The closing price (the "Market Price") for
each such day shall be the last sale price regular way, or, in
case no such sale takes place on such day, the average of the
closing bid and asked prices regular way, in either case on the
NYSE, or, if the Preferred Shares are not listed or admitted to
trading on such exchange, on the principal national or
international securities exchange on which the Preferred Shares
are listed or admitted to trading, or, if the Preferred Shares
are not listed or admitted to trading on any national or
international securities exchange but are designated as
national market system securities by the National Association
of Securities Dealers, Inc. ("NASD"), the last sale price, or,
in case no such sale takes place on such day, the average of
the closing bid and asked prices, in either case as reported on
the NASD Automated Quotation/National Market System, or if the
Preferred Shares are not so designated as national market
system securities, the average of the highest reported bid and
lowest reported asked prices as furnished by the NASD or
similar organization if the NASD is no longer reporting such
information.
(ii) If the Preferred Shares are not publicly
traded as contemplated pursuant to clause (i) above, the value
of the Preferred Shares shall be determined by two United
States nationally recognized investment banking firms, one firm
to be selected by each of Shareholder and the Company, or in
the event such firms are unable to agree, by a third United
States nationally recognized investment banking firm selected
by such firms.
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Shareholder and the Company shall use their reasonable best
efforts to cause any such determination of value to be made
within ten trading days following the Company's delivery of the
applicable Exercise Notice. In connection with any
determination of fair market value pursuant to this Section
4.2(b), each party will bear the fees and expenses of the
investment banking firm selected by it and the parties will
bear equally the fees and expenses of any third investment
banking firm.
(c) At any Section 4.2 Closing, the Company shall pay
to Shareholder (or its designees) the aggregate Purchase Price for the
Preferred Shares by wire transfer of immediately available funds in United
States dollars, and Shareholder shall deliver or cause to be delivered to
the Company such Preferred Shares, with documentation satisfactory to the
Company evidencing the transfer of such Preferred Shares, in form
acceptable for transfer on the Company's books.
(d) If the Company does not exercise its right to
purchase Preferred Shares specified in a Transfer Notice, or if the Company
exercises its right to rescind as described in the proviso to the last
sentence of Section 4.2 (a) hereof, then the party giving such Transfer
Notice shall be free to effect the Disposition of such Preferred Shares,
subject to Section 4.1 hereof (other than the restrictions contained
therein relating to the Company's purchase rights under this Section 4.2);
provided that, in the case of a Disposition pursuant to an Underwritten
Offering, Shareholder may effect such Disposition in accordance with the
provisions of this Agreement in an Underwritten Offering that is
consummated at any time within one hundred and twenty (120) days after the
last date on which the Company's Exercise Notice could have been timely
delivered; provided, further that in the case of a Disposition pursuant to
a Rule 144 Sale, Shareholder may effect such Disposition in accordance with
the provisions of this Agreement in a Rule 144 Sale within thirty (30) days
following the last date on which the Company's Exercise Notice could have
been timely delivered.
(e) The obligations of the parties to effect any
Section 4.2 Closing shall be subject to the satisfaction of the following
conditions: (i) all waiting periods, if any, applicable to the
transactions occurring at such Section 4.2 Closing under the Xxxx-Xxxxx-
Xxxxxx Antitrust Improvements Act of 1976, as amended, shall have expired
or been terminated and (ii) no statute, rule, regulation, executive order,
decree, ruling, injunction or other order shall have been enacted, entered,
promulgated or enforced by any court or governmental authority of competent
jurisdiction which prohibits such transactions or makes such transactions
illegal. If, as of any date on which a Section 4.2 Closing is scheduled to
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occur, the foregoing conditions relating thereto have not been satisfied,
then such Section 4.2 Closing shall occur as promptly as practicable
following such satisfaction, and the parties shall use their reasonable
best efforts to cause the satisfaction of such conditions; provided that if
the foregoing conditions relating to any Section 4.2 Closing are not
satisfied within one hundred twenty (120) days following the delivery of
the applicable Exercise Notice, then Shareholder or the Company may
terminate the agreement deemed to exist upon delivery of the applicable
Exercise Notice.
SECTION 4.3 Company's Right to Purchase Common Shares.
(a) If Shareholder or any of its Controlled Affiliates wishes to effect any
Disposition of shares of Common Stock pursuant to Section 4.1(b), Section
4.1(c) or Section 4.1(d), Shareholder will so notify the Company. Such
notice shall indicate whether such Disposition will occur pursuant to
Section 4.1(b), 4.1(c) or 4.1(d). In the event Shareholder has obtained a
bona fide offer for such shares at a price higher than the Market Price on
the Business Day immediately preceding such notice, the notice shall
indicate such higher price, together with the identity of the proposed
purchaser and any other material terms in the case of a Private Sale. The
Company shall have the right to purchase all (but not less than all) of the
shares of Common Stock at the higher of the Market Price on the Business
Day immediately preceding such notice or the higher price specified in such
notice, if any. As promptly as practicable, and in no event more than
twenty-four (24) hours after receipt of such notice from Shareholder, the
Company shall advise Shareholder if it will purchase such shares of Common
Stock.
If the Company elects not to purchase such shares of Common
Stock or if the Company fails to agree to purchase such shares of Common
Stock on the terms provided herein within twenty-four (24) hours of receipt
of notice, then Shareholder shall be free to undertake the Disposition of
such shares. In case the notice shall have specified that such Disposition
would occur pursuant to Section 4.1(b), then Shareholder may effect such
disposition in accordance with the provisions of this Agreement in an
Underwritten Offering that is consummated at any time within one hundred
and twenty (120) days after receipt by the Company of such notice. In case
the notice shall have specified that such Disposition would occur pursuant
to Section 4.1(c) or 4.1(d), then Shareholder shall have twenty (20)
Business Days to offer and sell such Common Stock. In any case, any such
sale may occur at a price above or below the Market Price, but in the case
of a Private Sale such sale may not occur at a price less than the price at
which such shares were offered to the Company if the price at which such
shares were so offered exceeded the Market Price on the date of such offer
to the Company.
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(b) If the Company agrees to purchase any shares of Common
Stock pursuant to clause (a) above, the provisions of Section 4.2(c) and
Section 4.2(e) shall apply to such purchase as if it were a Section 4.2
Closing.
SECTION 4.4 Assignment of Rights. The Company may assign
any of its rights under this Article 4 to any Person without the consent
of Shareholder, provided, however, that no such assignment shall relieve
the Company of any of its obligations pursuant to this Article 4. In the
event that the Company elects to exercise a right to purchase any Voting
Securities under this Article 4, the Company may specify another Person as
the Company's designee to purchase the Voting Securities.
SECTION 4.5 Required Dispositions. (a) The Company
acknowledges that Shareholder's Voting Power relative to Total Voting Power
may from time to time exceed 19.95% solely as a result of the Company's
repurchase of its own outstanding Voting Securities or reclassifications by
the Company of Voting Securities. If, as a result of such Company
repurchases or reclassifications, Shareholder shall at any time during the
Standstill Period beneficially own Voting Securities having Voting Power
that is more than 23.45% of Total Voting Power (the "Cap"), then, if and to
the extent requested by the Company by written notice to Shareholder,
Shareholder shall, within eighteen (18) months after such request, dispose
of or cause its Controlled Affiliates to dispose of (a "Required
Disposition") such number of shares of Voting Securities pursuant to
Article 4 hereof as shall be necessary to reduce Shareholder's beneficial
ownership of Total Voting Power to no more than the Cap.
ARTICLE 5
Registration Rights
SECTION 5.1 Registration Upon Request. At any time after
June 30, 1996, Shareholder shall have the right to make written demand upon
the Company, on not more than eight (8) separate occasions (subject to the
provisions of this Section 5.1), to register under the Securities Act, the
Common Stock, the Preferred Shares, the shares of Common Stock received by
Shareholder pursuant to the conversion of the Preferred Shares and any
additional Preferred Shares or shares of Common Stock which Shareholder may
have acquired after the date hereof to the extent such additional shares
were acquired by Shareholder in compliance with the terms of this Agreement
(the shares subject to such demand hereunder being referred to as the
"Subject Stock"), and the Company shall use its reasonable efforts to cause
such shares to be registered under the Securities Act as soon as reasonably
practicable so as to permit the sale thereof; provided, however,
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that each such demand shall cover at least five hundred thousand (500,000)
shares of Subject Stock constituting Preferred Shares or one million
(1,000,000) shares of Subject Stock constituting shares of Common Stock
(subject to adjustment for stock splits, reverse stock splits, stock
dividends and similar events after the date hereof). In connection
therewith, the Company shall, as expeditiously as possible, prepare and
file with the Commission, a registration statement under the Securities Act
to effect such registration, and use reasonable efforts to cause such
registration statement to become and remain effective for at least ninety
(90) days. Shareholder agrees to provide all such information and
materials and to take all such action as may be reasonably required in
order to permit the Company to comply with all applicable requirements of
the Securities Act and the Commission and to obtain any desired
acceleration of the effective date of such registration statement. If the
offering to be registered is to be underwritten, the managing underwriter
shall be selected by Shareholder and shall be reasonably satisfactory to
the Company, and Shareholder and such underwriter shall enter into an
underwriting agreement containing customary terms and conditions.
Notwithstanding the foregoing, the Company (i) shall not be obligated to
prepare or file more than one such registration statement during any
twelve (12) month period, (ii) shall be entitled to postpone for a
reasonable period of time (but in no event more than one hundred-twenty
(120) days) the filing of any registration statement otherwise required to
be prepared and filed by the Company if (x) the Company is, at such time,
conducting or about to conduct an underwritten public offering of
securities and is advised by its managing underwriter or underwriters that
such offering would, in its or their opinion, be adversely affected by the
registration so requested, or (y) the Company determines in good faith that
the registration and distribution of the shares of Subject Stock would
interfere with any existing or proposed financing, acquisition,
disposition, corporate reorganization or other transaction of a similar
type involving the Company. In the event of such postponement, Shareholder
shall have the right to withdraw the request for registration by giving
written notice to the Company within ten (10) days after receipt of the
notice of postponement (and, in the event of such withdrawal, such request
shall not be counted for purposes of determining the number of
registrations to which Shareholder is entitled pursuant to this Section
5.1).
SECTION 5.2 Incidental Registration Rights. If the
Company proposes to register any of the Preferred Shares or Common Stock
for sale under the Securities Act (other than (i) pursuant to Section 5.1
hereof, (ii) securities to be issued pursuant to a stock option or other
employee benefit or similar plan, or (iii) securities proposed to be issued
in exchange for securities or assets of, or in connection with a merger or
consolidation with,
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another corporation) the Company shall, as promptly as practicable and in
no event less than thirty (30) days prior to the date such registration
statement is filed with the Commission, give written notice to Shareholder
of the Company's intention to effect such registration. If, within fifteen
(15) days after receipt of such notice, Shareholder submits a written
request to the Company specifying the amount of Subject Stock that it
proposes to sell or otherwise dispose of in accordance with this Section
5.2, the Company shall use reasonable efforts to include the shares
specified in Shareholder's request in such registration. If the offering
pursuant to such registration statement is to be made by or through
underwriters, the managing underwriters shall be chosen by the Company in
its sole discretion, and the Company, Shareholder and such underwriter
shall execute an underwriting agreement in customary form. If the managing
underwriter determines in good faith and advises Shareholder that the
inclusion in the registration statement of all the Subject Stock proposed
to be included would interfere with the successful marketing of all
securities proposed to be registered, then Shareholder shall agree to
downward adjustment in the number of shares of Subject Stock to be included
in such underwriting sufficient to alleviate fully such marketing concern
(provided that if securities are being offered for the account of Persons
other than the Company (other than pursuant to demand registration rights),
then the proportion by which the amount of securities intended to be
offered for the account of Shareholder is reduced shall not exceed the
proportion by which the amount of such securities intended to be offered
for the account of such other Person is reduced). If Shareholder has been
permitted to participate in a proposed offering pursuant to this Section
5.2, the Company thereafter may determine either not to file a registration
statement relating thereto, or to withdraw such registration statement, or
otherwise not to consummate such offering, without any liability hereunder.
In connection with any offering of shares of Subject Stock registered
pursuant to Section 5.1 or 5.2 hereof, Shareholder shall comply with all
other terms of this Agreement (including Section 4.1(b), and in connection
with Section 4.1(b), Shareholder shall use all reasonable efforts to secure
the agreement of the underwriters, in connection with any underwritten
offering of its Subject Stock, to comply therewith).
SECTION 5.3 Registration Mechanics. In connection with
any offering of shares of Subject Stock registered pursuant to Section 5.1
or 5.2 hereof, the Company shall (i) furnish to Shareholder such number of
copies of any prospectus (including preliminary and summary prospectuses)
and conformed copies of the registration statement (including amendments or
supplements thereto and, in each case, all exhibits) and such other
documents as it may reasonably request, but only while the Company shall be
required under the provisions hereof to cause the registration statement to
remain current; (ii) (x) use reasonable efforts to register or
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qualify the Subject Stock covered by such registration statement under such
blue sky or other state securities laws for offer and sale as Shareholder
shall reasonably request and (y) keep such registration or qualification in
effect for so long as the registration statement remains in effect;
provided, however, that the Company shall not be obligated to qualify to do
business as a foreign corporation under the laws of any jurisdiction in
which it shall not then be qualified or to file any general consent to
service of process in any jurisdiction in which such a consent has not been
previously filed or subject itself to taxation in any jurisdiction wherein
it would not otherwise be subject to tax but for the requirements of this
Section 5.3; (iii) use reasonable efforts to cause all shares of Subject
Stock covered by such registration statement to be registered with or
approved by such other federal or state government agencies or authorities
as may be necessary in the opinion of counsel to the Company to enable
Shareholder to consummate the Disposition of such shares of Subject Stock;
(iv) notify Shareholder any time when a prospectus relating thereto is
required to be delivered under the Securities Act upon discovery that, or
upon the happening of any event as a result of which, the prospectus
included in such registration statement, as then in effect, includes an
untrue statement of a material fact or omits to state any material fact
required to be stated therein or necessary to make the statements therein
not misleading, in the light of the circumstances under which they were
made, and (subject to the good faith determination of the Board of
Directors as to whether to cease all sales under such registration
statement), at the request of Shareholder prepare and furnish to it a
reasonable number of copies of a supplement to or an amendment of such
prospectus as may be necessary so that, as thereafter delivered to the
purchasers of such securities, such prospectus shall not include an untrue
statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein not
misleading, in the light of the circumstances under which they were made;
(v) otherwise use reasonable efforts to comply with all applicable rules
and regulations of the Commission; (vi) use reasonable efforts to list, if
required by the rules of the applicable securities exchange or, if
securities of the same class are then so listed, the Subject Stock covered
by such registration statement on the NYSE, the Paris Stock Exchange and on
any other principal securities exchange on which such class of Voting
Securities is then listed; and (vii) before filing any registration
statement or any amendment or supplement thereto, furnish to Shareholder
and its counsel copies of such documents and permit Shareholder and its
counsel to review and comment on such documents. Upon any registration
becoming effective pursuant to Section 5.1, the Company shall use
reasonable efforts to keep such registration statement current for a period
of ninety (90) days or such shorter period as shall be necessary to effect
the distribution of the Subject Stock.
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Shareholder agrees that upon receipt of any notice from the
Company of the happening of any event of the kind described in clause (iv)
of this Section 5.3, it will forthwith discontinue its Disposition of
Subject Stock pursuant to the registration statement relating to such
Subject Stock until its receipt of the copies of the supplemented or
amended prospectus contemplated by clause (iv) of this Section 5.3 and, if
so directed by the Company, will deliver to the Company all copies then in
its possession of the prospectus relating to such Subject Stock current at
the time of receipt of such notice. If Shareholder's Disposition of
Subject Stock is discontinued pursuant to the foregoing sentence, unless
the Company thereafter extends the effectiveness of the registration
statement to permit Dispositions of Subject Stock by Shareholder at least
thirty (30) consecutive days and for an aggregate of ninety (90) days,
whether or not consecutive, the registration statement shall not be counted
for purposes of determining the number of registrations to which
Shareholder is entitled pursuant to Section 5.1.
SECTION 5.4 Expenses. Shareholder shall pay all agent
fees and commissions and underwriting discounts and commissions related to
shares of Subject Stock being sold by Shareholder and the fees and
disbursements of its counsel and accountants and the Company shall pay all
fees and disbursements of its counsel and accountants in connection with
any registration pursuant to this Article 5; provided that all fees and
disbursements in connection with any registration (excluding any withdrawn
registration request) pursuant to this Article 5 in excess of the first
four (4) actual such registrations shall be borne by the Shareholder. All
other fees and expenses in connection with any registration statement
(including, without limitation, all registration and filing fees, all
printing costs, all fees and expenses of complying with securities or blue
sky laws) shall (i) in the case of a registration pursuant to Section 5.1,
be borne solely by Shareholder and (ii) in the case of a registration
pursuant to Section 5.2, be shared pro rata based upon the respective
market values of the securities to be sold by the Company, Shareholder and
any other holders participating in such offering.
SECTION 5.5 Indemnification and Contribution. In the
case of any offering registered pursuant to this Article 5, the Company
agrees to indemnify and hold Shareholder, each underwriter, if any, of the
Subject Stock under such registration and each Person who controls any of
the foregoing within the meaning of Section 15 of the Securities Act, and
any directors and officers of the foregoing, harmless against any and all
losses, claims, damages, or liabilities (including reasonable legal fees
and other reasonable expenses incurred in the investigation and defense
thereof) to which they or any of them may become subject under the
Securities Act or otherwise (collectively "Losses"), insofar as any
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such Losses shall arise out of or shall be based upon (i) any untrue
statement or alleged untrue statement of a material fact contained in the
registration statement relating to the sale of such Subject Stock, or the
omission or alleged omission to state therein a material fact required to
be stated therein or necessary to make the statements therein not
misleading or (ii) any untrue statement or alleged untrue statement of a
material fact contained in the prospectus relating to the sale of such
Subject Stock, or the omission or alleged omission to state therein a
material fact necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading, provided,
however, that the indemnification contained in this Section 5.5 shall not
apply to such Losses which shall arise out of or shall be based upon any
such untrue statement, or any such omission or alleged omission, which
shall have been made in reliance upon and in conformity with information
furnished in writing to the Company by Shareholder or any such underwriter,
as the case may be, specifically for use in connection with the preparation
of the registration statement or prospectus contained in the registration
statement or any such amendment thereof or supplement therein.
In the case of each offering registered pursuant to this
Article 5, Shareholder and each underwriter, if any, participating therein
shall agree, substantially in the same manner and to the same extent as set
forth in the preceding paragraph, severally to indemnify and hold harmless
the Company and each Person, if any, who controls the Company within the
meaning of Section 15 of the Securities Act, and the directors and officers
of the Company, with respect to any statement in or omission from such
registration statement or prospectus contained in such registration
statement (as amended or as supplemented, if amended or supplemented as
aforesaid) if such statement or omission shall have been made in reliance
upon and in conformity with information furnished in writing to the Company
by Shareholder or such underwriter, as the case may be, specifically for
use in connection with the preparation of such registration statement or
prospectus contained in such registration statement or any such amendment
thereof or supplement thereto.
Each party indemnified under this Section 5.5 shall, promptly
after receipt of notice of the commencement of any claim against such
indemnified party in respect of which indemnity may be sought hereunder,
notify the indemnifying party in writing of the commencement thereof. The
failure of any indemnified party to so notify an indemnifying party shall
not relieve the indemnifying party from any liability in respect of such
action which it may have to such indemnified party on account of the
indemnity contained in this Section 5.5, unless (and only to the extent)
the indemnifying party was prejudiced by such failure, and in no event
shall such failure relieve the indemnifying party from any other
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liability which it may have to such indemnified party. In case any action
in respect of which indemnification may be sought hereunder shall be
brought against any indemnified party and it shall notify an indemnifying
party of the commencement thereof, the indemnifying party shall be entitled
to participate therein and, to the extent that it may desire, jointly with
any other indemnifying party similarly notified, to assume the defense
thereof through counsel reasonably satisfactory to the indemnified party,
and after notice from the indemnifying party to such indemnified party of
its election so to assume the defense thereof, the indemnifying party shall
not be liable to such indemnified party under this Section 5.5 for any
legal or other expenses subsequently incurred by such indemnified party in
connection with the defense thereof, other than reasonable costs of
investigation (unless such indemnified party reasonably objects to such
assumption on the grounds that there may be defenses available to it which
are different from or in addition to those available to such indemnifying
party in which event the indemnified party shall be reimbursed by the
indemnifying party for the reasonable expenses incurred in connection with
retaining separate legal counsel). No indemnifying party shall, without
the prior written consent of the indemnified party, effect any settlement
of any claim or pending or threatened proceeding in respect of which the
indemnified party is or could have been a party and indemnity could have
been sought hereunder by such indemnified party, unless such settlement
includes an unconditional release of such indemnified party from all
liability arising out of such claim or proceeding.
If the indemnification provided for in this Section 5.5 is
unavailable to an indemnified party or is insufficient to hold such
indemnified party harmless from any Losses in respect of which this Section
5.5 would otherwise apply by its terms (other than by reason of exceptions
provided herein), then each applicable indemnifying party, in lieu of
indemnifying such indemnified party, shall have a joint and several
obligation to contribute to the amount paid or payable by such indemnified
party as a result of such Losses, in such proportion as is appropriate to
reflect the relative fault of the indemnifying party, on the one hand, and
such indemnified party, on the other hand, in connection with the offering
to which such contribution relates as well as any other relevant equitable
considerations. The relative fault shall be determined by reference to,
among other things, each party's relative knowledge and access to
information concerning the matter with respect to which the claim was
asserted, and the opportunity to correct and prevent any statement or
omission. The amount paid or payable by a party as a result of any Losses
shall be deemed to include any legal or other fees or expenses incurred by
such party in connection with any investigation or proceeding to the extent
such party would have been indemnified for such expenses if the
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indemnification provided for in this Section 5.5 was available to such
party.
The parties hereto agree that it would not be just and
equitable if contribution pursuant to this Section 5.5 were determined by
pro rata allocation or by any other method of allocation that does not take
account of the equitable considerations referred to in the immediately
preceding paragraph. No person guilty of fraudulent misrepresentation
(within the meaning of Section 11(f) of the Securities Act) shall be
entitled to contribution from any person who was not guilty of such
fraudulent misrepresentation.
SECTION 5.6. Assignment of Registration Rights. Shareholder
may, in connection with any transfer of its Voting Securities permitted by
this Agreement, assign its rights under this Article 5 to any Controlled
Affiliate without the Company's consent and, in the case of an assignment
to a Person which is not a Controlled Affiliate, with the Company's
consent, which consent shall not be unreasonably withheld (provided that if
such assignment is to a Person other than a Controlled Affiliate, any
demand registration requested by such assignee pursuant to Section 5.1
hereof shall be for a minimum of one million (1,000,000) Preferred Shares
or two million (2,000,000) shares of Common Stock, respectively).
SECTION 5.7. Termination. The registration rights granted to
Shareholder pursuant to this Article 5 shall terminate immediately at such
time as Shareholder owns Voting Securities having a Voting Power of less
than three and one half percent (3.5%) of the Total Voting Power or if
there is a Designated Shareholder Breach.
ARTICLE 6
Standstill Provisions Regarding the Shareholder and Certain Entities
SECTION 6.1 Restriction of Certain Actions by the
Company. During the Standstill Period (it being understood that for this
purpose the Standstill Period shall terminate only pursuant to Section
2.1(i)), the Company agrees that none of the Company, any of its Controlled
Affiliates or any Group of which the Company or any such Controlled
Affiliate is a member (it being understood that, for the purposes of this
Section 6.1, the Company is not (x) a member of any Group of which
Shareholder is a member or (y) a Controlled Affiliate of Shareholder or MW)
will in any manner, directly or indirectly, effect or seek, initiate or
propose (whether publicly or otherwise), to effect, or cause or participate
in, or in any way induce, assist or encourage any other Person to
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effect, seek, offer, initiate or propose (whether publicly or otherwise) to
effect or participate in, any unsolicited tender or exchange offer
commenced by a Person for voting securities representing twenty percent
(20%) or more of the total voting power of Shareholder, MW or any of their
material subsidiaries, or an unsolicited proxy or consent solicitation by
any such Person in order to replace at least a majority of the directors of
Shareholder, MW or such subsidiary, (ii) any other proposal to take over
control of Shareholder or MW or for a merger, share exchange, business
combination, recapitalization, restructuring, liquidation or similar
transaction involving Shareholder, MW or any of their material subsidiaries
or any proposal or offer to acquire in any manner voting securities
representing more than twenty percent (20%) of the total voting power of
Shareholder, MW or any of their material subsidiaries, a substantial equity
interest in any of Shareholder's or MW's material subsidiaries or a
substantial portion of the assets of Shareholder or MW or any of their
respective material subsidiaries, (iii) any request to invite any Person to
effect any of the actions specified in this Section 6.1 or any request to
challenge the validity of, waive the benefit of, opt out of, or amend any
provision of, any shareholder rights plan of Shareholder or MW or any anti-
takeover statutes or other anti-takeover provisions applicable to
Shareholder or MW, or (iv) a proposal having similar effect, or (v)
including without limitation any action described in (a) through (c) below,
unless in any such case invited in writing to do so by the board of
directors of Shareholder or MW, as the case may be, as specifically
expressed in a resolution adopted by a majority of the board of directors:
(a) acquire, offer or propose to acquire, or agree to acquire,
whether by purchase, tender or exchange offer, gift or otherwise,
beneficial ownership of any voting securities or any rights to acquire
(whether currently, upon lapse of time, following the satisfaction of any
conditions, upon the occurrence of any event or any confirmation of the
foregoing) any voting securities of Shareholder or MW, as the case may be
(it being understood that, if the Company beneficially owns or acquires any
voting securities of Shareholder or MW, as the case may be, in violation of
this Agreement, such voting securities shall immediately be disposed of to
Persons who are not Affiliates thereof; provided, however, that
Shareholder may also pursue any other available remedies to which it may be
entitled as a result of such violation.
(b) form, join, participate in or encourage the formation of,
any Group with respect to any voting securities of Shareholder or MW or
deposit any voting securities into a voting trust or subject any such
voting securities to a voting agreement or any other arrangement or
agreement with respect to the voting thereof; or
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(c) request Shareholder or MW (or their respective directors,
officers, employees or agents) to amend or waive any provision of this
Agreement (including this paragraph).
SECTION 6.2 Termination. The provisions of Section 6.1
shall terminate on the earlier of (a) the date of a Designated Shareholder
Breach and (b) the date on which the Standstill Period terminates pursuant
to Section 2.1(i). Notwithstanding the foregoing, the provisions of Section
6.1 shall not terminate if, at the time the provisions of Section 6.1 would
have otherwise terminated in accordance with the previous sentence, there
is a Designated Company Breach.
ARTICLE 7
Miscellaneous
SECTION 7.1 Notices. All notices, requests, demands and
other communications required or permitted hereunder shall be made in
writing by hand-delivery, registered first-class mail, telex, fax or air
courier guaranteeing delivery:
(a) If to the Company, to:
Crown Cork & Seal Company, Inc.
0000 Xxxxxx Xxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxxx X. Xxxxx
Chairman and Chief Executive Officer
Telecopy: (000) 000-0000
(with copies to):
Dechert Price & Xxxxxx
4000 Xxxx Atlantic Tower
0000 Xxxx Xxxxxx
Xxxxxxxxxxxx, Xxxxxxxxxxxx 00000
Attention: Xxxxxx X. Xxxxx and
Xxxxxxx X. Xxxxxx
Telecopy: (000) 000-0000
or to such other person or address as the Company shall furnish to
Shareholder in writing;
A-4-33
(b) If to Shareholder, to:
CGIP
00, xxx Xxxxxxxx
00000 Xxxxx, Xxxxxx
Attention: Michel Renault
Telecopy: (000) 00 0 00 00 00 67
(with copies to):
Xxxxxxxx & Xxxxxxxx
000 Xxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000
Attention: Xxxxx X. Xxxxxx
Telecopy: (000)000-0000
or to such other person or address as Shareholder shall furnish to the
Company in writing.
All such notices, requests, demands and other communi-cations
shall be deemed to have been duly given: at the time of delivery by hand,
if personally delivered; five (5) Business Days after being deposited in
the mail, postage prepaid, if mailed domestically in the United States (and
seven (7) Business Days if mailed internationally); when answered back, if
telexed; when receipt acknowledged, if telecopied; and on the Business Day
for which delivery is guaranteed, if timely delivered to an air courier
guaranteeing such delivery.
SECTION 7.2 Survival of Representations and Warranties. The
representations and warranties made herein shall survive through the term
of this Agreement.
SECTION 7.3 Legends. If requested in writing by the Company,
Shareholder shall present or cause to be presented promptly all
certificates representing Voting Securities beneficially owned by
Shareholder or any of its Controlled Affiliates, for the placement thereon
of a legend substantially to the following effect, which legend will remain
thereon as long as such Voting Securities are beneficially owned by
Shareholder or a Controlled Affiliate:
"The securities represented by this certificate are
subject to the provisions of a Shareholders Agreement,
dated as of February 22, 1996, between Compagnie Generale
d'Industrie et de Participations and Crown Cork & Seal
Company, Inc. and may not be sold, pledged, hypothecated
or otherwise transferred except in accordance therewith.
A copy of said agreement is on file at the office of the
Corporate Secretary of Crown Cork & Seal Company, Inc."
A-4-34
The Company may enter a stop transfer order with the transfer
agent or agents of Voting Securities against any Disposition not in
compliance with the provisions of this Agreement.
SECTION 7.4 Enforcement. Shareholder, on the one hand, and the
Company, on the other hand, acknowledge and agree that irreparable injury
to the other party would occur in the event any of the provisions of this
Agreement were not performed in accordance with their specific terms or
were otherwise breached and that such injury would not be adequately
compensable in damages. It is accordingly agreed that, in addition to any
other remedies which may be available at law or in equity, each party
hereto (the "Moving Party") shall be entitled to specific enforcement of,
and injunctive relief to prevent any violation of, the terms hereof, and
the other parties hereto will not take action, directly or indirectly, in
opposition to the Moving Party seeking such relief on the grounds that any
other remedy or relief is available at law or in equity. The parties
further agree that no bond shall be required as a condition to the granting
of any such relief.
SECTION 7.5 Entire Agreement. This Agreement, the second,
third, sixth and fifteenth paragraphs of the Shareholder Confidentiality
Agreement (but not to the extent such paragraphs relate to information or
"Evaluation Material" of the "Subject Company", as such terms are used in
the Shareholder Confidentiality Agreement), the second, third, seventh and
seventeenth paragraphs of the Crown Confidentiality Agreement and the
Exchange Offer Agreement constitute the entire agreement and understanding
of the parties with respect to the transactions contemplated hereby and
thereby, and the Company Confidentiality Agreement and such other
provisions of the Shareholder Confidentiality Agreement and Crown
Confidentiality Agreement not expressly referred to above shall terminate
with the execution hereof. This Agreement may be amended only by a written
instrument duly executed by the parties or their respective successors or
assigns.
SECTION 7.6 Severability. Whenever possible, each provision or
portion of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law, but if any provision or portion
of any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable law, rule or regulation
in any jurisdiction, such invalidity, illegality or unenforceability will
not affect any other provision or portion of any provision in such
jurisdiction, and this Agreement will be reformed, construed and enforced
in such jurisdiction as if such invalid, illegal or unenforceable provision
or portion of any provision shall have been replaced with a provision which
shall, to the maximum extent permissible under such applicable law, rule or
regulation, give effect to the intention of
A-4-35
the parties as expressed in such invalid, illegal or unenforceable
provision.
SECTION 7.7 Headings. Descriptive headings contained in the
Agreement are for convenience only and will not control or affect the
meaning or construction of any provision of this Agreement.
SECTION 7.8 Counterparts. For the convenience of the parties,
any number of counterparts of this Agreement may be executed by the
parties, and each such executed counterpart will be an original instrument.
SECTION 7.9 No Waiver. Any waiver by any party of a breach of
any provision of this Agreement shall not operate as or be construed to be
a waiver of any other breach of such provision or of any breach of any
other provision of this Agreement. The failure of a party to insist upon
strict adherence to any term of this Agreement on one or more occasions
shall not be considered a waiver or deprive that party of the right
thereafter to insist upon strict adherence to that term or any other term
of this Agreement.
SECTION 7.10 Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the Company and Shareholder, and
to their respective successors and assigns, including any successors to the
Company or Shareholder or their businesses or assets as the result of any
merger, consolidation, reorganization, transfer of assets or otherwise, and
any subsequent successor thereto, without the execution or filing of any
instrument or the performance of any act; provided that no party may assign
this Agreement without the other party's prior written consent, except as
expressly provided herein.
SECTION 7.11 Governing Law. This Agreement will be governed by
and construed and enforced in accordance with the internal laws of the
Commonwealth of Pennsylvania, without giving effect to the conflict of laws
principles thereof.
SECTION 7.12 Further Assurances. From time to time on and
after the date hereof, the Company and Shareholder, as the case may be,
shall deliver or cause to be delivered to the other party hereto such
further documents and instruments and shall do and cause to be done such
further acts as the other party hereto shall reasonably request to carry
out more effectively the provisions and purposes of this Agreement, to
evidence compliance herewith or to assure that it is protected in acting
hereunder.
SECTION 7.13 Consent to Jurisdiction and Service of Process.
Any legal action or proceeding with respect to this Agreement or any
matters arising out of or in connection with this
A-4-36
Agreement (other than the Exchange Offer Agreement, which shall be governed
solely by the analogous provisions thereof), and any action for enforcement
of any judgment in respect thereof shall be brought exclusively in the
Court of Common Pleas of Philadelphia County in the Commonwealth of
Pennsylvania or the United States District Court for the Eastern District
of Pennsylvania, and, by execution and delivery of this Agreement, the
Company and Shareholder each irrevocably consent to service of process out
of any of the aforementioned courts in any such action or proceeding by the
mailing of copies thereof by registered or certified mail, postage prepaid,
or by recognized international express carrier or delivery service, to the
Company or Shareholder at their respective addresses referred to herein.
The Company and the Shareholder each hereby irrevocably waives any
objection which it may now or hereafter have to the laying of venue of any
of the aforesaid actions or proceedings arising out of or in connection
with this Agreement (other than the Exchange Offer Agreement, which shall
be governed solely by the analogous provisions thereof) brought in the
courts referred to above and hereby further irrevocably waives and agrees,
to the extent permitted by applicable law, not to plead or claim in any
such court that any such action or proceeding brought in any such court has
been brought in an inconvenient forum. Nothing herein shall affect the
right of any party hereto to serve process in any other manner permitted by
law.
SECTION 7.14 Confidentiality. Confidential information of the
Company on one hand, and the Shareholder on the other hand, shall be deemed
"Evaluation Material" subject to the terms of the second, third, seventh
and seventeenth paragraphs of the Crown Confidentiality Agreement, in the
case of Company information, and subject to the terms of the second, third,
sixth and fifteenth paragraphs of the Shareholder Confidentiality
Agreement, in the case of Shareholder information.
A-4-37
IN WITNESS WHEREOF, the parties hereto have caused this
Agreement to be executed as of the date first referred to above.
CROWN CORK & SEAL COMPANY, INC.
By:
Name:
Title:
COMPAGNIE GENERALE D'INDUSTRIE
ET DE PARTICIPATIONS
By:
Name:
Title:
A-5-1
ANNEX 5
(a) Organization and Qualification. The Company shall be a societe anonyme
duly organized, validly existing and in good standing under the laws of the
Republic of France and shall have the requisite corporate power and authority
to carry on its business as it is now being conducted. The Company shall be
duly qualified as a foreign corporation to do business, and be in good
standing, in each jurisdiction where the character of its properties owned or
leased or the nature of its activities make such qualification necessary,
except where the failure to be so qualified would not, individually or in the
aggregate, result in a Material Adverse Effect on the Company.
(b) Organizational Documents. The Company shall not be in violation of any of
the provisions of its statuts, and its statuts as delivered pursuant to Section
6(i) of this Agreement shall not have been amended, modified, or rescinded and
remain in full force and effect other than as contemplated in the BALO
Announcement.
(c) Capitalization. As of April 30, 1995, the share capital of the Company
totalled FF 823,125,910, consisting of 82,312,591 shares of Common Stock issued
and outstanding, all of which shall have been duly authorized, validly issued
and fully paid and non-assessable, and (ii) 2,095,140 shares of Common Stock
shall have been reserved for future issuance upon exercise of outstanding
employee stock options granted under the Company's stock option plans. Between
April 30, 1995 and the date of this Agreement, there have been no additional
issuances of shares of Common Stock other than issuances upon exercises of
employee stock options outstanding on April 30, 1995. No shares of Common Stock
shall have been owned by the Company or a subsidiary of the Company. Except for
the employee stock options described in clause (ii) of the preceding sentence
and other than in respect of the Faba transaction described in the BALO
Announcement and the granting of options for 200,000 shares of the Common Stock
to the management of the Company (the "New Options"), a maximum of 50,000 of
which shall have been granted per fiscal quarter in the ordinary course of
business, and other than options for up to 44,000 shares of Common Stock to be
granted in respect of stock options authorized in 1994 by the shareholders of
the Company (the "1994 Options") there shall have been no subscriptions,
options, warrants, or other rights, convertible securities, agreements,
arrangements, or commitments of any character relating to the issued or
unissued capital stock of the Company to which the Company or any of its
material Subsidiaries is a party, or by which any of their properties are bound
or affected, or obligating the Company or any of its Subsidiaries to issue or
sell any shares of capital stock of, or other equity interests in, the Company.
At the Closing Date, the share capital of the Company shall total 88,068,398
shares on a fully-diluted basis (assuming the grant of all New Options and the
1994 Options in accordance with this Agreement).
(d) Public Filings. The Company shall have filed all forms, reports, and
documents required to be filed with the COB, CBV, SBF, London Stock Exchange
and other French or U.K. securities law authorities or exchanges (the "French
and U.K. Securities Authorities") since December 31, 1993. The Company Public
Reports (including, without limitation, any financial statements or schedules
included therein) filed on or prior to the Filing Date (i) shall have been
prepared in compliance, in all material respects, with the requirements of
applicable law, and (ii) shall not have at the time of filing (or, if amended,
supplemented, or superseded by a filing prior to the date of this Agreement, on
the date of that filing) contained any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary in
order to make the statements therein, in the light of the circumstances under
which they were made, not misleading. None of the Company or its Subsidiaries
shall be required to file any forms, reports or other documents with the SEC
(whether pursuant to the Securities Act, Exchange Act or otherwise) or any
United States state securities commission. None of the Company or its
Subsidiaries shall have any class of security which is, or is required to be,
registered pursuant to Securities Act or Exchange Act.
(e) Financial Statements. Each of the consolidated financial statements
contained in the Company Public Reports filed on or prior to the Filing Date
and the Company's audited consolidated financial statements for the years ended
December 31, 1993 and December 31, 1994 (together, the "Financial Statements")
(including, in each case, any related notes thereto) shall have been prepared
in accordance with International Accounting
A-5-2
Standards issued by the IASC ("International Accounting Standards") applied on
a consistent basis throughout the periods involved (except as may be indicated
in the notes thereto), and each of them shall have presented fairly in all
material respects the consolidated financial position of the Company and its
Subsidiaries at their respective dates and the consolidated results of their
operations and cash flows for the periods indicated, except that (i) unaudited
interim financial statements included in any quarterly reports may have been
subject to normal and recurring year-end adjustments that were not expected to
be material in amount, and (ii) the Company may, in its sole discretion apply
United States GAAP or International Accounting Standards in effect at December
31, 1994 and December 31, 1993 or International Accounting Standards in effect
on the date of the filing of the Company Public Report with respect to
financial statements in respect of periods subsequent to January 1, 1995,
provided that the Company shall not have changed the annual account period.
(f) Absence of Certain Changes or Events. Except as disclosed in the Company
Public Reports, disclosed to Crown prior to the date of this Agreement or as
contemplated by this Agreement, since December 31, 1994, (i) there shall have
been no Material Adverse Effect on the Company, (ii) the businesses of the
Company and each of its Subsidiaries shall have been conducted only in the
ordinary course, consistent with past practice; (iii) neither the Company nor
any of its Subsidiaries shall have incurred any material liabilities (direct,
contingent or otherwise) or engaged in any material transaction or entered into
any material agreement outside the ordinary course of business; (iv) the
Company and its Subsidiaries shall not have increased in any material respect
the compensation of any officer or granted any general salary or benefits
increase to their employees other than in the ordinary course of business; and
(v) there shall have been no declaration, setting aside or payment of any
dividend or other distribution with respect to the capital stock of the Company
(other than as permitted in Section 10.1(j)). Neither the execution and
delivery of this Agreement by Shareholder nor the performance by Shareholder of
its obligations hereunder will, except as disclosed in writing by Shareholder
to Crown prior to the execution of this Agreement, result in a default (or give
rise to any right of termination, cancellation or acceleration) under any of
the terms, conditions or provisions of any note, bond, mortgage, indenture,
contract, agreement, lease, license, permit, franchise, or other instrument or
obligation to which the Company or any of its Subsidiaries is a party or by
which any of its Subsidiaries or any of their respective assets may be bound,
except for such defaults (or rights of termination, cancellation or
acceleration) as to which requisite waivers or consents have been obtained or
which, in the aggregate, would not result in a Material Adverse Effect on the
Company.
(g) Absence of Litigation. There shall be no civil, criminal, or
administrative claims, actions, suits, proceedings, or investigations pending
or, to the knowledge of the Company, threatened against the Company or any of
its Subsidiaries, or involving any properties or rights of the Company or any
of their Subsidiaries, before any court, arbitrator, or administrative,
governmental, or regulatory authority, domestic or foreign, that, individually
or in the aggregate, shall have had or are likely to have a Material Adverse
Effect on the Company. There shall be no judgments, decrees, injunctions,
rules, or orders of any governmental entity or arbitrator outstanding against
the Company or any of its Subsidiaries that shall have had or are likely to
have a Material Adverse Effect on the Company.
(h) Employee Benefit Plans.
(i) The obligations and liabilities of the Company and its Subsidiaries under
retirement, pension, profit sharing, savings, deferred compensation,
supplemental retirement, bonus, incentive, stock purchase, stock ownership,
stock option, severance, health, life insurance, disability, fringe benefit and
other material employee benefit plans, programs, or arrangements, and any
current or former executive employment, compensation, severance, consulting,
noncompetition, or indemnification agreements, whether written or unwritten,
funded or unfunded (x) maintained, sponsored, administered or contributed to by
the Company or any of its Subsidiaries, or (y) with respect to which the
Company or any of its Subsidiaries has any liability (together, the "Company
Employee Plans") shall have been properly accrued and reflected in the
Financial Statements in accordance with International Accounting Standards in
all material aspects.
(ii) Except for the liabilities accrued and reflected in the Financial
Statements, there shall be no material unfunded liabilities existing with
respect to any Company Employee Plan.
A-5-3
(iii) All of the Company Employee Plans shall have been operated and
administered in material compliance with their terms and shall be in material
compliance with the laws and governmental rules and regulations applicable to
them (including all applicable requirements for notification to participants
and governmental or regulatory authorities), and the Company and each of its
Subsidiaries shall have performed all material obligations required to be
performed by them under, are not in any material respect in default under or in
violation of, and the Company has no knowledge of any material default or
violation by any party to, any of the Company Employee Plans.
(iv) All contributions to, and payments from, any Company Employee Plan
required pursuant to applicable laws, rules and regulations, the terms of the
Company Employee Plan, or any collective bargaining agreement shall have been
made on or before their due dates. All such contributions to, and all payments
from, the Company Employee Plans shall have been properly accrued in accordance
with International Accounting Standards.
(v) Neither the Company nor any of its Subsidiaries shall have taken any
action with respect to any Company Employee Plan that will increase materially
the expense of maintaining such Company Employee Plan above the level of
expense reflected in the Financial Statements (except for the granting of the
New Options and the 1994 Options in accordance with this Agreement).
(vi) Except for claims for benefits in the normal operation of the Company
Employee Plans, there shall be no litigation, proceeding, investigation, audit,
assessment, complaint or proceeding of any kind in any court or governmental
agency with respect to any Company Employee Plan which could reasonably be
expected to have a Material Adverse Effect on the Company and its Subsidiaries,
taken as a whole.
(vii) Neither the Company nor any of its Subsidiaries shall have taken any
action with respect to any Company Employee Plan (including but not limited to
the recognition of the transaction contemplated by this Agreement as a change
of control) that will cause a material discretionary acceleration or increase
in the vesting, exercisability, or benefits provided by any such Company
Employee Plan (except for the granting of the New Options and the 1994 Options
in accordance with this Agreement).
(i) Taxes and Social Obligations. The Company and each of its material
Subsidiaries (i) shall have timely and correctly filed all material returns and
reports relating to Taxes required to be filed by it in the manner required by
the relevant taxing authorities (collectively, "Returns") and (ii) shall have
timely paid all Taxes shown to be due on such Returns and all material Taxes
for which no return was required to be filed. The financial statements included
in the Company Public Reports and the Financial Statements shall have, to the
extent required by International Accounting Standards, an adequate reserve for
all Taxes payable by the Company and its Subsidiaries for all taxable periods
and portions thereof through the date of such financial statements. No material
deficiencies for any Taxes shall have been proposed, asserted or assessed
against the Company or any of its Subsidiaries and no requests for waivers of
the time to assess any such Taxes are pending.
Neither the Company nor any of its Subsidiaries (i) shall have been at the
date of this Agreement the subject of any inquiry, investigation or audit
relating to Taxes or (ii) shall have received notice of any proposed inquiry,
investigation or audit relating to Taxes which is reasonably likely to may have
a Material Adverse Effect on the Company.
(j) Registration Statement; Proxy Statement. The information to be supplied
by or on behalf of the Company for inclusion in the Registration Statement
shall not, at the time the Registration Statement is declared effective or at
the Filing Date, 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 the light of the circumstances under which they
were made, not misleading. The information supplied by or on behalf of the
Company for inclusion in the Proxy Statement shall not have, on the date the
Proxy Statement (or any amendment thereof or supplement thereto) is first
mailed to shareholders, at the time of the Crown Shareholder Meeting, at the
Filing Date, the Commencement Date or the Closing Date, contained any statement
that, in light of the circumstances under which it is made, was false or
misleading with respect to any material fact, omitted to state any material
A-5-4
fact necessary in order to make the statements made therein not false or
misleading, or omitted to state any material fact necessary to correct any
statement in any earlier communication with respect to the solicitation of
proxies for the Crown Shareholder Meeting that had become false or misleading.
(k) Note d'Information, U.K. Filing; Etc. The information supplied by or on
behalf of the Company for inclusion in the Note d'Information, the CBV Filing,
the U.K. Filing and all other filings made in connection with the Exchange
Offers shall not have, at the time such filings received the regulatory
approval or clearance required by applicable law, at the Filing Date, contained
any untrue statement of a material fact or omitted to state any material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading.
1
CROWN CORK & SEAL COMPANY, INC.
0000 XXXXXX XXXX
XXXXXXXXXXXX, XX 00000
Compagnie Generale d'Industrie et
de Participations
00, xxx Xxxxxxxx
00000 Xxxxx, Xxxxxx
Gentlemen:
Reference is made to the Exchange Offer Agreement dated as of May 22, 1995,
as amended as of November 13, 1995 (the "Exchange Offer Agreement"), between
Crown Cork & Seal Company, Inc. ("Crown") and Compagnie Generale d'Industrie et
de Participations ("CGIP"). This letter amends the Exchange Offer Agreement as
set forth herein. Capitalized terms used but not otherwise defined herein have
the meanings ascribed thereto in the Exchange Offer Agreement.
Section 1(h) of the Exchange Offer Agreement is hereby amended and restated
in its entirety as follows:
"Company Options. Subject to applicable law and regulation, and
---------------
subject to the terms of the Company's employee stock options
outstanding on the date of this Agreement, and the New Options and the
1994 Options to the extent issued in accordance with this Agreement
(the outstanding options, the New Options and the 1994 Options are
collectively referred to as the "Outstanding Options"), on the
Commencement Date, Crown shall make an irrevocable offer to each
holder of Outstanding Options in the categories specified in (i) and
(ii) below, subject in all cases to successful completion of the
Offer, and evidenced solely by delivery by Crown of a letter addressed
to Company option holders at the Company's headquarters at 000, xxx xx
Xxxxxxxxxx, 00000 Xxxxx XXXXXX c/o Chief Financial Officer, to settle
such holder's Outstanding Options (or in the case of clause (ii)
below, the shares of Common Stock received upon exercise of such
Outstanding Options) in such categories, as follows:
(i) For each Outstanding Option that (a) is outstanding on the
2
Commencement Date and (b) was granted less than three years prior
to the expiration date of the Offer period (other than in the
limited case where no three year non-exercisability period
applied to such option), Crown will offer the holder a cash
indemnity in exchange for the termination of the holder's rights
under such option, which cash indemnity shall be in an amount
equal to the difference between the Cash Election Price and the
exercise price of the applicable option; provided that the cash
indemnity will in no event exceed the amount specified above and
no payment shall be made for taxes, social contributions or other
costs; and
(ii) For each Outstanding Option that (a) is outstanding on the
Commencement Date, (b) is held by a person who is a French tax
resident as of the Commencement Date and (c) was granted at least
three years but less than five years prior to the expiration date
of the Offer period (or granted less than five years prior to the
expiration date of the Offer period in the limited case where no
three year non-exercisability period applied to such option),
Crown will offer the holder the right to "put" the shares of
Common Stock received upon exercise of such Outstanding Option in
accordance with its terms to Crown, free and clear of any lien or
other encumbrance, at a price per share of Common Stock so
received equal to the Cash Election Price plus interest
calculated at a rate equal to 6% per annum (subject to adjustment
as described below) calculated from and including the expiration
date of the Offer period until but excluding the date the
3
shares of Common Stock received upon exercise of the applicable
option are purchased by Crown. The interest rate described above
shall be automatically increased by 1% or decreased by 1%, as
appropriate, from time to time by 1% at any one time whenever the
difference between the then current interest rate hereunder and
the then current six-month LIBOR rate is 1%. The put right may be
exercised only with respect to the number of shares of Common
Stock which the holder would be entitled to receive upon exercise
of the options as of the Commencement Date, and no adjustment
shall be given effect following the Commencement Date with
respect to any anti-dilution provisions of the plans under which
the applicable options were granted. The foregoing put right will
terminate with respect to a share of Common Stock received upon
exercise of an Outstanding Option 90 days following the earlier
of the date of exercise of such Outstanding Option after the
Commencement Date and the fifth anniversary of the date of grant
of the applicable option.
Subject to compliance with the foregoing, nothing herein shall limit
Crown's ability to restrict or terminate any Outstanding Options to
the extent agreed between Crown and the holder of such Outstanding
Options or any other Outstanding Options.
Except as specifically amended hereby, the remaining provisions of the
Exchange Offer Agreement shall remain in full force and effect.
4
Please indicate your agreement with the foregoing by signing the enclosed
copy of this letter in the space indicated below and returning such copy to the
undersigned.
Sincerely,
CROWN CORK & SEAL COMPANY, INC.
By: /s/ X.X. Xxxxxxxxxx
-------------------------------
Accepted and Agreed:
COMPAGNIE GENERALE D'INDUSTRIE ET
DE PARTICIPATIONS
By: /s/ Xxxxxx-Xxxxxxx Selliere
-------------------------------
Date: December 28, 1995
