AGREEMENT AND
PLAN OF MERGER
by and among
GLDD ACQUISITIONS CORP.,
ALDABRA ACQUISITION CORPORATION,
ALDABRA MERGER SUB, L.L.C.
THE COMPANY REPRESENTATIVE NAMED HEREIN,
and
THE BUYER REPRESENTATIVE NAMED HEREIN
June 20,
2006
TABLE OF CONTENTS
ARTICLE 1
|
|
THE MERGER
|
|
2
|
1A.
|
|
The Merger
|
|
2
|
1B.
|
|
Consummation of the Merger
|
|
2
|
1C.
|
|
Effect of the Merger
|
|
2
|
1D.
|
|
Further Assurances
|
|
2
|
|
|
|
|
|
ARTICLE 2
|
|
THE SURVIVING COMPANY
|
|
3
|
2A.
|
|
Certificate of Incorporation
|
|
3
|
2B.
|
|
By-Laws
|
|
3
|
2C.
|
|
Directors
|
|
3
|
2D.
|
|
Officers
|
|
3
|
|
|
|
|
|
ARTICLE 3
|
|
CONVERSION OF SHARES
|
|
3
|
3A.
|
|
Conversion of Shares
|
|
3
|
3B.
|
|
Appraisal Rights
|
|
5
|
|
|
|
|
|
ARTICLE 4
|
|
CLOSING; PAYMENT OF MERGER CONSIDERATION
|
|
5
|
4A.
|
|
Closing
|
|
5
|
4B.
|
|
Closing Distributions
|
|
6
|
4C.
|
|
Closing of Company Transfer Books
|
|
6
|
4D.
|
|
Merger Consideration Adjustment
|
|
6
|
4E.
|
|
Fractional Shares.
|
|
10
|
|
|
|
|
|
ARTICLE 5
|
|
CONDITIONS TO CLOSING
|
|
11
|
5A.
|
|
Conditions to All Parties Obligations
|
|
11
|
5B.
|
|
Conditions to Buyers and Merger Subs Obligations
|
|
12
|
5C.
|
|
Conditions to the Companys Obligations
|
|
14
|
5D.
|
|
Waiver of Condition
|
|
15
|
|
|
|
|
|
ARTICLE 6
|
|
CERTAIN COVENANTS PRIOR TO THE EFFECTIVE TIME
|
|
16
|
|
|
|
|
|
6A.
|
|
Access
|
|
16
|
6B.
|
|
Ordinary Conduct of Company
|
|
16
|
6C.
|
|
Exclusive Transaction
|
|
18
|
6D.
|
|
Joint Prospectus/Proxy Statement; Buyer Shareholder
Approval
|
|
18
|
6E.
|
|
Tax Treatment
|
|
20
|
6F.
|
|
Ordinary Conduct of Buyer
|
|
21
|
|
|
|
|
|
ARTICLE 7
|
|
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
|
|
23
|
7A.
|
|
Organization and Corporate Power
|
|
23
|
7B.
|
|
Company Capital Stock
|
|
23
|
7C.
|
|
Subsidiaries
|
|
23
|
7D.
|
|
Authorization; No Breach
|
|
24
|
7E.
|
|
Company SEC Reports; Financial Statements
|
|
24
|
7F.
|
|
Absence of Certain Developments
|
|
26
|
7G.
|
|
Real Property
|
|
27
|
|
|
|
|
|
i
7H.
|
|
Tax Matters
|
|
27
|
7I.
|
|
Company Material
Contracts
|
|
28
|
7J.
|
|
Intellectual Property
|
|
28
|
7K.
|
|
Legal Proceedings
|
|
29
|
7L.
|
|
Brokerage
|
|
29
|
7M.
|
|
Company Employee
Benefit Plans
|
|
29
|
7N.
|
|
Insurance
|
|
31
|
7O.
|
|
Permits; Compliance
with Applicable Laws
|
|
31
|
7P.
|
|
Environmental
|
|
32
|
7Q.
|
|
Labor Matters
|
|
32
|
|
|
|
|
|
ARTICLE 8
|
|
REPRESENTATIONS,
WARRANTIES AND COVENANTS OF BUYER AND MERGER SUB
|
|
33
|
8A.
|
|
Organization and
Corporate Power
|
|
33
|
8B.
|
|
Buyer Capital Stock
|
|
33
|
8C.
|
|
Buyer Equity Interests
|
|
34
|
8D.
|
|
Authorization; No
Breach
|
|
34
|
8E.
|
|
Legal Proceedings
|
|
35
|
8F.
|
|
Board Approvals
|
|
35
|
8G.
|
|
SEC Filings; Financial
Statements
|
|
35
|
8H.
|
|
No Undisclosed
Liabilities
|
|
36
|
8I.
|
|
Trust Fund
|
|
36
|
8J.
|
|
Brokerage
|
|
36
|
8K.
|
|
Absence of Certain Developments
|
|
36
|
8L.
|
|
Buyer D&O Policy
|
|
37
|
8M.
|
|
Compliance with
Applicable Laws
|
|
37
|
8N.
|
|
Buyer Material
Contracts
|
|
37
|
|
|
|
|
|
ARTICLE 9
|
|
TERMINATION
|
|
38
|
9A.
|
|
Termination
|
|
38
|
9B.
|
|
Effect of Termination
|
|
39
|
9C.
|
|
Limitation on Remedy
|
|
39
|
|
|
|
|
|
ARTICLE 10
|
|
DEFINITIONS
|
|
39
|
ARTICLE 11
|
|
ADDITIONAL AGREEMENTS
|
|
53
|
11A.
|
|
Survival
|
|
53
|
11B.
|
|
Press Release and
Announcements
|
|
53
|
11C.
|
|
Confidentiality
|
|
53
|
11D.
|
|
Written Consents
|
|
53
|
11E.
|
|
Notification
|
|
54
|
11F.
|
|
Consents
|
|
54
|
11G.
|
|
Reasonable Best Efforts
|
|
54
|
11H.
|
|
Regulatory Act
Compliance
|
|
54
|
11I.
|
|
Director and Officer
Liability and Indemnification
|
|
55
|
11J.
|
|
Designation and
Replacement of Representatives
|
|
55
|
|
|
|
|
|
|
|
|
|
|
ii
11K.
|
|
Authority and Rights of
Representatives; Limitations on Liability
|
|
56
|
11L.
|
|
Provision Respecting
Representation of Company
|
|
57
|
11M.
|
|
Expenses; Transfer
Taxes
|
|
58
|
11N.
|
|
Post-Closing Mergers
and Transactions
|
|
58
|
11O.
|
|
Conversion Rights
|
|
60
|
|
|
|
|
|
ARTICLE 12
|
|
MISCELLANEOUS
|
|
60
|
12A.
|
|
Amendment and Waiver
|
|
60
|
12B.
|
|
Notices
|
|
61
|
12C.
|
|
Assignment
|
|
62
|
12D.
|
|
Severability
|
|
62
|
12E.
|
|
No Strict Construction
|
|
63
|
12F.
|
|
Captions
|
|
63
|
12G.
|
|
Complete Agreement
|
|
63
|
12H.
|
|
Company Disclosure
Letter
|
|
63
|
12I.
|
|
No Additional
Representations; Disclaimer
|
|
64
|
12J.
|
|
Counterparts
|
|
65
|
12K.
|
|
Governing Law
|
|
65
|
12L.
|
|
CONSENT TO JURISDICTION
|
|
65
|
12M.
|
|
Interpretation
|
|
65
|
12N.
|
|
Third-Party
Beneficiaries and Obligations
|
|
65
|
12O.
|
|
Specific Performance
|
|
66
|
|
|
|
|
|
LIST
OF EXHIBITS
|
|
|
|
|
|
Exhibit A
|
|
Voting Agreement
|
|
|
Exhibit B
|
|
Certificate of Merger
|
|
|
Exhibit C
|
|
Adjustment Escrow
Agreement
|
|
|
Exhibit D
|
|
Company Closing
Certificate
|
|
|
Exhibit E
|
|
Buyer Closing
Certificate
|
|
|
Exhibit F
|
|
Investor Rights
Agreement
|
|
|
Exhibit G
|
|
Holdco Certificate of
Incorporation
|
|
|
Exhibit H
|
|
Holdco Bylaws
|
|
|
iii
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (this
Agreement
)
is made as of June 20, 2006, by and among GLDD Acquisitions Corp., a
Delaware corporation (the
Company
), Aldabra Acquisition Corporation, a
Delaware corporation (the
Buyer
), Aldabra Merger Sub, L.L.C., a
Delaware limited liability company (
Merger Sub
), Madison Dearborn
Capital Partners IV, L.P., a Delaware limited partnership, solely in its
capacity as representative as set forth in this Agreement (the
Company
Representative
) and Terrapin Partners LLC, solely in its capacity as
representative as set forth in this Agreement (
Buyer Representative
).
WHEREAS, the boards of directors of the Company and
Buyer, and Buyer in its capacity as sole equityholder of Merger Sub, have
approved the merger of the Company with and into Merger Sub (the
Merger
)
upon the terms and conditions set forth in this Agreement and in accordance
with the Delaware General Corporation Law (the
Delaware Corporation Law
)
and the Delaware Limited Liability Company Act (the
Delaware LLC Act
),
have declared that it is advisable that this Agreement be adopted by the
stockholders of the Company and Buyer and have agreed to submit the Merger to
the respective stockholders of the Company and Buyer for approval. Merger Sub
and the Company are hereinafter sometimes referred to collectively as the
Constituent
Companies
.
WHEREAS, the authorized capital stock of the Company
consists of (i) 1,500,000 shares of Common Stock, par value $0.01 per
share (the
Company Common Stock
), (ii) 90,000 shares of Series A
Preferred Stock, par value $0.01 per share (the
Series A Preferred
Stock
) and (iii) 10,000 shares of Series B Preferred Stock, par
value $0.01 per share (the
Series B Preferred Stock
and together
with the Series A Preferred Stock, the
Company Preferred Stock
). The
Company Preferred Stock and the Company Common Stock are collectively referred
to herein as the
Company Capital Stock
.
WHEREAS, the authorized capital stock of the Buyer
consists of (i) 35,000,000 shares of Buyer Common Stock, and (ii) 1,000,000
shares of Buyer Preferred Stock.
WHEREAS, the authorized limited liability company
interests of Merger Sub consist of 1,000 Merger Sub Common Units.
WHEREAS, for United States federal income tax purposes
it is intended that (i) the Merger and the Post-Closing Mergers will be
treated for federal income tax purposes as reorganizations within the meaning
of Section 368 of the Code (or, in the case of the GLDD Merger, such
merger may be treated as a liquidation of GLDD within the meaning of Section 332
of the Code), (ii) this Agreement shall be, and hereby is, adopted as a plan
of reorganization for purposes of Sections 354 and 361 of the Code; and (iii) with
respect to the Merger, Buyer and the Company will each be a party to a
reorganization within the meaning of Section 368 of the Code and, with
respect to the Post-Closing Mergers, Buyer, Holdco and GLDD will each be a
party to a reorganization within the meaning of Section 368 of the Code
(or, in the event that the GLDD Merger is being treated as a liquidation of
GLDD within the meaning of Section 332 of the Code, then only Buyer will
be a party to a reorganization within the meaning of Section 368 of the
Code).
WHEREAS, it is a condition to the obligations of Buyer
to close the transactions contemplated by this Agreement that, within two
business days after the date of this Agreement, the Company Representative
enters into a Voting Agreement in substantially the form of
Exhibit A
attached hereto (the
Voting Agreement
) agreeing to vote its shares of
Company Capital Stock in favor of the Merger and waiving certain rights it has
in its capacity as a holder of Company Preferred Stock.
NOW, THEREFORE, in consideration of the premises and
the mutual representations, warranties and covenants herein contained, and
intending to be legally bound, the parties hereto hereby agree as follows:
ARTICLE 1
THE MERGER
1A.
The
Merger
. On and subject to the terms and conditions contained herein, at the
Effective Time (as defined in
Section 1B
), the Company shall be
merged with and into Merger Sub, with Merger Sub being the surviving company in
the Merger (Merger Sub, as the surviving company after the Merger, is referred
to as the
Surviving Company
).
1B.
Consummation
of the Merger
. On the Closing Date, subject to satisfaction or waiver of
the conditions specified in
Article 5
hereof, the parties hereto
shall cause a certificate of merger in the form of
Exhibit B
attached hereto (the
Certificate of Merger
) to be executed in
accordance with the relevant provisions of the Delaware LLC Act and the
Delaware Corporation Law and to be filed with the Secretary of State of the
State of Delaware, and the Merger shall be effective at such time as the
Certificate of Merger is duly filed with the Secretary of State for the State
of Delaware (the
Effective Time
).
1C.
Effect
of the Merger
. The Merger shall have the effects provided in the Delaware
LLC Act and the Delaware Corporation Law, and upon the effectiveness of the
Merger, (i) the separate existence of the Company shall cease (except as
may be continued by operation of law), (ii) Merger Sub shall be the
surviving company in the Merger, (iii) the Surviving Company shall possess
all of the rights, privileges, powers and franchises of each of the Constituent
Companies, and all property (real, personal and mixed) and all debts due to any
of the Constituent Companies in whatever amount, as well as all other things in
action or belonging to each of the Constituent Companies, shall be vested in
the Surviving Company, (iv) all property, rights, privileges, powers and
franchises and all and every other interest shall be thereafter as effectively
the property of the Surviving Company as they were of the Constituent
Companies, and the title to any real estate vested by deed or otherwise in any
of the Constituent Companies shall not revert or be in any way impaired by
reason of the Merger, and (v) all rights of creditors and all liens upon
any property of any of the Constituent Companies shall be preserved unimpaired,
and all debts, liabilities and duties of the Constituent Companies shall
henceforth attach to the Surviving Company and may be enforced against it to
the same extent as if such debts, liabilities and duties had been incurred or
contracted by it and the Surviving Company shall timely pay such debts,
liabilities and duties.
1D.
Further
Assurances
. If, at any time after the Effective Time, the Surviving Company
shall consider or be advised that any further deeds, assignments or assurances
in law or
2
any other acts are necessary, desirable or proper to
vest, perfect or confirm, of record or otherwise, in the Surviving Company the
title to any property or right of the Constituent Companies acquired or to be
acquired by reason of, or as a result of, the Merger or to otherwise carry out
the purposes of this Agreement or effect the Merger, the Surviving Company and
its officers and directors shall execute and deliver all such property, deeds,
assignments and assurances in law and do all acts necessary, desirable or
proper to vest, perfect or confirm title to such property or right in the
Surviving Company, and the officers and directors of the Constituent Companies
and the officers and directors of the Surviving Company are fully authorized in
the name of the Constituent Companies or otherwise to take any and all such
action solely for the purposes set forth in this
Section 1D
.
ARTICLE 2
THE SURVIVING COMPANY
2A.
Certificate
of Formation
. The Certificate of Formation of Merger Sub, as in
effect at the Effective Time, shall be the Certificate of Formation of the
Surviving Company until amended or repealed in accordance with the provisions
thereof and applicable law.
2B.
Limited
Liability Company Agreement
. The limited liability company agreement
of Merger Sub, as in effect at the Effective Time, shall be the limited
liability company agreement of the Surviving Company until amended or repealed
in accordance with the provisions thereof and applicable law.
2C.
Managers
. The
directors of the Company, as of the Effective Time, shall be the directors of
the Surviving Company until their respective successors are duly elected and
qualified in the manner provided in the limited liability company agreement of
the Surviving Company or until their earlier resignation or removal or as
otherwise provided by applicable law.
2D.
Officers
. The
officers of the Company, as of the Effective Time, shall be the officers of the
Surviving Company until their successors are duly elected and qualified in the
manner provided in the limited liability company agreement of the Surviving
Company or until their earlier resignation or removal or as otherwise provided
by applicable law.
ARTICLE 3
CONVERSION OF SHARES
3A.
Conversion
of Shares
. At the Effective Time, by virtue of the Merger and without
any action on the part of Buyer, Merger Sub, the Company or the holders of any
of the following securities:
(i) Each Merger Sub
Common Unit issued and outstanding immediately prior to the Effective Time
shall remain outstanding as one validly issued common unit of the Surviving
Company (each, a
Surviving Company Common Unit
).
(ii) Except as otherwise
provided herein, each share of Company Preferred Stock issued and outstanding
immediately prior to the Effective Time (other than shares of Company Preferred
Stock cancelled pursuant to
Section 3A(iv)
and other than
Dissenting Shares) shall be converted into the right to receive, upon delivery
of a duly
3
executed and completed Letter of Transmittal and surrender of a
Certificate formerly representing such share in the manner provided in
Section 4B
,
the Preferred Per Share Merger Consideration, and such share of Company
Preferred Stock after such conversion shall automatically be cancelled and
retired and shall cease to exist. Prior to Closing, the Company shall provide
Buyer and Merger Sub with a certificate (the
Preferred Allocation
Certificate
) setting forth the Company Preferred Stock Merger
Consideration for each holder of Company Preferred Stock (other than holders of
Dissenting Shares), the aggregate portion of the Company Preferred Stock Merger
Consideration to which each such holder is entitled for all shares of Company
Preferred Stock held by such holder, and Buyer and the Surviving Company shall
have no liability to any holder of Company Capital Stock for relying on, or
paying the Company Preferred Stock Merger Consideration in accordance with,
such Preferred Allocation Certificate.
(iii) Each share of
Company Common Stock issued and outstanding immediately prior to the Effective
Time (other than other shares of Company Common Stock canceled pursuant to
Section 3A(iv)
and
other than Dissenting Shares) shall be converted into the right to receive,
upon delivery of a duly executed and completed Letter of Transmittal and
surrender of a Certificate formerly representing such share in the manner
provided in
Section 4B
, the Closing Common Per Share Merger
Consideration and the Additional Per Share Merger Consideration, and such share
of Company Common Stock after such conversion shall automatically be cancelled
and retired and shall cease to exist.
(iv) Each share of
Company Capital Stock held in the treasury of the Company and each share of
Company Capital Stock owned or held, directly or indirectly, by the Company or
its wholly-owned Subsidiaries or Buyer, in each case immediately prior to the
Effective Time, shall be cancelled and retired and shall cease to exist without
any conversion thereof and no payment of cash or any other consideration or distribution
shall be made with respect thereto.
(v) As of the Effective
Time, all shares of Company Capital Stock issued and outstanding immediately
prior to the Effective Time (other than other shares to be canceled as provided
in
Section 3A(iv)
) shall no longer be outstanding and shall
automatically be cancelled and retired and shall cease to exist, and each
holder of a Certificate (other than a certificate representing Dissenting
Shares) shall, to the extent such Certificate represents such shares, cease to
have any rights with respect thereto, except the right to receive, upon the
terms and subject to the conditions hereof, a portion of the Closing Common
Stock Merger Consideration or the Company Preferred Stock Merger Consideration,
as applicable, and, in the case of each share of Company Common Stock, a
portion of the Additional Merger Consideration. Surrendered Certificates shall
forthwith be cancelled by the Surviving Company.
(vi) The Surviving
Company shall not be liable to any Person in respect of amounts properly paid
to a public official pursuant to any applicable abandoned property, escheat or
similar law.
4
3B.
Appraisal
Rights
. Each issued and outstanding share of Company Capital Stock
that is held by a Person who has not voted in favor of the Merger or consented
thereto in writing or executed an enforceable waiver of appraisal rights to the
extent permitted by applicable law and, in the case of any Person required to
have exercised appraisal rights under Section 262 of Delaware Corporation
Law as of the Effective Time of the Merger in order to preserve such rights,
with respect to which appraisal rights under the Delaware Corporation Law have
been properly exercised, shall not be converted into the right to receive any
portion of the Preferred Stock Merger Consideration, the Closing Common Stock
Merger Consideration or the Additional Merger Consideration, as the case may
be, and shall be converted into the right to receive payment from the Surviving
Company with respect thereto as provided by the Delaware Corporation Law,
unless and until the holder of any such share shall have failed to perfect or
shall have effectively withdrawn or lost his, her or its right to appraisal and
payment under the Delaware Corporation Law, in which case such share shall
thereupon be deemed, as of the Effective Time, to have been cancelled and
retired and to have ceased to exist and been converted into the right to
receive a portion, without interest, in accordance with this Agreement, of (i) in
the case of holders of Preferred Stock, the Preferred Stock Merger
Consideration and (ii) in the case of holders of Company Common Stock, the
Closing Common Stock Merger Consideration and the Additional Merger
Consideration. From and after the Effective Time, no stockholder shall be
entitled to vote his, her or its shares of Company Capital Stock for any
purpose or to receive payment of dividends or other distributions on his, her
or its shares (except dividends or other distributions payable to stockholders
of record at a date prior to the Effective Time, or dividends that accrued
thereon prior to the Effective Time, but only to the extent included in the
Preferred Stock Merger Consideration). Any shares of Company Capital Stock for
which appraisal rights have been properly exercised, and not subsequently
withdrawn, lost or failed to be perfected, are referred to herein as
Dissenting
Shares
.
ARTICLE 4
CLOSING; PAYMENT OF MERGER CONSIDERATION
4A.
Closing
. On
the terms and subject to the conditions set forth in this Agreement, the closing
of the Merger and the transactions contemplated by this Agreement (the
Closing
)
shall take place immediately prior to the Effective Time at the offices of
Kirkland & Ellis LLP, 200 E. Randolph Dr., Chicago, IL 60601 at 10:00 a.m.
local time, on the second business day following the satisfaction or waiver of
the conditions set forth in
Article 5
hereof (other than conditions
which by their terms are to be or can be performed at the Closing;
provided
that such conditions are satisfied at the Closing). The date on which the
Closing shall occur is referred to herein as the
Closing Date
. On the business day immediately preceding the
Closing Date, Buyer and the Company shall conduct a pre-Closing at the same
location as the Closing, commencing at 10:00 a.m. local time, at which
each party shall present for review by the other parties copies in execution
form of all documents required to be delivered by such party at the Closing. At
the Closing, Buyer and Merger Sub shall deliver to the Company all of the
certificates, instruments and documents required to be delivered under
Section 5C
,
and the Company shall deliver to Buyer and Merger Sub all of the certificates,
instruments and documents required to be delivered under
Section 5B
.
5
4B.
Closing
Distributions
.
(i) At the Effective Time, the Buyer
shall issue to the holders of Company Capital Stock a number of shares of Buyer
Common Stock equal to the Closing Merger Consideration to be distributed or
delivered as set forth in clauses (ii) and (iii) of this
Section 4B
.
(ii) At or after the Effective Time, upon
the proper surrender and exchange of Certificates and delivery of a duly
executed and completed letter of transmittal in customary form to be mutually
agreed upon between Buyer and the Company (the
Letter of Transmittal
)
to the Buyer, the Buyer shall distribute to (a) each holder of Company
Preferred Stock the portion of the Company Preferred Stock Merger Consideration
to which such holder is entitled and (b) each holder of Company Common
Stock the portion of the Closing Common Stock Merger Consideration to which
such holder is entitled, in each case as determined in accordance with
Section 3A
.
Furthermore, upon surrender and exchange of Certificates and delivery of the
Letter of Transmittal to the Buyer, each holder of Company Common Stock shall
be irrevocably entitled to receive the portion of the Additional Merger
Consideration to which such holder is entitled, to be paid to such holder as
set forth in this Agreement. Notwithstanding anything contained in this
Section 4B
to the contrary, the provisions of this
Section 4B(ii)
shall
not be applicable to Dissenting Shares.
(iii) At the Effective Time, Buyer shall
deliver the Adjustment Escrow Shares to the Escrow Agent for deposit into a
separate escrow account (the
Adjustment Escrow Account
) established
pursuant to the terms of an escrow agreement in the form of
Exhibit C
attached hereto (the
Adjustment Escrow Agreement
) among Buyer, Holdco,
the Company Representative, the Buyer Representative and the Escrow Agent. The
Adjustment Escrow Shares shall be maintained separately in the Adjustment
Escrow Account, and such Adjustment Escrow Shares shall be Buyers sole and
exclusive source of recovery for any amounts owing to Buyer pursuant to this
Agreement as set forth herein.
(iv) The applicable portion of the Merger
Consideration payable to a holder of Company Capital Stock shall be made by
delivery of certificates for shares of Buyer Common Stock representing such
portion of the Merger Consideration unless alternative arrangements are
specified by such holder in the Letter of Transmittal.
4C.
Closing of Company
Transfer Books
. At the Effective Time, the stock transfer books of the
Company shall be closed, and no transfer of the Company Capital Stock shall be
made thereafter. If, after the Effective Time, valid Certificates are presented
to the Surviving Company in accordance with
Section 4B
, such
Certificates and instruments shall be cancelled and exchanged for the
consideration provided in
Section 4B
.
4D.
Merger
Consideration Adjustment
.
(i) Within 90 days following the Closing
Date, the Surviving Company (or, in the event that the Post-Closing Mergers
have occurred prior to such date, Holdco) shall
6
prepare and
deliver to the Company Representative and the Buyer Representative (a) an
unaudited consolidated balance sheet of the Company and its Subsidiaries as of
11:59 p.m. (Chicago, Illinois time) on the day before the Closing (the
Company
Closing Balance Sheet
), (b) an unaudited consolidated balance sheet of
Buyer and its Subsidiaries as of 11:59 p.m. (Chicago, Illinois time) on
the day before the Closing (the
Buyer Closing Balance Sheet
) and (c) a
statement (the
Closing Statement
) setting forth the Surviving Companys
(or, as applicable, Holdcos) calculation of Company Closing Net Working
Capital, Company Closing Net Indebtedness and Buyer Closing Net Working Capital.
During the 90 day period following the Closing Date, the Buyer Representative
shall provide the Surviving Company (or, as applicable, Holdco) with reasonable
assistance, as the Surviving Company may reasonably request, in the preparation
of the Buyer Closing Balance Sheet and the calculation of Buyer Closing Net
Working Capital. The Company Closing Balance Sheet shall be prepared on a consolidated
basis for the Company and its Subsidiaries in accordance with GAAP applied on a
basis consistent with the methodologies, practices, estimation techniques,
assumptions and principles used in the preparation of the financial statements
included in the Company SEC Reports related to the fiscal quarter ended March 31,
2006 and the Buyer Closing Balance Sheet shall be prepared on a consolidated
basis for Buyer and its Subsidiaries in accordance with GAAP applied on a basis
consistent with the methodologies, practices, estimation techniques,
assumptions and principles used in the preparation of the financial statements
included in the Buyer SEC Reports related to the fiscal quarter ended March 31,
2006;
provided
that, notwithstanding the foregoing or anything else
herein to the contrary (including the definition of Buyer Net Working Capital
and Company Net Working Capital), in the event that the day before the Closing
Date is a date other than the last calendar day of a month, the Surviving
Company (or, as applicable, Holdco) may, in the calculation of Buyer Closing
Net Working Capital and Company Closing Net Working Capital, use any
roll-forward from the most recent calendar month end prior to the Closing Date
or similar technique as it deems reasonably necessary to calculate any
component thereof. During the 20 days immediately following the Company
Representatives and Buyer Representatives receipt of the Company Closing
Balance Sheet, Buyer Closing Balance Sheet and the Closing Statement, subject
to execution and delivery by the Surviving Company (or, as applicable, Holdco)
of a customary hold harmless letter in favor of the Person(s) preparing
such work papers, the Company Representative and Buyer Representative shall be
permitted to review such working papers relating to the Company Closing Balance
Sheet, Buyer Closing Balance Sheet and the Closing Statement. The Company
Closing Balance Sheet, Buyer Closing Balance Sheet and the Closing Statement
shall become final and binding upon the parties 20 days following the Buyer
Representatives receipt thereof unless the Company Representative or Buyer
Representative gives written notice of its disagreement (each a
Notice of
Disagreement
) to the other prior to such date. Any Notice of Disagreement
shall (x) specify in reasonable detail the nature and amount of any
disagreement so asserted, and (y) only include disagreements based on
mathematical errors or based on the Company Closing Balance Sheet, Buyer
Closing Balance or Closing Statement not being prepared in accordance with this
Agreement.
(ii) If a timely Notice of Disagreement is
received by the Company Representative or the Buyer Representative, as
applicable, then the Company Closing
7
Balance Sheet,
the Buyer Closing Balance Sheet and the Closing Statement (as revised in
accordance with clause (a) or (b) below) shall become final and
binding upon the parties on the earlier of (a) the date the Company
Representative and Buyer Representative resolve in writing any and all
differences they have with respect to any matter specified in any Notice of
Disagreement and (b) the date any matters properly in dispute are finally
resolved in writing by the Accounting Firm. During the 30 days immediately
following the delivery of a Notice of Disagreement, the Company Representative
and Buyer Representative shall seek in good faith to resolve in writing any
differences which they may have with respect to any matter specified in any
Notice of Disagreement, and all such discussions related thereto shall (unless
otherwise agreed by Buyer Representative and the Company Representative) be
governed by Rule 408 of the Federal Rules of Evidence and any
applicable similar state rule. At the end of such 30-day period, the
Company Representative and Buyer Representative shall submit to an accounting
firm mutually agreed upon by the Company Representative and Buyer
Representative (the
Accounting Firm
) for review and resolution of any
and all matters (but only such matters) which remain in dispute and which were
properly included in any Notice of Disagreement. Buyer Representative and the
Company Representative shall instruct the Accounting Firm to make a final
determination of the items included in the Company Closing Balance Sheet, the
Buyer Closing Balance Sheet and the Closing Statement (to the extent such
amounts are in dispute) in accordance with the guidelines and procedures set
forth in this Agreement. Buyer Representative and the Company Representative
will cooperate with the Accounting Firm during the term of its engagement. Buyer
Representative and the Company Representative shall instruct the Accounting
Firm not to, and the Accounting Firm shall not, assign a value to any item in
dispute greater than the greatest value for such item assigned by Buyer
Representative, on the one hand, or the Company Representative, on the other
hand, or less than the smallest value for such item assigned by Buyer
Representative, on the one hand, or the Company Representative, on the other
hand. Buyer Representative and the Company Representative shall also instruct
the Accounting Firm to, and the Accounting Firm shall, make its determination
based solely on presentations by Buyer Representative and the Company
Representative which are in accordance with the guidelines and procedures set
forth in this Agreement (i.e., not on the basis of an independent review). The
Company Closing Balance Sheet, the Buyer Closing Balance Sheet, the Closing
Statement and the resulting Company Closing Net Working Capital, Closing Net
Indebtedness and Buyer Closing Net Working Capital shall become final and
binding on the parties hereto on the date the Accounting Firm delivers its
final resolution in writing to Buyer Representative and the Company
Representative (which final resolution shall be requested by the parties to be
delivered not more than 45 days following submission of such disputed matters),
and such resolution by the Accounting Firm shall not be appealable. The fees
and expenses of the Accounting Firm pursuant to this
Section 4D(ii)
shall
be borne by the Surviving Company (or, as applicable, Holdco).
(iii) If the Incremental Closing Merger
Consideration is less than the Incremental Merger Consideration (such
shortfall, the
Adjustment Amount
), (a) the Buyer Representative
and the Company Representative shall as a portion of the Additional Merger
Consideration, within five (5) business days after the Closing Statement
becomes final and binding on the parties, deliver joint written instructions to
8
the Escrow
Agent to cause the Escrow Agent to deliver the Adjustment Escrow Shares from
the Adjustment Escrow Account to the holders of Company Common Stock (other
than Dissenting Shares) as of immediately prior to the Effective Time and (b) Buyer
(or, if the Holdco Merger has occurred, Holdco) shall issue to the holders of
Company Common Stock (other than Dissenting Shares) as of immediately prior to
the Effective Time a number of shares (the
Additional Shares
) equal to
the Adjustment Amount, in each case with each such holder entitled to receive
the Additional Per Share Merger Consideration payable for each share of Company
Common Stock held by such holder immediately prior to the Effective Time.
(iv) If the Incremental Closing Merger
Consideration is greater than the Incremental Merger Consideration (such excess,
the
Excess Amount
), the Buyer Representative and the Company
Representative shall deliver joint written instructions to the Escrow Agent to
cause the Escrow Agent, within five (5) business days after the Closing
Statement becomes final and binding on the parties, to deliver to the Buyer
(or, if the Holdco Merger has occurred, Holdco) for cancellation certificates
for a number of shares of Buyer Common Stock (the
Give-Back Shares
)
equal to the Excess Amount and if the Give-Back Shares are less than the
Adjustment Escrow Shares, to deliver the remaining Adjustment Escrow Shares to
holders of Company Common Stock (other than Dissenting Shares) as of
immediately prior to the Effective Time, with each such holder entitled to
receive the Additional Per Share Merger Consideration payable for each share of
Company Common Stock held by such holder immediately prior to the Effective
Time.
(v) Buyer agrees that delivery of the
Give-Back Shares from the Adjustment Escrow Account in accordance with the
Adjustment Escrow Agreement shall be the sole and exclusive remedy for Buyer,
the Surviving Company and Buyer Representative for payment of the Excess Amount
(if any) and that the working capital adjustment and indebtedness adjustment
provided for in this
Section 4D
, and the dispute resolution
provisions provided for in this
Section 4D
, shall be the exclusive
remedies for the matters addressed or that could be addressed therein;
provided
that, for the avoidance of doubt, and without limiting the generality of the
foregoing, no claim by Buyer Representative for the payment of the Excess
Amount shall be asserted against the holders of Company Capital Stock.
(vi) In the event that the Holdco Merger is
to be consummated immediately after the Effective Time, Holdco may, in lieu of
Buyer, execute and deliver the Adjustment Escrow Agreement in the same capacity
as Buyer and deliver shares of Holdco Common Stock as Adjustment Escrow Shares
(in which case all references in this Agreement to Adjustment Escrow Shares
being shares of Buyer Common Stock shall instead be an identical number of
shares of Holdco Common Stock). In the event that the Holdco Merger is
consummated prior to the date the Incremental Merger Consideration is finally
determined, all references in this
Section 4D
to Buyer Common
Stock shall instead be references to Holdco Common Stock and the number of
shares of Buyer Common Stock to be issued or delivered as a result of the
calculation of the Adjustment Amount, the Excess Amount and the Give-Back
Shares shall instead be determined as an identical number of shares of Holdco
Common Stock. In furtherance of the foregoing, in
9
the event that
the Holdco Merger is not to be consummated immediately after the Effective
Time, the Company Representative and the Buyer Representative shall take such
action (including, if deemed reasonably necessary, the creation of a trust of
which the Company Representative serves as trustee that will be deemed the
beneficial owner of the Adjustment Escrow Shares until resolution of the matters
described in this
Section 4D
or the naming of the Escrow Agent (in
its capacity as escrow agent) as the record holder of the Adjustment Escrow
Shares until distribution thereof in accordance with the terms hereof) such
that the shares of Buyer Common Stock in the Adjustment Escrow Account are
replaced with an identical number of shares of Holdco Common Stock (it being
understood and agreed that, for all purposes of the Holdco Merger, the shares
of Buyer Common Stock shall be deemed issued and outstanding) and the
certificate representing the shares of Buyer Common Stock that are Adjustment
Escrow Shares is cancelled and a certificate representing the shares of Holdco
Common Stock that are Adjustment Escrow Shares is deposited in the Adjustment
Escrow Account.
4E.
Fractional Shares
.
(i) No certificates representing less
than one share of Buyer Common Stock shall be issued upon the surrender for
exchange of certificates representing Company Capital Stock pursuant to
Article 4
hereof, and such fractional share interest will not entitle the owner thereof
to vote or to any rights of a stockholder of the Buyer.
(ii) As promptly as practicable following
the Effective Time, the Buyer shall determine the excess of (x) the number
of full shares of Buyer Common Stock issued by the Buyer pursuant to
Section 4B(i)
over
(y) the aggregate number of full shares of the Buyer to be distributed or
delivered pursuant to
Section 4B(ii)
and
Section 4B(iii)
(such
excess being herein called the
Closing Excess Shares
). As soon after
the Effective Time as practicable, the Buyer, as agent for the holders of
Company Capital Stock, shall sell the Closing Excess Shares at then prevailing
prices on the exchange or electronic market on which such Closing Excess Shares
are traded, all in the manner provided in
Section 4E(iv)
.
(iii) As promptly as practicable following
the determination of the Additional Merger Consideration, the Buyer shall
determine the excess of (x) the number of full shares of Buyer Common
Stock equal to such Additional Merger Consideration over (y) the aggregate
number of full shares of the Buyer to be distributed to holders of Company
Capital Stock pursuant to
Section 4D(iii)
or
Section 4D(iv)
(such
excess being herein called the
Adjustment Excess Shares
). As soon after
the determination of the Additional Merger Consideration as practicable, the
Buyer, as agent for the holders of Company Capital Stock, shall sell the
Adjustment Excess Shares at then prevailing prices on the exchange or electronic market on which
such Adjustment Excess Shares are traded, all in the manner provided in
Section 4E(iv)
.
(iv) The sale of the Closing Excess Shares
and Adjustment Excess Shares by the Buyer shall be executed on the exchange or
electronic market on which such shares are traded through one or more member
firms and shall be executed in round lots to the extent practicable. Until the
net proceeds of such sale or sales have been distributed to the
10
holders of
Company Capital Stock, the Buyer will hold such proceeds in trust for the
holders of Company Capital Stock (the
Common Shares Trust
). The Buyer
shall pay all commissions, transfer taxes and other out-of-pocket transaction
costs incurred in connection with such sale of the Closing Excess Shares and
Adjustment Excess Shares. The Buyer shall determine the portion of the Common
Shares Trust to which each holder of Company Capital Stock shall be entitled,
if any, by multiplying the amount of the aggregate net proceeds comprising the
Common Shares Trust by a fraction the numerator of which is the amount of the
fractional share interest to which such holder of Company Capital Stock is
entitled and the denominator of which is the aggregate amount of fractional
share interests to which all holders of Company Capital Stock are entitled.
(v) In the event that the Holdco Merger
is consummated prior to completion of the transactions referred to in this Section 4E,
from and after consummation of the Holdco Merger, references to Buyer in this
Section 4E shall instead be references to Holdco and references to Buyer
Common Stock (included as may be determined through the calculation of Closing
Excess Shares and Adjustment Excess Shares) shall instead be references to Holdco
Common Stock.
ARTICLE 5
CONDITIONS TO CLOSING
5A.
Conditions to All
Parties Obligations
. The obligation of each of the Company, Merger
Sub and Buyer to consummate the Merger is subject to the satisfaction, or
waiver by the parties hereto, of the following conditions as of immediately
prior to the Effective Time:
(i) Any applicable waiting periods under
the HSR Act shall have expired or been terminated (the
HSR Approval
)
and all foreign antitrust or similar approvals required for consummation of the
transactions contemplated hereby shall have been obtained;
(ii) Buyer Shareholder Approval (as
defined in Section 6D) shall have been duly obtained from the stockholders
of Buyer by the requisite vote under the laws of the State of Delaware and the
Buyer Charter Documents, the Buyer Post-Closing Directors shall have been duly
elected in accordance with applicable law and the Buyer Charter Documents, the
Buyer Post-Closing Certificate of Incorporation shall have been duly filed with
the Secretary of State for the State of Delaware and become effective under
the laws of the State of Delaware and
not have been amended, modified or repealed;
(iii) Company Shareholder Approval shall
have been duly obtained from the stockholders of the Company by the requisite
vote under the laws of the State of Delaware and the Company Charter Documents;
(iv) Holders of less than twenty percent
(20%) of the shares of Buyer Common Stock issued in Buyers IPO and outstanding
immediately before the Closing shall have exercised their rights to convert
their shares into a pro rata share of the Trust Fund in accordance with Buyers
Charter Documents;
11
(v) The Company shall have received such
consents, amendments and/or waivers under the Senior Credit Agreement,
Equipment Facility, Underwriting Agreement and agreements entered into in
connection therewith and other material contracts to which it is party as may
be necessary such that neither the Merger nor the Post-Closing Mergers shall
(with or without the passage of time) constitute a breach or a default under
any such arrangement and that there is no impediment to the Holdco Merger
occurring immediately after the Effective Time;
(vi) The Registration Statement shall have
become effective under the Securities Act and shall not be the subject of any
stop order or proceeding by the SEC;
(vii) The Holdco Common Stock will be quoted or
listed for trading on the Nasdaq, there will be no action or proceeding pending
or threatened against Holdco or Buyer to prohibit or terminate the listing of
Holdco Common Stock on the Nasdaq and Nasdaq shall not have required, as
condition to such listing, any material amendment to the Investor Rights
Agreement relative to the terms set forth in
Exhibit F
attached
hereto or the Holdco Certificate of Incorporation relative to the terms set
forth in
Exhibit G
attached hereto;
(viii) No injunction or order of any court or
administrative agency of competent jurisdiction shall be in effect as of the
Closing which restrains or prohibits the consummation of the Merger;
(ix) The Company shall have received an
opinion of maritime counsel reasonably satisfactory to the Company that the
Buyer and its Subsidiaries will, immediately after giving effect to the Merger,
and Holdco and its Subsidiaries will, immediately after giving effect to the
Post-Closing Mergers, meet the citizenship requirements for coastwise trading
and dredging in the navigable waters of the United States and with respect to
such other maritime matters as the Company may reasonably request; and
(x) This Agreement shall not have been
terminated in accordance with
Section 9A
.
5B.
Conditions to
Buyers and Merger Subs Obligations
. The obligation of Buyer and Merger
Sub to consummate the Merger is subject to the satisfaction, or waiver by
Buyer, of each of the following additional conditions as of immediately prior
to the Effective Time:
(i) Each of the representations and
warranties of the Company contained in
Article 7
of this Agreement (a) that
are qualified as to Company Material Adverse Effect shall be true and correct
as of the Closing Date as if made anew as of such date (except to the extent
such representations and warranties expressly relate to an earlier date (in
which case as of such earlier date)), and (b) that are not so qualified
shall be true and correct as of the Closing Date as if made anew as of such
date (except to the extent such representations and warranties expressly relate
to an earlier date (in which case as of such earlier date)), except for
failures of the representations and warranties referred to in this
12
clause (b) to
be true and correct as do not and would not reasonably be expected to have, in
the aggregate, a Company Material Adverse Effect;
(ii) Each of the covenants and agreements
of the Company to be performed as of or prior to the Closing shall have been
performed in all material respects;
(iii) The Company shall have delivered to
Buyer and Merger Sub a certificate in the form of
Exhibit D
attached hereto dated the Closing Date and signed by a senior executive officer
of the Company on behalf of the Company confirming the foregoing matters in
Section 5B(i)
and
5B(ii)
;
(iv) The Company shall have delivered to
Buyer and Merger Sub certified copies of the resolutions or consents of the
Companys board of directors and stockholders approving the Merger;
(v) On or prior to the second business
day after the date hereof, the Company Representative shall have delivered to
Buyer an executed counterpart of the Voting Agreement;
(vi) Buyer shall have received a written
opinion, dated as of the Closing Date, from Sidley Austin LLP or other counsel reasonably
satisfactory to the Buyer to the effect that the Merger and the
Post-Closing Mergers will be treated for federal income tax purposes as reorganizations
within the meaning of Section 368 of the Code (or, in the case of the GLDD
Merger, the opinion may be to the effect that the GLDD Merger will instead be
treated as a liquidation of GLDD within the meaning of Section 332 of the
Code) and, with respect to the Merger, Buyer and the Company will each be a
party to a reorganization within the meaning of Section 368 of the Code
and, with respect to the Post-Closing Mergers, Buyer, Holdco and GLDD will each
be a party to a reorganization within the meaning of Section 368 of the
Code (unless the opinion states that the GLDD Merger is treated as a
liquidation of GLDD within the meaning of Section 332 of the Code, in
which case only the Buyer will be a party to a reorganization within the
meaning of Section 368 of the Code)
. In rendering such opinion,
Sidley Austin LLP or such other
counsel may rely upon representations contained herein and customary
representation letters of the Company and the Buyer.
(vii) The Company Representative and the
Escrow Agent shall have executed and delivered to the Buyer Representative the
Adjustment Escrow Agreement;
(viii) The Company Representative shall have
delivered an executed counterpart to the investor rights agreement
substantially in the form of
Exhibit F
attached hereto (the
Investor
Rights Agreement
) to Buyer, Holdco, and each of the Aldabra Shareholders
(as defined in the Investor Rights Agreement);
(ix) Since December 31, 2005, there
shall not have been a Company Material Adverse Effect; and
(x) The Buyer and Merger Sub shall have
received from the Company prior to the Closing Date hereof a certificate, as
described in Treasury Regulation Section 1.1445-
13
2(c),
affirming that the Company is not a U.S. real property holding company, within
the meaning of Section 897 of the Code.
5C.
Conditions to the
Companys Obligations
. The obligation of the Company to consummate the
Merger is subject to the satisfaction, or waiver by the Company, of each of the
following additional conditions as of immediately prior to the Effective Time:
(i) Each of the representations and
warranties of Buyer and Merger Sub contained in
Article 8
of this
Agreement (a) that are qualified as to material adverse effect or
similar qualifier shall be true and correct as of the Closing Date as if made
anew as of such date (except to the extent such representations and warranties
expressly relate to an earlier date (in which case as of such earlier date)),
and (b) that are not so qualified shall be true and correct as of the
Closing Date as if made anew as of such date (except to the extent such
representations and warranties expressly relate to an earlier date (in which
case as of such earlier date)), except for failures of the representations and
warranties referred to in this clause (b) to be true and correct as do not
and would not reasonably be expected to have, in the aggregate, a material
adverse effect on Buyers ability to consummate the transactions contemplated
hereby;
provided
that, notwithstanding the foregoing, the condition in
this
Section 5C(i)
shall be satisfied only if the
representations and warranties in
Section 8B
of this Agreement are
true and correct in all respects;
(ii) Each of the covenants and agreements
of Buyer and Merger Sub to be performed as of or prior to the Closing shall
have been performed in all material respects;
(iii) Buyer and Merger Sub shall have
delivered to the Company a certificate in the form of
Exhibit E
attached hereto dated the Closing Date and signed by a senior executive officer
of Buyer on behalf of Buyer and Merger Sub confirming the foregoing matters in
Sections
5C(i)
and
5C(ii)
;
(iv) Buyer and Merger Sub shall have
delivered to the Company certified copies of the resolutions or consents of the
boards of directors and stockholders and unitholders of Buyer and Merger Sub,
respectively, approving the Merger;
(v) The Company shall have received a
written opinion, dated as of the Closing Date, from Kirkland & Ellis
LLP or other counsel reasonably satisfactory to the Company to the effect that
the Merger and the Post-Closing Mergers will be treated for federal
income tax purposes as reorganizations within the meaning of Section 368
of the Code (or, in the case of the GLDD Merger, the opinion may be to the
effect that the GLDD Merger will instead be treated as a liquidation of GLDD
within the meaning of Section 332 of the Code) and, with respect to the
Merger, Buyer and the Company will each be a party to a reorganization within
the meaning of Section 368 of the Code and, with respect to the
Post-Closing Mergers, Buyer, Holdco and GLDD will each be a party to a
reorganization within the meaning of Section 368 of the Code (unless the
opinion states that the GLDD Merger is treated as a liquidation of GLDD within
the meaning of Section 332 of the Code, in which case only the Buyer will
be a party to a reorganization within the meaning of Section 368 of the
Code)
. In rendering such opinion, Kirkland &
14
Ellis LLP or
such other counsel may rely upon representations contained herein and customary
representation letters of the Company and the Buyer;
(vi) Buyer shall have made appropriate
arrangements with Continental Stock Transfer & Trust Company (
Continental
)
to have the Trust Fund disbursed to the Surviving Company immediately upon
Closing, not less than $40,000,000 of such cash released from the Trust Fund
shall be available to the Surviving Company for repayment of debt of the
Surviving Company and its Subsidiaries (including the Company and Subsidiaries
of the Company as of the date of this Agreement) and payment of fees and
expenses related to the transactions contemplated hereby (which expenses shall
not include, for the avoidance of doubt, any amount to be paid to holders of
Buyer Common Stock that have exercised their Conversion Rights) and there shall
be no action or proceeding pending or threatened with respect to or against the
Trust Fund other than claims by holders of Buyer Common Stock solely arising
from the exercise of Conversion Rights;
(vii) Buyers arrangements to pay the Buyer
Representative $7,500 per month or any other fee or expense shall be terminated
as of the Effective Time without further liability to Buyer or any of its post-Closing
Affiliates;
(viii) The period for delivery of notice of
intent to exercise appraisal rights with respect to the Holdco Merger shall
have expired and holders of less than 1% of the Buyer Common Stock (determined
as of immediately prior to the Holdco Merger) shall have properly exercised,
and not properly withdrawn, appraisal rights under Section 262 of the
Delaware Corporation Law with respect to the Holdco Merger;
(ix) The Holdco Certificate of
Incorporation shall have been filed with the Secretary of State for the
Delaware, shall have become effective under the laws of the State of Delaware
and shall not have been amended, modified or repealed, the Holdco Bylaws shall
be in full force and effect without amendment, modification or repeal and the Buyer
Post-Closing Directors shall be the directors of Holdco;
(x) At or prior to Closing, Buyer,
Holdco, and each of the Aldabra Shareholders (as defined in the Investor Rights
Agreement) shall have delivered to the holders of Company Capital Stock an executed
counterpart to the Investor Rights Agreement; and
(xi) The Buyer Representative, Buyer,
Holdco and the Escrow Agent shall have executed and delivered to the Company
Representative the Adjustment Escrow Agreement.
5D.
Waiver of
Condition
. Any condition to the Closing for a partys benefit may be waived
by such party in a writing executed by such party.
15
ARTICLE 6
CERTAIN COVENANTS PRIOR TO THE EFFECTIVE TIME
6A.
Access
. During
the period from the date of this Agreement to the earlier of the Closing and
the date that this Agreement is terminated in accordance with its terms, each
party shall grant to the other and its
authorized representatives reasonable access, during normal business hours and
upon reasonable notice, to the personnel, properties, books and records of the
other to the extent reasonably necessary for consummation of the transactions
contemplated hereby;
provided
that
such access does not
unreasonably interfere with the normal operations of any party;
provided
further
that all requests for access with respect to the Company and its
Subsidiaries shall be directed to Douglas Mackie, Richard Lowry, Deborah Wensel
or such other Person as the Company may designate in writing from time to time
(the
Company Designated Contacts
) and all requests for access with
respect to Buyer and Merger Sub shall be directed to Jason Weiss and Nathan
Leight or such other Person as the Buyer may designate in writing from time to
time (the
Buyer Designated Contacts
);
provided
,
however
,
that nothing herein shall require any party to provide access or to disclose
any information to any other party if such access or disclosure (i) would
cause significant competitive harm to such party if the transactions
contemplated by this Agreement are not consummated or (ii) would be in
violation of applicable laws or regulations of any governmental entity
(including the HSR Act and other anti-competition laws) or the provisions of
any agreement to which such party is a party. Other than the Company Designated
Contacts or as expressly provided in the preceding sentence, Buyer is not
authorized to and shall not (and shall cause its employees, agents,
representatives and Affiliates not to) contact any officer, director, employee,
franchisee, customer, supplier, distributor, lender or other material business
relation of the Company or any of its Subsidiaries prior to the Closing without
the prior written consent of the Company. In no event shall any Phase II or
invasive soil testing be permitted without the prior written consent of the
Company. Each party shall, and shall cause its representatives to, abide by the
terms of the Confidentiality Agreement with respect to such access and any
information furnished to it or its representatives pursuant to this
Section 6A
.
6B.
Ordinary Conduct
of Company
. During the period from the date of this Agreement to the
earlier of the Closing Date and the date on which this Agreement is terminated
in accordance with its terms, except as set forth on
Section 6B
of
the Company Disclosure Letter, or as otherwise consented to by Buyer in writing
(which consent shall not be unreasonably withheld, conditioned or delayed) or
as otherwise contemplated by this Agreement, the Company shall not, and shall
cause each of its Subsidiaries not to:
(i) make any material change in the
conduct of its business, except for changes that are in the ordinary course or
not inconsistent in material respects with past practice;
(ii) enter into a new agreement that would
be included in the definition of Company Material Contracts if it had been
entered into as of the date of this Agreement or amend in a material manner any
of the Company Material Contracts, other than in the ordinary course of
business consistent in material respects with past practice or as otherwise
necessary for the maintenance of property relating to their respective
16
businesses or
as otherwise necessary to permit the consummation of the Merger, the
Post-Closing Mergers and the other transactions and actions contemplated by
this Agreement;
(iii) amend the Company Charter Documents;
(iv) acquire or agree to acquire by merging
or consolidating with or purchasing a substantial equity interest in or
substantially all the assets of, or otherwise acquire any business or any
corporation, partnership, association or other business organization or
division thereof;
(v) except in the ordinary course of
business consistent with past practice, sell, lease, sublease, mortgage, pledge
or otherwise encumber or dispose of any of the material properties, assets or
equipment owned by the Company or its Subsidiaries, or enter into any agreement
regarding the foregoing;
(vi) declare or pay any dividends on or
make any distributions in respect of any of its capital stock, except for
dividends by a wholly owned Subsidiary of the Company or such Subsidiary and
except for amounts that would reduce the amounts that would otherwise be included
in the computation of Company Closing Net Indebtedness;
(vii) repurchase, redeem or otherwise
acquire, or permit any Subsidiary to repurchase, redeem or otherwise acquire,
any shares of its capital stock or of the capital stock of any of its
Subsidiaries, except for repurchases, redemptions and acquisitions from
employees upon termination of employment;
(viii) issue, sell, split, combine or
reclassify any of its capital stock or equity securities, securities
convertible into its capital stock or equity securities, or any options,
warrants or other rights to purchase its capital stock or equity securities, or
enter into any agreement regarding the foregoing;
(ix) incur any indebtedness for borrowed
money or any capitalized lease obligations, or guarantee any such indebtedness
or capitalized lease obligations, or issue or sell any debt securities or
warrants or rights to acquire any debt securities of the Company or any of its
Subsidiaries, or guarantee any debt securities of others, other than (x) in
the ordinary course of business consistent with past practice, (y) pursuant
to the Equipment Facility, the Senior Credit Agreement or the Underwriting
Agreement, or (z) amounts that will be included in the computation of
Company Closing Net Indebtedness;
(x) subject to any material Lien any
portion of its material properties or assets;
(xi) prepare or file any Tax Return
inconsistent in any material respect with past practice or, on any such Tax
Return, take any position, make an election, or adopt any method that is
materially inconsistent with positions taken, elections made or methods used in
preparing or filing similar Tax Returns in prior periods;
(xii) except in the ordinary course of
business or as required by law or contractual obligations or other agreements
existing on the date hereof, increase in any manner the compensation of, or
enter into any new bonus, incentive, employee benefits,
17
severance or
termination agreement or arrangement with, any of its officers or employees; or
(xiii) agree to do any of the foregoing
6C.
Exclusive
Transaction
. The Company agrees that from the date of this Agreement
and until the earlier of the Closing Date and the date that this Agreement is
terminated in accordance with its terms, the Company shall not enter into
negotiations or any agreement regarding the terms of any sale of all or more
than 20% of the Company Capital Stock or assets of the Company with any Person
other than Buyer, its Affiliates and their respective representatives. The
Buyer agrees that from the date of this Agreement until the earlier of the
Closing Date and the date that this Agreement is terminated in accordance with
its terms, Buyer shall not enter into any negotiations or any agreement
regarding a business combination (as defined in Buyers certificate of
incorporation). Notwithstanding the foregoing, the Company and Buyer may enter
into negotiations otherwise prohibited by this Section 6C if it is advised
by its outside counsel that failure to enter into negotiations would cause its
board of directors to violate its fiduciary duties, in which case each of the
Company and Buyer may enter into negotiations otherwise prohibited by this Section 6C
as long as such party does not take any other action prohibited by this Section 6C.
6D.
Joint Prospectus/Proxy
Statement; Buyer Shareholder Approval
.
(i) Buyer shall, and shall cause Holdco
to, within twenty (20) days of its receipt of (x) all required information
for inclusion in the Joint Prospectus/Proxy Statement (as hereinafter defined)
from the Company and (y) the consent of Deloitte & Touche LLP
with respect to the inclusion in the Joint Prospectus/Proxy Statement of the
audited and unaudited (as applicable) consolidated financial statements of the
Company and its Subsidiaries prepared by Deloitte & Touche LLP, file
with the Securities and Exchange Commission (the
SEC
) a registration
statement on Form S-4 (or such other appropriate form) (the
Registration
Statement
) containing: (i) a proxy statement in preliminary form or
such other form, statement or report as may be required under the federal
securities laws relating to a shareholders meeting (the
Shareholder Meeting
)
to be held by Buyer to obtain Buyer Shareholder Approval (as hereinafter
defined); and (ii) a prospectus relating to the shares of Buyer Common
Stock to be issued to holders of the Companys Capital Stock in the Merger and
the shares of Holdco Common Stock to be issued to holders of Buyer Common Stock
in the Holdco Merger (such joint proxy statement or such other form and
prospectus, and any amendments or supplements thereto (the
Joint
Prospectus/Proxy Statement
)), which Joint Prospectus/Proxy Statement may
be used as an Information Statement by the Company with respect to the holders
of Company Capital Stock. Buyer shall duly call, give notice of, convene and
hold the Shareholder Meeting and solicit proxies as promptly as reasonably
practicable in accordance with applicable law for the purpose of seeking Buyer
Shareholder Approval.
Buyer Shareholder Approval
shall mean collectively,
(A) the affirmative vote of the holders of a majority of the shares of
common stock issued in Buyers initial public offering (the
IPO Shares
)
in favor of the transactions contemplated by this Agreement and other
shareholders of the Buyer shall have voted their shares in the same manner as
the majority of IPO Shares, in accordance with, and as required by, Buyer
Charter
18
Documents, (B) the
affirmative vote of Buyers shareholders necessary under the Buyer Charter
Documents and applicable law necessary to cause the directors of the Buyer as
of the Effective Time to consist of the following individuals: Thomas Souleles, Douglas Grissom, Douglas
Mackie, Nathan Leight, Jason Weiss, Jonathan Berger, Peter Deutsch, and one
other individual qualified as an independent director under the applicable
federal securities and regulations and the regulations of Nasdaq, as designated
in writing by the Company Representative (collectively, the
Buyer
Post-Closing Directors
), (C) the affirmative vote of Buyers shareholders
necessary to amend Buyers Certificate of Incorporation to increase the number
of authorized shares of Buyer Common Stock to a number sufficient to satisfy
Buyers obligations under this Agreement with respect to the issuance of Buyer
Common Stock, but in no event to exceed 40,000,000 shares of Buyer Common Stock
(as so amended, the
Buyer Post-Closing Certificate of Incorporation
),
and (D) the affirmative vote of Buyers shareholders necessary to approve
the Holdco Merger.
(ii) Buyer agrees that the Joint
Prospectus/Proxy Statement will comply in all material respects with all of the
requirements of the Exchange Act and Buyer will ensure that the Joint
Prospectus/Proxy Statement will not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading, except that no
representation or warranty is made by Buyer with respect to information
supplied in writing by the Company expressly for inclusion in the Joint
Prospectus/Proxy Statement. Buyer shall promptly correct any information
provided by it for use in the Joint Prospectus/Proxy Statement if and to the
extent that such information becomes false or misleading and shall take all
steps necessary to cause the Joint Prospectus/Proxy Statement as so corrected
to be filed with the SEC and disseminated to its shareholders and the holders
of Company Capital Stock, in each case as and to the extent required by the
Securities Act or the Exchange Act. Buyer shall give the Company and its
counsel a reasonable opportunity (but no more than 5 Business Days) to review
and comment on the Joint Prospectus/Proxy Statement, and any amendments or supplements
thereto, prior to the filing of any such documents with the SEC and Buyer will
give due consideration to the Companys comments. Buyer will provide to the
Company and its counsel any comments that Buyer or its counsel may receive from
the SEC or its staff, whether written or oral, with respect to the Joint
Prospectus/Proxy Statement promptly after receipt of any such comments. Buyer
will use its reasonable best efforts to respond promptly to any comments
received from the SEC or its staff.
(iii) The Company will ensure that none of
the information regarding the Company or its Subsidiaries supplied by the
Company, its representatives, or any Subsidiary expressly for inclusion in the
Joint Prospectus/Proxy Statement (including any information included in
consolidated financial statements or other financial information required to be
included in the Joint Prospectus/Proxy Statement) will contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein in light of
the circumstances under which they were made, not misleading. If at any time
prior to Closing, a change in such information which would make the preceding
sentence incorrect should be discovered by
19
the Company,
the Company will promptly notify Buyer of such change. Buyer shall promptly
correct any such information in the Joint Prospectus/Proxy Statement and shall
take all steps necessary to cause the Joint Prospectus/Proxy Statement as so
corrected to be filed with the SEC and disseminated to its shareholders and the
holders of Company Capital Stock, in each case as and to the extent required by
the Exchange Act. The Company and its representatives agree to reasonably
cooperate with Buyer in its preparation of the Joint Prospectus/Proxy Statement
and the filing of the Joint Prospectus/Proxy Statement with the SEC.
(iv) The Company agrees to use its
commercially reasonable efforts to obtain the auditors consents with respect
to the inclusion of its consolidated financial statements in the Joint
Prospectus/Proxy Statement, and to otherwise provide as soon as reasonably
practicable any information about the Company and its Subsidiaries required by
the Exchange Act reasonably sufficient to permit Buyer to prepare and file the
Joint Prospectus/Proxy Statement.
(v) Buyer, through its board of
directors, shall recommend to its shareholders that they give the Buyer
Shareholder Approval and, subject to applicable law and the exercise of its
fiduciary duties (in the good faith judgment of its board of directors based on
the advice of independent legal counsel), shall not withdraw or modify its
recommendation. Buyer shall use its reasonable best efforts to obtain the Buyer
Shareholder Approval.
6E.
Tax Treatment
. The
parties shall cooperate with each other and use their respective reasonable
efforts to cause the Merger and the Post-Closing Mergers to qualify as reorganizations
within the meaning of Section 368 of the Code (the
Intended Tax
Treatment
), including (i) not taking any action that such party knows
is reasonably likely to prevent the Intended Tax Treatment, (ii) executing
such amendments to this Agreement as may be reasonably required in order to
obtain the Intended Tax Treatment (it being understood that no party will be
required to agree to any such amendment that it determines in good faith
materially adversely affects the value of the transactions contemplated hereby
to such party or its stockholders), and (iii) unless waived in writing by
Buyer or the Company, as applicable, using their respective reasonable best
efforts to obtain the opinions referred to in
Section 5B(vi)
or
Section 5C(v)
, including by executing customary letters of
representation. In the event that, for any reason, any party (the
Delivering
Party
) learns that the opinion referred to in
Section 5B(vi)
or
Section 5C(v)
, as applicable, cannot be, or may not be, delivered
for any reason, it shall deliver prompt written notice of such fact to the
other party (the
Receiving Party
), in which case such Receiving Party
shall have a period of 30 days to if it so elects (a) find other reputable
tax counsel reasonably satisfactory to Buyer (in the case of the opinion
referred to in
Section 5B(vi)
) or the Company (in the case of the
opinion referred to in
Section 5C(v)
) to deliver such opinions to
Buyer or the Company, respectively, (b) agree to amend this Agreement to
provide that the condition referred to in
Section 5B(vi)
or
Section 5C(v)
shall
provide for obtaining an IRS private letter ruling to the effect that the Merger
and the Post-Closing Mergers will be treated for federal income tax purposes as
reorganizations within the meaning of Section 368 of the Code (or, in
the case of the GLDD Merger, the private letter ruling may be to the effect
that the GLDD Merger will instead be treated as a liquidation of GLDD within
the meaning of Section 332 of the Code) and, with respect to the Merger,
Buyer and the Company will each be a
20
party to a reorganization
within the meaning of Section 368 of the Code and, with respect to the
Post-Closing Mergers, Buyer, Holdco and GLDD will each be a party to a
reorganization within the meaning of Section 368 of the Code (unless the
opinion states that the GLDD Merger is treated as a liquidation of GLDD within
the meaning of Section 332 of the Code, in which case only the Buyer will
be a party to a reorganization within the meaning of Section 368 of the
Code)
, or (c) offer to amend the structure contemplated by this
Agreement;
provided
that, notwithstanding anything in this Agreement to
the contrary, the Receiving Party shall not be obligated to take any of the
actions referred to in this sentence, but if the Receiving Party does so elect,
without limiting any other rights of termination available to the Delivering
Party, the Delivering Party shall not have the right to terminate this
Agreement by reason of failure of such condition unless the Delivering Party
does not cause the satisfaction of such condition at or prior to Closing. In
the event that the Receiving Party elects option (a) or (b) of the
foregoing sentence, each party shall execute and deliver to such firm customary
letters of representation that would reasonably be expected to be delivered by
such party in connection with such opinion or IRS private letter ruling and if
the Receiving Party elects option (c) of the foregoing sentence, each
party shall, and shall cause their respective affiliates party to this
Agreement to, execute such amendments unless (i) either party, in
consultation with its advisors can reasonably conclude that such alternative
structure proposed would substantially increase the tax costs of the
transactions to the parties and/or its stockholders relative to the Intended
Tax Treatment and the other party is not willing to bear such increased costs
upon consummation of the transactions contemplated hereby and thereby or (ii) either
party reasonably determines that such alternative structure results in a
material adverse change to the economics of the transactions contemplated by
this Agreement to such party.
6F.
Ordinary Conduct
of Buyer
. During the period from the date of this Agreement to the
earlier of the Closing Date and the date on which this Agreement is terminated
in accordance with its terms, except as otherwise consented to by the Company
in writing or as otherwise contemplated by this Agreement, each of Buyer and
Merger Sub shall not and shall cause each of their respective Subsidiaries not
to:
(i) make any material change in the
conduct of its business, except for changes that are in the ordinary course of
business consistent with past practice;
(ii) issue, sell, split, combine or
reclassify any of its capital stock or equity securities, securities
convertible into its capital stock or equity securities, or warrants, options
or other rights to purchase its capital stock or equity securities;
(iii) subject to any Lien any portion of its
material properties or assets (including any cash in the Trust Fund);
(iv) incur any indebtedness for borrowed
money or any capitalized lease obligations or guaranteed any such indebtedness
or capitalized lease obligations or issue or sell any debt securities or
warrants or rights to acquire any debt securities of Buyer or guarantee any
debt securities of Buyer, that would not be included in the computation of
Buyer Closing Net Working Capital;
21
(v) spend any cash in the Trust Fund or
spend any other cash other than for payment of liabilities incurred in the
ordinary course of business or declare or pay any dividends on or make any
distributions in respect of any of its capital stock;
(vi) make any loans or advances to, or
guarantees for the benefit of, any Persons (except to employees in the ordinary
course of business);
(vii) enter into a new agreement that would
be included in the definition of Buyer Material Contracts if it had been
entered into as of the date of this Agreement or amend in a material manner any
of the Buyer Material Contracts or, other than in the ordinary course of
business consistent with past practice or as otherwise necessary for the
maintenance of property relating to their respective businesses;
(viii) amend its certificate of incorporation
or bylaws;
(ix) incur any material Tax liability that
is not paid prior to Closing;
(x) approve or enter into any employee
plans, programs, practices or arrangements;
(xi) acquire by merging or consolidating
with, or agreeing to merge or consolidate with, or purchase substantially all
the assets of, or otherwise acquire any business or any corporation,
partnership, association or other business organization or division thereof;
(xii) prepare or file any Tax Return
inconsistent in any material respect with past practice or, on any such Tax
Return, take any position, make an election, or adopt any method that is
materially inconsistent with positions taken, elections made or methods used in
preparing or filing similar Tax Returns in prior periods;
(xiii) except in the ordinary course of
business or as required by law or contractual obligations or other agreements
existing on the date hereof, increase in any manner the compensation of, or
enter into any new bonus, incentive, employee benefits, severance or
termination agreement or arrangement with, any of its officers or employees; or
(xiv) agree to do any of the foregoing.
Notwithstanding the foregoing, in no event shall the
aggregate amount of indebtedness and capitalized lease obligations incurred
and/or guaranteed by Buyer and/or any of its Subsidiaries exceed $1,000,000.00
in the aggregate (disregarding for this purpose any obligations of Buyer to pay
for shares of Buyer Common Stock pursuant to the exercise of Conversion
Rights).
22
ARTICLE 7
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
As an inducement to Buyer
and Merger Sub to enter into this Agreement, the Company hereby represents and
warrants that, except as set forth in the Company Disclosure Letter or as set
forth in the Company SEC Reports filed on or prior to the date hereof:
7A.
Organization and
Corporate Power
. Each of the Company and GLDD is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and is qualified to do business as a foreign corporation and is in
good standing in each jurisdiction in which the failure to so qualify or be in
good standing would have a Company Material Adverse Effect. The Company and its
Subsidiaries have all requisite corporate power and authority necessary to own
and operate their properties and to carry on their businesses as now conducted
and to enter into this Agreement and consummate the transactions contemplated
hereby. The copies of the Companys Certificate of Incorporation and By-Laws
which have been made available to Buyer reflect all amendments made thereto at
any time prior to the date of this Agreement.
7B.
Company Capital
Stock
. The authorized capital stock of the Company consists of (i) 90,000
shares of Series A Preferred Stock, of which (as of the date hereof)
77,500 shares are issued and outstanding and owned of record as set forth on
Section 7B
of the Company Disclosure Letter, (ii) 10,000 shares of Series B
Preferred Stock, of which (as of the date hereof) 9,471 shares are issued and
outstanding and owned of record as set forth on
Section 7B
of the
Company Disclosure Letter and (iii) 1,500,000 shares of Company Common
Stock, of which (as of the date hereof) 996,400 shares are issued and
outstanding and owned of record as set forth on
Section 7B
of the
Company Disclosure Letter. All of the outstanding shares of Company Capital
Stock have been duly authorized, validly issued, fully paid and non-assessable
and have not been issued in violation of any purchase option, call option,
right of first refusal, preemptive right, subscription right or any similar
right under any provision of the Delaware Corporation Law, the Companys Charter
Documents or any other agreement to which the Company is a party or otherwise
bound. There are not any bonds, debentures, notes or other indebtedness of the
Company or any of its Subsidiaries having the right to vote (or convertible
into, or exchangeable for, securities having the right to vote) on any matters
on which holders of capital stock of the Company may vote (
Voting Company
Debt
). Except as may exist in the Management Equity Agreement,
Subscription Agreement or the Registration Rights Agreement, (x) there are
no options, warrants, rights, convertible or exchangeable securities, phantom
stock or other equity rights, stock or other equity appreciation rights, stock
or other equity-based performance units, commitments, contracts, arrangements
or undertakings of any kind to which the Company or any of its Subsidiaries is
a party or by which any of them is bound and (y) there are not any
outstanding contractual obligations of Buyer to repurchase, redeem or otherwise
acquire any capital stock of other equity interests in Buyer.
7C.
Subsidiaries
.
Section 7C
of the Company Disclosure Letter sets forth the name of each Material
Subsidiary of the Company, the jurisdiction of its incorporation or
organization and the outstanding capital stock or other equity interests of
such Subsidiary owned by the Company or any of its Subsidiaries. Each such
Material Subsidiary listed on
Section 7C
of the Company Disclosure
Letter is an entity validly existing and in good standing (or an equivalent
23
foreign
concept to the extent applicable) under the laws of the jurisdiction of its
incorporation or organization and is qualified to do business in each
jurisdiction in which the failure to so qualify or be in good standing would
have a Company Material Adverse Effect. Except as set forth on
Section 7C
of the Company Disclosure Letter, all of the outstanding capital stock or other
equity securities of each such Material Subsidiary are owned by the Company or
another Subsidiary of the Company free and clear of any Liens, other than
Permitted Encumbrances. Except for Inactive Subsidiaries and except as
otherwise set forth on
Section 7C
of the Company Disclosure Letter,
neither the Company nor any of its Subsidiaries owns or holds the right to
acquire any shares of stock or any other security or interest in any other
Person.
7D.
Authorization; No
Breach
. This Agreement has been duly executed and delivered by the
Company and, assuming receipt of the Company Shareholder Approval, constitutes
a valid and binding obligation of the Company, enforceable in accordance with
its terms, except as limited by the application of bankruptcy, moratorium and
other laws affecting creditors rights generally and as limited by the
availability of specific performance and the application of equitable
principles. Assuming receipt of the consents set forth on
Section 7D
of the Company Disclosure Letter and the HSR Approval or except as set forth on
Section 7D
of the Company Disclosure Letter, none of the execution,
delivery nor performance of this Agreement by the Company nor the consummation
of the transactions contemplated hereby nor compliance by the Company with the
terms hereof will (i) conflict with or result in any material breach of
any of the provisions of, (ii) constitute (with or without due notice or
the passage of time or both) a material default under, (iii) give any
third party the right to terminate, amend, cancel or accelerate, (iv) result
in the creation of any lien, security interest, charge or encumbrance upon any
of the shares of capital stock or any assets of the Company or its Subsidiaries
or (v) require any filing with, or permit, authorization, consent,
approval, exemption or other action by or notice to any court or other
governmental body, except as has been obtained or as contemplated in this
Agreement (including
Section 1B
and
Section 5A(i)
),
under (a) the Company Charter Documents, (b) any Company Material
Contract, (c) any judgment, order or decree to which the Company or any of
its Subsidiaries is subject, or (d) any law statute, rule or
regulation to which the Company or any of its Subsidiaries is subject, except
in the cases of clauses (b), (c) and (d) foregoing, as would not
result in a Company Material Adverse Effect.
7E.
Company SEC
Reports; Financial Statements
.
(i) The Company has made available to
Buyer a correct and complete copy of each report, registration statement and
definitive proxy statement filed by the Company or any of its Subsidiaries with
the SEC since January 1, 2005 (the
Company SEC Reports
), which
are all the forms, reports and documents required to be filed by the Company or
any of its Subsidiaries with the SEC prior to the date of this Agreement. As of
their respective dates, the Company SEC Reports (including the financial
statements included therein): (x) were prepared in accordance with, and
complied in all material respects with, the requirements of the Securities Act
or the Exchange Act, as the case may be, and the rules and regulations of
the SEC thereunder applicable to such Company SEC Reports, and (y) did not
at the time they were filed (and if amended or superseded by a filing prior to
the date of this Agreement then on the date of such filing and as so amended or
superseded) contain any untrue statement of a material fact or omit to state a
24
material fact
required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not
misleading.
(ii) Each set of financial statements
(including, in each case, any related notes thereto) contained in the Company
SEC Reports, including each Company SEC Report filed after the date hereof
until the Closing, complied or will comply as to form in all material respects
with the applicable accounting requirements and the published rules and
regulations of the SEC with respect thereto, was or will be prepared in
accordance with GAAP applied on a consistent basis throughout the periods
involved (except as may be indicated in the notes thereto or, in the case of
unaudited statements, do not contain footnotes as permitted by Form 10-Q
of the Exchange Act) and each fairly presents or will fairly present in all
material respects the consolidated financial position of GLDD and its
Subsidiaries at the respective dates thereof and the consolidated results of
its operations and cash flows for GLDD and its Subsidiaries for the periods
indicated, except that the unaudited interim financial statements were, are or
will be subject to normal adjustments which were not or are not expected to
have a Company Material Adverse Effect.
(iii) The Company, on a stand-alone basis,
has no liabilities required to be included on a balance sheet prepared in
accordance with GAAP other than (A) guarantees of obligations of its
wholly-owned Subsidiaries, (B) liabilities that arise from ownership of
its Subsidiaries, (C) transaction expenses related to the transactions
contemplated hereby, (D) liabilities incidental to its existence (e.g.,
franchise taxes), and (E) other liabilities which are not material to the
Company and its Subsidiaries on a consolidated basis. Without regard to any
differences in the stockholders equity line or that may relate to the Company
Preferred Stock and the accrued and unpaid dividends thereon, the consolidated
financial statements of the Company and its Subsidiaries for each period
covered by the Company SEC Reports (other than quarterly Company SEC Reports on
Form 10-Q for the periods ended March 31, 2005, June 30,
2005 and September 30, 2005) will not differ from the consolidated
financial statements of GLDD and its Subsidiaries included in the Company SEC
Reports for such periods in a manner that would reflect a Company Material
Adverse Effect.
(iv) The Company and its Subsidiaries have
no liabilities (absolute, accrued, contingent or otherwise) of a nature
required to be disclosed on a balance sheet or in the related notes to the
financial statements included in the Company SEC Reports which are,
individually or in the aggregate, material to the business, results of
operations or financial condition of Buyer, except (A) liabilities
provided for in or otherwise disclosed in the Company SEC Reports filed prior
to the date hereof, (B) liabilities incurred since March 31, 2006 in
the ordinary course of business, (C) liabilities disclosed in the Company
Disclosure Letter and (D) other liabilities which would not have a Company
Material Adverse Effect.
25
7F.
Absence of
Certain Developments
. Except as set forth in
Section 7F
of the Company Disclosure Letter or as otherwise contemplated by this
Agreement, during the period from December 31, 2005 to the date of this
Agreement, neither the Company nor any of its Subsidiaries has:
(i) operated in any material respect
other than in the ordinary course of business consistent with past practice;
(ii) issued or sold any of its capital
stock or equity securities, securities convertible into its capital stock or
equity securities, or warrants, options or other rights to purchase its capital
stock or equity securities;
(iii) subjected to any material Lien any
portion of its properties or assets;
(iv) incurred any indebtedness for borrowed
money or any capitalized lease obligations, or guaranteed any such indebtedness
or capitalized lease obligations, or issued or sold any debt securities or
warrants or rights to acquire any debt securities of the Company or any of its
Subsidiaries, or guaranteed any debt securities of others, other than (x) in
the ordinary course of business consistent with past practice, (y) pursuant
to the Equipment Facility, the Senior Credit Agreement or the Underwriting
Agreement, or (z) amounts that will be included in the computation of
Company Closing Net Indebtedness;
(v) sold, assigned or transferred any
material portion of its tangible assets, except in the ordinary course of
business;
(vi) sold, assigned or transferred any
patents, trademarks, trade names, copyrights, trade secrets or other intangible
assets, except in the ordinary course of business;
(vii) made or granted any material bonus or
any material compensation or salary increase to any former or current employee
or group of former or current employees (except in the ordinary course of
business in accordance with past practice), or made or granted any material
increase in any employee benefit plan or arrangement, or amended or terminated
any existing employee benefit plan or arrangement or severance agreement or
employment contract or adopted any new employee benefit plan or arrangement or
severance agreement or employment contract;
(viii) made any loans or advances to, or
guarantees for the benefit of, any Persons, other than (x) in the ordinary
course of business consistent with past practices, (y) intercompany loans
and advances among or between the Company and its Subsidiaries and (z) pursuant
to the Equipment Facility, the Senior Credit Agreement, the Underwriting
Agreement or the Indenture; or
(ix) suffered any material damage,
destruction or other casualty loss with respect to material property owned by
the Company or any of its Subsidiaries that is not covered by insurance.
26
7G.
Real Property
.
(i) With respect to each parcel of Owned
Real Property, and except for matters that would not have a Company Material
Adverse Effect: (a) the Company or
one of its Subsidiaries has good fee simple title, free and clear of all Liens,
except Permitted Encumbrances; (b) neither the Company nor any of its
Subsidiaries has leased or otherwise granted to any Person the right to use or
occupy such Owned Real Property or any portion thereof; and (c) there are
no outstanding options, rights of first offer or rights of first refusal to
purchase such Owned Real Property or any portion thereof.
(ii) The Company has not received written
notice of any material default under any of the Leases which has not been cured
or waived. To the Companys knowledge, except as may arise from consummation of
the transactions contemplated hereby or except as set forth on
Section 7G(ii)
of
the Company Disclosure Letter, no event has occurred which would allow the
other party thereto to terminate or accelerate performance under or otherwise
modify (including upon the giving of notice or the passage of time) any of such
Leases.
(iii) Except (a) as set forth on
Section 7G(iii)
of
the Company Disclosure Letter, (b) as set forth in the Company SEC
Reports, (c) for Permitted Encumbrances, and (d) as would not
otherwise result in a Company Material Adverse Effect, the Company or one of
its Subsidiaries owns, free and clear of all Liens, or has a contract, license
or lease to use, all of the personal property and assets shown on the balance
sheet included in the Company SEC Reports as of and for the period ended March 31,
2006, acquired thereafter or located on its premises which is material to its
business or operations.
7H.
Tax Matters
.
(i) Except as set forth on
Section 7H
of the Company Disclosure Letter, (A) the Company and each of its
Subsidiaries has timely filed all material Tax Returns that it is required to
file; (B) to the Companys knowledge, all such Tax Returns are accurate
and complete in all material respects, (C) except as would not result in a
Company Material Adverse Effect, all Taxes due and owing by the Company or any
of its Subsidiaries shall have been paid by the Company or its Subsidiaries; (D) no
deficiency or proposed adjustment which has not been paid or resolved for any
material amount of Tax has been asserted, proposed or assessed by any Taxing
authority against the Company or any of its Subsidiaries; (E) neither the
Company nor any of its Subsidiaries has consented to extend the time in which
any Tax may be assessed or collected by any Taxing authority and neither the
Company nor any of its Subsidiaries has waived any statute of limitations with
respect to any Taxes, in both cases other than for consents and extensions
which by their terms have expired; (F) as of the date hereof, there are no
ongoing or pending or, threatened in writing, Tax audits, examinations, or
investigations in respect of Taxes of the Company or any of its Subsidiaries by
any Taxing authority against the Company or any of its Subsidiaries; (G) except
as would not result in a Company Material Adverse Effect, the unpaid Taxes of
the Company and its Subsidiaries for Tax periods through March 31, 2006 do
not exceed the accruals and reserves for
27
Taxes
(excluding accruals and reserves for deferred Taxes) set forth on the financial
statements included in the Company SEC Reports; (H) with respect to all
Tax years ending on or before December 31, 1992, the federal income Tax
Returns referred to in clause (A) have been examined by the IRS or the
appropriate Taxing authority or the period for assessment of the Taxes in
respect of which such Tax Returns were required to be filed has expired; (I) there
are no material Liens relating to Taxes on any of the assets of the Company or
any of its Subsidiaries, except for Liens relating to current Taxes not yet due
and payable or relating to Taxes that are being contested in good faith; (J) during
the last five years, neither the Company nor any of its Subsidiaries has been a
party to any transaction treated by the parties thereto as one to which Section 355
of the Code applied; and (K) neither the Company nor any of its
Subsidiaries has engaged in a listed transaction within the meaning of
Treasury Regulation 1.6011-4(b)(2) or reported a reportable
transaction within the meaning of Treasury Regulation Section 1.6011-4.
(ii) No payment or other benefit will
result from the transactions contemplated by this Agreement based on
arrangements entered into by the Company or any of its Subsidiaries that is (or
under Section 280G of the Code and the Treasury Regulations thereunder is
presumed to be) a parachute payment to a disqualified individual as those terms
are defined in Section 280G of the Code and the Treasury Regulations
thereunder.
(iii) Neither the Company nor any of its
Subsidiaries has received within the last five years prior to the date hereof a
Tax opinion by counsel with respect to, in connection with or related to a
transaction outside the ordinary course of the Companys or the Subsidiarys
business.
7I.
Company Material
Contracts
. Except as disclosed on
Section 7I
of the
Company Disclosure Letter, the Company or one of its Subsidiaries, as
applicable, has performed all material obligations required to be performed by
them to date under the Company Material Contracts and, assuming receipt of
consents specified on
Section 7D
of the Company Disclosure Letter,
is not (with or without the lapse of time or the giving of notice, or both) in
breach or default thereunder, except for failures to perform or any such breach
or default that would not result in a Company Material Adverse Effect.
7J.
Intellectual
Property
. Except as set forth on
Section 7J
of the
Company Disclosure Letter, the Company or one of its Subsidiaries owns and
possesses good title to all Company Intellectual Property. No claims are
pending in writing or, to the knowledge of the Company, threatened in writing
against the Company or any of its Subsidiaries as of the date of this Agreement
with respect to the ownership, use or validity of any Company Intellectual
Property, other than claims which if determined adversely to the Company and
its Subsidiaries would not result in a Company Material Adverse Effect. Except
as set forth on
Section 7J
of the Company Disclosure Letter, as of
the date of this Agreement, neither the Company nor any of its Subsidiaries
have been sued or charged as a defendant in any claim, suit, action, or
proceeding which involves a claim of infringement of any Intellectual Property
Rights of any third party and which has not been finally terminated prior to
the date hereof, other than suits or charges which if determined adversely to
the Company and its Subsidiaries would not result in a Company Material Adverse
Effect.
28
7K.
Legal Proceedings
. Except
as set forth on
Section 7K
of the Company Disclosure Letter, as of
the date of this Agreement, there are no actions, suits, proceedings or orders
pending or, to the Companys knowledge, threatened against the Company or any
of its Subsidiaries at law or in equity, or before or by any federal, state,
municipal or other governmental department, commission, board, bureau, agency
or instrumentality, domestic or foreign, which if determined adversely to the
Company or any of its Subsidiaries would result in a Company Material Adverse
Effect.
7L.
Brokerage
. There
are no claims for brokerage commissions, finders fees, or similar compensation
in connection with the transactions contemplated by this Agreement based on any
arrangement or agreement made by or on behalf of the Company or any of its
Subsidiaries.
7M.
Company Employee
Benefit Plans
.
(i)
Section 7M
of the
Company Disclosure Letter lists all Plans. Copies of all Plans and the summary
plan descriptions, the most recent annual reports on Internal Revenue Service Form 5500
and actuarial reports, if applicable, and, if not applicable, statement of
trust assets, for such Plans have been made available to the Buyer.
(ii) Except as set forth on
Section 7M
of the Company Disclosure Letter or except as would not result in a Company
Material Adverse Effect, (A) there is no accumulated funding deficiency,
whether or not waived, within the meaning of Section 302 of ERISA, and Section 412
of the Code with respect to any Plan that is subject to such sections, (B) no
reportable event (other than those for which the 30-day notice to the
Pension Benefit Guaranty Corporation (
PBGC
) has been waived) or prohibited
transaction (other than those for which there is an available exemption) (as
such terms are defined in ERISA and the Code, as applicable) has occurred with
respect to any Plan during the five years preceding the Closing Date, (C) each
Plan is and has been operated in compliance in all material respects with the
presently applicable provisions of ERISA, the Code and other applicable law, (D) neither
the Company nor any of its Subsidiaries has incurred any liability under Title
IV of ERISA to the PBGC in connection with any Plan subject to Title IV of
ERISA that has not been fully paid prior to the date hereof, other than
liability for premiums due the PBGC, which premiums have been paid when due,
and no such Plan has been terminated or is reasonably expected to be terminated
or to be subject to proceedings by the PBGC under Title IV of ERISA on or
before the Closing Date, (E) the IRS has issued, with respect to each Plan
intended to be tax qualified under Sections 401(a) and 501(a) of the
Code, a letter determining that such Plan is qualified and its related trust is
exempt from United States federal income tax under Sections 401(a) and 501(a) of
the Code, respectively, and there has been no occurrence affecting the form or
operation of any Plan since the date of any such determination letter which is
likely to adversely affect such qualification, (F) no Plan is a multiple
employer plan (within the meaning of Section 413(c) of the Code) or
a multiemployer plan (as defined in Section 3(37) of ERISA), and no
withdrawal liability has been incurred by or asserted against the Company or
any of its Subsidiaries with respect to any employee pension benefit plan which
is a multiple employer plan or a multiemployer plan, (G) the Company has
received no notice and has no knowledge or
29
reasonable
expectation that any Plan is currently insolvent or currently in reorganization
within the meaning of Title IV of ERISA or that increased contributions to any
Plan are currently required to avoid a reduction in plan benefits or the
imposition of any excise tax, and (H) as of the date of this Agreement,
there are no actions or claims existing or pending (other than routine claims
for benefits) or threatened with respect to any Plan, and neither the Company
nor any of its Subsidiaries has been notified of any audit or investigation of
a Plan by any applicable governmental entity.
The Company does not make the representations
in Subsections (A), (B), (C), (E) and (H) of this clause (ii) as
to any Plan which is a multiemployer plan.
(iii) Except as set forth on
Section 7M
of the Company Disclosure Letter or except as would not result in a Company
Material Adverse Effect, (A) each Plan that is a group health plan (as
defined in Section 4980B of the Code) has been operated in material
compliance with Section 4980B of the Code and the Health Insurance
Portability and Accountability Act of 1996, (B) neither the Company nor
any of its Subsidiaries has any material obligation or liability to provide
medical, life insurance or supplemental pension benefits in respect of any
current or former employees or independent contractors of the Company or any of
its Subsidiaries beyond their retirement, and (C) no Plan provides for
severance pay, unemployment compensation or any similar payment with respect to
any current or former employee or independent contractor of the Company or any
of its Subsidiaries.
The
Company does not make the representations in this clause (iii) with
respect to any Plan which is a multiemployer plan.
(iv) Except as set forth on
Section 7M
of the Company Disclosure Letter or except as would not result in a Company
Material Adverse Effect, all contributions required to be made by the Company
or any of its Subsidiaries under applicable law or the terms of any Plan or
collective bargaining agreement have been made within the time prescribed by
such law, Plan or collective bargaining agreement.
(v) Except as set forth on
Section 7M
of the Company Disclosure Letter or except as would not result in a Company
Material Adverse Effect, the Company and each of its Subsidiaries (A) is
in compliance with all applicable laws respecting employment, employment
practices, terms and conditions of employment and wages and hours (including,
but not limited to, the Worker Adjustment Retraining Notification Act, the Age
Discrimination in Employment Act, the Civil Rights Act of 1964, the Equal Pay
Act, the Occupational Safety and Health Act, the Fair Labor Standards Act, the
Americans with Disability Act of 1990, the Family and Medical Leave Act of
1993, and any other federal, state or local law regulating employment or
protecting employee rights), in each case, with respect to current and former
employees and independent contractors of the Company and its Subsidiaries, (B) has
withheld all amounts required by applicable Laws or by agreement to be withheld
from the wages, salaries and other payments to such current and former
employees and independent contractors, (C) is not liable for any arrears
of wages or any taxes or any penalty for failure to comply with any of the
foregoing, and (D) is not liable for any payment to any trust or other
fund or to any applicable governmental entity, with respect to unemployment
compensation benefits, social security or other benefits for such current or
former employees and independent contractors.
30
(vi) Except as set forth on
Section 7M
of the Company Disclosure Letter or except as would not result in a Company
Material Adverse Effect, no event has occurred or would reasonably be expected
to occur that would subject the Company or any Subsidiary thereof, by reason of
its affiliation with any of its ERISA Affiliates, to any tax, fine, lien,
penalty or other liability imposed by Title IV of ERISA, the Code or other
applicable laws, rules and regulations.
(vii) Except as set forth on
Section 7M
of the Company Disclosure Letter or except as would not result in a Company
Material Adverse Effect, neither the Company nor any of its Subsidiaries
maintains sponsors, contributes to or has any material liability with respect
to any Plan that provides benefits to non-resident aliens with no United States
source income outside of the United States (each, a
Foreign Plan
). Each
Foreign Plan has been maintained, funded and administered in compliance in all
material respects with applicable law and the respective requirements of such
Foreign Plans governing documents, and no Foreign Plan has any material
unfunded or underfunded liabilities.
7N.
Insurance
. To
the knowledge of the Company, all of the insurance policies of the Company and
its Subsidiaries are in full force and effect, and neither the Company nor any
of its Subsidiaries is in default in any material respect regarding its obligations
under any of such insurance policies.
7O.
Permits;
Compliance with Applicable Laws
.
(i) Each of the Company and any of its
Subsidiaries is in possession of all authorizations, licenses, permits,
certificates, approvals and clearances, and has submitted notices to, all
governmental entities necessary for the Company or any of its Subsidiaries to
own, lease and operate its properties or other assets and to carry on their
respective businesses as they are being conducted as of the date hereof (the
Company
Permits
), and all such Company Permits are valid, and in full force and
effect, except where the failure to have, or the suspension or cancellation of,
or failure to be valid or in full force and effect of, any of the Company
Permits would not, individually or in the aggregate, have a Company Material
Adverse Effect.
(ii) Except as set forth on
Section 7O
of the Company Disclosure Letter, since January 1, 2004, the Company and
its Subsidiaries have (A) complied with all applicable statutes, laws, ordinances,
rules, orders and regulations of any governmental authority, domestic or
foreign (including the Foreign Corrupt Practices Act), applicable to the
Company and its Subsidiaries and (B) not been in conflict with, or in
default or violation of, any Company Permits, except in each case to the extent
any instances of non compliance, conflict, default or violation would not
result in a Company Material Adverse Effect. Except as set forth on
Section 7O
of the Company Disclosure Letter since January 1, 2004, neither the
Company nor any of its Subsidiaries has received any written communication from
a governmental authority that alleges that any of them is not in compliance
with any material federal, state, foreign or local laws, rules and
regulations, except to the extent any instances of non compliance would not
result in a Company Material Adverse Effect.
31
7P.
Environmental
. Except
as set forth on
Section 7P
of the Company Disclosure Letter, (i) to
the Companys knowledge, the Company and its Subsidiaries are in compliance
with all Environmental Laws; (ii) to the Companys knowledge, the Company
and each of its Subsidiaries maintains and is in compliance with all permits,
licenses and other authorizations that are required pursuant to Environmental
Laws for the occupation of its facilities and the operation of its business as
conducted on the Closing Date (
Environmental Permits
); (iii) none
of the Company or its Subsidiaries has received any written notice or claim
regarding any actual or alleged violation of Environmental Laws, any
liabilities or potential liabilities arising under Environmental Laws or any
liabilities or potential liabilities regarding any actual or alleged Release or
threatened Release of a Hazardous Material into the indoor or outdoor
environment, which notice or claim remains outstanding except as would not
result in a Company Material Adverse Effect; (iv) neither this Agreement
nor the consummation of the transaction that is the subject of this Agreement
will result in any obligations for site investigation or cleanup, or
notification to or consent of government agencies pursuant to any transaction-triggered
or responsible property transfer Environmental Laws; (v) neither the
Company nor its Subsidiaries own or operate any underground storage tanks; (vi) the
Company has provided to Buyer copies of all material environmental assessments
prepared since September 30, 2003, relating to the Company or any of its
Subsidiaries to the extent the forgoing are in the possession of the Company or
any of its Subsidiaries; (vii) there are no actions, suits, proceedings
(including arbitration), orders or investigations pending or, to the Companys
knowledge, threatened against the Company or any of its Subsidiaries regarding
any actual or alleged violation of Environmental Laws, any liabilities or
potential liabilities arising under Environmental Laws or any liabilities or
potential liabilities regarding any actual or alleged Release or threatened
Release of a Hazardous Material into the indoor or outdoor environment, other
than in each case as would not result in a Company Material Adverse Effect and (viii) neither
the Company nor any of its Subsidiaries is subject to any order, decree or
settlement agreement regarding (A) any actual or alleged violation of
Environmental Laws, (B) any liabilities or potential liabilities arising
under Environmental Laws or (C) any liabilities or potential liabilities
regarding any actual or alleged Release or threatened Release of a Hazardous
Material under which the Company or any of its Subsidiaries has continuing
obligations except as would not result in a Company Material Adverse Effect.
7Q.
Labor Matters
. Except
as set forth on
Section 7Q
of the Company Disclosure Letter, (i) no
employees of the Company or any Subsidiary are represented by any labor
organization and there is no union organizational activity currently underway,
or to the Companys knowledge, threatened, with respect to any employees of the
Company or any Subsidiary, (ii) as of the date of this Agreement, neither
the Company nor any Subsidiary is engaged in, or has received any written
notice during the current or preceding year of, any unfair labor practice, and
no such complaint is pending before the National Labor Relations Board or any
other agency having jurisdiction thereof, in each case which would result in a
Company Material Adverse Effect, (iii) as of the date of this Agreement,
neither the Company nor any Subsidiary is engaged in, or has received any
notice of, any grievances arising under any collective bargaining agreements,
or any pending arbitration proceedings under any collective bargaining
agreements, in each case which would result in a Company Material Adverse
Effect, (iv) during the immediately preceding 24 calendar months there has
not been any, and there is no, threatened, labor strike, work stoppage or
slowdown pending against any portion of the
32
business of
the Company or its Subsidiaries, and there is no pending lockout by the Company
or any Subsidiary.
ARTICLE 8
REPRESENTATIONS, WARRANTIES AND
COVENANTS OF BUYER AND MERGER SUB
As an inducement to the
Company to enter into this Agreement, Buyer and
Merger Sub hereby represent and warrant that, except as set forth in the
Buyer SEC Reports as filed through the date hereof:
8A.
Organization and
Corporate Power
. Buyer is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and is
qualified to do business as a foreign corporation and is in good standing in
each jurisdiction in which the failure to so qualify or be in good standing
would have a material adverse effect upon the financial condition or operating
results of Buyer taken as a whole or on the ability of Buyer to consummate the
transactions contemplated hereby. Merger Sub is a limited liability company duly
organized, validly existing and in good standing under the laws of the State of
Delaware and is qualified to do business as a foreign limited liability company
and is in good standing in each jurisdiction in which the failure to so qualify
or be in good standing would have a material adverse effect upon the financial
condition or operating results of Buyer taken as a whole or on the ability of
Merger Sub to consummate the transactions contemplated hereby. Each of Buyer
and Merger Sub has all requisite corporate or limited liability company power
and authority necessary to own and operate their properties and to carry on
their businesses as now conducted and to enter into this Agreement and
consummate the transactions contemplated hereby. The copies of the certificate
of incorporation and by-laws of Buyer and the certificate of formation and
limited liability company agreement of Merger Sub which have been made
available to the Company reflect all amendments made thereto at any time prior
to the date of this Agreement. As a result of Buyers execution and delivery of
this Agreement, there is no obligation under Buyers Certificate of
Incorporation that Buyer liquidate or dissolve prior to February 24, 2007.
8B.
Buyer Capital
Stock
. The authorized capital stock of the Buyer consists of (i) 1,000,000
shares of Buyer Preferred Stock, of which 0 shares are issued and outstanding, (ii) 35,000,000
shares of Buyer Common Stock, of which 11,200,000 shares are issued and
outstanding. All of the outstanding shares of Buyer Common Stock have been, and
all shares of Buyer Common Stock to be issued to holders of Company Capital
Stock upon consummation of the Merger will (upon issuance) be, duly authorized,
validly issued, fully paid and nonassessable and no such shares of Buyer Common
Stock have been or will be issued in violation of applicable securities laws or
in violation of any purchase option, call option, right of first refusal,
preemptive right, subscription right or any similar right under any provision
of the Delaware Corporation Law, Buyers certificate of incorporation or bylaws
or any other agreement to which Buyer is a party or otherwise bound. There are
not any bonds, debentures, notes or other indebtedness of Buyer having the
right to vote (or convertible into, or exchangeable for, securities having the
right to vote) on any matters on which holders of capital stock of Buyer may
vote (
Voting Buyer Debt
). Except for the Buyer Warrants, there are no
options, warrants, rights, convertible or exchangeable securities, phantom
stock or other equity rights, stock or other equity appreciation rights, stock
or other equity-based performance units, commitments,
33
contracts,
arrangements or undertakings of any kind to which Buyer is a party or by which
any of them is bound. The Buyer Warrants are, and after giving effect to the
Merger will be, exercisable for 18,400,000 shares of Buyer Common Stock at an
exercise price of $5.00 per share. The Buyer Warrants will, immediately after
the Holdco Merger, be exercisable for 18,400,000 shares of Holdco Common Stock
at an exercise price of $5.00 per share. No Buyer Warrants are exercisable
until consummation of the Merger. Except for rights of holders of Buyer Common
Stock to convert their shares of Buyer Common Stock into cash held in the Trust
Fund (all of which rights will expire upon consummation of the Merger), there
are not any outstanding contractual obligations of Buyer to repurchase, redeem
or otherwise acquire any capital stock of other equity interests in Buyer.
8C.
Buyer Equity
Interests
. Other than units of Merger Sub, and, when formed, Holdco
and Holdco Merger Sub, (i) Buyer does not own, or have a right or
obligation to purchase, any capital stock, membership interests, partnership
interests or equity securities, or any securities convertible into or
exchangeable for capital stock, membership interests, partnership interests or
equity securities, of any other Person and (ii) Buyer has no obligation to
invest money in, loan money to or make capital contributions to any other
Person. The authorized equity of Merger Sub consists of 1,000 Merger Sub Common
Units, all of which are issued and outstanding and owned beneficially and of
record by Buyer free and clear of all Liens. All Merger Sub Common Units are
validly issued.
8D.
Authorization; No
Breach
. This Agreement has been duly executed and delivered by each
of Buyer and Merger Sub and constitutes the valid and binding obligation of
each of Buyer and Merger Sub, enforceable in accordance with its terms, except
as limited by the application of bankruptcy, moratorium and other laws
affecting creditors rights generally and as limited by the availability of
specific performance and the application of equitable principles. Assuming
receipt of the HSR Approval, neither the execution, delivery and performance of
this Agreement by Buyer and Merger Sub, nor the consummation by Buyer and
Merger Sub of the transactions contemplated hereby and compliance by Buyer and
Merger Sub with any of the provisions hereof, will (i) conflict with or
result in any material breach of any of the provisions of, (ii) constitute
(with or without due notice or lapse of time or both) a material default under,
(iii) give any third party the right to terminate, amend, cancel or
accelerate, (iv) result in the creation of any lien, security interest,
charge or encumbrance upon any of the shares of capital stock or any assets of
Buyer or Merger Sub or (v) require any filing with, or permit,
authorization, consent, approval, exemption or other action by or notice to any
court or other governmental body, except as has been obtained or as
contemplated in this Agreement (including, without limitation,
Section 1B
and
Section 5A(i)
), under (a) the provisions of the Buyer
Charter Documents or Merger Subs certificate of incorporation or bylaws, (b) any
Buyer Material Contract, (c) any judgment, order or decree to which Buyer
or Merger Sub is subject, or (d) any law, statute, rule or regulation
to which Buyer or Merger Sub is subject, except, in the cases of clauses (b), (c) and
(d) foregoing, as would not have a material adverse effect on Buyer or its
ability to consummate the transactions contemplated hereby. Without limiting
the generality of the foregoing, the Merger and the other transactions
contemplated by this Agreement are a business combination within the meaning
of Buyers certificate of incorporation.
34
8E.
Legal Proceedings
. There
are no material actions, suits, proceedings or orders pending or, to Buyers
knowledge, threatened against Buyer or Merger Sub at law or in equity, or
before or by any federal, state, municipal or other governmental department,
commission, board, bureau, agency or instrumentality, domestic or foreign.
8F.
Board Approvals
.
(i) The Board of Directors of Buyer, by
resolutions duly adopted at a meeting duly called and held, has approved the
transactions contemplated by this Agreement, including the Merger and the
Holdco Merger, and has unanimously (A) declared the advisability of the
Merger and the Holdco Merger and approved this Agreement and the transactions
contemplated hereby, (B) approved the transactions contemplated by this
Agreement in its capacity as sole equityholder of Merger Sub and (C) determined
that the fair market value of the Company is equal to at least 80% of Buyers
net assets. Other than Buyer Shareholder Approval, no other corporate
proceedings on the part of Buyer are necessary to authorize the transactions
contemplated by this Agreement.
(ii) The Board of Directors of Merger Sub
has duly (A) determined that this Agreement and the Merger are advisable
and in the best interests of Merger Sub and (b) approved this Agreement
and the Merger. No other limited liability company proceedings on the part of
Merger Sub are necessary to authorize the transactions contemplated by this
Agreement.
8G.
SEC Filings;
Financial Statements
.
(i) Buyer has made available to the
Company a correct and complete copy of each report, registration statement and
definitive proxy statement filed by Buyer with the SEC (the
Buyer SEC
Reports
), which are all the forms, reports and documents required to be
filed by Buyer or any of its Subsidiaries with the SEC prior to the date of
this Agreement. As of their respective dates, the Buyer SEC Reports (including
the financial statements included therein): (x) were prepared in
accordance with and complied in all material respects with the applicable
requirements of the Securities Act or the Exchange Act, as the case may be, and
the rules and regulations of the SEC thereunder applicable to such Buyer
SEC Reports, and (y) did not at the time they were filed (and if amended
or superseded by a filing prior to the date of this Agreement then on the date
of such filing and as so amended or superseded) contain 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 light of the circumstances
under which they were made, not misleading.
(ii) Each set of financial statements
(including, in each case, any related notes thereto) contained in the Buyer SEC
Reports, including each Buyer SEC Report filed after the date hereof until the
Closing, complied or will comply as to form in all material respects with the
applicable accounting requirements and with the published rules and
regulations of the SEC with respect thereto, was or will be prepared in
accordance with U.S. GAAP applied on a consistent basis throughout the periods
involved (except as may be indicated in the notes thereto or, in the case of
unaudited statements, do not contain
35
footnotes as
permitted by Form 10-Q of the Exchange Act) and each fairly presents
or will fairly present in all material respects the consolidated financial
position of Buyer at the respective dates thereof and the consolidated results
of its operations and cash flows for the periods indicated, except that the
unaudited interim financial statements were, are or will be subject to normal
adjustments which were not or are not expected to be material adverse effect on
Buyer or its ability to consummate the transactions contemplated hereby.
8H.
No Undisclosed
Liabilities
. Buyer and its Subsidiaries have no liabilities
(absolute, accrued, contingent or otherwise) of a nature required to be
disclosed on a balance sheet or in the related notes to the financial
statements included in the Buyer SEC Reports which are, individually or in the
aggregate, material to the business, results of operations or financial
condition of Buyer, except (A) liabilities provided for in or otherwise
disclosed in the Buyer SEC Reports filed prior to the date hereof, (B) liabilities
incurred since March 31, 2006 in the ordinary course of business, (C) transaction
expenses related to the transactions contemplated hereby, and (D) other
liabilities which are not material to Buyer or its ability to consummate the
transactions contemplated hereby. Merger Sub was formed for the purpose of
completing the Merger and has no liabilities, other than transaction expenses
and other liabilities arising from the transactions contemplated hereby.
8I.
Trust Fund
. As
of the date hereof, Buyer has, and as of the Closing Date, Buyer will have, no
less than $50,000,000 invested in United States government securities within
the meaning of Section 2(a)(16) of the Investment Company Act of 1940 with
a maturity of 180 days or less, or in money market funds meeting certain conditions
under Rule 2a-7 promulgated under the Investment Company Act of 1940
in a trust account administered by Continental (the
Trust Fund
), less
such amounts, if any, as Buyer is required to pay to stockholders who elect to
have their shares converted to cash in accordance with the provisions of Buyers
Charter Documents. There are no claims or proceedings pending with respect to
the Trust Fund. All cash of Buyer not held in the Trust Fund has been invested
in United States government securities within the meaning of Section 2(a)(16)
of the Investment Company Act of 1940 with a maturity of 180 days or less, or
in money market funds meeting certain conditions under Rule 2a-7
promulgated under the Investment Company Act of 1940. Buyer is not, and the Surviving
Company and its Subsidiaries will not be as a result of consummation of the
Merger and the Post-Closing Mergers, subject to registration or regulation
under the Investment Company Act of 1940, as amended.
8J.
Brokerage
. Except
for fees owed to Morgan Joseph & Co., no agent, broker, investment
banker, financial advisor or other firm or Person is or will be entitled to any
brokers or finders fee or any other similar commission or fee in connection
with any of the transactions contemplated by this Agreement based upon
arrangements made by or on behalf of Buyer or any of its Affiliates.
8K.
Absence of Certain
Developments
. During the period from December 31, 2005 to the
date of this Agreement, neither Buyer nor Merger Sub has:
(i) operated in any material respect
other than in the ordinary course of business consistent with past practice;
36
(ii) issued or sold any of its capital
stock or equity securities, securities convertible into its capital stock or
equity securities, or warrants, options or other rights to purchase its capital
stock or equity securities;
(iii) subjected to any material Lien any
portion of its properties or assets (including any cash in the Trust Fund);
(iv) incurred any indebtedness for borrowed
money (other than pursuant to non-interest bearing loans from Nathan Leight,
Jason Weiss, Terrapin Partners LLC or any designee of any of the foregoing) or
any capitalized lease obligations, or guaranteed any indebtedness for borrowed
money or capitalized lease obligation of any other Person;
(v) spent any cash in the Trust Fund or
spent any other cash other than for payment of liabilities in the ordinary
course of business or in connection with the transactions contemplated hereby;
(vi) made any loans or advances to, or
guarantees for the benefit of, any Persons (except to employees in the ordinary
course of business);
(vii) incurred any material Tax liability which
it has not paid prior to Closing; or
(viii) suffered any material damage,
destruction or other casualty loss with respect to property owned by the
Company or any of its Subsidiaries that is not covered by insurance.
8L.
Buyer D&O
Policy
. Buyer has previously made available to the Company a true and
correct copy of the Buyers director and officer insurance policy (
Buyer
D&O Policy
). Buyer has paid all premiums related to the Buyer D&O
Policy and the consummation of the Merger and the transactions contemplated
hereby (including the Post-Closing Mergers) will not cause the Buyer and its
Subsidiaries to lose any rights or benefits under the Buyer D&O Policy. The
Buyer is not in default of its obligations in respect of the Buyer D&O
Policy and, to Buyers knowledge, the Buyer D&O Policy is in full force and
effect.
8M.
Compliance with
Applicable Laws
. Since their formation, each of the Buyer and Merger
Sub has complied in all material respects with all applicable statutes, laws,
ordinances, rules, orders and regulations of any governmental authority,
domestic or foreign (including the Foreign Corrupt Practices Act), applicable
to Buyer and Merger Sub, except to the extent any instances of non-compliance
would not have a material adverse effect on Buyer or its ability to consummate
the transactions contemplated hereby. Since its formation, neither the Buyer
nor Merger Sub has received any written communication from a governmental
authority that alleges that any of them is not in compliance in any material
respect with any material federal, state, foreign or local laws, rules and
regulations, except to the extent any instances of non-compliance would not
have a material adverse effect on Buyer or its ability to consummate the
transactions contemplated hereby.
8N.
Buyer Material
Contracts
. Each of Buyer and Merger Sub has performed all material
obligations required to be performed by them to date under the Buyer Material
37
Contracts and,
is not (with or without the lapse of time or the giving of notice, or both) in
breach or default thereunder in any material respect, except for failures to
perform or any such breach that would not have a material adverse effect on
Buyer or its ability to consummate the transactions contemplated hereby. Neither
Buyer nor any of its Subsidiaries has any Plans.
ARTICLE 9
TERMINATION
9A.
Termination
. Anything
contained herein to the contrary notwithstanding, this Agreement may be
terminated and the transactions contemplated hereby abandoned at any time prior
to the Effective Time:
(i) by the mutual written consent of
Buyer and the Company;
(ii) by Buyer, if there has been a
violation or breach by the Company of any covenant, representation or warranty
contained in this Agreement, or any other events or circumstances shall have
occurred, such that any of Buyers and Merger Subs conditions to closing set
forth on
Section 5A
or
Section 5B
hereof could not be
satisfied prior to February 24, 2007, and such violation or breach has not
been waived by Buyer or, in the case of a covenant breach, cured by the Company
within thirty days after written notice thereof from Buyer;
(iii) by the Company, if there has been a
violation or breach by Buyer or Merger of any covenant, representation or
warranty contained in this Agreement, or any other events or circumstances
shall have occurred, such that any of the Companys conditions to closing set
forth on
Section 5A
or
Section 5C
hereof could not be
satisfied prior to February 24, 2007, and such violation or breach has not
been waived by the Company or, in the case of a covenant breach, cured by Buyer
and Merger Sub within thirty days after written notice thereof by the Company;
(iv) by the Company if the Joint
Prospectus/Proxy Statement shall not have been filed with the SEC before October 31,
2006 unless the failure to file prior to such date resulted from the failure of
the Company to provide information for inclusion therein;
(v) by the Company if the Joint
Prospectus/Proxy Statement has not been declared effective by the SEC and
mailed to Buyer stockholders before January 15, 2006 unless the failure to
be declared effective or be mailed prior to such date resulted from the failure
of the Company to provide information for inclusion therein;
(vi) by either Buyer or the Company, if, at
the Shareholder Meeting (including any adjournments thereof), Buyer Shareholder
Approval is not obtained, or the holders of 20% or more of the IPO Shares
outstanding on the record date of the meeting exercise their rights to convert
the shares of Buyer Common Stock held by them into cash in accordance with the
Buyer Charter Documents;
38
(vii) by the Company at its sole discretion
if any governmental body or other entity shall institute any suit or action
challenging the validity or legality, or seeking to restrain the consummation
of, the transactions contemplated by this Agreement; or
(viii) by Buyer or the Company if the
transactions contemplated hereby have not been consummated prior to February 24,
2007;
provided
that
(a) Buyer shall not be entitled to
terminate this Agreement pursuant to this clause (viii) if Buyers willful
breach of this Agreement has prevented the consummation of the transactions
contemplated hereby and (b) the Company shall not be entitled to terminate
this Agreement pursuant to this clause (viii) if the Companys willful
breach of this Agreement has prevented the consummation of the transactions
contemplated hereby.
9B.
Effect of
Termination
. In the event of any termination of this Agreement by
Buyer or the Company as provided above, this Agreement shall forthwith become
void and of no further force or effect (other than this
Section 9B
,
Section 9C
,
Section 11C
,
Section 11M
and
Article 12
,
which shall survive the termination of this Agreement and shall be enforceable
by the parties hereto), and there shall be no liability or obligation on the
part of Buyer, the Company, the Buyer Representative or the Company
Representative to any other party hereto, except as set forth in this
Section 9B
and except for willful breaches of this Agreement prior to the time of such
termination and, in the case of Buyer, any failure to have sufficient
immediately available funds for the consummation of the transaction
contemplated hereby.
9C.
Limitation on
Remedy
. The Company hereby acknowledges that (a) it has read the
prospectus dated February 17, 2005, filed by Buyer with the SEC pursuant
to Rule 424 promulgated under the Securities Act and understands that
Buyer has established the Trust Fund, initially in an approximate amount of
$42,600,000 for the benefit of certain stockholders of Buyer and that Buyer may
disburse monies from the Trust Fund only (i) to certain stockholders of
Buyer in the event of the conversion of their shares or the liquidation of
Buyer or (ii) to Buyer after it consummates a business combination and (b) for
and in consideration of Buyer agreeing to evaluate the Company for purposes of
consummating a business combination with, it the Company agrees that, prior to
Closing, it does not have any right, title, interest or claim of any kind in or
to any monies in the Trust Fund and waives any such claim it may have in the
future as a result of, or arising out of, the agreement or any negotiations,
contracts or agreements with Buyer and will not seek recourse against the Trust
Fund for any reason whatsoever. The Company has agreed to such limitation if a
similar monetary limit is placed on the rights and remedies of Buyer and Merger
Sub against the Company. Therefore, notwithstanding
Section 9B
, the
parties agree that, in the event that the Agreement is terminated pursuant to
Section 9A
hereof and there is liability of a party pursuant to
Section 9B
hereof, the aggregate amount which the other party shall be entitled to collect
shall not exceed $1,000,000. In no event shall the provisions of this
Section 9C
limit any partys rights to specific performance of another partys obligations
hereunder or for other equitable relief.
ARTICLE 10
DEFINITIONS
Accounting Firm
shall have the meaning set
forth in
Section 4D
.
39
Accumulated Dividends
shall have the meaning
given to such term in the Companys Certificate of Incorporation.
Additional Merger Consideration
means, as of
any date of determination, the sum of (i) the portion of the Adjustment
Escrow Shares paid or payable to holders of Company Common Stock, plus (ii) any
Additional Shares paid or payable to holders of Company Common Stock.
Additional Per Share Merger Consideration
means, as of any relevant date of determination, the quotient determined by
dividing (i) the Additional Merger Consideration, by (ii) the
Aggregate Common Shares.
Additional Shares
shall have the meaning set
forth in
Section 4D(iii)
.
Adjustment Amount
shall have the meaning set
forth in
Section 4D(iii)
.
Adjustment Escrow Account
shall have the
meaning set forth in
Section 4B(iii)
.
Adjustment Escrow Agreement
shall have the
meaning set forth in
Section 4B(iii)
.
Adjustment Escrow Shares
means a number of
shares of Buyer Common Stock which, when multiplied by the Average Trading
Price, equals $3,000,000.
Adjustment Excess Shares
shall have the
meaning set forth in
Section 4E(iii)
.
Affiliate
means any Person that directly, or
indirectly through one or more intermediaries, controls or is controlled by or
is under common control with the party specified.
Aggregate Common Shares
means the aggregate
number of shares of Company Common Stock issued and outstanding immediately
prior to the Effective Time.
Agreement
shall have the meaning set forth in
the preamble.
Average Trading Price
means the average
closing price of Buyer Common Stock for the ten trading days ending on the
third trading day immediately prior to consummation of the Merger.
Base Merger Consideration
means a number of
shares of Buyer Common Stock determined by dividing $160,000,000 by the Average
Trading Price;
provided
that in no event shall the Base Merger
Consideration be less than 27,273,000 shares of Buyer Common Stock.
Buyer
shall have the meaning set forth in the
preamble.
Buyer Charter Documents
means Buyers
certificate of incorporation and by-laws.
Buyer Closing Net Working Capital
means Buyer
Net Working Capital as of 11:59 p.m. (Chicago, Illinois time) on the day
before the Closing;
provided
that notwithstanding
40
anything herein to the
contrary (including that Buyer Closing Net Working Capital is being measured as
11:59 p.m. on the day before the Closing and that Buyer Net Working
Capital is to be calculated in accordance with GAAP (as modified by this
Agreement)), (i) any transaction expenses of the Company and its
Subsidiaries triggered by consummation of the Merger (including any amounts
required to be paid to Morgan Joseph & Co. or any other investment
banker) and any transaction bonuses, retention bonuses or similar liabilities
entered into by the Buyer and its Subsidiaries prior to the Effective Time that
are triggered upon consummation of the Merger shall be included as current
liabilities in the computation of Buyer Closing Net Working Capital, and (ii) all
indebtedness for borrowed money and capitalized lease obligations of Buyer as
of the Closing Date (in each case regardless of the terms thereof) shall be
included in the computation of Buyer Closing Net Working Capital.
Buyer Common Stock
means the common stock,
par value $0.0001 per share, of Buyer.
Buyer Designated Contacts
shall have the
meaning set forth in
Section 6A
.
Buyer D&O Policy
shall have the meaning
set forth in
Section 8L
hereof.
Buyer Majority Holders
shall have the meaning
set forth in
Section 11J(ii)
.
Buyer Material Contract
means a material
contract, as such term is defined in Regulation S-K of the SEC, to which Buyer
is party.
Buyer Net Working Capital
means the excess of
(i) the sum of the current assets of Buyer and its Subsidiaries determined
on a consolidated basis in accordance with GAAP applied on a basis consistent
with the methodologies, practices, estimation techniques, assumptions and
principles used in the preparation of the financial statements included in the
Buyer SEC Reports related to the fiscal quarter ended March 31, 2006
(excluding any current asset related to the exercise or notice of exercise of
any Buyer Warrants), over (ii) the sum of the current liabilities of Buyer
and its Subsidiaries determined on a consolidated basis in accordance with GAAP
applied on a basis consistent with the methodologies, practices, estimation
techniques, assumptions and principles used in the preparation of the financial
statements included in the Buyer SEC Reports related to the fiscal quarter
ended March 31, 2006;
provided
that (x) the amounts reflected
in the line item Cash held in Trust Fund on Buyers balance sheet shall be
included in Buyers current assets, (y) the amounts reflected in the line item
Common Stock, subject to possible redemption shall not be included in Buyers
current liabilities and (z) the amounts included in the line item Deferred
trust income shall not be included in Buyers current liabilities.
Buyer Post-Closing Certificate of Incorporation
shall have the meaning set forth in
Section 6D(i)
.
Buyer Post-Closing Directors
shall have the
meaning set forth in
Section 6D(i)
Buyer Preferred Stock
means the preferred
stock, par value $0.0001 per share, of Buyer.
41
Buyer Representative
shall have the meaning
set forth in the preamble.
Buyer SEC Reports
shall have the meaning set
forth in
Section 8F
.
Buyer Shareholder Approval
shall have the
meaning set forth in
Section 6D
.
Buyer Warrants
means warrants to acquire
shares of Buyer Common Stock issued pursuant to the terms of that certain
Warrant Agreement, dated as of February 24, 2005, by and between Buyer and
Continental.
Buyers IPO
shall mean the February 2005
initial public offering of Buyers 8,000,000 units and February 2005
exercise of underwriters over-allotment option for an additional 1,200,000
units, with each unit consisting of one share of Buyer Common Stock and two
Buyer Warrants.
Capitalized Lease Obligations
means
obligations of the Company and its Subsidiaries as lessee or lessees under
leases that have been recorded as capital leases in accordance with GAAP.
Certificate
means a certificate which
immediately prior to the Effective Time represented any shares of Company
Capital Stock.
Certificate of Merger
shall have the meaning
set forth in
Section 1B
.
Closing
shall have the meaning set forth in
Section 4A
.
Closing Balance Sheet
shall have the meaning
set forth in
Section 4D
.
Closing Common Per Share Merger Consideration
means, in respect of each share of Company Common Stock outstanding immediately
prior to the Effective Time, a portion of the Closing Common Stock Merger
Consideration determined by dividing (i) the Closing Common Stock Merger
Consideration by (ii) the Aggregate Common Shares.
Closing Common Stock Merger Consideration
means the result equal to (i) the Closing Merger Consideration, minus (ii) the
Company Preferred Stock Merger Consideration, minus (iii) the Adjustment
Escrow Shares.
Closing Date
shall have the meaning set forth
in
Section 4A
.
Closing Excess Shares
shall have the meaning
set forth in
Section 4E(ii)
.
Closing Merger Consideration
means (i) in
the event that the result determined pursuant to clause (i) of Incremental
Closing Merger Consideration is positive, a number of shares of Buyer Common
Stock equal to the sum of Base Merger Consideration and Incremental Closing
Merger Consideration or (ii) in the event that the result determined
pursuant to clause (i) of Incremental Closing Merger Consideration is
negative, a number of shares of Buyer Common Stock equal to the excess of Base
Merger Consideration over the absolute value of the Incremental Closing Merger
Consideration.
42
Closing Statement
shall have the meaning set
forth in
Section 4D
.
COBRA
means Part 6 of Subtitle B of
Title I of ERISA, Section 4980B of the Code, and any similar state law.
Code
means the Internal Revenue Code of 1986,
as amended.
Common Shares Trust
shall have the meaning
set forth in
Section 4E(iv)
.
Company
shall have the meaning set forth in
the preamble.
Company Capital Stock
shall have the meaning
set forth in the preamble.
Company Charter Documents
shall mean the
Companys certificate of incorporation and by-laws.
Company Closing Net Indebtedness
means
Company Net Indebtedness as of 11:59 p.m. (Chicago, Illinois time) on the
day before the Closing.
Company Closing Net Working Capital
means
Company Net Working Capital as of 11:59 p.m. (Chicago, Illinois time) on
the day before the Closing;
provided
that notwithstanding anything
herein to the contrary (including that Company Closing Net Working Capital is
being measured as 11:59 p.m. on the day before the Closing and that
Closing Net Working Capital is to be calculated in accordance with GAAP (as
modified by this Agreement)), any transaction expenses of the Company and its
Subsidiaries triggered by consummation of the Merger (including any amounts
required to be paid to investment bankers) and any transaction bonuses,
retention bonuses or similar liabilities entered into by the Company and its
Subsidiaries prior to the Effective Time that are triggered upon consummation
of the Merger shall be included as current liabilities in the computation of
Company Closing Net Working Capital.
Company Common Stock
shall have the meaning
set forth in the preamble.
Company Designated Contacts
shall have the
meaning set forth in
Section 6A
.
Company Disclosure Letter
means the Company
Disclosure Letter delivered by the Company to Buyer on the date hereof, as
amended, supplemented or restated in accordance with
Section 12H
of
this Agreement.
Company Intellectual Property
means each of
the material registered Intellectual Property Rights owned by the Company or
one of its Subsidiaries.
Company Majority Holders
shall have the
meaning set forth in
Section 11J(i)
.
Company Material Adverse Effect
means an
effect, change affecting or condition having an effect on the Company and its
Subsidiaries that is materially adverse to (x) the business, financial
condition or operating results of the Company and its Subsidiaries taken as a
whole or (y) the ability of the Company to consummate the Merger, except
any adverse effect related to or resulting from (a) general business or
economic conditions affecting the
43
industry in which the
Company and its Subsidiaries operate, (b) national or international
political or social conditions, including the engagement by the United States
in hostilities, whether or not pursuant to the declaration of a national
emergency or war, or the occurrence of any military or terrorist attack upon
the United States, or any of its territories, possessions, or diplomatic or
consular offices or upon any military installation, equipment or personnel of
the United States, (c) financial, banking, or securities markets (including
any disruption thereof and any decline in the price of any security or any
market index), (d) changes in GAAP, (e) changes in laws, rules,
regulations, orders, or other binding directives issued by any governmental
entity, (f) the taking of any action contemplated by this Agreement and
the other agreements contemplated hereby, (g) any existing event,
occurrence, or circumstance with respect to which Buyer has knowledge as of the
date hereof (including any matter set forth in the Company Disclosure Letter), (h) any
adverse change in or effect on the business of the Company and its Subsidiaries
that is cured by or on behalf of the Company before the earlier of the Closing
Date and the date on which this Agreement is terminated pursuant to
Article 9
,
or (i) Buyers failure to consent to any of the actions restricted by
Section 6B
.
Company Material Contract
means a material
contract, as such term is defined in Regulation S-K of the SEC, to which the
Company or any of its Subsidiaries is party.
Company Net Indebtedness
means, without
duplication, the excess of (i) the sum of (a) all principal and
accrued (but unpaid) interest owing by the Company and its Subsidiaries for
debt for borrowed money owed to any third party, including pursuant to the
Equipment Facility, the Senior Credit Agreement and the notes issued pursuant
to the Indenture and (b) the long-term portion of Capitalized Lease
Obligations (i.e., the portion not included in the computation of Company
Closing Net Working Capital), over (ii) the amount of cash and cash
equivalents of the Company and its Subsidiaries. In no event shall clause (i) of
Net Indebtedness include (x) any liabilities related to inter-company debt
between the Company and any of its Subsidiaries and any Subsidiary of the
Company and another Subsidiary of the Company, (y) any liabilities
included in the calculation of Company Preferred Stock Merger Consideration, or
(z) any liabilities for any letters of credit, performance bonds, surety
bonds and similar obligations of the Company and its Subsidiaries or any
liabilities for which the Company, including any such liability arising under
the Underwriting Agreement.
Company Net Working Capital
means the excess
of (i) the sum of the Companys and its Subsidiaries current assets on a
consolidated basis determined in accordance with GAAP applied on a basis
consistent with the methodologies, practices, estimation techniques,
assumptions and principles used in the preparation of the financial statements
included in the Company SEC Reports related to the fiscal quarter ended March 31,
2006 (excluding (a) cash and cash equivalents, and (b) any accounts
receivable related to the Companys Tampa, Florida project), over (ii) the
sum of the Companys and its Subsidiaries current liabilities on a
consolidated basis determined in accordance with GAAP applied on a basis
consistent with the methodologies, practices, estimation techniques,
assumptions and principles used in the preparation of the financial statements
included in the Company SEC Reports related to the fiscal quarter ended March 31,
2006 (excluding (a) any liabilities that are included in, or relate to the
liabilities included in, clause (i)(a) of Net Indebtedness, (b) any
liabilities of the Company or any of its Subsidiaries in respect of any letter
of credit, performance bond or other obligation issued by the Company or any of
its Subsidiaries whether issued
44
pursuant to the Senior
Credit Agreement or otherwise, and (c) any amounts included in the
computation of Company Preferred Stock Merger Consideration).
Company Permits
shall have the meaning set
forth in
Section 7O(i)
.
Company Preferred Stock
shall have the
meaning set forth in the preamble.
Company Preferred Stock Merger Consideration
means a number of shares of Buyer Common Stock which, when multiplied by the
Average Trading Price, equals the sum of (i) the Liquidation Value per
share multiplied by the number of shares of Company Preferred Stock outstanding
as of immediately prior to the Effective Time, plus (ii) the aggregate
Accumulated Dividends plus all other accrued but unpaid dividends on all shares
of Company Preferred Stock outstanding as of immediately prior to the Effective
Time as determined in accordance with the Companys Certificate of Incorporation.
Company SEC Reports
has the meaning set forth
in
Section 7E
.
Company Shareholder Approval
means the
consent of holders of a majority of the Company Capital Stock entitled to vote
on the Merger and a waiver of redemption, conversion or similar rights that any
holders of Company Capital Stock may have as a result of the transactions
contemplated hereby.
Confidentiality Agreement
shall have the
meaning set forth in
Section 11C
.
Constituent Companies
shall have the meaning
set forth in the preamble.
Continental
shall have the meaning set forth
in
Section 5C(vi)
.
Conversion Rights
shall have the meaning set
forth in
Section 11O
.
Delaware Corporation Law
shall have the
meaning set forth in the preamble.
Delaware LLC Act
shall have the meaning set
forth in the preamble.
Delivering Party
shall have the meaning set
forth in
Section 6D
.
Dissenting Shares
shall have the meaning in
Section 3B
.
Effective Time
shall have the meaning set
forth in
Section 1B
.
Employee Benefit Plan
means each material employee
benefit plan (as such term is defined in Section 3(3) of ERISA) and
each other material employee benefit plan, program or arrangement that is
maintained, sponsored or contributed to by the Company or its Subsidiaries on
behalf of employees located in the United States.
Environmental Laws
shall mean all statutes,
regulations, and ordinances of any Governmental Authority having the force or
effect of law, all treaties and international agreements having the force of
effect of law and all judicial and administrative orders and determinations,
concerning pollution or protection of the environment, including all those
45
relating to protection of
the marine environment, the presence, use, production, generation, handling,
transportation, treatment, storage, disposal, distribution, labeling, testing,
processing, discharge, release, threatened release, control, or cleanup of any
hazardous materials, hazardous substances or hazardous wastes, chemical
substances or chemical mixtures, pesticides, pollutants, contaminants, toxic
chemicals, petroleum products or byproducts, asbestos, or polychlorinated
biphenyls, that were enacted prior to the Closing Date and as they are in
effect on the Closing Date.
Environmental Permits
shall have the meaning set
forth in
Section 7P
.
Equipment Facility
means that certain Senior
Credit Agreement, dated as of December 17, 2003, by and between Great
Lakes Dredge & Dock Company and General Electric Capital Corporation,
as amended, modified, supplemented or waived from time to time.
ERISA
means the United States Employee
Retirement Income Security Act of 1974, as amended.
ERISA Affiliate
means any entity that is,
with the Company and its Subsidiaries, a member of a controlled group for
purposes of Section 4001(a)(14) of ERISA.
Escrow Agent
shall have the meaning set forth
in the Adjustment Escrow Agreement.
Estimated Buyer Closing Net Working Capital
means Buyer Closing Net Working Capital, as estimated by Buyer and delivered to
the Company not less than one (1) business day prior to Closing.
Estimated Company Closing Net Indebtedness
means Company Closing Net Indebtedness, as estimated by the Company and
delivered to Buyer not less than one (1) business day prior to Closing.
Estimated Company Closing Net Working Capital
means Company Closing Net Working Capital, as estimated by the Company and
delivered to Buyer not less than one (1) business day prior to Closing.
Excess Amount
shall have the meaning set
forth in
Section 4D(iv)
.
Exchange Act
means the Securities Exchange
Act of 1934, as amended.
Foreign Plan
shall have the meaning set forth
in
Section 7M
.
GAAP
means United States generally accepted
accounting principles.
Give-Back Shares
shall have the meaning set
forth in
Section 4D(iv)
.
GLDD
means Great Lakes Dredge & Dock
Corporation.
GLDD Merger
shall have the meaning set forth
in
Section 11N(iii)
.
46
Governmental Authority
shall mean any nation
or government, any federal, state, local or other political subdivision thereto
and any entity exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
Hazardous Materials
shall mean, without
regard to amount and/or concentrations (a) any element, compound, chemical
or other material that is defined, listed or otherwise classified or regulated
as a contaminant, pollutant, toxic pollutant, toxic or hazardous substances,
extremely hazardous substance or hazardous waste, medical waste, biohazardous
or infectious waste under Environmental Laws; (b) petroleum; (c) polychlorinated
biphenyls; (d) any substance exhibiting a hazardous waste characteristic
including but not limited to corrosivity, ignitibility, toxicity or reactivity;
and (e) any radioactive or explosive materials.
Holdco
shall have the meaning set forth in
Section 11N(i)
.
Holdco Bylaws
shall have the meaning set
forth in
Section 11N(i)
.
Holdco Certificate of Incorporation
shall
have the meaning set forth in
Section 11N(i)
.
Holdco Common Stock
shall have the meaning
set forth in
Section 11N(i)
.
Holdco Merger
shall have the meaning set
forth in
Section 11N(ii)
.
Holdco Merger Sub
shall have the meaning set
forth in
Section 11N(i)
.
Holdco Merger Sub Common Units
shall have the meaning set forth in
Section 11N(ii)
.
HSR Act
means the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended.
HSR Approval
shall have the meaning set forth
in
Section 5A(i)
.
Inactive Subsidiary
means any Subsidiary that
does not engage in any business activities and has assets less than $50,000.
Incremental Closing Merger Consideration
means a number of shares of Buyer Common Stock equal to the quotient determined
by dividing (i) the result equal to (A) the amount (if any) by which
the Estimated Company Closing Net Indebtedness is less than $250,000,000, minus
(B) the amount (if any) by which the Estimated Company Closing Net
Indebtedness is greater than $250,000,000, plus (C) the amount (if any) by
which the Estimated Company Closing Net Working Capital is greater than the
Targeted Company Net Working Capital, minus (D) the amount (if any) by
which the Estimated Company Closing Net Working Capital is less than the
Targeted Company Net Working Capital, plus (E) the amount (if any) by
which the Estimated Buyer Closing Net Working Capital is less than the Targeted
Buyer Net Working Capital, by (ii) the Average Trading Price;
provided
that, notwithstanding the foregoing, in no event shall the Incremental Closing
Merger Consideration exceed 7,500,000 shares of Buyer Common Stock.
47
Incremental Merger Consideration
means a
number of shares of Buyer Common Stock equal to the quotient determined by
dividing (i) the result equal to (A) the amount (if any) by which the
Company Closing Net Indebtedness is less than $250,000,000, minus (B) the
amount (if any) by which the Company Closing Net Indebtedness is greater than
$250,000,000, plus (C) the amount (if any) by which the Company Closing
Net Working Capital is greater than the Targeted Company Net Working Capital,
minus (D) the amount (if any) by which the Company Closing Net Working
Capital is less than the Targeted Company Net Working Capital, plus (E) the
amount (if any) by which the Buyer Closing Net Working Capital is less than the
Targeted Buyer Net Working Capital, by (ii) the Average Trading Price;
provided
that, notwithstanding the foregoing, in no event shall the Incremental Merger
Consideration exceed 7,500,000 shares of Buyer Common Stock.
Indenture
means that certain Indenture, dated
as of December 22, 2003, by and among GLDD Merger Sub, Inc. and BNY
Midwest Trust Company, as trustee (the
Trustee
), as amended or
supplemented by (i) that certain Supplemental Indenture, dated as of December 22,
2003, by and among GLDD, the guarantors party thereto and the Trustee, (ii) that
certain Amendment to Indenture, dated as of January 30, 2004, by and among
GLDD and the Trustee, (iii) that
certain Supplemental Indenture, dated as of February 27, 2004, by and
among GLDD, the guarantors party thereto and the Trustee, (iv) that
certain Second Supplemental Indenture, dated as of July 12, 2004, by and
among GLDD, the guarantors party thereto and the Trustee, and (v) that
certain Third Supplemental Indenture, dated as of December 2, 2005, by and
among GLDD, the guarantors party thereto and the Trustee, as amended, modified,
supplemented or waived from time to time.
Intellectual Property Rights
means all rights
in and to the following: (i) patents
and patent applications, (ii) trademarks, service marks, trade dress,
logos and registrations and applications for registration thereof together with
all of the goodwill associated therewith, (iii) copyrights (registered or
unregistered) and registrations and applications for registration thereof, (iv) mask
works and registrations and applications for registration thereof, and (v) trade
secrets, inventions (whether patentable or unpatentable and whether or not
reduced to practice) and know-how.
Intended Tax Treatment
shall have the meaning
set forth in
Section 6E
.
IPO Shares
shall have the meaning set forth
in
Section 6D
.
IRS
means the Internal Revenue Service.
Joint Prospectus / Proxy Statement
shall have
the meaning set forth in
Section 6D
.
knowledge
, when used in the phrase
to the
knowledge of the Company
or similar phrases means, and shall be limited
to, the actual knowledge of the Company Designated Contacts and when used in
the phrase
to the knowledge of Buyer
or similar phrases means, and
shall be limited to, the actual knowledge of the Buyer Designated Contacts.
48
Leased Real Property
means all leasehold or
subleasehold estates and other rights to use or occupy any land, buildings,
structures, improvements, fixtures, or other interest in real or immovable
property that is used in the Companys or any of its Subsidiaries business.
Leases
means all leases, subleases, licenses,
concessions and other agreements (written or oral), including all amendments,
extensions, renewals, guaranties and other agreements with respect thereto,
pursuant to which the Company or any of its Subsidiaries holds any Leased Real
Property and for which the annual rent obligation exceeds $50,000.
Letter of Transmittal
shall have the meaning
set forth in
Section 4B(ii)
.
Lien
means any mortgage, pledge, lien,
hypothec, encumbrance, charge or other security interest.
Liquidation Value
shall have the meaning set
forth in the Companys certificate of incorporation.
Majority Holders
shall have the meaning set
forth in
Section 11J
.
Management Equity Agreement
means the
Management Equity Agreement, dated as of December 22, 2003, among the
Company, the Company Representative and the management investors from time to
time party thereto.
Material Subsidiary
means any Subsidiary
other than an Inactive Subsidiary.
Merger
shall have the meaning set forth in
the preamble.
Merger Consideration
means the aggregate
consideration to which holders of Company Capital Stock are entitled (including
the Company Preferred Stock Merger Consideration, the Closing Common Stock
Merger Consideration and the Additional Merger Consideration), as determined in
accordance with this Agreement.
Merger Sub
shall have the meaning set forth
in the preamble.
Merger Sub Common Units
means the common
units of Merger Sub.
Multiemployer Plan
shall have the meaning set
forth in Section 3(37) of ERISA.
Nasdaq
shall mean the Nasdaq National Market.
Notice of Disagreement
shall have the meaning
set forth in
Section 4D
.
NYSE
means the New York Stock Exchange.
Owned Real Property
means all land, together
with all buildings, structures, improvements, and fixtures located thereon, and
all easements, servitudes and other interests and rights appurtenant thereto,
owned by the Company or any of its Subsidiaries and used in the business of the
Company or any of its Subsidiaries.
49
PBGC
shall have the meaning set forth in
Section 7M(ii)
.
Permitted Encumbrances
means (i) any
restriction on transfer arising under applicable securities law, (ii) Liens
for Taxes not yet delinquent or for Taxes that the taxpayer is contesting in
good faith through appropriate proceedings, (iii) purchase money Liens, (iv) Liens
of lessors or licensors arising under lease arrangements or license
arrangements, (v) Liens under, in connection with or pursuant to the
Senior Credit Agreement, the Underwriting Agreement and/or the Equipment
Facility, (vi) Liens arising in the ordinary course of business and not
incurred in connection with the borrowing of money, (vii) mechanics Liens
and similar Liens for labor, materials, or supplies, (viii) zoning,
building codes, and other land use laws regulating the use or occupancy of
Owned Real Property or Leased Real Property or the activities conducted thereon
that are imposed by any governmental authority having jurisdiction over such
Owned Real Property; (ix) rebates, refunds and other discounts to
customers, (x) easements, servitudes, covenants, conditions, restrictions,
and other similar matters affecting title to any assets of the Company or any
of its Subsidiaries and other title defects that do not or would not materially
impair the use or occupancy of such assets in the operation of the business of
the Company and its Subsidiaries taken as a whole, (xi) Liens set forth on
Section 10B
of the Company Disclosure Letter, and (xii) and other Liens that do not have a
Company Material Adverse Effect.
Person
means an individual, a partnership, a
limited liability company, a corporation, an association, a joint stock
company, a trust, a joint venture, an unincorporated organization and a
governmental entity or any department, agency or political subdivision thereof.
Plans
shall mean all material employee plans,
programs, practices and arrangements, including all employee benefit plans
(within the meaning of Section 3(3) of ERISA), employment agreements,
and health, medical, dental, welfare, accident, disability, life insurance,
stock purchase, bonus, equity and equity-type compensation, severance pay and
other employee benefit or fringe benefit plans maintained or contributed to by
the Company or any ERISA Affiliate with respect to which the Company or any
ERISA Affiliate has any fixed or contingent, direct or indirect liability with
respect to the Company.
Post-Closing Mergers
shall have the meaning
set forth in
Section 11N(iii)
.
Preferred Allocation Certificate
shall have
the meaning set forth in
Section 3A(ii)
.
Preferred Per Share Merger Consideration
means, with respect to each share of Company Preferred Stock outstanding as of
immediately prior to the Effective Time, the portion of the Company Preferred
Stock Merger Consideration to which each such share is entitled, as set forth
in the Preferred Allocation Certificate (which, for the avoidance of doubt,
shall be a number of shares of Buyer Common Stock, which when multiplied the
Average Trading Price, is equal to the Liquidation Value thereof plus the
aggregate Accumulated Dividends plus all other accrued but unpaid dividends on
such share).
Receiving Party
shall have the meaning set
forth in
Section 6E
.
50
Registration Rights Agreement
means the
Registration Rights Agreement, dated as of December 22, 2003, among the
Company, the Company Representative and the other investors from time to time
party thereto.
Registration Statement
shall have the meaning
set forth in
Section 6D(i)
.
Release
means any un-permitted presence,
spilling, leaking, pumping, emitting, emptying, discharging, injecting,
escaping, leaching, migrating, dumping, or disposing of Hazardous Materials
(including the abandonment or discarding of barrels, containers or other closed
receptacles containing Hazardous Materials into the environment.
Representation
shall have the meaning set
forth in
Section 12D
.
SEC
means the Securities and Exchange
Commission.
Securities Act
means the Securities Act of
1933, as amended.
Seller Group
shall have the meaning set forth
in
Section 11L
.
Senior Credit Agreement
means (i) the
Credit Agreement, dated as of December 22, 2003, by and between GLDD, the
Company, the other loan parties from time to time party thereto, the financial
institutions from time to time party thereto and Bank of America, N.A., as
issuer of the Letters of Credit and as representative of the Lenders, (ii) Amendment
No. 1 to Credit Agreement, dated as of September 30, 2004, by and
among GLDD, the Company, the other loan parties from time to time party
thereto, the financial institutions from time to time party thereto, and Bank
of America, N.A., as issuer of the Letters of Credit and as representative of
the Lenders, (iii) Amendment No. 2 to Credit Agreement, dated as of June 13,
2005, by and among GLDD, the Company, the other loan parties party thereto, the
financial institutions party thereto, and Bank of America, N.A., as issuer of
the Letters of Credit and as representative of the Lenders, (iv) Amendment
No. 3 to Credit Agreement, dated as of November 14, 2005 by and among
GLDD, the Company, the other loan parties party thereto, the financial
institutions party thereto, and Bank of America, N.A., as issuer of the Letters
of Credit and as representative of the Lenders, and (v) Amendment No. 4
to Credit Agreement, dated as of March 22, 2006, by and among GLDD, the
Company, the other loan parties party thereto, the financial institutions party
thereto, and Bank of America, N.A., as issuer of the Letters of Credit and as
representative of the Lenders, as further amended, modified, supplemented or
waived from time to time.
Shareholder Meeting
shall have the meaning set
forth in
Section 6D
.
Specific Representation
shall have the
meaning set forth in
Section 13D
.
Subscription Agreement
means that certain
Subscription Agreement, dated as of December 22, 2003, by and among the
Company, the Company Representative and the other investors from time to time
party thereto
Subsidiary
means, with respect to any Person,
any corporation, partnership, association or other business entity of which (i) if
a corporation, a majority of the total voting power of shares of stock entitled
(without regard to the occurrence of any contingency) to vote in
51
the election of
directors, managers or trustees thereof is at the time owned or controlled,
directly or indirectly, by that Person or one or more of the other Subsidiaries
of that Person or a combination thereof, or (ii) if a partnership,
association or other business entity, a majority of the partnership or other
similar ownership interest thereof is at the time owned or controlled, directly
or indirectly, by any Person or one or more Subsidiaries of that Person or a
combination thereof. For purposes hereof, a Person or Persons shall be deemed
to have a majority ownership interest in a partnership, association or other
business entity if such Person or Persons shall be allocated a majority of
partnership, association or other business entity gains or losses or shall be
or control the managing director or general partner of such partnership,
association or other business entity;
provided
that in no event shall
Amboy Aggregates, a New Jersey general partnership, be deemed a Subsidiary of
the Company.
Surviving Company
shall have the meaning set
forth in
Section 1A
.
Surviving Company Common Units
shall have the
meaning set forth in
Section 3A(i)
.
Targeted Buyer Net Working Capital
means
$50,000,000.
Targeted Company Net Working Capital
means
$47,097,000.
Tax
or
Taxes
means (i) any
federal, state, local or foreign income, gross receipts, license, payroll,
employment, excise, severance, stamp, occupation, premium, property or windfall
profits taxes, environmental taxes, customs duties, franchise, employees
income withholding, foreign or domestic withholding, social security,
unemployment, disability, real property, personal property, sales, use,
transfer, value added, goods and services, alternative or add on minimum or
other tax, including any interest, penalties or additions to Tax or additional
amounts in respect of the foregoing and (ii) any liability of any Person
for the payment of amounts with respect to payments of a type described in
clause (i) as a result of being a member of an affiliated, consolidated or
unitary group, or as a result of any obligations of such Person under any Tax
sharing agreement or any Tax indemnity agreement.
Tax Return
means any Tax return, declaration,
report, claim for refund, or information return or statement filed or required
to be filed by the Company or any of its Subsidiaries with respect to any Tax.
Title IV Plan
means any employee pension
benefit plan (as such term is defined in Section 3(2) of ERISA) that
is subject to Title IV of ERISA, other than a Multiemployer Plan.
Trust Fund
has the meaning set forth in
Section 8H
.
Underwriting Agreement
means that certain
Third Amended and Restated Underwriting and Continuing Indemnity Agreement,
dated as of December 22, 2003, by and among GLDD, certain of its
Subsidiaries, Travelers Casualty and Surety Company and Travelers Casualty and
Surety Company of America, as amended, modified, supplemented or waived from
time to time.
Voting Agreement
has the meaning set forth in
the preamble.
52
Voting Buyer Debt
has the meaning set forth
in
Section 8B
.
Voting Company Debt
has the meaning set forth
in
Section 7B
.
ARTICLE 11
ADDITIONAL AGREEMENTS
11A.
Survival
. Each
of the representations and warranties set forth in this Agreement or in any
certificate delivered in connection with this Agreement and each covenant
requiring performance prior to the Closing Date shall terminate effective
immediately as of the Closing such that no claim for breach of any such
representation or warranty, detrimental reliance or other right or remedy
(other than for common law actual fraud) may be brought after the Closing.
11B.
Press Release and
Announcements
. The Company and Buyer agree that, from the date hereof
through the Closing Date, no public release or announcement concerning the
transactions contemplated hereby shall be issued or made by or on behalf of any
party without the prior consent of the other parties, except that: (i) each
of the Company and its Subsidiaries may make announcements from time to time to
their respective employees; and (ii) each party may make such releases or
announcements as required by law, rule or regulation of the SEC;
provided
that each party shall prior to such release or announcement give the other
parties the opportunity to review and comment upon such release or announcement
to be filed pursuant to clause (ii) foregoing. Notwithstanding the
foregoing, Buyer and the Company shall cooperate to prepare a joint press
release to be issued on the Closing Date. The Company and Buyer agree to keep
the terms of this Agreement confidential, except to the extent required by
applicable law, rule or regulation of the SEC or for financial reporting
purposes and except that the parties may disclose such terms to their
respective accountants and other representatives as necessary in connection
with the ordinary conduct of their respective businesses (so long as such
Persons agree to or are bound by contract to keep the terms of this Agreement
confidential).
11C.
Confidentiality
. Each
party acknowledges that all information provided to any of its and its
Affiliates, agents and representatives by the Company and its Affiliates,
agents and representatives (including pursuant to
Section 6A
) is
subject to the terms of a confidentiality agreement between or on behalf of the
Company and Buyer (the
Confidentiality Agreement
), the terms of which
are hereby incorporated herein by reference.
11D.
Written Consents
. The
Company shall, in accordance with applicable law and its certificate of
incorporation and bylaws, promptly after Buyers mailing of the Joint Proxy,
mail to each holder of Company Capital Stock a written consent approving the
transactions contemplated hereby accompanied by a request that such stockholder
execute the written consent of its stockholders approving the Merger as
provided in Section 228 of the Delaware Corporation Law. In connection
with such request, the Company shall, through its board of directors, recommend
to its stockholders approval of the Merger. Approval of this Agreement by the
stockholders of the Company shall not restrict the ability of the Companys
board of directors thereafter to terminate or amend this Agreement to the
extent permitted by this Agreement and not prohibited under Section 251(d) of
the Delaware Corporation Law.
53
11E.
Notification
. Prior
to the Closing, each of Buyer and the Company shall promptly notify the other
parties hereto if such Person obtains actual knowledge that any of the
representations and warranties in this Agreement, the Company Disclosure Letter
or the Schedules hereto are not true and correct in all material respects, or
if such Person obtains actual knowledge of any material errors in, or omissions
from, the Company Disclosure Letter or the Schedules to this Agreement.
11F.
Consents
. Buyer
acknowledges that certain consents to the transactions contemplated by this
Agreement may be required from parties to contracts, leases, licenses or other
agreements to which the Company and/or its Subsidiaries is a party (including
the Company Material Contracts) and such consents have not been obtained and
may not be obtained. Buyer agrees that the holders of Company Capital Stock
shall not have any liability whatsoever to Buyer, Merger Sub or holders of
Buyer Common Stock arising out of or relating to the failure to obtain any
consents that may have been or may be required in connection with the
transactions contemplated by this Agreement or because of the default,
acceleration or termination of or loss of right under any such contract, lease,
license or other agreement as a result thereof. Buyer and Merger Sub further
agree that no representation, warranty or covenant of the Company contained
herein shall be breached or deemed breached as a result of the failure to
obtain any consents that may have been or may be required in connection with
the transactions contemplated by this Agreement or because of the default,
acceleration or termination of or loss of right under any such contract, lease,
license or other agreement as a result thereof, except to the extent that such
consent, default, acceleration, termination or loss was not set forth in
Section 7D
of the Company Disclosure Letter in breach of the representation and warranty
made in
Section 7D
hereof. The Company and Buyer shall cooperate in
any reasonable manner in connection with obtaining any such consents;
provided
that
such cooperation shall not include any requirement of any party or
any of its Affiliates to expend money, commence any litigation or offer or
grant any accommodation (financial or otherwise) to any third party.
11G.
Reasonable Best
Efforts
. Subject to the terms of this Agreement (including the
limitations set forth in this
Section 12G
), each of Buyer and the
Company shall use its reasonable best efforts to cause its conditions to
Closing to be satisfied and for the Closing to occur, including through
delivery of information and certificates to assist in the delivery of the
opinion of maritime counsel referenced in
Section 5A
. The reasonable
best efforts of the parties hereto shall not require any party or any of its
Subsidiaries, Affiliates or representatives to expend any money to remedy any
breach of any representation or warranty hereunder, to obtain any consent
required for consummation of the transactions contemplated hereby (other than
Buyer Shareholder Approval and Company Shareholder Approval, as applicable) or
to provide financing to any party for consummation of the transactions
contemplated hereby;
provided
that if any party, Affiliates or
representatives elects to remedy such breach, such party shall not be deemed to
be in breach of such representation or warranty, or in violation of any
covenant pursuant to
Section 6B
, for purposes of determining the
other parties obligations to consummate the transactions contemplated hereby
pursuant to
Section 5B
.
11H.
Regulatory Act
Compliance
. Buyer and the Company shall each file or cause to be filed, not
later than the second business day after receipt of Buyer Shareholder Approval,
any notifications or the like required to be filed under the HSR Act and other
anti-competition laws with respect to the transactions contemplated hereby. With
respect to filings under the HSR Act,
54
each of the
parties hereto shall seek early termination of the waiting period under the HSR
Act. Buyer and the Company shall use their respective best efforts to respond
to any requests for additional information made by any agencies and to cause
the waiting periods or other requirements under the HSR Act and all other
applicable anti-competition laws to terminate or expire at the earliest
possible date and (subject to the Companys rights under Section 9A above)
to resist in good faith, at each of their respective cost and expense
(including the institution or defense of legal proceedings), any assertion that
the transactions contemplated hereby constitute a violation of the antitrust
laws, all to the end of expediting consummation of the transactions
contemplated hereby. Each of Buyer and the Company shall consult with the other
prior to any meetings, by telephone or in person, with the staff of the Federal
Trade Commission, the United States Department of Justice or any other
regulatory agency, and each of Buyer and the Company shall have the right to
have a representative present at any such meeting. Each party shall promptly
notify the other parties hereto after becoming aware that any foreign antitrust
or similar approval is required for consummation of the transactions
contemplated hereby.
11I.
Director and
Officer Liability and Indemnification
. Buyer and its Subsidiaries
shall maintain in effect for six years from the Closing Date directors and
officers liability insurance covering those persons who are currently covered
by the Companys directors and officers liability insurance policy and the
Buyer D&O Policy on terms not less favorable than such existing insurance
coverage;
provided
that in the event that any claim is brought under any
such policy prior to the six year anniversary of the Closing Date, such
directors and officers liability insurance policy shall be maintained until
final disposition thereof.
11J.
Designation and
Replacement of Representatives
.
(i) The parties have agreed that it is
desirable to designate the Company Representative to act on behalf of holders
of the Company Capital Stock for certain limited purposes, as specified herein.
The parties have designated Madison Dearborn Capital Partners IV, L.P. as the
initial Company Representative, and approval of this Agreement by the holders
of Company Capital Stock shall constitute irrevocable ratification and approval
of such designation by the holders of Company Capital Stock. The Company
Representative may resign at any time, and the Company Representative may be
removed only by the vote of Persons which collectively owned more than 50% of
the Company Common Stock as of immediately prior to the Effective Time of the
Merger (
Company Majority Holders
). The designation of the Company
Representative is coupled with an interest, and, except as set forth in the
immediately preceding sentence, such designation is irrevocable and shall not
be affected by the death, incapacity, illness, bankruptcy, dissolution or other
inability to act of any of the holders of Company Capital Stock. In the event
that a Company Representative has resigned or been removed, a new Company
Representative shall be appointed by a vote of Company Majority Holders, such
appointment to become effective upon the written acceptance thereof by the new
Company Representative.
(ii) The parties have agreed that it is
desirable to designate the Buyer Representative to act on behalf of holders of
the Buyer Common Stock for certain limited purposes, as specified herein. The
parties have designated Terrapin Partners LLC as the initial Buyer
Representative, and approval of this Agreement by the holders of Buyer
55
Capital Stock
shall constitute irrevocable ratification and approval of such designation by
the holders of Buyer Capital Stock. The Buyer Representative may resign at any
time, and the Buyer Representative may be removed only by the vote of Persons
which collectively owned more than 50% of the Buyer Common Stock as of
immediately prior to the Effective Time of the Merger (
Buyer Majority
Holders
). The designation of the Buyer Representative is coupled with an
interest, and, except as set forth in the immediately preceding sentence, such
designation is irrevocable and shall not be affected by the death, incapacity,
illness, bankruptcy, dissolution or other inability to act of any of the
holders of Buyer Capital Stock. In the event that a Buyer Representative has
resigned or been removed, a new Buyer Representative shall be appointed by a
vote of Buyer Majority Holders, such appointment to become effective upon the
written acceptance thereof by the new Buyer Representative.
11K.
Authority and
Rights of Representatives; Limitations on Liability
.
(i) The Company Representative shall
have such powers and authority as are necessary or appropriate to carry out the
functions assigned to it under this Agreement and in any other document
delivered in connection herewith (including the Adjustment Escrow Agreement);
provided
,
however
, that the Company Representative will have no obligation to act
on behalf of the holders of Company Capital Stock. All actions, notices,
communications and determinations by the Company Representative to carry out
such functions shall conclusively be deemed to have been authorized by, and
shall be binding upon, the holders of Company Capital Stock. Neither the
Company Representative nor any of its officers, directors, employees, agents or
representatives will have any liability to the Company, Buyer, the Surviving
Company or the holders of Company Capital Stock with respect to actions taken
or omitted to be taken by the Company Representative in such capacity (or any
of its officers, directors, employees, agents or representatives in connection
therewith), except with respect to the Company Representatives gross
negligence or willful misconduct. The Company Representative will at all times
be entitled to rely on any directions received from the Company Majority
Holders;
provided
,
however
, that the Company Representative shall
not be required to follow any such direction, and shall be under no obligation
to take any action in its capacity as Company Representative based upon any
such direction. The Company Representative shall be entitled to engage such
counsel, experts and other agents and consultants as it shall deem necessary in
connection with exercising its powers and performing its function hereunder and
(in the absence of bad faith on the part of the Company Representative) shall
be entitled to conclusively rely on the opinions and advice of such Persons. The
Company Representative (for itself and its officers, directors, employees,
agents and representatives) shall be entitled to full reimbursement for all
reasonable expenses, disbursements and advances (including fees and
disbursements of its counsel, experts and other agents and consultants)
incurred by the Company Representative in such capacity (or any of its
officers, directors, employees, agents or representatives in connection
therewith), and to full indemnification against any loss, liability or expenses
arising out of actions taken or omitted to be taken in its capacity as Company
Representative (except for those arising out of the Company Representatives
gross negligence or willful misconduct), including, without limitation, the
costs and expenses of investigation and defense of claims, from the Buyer and
the Surviving Company (or any successor thereto
56
pursuant to
the Post-Closing Mergers). In furtherance of the foregoing, the Company
Representative shall have the power and authority to set aside and retain
additional funds paid to or received by it to satisfy such obligations
(including to establish such reserves as the Company Representative determines
in good faith to be appropriate for such costs and expenses that are not then
known or determinable). The relationship created herein is not to be construed
as a joint venture or any form of partnership between or among the Company
Representative or any holder of Company Capital Stock for any purpose of U.S.
federal or state law, including without limitation, federal or state income tax
purposes. Neither the Company Representative nor any of its Affiliates owes any
fiduciary or other duty to any holder of Company Capital Stock.
(ii) The Buyer Representative shall have
such powers and authority as are necessary or appropriate to carry out the
functions assigned to it under this Agreement and in any other document
delivered in connection herewith (including the Adjustment Escrow Agreement);
provided
,
however
, that the Buyer Representative will have no obligation to act on
behalf of the holders of Buyer Common Stock. All actions, notices,
communications and determinations by the Buyer Representative to carry out such
functions shall conclusively be deemed to have been authorized by, and shall be
binding upon, the holders of Buyer Common Stock. Neither the Buyer
Representative nor any of its officers, directors, employees, agents or
representatives will have any liability to the Buyer, the Surviving Company or
the holders of Buyer Common Stock with respect to actions taken or omitted to
be taken by the Buyer Representative in such capacity (or any of its officers,
directors, employees, agents or representatives in connection therewith),
except with respect to the Buyer Representatives gross negligence or willful
misconduct. The Buyer Representative shall be entitled to engage such counsel,
experts and other agents and consultants as it shall deem necessary in
connection with exercising its powers and performing its function hereunder and
(in the absence of bad faith on the part of the Buyer Representative) shall be
entitled to conclusively rely on the opinions and advice of such Persons. The
Buyer Representative (for itself and its officers, directors, employees, agents
and representatives) shall be entitled to full reimbursement for all reasonable
expenses, disbursements and advances (including fees and disbursements of its
counsel, experts and other agents and consultants) incurred by the Buyer
Representative in such capacity (or any of its officers, directors, employees,
agents or representatives in connection therewith), and to full indemnification
against any loss, liability or expenses arising out of actions taken or omitted
to be taken in its capacity as Buyer Representative (except for those arising
out of the Buyer Representatives gross negligence or willful misconduct),
including, without limitation, the costs and expenses of investigation and
defense of claims, from the Buyer and the Surviving Company. The relationship
created herein is not to be construed as a joint venture or any form of
partnership between or among the Buyer Representative or any holder of Buyer
Common Stock for any purpose of U.S. federal or state law, including without
limitation, federal or state income tax purposes. Neither the Buyer
Representative nor any of its Affiliates owes any fiduciary or other duty to
any holder of Buyer Common Stock.
11L.
Provision
Respecting Representation of Company
. Each of the parties to this
Agreement hereby agrees, on its own behalf and on behalf of its directors,
members, partners, officers, employees and Affiliates, that Kirkland &
Ellis LLP may serve as counsel to each and
57
any of the
Company Representative and holders of Company Capital Stock and their
respective Affiliates (individually and collectively, the
Seller Group
),
on the one hand, and the Company and its Subsidiaries, on the other hand, in
connection with the negotiation, preparation, execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby, and
that, following consummation of the transactions contemplated hereby, Kirkland &
Ellis LLP (or any successor) may serve as counsel to the Seller Group or any
director, member, partner, officer, employee or Affiliate of the Seller Group,
in connection with any litigation, claim or obligation arising out of or
relating to this Agreement or the transactions contemplated by this Agreement
notwithstanding such representation or any continued representation of the
Company and/or any of its Subsidiaries, and each of the parties hereto hereby
consents thereto and waives any conflict of interest arising therefrom, and
each of such parties shall cause any Affiliate thereof to consent to waive any
conflict of interest arising from such representation.
11M.
Expenses; Transfer
Taxes
. If this Agreement is terminated prior to consummation of the
Closing, each party shall pay all fees and expenses incurred by such party in
connection with this Agreement and the transactions contemplated hereby or
otherwise required by applicable law. If the Closing occurs, the Buyer and the
Surviving Company shall pay, or cause to be paid, all fees and expenses
incurred by the parties in connection with this Agreement and the transactions
contemplated hereby or otherwise required by applicable law, all property,
transfer or similar taxes imposed on the Company or its Subsidiaries and any
transfer or similar tax imposed on any holder of Company Capital Stock or Buyer
Common Stock resulting from the transactions contemplated hereby.
11N.
Post-Closing
Mergers and Transactions
.
(i) Promptly after the date hereof, and
in any event in advance of filing the Joint Prospectus / Proxy Statement, Buyer
shall (A) form a corporation under the laws of the State of Delaware (
Holdco
)
which at all times prior to the Effective Time shall have only one class and
series of capital stock issued and outstanding, being common stock, par value
$0.0001 per share (
Holdco Common Stock
), all of which shares of Holdco
Common Stock shall be owned beneficially and of record by Buyer and (B) cause
Holdco to form a limited liability company under the laws of the State of
Delaware (
Holdco Merger Sub
) which at all times prior to the Effective
Time shall have only one class and series of membership units issued and
outstanding, being common units (
Holdco Merger Sub Common Units
), all
of which Holdco Merger Sub Common Units shall be owned beneficially and of
record by Holdco. Promptly after formation (and in any event prior to Closing),
Buyer shall cause Holdco to execute and deliver to Buyer a joinder agreement in
form and substance reasonably satisfactory to the Company agreeing to the
obligations of Holdco hereunder. At all times prior to Closing, Buyer shall
cause each of Holdco and Holdco Merger Sub (a) not to own or acquire any
equity interests or securities in any other Person (other than Holdcos equity
interest in Holdco Merger Sub), (b) not to incur any liabilities, other
than liabilities incidental to the existence of Holdco and Holdco Merger Sub
and liabilities related to the Joint Prospectus/Proxy Statement, (c) not
to enter into any contracts or commitments (other than as may be set forth in
this Agreement), or (d) not to issue or agree to issue any capital stock
or equity securities or rights to acquire capital stock or other equity
interests of Holdco or Holdco Merger Sub (other than to Buyer or Holdco, respectively).
Prior to Closing, Buyer shall take such
action such that
58
at the
Effective Time, (i) the Holdco Certificate of Incorporation is
substantially in the form of
Exhibit G
attached hereto (the
Holdco
Certificate of Incorporation
), (ii) the Holdco Bylaws are
substantially in the form of
Exhibit H
attached hereto (the
Holdco
Bylaws
), (iii) the Buyer Post-Closing Directors comprise all of the
directors of Holdco until their death, resignation or removal in accordance
with the Holdco Certificate of Incorporation and Holdco Bylaws, and (iv) the
officers of GLDD are the officers of Holdco and Holdco Merger Sub until their
death, resignation or removal in accordance with the Holdco Certificate of
Incorporation and Holdco Bylaws.
(ii) Immediately after the Effective Time,
Buyer and Holdco Merger Sub shall take such action such that (A) Buyer
shall merge with and into Holdco Merger Sub (the
Holdco Merger
), (B) as
a consequence of the Holdco Merger, each share of Holdco Common Stock owned by
Buyer is cancelled, (C) as a consequence of the Holdco Merger, each Holdco
Merger Sub Common Unit shall remain outstanding as one common unit of the
surviving company of the Holdco Merger (all of which are owned by Holdco), and (D) as
a consequence of the Holdco Merger, at the effective time of the Holdco Merger
(which shall be upon filing of the certificate of merger for the Holdco
Merger), each share of Buyer Common Stock shall automatically convert into one
fully-paid, non-assessable share of Holdco Common Stock. Prior to Closing, the
Buyers board of directors shall approve the Holdco Merger and submit it to the
holders of Buyer Common Stock for approval as part of the Joint
Prospectus/Proxy Statement and Buyer shall take all other such actions, in each
case in form and substance reasonably satisfactory to the Company, such that,
other than Buyer Shareholder Approval, no further corporate or limited
liability company approval is required on the part of Buyer or Holdco Merger
Sub for consummation of the Holdco Merger. Buyer shall comply with Section 262
of the Delaware Corporation Law with respect to the Holdco Merger.
(iii) As promptly as possible after the
Effective Time and the consummation of the Holdco Merger, Holdco shall cause (A) the
surviving company of the Holdco Merger (i..e., Holdco Merger Sub) to merge with
and into Holdco (i.e., such that immediately thereafter the Surviving Company
is a direct wholly-owned Subsidiary of Holdco), (B) the Surviving Company
to merge with and into Holdco (i.e., such that immediately thereafter GLDD is a
direct wholly-owned Subsidiary of Holdco), and (C) GLDD to merge with and
into Holdco under the laws of the State of Delaware (the mergers described in (A) through
(C), together with the Holdco Merger, the
Post-Closing Mergers
);
provided
that notwithstanding the foregoing, in the event that the Post-Closing Mergers
described in clauses (A) through (C) foregoing require consents or
amendments from all or certain of the counterparties to the Senior Credit
Agreement, Equipment Facility and/or Underwriting Agreement or other Persons,
the parties shall not be obligated to complete such Post-Closing Mergers unless
and until the requisite consents and/or amendments are obtained (and, to the
extent not obtained prior to Closing, the Surviving Company shall use
reasonable best efforts to obtain such consents and/or amendments as promptly
as practicable after the Closing);
provided
further that, without
limiting the immediately foregoing proviso, in the event that the Post-Closing
Merger described in clause (C) of this
Section 11N(iii)
(the
GLDD Merger
) may not be completed without violation of the Indenture,
Buyer shall not be obligated to complete the GLDD Merger until the soonest date
that the GLDD Merger can be completed
59
without
violation of the Indenture. Holdco shall cause the Holdco Certificate of
Incorporation and the Holdco Bylaws, in the respective forms attached as
Exhibit G
and
Exhibit H
hereto, to be (subject to amendments or modifications
thereto arising after the Effective Time based on votes taken after the
Effective Time) the certificate of incorporation and bylaws of the surviving
company, and the officers and directors of Holdco as of immediately prior to
the effective time of each Post-Closing Merger described in clauses (A), (B) and
(C) of this
Section 11N(iii)
, to be the officers and directors
of the surviving company in such Post-Closing Mergers. Prior to completion of
the GLDD Merger, Holdco shall contribute all cash on hand of Holdco or any of
its Subsidiaries (including all cash contributed from the Trust Fund not
otherwise to be used to satisfy claims for Conversion Rights) to GLDD and its
Subsidiaries for repayment of debt for borrowed money, payment of fees and
expenses related to the transactions contemplated hereby and for such general
corporate and working capital purposes as the Board of Directors of GLDD may
determine.
(iv) Buyer (A) shall take such actions
such that at all times from their formation until completion of the
transactions described in
Section 11N(iii)
neither Merger Sub
nor Holdco Merger Sub is treated as a corporation for United States federal
income tax purposes and (B) shall not make (and shall not permit any of
its Subsidiaries to make) any election to have Merger Sub or Holdco Merger Sub
treated as a corporation for United States federal income tax purposes.
11O.
Conversion Rights
. Buyer
shall take such action such that each issued and outstanding share of Buyer
Common Stock that is held by a Person who has not voted in favor of the Merger
and who, in accordance with the Buyer Charter Documents, has exercised and not
withdrawn his, her or its right to convert his, her or its share of Buyer
Common Stock into cash upon completion of the Merger shall be paid from the
Trust Fund the portion of the Trust Fund to which such holder is entitled, as
determined in accordance with the Buyer Charter Documents. The rights of a
holder of Buyer Common Stock to convert his, her or its Buyer Common Stock into
cash in accordance with Section B of Article Sixth of Buyers
certificate of incorporation is referred to herein as
Conversion Rights
. Buyer shall take such actions within its
control and not in contravention of the Buyer Charter Documents or applicable
law such that shares of Buyer Common Stock in respect of which Conversion
Rights have been exercised shall from and after the Effective Time represent
only the right to receive the portion of the Trust Fund to which such holder is
entitled, as determined in accordance with the Buyer Charter Documents.
ARTICLE 12
MISCELLANEOUS
12A.
Amendment and
Waiver
. Subject to applicable law, this Agreement may be amended or
any provision of this Agreement may be waived;
provided
that
any
amendment or waiver shall be binding only if such amendment or waiver is set
forth in a writing executed by the party against whom enforcement is sought. Any
amendments or waivers under this Agreement following the Closing shall require
the prior written consent of the Company Representative. No course of dealing
between or among any Persons having any interest in this Agreement shall be
deemed effective to modify, amend or discharge any part of this Agreement or
any rights or obligations of any person under or by reason of this Agreement.
60
12B.
Notices
. All
notices, demands and other communications to be given or delivered under or by
reason of the provisions of this Agreement shall be in writing and shall be
deemed to have been given (i) if personally delivered, on the date of
delivery, (ii) if delivered by express courier service of national
standing (with charges prepaid), on the business day following the date of
delivery to such courier service, (iii) if delivered by facsimile, upon
confirmation of receipt, or (iv) if deposited in the United States mail,
first-class postage prepaid, on the fifth business day following the date of
such deposit. Notices, demands and communications to the Company, the Company
Representative or Buyer shall, unless another address is specified in writing
pursuant to the provisions hereof, be sent to the address indicated below:
Notices to the Company
(prior to Closing) and/or the Surviving Company (after Closing)
:
GLDD Acquisitions
Corp.
2122 York Road
Oak Brook, Illinois 60523
Attention: Chief Executive Officer
Chief Financial
Officer
Telecopy: (630) 574-3007
with a copy to:
Kirkland &
Ellis LLP
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Richard J. Campbell
Telecopy: (312) 861-2200
Notices to the
Company Representative:
Madison Dearborn
Capital Partners IV, L.P.
Three First National Plaza
Suite 3800
Chicago, Illinois 60602
Attn: Samuel M. Mencoff
Thomas S. Souleles
Telecopy: (312) 895-1001
and a copy to:
Kirkland &
Ellis LLP
200 East Randolph Drive
Chicago, Illinois 60601
Attention: Richard J. Campbell
Telecopy: (312) 861-2200
61
Notices to Buyer
(prior to September 4, 2006):
Aldabra
Acquisition Corporation
c/o Terrapin Partners LLC
Rockefeller Center
620 Fifth Avenue, 3rd Floor
New York, NY 10020
Attention: Jason Weiss
Telecopy: (212) 332-3565
(from and after September 4,
2006)
Aldabra
Acquisition Corporation
c/o Terrapin Partners LLC
540 Madison Avenue
New York, NY 10022
Attention: Jason Weiss
Telecopy: 310-459-5822
with a copy to:
Sidley Austin LLP
787 Fifth Avenue
New York, NY 10019
Attention: Jack I. Kantrowitz
Telecopy: 212-839-5599
12C.
Assignment
. This
Agreement and all of the provisions hereof shall be binding upon and inure to
the benefit of the parties hereto and their respective heirs, successors and
permitted assigns;
provided
that
neither this Agreement nor any
of the rights, interests or obligations hereunder shall be assigned (including
by operation of law) by any party without the consent of the other parties
hereto. For all purposes hereof, a transfer, sale or disposition of a majority
of the voting capital stock or other voting interests of any party (whether by
contract or otherwise) shall be deemed an assignment hereunder.
12D.
Severability
. Whenever
possible, each provision of this Agreement shall be interpreted in such manner
as to be effective and valid under applicable law, but if any provision of this
Agreement is held to be prohibited by or invalid under applicable law, such
provision shall be ineffective only to the extent of such prohibition or
invalidity, without invalidating the remainder of such provisions or the
remaining provisions of this Agreement. Notwithstanding the foregoing, to the
extent that a representation or warranty of the Company contained in this
Agreement, the Company Disclosure Letter or any Schedules hereto (each, a
Representation
)
addresses a particular issue with specificity (a
Specific Representation
),
and no breach by the Company exists under such Specific Representation, the
Company shall not be deemed to be in breach of any other Representation (with
respect to such issue) that addresses such issue with less specificity than the
Specific Representation and if such Specific Representation is qualified or limited
by the Companys knowledge, or in any other manner, no other Representation
shall
62
supersede or
limit such qualification in any manner. Without limiting the generality of the
foregoing, no representation or warranty regarding or relating to (i) Tax matters
is being made, except as set forth in
Section 7H
, (ii) employee
benefit matters is being made, except as set forth in
Section 7M
,
or (iii) environmental matters is being made, except as set forth in
Section 7E
,
Section 7G(1)(a)
or
Section 7P
.
12E.
No Strict
Construction
. Notwithstanding the fact that this Agreement has been
drafted or prepared by one of the parties, each of Buyer and the Company
confirm that they and their respective counsel have reviewed, negotiated and
adopted this Agreement as the joint agreement and understanding of the parties
hereto and the language used in this Agreement shall be deemed to be the
language chosen by the parties hereto to express their mutual intent, and no rule of
strict construction shall be applied against any Person.
12F.
Captions
. The
captions used in this Agreement and descriptions of the Company Disclosure
Letter and Schedules are for convenience of reference only and do not
constitute a part of this Agreement and shall not be deemed to limit,
characterize or in any way affect any provision of this Agreement, and all
provisions of this Agreement shall be enforced and construed as if no caption
or description of the Company Disclosure Letter or Schedules had been used in
this Agreement.
12G.
Complete Agreement
. Except
for the Confidentiality Agreement, this Agreement and the other agreements
executed on the date hereof contain the complete agreement between the parties
and supersede any prior understandings, agreements or representations by or
between the parties, written or oral, which may have related to the subject
matter hereof in any way.
12H.
Company Disclosure
Letter
.
(i) The disclosures in the Company
Disclosure Letter are to be taken as relating to the representations and
warranties of the Company as a whole, notwithstanding the fact that the Company
Disclosure Letter is arranged by sections corresponding to the sections in this
Agreement or that a particular section of this Agreement makes reference to a
specific section of the Company Disclosure Letter and notwithstanding that a
particular representation and warranty may not make a reference to the Company
Disclosure Letter. The inclusion of information in the Company Disclosure
Letter shall not be construed as an admission that such information is material
to any of the Company or its Subsidiaries. In addition, matters reflected in
the Company Disclosure Letter are not necessarily limited to matters required
by this Agreement to be reflected in the Company Disclosure Letter. Such
additional matters are set forth for informational purposes only and do not
necessarily include other matters of a similar nature. Neither the
specifications of any dollar amount in any representation, warranty or covenant
contained in this Agreement nor the inclusion of any specific item in the Company
Disclosure Letter is intended to imply that such amount, or higher or lower
amounts, or the item so included or other items, are or are not material, and
no party shall use the fact of the setting forth of any such amount or the
inclusion of any such item in any dispute or controversy between the parties as
to whether any obligation, item or matter not described herein or included in
the Company Disclosure Letter is or is not material for purposes of this
Agreement. Further, neither the specification of any item or
63
matter in any
representation, warranty or covenant contained in this Agreement nor the
inclusion of any specific item in the Company Disclosure Letter is intended to
imply that such item or matter, or other items or matters, are or are not in
the ordinary course of business, and no party shall use the fact of setting
forth or the inclusion of any such items or matter in any dispute or
controversy between the parties as to whether any obligation, item or matter
not described herein or included in the Company Disclosure Letter is or is not
in the ordinary course of business for purposes of this Agreement.
(ii) Prior to the Closing, the Company
shall have the right to supplement, modify or update the Company Disclosure
Letter with respect to the representations and warranties in Article 7
hereof for matters first arising after the date of this Agreement or, with
respect to representations and warranties qualified by the Companys knowledge,
for matters of which the Company first obtains knowledge after the date hereof,
to ensure the correctness thereof. Any such supplements, modifications and
updates shall not be deemed made for purposes of determining satisfaction of
the condition to Closing in
Section 5B(i)
hereof. From and
after the Closing, references to the Company Disclosure Letter shall be
references to the Company Disclosure Letter as so supplemented, modified and/or
updated.
(iii) Prior to the Closing, the Buyer shall
have the right, by written notice to the Company, to provide written notice of
any updates or changes with respect to the representations and warranties in Article 8
hereof for matters first arising after the date of this Agreement or, with
respect to representations and warranties qualified by the Buyers knowledge,
for matters of which the Company first obtains knowledge after the date hereof,
to ensure the correctness thereof. Any such supplements, modifications and
updates shall not be deemed made for purposes of determining satisfaction of
the condition to Closing in
Section 5C(i)
hereof. From and
after the Closing, references to the representations and warranties made in
Article 8
shall be deemed qualified by the matters addressed in any such written notice.
12I.
No Additional
Representations; Disclaimer
.
(i) Each party acknowledges and agrees
that neither the other parties hereto, nor any Person acting on behalf of any
party hereto or any of their respective Affiliates or representatives has made
any representation or warranty, express or implied, as to the accuracy or
completeness of any information regarding such party or any of its Subsidiaries
or their respective businesses or assets, except as expressly set forth in this
Agreement or as and to the extent required by this Agreement to be set forth in
the Company Disclosure Letter.
(ii) Each party acknowledges and agrees
that except for the representations and warranties expressly set forth in
Article 7
and
Article 8
hereof, the Merger is being consummated AS IS WITHOUT
ANY IMPLIED WARRANTY OF MERCHANTABILITY OR FITNESS FOR INTENDED USE OR OTHER
EXPRESSED OR IMPLIED WARRANTY. Each party acknowledges and agrees that it is
consummating the Merger without any representation or warranty, express or
implied,
64
by the other
parties hereto or any of their Affiliates or representatives except for the
representations and warranties expressly set forth in
Article 7
and
Article 8
hereof.
12J.
Counterparts
. This
Agreement may be executed in multiple counterparts (including by means of
telecopied or electronically transmitted signature pages), all of which taken
together shall constitute one and the same Agreement.
12K.
Governing Law
. The
internal law (and not the law of conflicts) of the State of New York shall
govern all questions concerning the construction, validity and interpretation
of this Agreement and the performance of the obligations imposed by this
Agreement, except that as to matters governing the procedures, validity and
effect of the Merger the Delaware Corporation Law shall apply.
12L.
CONSENT TO
JURISDICTION
. THE PARTIES AGREE THAT JURISDICTION AND VENUE IN ANY
ACTION BROUGHT BY ANY PARTY PURSUANT TO THIS AGREEMENT SHALL PROPERLY AND
EXCLUSIVELY LIE IN ANY FEDERAL OR STATE COURT LOCATED IN CHICAGO, ILLINOIS. EACH
PARTY ALSO AGREES NOT TO BRING ANY ACTION ARISING OUT OF OR RELATING TO THIS
AGREEMENT IN ANY OTHER COURT. BY EXECUTION AND DELIVERY OF THIS AGREEMENT, EACH
PARTY IRREVOCABLY SUBMITS TO THE JURISDICTION OF SUCH COURTS FOR ITSELF AND IN
RESPECT OF ITS PROPERTY WITH RESPECT TO SUCH ACTION. THE PARTIES IRREVOCABLY
AGREE THAT VENUE WOULD BE PROPER IN SUCH COURT, AND HEREBY WAIVE ANY OBJECTION
THAT SUCH COURT IS AN IMPROPER OR INCONVENIENT FORUM FOR THE RESOLUTION OF SUCH
ACTION. THE PARTIES FURTHER AGREE THAT THE MAILING BY CERTIFIED OR REGISTERED
MAIL, RETURN RECEIPT REQUESTED, OF ANY PROCESS REQUIRED BY ANY SUCH COURT SHALL
CONSTITUTE VALID AND LAWFUL SERVICE OF PROCESS AGAINST THEM, WITHOUT NECESSITY
FOR SERVICE BY ANY OTHER MEANS PROVIDED BY STATUTE OR RULE OF COURT.
12M.
Interpretation
. When
used herein, including means including, without limitation and the
masculine includes the feminine and vice versa. Any reference to any agreement
or contract referenced herein, in the Company Disclosure Letter or in any
Schedule shall be a reference to such agreement or contract, as amended,
modified, supplemented or waived. Each party agrees that all amounts required
to be paid hereunder shall be paid in United States currency without discount,
rebate or reduction and subject to no counterclaim or offset (other than
withholding tax obligations required to be withheld by law), on the dates
specified herein (with time being of the essence). A business day shall be
any day, other than a Saturday, Sunday, or any other date in which banks
located in any of New York, New York or Chicago, Illinois are closed for
business as a result of federal, state or local holiday.
12N.
Third-Party
Beneficiaries and Obligations
. This Agreement shall inure to the
benefit of and be binding upon the parties hereto and their respective
successors and permitted assigns. Nothing in this Agreement, express or
implied, is intended to or shall confer upon any Person other than the parties
hereto or their respective successors and permitted assigns, any rights,
remedies or liabilities under or by reason of this Agreement.
65
12O.
Specific
Performance
. Each party acknowledges that in the event of a breach of
this Agreement by any party hereto, money damages may be inadequate and the
other parties may have no adequate remedy at law. Accordingly, each party
agrees that the other parties shall have the right, in addition to any other
rights and remedies existing in its favor, to enforce its rights and the
obligations of the other parties hereto not only by an action or actions for
damages but also by an action or actions for specific performance, injunctive
and/or other equitable relief. If any such action is brought to enforce this
Agreement, each party hereby waives the defense that there is an adequate
remedy at law.
* *
* *
66
IN WITNESS WHEREOF, the parties hereto have executed
this Agreement and Plan of Merger as of the date first written above.
|
GLDD ACQUISITIONS CORP.
|
|
|
|
|
|
|
|
/s/
|
Douglas B. Mackie
|
|
|
|
By:
|
Douglas B. Mackie
|
|
|
|
Its:
|
President and CEO
|
|
|
|
|
|
|
|
|
ALDABRA ACQUISITION
CORPORATION
|
|
|
|
|
|
|
|
|
/s/
|
Nathan Leight
|
|
|
|
|
By:
|
Nathan Leight
|
|
|
|
|
Its:
|
Chairman
|
|
|
|
|
|
|
|
|
|
|
ALDABRA MERGER SUB, L.L.C.
|
|
|
|
|
|
|
|
|
/s/
|
Jason Weiss
|
|
|
|
|
By:
|
Jason Weiss
|
|
|
|
|
Its:
|
CEO
|
|
|
|
|
|
|
|
|
|
|
MADISON DEARBORN CAPITAL
PARTNERS IV, L.P.
|
|
|
(solely in its capacity as the Company
Representative)
|
|
|
|
|
|
|
By:
|
Madison Dearborn Partners
IV, L.P.
|
|
|
Its:
|
General Partner
|
|
|
|
|
|
|
|
|
|
|
By:
|
Madison Dearborn Partners,
L.L.C.
|
|
|
Its:
|
General Partner
|
|
|
|
|
|
|
|
|
|
|
/s/
|
Thomas S. Souleles
|
|
|
|
|
By:
|
Thomas S. Souleles
|
|
|
|
|
Its:
|
General Partner
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
[SIGNATURE PAGE TO AGREEMENT AND PLAN OF MERGER]
|
TERRAPIN PARTNERS LLC
|
|
(solely in its capacity as
Buyer Representative)
|
|
|
|
|
|
|
/s/
|
Jason Weiss
|
|
|
By:
|
Jason Weiss
|
|
|
Its:
|
Manager
|
|
|
|
|
|
|
|
|
|