SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
Pursuant
to Section 13 or 15(d)
of the Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 12, 2015
BORGWARNER INC.
(Exact
name of registrant as specified in its charter)
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| Delaware |
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1-12162 |
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13-3404508 |
| (State or other jurisdiction
of incorporation) |
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(Commission
File No.) |
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(IRS Employer
Identification No.) |
3850 Hamlin Road, Auburn Hills, Michigan 48326
(Address of principal executive offices) (Zip Code)
Registrant’s telephone number, including area code: (248) 754-9200
(Former name or former address, if changed since last report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
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Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
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Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
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Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
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Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
| Item 1.01 |
Entry Into a Material Definitive Agreement. |
On July 12, 2015, BorgWarner Inc., a
Delaware corporation (“BorgWarner”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Remy International, Inc., a Delaware corporation (“Remy”), and BorgWarner’s
wholly-owned subsidiary, Band Merger Sub, Inc., a Delaware corporation (“Merger Sub”), providing for the merger of Merger Sub with and into Remy (the “Merger”), with Remy surviving the Merger as a wholly-owned subsidiary
of BorgWarner. Pursuant to the Merger Agreement, at the effective time of the Merger, each share of common stock, par value $0.0001 per share of Remy issued and outstanding immediately prior to the effective time of the Merger (each, a
“Share”) (other than (i) Shares owned by BorgWarner, Merger Sub or Remy, or by any subsidiary of BorgWarner, Merger Sub or Remy, in each case except to the extent held by any such person on behalf of a third party and
(ii) shares that are owned by stockholders who have perfected and not withdrawn a demand for appraisal rights pursuant to Delaware law) will be cancelled and converted into the right to receive cash in an amount, without interest, equal to
$29.50.
Consummation of the Merger is subject to the satisfaction or waiver of specified closing conditions, including (i) the
approval of the Merger by the holders of a majority of the outstanding Shares, (ii) the expiration or termination of the applicable waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, (iii) the making or
obtaining of any filings, authorizations, consents or approvals regarding the Merger required pursuant to Antitrust Laws (as defined in the Merger Agreement) in Austria, Germany, China, Korea and Mexico and the termination or expiration of any
applicable waiting period thereunder and (iv) other customary closing conditions, including (a) the accuracy of each party’s representations and warranties (subject to customary materiality qualifiers), (b) each party’s
compliance with its agreements and covenants contained in the Merger Agreement and (c) the absence of any law, ordinance, rule, regulation, order, judgment or decree being in effect that restrains or enjoins, or otherwise prohibits or makes
illegal, the consummation of the Merger. The Merger Agreement also includes customary representations, warranties and covenants of Remy, BorgWarner, and Merger Sub.
The Merger Agreement also includes specified termination rights for both Remy and BorgWarner. In certain circumstances, Remy must pay to
BorgWarner a termination fee in connection with the termination of the Merger Agreement.
The foregoing summary of the principal terms of
the Merger Agreement does not purport to be complete and is qualified in its entirety by reference to the full copy of the Merger Agreement filed as Exhibit 2.1 hereto and incorporated herein by reference. The summary and the copy of the Merger
Agreement are intended to provide information regarding the terms of the Merger Agreement and are not intended to modify or supplement any factual disclosures about Remy or BorgWarner in its public reports filed with the SEC. In particular, the
Merger Agreement and related summary are not intended to be, and should not be relied upon as, disclosures regarding any facts and circumstances relating to any party to the Merger Agreement. The Merger Agreement includes representations, warranties
and covenants of Remy, BorgWarner and Merger Sub made solely for the benefit of the parties to the Merger Agreement. The assertions embodied in those representations and warranties were made solely for purposes of the contract among Remy, BorgWarner
and Merger Sub and may be subject to important qualifications and limitations agreed to by Remy, BorgWarner and Merger Sub in connection with the negotiated terms. Moreover, some of those representations and warranties may not be accurate or
complete as of any specified date, may be subject to a contractual standard of materiality different from those generally applicable to Remy’s or BorgWarner’s SEC filings or may have been used for purposes of allocating risk among Remy,
BorgWarner and Merger Sub rather than establishing matters as facts. Investors should not rely on the representations, warranties and covenants or any description thereof as characterizations of the actual state of facts of Remy, BorgWarner, Merger
Sub or any of their respective subsidiaries or affiliates.
| Item 7.01 |
Regulation FD Disclosure. |
On July 13, 2015, BorgWarner issued a press release
announcing the execution of the Merger Agreement. A copy of the press release is furnished herewith as Exhibit 99.1 and is incorporated herein by reference.
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On July 12, 2015, concurrently with the execution of the
Merger Agreement, BorgWarner and H Partners Management, LLC, H Partners, LP, H Partners Capital, LLC, P H Partners Ltd., H Offshore Fund Ltd. and Rehan Jaffer (collectively, “H Partners”) and the Company entered into a voting and
support agreement (“Voting and Support Agreement”), pursuant to which, among other things and subject to the terms and conditions therein, H Partners agreed to vote all Shares beneficially owned by H Partners, representing
approximately 8.7% of the outstanding Shares of the Company, in favor of the adoption of the Merger Agreement and the approval of the transactions contemplated by the Merger Agreement, including the Merger, and any other matter to be approved by the
stockholders of the Company to facilitate such transactions, and not to vote in favor of any alternative transactions. H Partners has also agreed to be subject to the same restrictions on the solicitation or initiation of other acquisition proposals
and on engaging in discussions regarding such proposals as are applicable to the Company’s representatives pursuant to the Merger Agreement.
| Item 9.01 |
Financial Statements and Exhibits |
(d) Exhibits:
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2.1 |
Agreement and Plan of Merger, dated as of July 12, 2015, by and among BorgWarner Inc., Band Merger Sub, Inc. and Remy International, Inc.* |
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99.1 |
Press Release of BorgWarner Inc. issued July 13, 2015 |
| * |
The registrant agrees to furnish supplementally to the SEC a copy of any omitted schedule or exhibit upon the request of the SEC in accordance with Item 601(b)(2) of Regulation S-K. |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
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BORGWARNER INC. |
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| Date: July 14, 2015 |
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By: |
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/s/ John J. Gasparovic |
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Name: |
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John J. Gasparovic |
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Title: |
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Secretary |
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EXHIBIT INDEX
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| Exhibit
Number |
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Description |
| 2.1 |
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Agreement and Plan of Merger, dated as of July 12, 2015, by and among BorgWarner Inc., Band Merger Sub, Inc. and Remy International, Inc. |
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| 99.1 |
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Press Release of BorgWarner Inc. issued July 13, 2015 |
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Exhibit 2.1
AGREEMENT AND PLAN OF MERGER
by and among
BORGWARNER INC.,
BAND
MERGER SUB, INC.
and
REMY INTERNATIONAL, INC.
Dated as of July 12, 2015
TABLE OF CONTENTS
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Page |
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| PREAMBLE |
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1 |
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| RECITALS |
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1 |
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| ARTICLE I |
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| THE MERGER |
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| Section 1.1 |
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The Merger |
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2 |
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| Section 1.2 |
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Effective Time |
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2 |
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| Section 1.3 |
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Closing |
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2 |
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| Section 1.4 |
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Directors and Officers of the Surviving Corporation |
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3 |
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| ARTICLE II |
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| MERGER CONSIDERATION; CONVERSION OF STOCK |
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| Section 2.1 |
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Conversion of Company Stock |
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3 |
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| Section 2.2 |
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Disposition of Certificates and Book-Entry Shares |
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6 |
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| ARTICLE III |
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| REPRESENTATIONS AND WARRANTIES OF THE COMPANY |
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| Section 3.1 |
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Organization, Standing and Power |
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9 |
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| Section 3.2 |
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Capital Stock |
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10 |
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| Section 3.3 |
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Authority |
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12 |
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| Section 3.4 |
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No Conflict; Consents and Approvals |
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12 |
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| Section 3.5 |
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SEC Reports; Financial Statements |
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13 |
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| Section 3.6 |
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No Undisclosed Liabilities |
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15 |
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| Section 3.7 |
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Proxy Statement; Company Information |
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15 |
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| Section 3.8 |
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Absence of Certain Changes or Events |
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16 |
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| Section 3.9 |
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Litigation |
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16 |
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| Section 3.10 |
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Compliance with Laws |
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16 |
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| Section 3.11 |
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Benefit Plans |
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18 |
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| Section 3.12 |
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Labor Matters |
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21 |
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| Section 3.13 |
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Environmental Matters |
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22 |
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| Section 3.14 |
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Taxes |
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23 |
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| Section 3.15 |
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Contracts |
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25 |
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| Section 3.16 |
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Insurance |
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28 |
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| Section 3.17 |
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Properties |
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28 |
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| Section 3.18 |
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Intellectual Property |
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29 |
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| Section 3.19 |
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Customers and Suppliers |
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30 |
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| Section 3.20 |
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Affiliate Transactions |
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31 |
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| Section 3.21 |
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Hedging |
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31 |
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TABLE OF CONTENTS
(Continued)
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| Section 3.22 |
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Quality and Safety of Products |
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31 |
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| Section 3.23 |
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Tax Matters Agreement |
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31 |
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| Section 3.24 |
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Brokers |
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32 |
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| Section 3.25 |
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Takeover Statutes |
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32 |
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| Section 3.26 |
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Fairness Opinion |
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32 |
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| ARTICLE IV |
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| REPRESENTATIONS AND WARRANTIES OF |
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| PARENT AND MERGER SUB |
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| Section 4.1 |
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Organization, Standing and Power |
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| Section 4.2 |
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Authority |
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| Section 4.3 |
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No Conflict; Consents and Approvals |
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| Section 4.4 |
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Information in the Proxy Statement |
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34 |
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| Section 4.5 |
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Ownership and Operations of Merger Sub |
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34 |
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| Section 4.6 |
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Litigation |
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34 |
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| Section 4.7 |
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Financing |
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34 |
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| Section 4.8 |
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Vote/Approval Required |
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34 |
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| Section 4.9 |
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Brokers |
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35 |
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| Section 4.10 |
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Ownership of Shares |
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| Section 4.11 |
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Acknowledgment of No Other Representations or Warranties |
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35 |
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| ARTICLE V |
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| COVENANTS |
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| Section 5.1 |
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Conduct of Business of the Company |
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| Section 5.2 |
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Obligations of Merger Sub and Surviving Corporation |
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| Section 5.3 |
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Acquisition Proposals |
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| Section 5.4 |
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Preparation of the Proxy Statement; Stockholders Meeting |
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46 |
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| Section 5.5 |
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Access to Information; Confidentiality |
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48 |
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| Section 5.6 |
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Further Action; Efforts |
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| Section 5.7 |
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Employee Benefits Matters |
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52 |
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| Section 5.8 |
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Notification of Certain Matters |
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54 |
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| Section 5.9 |
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Indemnification, Exculpation and Insurance |
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| Section 5.10 |
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Rule 16b-3 |
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56 |
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| Section 5.11 |
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Anti-Takeover Statute |
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| Section 5.12 |
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Stockholder Litigation |
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| Section 5.13 |
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Public Announcements |
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| Section 5.14 |
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Transfer Taxes |
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57 |
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| Section 5.15 |
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Stock Exchange Delisting |
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57 |
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ii
TABLE OF CONTENTS
(Continued)
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| ARTICLE VI |
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| CONDITIONS PRECEDENT |
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| Section 6.1 |
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Conditions to Each Party’s Obligations to Effect the Merger |
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| Section 6.2 |
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Conditions to Obligations of Parent and Merger Sub |
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| Section 6.3 |
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Conditions to Obligations of the Company |
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59 |
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| ARTICLE VII |
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| TERMINATION, AMENDMENT AND WAIVER |
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| Section 7.1 |
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Termination |
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| Section 7.2 |
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Effect of Termination |
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61 |
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| Section 7.3 |
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Fees and Expenses |
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61 |
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| Section 7.4 |
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Amendment or Supplement |
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64 |
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| Section 7.5 |
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Extension of Time; Waiver |
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64 |
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| ARTICLE VIII |
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| GENERAL PROVISIONS |
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| Section 8.1 |
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Survival |
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64 |
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| Section 8.2 |
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Notices |
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64 |
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| Section 8.3 |
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Certain Definitions |
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66 |
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| Section 8.4 |
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Interpretation |
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69 |
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| Section 8.5 |
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Entire Agreement |
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69 |
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| Section 8.6 |
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Parties in Interest |
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70 |
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| Section 8.7 |
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Obligations of Parent and of the Company |
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70 |
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| Section 8.8 |
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Governing Law |
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70 |
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| Section 8.9 |
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Submission to Jurisdiction |
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71 |
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| Section 8.10 |
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Assignment; Successors |
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71 |
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| Section 8.11 |
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Enforcement |
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| Section 8.12 |
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Currency |
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| Section 8.13 |
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Severability |
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72 |
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| Section 8.14 |
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Waiver of Jury Trial |
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72 |
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| Section 8.15 |
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Counterparts |
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72 |
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| Section 8.16 |
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Electronic Signature |
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72 |
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| Section 8.17 |
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No Presumption Against Drafting Party |
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72 |
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| Section 8.18 |
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Disclosure Letters |
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72 |
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| Annex I |
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Defined Terms |
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| Exhibit A |
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Form of Certificate of Incorporation of the Surviving Corporation |
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iii
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (this “Agreement”), dated as of July 12, 2015, is by and among BorgWarner Inc., a
Delaware corporation (“Parent”), Band Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of Parent (“Merger Sub”) and Remy International, Inc., a Delaware corporation (the
“Company” and together with Parent and Merger Sub, the “Parties”).
RECITALS
WHEREAS, pursuant to this Agreement, and upon the terms and subject to the conditions set forth herein, Merger Sub will be merged with and
into the Company with the Company as the surviving corporation (the “Merger”), in accordance with the Delaware General Corporation Law (the “DGCL”), and each issued and outstanding share of common stock of the
Company, par value $0.0001 per share (each a “Share”) (other than Excluded Shares and other than Dissenting Shares) will be converted into the right to receive $29.50 per Share in cash (the “Per Share Merger
Consideration”), without interest and subject to any withholding of Taxes required by applicable Law;
WHEREAS, the board of
directors of the Company (the “Company Board”) has unanimously (i) approved and declared advisable this Agreement and the transactions contemplated by this Agreement, including the Merger, upon the terms and subject to the
conditions set forth herein, and (ii) determined that this Agreement and such transactions are fair to, and in the best interests of, the Company and its stockholders (other than Parent and its Subsidiaries);
WHEREAS, the board of directors of Parent has by the unanimous vote of those present at a meeting (i) approved and declared advisable
this Agreement and the transactions contemplated by this Agreement, including the Merger, upon the terms and subject to the conditions set forth herein and (ii) determined that this Agreement and such transactions are fair to, and in the best
interests of, Parent;
WHEREAS, the board of directors of Merger Sub has unanimously (i) approved and declared advisable this
Agreement and the transactions contemplated by this Agreement, including the Merger, upon the terms and subject to the conditions set forth herein and (ii) determined that this Agreement and such transactions are fair to, and in the best
interests of, Merger Sub;
WHEREAS, concurrently with the execution of this Agreement, H Partners Management, LLC, H Partners, LP, H
Partners Capital, LLC, P H Partners Ltd., H Offshore Fund Ltd. and Rehan Jeffer (collectively, “H Partners Group”) are entering into a Voting and Support Agreement with Parent (the “Voting Agreement”); and
WHEREAS, each of Parent, Merger Sub and the Company desires to make certain representations, warranties, covenants and agreements in
connection with the Merger and also to prescribe various conditions to the Merger.
NOW, THEREFORE, in consideration of the representations, warranties, covenants and agreements
contained in this Agreement and for other good and valuable consideration, the receipt and adequacy of which are hereby acknowledged, the Parties agree as follows:
ARTICLE I
THE MERGER
Section 1.1 The Merger.
(a) Upon the terms and subject to the satisfaction or waiver of the conditions set forth in this Agreement, and in accordance with the DGCL, at
the Effective Time, the Company and Merger Sub shall consummate the Merger, and as a result thereof: (i) Merger Sub shall be merged with and into the Company and the separate corporate existence of Merger Sub shall thereupon cease,
(ii) the Company shall be the surviving corporation in the Merger and shall continue to be governed by the DGCL and (iii) the separate corporate existence of the Company with all its rights, privileges, immunities, powers and franchises
shall continue unaffected by the Merger, except as set forth in this Section 1.1 and in Section 1.2. The corporation surviving the Merger is sometimes hereinafter referred to as the “Surviving Corporation.”
As a result of the Merger, the Surviving Corporation will be a wholly-owned direct or indirect Subsidiary of Parent. The Merger shall have the effects set forth in this Agreement and specified in the DGCL.
(b) At the Effective Time, the certificate of incorporation of the Company shall be amended and restated to read as set forth on
Exhibit A hereto and shall thereafter be the certificate of incorporation of the Surviving Corporation until thereafter changed or amended as provided therein or by applicable Law. At the Effective Time, the bylaws of Merger Sub in
effect immediately prior to the Effective Time, which shall comply with Section 5.9(b), shall be the bylaws of the Surviving Corporation until thereafter changed or amended as provided therein or by applicable Law.
Section 1.2 Effective Time. At the Closing, Parent, Merger Sub and the Company shall cause a certificate of merger (the
“Certificate of Merger”) to be duly executed and filed, in accordance with the DGCL, with the Secretary of State of the State of Delaware and shall make all other filings or recordings required in connection with the Merger. The
Merger shall become effective at the time such Certificate of Merger shall have been duly filed with, and accepted by, the Secretary of State of the State of Delaware or such later date and time as is agreed upon by the Parties and specified in the
Certificate of Merger (such date and time hereinafter referred to as the “Effective Time”).
Section 1.3
Closing. Upon the terms and subject to the conditions set forth in this Agreement, the closing of the Merger (the “Closing”) will take place at 10:00 a.m., Chicago time, on the fifth (5th) Business Day after satisfaction or waiver of the last of the conditions set forth in Article VI (other than those conditions that by their nature may only be satisfied on the Closing
Date, but subject to the satisfaction or waiver of such conditions on the Closing Date), by electronic exchange of documents and signatures, unless another time or date is agreed to in writing by the Parties hereto. The date on which the Closing
actually occurs is referred to herein as the “Closing Date.”
2
Section 1.4 Directors and Officers of the Surviving Corporation. The directors and
officers of Merger Sub immediately prior to the Effective Time shall, from and after the Effective Time, be the directors and officers of the Surviving Corporation, in each case until their respective successors shall have been duly elected or
appointed and qualified, or until their earlier death, resignation or removal in accordance with the Surviving Corporation’s certificate of incorporation and bylaws and applicable Laws.
ARTICLE II
MERGER
CONSIDERATION; CONVERSION OF STOCK
Section 2.1 Conversion of Company Stock. At the Effective Time, by virtue of the
Merger and without any action on the part of Parent, the Company or Merger Sub or any holder of any securities of any of the foregoing:
(a) Capital Stock of Merger Sub. Each share of common stock of Merger Sub, par value $0.01 per share, issued and outstanding
immediately prior to the Effective Time shall be converted into and become one (1) validly issued, fully paid and nonassessable share of common stock of the Surviving Corporation, par value $0.01 per share.
(b) Cancellation of Shares. Each outstanding or issued Share that is owned by Parent, Merger Sub or the Company, or by any Subsidiary
of Parent, Merger Sub or the Company, immediately prior to the Effective Time (except to the extent held by any such person on behalf of a third party) (collectively, the “Excluded Shares”), shall automatically be canceled and shall
cease to exist, and no cash, stock or other consideration shall be delivered or deliverable in exchange therefor.
(c) Conversion of
Shares. Each Share issued and outstanding immediately prior to the Effective Time (other than Excluded Shares and Dissenting Shares) shall automatically be converted into the right to receive cash in an amount, without interest, equal to the Per
Share Merger Consideration. As of the Effective Time, all such Shares shall no longer be outstanding and shall automatically be canceled and shall cease to exist, and each holder of a certificate representing any such Shares (a
“Certificate”) or book-entry Shares (“Book-Entry Shares”) (other than Dissenting Shares and Excluded Shares) shall cease to have any rights with respect to such Shares, except, in all cases, the right to receive the
Per Share Merger Consideration, without interest, in accordance with Section 2.2, and each Certificate formerly representing Dissenting Shares (and each Dissenting Share that is a Book-Entry Share) shall thereafter only represent the
right to receive the payment to which reference is made in Section 2.2(i). The right of any holder of any Share to receive the Per Share Merger Consideration shall be subject to and reduced by the amount of any withholding that is
required under applicable Tax Law.
(d) Company Stock Awards. The Company shall take all requisite action so that:
(i) Each option outstanding immediately prior to the Effective Time to purchase Shares (“Company Stock
Option”) under any stock option plan of the Company, including the Remy International, Inc. Omnibus Incentive Plan and any other plan agreement or arrangement of the Company (collectively, the “Company Equity
3
Plan”), shall, at the Effective Time, automatically and without any required action on the part of the holder thereof, be fully vested and canceled and, in exchange therefor, each
holder of any such canceled Company Stock Option shall be entitled to receive, in consideration of the cancellation of such Company Stock Option and in settlement therefor, a payment in cash of an amount equal to the product of (i) the vested
portion of the total number of Shares subject to such canceled Company Stock Option and (ii) the excess, if any, of (A) the Per Share Merger Consideration over (B) the exercise price per Share subject to such canceled Company Stock
Option, without interest (such amounts payable hereunder, the “Option Payments”); provided, however, that (i) any such Company Stock Option with respect to which the exercise price per Share subject thereto is
equal to or greater than the Per Share Merger Consideration shall be canceled in exchange for no consideration and (ii) such Option Payments may be reduced by the amount of any required Tax withholdings. The Option Payments shall be made in
accordance with Section 2.2(j). From and after the Effective Time, no Company Stock Option shall be exercisable and each Company Stock Option shall only entitle the holder thereof to the payment provided for in this
Section 2.1(d)(i).
(ii) Each stock appreciation right outstanding immediately prior to the Effective Time
under the Company Equity Plan (a “Company SAR”), shall, at the Effective Time, automatically and without any required action on the part of the holder thereof, be fully vested and canceled and, in exchange therefor, each holder of
any such canceled Company SAR shall be entitled to receive, in consideration of the cancellation of such Company SAR and in settlement therefor, a payment in cash of an amount equal to the product of (i) the vested portion of the total number
of Shares subject to such canceled Company SAR and (ii) the excess, if any, of (A) the Per Share Merger Consideration over (B) the base price per Share subject to such canceled Company SAR, without interest (such amounts payable
hereunder, the “SAR Payments”); provided, however, that (i) any such Company SAR with respect to which the base price per Share subject thereto is equal to or greater than the Per Share Merger Consideration shall
be canceled in exchange for no consideration and (ii) SAR Payments may be reduced by the amount of any required Tax withholdings. The SAR Payments shall be made in accordance with Section 2.2(j). From and after the Effective Time,
no Company SAR shall be exercisable and each Company SAR shall only entitle the holder thereof to the payment provided for in this Section 2.1(d)(ii).
(iii) Each award of Shares outstanding immediately prior to the Effective Time that is subject to forfeiture or other
restrictions (“Restricted Shares”) granted pursuant to a Company Equity Plan shall, at the Effective Time, automatically and without any required action on the part of the holder thereof, be fully vested (with any performance-based
vesting conditions treated as vested at the target performance level) and all restrictions (including forfeiture restrictions) otherwise applicable to such vested Shares shall lapse and such Shares shall be converted into the right to receive the
Per Share Merger Consideration pursuant to Section 2.1(c). Payments to the holders of Restricted Shares pursuant to this Section 2.1(d)(iii) shall be made in accordance with Section 2.2(j).
(iv) Each restricted stock unit award and each other right of any kind, contingent or accrued, to acquire or receive payments
measured by the value of Shares,
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and each award of any kind consisting of Shares that may be held, awarded, outstanding, payable or reserved for issuance under the Company Equity Plan, other than Company Stock Options, Company
SARs and Restricted Shares (a “Company Phantom Award”), shall, at the Effective Time, automatically and without any required action on the part of the holder thereof, be fully vested (with any performance-based vesting conditions
treated as vested at the target performance level) and cancelled and, in exchange therefor, each holder of such Company Phantom Award shall be entitled to receive, in consideration of the cancellation of such Company Phantom Award and in settlement
therefor, a payment in cash of an amount equal to the product of (i) the number of Shares subject to such Company Phantom Award immediately prior to the Effective Time and (ii) the Per Share Merger Consideration, without interest (such
amounts payable hereunder, the “Phantom Payments”) provided, however, that such Phantom Payments may be reduced by the amount of any required Tax withholdings. The Phantom Payments shall be made in accordance with
Section 2.2(j), provided, that, with respect to any Company Phantom Awards that constitute nonqualified deferred compensation subject to Section 409A of the Code and that are not permitted to be paid at the Effective
Time without triggering a Tax or penalty under Section 409A of the Code, such payment shall be made at the earliest time permitted under the applicable Stock Plan and award agreement that will not trigger a Tax or penalty under
Section 409A of the Code.
(v) At or prior to the Effective Time, the Company shall adopt any resolutions and take any
actions that are necessary to (x) effectuate the treatment of the Company Stock Options, Company SARs, Restricted Shares and Company Phantom Awards (collectively, the “Company Equity Awards”) pursuant to
Section 2.1(d)(i) through Section 2.1(d)(iv) and (y) cause the Company Equity Plan to terminate at or prior to the Effective Time. The Company shall take all actions necessary to ensure that from and after the Effective
Time neither Parent nor the Surviving Corporation will be required to deliver Shares or other capital stock of the Company to any Person pursuant to or in settlement of Company Equity Awards.
(vi) At or prior to the Effective Time, the Company shall adopt any resolutions and take any actions that are necessary to
cause, and shall amend the Remy International, Inc. 2015 Non-Qualified Employee Stock Purchase Plan (the “Company ESPP”) as may be necessary to provide that the Company ESPP shall be terminated effective immediately prior to the
Effective Time and no purchase period shall commence after the date of this Agreement.
(e) Anti-Dilution. Notwithstanding anything
in this Agreement to the contrary, if, from the date of this Agreement until the Effective Time, the number of outstanding Shares shall have been changed into a different number of Shares or a different class by reason of any reclassification, stock
split (including a reverse stock split), recapitalization, business combination, tender or exchange offer, readjustment or other similar transaction, or a stock dividend or stock distribution thereon shall be declared with a record date within said
period, the Per Share Merger Consideration shall be appropriately adjusted to provide the holders of Shares the same economic effect as contemplated by this Agreement prior to such event; provided, however, that (i) in no event
shall the aggregate amount payable by Parent pursuant to Section 2.2 after giving effect to any such event exceed the amount that would have been payable
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pursuant to Section 2.2 had such event not occurred and (ii) nothing in this Section 2.1 shall permit the Company to take any action with respect to its securities
that is expressly prohibited by the terms of this Agreement.
Section 2.2 Disposition of Certificates and Book-Entry Shares.
(a) Paying Agent. Prior to the Closing, Parent shall appoint a U.S.-based nationally recognized bank or trust company to act as
paying agent (the “Paying Agent”) for the payment of the Per Share Merger Consideration to the holders of the Shares. Parent will enter into a paying agent agreement with the Paying Agent (the “Paying Agent
Agreement”) on terms reasonably acceptable to Parent and the Company prior to the Closing. Prior to or at the Closing, Parent shall deposit with the Paying Agent cash in immediately available funds in the amount necessary for payment in
accordance with Section 2.1 and this Section 2.2 of the aggregate Per Share Merger Consideration payable pursuant to this Agreement (such total deposited cash being hereinafter referred to as the “Payment
Fund”). The Paying Agent shall make payments of the Per Share Merger Consideration out of the Payment Fund in accordance with this Agreement and the Paying Agent Agreement. The Payment Fund shall not be used for any other purpose.
(b) Stock Transfer Books. At the Effective Time, the stock transfer books of the Company shall be closed and thereafter there shall be
no further registration of transfers of Shares on the records of the Company. From and after the Effective Time, the holders of Certificates and Book-Entry Shares representing ownership of Shares outstanding immediately prior to the Effective Time
shall cease to have rights with respect to such Shares except as otherwise provided for herein. From and after the Effective Time, any Certificates or Book-Entry Shares presented to the Paying Agent, Parent or the Surviving Corporation for any
reason (other than Certificates or Book-Entry Shares representing Excluded Shares and Dissenting Shares) shall be canceled and exchanged for the Per Share Merger Consideration payable in respect of such Shares pursuant to this Article II.
(c) Payment Procedures.
(i) As soon as possible after the Effective Time (and in any event within three (3) Business Days thereafter), Parent and
the Surviving Corporation shall cause the Paying Agent to mail to each holder of record of a Certificate or Certificates that immediately prior to the Effective Time represented outstanding Shares (other than Excluded Shares and Dissenting Shares)
(A) a letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Certificates shall pass to the Paying Agent, only upon delivery of the Certificates (or affidavits of loss in lieu thereof) to
the Paying Agent, and which letter shall be in such form and have such other provisions as Parent and the Company may reasonably agree) and (B) instructions for use in effecting the surrender of the Certificates (or affidavits of loss in lieu
thereof) in exchange for the Per Share Merger Consideration to which the holder thereof is entitled. Upon surrender of any Certificate (or affidavit of loss in lieu thereof) to the Paying Agent, together with such letter of transmittal, duly
executed and completed in accordance with the instructions thereto, and such other documents as may be reasonably required by the Paying Agent, the holder of such Certificate shall be entitled to receive in exchange therefor an amount of cash in
immediately available funds equal to (x) the
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number of Shares represented by such Certificate (or affidavits of loss in lieu thereof) multiplied by (y) the Per Share Merger Consideration (less any required Tax withholdings as provided
in Section 2.2(h)), and the Certificate so surrendered shall forthwith be canceled. In the event of a transfer of ownership of Shares that is not registered in the transfer records of the Company, payment may be made to a Person other
than the Person in whose name the Certificate so surrendered is registered, if such Certificate shall be properly endorsed or otherwise be in proper form for transfer and the Person requesting such payment shall pay any transfer or other Taxes
required by reason of the payment to a Person other than the registered holder of such Certificate or establish to the satisfaction of Parent that such Tax has been paid or is not applicable. No interest shall be paid or accrue on any cash payable
pursuant to this Section 2.2.
(ii) Notwithstanding anything to the contrary in this Agreement, any holder of
Book-Entry Shares shall not be required to deliver a Certificate or an executed letter of transmittal to the Paying Agent to receive the Per Share Merger Consideration that such holder is entitled to receive pursuant to this Article
II. In lieu thereof, each holder of record of one or more Book-Entry Shares whose Shares were converted into the right to receive the Per Share Merger Consideration shall upon receipt by the Paying Agent of an “agent’s
message” in customary form (or such other documentation or evidence, if any, as the Paying Agent may reasonably request), be entitled to receive, and Parent shall cause the Paying Agent to pay and deliver as promptly as reasonably practicable
after the Effective Time, the Per Share Merger Consideration in respect of each such Share (less any required Tax withholdings as provided in Section 2.2(h)), and the Book-Entry Shares of such holder shall forthwith be cancelled.
(d) Termination of Payment Fund. Any portion of the Payment Fund which remains unclaimed for six (6) months after the Effective
Time shall be delivered to the Surviving Corporation, and any holders of Shares prior to the Effective Time who have not theretofore complied with this Article II shall thereafter look only to the Surviving Corporation and only as general
creditors thereof for payment of the Per Share Merger Consideration (subject to abandoned property, escheat or similar Laws).
(e) No
Liability. None of Parent, Merger Sub, the Surviving Corporation, the Company or the Paying Agent, or any employee, officer, director, agent, representative or Affiliate thereof, shall be liable to any Person in respect of the Per Share Merger
Consideration from the Payment Fund properly delivered to a public official pursuant to any applicable abandoned property, escheat or similar Law.
(f) Investment of Payment Fund. The Paying Agent shall invest the Payment Fund as directed by Parent (on behalf of the Surviving
Corporation); provided that such investments shall be in obligations of or guaranteed by the United States of America or in commercial paper obligations rated A-1 or P-1 or better by Moody’s Investors Service, Inc. or Standard &
Poor’s Corporation, respectively or in funds investing solely in such obligations that provide for same day liquidity. Any net profit resulting from, or interest or income produced by, such investments shall be paid to the Surviving Corporation
or Parent (at Parent’s election). To the extent that there are losses with respect to such investments, or the Payment Fund diminishes for other reasons below the level required to make prompt cash payments of the aggregate Per Share
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Merger Consideration as contemplated hereby, Parent shall promptly replace or restore the portion of the Payment Fund required so as to ensure that the Payment Fund is, at all times, maintained
at a level sufficient to make such payments.
(g) Lost Certificates. If any Certificate shall have been lost, stolen or destroyed,
upon the making of an affidavit of that fact by the Person claiming such Certificate to be lost, stolen or destroyed, and, if required by Parent or the Paying Agent, the posting by such Person of a bond in such reasonable and customary amount as
Parent or the Paying Agent may direct as indemnity against any claim that may be made against it or the Surviving Corporation or any of their Affiliates with respect to such Certificate, the Paying Agent will issue in exchange for such lost, stolen
or destroyed Certificate the Per Share Merger Consideration payable in respect thereof, pursuant to this Agreement.
(h) Withholding
Rights. Parent, the Surviving Corporation or the Paying Agent, as applicable, shall be entitled to deduct and withhold from the consideration otherwise payable pursuant to this Agreement to any Person such amounts as it is required to deduct and
withhold with respect to the making of such payment under the Internal Revenue Code of 1986, as amended (the “Code”), and the rules and regulations promulgated thereunder, or any provision of state, local or foreign Tax Law. To the
extent that amounts are so withheld, such withheld amounts shall be treated for all purposes of this Agreement as having been paid to the Person in respect of which such deduction and withholding was made.
(i) Appraisal Rights. Notwithstanding anything in this Agreement to the contrary, Shares outstanding immediately prior to the Effective
Time and held by a holder who is entitled to demand and properly demands appraisal of such shares (“Dissenting Shares”) pursuant to, and who complies in all respects with, Section 262 of the DGCL (the “Appraisal
Rights”) shall not be converted into the right to receive the Per Share Merger Consideration. Such holders shall be entitled to receive such consideration as is determined to be due with respect to such Dissenting Shares in accordance with
Section 262 of the DGCL; provided, however, that if any such holder shall fail to perfect or otherwise shall waive, withdraw or lose the right to appraisal under the Appraisal Rights, then the right of such holder to be paid such
consideration as is determined to be due pursuant to Section 262 of the DGCL shall cease and such Dissenting Shares shall be deemed to have been converted as of the Effective Time into, and to have become exchangeable solely for the right to
receive, the Per Share Merger Consideration, without interest and reduced by the amount of any withholding that is required under applicable Tax Law. The Company shall promptly deliver to Parent notice of any written demands received by the Company
for appraisal of any Shares, and Parent shall have the right to participate in all negotiations and proceedings with respect to such demands. The Company shall not without the prior written consent of Parent make any payment with respect to (unless
required by a Governmental Entity of competent jurisdiction pursuant to a final non-appealable order), or offer to make any such payment or settle or offer to settle, any such demands.
(j) Company Equity Award Payments. Promptly after the Effective Time (and not later than the first regularly scheduled
payroll date not less than five Business Days after the Effective Time), the Surviving Corporation shall pay the Option Payments, SAR Payments, Phantom Payments and the payments to the recipients of Restricted Shares due pursuant to
Section 2.1(d)(i), Section 2.1(d)(ii), Section 2.1(d)(iii) and Section 2.1(d)(iv), respectively, through its payroll systems.
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ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as (a) set forth in the corresponding section or subsection of the disclosure letter delivered by the Company to Parent prior to
the execution and delivery of this Agreement (the “Company Disclosure Letter”) which shall be arranged according to the sections contained in this Article III (it being understood that the disclosure of any item in any
section or subsection of the Company Disclosure Letter shall be deemed disclosure with respect to each other section or subsection in this Article III to the extent (and only to the extent) that it is reasonably apparent from the face of such
disclosure that such disclosure also qualifies or applies to such other section or subsection) or (b) disclosed in the Company SEC Documents filed with, or furnished to, the SEC and publicly available on the SEC’s EDGAR website not less
than one (1) Business Day prior to the date of this Agreement (including exhibits, annexes and schedules attached to or incorporated by reference into such Company SEC Documents) (“Publicly Available Company SEC Documents”)
(excluding any risk factor disclosures contained in the “Risk Factors” section thereof, any disclosure of risks contained in any “forward-looking statements” disclaimer, or any other disclosure or statements to the extent they
are similarly predictive or forward-looking in nature); provided, however, that the disclosures in the Company SEC Documents shall not be deemed to qualify any representations or warranties made in Section 3.2, 3.3,
3.24, 3.25 or 3.26, the Company represents and warrants to Parent and Merger Sub as follows:
Section 3.1
Organization, Standing and Power.
(a) Section 3.1 of the Company Disclosure Letter contains a complete and accurate list of
the name and jurisdiction of organization of the Company and each of its Subsidiaries (each of the Company and its Subsidiaries is referred to herein as an “Acquired Company” and, collectively, as the “Acquired
Companies”) as of the date of this Agreement. The Company is a corporation duly incorporated, 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 assets and to carry on its business as now being conducted. Each (i) Subsidiary of the Company is an entity duly organized, validly existing and (to the extent such concept exists in the jurisdiction where
the applicable entity is organized) in good standing under the Laws of the jurisdiction of its organization and has all requisite corporate or similar power and authority to own, lease and operate its properties and assets and to carry on its
business as now being conducted and (ii) Acquired Company is duly qualified or licensed to do business and (to the extent such concept exists in the applicable jurisdiction) is in good standing in each jurisdiction in which the nature of its
business or the ownership, leasing or operation of its properties and assets makes such qualification or licensing necessary, except with respect to each of clause (i) and clause (ii) as, individually or in the aggregate,
would not reasonably be expected to have a Material Adverse Effect.
(b) The Company has made available to Parent true, correct and
complete copies of (i) the Company’s certificate of incorporation and bylaws (collectively, the “Company
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Constituent Documents”) and (ii) the certificate of incorporation, articles of incorporation, bylaws and other charter or comparable organizational documents of each of the
Company’s Significant Subsidiaries (the “Subsidiary Organizational Documents”), in the case of each of clause (i) and clause (ii), including all amendments thereto. The Company Constituent Documents are in full force and
effect and the Company is not in violation of their provisions. Except as, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect, the Subsidiary Organizational Documents are in full force and effect and
no Subsidiary is in violation of its Subsidiary Organizational Documents. The Company has no Subsidiaries, except for the entities identified in Section 3.1(a) of the Company Disclosure Letter. None of the Acquired Companies has any equity
interest in, or any material interest convertible into or exchangeable or exercisable for any equity interest in, any other entity other than (x) another Acquired Company or (y) for securities held in connection with such Acquired
Company’s passive investing activities.
Section 3.2 Capital Stock.
(a) Each of the outstanding shares of capital stock or other equity interests of each Subsidiary of the Company is duly authorized, validly
issued, fully paid and nonassessable and free of, and not issued in violation of, any preemptive rights. All shares and other equity interests of the Subsidiaries of the Company are owned by the Company or another wholly owned Subsidiary of the
Company free and clear of (except in the case of Subsidiaries that are not Significant Subsidiaries, as would not, individually or in the aggregate, be material to the Acquired Companies, taken as a whole) all security interests, liens, claims,
pledges, charges, mortgages or other encumbrances (collectively, “Liens”) of any nature whatsoever, except for restrictions on transfer under securities Laws.
(b) The authorized capital stock of the Company consists of (i) 240,000,000 Shares and (ii) 40,000,000 preferred shares, par value
$0.0001 per share (“Preferred Shares”). As of the close of business on July 9, 2015 (the “Specified Date”), there were (i) 31,802,084 Shares (which includes 360,566 Restricted Shares) issued and
outstanding, not including Shares held in treasury, (ii) no Preferred Shares issued and outstanding, (iii) 719,100 Shares subject to issuance pursuant to the exercise of outstanding Company Stock Options under the Company Equity Plan (with
a weighted-average exercise price of $21.71), (iv) 20,038 Company SARs outstanding under the Company Equity Plan (representing SAR Payments of $163,363 in the aggregate if the Closing occurred on the Specified Date), (v) 11,166 Company
Phantom Awards outstanding under the Company Equity Plan (representing Phantom Payments of $329,397 in the aggregate if the Closing occurred on the Specified Date), (vi) 2,815,148 Shares reserved for issuance and available for grant under the
Company Equity Plan (not including the Shares in clause (iii), or with respect to the Company Equity Awards in clauses (iv) and (v), above) and (vii) 600,000 Shares reserved for issuance under the Company ESPP. Except as set forth
above, (A) there are not outstanding or authorized (1) any securities of any Acquired Company convertible into or exchangeable for shares of capital stock or voting securities of any Acquired Company or (2) any options, calls,
warrants, pre-emptive rights, anti-dilution rights or shareholder rights plans, or other similar rights, agreements or commitments, that obligate any Acquired Company to issue or sell any shares of capital stock or other equity securities of any
Acquired Company or any securities or obligations convertible into or exchangeable for capital stock or voting securities of any Acquired Company (excluding, in the case of each of clause (1) and clause (2), solely with
10
respect to Acquired Companies that are wholly owned Subsidiaries of the Company, any of the foregoing that are solely for the benefit of other wholly-owned Acquired Companies that are its
shareholders), (B) there are no outstanding obligations of any Acquired Company to repurchase, redeem or otherwise acquire any capital stock, voting securities, or securities convertible into or exchangeable for capital stock or voting
securities, or to provide funds to, or make any investment (in the form of a loan, capital contribution or otherwise) in, any Acquired Company that is not a wholly-owned Subsidiary of the Company, (C) no Acquired Company has outstanding any
phantom stock, restricted stock units or other contractual rights the value of which is determined in whole or in part by the value of any capital stock of any Acquired Company and there are no outstanding stock appreciation rights issued by any
Acquired Company with respect to the capital stock of any Acquired Company (the items described in clauses (A) and (C), “Company Stock Equivalents”), (D) there are no voting trusts or other agreements or understandings to
which any of the Acquired Companies is a party with respect to the voting of capital stock of any Acquired Company, and (E) there are no outstanding bonds, debentures, notes or other indebtedness of any Acquired Company having the right to vote
(or convertible into, or exchangeable for, securities having the right to vote) on any matter on which the stockholders or other equity holders of the Acquired Companies may vote (“Company Voting Debt”), other than for, in the case
of each of clauses (A) through (D), (solely with respect to Subsidiaries of the Company that are not Significant Subsidiaries (and that are not otherwise, individually or in the aggregate, material to the Company) (“Immaterial
Subsidiaries”)) any of the items set forth in any of clauses (A) through (D) that (x) apply solely with respect to Immaterial Subsidiaries and (y) are not, individually or in the aggregate, material to the Company. From
the close of business on the Specified Date through the date of this Agreement, the Company has not issued any Shares (other than for Shares in respect of Company Stock Options granted and outstanding as of the close of business on the Specified
Date) or other class of Company equity security. Each of the outstanding Shares is, and each Share that is issued after the execution hereof pursuant to any Company Stock Option or other Company Equity Award will be (when issued in accordance with
the terms thereof), duly authorized, validly issued, fully paid and nonassessable and free of, and not issued in violation of, any preemptive rights.
(c) Section 3.2(c) of the Company Disclosure Letter sets forth a complete and accurate list of the following information
with respect to each Company Equity Award outstanding as of the close of business on the Specified Date: (i) the name of the holder of each Company Equity Award; (ii) the number of Shares subject to each such Company Equity Award held by
such holder; (iii) the grant date, exercise or base price, expiration date and vesting schedule of each such Company Equity Award, as applicable; (iv) the extent to which such Company Equity Award is vested and exercisable as of the date
of this Agreement and (v) the Company Equity Plan pursuant to which each such Company Equity Award was granted. The exercise price of each Company Stock Option is equal to or greater than the fair market value of the Shares subject to such
Company Stock Option (determined as of the date such Company Stock Option was granted). Each Company Stock Option intended to qualify as an “incentive stock option” under Section 422 of the Code, if any, so qualifies. Each Company
Equity Award, by its terms, shall be treated at the Effective Time as set forth in Section 2.1(d)(i), (ii), (iii) or (iv), as applicable.
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Section 3.3 Authority.
(a) The Company has all necessary corporate power and authority to execute and deliver this Agreement and the Voting Agreement and to perform
its obligations hereunder and thereunder and, subject, in the case of the Merger, to the adoption of this Agreement by the holders of at least a majority of the outstanding Shares entitled to vote thereon (the “Company Stockholder
Approval”), to consummate the transactions contemplated hereby and thereby. The execution, delivery and performance of this Agreement and the Voting Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby and thereby have been duly authorized by all necessary corporate action on the part of the Company (other than the Company Stockholder Approval), and no other corporate proceedings on the part of the Company are necessary to
approve this Agreement or to consummate the transactions contemplated hereby or thereby, subject, in the case of the consummation of the Merger, to obtaining the Company Stockholder Approval and to the filing of the Certificate of Merger with the
Secretary of State of the State of Delaware as required by the DGCL. Each of this Agreement and the Voting Agreement has been duly and validly executed and delivered by the Company and, assuming the due authorization and the valid execution and
delivery of this Agreement and the Voting Agreement by the other parties hereto and thereto constitutes a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms (except to the extent that
enforceability may be limited by applicable bankruptcy, insolvency, fraudulent transfer, moratorium, reorganization or similar Laws relating to or affecting creditors’ rights generally or by general principles of equity).
(b) The Company Board, at a meeting duly called and held, has unanimously (i) approved and declared advisable this Agreement and the
transactions contemplated by this Agreement, including the Merger, upon the terms and subject to the conditions set forth herein, (ii) determined that this Agreement and such transactions are fair to, and in the best interests of, the Company
and its stockholders (other than Parent and its Subsidiaries) (such determination, the “Company Determination”), and (iii) adopted a resolution recommending that this Agreement be adopted by the stockholders of the Company in
accordance with the provisions of the DGCL (such recommendation, the “Company Recommendation”), which resolution has not been rescinded, modified or withdrawn in any way except, if applicable, to the extent permitted by
Section 5.3. The Company Stockholder Approval is the only vote of the holders of any class or series of capital stock or other securities of the Company required to consummate the Merger. Neither the affirmative vote of the holders of
outstanding Shares or of any other securities of the Company is necessary to consummate any transaction contemplated by this Agreement other than the Merger.
Section 3.4 No Conflict; Consents and Approvals.
(a) The execution, delivery and performance of this Agreement by the Company do not, and the consummation by the Company of the Merger will
not, (i) conflict with or violate the Company Constituent Documents or the Subsidiary Organizational Documents, (ii) assuming that all consents, approvals and authorizations contemplated by clauses (i) through (v) of
subsection (b) below have been obtained and all notices and filings described in such clauses have been made, violate any U.S. or foreign statute, law, ordinance, rule, regulation, order, judgment or decree (collectively,
“Law”) or any settlement, injunction or award of any
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Governmental Entity, in each case that is applicable to the Company or any of its Subsidiaries, or (iii) result in any breach or violation of, result in a counterparty having a contractual
right to a change of control or similar payment or to an increase in benefits under, constitute a default (or an event which with notice or lapse of time or both would become a default) under, give rise to any right of termination, cancellation or
acceleration of, or result in the creation of any Lien upon any of the material properties or assets of the Acquired Companies pursuant to the terms of, any Material Contract or other Contract to which the Company or any of its Subsidiaries is a
party, except in the case of clauses (ii) and (iii) above, as, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect.
(b) The execution, delivery and performance of this Agreement by the Company, and the consummation by the Company of the transactions
contemplated hereby, do not require any consent, approval, order, authorization or permit of, action by, filing, registration or declaration with or notification to, any U.S. or non-U.S. governmental or regulatory authority, agency, court,
commission, other governmental body or national stock exchange (each, a “Governmental Entity”), except (i) as required under applicable requirements of the Securities Exchange Act of 1934, as amended (the “Exchange
Act”) (and the rules and regulations promulgated thereunder) (including the filing of the Proxy Statement) and under state securities and “blue sky” Laws, (ii) as required under the Hart-Scott-Rodino Antitrust Improvements
Act of 1976, as amended (the “HSR Act”) or under any other applicable Antitrust Law, (iii) pursuant to the applicable requirements of the NASDAQ Global Select Market, (iv) for the filing with the Secretary of State of the
State of Delaware of the Certificate of Merger as required by the DGCL and appropriate documents with the relevant authorities of other states or jurisdictions in which the Company or any of its Subsidiaries is qualified to do business, (v) as
required in connection with any matter set forth in Section 3.4(b) of the Company Disclosure Letter, and (vi) as, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect.
Section 3.5 SEC Reports; Financial Statements.
(a) The Company and its Subsidiaries have filed or furnished, as applicable, all forms, reports, statements, schedules, certifications and
other documents (including all exhibits, amendments and supplements thereto) required to be filed or furnished by them with or to the United States Securities and Exchange Commission (the “SEC”) since January 1, 2013 (all such
forms, reports, statements, schedules, certificates, documents, exhibits and other information incorporated therein, collectively, the “Company SEC Documents”). As of their respective dates, or, if amended, as of the date of the
last such amendment, each of the Company SEC Documents complied in all material respects with the applicable requirements of the Securities Act of 1933, as amended (the “Securities Act”), the Exchange Act and the Sarbanes-Oxley Act
of 2002 (“SOX”), and the applicable rules and regulations promulgated thereunder, as the case may be, each as in effect on the date so filed or furnished, as applicable. Except to the extent that information in any Company SEC
Document has been amended, revised or superseded by a Company SEC Document subsequently filed or furnished (any such amendment, revision or superseding document with respect to a Company SEC Document filed or furnished prior to the date hereof
having also been filing or furnished prior to the date hereof), none of the Company SEC Documents contains any untrue statement of a material fact or omits to state a material fact required to be stated or incorporated by reference therein or
necessary in order to make the statements therein, in the light of the circumstances under which they were made, not
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misleading. No Subsidiary of the Company is subject to the periodic reporting requirements of the Exchange Act or of any foreign Governmental Entity that performs a similar function to that of
the SEC or of any securities exchange or quotation system.
(b) The consolidated annual and quarterly financial statements of the Company
and its Subsidiaries (including any related notes thereto) that are included in the Company SEC Documents (i) comply as to form in all material respects with the published rules and regulations of the SEC applicable thereto and
(ii) present fairly in all material respects the consolidated financial position of the Company and its Subsidiaries at the respective dates thereof and the consolidated results of their operations, cash flows and changes in stockholders’
equity for the periods indicated therein (subject, in the case of unaudited financial statements, to notes and normal year-end audit adjustments), in each case in conformity with United States generally accepted accounting principles
(“GAAP”) applied on a consistent basis throughout the periods involved (except as may be indicated in the notes thereto).
(c) The Company (i) maintains “disclosure controls and procedures” and “internal control over financial reporting”
(as such terms are defined in paragraphs (e) and (f), respectively, of Rule 13a-15 under the Exchange Act) as required by Rule 13a-15 under the Exchange Act and (ii) as of the date of this Agreement, has disclosed, based on its
most recent evaluation prior to the date of this Agreement, to the Company’s outside auditors and the audit committee of the Company Board (A) any significant deficiencies and material weaknesses in the design or operation of such internal
control over financial reporting that are reasonably likely to adversely affect in any material respect the Company’s ability to record, process, summarize and report financial information and (B) any fraud, whether or not material, that
involves management or other employees who have a significant role in the Company’s internal control over financial reporting. The Company’s “disclosure controls and procedures” are reasonably designed to ensure that all material
information required to be disclosed by the Company in the reports that it files or furnishes under the Exchange Act is recorded and reported on a timely basis to the individuals responsible for the preparation of the Company’s filings with the
SEC. The Company’s management has completed an assessment of the effectiveness of the Company’s internal control over financial reporting in compliance with the requirements of Section 404 of SOX, and based on Company
management’s most recent such assessment prior to the date of this Agreement, the chief executive officer and chief financial officer of the Company concluded that such controls were effective. The Company’s system of “internal
control over financial reporting” (as defined in Rule 13a-15(f) under the Exchange Act) is reasonably sufficient in all material respects to provide reasonable assurance regarding the reliability of financial reporting and the preparation
of financial statements for external purposes in accordance with GAAP and includes policies and procedures that (i) pertain to the maintenance of records that in reasonable detail accurately and fairly reflect the transactions and dispositions
of assets of the Company and its Subsidiaries, (ii) provide reasonable assurance that Company transactions are recorded as necessary to permit preparation of the consolidated financial statements of the Company and its Subsidiaries in
accordance with GAAP, and that receipts and expenditures of the Company and its Subsidiaries are being made only in accordance with the authorization of management, and (iii) provide reasonable assurance regarding prevention or timely detection
of unauthorized acquisition, use or disposition of the assets of the Company and its Subsidiaries that would materially affect the consolidated financial statements of the Company and its Subsidiaries.
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(d) Since January 1, 2013, (i) neither the Company nor any Subsidiary of the Company
which was then a reporting company under the Exchange Act, nor to the knowledge of the Company, any director, officer or outside auditor of the Company or any such Subsidiary, has received or otherwise had or obtained knowledge of any material
complaint, allegation, assertion or claim, whether written or oral, regarding the accounting or auditing practices, procedures, methodologies or methods of the Company or any of its Subsidiaries or their respective internal accounting controls,
including any material complaint, allegation, assertion or claim that the Company or any of its Subsidiaries has engaged in questionable accounting or auditing practices and (ii) no attorney representing the Company or any of its Subsidiaries,
whether or not employed by the Company or any of its Subsidiaries, has reported evidence of a material violation of securities laws, breach of fiduciary duty or similar violation by the Company or its Subsidiaries or any of their officers,
directors, employees or agents to the Company Board or any committee thereof (or the board of directors of the Company’s predecessor as a public company or any committee thereof) or to any director or executive officer of the Company (or of its
predecessor as a public company).
(e) The Company has made available to Parent true and complete copies of all written comment letters
from the staff of the SEC received from January 1, 2013 to the date of this Agreement relating to the Company SEC Documents and all written responses of the Company or its Subsidiaries thereto other than with respect to any requests for
confidential treatment. As of the date of this Agreement, (i) there are no outstanding or unresolved comments in comment letters received from the SEC staff with respect to any Company SEC Documents and (ii) to the knowledge of the
Company, none of the Company SEC Documents (other than any confidential treatment requests) is under ongoing SEC review. As of the date of this Agreement, to the knowledge of the Company, there are no SEC inquiries or investigations or other
governmental inquiries or investigations pending or threatened, in each case regarding any accounting practices of the Company or its Subsidiaries.
Section 3.6 No Undisclosed Liabilities. Neither the Company nor any of its Subsidiaries has any liabilities or obligations of any
nature, whether or not accrued, contingent or otherwise, required by GAAP to be set forth on a consolidated balance sheet of the Company, except for liabilities and obligations (a) reflected or reserved against in the Company’s
consolidated balance sheet as at December 31, 2014 (or the notes thereto), (b) incurred in the ordinary course of business since December 31, 2014, (c) incurred in connection with this Agreement or the transactions contemplated
by this Agreement or (d) that, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect.
Section 3.7 Proxy Statement; Company Information. The information relating to the Company and its Subsidiaries to be contained in
the Proxy Statement and any other documents filed with the SEC in connection with this Agreement will comply as to form in all material respects with the requirements of applicable Law, and will not, on the date the Proxy Statement is first mailed
to holders of Shares or at the time of the Company Stockholders Meeting, contain any untrue statement of a material fact, or omit to state any material fact required to be stated therein or necessary in order to make the statements therein not
misleading at the time and in light of the circumstances under which such statement is made, except that no representation or warranty is made by the Company with respect to statements made or incorporated by reference therein based on information
supplied by Parent or Merger Sub for inclusion or incorporation by reference therein.
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Section 3.8 Absence of Certain Changes or Events. From and including January 1,
2015, (a) other than in connection with the negotiation and execution of this Agreement, the businesses of the Company and its Subsidiaries have been conducted in all material respects in the ordinary course of business consistent with past
practice, (b) there has not occurred any condition, event, change, circumstance or effect that, individually or in the aggregate, has had or would reasonably be expected to have, a Material Adverse Effect and (c) through the date of this
Agreement, there has not been any action taken or not taken that, if it occurred after the date hereof, would have resulted in a breach of clauses (b) (ii), (iv), (v), (ix), (xii), (xiv),
(xv)(A) (changing, for this purpose, the reference therein to “$200,000” to “$250,000”) and excluding any Company Equity Awards granted in the ordinary course with respect to the 2014 performance year, (xv)(B)
(other than actions taken in the ordinary course of business consistent with past practice), (xv)(C) (other than accelerations required in accordance with the terms of a Company Equity Plan), (xv)(D) or (xv)(E) (changing, for
this purpose, the reference therein to “$200,000” to “$250,000”), (xvi), (xvii), (xx), (xxiii), (xxv) or, to the extent relating to the foregoing, (xxviii) of
Section 5.1.
Section 3.9 Litigation.
(a) (i) There is no civil, criminal or administrative suit, claim, action, proceeding, arbitration or, to the knowledge of the Company,
investigation pending or, to the knowledge of the Company, threatened against the Company or any of its Subsidiaries or, to the knowledge of the Company, against any of their respective officers, directors or employees in their capacities as such,
that, individually or in the aggregate, has had or would reasonably be expected to have a Material Adverse Effect and (ii) neither the Company nor any of its Subsidiaries nor, to the knowledge of the Company, any of their respective officers,
directors or employees in their capacities as such, is subject to any judgment, order, injunction, ruling or decree of any Governmental Entity that, individually or in the aggregate, has had since January 1, 2013 or would reasonably be expected
to have a Material Adverse Effect.
(b) As of the date of this Agreement, there are no Actions pending or, to the knowledge of the
Company, threatened against the Company or any of its Subsidiaries that would, individually or in the aggregate, reasonably be expected to prevent, materially delay or impair the consummation of the Merger.
Section 3.10 Compliance with Laws.
(a) Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Material Adverse Effect, the
Company and each of its Subsidiaries are in, and at all times since January 1, 2013 have been in, compliance with all Laws applicable to them or by which any of their respective properties are bound.
(b) Except with respect to Environmental Laws (which are the subject of Section 3.13), the Company and its Subsidiaries have in
effect all permits, licenses, grants, easements, clearances, variances, exceptions, consents, certificates, exemptions, registrations,
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authorizations, franchises, orders and approvals of all Governmental Entities (collectively, “Permits”) necessary for them to own, lease, operate or use their properties and to
carry on their businesses as now conducted, except for any Permits the absence of which, individually or in the aggregate, has not had and would not reasonably be expected to have a Material Adverse Effect. All Permits of the Company and its
Subsidiaries are in full force and effect, except where the failure to be in full force and effect, individually or in the aggregate, has not had and would not reasonably be expected to have a Material Adverse Effect.
(c) Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Material Adverse Effect, neither
the Company nor any of its Subsidiaries is party to any Action that would reasonably be expected to result in the revocation, withdrawal, suspension, cancellation, termination, or modification with respect to any material Permit, nor to the
knowledge of the Company is any such Action threatened.
(d) To the knowledge of the Company, the Company and its Subsidiaries are not,
nor have they been since January 1, 2013, under investigation by the Department of Justice (the “DOJ”), the Department of Transportation, the Federal Trade Commission, any state Attorney General or any other Governmental
Entities for any violation of or non-compliance with any Laws that, individually or in the aggregate, has had or would reasonably be expected to have a Material Adverse Effect. To the knowledge of the Company, there is not pending and no Person has
filed since January 1, 2013 against the Company or any of its Subsidiaries a claim or action relating to the Company or its Subsidiaries under any foreign, federal or state whistleblower statute, including under the False Claims Act
(31 U.S.C. § 3729 et seq.) that, individually or in the aggregate, would reasonably be expected to have a Material Adverse Effect.
(e) The Company and its Subsidiaries are and at all times since January 1, 2013 have been in compliance in all respects with the U.S.
Foreign Corrupt Practices Act of 1977, as amended (15 U.S.C. §§ 78dd-1 et seq.), and any other similar foreign Laws applicable to them regarding the use of funds for political activity or commercial bribery
(collectively, “Anticorruption Laws”), except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Material Adverse Effect. To the knowledge of the Company, the Company is not as of the
date of this Agreement investigating any whistleblower allegations alleging non-compliance by the Company or any of its Subsidiaries with the Anticorruption Laws, other than as has not had and would not, individually or in the aggregate, reasonably
be expected to have a Material Adverse Effect. Except as, individually or in the aggregate, has not had and would not be reasonably expected to have a Material Adverse Effect, there are no situations with respect to the business of the Company or
any of its Subsidiaries which involved since January 1, 2013 or involve (i) the use of any Acquired Company funds for unlawful contributions, gifts, entertainment or other unlawful expenses related to political activity; or (ii) the
making of any direct or indirect unlawful payments to government officials or employees from Acquired Company funds. The Company and its Subsidiaries have instituted and maintain policies and procedures reasonably designed to ensure compliance with
applicable Anticorruption Laws.
(f) Except for such matters that have not had and, individually or in the aggregate, would not reasonably
be expected to have a Material Adverse Effect, to the extent applicable to the applicable Acquired Company, (i) the Company and its Subsidiaries are and at all times since
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January 1, 2013 have been in compliance with all applicable Law concerning the exportation of, or international trade in, any products, technology or technical data and services, including
any applicable such Law administered by the United States Department of Commerce, the United States Department of State, and the United States Department of the Treasury; and (ii) the Company and its Subsidiaries are in compliance with any
applicable anti-boycott regulations enacted and/or administered by the United States Department of Commerce and the European Union and any Member State of the European Union and with all applicable laws and regulations administered by the Bureau of
Customs and Border Protection in the United States Department of Homeland Security.
Section 3.11 Benefit Plans.
(a) Section 3.11(a)(i) of the Company Disclosure Letter sets forth a complete and accurate list of each material Company Plan. For
purposes of this Agreement, “Company Plan” means any “employee benefit plan” (within the meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974, as amended (“ERISA”), including
any “multiemployer plan” (within the meaning of ERISA Section 3(37)), and any stock purchase, stock option, other equity-based compensation, severance, change-in-control, fringe benefit, bonus, incentive, deferred compensation,
pension, retirement, profit-sharing, thrift, savings, unemployment benefits, sick leave, vacation pay, salary continuation for disability, hospitalization, health or medical insurance, life insurance, fringe benefit, flexible spending account,
scholarship, employment or other employee benefit plan, agreement, program, payroll practice, policy or other arrangement, whether or not subject to ERISA (including any funding mechanism therefor now in effect or required in the future as a result
of the transactions contemplated by this Agreement or otherwise), whether formal or informal, written, legally binding or not, and whether or not terminated, under which any current or former employee, director or independent contractor of the
Company or any of its Subsidiaries has any present or future right to benefits or the Company or any of its Subsidiaries has had or has any current or future potential liability (including contingent liability) to or on behalf of any current or
former employee, officer, director or independent contractor of the Company or any of its Subsidiaries (including an obligation to make contributions). Section 3.11(a)(ii) of the Company Disclosure Letter sets forth a true and complete list of
each Company Plan subject to Title IV of ERISA or the minimum funding requirements of Section 412 of the Code or Section 302 of ERISA maintained, sponsored, contributed to or required to be contributed to by the Company or any of its ERISA
Affiliates currently or with respect to which the Company or any of its ERISA Affiliates has had or has any current or future potential liability (including contingent liability) (each, a “Pension Plan”). With respect to each
Company Plan, the Company has made available to Parent a current, accurate and complete copy thereof and, to the extent applicable: (i) all plan documents, including all amendments, (ii) all related trust agreements or other funding
instruments, insurance contracts and administrative contracts, (iii) the most recent determination or opinion letter issued by the U.S. Internal Revenue Service (the “IRS”) with respect to such plan, (iv) the current
summary plan description, including any summaries of material modifications, (v) audited financial reports and Forms 5500 (including all schedules thereto), as filed, for the most recent plan year, (vi) the actuarial reports for the three
most recently completed plan years, (vii) all correspondence with any Governmental Entity received since January 1, 2012 which relates to any Action or potential Action involving a Company Plan and (vii) any discrimination, coverage
or similar annual tests performed during the last plan year.
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(b) With respect to the Company Plans:
(i) each Company Plan, other than Company Plans maintained by the Company or any of its Subsidiaries primarily for the benefit
of employees working outside the United States or otherwise subject to the Laws of any jurisdiction outside of the United States (each a “Foreign Company Plan”) has been established and administered in all material respects in
compliance with its terms and applicable Laws, including ERISA and the Code;
(ii) no transaction has occurred with respect
to any Company Plan that is an “employee benefit plan” within the meaning of Section 3(3) of ERISA (an “ERISA Plan”) that reasonably would subject the Company to either a civil penalty assessed pursuant to
Section 409, 502(i) or 502(l) of ERISA or a tax imposed pursuant to Section 4975 or 4976 of the Code in an amount that would be material and no material non-exempt prohibited transaction, as described in Section 406 of ERISA has
occurred with respect to any Company Plan;
(iii) all contributions required to be made under the terms of any Company Plan
and any applicable Laws have, in all material respects, been timely made and all obligations in respect of each Company Plan as of the date hereof have, in all material respects, been accrued and are reflected in the Company’s financial
statements to the extent required by GAAP;
(iv) each ERISA Plan intended to be qualified under Section 401(a) of the
Code has received a favorable determination, advisory and/or opinion letter, as applicable, from the IRS that it is so qualified and to the knowledge of the Company, nothing has occurred that would reasonably be expected to cause any such Company
Plan to not be so qualified where such occurrence, fact or circumstance, individually or in the aggregate, has had or would reasonably be expected to result in a material penalty under the IRS Closing Agreement Program if discovered during an IRS
audit or investigation;
(v) except as would not reasonably be expected to result in material liability to the Company or
any of its Subsidiaries, other than routine claims for benefits, there is no Action (including any investigation, audit or other administrative proceeding) by the Department of Labor, the Pension Benefit Guaranty Corporation, the IRS or any other
Governmental Entity or by any plan participant or beneficiary pending, or to the knowledge of the Company, threatened, relating to any of the Company Plans (or any assets of a trust related thereto) or any fiduciaries thereof with respect to their
duties to any of the Company Plans, nor, to the knowledge of the Company, are there facts and circumstances that exist that would reasonably be expected to give to any such Actions; and
(vi) each Foreign Company Plan (A) has been established, maintained and operated in all material respects in accordance
with all applicable requirements of Laws, (B) if intended to qualify for special Tax treatment, has in all material respects met the requirements for such treatment, and (C) if intended to be funded and/or book-reserved, is fully funded
and/or book-reserved, as appropriate, based upon reasonable actuarial assumptions, except as, individually or in the aggregate, would not reasonably be expected to result in material liability to the Company or any of its Subsidiaries.
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(c) With respect to each Pension Plan, (i) no proceeding has been initiated by the Pension
Benefit Guarantee Corporation (the “PBGC”) or the Company to terminate such plan; (ii) there has been no “reportable event” (as such term is defined in Section 4043(b) of ERISA); (iii) no unsatisfied
liability (other than for premiums to the PBGC not yet due) under Title IV or Section 302 of ERISA has been, or is expected to be, incurred by the Company or any of its ERISA Affiliates; (iv) each required installment or any other payment
required under Section 412 of the Code or Section 303 of ERISA has been made before the applicable due date; (v) as of the last day of the most recent plan year ended prior to the date hereof, the actuarially determined present value
of such plan’s benefit liabilities under Section 4001(a)(16) of ERISA did not exceed the then current value of such plan’s assets, or, if such liabilities did exceed such assets, the amount thereof was properly reflected on the
consolidated financial statements of the Company and its Subsidiaries; (vi) no plan has been required to file information pursuant to Section 4010 of ERISA for the current or most recently completed year; (vii) no plan has applied for
or received a waiver of the minimum funding standards or an extension of any amortization period within the meaning of Section 412 of the Code or Sections 302 or 303 of ERISA and (viii) there are no funding-based limitations (within the
meaning of Section 436 of the Code) currently in effect. Neither the Company, any of its Subsidiaries, nor any of its current or former ERISA Affiliates has, at any time during the last six (6) years, contributed to or been obligated to
contribute to any “multiemployer plan,” as defined in Section 3(37) of ERISA, a multiple employer plan subject to Section 4063 or 4064 of ERISA, or a multiple employer welfare benefit arrangement (as defined in
Section 3(40(A) of ERISA). None of the Company or any ERISA Affiliate has terminated an employee benefit plan for which the Company could reasonably be expected to have any existing or continuing liability. The Company has at all times reserved
the right and power to terminate, suspend, discontinue and amend all Company Plans including the Remy International, Inc. Salaried Retirement Plan (other than for benefits accrued prior thereto) in accordance with the procedures specified in each
such plan.
(d) Neither the Company nor any of its Subsidiaries has any obligations for post-employment health or life benefits for any of
their respective retired, former or current employees, except as required by Law. Neither the Company nor any of its Subsidiaries has any obligation to provide welfare benefits to any Person who is not a current or former director, officer or
employee of the Company or any of its Subsidiaries, or a beneficiary thereof.
(e) Neither the Company nor any of its ERISA Affiliates has
any material liability of any kind whatsoever, whether known or unknown, direct, indirect, contingent or otherwise, on account of any violation of the health care requirements of Part 6 of Subtitle B of Title I of ERISA or
Section 4980B of the Code.
(f) The Merger and the other transactions contemplated hereby will not, either alone or together with any
other event, (i) entitle any current or former employee, director, or independent contractor of the Company or any of its Subsidiaries to severance pay, (ii) accelerate the time of payment or vesting, or trigger any payment or funding
(whether through a grantor trust or otherwise) of compensation or benefits under, or increase the amount allocable or payable or trigger any other material obligation pursuant to, any Company Plan or (iii) result in
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the payment of any amount that would, individually or in combination with any other such payment, constitute an “excess parachute payment” as defined in Section 280G(b)(1) of the
Code.
(g) Neither the Company nor any Subsidiary has any obligation to provide, and no Company Plan or other Contract, plan or
arrangement (written or otherwise) provides any Person with the right to receive any additional payment as a result of the imposition of any excise tax under Section 4999 of the Code or interest or penalties incurred under Section 409A of
the Code.
(h) Except (i) as set forth on Section 3.11(h) of the Company Disclosure Letter and (ii) with respect to
statutory programs mandated by applicable Law, neither the Company nor any Subsidiary has been a party to, a sponsoring employer of, or otherwise is under any liability or obligation with respect to any defined benefit pension scheme, final salary
scheme or any death, disability or retirement benefit calculated by reference to age, salary or length of service or any of them, for employees working outside of the United States. To the knowledge of the Company, no employee of the Company or any
Subsidiary has any claim or right in respect of any benefit payable on early retirement or redundancy under an occupational pension scheme which has transferred to the Company or any Subsidiary by operation of the UK Transfer of Undertakings
(Protection of Employment) Regulations 1981 or 2006 (as amended) or any equivalent Laws in any jurisdiction which has implemented the Acquired Rights Directive 2001 or provides for the automatic transfer of employees’ employment.
Section 3.12 Labor Matters.
(a) Neither the Company nor any of its Subsidiaries is a party to, or is bound by, any collective bargaining agreement with any labor union,
labor organization or works council, or any other agreement regarding the rates of pay or working conditions of any employees, and has not been a party to or bound by any such agreement, or otherwise bound by any obligation to bargain with or
recognize any such labor union, labor organization or works council within the last three (3) years. Since January 1, 2013, there has been no labor dispute, strike, picketing, work stoppage or lockout, organizational activity, or, to the
knowledge of the Company, threat thereof, by or with respect to any employees of the Company or any of its Subsidiaries, whether engaged in collective action or not, except as, individually or in the aggregate, has not had or would not reasonably be
expected to have a Material Adverse Effect. Except as, individually or in the aggregate, had not had and would not reasonably be expected to have a Material Adverse Effect, the Company and each of its Subsidiaries has complied with all applicable
legal, administrative and regulatory requirements relating to wages, hours, immigration, discrimination in employment and collective bargaining, as well as the Workers Adjustment and Retraining Notification Act and comparable state, local and
federal Laws, whether domestic or international (“WARN”), and all other state, local and federal laws pertaining to employment and labor, and are not liable for any arrears of wages or any taxes or penalties for failure to comply
with any of the foregoing. Furthermore, there are no Actions or charges, grievances, complaints or investigations pending or, to the knowledge of the Company, threatened by or on behalf of any employee or group of employees of the Company or any of
its Subsidiaries, including any complaints alleging violations of state or federal Laws pertaining to employment and labor, whether domestic or international, including wage and hour, immigration, discrimination in employment, safety, Office of
Federal Contract Compliance, Occupational Safety and Health
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Administration, Department of Labor, Fair Labor Standards, and federal WARN or its related state or international laws or regulations that, individually or in the aggregate, has had or would
reasonably be expected to have a Material Adverse Effect. Without limiting the generality of the foregoing, each employee of the Company or any Subsidiary of the Company who works in the United States is, to the knowledge of the Company, duly
authorized to work in the United States, each employee of the Company or any Subsidiary of the Company who works outside the United States is, to the knowledge of the Company, duly authorized to work in the jurisdiction in which they are located and
the Company and its Subsidiaries have complied with applicable Laws concerning each such current and former employee’s employment eligibility verification, including with respect to Forms I-9, except as, individually or in the aggregate, has
not had and would not reasonably be expected to have a Material Adverse Effect.
(b) All independent contractors and consultants of the
Company and its Subsidiaries have been properly classified as such and may not be deemed employees of the Company or any of its Subsidiaries for any purpose, except as, individually or in the aggregate, has not had and would not reasonably be
expected to have a Material Adverse Effect.
Section 3.13 Environmental Matters.
(a) Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Material Adverse Effect:
(i) the Company and each of its Subsidiaries are, and at all times since January 1, 2010 have been, in compliance with all applicable Environmental Laws, and possess and are in compliance with all Environmental Permits (as defined in
Section 3.13(b)(ii) hereof) necessary for their operations; (ii) to the knowledge of the Company, there are no Materials of Environmental Concern (as defined in Section 3.13(b)(iii) hereof) at, on, in or under or
emanating from any property owned or operated by the Company or any of its Subsidiaries, except under circumstances that are not reasonably likely to result in liability of, or require remediation by, the Company or any of its Subsidiaries under any
applicable Environmental Laws; (iii) neither the Company nor any of its Subsidiaries has received any written notification alleging that it is liable for, or has received a request for information pursuant to Environmental Laws regarding its
potential liability in connection with, any release or threatened release of, or the exposure of any Person to, Materials of Environmental Concern at any location or in respect of any Company product; and (iv) neither the Company nor any of its
Subsidiaries has received any written claim or complaint, or is currently subject to any proceeding, relating to noncompliance with Environmental Laws or any other liabilities pursuant to Environmental Laws, and to the knowledge of the Company, no
such matter has been threatened in writing and, to the knowledge of the Company as of the date of this Agreement, there are no facts or conditions that would reasonably be expected to give rise to such claim or complaint.
(b) For purposes of this Agreement, the following terms shall have the meanings assigned below:
(i) “Environmental Laws” means all foreign, federal, state or local statutes, directives, regulations,
ordinances, treaties, codes or decrees protecting the quality of the ambient air, soil, surface water or groundwater, or indoor air, or regulating or imposing standards of care in respect of the use, handling, release and disposal of, or exposure of
Persons to, Materials of Environmental Concern, as such are in effect as of the date of this Agreement and any common law related to such;
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(ii) “Environmental Permits” means all permits, licenses,
registrations, approvals and other authorizations required under applicable Environmental Laws; and
(iii)
“Materials of Environmental Concern” means any pollutant, contaminant, hazardous, acutely hazardous, or toxic substance or waste, dangerous good, radioactive material, petroleum (including crude oil, any fraction thereof and refined
petroleum products), asbestos and asbestos-containing materials, polychlorinated biphenyls, or any other chemical, material or substance, whether man-made or naturally occurring, which is defined in, regulated under or for which liability is imposed
under any Law or common law related to pollution or protection of human health or the environment.
Section 3.14 Taxes.
(a) All Tax Returns required to be filed by or on behalf of the Company or any of its Subsidiaries have been timely filed in accordance with
all applicable Laws (taking into account extensions after giving effect to extensions properly obtained), all such Tax Returns are true, correct and complete in all material respects and disclose all Taxes required to be paid by the Company and each
of its Subsidiaries for the periods covered thereby, and all Taxes shown to be due on such Tax Returns have been timely paid.
(b) No
Liens for Taxes exist with respect to any assets or properties of the Company or any of its Subsidiaries other than liens for Taxes not yet due and payable.
(c) All Taxes that the Company or any of its Subsidiaries are required by Law to withhold or collection for payment have been duly withheld
and collected, and have been paid to the appropriate Governmental Entity.
(d) Neither the Company nor any of its Subsidiaries has any
potential liability for Taxes of any other Person pursuant to Treasury Regulation §1.1502-6 (or any similar provision of state, local or foreign law), pursuant to any Tax allocation, Tax sharing or Tax indemnity agreement, as a transferee or
successor or by Contract.
(e) There is no Action pending or threatened in writing against or with respect to the Company or any of its
Subsidiaries with respect to any Taxes, and all deficiencies asserted or assessments made as a result of any such Action have been paid in full or otherwise finally resolved.
(f) Neither the Company nor any of its Subsidiaries has waived or extended, or agreed to waive or extend, any statute of limitations in
respect of Taxes.
(g) Neither the Company nor any of its Subsidiaries will be required to include any amount in taxable income, or
exclude any item of deduction or loss in computing taxable income, for any period (or portion thereof) after the Closing Date as a result of any change in method of accounting for any period beginning before the Closing Date, “closing
agreement” as described in Section 7121 of the Code (or any corresponding or similar provision of state, local
23
or foreign Tax Law) entered into on or prior to the Closing Date, deferred intercompany gain or excess loss account described in Treasury Regulations under Section 1502 of the Code (or any
corresponding or similar provision of state, local or foreign Tax Law) as a result of any transaction occurring on or before the Closing Date, installment sale or open transaction disposition made on or prior to the Closing Date, prepaid amount
received on or prior to the Closing Date or amounts deferred under Section 108(i) of the Code (or any corresponding or similar provision of state, local or foreign Tax Law).
(h) Neither the Company nor any of its Subsidiaries has been a member of any group of corporations filing Tax Returns on a consolidated,
combined, unitary or similar basis other than each such group of which the Company is the common parent, or the group of which Distributing was the common parent.
(i) Neither the Company nor any of its Subsidiaries has participated in any “listed transaction” within the meaning of Treasury
Regulation § 1.6011-4(b)(2) and, with respect to each transaction in which the Company or any of its Subsidiaries has participated that is a “reportable transaction” within the meaning of Treasury Regulation
§ 1.6011-4(b)(1), such participation has been properly disclosed on IRS Form 8886 (Reportable Transaction Disclosure Statement) and on any corresponding form required under state, local or other law.
(j) None of the Company or any of its Affiliates has taken or failed to take any action that would reasonably be expected to adversely affect
the tax-free status of the contribution by Distributing on December 31, 2014 of all of the stock it owned of Remy Holdings, Inc. (“Old Controlled”) and certain other assets to New Remy Corp. (“Controlled”),
followed by the distribution of all of the outstanding capital stock of Controlled (together, the “Spin-Off”), or the tax-free status of the merger of New Remy Merger Sub, Inc. (“New Merger Sub”) and Controlled
pursuant to the Agreement and Plan of Merger, dated as of September 7, 2014 by and among the Company, Controlled, Old Controlled, New Merger Sub, Old Merger Sub, Inc. (“Old Merger Sub”), and Distributing, or the tax-free status
of the exchange of Old Controlled common stock pursuant to the merger of Old Controlled and Old Merger Sub.
(k) Except as described in
the preceding representation, since January 1, 2010, neither the Company nor any of its Subsidiaries has been a “distributing corporation” or a “controlled corporation,” or has otherwise participated, in a transaction
intended to qualify under Section 355 of the Code, other than the Spin-Off.
(l) As used in this Agreement:
(i) “Tax” (and, with correlative meaning, “Taxes”) means: any federal, state, local or
foreign net income, gross income, gross receipts, windfall profit, severance, property, production, sales, use, license, excise, franchise, employment, payroll, withholding on amounts paid to or by any Person, alternative or add-on minimum,
ad valorem, value-added, transfer, stamp, or environmental tax (including taxes under Code Section 59A), or any other tax, custom, duty, 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 Entity.
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(ii) “Tax Return” means any return, report or similar statement
required to be filed with respect to any Tax (including any attached schedules), including any information return, claim for refund, amended return or declaration of estimated Tax.
Section 3.15 Contracts.
(a) Except for this Agreement and except for Contracts filed or furnished as exhibits to, or incorporated by reference into, the Publicly
Available Company SEC Documents, Section 3.15(a) of the Company Disclosure Letter sets forth a true and complete list of each of the following Contracts to which the Company or any of its Subsidiaries is a party (and any amendments, supplements
and modifications thereto) as of the date of this Agreement:
(i) any Contract that would be required to be filed by the
Company as a “material contract” pursuant to Item 601(b)(10) of Regulation S-K under the Securities Act;
(ii) any Contract (A) that purports to limit in any material respect either the type or scope of business in which the
Company or any of the Subsidiaries of the Company (or, after the Effective Time, Parent or any of its Subsidiaries) may engage or the geographic area in which any of them may so engage in any business (including through provisions regarding
non-competition or exclusivity), (B) in which an Acquired Company grants “most favored nation” or similar status to any of its customers that, following the Effective Time, would by its terms require Parent or its Subsidiaries (other
than the Acquired Companies) to apply such status to their own customers, (C) that is a “take-or-pay” Contract requiring an Acquired Company to purchase a minimum amount of any product or service from the counterparty to such Contract
or pay a financial penalty or (D) that provides for the Acquired Company to dispose of any material assets or line of business of the Acquired Companies (other than to the extent excluded in the exception set forth in clause (x) below and
other than inventory in the ordinary course or business);
(iii) any (A) indenture, loan or credit agreement, loan
note, mortgage agreement, letter of credit or other Contract representing, or any guarantee of, indebtedness for borrowed money of an Acquired Company (other than indebtedness for borrowed money (i) in the form of trade credit or similar loans
or advances entered into in the ordinary course of business or (ii) with an aggregate outstanding principal amount not in excess of $5,000,000 in the aggregate) (except for such indebtedness between Acquired Companies or guarantees by any
Acquired Company of indebtedness of any Acquired Company), (B) Contract in respect of swaps, hedges or similar arrangements (other than any Contracts in respect of swaps, hedges or similar arrangements entered into pursuant to International
Swaps and Derivatives Association Master Agreements in the ordinary course of business consistent with the Company’s hedging policy made available to Parent), or (C) factoring agreement or other Contract providing for the factoring of
Acquired Company receivables (1) which, in either case, does not provide for non-recourse treatment of the receivables factored or (2) pursuant to which the Acquired Companies have sold in fiscal year 2014 (or have or expect to sell in
fiscal year 2015) Acquired Company receivables for amounts in excess of $5,000,000;
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(iv) any Contract establishing any material (A) joint venture or
partnership, or (B) strategic alliance with a third party for the joint development or marketing of products;
(v) any
customer or supplier Contract (including any customer Contract that is a distribution Contract) under which the Company or any of its Subsidiaries (A) made or received payments of more than $10,000,000 during the fiscal year ended
December 31, 2014 or (B) reasonably expects to make or receive payments of more than $10,000,000 for the fiscal year ending December 31, 2015 and, in the case of either of clause (A) or clause (B), is not terminable upon notice
of ninety (90) days or less without penalty;
(vi) any Contract that involves the licensing to a third party of
Company Intellectual Property or the licensing by the Company of Intellectual Property owned by a third party, in each case, that is material to the business of the Company or any of its Subsidiaries, taken as a whole, and in each case, other than
such licenses that are granted pursuant to commercial relationships between the Company and its customers, vendors or suppliers in the ordinary course of business or any such licenses for software that is generally commercially available;
(vii) any Contract containing any standstill or similar restriction pursuant to which the Company or its Subsidiaries has
agreed not to acquire securities of another Person or to refrain from engaging in or proposing to engage in business combination transactions with another Person;
(viii) any employment Contract that requires aggregate payments with respect to annual salary and target bonus in excess of
$200,000 on an annual basis or is not terminable without cause by the Company or any of its Subsidiaries by notice of not more than sixty (60) days or without any termination payment or penalty, or any severance, retention, change in control or
similar Contract;
(ix) any collective bargaining agreement or other Contract with any labor organization, union or
association or works council;
(x) any Contract that grants any rights of first refusal, rights of first negotiation or
other similar pre-emptive rights to any person (other than an Acquired Company) with respect to any asset that is material to the Company and its Subsidiaries, taken as a whole, excluding any Contract with a customer of the Company or any Subsidiary
of the Company which, by its terms, permits the customer under such Contract, in connection with the termination of such Contract, to purchase assets of the Company or its Subsidiaries under such Contract that are exclusively used by the Company and
its Subsidiaries to manufacture products for such customer;
(xi) any Contract entered into in connection with the
acquisition or disposition by the Acquired Companies of any business or business unit (by merger, sale of stock, sale of assets or otherwise) (other than acquisitions and dispositions of assets in the ordinary course of business) (A) that
contains “earnout” or other contingent payment obligations (other than any such obligations (1) that are indemnification obligations or (2)
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that provide for potential payments of less than $2,000,000) or (B) under which any Acquired Company has any continuing indemnification obligations that would reasonably be expected to give
rise to a liability that is material to the Acquired Companies, taken as a whole;
(xii) any (A) Government Contract;
(B) settlement or similar Contract entered into since January 1, 2013 that is, in the case of either of clause (A) or clause (B), material to the Acquired Companies, taken as a whole or (C) material Contract entered into with
Motors Liquidation Company (f/k/a General Motors Corp.) or any of its Affiliates (or any seller or buyer of any of the businesses of the foregoing pursuant to the reorganization of Motors Liquidation Company f/k/a General Motors Corp.) in connection
with the reorganization of Motors Liquidation Company (f/k/a General Motors Corp.);
(xiii) any material Contract entered
into in connection with the consummation of the Spin-Off and the related transactions conducted on December 31, 2014;
(xiv) any Contract purporting to indemnify or hold harmless any director or officer of the Company (other than the Company
Constituent Documents or organizational documents of the Company’s Subsidiaries); and
(xv) any Contract that is
between the Company or one of its Subsidiaries on the one hand and any Person beneficially owning five percent (5%) or more of the outstanding Shares on the other hand.
Each such Contract required to be listed in Section 3.15(a) or Section 3.17(b) of the Company Disclosure Letter (or that would have
been required to be listed in Section 3.15(a) but for the fact that it is furnished or filed with a Publicly Available Company SEC Document), a “Material Contract”.
(b) True and complete copies of all Material Contracts of the Company and its Subsidiaries have been made available to Parent. For purposes of
this Agreement, “Contract” means any note, bond, mortgage, indenture, contract, arrangement, undertaking, agreement, lease or other instrument or obligation, together with all amendments thereto, but excludes any Company Plan and
any purchase order entered into the ordinary course of business. Each Material Contract is a legally valid and binding obligation of each of the Acquired Companies that are party thereto and, to the knowledge of the Company, any other party thereto,
and is in full force and effect, except in each case for such failures to be a legally valid and binding obligation or to be in full force and effect that, individually or in the aggregate, would not reasonably be expected to have a Material Adverse
Effect. Except as, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect (i) there is no default under any Material Contract by the Company or any of its Subsidiaries party thereto or, to the
knowledge of the Company, any other party thereto and (ii) no event has occurred that with the lapse of time or the giving of notice or both would constitute a default thereunder by the Company or any of its Subsidiaries party thereto or, to
the knowledge of the Company, any other party thereto.
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(c) As of the date of this Agreement, except as, individually or in the aggregate, has not had
and would not reasonably be expected to have a Material Adverse Effect: (x) to the Company’s knowledge, neither the Company nor any of its Subsidiaries nor any of their respective personnel is subject to an ongoing administrative, civil,
or criminal investigation, indictment or audit by any Governmental Entity with respect to any alleged irregularity, misstatement or omission arising under or relating to any Government Contract; (y) to the Company’s knowledge, neither the
Company nor any of its Subsidiaries has since January 1, 2013 conducted or initiated any internal investigation or made a voluntary disclosure to any Governmental Entity with respect to any alleged irregularity, misstatement or omission arising
under a Government Contract; and (z) neither the Company nor any of its Subsidiaries nor, to the Company’s knowledge, any of their respective personnel has been suspended or debarred from doing business with any Governmental Entity or is,
or at any time has been, the subject of a finding of non-responsibility or ineligibility (due to misconduct) by any Governmental Entity contracting with the Acquired Companies.
Section 3.16 Insurance. Except as has not had and would not, individually or in the aggregate, reasonably be expected to have a
Material Adverse Effect: (a) the Company and its Subsidiaries have since January 1, 2013 maintained insurance with reputable insurers in such amounts and against such risks as are in accord with normal industry practice; (b) all
insurance policies owned or held by the Company or any of its Subsidiaries, or pursuant to which the Company or any of its Subsidiaries is a named insured, as of or after the date of this Agreement are in full force and effect, and all premiums due
on such policies have been paid by the Company or its Subsidiaries (other than retroactive or retrospective premium adjustments that are not yet, but may be, required to be paid with respect to any period ending before the Closing Date);
(c) neither the Company nor any of its Subsidiaries is in breach or default under such policies, which breach or default would permit cancellation, termination or modification of any such insurance policies, and neither the Company nor any of
its Subsidiaries has taken any action which, or failed to take any action where such failure would, with or without notice, lapse of time or both, would constitute such a breach or default; and (d) none of the Company and its Subsidiaries has
received any written notice of cancellation or termination with respect to any material insurance policy of the Company or its Subsidiaries in effect on the date of this Agreement.
Section 3.17 Properties.
(a) Section 3.17(a) of the Company Disclosure Letter sets forth a list that is true and complete of all real property owned by the Company
or any of its Subsidiaries (the “Owned Real Property”). Except as, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect, the Company or one of its Subsidiaries has marketable fee (or
similar) title to the Owned Real Property, subject only to Permitted Liens. Except as, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect, neither the Company nor any of its Subsidiaries owns, holds,
has granted, or is obligated under, any option, right of first offer, right of first refusal or other similar contractual right to sell or dispose of any of the Owned Real Property or any portion thereof or interest therein.
For the purpose of this Agreement, “Permitted Liens” shall mean (i) statutory Liens for Taxes, special assessments or
other governmental or quasi-governmental charges not
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yet due and payable or which may hereafter be paid without penalty or the amount or validity of which is being contested in good faith by appropriate proceedings, in each case for which
sufficient reserves have been established in the financial statements and books and records of the Company in accordance with GAAP (where required by GAAP), (ii) landlords’, warehousemens’, mechanics’, materialmens’,
repairmans’, carriers’ or similar Liens that relate to obligations not due and payable and arise in the ordinary course of business, (iii) regulations promulgated by Governmental Entities (including with respect to zoning, building,
entitlement and other land use), (iv) the interests of the lessors and sublessors of any leased properties, (v) easements, rights of way and other imperfections of title or encumbrances that do not materially interfere with the present use
of, or materially detract from the value of, the property related thereto and (vi) Liens incurred in the ordinary course of business since December 31, 2014 that are not, individually or in the aggregate, material to the Company and its
Subsidiaries, taken as a whole.
(b) Section 3.17(b) of the Company Disclosure Letter sets forth a true and complete list of all
leases or subleases to which an Acquired Company is a party as of the date hereof, under which any Acquired Company uses or occupies or has the right to use or occupy any material real property (the “Real Property Leases”). The
Company has made available to Parent true, correct and complete copies of the Real Property Leases. Except as, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect, (i) each Real Property Lease is
a valid and binding obligation of the Acquired Companies Party thereto and, to the knowledge of the Company, of each other party thereto and is in full force and effect, (ii) all rent and other sums and charges payable by any Acquired Company
as tenants thereunder are current in all material respects, and (iii) no termination event or condition or uncured default of a material nature on the part of any Acquired Company or, to the knowledge of the Company, the landlord thereunder
exists under any Real Property Lease. Except as, individually or in the aggregate, would not reasonably be expected to have a Material Adverse Effect, each Acquired Company has a good and valid leasehold interest in each parcel of material real
property leased by it, subject only to Permitted Liens.
Section 3.18 Intellectual Property.
(a) Section 3.18(a) of the Company Disclosure Letter contains a list of all issued Patents and pending applications for Patents,
registered Trademarks and pending applications to register Trademarks, Domain Names, and registered Copyrights and applications to register Copyrights, in each case included in the Owned Intellectual Property as of the date of this Agreement.
(b) Except as expressly stated in Section 3.18(b) of the Company Disclosure Letter, the Company or one of its Subsidiaries: (A) owns
all right, title and interest in the Owned Intellectual Property, free and clear of any Liens other than non-exclusive licenses and other Liens granted in the ordinary course of business and (B) has the sole and exclusive right to bring actions
for infringement or unauthorized use of the Owned Intellectual Property. Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Material Adverse Effect, the Owned Intellectual Property and the rights
in Intellectual Property under the licenses to use Intellectual Property owned by third parties identified in Section 3.15(a)(vi) of the Company Disclosure Letter, together with such licenses that are granted
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pursuant to commercial relationships between the Company and its customers, vendors or suppliers in the ordinary course of business or any such licenses for software that is generally
commercially available, are all those material Intellectual Property rights necessary to conduct the business of the Company and its Subsidiaries as presently conducted.
(c) Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Material Adverse Effect or except
as otherwise expressly stated in Section 3.18(c) of the Company Disclosure Letter: (i) the issued Patents, registered Trademarks and registered Copyrights included in the Owned Intellectual Property are valid and in force; and
(ii) the validity of and title to the Owned Intellectual Property (A) have not been questioned in any prior Action, (B) are not being questioned in any pending Action, and (C) are not the subject(s) of any threatened or proposed
Action.
(d) Except as, individually or in the aggregate, has not had and would not reasonably be expected to have a Material Adverse
Effect or except as otherwise expressly stated in Section 3.18(d) of the Company Disclosure Letter: (i) the business of the Company and its Subsidiaries, as presently conducted, does not infringe or misappropriate and, to the knowledge of
the Company has not been alleged to infringe or misappropriate any Intellectual Property of any third party; and (ii) to the knowledge of the Company there are no unauthorized third parties using any of the Owned Intellectual Property that is
material to such business as presently conducted.
(e) Except as, individually or in the aggregate, has not had and would not reasonably
be expected to have a Material Adverse Effect and except as expressly stated in Section 3.18(e) of the Company Disclosure Letter: (i) the Company and its Subsidiaries has used commercially reasonable efforts to protect the confidentiality
of their Trade Secrets included in the Owned Intellectual Property; (ii) the Company and its Subsidiaries have entered into agreements obligating their employees, consultants, officers, directors and agents to maintain the confidentiality of
the Trade Secrets included in the Owned Intellectual Property; and (iii) to the knowledge of the Company, there has been no unauthorized disclosure or use of the Trade Secrets included in the Owned Intellectual Property.
Section 3.19 Customers and Suppliers. Section 3.19 of the Company Disclosure Letter sets forth (x) a true, complete and
correct list of the ten (10) largest (measured by revenue) original equipment manufacturer customers (each a “Material OEM Customer”), the ten (10) largest (measured by revenue) aftermarket customers (each a
“Material Aftermarket Customer”) and the ten (10) largest (measured by gross expenditures) suppliers (each a “Material Supplier”) to the Acquired Companies for the fiscal year ended December 31, 2014 and
(y) in all material respects the total dollar number of sales to, or purchases from, as the case may be, each Material OEM Customer, Material Aftermarket Customer or Material Supplier during such period. Since January 1, 2014 through the
date of this Agreement, (i) no Material OEM Customer, Material Aftermarket Customer or Material Supplier has, to the knowledge of the Company, notified the Company or any of its Subsidiaries that it intends to terminate, cancel or (other than
in connection with industry-wide decreases in volume) materially curtail its business relationship with the Acquired Companies and (ii) neither the Company nor any of its Subsidiaries is engaged in a dispute that is material to the Company and
its Subsidiaries, taken as a whole, with a Material OEM Customer, Material Aftermarket Customer or Material Supplier, that remains ongoing.
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Section 3.20 Affiliate Transactions. Other than rights to receive Per Share Merger
Consideration and the consideration provided for under Section 2.1 with respect to Company Equity Awards, no material relationship, direct or indirect, exists between the Company or any Subsidiary of the Company, on the one hand, and any
officer, director or other Affiliate (other than any Subsidiary of the Company) of the Company, on the other hand, that is required to be described under Item 404 of Regulation S-K under the Securities Act in the Company SEC Documents, which is
not described in Company SEC Documents.
Section 3.21 Hedging. The Company’s and its Subsidiaries’ outstanding
hedging and derivatives Contracts as of the date of this Agreement were entered into in compliance in all material respects with the Acquired Company hedging policy made available to Parent.
Section 3.22 Quality and Safety of Products.
(a) Since January 1, 2013, neither the Company nor any of its Subsidiaries has received written notice from (i) any of its customers
that such customer has (A) received any written notice or allegation from a Governmental Entity, (B) been a party or subject to any action, suit, investigation or proceeding brought or initiated by a Governmental Entity or (C) been
threatened in writing by a Governmental Entity with any action, suit, investigation or proceeding or (ii) a Governmental Entity that contained allegations or threatened or stated a basis for initiating an action, suit, investigation or
proceeding, in each of the foregoing clauses (i) and (ii), with respect to the failure or alleged failure of any product produced, sold or distributed by or on behalf of the Company or any of its Subsidiaries to meet applicable
manufacturing, quality or labeling standards established by Law, except, in the case of each of clause (i) and (ii), as, individually or in the aggregate, has not had and would not reasonably be expected to have a Material
Adverse Effect.
(b) Since January 1, 2013, (i) there have been no recalls of any product of the Company or any Subsidiary
whether ordered by a Governmental Entity or undertaken voluntarily by the Company or any Subsidiary and (ii) the Company has not received any written notice from any customer or Governmental Entity in connection with a claim or allegation
against the Company or its Subsidiaries, in each case related to any such recall, except in each of the foregoing clauses (i) and (ii) for any such recalls that, individually or in the aggregate, have not had and would not
reasonably be expected to have a Material Adverse Effect.
Section 3.23 Tax Matters Agreement. The Company has delivered to
Distributing, pursuant to Section 5.1 of the Tax Matters Agreement dated as of December 31, 2014, among Distributing, Controlled and the Company (the “Tax Matters Agreement”), an opinion of its counsel, Sullivan &
Cromwell LLP, to the effect that, on the basis of facts, representations and assumptions set forth in such opinion, the completion of the Merger should not affect the tax-free status of the Spin-Off (the “Tax Opinion”). As of the
date of this Agreement, the Company has delivered to Parent a true and complete copy of the Tax Opinion and written confirmation by Distributing that such Tax Opinion delivered by the Company pursuant to Section 5.1 of the Tax Matters Agreement
is reasonably satisfactory to Distributing. The Tax Opinion has not been withdrawn or revoked, or amended, modified or supplemented, in any respect.
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Section 3.24 Brokers. Except for UBS Securities LLC (the fees and expenses of which
will be paid by the Company), no broker, investment banker, financial advisor or other Person is entitled to any broker’s, finder’s, financial advisor’s or other similar fee or commission in connection with the transactions
contemplated by this Agreement based on arrangements made by or on behalf of the Company.
Section 3.25 Takeover Statutes.
Other than Section 203 of the DGCL, no Takeover Laws or any anti-takeover provision in the Company Constituent Documents is applicable to the Merger or this Agreement or the Voting Agreement. Assuming the accuracy of the representations and
warranties of Parent and Merger Sub set forth in Section 4.10, the Company Board has taken all necessary action such that the restrictions imposed on business combinations by Section 203 of the DGCL are inapplicable to this
Agreement.
For purposes of this Agreement, “Takeover Laws” shall mean any “Moratorium,” “Control Share
Acquisition,” “Fair Price,” “Business Combination,” or other similar state anti-takeover Laws and regulations.
Section 3.26 Fairness Opinion. The Company Board has received the opinion of UBS Securities LLC, financial advisor to the Company,
to the effect that, as of the date of such opinion and subject to the assumptions, limitations and qualifications reflected therein, the Per Share Merger Consideration to be received by holders of Shares (other than Excluded Shares and Dissenting
Shares) in the Merger is fair, from a financial point of view, to such holders. As of the date of this Agreement, such opinion has not been rescinded, repudiated or, except as set forth therein, qualified. It is agreed and understood that such
opinion may not be relied on by Parent or Merger Sub.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF
PARENT AND MERGER SUB
Parent and Merger Sub jointly and severally represent and warrant to the Company as follows:
Section 4.1 Organization, Standing and Power.
(a) Each of Parent and Merger Sub (i) is a corporation duly formed, validly existing and in good standing under the Laws of the State of
Delaware, (ii) has all requisite corporate power and authority to own, lease and operate its properties and assets and to carry on its business as now being conducted, and (iii) is duly qualified or licensed to do business and is in good
standing in each jurisdiction in which the nature of its business or the ownership, leasing or operation of its properties makes such qualification or licensing necessary, except for any such failures that individually or in the aggregate, would not
reasonably be expected to prevent, materially delay, or impair the consummation of the Merger or the other transactions contemplated hereby.
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(b) Parent has made available to the Company true, correct and complete copies of the certificate
of incorporation and bylaws of each of Parent and Merger Sub as of the date hereof, including all amendments thereto, and each as so delivered is in full force and effect as of the date hereof. Neither Parent nor Merger Sub is in violation of any
provision of its certificate of incorporation or bylaws.
Section 4.2 Authority. Each of Parent and Merger Sub has all
necessary corporate power and authority to execute and deliver this Agreement, to perform its obligations hereunder, and to consummate the transactions contemplated hereby. The execution, delivery and performance of this Agreement by Parent and
Merger Sub and the consummation by Parent and Merger Sub of the transactions contemplated hereby have been duly authorized by the boards of directors of each of Parent and Merger Sub, and no other corporate proceedings on the part of Parent or
Merger Sub are necessary to approve this Agreement, or to consummate the transactions contemplated hereby, subject, in the case of the consummation of the Merger, to the filing of the Certificate of Merger with the Secretary of State of the State of
Delaware as required by the DGCL. This Agreement has been duly executed and delivered by each of Parent and Merger Sub and assuming the due authorization and the valid execution and delivery by the Company, constitutes a legal, valid and binding
obligation of Parent and Merger Sub, enforceable against each of them in accordance with its terms (except to the extent that enforceability may be limited by applicable bankruptcy, insolvency, fraudulent transfer, moratorium, reorganization or
similar Laws relating to or affecting creditors’ rights generally or by general principles of equity).
Section 4.3 No
Conflict; Consents and Approvals.
(a) The execution, delivery and performance of this Agreement by Parent and Merger Sub do not, and
the consummation by Parent and Merger Sub of the Merger and the other transactions contemplated hereby, will not (i) conflict with or violate the certificate of incorporation or bylaws of Parent or Merger Sub, (ii) assuming that all
consents, approvals and authorizations contemplated by clauses (i) through (iv) of subsection (b) below have been obtained and all notices and filings described in such clauses have been made, violate any
Law or any settlement, injunction or award of any Governmental Entity, in each case applicable to Parent or Merger Sub, or (iii) result in any breach or violation of, constitute a default (or an event which with notice or lapse of time or both
would become a default) under, result in a right of payment or loss of benefit under, give rise to any right of termination, cancellation or acceleration of, or result in the creation of any Lien upon any of the material properties or assets of
Parent or Merger Sub (including the Acquired Companies following the Effective Time) except in the case of clauses (ii) and (iii) above, as would not reasonably be expected to prevent, materially delay, or impair the
consummation of the Merger or the other transactions contemplated by this Agreement.
(b) The execution, delivery and performance of this
Agreement by Parent and Merger Sub, and the consummation by Parent and Merger Sub of the Merger and the other transactions contemplated hereby, do not require any consent, approval, order, authorization or permit of, action by, filing, registration
or declaration with or notification to, any Governmental Entity, except (i) as required under applicable requirements of the Exchange Act and the rules and regulations promulgated thereunder, and under state securities and “blue sky”
Laws, (ii) as
33
required under the HSR Act or any other applicable Antitrust Law, (iii) pursuant to the applicable requirements of the New York Stock Exchange, (iv) for the filing with the Secretary of
State of the State of Delaware of the Certificate of Merger as required by the DGCL and (v) as would not reasonably be expected to prevent, materially delay, or impair the consummation of the transactions contemplated by this Agreement.
Section 4.4 Information in the Proxy Statement. None of the information supplied by Parent or Merger Sub for inclusion or
incorporation by reference in the Proxy Statement (or any amendment thereof or supplement thereto) will, at the date mailed to stockholders of the Company or at the time of the Company Stockholders Meeting, contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or necessary in order to make the statements made therein, in light of the circumstances under which they are made, not misleading.
Section 4.5 Ownership and Operations of Merger Sub. Merger Sub has been formed solely for the purpose of engaging in the
transactions contemplated hereby and has not, and at no time prior to the Effective Time will have, engaged in any other business activities and does not, and at no time prior to the Effective Time will, have assets, liabilities or obligations of
any nature other than as contemplated herein or as otherwise required to effect the transactions contemplated by this Agreement. The authorized capital stock of Merger Sub consists solely of 2,000 shares of common stock, par value $0.01 per share,
all of which are validly issued and outstanding. All of the issued and outstanding capital stock of Merger Sub is, and at all times through the Effective Time will be, wholly-owned directly or indirectly by Parent, free and clear of all Liens.
Section 4.6 Litigation. As of the date of this Agreement, there are no Actions pending or, to the knowledge of the officers of
Parent, threatened against Parent or Merger Sub that seek to enjoin or restrain, or would reasonably be expected to have the effect of preventing, making illegal, or otherwise interfering with, any of the transactions contemplated by this Agreement,
except as, individually or in the aggregate, would not reasonably be expected to prevent, materially delay, or impair the ability of Parent and Merger Sub to consummate the Merger or the other transactions contemplated by this Agreement.
Section 4.7 Financing. Parent and Merger Sub have available to them (through a combination of cash on hand and committed
financing), and will have available to them, in cash, at the Effective Time and the Closing, all funds necessary (i) for the payment to the Paying Agent in cash of the aggregate Per Share Merger Consideration and (ii) to satisfy all of
their other obligations under this Agreement.
Section 4.8 Vote/Approval Required. No vote or consent of the holders of any
class or series of capital stock of Parent is necessary to approve this Agreement or the Merger or the other transactions contemplated hereby. The vote or consent of Parent, and/or one or more wholly-owned Subsidiaries of Parent, as the sole
stockholder(s) of Merger Sub (which shall occur on the date hereof promptly following the execution of this Agreement) is the only vote or consent of the holders of any class or series of capital stock of Merger Sub necessary to approve this
Agreement, the Merger and the other transactions contemplated hereby.
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Section 4.9 Brokers. No agent, broker, finder, investment banker, financial advisor
or other Person is entitled to any broker’s, finder’s, financial advisor’s or other fee or commission in connection with the Merger or any other transactions contemplated by this Agreement based upon arrangements made by or on behalf
of Parent or Merger Sub for which the Company will have any liability.
Section 4.10 Ownership of Shares. Other than as a
result of this Agreement, none of Parent, Merger Sub or any of their Affiliates is, or at any time during the last three (3) years has been, an “interested stockholder” (as defined in Section 203 of the DGCL) of the Company. None
of Parent, Merger Sub or any of their Affiliates owns, or has at any time during the last three (3) years owned, any Shares, other than Shares that represent, in the aggregate, no more than one percent (1%) of the outstanding Shares.
Section 4.11 Acknowledgment of No Other Representations or Warranties. In connection with the due diligence investigation of the
Company by Parent and Merger Sub, Parent and Merger Sub have received and may continue to receive from the Company certain estimates, projections, forecasts and other forward-looking information, as well as certain business plan and cost-related
plan information, regarding the Company, its Subsidiaries and their respective businesses and operations. Parent and Merger Sub hereby acknowledge that there are uncertainties inherent in attempting to make such estimates, projections, forecasts and
other forward-looking statements, that Parent and Merger Sub are taking full responsibility for making their own evaluation of the adequacy and accuracy of all estimates, projections, forecasts and other forward-looking information, as well as such
business plans and cost-related plans, so furnished to them (including the reasonableness of the assumptions underlying such estimates, projections, forecasts, forward-looking information, business plans or cost-related plans), and that neither the
Company nor any of its Subsidiaries, nor any of their respective stockholders, directors, officers, employees, Affiliates, advisors, agents or representatives, nor any other Person, has made or is making any representation or warranty with respect
to such estimates, projections, forecasts, forward-looking statements, business plans or cost-related plans (including the reasonableness of the assumptions underlying such estimates, projections, forecasts, forward-looking statements, business
plans or cost-related plans).
ARTICLE V
COVENANTS
Section 5.1 Conduct of Business of the Company.
(a) The Company covenants and agrees that, during the period from the date hereof until the Effective Time, except (i) as required or
specifically permitted by this Agreement, (ii) as required by applicable Law or a Governmental Entity with jurisdiction over the Company or a Subsidiary of the Company, (iii) as set forth in Section 5.1 of the Company Disclosure
Letter or (iv) if Parent otherwise provides its prior consent in writing (which such consent shall not be unreasonably withheld, conditioned or delayed), the Company shall, and shall cause each of its Subsidiaries to, conduct its business in
all material respects in the ordinary course of business consistent with past practice and, to the extent consistent with the foregoing, to use commercially reasonable efforts to (x) preserve substantially intact its business organization and
(y) maintain satisfactory relationships with its material customers, suppliers and distributors and other Persons with which it has material business relations.
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(b) Without limiting the generality of Section 5.1(a), between the date of this Agreement
and the Effective Time, except (i) as required or specifically permitted by this Agreement, (ii) as required by applicable Law or a Governmental Entity with jurisdiction over the Company or a Company Subsidiary, (iii) as set forth in
Section 5.1 of the Company Disclosure Letter or (iv) if Parent provides its prior consent in writing (which such consent shall not be unreasonably withheld, conditioned or delayed), the Company shall not, and shall cause its Subsidiaries
not to:
(i) amend or permit the adoption of any amendment to the charter or bylaws (or equivalent organizational
documents) of any Acquired Company;
(ii) adopt a plan of complete or partial liquidation, dissolution, merger,
consolidation, restructuring, recapitalization or other reorganization;
(iii) issue, grant, deliver, sell, pledge, dispose
of or encumber any (A) shares of capital stock of any Acquired Company, except the issuance of Shares pursuant to the exercise of Company Stock Options outstanding as of the date hereof and in accordance with the terms of such instruments,
(B) other voting securities of, or equity interests in, the Company or any capital stock or voting securities of, or other equity interests in, any Subsidiary of the Company, (C) securities convertible into or exercisable or exchangeable
for any shares of capital stock or voting securities of, or equity interests in, the Company or any of its Subsidiaries, (D) right to acquire any shares of capital stock or voting securities of, or other equity interests in, the Company or any
of its Subsidiaries, (E) Company Stock Equivalents or (F) Company Voting Debt (other than, in the case of each of clause (A) through clause (F), the issue, grant, delivery, sale, pledge, disposal of or encumbrance of any of the
foregoing by a wholly-owned Subsidiary of the Company in a transaction solely with one or more other wholly-owned Acquired Companies);
(iv) declare, make or pay any dividend or other distribution, payable in cash, stock, property or otherwise, with respect to
any of its capital stock or other equity interests (except for (i) any dividend or distribution by a Subsidiary of the Company to the Company or to other wholly owned Subsidiaries of the Company and (ii) regular quarterly dividends
declared and paid by the Company in an amount not in excess of $0.11 per Share per quarter at such times as are consistent with the Company’s historical practice over the twelve (12) months prior to the date of this Agreement);
(v) enter into any interest rate, derivatives or hedging transaction (including with respect to commodities) other than in the
ordinary course of business in accordance with the Company hedging policy made available to Parent;
(vi) (A) adjust,
split, combine, redeem, repurchase or otherwise acquire any shares of its capital stock or other equity interests (except in connection with the cashless exercises or similar transactions (including withholding of Taxes) pursuant to the exercise of
Company Stock Options outstanding as of the date hereof), or (B) reclassify,
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combine, split, subdivide or otherwise amend the terms of its capital stock or other equity interests, or (C) enter into any agreement with respect to the voting of any of the Company’s
capital stock or other securities or the capital stock or other securities of a Subsidiary of the Company;
(vii) amend,
terminate or otherwise modify in a manner adverse to the Company or Parent the Support Agreement between the Company and H Partners Group, dated February 3, 2015 or the confidentiality agreement referred to therein (collectively, the
“Company Support Agreement”);
(viii) authorize, or make any binding commitment with respect to, any
capital expenditure, other than capital expenditures that (A) are set forth in the most recent version of the Company’s budget made available to Parent prior to the date of this Agreement or (B) additional capital expenditures not
described in clause (A) so long as the aggregate amount of such expenditures does not exceed $5,000,000 in the aggregate; provided, however that, the Company will be permitted to make capital expenditures that are reasonably
necessary in response to operational emergencies, equipment failures or outages so long as the aggregate amount of such expenditures made pursuant to this proviso do not exceed $5,000,000, which amounts shall not be aggregated with the amount set
forth in clause (B);
(ix) (A) acquire (whether by merger, consolidation or acquisition of stock or assets or otherwise)
any corporation, partnership or other business organization or division thereof or any material assets, other than (1) purchases of inventory and other assets in the ordinary course of business consistent with past practice, (2) pursuant
to Contracts in effect on the date hereof and disclosed in the Company Disclosure Letter or filed or furnished as exhibits to Publicly Available Company SEC Documents, (3) pursuant to transactions solely among Acquired Companies, or
(4) (solely with respect to the acquisitions of assets) the making of capital expenditures permitted by Section 5.1(b)(viii), or (B) sell, lease, exchange, mortgage, pledge, transfer, subject to any Lien or otherwise dispose of
(whether by merger, consolidation or acquisition of stock or assets or otherwise) any corporation, partnership or other business organization or division thereof or any material assets, other than (1) sales, leases, exchanges or other
dispositions of inventory and other assets in the ordinary course of business consistent with past practice or (2) grants of Permitted Liens (3) pursuant to transactions solely among wholly-owned Acquired Companies or (4) pursuant to
Contracts in effect on the date hereof and disclosed in the Company Disclosure Letter or filed or furnished as exhibits to Publicly Available Company SEC Documents;
(x) enter into any material joint venture or partnership;
(xi) engage in any transactions, agreements, arrangements or understandings with any Affiliate or other Person that would be
required to be disclosed under Item 404 of Regulation S-K under the Securities Act;
(xii) make any loans, advances or
capital contributions to, or investments in, any other Person (other than another Acquired Company) in excess of $1,000,000 in the aggregate, other than trade credit and similar loans and advances made to Contract counterparties in the ordinary
course of business, consistent with past practice;
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(xiii) incur any additional indebtedness for borrowed money
other than (A) for additional indebtedness for borrowed money (in excess of amounts outstanding as of the date of this Agreement) in an aggregate amount outstanding at any time not in excess of $10,000,000 borrowed pursuant to (1) Credit
Agreements or (2) other arrangements not containing change of control provisions and not providing for prepayment penalties, (B) trade credit or similar loans or advances in the ordinary course of business (to the extent they would be
deemed to be indebtedness for borrowed money) or (C) amounts not in excess of $5 million in the aggregate (which may be in addition to the amounts permitted by clause (A)) not containing change of control provisions and not providing for
prepayment penalties in connection with actions taken pursuant to the proviso in Section 5.1(b)(viii);
(xiv)
assume, guarantee, endorse or otherwise become liable or responsible for the indebtedness for borrowed money of any Person other than any Acquired Company;
(xv) except to the extent required by applicable Law (including Section 409A of the Code), or the terms
of any Company Plan, and except as contemplated by Section 2.1(d) and Section 5.7, (A) increase the compensation or benefits of any current or former director, officer or employee whose annual base salary as of the date
hereof is in excess of $200,000, except, with respect to employees who are not officers, increases in annual salary or wage rate in the ordinary course of business consistent with past practice that do not exceed five percent (5%) individually,
(B) establish, amend, terminate or adopt any compensation or benefit plan including any pension, retirement, profit-sharing, bonus, retirement incentive or other employee benefit or welfare benefit plan or employment or severance agreement,
(C) accelerate the vesting of, or the lapsing of restrictions with respect to, any stock options or other stock-based compensation, (D) fail to make any required contributions under any Company Plan, (E) hire or terminate the
employment, or enter into or modify the contractual relationship of, any director, officer or employee with an annual base salary in excess of $200,000, except for new hires (i) filling positions open as of the date hereof or
(ii) replacing persons employed by the Company or any of its Subsidiaries as of the date hereof, but whose employment is terminated prior to Closing in the ordinary course of business, provided, that in each case, such new hire shall
occur only with the consent of the Parent in writing (which consent shall not be unreasonably withheld, conditions, or delayed), and the annual base salary for such hire shall not exceed that of the person he or she replaced in accordance with this
Section 5.1(b)(xv)(E);
(xvi) (A) implement or adopt any change in its methods of accounting, except as may be
required by Law or GAAP, (B) change its fiscal year, or (C) make any material change in internal accounting controls or disclosure controls and procedures that would reasonably be expected to negatively affect the Company;
(xvii) (A) prepare or file any material Tax Return that is materially inconsistent with past practice, (B) on any such Tax
Return, take any position, make or change any
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election, or adopt any method in a manner that is inconsistent with positions taken or elections made in preparing or filing any similar Tax Returns in prior periods or settle or compromise any
material Tax liability or refund or rescind any election in a manner that is inconsistent with past practice, or (C) file any amended Tax Return involving a material amount of Taxes, or waive or extend the statute of limitations in respect of
Taxes;
(xviii) settle or compromise, or propose to settle or compromise, any Action before a Governmental
Entity if such settlement or compromise (A) with respect to the payment of monetary damages, involves the payment of monetary damages that exceed $3,500,000 (together with all other settlements or compromises after the date of this Agreement),
net of any amount covered by insurance or (B) imposes any material equitable or non-monetary relief on the Company or any of its Subsidiaries; provided, that (x) in no event shall the Company settle or compromise any Action in
violation of Section 2.2(i) or Section 5.12 (which such Actions shall be governed solely by the applicable of Section 2.2(i) or Section 5.12 and not by this Section 5.1(b)(xviii)) and
(y) the Acquired Companies may at any time, without Parent’s consent, settle warranty or product liability claims received in the ordinary course of business in a manner and amounts that is consistent with past practice;
(xix) other than non-exclusive licenses granted in the ordinary course of business consistent with past practice, enter into
any agreement, arrangement or commitment to grant a license of material Owned Intellectual Property to any Person other than an Acquired Company;
(xx) dispose of or permit to lapse any ownership or right to use, or fail to maintain registration of any material Owned
Intellectual Property, except in the ordinary course of business consistent with past practice;
(xxi) except in the
ordinary course of business, enter into, materially amend, materially modify or terminate (other than a termination in accordance with its terms) any Material Contract, or material Real Property Lease or Contract that would be a Material Contract or
material Real Property Lease if in effect on the date of this Agreement or;
(xxii) waive, extend, renew or enter into any
non-compete, most favored nation, exclusivity, non-solicitation or similar Contract that (A) would following the Closing apply such non-competition, most favored nation, exclusivity, non-solicitation or similar restriction to Parent or any of
its Subsidiaries (other than the Acquired Companies) or (B) would restrict or limit, in any material respect, the freedom of the Acquired Companies, taken as a whole, in conducting their operations or business, as after the Closing (other than,
in the case of this clause (B) only, the renewal of any existing customer or supplier Contract, or entry into a new customer or supplier Contract with an existing customer or supplier, containing non-competition, most favored nation,
exclusivity, non-solicitation or similar restrictions substantially similar to or more favorable to the Acquired Companies than those set forth in existing Contracts with such customer or supplier);
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(xxiii) effectuate a “plant closing” or “mass layoff,” as
those terms are defined in WARN;
(xxiv) create any Subsidiary;
(xxv) enter into any new line of business;
(xxvi) enter into, amend or modify any union recognition agreement, collective bargaining agreement or similar agreement with
any trade union or representative body of the Company or any Subsidiary, or, except to the extent required by applicable Law, enter into negotiations regarding any such agreement;
(xxvii) sell, pledge, dispose of or encumber any Owned Real Property other than, in the case of pledges and encumbrances, for
Permitted Liens; or
(xxviii) agree to, authorize, or enter into any Contract obligating it to take any of the actions
described in Section 5.1(b)(i) through (xxvii).
(c) Parent will, promptly following the date of this Agreement,
designate two (2) individuals from either of whom the Company may seek approval to undertake any actions not permitted to be taken under this Section 5.1. The making of a request by the Company pursuant to this
Section 5.1(c) shall not be an admission that, or otherwise imply that, the Company is required to seek an approval from Parent in connection with the subject matter of such request or any similar request.
(d) Nothing contained in this Agreement is intended to give Parent or Merger Sub, directly or indirectly, the right to control or direct the
Company’s or its Subsidiaries’ operations prior to the Effective Time, and nothing contained in this Agreement is intended to give the Company, directly or indirectly, the right to control or direct Parent’s or its Subsidiaries’
operations. Prior to the Effective Time, each of Parent and the Company shall exercise, consistent with the terms and conditions of this Agreement, complete control and supervision over its and its Subsidiaries’ respective operations.
Section 5.2 Obligations of Merger Sub and Surviving Corporation. Parent agrees to cause Merger Sub and the Surviving Corporation
to perform all of their respective agreements, covenants and obligations under this Agreement. Parent hereby guarantees the due, prompt and faithful payment, performance and discharge by Merger Sub and the Surviving Corporation of, and the
compliance by Merger Sub and the Surviving Corporation with, all of their respective covenants, agreements, obligations and undertakings under this Agreement in accordance with the terms of this Agreement. Parent shall (and shall cause each other
stockholder of Merger Sub to), promptly on the date hereof following execution of this Agreement, approve this Agreement in its capacity as a stockholder of Merger Sub in each case in accordance with applicable Law and the certificate of
incorporation and bylaws of Merger Sub.
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Section 5.3 Acquisition Proposals.
(a) No Shop. From the execution of this Agreement until the earlier of the Effective Time and the termination of this Agreement in
accordance with its terms, except as otherwise expressly permitted by this Section 5.3:
(i) the Company shall,
and shall cause its Subsidiaries (and the directors and officers of it and its Subsidiaries) to, and shall use its reasonable best efforts to cause its and their respective Representatives (other than its and their respective officers and directors)
to: (A) immediately cease and cause to be terminated all existing discussions or negotiations by the Company (or, as applicable, such Subsidiary or such Representative) with any Person conducted heretofore with respect to any Acquisition
Proposal or any proposal, inquiry or offer that would reasonably be expected to lead to an Acquisition Proposal, and (B) request the prompt return or destruction of all confidential information previously made available by it or on its behalf
in connection with any Acquisition Proposal or any other proposal, inquiry or offer that would reasonably be or reasonably was expected to lead to an Acquisition Proposal;
(ii) the Company shall not terminate, waive, amend, release or modify in any respect any provision of any confidentiality
agreement to which any Acquired Company is a party in connection with any Acquisition Proposal or other proposal, inquiry or offer that would reasonably be expected to lead to an Acquisition Proposal; and
(iii) the Company shall not, and shall cause its Subsidiaries (and the respective officers and directors of it and its
Subsidiaries) not to, and shall use its reasonable best efforts to cause its and their respective Representatives (other than its and their respective directors and officers), not to, directly (or indirectly through third parties):
(A) solicit, initiate, or knowingly encourage, or knowingly induce or facilitate, the making, submission or announcement of
any inquiries or the making of any proposal or offer constituting, related to or that would reasonably be expected to lead to an Acquisition Proposal;
(B) make available any non-public information regarding any of the Acquired Companies to any Person (other than Parent and
Parent’s or the Company’s Representatives acting in their capacities as such) in connection with or in response to an Acquisition Proposal or any proposal, inquiry or offer that would reasonably be expected to lead to an Acquisition
Proposal;
(C) engage in discussions or negotiations with any Person with respect to any Acquisition Proposal or any
proposal, inquiry or offer that would reasonably be expected to lead to an Acquisition Proposal (other than to state that they currently are not permitted to have discussions);
(D) enter into any letter of intent or agreement in principle or any Contract concerning any Acquisition Proposal or any
proposal, inquiry or offer that would reasonably be expected to lead to an Acquisition Proposal (other than an Acceptable Confidentiality Agreement in accordance with Section 5.3(b)); or
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(E) reimburse or agree to reimburse the expenses of any other person (other than
the Company’s Representatives) in connection with an Acquisition Proposal or any inquiry, discussion, offer or request that would reasonably be expected to lead to an Acquisition Proposal.
(b) No-Shop Exceptions. Notwithstanding anything to the contrary in this Agreement, if at any time prior to obtaining the Company
Stockholder Approval:
(i) (A) the Company receives, after the date of this Agreement, an unsolicited bona fide
written Acquisition Proposal that did not result from a breach of this Section 5.3, (B) the Company Board determines in good faith (after consultation with outside counsel and its financial advisor) that such Acquisition Proposal
constitutes or would reasonably be expected to lead to a Superior Proposal and (C) the Company Board determines in good faith (after consultation with outside counsel) that the failure to take the actions referred to in clause
(x) or (y) of this Section 5.3(b)(i) would be inconsistent with its fiduciary duties under applicable Law, then, prior to obtaining the Company Stockholder Approval, the Acquired Companies and their respective
Representatives may (x) make available information with respect to the Company and its Subsidiaries to the Person making such Acquisition Proposal pursuant to an Acceptable Confidentiality Agreement; provided, that any non-public
information provided or made available to any Person given such access shall have been previously provided or made available to Parent or shall be provided or made available to Parent prior to, concurrently with or within twenty-four (24) hours
after the time it is provided or made available to such Person, and (y) participate in discussions or negotiations with the Person making such Acquisition Proposal regarding such Acquisition Proposal; provided, however, that the
Company and its Subsidiaries shall, and shall cause its and their respective Representatives to, cease any activities described in clause (x) or (y) of this Section 5.3(b)(i) promptly, and in any event within
twenty-four (24) hours, following the time that the Company Board determines in good faith, (after consultation with its financial advisor and outside counsel) that the applicable Acquisition Proposal has ceased to be a Superior Proposal and
has ceased to be an Acquisition Proposal that would reasonably be expected to lead to a Superior Proposal; or
(ii) the
Company Board determines in good faith (after consultation with outside counsel) that failure to do so would be inconsistent with its fiduciary duties under applicable Law, the Company may terminate, waive, amend, release a counterparty from, modify
or fail to enforce any standstill, confidentiality or similar provisions in any agreement to which the Company or any of its Subsidiaries is a party; provided, further that the Company shall advise Parent in writing no later than twenty-four
(24) hours after executing any release or waiver contemplated by the foregoing that the Company intends to provide or has provided such a release or waiver.
(c) Notice of Acquisition Proposals. The Company shall promptly, and in any event within twenty-four (24) hours of
receipt thereof, advise Parent in writing of the receipt of any
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Acquisition Proposal or any inquiry, proposal or offer that would reasonably be expected to lead to an Acquisition Proposal (including the identity of the Person making or submitting such
Acquisition Proposal, inquiry, proposal or offer and the material terms and conditions thereof and (with respect to an Acquisition Proposal) copies of proposed documents received (if any) to effect such Acquisition Proposal) that is made or
submitted by any Person prior to the Effective Time. The Company shall keep Parent reasonably informed on a reasonably prompt basis, and in any event within twenty-four hours of any material change, of the status of, and any financial or other
material changes in, any such Acquisition Proposal, inquiry, proposal or offer, including, if applicable, providing Parent copies of written proposals or offers and proposed documents (if any) to effect such Acquisition Proposal).
(d) Adverse Recommendation Changes. Neither the Company Board nor any committee thereof shall:
(i) (A) fail to include the Company Recommendation or the Company Determination in the Proxy Statement, (B) withhold
or withdraw (or qualify or modify in a manner adverse to Parent) the Company Recommendation, the Company Determination or the Company Board’s approval of this Agreement or the Merger or publicly propose to do so, (C) make any
recommendation in connection with a tender offer or exchange offer other than a recommendation against such offer or a “stop, look and listen” communication by the Company Board of the type contemplated by Rule 14d-9(f) under the
Exchange Act, or fail to recommend against acceptance of such a tender or exchange offer, including by taking no position with respect to acceptance of such tender or exchange offer, by the close of business on the earlier of (1) the tenth (10th) Business Day after the commencement of such tender offer or exchange offer pursuant to Rule 14d-2 under the Exchange Act and (2) the third
(3rd) Business Day prior to the Company Stockholders Meeting, (D) (except as permitted by Section 5.3(e)) adopt, approve, recommend to the stockholders of the Company,
endorse or otherwise declare advisable any Acquisition Proposal or resolve or agree or publicly propose to take any such actions or (E) fail to publicly reaffirm the Company Recommendation within the later of (1) five (5) Business
Days following receipt of a written notice from Parent, delivered after the public announcement of an Acquisition Proposal, which notice requests such reaffirmation and (2) the earlier of (I) three (3) Business Days prior to the
Company Stockholders Meeting and (II) ten (10) Business Days after the date on which such Acquisition Proposal is publicly announced (each such action set forth in this Section 5.3(d)(i) being referred to herein as an
“Adverse Recommendation Change”); or
(ii) except as permitted by Section 5.3(e), cause or
permit the Company to enter into any letter of intent, memorandum of understanding, agreement in principle, acquisition agreement, merger agreement, option agreement, joint venture agreement, partnership agreement or other agreement with respect to
an Acquisition Proposal (in each case other than an Acceptable Confidentiality Agreement) (each, an “Alternative Acquisition Agreement”).
(e) Permitted Adverse Recommendation Changes and Permitted Termination to Enter into a Superior Proposal. Notwithstanding anything to
the contrary in this Agreement, if, at any time prior to obtaining the Company Stockholder Approval, (x) an Acquisition Proposal is made
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that did not result from a breach of this Section 5.3 (and has not been withdrawn or abandoned), (y) the Company Board determines in good faith (after consultation with outside
counsel and its financial advisor) that such Acquisition Proposal constitutes a Superior Proposal and (z) the Company Board determines in good faith (after consultation with outside counsel) that failure to take an action described in clause
(i) or clause (ii) of this Section 5.3(e) would be inconsistent with the Company Board’s fiduciary duties under applicable Law, the Company Board may, in connection with such Superior Proposal, prior to obtaining the
Company Stockholder Approval:
(i) make an Adverse Recommendation Change; or
(ii) cause the Company to terminate this Agreement pursuant to Section 7.1(d)(ii) (and pay the Termination Fee due
in connection with such termination) to enter into an Alternative Acquisition Agreement with respect to such Superior Proposal,
provided that the
Company has first complied with the provisions of Section 5.3(f) in connection with such Acquisition Proposal.
(f) Match
Rights. The Company Board shall not take any action set forth in Section 5.3(e) unless the Company Board has first:
(i) caused the Company to provide Parent at least three (3) Business Days’ prior written notice of its intent to take
either of the actions set forth in clause (i) or clause (ii) of Section 5.3(e) (a “Notice of Superior Proposal”), which notice shall (A) state that the Company has received a Superior
Proposal, (B) specify the material terms and conditions of such Acquisition Proposal, (C) identify the Person making such Superior Proposal and (D) enclose the most recent draft of any agreements intended to be entered into with the
Person making or providing such Superior Proposal (or any Affiliate of such Person);
(ii) caused the Company and its
Representatives to negotiate, to the extent Parent so wishes to negotiate, during such three (3) Business Day period following delivery of the Notice of Superior Proposal (the “Notice Period”), in good faith with Parent
concerning any revisions to the terms of this Agreement that Parent proposes in response to such Superior Proposal; and
(iii) after complying with clauses (i) and (ii) of this Section 5.3(f), determined that
such Acquisition Proposal continues to constitute a Superior Proposal after giving due consideration to any changes proposed to be made to this Agreement by Parent in a signed writing, and that the failure to take an action set forth in
Section 5.3(e) continues to be inconsistent with the directors’ fiduciary duties under applicable Law;
provided, however,
that if during the Notice Period any revisions are made to the Superior Proposal that is the subject of such Notice of Superior Proposal and such revisions are material (it being understood and agreed that any change to consideration with respect to
such proposal is material), the Company shall deliver to Parent a new notice (“Superior Proposal Change Notice”) describing such material revisions (and providing copies of the most recent draft of any agreements implementing such
material revisions proposed to be entered into between the Company and the Person making or providing such Superior Proposal (or any Affiliate of such
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Person)) and shall comply with the requirements of clause (ii) and clause (iii) of this Section 5.3(f) with respect to such Superior Proposal as so revised
(substituting, for purposes of this proviso, the longer of (x) the time remaining with respect to the original three (3) Business Day Notice Period in respect of such Superior Proposal and (y) two (2) Business Days following
delivery by the Company of the Superior Proposal Change Notice for the reference to “three (3) Business Days” in Section 5.3(f)(ii)).
(g) Nothing contained in this Section 5.3 shall prohibit the Company or the Company Board from complying with its disclosure
obligations under United States federal or state Law with regard to an Acquisition Proposal, including (i) taking and disclosing a position contemplated by Item 1012(a) of Regulation M-A, Rule 14e-2(a) under the Exchange Act or
Rule 14d-9 under the Exchange Act or (ii) making any “stop, look and listen” communication to the stockholders of the Company pursuant to Rule 14d-9(f) under the Exchange Act;
provided, however, that neither the Company nor the Company Board (or any committee thereof) may effect an Adverse Recommendation Change except in compliance with Section 5.3(e) and Section 5.3(f).
(h) The Company shall use reasonable best efforts to enforce its rights under the Company Support Agreement.
(i) For purposes of this Agreement:
(i) “Acceptable Confidentiality Agreement” means a confidentiality agreement on terms that, taken as a whole,
are not materially less restrictive to the Company’s counterparty thereto than those contained in the Confidentiality Agreement, it being understood that any such confidentiality agreement need not contain a standstill provision or otherwise
prohibit the making, or amendment, of an Acquisition Proposal;
(ii) “Acquisition Proposal” means any
proposal or offer (whether or not in writing), with respect to any (A) merger, consolidation, share exchange, other business combination or similar transaction involving the Company, (B) sale, lease, contribution or other disposition,
directly or indirectly (including by way of merger, consolidation, share exchange, other business combination, partnership, joint venture, sale of capital stock of or other equity interests in a Subsidiary of the Company or otherwise) of any
business or assets of the Company or any of its Subsidiaries representing fifteen percent (15%) or more of the consolidated revenues, net income or assets of the Company and its Subsidiaries, taken as a whole, (C) issuance, sale or other
disposition, directly or indirectly, to any Person (or the stockholders of any Person) or group of securities (or options, rights or warrants to purchase, or securities convertible into or exchangeable for, such securities) representing fifteen
percent (15%) or more of the voting power of the Company, (D) transaction in which the holders of the voting power of the Company immediately prior to such transaction own ninety percent (90%) or less of the voting power of the
Company immediately following the transaction, (E) transaction in which any Person (or the stockholders of any Person) shall acquire, directly or indirectly, beneficial ownership, or the right to acquire beneficial ownership, or formation of
any group which beneficially owns or has the right to acquire beneficial ownership of, fifteen percent (15%) or more of the Shares or (F) any combination of the foregoing (in each case, other than the Merger).
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(iii) “Superior Proposal” means any bona fide
written offer made by a third party or group pursuant to which such third party or group would acquire, directly or indirectly, more than fifty percent (50%) of the Shares or more than fifty percent (50%) of the assets of the Company and
its Subsidiaries, taken as a whole, on terms which the Company Board determines in good faith (after consultation with outside counsel and a financial advisor of nationally recognized reputation), taking into account all factors the Company Board
considers relevant, including the financial, regulatory, legal and other aspects of such Acquisition Proposal (and any changes proposed by Parent to the terms of this Agreement in a signed writing), is more favorable to Company stockholders than the
Merger from a financial point of view.
(j) Any action taken or not taken by any Representative of the Company or any of its Subsidiaries
at the express or implied direction of the Company that if taken or not taken by the Company would constitute a breach of this Section 5.3 shall be deemed a breach of this Agreement by the Company.
Section 5.4 Preparation of the Proxy Statement; Stockholders Meeting.
(a) As soon as practicable following the date of this Agreement, the Company shall prepare and, no later than July 30, 2015 or such other
later date as mutually agreed upon by the Company and Parent in writing, file with the SEC a proxy statement in preliminary form relating to the Company Stockholders Meeting (the “Proxy Statement”). The Company will cause the Proxy
Statement to comply as to form in all material respects with the applicable provisions of the Exchange Act and shall use its reasonable best efforts to cause the Proxy Statement to be mailed to stockholders of the Company as soon as reasonably
practicable (and in any event within five (5) Business Days) after (i) if the Company does not receive comments from the SEC with respect to the preliminary Proxy Statement and does not reasonably believe that it will receive comments, the
eleventh (11th) calendar day immediately following the date of filing of the preliminary Proxy Statement with the SEC and (ii) if the Company does receive comments from the SEC with
respect to the preliminary Proxy Statement, clearance by the SEC with respect to such comments (clause (i) or (ii), as applicable, “SEC Clearance”). Parent and Merger Sub shall cooperate with the Company in connection with the
preparation of the Proxy Statement, including providing to the Company any and all information regarding Parent and Merger Sub and their respective Affiliates as may be required to be disclosed therein as promptly as possible after the date hereof.
The Parties shall notify each other promptly of the receipt of any comments from the SEC or its staff and of any request by the SEC or its staff for amendments or supplements to the Proxy Statement or for additional information and shall supply each
other with copies of all correspondence between such or any of its representatives, on the one hand, and the SEC or its staff, on the other hand, with respect to the Proxy Statement or the Merger. If the Company does receive comments from the SEC
with respect to the Proxy Statement, the Company shall use its reasonable best efforts (with the reasonable assistance of Parent) to promptly provide responses to the SEC with respect to any comments received on the Proxy Statement from the SEC and
to have the Proxy Statement cleared by the SEC as soon as reasonably practicable after the date of this Agreement.
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(b) The Company and Parent each agrees, as to itself and its respective Subsidiaries, that none
of the information supplied or to be supplied by it or its Subsidiaries for inclusion or incorporation by reference in the Proxy Statement or any amendment or supplement thereto will, at the date of mailing to stockholders and at the time of the
meeting of stockholders of the Company to be held in connection with the Merger, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading. If, at any time prior to receipt of the Company Stockholder Approval, any event occurs with respect to the Company, any of its Subsidiaries, Parent or Merger Sub, or any
change occurs with respect to other information to be included in the Proxy Statement, which is required to be described in an amendment of, or a supplement to, the Proxy Statement, or the Company or Parent should otherwise discover any information
relating to the Company or Parent (or any of their respective Affiliates, directors, officers or shareholders) that is required to be set forth in an amendment or supplement to the Proxy Statement so that it would not include any misstatement of a
material fact or omit to state any material fact necessary to make the statements therein, in light of the circumstances under which they are made, not misleading, the Company or Parent, as the case may be, shall promptly notify the other party of
such event, change or discovery, and the Company shall promptly file, with Parent’s cooperation, any necessary amendment or supplement to the Proxy Statement. The Company will also advise Parent, promptly after it receives notice thereof, of
any request by the SEC for amendment of the Proxy Statement.
(c) Notwithstanding the foregoing, prior to filing or mailing the Proxy
Statement (or any amendment or supplement thereto) or responding to any written comments of the SEC with respect thereto, the Company shall (i) provide Parent an opportunity to review and comment on such document or response and
(ii) consider in good faith all reasonable comments proposed by Parent.
(d) Unless there has occurred an Adverse Recommendation
Change in accordance with Section 5.3(e) (i) the Company shall, as soon as practicable following the date of SEC Clearance of the Proxy Statement, duly call, give notice of, convene and hold a meeting of the holders of Shares (the
“Company Stockholders Meeting”) for the purpose of seeking the Company Stockholder Approval, and (ii) the notice of such Company Stockholders Meeting shall state that a resolution to adopt this Agreement will be considered at
the Company Stockholders Meeting. Unless the Company Board has effected an Adverse Recommendation Change in accordance with Section 5.3(e), (x) the Company Board shall include the Company Determination and the Company Recommendation
in the Proxy Statement and (y) the Company shall use its reasonable best efforts to solicit the Company Stockholder Approval. The Company shall not include in the Proxy Statement any proposal to vote upon or consider any Acquisition Proposal
(other than this Agreement and the Merger). The Company shall not postpone or adjourn the Company Stockholders Meeting without the prior written consent of Parent (other than for any such postponements or adjournments (i) required by the SEC or
the order of a court of competent jurisdiction, or (ii) of not more than thirty (30) days in the aggregate that are otherwise required by Law or that are due to the failure of a quorum to be present on the date scheduled for such meeting).
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Section 5.5 Access to Information; Confidentiality.
(a) From the date hereof to the Effective Time or the earlier termination of this Agreement, subject to applicable Law and upon reasonable
prior notice (and solely to the extent not unreasonably disruptive to the business, employees or management of any Acquired Company), the Company shall, and shall cause each of its Subsidiaries to, and use its reasonable best efforts to cause its
Representatives to, afford to Parent, Merger Sub and their respective Representatives reasonable access during normal business hours to the Company’s and its Subsidiaries’ officers, employees, properties, offices, other facilities and
books and records, and shall make available to Parent, Merger Sub and their respective Representatives all financial, operating and other data and information as Parent, Merger Sub and their respective Representatives shall reasonably request,
provided that the foregoing shall not require the Company or its Subsidiaries (i) to permit any access or inspection, or to disclose any information, that in the reasonable judgment of the Company would result in the disclosure of any
trade secrets of third parties or (provided that the Company has used commercially reasonable efforts to obtain the consent of such third party) violate any of its obligations with respect to confidentiality owed to third parties, or (ii) to
disclose any privileged information of it or any of its Subsidiaries, or (iii) allow any environmental testing or sampling. All requests for access or information made pursuant to this Section 5.5 shall be directed to the executive
officer or other Person designated by the Company. All such information shall be governed by the terms of the Confidentiality Agreement.
(b) Each of Parent and Merger Sub will hold and treat and will cause its Representatives to hold and treat in confidence all documents and
information concerning the Company and its Subsidiaries made available to Parent or Merger Sub in connection with the transactions contemplated by this Agreement in accordance with the letter agreement between the Company and Parent dated
April 30, 2015 (the “Confidentiality Agreement”) which Confidentiality Agreement shall remain in full force and effect in accordance with its terms.
Section 5.6 Further Action; Efforts.
(a) Subject to the terms and conditions of this Agreement, each Party will cooperate with each other Party and use (and cause their respective
Subsidiaries to use) their reasonable best efforts to take, or cause to be taken, all actions and to do, or cause to be done, all things necessary, proper or advisable under applicable Law to consummate the Merger as soon as reasonably practicable.
In furtherance and not in limitation of the foregoing, each Party hereto agrees (i) to make, if required, appropriate filings under any Antitrust Law as promptly as reasonably practicable, including an appropriate filing of a Notification and
Report Form pursuant to the HSR Act, with respect to the transactions contemplated hereby as promptly as reasonably practicable and in any event within ten (10) Business Days after the date hereof and (ii) to reasonably promptly provide to
each and every federal, state, local or foreign court or Governmental Entity with jurisdiction over enforcement of any applicable Antitrust Law (“Government Antitrust Entity”) all non-privileged information and documents requested
by any Government Antitrust Entity or that are necessary, proper or advisable to permit the consummation of the transactions contemplated by this Agreement. The Company and Parent shall each request early termination of the waiting period provided
for in the HSR Act.
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(b) Each of Parent and Merger Sub, on the one hand, and the Company, on the other hand, shall, in
connection with the efforts referenced in Section 5.6(a) to obtain all requisite approvals and authorizations for the transactions contemplated by this Agreement under the HSR Act or any other Antitrust Law, use its reasonable best
efforts to (i) reasonably cooperate in all respects with each other in connection with any filing or submission to and in connection with any investigation or other inquiry by a Governmental Entity, (ii) keep the other Party
reasonably informed of the status of any notice, approval, investigation or inquiry under Antitrust Law, or any other material investigation or other inquiry by a Governmental Entity, relating to the completion of the Merger, including promptly
forwarding to the other Party any notices or any other communication received by any of such Persons to it or its Subsidiary (or the Representatives of either of them) from, or given by such Party to, the Federal Trade Commission, the Antitrust
Division of the DOJ or any other U.S. or foreign Governmental Entity, in each case regarding any of the transactions contemplated hereby and (iii) permit the other Party a reasonable opportunity to review and comment on any substantive
written communication to be given to a Governmental Entity in connection with the matters that are the subject of this Agreement and to have its comments considered in good faith. Neither the Company nor Parent shall permit any of its officers or
any other Representatives to participate in any meeting or substantive telephone discussion with any Governmental Entity in respect of any filings, investigation or other inquiry with respect to the Merger or other transactions contemplated by this
Agreement unless to the extent practicable (i) it consults with the other Party in advance and (ii) to the extent permitted by such Governmental Entity, gives the other Party the opportunity to attend and participate in such meeting or
substantive telephone discussion. Notwithstanding the foregoing, the Company and Parent may, as each deems advisable and necessary, reasonably designate any competitively sensitive material provided to the other side under this
Section 5.6(b) as “Antitrust Counsel Only Material.” Such materials and the information contained therein shall be given only to the outside counsel of the recipient dealing with Antitrust Law matters, and will not be disclosed
by such outside counsel to employees, officers, directors or consultants of the recipient or any of its Affiliates unless express permission is obtained in advance from the source of the materials (the Company or Parent, as the case may be) or its
legal counsel. Each of the Company and Parent shall cause its respective counsel regarding Antitrust Law to comply with this Section 5.6(b). Notwithstanding anything to the contrary in this Section 5.6(b), materials provided
to the other Party or its counsel may be redacted to remove references concerning the valuation of the Company and privileged communications.
(c) Subject to the terms and conditions set forth in this Agreement, without limiting the generality of the other undertakings pursuant to
Section 5.6(a) and Section 5.6(b), but subject to Section 5.6(d), each of the Company (in the case of Section 5.6(c)(ii) set forth below) and Parent (in all cases set forth below) agree to take or
cause to be taken the following actions:
(i) the prompt use of its reasonable best efforts to avoid the entry of any
permanent, preliminary or temporary injunction or other order, decree, decision, determination or judgment under Antitrust Laws that would delay, restrain, prevent, enjoin or otherwise prohibit consummation of the transactions contemplated by this
Agreement, including the defense through litigation on the merits of any claim asserted in any court, agency or other proceeding by any Person under Antitrust Laws, including any Governmental Entity, seeking to delay, restrain, prevent, enjoin or
otherwise prohibit consummation of such transactions; and
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(ii) the prompt use of its reasonable best efforts to take, in the event that any
permanent, preliminary or temporary injunction, decision, order, judgment, determination or decree under Antitrust Laws is entered, issued or enacted, or becomes reasonably foreseeable to be entered, issued or enacted, in any proceeding, review or
inquiry of any kind that would make consummation of the transactions contemplated by this Agreement in accordance with the terms of this Agreement unlawful or that would delay, restrain, prevent, enjoin or otherwise prohibit consummation of the
transactions contemplated by this Agreement, any and all steps (including the appeal thereof, the posting of a bond or the taking of the steps contemplated by this clause (ii) of paragraph (c)) necessary to resist, vacate, modify, reverse,
suspend, prevent, eliminate, avoid or remove such actual, anticipated or threatened injunction, decision, order, judgment, determination, decree or enactment so as to permit such consummation on a schedule as close as possible to that contemplated
by this Agreement.
(d) Notwithstanding anything in this Agreement to the contrary, neither Parent nor any of its Subsidiaries shall be
obligated, in connection with any Antitrust Law (including in connection with any Action arising thereunder) or by any Government Antitrust Entity, to (i) proffer to, agree to or become subject to any order, judgment or decree to, sell, license
or dispose of or hold separate, before or after the Closing, any assets, businesses, product lines or interest in any assets or businesses of Parent or any of its Affiliates or the Company or any of its Subsidiaries, or to consent to any sale,
license, or disposition, or agreement to sell, license or dispose, by the Company or any of its Subsidiaries, of any of their assets or businesses or product lines, (ii) proffer to, agree to, or become subject to any order, judgment or decree
to make or accept, any changes, modifications, limitations or restrictions in the operations of any assets or businesses of Parent or the Company or any of their respective Subsidiaries, or (iii) proffer to or agree to any new concession,
accommodation or liability; provided that, Parent shall be required to consent to the sale, license, disposition, holding separate of, or an agreement to sell, license, dispose of or hold separate, assets of the Company and the
Company’s Subsidiaries or any changes, modifications, limitations or restrictions in the operations of any assets or businesses of the Company or any of the Company’s Subsidiaries or any concession, accommodation or liability, solely with
respect to the assets, businesses or product lines (or interests therein), or operations, of the Company and its Subsidiaries (but not, for the avoidance of doubt, Parent or its Subsidiaries (other than the Company and its Subsidiaries)), to the
extent that (A) such sale, license, disposition, holding separate, change, modification, limitation, restriction, concession, accommodation or other matter or agreement to sell, license, dispose of, hold separate, modify, limit, restrict, make
a concession or accommodation or incur a liability, or other matter, is required by a Government Antitrust Entity in order to obtain any consent or approval referred to in Section 6.1(b) and (B) such sale, license, disposition,
holding separate or agreement to sell, license, dispose of, hold separate, change, modification, limitation, restriction, concession, accommodation, liability or other matter (or agreement to do any of the foregoing), taken together with all other
such sales, licenses, dispositions, holdings separate, changes, modifications, limitations, restrictions, concessions, accommodations, liabilities or other matters (and agreements to do any of the foregoing) Parent and its Subsidiaries have agreed
or become subject to pursuant to this proviso, would not materially diminish the value of the Acquired
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Companies taken as a whole. Neither the Company nor any of its Subsidiaries shall proffer to, agree to or become subject to any of the items set forth in clauses (i), (ii) and (iii) of
the preceding sentence without the prior written consent of Parent, and none of the Company nor any of its Subsidiaries shall be required to agree to any of the items set forth in clauses (i), (ii) and (iii) of the preceding sentence (or
contemplated by the proviso thereof) that is not conditioned on the occurrence of the Effective Time.
(e) For purposes of this Agreement,
“Antitrust Law” means the Sherman Act, as amended, the Clayton Act, as amended, the HSR Act, the Federal Trade Commission Act, as amended and all other Laws that are designed or intended to prohibit, restrict or regulate actions
having the purpose or effect of monopolization or restraint of trade or lessening of competition through merger or acquisition.
(f) Prior
to the Closing, Parent shall not negotiate, effect or agree to any business combination (whether structured as a merger, tender offer, exchange offer or otherwise), or the acquisition of any assets, licenses, rights, product lines, operations or
businesses of any person, that would, or would reasonably be expected to, prevent or materially delay or impair the consummation of the Merger for or due to Antitrust Law-related reasons.
(g) In the event that Parent notifies the Company at least ten (10) Business Days prior to the Effective Time that Parent has determined
to repay, effective at or after the Effective Time, all amounts outstanding under (i) both (A) the Credit Agreement, dated as of December 17, 2010, among the Company, the other borrowers thereto, Wells Fargo Capital Finance, LLC, Bank
of America, N.A., Merrill Lynch, Pierce, Fenner & Smith, Inc., and the lenders party thereto, as amended by the First Amendment to Credit Agreement, dated as of March 5, 2013, and further amended by the Second Amendment to Credit
Agreement, dated as of December 31, 2014 (as amended, modified or supplemented, the “Revolving Credit Facility”); and (B) the Second Amended and Restated Term B Loan Credit Agreement, dated as of December 31, 2014,
among the Company, Bank of America, N.A., Merrill Lynch, Pierce, Fenner & Smith, Incorporated, UBS Securities LLC, Wells Fargo Securities, LLC, Deutsche Bank Securities Inc., and Wells Fargo Bank, N.A. (as amended, modified or supplemented,
the “Term Loan Facility”) or (ii) any other Credit Agreement, the Company shall, at Parent’s request, and sole cost, use commercially reasonable efforts to obtain customary payoff letters and instruments of discharge to be
delivered at, and effective at, the Effective Time, providing for the payoff, discharge and termination in full of all obligations under, and the release of all Liens and pledges of collateral securing obligations made in connection with, the
Revolving Credit Facility and the Term Loan Facility or such other Credit Agreement. Notwithstanding anything to the contrary in this Section 5.6, neither the Company nor any of its Subsidiaries, nor any of their Representatives,
(i) shall be obligated to pay, repay, prepay or otherwise retire any amounts outstanding under (or otherwise make any payment in connection with) the Revolving Credit Facility or the Term Loan Facility or such other Credit Agreement unless
(x) the Company has received from Parent funds to pay in full the payoff amount for the Revolving Credit Facility and the Term Loan Facility and (as applicable) such other Credit Agreement and any fees or other amounts payable to the lenders or
their agents thereunder in connection with the matters contemplated by this Section 5.6(g) and (y) to the extent required by the lenders or their agents under the Revolving Credit Facility (or such other Credit Agreement) pursuant
to the terms thereof, Parent has agreed to and has provided backstop letters of credit or cash collateralized any existing letters of credit and
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guarantees and hedging arrangements and other bank products thereunder in a manner satisfactory to the lenders under the Revolving Credit Facility (or such other applicable Credit Agreement), to
the extent applicable, or (ii) (without limiting clause (i)) shall be required to enter into any definitive agreement or have any liability or obligation under any certificate, document, instrument, credit agreement or any related document or
any other agreement or document related to the retirement, payment, repayment or prepayment of amounts outstanding under the Revolving Credit Facility, the Term Loan Facility or any other Credit Agreement, in each case that is not contingent upon
the Effective Time having occurred. Parent shall indemnify and hold harmless the Company, its Subsidiaries and their respective Representatives from and against any damages, losses, costs, or expenses (including attorney’s fees) incurred by any
of them as a result of or in connection with their performance under this Section 5.6(g).
(h) Notwithstanding the foregoing,
nothing in this Agreement shall require Parent, the Company or Merger Sub to, and the Company shall not without the prior written consent of Parent, proffer or agree to any concession or additional liability with any Contract counterparty or any of
its Affiliates in order to obtain any consent sought under any Contract.
Section 5.7 Employee Benefits Matters.
(a) Parent agrees that each employee of the Company and its Subsidiaries at the Effective Time who continues to remain employed by Parent or a
Subsidiary thereof following the Closing Date (a “Continuing Employee”) shall, during the period commencing at the Effective Time and ending on December 31, 2016, be provided with (i) base salary or base wage, target
annual cash incentive compensation and employee benefits (excluding long-term incentive compensation opportunities and post-termination welfare benefits) which, in the aggregate are no less favorable than the base salary or base wage, target annual
cash incentive compensation and employee benefits (but excluding long-term incentive compensation opportunities and post-termination welfare benefits) provided by the Company and its Subsidiaries to each such Continuing Employee immediately prior to
the Effective Time and (ii) severance benefits that are no less favorable than the severance benefits provided by the Company and its Subsidiaries to such Continuing Employees immediately prior to the Effective Time that are set forth on
Section 5.7(a) of the Company Disclosure Letter with respect to the Continuing Employees subject thereto; provided, however, that the requirements of this Section 5.7(a) shall not apply to Continuing Employees who are
covered by a collective bargaining agreement.
(b) Following the Effective Time, Parent shall give each Continuing Employee full credit
for prior service with the Company or its Subsidiaries to the extent such service would be recognized if it had been performed as an employee of Parent for purposes of eligibility, vesting and determination of benefit levels under any Parent
Employee Plans or policy of general application relating to vacation or severance, except for benefit accrual purposes under any defined benefit plan of Parent, for purposes of determining eligibility for retiree and other post-termination health
and welfare benefits or to the extent it would result in a duplication of benefits. For the avoidance of doubt, no Continuing Employee shall be retroactively eligible for any Parent Employee Plan, including any such Parent Employee Plan that was
frozen prior to the Effective Time. In addition, Parent shall use commercially reasonable efforts to (i) waive, or cause to be waived, any pre-existing conditions, exclusions and waiting periods with respect to participation and coverage
requirements applicable to any Continuing Employee under any
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Parent Employee Plan to the extent they were inapplicable to, or satisfied under, the Company Plan in which any such employee participated immediately prior to the Effective Time and
(ii) give each Continuing Employee credit for the plan year in which the Effective Time occurs towards applicable deductibles and annual out-of-pocket limits for medical expenses incurred prior to the Effective Time for which payment has been
made. For purposes of this Agreement, the term “Parent Employee Plan” means any “employee pension benefit plan” (as defined in Section 3(2) of ERISA), “employee welfare benefit plan” (as defined in
Section 3(1) of ERISA), and any other formal written plan or policy under which service with Parent is relevant to eligibility, vesting and/or level of benefits, for the benefit of, or relating to, the current employees of Parent or its
Subsidiaries and with respect to which eligibility has not been frozen.
(c) The Company shall take (or cause to be taken) all actions
necessary or appropriate to terminate, effective no later than the day immediately preceding the Closing Date: (a) any Company Plan that contains a cash or deferred arrangement intended to qualify under Section 401(a) of the Code (the
“Company 401(k) Plans”); and (b) any Company Plan set forth on Section 5.7(c) of the Company Disclosure Letter, unless Parent, in its sole and absolute discretion, agrees to sponsor and maintain any such Company Plans by
providing the Company with written notice of such election at least five (5) days before the Effective Time. Unless Parent so provides notice to the Company, the Company shall deliver to Parent, prior to the Closing Date, evidence that the
Company Board has validly adopted resolutions to terminate such Company Plans (the form and substance of which resolutions shall be subject to review and approval of Parent, which approval shall not be unreasonably withheld, conditioned or delayed),
effective no later than the date immediately preceding the Closing Date.
(d) If Parent maintains a defined contribution plan that
includes a qualified cash or deferred arrangement within the meaning of Section 401(k) of the Code (the “Parent 401(k) Plan”) and Parent elects to have the Company and Affiliates, as applicable, terminate the Company 401(k)
Plans pursuant to Section 5.7(c), Parent shall permit each Continuing Employee participating in the Company 401(k) Plans to elect, and Parent agrees to cause the Parent 401(k) Plan to accept, in accordance with applicable Law and the
terms of the Parent 401(k) Plan and, subject to Parent’s determination, in its sole discretion, that the applicable Company 401(k) Plan meets the requirements of Section 401, et. seq. of the Code, a “direct rollover”
(within the meaning of Section 401(a)(31) of the Code) of his or her account balances (including earnings thereon through the date of transfer and, to the extent practicable with the use of commercially reasonable efforts, promissory notes
evidencing all outstanding loans) under the Company 401(k) Plans. Each Continuing Employee shall become a participant in the Parent 401(k) Plan on the Closing Date (giving effect to the service crediting provisions of Section 5.7(b)); it
being agreed that no Continuing Employee shall experience a gap in eligibility to participate in a tax-qualified defined contribution plan as a result of the transactions contemplated by this Agreement.
(e) Parent shall, and shall cause the Surviving Corporation to, honor in accordance with their respective terms all employee benefit
obligations to current and former employees under each Company Plan set forth on Section 5.7(e) of the Company Disclosure Letter.
(f) Nothing contained herein shall be construed as requiring, and the Company shall take no action that would have the effect of requiring,
Parent or the Surviving Corporation to
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continue any specific employee benefit plans or to continue the employment of any specific person. The provisions of this Section 5.7 are for the sole benefit of the Parties and
nothing herein, expressed or implied, is intended or shall be construed to (i) constitute an amendment to any of the compensation and benefits plans (including the Company Plans and the Parent Employee Plans) maintained for or provided to
Continuing Employees prior to or following the Effective Time, (ii) impede or limit Parent, the Company, the Surviving Corporation or any of their Affiliates from, following the Effective Time, amending or terminating any Company Plan in
accordance with its terms or (iii) confer upon or give to any person (including for the avoidance of doubt any current or former employees, directors, or independent contractors of the Company or any of its Subsidiaries, or on or after the
Effective Time, the Surviving Corporation or any of its Subsidiaries), other than the Parties hereto and their respective permitted successors and assigns, any legal or equitable or other rights or remedies (with respect to the matters provided for
in this Section 5.7) under or by reason of any provision of this Agreement.
Section 5.8 Notification of Certain
Matters. The Company and Parent shall promptly notify each other of the receipt of any written communication received from any Person alleging that a material consent of such Person is or may be required in connection with the transactions
contemplated by this Agreement or from any Governmental Entity in connection with the transactions contemplated by this Agreement.
Section 5.9 Indemnification, Exculpation and Insurance.
(a) Without limiting any additional rights that any director or employee may have under the Company Constituent Documents, any agreement or
Company Plan, from and after the Effective Time through the sixth (6th) anniversary of the date on which the Effective Time occurs, Parent shall, and shall cause the Surviving Corporation to,
indemnify and hold harmless, to the fullest extent permitted under applicable Law (and Parent shall also advance expenses as incurred to the fullest extent permitted under applicable Law, subject to the immediately following sentence), each present
and each former officer or director of the Company or any of its Subsidiaries (and each Person who may become an officer or director of the Company or a Company Subsidiary between the date of this Agreement and the Effective Time) (collectively, the
“Indemnified Parties”), against any costs or expenses (including reasonable attorneys’ fees), judgments, fines, losses, claims, damages or liabilities incurred in connection with any Action, whether civil, criminal,
administrative or investigative, arising out of or related to such Indemnified Party’s service as a director, officer or employee of the Company or its Subsidiaries or services performed by such persons at the request of the Company or its
Subsidiaries at or prior to the Effective Time, whether asserted or claimed prior to, at or after the Effective Time, including (i) the Merger and the other transactions contemplated by this Agreement and (ii) actions to enforce this
Section 5.9 or any other indemnification or advancement right of any Indemnified Party. Notwithstanding anything to the contrary herein (but subject to any superior rights contained in the Company Constituent Documents (or, as relevant,
those of the applicable Subsidiary of the Company) or applicable indemnification agreements to which any Acquired Company is a party), prior to making any advance in respect of the indemnification obligations set forth in this
Section 5.9, the Person who is requesting such advance shall agree to repay such advances if it is ultimately determined that such Person is not entitled to indemnification in respect of the matter for which such advance was made.
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(b) Except as may be required by applicable Law, Parent and the Company agree that for a period
of six (6) years from the Effective Time, all rights to indemnification and exculpation from liabilities for acts or omissions occurring at or prior to the Effective Time and rights to advancement of expenses relating thereto now existing in
favor of any Indemnified Party as provided in the Company Constituent Documents (or, as relevant, the organizational documents of any Company Subsidiary) or in any indemnification agreement between such Indemnified Party and the Company or any of
its Subsidiaries shall survive the Merger and continue in full force and effect, and for a period of six (6) years from the Effective Time shall not be amended, repealed or otherwise modified in any manner that would adversely affect any right
thereunder of any such Indemnified Party.
(c) Prior to the Effective Time, the Company shall and, if the Company is unable to, Parent
shall cause the Surviving Corporation as of the Effective Time to, obtain and fully pay the premium for the extension of (i) the directors’ and officers’ liability coverage of the Company’s existing directors’ and
officers’ insurance policies, and (ii) the Company’s existing fiduciary liability insurance policies, in each case for a claims reporting or discovery period of at least six (6) years from and after the Effective Time from one or
more insurance carriers with the same or better credit rating as the Company’s insurance carrier as of the date hereof with respect to directors’ and officers’ liability insurance and fiduciary liability insurance (collectively,
“D&O Insurance”) with terms, conditions, retentions and limits of liability that are at least as favorable to the insureds as the Company’s existing policies with respect to any actual or alleged error, misstatement,
misleading statement, act, omission, neglect, breach of duty or any matter claimed against a director or officer of the Company or any of its Subsidiaries by reason of him or her serving in such capacity that existed or occurred at or prior to the
Effective Time (including in connection with this Agreement or the transactions or actions contemplated hereby); provided, however, that in no event shall the Company expend, nor shall Parent or the Surviving Corporation be required to
expend, for such policies pursuant to this sentence an amount in excess of 300% of the annual premiums currently paid by the Company as of the date hereof for such insurance as set forth on Section 5.9(c) of the Company Disclosure Letter. If
the Company and the Surviving Corporation for any reason fail to obtain such “tail” insurance policy as of the Effective Time, the Surviving Corporation shall, and Parent shall cause the Surviving Corporation to, continue to maintain in
effect for a period of at least six (6) years from and after the Effective Time the D&O Insurance in place as of the date hereof with terms, conditions, retentions and limits of liability that are at least as favorable to the insureds as
provided in the Company’s existing policies as of the date hereof, or the Surviving Corporation shall, and Parent shall cause the Surviving Corporation to, use reasonable best efforts to purchase comparable D&O Insurance for such six
(6)-year period with terms, conditions, retentions and limits of liability that are at least as favorable as provided in the Company’s existing policies as of the date hereof; provided, however, that in no event shall Parent or
the Surviving Corporation be required to expend for such policies pursuant to this sentence an annual premium amount in excess of 300% of the annual premiums currently paid by the Company as of the date hereof for such insurance as set forth on
Section 5.9(c) of the Company Disclosure Letter; and provided, further, that if the annual premiums of such insurance coverage exceed such amount, the Surviving Corporation shall obtain a policy with the greatest coverage
reasonably available for a cost not exceeding such amount.
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(d) Notwithstanding anything herein to the contrary, if any Action (whether arising before, at or
after the Effective Time) with respect to which an Indemnified Party is entitled to indemnification is instituted against any Indemnified Party on or prior to the sixth (6th) anniversary of
the Effective Time, then the provisions of this Section 5.9 shall continue in effect until the final disposition of such Action.
(e) The indemnification provided for herein shall not be deemed exclusive of, and shall be in addition to, any other rights to which an
Indemnified Party is entitled, whether under the organizational documents of any Acquired Company or pursuant to Law, Contract or otherwise. The provisions of this Section 5.9 shall survive the consummation of the Merger and,
notwithstanding any other provision of this Agreement that may be to the contrary, expressly are from and after the Effective Time intended to benefit, and shall be enforceable by, each of the Indemnified Parties and their respective heirs and legal
representatives.
(f) In the event that the Surviving Corporation or Parent or any of their respective successors or assigns
(i) consolidates with or merges into any other Person and is not the continuing or surviving corporation or entity of such consolidation or merger or (ii) transfers or conveys all or a majority of its properties and assets to any Person,
then, and in each such case, proper provision shall be made so that the successors and assigns of the Surviving Corporation or Parent, as the case may be, shall succeed to the obligations set forth in this Section 5.9.
Section 5.10 Rule 16b-3. Prior to the Effective Time, the Company shall take such steps as may be reasonably necessary or
advisable hereto to cause dispositions of Shares, Company Equity Awards, and any other equity securities (including derivative securities) pursuant to the transactions contemplated by this Agreement by each individual who is a director or officer of
the Company, subject to the reporting requirements of Section 16(a) of the Exchange Act with respect to the Company, to be exempt under Rule 16b-3 promulgated under the Exchange Act.
Section 5.11 Anti-Takeover Statute. If any Takeover Law is or may become applicable to the Merger or any of the other transactions
contemplated by this Agreement, each of the Company, Parent and Merger Sub and their respective boards of directors shall grant all such approvals and take all such actions as are reasonably necessary or appropriate so that such transactions may be
consummated as promptly as practicable hereafter on the terms contemplated hereby, and otherwise act reasonably to eliminate or minimize the effects of such Law on such transactions.
Section 5.12 Stockholder Litigation. The Company shall provide Parent with prompt notice of all proceedings, and copies of all
correspondence received from or to be sent to actual or prospective adverse parties (or any of their representatives) or a Governmental Entity, relating to any Action against the Company, any of its Subsidiaries or any of their respective directors
or officers by any stockholder of the Company arising out of or relating to this Agreement or the transactions contemplated by this Agreement. The Company shall give Parent the opportunity to participate in the defense or settlement of any such
stockholder Action, provided that the Company shall control such defense and settlement and the disclosure of information in connection therewith shall be subject to the provisions of Section 5.5, including regarding
attorney-client privilege or other applicable legal privilege and provided further, that the
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Company shall not settle any litigation against the Company or its directors, executive officers or similar persons by any stockholder of the Company relating to this Agreement, the Merger, or
the other transactions contemplated by this Agreement without the prior written consent of Parent (which shall not be unreasonably withheld, conditioned or delayed), except for settlements providing solely for (a) money damages and the payment
of attorney’s fees in an aggregate amount (together with all other settlements entered into pursuant to this Section 5.12) not in excess of amounts equal to the dollar amount of the limits of the Company’s insurance and/or
(b) providing additional disclosure in the Proxy Statement that does not disparage Parent, Merger Sub, the Company, the Surviving Corporation, any of their respective Affiliates or any of their respective businesses.
Section 5.13 Public Announcements. Unless an Adverse Recommendation Change has occurred, each of Parent and Merger Sub, on the one
hand, and the Company, on the other hand, shall consult with each other before issuing, and give each other a reasonable opportunity to review and comment upon, any press release or other public statements with respect to this Agreement, the Merger
and the other transactions contemplated hereby and prior to making any filings with any third party and/or any Governmental Entity (including any national securities exchange or interdealer quotation service) with respect thereto, except and solely
to the extent required by applicable Law, court process or by obligations pursuant to any listing agreement with or rules of any national securities exchange or securities quotation system.
Section 5.14 Transfer Taxes. Except as provided for in Section 2.2(c), all stock transfer, real estate transfer,
documentary, stamp, recording and other similar Taxes (including interest, penalties and additions to any such Taxes) imposed on the Company or the Surviving Corporation or incurred in connection with this Agreement and the transactions contemplated
hereby shall be paid by either the Company or the Surviving Corporation. The Company and Parent shall cooperate in the preparation, execution, and filing of all Tax Returns, questionnaires or other documents with respect to such Taxes.
Section 5.15 Stock Exchange Delisting. Prior to the Closing Date, the Company shall cooperate with Parent and use reasonable
efforts to take, or cause to be taken, all actions, and do or cause to be done all things, reasonably necessary, proper or advisable on its part under applicable Laws and rules and policies of the NASDAQ Global Select Market to enable the delisting
by the Surviving Corporation of the Shares from the NASDAQ Global Select Market and the deregistration of the Shares under the Exchange Act as promptly as practicable after the Effective Time.
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ARTICLE VI
CONDITIONS PRECEDENT
Section 6.1 Conditions to Each Party’s Obligations to Effect the Merger. The respective obligations of each Party to effect
the Merger are subject to the satisfaction at or prior to the Closing of each of the following conditions, any and all of which may be waived, in whole or in part, by Parent, Merger Sub or the Company, as the case may be, to the extent permitted by
applicable Law:
(a) Stockholder Approval. The Company shall have obtained the Company Stockholder Approval.
(b) Other Regulatory Approvals. Any waiting period (and extensions thereof) applicable to the Merger under the HSR Act shall have
expired or been terminated, and all approvals, authorizations and consents set forth on Section 6.1(b) of the Company Disclosure Letter shall have been obtained and remain in full force and effect.
(c) No Injunctions, Orders or Restraints; Illegality. No Governmental Entity of competent jurisdiction shall have enacted, issued,
promulgated, enforced or entered any Law (whether temporary, preliminary or permanent) that is in effect that restrains or enjoins, or otherwise prohibits or makes illegal, the consummation of the Merger.
Section 6.2 Conditions to Obligations of Parent and Merger Sub. The obligations of Parent and Merger Sub to effect the Merger are
further subject to the satisfaction of the following conditions, any one or more of which may be waived by Parent (which waiver shall be effective both as to itself and as to Merger Sub) at or prior to the Closing:
(a) Representations and Warranties. (i) The representations and warranties of the Company set forth in Section 3.2(b)
shall be true and correct both when made and at and as of the Closing Date, as if made at and as of such date (except to the extent expressly made as of an earlier date, in which case such representation or warranty shall only be required to be true
and correct as of such earlier date), except for de minimis inaccuracies, (ii) the representation and warranty set forth in Section 3.8(b) (Absence of Certain Changes or Events) shall be true and correct in all
respects both when made and at and as of the Closing Date as if made at and as of such date, (iii) the representations and warranties of the Company set forth in the first and second sentences of Section 3.1(a) (Organization,
Standing and Power) and in Section 3.3 (Authority), Section 3.24 (Brokers), Section 3.25 (Takeover Statutes) and Section 3.26 (Fairness Opinion) shall be
true and correct in all material respects when made and at and as of the Closing Date, as if made at and as of such date (except to the extent expressly made as of an earlier date, in which case such representation or warranty shall only be required
to be true and correct as of such earlier date), (iv) the other representations and warranties of the Company set forth in Article III shall be true and correct both when made and at and as of the Closing Date, as if made at and as of
such date (except to the extent expressly made as of an earlier date, in which case such representation or warranty shall only be required to be true and correct as of such earlier date), except where the failure of such representations and
warranties to be so true and correct (without giving effect to any qualification as to materiality, Material Adverse Effect or similar qualification set forth therein), individually or in the aggregate, would not reasonably be expected to have a
Material Adverse Effect, and (v) Parent shall have received a certificate signed on behalf of the Company by an executive officer of the Company, dated as of the Closing Date, to the foregoing effect.
(b) Performance and Obligations of the Company. The Company shall have performed or complied in all material respects with all of its
agreements and covenants required by this Agreement to be performed or complied with by it at or prior to the Effective Time, and Parent shall have received a certificate signed on behalf of the Company by an executive officer of the Company, dated
as of the Closing Date, to the foregoing effect.
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Section 6.3 Conditions to Obligations of the Company. The obligation of the Company
to effect the Merger is further subject to the satisfaction of the following conditions, any one or more of which may be waived by the Company at or prior to the Closing:
(a) Representations and Warranties. (i) The representations and warranties of Parent and Merger Sub set forth herein shall be true
and correct in all respects both when made and at and as of the Closing Date, as if made at and as of such date (except to the extent expressly made as of an earlier date, in which case such representation or warranty shall only be required to be
true and correct as of such earlier date), except where the failure of such representations and warranties to be so true and correct (without giving effect to any qualification as to materiality or similar qualification set forth therein),
individually or in the aggregate, would not reasonably be expected to prevent, materially delay or impair the consummation by Parent and Merger Sub of the Merger in the manner contemplated by this Agreement and (ii) the Company shall have
received a certificate signed on behalf of Parent and Merger Sub by an authorized officer of each, dated as of the Closing Date, to the foregoing effect.
(b) Performance of Obligations of Parent and Merger Sub. Each of Parent and Merger Sub shall have performed or complied in all material
respects with all agreements and covenants required by this Agreement to be performed or complied with by it at or prior to the Effective Time, and the Company shall have received a certificate signed on behalf of Parent and Merger Sub by an
authorized officer of Parent and Merger Sub, dated as of the Closing Date, to the foregoing effect.
ARTICLE VII
TERMINATION, AMENDMENT AND WAIVER
Section 7.1 Termination. This Agreement may be terminated and the Merger may be abandoned at any time prior to the Effective Time,
notwithstanding any approval thereof by the stockholders of the Company (with any termination by Parent also being an effective termination by Merger Sub) only as follows:
| |
(a) |
by mutual written consent of Parent and the Company; |
| |
(b) |
by either Parent or the Company: |
(i) if any Governmental Entity of competent
jurisdiction shall have issued a judgment, order, injunction, rule or decree that permanently restrains or enjoins, or otherwise permanently prohibits or makes illegal, the consummation of the Merger, and such judgment, order, injunction, rule or
decree shall have become final and nonappealable; provided that the right to terminate this Agreement pursuant to this Section 7.1(b)(i) shall not be available to a Party if the breach by such Party of any covenant or
agreement set forth in this Agreement (it being understood and agreed that the Parent and Merger Sub shall be deemed to be a single Party for purposes of the foregoing proviso) shall have materially contributed to the issuance of such judgment,
order, injunction, rule or decree (or to such judgment, order, injunction, rule or decree becoming final and nonappealable);
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(ii) if, upon a vote taken at any duly held Company Stockholders Meeting (or at
any adjournment or postponement thereof) held to obtain the Company Stockholder Approval, the Company Stockholder Approval is not obtained; or
(iii) if the Effective Time shall not have occurred on or before April 12, 2016 (the “Outside Date”);
provided that no Party whose breach of this Agreement materially contributed to the failure of the Effective Time to occur prior to the Outside Date shall be entitled to terminate this Agreement pursuant to this
Section 7.1(b)(iii) (it being understood and agreed that the Parent and Merger Sub shall be deemed to be a single Party for purposes of the foregoing proviso).
| |
(c) |
by Parent, at any time prior to the Effective Time: |
(i) if
(A) (x) any of the representations or warranties of the Company set forth in Article III shall be untrue or inaccurate on the date of this Agreement or shall become untrue or inaccurate, or (y) the Company shall have breached
or failed to perform when required any of its covenants or agreements set forth in this Agreement, in the case of each of clause (x) and clause (y), such that any condition set forth in Section 6.2(a) or Section 6.2(b)
would not be satisfied if it were to be measured as of the time of such breach or failure, and such breach, untruth or inaccuracy either is not curable or, if curable, is not cured prior to the earlier of (i) thirty (30) days after written
notice thereof is given by Parent to the Company or (ii) two (2) Business Days prior to the Outside Date; provided, that Parent shall not have the right to terminate this Agreement pursuant to this Section 7.1(c)(i) if
Parent or Merger Sub is then in material breach of any of its representations, warranties, covenants or agreements set forth in this Agreement such that any condition set forth in Section 6.3(a) or Section 6.3(b) would not be
satisfied if it were to be measured as of the time of such breach; or
(ii) if, after the date hereof, the Company Board or
any committee thereof shall have effected an Adverse Recommendation Change (whether or not permitted to do so under the terms of this Agreement).
(i) if (A) (x) any of the representations or
warranties of Parent or Merger Sub set forth in Article IV shall be untrue or inaccurate on the date of this Agreement or shall become untrue or inaccurate, or (y) Parent or Merger Sub shall have breached or failed to perform when
required any of their respective covenants or agreements set forth in this Agreement, in the case of each of clause (x) and clause (y), such that any condition set forth in Section 6.3 would not be satisfied if it were
to be measured as of the time of such breach or failure, and such breach, untruth or inaccuracy either is not curable or, if curable, is not cured prior to the earlier of (i) thirty (30) days after written notice thereof is given by the
Company to Parent or (ii) two (2) Business Days prior to the Outside Date; provided that the Company shall not have the right to terminate this Agreement pursuant to this Section 7.1(d)(i) if it is then in material
breach of any of its representations, warranties, covenants or agreements set forth in this Agreement such that any condition set forth in Section 6.2(a) or Section 6.2(b) would not be satisfied if it were to be measured as
of the time of such breach; or
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(ii) prior to obtaining the Company Stockholder Approval, in order to enter into
an Alternative Acquisition Agreement with respect to an Acquisition Proposal in compliance with Section 5.3(e) (after having complied with Section 5.3 in respect of such Acquisition Proposal, including
Section 5.3(f)); provided that the Company enters such Alternative Acquisition Agreement substantially concurrently with the termination of this Agreement and pays the Termination Fee in accordance with
Section 7.3(b).
The Party desiring to terminate this Agreement pursuant to this Section 7.1 shall give notice of such termination and the
provisions of this Section 7.1 being relied on to terminate this Agreement to the other Parties.
Section 7.2 Effect
of Termination. In the event of termination of this Agreement, this Agreement shall forthwith become void and have no effect, without any liability or obligation on the part of Parent, Merger Sub or the Company, except that the Confidentiality
Agreement and the provisions of this Section 7.2, Section 7.3 (Fees and Expenses), and Article VIII (General Provisions) of this Agreement shall survive the termination hereof. Notwithstanding the
foregoing, nothing contained herein shall relieve any Party hereto of liability for a willful or intentional breach of its covenants or agreements set forth in this Agreement prior to such termination or for fraud.
Section 7.3 Fees and Expenses.
(a) All fees and expenses incurred in connection with this Agreement, the Merger and the other transactions contemplated hereby shall be borne
and timely paid by the Party incurring such fees or expenses, whether or not the Merger is consummated.
(b) In the event that:
(i) (A) an Acquisition Proposal is made directly to the Company’s stockholders or otherwise publicly disclosed (and shall
not have been withdrawn at least two (2) Business Days prior to the Company Stockholders Meeting), and (B) this Agreement is thereafter terminated by the Company or Parent pursuant to Section 7.1(b)(ii) and
(C) concurrently with or within twelve (12) months after the date of any such termination of this Agreement referred to in clause (B), (x) the Company or any of its Subsidiaries enters into a definitive agreement providing for
the consummation of an Acquisition Proposal, (y) the Company Board or any committee thereof recommends that Company stockholders vote in favor of or tender into an Acquisition Proposal that (either within twelve (12) months after the
termination of this Agreement or afterwards) is subsequently consummated or (z) any Acquisition Proposal is consummated, the Company shall pay to Parent or its designee by wire transfer of same day funds to the account or accounts designated by
Parent or such designee the Termination Fee concurrently with the earlier of the entry into such definitive agreement with respect to, or consummation of, such Acquisition Proposal;
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(ii) (A) an Acquisition Proposal is made directly to the Company’s
stockholders or otherwise publicly disclosed or otherwise communicated to the Company, the Company Board or any committee thereof (and shall not have been withdrawn prior to the termination of this Agreement), and (B) this Agreement is
thereafter terminated by the Company or Parent pursuant to Section 7.1(b)(iii), and (C) concurrently with or within twelve (12) months after the date of any such termination of this Agreement referred to in clause (B), (x)
the Company or any of its Subsidiaries enters into a definitive agreement providing for the consummation of an Acquisition Proposal, (y) the Company Board recommends that Company stockholders vote in favor of or tender into an Acquisition
Proposal that (either within twelve (12) months after the termination of this Agreement or afterwards) is subsequently consummated or (z) any Acquisition Proposal is consummated, the Company shall pay to Parent or its designee by wire
transfer of same day funds to the account or accounts designated by Parent or such designee the Termination Fee concurrently with the earlier of the entry into such definitive agreement with respect to, or consummation of, such Acquisition Proposal;
(iii) this Agreement is terminated by Parent pursuant to Section 7.1(c)(ii), the Company shall pay to Parent
or its designee by wire transfer of same day funds to the account or accounts designated by Parent or such designee the Termination Fee within two (2) Business Days after such termination; and
(iv) this Agreement is terminated by the Company pursuant to Section 7.1(d)(ii), the Company shall pay to Parent or
its designee by wire transfer of same day funds to the account or accounts designated by Parent or such designee the Termination Fee prior to or concurrently with, and as a condition to, such termination;
it being understood that in no event shall the Company be required to pay the Termination Fee on more than one occasion.
(c) For purposes of this Section 7.3:
(i) “Acquisition Proposal”, solely as used in Section 7.3(b)(i) and Section 7.3(b)(ii)
shall have the meaning ascribed thereto in Section 5.3(i)(ii), except that references in Section 5.3(i)(ii) to “fifteen percent (15%)” shall be replaced by “fifty percent (50%)” and references to
“ninety percent (90%)” shall be replaced by references to “fifty percent (50%)”.
(ii)
“Termination Fee” means an amount equal to $28,313,000, except that in the event that this Agreement is validly terminated:
(A) by the Company pursuant to and in accordance with Section 7.1(d)(ii) at or before 11:59 p.m., Chicago Time on
August 12, 2015 (the “Tier 1 Fee Deadline”) in order to enter into an Alternative Acquisition Agreement with respect to an Acquisition Proposal that the Company Board has determined is a Superior Proposal;
(B) by the Company pursuant to and in accordance with Section 7.1(d)(ii) after the Tier 1 Fee Deadline in order to
enter into, within twenty-four (24) hours
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after the end of the applicable Notice Period (as such Notice Period may have been extended), an Alternative Acquisition Agreement with a Person with respect to an Acquisition Proposal that
(1) the Company Board has determined is a Superior Proposal, (2) was made by such Person or its Affiliate prior to the Tier 1 Fee Deadline (with a Notice of Superior Proposal in respect thereof delivered to Parent prior to the Tier 1 Fee
Deadline), (3) would have been entered into by the Company with such Person or its Affiliate prior to the Tier 1 Fee Deadline but for the Company’s obligation to comply with Section 5.3(f) (without prejudice to any changes made
to such Acquisition Proposal (or the related Alternative Acquisition Agreement) after the Tier 1 Fee Deadline in response to counterproposals made by Parent to the Company in connection with the process set forth in Section 5.3(f)) and
(4) is on the terms and conditions last notified to Parent in a Notice of Superior Proposal (or Superior Proposal Change Notice) with respect to such Acquisition Proposal; or
(C) by Parent pursuant to and in accordance with Section 7.1(c)(ii) in connection with an Adverse Recommendation
Change effected by the Company Board pursuant to and in accordance with Section 5.3(e)(i) at or before the Tier 1 Fee Deadline in connection with a Superior Proposal,
then the “Termination Fee” shall mean a cash amount equal to $14,156,000.
(d) Each of the Parties hereto acknowledges that the agreements contained in this Section 7.3 are an integral part of the
transactions contemplated by this Agreement, and that, without these agreements, Parent and Merger Sub would not enter into this Agreement. Accordingly, if the Company fails promptly to pay the amounts due pursuant to this Section 7.3,
and, in order to obtain such payment, Parent or Merger Sub commences a suit that results in a judgment against the Company for all or a portion of the Termination Fee, the Company shall pay to Parent or Merger Sub interest on the amount of the
Termination Fee from the date such payment was required to be made until the date of payment at a rate per annum equal to the prime rate in effect on the date such payment was required to be made (as set forth in The Wall Street Journal) plus
two percent (2%). Upon termination of this Agreement in accordance with its terms, Parent’s right, if any, to receive the Termination Fee pursuant to Section 7.3(b) and the amounts described in the second sentence of this
Section 7.3(d) shall be the sole and exclusive remedy of Parent, Merger Sub and their respective Affiliates against the Company, its Subsidiaries and any of their respective former, current or future stockholders, directors, officers,
Affiliates, agents or other Representatives for any loss suffered as a result of any breach of any representation, warranty, covenant or agreement in this Agreement or the failure of the Merger or the other transactions contemplated by this
Agreement to be consummated, and upon payment of such Termination Fee and any applicable amount described in the second sentence of this Section 7.3(d), none of the Company, its Subsidiaries or any of their respective former, current or
future stockholders, directors, officers, Affiliates, agents or other Representatives shall have any further liability or obligation relating to or arising out of this Agreement or the Merger or the other transactions contemplated by this Agreement;
provided that, nothing in this Section 7.3(d) shall relieve any Person from liability for willful or intentional breach of its covenants or agreements set forth in this Agreement prior to such termination or for fraud. In no event
shall the Company be required to pay the Termination Fee more than once.
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Section 7.4 Amendment or Supplement. This Agreement may be amended, modified or
supplemented by the Parties hereto at any time prior to the Effective Time, whether before or after the Company Stockholder Approval has been obtained; provided, however, that (i) any such amendment, modification or supplement
shall be in a writing specifically designated as an amendment hereto and signed on behalf of each of the Parties and (ii) after the Company Stockholder Approval has been obtained, no amendment shall be made that pursuant to applicable Law
requires further approval or adoption by the stockholders of the Company without such further approval or adoption.
Section 7.5
Extension of Time; Waiver. At any time prior to the Effective Time, the Parties may (by action taken or authorized by their respective boards of directors, if required), to the extent permitted by applicable Law, (a) extend the time for
the performance of any of the obligations or acts of the other Party or Parties hereto, as applicable, (b) waive any inaccuracies in the representations and warranties of the other Party or Parties set forth in this Agreement or any document
delivered pursuant hereto or (c) subject to applicable Law, waive compliance with any of the agreements or conditions of the other Party or Parties contained herein; provided, however, that after the Company Stockholder Approval
has been obtained, no waiver may be made that pursuant to applicable Law requires further approval or adoption by the stockholders of the Company without such further approval or adoption. Any agreement on the part of a Party to any such waiver
shall be valid only if set forth in a written instrument executed and delivered by a duly authorized officer on behalf of such Party or Parties, as applicable. No failure or delay of any Party in exercising any right or remedy hereunder shall
operate as a waiver thereof, nor shall any single or partial exercise of any such right or power, or any abandonment or discontinuance of steps to enforce such right or power, or any course of conduct, preclude any other or further exercise thereof
or the exercise of any other right or power. Except as otherwise provided herein, the rights and remedies of the Parties hereunder are cumulative and are not exclusive of any rights or remedies which they would otherwise have hereunder.
ARTICLE VIII
GENERAL
PROVISIONS
Section 8.1 Survival. This Article VIII and the agreements of the Company, Parent and Merger Sub
contained in Article II and Sections 5.7 (Employee Benefits Matters) and 5.9 (Indemnification, Exculpation and Insurance) shall survive the consummation of the Merger. Except as set forth in the immediately
preceding sentence, none of the representations, warranties, covenants or agreements in this Agreement or in any instrument delivered pursuant to this Agreement shall survive the Effective Time, other than those covenants or agreements of the
Parties which by their terms apply, or are to be performed as a whole or in part, after the Effective Time.
Section 8.2
Notices. All notices and other communications hereunder shall be in writing and shall be deemed duly given (a) on the date of delivery if delivered personally, or if by facsimile or e-mail, upon written confirmation of receipt by
facsimile or e-mail, (excluding out-of-office replies) (b) on the first (1st) Business Day following the date of dispatch if delivered utilizing a next-day service by a recognized
next-day courier or (c) on the earlier of confirmed receipt or the third (3rd) Business Day following the date of mailing if delivered by registered or
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certified mail, return receipt requested, postage prepaid. All notices hereunder shall be delivered to the addresses set forth below, or pursuant to such other instructions as may be designated
in writing by the Party to receive such notice:
| |
(i) |
if to Parent, Merger Sub or the Surviving Corporation, to: |
BorgWarner Inc.
3850 Hamlin Road
Auburn Hills,
Michigan 48326
Attention: John J. Gasparovic
Email: jgasparovic@borgwarner.com
Facsimile: (248) 754-0888
with a copy (which shall not constitute notice) to:
Sidley Austin LLP
One South
Dearborn Street
Chicago, Illinois 60603
Attention: Brian J. Fahrney
Scott R.
Williams
Facsimile: (312) 853-7036
Email: bfahrney@sidley.com
swilliams@sidley.com
| |
(ii) |
if to the Company, to: |
Remy International, Inc.
600 Corporation Drive
Pendleton, Indiana 46064
Attention: John J. Pittas, President and CEO
David G. Krall,
Senior Vice President & General Counsel
Email: pittas.jay@remyinc.com
krall.david@remyinc.com
Facsimile: (765) 221-6175
with a copy (which shall not constitute notice) to:
Sullivan & Cromwell LLP
125 Broad Street
New York, New
York 10004
Attention: George J. Sampas
Facsimile: (212) 291-9131
Email: sampasg@sullcrom.com
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Section 8.3 Certain Definitions. For purposes of this Agreement:
“Action” means any civil, criminal or administrative suit, claim, action, proceeding, arbitration or disclosed investigation.
“Affiliate” of any Person means any other Person that, at the time of determination, directly, or indirectly through one
or more intermediaries, controls, is controlled by or is under common control with, such first Person.
“Business Day”
means any day other than a Saturday, a Sunday or a day on which banks in New York, New York are authorized or required by Law or executive order to be closed.
“control” (including the terms “controlled,” “controlled by” and “under common control with”)
means the possession, directly or indirectly, of the power to direct or cause the direction of the management or policies of a person, whether through the ownership of voting securities, by Contract or otherwise.
“Copyrights” means all registered and unregistered copyrights in both published works and unpublished works of authorship.
“Credit Agreements” collectively means: (i) the Revolving Credit Facility; (ii) the Term Loan Facility;
(iii) Credit Transactions Agreement dated June 18, 2015, as amended June 25, 2015, by and between Remy Korea Limited, as Borrower and Korea Exchange Bank, as Lender; (iv) Amendment to the Credit Transactions Agreement dated
June 25, 2015, by and between Remy Korea Limited, as Borrower, and Nonghyup Bank, as Lender; (v) Amendment to the Credit Transactions Agreement by and between Remy Korea Limited, as Borrower, and Shinhan Bank, as Lender;
(vi) Revolving Credit Facility Agreement, dated May 28, 2015, by and between Remy Electric (Wuhan) and Remy Electricals Hubei Co, Ltd., as Borrower, and Bank of America, N.A., Shanghai Branch, as Lender; (vi) General Entrusted Loan
Borrowing Contract dated as of January 13, 2014, by and among Remy Electricals Hubei Co, Ltd., as Loan Principal, Industrial and Commercial Bank of China (Jingzhou Huitong Branch), as Loan Agent, and Remy Electric (Wuhan) Limited, as Borrower
and (vii) Revolving Credit Agreement, dated April 25, 2014, as amended April 29, 2015, by and between Remy Automotive Hungary Kft., as Borrower, and Raiffeisen Bank Zrt., as Lender.
“Data Room” means the electronic documentation site established on behalf of the Company by Merrill Corporation, as it exists
at 7:00 p.m. (Eastern time) on the day immediately before the execution of this Agreement (an electronic copy of which shall be supplied to Parent contemporaneously with or as promptly as practicable after the execution of this Agreement).
“Distributing” means Fidelity National Financial, Inc.
“Domain Names” means internet domain names.
“ERISA Affiliate” means any trade or business that together with the Company or any of its Affiliates is considered a single
employer pursuant to Section 414(b), (c), (m) or (o) of the Code.
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“Government Contract” means any Contract between the Company or any of its
Subsidiaries on the one hand, and any Governmental Entity (or a contractor or subcontractor to a Governmental Entity, in its capacity as such) on the other hand.
“Intellectual Property” means collectively Patents, Trademarks, Domain Names, Copyrights and Trade Secrets.
“knowledge of the Company” means the actual present knowledge of the individuals set forth on Section 8.3 of the Company
Disclosure Letter.
“Material Adverse Effect” means any condition, event, change, circumstance or effect that has a
material adverse effect on the business, properties, assets, financial condition or results of operations of the Company and its Subsidiaries, taken as a whole; provided, however, that none of the following shall be taken into account
in determining whether there has been, is or would be a Material Adverse Effect:
(1) changes, trends or developments
generally affecting manufacturers of aftermarket automotive parts, light duty vehicle original equipment or commercial vehicle original equipment;
(2) changes in global, national or regional economic, business, regulatory, legislative, political, or market conditions or in
national or global financial markets;
(3) any geopolitical conditions, disease, the outbreak or escalation of
hostilities, an act of war (whether or not declared), sabotage, terrorism, civil disorder, military actions or the escalation thereof;
(4) changes or proposed changes in GAAP or in Laws applicable to the Company or any of its Subsidiaries;
(5) any decline in the market price or change in the trading volume of the Shares on the NASDAQ Global Select Market
(provided that the exception in this clause (5) shall not prevent or otherwise affect a determination that any condition, event, change, circumstance or effect underlying such decline has resulted in or contributed to a Material
Adverse Effect);
(6) any failure, in and of itself, by the Company or any of its Subsidiaries to meet any internal or
published projections, forecasts, estimates or predictions in respect of revenues, earnings or other financial or operating metrics for any period (provided that the exception in this clause (6) shall not prevent or otherwise
affect a determination that any condition, event, change, circumstance or effect underlying such failure has resulted in or contributed to a Material Adverse Effect, including adverse developments with respect to customers (to the extent such
adverse developments with respect to customers are not otherwise excluded by any of clause (1) through clause (5) or clause (7) through clause (10) of this definition of “Material Adverse Effect” from being taken into
account in determining whether a Material Adverse Effect has or would reasonably be expected to occur));
67
(7) the execution and delivery of this Agreement, the performance by any Party of
its obligations hereunder (other than pursuant to Section 5.1(a)) or the public announcement or pendency of the Merger, including the impact thereof on the relationships, contractual or otherwise, of the Company or any of its
Subsidiaries with its customers, employees, or suppliers, or with any other third party; provided, that the exceptions set forth in this clause (7) shall not apply to the use of the term “Material Adverse Effect”
in Section 3.4 (or, solely as it relates to matters otherwise covered by Section 3.4, Section 6.2(a)(iv));
(8) any litigation brought by or on behalf of any current or former Company securityholder (in its capacity as such) arising
from allegations of any breach of fiduciary duty or violation of Law relating to this Agreement or the Merger;
(9) any
change resulting from or arising out of a hurricane, earthquake, tornado, flood, or other weather-related condition or natural disaster; or
(10) (x) any action required to be taken (or required not to be taken) pursuant to this Agreement (other than pursuant to
Section 5.1(a)); provided, that the exceptions set forth in this clause (10)(x) shall not apply to the use of the term “Material Adverse Effect” in Section 3.4 (or, solely as it relates to
matters otherwise covered by Section 3.4, Section 6.2(a)(iv)), or (y) taken at the request or instruction, or with the consent, of Parent or Merger Sub.
except, in the case of any of clauses (1), (2), (3), (4) or (9), to the extent such condition, event, change,
circumstance or effect has a disproportionate adverse effect on the Company and its Subsidiaries, taken as a whole, relative to the adverse effect that such condition, event, change, circumstance or effect has on other companies primarily engaged in
the manufacture of the applicable of aftermarket automotive parts, light duty vehicle original equipment or commercial vehicle original equipment (in which case such condition, event, change, circumstance or effect shall be taken into account in
determining whether there has been a Material Adverse Effect solely to the extent of such disproportionate adverse effect).
“Owned Intellectual Property” means Intellectual Property owned by the Company or any of its Subsidiaries.
“Patents” means all patents, patent applications, and all related continuations, continuations-in-part, divisions, reissues,
re-examinations, substitutions, and extensions thereof.
“Person” means an individual, corporation, partnership, limited
liability company, association, trust or other entity or organization, including any Governmental Entity.
“Representative” means, with respect to any Person, the officers, directors, employees, investment bankers, financial
advisors, attorneys, accountants or other advisors, agents and representatives of such Persons.
“Significant Subsidiary”
means a Subsidiary of the Company that would constitute a “significant subsidiary” within the meaning of Rule 1-02 of Regulation S-X of the SEC.
68
“Subsidiary” means, with respect to any Person, any other Person of which stock
or other equity interests having ordinary voting power to elect more than fifty percent (50%) of the board of directors or other governing body are owned, directly or indirectly, by: (i) such first Person, (ii) such first Person and
one or more of its Subsidiaries, or (iii) one or more Subsidiaries of such first Person.
“Trade Secrets” means
trade secrets, know-how, customer lists, technical information, invention disclosures, research and development, data, processes, formulas, algorithms, methods, trading systems, processes and technology, each to the extent protectable as a trade
secret pursuant to applicable Law.
“Trademarks” means trademarks, service marks, trade names and other similar
designations of source or origin, together with the goodwill symbolized by any of the foregoing, and registrations thereof and applications therefor.
Section 8.4 Interpretation. When a reference is made in this Agreement to a Section, Article or Exhibit, such reference shall be
to a Section, Article or Exhibit of this Agreement unless otherwise indicated. The table of contents and headings contained in this Agreement or in any Exhibit are for convenience of reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement. All words used in this Agreement will be construed to be of such gender or number as the circumstances require. Any capitalized terms used in any Exhibit but not otherwise defined therein shall have the
meaning set forth in this Agreement. All Exhibits annexed hereto or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth herein. The words “include,” “includes” and
“including” and words of similar import when used in this Agreement will mean “include, without limitation,” “includes, without limitation” or “including, without limitation,”
unless otherwise specified. The word “or” shall not be exclusive. The words “hereof”, “herein”, and “hereunder” and words of similar import, when used in this Agreement, shall refer
to this Agreement as a whole and not to any particular provision of this Agreement. The term “made available” (or words of similar import) in respect of information made available (or words of similar import) to or by any of the Parties,
means information made available to or (as applicable) by such Person physically, electronically or otherwise, including through the Data Room; provided, that the use of such words in Article III or Section 5.1 with respect to
information made available by the Company or any of its Subsidiaries to Parent or its Subsidiaries shall refer only to information made available through (a) the Data Room or (b) in the Publicly Available Company SEC Documents.
Section 8.5 Entire Agreement. This Agreement (including the Exhibits hereto), the Company Disclosure Letter and the
Confidentiality Agreement constitute the entire agreement of the Parties with respect to the subject matter hereof and thereof, and supersede all prior written agreements, arrangements, communications and understandings and all prior and
contemporaneous oral agreements, arrangements, communications and understandings among the Parties with respect to the subject matter hereof and thereof (except that the Confidentiality Agreement shall be deemed amended as necessary so that until
the termination of this Agreement in accordance with Section 7.1 hereof, Parent, Merger Sub and the Company shall be permitted to take the actions expressly required by this Agreement). The letter agreement, dated June 7, 2015 and
amended on June 23, 2015, between Parent and the Company, is hereby terminated. EACH PARTY HERETO AGREES THAT, EXCEPT FOR THE REPRESENTATIONS AND
69
WARRANTIES CONTAINED IN THIS AGREEMENT, NEITHER PARENT AND MERGER SUB NOR THE COMPANY MAKES OR RELIES ON ANY OTHER REPRESENTATIONS, WARRANTIES OR (OTHER THAN FOR CLAIMS WITH RESPECT TO FRAUD OR
INTENTIONAL MISREPRESENTATION) INDUCEMENTS, AND EACH HEREBY DISCLAIMS ANY OTHER REPRESENTATIONS, WARRANTIES OR (OTHER THAN FOR CLAIMS WITH RESPECT TO FRAUD OR INTENTIONAL MISREPRESENTATION) INDUCEMENTS, EXPRESS OR IMPLIED, AS TO THE ACCURACY OR
COMPLETENESS OF ANY OTHER INFORMATION, MADE BY, OR MADE AVAILABLE BY, ITSELF OR ANY OF ITS REPRESENTATIVES, WITH RESPECT TO, OR IN CONNECTION WITH, THE NEGOTIATION, EXECUTION OR DELIVERY OF THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY,
NOTWITHSTANDING THE DELIVERY OR DISCLOSURE TO THE OTHER OR THE OTHER’S REPRESENTATIVES OF ANY DOCUMENTATION OR OTHER INFORMATION WITH RESPECT TO ANY ONE OR MORE OF THE FOREGOING.
Section 8.6 Parties in Interest. Except as provided in Section 5.9 (Indemnification, Exculpation and
Insurance), Parent and the Company hereby agree that their respective representations, warranties and covenants set forth in this Agreement are solely for the benefit of the other Parties, in accordance with and subject to the terms of this
Agreement, and this Agreement is not intended to, and does not, confer upon any Person other than the Parties any rights or remedies hereunder, including the right to rely upon the representations and warranties set forth in this Agreement. The
Parties further agree that the rights of third party beneficiaries under Section 5.9 shall not arise unless and until the Effective Time occurs. The representations and warranties in this Agreement are the product of negotiations among
the Parties and are for the sole benefit of the Parties. Any inaccuracies in such representations and warranties are subject to waiver by the Parties in accordance with Section 8.13 without notice or liability to any other Person.
Persons other than the Parties may not rely upon the representations and warranties in this Agreement as characterizations of actual facts or circumstances as of the date of this Agreement or as of any other date.
Section 8.7 Obligations of Parent and of the Company. Whenever this Agreement requires a Subsidiary of Parent to take any action,
such requirement shall be deemed to include an undertaking on the part of Parent to cause such Subsidiary to take such action. Whenever this Agreement requires a Subsidiary of the Company to take any action, such requirement shall be deemed to
include an undertaking on the part of the Company to cause such Subsidiary to take such action and, after the Effective Time, on the part of the Surviving Corporation to cause such Subsidiary to take such action.
Section 8.8 Governing Law. THIS AGREEMENT AND ALL DISPUTES OR CONTROVERSIES ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE
TRANSACTIONS CONTEMPLATED HEREBY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE INTERNAL LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO THE CONFLICTS OF LAW PRINCIPLES THEREOF TO THE EXTENT THAT SUCH PRINCIPLES WOULD REQUIRE
APPLICATION OF THE LAWS OF ANOTHER JURISDICTION.
70
Section 8.9 Submission to Jurisdiction. Each of the Parties irrevocably agrees that
any legal action or proceeding arising out of or relating to this Agreement or the transaction contemplated hereby brought by any other Party or its successors or assigns shall be brought and determined in the Delaware Court of Chancery and any
state appellate court therefrom within the State of Delaware (unless the Delaware Court of Chancery shall decline to accept jurisdiction over a particular matter, in which case, in any Delaware state or federal court within the State of Delaware),
and each of the Parties hereby irrevocably submits to the exclusive personal jurisdiction of the aforesaid courts for itself and with respect to its property, generally and unconditionally, with regard to the action or proceeding arising out of or
relating to this Agreement and the transactions contemplated hereby. Each of the Parties agrees not to commence any action, suit or proceeding relating to this Agreement or the transaction contemplated hereby in any court other than the courts of
the State of Delaware, as described above, other than actions in any court of competent jurisdiction to enforce any judgment, decree or award rendered by such court. Each of the Parties further agrees that notice provided in accordance with
Section 8.2 or in such other manner as may be permitted by Law shall constitute sufficient service of process and the Parties further waive any argument that such service is insufficient. Each of the parties hereby irrevocably and
unconditionally waives, and agrees not to assert, by way of motion or as a defense, counterclaim or otherwise, in any action or proceeding arising out of or relating to this Agreement or the transactions contemplated hereby, (a) any claim that
it is not personally subject to the jurisdiction of the courts of the State of Delaware, as described above, for any reason, (b) that it or its property is exempt or immune from jurisdiction of any such court or from any legal process commenced
in such courts (whether through service of notice, attachment prior to judgment, attachment in aid of execution of judgment, execution of judgment or otherwise) and (c) that (i) the suit, action or proceeding in any such court is brought
in an inconvenient forum, (ii) the venue of such suit, action or proceeding is improper or (iii) this Agreement, or the subject matter hereof, may not be enforced in or by such courts.
Section 8.10 Assignment; Successors. Neither this Agreement nor any of the rights, interests or obligations under this Agreement
may be assigned or delegated, as a whole or in part, by operation of law or otherwise, by any Party without the prior written consent of the other Parties, and any such assignment without such prior written consent shall be null and void;
provided, however, that Merger Sub may assign in its sole discretion and without the consent of any other Party, any or all (but not less than all) of its rights and interests, and delegate all but not less than all of its and
obligations, under this Agreement to any direct or indirect wholly owned Subsidiary of Parent that is a Delaware corporation by providing written notice thereof to the Company; provided that (i) any such assignment shall not prevent, materially
delay or impede the consummation of the Merger or otherwise materially impede the rights of the stockholders of the Company under this Agreement and (ii) no such assignment shall relieve Parent or Merger Sub of its obligations hereunder and
(iii) such assignment shall not result in a delay of the date of the Company Stockholders Meeting. Subject to the preceding sentence, this Agreement will be binding upon, inure to the benefit of and be enforceable by the Parties and their
respective successors and assigns.
Section 8.11 Enforcement. The Parties agree that irreparable damage would occur if any of
the provisions contained of this Agreement were not performed in accordance with their specific terms or were otherwise breached. Accordingly, the Parties agree that each Party,
71
without prejudice to any rights and remedies otherwise available, shall be entitled to specific performance of the terms hereof, including an injunction or injunctions to prevent breaches of this
Agreement without proof of actual damages. Each of the Parties hereby waives any requirement under any law to post security as a prerequisite to obtaining equitable relief. In the event that any action is brought in equity to enforce the provisions
of this Agreement, no Party shall allege, and each Party hereby waives the defense or counterclaim, that there is an adequate remedy at law.
Section 8.12 Currency. All references to “dollars” or “$” or “US$” in this Agreement refer to United
States dollars, which is the currency used for all purposes in this Agreement.
Section 8.13 Severability. Whenever possible,
each provision or portion of any provision of this Agreement shall be interpreted in such manner as to be effective and valid under applicable Law, but if any provision or portion of any provision of this Agreement is held to be invalid, illegal or
unenforceable in any respect under any applicable Law or rule in any jurisdiction, (a) a suitable and equitable provision shall be substituted therefor in order to carry out, so far as may be valid and enforceable, the intent and purpose of
such invalid or unenforceable provision and (b) the remainder of this Agreement and the application of such provision to other Persons or circumstances shall not be affected by such invalidity or unenforceability, nor shall such invalidity or
unenforceability affect the validity or enforceability of such provision, or the application of such provision, in any other jurisdiction.
Section 8.14 Waiver of Jury Trial. EACH OF THE PARTIES TO THIS AGREEMENT HEREBY IRREVOCABLY WAIVES ALL RIGHT TO A TRIAL BY JURY IN
ANY ACTION, PROCEEDING OR COUNTERCLAIM ARISING OUT OF OR RELATING TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.
Section 8.15 Counterparts. This Agreement may be executed in two (2) or more counterparts, all of which shall be considered
one and the same instrument and shall become effective when one (1) or more counterparts have been signed by each of the parties and delivered to the other parties.
Section 8.16 Electronic Signature. This Agreement may be executed by facsimile signature or electronically scanned signature and
such signatures shall constitute an original for all purposes.
Section 8.17 No Presumption Against Drafting Party. Each of
Parent, Merger Sub and the Company acknowledges that each Party to this Agreement has been represented by counsel in connection with this Agreement and the transactions contemplated by this Agreement. Accordingly, any rule of law or any legal
decision that would require interpretation of any claimed ambiguities in this Agreement against the drafting Party has no application and is hereby expressly waived.
Section 8.18 Disclosure Letters. The Company Disclosure Letter is not intended to constitute, and shall not be construed as
constituting, representations or warranties of the Company, except and solely to the extent that a representation or warranty set forth in Article III of this Agreement specifically states that a true, complete or accurate list of a particular item
is
72
set forth on a particular section of the Company Disclosure Letter. The fact that any item or other information is disclosed in the Company Disclosure Letter shall not be construed to mean that
such information is required to be disclosed by this Agreement. Inclusion of any item or other matter in the Company Disclosure Letter shall not be construed as an admission or indication that such item or other matter is or is not material or that
such item has had or would reasonably be expected to have a Material Adverse Effect. Headings in the Company Disclosure Letter are inserted for reference purposes and for convenience of the reader only, and shall not affect the interpretation
thereof or of this Agreement. Nothing contained in the Company Disclosure Letter shall be construed as an admission of liability or responsibility in connection with any pending, threatened or future matter or proceeding.
[Signature page follows.]
73
IN WITNESS WHEREOF, the Parties have caused this Agreement to be executed as of the date first
written above by their respective officers thereunto duly authorized.
|
|
|
| BORGWARNER INC. |
|
|
| By: |
|
/s/ Ronald T. Hundzinski |
|
|
Name: Ronald T. Hundzinski |
|
|
Title: Vice President and Chief Financial Officer |
|
| BAND MERGER SUB, INC. |
|
|
| By: |
|
/s/ Ronald T. Hundzinski |
|
|
Name: Ronald T. Hundzinski |
|
|
Title: President |
|
| REMY INTERNATIONAL, INC. |
|
|
| By: |
|
/s/ John H. Weber |
|
|
Name: John H. Weber |
|
|
Title: Chairman |
[Signature Page
to Merger Agreement]
ANNEX I
INDEX OF DEFINED TERMS
|
|
|
|
|
| Definition |
|
Location |
|
| Acceptable Confidentiality Agreement |
|
|
5.3(i)(i) |
|
| Acquired Companies |
|
|
3.1(a) |
|
| Acquired Company |
|
|
3.1(a) |
|
| Acquisition Proposal |
|
|
5.3(i)(ii), 7.3(c)(i) |
|
| Action |
|
|
8.3 |
|
| Adverse Recommendation Change |
|
|
5.3(d)(i) |
|
| Affiliate |
|
|
8.3 |
|
| Agreement |
|
|
Preamble |
|
| Alternative Acquisition Agreement |
|
|
5.3(d)(ii) |
|
| Anticorruption Laws |
|
|
3.10(e) |
|
| Antitrust Law |
|
|
5.6(e) |
|
| Appraisal Rights |
|
|
2.2(i) |
|
| Book-Entry Shares |
|
|
2.1(c) |
|
| Business Day |
|
|
8.3 |
|
| Certificate |
|
|
2.1(c) |
|
| Certificate of Merger |
|
|
1.2 |
|
| Closing |
|
|
1.3 |
|
| Closing Date |
|
|
1.3 |
|
| Code |
|
|
2.2(h) |
|
| Company |
|
|
Preamble |
|
| Company Board |
|
|
Recitals |
|
| Company 401(k) Plans |
|
|
5.7(c) |
|
| Company Constituent Documents |
|
|
3.1(b) |
|
| Company Determination |
|
|
3.3(b) |
|
| Company Disclosure Letter |
|
|
Article III |
|
| Company Equity Awards |
|
|
2.1(d)(v) |
|
| Company Equity Plan |
|
|
2.1(d)(i) |
|
| Company ESPP |
|
|
2.1(d)(vi) |
|
| Company Phantom Award |
|
|
2.1(d)(iv) |
|
| Company Plan |
|
|
3.11(a) |
|
| Company Recommendation |
|
|
3.3(b) |
|
| Company SAR |
|
|
2.1(d)(ii) |
|
| Company SEC Documents |
|
|
3.5(a) |
|
| Company Stockholder Approval |
|
|
3.3(a) |
|
| Company Stockholders Meeting |
|
|
5.4(d) |
|
| Company Stock Equivalents |
|
|
3.2(b) |
|
| Company Stock Options |
|
|
2.1(d)(i) |
|
| Company Support Agreement |
|
|
5.1(b)(vii) |
|
| Company Voting Debt |
|
|
3.2(b) |
|
| Confidentiality Agreement |
|
|
5.5(b) |
|
| Continuing Employee |
|
|
5.7(a) |
|
| Contract |
|
|
3.15(b) |
|
INDEX OF DEFINED TERMS
(Continued)
|
|
|
|
|
| control |
|
|
8.3 |
|
| Controlled |
|
|
3.14(j) |
|
| controlled |
|
|
8.3 |
|
| controlled by |
|
|
8.3 |
|
| Copyrights |
|
|
8.3 |
|
| Credit Agreements |
|
|
8.3 |
|
| D&O Insurance |
|
|
5.9(c) |
|
| Data Room |
|
|
8.3 |
|
| DGCL |
|
|
Recitals |
|
| Dissenting Shares |
|
|
2.2(i) |
|
| Distributing |
|
|
8.3 |
|
| Domain Names |
|
|
8.3 |
|
| DOJ |
|
|
3.10(d) |
|
| Effective Time |
|
|
1.2 |
|
| Environmental Laws |
|
|
3.13(b)(i) |
|
| Environmental Permits |
|
|
3.13(b)(ii) |
|
| ERISA |
|
|
3.11(a) |
|
| ERISA Affiliate |
|
|
8.3 |
|
| ERISA Plan |
|
|
3.11(b)(ii) |
|
| Exchange Act |
|
|
3.4(b) |
|
| Excluded Shares |
|
|
2.1(b) |
|
| Foreign Company Plan |
|
|
3.11(b)(i) |
|
| GAAP |
|
|
3.5(b) |
|
| Government Antitrust Entity |
|
|
5.6(a) |
|
| Government Contract |
|
|
8.3 |
|
| Governmental Entity |
|
|
3.4(b) |
|
| H Partners Group |
|
|
Recitals |
|
| HSR Act |
|
|
3.4(b) |
|
| Indemnified Parties |
|
|
5.9(a) |
|
| Intellectual Property |
|
|
8.3 |
|
| IRS |
|
|
3.11(a) |
|
| knowledge of the Company |
|
|
8.3 |
|
| Law |
|
|
3.4(a) |
|
| Liens |
|
|
3.2(a) |
|
| Material Adverse Effect |
|
|
8.3 |
|
| Material Contract |
|
|
3.15(a) |
|
| Material Aftermarket Customer |
|
|
3.19 |
|
| Material OEM Customer |
|
|
3.19 |
|
| Material Supplier |
|
|
3.19 |
|
| Materials of Environmental Concern |
|
|
3.13(b)(iii) |
|
| Merger |
|
|
Recitals |
|
| Merger Sub |
|
|
Preamble |
|
| New Merger Sub |
|
|
3.14(j) |
|
| Notice of Superior Proposal |
|
|
5.3(f)(i) |
|
| Notice Period |
|
|
5.3(f)(ii) |
|
| Old Controlled |
|
|
3.14(j) |
|
INDEX OF DEFINED TERMS
(Continued)
|
|
|
|
|
| Old Merger Sub |
|
|
3.14(j) |
|
| Option Payments |
|
|
2.1(d)(i) |
|
| Outside Date |
|
|
7.1(b)(iii) |
|
| Owned Intellectual Property |
|
|
8.3 |
|
| Owned Real Property |
|
|
3.17(a) |
|
| Parent |
|
|
Preamble |
|
| Parent 401(k) Plan |
|
|
5.7(d) |
|
| Parent Employee Plan |
|
|
5.7(b) |
|
| Parties |
|
|
Preamble |
|
| Patents |
|
|
8.3 |
|
| Paying Agent |
|
|
2.2(a) |
|
| Paying Agent Agreement |
|
|
2.2(a) |
|
| Payment Fund |
|
|
2.2(a) |
|
| PBGC |
|
|
3.11(c) |
|
| Per Share Merger Consideration |
|
|
Recitals |
|
| Pension Plan |
|
|
3.11(a) |
|
| Permits |
|
|
3.10(b) |
|
| Permitted Liens |
|
|
3.17(a) |
|
| Person |
|
|
8.3 |
|
| Phantom Payments |
|
|
2.1(d)(iv) |
|
| Preferred Shares |
|
|
3.2(b) |
|
| Proxy Statement |
|
|
5.4(a) |
|
| Publicly Available Company SEC Documents |
|
|
Art. III |
|
| Real Property Leases |
|
|
3.17(b) |
|
| Representative |
|
|
8.3 |
|
| Restricted Shares |
|
|
2.1(d)(iii) |
|
| Revolving Credit Facility |
|
|
5.6(f) |
|
| SAR Payments |
|
|
2.1(d)(ii) |
|
| SEC |
|
|
3.5(a) |
|
| SEC Clearance |
|
|
5.4(a) |
|
| Significant Subsidiary |
|
|
8.3 |
|
| Securities Act |
|
|
3.5(a) |
|
| Share |
|
|
Recitals |
|
| Specified Date |
|
|
3.2(b) |
|
| SOX |
|
|
3.5(a) |
|
| Spin-Off |
|
|
3.14(j) |
|
| Subsidiary |
|
|
8.3 |
|
| Subsidiary Organizational Documents |
|
|
3.1(b) |
|
| Superior Proposal |
|
|
5.3(i)(iii) |
|
| Superior Proposal Change Notice |
|
|
5.3(f) |
|
| Surviving Corporation |
|
|
1.1(a) |
|
| Takeover Laws |
|
|
3.25 |
|
| Tax |
|
|
3.14(l)(i) |
|
| Taxes |
|
|
3.14(l)(i) |
|
| Tax Matters Agreement |
|
|
3.23 |
|
| Tax Opinion |
|
|
3.23 |
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INDEX OF DEFINED TERMS
(Continued)
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| Tax Return |
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3.14(l)(ii) |
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| Term Loan Facility |
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5.6(f) |
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| Termination Fee |
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7.3(c)(ii) |
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| Tier 1 Fee Deadline |
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7.3(c)(ii) |
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| Trade Secrets |
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8.3 |
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| Trademarks |
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8.3 |
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| under common control with |
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8.3 |
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| Voting Agreement |
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Recitals |
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| WARN |
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3.12(a) |
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EXHIBIT A
AMENDED AND RESTATED
CERTIFICATE
OF INCORPORATION
OF
REMY
INTERNATIONAL, INC.
FIRST: The name of the corporation (which is hereinafter referred to as the “Corporation”) is Remy
International, Inc.
SECOND: The address of the Corporation’s registered office in the State of Delaware is The Corporation Trust
Center, 1209 Orange Street, Wilmington, Delaware 19801, New Castle County. The name of the Corporation’s registered agent at such address is The Corporation Trust Company.
THIRD: The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General
Corporation Law of Delaware (the “DGCL”).
FOURTH: The capital stock of the Corporation shall consist of 2,000 shares of Common
Stock with a par value of $0.01 per share, of which, 1,000 shares shall be Class A Common Stock and 1,000 shares shall be Class B Common Stock. Each share of Common Stock of the Corporation shall entitle the holder thereof to one vote, in
person or by proxy, on each proposition submitted to the stockholders for their vote thereon or their written consent thereto.
FIFTH: In
furtherance and not in limitation of the powers conferred by statute, the Board of Directors is expressly authorized to make, alter or repeal the Bylaws of the Corporation, subject to any specific limitation on such power contained in any Bylaws
adopted by the stockholders. Elections of directors need not be by written ballot unless the Bylaws of the Corporation so provide.
SIXTH:
No person who is or was a director of the Corporation shall be personally liable to the Corporation or any of its stockholders for monetary damages for breach of fiduciary duty as a director, except to the extent such exemption from liability or
limitation thereof is not permitted by the DGCL as the same exists or hereafter may be amended. If the DGCL is hereafter amended to authorize corporate action further limiting or eliminating the liability of directors, then the liability of a
director to the Corporation or its stockholders shall be limited or eliminated to the fullest extent permitted by the DGCL, as so amended. Any repeal or amendment of this Section Six of the Certificate of Incorporation by the stockholders of the
Corporation or by changes in law, or the adoption of any other provision of this Certificate of Incorporation inconsistent with this Section Six will, unless otherwise required by law, be prospective only (except to the extent such amendment or
change in law permits the Corporation to further limit or eliminate the liability of directors) and shall not adversely affect any right or protection of a director of the Corporation existing at the time of such repeal or amendment or adoption of
such inconsistent provision with respect to acts or omissions occurring prior to such repeal or amendment or adoption of such inconsistent provision.
SEVENTH: Each person who is or was made a party or is threatened to be made a party to or is
otherwise involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a “proceeding”), including, without limitation, proceedings by or in the right of
the Corporation to procure a judgment in its favor, by reason of the fact that he or she is or was a director or officer of the Corporation or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a
director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan (hereinafter a “Covered Person”), whether the basis of
such proceeding is alleged action in an official capacity as a director, officer, employee or agent, or in any other capacity while serving as a director, officer, employee or agent, shall be indemnified and held harmless by the Corporation to the
fullest extent authorized or permitted by applicable law, as the same exists or may hereafter be amended, against all expense, liability and loss (including, without limitation, attorneys’ fees, judgments, fines, ERISA excise taxes and
penalties and amounts paid in settlement) reasonably incurred or suffered by such Covered Person in connection with such proceeding, and such right to indemnification shall continue as to a person who has ceased to be a director, officer, employee
or agent and shall inure to the benefit of his or her heirs, executors and administrators; provided, however, that, except for proceedings to enforce rights to indemnification, the Corporation shall indemnify a Covered Person in connection with a
proceeding (or part thereof) initiated by such Covered Person only if such proceeding (or part thereof) was authorized by the Board of Directors. The right to indemnification conferred by this Section Seven shall be a contract right and shall
include the right to be paid by the Corporation the expenses incurred in defending or otherwise participating in any such proceeding in advance of its final disposition. The rights conferred on any Covered Person by this Section Seven shall not be
exclusive of any other rights which any Covered Person may have or hereafter acquire under law, this Certificate of Incorporation, the Bylaws, an agreement, vote of stockholders or disinterested directors, or otherwise. Any repeal or amendment of
this Section Seven by the stockholders of the Corporation or by changes in law, or the adoption of any other provision of this Certificate of Incorporation inconsistent with this Section Seven, will, unless otherwise required by law, be prospective
only (except to the extent such amendment or change in law permits the Corporation to provide broader indemnification rights on a retroactive basis than permitted prior thereto), and will not in any way diminish or adversely affect any right or
protection existing at the time of such repeal or amendment or adoption of such inconsistent provision in respect of any act or omission occurring prior to such repeal or amendment or adoption of such inconsistent provision. This Section Seven shall
not limit the right of the Corporation, to the extent and in the manner authorized or permitted by law, to indemnify and to advance expenses to persons other than Covered Persons.
EIGHTH: The Corporation reserves the right to amend, alter, change or repeal any provision contained in this Certificate of Incorporation, in
the manner now or hereafter prescribed by statute, and all rights conferred upon the stockholders herein are granted subject to this reservation.
2
Exhibit 99.1
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Immediate Release |
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Contact |
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Ken Lamb |
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248.754.0884 |
BORGWARNER ENTERS INTO
AGREEMENT TO ACQUIRE REMY INTERNATIONAL
Combination
enables new and innovative ways to approach engine and drivetrain efficiency
Auburn Hills, Michigan, July 13, 2015 – BorgWarner
announced today that it has entered into a definitive agreement to acquire Remy International, Inc.(Remy), a global market leading producer of rotating electrical components. With key technologies and operations in ten countries on five different
continents, Remy is strongly positioned to benefit from global growth. As of December 31, 2014 the company employed 6,600 people and, for the fiscal year, it generated sales of $1.2 billion.
“We look forward to welcoming Remy’s talented employees to BorgWarner. Their products and capabilities will strengthen
BorgWarner’s position in the rapidly developing powertrain electrification trend,” said James Verrier, President and CEO of BorgWarner. “The acquisition will be another step in executing our plan, to profitably grow revenue to $15
billion by 2020.”
Financial Highlights and Transaction Terms
Under the terms of the agreement, BorgWarner will acquire each of the outstanding shares of Remy for $29.50 in cash, which implies an
enterprise value of Remy of approximately $1.2 billion. BorgWarner has identified purchasing efficiencies, redundant public company expenses, other cost synergies and numerous opportunities to accelerate growth through the combined business. The
transaction is expected to be accretive to earnings in the first year.
The completion of the transaction is subject to certain customary
terms and conditions, including the approval of Remy’s stockholders and antitrust and other regulatory clearances in the United States and abroad. The transaction is expected to close in the fourth quarter of 2015.
BofA Merrill Lynch acted as financial advisor and Sidley Austin LLP provided legal advice to BorgWarner.
-more-
Conference Call
At 9:00 a.m. ET today, a brief conference call concerning the transaction will be webcastat:
http://www.borgwarner.com/en/Investors/default.aspx.
About BorgWarner
BorgWarner Inc. (NYSE: BWA) is a product leader in highly engineered components and systems for powertrains around the world. Operating
manufacturing and technical facilities in 58 locations in 19 countries, the company delivers innovative powertrain solutions to improve fuel economy, reduce emissions and enhance performance. For more information, please visit borgwarner.com.
About Remy International, Inc.
Founded
by the Remy brothers in 1896, Remy International, Inc. (NASDAQ: REMY) is a leading global manufacturer, remanufacturer, and distributor of alternators, starter motors, and electric traction motors for the automotive and commercial vehicle industry,
marketed under the Remy® and Delco Remy® brands. The company also provides multiline products through its subsidiaries. Headquartered
in Pendleton, Indiana, with operations across five continents and ten countries, Remy is a trusted partner to original equipment manufacturers and aftermarket organizations worldwide, delivering creative solutions for today’s vehicle
challenges.
###
Statements contained in
this news release may contain forward-looking statements as contemplated by the 1995 Private Securities Litigation Reform Act that are based on management’s current outlook, expectations, estimates and projections. Words such as
“anticipates,” “believes,” “continues,” “could,” “designed,” “effect,” “estimates,” “evaluates,” “expects,” “forecasts,” “goal,”
“initiative,” “intends,” “outlook,” “plans,” “potential,” “project,” “pursue,” “seek,” “should,” “target,” “when,” “would,”
variations of such words and similar expressions are intended to identify such forward-looking statements. Forward-looking statements are subject to risks and uncertainties, many of which are difficult to predict and generally beyond our control,
that could cause actual results to differ materially from those expressed, projected or implied in or by the forward-looking statements. Such risks and uncertainties include: the failure to complete or receive the anticipated benefits from
BorgWarner’s acquisition of Remy, the possibility that the parties may be unable to successfully integrate Remy’s operations with those of BorgWarner, that such integration may be more difficult, time-consuming or costly than expected,
revenues following the transaction may be lower than expected, customer loss and business disruption (including, without limitation, difficulties in maintaining relationships with employees, customers, or suppliers) may be greater than expected
following the transaction; the retention of key employees at Remy may not be achieved, the conditions to the completion of the transaction may not be satisfied, or the regulatory approvals required for the transaction may not be obtained on the
terms expected or on the anticipated schedule, the failure to obtain Remy stockholder approval in a timely manner or otherwise, fluctuations in domestic or foreign vehicle production, the continued use by original equipment manufacturers of outside
suppliers, fluctuations in demand for vehicles containing our products, changes in general economic conditions, as well as other risks noted reports that we file with the Securities and Exchange Commission, including the Risk Factors identified in
our most recently filed Annual Report on Form 10-K. We do not undertake any obligation to update or announce publicly any updates to or revision to any of the forward-looking statements.
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