relationships with suppliers, employees, tenants, licensees and all other Persons with which the Company has significant business relations. Between the date of this Agreement and the Effective Time, except as otherwise expressly contemplated by this Agreement, neither the Company, any Company Subsidiary nor any Nonprofit Organization will without the prior written consent of Acquiror (which consent will not be unreasonably withheld or delayed; provided, however, that Acquiror will be entitled to take into account its plans for the Company after the Closing Date in determining whether or not to grant such consent):
(a) purchase, redeem or otherwise acquire its capital stock, or issue, grant, sell, transfer, authorize or encumber any shares of capital stock, or securities convertible into or exchangeable for, or options, warrants, calls, commitments or rights of any kind to acquire, any shares of any class or series of its capital stock, or enter into any agreement, understanding or arrangement with respect to the voting of its capital stock; provided, however, that Acquiror hereby consents to the issuance of the Change in Control Shares after the date of this Agreement and at or before the Closing Date;
(b) (i) increase the compensation payable or to become payable to or fringe benefits of any current or former directors, officers, employees, independent contractors or consultants of the Company, the Company Subsidiaries or the Nonprofit Organizations (collectively, "Company Personnel"), except for increases in salary or wages in the Ordinary Course of Business to employees who are not executive officers or directors or the payment of accrued but unpaid bonuses, (ii) grant new bonuses or grant any severance or termination or transition pay to Company Personnel, (iii) establish, adopt or enter into, amend or terminate any Benefit Plan or any plan, agreement, arrangement, program, policy, trust, fund or other arrangement that would be a Benefit Plan if it were in existence as of the date of this Agreement (except as may be required by applicable Law), (iv) hire, or enter any agreement to hire, any employee on a full-time, part-time (other than temporary employees hired in the Ordinary Course of Business), consulting or other basis for annual compensation in excess of $25,000 or (v) enter into, renew, extend, amend, modify, terminate, cancel, waive, release or assign any employment or independent contractor agreements with any current employees of the Company or any Company Subsidiary or Nonprofit Organization;
(c) (i) alter through merger, liquidation, reorganization, restructuring or in any other fashion the corporate structure, management structure or, if applicable, ownership of the Company, any Company Subsidiary or any Nonprofit Organization, (ii) acquire or agree to acquire (by merger, consolidation, acquisition of assets or otherwise) any Person or material assets, or any voting or non-voting equity securities or similar ownership interests in any Person, (iii) split, combine, subdivide or reclassify any shares of any class or series of its capital stock or (iv) declare, set aside, make or pay any dividend or make other distribution payable in cash, stock, property or otherwise to holders of any class or series of its capital stock;
(d) enter into, renew, extend or amend or modify in any material respect or terminate, cancel, waive, release or assign any contract or agreement which is or, if applicable, would be a Material Contract;
(e) except as disclosed in the Company's, the Company Subsidiaries' and the Nonprofit Organizations' capital expenditure budgets for the current fiscal year, true, correct and
complete copies of which have been provided to Acquiror, commit to any capital expenditures in excess of the Material Amount;
(f) manage the working capital of the Company, the Company Subsidiaries and the Nonprofit Organizations (including, but not limited to, accounts receivable and accounts payable) outside of the Ordinary Course of Business;
(g) make any loans, any advances (other than travel advances to employees in the Ordinary Course of Business) or any capital contributions to, or any investments in, any other Person;
(h) (i) incur or modify Indebtedness owed by the Company, any Company Subsidiary or any Nonprofit Organization, guarantee any Indebtedness of another Person or cancel any Indebtedness or other obligation owed to the Company, any Company Subsidiary or any Nonprofit Organization, (ii) redeem, repurchase, prepay or otherwise acquire any Indebtedness of the Company, any Company Subsidiary or any Nonprofit Organization or (iii) enter into hedging, swap or factoring arrangements or contracts or other similar financing instruments;
(i) amend any provisions of the articles of incorporation or bylaws or other organizational documents of the Company, any Company Subsidiaries or any Nonprofit Organizations;
(j) transfer, lease, license, sublicense, assign, sell, sublease, mortgage, pledge, or otherwise dispose of, in whole or in part, or incur or subject any Encumbrance on, any property or assets, (including, without limitation, any interest in any Real Property), in each case other than in the Ordinary Course of Business, or amend in any material respect, extend or terminate any Real Property Lease;
(k) other than with respect to purchase orders in the Ordinary Course of Business, make any payments in excess of the Material Amount or incur any commitment in excess of the Material Amount;
(l) | commence, undertake or engage in any new line of business; |
(m) permit any insurance policy or arrangement naming or providing for the Company, any Company Subsidiary or any Nonprofit Organization as a beneficiary or a loss payable payee to be cancelled or terminated or impaired in any way;
(n) settle, dismiss, compromise, or commence any Action threatened against, relating to or involving the Company, any Company Subsidiary or any Nonprofit Organization in connection with any business, asset or property of the Company, any Company Subsidiary or any Nonprofit Organization, or waive, assign or release any material rights or claims;
(o) enter into any transaction, agreement, arrangement or understanding between (i) the Company, any Company Subsidiary or any Nonprofit Organization, on the one hand, and (ii) any other Affiliate of the Company, on the other hand, of the type that would be required to be disclosed under Item 404 of Regulation S-K;
(p) take any action that is intended or may reasonably be expected to result in any of its representations and warranties set forth in this Agreement being or becoming untrue in any material respect, or in any of the conditions to the Cash Merger set forth in Article VII hereof being satisfied or in a violation of any provision of this Agreement;
(q) (i) make any Tax election or change any method of accounting, (ii) enter into any settlement or compromise of any Tax liability, (iii) file any amended Tax Return with respect to any Tax, (iv) change any annual Tax accounting period, (v) enter into any closing agreement relating to any Tax, (vi) surrender any right to claim a material Tax refund or (vi) take any action or enter into any agreement that would jeopardize the Tax exemption of any of the Nonprofit Organizations;
(r) fail to timely satisfy or cause to be timely satisfied all applicable Tax reporting and filing requirements contained in the Code with respect to the transactions contemplated by this Agreement;
(s) make any changes in accounting policies or procedures other than in the Ordinary Course of Business and other than as required by GAAP or a Governmental Authority;
(t) except to the extent necessary to take any actions that the Company, the Company Subsidiaries or the Nonprofit Organizations are otherwise permitted to take pursuant to Section 6.7 (and in such case only in accordance with the terms of Section 6.7), waive any of its rights under, or release any other party from, amend, or fail to enforce its rights under, any standstill provision of any agreement;
(u) fail to timely file any SEC Reports required to be filed pursuant to the Exchange Act prior to the Effective Time; or
(v) enter into any agreement, contract, commitment, understanding or arrangement to do any of the foregoing, or authorize, recommend, propose or announce an intention to take any of the actions described in Sections 6.1(a) through 6.1(v).
6.2. Advice of Changes; Filing. The Company will confer with Acquiror and report on operational matters and other matters as requested by Acquiror. The Company and Acquiror will each promptly provide the other with copies of all filings made by such party with any Governmental Entity in connection with this Agreement and the transactions contemplated hereby.
6.3 Shareholders Meeting. As promptly as practicable following the date of this Agreement, the Company, acting through its Board of Directors, and in accordance with applicable Law, will (i) duly call, give notice of, convene and hold a meeting of its shareholders for the purpose of approving this Agreement and the transactions contemplated hereby (including any postponements or adjournments thereof, the "Shareholders Meeting") and (ii) (A) include the Board Recommendation in the Proxy Statement and (B) use its reasonable best efforts to obtain the necessary approval of this Agreement and the transactions contemplated by this Agreement by the shareholders of the Company.
(a) As promptly as practicable following the date of this Agreement, the Company will, with the assistance and approval of Acquiror, prepare and mail the proxy statement to be sent to the shareholders of the Company in connection with the Shareholders Meeting (such proxy statement, as amended or supplemented, the "Proxy Statement"). Acquiror and the Company will cooperate with each other in the preparation of the Proxy Statement. Without limiting the generality of the foregoing, (i) the Company will provide Acquiror with a reasonable opportunity to review and comment on the Proxy Statement and (ii) Acquiror will furnish to the Company the information relating to it required by the Exchange Act to be set forth in the Proxy Statement. The Company will cause the Proxy Statement to comply as to form and substance in all material respects with the applicable requirements of the Exchange Act.
(b) The Company agrees that none of the information supplied or to be supplied by the Company for inclusion or incorporation by reference in the Proxy Statement will, at the date it is first mailed to the shareholders of the Company and at the time of the Shareholders Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they are made, not misleading. Acquiror agrees that none of the information supplied or to be supplied by Acquiror for inclusion or incorporation by reference in the Proxy Statement will, at the date it is first mailed to the shareholders of the Company and at the time of the Shareholders Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in the light of the circumstances under which they are made, not misleading. For purposes of the foregoing, it is understood and agreed that information concerning or related to the Company, any Company Subsidiary or any Nonprofit Organization will be deemed to have been supplied by the Company and information concerning or related to Acquiror will be deemed to have been supplied by Acquiror. If at any time after the date of this Agreement and prior to the date of the Shareholders Meeting any event or circumstances relating to the Company, any Company Subsidiary or any Nonprofit Organization, or their respective officers or directors, should be discovered by the Company that should be set forth in an amendment or a supplement to the Proxy Statement, the Company will promptly inform Acquiror and, after consultation with Acquiror, file such amendment or supplement with the SEC. If at any time after the date of this Agreement and prior to the date of the Shareholders Meeting any event or circumstances relating to Acquiror, its officers or directors, should be discovered by Acquiror that should be set forth in an amendment or a supplement to the Proxy Statement, Acquiror will promptly inform the Company and, after consultation with Acquiror, the Company will file such amendment or supplement with the SEC.
(c) The Company will use its reasonable best efforts, after consultation with Acquiror, to resolve all SEC comments with respect to the Proxy Statement as promptly as practicable after receipt thereof. Each of Acquiror and the Company agree to correct any information provided by it for use in the Proxy Statement which will have become false or misleading. The Company will as soon as reasonably practicable notify Acquiror of the receipt of any comments from or other correspondence with the SEC staff with respect to the Proxy Statement and any request by the SEC for any amendment to the Proxy Statement or for
additional information (and promptly deliver a copy of such comments, correspondence or request to Acquiror).
6.5 Access to Information. During the period from the execution of this Agreement through the earlier of the termination of this Agreement pursuant to its terms or the Effective Time, the Company will, and will cause each Company Subsidiary and Nonprofit Organization to, afford representatives of Acquiror and its financing sources reasonable access during normal business hours to officers, employees, agents and representatives of the Company, the Company Subsidiaries and the Nonprofit Organizations and to all of their respective properties (including without limitation, access for the purpose of (i) performing any non-intrusive environmental procedures, investigations or studies, or taking other non-intrusive actions related thereto, in connection with obtaining Phase I Environmental Site Assessments for or at the Real Property and (ii) preparing and coordinating programs, objectives and other information related to the integration of the business of the Company with the business of Acquiror and its Affiliates following consummation of the Cash Merger), and will furnish, within a reasonable time, to Acquiror all information (including extracts and copies of books, records, contracts and other documents, including a copy of each report, schedule, registration statement and other document filed or received by it during such period pursuant to the requirements of federal securities laws) concerning the operations and business of the Company, any Company Subsidiary or any Nonprofit Organization, including access to their respective personnel as Acquiror may reasonably request. In conducting any inspection of any properties of the Company, the Company Subsidiaries or the Nonprofit Organizations, neither Acquiror nor any of its representatives will (A) interfere with the business of the Company, any Company Subsidiary or any Nonprofit Organization conducted at such property, or (B) damage any property or any portion thereof. The Company acknowledges and agrees that Acquiror will be permitted to contact and have discussions with any vendors, suppliers, tenants and subtenants; provided that Acquiror provides the Company with reasonable advance notice of its intention to take any of the foregoing actions and Acquiror agrees to use its reasonable best efforts not to unreasonably interfere with the business of the Company, any Company Subsidiary or any Nonprofit Organization in taking any of the foregoing actions. The Company and Acquiror will each promptly provide the other copies of all filings made by such party with any Governmental Entity in connection with this Agreement and the transactions contemplated hereby.
6.6 Confidentiality. (a) All information relating to the Company, the Company Subsidiaries and the Nonprofit Organizations that is obtained by Acquiror pursuant to this Agreement or in connection with the negotiation of this Agreement and the consummation of the transactions contemplated hereby and (b) all information relating to Acquiror and its Affiliates and financing sources that is obtained by the Company pursuant to this Agreement or in connection with the negotiation of this Agreement and the consummation of the transactions contemplated hereby, will constitute "Confidential Information." Confidential Information of the other parties to this Agreement may be used or disclosed by the recipient only in connection with this Agreement and each party agrees to protect the confidentiality of the Confidential Information of the other parties in the same manner that it protects the confidentiality of its own proprietary and confidential information of like kind and sensitivity, but in no event will less than reasonable care be exercised. The Company and Acquiror agree that all terms and conditions of this Agreement shall be treated as confidential and shall not be disclosed without the other party's prior written consent, except as required in connection with the Proxy Statement
or otherwise by applicable Law or a Governmental Authority. Confidential Information shall not include information that: (i) was in the recipient's possession prior to being furnished by the disclosing party; (ii) is or becomes publicly available through no breach of the terms of this Agreement by the recipient; (iii) is received by the recipient from a third party who, to the recipient's knowledge, was not thereby in breach of any confidentiality obligation; or (iv) is independently developed by the recipient without use of the disclosing party's confidential or proprietary information. In the event any party receives a subpoena or other validly issued administrative or judicial process requesting any portion of the Confidential Information of any other party, it shall provide prompt notice to the other of such receipt and tender to it defense of such demand. Unless the demand shall have been timely limited, quashed or extended, the party receiving the subpoena shall thereafter be entitled to comply with such subpoena or other process to the extent permitted by law. If requested by the disclosing party, the recipient shall cooperate (at the disclosing party's expense) in the defense of a demand.
6.7 | Acquisition Proposals. |
(a) The Company agrees that, except as otherwise permitted in this Section 6.7, (i) it and its officers and directors will not, (ii) the Company Subsidiaries and the Company Subsidiaries' officers and directors will not, and (iii) its and the Company Subsidiaries' investment bankers, financial advisors, attorneys, accountants, employees, consultants or other agents, advisors or representatives (collectively, "Representatives") will not, (A) directly or indirectly, initiate, solicit, cause, encourage or otherwise knowingly facilitate any inquiries or the making, submission or reaffirmation of any proposal or offer with respect to a tender offer or exchange offer, proxy solicitation, merger, reorganization, share exchange, recapitalization, liquidation, dissolution, consolidation, business combination or other similar transaction involving the Company and/or the Company Subsidiaries or any proposal or offer to acquire in any manner an equity or voting interest in the Company, or the assets, securities or other ownership interests of or in the Company or any Company Subsidiary, in each case other than the transactions contemplated by this Agreement (any such proposal or offer being hereinafter referred to as an "Acquisition Proposal"), or (B) directly or indirectly, engage in any negotiations or discussions concerning, or provide access to its properties, books and records or any confidential information or data to, any Person relating to, or that may reasonably be expected to lead to, an Acquisition Proposal. The Company will promptly take the steps necessary to inform the Persons set forth in clauses (i), (ii) and (iii) of the foregoing sentence of the obligations undertaken in this Section 6.7, and the Company agrees that it will be responsible for any breach of this Section 6.7 by those Persons. Subject to Section 6.7(b), neither the Company nor its Board of Directors or any committee thereof will approve or recommend, or propose to approve or recommend, or execute or enter into, any letter of intent, agreement in principle, or any other agreement, arrangement or understanding relating in any respect to an Acquisition Proposal or propose or agree to do any of the foregoing. Notwithstanding the foregoing, nothing contained in this Agreement will prevent the Company or the Board of Directors from (i) taking and disclosing to its shareholders a position contemplated by Rule 14d-9 or Rule 14e-2(a) promulgated under the Exchange Act (or any similar communication to shareholders in connection with the making or amendment of a tender offer or exchange offer) or from making any legally required disclosure to shareholders with regard to an Acquisition Proposal (provided that neither the Company nor its Board of Directors may recommend any Acquisition Proposal unless permitted by Section 6.7 (b) below and the
Company may not fail to make or withdraw, modify or change in a manner adverse to Acquiror all or any portion of the Board Recommendation, and provided further that, notwithstanding anything herein to the contrary, any "stop-look-and-listen" communication by the Company or its Board of Directors to the shareholders of the Company pursuant to Rule 14d-9(f) promulgated under the Exchange Act (or any similar communication to the shareholders of the Company in connection with the making or amendment of a tender offer or exchange offer containing the substance of a "stop-look-and-listen" communication pursuant to such Rule 14d-9(f)) will not be considered a failure to make, or a withdrawal, modification or change in any manner adverse to Acquiror of, all or a portion of the Company Board Recommendation), or (ii) prior to the approval of this Agreement by the Company's shareholders in accordance with this Agreement, (A) providing access to its properties, books and records and providing information or data in response to a request therefor by a Person who has made an unsolicited bona fide written Acquisition Proposal if the Board of Directors receives from the Person so requesting such information an executed confidentiality agreement on terms substantially similar to those contained in Section 6.6 (except for such changes specifically necessary in order for the Company to be able to comply with its obligations under this Agreement) or (B) engaging in any negotiations or discussions with any Person who has made an unsolicited bona fide written Acquisition Proposal, if and only to the extent that prior to taking any of the actions set forth in clauses (A) or (B) of clause (ii), (x) the Board of Directors will have determined in good faith, after consultation with its outside legal counsel and financial advisors, that such action is necessary in order for the Board of Directors to comply with its fiduciary duties under applicable Law and (y) the Company will have informed Acquiror promptly following (and in no event later than 24 hours after) the taking by it of any such action.
A "Superior Proposal" means a bona fide written Acquisition Proposal that, after taking into account all legal, financial, regulatory, timing and other aspects of the proposal and the Person or Persons making the proposal (including any break-up fees, expense reimbursement provisions and conditions to consummation), (i) would, if consummated, result in a transaction more favorable to the Company's shareholders from a financial point of view than the transactions contemplated by this Agreement (after giving effect to any adjustments to the terms and conditions of this Agreement proposed in writing by Acquiror in response to such Acquisition Proposal) and (ii) is fully financed or reasonably capable of being fully financed, reasonably likely to receive all required governmental approvals on a timely basis and otherwise reasonably capable of being consummated on the terms proposed. The Company will promptly inform the Persons set forth in clauses (i), (ii) and (iii) of the first sentence of this Section 6.7(a) of the obligations undertaken in this Section 6.7.
(b) Notwithstanding anything in this Section 6.7 to the contrary, if, at any time prior to the approval of this Agreement by the Company's shareholders in accordance with this Agreement, the Board of Directors determines in good faith, after consultation with and receipt of advice from its financial advisors and legal counsel, in response to a bona fide written Acquisition Proposal that was unsolicited and that did not otherwise result from a breach of Section 6.7(a), that such Acquisition Proposal is a Superior Proposal and that terminating this Agreement to accept such Superior Proposal and/or recommending such Superior Proposal to the shareholders of the Company is necessary in order for the Board of Directors to comply with its fiduciary duties under applicable Law, the Company may terminate this Agreement and/or its Board of Directors may recommend such Superior Proposal to its shareholders, as applicable;
provided, however, that the Company will not terminate this Agreement pursuant to this sentence, and any purported termination pursuant to this sentence will be void and of no force or effect, unless concurrently with such termination pursuant to this Section 6.7(b) the Company pays to Acquiror the termination amounts payable pursuant to Sections 8.2(b) and 8.2(c); and provided, further, that the Company will not exercise its right to terminate this Agreement and the Board of Directors will not recommend a Superior Proposal to its shareholders pursuant to this Section 6.7(b) unless the Company will have delivered to Acquiror a prior written notice advising Acquiror that the Company or its Board of Directors intends to take such action with respect to a Superior Proposal, specifying in reasonable detail the material terms and conditions of the Superior Proposal, such notice to be delivered not less than 72 hours prior to the time the action is taken, and, during such 72 hour period, the Company and its advisors will negotiate in good faith with Acquiror to make such adjustments in the terms and conditions of this Agreement such that such Acquisition Proposal would no longer constitute a Superior Proposal, in which case this Agreement will remain in full force and effect and the Company will reject such Acquisition Proposal. For avoidance of doubt, the Company acknowledges and agrees that it will not have the right to terminate this Agreement pursuant to this Section 6.7(b) after the Shareholders Meeting (or any postponement or adjournment thereof) if, at the Shareholders Meeting, the Requisite Shareholder Vote is obtained to approve this Agreement.
(c) The Company agrees that (i) it will, and will cause each Company Subsidiary and its and their Representatives to, immediately cease and cause to be terminated any existing activities, discussions or negotiations with any Persons conducted heretofore with respect to any Acquisition Proposal and (ii) except to the extent necessary to take any actions that the Company is otherwise permitted to take pursuant to this Section 6.7 (and in such case only in accordance with the terms of this Section 6.7), it will not release any Person from, or waive any provisions of, any confidentiality or standstill agreement to which it or any Company Subsidiary is a party with respect to any Acquisition Proposal. The Company will also, if it has not already done so, promptly request, to the extent it has a contractual right to do so, that each Person, if any, that has heretofore executed a confidentiality agreement within the twelve months prior to the date of this Agreement in connection with its consideration of any Acquisition Proposal to return or destroy all confidential information or data heretofore furnished to any Person by or on behalf of the Company, any Company Subsidiaries or any Nonprofit Organizations.
(d) The Company will promptly (and in no event later than 24 hours after receipt of an Acquisition Proposal) notify Acquiror (which notice will be provided orally and in writing and will identify any Person making an Acquisition Proposal and set forth in reasonable detail its material terms and conditions) of the Company's receipt of an Acquisition Proposal after the date hereof, or if any nonpublic information is requested from, or any discussions or negotiations are sought to be initiated or continued with, it, any Company Subsidiary or any of its or any Company Subsidiary's Representatives and thereafter will keep Acquiror informed, on a current basis, of the status and material terms and conditions of any proposals or offers. The Company will make available to Acquiror (to the extent it has not previously done so) all nonpublic information made available to any Person making an Acquisition Proposal after the date hereof at substantially the same time as it provides it to such other Person.
6.8 | Further Action; Reasonable Best Efforts. |
(a) Subject to the terms and conditions of this Agreement, each party will use commercially reasonable efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable under applicable Law or applicable agreement to consummate the transactions contemplated by this Agreement. In furtherance and not in limitation of the foregoing, each party hereto agrees to make an appropriate filing of a Notification and Report Form for Certain Mergers and Acquisitions pursuant to the HSR Act and to make other required filings pursuant to other Antitrust Laws with respect to the transactions contemplated by this Agreement, if and to the extent that the parties determine any such filings are required, as promptly as practicable after the date of this Agreement and to supply as promptly as practicable any additional information and documentary material that may be requested pursuant to the HSR Act or any other Antitrust Laws and to take all other actions necessary, proper or advisable to cause the expiration or termination of the applicable waiting periods under the HSR Act and any other applicable Antitrust Laws as soon as practicable.
(b) Acquiror and the Company will, in connection with the efforts referenced in Section 6.8(a) to obtain all requisite approvals and authorizations for the transactions contemplated by this Agreement under the HSR Act or any other Antitrust Law, use commercially reasonable efforts to (i) cooperate in all respects with each other in connection with any filing or submission and in connection with any investigation or other inquiry, including any proceeding initiated by a private party; (ii) keep the other party informed of any communication received by such party from, or given by such party to, the Federal Trade Commission (the "FTC"), the Antitrust Division of the Department of Justice (the "DOJ") or any other Governmental Authority and of any communication received or given in connection with any proceeding by a private party, in each case regarding any of the transactions contemplated hereby and thereby; and (iii) permit the other party to review any communication given by it to, and consult with each other in advance of any meeting or conference with, the FTC, the DOJ or any such other Governmental Authority or other Person or, in connection with any proceeding by a private party, with any other Person, and to the extent permitted by the FTC, the DOJ or such other applicable Governmental Authority or other Person, give the other party the opportunity to attend and participate in such meetings and conferences in accordance with Antitrust Law.
(c) In furtherance and not in limitation of the covenants of the parties contained in Sections 6.8(a) and (b), if any objections are asserted with respect to the transactions contemplated by this Agreement under any Antitrust Law or if any suit is instituted (or threatened to be instituted) by the FTC, the DOJ or any other applicable Governmental Authority or any private party challenging any of the transactions contemplated hereby and thereby as violative of any Antitrust Law or which would otherwise prohibit or materially impair or materially delay the consummation of the transactions contemplated hereby and thereby, each of Acquiror and the Company will use its reasonable best efforts to resolve any such objections or suits so as to permit consummation of the transactions contemplated by this Agreement, including in order to resolve such objections or suits which, in any case if not resolved, could reasonably be expected to prohibit or materially impair or delay the consummation of the transactions contemplated hereby and thereby; provided, however, that neither Acquiror nor any of its shareholders or Affiliates will be obligated to sell, hold separate or otherwise dispose of or
conduct its business in a manner which would resolve such objections or suits or agree to sell, hold separate or otherwise dispose of or conduct its business. Without excluding other possibilities, the transactions contemplated by this Agreement will be deemed to be materially delayed if unresolved objections or suits delay or could reasonably be expected to delay the consummation of the transactions contemplated hereby and thereby beyond the Termination Date.
(d) Subject to the obligations under Section 6.8(c), in the event that any administrative or judicial action or proceeding is instituted (or threatened to be instituted) by a Governmental Authority challenging any transaction contemplated by this Agreement or any other agreement contemplated hereby, (i) each of Acquiror and the Company will cooperate in all respects with each other and use its respective reasonable best efforts to contest and resist any such action or proceeding and to have vacated, lifted, reversed or overturned any decree, judgment, injunction or other order, whether temporary, preliminary or permanent, that is in effect and that prohibits, prevents or restricts consummation of the transactions contemplated by this Agreement, and (ii) each of Acquiror and the Company will use its respective reasonable best efforts to defend, at its own cost and expense, any action or actions, whether judicial or administrative, in connection with the transactions contemplated by this Agreement.
(e) Notwithstanding the foregoing or any other provision of this Agreement, nothing in this Section 6.8 will limit a party's right to terminate this Agreement pursuant to Section 8.1(b) or Section 8.1 (c) so long as such party has up to then complied in all material respects with its obligations under this Section 6.8.
6.9 Resignations. At or prior to the Closing Date, the Company will cause to be delivered to Acquiror duly signed resignations, effective as of the Effective Time, of the directors and officers (other than the officers listed in Section 2.7 of the Company Disclosure Schedule) of the Company, the Company Subsidiaries and the Nonprofit Organizations and will take such other action as is necessary to accomplish the foregoing.
6.10 Directors' and Officers' Liability Insurance; Continued Indemnity. Prior to the Closing Date, the Company will fully pay the applicable premiums to renew, increase and/or extend the Company's existing insurance policy or policies with respect to directors' and officers' liability insurance (the "Policies") (a) for period of six years following the Closing Date and (b) with a maximum amount of at least $10,000,000. Acquiror agrees to cause the Surviving Corporation to honor and perform the indemnification provisions set forth in the Company's bylaws in effect as of September 30, 2005.
6.11 Public Announcements. Each of the Company and Acquiror agrees that no public release or announcement concerning the transactions contemplated by this Agreement will be issued by any party without the prior written consent of the Company and Acquiror (which consent will not be unreasonably withheld or delayed), except as such release or announcement may be required by Law, in which case the party required to make the release or announcement will use its reasonable best efforts to allow the other party reasonable time to comment on such release or announcement in advance of such issuance.
6.12 | Cooperation; Financial Data. |
(a) The Company will, and will cause its Subsidiaries to, cooperate reasonably and in good faith, at Acquiror's request and expense, in providing documentation, participating in meetings, answering questions and otherwise providing information about the Company and its assets, employees, history and business and such other information or cooperation as may be reasonably requested by Acquiror from time to time after the date of this Agreement in order to help facilitate: (i) obtaining of any required governmental approvals to consummate the Cash Merger; (ii) implementation of Acquiror's desired post-Closing organizational structure for the Company; (iii) planning for the continued post-Closing operation of the Company's business; (iv) financing arrangements related to the Cash Merger or the post-Closing operation of the Company's business; and (v) such other events or circumstances for which the Company's and the Subsidiaries' cooperation would be helpful and for which Acquiror reasonably requests such cooperation.
(b) As soon as practicable, but in any event no later than 10 business days after each calendar month-end following the date of this Agreement that occurs prior to the Effective Time, the Company will deliver to Acquiror a copy of the Company's internal operating balance sheet and internal profit and loss statement (prepared in form and substance on a basis consistent with past practice).
6.13 | Nonprofit Organizations. |
(a) In connection with the Cash Merger, at the Effective Time, the Surviving Corporation will assume control of the boards of directors of the Nonprofit Organizations. Acquiror has agreed that the Surviving Corporation shall do so as an accommodation to the Company and in acknowledgment of the ancestral heritage of the Company's shareholders and the history of the Atrisco Land Grant and the Real Property. Acquiror will cause the Surviving Corporation to continue to operate the Nonprofit Organizations as nonprofit organizations in keeping with their charitable or other exempt purposes. The parties acknowledge and agree that no part of the Cash Merger Consideration is intended to be, or will be construed as or accounted for as, payment or consideration for any of the assets of the Nonprofit Organizations.
(b) From and after the Effective Time, Acquiror will cause the Surviving Corporation to continuously maintain, preserve and operate the Nonprofit Organizations and their respective assets and operations, including without limitation the Santa Clara Cemetery, the San Jose de Armijo Cemetery, the Evangelico Cemetery (collectively, the "Cemeteries") and the church known as La Capillita Antigua, San Jose de Ranchos de Atrisco (the "Church"), all of which are located on the Real Property, in a respectful manner consistent with the Company's past practices. Without limiting the foregoing, Acquiror will cause the Surviving Corporation to honor all historical and hereditary rights and privileges of Atrisco Land Grant heirs, their families and others in the Atrisco community with respect to burial in the Cemeteries. Acquiror may, in its discretion, cause the Surviving Corporation to reorganize or restructure the Nonprofit Organizations and their assets in order to operate them more efficiently or effectively, provided such restructuring or reorganization does not result in the disturbance of the Cemeteries (including access thereto) or disruption in the operation or maintenance of the Cemeteries or the Church. Additionally, Acquiror may, in its discretion, cause the Surviving Corporation to create
one or more new nonprofit organizations or establish one or more trusts or other appropriate entities and endow such entities with sufficient assets so as to provide for their continued operation; provided, that any such arrangement must be adequate to provide reasonable assurance of continuing compliance with Acquiror's obligations pursuant to this Section 6.13. Notwithstanding anything to the contrary in this Section 6.13(b), the Surviving Corporation will be obligated to fund the Cemeteries and the Church only to the extent that the Cemeteries and the Church do not receive sufficient funds to operate from their normal operating revenues or contributions from other sources.
(c) In the event that the Surviving Corporation is sold (through a stock or asset sale) or merged with or into another Person in a transaction in which the Surviving Corporation is not the survivor, the Surviving Corporation will use commercially reasonable efforts to ensure that the acquiring Person continues to honor Acquiror's and the Surviving Corporation's commitments pursuant to this Section 6.13, or to make other arrangements reasonably designed to ensure such ongoing performance.
6.14 Employees. Except for any officers of the Company immediately prior to the Effective Time who are not identified in Section 2.7 of the Company Disclosure Schedule or who otherwise resign from the Company, Acquiror will cause the Surviving Corporation to continue to employ all employees of the Company, the Company Subsidiaries and the Nonprofit Organizations at their current compensation and benefit levels (as of the date of this Agreement) for a period of not less than six months following the Effective Time, subject to the Surviving Corporation's right to terminate any such employees for cause during such six month period.
6.15 | Title and Title Insurance. |
(a) The Company shall request the Title Insurer to deliver to Acquiror a current Commitment for Title Insurance or a Preliminary Title Report, together with legible copies of all documents referred to therein (collectively, the "Title Report") from the Title Insurer. The Title Report shall show the status of title to the Real Property as of the date of the Title Report and shall list the Company as the proposed insured.
(b) The Company, at Acquiror's expense, shall cause Title Insurer to provide the Company with an ALTA owner's comprehensive policy of title insurance, including owner's comprehensive endorsements in the form of NM56 (as to unimproved land) and NM57 (as to improved land) and a non-imputation endorsement in the form of NM28 (collectively, the "Owner's Title Policy") at the Closing Date or as soon thereafter as is reasonably possible, provided, however, that if the Owner's Title Policy is not delivered at Closing, Title Insurer will, at Closing, deliver an unconditional commitment to issue the Owner's Title Policy and a pro forma title policy. The Company will cooperate with Acquiror and the Title Insurer with respect to executing and delivering any affidavits or other documents or certificates required by the Title Insurer as a condition precedent to its issuance of the Owner's Title Policy. The Owner's Title Policy shall be issued by the Title Insurer in the amount not less than $210,000,000.00, effective as of the Closing Date, and shall insure the Company that fee simple title to the Real Property is vested in the Company, subject only to: (i) the usual printed exceptions and exclusions contained in such title insurance policies; and (ii) the exceptions to title approved in writing by Acquiror.
6.16 Further Action. Each of the parties hereto will use its reasonable best efforts to take, or cause to be taken, all appropriate action, do or cause to be done all things necessary, proper or advisable under applicable Law, and execute and deliver such documents and other papers, as may be required to consummate the transactions contemplated by this Agreement, including a written instruction letter to the Paying Agent to proceed with the actions required by this Agreement.
6.17 Creation and Funding of Trust for Charitable Programs. The parties further agree to the creation of a trust prior to the Effective Time by the Company in accordance with law and subject to the terms of this Agreement to promote and preserve the ancestral and cultural heritage of the Company's shareholders and the history of the Atrisco Land Grant and the Real Property and to otherwise serve the local community. The trust will be administered by the Surviving Corporation or Persons affiliated therewith, but the trust shall also organize an advisory council to which at least five (5) of the persons currently on the Company's Board of Directors or their successor designees shall be appointed. Arrangements with respect to this matter established prior to the Effective Time are subject to the consent of Acquiror, which consent may not be unreasonably withheld by Acquiror. Such trust shall be funded with certain oil and gas revenues, if any, for the use and benefit of the heirs of the Atrisco Grant; provided that the parties acknowledge that the Surviving Corporation shall have the exclusive right to determine, in its sole discretion, whether to extend the currently existing term of any oil or gas lease. In addition, the Surviving Corporation will commit to donate $1,000,000 per year for 100 years following the Effective Date (an aggregate of $100,000,000) to support the establishment and operation of such trust. On the Closing Date, Acquiror shall deposit with an escrow agent reasonably acceptable to the Company, for the benefit of the aforementioned trust pending its formation and the occurrence of the Effective Time, $1,000,000, representing the first annual contribution by the Surviving Corporation to such trust.
6.18 Fairness Opinion. As soon as practicable, but in any event within thirty (30) days following the execution of this Agreement, the Company will obtain a written opinion from CBIZ Valuation Group, LLC confirming that, as of the date of this Agreement, the Cash Merger Consideration is fair, from a financial point of view, to the holders of the Company Common Stock. The Company will provide a copy of such opinion to Acquiror promptly upon receipt thereof.
ARTICLE VII
CONDITIONS PRECEDENT TO CASH MERGER
7.1 Mutual Conditions to Closing. The respective obligations of each party to consummate the transactions contemplated by this Agreement will be subject to the fulfillment at or prior to the Closing, of each of the following conditions:
(a) This Agreement will have been approved by the shareholders of the Company by the Requisite Shareholder Vote in accordance with the Company's articles of incorporation, bylaws and the NMBCA;
(b) No Law which prohibits, restrains or enjoins the consummation of the transactions contemplated by this Agreement will have been enacted, entered, promulgated or
enforced by any United States federal or state Governmental Authority, unless failing to comply with such Law would not, individually or in the aggregate, reasonably be expected to either result in a Material Adverse Effect or lead to the criminal prosecution of any officer of director of Acquiror, the Company or their respective Affiliates; provided, however, that prior to invoking this condition each party agrees to comply with Section 6.8;
(c) No action, suit or proceeding will be pending seeking to prohibit, restrain or enjoin or challenging the consummation of the transactions contemplated by this Agreement instituted by any United States federal or state Governmental Authority, unless any such action, suit or proceeding would not, individually or in the aggregate, reasonably be expected to either result in a Material Adverse Effect or lead to the criminal prosecution of any officer of director of Acquiror, the Company, or their respective Affiliates; and
(d) (i) The waiting period (and any extension thereof) applicable to the transactions contemplated by this Agreement under the HSR Act will have been terminated or will have expired and (ii) all other required approvals pursuant to any Antitrust Law of any Governmental Authority will have been obtained or waiting periods thereunder will have been terminated or will have expired, unless if failure to obtain such approval or failure of such waiting period to terminate or expire would not, individually or in the aggregate, reasonably be expected to either result in a Material Adverse Effect or lead to the criminal prosecution of any officer of director of Acquiror, the Company, or their respective Affiliates.
7.2 Conditions to Obligations of Acquiror. The obligations of Acquiror to consummate the transactions contemplated by this Agreement will be further subject to the satisfaction or waiver at or prior to the Closing Date of each of the following conditions:
(a) The representations and warranties of the Company set forth in Article IV will be true, complete and correct in all material respects (without regard to any materiality or Material Adverse Effect qualifiers) as of the date of this Agreement and as of the Effective Time as though made on and as of such date (unless any such representation or warranty is made only as of a specific date, in which event such representation or warranty will be true, complete and correct as of such specific date);
(b) The Company will have performed in all material respects each of the obligations, and complied in all material respects with each of the agreements and covenants, required to be performed by or complied with by it under this Agreement at or prior to the Effective Time;
(c) The Company will have delivered to Acquiror its audited annual financial statements (or if audited financial statements are not available, unaudited financial statements, provided such unaudited financial statements have undergone at least a review by the Company's independent auditors) for all annual accounting periods ended after the Balance Sheet Date containing an unqualified opinion by its independent auditors that is not modified in any way by an explanatory paragraph relating to the consistency of the application of accounting principles, ability to continue as a going concern or for any other matter.
(d) There will not have occurred any fact, event, change, development, circumstance or effect which, individually or in the aggregate, has had or could reasonably be expected to have a Material Adverse Effect;
(e) The Dissenting Shares will not constitute more than ten percent (10%) of the issued and outstanding Shares;
(f) Each of the key employees of the Company identified in Section 7.2(f) of the Company Disclosure Schedule (each, a "Key Employee") will continue to be employed in the position set forth opposite such Person's name in Section 7.2(f) of the Company Disclosure Schedule, unless, in each case, such Key Employee will no longer be so employed as a result of (i) death or disability or (ii) termination by the Company for cause; provided, however, that, except as provided in Section 6.14, nothing in this Agreement will be construed as being or creating an obligation of Acquiror or the Company, as the Surviving Corporation in the Cash Merger, to continue the employment of any such Key Employee following the Closing; and
(g) Acquiror will have received the formal resignation of each person serving as a director of the Company effective at the Effective Time.
7.3 Conditions to Obligations of the Company. The obligations of the Company to consummate the transactions contemplated by this Agreement will be further subject to the satisfaction or waiver at or prior to the Closing of the following conditions:
(a) The representations and warranties of Acquiror set forth in this Agreement will be true and correct in all material respects, in each case as of the date of the date of this Agreement and as of the Effective Time as though made on and as of such date (unless any such representation or warranty is made only as of a specific date, in which event such representation and warranty will be true and correct in all material respects as of such specified date); and
(b) Acquiror will have performed in all material respects the obligations, and complied in all material respects with the agreements and covenants, required to be performed by or complied with by it under this Agreement at or prior to the Closing Date.
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
8.1 Termination before Effective Time. As set forth below, this Agreement may be terminated and the transactions contemplated hereby may be abandoned at any time prior to or on the Effective Time notwithstanding approval thereof by the Shareholders of the Company:
(a) | by mutual written consent of each party hereto; |
(b) by any party hereto if any United States federal or state Governmental Authority will have issued a final order, decree or ruling or taken any other final action restraining, enjoining or otherwise prohibiting the transactions contemplated by this Agreement and such order, decree, ruling or other action is or will have become final and nonappealable;
(c) by any party if the Effective Time has not occurred on or before the earlier of (i) June 1, 2006, or (ii) the date on which the conditions to such party's obligations as set forth in Article VII become incapable of being satisfied, unless such condition is waived by such party (the "Termination Date"); provided that the right to terminate this Agreement pursuant to this Section 8.1(c) will not be available to the party seeking to terminate if the failure of the Effective Time to occur on or before the Termination Date is the result of such party's breach of any representation or covenant contained in this Agreement or the failure of such party to use its reasonable efforts to satisfy the conditions precedent to the obligation of the other party to consummate the transactions contemplated by this Agreement;
(d) by the Company (i) if there will have been a failure of any condition to the Company's obligations set forth in Section 7.3 (and such condition has not been waived by the Company) or a material breach of any material representation, warranty, covenant or agreement on the part of Acquiror contained in this Agreement, or if any such representation or warranty will have become untrue or inaccurate, such that(A) the conditions set forth in Sections 7.3(a) or 7.3(b) would not be capable of being satisfied and (B) such breach or inaccuracy is not capable of being cured or, if reasonably capable of being cured, will not have been cured prior to the earlier of (1) 30 Business Days following notice of such breach and (2) the Termination Date; provided that the Company will not have the right to terminate this Agreement pursuant to this Section 8.1(d)(i) if the Company is then in material breach of any of its representations, warranties, covenants or agreements contained in this Agreement or if any such representation or warranty will have become materially untrue or inaccurate, or (ii) prior to the adoption and approval of this Agreement by the shareholders of the Company, in accordance with, and subject to the terms and conditions of, Section 6.7(b);
(e) by Acquiror (i) if there will have been a failure of any condition to Acquiror's obligations set forth in Section 7.2 (and such condition has not been waived by Acquiror) or the breach of any representation, warranty, covenant or agreement on the part of the Company contained in this Agreement, or if any such representation or warranty will have become untrue or inaccurate, such that (A) the conditions set forth in Sections 7.2(a) or (b) would not be capable of being satisfied and (B) such breach or inaccuracy is not capable of being cured or, if reasonably capable of being cured, will not have been cured prior to the earlier of (1) 30 Business Days following notice of such breach and (2) the Termination; provided that Acquiror will not have the right to terminate this Agreement pursuant to this Section 8.1(e)(i) if Acquiror is then in material breach of any of its representations, warranties, covenants or agreements contained in this Agreement or if any such representation or warranty will have become untrue or inaccurate, or (ii) if the Board of Directors (A) will have withdrawn, modified or changed (it being understood and agreed that any "stop-look-and-listen" communication by the Board of Directors to the shareholders of the Company pursuant to Rule 14d-9(f) of the Exchange Act, or any similar communication to the shareholders of the Company in connection with the commencement of a tender offer or exchange offer containing the substance of a "stop-look-and-listen" communication pursuant to Rule 14d-9(f), will not be deemed to constitute a withdrawal, modification or change of its recommendation of this Agreement) in a manner adverse to Acquiror its approval or recommendation of the transactions contemplated by this Agreement, or will have resolved to effect any of the foregoing, or (B) will have recommended to the shareholders of the Company an Acquisition Proposal other than the transactions contemplated hereunder, or will have resolved to effect any of the foregoing;
(f) by any party if, upon a vote thereon at the Shareholders Meeting or any postponement or adjournment thereof, this Agreement will not have been approved by the Requisite Shareholder Vote.
8.2 | Effect of Termination. |
(a) In the event of the termination of this Agreement pursuant to Section 8.1, this Agreement will forthwith become void and there will be no liability or obligation on the part of any party hereto, except with respect to Section 6.6, this Section 8.2, Section 8.3 and Article IX, which will survive such termination; provided, however, that nothing herein will relieve any party from liability for any willful and material breach hereof.
(b) In the event that this Agreement is terminated pursuant to Section 8.1(a), 8.1(b), 8.1(c), 8.1(d)(ii), or 8.1(e), Acquiror will be entitled to the return of the full amount of the Deposit paid pursuant to Section 2.1, together with all interest accrued thereon, and the Company shall pay to Acquiror the full amount of the ANM Termination Fee paid by Acquiror pursuant to Section 2.1. In the event that this Agreement is terminated pursuant to Section 8.1(f), Acquiror will be entitled to the return of the full amount of the Deposit paid pursuant to Section 2.1, together with all interest accrued thereon. If this Agreement is terminated pursuant to Section 8.1(d)(i), the Company will be entitled to be paid the full amount of the Deposit, together with all interest accrued thereon, as liquidated damages and its sole and exclusive remedy for any breach or liability of Acquiror under this Agreement, it being acknowledged that such amount is intended as a reasonable estimate of the Company's damages in such event, and is not intended as a penalty. Acquiror will instruct the Paying Agent to wire the Deposit, together with all interest accrued thereon, in immediately available funds, to Acquiror or the Company, as applicable, in accordance with this Section 8.2(b), as promptly as practicable (but in any event within two Business Days) after termination of this Agreement.
(c) In addition, in the event that this Agreement is terminated by the Company pursuant to Section 8.1(d)(ii) or by Acquiror pursuant to Section 8.1(e)(i) or (ii), then the Company will promptly pay Acquiror the sum of $5,000,000 as liquidated damages in addition to the return of its Deposit and the ANM Termination Fee pursuant to Section 8.2(b). In the event that this Agreement is terminated by the Company pursuant to Section 8.1(d)(i), then Acquiror will promptly pay the Company the sum of $5,000,000 as liquidated damages, which payment may be satisfied by the release of the Deposit by the escrow agent holding said Deposit to the Company, as provided in Section 8.2(b) above. The parties agree that the foregoing amounts are reasonable estimates of their respective damages in the applicable circumstances and that such amounts are not intended as, and do not, constitute penalties. The Company or Acquiror, as and to the extent applicable, will pay the amounts owed under this Section 8.2(c) to the other party as promptly as practicable (but in any event within two Business Days) after termination of this Agreement pursuant to Section 8.1(d)(i) or (ii) or Section 8.1(e)(i) or (ii), payable by wire transfer of immediately available funds.
(d) The parties acknowledge that the agreements contained in this Section 8.2 are an integral part of the transactions contemplated by this Agreement, and that, without these agreements, none of the parties hereto would enter into this Agreement; accordingly, if a party fails to timely pay any amount required to be paid by it pursuant to this Section 8.2 (such party,
the "Payor"), and, in order to obtain the payment, the party entitled to receive such payment pursuant to this Section 8.2 (such other party, the "Payee") commences a suit which results in a judgment against the Payor for the payment set forth in this Section 8.2, the Payor will pay to Payee its reasonable costs and expenses (including reasonable attorneys' fees) in connection with this suit, together with interest on the amount due from each date for payment until the date of the payment at the prime rate (as published in The Wall Street Journal on the date the payment was required to be made) plus one percentage point.
8.3 Expenses. Except as otherwise specifically provided in this Agreement, each party will bear its own expenses in connection with this Agreement and the transactions contemplated hereby; provided that Acquiror shall be exclusively responsible for all filing fees in connection with filings to be made, if any, under the HSR Act.
8.4 Amendment. Subject to applicable Law, this Agreement may be amended by the parties hereto by action taken by or on behalf of their respective boards of directors at any time prior to the Effective Time. This Agreement may not be amended except by an instrument in writing signed by the parties hereto.
8.5 Waiver. At any time prior to the Effective Time, any party hereto may (a) extend the time for the performance of any of the obligations or other acts of the other parties hereto, (b) waive any inaccuracies in the representations and warranties contained herein or in any document delivered pursuant hereto and (c) subject to the requirements of applicable Law, waive compliance with any of the agreements or conditions contained herein. Any such extension or waiver will be valid if set forth in an instrument in writing signed by the party or parties to be bound thereby.
ARTICLE IX
GENERAL PROVISIONS
9.1 Non-Survival of Representations, Warranties and Agreements. None of the representations, warranties, covenants and agreements in this Agreement or in any instrument delivered pursuant to this Agreement, including any rights arising out of any breach of such representations, warranties, covenants and agreements, will survive the Effective Time, except for (a) those covenants and agreements contained herein that by their terms apply or are to be performed in whole or in part at or after the Effective Time and (b) this Article IX.
9.2 Materiality; Company Disclosure Schedule. As used in this Agreement, unless the context would require otherwise, the terms "material" or "material to the Company" and the concept of the "material" nature of an effect upon the Company will be measured relative to the entire business of the Company, the Company Subsidiaries and the Nonprofit Organizations taken as a whole.
9.3 Notices. Any and all notices or other communications or deliveries required or permitted to be provided hereunder will be in writing and will be deemed given and effective on the earliest of (a) the date of transmission, if such notice or communication is delivered via facsimile or electronic mail (in either case with electronic confirmation of receipt) at the facsimile telephone number or email address specified in this Section 9.3 prior to 5:00 p.m.
(Albuquerque, New Mexico time) on a Business Day; (b) the Business Day after the date of transmission, if such notice or communication is delivered via facsimile or electronic mail (in either case with electronic confirmation of receipt) at the facsimile telephone number or email address specified in this Section 9.3 later than 5:00 p.m. (Albuquerque, New Mexico time) on any date and earlier than 11:59 p.m. (Albuquerque, New Mexico time) on such date; (c) the Business Day after dispatch for overnight delivery, if sent by a nationally recognized overnight courier service; or (d) actual receipt by the party to whom such notice is required to be given. The address for such notices and communications will be as follows:
If to the Company:
Westland Development Co., Inc.
401 Coors Boulevard, NW
Albuquerque, New Mexico 87121
Fax: (505) 831-4865
Email: bpage@westlandnm.com
Attention: Barbara Page, President
with a copy to:
Westland Development Co., Inc.
401 Coors Boulevard, NW
Albuquerque, New Mexico 87121
Fax: (505) 831-4865
Email: rsimon7@aol.com
Attention: Robert S. Simon, Esq.
if to Acquiror, to:
SHNM Acquisition Corp.
c/o Sedora Holdings, LLC
4730 S. Fort Apache Road, Suite 300
Las Vegas, Nevada 89147
Fax: (702) 873-5129
Email: fchin@rhodeshomes.com
Attention: Frederick Chin, Chief Operating Officer
with a copy to:
Gibson, Dunn & Crutcher LLP
2029 Century Park East, Suite 40
Los Angeles, California 90067
Fax: (310) 552-7038
Email: mlahive@gibsondunn.com
Attention: Mark S. Lahive, Esq.
9.4 Severability. If any term or other provision of this Agreement is determined by a court of competent jurisdiction to be invalid, illegal or incapable of being enforced by any Law
or public policy, all other terms and provisions of this Agreement will nevertheless remain in full force and effect so long as the economic or legal substance of the transactions contemplated hereby is not affected in any manner materially adverse to any party. Upon such determination that any term or other provision is invalid, illegal or incapable of being enforced, the parties hereto will negotiate in good faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner in order that the transactions contemplated hereby are consummated as originally contemplated to the greatest extent possible.
9.5 Entire Agreement. This Agreement and the Company Disclosure Schedule constitute the entire agreement of the parties hereto with respect to the subject matter hereof and supersede all prior agreements and undertakings, both written and oral, between the parties hereto with respect to the subject matter hereof.
9.6 Assignment. This Agreement may not be assigned by any party or by operation of law or otherwise without the prior written consent of each of the other parties (which consent may be granted or withheld in the sole discretion of such other party), except that the Agreement may be assigned (in whole but not in part) (a) to an Affiliate of a party hereto or (b) by Acquiror to any of its Affiliates or their respective financing sources; provided that the party making such assignment will not be released from its obligations hereunder. Any attempted assignment in violation of this Section 9.6 will be void.
9.7 No Third Party Beneficiaries. Except for Section 6.10, this Agreement will be binding upon and inure solely to the benefit of the parties hereto and their permitted assigns and nothing herein, express or implied, is intended to or will confer upon any other Person any legal or equitable right, benefit or remedy of any nature whatsoever under or by reason of this Agreement.
9.8 Governing Law. This Agreement and the legal relations between the parties will be governed by, and construed in accordance with, the laws of the State of Delaware, except to the extent the laws of the State of New Mexico are required to apply to the Cash Merger (without giving effect to choice of law principles thereof).
9.9 Specific Performance; Jurisdiction. The parties agree that irreparable damage would occur in the event that any of the provisions of this Agreement were not performed in accordance with their specific terms or were otherwise breached. It is accordingly agreed that the parties will be entitled to an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this Agreement in any federal or state court sitting in Albuquerque, New Mexico, this being in addition to any other remedy to which such party is entitled at law or in equity. In addition, each of the parties hereto (a) consents to submit itself to the personal jurisdiction of the federal and state courts sitting in Albuquerque, New Mexico in the event any dispute arises out of this Agreement or any of the transactions contemplated by this Agreement, (b) agrees that it will not attempt to deny or defeat such personal jurisdiction by motion or other request for leave from such court, (c) agrees that it will not bring any action relating to this Agreement or any of the transactions contemplated by this Agreement in any court other than the federal and state courts sitting in Albuquerque, New Mexico and (d) to the fullest extent permitted by Law, consents to service being made through the notice procedures set forth in Section 9.3.
9.10 Counterparts. This Agreement may be executed in one or more counterparts, and by the different parties hereto in separate counterparts, and by facsimile signature, each of which when executed will be deemed to be an original but all of which taken together will constitute one and the same agreement.
9.11 Interpretation. When reference is made in this Agreement to a Section, such reference will be to a Section of this Agreement unless otherwise indicated. The table of contents and headings contained in this Agreement are for convenience of reference purposes only and will not affect in any way the meaning or interpretation of this Agreement. Whenever the words "include", "includes" or "including" are used in this Agreement, they will be deemed to be followed by the words "without limitation". This Agreement will be construed without regard to any presumption or rule requiring construction or interpretation against the party drafting or causing any instrument to be drafted. The meanings given to terms defined herein will be equally applicable to both the singular and plural forms of such terms.
9.12 Knowledge. As used throughout this Agreement, the term "knowledge" (and its variation, "know") means the actual awareness of a particular fact or circumstance and the awareness of a fact or circumstance that a prudent individual could reasonably be expected to discover or otherwise become aware of in the course of conducting a reasonable investigation and due inquiry concerning the fact or circumstance. In all instances, "knowledge" of the Company, the Company Subsidiaries and/or the Nonprofit Organizations shall be deemed to include, without limitation, the collective knowledge of all of the directors and officers of the Company.
[signature page follows]
IN WITNESS WHEREOF, the Company and Acquiror have caused this Agreement to be executed as of the date first written above by their respective officers thereunto duly authorized.
WESTLAND DEVELOPMENT CO., INC.
Name: Barbara Page
Title: President
SHNM ACQUISITION CORP.
Name: Fred Chin
Title: Chief Operating Officer
Restated
Articles of Incorporation
of
Westland Development Co., Inc.
Westland Development Co., Inc. (NMPRC #3179900) adopts the following Restated Articles of Incorporation under the New Mexico Business Corporation Act:
Article I: The name of this corporation shall be Westland Development Co., Inc.
Article II: The period of this corporation's existence shall be in perpetuity.
Article III: This corporation shall have all of the powers granted to business corporations by the New Mexico Business Corporation Act (Sections 53-1 through 53-18 NMSA 1978).
Article IV: The corporation has authority to issue 1,000,000 shares of common stock. The board of directors may divide any or all classes into series, and may fix and determine the designations, preferences, privileges and voting powers, and the restrictions and qualifications thereof, of the shares of each series so established.
Article V: The corporation shall indemnify each of its directors, officers, employees, and agents to the fullest extent permissible under NMSA Section 53-11-4.1l; provided, however, that such indemnification shall only be available with respect to facts, events or circumstances arising or occurring after the effective date of these Restated Articles of Incorporation. Subject to the proviso in the preceding sentence, indemnification of directors and officers shall be mandatory in all circumstances in which indemnification is permitted by law.
Article VI: To the fullest extent permitted by the New Mexico Statutes as in effect from time to time, a director of this corporation shall not be personally liable to the corporation or its shareholders for monetary damages for any action taken or any failure to take any action as a director on or after the effective date of these Restated Articles of Incorporation. Any repeal or modification of this article shall not increase the liability of a director of the corporation arising out of acts or omissions occurring before the repeal or modification becomes effective.
Article VII: The board of directors may, from time to time, make distributions to shareholders that do not violate the provisions of NMSA Section 53-11-44, in cash or property.
These Restated Articles of Incorporation correctly set forth without change the corresponding provisions of the Articles of Incorporation as amended, and supersede the original Articles of Incorporation and all previous amendments.
Executed _______________, 2005.
Westland Development Co., Inc.
[____________]
Sedora Holdings, LLC
[____________]
Amended and Restated
Bylaws
of
Westland Development Co., Inc.
(As Adopted __________)
Section 1
Offices, Corporate Seal, and Share Certificates
1.1 Offices. The corporation shall maintain a principal office in New Mexico. The corporation may maintain offices and transact business at any place designated by the board of directors.
1.2 Corporate Seal. A corporate seal is not required on any instrument executed for the corporation. If a corporate seal is used, it shall be either a circle having on its circumference "ANM Holdings, Inc.," and in the center "Incorporated 2005 Delaware," or a circle having on its circumference the words "Corporate Seal."
1.3 Certificates for Shares. Certificates representing the shares of the corporation shall be in such form as shall be determined by the board of directors. Such certificates shall be signed by any officer of the corporation.
1.4 Transfer of Shares. Shares of stock of the corporation shall be transferable on the books of the corporation only by the holder of record in person or by a duly authorized attorney, upon surrender and cancellation of certificates for a like number of shares.
1.5 Lost Certificates. If any certificate for shares of the corporation is lost, stolen, or destroyed, the board of directors of the corporation may authorize the issuance of a replacement certificate on such terms and conditions as the board may require, including provision for indemnification of the corporation secured by a bond or other adequate security sufficient to protect the corporation against any claim that may be made against it, including any expense or liability, on account of the alleged loss, theft or destruction of the certificate or the issuance of the replacement certificate.
Section 2
Shareholders
2.1 Annual Meetings. The corporation shall hold annual meetings of shareholders as designated by the board of directors. At the annual meeting shareholders shall elect a board of directors and may transact any other business properly brought before the meeting.
2.2 Special Meetings. The president may and the president or secretary shall, on written request of a majority of the board of directors or of shareholders owning not fewer than one-tenth of the outstanding voting shares of the corporation, call special meetings of the shareholders, for any purpose or purposes unless otherwise prescribed by statute. The written
request and the notice of the special meeting shall state the purposes of the meeting and the business transacted at the meeting shall be limited to the purposes stated in the notice.
2.3 Time and Place of Meetings. The board of directors, the president, or the secretary shall fix the time and place of all meetings of shareholders.
2.4 Voting. Subject to the articles of incorporation and the requirement for cumulative voting for the election of directors, each shareholder is entitled to one vote, in person or by proxy, for each voting share held. Shareholders entitled to vote at the meeting shall be determined as of 4 p.m. on the business day before notice of the meeting is sent. No proxy shall be voted or acted upon after eleven months from its date, unless the proxy provides for a longer period.
2.5 Notice of Meetings. The corporation shall give written notice of annual and special meetings, stating the place, date, hour, and, in the case of special meetings, the purposes of the meeting, to each shareholder entitled to vote at the meeting not less than ten nor more than 50 days before the meeting unless otherwise prescribed by statute.
2.6 List of Shareholders. The corporation shall prepare and make available, no more than two days after notice of a meeting of shareholders is sent, a complete alphabetical list of all shareholders entitled to notice of the meeting, arranged by voting groups (if any) and showing the address and the number of shares registered in the name of each shareholder. The list shall be available for inspection and copying by any shareholder.
2.7 Quorum and Adjournment. The holders of a majority of the shares entitled to vote at any meeting of the shareholders, present in person or by proxy, shall constitute a quorum for the transaction of business except as otherwise provided by statute. If a quorum is not present at any meeting, a majority of the shareholders entitled to vote and present at the meeting in person or by proxy may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum is present or represented. At an adjourned meeting, when a quorum is present, the shareholders may transact any business they might have transacted at the meeting as originally noticed. If the adjournment is for more than thirty days, or if after the adjournment a new record date is fixed for the adjourned meeting, the corporation shall give notice of the adjourned meeting to each shareholder entitled to vote at the meeting.
2.8 Majority Required. When a quorum is present at any meeting, the vote of the holders of a majority of the voting power present and voting shall decide any question brought before the meeting, unless an express provision of a statute or of the articles of incorporation requires a different vote. If a meeting commenced with a quorum, business may continue until adjournment of the meeting notwithstanding the withdrawal or temporary absence of sufficient shares to reduce the number present to less than a quorum; provided that the affirmative vote must be such as would constitute a majority if a quorum were present.
2.9 Action Without Meeting. The shareholders may take any action they could take at a meeting without a meeting, without prior notice and without a vote, if the holders of all shares entitled to vote on the action sign a written consent setting forth the action taken. Such a consent may be signed in counterparts.
2.10 Waiver of Notice. Attendance of a shareholder at a meeting: (i) waives objection to lack of notice or defective notice unless the shareholder at the beginning of the meeting objects to holding the meeting or transacting business at the meeting, and (ii) waives objection to consideration of a particular matter not within the purpose or purposes described in the meeting notice, unless the shareholder objects to considering the matter when it is presented. Any shareholder may waive notice of a meeting of shareholders by executing a written waiver of notice.
Section 3
Directors
3.1 Number and Election. The board of directors shall initially consist of four members, however, the number of directors may be changed from time to time by resolution of the board of directors. Except as provided in these Bylaws for the filling of vacancies, the shareholders shall elect the directors at the annual meeting. Each director shall hold office until a successor is elected and qualifies, or until such director's earlier resignation or removal. Directors need not be shareholders.
3.2 Vacancies. A majority of the directors then in office, though less than a quorum, or a sole remaining director may fill vacancies and newly created directorships. A director so chosen shall hold office until a successor is elected and qualifies, or until such director's earlier resignation or removal.
3.3 Powers. The board of directors shall manage the business of the corporation and may exercise all powers of the corporation and do all lawful acts and things permitted by statute or by the articles of incorporation.
3.4 Place of Meetings. The board of directors of the corporation may hold its meetings either in or out of Delaware. At the discretion of the board of directors, meetings may be held by means of conference telephone or similar communications equipment by means of which all persons participating in the meeting can hear each other.
3.5 Annual Meetings. The board of directors shall hold its annual meeting immediately following the annual meeting of shareholders at the place announced at the annual meeting of shareholders. No notice is necessary to hold the annual meeting, provided a quorum is present. If a quorum is not present, the annual meeting shall be held at the next regular meeting or as a special meeting.
3.6 Regular Meetings. The board of directors may hold regular meetings without notice at the times and places determined by the board of directors.
3.7 Special Meetings. The president or secretary may, and on written request of two directors shall, call special meetings of the board of directors on not less than one day's notice to each director personally, or by facsimile, overnight courier, telegram or telephone, or on not less than five days' notice to each director by mail.
3.8 Quorum. Except as otherwise specifically provided by statute or by the articles of incorporation, a majority of the members of the board of directors then in office shall constitute a
quorum of the board of directors. The concurrence of a majority of those present and voting shall be sufficient to conduct the business of the board. If a quorum is not present, the directors present may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum is present.
3.9 Action Without Meeting. The board of directors or any committee thereof may take any action without a meeting if all directors or members of the committee, as the case may be, consent to the action in writing. The writing or writings shall be filed with the minutes of the board of directors. Such a consent may be signed in counterparts.
3.10 Waiver of Notice. Attendance or participation of a director at a meeting waives any required notice unless the director at the beginning of the meeting or promptly on his arrival objects to holding the meeting or transacting business at the meeting and does not thereafter vote for or assent to action taken at the meeting. Any director may waive notice of any meeting by executing a written waiver of notice.
3.11 Compensation. The corporation may pay, or reimburse the directors for, the expenses of attendance at each meeting of the board of directors. The corporation may pay the directors a fixed sum for attendance at each meeting of the board of directors or a stated salary as director. Such payment shall not preclude any director from serving the corporation and receiving compensation in any other capacity. The board of directors shall establish and set forth in its minutes the amount or rate of compensation of directors.
3.12 Voting. Notwithstanding any other provision of these Bylaws to the contrary, any and all actions to be taken or approved by the board of directors (whether by an action without a meeting or at an annual meeting, a regular meeting or a special meeting) must be approved by all of the members of the board of directors.
Section 4
Officers
4.1 Appointment of Officers. The officers of the corporation shall be chosen by the board of directors at the annual meeting and may, but need not, include a president, vice president, secretary, and treasurer and such other officers and agents as the board of directors deems necessary or appropriate. Any number of offices may be held by the same person.
4.2 Tenure and Duties of Officers. Officers shall hold their offices at the pleasure of the board of directors, shall have the titles designated by the board of directors, and shall exercise the powers and perform the duties determined from time to time by the board of directors.
4.3 Compensation. The board of directors shall determine from time to time the compensation of the officers. An officer shall not be prevented from receiving compensation because of service as a director. The minutes of the meetings of the board of directors shall set forth the compensation of the officers or the method of fixing the compensation of the officers.
4.4 Vacancies. The board of directors may fill at any time a vacancy in any office because of death, resignation, removal, disqualification or otherwise.
4.5 Chairman of the Board. The chairman of the board, if one is appointed and serving, shall preside at all meetings of the shareholders and of the board of directors and shall perform any other duties the board of directors assigns.
4.6 President. If a chairman of the board is not appointed, is not serving, or is absent, the president shall preside at meetings of the shareholders and of the board of directors. Subject to policies established by the board of directors, the president shall be the chief operating officer of the corporation. The president may sign deeds, conveyances, contracts, agreements, certificates evidencing shares, and all other instruments requiring execution on behalf of the corporation.
4.7 Vice Presidents. There shall be as many vice presidents as the board of directors chooses to appoint. Vice presidents shall perform the duties assigned to them by the board of directors or the president. Any one of the vice presidents, as authorized by the board of directors, shall have all the powers and perform all the duties of the president if the president is temporarily absent or unable to act.
4.8 Secretary. The secretary shall keep, or cause to be kept, minutes of all meetings of the shareholders, board of directors and committees. The secretary is the custodian of the corporate seal, if any, and shall affix it to documents when necessary or appropriate. The secretary shall give or cause to be given required notices of all meetings of the shareholders or board of directors. The secretary shall have custody of the books and records of the corporation, except the books of account, and in general shall perform all the duties incident to the office of secretary of a corporation and such other duties as may be assigned by the board of directors or the president.
4.9 Treasurer. The treasurer shall have custody of the funds and securities of the corporation and the books of account. The treasurer shall see to the deposit of the funds of the corporation in the bank or banks the board of directors designates. The books of account shall be monitored on a current basis under the treasurer's direction and supervision. The treasurer shall render financial statements to the president and to all directors at proper times. The treasurer shall have charge of the preparation and filing of reports, financial statements, and returns as required by law. The treasurer shall give the corporation a fidelity bond as required by law or by the board of directors, with the premium therefor paid by the corporation as an operating expense.
Section 5
Committees
5.1 Committees. The board of directors may establish regular or special committees. The resolution establishing a regular or special committee shall set forth its powers and duties. In the discretion of the board of directors, persons serving on a regular or special committee need not be directors. The corporation may pay members of regular or special committees compensation for attending committee meetings.
5.2 Minutes of Committee Meetings. The chairman of each regular or special committee designated by the board of directors shall keep, or cause to be kept, minutes of meetings of such committees and shall file the minutes with the secretary of the corporation.
Section 6
Indemnification of
Directors and Officers
6.1 Indemnification. Except as provided in these Bylaws, the corporation shall hold harmless and indemnify each of its directors and officers ("indemnitee") against any and all liability and expenses incurred by indemnitee in connection with any threatened or actual proceeding or legal action resulting from indemnitee's service to the corporation or to another entity at the corporation's request on or after the date on which these Bylaws are adopted.
6.2 Exclusions. Except insofar as permitted by law, the corporation shall not indemnify indemnitee for acts by indemnitee that were grossly negligent, that resulted in personal profit or advantage to indemnitee to which indemnitee was not legally entitled, or that involved intentional misconduct or a knowing violation of law.
6.3 Procedure. Indemnitee shall notify the corporation promptly of the threat or commencement of any proceeding or legal action with respect to which indemnitee intends to seek indemnification. The corporation shall be entitled to assume indemnitee's defense with counsel reasonably satisfactory to indemnitee, unless indemnitee provides the corporation with an opinion of counsel reasonably concluding that there may be a conflict of interest between indemnitee and the corporation in the defense of the proceeding or legal action. If the corporation assumes the defense, the corporation shall not be liable to indemnitee for legal or other expenses subsequently incurred by indemnitee.
6.4 Expense Advances. The corporation shall advance automatically expenses, including attorneys' fees, incurred or to be incurred by indemnitee in defending a proceeding or legal action upon receipt of notice of the expenses. To the extent required by law, the corporation shall not advance expenses unless (i) indemnitee furnishes the corporation with a written affirmation of indemnitee's good faith belief that indemnitee has met the proper standard of conduct; (ii) indemnitee or a representative furnishes the corporation with a written undertaking to repay the advance if it is ultimately determined (after expiration or exhaustion of any appeal rights) that indemnitee did not meet the standard of conduct; and (iii) a determination is made that the facts then known to those making the determination would not preclude indemnification.
6.5 Settlement of Claims. The corporation shall not be obligated to indemnify indemnitee for any amounts incurred in settlement if settlement is made without the corporation's prior written consent. The corporation shall not enter into any settlement that would impose any penalty or limitation on indemnitee without indemnitee's prior written consent. Neither the corporation nor indemnitee will unreasonably withhold consent to any proposed settlement.
6.6 Effect of Repeal. In order that indemnitee may rely on the indemnification promised by this Section, no repeal or amendment of this Section shall reduce the right of
indemnitee to payment of expenses or indemnification for acts of indemnitee taken before the date of repeal or amendment.
Section 7
Repeal, Alteration or Amendment
These Bylaws may be repealed, altered or amended, or substitute bylaws may be adopted, only by (a) the unanimous vote/consent of the board of directors, or (b) the affirmative vote/consent of shareholders who own, on a cumulative basis, more than 80% of the issued capital stock of the corporation.
[______________]
ATTEST:
[____________]
