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EXHIBIT 99.4
AGREEMENT AND PLAN OF MERGER
AMONG
VORNADO REALTY TRUST
ATLANTA PARENT, INC.
ATLANTA STORAGE ACQUISITION CO.
AND
URS LOGISTICS, INC.
Dated as of September 26, 1997
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TABLE OF CONTENTS
Page
ARTICLE I
DEFINITIONS......................................................1
ARTICLE II
THE MERGER.......................................................8
2.1 The Merger..................................................8
2.2 Certificate of Incorporation................................9
2.3 By-Laws.....................................................9
2.4 Directors and Officers......................................9
2.5 Effective Time..............................................9
ARTICLE III
DETERMINATION OF WORKING CAPITAL;
CONVERSION OF SHARES............................................10
3.1 Working Capital Adjustment.................................10
3.2 URS Common Stock...........................................12
3.3 Warrants...................................................13
3.4 Dissenting Shares..........................................13
3.5 Acquisition Co. Common Stock...............................14
3.6 Exchange of Shares and Warrants............................14
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF URS...........................18
4.1 Organization, etc..........................................18
4.2 Authorization and Binding Obligation.......................19
4.3 Capitalization.............................................20
4.4 Consents and Approvals; No Conflicts.......................21
4.5 Financial Statements.......................................22
4.6 Undisclosed Liabilities....................................22
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4.7 Governmental Approvals and Authorizations..................23
4.8 Compliance with Laws.......................................23
4.9 Absence of Certain Payments............................23
4.10 Real Property.............................................24
4.11 Personal Property.........................................25
4.12 Intellectual Property.....................................26
4.13 Absence of Conflicts of Interest..........................27
4.14 Contracts.................................................27
4.15 Labor Matters.............................................27
4.16 Employee Benefit Plans....................................28
4.17 Actions Pending...........................................30
4.18 Affiliate Transactions....................................31
4.19 Absence of Certain Changes................................31
4.20 Insurance.................................................31
4.21 Taxes.....................................................31
4.22 Environmental Matters.....................................33
4.23 Brokers, Finders, etc.....................................34
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF VORNADO, THE PARENT AND ACQUISITION CO.......................35
5.1 Organization and Standing..................................35
5.2 Authorization and Binding Obligation.......................35
5.3 Consents and Approvals; No Conflicts.......................36
5.4 Litigation.................................................37
5.5 Finders and Investment Bankers.............................37
5.6 Financing..................................................37
ARTICLE VI
COVENANTS.......................................................37
6.1 Conduct of Business........................................37
6.2 Third-Party Consents.......................................41
6.3 Compliance with GCL; Filings...............................41
6.4 Additional Agreements......................................41
6.5 Acquisition Proposals......................................42
6.6 Public Announcements.......................................43
6.7 Consent of the Parent......................................43
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6.8 Transfer Taxes.............................................43
6.9 Treatment of Books and Records.............................43
6.10 Indemnification of Officers and Directors.................44
6.11 Access....................................................44
6.12 Repayment of Indebtedness.................................45
6.13 Post-Closing True-Up......................................45
6.14 Management Bonus Amount Arrangements......................45
ARTICLE VII
CLOSING CONDITIONS..............................................46
7.1 Conditions Precedent to the Obligations of
All Parties.....................................................46
7.2 Additional Conditions to the Obligation of
URS.............................................................46
7.3 Conditions Precedent to Obligations of the
Parent and Acquisition Co.......................................47
ARTICLE VIII
CLOSING.........................................................49
8.1 Time and Place.............................................49
8.2 Filings at the Closing; Other Actions......................49
ARTICLE IX
NON-SURVIVAL OF REPRESENTATIONS,
WARRANTIES AND COVENANTS........................................49
ARTICLE X
TERMINATION RIGHTS..............................................50
10.1 Termination...............................................50
10.2 Procedure and Effect of Termination.......................51
ARTICLE XI
OTHER PROVISIONS................................................51
11.1 Amendment and Modification................................51
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11.2 Benefit and Assignment....................................51
11.3 No Third-Party Beneficiaries..............................52
11.4 Entire Agreement..........................................52
11.5 Expenses..................................................52
11.6 Headings..................................................53
11.7 Choice of Law.............................................53
11.8 Notices...................................................53
11.9 Counterparts..............................................55
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SCHEDULES
Schedule 1.31 Knowledge
Schedule 1.34(a) and (b) Management Bonus Amount
Schedule 1.58 Warrants
Schedule 2.4 Officers of Surviving Corporation
Schedule 4.1(a) URS Qualification
Schedule 4.1(b) URS Subsidiaries; Qualification
Schedule 4.1(c) Third Party Interests
Schedule 4.3 Capitalization
Schedule 4.4 Consents and Approvals; No
Conflicts
Schedule 4.5 Financial Statements
Schedule 4.6 Undisclosed Liabilities
Schedule 4.7 Governmental Approvals and
Authorization
Schedule 4.8 Compliance with Laws
Schedule 4.10 Real Property
Schedule 4.12 Intellectual Property
Schedule 4.12(b) Certain Third Party Interests
Schedule 4.13 Conflicts of Interest
Schedule 4.14 Contracts
Schedule 4.15 Labor Matters
Schedule 4.16 Plans
Schedule 4.16(f) Retiree Health and Life Benefit
Obligations
Schedule 4.16(g) Conflicts with Employment
Arrangements
Schedule 4.17 Litigation
Schedule 4.18 Affiliate Transactions
Schedule 4.19 Adverse Changes
Schedule 4.20 Insurance
Schedule 4.21 Taxes
Schedule 4.22 Environmental Matters
Schedule 4.23 URS Finders
Schedule 5.5 Vornado Finders
Schedule 6.1 Conduct of Business
Schedule 6.1(h) Post-Signing Bonus Arrangements
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EXHIBITS
Exhibit 7.3(e) Form of Waiver Letter
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AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of September 26, 1997 (the
"Agreement"), among Vornado Realty Trust, a Maryland real estate investment
trust ("Vornado"), ATLANTA PARENT, INC. a Delaware corporation (the "Parent"),
ATLANTA STORAGE ACQUISITION CO., a Delaware corporation and a wholly-owned
subsidiary of the Parent ("Acquisition Co."), and URS LOGISTICS, INC., a
Delaware corporation ("URS").
ARTICLE I
DEFINITIONS
Unless otherwise stated, the following terms when used herein have
the meanings assigned to them below.
1.1 "Acquisition Co." has the meaning set forth in the preamble to
this Agreement.
1.2 "Affiliate" means a Person that directly, or indirectly through
one or more intermediaries, controls, or is controlled by, or is under common
control with, the Person specified.
1.3 "Aggregate Exercise Proceeds" means the aggregate Exercise Price
payable upon exercise of all of the Warrants with an Exercise Price of less than
the Per Share Price.
1.4 "Applicable Law" means all applicable provisions of all (i)
constitutions, treaties, statutes, laws (including, but not limited to, the
common law), rules, regulations, ordinances, codes or orders of any Governmental
Authority and (ii) orders, decisions, rulings, injunctions, judgments, awards
and decrees or consents of or agreements with any Governmental Authority.
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1.5 "Board" has the meaning set forth in Section 4.2(b) hereof.
1.6 "BT Credit Agreement" means the Credit Agreement, dated as of
June 2, 1995, among URS, Bankers Trust Company, as agent, and the various
lending institutions party thereto, as amended and restated as of June 27,
1997.
1.7 "Business Day," whether or not initially capitalized, means
every day of the week excluding Saturdays, Sundays and federal holidays.
1.8 "Certificate" has the meaning set forth in Section 3.6(a)
hereof.
1.9 "Certificate of Merger" has the meaning set forth in Section 2.5
hereof.
1.10 "Closing" has the meaning set forth in Section 8.1.
1.11 "Closing Date" means the date on which the Closing occurs.
1.12 "Closing Statement" has the meaning set forth in Section 3.1.
1.13 "Code" means the Internal Revenue Code of 1986, as amended,
together with all regulations and rulings issued thereunder by any Governmental
Authority.
1.14 "Contracts" has the meaning set forth in Section 4.14 hereof.
1.15 "Debt Payoff Amount" means the aggregate amount that would be
required to repay in full as of the Effective Time all indebtedness under each
of the MetLife Loan Agreement and the BT Credit Agreement, together with any
interest due and unpaid thereon and 74% of the amount
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(representing the after-tax cost to URS) of any redemption, repayment or
prepayment fees, surcharges, premiums or penalties associated therewith, as
agreed in good faith between Vornado and URS based on letters furnished to URS
by The Metropolitan Life Insurance Company and Bankers Trust Company as of or
shortly before the Closing Date.
1.16 "Dissenting Shares" has the meaning set forth in Section 3.4
hereof.
1.17 "Effective Time" has the meaning set forth in Section 2.5
hereof.
1.18 "Environmental Laws" means all Applicable Laws relating to the
protection of human health, safety or the environment.
1.19 "ERISA" means the Employee Retirement Income Security Act of
1974, as amended, together with the regulations and rulings issued thereunder
by any Governmental Authority.
1.20 "Exercise Price" means, with respect to any Warrant, the price
at which the holder of such Warrant is entitled to purchase one share of URS
Common Stock upon exercise of such Warrant.
1.21 "Filings" has the meaning set forth in Section 6.3(b) hereof.
1.22 "Financial Statements" has the meaning set forth in Section 4.5
hereof.
1.23 "GAAP" means United States generally accepted accounting
principles.
1.24 "GCL" means the General Corporation Law of the State of
Delaware.
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1.25 "Governmental Approvals" has the meaning set forth in Section
4.7 hereof.
1.26 "Governmental Authority" means any nation or government, any
state or other political subdivision thereof or any entity exercising executive,
legislative, judicial, regulatory or administrative functions of or pertaining
to government, in each case to the extent the same has jurisdiction over the
Person or property in question.
1.27 "HSRA" means the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended, and the regulations adopted thereunder.
1.28 "IRS" means the Internal Revenue Service of the United States.
1.29 "Kelso" means Kelso & Company.
1.30 "Kelso Fee" means 74% of the payment (representing the
after-tax cost to URS) to be made to Kelso at the Effective Time, as provided
for in Section 7.2(e) hereof.
1.31 "Knowledge" means, with respect to URS or any URS Subsidiary,
the actual knowledge of any of the officers set forth on Schedule 1.31 hereto.
1.32 "Leased Property" has the meaning set forth in Section 4.10
hereto.
1.33 "Liens" means all debts, liens, security interests, mortgages,
pledges, judgments, trusts, adverse claims, liabilities, encumbrances, material
rights of way, charges which are liens and other impairments of title of any
kind other than Permitted Liens.
1.34 "Management Bonus Amount" means 74% of the payments
(representing the after-tax cost to URS) to be made
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at or after the Effective Time to the individuals, and in the aggregate amount
set forth on Schedule 1.34 hereto.
1.35 "Material Adverse Effect" means a material adverse effect on
the business, assets, properties, liabilities or financial condition of URS and
the URS Subsidiaries, taken as a whole or on the ability of URS timely to
consummate the transactions contemplated hereby.
1.36 "Merger" has the meaning set forth in Section 2.1 hereof.
1.37 "Merger Consideration" means the difference of (x) the sum of
$365,000,000 plus or minus, as the case may be, the Working Capital Adjustment,
as determined pursuant to Section 3.1 minus (y) the sum of (A) the Debt Payoff
Amount, plus (B) the Management Bonus Amount, plus (C) the Kelso Fee.
1.38 "MetLife Loan Agreement" means the Loan Agreement, dated as of
December 23, 1988, by and between Metropolitan Life Insurance Company and United
Refrigerated Services, Inc., as amended by a First Amendment to Loan Agreement
dated as of January 16, 1990, a Second Amendment to Loan Agreement dated as of
October 25, 1990, a Third Amendment to Loan Agreement dated as of May 1, 1991, a
Fourth Amendment to Loan Agreement dated as of April 5, 1993, a Fifth Amendment
to Loan Agreement dated as of November 10, 1994 and a Sixth Amendment to Loan
Agreement dated as of April 16, 1997.
1.39 "Outstanding URS Shares" means the shares of URS Common Stock
issued and outstanding immediately prior to the Effective Time, assuming the
exercise of all of the Warrants with an Exercise Price of less than the Per
Share Price and the issuance of all of the shares of URS Common Stock issuable
in respect thereof.
1.40 "Owned Property" has the meaning set forth in Section 4.10
hereof.
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1.41 "Parent" has the meaning set forth in the preamble to this
Agreement.
1.42 "Per Share Price" means the sum of (i) the Merger Consideration
plus (ii) the Aggregate Exercise Proceeds divided by the total number of
Outstanding URS Shares.
1.43 "Permitted Liens" has the meaning set forth in Section 4.10
hereof.
1.44 "Person" means an individual, corporation, partnership, limited
liability company, association, trust or other entity or organization, including
any Governmental Authority or any other government or political subdivision or
an agency or instrumentality thereof.
1.45 "Plans" has the meaning set forth in Section 4.16 hereof.
1.46 "Real Property" has the meaning set forth in Section 4.10
hereof.
1.47 "Real Estate Laws" means any applicable building, zoning,
subdivision and other land use and similar laws, codes, ordinances, rules,
regulations and orders of Governmental Authorities.
1.48 "Returns" has the meaning set forth in Section 4.21 hereof.
1.49 "Surviving Corporation" has the meaning set forth in Section
2.1 hereof.
1.50 "Surviving Corporation Common Stock" has the meaning set forth
in Section 3.5 hereof.
1.51 "Tax" has the meaning set forth in Section 4.21 hereof.
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1.52 "Transfer Taxes" means all sales (including, without
limitation, bulk sales), use, value added, documentary, stamp, gross receipts,
registration, transfer, conveyance, excise, recording, license and other
similar Taxes and fees imposed by any Governmental Authority in connection with
a merger.
1.53 "URS" has the meaning set forth in the preamble to this
Agreement.
1.54 "URS Common Stock" means the common stock, par value $.10 per
share, of URS.
1.55 [Intentionally Omitted]
1.56 "URS Subsidiary" means any corporation, partnership, limited
liability company, joint venture or other entity of which URS owns, directly or
indirectly, at least a majority of the securities or other ownership interests
having by the terms thereof ordinary voting power or otherwise has the right or
power to elect a majority of the board of directors or other Persons performing
similar functions of such corporation, partnership, limited liability company,
joint venture or other entity.
1.57 "Vornado" has the meaning set forth in the preamble to this
Agreement.
1.58 "Warrants" means the warrants to purchase URS Common Stock
issued pursuant to the Warrant Agreements listed on Schedule 1.58 hereto.
1.59 "Working Capital" shall mean, as of any date of determination,
the excess, determined on a basis consistent with the preparation of the August
31 balance sheet included in the Financial Statements, of (a) the sum of (i) the
aggregate current assets, including cash and cash equivalents, short-term
investments, prepaid expenses, current deferred tax assets and other current
assets, of URS and the URS Subsidiaries on a consolidated basis as of such
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date, plus (ii) all cash expended by URS or any URS Subsidiary on or prior to
such date in respect of (A) the amounts referred to in Section 7.2(e)(i) hereof,
(B) the fee to Kelso referred to in Section 7.2(e)(ii) hereof or (C) any expense
of a type referred to in Section 11.5 hereof (the items referred to in clause
(A), (B) and (C) are collectively, the "Excluded Liabilities"), over (b) the
current liabilities, including accounts payable, current income taxes payable
and accrued expenses and any other current liabilities, of URS and the URS
Subsidiaries on a consolidated basis as of such date, other than any such
liability in respect of any Excluded Liability or any liability for any current
portion of any indebtedness under the MetLife Loan Agreement or the BT Credit
Agreement.
1.60 "Working Capital Adjustment" shall mean the difference (which
may be a positive or a negative number) between (x) $12,147,000 (i.e., Working
Capital as of August 31, 1997) and (y) Working Capital, as determined pursuant
to Section 3.1.
ARTICLE II
THE MERGER
2.1 The Merger. In accordance with the provisions of this Agreement
and the GCL, at the Effective Time (i) Acquisition Co. shall be merged with and
into URS (the "Merger"), and URS shall be the surviving corporation of the
Merger (hereinafter sometimes called the "Surviving Corporation") and shall
continue its corporate existence under the laws of the State of Delaware; (ii)
the name, identity, existence, rights, privileges, powers, franchises,
properties and assets of URS shall continue unaffected and unimpaired; and (iii)
the separate existence of Acquisition Co. shall cease, and all of the rights,
privileges, powers, franchises, properties and assets of Acquisition Co. shall
be vested in URS. The name of the surviving corporation shall be "URS Logistics,
Inc."
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2.2 Certificate of Incorporation. The Restated Certificate of
Incorporation of URS in effect immediately prior to the Effective Time shall be
the Certificate of Incorporation of the Surviving Corporation until thereafter
amended as provided therein or by law, except that Article FOURTH thereof shall
be amended and restated in its entirety as follows:
"The total number of shares of stock which the Company shall have
authority to issue is 1,000 shares of Common Stock, par value $0.001
per share."
2.3 By-Laws. The By-Laws of URS in effect immediately prior to the
Effective Time shall be the By-Laws of the Surviving Corporation until
thereafter amended, altered or repealed as provided therein.
2.4 Directors and Officers. The directors of Acquisition Co.
immediately prior to the Effective Time shall be the directors of the Surviving
Corporation, each to hold office in accordance with the Certificate of
Incorporation and By-Laws of the Surviving Corporation until his or her
successor is appointed and qualified or until his or her earlier death,
resignation or removal. The individuals set forth on Schedule 2.4 shall be the
officers of the Surviving Corporation, each to hold office in accordance with
the Certificate of Incorporation and By-Laws of the Surviving Corporation until
his or her successor is appointed and qualified or until his or her earlier
death, resignation or removal.
2.5 Effective Time. The Merger shall become effective simultaneously
with the filing of a Certificate of Merger with the Secretary of State of the
State of Delaware in accordance with Sections 251 and 103 of the GCL (the
"Certificate of Merger"). The Certificate of Merger shall be filed
simultaneously with the Closing. The date and time when the Merger shall become
effective is hereinafter referred to as the "Effective Time".
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ARTICLE III
DETERMINATION OF WORKING CAPITAL;
CONVERSION OF SHARES
3.1 Working Capital Adjustment. (a) If Working Capital as of
immediately prior to the Effective Time is less than $12,147,000 (i.e., Working
Capital as of August 31, 1997), the Merger Consideration shall be reduced by the
amount by which Working Capital as of immediately prior to the Effective Time is
less than such amount (the "Working Capital Reduction"). If Working Capital as
of the Effective Time is greater than $12,147,000, the Merger Consideration
shall be increased by the amount by which Working Capital as of the Effective
Time is greater than such amount (the "Working Capital Addition"). The dollar
value of the Working Capital Reduction or Working Capital Addition, as the case
may be, is referred to as the "Working Capital Adjustment".
(b) Not later than 10 days nor earlier than 30 days prior to the
Closing, URS shall prepare in good faith, on a basis consistent with the August
31, 1997 balance sheet included in the Financial Statements, and shall deliver
to Vornado, an estimate (the "Working Capital Estimate") of the Working Capital
Adjustment as of immediately prior to the then anticipated Effective Time, a
statement as to whether the Working Capital Adjustment is estimated to be a
Working Capital Reduction or a Working Capital Addition, and such other
supporting information and documentation as Vornado may reasonably request with
respect thereto. On the Closing Date, the Parent shall deposit into an escrow
account (the "Escrow Account") maintained by Citibank, N.A., as escrow agent
pursuant to an escrow agreement containing such terms as the parties shall
negotiate in good faith (the "Escrow Agreement"), an amount of cash (such cash,
the "Escrowed Funds") equivalent to (i) two, multiplied by (ii) the dollar value
of the Working Capital Estimate (without regard to
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whether the Working Capital Estimate reflects a Working Capital Reduction or
Working Capital Addition); provided that the Escrowed Funds shall not be less
than $3.5 million.
(c) As soon as practicable following the Effective Time, but in no
event later than 15 days following the Effective Time, Vornado shall prepare in
good faith, on a basis consistent with URS' August 31, 1997 balance sheet, and
deliver to Kelso, as representative of the former holders of URS Common Stock, a
calculation (the "Working Capital Calculation") of the Working Capital
Adjustment as of the Effective Time, together with such supporting information
and documentation as Kelso may reasonably request with respect thereto.
(d) During the 15-day period following Kelso's receipt of the
Working Capital Calculation, the Surviving Corporation shall provide Kelso
reasonable access, during normal business hours, and upon reasonable notice, to
URS' accounting and financial records and Vornado's working papers relating to
the Working Capital Adjustment; provided that such access does not unreasonably
disrupt the normal operations of URS. The Working Capital Calculation shall
become final and binding upon the parties, and the Working Capital Adjustment
shall be conclusively determined for purposes of this Agreement at the
conclusion of such 15-day period, or earlier if Kelso accepts in writing the
Working Capital Calculation, unless Kelso gives written notice of its
disagreement with the Working Capital Calculation (a "Notice of Disagreement")
to Vornado prior to the end of such period. Any notice of Disagreement shall (i)
specify in reasonable detail the nature of any disagreement so asserted and (ii)
include only disagreements based on (x) mathematical errors or (y) the Working
Capital Calculation not being calculated in accordance with this Agreement. If a
Notice of Disagreement is received by Vornado in a timely manner, then the
Working Capital Calculation shall become final and binding upon the parties and
the holders of URS Common Stock, and the Working Capital Adjustment shall be
conclusively determined for purposes of
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this Agreement, on the earlier of (i) the date Vornado and Kelso resolve in
writing any differences they have with respect to the matters specified in the
Notice of Disagreement, or (ii) the date any disputed matters are finally
resolved in writing by the Arbitrating Auditor (as defined below).
(e) During the 15-day period following the delivery of a Notice of
Disagreement, Vornado and Kelso shall seek in good faith to resolve in writing
any differences which they may have with respect to the matters specified in the
Notice of Disagreement and URS shall provide Kelso with reasonable access,
during normal business hours, and upon reasonable notice, to URS' accounting and
financial records and Vornado's working papers relating to the Working Capital
Calculation; provided that such access does not unreasonably disrupt the normal
operations of URS. At the end of such 15-day period, Vornado and Kelso shall
submit to the final and unappealable decision of such New York City office of a
"Big Six" auditing firm that is independent with respect to Kelso, URS and
Vornado as shall be selected by mutual agreement of Vornado and Kelso (such
independent auditor, the "Arbitrating Auditor") for review and resolution of any
and all matters which remain in dispute and which were properly included in the
Notice of Disagreement. Vornado and Kelso agree to use reasonable efforts to
cause the Arbitrating Auditor to render a decision resolving the matters
submitted to it within 15 days following submission of the matter thereto.
3.2 URS Common Stock. (a) At the Effective Time, by virtue of the
Merger and without any action on the part of the holder thereof, each share of
URS Common Stock (except for (i) any shares of URS Common Stock then owned
beneficially or of record by the Parent or Acquisition Co. or any other
subsidiary of the Parent, (ii) shares of URS Common Stock then held in the
treasury of URS or by any URS Subsidiary, and (iii) Dissenting Shares) issued
and outstanding immediately prior to the Effective Time shall be converted into
the right to receive cash from the Parent in
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an amount equal to the Per Share Price, as determined pursuant to Section 1.42.
(b) Each share of URS Common Stock which is then owned beneficially
or of record by the Parent or Acquisition Co. or any other direct or indirect
subsidiary of the Parent shall, by virtue of the Merger and without any action
on the part of the holder thereof, be canceled and retired and cease to exist,
without any conversion thereof.
(c) Each share of URS Common Stock held in URS's treasury or by any
URS Subsidiary immediately prior to the Effective Time shall, by virtue of the
Merger, be canceled and retired and cease to exist, without any conversion
thereof.
(d) The holders of shares of URS Common Stock shall, as of the
Effective Time, cease to have any rights as stockholders of URS, except such
rights, if any, as they may have pursuant to Section 262 of the GCL, or
alternatively, the right to receive their pro rata share of the Merger
Consideration, as determined and paid in the manner set forth in this Agreement.
3.3 Warrants. At the Effective Time, by virtue of the Merger and
without any action on the part of the holder thereof, each Warrant with an
Exercise Price that is less than the Per Share Price issued and outstanding
immediately prior to the Effective Time shall be converted into the right to
receive cash from the Parent in an amount equal to the product of (i) the number
of shares of URS Common Stock into which such Warrant is exercisable times (ii)
the excess of the Per Share Price, as determined pursuant to Section 3.1, over
the Exercise Price for such Warrant. URS shall cause each Warrant having an
Exercise Price equal to or in excess of the Per Share Price to be cancelled. In
this regard, URS will take all actions required under the Warrant Plan governing
the Warrants.
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3.4 Dissenting Shares. Notwithstanding anything in this Agreement to
the contrary, shares of URS Common Stock which are held by stockholders who
shall have effectively dissented from the Merger and perfected their appraisal
rights in accordance with the provisions of Section 262 of the GCL (the
"Dissenting Shares"), shall not be converted into or be exchangeable for the
right to receive any Merger Consideration, but the holders thereof shall be
entitled to payment from the Surviving Corporation of the appraised value of
such shares in accordance with the provisions of Section 262 of the GCL;
provided, however, that if any such holder shall have failed to perfect such
appraisal rights or shall have effectively withdrawn or lost such rights, his or
her shares of URS Common Stock shall thereupon be converted into and
exchangeable for, at the Effective Time, their pro rata share of the Merger
Consideration, as determined and paid in the manner set forth in this Agreement.
3.5 Acquisition Co. Common Stock. Each share of common stock, par
value $.01 per share, of Acquisition Co. (the "Acquisition Co. Common Stock"),
issued and outstanding immediately prior to the Effective Time shall, by virtue
of the Merger and without any action on the part of the holder thereof, be
converted into and exchangeable for one fully paid and non-assessable share of
common stock, par value $.10 per share, of the Surviving Corporation ("Surviving
Corporation Common Stock"). From and after the Effective Time, each outstanding
certificate theretofore representing shares of Acquisition Co. Common Stock
shall be deemed for all purposes to evidence ownership of and to represent the
number of shares of Surviving Corporation Common Stock into which such shares of
Acquisition Co. Common Stock shall have been converted. Promptly after the
Effective Time, the Surviving Corporation shall issue to the Parent a stock
certificate or certificates representing 1,000 shares of Surviving Corporation
Common Stock in exchange for the certificate or certificates which formerly
represented shares of Acquisition Co. Common Stock, which shall be canceled.
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3.6 Exchange of Shares and Warrants. (a) On and after the Closing
Date, each holder of an outstanding certificate or certificates which prior
thereto represented shares of URS Common Stock (the "Stock Certificates") shall,
upon surrender to the Surviving Corporation of such Stock Certificate or Stock
Certificates, be entitled to the amount of cash into which the aggregate number
of shares of URS Common Stock previously represented by such Stock Certificate
or Stock Certificates surrendered shall have been converted into the right to
receive pursuant to this Agreement. In addition, on the Closing Date, each
holder of an outstanding Warrant which prior thereto represented the right to
purchase shares of URS Common Stock in accordance with the terms of the
applicable Warrant Agreement (the "Warrant Certificates" and together with the
Stock Certificates, the "Certificates") shall, upon surrender to the Exchange
Agent of such Warrant Certificate or Warrant Certificates to the Surviving
Corporation, be entitled to the amount of cash into which such Warrant
Certificate or Warrant Certificates have been converted pursuant to Section 3.3
of this Agreement. All payments in respect of shares of URS Common Stock and
Warrants the Certificates for which are surrendered on the Closing Date shall be
made by the Parent in immediately available funds on the Closing Date, which
shall be paid in respect of each share of URS Common Stock and each Warrant as
follows:
(i) Payments in respect of the portion of the Per Share Price
attributable to the portion of the Merger Consideration not deposited in
the Escrow Account shall be made by the Parent in immediately available
funds on the Closing Date (in exchange for Stock Certificates which are
surrendered on the Closing Date) or as soon as practicable following
surrender of the related Certificates (in the case of Certificates
surrendered following the Closing Date).
(ii) If the Working Capital Adjustment is a Working Capital
Addition, then, promptly following the final determination thereof,
payments in respect of the
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portion of the Per Share Price attributable to any Working Capital
Addition shall be disbursed from the Escrow Account to the holders of
shares of URS Common Stock and to the holders of Warrants pro rata
according to their holdings (calculated on a fully-diluted basis), with
the remaining escrowed funds disbursed to Vornado, in each case as soon as
practicable following determination of the Working Capital Adjustment in
accordance with Section 3.1 and, in the case of disbursements to holders
of shares or Warrants, following the surrender of the related
Certificates.
(iii) If the Working Capital Adjustment is a Working Capital
Reduction, then, promptly following the determination thereof, a payment
equivalent to the Working Capital Reduction shall be disbursed from the
Escrow Account to Vornado, with the remaining escrowed funds disbursed
from the Escrow Account to the holders of shares of URS Common Stock and
to the holders of Warrants pro rata according to their holdings
(calculated on a fully-diluted basis), in each case as soon as practicable
following determination of the Working Capital Adjustment in accordance
with Section 3.1 and, in the case of disbursements to holders of shares or
Warrants, following the surrender of the related Certificates.
All disbursements from the Escrow Account shall be made in
accordance with the provisions of the Escrow Agreement. With respect to any
Certificate alleged to have been lost, stolen or destroyed, the owner or owners
of such Certificate, other than the URS Shareholders, shall be entitled to the
consideration set forth above upon delivery to the Surviving Corporation of an
affidavit of such owner or owners setting forth such allegation and an indemnity
agreement to indemnify the Parent and the Surviving Corporation against any
claim that may be made against either or both of them on account of the alleged
loss, theft or destruction of any such Certificate or the delivery of the
payment set forth above.
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(b) If consideration is to be delivered to a Person other than the
Person in whose name the Certificate surrendered in exchange therefor is
registered, it shall be a condition to delivery of the consideration that the
Certificate so surrendered shall be properly endorsed or otherwise in proper
form for transfer and that the Person requesting such consideration shall pay
any transfer or other Taxes required by reason of the payment to a Person other
than the registered holder of the Certificate surrendered or establish to the
satisfaction of the Surviving Corporation that such Tax has been paid or is not
applicable.
(c) Until surrendered in accordance with the provisions of this
Section 3.6, from and after the Effective Time, each Certificate (other than (i)
Certificates representing shares of URS Common Stock owned beneficially or of
record by the Parent, Acquisition Co. or any other subsidiary of the Parent,
(ii) Certificates representing shares of URS Common Stock held in URS's treasury
or by any URS Subsidiary and (iii) Dissenting Shares in respect of which
appraisal rights are perfected) shall represent for all purposes the right to
receive cash pursuant to Section 3.2(a) or 3.3, as applicable, as determined
and paid in the manner set forth in this Agreement.
(d) After the Effective Time there shall be no transfers on the
stock transfer books of the Surviving Corporation of the shares of URS Common
Stock or Warrants that were outstanding immediately prior to the Effective Time.
If, after the Effective Time, Certificates are presented to the Surviving
Corporation, they shall be canceled and exchanged for the applicable
consideration referred to in Section 3.6(c) hereof.
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ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF URS
URS hereby represents and warrants to Vornado, the Parent and
Acquisition Co. as follows:
4.1 Organization, etc. (a) URS is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware
and has all requisite corporate power and authority to own, lease and operate
its properties and to carry on its business as now being conducted. URS is duly
qualified or licensed and in good standing to do business in each jurisdiction
in which the property owned, leased or operated by it or the nature of the
business conducted by it makes such qualification necessary, except where the
failure to be so qualified or licensed would not individually or in the
aggregate have a Material Adverse Effect or materially restrict the ability of
URS to conduct business as presently conducted by it in such jurisdiction. Each
jurisdiction where URS is so qualified is listed on Schedule 4.1(a) hereto.
Except as set forth on Schedule 4.1(b) hereto, there are no URS Subsidiaries
and, except as set forth on Schedule 4.1(b) hereto, URS does not own, directly
or indirectly, any capital stock of or equity interests in any Person. URS has
heretofore delivered or made available to the Parent accurate and complete
copies of the Restated Certificate of Incorporation and By Laws of URS, as
amended and in effect on the date hereof. The stock certificate books and
ledgers of URS, which have been made available to the Parent - accurately
reflect, at the date hereof, the ownership of the issued and outstanding capital
stock of URS.
(b) Each URS Subsidiary is listed on Schedule 4.1(b) hereto, is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation and has all requisite corporate power
and authority to own, lease and operate its properties and to carry out its
business as now being conducted. Each
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URS Subsidiary is duly qualified or licensed and in good standing to do business
in each jurisdiction in which the property owned, leased or operated by it or
the nature of the business conducted by it makes such qualification necessary,
except where the failure to be so qualified or licensed would not individually
or in the aggregate have a Material Adverse Effect or materially restrict the
ability of such URS Subsidiary to conduct business as presently conducted by it
in such jurisdiction. Each jurisdiction where each URS Subsidiary is so
qualified is listed on Schedule 4.1(b) hereto. URS has heretofore delivered to
the Parent accurate and complete copies of the Certificate of Incorporation and
By Laws of each URS Subsidiary, as amended and in effect on the date hereof.
(c) Except as set forth on Schedule 4.1(c) hereto, URS owns of
record and beneficially 100% of the issued and outstanding capital stock and all
other equity interests in each URS Subsidiary, free and clear of any Liens.
4.2 Authorization and Binding Obligation. (a) URS has all necessary
corporate power and authority to execute and deliver this Agreement and to
consummate the transactions contemplated hereby. URS's execution, delivery and
performance of this Agreement has been duly and validly authorized by all
necessary corporate action on the part of URS and this Agreement has been duly
executed and delivered by URS. Except for the actions referred to in Section
4.2(b) hereof, which actions are in full force and effect, and the giving of
notice in accordance with Section 228(d) of the GCL, no other corporate action
or proceedings on the part of URS are necessary to authorize this Agreement or
the consummation of the transactions contemplated hereby. This Agreement
constitutes the valid and binding obligation of URS, enforceable against URS in
accordance with its terms, except as may be limited by applicable bankruptcy,
insolvency, reorganization, moratorium or similar rights of creditors generally
and by general principles of equity.
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(b) The URS Board of Directors (the "Board") has authorized the
execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby and has not withdrawn such authorization.
Subsequent to the giving of such authorization, Kelso Investment Associates IV,
L.P., as the beneficial and record owner of the URS Common Stock as set forth in
Schedule 4.3 hereto, has executed and not withdrawn an action by written consent
in lieu of meeting of stockholders adopting this Agreement. A true and complete
copy of such approvals by the Board and such consent of Kelso Investment
Associates IV, L.P. has been delivered to the Parent.
4.3 Capitalization. (a) The authorized URS Common Stock and other
authorized capital stock of URS and each of the URS Subsidiaries is as set forth
on Schedule 4.3 hereto. All issued and outstanding shares of URS Common Stock
and other equity interests of URS and each of the URS Subsidiaries are duly
authorized, validly issued, fully paid, non-assessable and free of preemptive
rights. Schedule 4.3 hereto sets forth the name of each Person who owns
beneficially or of record any shares of URS Common Stock, each Person who owns
beneficially or of record any shares of capital stock and other equity interests
of any URS Subsidiary and, in the case of URS and each URS Subsidiary, the
number of shares owned by each such Person.
(b) Except as set forth on Schedule 4.3 hereto, there are not now,
and at the Effective Time there will not be, any options, warrants, calls,
subscriptions, or other rights or other agreements or commitments of any nature
whatsoever obligating URS or any of the URS Subsidiaries to issue, transfer,
deliver or sell, or cause to be issued, transferred, delivered or sold, any
additional shares of URS Common Stock or other equity interest of URS or any of
the URS Subsidiaries, or any securities or obligations convertible into or
exchangeable for any such URS Common Stock or other equity interests, or
obligating URS or any of the URS Subsidiaries to grant, extend or enter into any
such agreement or commitment and no authorization therefor has
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been given or made by URS or any URS Subsidiary. Except for the arrangements
described in Schedule 4.3 hereto, there are no contractual arrangements that
obligate URS or any URS Subsidiary to (i) repurchase, redeem or otherwise
acquire any of its capital stock or its other equity interests or (ii) pay any
Person any consideration that is calculated with reference to the consideration
to be paid to the URS Stockholders under this Agreement.
4.4 Consents and Approvals; No Conflicts. Except for applicable
requirements of the HSRA and as set forth on Schedule 4.4 hereto and the
approvals referred to in Section 4.2(b) hereof, the giving of notice in
accordance with Section 228(d) of the GCL and the filing and recordation of the
Certificate of Merger as required by the GCL, no filing with, and no permit,
authorization, consent or approval of, any Governmental Authority or other third
party is necessary for the consummation by URS of the transactions contemplated
by this Agreement, except where the failure to make such filing or obtain such
authorization, consent or approval would not individually or in the aggregate
have a Material Adverse Effect. Neither the execution and delivery of this
Agreement by URS nor the consummation by URS of the transactions contemplated
hereby, nor compliance by URS with any of the provisions hereof, will (i) result
in any violation of any provision of the Certificate of Incorporation or By Laws
of URS or any URS Subsidiary, (ii) violate any Applicable Law or (iii) except as
set forth on Schedule 4.4 hereto, result in a violation or breach of, or
constitute (with or without due notice or lapse of time or both) a default or
give rise to a right of any Person to terminate, cancel or accelerate the
payment or performance of any liability, obligation or commitment under any
contract (including any Contract listed in Schedule 4.14 hereto) to which URS or
any of the URS Subsidiaries is a party, or by which any of their respective
properties are bound, except, in the case of clauses (ii) and (iii) above, where
such violation, breach, default or right of termination, cancellation or
acceleration would not individually or in the aggregate have a Material Adverse
Effect.
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4.5 Financial Statements. URS has furnished the Parent with (i) a
consolidated balance sheet of URS as at December 31, 1996 and consolidated
statements of operations, changes in stockholders' equity (deficit) and cash
flows of URS for such year, together with the related audit report of Deloitte &
Touche and (ii) an unaudited consolidated balance sheet of URS as at August 31,
1997 and a consolidated statement of operations of URS for the eight-month
period ended August 31, 1997. All such financial statements are referred to
herein collectively as the "Financial Statements". Other than as set forth in
Schedule 4.5 hereto, the Financial Statements (including any related schedules
and/or notes) have been prepared in accordance with GAAP consistently applied
throughout the periods presented, except that the unaudited financial statements
are subject to year-end adjustments and do not contain footnotes. The balance
sheets included in the Financial Statements fairly present, in all material
respects, the financial position of URS and the URS Subsidiaries as at the date
thereof, and the statements of operations, changes in stockholders' equity
(deficit) and cash flows included in the Financial Statements fairly present, in
all material respects, the results of the operations, changes in stockholders'
equity (deficit) and cash flows, respectively, of URS and the URS Subsidiaries
for the periods indicated.
4.6 Undisclosed Liabilities. Except (i) to the extent reflected or
reserved against in the August 31, 1997 balance sheet of URS included in the
Financial Statements, (ii) to the extent specifically set forth on Schedule 4.6
hereto, and/or (iii) for obligations of URS arising in the ordinary course of
the performance of its responsibilities under any Contracts (as defined in
Section 4.14 hereof) listed on Schedule 4.14 or any agreement which is not
required to be listed on Schedule 4.14 because of the limitations set forth in
Section 4.14, neither URS nor any URS Subsidiary has any liabilities or
obligations of any nature, whether liquidated, unliquidated, accrued, absolute,
contingent or otherwise which individually or in the aggregate would have a
Material Adverse Effect.
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4.7 Governmental Approvals and Authorizations. Except as set forth
in Schedule 4.7 hereto, all approvals, permits, qualifications, authorizations,
licenses, franchises, consents, orders, registrations or other approvals
(collectively, the "Governmental Approvals") of all Governmental Authorities
which are necessary in order to permit URS and the URS Subsidiaries to carry on
their respective businesses have been obtained and are in full force and effect,
except where the failure to obtain such approval, permit, qualification,
authorization, license, franchise, consent, order, registration or other
approval, or the failure to be in full force and effect, would not individually
or in the aggregate have a Material Adverse Effect. There has been no violation,
cancellation, suspension or revocation of any Governmental Approval. This
Section 4.7 does not relate to environmental matters, which are the subject of
Section 4.22.
4.8 Compliance with Laws. Except as set forth on Schedule 4.8,
neither URS nor any URS Subsidiary is in conflict with or in violation or
breach of or default under (a) any Applicable Law or (b) any provision of its
organizational documents, and since December 31, 1996, neither URS nor any URS
Subsidiary has received any written notice alleging any such conflict,
violation, breach or default, except for any such violations, breaches or
defaults which would not individually or in the aggregate have a Material
Adverse Effect. This Section 4.8 does not relate to environmental matters, which
are the subject of Section 4.22.
4.9 Absence of Certain Payments. None of Kelso, URS, any URS
Subsidiary, or any director, officer, employee or agent of, or consultant or
other representative of, URS or any URS Subsidiary, or any other Person
authorized to act on behalf thereof, has unlawfully offered, paid or agreed to
pay, directly or indirectly, any money or anything of value to or for the
benefit of any individual who is or was an official or employee or candidate for
office of any Governmental Authority, or any employee or agent of any
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customer or supplier of URS or any URS Subsidiary, except for any such offer,
payment or agreement to pay which would not individually or in the aggregate
have a Material Adverse Effect and would not reasonably be expected to subject
URS or any URS Subsidiary to any damage or penalty in any civil, criminal or
governmental litigation or proceeding.
4.10 Real Property. Schedule 4.10 hereto sets forth a complete list
of (i) all real property and all interests in real property owned in fee by URS
or the URS Subsidiaries (individually, an "Owned Property") and (ii) all real
property and all interests in real property leased by URS or the URS
Subsidiaries (individually, a "Leased Property"; together with the Owned
Property, the "Real Property"). URS and the URS Subsidiaries have (i) good,
marketable and insurable fee title to all Owned Property, and (ii) good and
valid leasehold interests in all Leased Property, and in the case of all of the
Owned Properties and those leasehold estates covered by the applicable title
insurance policies and update letters or endorsements (as the case may be) set
forth on Schedule 4.10 hereto, such title is free and clear of any Liens, except
(a) those created or permitted under the BT Credit Agreement or the MetLife Loan
Agreement, (b) as disclosed in those certain title insurance policies and update
letters or endorsements, as the case may be, set forth on Schedule 4.10 hereto,
and (c) other easements, rights of way and minor and immaterial liens, charges
or encumbrances that do not interfere with the use of the Real Property in the
normal conduct of the business of URS and the URS Subsidiaries and that do not
materially impair the value of the Real Property (collectively, the "Permitted
Liens"). Complete and correct copies of each lease relating to the Leased
Property described on Schedule 4.10 hereto have been furnished or made
available to the Parent. The current use and operation of the Real Property does
not violate in any material respect any instrument of record affecting the Real
Property. Except as disclosed on Schedule 4.10 hereto, no damage or destruction
has occurred and, to the Knowledge of URS, no condemnation or rezoning
proceeding has been threatened or
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commenced with respect to any of the Real Property that would individually or in
the aggregate materially impair the continued use or operation of the Owned
Property or the Leased Property. The Owned Property is in compliance with all
Real Estate Laws, and neither URS nor any URS Subsidiary has any Knowledge of
any written notice of violation or claimed violation of any Real Estate Law, in
either case except where such violation or lack of compliance would not,
individually or in the aggregate, materially restrict the ability of URS or any
URS Subsidiary to conduct its business as presently conducted by it at any
location. Except as disclosed on Schedule 4.10 hereto, neither URS nor any URS
Subsidiary is obligated under or a party to any option, right of first refusal
or other contractual right to purchase, acquire, sell or dispose of any Real
Property. Neither URS nor any URS Subsidiary is a lessor, sublessor or grantor
under any lease, sublease or other instrument granting to another Person any
right to the possession, lease, occupancy or enjoyment of the Real Property,
other than pursuant to the agreements listed on Schedule 4.14 hereto. This
Section 4.10 does not relate to environmental matters, which are the subject of
Section 4.22.
4.11 Personal Property. URS has previously delivered to the Parent a
schedule, as of December 31, 1996, which schedule includes a complete list of
each item of tangible personal property or assets owned by URS or any URS
Subsidiary having a value of $5,000 or more. URS and each of the URS
Subsidiaries has good and valid title to all tangible personal property and
assets which it owns, including the material tangible personal property
reflected in the August 31, 1997 balance sheet included in the Financial
Statements as being owned by URS or such URS Subsidiary, as the case may be,
except for such tangible personal property and assets disposed of in the
ordinary course of business, consistent with past practice, since August 31,
1997 having a value not in excess of $250,000. URS and each of the URS
Subsidiaries has a valid legal right to use all tangible personal property and
assets which it does not own but uses in the conduct of its business, except
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where the failure to have such valid legal right would not individually or in
the aggregate have a Material Adverse Effect.
4.12 Intellectual Property. (a) URS and each URS Subsidiary
possesses all patents, trademarks, service marks, trade names, copyrights and
licenses that are necessary for the use or ownership of its respective
properties and assets, and the maintenance and operation of its respective
businesses as currently conducted. Neither URS nor any URS Subsidiary uses any
registered trademarks, trade names, copyrights or patents (or have applications
therefor pending) in connection with their respective businesses, except for
those set forth on Schedule 4.12 hereto (collectively referred to as the
"Intellectual Property"). Except as set forth on Schedule 4.12 hereto, the
Intellectual Property is owned by URS or a URS Subsidiary, as indicated Schedule
4.12 hereto, and are not subject to any license, royalty arrangement or dispute.
To the Knowledge of URS, no registered trademark or trade name used by URS or
any URS Subsidiary infringes on any trademark or trade name in any state or
country in which such trademark or trade name is used by URS or such URS
Subsidiary. Neither URS nor any URS Subsidiary has received written notification
of infringement of any patent, copyright, trademark or trade name, or any
application therefor, from any Person.
(b) Each of URS and each URS Subsidiary possesses the right to use
all of its logistics and RF software and related data bases that are necessary
for the conduct of its respective operations as currently conducted. To the
Knowledge of URS, no other Person has any material interest in any such software
or data bases (other than any licensee or licensor thereof which is not an
officer, director or Affiliate of URS or any URS Subsidiary).
4.13 Absence of Conflicts of Interest. Except as set forth on
Schedule 4.13 hereto, none of the URS Stock-
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holders nor any officer, director or Affiliate of URS or any URS Subsidiary has
any material interest in any material contract or material property (real or
personal), tangible or intangible, used in the business of URS or any URS
Subsidiary.
4.14 Contracts. Schedule 4.14 hereto lists (or describes in the case
of oral contracts) each contract, note, debt instrument, lease, sublease,
warehouse services agreement, covenant not to compete, supply agreement,
guarantee, licensing agreement, partnership agreement, joint venture agreement,
employment agreement (other than employment agreements set forth on Schedule
4.16 hereto), collective bargaining agreement or other agreement or commitment
of any kind, whether written or oral, to which URS or any URS Subsidiary is a
party (other than agreements set forth on Schedule 4.16 hereto) or by which
either of them is bound (each, a "Contract"), provided that such Schedule need
not list (i) any written or oral Contract or related written Contracts under
which the aggregate payments required to be made by or to URS or any URS
Subsidiary over the life of the Contract or Contracts are less than $300,000,
(ii) any rate quote or (iii) any warehouse receipt. Complete copies of every
written Contract listed on Schedule 4.14 hereto have been previously made
available to the Parent. Each of URS and the URS Subsidiaries has performed all
material obligations required to be performed by it to date under the Contracts
(and every employment contract listed on Schedule 4.16 hereto), and neither URS
nor any URS Subsidiary has received written (or, to the Knowledge of URS, oral)
notice that it is in material default in the performance of any of its
obligations under any Contract.
4.15 Labor Matters. Except as described on Schedule 4.15 hereto,
since December 31, 1996, there have been no work stoppages or labor difficulties
relating to employees of URS or the URS Subsidiaries. There are no labor
disputes currently subject to any unfair labor practice complaint, grievance
procedure, arbitration or litigation, nor is there any default or any event
which, with
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notice or the passage of time or both, would become a default, under any
agreement with any labor union or association representing employees of URS or
any URS Subsidiary, except for any such dispute, procedure, arbitration,
litigation or default which would not individually or in the aggregate have a
Material Adverse Effect. There are no strikes, picketing, work stoppages or
representation petitions pending or, to URS's Knowledge, threatened with respect
to any employee of URS or any URS Subsidiary.
4.16 Employee Benefit Plans. (a) Schedule 4.16 hereto contains a
true and complete list of each "employee benefit plan", as such term is defined
in Section 3(3) of ERISA, and each bonus, medical incentive or deferred
compensation, severance, retention, change in control, equity incentive or other
material employee benefit plan, program or policy maintained or contributed to
by URS or any URS Subsidiary for the benefit of its respective employees or
former employees or with respect to which URS or a URS Subsidiary is obligated
to contribute on behalf of its employees and current or former directors
(collectively, the "Plans"). URS has made available to the Parent true and
complete copies of all Plans; all related trust agreements and insurance
contracts forming a part of any Plans; the most recent actuarial and trust
reports prepared for any such Plan; the most recent Form 5500 filed in respect
of each such Plan and all schedules thereto; the most recent determination
letter issued in respect of each such Plan; the current summary plan
descriptions with respect to such Plans for which such a description has been
distributed; and all amendments to any such document.
(b) Each Plan intended to be qualified under Section 401(a) of the
Code has received a favorable determination letter from the IRS with respect to
"TRA" (as defined in Section 1 of Rev. Proc. 93-39) as to the qualification
thereof under Section 401(a) of the Code and, to the Knowledge of URS, no
amendment has been made to any such Plan since the date of such determination
letter that has or would result in the disqualification of such Plan
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under Section 401(a) of the Code. Each of the Plans has been operated and
administered in all material respects in accordance with applicable laws,
including but not limited to ERISA and the Code. There are no material pending
or, to the Knowledge of URS, threatened claims by or on behalf of any of the
Plans or by any employee participating therein (other than routine claims for
benefits). All contributions required to have been made by URS and the URS
Subsidiaries to any Plan pursuant to applicable law (including, without
limitation, ERISA and the Code) have been made on a timely basis. Neither URS
nor any of the URS Subsidiaries has engaged in a transaction with respect to any
Plan that, assuming the taxable period of such transaction expired as of the
date hereof, could subject URS or any of the URS Subsidiaries to a tax or
penalty imposed by either Section 4975 of the Code or Section 502(i) of ERISA in
an amount which could be material.
(c) As of the date hereof, no liability under Title IV of ERISA
(other than for the payment of premiums under Section 4007) has been or is
expected to be incurred by URS or any URS Subsidiary with respect to any
ongoing, frozen or terminated "single employee plan", within the meaning of
Section 4001(a)(15) of ERISA, currently or formerly maintained by any of them.
(d) No Plan is or within the preceding six years has been a
multiemployer plan within the meaning of Section 4001(a)(3) of ERISA or a
multiple employer plan within the meaning of Section 4063 or 4064 of ERISA.
(e) Except for URS and each URS Subsidiary, no other trade or
business, whether or not incorporated, is currently or, within the preceding six
years, has been required to be treated as a "single employer" with URS pursuant
to clause (b), (c) or (m) of Section 414 of the Code.
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(f) Neither URS nor any URS Subsidiary has any obligations for
retiree health and life benefits under any Plan, except as set forth on Schedule
4.16(f).
(g) Except as set forth on Schedule 4.16(g) hereto, the consummation
of the transactions contemplated by this Agreement will not (i) entitle any
employees of URS or any URS Subsidiary to severance pay, (ii) accelerate the
time of payments or vesting or trigger any payment of compensation or benefits
under, increase the amount payable or trigger any other material obligation
pursuant to, any Plan or (iii) result in any breach or violation of, or a
default under, any of the Plans.
4.17 Actions Pending. Except as set forth in Schedule 4.17 hereto,
there is no civil, criminal or administrative action, suit, hearing, claim,
litigation, proceeding or investigation pending or, to the Knowledge of URS,
threatened, against or affecting URS or any URS Subsidiary or the business or
any of the assets of URS or any URS Subsidiary, or which seeks to enjoin or
prohibit, or otherwise questions the validity of, any action taken or to be
taken in connection with this Agreement, and there is no order, decision,
ruling, injunction, judgment, award or decree or consent of or agreements with
any Governmental Authority against or affecting URS or any URS Subsidiary or the
business or assets of URS or any URS Subsidiary, or which enjoins or prohibits,
any action taken or to be taken in connection with this Agreement.
4.18 Affiliate Transactions. Except as set forth on Schedule 4.18
hereto, there are no existing agreements, understandings or arrangements between
URS or any URS Subsidiary, on the one hand, and any Affiliate of URS or any URS
Subsidiary, on the other hand.
4.19 Absence of Certain Changes. Except as set forth on Schedule
4.19 hereto, since August 31, 1997, (a) URS and the URS Subsidiaries have
conducted their respective businesses in the ordinary and usual course of
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their respective businesses, and (b) there has not been any change in the
financial condition, assets, owned or leased properties, business or results of
operations of URS or any URS Subsidiary that, individually or in the aggregate,
has had a Material Adverse Effect and (c) neither URS nor any URS Subsidiary has
taken any action of the type described in any clause of Section 6.1.
4.20 Insurance. Schedule 4.20 hereto lists all material insurance
policies maintained by, or for the benefit of, URS or any URS Subsidiary, as an
insured. All such insurance policies are in full force and effect, all premiums
due thereon have been paid and no notice of termination of any such policy has
been received by the insured thereunder.
4.21 Taxes. Except as set forth on Schedule 4.21 hereto, or as
reflected or reserved against in the December 31, 1996 balance sheet included
in the Financial Statements, (i) URS and the URS Subsidiaries have (or by the
Closing Date will have) duly and timely filed or caused to be filed all Tax
Returns that are required to be filed on or before the Closing Date or the time
for filing such returns shall have been validly extended to a date after the
Closing Date (collectively, the "Returns"), except to the extent that the
failure to so file would not individually or in the aggregate have a Material
Adverse Effect; (ii) URS and the URS Subsidiaries have paid all Taxes shown or
required to be shown on such Returns, and have (or by the Closing Date will
have) withheld and remitted to the appropriate Taxing Authority, all Taxes that
are required to be withheld on or before the Closing Date, except to the extent
that the failure to so pay, withhold or remit would not individually or in the
aggregate have a Material Adverse Effect; (iii) no claim in writing by the IRS
or any other Taxing Authority for assessment or collection of Taxes, that are or
may become payable by URS or the URS Subsidiaries or chargeable as a Lien upon
the assets thereof, has been received by URS or any URS Subsidiary; (iv) Federal
income tax returns for the taxable years of URS through the taxable year ended
1991
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have been examined and closed; (v) neither URS nor any URS Subsidiary has
granted any extension or waiver of the limitation period applicable to any
Returns, which period (after giving effect to such extension or waiver) has not
yet expired; (vi) neither URS nor any URS Subsidiary has received any notice in
writing of any claim, audit, action, suit, proceeding or investigation now
pending against or with respect to URS or any URS Subsidiary in respect of any
Tax; (vii) there are no requests for rulings or determinations in respect of
any Tax pending between URS or any URS Subsidiary, on the one hand, and any
Taxing Authority on the other; (viii) neither URS nor any URS Subsidiary has (A)
been a member of an affiliated group, or (B) filed or been included in a
combined, consolidated or unitary Return, in each case involving group members
other than URS and the URS Subsidiaries; and (ix) neither URS nor any of the URS
Subsidiaries has (a) elected to be treated as a "real estate investment trust"
for federal income tax purposes for any taxable year ending after December 31,
1993 or (b) acquired, since January 1, 1994, a substantial portion of the assets
of an entity whose election to be treated as a "real estate investment trust"
has been terminated or revoked. Schedule 4.21 hereto contains a list of states,
territories and jurisdictions (whether foreign or domestic) with respect to
which any income Tax Return has been filed by URS or any URS Subsidiary within
the last three taxable years.
For purposes of this Agreement: (a) "Tax" means any net income,
alternative or add-on minimum tax, gross income, gross receipts, sales, use, ad
valorem, value added, transfer, franchise, profits, license, withholding on
amounts paid to or by URS or any URS Subsidiary, payroll, employment, excise,
severance, stamp, occupation, premium, property, environmental or windfall
profits tax, custom duty or other tax, governmental fee or other like assessment
or charge of any kind whatsoever, together with any interest or penalty,
addition to tax or additional amount imposed by any Governmental Authority
(domestic or foreign) (a "Taxing Authority"), (b) "Taxes" shall have a
correlative meaning and (c) "Tax Returns" shall mean reports, returns,
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information statements relating to Taxes or other documents filed or maintained
or required to be filed or maintained, in connection with any Tax.
4.22 Environmental Matters. Except as set forth on Schedule 4.22
hereto and in the environmental reports, studies, assessments, sampling results
or other written environmental analyses listed therein (the "Environmental
Reports"), URS's and each URS Subsidiary's operation and use of its assets and
the Real Property are in compliance in all respects with all Environmental Laws,
except to the extent that any such noncompliance would not individually or in
the aggregate have a Material Adverse Effect. Except as set forth on Schedule
4.22 or in the Environmental Reports listed thereon, URS and the URS
Subsidiaries have obtained all environmental, health and safety permits
necessary for the operation of the business of URS and the URS Subsidiaries as
presently conducted, and all such permits are in full force and effect and URS
and each URS Subsidiary are in compliance in all respects with the terms and
conditions of each such permit, except, in each case, to the extent that any
such failure to obtain or noncompliance would not individually or in the
aggregate have a Material Adverse Effect.
Except as disclosed in Schedule 4.22 or in the Environmental Reports
and except as could not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect, (i) no property currently owned or
operated by URS or any URS Subsidiary, including the Owned and Leased
Properties, has been contaminated in any material respect with any substance
regulated under any Environmental Law such that any removal or remedial action
is required under Applicable Law; (ii) URS and the URS Subsidiaries are not
subject to any material liability for any off-site disposal or contamination;
and (iii) there are no other conditions or violations involving URS or any URS
Subsidiary (including the presence of asbestos, underground storage tanks,
chlorofluorocarbons, Freon and polychlorinated biphenyls) that are likely to
result in any material claims,
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liabilities or costs or any restrictions on the ownership, use or transfer of
any Owned or Leased Property in connection with any Environmental Law. Except as
disclosed in Schedule 4.22, URS is not in possession of any environmental
reports, studies, assessments, sampling results or other written environmental
analyses relating to any Owned Property other than the Environmental Reports and
a copy of each of these Environmental Reports has been made available to Parent
at least five days prior to the date hereof.
4.23 Brokers, Finders, etc. Except as described on Schedule 4.23,
neither URS nor any URS Subsidiary has employed, or is subject to the valid
claim of, any broker, finder or other financial intermediary in connection with
the transactions contemplated by this Agreement or the transactions contemplated
hereby, who might be entitled to a fee or commission in connection herewith or
therewith.
ARTICLE V
REPRESENTATIONS AND WARRANTIES
OF VORNADO, THE PARENT AND ACQUISITION CO.
Vornado, the Parent and Acquisition Co., jointly and severally,
represent and warrant to URS as follows:
5.1 Organization and Standing. Vornado is a real estate investment
trust duly organized and in good standing under the laws of the State of
Maryland and has the power and authority to carry on its business as presently
conducted, except where the failure to be so qualified would not have a material
adverse effect on its ability to timely perform its obligations hereunder or
consummate the transactions contemplated hereby. The Parent is a Delaware
corporation duly organized and in good standing under the laws of the State of
Delaware and has the power and authority to carry on its business as presently
conducted, except where the failure to be so qualified would not have a
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material adverse effect on its ability to timely perform its obligations
hereunder or consummate the transactions contemplated hereby. Acquisition Co.
is a corporation, duly organized, validly existing and in good standing under
the laws of the State of Delaware and has all requisite corporate power and
authority to carry on its business as presently conducted, except where the
failure to be so qualified would not have a material adverse effect on its
ability to timely perform its obligations hereunder or consummate the
transactions contemplated hereby.
5.2 Authorization and Binding Obligation. Each of Vornado, the
Parent and Acquisition Co. has all necessary corporate or other power and
authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
by Vornado, the Parent and Acquisition Co. and the consummation by Vornado, the
Parent and Acquisition Co. of the transactions contemplated hereby have been
duly and validly authorized and approved by all necessary corporate (or other)
action on the part of each of Vornado, the Parent and Acquisition Co. and no
other corporate action or other proceedings on the part of Vornado, the Parent
or Acquisition Co. is necessary to authorize this Agreement or the consummation
of the transactions contemplated hereby. This Agreement has been duly executed
and delivered by each of Vornado, the Parent and Acquisition Co. and constitutes
a valid and binding obligation of Vornado, the Parent and Acquisition Co.,
enforceable against Vornado, the Parent and Acquisition Co. in accordance with
its terms, except as may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or similar rights of creditors generally and by
general principles of equity.
5.3 Consents and Approvals; No Conflicts. Except for applicable
requirements of the HSRA and filing and recordation of the Certificate of Merger
as required by the GCL, no filing with, and no permit, authorization, consent or
approval of, any public body or authority is necessary for the consummation by
Vornado, the Parent or Acquisition
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Co. of the transactions contemplated by this Agreement, except where the failure
to make such filing or obtain such permit, authorization, consent or approval,
would not have a material adverse effect on such Person's ability to timely
perform its obligations hereunder or consummate the transactions contemplated
hereby. Neither the execution and delivery of this Agreement nor the
consummation of the transactions contemplated hereby, nor compliance by Vornado,
the Parent or Acquisition Co. with any of the provisions hereof will (a) result
in any violation of any provision of the organizational documents of Vornado,
the Parent or Acquisition Co., (b) violate any Applicable Law, or (c) result in
a material violation or breach of, or constitute (with or without due notice or
lapse of time or both) a material default (or give rise to any right of
termination, cancellation or acceleration) under, any material contract,
agreement, note, bond, mortgage, indenture, license, lease, franchise, permit,
Plan or other instrument or obligation to which Vornado, the Parent or
Acquisition Co. is a party, or by which either of them or any of their
respective properties is bound, except in the case of clauses (b) and (c) above,
where such violation, breach, default or right of termination would not have a
material adverse effect on such Person's ability to timely perform its
obligations hereunder or to consummate the transactions contemplated hereby.
5.4 Litigation. There is no claim, litigation, proceeding or
investigation pending or, to the best of Vornado's, the Parent's or Acquisition
Co.'s knowledge, threatened, which seeks to enjoin or prohibit, or otherwise
questions the validity of, any action taken or to be taken by Vornado, the
Parent or Acquisition Co. in connection with this Agreement or which would have
a material adverse effect on such Person's ability to timely perform its
respective obligations hereunder or to consummate the transactions contemplated
hereby.
5.5 Finders and Investment Bankers. None of Vornado, the Parent or
Acquisition Co. has employed, or is subject to the valid claim of, any broker,
finder or other
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financial intermediary in connection with the transactions contemplated by this
Agreement or the transactions contemplated hereby, who might be entitled to a
fee or commission in connection herewith or therewith, payable by URS or any URS
Subsidiary.
5.6 Financing. Vornado has available to it pursuant to existing
credit facilities sufficient cash on hand to allow it to pay the Merger
Consideration, consummate the transactions contemplated hereby and pay related
fees and expenses.
ARTICLE VI
COVENANTS
6.1 Conduct of Business. During the period from the date hereof to
the Closing Date, URS covenants and agrees that it will and will cause the URS
Subsidiaries to carry on their businesses in the ordinary course of business,
in substantially the same manner as heretofore conducted, and will use its
reasonable commercial efforts to preserve intact its and the URS Subsidiaries'
present business organization, keep available the services of their respective
officers and Employees and preserve their relationships with customers and
suppliers and others having business dealings with them, to the end that their
goodwill and going business shall be maintained following the Closing. Without
limiting the generality of the foregoing, except as expressly permitted by this
Agreement or with the prior written consent of the Parent, such consent not to
be unreasonably withheld or delayed, or as set forth on Schedule 6.1 hereto, URS
covenants and agrees that it will not, and it will not permit any URS Subsidiary
to do, or agree to do, on or after the date hereof, any of the following, on or
before the Closing:
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(a) amend their respective certificates of incorporation or by-laws
or other organizational documents;
(b) rescind, modify, amend or otherwise change or affect any of the
resolutions of the Board recommending adoption of this Agreement and
authorization of the Merger;
(c) issue, sell, transfer, assign, pledge, convey or dispose of any
security or equity interest or any security convertible into or
exchangeable or exercisable for any security or equity interest,
including, without limitation, any subscriptions, options, warrants,
calls, conversions or other rights, agreements, commitments, arrangements
or understandings of any kind obligating URS or any URS Subsidiary,
contingently or otherwise, to issue or sell, or cause to be issued or
sold, any security or equity interest of URS or any URS Subsidiary or any
security convertible into or exchangeable or exercisable for any security
or equity interest;
(d) split, combine or reclassify any shares of any class of its
capital stock, declare, set aside or pay any dividend or other
distribution (whether in cash, stock or property or any combination
thereof) in respect of any class of its capital stock, or redeem or
otherwise acquire any shares of such capital stock;
(e) write off any receivables, except in the ordinary course of
business consistent with past practice;
(f) sell, assign, lease or otherwise transfer or dispose of any
material assets except in the ordinary course of business consistent with
past practice in an aggregate amount not in excess of $250,000, unless the
same shall be replaced with assets of equal or greater value and utility;
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(g) (i) except in the ordinary course of business consistent with
past practice under existing lines of credit, create, incur or assume any
liability, including obligations in respect of capital leases, or make or
commit to make capital expenditures in excess of $100,000 each or $250,000
in the aggregate, or create, incur, assume, maintain or permit to exist
any indebtedness in an aggregate amount greater than $250,000 for URS and
the URS Subsidiaries combined; (ii) assume, guarantee, endorse or
otherwise become liable or responsible (whether directly, contingently or
otherwise) for the obligations of any other Person, except for
assumptions, guarantees or endorsements by URS of the obligations of any
URS Subsidiary in the ordinary course of business consistent with past
practice; (iii) except as set forth on Schedule 6.1 hereto, make any
loans, advances or capital contributions to, or investments in, any other
Person (other than customary loans or advances in the ordinary course of
business consistent with past practice to Employees not to exceed $100,000
in the aggregate and extensions of credit made to customers on a trade
receivable basis in the ordinary course of business consistent with past
practice; or (iv) create, assume or permit to exist any Lien upon their
assets, except for those in existence on the date of this Agreement and
except for those additional Liens created in the ordinary course of
business consistent with past practice;
(h) except as set forth on Schedule 6.1(h) hereto (i) increase or
modify or agree to increase or modify the compensation, bonuses or other
benefits or perquisites of any Employee of URS or any URS Subsidiary,
except for salary increases granted in the ordinary course of business
consistent with past practice, or (ii) pay or commit to pay any
compensation, bonus, pension or other retirement benefit or allowance,
fringe benefit or other benefit not required by the terms of an existing
Plan, or collective bargaining agreement as in effect on the date hereof
or
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otherwise in the ordinary course of business consistent with past
practice;
(i) make any new elections, or make any changes to current
elections, with respect to Taxes;
(j) change their auditors, fail to maintain their books and records
in accordance with GAAP or materially change their auditing or bookkeeping
practices;
(k) take or fail to take any action that would cause any of its
representations and warranties not to be true and correct on the Closing
Date in the manner required by Section 7.3(b) hereof;
(l) cancel or materially amend or modify any agreements or any real
or material personal property leases;
(m) other than in the ordinary course of business, cancel or
materially amend or modify any agreements with customers; or
(n) enter into any new agreements with any customers with a duration
of more than one year.
6.2 Third-Party Consents. URS covenants and agrees that it will and
will cause each URS Subsidiary to use reasonable commercial efforts to obtain,
prior to Closing, the consents of third parties and Governmental Authorities set
forth on Schedule 4.4 hereto.
6.3 Compliance with GCL; Filings. (a) As soon as practicable and in
any event within ten (10) days after the date of this Agreement, URS will
prepare and deliver to each stockholder of URS a notice, in accordance with
Sections 228(d) and 262(d)(2) of the GCL, regarding (i) the execution of this
Agreement, (ii) the Board's approval of this Agreement, (iii) the execution by
each URS Stockholder of an action by written consent in lieu of a meeting of
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stockholders adopting the Merger and (iv) the availability of appraisal rights
under Section 262 of the GCL.
(b) As promptly as practicable, each of URS, the Parent and
Acquisition Co. shall properly prepare and file any filings required under any
Federal, state, county, local or municipal law relating to the Merger and the
transactions contemplated herein (such filings, together with the filings
required under the HSRA, are, collectively, the "Filings"). The Parent and
Acquisition Co., on the one hand, and URS, on the other, shall promptly notify
the other of the receipt of any comments on, or any request for amendments or
supplements to, the Filings by any governmental official, and each of URS, the
Parent and Acquisition Co. will supply the other with copies of all
correspondence between it and each of its subsidiaries and representatives, on
the one hand, and any appropriate governmental official, on the other hand, with
respect to the Filings.
6.4 Additional Agreements. Subject to the terms and conditions
herein provided, each of the parties hereto agrees to use (and URS shall cause
the URS Subsidiaries to use) their 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 to consummate and make effective as promptly as
practicable the transactions contemplated by this Agreement and to cooperate
with one another in connection with the foregoing, including using its
commercially reasonable efforts to obtain all necessary consents, approvals and
authorizations as are required to be obtained under Applicable Law, to defend
all lawsuits or other legal proceedings challenging this Agreement or the
consummation of the transactions contemplated hereby, to cause to be lifted or
rescinded any injunction or restraining order or other order adversely
affecting the ability of the parties to consummate the transactions contemplated
hereby, and to effect all necessary registrations and Filings.
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6.5 Acquisition Proposals. None of URS or any of URS's employees,
representatives or agents (collectively, the "URS Representatives") shall,
directly or indirectly, solicit or initiate inquiries or proposals from or enter
into any agreement with respect to, or provide any confidential information to
or participate in any discussions or negotiations with, any Persons or group
(other than the Parent, Acquisition Co. and their respective subsidiaries and
their respective directors, officers, employees, representatives and agents)
concerning any sale of assets or shares of URS Common Stock, any assets or
shares of capital stock of any URS Subsidiary or any merger, consolidation or
similar transaction involving URS or any URS Subsidiary (except, in all cases,
for any sale of immaterial assets, in the ordinary course of business consistent
with past practices). URS will promptly cease and URS will cause to be
terminated by the URS Subsidiaries any existing discussions or negotiations
with any third parties conducted heretofore with respect to any of the foregoing
and will use its reasonable commercial efforts to retrieve and/or cause to be
destroyed any and all nonpublic information concerning URS or any URS Subsidiary
that has been furnished to third parties in connection therewith.
6.6 Public Announcements. The Parent and URS will consult with one
another before issuing any press release or otherwise making any public
statement with respect to this Agreement or the Merger and shall not issue any
such press release or make any such public statement prior to such consultation
without the consent of the Parent and URS, except based on the advice of counsel
for URS or the Parent, as the case may be, as required by Applicable Law.
6.7 Consent of the Parent. The Parent, as the sole shareholder of
Acquisition Co., by executing this Agreement hereby consents to the execution,
delivery and performance of this Agreement by Acquisition Co. and such consent
shall be treated for all purposes as a vote duly
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adopted at a meeting of the shareholders of Acquisition Co. held for such
purpose.
6.8 Transfer Taxes. (a) The Parent shall be responsible for the
payment of, and shall indemnify the URS Stockholders against, all Transfer Taxes
arising out of or in connection with or attributable to the transactions
effected pursuant to this Agreement.
(b) As between the URS Stockholders, on the one hand, and the
Parent, on the other hand, the party that has the primary responsibility under
Applicable Law for filing any Tax return required to be filed in respect of
Transfer Taxes shall prepare and timely file such Tax return, provided that such
party's preparation of such Tax return shall be subject to the other party's
approval, which approval shall not be withheld or delayed unreasonably.
6.9 Treatment of Books and Records. For a period of three years
after the Closing Date, at least 30 days prior to discarding or destroying any
books or records relating to the business of URS, the Parent shall give Kelso,
as a representative of the URS Stockholders, notice of its intended action and
an opportunity for Kelso to retain any of the books or records proposed to be
discarded or destroyed by the Parent or URS, as the case may be. Prior to the
destruction of any such books or records, Kelso shall have the right, upon
reasonable advance request, to have access to such books and records during
normal business hours to enable any or all of the URS Stockholders to fulfill
their Tax or other ordinary course of business obligations.
6.10 Indemnification of Officers and Directors. The Parent agrees
that for the entire period from the Effective Time until at least six (6) years
after the Effective Time the Certificate of Incorporation and the By-Laws of the
Surviving Corporation shall contain the provisions with respect to
indemnification and exculpation from liability set forth in URS's Certificate
of
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Incorporation and By-Laws as of the date of this Agreement, which provisions
shall not be amended, repealed or otherwise modified during such period in any
manner that would adversely affect the rights thereunder of individuals who on
or prior to the Effective Time were directors, officers, employees or agents of
URS unless such modification is required by Applicable Law.
6.11 Access. Upon reasonable notice, and except as may otherwise be
required by Applicable Law, URS shall (and shall cause the URS Subsidiaries to)
afford the Parent's officers, agents and advisors reasonable access, during
normal business hours throughout the period prior to the Effective Time, to its
properties, books, contracts and records and, during such period, URS shall (and
shall cause the URS Subsidiaries to) furnish to the Parent and its agents and
advisors all information concerning its business, properties and personnel as
they may reasonably request, provided that no investigation pursuant to this
Section shall affect or be deemed to modify any representation or warranty made
by URS. All such information shall be governed by the terms of the
Confidentiality Agreement referred to in Section 11.4.
6.12 Repayment of Indebtedness. If requested by the Parent prior to
the Closing, the Company will repay all indebtedness under each of the MetLife
Loan Agreement and the BT Credit Agreement (using funds supplied by the Parent).
6.13 Post-Closing True-Up. In the event that at any time subsequent
to the Closing, URS repays the indebtedness under the MetLife Loan Agreement
and the aggregate amount of indebtedness repaid, together with any interest due
thereon and the prepayment, redemption or prepayment fees, surcharges, premiums
or penalties associated with such repayment are less than the Prepayment Price
(as defined in Section 1.1 of the MetLife Loan Agreement) that would be payable
at such time were such indebtedness repaid at such time pursuant to the terms of
the MetLife Loan Agreement, as
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in effect on the date hereof (the amount of such difference being referred to
herein as the "Prepayment Shortfall"), then Vornado shall promptly pay to Kelso,
as a representative of the former holders of URS Common Stock an amount equal to
one-half of the Prepayment Shortfall and such payment shall be distributed to
the former holders of URS Common Stock and Warrants with an Exercise Price in
excess of the Per Share Price ratably in proportion to their respective holdings
(calculated on a fully diluted basis).
6.14 Management Bonus Amount Arrangements. Prior to the Closing,
Parent and URS shall make arrangements, reasonably satisfactory to URS, for the
payment of the portion of the Management Bonus Amount set forth on Schedule
1.34(b) to each of the applicable individuals and in the applicable amounts
specified by URS in writing prior to the Effective Time; it being understood and
agreed that URS shall consult with Vornado regarding the selection of such
individuals and such amounts. Such arrangements shall include an escrow and
shall provide, among other things, that all such payments shall be made to each
individual by no later than 90 days after the Effective Time so long as such
individual has not voluntarily terminated his employment with URS prior to such
90th day after the Effective Time.
ARTICLE VII
CLOSING CONDITIONS
7.1 Conditions Precedent to the Obligations of All Parties. The
respective obligations of each party to effect the Merger shall be subject to
the fulfillment at or prior to the Effective Time of each of the following
conditions:
(a) Any waiting period (and any extension thereof) applicable to
the consummation of the Merger under the HSRA shall have expired or been
terminated.
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(b) No preliminary or permanent injunction or other order, decree or
ruling issued by a court of competent jurisdiction or by a governmental,
regulatory or administrative agency or commission nor any statute, rule,
regulation or executive order promulgated or enacted by any Governmental
Authority shall be in effect which would be reasonably likely to (i) make
the consummation of the Merger by Vornado, the Parent, Acquisition Co. or
URS illegal or (ii) otherwise prevent the consummation of the Merger.
7.2 Additional Conditions to the Obligation of URS. The obligation
of URS to effect the Merger is also subject to the fulfillment at or prior to
the Effective Time of the following additional conditions:
(a) The Parent and Acquisition Co. shall each have performed in all
material respects each of its respective obligations under this Agreement
required to be performed by it on or prior to the Effective Time pursuant
to the terms hereof.
(b) The representations and warranties of the Parent and Acquisition
Co. contained in this Agreement shall be true and correct in all material
respects, in each case when made and, unless such representation or
warranty is made as of a specific date (in which case it shall be true and
correct in all material respects as of such date), at and as of the
Effective Time as if made at and as of such time.
(c) URS shall have received a certificate, dated the Closing Date,
of the President or any Vice President of the Parent to the effect that
the conditions specified in paragraphs (a) and (b) of this Section 7.2
have been fulfilled.
(d) Each of Parent and Acquisition Co. shall have reaffirmed all of
URS's obligations under each of the Employment Agreements listed on
Schedule 4.16 hereto.
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(e) URS shall have paid, or cause to be paid, (i) the portion of the
Management Bonus Amount set forth on Schedule 1.34(a) hereto to the
individuals and in the amounts designated by URS in writing prior to the
Effective Time and (ii) a fee of $3,000,000 to Kelso in respect of Kelso's
services in connection with the consummation of the transactions provided
for hereby.
(f) URS shall have received the opinion of Sullivan & Cromwell,
special counsel to Vornado, the Parent and Acquisition Co., in form and
substance reasonably satisfactory to URS, as to the due authorization,
execution and delivery of this Agreement by such parties.
7.3 Conditions Precedent to Obligations of the Parent and
Acquisition Co. The obligations of the Parent and Acquisition Co. to effect the
Merger are also subject to the fulfillment at or prior to the Effective Time of
the following additional conditions:
(a) URS shall have performed in all material respects each of its
obligations under this Agreement required to be performed by it on or
prior to the Effective Time pursuant to the terms hereof.
(b) The representations and warranties of URS set forth in this
Agreement that are qualified by reference to a Material Adverse Effect
shall be true and correct, and all other representations and warranties of
URS shall be true and correct, except for failures to be true and correct
as would not, individually or in the aggregate, have a Material Adverse
Effect, as of the date of this Agreement and as of the Effective Time as
though made as of the Effective Time (except to the extent any such
representation or warranty expressly speaks as of an earlier date, in
which case it shall have been true and correct in all material respects as
of such date).
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(c) The Parent shall have received a certificate, dated the Closing
Date, of the Chief Executive Officer of URS, to the effect that the
conditions specified in paragraphs (a) and (b) of this Section 7.3 have
been fulfilled.
(d) The Consulting Agreement, dated as of November 30, 1994,
between URS and Rutledge & Company, Inc., the Consulting Agreement, dated
as of April 6, 1993 between URS and Vero Industries, and the Consulting
Agreement, dated as of April 6, 1993, between the Company and Kelso &
Company, shall each have been terminated without further obligation to URS
or any URS Subsidiary.
(e) The Waiver Letter, attached hereto as Exhibit 7.3(e) and
pursuant to which each of Mr. Hanns Pielenz, UniFridge Holding Corporation
and Refrigerated Warehouse Investments Holding Corporation has waived
their "property put" rights under each of the Lease Agreements, shall
continue to be in full force and effect.
(f) Vornado, the Parent and the Subsidiary shall each have received
the opinion of Debevoise & Plimpton, special counsel to URS, in form and
substance reasonably satisfactory to Vornado, as to the due authorization,
execution and delivery of this Agreement by URS and the absence of any
agreements among the shareholders of URS or with any potential purchasers
of URS that conflict with the execution, delivery and performance of this
Agreement.
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ARTICLE VIII
CLOSING
8.1 Time and Place. Subject to the satisfaction or waiver of all
applicable conditions in Article VII, the closing of the Merger (the "Closing")
shall take place at the offices of Debevoise & Plimpton, 875 Third Avenue, New
York, N.Y. 10022, at 10:00 a.m., local time, on the third business day following
the satisfaction of the condition set forth in Section 7.1(a) or on such other
date as URS and the Parent may agree.
8.2 Filings at the Closing; Other Actions. At the Closing, the
Parent and URS shall cause the Certificate of Merger to be filed and recorded in
accordance with the provisions of Sections 103 and 251 of the GCL, and shall
take any and all other lawful actions and do any and all other lawful things
necessary to cause the Merger to become effective.
ARTICLE IX
NON-SURVIVAL OF REPRESENTATIONS,
WARRANTIES AND COVENANTS
All of the representations and warranties contained in this
Agreement or any representations and warranties contained in any certificate,
document or instrument delivered pursuant to this Agreement shall terminate as
of the Closing. The covenants set forth in Sections 3.4, 3.5, 6.6, 6.8, 6.9,
6.10, 6.13 and 6.14 herein shall survive for the respective periods set forth
therein.
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ARTICLE X
TERMINATION RIGHTS
10.1 Termination. This Agreement may be terminated at any time
prior to the Effective Time:
(a) by mutual consent of the Parent and URS;
(b) by either the Parent or URS if the Merger shall not have been
consummated on or before January 15, 1998; provided, however, that the
right to terminate this Agreement shall not be available to any party
whose failure to fulfill any obligation of this Agreement has been the
cause of, or resulted in, the failure of the Merger to have occurred on or
before the aforesaid date;
(c) by the Parent, if URS shall have materially breached any of its
covenants herein or if URS shall have made a material misrepresentation
and not cured the same within 15 days of notice of such breach or
misrepresentation;
(d) by URS, if either the Parent or Acquisition Co. shall have
materially breached any of its covenants herein or if either the Parent or
Acquisition Co. shall have made a material misrepresentation herein and
not cured the same within 15 days of notice of such breach or
misrepresentation; or
(e) by either the Parent or URS, if any court of competent
jurisdiction or other governmental agency of competent jurisdiction shall
have issued an order, decree or ruling or taken any other action
restraining, enjoining or otherwise prohibiting the Merger, and such
order, decree, ruling or other action shall have become final and
non-appealable.
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10.2 Procedure and Effect of Termination. In the event of
termination and abandonment of the Merger by the Parent or URS pursuant to
Section 10.1 hereof, notice thereof shall forthwith be given to URS or the
Parent, respectively, and this Agreement shall terminate and the Merger shall be
abandoned, without further action by any of the parties hereto. Vornado and
Acquisition Co. each agrees that any termination by the Parent or URS,
respectively, shall be conclusively binding upon it, whether given expressly on
its behalf or not. If this Agreement is terminated as provided herein, no party
hereto shall have any liability or further obligation to any other party to this
Agreement except that any termination shall be without prejudice to the rights
of any party hereto arising out of a breach by any other party of any covenant
or agreement contained in this Agreement, and except that the provisions of
Sections 6.6, 11.4 and 11.5 hereof shall survive such termination.
ARTICLE XI
OTHER PROVISIONS
11.1 Amendment and Modification. Subject to Applicable Law, this
Agreement may be amended, modified or supplemented only by mutual written
agreement of the parties hereto.
11.2 Benefit and Assignment. This Agreement shall be binding upon
and shall inure to the benefit of the parties hereto and their respective heirs,
successors and assigns, but neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by any party to this
Agreement without the prior written consent of the other parties hereto. Any
purported assignment made in contravention of the previous sentence shall be
null and void.
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11.3 No Third-Party Beneficiaries. Nothing in this Agreement shall
confer any rights upon any Person other than the parties hereto and their
respective heirs, successors and permitted assigns, except for the rights set
forth in Sections 3.1, 6.9, 6.10, 6.13 and 6.14 hereof.
11.4 Entire Agreement. This Agreement and the Confidentiality
Agreement, dated as of July 28, 1997, between URS and Vornado and the exhibits
and schedules hereto and thereto embody the entire agreement and understanding
of the parties hereto and supersede any and all prior agreements, arrangements
and understandings relating to the matters provided for herein and therein. No
amendment, waiver of compliance with any provision or condition hereof or
consent pursuant to this Agreement shall be effective unless evidenced by an
instrument in writing signed by the party against whom enforcement of any
amendment, waiver or consent is sought. Acquisition Co. hereby agrees that any
consent or waiver of compliance given by the Parent hereunder shall be
conclusively binding upon it, whether given expressly on its behalf or not. No
party is making any representation or warranty whatsoever, express or implied,
except the representations and warranties contained in this Agreement and each
party acknowledges and agrees that it has not relied on or been induced to enter
into this Agreement by any representation or warranty other than those expressly
set forth herein.
11.5 Expenses. Except as otherwise provided in this Agreement, each
of the Parent and Acquisition Co., on the one hand, and URS, on the other hand,
shall be responsible for the payment of their respective expenses, including
legal and accounting fees, in connection with the preparation, negotiation and
closing of this Agreement and the transactions contemplated hereby.
11.6 Headings. The headings set forth in this Agreement are for
convenience only and will not control or affect the meaning or construction of
the provisions of this Agreement.
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11.7 Choice of Law. The construction and performance of this
Agreement shall be governed by the laws of the State of New York without regard
to its principles of conflict of laws, except insofar as the laws of the state
of Delaware are mandatorily applicable to the Merger, and the state and federal
courts of New York shall have exclusive jurisdiction over any controversy or
claim arising out of or relating to this Agreement.
11.8 Notices. All notices, requests, demands, letters, waivers and
other communications required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been duly given if (a) delivered
personally, (b) mailed, certified or registered mail with postage prepaid, (c)
sent by next-day or overnight mail or delivery or (d) sent by fax, as follows:
(a) If to Vornado, the Parent or Acquisition Co., to it at:
Vornado Realty Trust
Park 80 West, Plaza II
Saddle Brook, NJ 07663
Telecopy #: (201) 291-1093
Attention: Mr. Michael D. Fascitelli
with copies to:
Sullivan & Cromwell
1701 Pennsylvania Avenue, N.W.
Washington, D.C. 20006
Telecopy #: (202) 293-6330
Attention: Janet T. Geldzahler, Esq.
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(b) If to URS, to it at:
URS Logistics, Inc.
One Concourse Parkway
Suite 450
Atlanta, Georgia 30328
Telecopy #: (770) 280-3985
Attention: Mr. Fred Beilstein
with copies to:
Kelso & Company
320 Park Avenue
24th Floor
New York, NY 10022
Telecopy #: (212) 223-2379
Attention: James J. Connors, II, Esq.
and:
Arnall Golden & Gregory, LLP
2800 One Atlantic Center
1201 West Peachtree Street
Atlanta, Georgia 30355
Telecopy #: (404) 873-8701
Attention: Jonathan Golden, Esq.
or to such other Person or address as any party shall specify by notice in
writing to the party entitled to notice. All such notices, requests, demands,
letters, waivers and other communications shall be deemed to have been received
(w) if by personal delivery on the day after such delivery, (x) if by certified
or registered mail, on the fifth Business Day after the mailing thereof, (y) if
by next-day or overnight mail or delivery, on the day delivered or (z) if by
fax, on the next day following the day on which
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such fax was sent, provided that a copy is also sent by certified or registered
mail.
11.9 Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original and all of which together
will constitute one and the same instrument.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed as of the date first written above.
VORNADO REALTY TRUST
By: /s/ Michael D. Fascitelli
________________________
Name:
Title:
ATLANTA PARENT, INC.
By: /s/ Michael D. Fascitelli
________________________
Name:
Title:
ATLANTA STORAGE ACQUISITION CO.
By: /s/ Michael D. Fascitelli
__________________________
Name:
Title:
URS LOGISTICS, INC.
By: /s/ Daniel F. McNamara
__________________________
Name: Daniel F. McNamara
Title: President and
Chief Executive Officer
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