AGREEMENT AND PLAN OF MERGER by and among H. J. HEINZ COMPANY, HAWK ACQUISITION HOLDING CORPORATION and HAWK ACQUISITION SUB, INC. Dated as of February 13, 2013

directors of the Surviving Corporation shall be authorized to execute and deliver, in the name and on behalf of either the Company or Merger Sub, all such deeds, bills of sale, assignments and assurances and to take and do, in the name and on behalf of each of such corporations or otherwise, all such other actions and things as may be necessary or desirable to vest, perfect or confirm any and all right, title and interest in, to and under such rights, properties or assets in the Surviving Corporation or otherwise to carry out this Agreement.

the Exchange Fund so as to make all such cash payments under Section 4.01(a) and 4.01(c)(i).

that were outstanding immediately prior to the Effective Time. If, after the Effective Time, any Certificate is presented to the Surviving Corporation, Parent or the Paying Agent for transfer, the holder of such Certificate shall be given a copy of the letter of transmittal referred to in Section 4.02(b) and instructed to comply with the instructions in that letter of transmittal in order to receive the cash to which the holder of such Certificate is entitled pursuant to this Article 4.

with Section 7.01(c)(i)(A) on the Dissenting Shares held by such Dissenting Shareholder with a record date prior to the Effective Time that remain unpaid at the Effective Time), except that each Dissenting Shareholder shall have the right to receive such consideration as may be determined to be due to such Dissenting Shareholder pursuant to the PBCL; provided, however, that each Dissenting Share held by a Dissenting Shareholder who, after the Effective Time, effectively withdraws or loses his or her dissenters rights pursuant to the PBCL, shall be treated as set forth in Section 4.01(c)(i), (ii) or (iii) above, as applicable. The Company shall give Parent (i) prompt notice of any demands for payment of fair value pursuant to the applicable provisions of the PBCL received by the Company, withdrawals of such demands, and any other instruments served pursuant to the PBCL and received by the Company with respect to dissenters rights under the PBCL and (ii) the opportunity to participate in and, after the Closing, direct all negotiations and proceedings with respect to dissenters rights under the PBCL. The Company shall not, except with the prior written consent of Parent, make any payment with respect to any such demands for payment of fair value or offer to settle or settle any such demands.

Time (but in any event no later than three Business Days after the Effective Time), an amount in cash equal to the sum of (x) the product of (i) the Per Share Merger Consideration multiplied by (ii) the total number of Shares subject to such Company RSUs plus (y) the amount of accrued and unpaid dividends thereon, less any required Tax withholdings as provided in Section 4.02(g); provided that payment in respect of Company RSUs that have been deferred will be made in accordance with the terms of such award and the applicable deferral election made by the holder thereof. In the event that the immediate payment of the amounts contemplated above in respect of the Company RSUs would cause an impermissible acceleration event under Section 409A of the Code, such amounts shall become vested at the Effective Time and will be paid at the earliest time such payment would not cause an impermissible acceleration event under Section 409A.

the SEC since January 1, 2011 and at least two Business Days prior to the date of this Agreement (and (i) then only to the extent that the relevance of any disclosed event, item or occurrence in such Company SEC Reports to a matter covered by a representation or warranty set forth in this Article 5 is reasonably apparent as to matters which are a subject of such representation or warranty, (ii) other than any matters required to be disclosed for purposes of Section 5.02 (other than clause (c) thereof) (Capital Structure) and Section 5.18 (Takeover Statutes; Absence of Rights Agreement), which matters shall only be disclosed by specific disclosure in the respective corresponding section of the Company Disclosure Letter, and (iii) without giving effect to any amendment to any such documents filed on or after the date hereof) or (y) the corresponding section or subsections of the disclosure letter delivered by the Company to Parent immediately prior to the execution of this Agreement (the “Company Disclosure Letter”) (it being acknowledged and agreed that disclosure of any event, item or occurrence in any section or subsection of the Company Disclosure Letter shall be deemed disclosed with respect to any other section or subsection of the Company Disclosure Letter only to the extent that the relevance of such disclosed event, item or occurrence to such other section or subsection is reasonably apparent as to matters which are a subject of the corresponding representation or warranty, other than any matters required to be disclosed for purposes of Section 5.02 (other than clause (c) thereof) (Capital Structure) and Section 5.18 (Takeover Statutes; Absence of Rights Agreement), which matters shall only be disclosed by specific disclosure in the respective corresponding section of the Company Disclosure Letter), the Company hereby represents and warrants to Parent and Merger Sub that:

 

Section 5.01. Organization, Good Standing and Qualification. Each of the Company and each of its Subsidiaries is a legal entity duly organized, validly existing and in good standing or is subsisting (with respect to jurisdictions that recognize the concept of good standing or subsisting) 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 presently conducted and is qualified to do business and is in good standing or subsisting (with respect to jurisdictions that recognize the concept of good standing or subsisting) as a foreign corporation or other legal entity in each jurisdiction where the ownership, leasing or operation of its assets or properties or the conduct of its business as presently conducted requires such qualification, except where (i) the failure of any of the Company’s Subsidiaries to be so organized, existing, qualified or in good standing or to have such power or authority, or (ii) the failure of the Company to be so qualified, be in good standing as a foreign corporation or have such authority has not had or would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect. The Company has made available to Parent complete and correct copies of the Company’s articles of incorporation and bylaws, each as amended to the date of this Agreement, and each as so made available is in full force and effect on the date of this Agreement.

Third Cumulative Preferred Stock, $1.70 First Series (the “First Series Preferred Shares”) were issued and outstanding, 1,000 shares of non-voting Third Cumulative Preferred Stock, 6.5% Second Series (the “Second Series Preferred Shares”) were issued and held by HJH One LLC, a Subsidiary of the Company, and 1,000 shares of non-voting Third Cumulative Preferred Stock, 7.65% Fourth Series (the “Fourth Series Preferred Shares”) were issued and held by Promark Brand, a Subsidiary of the Company. All of the outstanding Shares have been duly authorized and are validly issued, fully paid and nonassessable. As of February 12, 2013, other than 850 Shares reserved for issuance under the Company’s 1996 Stock Options Plan as amended and restated effective August 13, 2008 (the “1996 Stock Option Plan”), 164,354 Shares reserved for issuance under the Company’s 2000 Stock Option Plan (as amended and restated effective August 13, 2008 (the “2000 Stock Option Plan”)), 3,324,530 Shares reserved for issuance pursuant to the Company’s Fiscal Year 2003 Stock Plan (as amended and restated, the “2003 Stock Incentive Plan”) and 10,000,000 Shares reserved for issuance pursuant to the Company’s Fiscal Year 2013 Stock Plan (the “2013 Stock Incentive Plan and, collectively with the 2003 Stock Incentive Plan, the GSPP, the Company’s 1996 Stock Option Plan and 2000 Stock Option Plan, the “Stock Plans”), the Company had no Shares reserved for issuance. Upon the issuance of any Shares in accordance with the terms of the Stock Plans, such Shares will be duly authorized, validly issued, fully paid and nonassessable. As of February 12, 2013, (i) other than Shares issuable pursuant to the GSPP, 6,853,716 Shares were subject to outstanding options to purchase Shares (such outstanding options, together with any options to purchase Shares granted after February 12, 2013, under the Stock Plans other than the GSPP, the “Company Stock Options”), (ii) 20,107 Phantom Shares were subject to Phantom Share awards granted under certain compensatory plans applicable to non-U.S. employees (such outstanding Phantom Share awards together with any Phantom Share awards granted after February 12, 2013, the “Company Phantom Shares”) (iii) 2,012,260 Shares were subject to restricted stock unit awards granted under the Stock Plans (such outstanding restricted stock unit awards, together with any restricted stock unit awards granted after February 12, 2013, the “Company RSUs”) and (iv) 110,315,412 Shares were held by the Company in its treasury. As of February 12, 2013, except as set forth in this Section 5.02(a), there were no preemptive or other outstanding rights, options, warrants, conversion rights, stock appreciation rights, redemption rights, repurchase rights, agreements, arrangements, calls, commitments or rights of any kind that obligate the Company to issue or sell any shares of capital stock or other securities of the Company or any securities or obligations convertible or exchangeable into or exercisable for, or giving any Person a right to subscribe for or acquire, any securities of the Company, and no securities or obligations evidencing such rights are authorized, issued or outstanding. Since February 12, 2013 through the date of this Agreement, no Equity Interests in the Company or any of its Subsidiaries have been issued, except for issuances pursuant to exercise or settlement of Company Options, Company RSUs or Company Phantom Shares, in each case outstanding as of the close of business on February 12, 2013, and only in accordance with the terms of such Company Options, Company RSUs or Company Phantom Shares as in effect on such date.

Phantom Shares, Company RSUs, and other equity-based awards outstanding under the Stock Plans (or otherwise), including the holder, number of Shares, exercise price and vesting schedule of such options and awards, as applicable.

for the purposes of Section 1922 of the PBCL, (iii) directing that this Agreement be submitted to a vote at a meeting of the Company’s shareholders entitled to vote hereon and (iv) recommending that the Company’s shareholders approve this Agreement (including approval of this Agreement by the shareholders entitled to vote thereon so that this Agreement is adopted for the purposes of Section 1924 of the PBCL) (such recommendation, the “Company Recommendation”), which resolutions have not, except after the date of this Agreement as permitted by Section 7.02, been rescinded, modified or withdrawn in any way.

generally accepted accounting principles (“GAAP”). Since the Applicable Date, the Company has not received any written notification of any (i) “significant deficiency” or (ii) “material weakness” (as defined in Rule 13a-15 or 15d-15, as applicable, under the Exchange Act) in the Company’s internal controls over financial reporting.

compensation plan, program, policy, contract, agreement or arrangement, in each case (i) established, maintained, sponsored or contributed to (or with respect to which any obligation to contribute has been undertaken) by the Company, any of its Subsidiaries or any Person that would be deemed a “single employer” with the Company or any of its Subsidiaries under Section 414 of the Code or Section 4001 of ERISA (each, an “ERISA Affiliate”) on behalf of any employee, director, or other individual service provider of the Company or any of its Subsidiaries (whether current, former or retired) or any of their beneficiaries and (ii) with respect to which the Company or any of its Subsidiaries has or could reasonably be expected to have, any liability or obligation; provided, however, that no plan, program or arrangement sponsored or maintained by any Governmental Entity nor any International Plan shall be considered a Company Plan.

meaning of Section 4205 and Section 4203 of ERISA, respectively) from any Company Multiemployer Plan.

arrangement with any employee or other individual service-provider providing for a tax gross-up or tax reimbursement.

applicable Environmental Laws except, in each case, as have not had or would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect.

Company or any of its Subsidiaries from amounts paid or owing to any employee, shareholder, member, creditor or other third party have been duly withheld or collected and have been paid over to the applicable Tax authority and (iv) all IRS Forms W-2, 1042-S and 1099 required with respect thereto have been properly completed and timely filed.

employee representative; (ii) to the Knowledge of the Company, there are no (and for the past two years there have not been any) ongoing or threatened union organization or decertification activities or proceedings relating to any employees of the Company or any of its material Subsidiaries, and no demand for recognition as the exclusive bargaining representative of any employees is pending by or on behalf of any labor organization, works council, trade union, or other employee representative; (iii) there is no (and for the past three years there has not been any) pending or, to the Knowledge of the Company, threatened strike, lockout, work stoppage, or other material labor disputes against or involving the Company or any of its Subsidiaries that has had or would reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect. With respect to the transactions contemplated by this Agreement, any notice to employees or their representatives required under applicable Law or collective bargaining agreement has been, or prior to the Closing Date will be, given, and all bargaining obligations have been, or prior to the Closing Date will be, satisfied, in each case, in all material respects. There are no unfair labor practice charges pending or, to the Knowledge of the Company, threatened against the Company or any of its Subsidiaries, nor are there any grievances or arbitrations under any collective bargaining agreement pending or, to the Knowledge of the Company, threatened against the Company or any of its Subsidiaries, in either case except for such matters as have not had or would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect.

Governmental Entity (excluding any administrative actions or proceedings in the ordinary course of business before the United States Patent and Trademark Office or any foreign counterpart thereof) or any arbitrator against the Company or any of its Subsidiaries concerning (A) the infringement, misappropriation or other violation of any Person’s Intellectual Property rights by the Company or any of its Subsidiaries, or (B) the validity, use, ownership, registrability or enforceability of any Material Company IP, that have had or would reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect. To the Knowledge of the Company, there is no ongoing or other infringement, misappropriation or other violation by any Person of any Material Company IP rights owned by the Company or any of its Subsidiaries that has had or would reasonably be expected to (x) have, individually or in the aggregate, a Company Material Adverse Effect, or (y) materially and adversely affect any trade secrets or Registered Company IP included in such Material Company IP.

by the Company or any of its Subsidiaries (the “Owned Real Property”) free and clear of all Liens other than Permitted Liens.

any of its Subsidiaries, or (xi) other Contract entered into outside the ordinary course of business (other than this Agreement or agreements between the Company and any of its wholly owned Subsidiaries or between any of the Company’s wholly owned Subsidiaries) under which the Company and its Subsidiaries are obligated to make or receive payments in the future in excess of $12,500,000 per annum or $50,000,000 during the life of the Contract. Each such Contract described in clauses (i)-(xi) is referred to herein as a “Company Material Contract”.

and the other transactions contemplated by this Agreement. No vote of holders of capital stock of Parent is necessary to approve this Agreement, the Merger or the other transactions contemplated by this Agreement. Each of Parent and Merger Sub has all requisite corporate power and authority and has taken all corporate action necessary in order to execute, deliver and perform its obligations under this Agreement and to consummate the Merger. This Agreement has been duly executed and delivered by each of Parent and Merger Sub and constitutes a valid and binding agreement of Parent and Merger Sub enforceable against each of Parent and Merger Sub in accordance with its terms, subject to the Bankruptcy and Equity Exception.

materially impede the consummation of the Merger or the other transactions contemplated by this Agreement.

in accordance with its terms, subject to the Bankruptcy and Equity Exception, and (z) each Equity Funding Letter constitutes a valid and binding obligation of each party thereto, enforceable against such party in accordance with its terms, subject to the Bankruptcy and Equity Exception. No event has occurred which, with or without notice, lapse of time or both, would or would reasonably be expected to (1) constitute a default or breach on the part of Parent or Merger Sub or, to the Knowledge of Parent, any other party thereto, (2) to the Knowledge of Parent, a failure of any condition to the Financing or (3) to the Knowledge of Parent otherwise result in any portion of the Financing being unavailable on the date of the Closing. Parent does not have any reason to believe that any of the conditions to the Financing will not be satisfied or that the Financing will not be available to Parent or Merger Sub in the full contemplated amount thereof on the date of the Closing. There are no conditions precedent or contingencies to the obligations of the parties under the Financing Letters (including pursuant to any “flex” provisions in the related fee letter or otherwise) to make the full amount of the Financing available to Parent on the terms therein except as expressly set forth in the Financing Letters. As of the date hereof, there are no side letters or other agreements, Contracts or arrangements to which Parent or any of its Affiliates is a party related to the funding or investing, as applicable, of the full amount of the Financing that could adversely affect the availability of the Financing other than as expressly set forth in the Financing Letters.

the conversion of First Series Preferred Shares outstanding on the date of this Agreement, (B) Equity Interests of any Subsidiary of the Company issued, sold, granted, transferred, pledged, disposed of or encumbered to the Company or any of its wholly owned Subsidiaries or (C) in connection with the refinancing or mandatory redemption of the Series B Preferred Shares of H. J. Heinz Finance Company but only if, in the case of this clause (C), such new Equity Interests are redeemable at any time at the Company’s option at or subsequent to the Effective Time; (iii) split, combine, subdivide or reclassify the Shares or any other outstanding Equity Interests of the Company or issue or authorize the issuance of any other securities in respect of, in lieu of or in substitution for any Equity Interests of the Company or (iv) redeem, purchase or otherwise acquire, directly or indirectly, any Equity Interests of the Company, other than (A) the redemption of Equity Interests of the Company’s Subsidiaries as required by the terms of such Equity Interests or the redemption of First Series Preferred Shares, (B) the acquisition of Shares in connection with the surrender of Shares by holders of Company Stock Options in order to pay the exercise price of the Company Stock Options, (C) the withholding of Shares to satisfy tax obligations with respect to awards granted pursuant to the Stock Plans and (D) the acquisition by the Company of Company Stock Options and Company RSUs in connection with the forfeiture of such awards;

 

(d) neither the Company nor any of its Subsidiaries will (i) except as required by applicable Law or pursuant to any Company Plan in effect and disclosed to Parent on or prior to the date of this Agreement, increase the compensation or benefits payable or to become payable to any of its Officers, directors, employees or consultants or enter into, establish, amend or terminate any Company Plans, other than (x) increases in compensation or benefits of employees who are not directors or Officers of the Company made in the ordinary course of business consistent with past practice (including with respect to amount); (ii) hire or engage for services any individual with target annual cash compensation of more than $250,000, (iii) other than ordinary course employment agreements entered into with employees performing services outside the United States, enter into any employment, change of control, severance or retention agreement with any director, Officer, employee or consultant of the Company except for newly hired Officers permitted to be hired by the terms of this Agreement or (iv) other than as expressly contemplated by this Agreement, take any action to accelerate the vesting or funding of any payment or benefit;

 

(e) neither the Company nor any of its Subsidiaries will make any loans or advances to any of its officers, directors, employees, agents or consultants or other related parties (other than in the ordinary course of business consistent with past practice in amount) or make any change in its existing borrowing or lending arrangements for or on behalf of any such Persons;

 

(f) neither the Company nor any of its Subsidiaries will implement any employee layoffs in violation of the Worker Adjustment and Retraining Notification Act of 1988, as amended, or any similar or related Law;

 

(g) neither the Company nor any of its Subsidiaries will (i) incur or assume any long-term Indebtedness in excess of $100,000,000 in the aggregate or incur or assume

any short-term Indebtedness other than in the ordinary course of business consistent with past practice in quantity and amount (in each case of this clause (i), other than intercompany Indebtedness or in connection with the refinancing of any Indebtedness or the mandatory redemption of any Equity Interests of the Company’s Subsidiaries), (ii) assume, guarantee, endorse or otherwise become liable or responsible (whether directly, contingently or otherwise) for the obligations of any other Person (other than a Subsidiary of the Company), except in the ordinary course of business consistent with past practice in quantity and amount, or (iii) make any material loans, advances or capital contributions to, or investments in, any other Person (other than in a Subsidiary of the Company) except in the ordinary course of business consistent with past practice in quantity and amount;

Parent or Merger Sub, directly or indirectly, the right to control or direct the operations of the Company or any of its Subsidiaries prior to the Effective Time, (ii) prior to the Effective Time, the Company shall exercise, consistent with the terms and conditions of this Agreement, control and supervision over its and its Subsidiaries’ operations and (iii) notwithstanding anything to the contrary in this Agreement, no consent of Parent shall be required with respect to any matter set forth in this Section 7.01 or elsewhere in this Agreement to the extent the requirement of such consent would reasonably be expected to be a violation of applicable Law.

 

(i) solicit, seek, initiate or knowingly facilitate or encourage (including by way of furnishing non-public information) any inquiries regarding, or the making of, any submission or announcement of a proposal or offer that constitutes, or would reasonably be expected to lead to, any Acquisition Proposal;

 

(ii) engage in, continue or otherwise participate in any discussions or negotiations regarding, or furnish to any other Person any non-public information in connection with or for the purpose of encouraging or facilitating, any Acquisition Proposal;

 

(iii) approve, endorse or recommend any Acquisition Proposal; or

 

(iv) enter into any letter of intent, memorandum of understanding, acquisition agreement, merger agreement or other similar agreement (other than an Acceptable Confidentiality Agreement) (an “Alternative Acquisition Agreement”) relating to any Acquisition Proposal.

The Company shall, and shall cause its Subsidiaries to, and shall direct and use its reasonable best efforts to cause its and their Representatives to, immediately cease and cause to be terminated all discussions and negotiations with any Person that may be ongoing with respect to any Acquisition Proposal, and the Company shall promptly deliver a written notice to each such Person to the effect that the Company is ending all discussions and negotiations with such Person with respect to any Acquisition Proposal, which notice shall also request such Person to promptly return or destroy all confidential information concerning the Company and its Subsidiaries.

following clauses (B) and (C), the Board of Directors of the Company (or any committee thereof) determines in good faith, after consultation with its financial advisor and outside legal counsel, that such Acquisition Proposal constitutes or could reasonably be expected to lead to a Superior Proposal and that failure to take such action would be reasonably likely to be inconsistent with the directors’ fiduciary duties under applicable Law, then the Company and its Representatives may (A) contact the Person or group of Persons who has made such Acquisition Proposal in order to clarify terms for the sole purpose of the Board of Directors of the Company informing itself about such Acquisition Proposal, (B) furnish, pursuant to an Acceptable Confidentiality Agreement, information (including non-public information) with respect to the Company and its Subsidiaries to the Person or group of Persons who has made such Acquisition Proposal; provided, that the Company shall promptly (and in any event within 24 hours) provide or make available to Parent any material non-public information concerning the Company or its Subsidiaries that is provided or made available to any Person given such access which was not previously provided to Parent or its Representatives and (C) engage in or otherwise participate in discussions or negotiations with the Person or group of Persons making such Acquisition Proposal. The Company shall not provide any commercially sensitive non-public information to any competitor in connection with the actions permitted by this Section 7.02(b) (or be obligated to provide any such information to Parent pursuant to the proviso to clause (B) of this Section 7.02(b)), other than in accordance with “clean room” or other similar procedures designed to limit any adverse effect of the sharing of the information on the Company.

have recommenced and the condition in clause (2) shall have been satisfied again, except that the notice period shall be at least one Business Day (rather than the three Business Days otherwise contemplated by clause (1) above).

connection with the preparation and filing of the Proxy Statement, including promptly furnishing to the Company in writing upon request any and all information relating to it as may be required to be set forth in the Proxy Statement under applicable Law. Parent agrees that such information supplied by or on behalf of Parent or Merger Sub in writing for inclusion (or incorporation by reference) in the Proxy Statement will not, on the date it is first mailed to shareholders of the Company and at the time of the Shareholders Meeting or filed with the SEC (as applicable), 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. The Company agrees that the Proxy Statement (i) will not, on the date it is first mailed to shareholders of the Company and at the time of the Shareholders Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading; provided that the foregoing shall not apply with respect to information contained or incorporated by reference in the Proxy Statement and supplied by or on behalf of Parent or Merger Sub for inclusion (or incorporation by reference) in the Proxy Statement and (ii) will comply as to form in all material respects with the applicable requirements of the Exchange Act.

of or filings with any other Governmental Entity) required to be obtained or made by Parent, Merger Sub, the Company or any of their respective Affiliates in connection with the Merger and the other transactions contemplated by this Agreement, (iv) the execution and delivery of any additional instruments necessary to consummate the Merger and the other transactions contemplated by this Agreement and to fully carry out the purposes of this Agreement. Additionally, each of Parent, Merger Sub, the Company and their respective Affiliates shall (a) subject to Section 7.05(e) and (f), use its reasonable best efforts to fulfill all conditions precedent to the Merger and (b) not take or agree to take any action after the date of this Agreement until the earlier of the termination of this Agreement or the Effective Time, including, for the avoidance of doubt, any acquisition of a food manufacturer (which shall be applicable to Affiliates), that would be reasonably likely to (w) materially delay the obtaining of, or result in not obtaining, any permission, approval or consent from any Governmental Entity necessary to be obtained prior to Closing, (x) materially increase the risk of any Government Entity entering an Order prohibiting the consummation of the Merger and the other transactions contemplated hereby, (y) materially increase the risk of not being able to have vacated, lifted, reversed or overturned any such Order on appeal or otherwise or (z) otherwise prevent or materially delay the consummation of the Merger and the other transactions contemplated hereby; provided that the foregoing shall not require any party to this Agreement to waive any of the conditions set forth in Article 8.

documentation and to respond, as promptly as practicable, to all inquiries and information requests received from any state Attorney General or other Governmental Entity in connection with antitrust matters.

without the prior written consent of Parent, which consent shall not be withheld with respect to the Agreed Restrictions. “Agreed Restrictions” means divestitures, hold separate arrangements or other dispositions of businesses or assets of the Company and its Subsidiaries, or other reasonable prohibitions or limitations (including those described in clauses (i) through (iv) of the first sentence of this Section 7.05(e)) on businesses or assets of the Company and its Subsidiaries, if such businesses or assets, in the aggregate, together generated (directly or indirectly) sales revenue of less than $750,000,000 during the twelve month period ended January 31, 2013.

employment or service of any employee or other service-provider following the Effective Time.

carrier with the same or better credit rating as the Company’s insurance carrier as of the date of this Agreement with respect to directors’ and officers’ liability insurance and fiduciary liability insurance (collectively, “D&O Insurance”) with benefits, terms, conditions, retentions and levels of coverage that are at least as favorable to the Indemnified Parties as the Company’s existing policies with respect to any matters 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 Surviving Corporation be required to expend for such policies pursuant to this sentence an aggregate premium amount in excess of 600% of the annual premium currently paid by the Company for such insurance. If the Company and the Surviving Corporation for any reason fail to obtain such “tail” insurance policies as of the Effective Time, the Surviving Corporation shall continue to maintain in effect for a period of at least six years from and after the Effective Time the D&O Insurance in place as of the date of this Agreement with benefits, terms, conditions, retentions and levels of coverage that are at least as favorable to the insureds as provided in the Company’s existing policies as of the date of this Agreement, or the Surviving Corporation shall use reasonable best efforts to purchase comparable D&O Insurance for such six-year period with benefits, terms, conditions, retentions and levels of coverage that are at least as favorable to the insureds as provided in the Company’s existing policies as of the date of this Agreement; provided, however, that in no event shall 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 for such insurance; 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 available for a cost not exceeding such amount.

Indemnified Party as provided in the articles of incorporation, bylaws or comparable governing documents of the Company and its Subsidiaries or any indemnification agreement between such Indemnified Party and the Company or any of its Subsidiaries shall survive the Merger and shall not be amended, repealed or otherwise modified in any manner that would adversely affect any right thereunder of any such Indemnified Party.

default by any party to any of the Financing Letters or Debt Financing Agreements, (y) of the receipt of any written notice or other written communication from any Financing source with respect to any actual or alleged breach, default, termination or repudiation by any party to any of the Financing Letters or any definitive document related to the Financing or any provisions of the Financing Letters or any definitive document related to the Financing, or (z) if Parent and Merger Sub determine in good faith that they will not be able to satisfy any of the obligations to, or otherwise be able to obtain, some or any portion of the Financing prior to the Termination Date. Upon the occurrence of any circumstance referred to in clause (x), (y) or (z) of the preceding sentence or if any portion of the Debt Financing otherwise becomes unavailable, and such portion is reasonably required to fund the aggregate Per Share Merger Consideration and all fees, expenses and other amounts contemplated to be paid by Parent, Merger Sub or the Surviving Corporation pursuant to this Agreement, Parent and Merger Sub shall use their reasonable best efforts to arrange and obtain in replacement thereof alternative financing from alternative sources in an amount sufficient to consummate the transactions contemplated by this Agreement on terms and conditions not less favorable to the Company or Parent (in the reasonable judgment of Parent) than the terms set forth in the Debt Commitment Letter (including the flex provisions thereof). Any reference in this Agreement to (1) the “Debt Financing” shall include any such alternative financing, (2) the “Debt Commitment Letter” shall include the commitment letter and the corresponding fee letter with respect to any such alternative financing, (3) the “Debt Financing Agreements” shall include the definitive agreements with respect to any such alternative financing and (4) the “Debt Financing Sources” shall include the financing institutions contemplated to provide any such alternative financing. Notwithstanding anything to the contrary contained in this Agreement, nothing contained in this Section 7.13(a) shall require, and in no event shall the reasonable best efforts of Parent or Merger Sub be deemed or construed to require, either Parent or Merger Sub to (i) seek the Equity Financing from any source other than those counterparty to, or in any amount in excess of that contemplated by, the Equity Funding Letters or (ii) pay any fees or any interest rates applicable to the Debt Financing in excess of those contemplated by the Debt Commitment Letter (including the flex provisions), or agree to any “market flex” term less favorable to Parent, Merger Sub or the Surviving Company than such corresponding market flex term contained in or contemplated by the Debt Commitment Letter (in either case, whether to secure waiver of any conditions contained therein or otherwise). Parent shall keep the Company informed on a reasonably current basis in reasonable detail of the status of its efforts to arrange the Financing and provide copies of all documents provided to the lenders or otherwise related to the Financing to the Company.

     (ix) requesting from the Company’s existing lenders such customary documents in connection with refinancings as requested by Parent in connection with the Financing and collateral arrangements, including customary payoff letters, lien releases, instruments of termination or discharge,

 

(x) furnishing Parent and the Debt Financing Sources with all documentation and other information required by Governmental Entities with respect to the Debt Financing under applicable “know your customer” and anti-money laundering rules and regulations, including the Uniting and Strengthening

America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001, as amended), and

 

(xi) cooperating with Parent, and taking all corporate actions, subject to the occurrence of the Effective Time, reasonably requested by Parent to permit the consummation of the Financing;

provided, however, that (A) nothing in this Section 7.13(b) shall require such cooperation to the extent it would interfere unreasonably with the business or operations of the Company or its Subsidiaries, (B) neither the Company nor any of its Subsidiaries shall be required to incur any liability that is not contingent upon the Closing (or, without limitation of the foregoing, execute any definitive financing documents (except the authorization letter delivered pursuant to the foregoing clause (iii)) prior to the Closing or any other agreement, certificate, document or instrument that would be effective prior to the Closing) and (C) none of the boards of directors (or equivalent bodies) of the Company or any of its Subsidiary shall be required to enter into any resolutions or take similar action approving the Financing. Parent shall indemnify and hold harmless the Company and its Subsidiaries and their respective Representatives from and against any and all liabilities, losses, damages, claims, costs, expenses (including attorneys’ fees), interest, awards, judgments and penalties suffered or incurred in connection with this Section 7.13(b). Parent shall, promptly upon request by the Company, reimburse the Company for all reasonable out-of-pocket costs (including reasonable attorneys’ fees) incurred by the Company or its Subsidiaries in connection with this Section 7.13(b). Parent shall cause all non-public or confidential information provided by or on behalf of the Company or any of its Subsidiaries pursuant to this Section 7.13(b) to be kept confidential in accordance with the Confidentiality Agreements.

(or such later time as may be required by such indenture, other governing documents or law) for all of the outstanding aggregate principal amount of such securities of such series pursuant to the requisite provisions of such indenture or other governing documents or (ii) take any actions reasonably requested by Parent that are customary or necessary to facilitate the redemption, defeasance, satisfaction and/or discharge of such series pursuant to the applicable section of such governing documents, and shall redeem, defease or satisfy and/or discharge, as applicable, such series in accordance with the terms of such governing documents at the Effective Time; provided, that the Company’s counsel shall provide such legal opinions as may be reasonably requested by Parent that are customary or necessary in connection with any such redemption or satisfaction and discharge; provided further that any such redemption or satisfaction and discharge must be conditioned on the occurrence of the Closing and shall only be effectuated if the documents governing such series of securities permit such conditional redemption. Parent shall ensure that at the Effective Time the Surviving Corporation has all funds necessary in connection with any such redemption or satisfaction and discharge. Parent and Merger Sub acknowledge and agree that neither the pendency nor the consummation of any such redemption, defeasance or satisfaction and discharge is a condition to Parent’s or Merger Sub’s obligations to consummate the Merger.

attorney’s fees) interest, awards, judgments and penalties suffered or incurred in connection with this Section 7.14. Parent shall, promptly upon request by the Company, reimburse the Company for all reasonable out-of-pocket costs (including reasonable attorneys’ fees) incurred by the Company or its Subsidiaries in connection with this Section 7.14.

cause dispositions of equity awards outstanding under the Company Plans by each individual who is or will be 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.

thereunder shall have been terminated or expired and (iii) all required approvals under any Antitrust Laws applicable to the Merger in the jurisdictions listed in Section 8.01(b) of the Company Disclosure Letter shall have been obtained or any applicable waiting period thereunder shall have been terminated or expired.

this Section 9.03(b) due to the failure of Parent or Merger Sub to consummate the transactions contemplated by this Agreement on the date the Closing should have occurred pursuant to Section 1.02; or

contrary in this Agreement, the occurrence from and after the date of a properly delivered Closing Failure Notice of any development, fact, change, event, effect, occurrence or circumstance that has had or would reasonably be expected to have a Company Material Adverse Effect shall not excuse payment of the Parent Termination Fee. For the avoidance of doubt, at any time during the Closing Failure Remedy Period, Parent may provide written notice of its intention and capacity to consummate the Closing, and the parties shall, on the second Business Day following such notice, consummate the Closing.

then the Company in settlement and termination of the rights of Parent to acquire the shares of the Company hereunder shall (A) in the case of clause (i) above, upon the earlier of entering into such definitive agreement with respect to such Acquisition Proposal or consummation of the transactions contemplated by such Acquisition Proposal, (B) in the case of clause (ii) above, no later than two Business Days after the date of such termination and (C) in the case of sub-clause (iii) above, immediately prior to or simultaneously with such termination, pay Parent or one or more Persons designated by Parent the Termination Fee (less any amounts previously paid pursuant to Section 9.05(d)) by wire transfer of immediately available funds (it being understood that in no event shall the Company be required to pay the Termination Fee on more than one occasion). Following receipt by Parent of the Termination Fee in accordance with this Section 9.05(b) under circumstances where the Termination Fee was payable, neither the Company nor any of its Affiliates shall have any further liability with respect to this Agreement or the transactions contemplated herein to Parent or any of its Affiliates. “Termination Fee” shall mean an amount equal to $750,000,000 in cash. In connection with 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 to be consummated, other than in circumstances where Parent receives the Termination Fee in accordance with this Section 9.05(b) under circumstances where the Termination Fee was payable (in which case the second preceding sentence shall apply), Parent agrees that the maximum

aggregate monetary liability of the Company, if any, shall be limited to the amount of the Parent Termination Fee, and in no event shall Parent seek to recover any monetary damages in excess of such amount.

later than two Business Days after the date of delivery by Parent of an invoice therefor, pay Parent or one or more Persons designated by Parent, all documented out-of-pocket fees and expenses incurred by Parent, Merger Sub and their respective Affiliates in connection with the transactions contemplated by this Agreement, including the Financing (“Parent Expenses”); provided that the Company shall not be required to pay more than an aggregate of $25,000,000 in Parent Expenses pursuant to this Section 9.05(d). The payment of the expense reimbursement pursuant to this Section 9.05(d) shall not relieve the Company of any subsequent obligation to pay the applicable Termination Fee pursuant to Section 9.05(b).

receive both a grant of specific performance of the Company’s obligation to consummate the Merger and any money damages, including all or any portion of the Termination Fee.

declines to accept jurisdiction over a particular matter, any federal court within the State of Delaware, or, if both the Court of Chancery of the State of Delaware and the federal courts within the State of Delaware decline to accept jurisdiction over a particular matter, any other state court within the State of Delaware, and, in each case, any appellate court therefrom (together, the “Chosen Courts”), for the purposes of any suit, action or other proceeding arising out of this Agreement or the Merger or any other transaction contemplated by this Agreement (and agrees that no such action, suit or proceeding relating to this Agreement shall be brought by it or any of its Subsidiaries except in such courts). Each of the parties further agrees that, to the fullest extent permitted by applicable Law, service of any process, summons, notice or document by U.S. registered mail to such person’s respective address set forth below shall be effective service of process for any action, suit or proceeding in the State of Delaware with respect to any matters to which it has submitted to jurisdiction as set forth above in the immediately preceding sentence. Each of the parties hereto irrevocably and unconditionally waives (and agrees not to plead or claim), any objection to the laying of venue of any action, suit or proceeding arising out of this Agreement or the Merger or any of the other transactions contemplated by this Agreement in the Chosen Courts, or that any such action, suit or proceeding brought in any such court has been brought in an inconvenient forum. No party hereto, nor any of its Affiliates, will bring, or support the bringing of, any claim, whether at law or in equity, whether in contract or in tort or otherwise, against any source of the Debt Financing in any way relating to this Agreement or any of the transactions contemplated by this Agreement, including any dispute arising out of or relating in any way to the Debt Commitment Letter or the performance thereof, anywhere other than in (i) any New York State court sitting in the County of New York or (ii) the United States District Court for the Southern District of New York.

under the provisions of this Agreement (including failing to take such actions as are required of them hereunder to consummate this Agreement) in accordance with its specified terms or otherwise breach such provisions. Subject to the following sentence, the parties acknowledge and agree (and further agree not to take any contrary position in any litigation concerning this Agreement) that (a) the parties shall be entitled to an injunction or injunctions, specific performance, or other equitable relief, to prevent breaches of this Agreement and to enforce specifically the terms and provisions hereof (including the obligations of the parties hereto to consummate the Closing in accordance with Section 1.02) in the Chosen Courts without proof of damages or otherwise, and that such relief may be sought in addition to and shall not limit, diminish, or otherwise impair, any other remedy to which they are entitled under this Agreement, (b) the provisions set forth in Section 9.05 are not intended to and do not adequately compensate for the harm that would result from a breach of this Agreement and shall not be construed to limit, diminish or otherwise impair in any respect any party’s right to specific enforcement and (c) the right of specific enforcement is an integral part of the transactions contemplated by this Agreement and without that right, neither the Company nor Parent would have entered into this Agreement. Notwithstanding the foregoing, it is explicitly agreed that the right of the Company to seek an injunction, specific performance or other equitable remedies in connection with (A) enforcing Parent’s obligation to cause the Equity Financing to be funded to fund the Merger and the other transactions contemplated hereby shall be subject to the requirements that (i) all conditions in Section 8.01 and 8.02 are satisfied (other than those conditions that by their terms are to be satisfied by actions taken at Closing) at the time when the Closing is required to occur pursuant to Section 1.02, (ii) the Debt Financing (including any alternative financing that has been obtained in accordance with Section 7.13(a) of this Agreement) has been funded in accordance with the terms thereof or will be funded in accordance with the terms thereof at the Closing if the Equity Financing is funded at the Closing, and (iii) the Company has irrevocably confirmed that if the Equity Financing and Debt Financing are funded, then it would take such actions that are within its control to cause the Closing to occur, and (B) enforcing Parent’s obligation to cause the Debt Financing to be funded to fund the Merger shall be subject to the requirements that (i) all conditions in Section 8.01 and 8.02 are satisfied (other than those conditions that by their terms are to be satisfied by actions taken at Closing) at the time when the Closing is required to occur pursuant to Section 1.02, (ii) all of the conditions to the consummation of the Debt Financing provided for in the Debt Commitment Letter have been satisfied (other than those conditions that by their terms are to be satisfied by actions taken at the time of funding or conditions that failed to be satisfied as a result of a breach by any source of the Debt Financing), and (iii) the Company has irrevocably confirmed that if the Equity Financing and Debt Financing are funded, then it would take such actions that are within its control to cause the Closing to occur. Each of the parties hereto agrees that it will not oppose the granting of an injunction, specific performance and other equitable relief on the basis that (A) the other parties hereto have an adequate remedy at law or (B) an award of specific performance is not an appropriate remedy for any reason at law or equity. The parties hereto acknowledge and agree that any party seeking an injunction or injunctions to prevent breaches of this Agreement and to enforce specifically the terms and provisions of this

Agreement in accordance with this Section 10.06 shall not be required to provide any bond or other security in connection with any such order or injunction.

or to such other Persons or addresses as may be designated in writing by the party to receive such notice as provided above. Any notice, request, instruction or other document given as provided above shall be deemed given to the receiving party upon actual receipt, if delivered personally; three Business Days after deposit in the mail, if sent by registered or certified mail; upon confirmation of successful transmission if sent by facsimile (provided that if given by facsimile such notice, request, instruction or other document shall be followed up within one Business Day by dispatch pursuant to one of the other methods described herein other than by e-mail); on the next Business Day after deposit with an overnight courier, if sent by an overnight courier; or upon receipt if sent by e-mail (provided that if given by e-mail such notice, request, instruction or other document shall be followed up within one Business Day by dispatch pursuant to one of the other methods described herein other than by facsimile).

Agreement, or the application thereof to any Person or any circumstance, is invalid or unenforceable, (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 thereof, in any other jurisdiction.

reference only and shall not have the effect of amending or changing the express terms of the sections or subsections as set forth in this Agreement.

“3GSSFIII” means 3G Special Situations Fund III, L.P.

 

“2003 Stock Incentive Plan” has the meaning set forth in Section 5.02.

 

“2013 Stock Incentive Plan” has the meaning set forth in Section 5.02.

 

“Acceptable Confidentiality Agreement” means one or more executed confidentiality agreements on customary terms that are not materially less favorable in the aggregate to the Company than those contained in the Confidentiality Agreements.

 

“Acquisition Proposal” means any inquiry, proposal or offer from any Person or group of Persons (other than Parent, Merger Sub, or any Guarantor or any Affiliate of any of the foregoing) providing for (a) any direct or indirect acquisition or purchase, in a single transaction or a series of related transactions, of (1) 20% or more (based on the fair market value, as determined in good faith by the Board of Directors of the Company (or any committee thereof)) of assets (including capital stock of the Subsidiaries of the Company) of the Company and its Subsidiaries, taken as a whole, or (2) Shares or other equity securities of the Company which together with any other Shares or other equity securities of the Company beneficially owned by such person or group, would equal 20% or more of aggregate voting power of the Company, (b) any tender offer or exchange offer that, if consummated, would result in any person or group owning, directly or indirectly, 20% or more of the aggregate voting power of the Company,(c) any merger, consolidation, business combination, binding share exchange or similar transaction involving the Company pursuant to which any person or group (or the shareholders of any person) would own, directly or indirectly, 20% or more of the aggregate voting power of the Company or of the surviving entity in a merger or the resulting direct or indirect parent of the Company or such surviving entity, or (d) any recapitalization transaction involving the Company, other than, in each case, the transactions contemplated by this Agreement.

 

“Affected Employees” has the meaning set forth in Section 7.09(a).

 

“Affiliate” means, when used with respect to any party, any Person who is an “affiliate” of that party within the meaning of Rule 405 promulgated under the Securities Act.

 

“Agreed Restrictions” has the meaning set forth in Section 7.05(e).

 

“Agreement” has the meaning set forth in the Preamble to this Agreement.

 

“Alternative Acquisition Agreement” has the meaning set forth in Section 7.02(a).

 

“Antitrust Law” means the Sherman Act, the Clayton Act, the HSR Act, the Federal Trade Commission Act 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, including, as applicable, Foreign Antitrust Laws.

 

“Applicable Date” has the meaning set forth in Section 5.05(a).

 

“Articles of Merger” has the meaning set forth in Section 1.03.

 

“Bankruptcy and Equity Exception” means any bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and similar Laws of general applicability relating to or affecting creditors’ rights and to general equity principles.

 

“Berkshire” means Berkshire Hathaway Inc.

 

“Business Day” means any day ending at 11:59 p.m. (Eastern Time) other than a Saturday or Sunday or other day on which banks are required or authorized to close in the City of New York.

 

“Certificate” has the meaning set forth in Section 4.01(a).

 

“Chosen Courts” has the meaning set forth in Section 10.05(a).

 

“Closing” has the meaning set forth in Section 1.02.

 

“Closing Date” has the meaning set forth in Section 1.02.

 

“Closing Failure Notice” has the meaning set forth in Section 9.03(c).

 

“Closing Failure Remedy Period” has the meaning set forth in Section 9.03(c).

 

“Code” has the meaning set forth in Section 4.02(g).

 

“Company” has the meaning set forth in the Preamble to this Agreement.

 

“Company Adverse Recommendation Change” has the meaning set forth in Section 7.02(d).

 

“Company Disclosure Letter” has the meaning set forth in Article 5.

 

“Company Financial Statements” has the meaning set forth in Section 5.05(d).

 

“Company Material Adverse Effect” means any development, fact, event, change, effect, occurrence or circumstance that has a material adverse effect on (i) the ability of the Company to consummate the Merger, or (ii) the business, results of

operations or financial condition of the Company and its Subsidiaries, taken as a whole; provided that none of the following shall either alone or in combination constitute, or be taken into account in determining whether there has been or would reasonably be expected to be a Company Material Adverse Effect under this clause (ii): any development, fact, event, change, effect, occurrence or circumstance to the extent resulting from (A) economic conditions in the United States generally or economic conditions in countries in which the Company and its Subsidiaries conduct significant operations or global economic conditions, except to the extent such developments, facts, events, changes, effects, occurrences or circumstances have a disproportionate effect on the Company and its Subsidiaries, taken as a whole, relative to others in the industries in which they operate, (B) conditions generally affecting the industries within which the Company or any of its Subsidiaries operate, except to the extent such changes in conditions have a disproportionate effect on the Company and its Subsidiaries, taken as a whole, relative to others in such industries, (C) regulatory, legislative or political conditions or securities, financial, debt or other capital markets conditions, except to the extent such conditions have a disproportionate effect on the Company and its Subsidiaries, taken as a whole, relative to others in the industries in which the Company or any of its Subsidiaries operate, (D) any failure, in and of itself, by the Company 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 or any decline in the market price or trading volume of the Shares or the credit rating of the Company (it being understood that the facts or occurrences giving rise to or contributing to such failure may, if not otherwise excluded from the definition of Material Adverse Effect, be taken into account in determining whether there has been or would reasonably be expected to be a Company Material Adverse Effect), (E) the execution and delivery of this Agreement, the public announcement or pendency of the Merger or any of the other transactions contemplated hereby, the taking of any action required or expressly contemplated by this Agreement or at the written request of, or with the written consent of, Parent or Merger Sub or the identity of, or any facts or circumstances relating to, Parent, 3GSSFIII, Berkshire or any of their respective Affiliates, including the impact of any of the foregoing on the relationships, contractual or otherwise, of the Company or any of its Subsidiaries with other Persons, including Governmental Entities, customers, suppliers, officers or employees (provided that the exceptions in this clause (E) shall not apply to any representation or warranty contained in Article 5 (or any portion thereof) or Section 8.02(a) to the extent that it addresses the consequences resulting from the execution and delivery of this Agreement or the performance of obligations or satisfaction of conditions under this Agreement), (F) any change in Law, (G) any change in GAAP (or authoritative interpretations thereof), (H) any changes in geopolitical conditions or the outbreak or escalation, or any acts, of hostilities, war (whether or not declared), sabotage or terrorism, (I) any hurricane, earthquake, flood or other natural or man-made disaster, act of God or change resulting from weather conditions or (J) any shareholder litigation relating to this Agreement, the Merger or any of the other transactions contemplated hereby (it being understood that the facts and circumstances giving rise to or contributing to any liability identified thereunder and not arising from this Agreement, the Merger or any of the transactions contemplated hereby may, if not otherwise excluded from the definition of Company Material Adverse Effect, constitute,

 

or be taken into account in determining whether there has been or would reasonably be expected to be a Company Material Adverse Effect).

administered by the U.S. Office of Foreign Assets Control, the antiboycott Laws administered by the U.S. Department of Commerce, the antiboycott Laws administered by the U.S. Department of the Treasury, and the FCPA.

“Debt Commitment Letter” has the meaning set forth in Section 6.05.

 

“Debt Financing” has the meaning set forth in Section 6.05.

 

“Debt Financing Sources” has the meaning set forth in Section 6.05.

 

“Debt Tender Offer” or “Debt Tender Offers” has the meaning set forth in Section 7.14(a).

 

“D&O Insurance” has the meaning set forth in Section 7.11(b).

 

“Disclosure Letter” has the meaning set forth in Section 10.13(c).

 

“Dissenting Shares” has the meaning set forth in Section 4.01(a).

 

“Dissenting Shareholders” has the meaning set forth in Section 4.01(a).

 

“Effective Time” has the meaning set forth in Section 1.03.

 

“Environmental Law” means any Law concerning worker health and safety (only to the extent relating to Hazardous Materials), protection of public health from environmental hazards, pollution, or the protection of the environment (including air, surface water and groundwater), or the use, storage, recycling, treatment, generation, transportation, processing, handling, release or disposal of, or exposure to, any Hazardous Material.

 

“Equity Financing” has the meaning set forth in Section 6.05.

 

“Equity Funding Letters” has the meaning set forth in Section 6.05.

 

“Equity Interests” has the meaning set forth in Section 7.01(c).

 

“ERISA” has the meaning set forth in Section 5.08(a).

 

“ERISA Affiliate” has the meaning set forth in Section 5.08(a).

 

“Exchange Act” has the meaning set forth in Section 5.04(a).

 

“Exchange Fund” has the meaning set forth in Section 4.02(a).

 

“Excluded Shares” has the meaning set forth in Section 4.01(a).

 

“FCPA” has the meaning set forth in Section 5.09(b).

 

“Financing” has the meaning set forth in Section 6.05.

 

“Financing Letters” has the meaning set forth in Section 6.05.

 

“Financing Proceedings” has the meaning set forth in Section 9.03(c).

 

“First Series Preferred Shares” has the meaning set forth in Section 5.02.

 

“Foreign Antitrust Laws” has the meaning set forth in Section 5.04(a).

 

“Fourth Series Preferred Shares” has the meaning set forth in Section 5.02.

 

“GAAP” has the meaning set forth in Section 5.05(b).

 

“Governmental Entity” has the meaning set forth in Section 5.04(a).

 

“GSPP” has the meaning set forth in Section 4.03(d).

 

“Guarantees” has the meaning set forth in the Recitals to this Agreement.

 

 “Guarantor” or “Guarantors” has the meaning set forth in the Recitals to this Agreement.

 

“Hazardous Materials” has the meaning set forth in Section 5.10(d).

 

“HSR Act” has the meaning set forth in Section 5.04(a).

 

“Indebtedness” of any Person means, as of any specified time, (a) all obligations of such Person for borrowed money to the extent appearing as a liability on a balance sheet of such Person prepared in accordance with GAAP, (b) all obligations of such Person evidenced by bonds, debentures, notes or similar instruments for the payment of which such Person is responsible or liable to the extent appearing as a liability on a balance sheet of such Person prepared in accordance with GAAP, (c) all obligations of such Person as an account party in respect of letters of credit and bankers’ acceptances or similar credit transactions, (d) all obligations of such Person under interest rate, currency or commodity derivatives or hedging transactions (valued at the termination value thereof) and (e) all obligations of such Person guaranteeing any obligations of any other Person of the type described in the foregoing.

 

“Indemnified Parties” has the meaning set forth in Section 7.11(a).

 

“Intellectual Property” means all intellectual property and associated rights in any jurisdiction, including all (a) trademarks, service marks, trade names, corporate names, company names, business names, fictitious business names, trade styles, logos, slogans, trade dress and all other source or business identifiers and all applications and registrations and renewals for, and goodwill associated with and symbolized by, any of the foregoing (collectively, “Trademarks”), (b) Internet domain names, (c) patent disclosures, patent applications and patents and all registrations, continuations, continuations-in-part, divisionals, re-examinations, renewals, extensions and reissues and counterparts thereof (collectively, “Patents”), (d) trade secrets and know-how, including

 

 

all proprietary or confidential inventions, improvements, processes, methods, techniques, protocols, formulae, recipes, compositions, models, layouts, designs, drawings, plans, specifications, methodologies and other proprietary or other confidential information, (e) works of authorship (whether or not copyrightable), copyrights and registrations and applications therefor, and all renewals, extensions, restorations and reversions thereof, including website content, product artwork, promotion and marketing materials, software, databases and database rights, and (f) rights of publicity and privacy.

 

“International Plan” means any material employment, severance or similar contract, plan, arrangement or policy and each other plan or arrangement providing for cash or equity compensation, profit-sharing, incentive or deferred compensation, vacation benefits, insurance (including any self-insured arrangements), health or medical benefits, disability or sick leave benefits and post-employment or retirement benefits, in each case which is maintained outside of the United States by the Company or any of its Subsidiaries (i) primarily for the benefit of any employee, director or other individual service provider of the Company or any of its Subsidiaries working or otherwise providing services outside of the United States (whether current, former or retired) or any of their beneficiaries or (ii) with respect to which the Company or any of its Subsidiaries has or could reasonably be expected to have, any liability or obligation.

 

“IRS” means the Internal Revenue Service.

 

“Knowledge” means (i) when referring to the knowledge of the Company or any of its Subsidiaries, the actual knowledge of the Company officers listed on Annex A of the Company Disclosure Letter and (ii) when referring to the knowledge of Parent, the actual knowledge of the officers of Parent as of the date hereof.

 

“Law” or “Laws” means any domestic or foreign laws, statutes, ordinances, rules (including rules of common law), regulations, codes, Orders or legally enforceable requirements enacted, issued, adopted, or promulgated by any Governmental Entity and any judicial interpretation thereof.

 

“Leases” has the meaning set forth in Section 5.15(b).

 

“Lien” means any lien, charge, pledge, security interest, claim or other encumbrance.

 

“Marketing Period” means the first period of 20 consecutive Business Days after the date of this Agreement beginning on the first day on which (a) Parent shall have the Required Information and during which period such information shall remain compliant in all material respects at all times with the applicable provisions of Regulation S-X and Regulation S-K under the Securities Act; provided, that if the Company shall in good faith reasonably believe it has provided the Required Information, it may deliver to Parent a written notice to that effect (stating when it believes it completed such delivery), in which case the Company shall be deemed to have complied with such obligation to provide the Required Information unless Parent in good faith reasonably believes the Company has not completed the delivery of the Required Information (or Parent cannot

 

 

confirm whether the Company has completed the delivery of the Required Information) and within five Business Days after the delivery of such notice by the Company, delivers a written notice to the Company to that effect (stating, to the extent reasonably practicable, which Required Information the Company has not delivered) and (b) the conditions set forth in Sections 8.01 and 8.02 have been satisfied (other than those conditions that by their terms are to be satisfied at the Closing) and nothing has occurred and no condition exists that would cause any of the other conditions set forth in Section 8.02 to fail to be satisfied, assuming that the Closing Date were to be scheduled for any time during such 20 consecutive Business Day period; provided that (i) July 5, 2013 shall be excluded as a Business Day and (ii) such 20 Business Day period shall either end prior to August 19, 2013 or commence after August 30, 2013. Notwithstanding the foregoing, the “Marketing Period” shall not commence and shall be deemed not to have commenced (i) prior to the mailing of the Proxy Statement, (ii) if prior to the completion of the Marketing Period, the Company’s auditors shall have withdrawn any audit opinion contained in the Required Information, in which case the Marketing Period shall not be deemed to commence unless and until a new unqualified audit opinion is issued with respect thereto by the Company’s auditors or another independent public accounting firm reasonably acceptable to Parent, (iii) if prior to the completion of the Marketing Period, the financial statements included in the Required Information that is available to Parent on the first day of the Marketing Period would not be sufficiently current on any day during such period to satisfy the requirements of Rule 3-12 of Regulation S-X to permit a registration statement of the Company using such financial statements to be declared effective by the SEC on the last day of such period, in which case the Marketing Period shall not be deemed to commence until the receipt by Parent of updated Required Information that would be required under Rule 3-12 of Regulation S-X to permit a registration statement of the Company using such financial statements to be declared effective by the SEC on the last day of such new 20 consecutive Business Day period, (iv) if prior to the completion of the Marketing Period, the Company issues a public statement indicating its intent to restate any historical financial statements of the Company or that any such restatement is under consideration or may be a possibility, in which case the Marketing Period shall not be deemed to commence unless and until such restatement has been completed and the relevant financial statements have been amended or the Company has announced that it has concluded that no restatement shall be required in accordance with GAAP, or (v) if prior to the completion of the Marketing Period, the Company shall have been delinquent in filing any Annual Report on Form 10-K or Quarterly Report on Form 10-Q, in which case the Marketing Period will not be deemed to commence unless and until all such delinquencies have been cured; provided that the Marketing Period shall end on any earlier date on which the proceeds of the Debt Financing are obtained.

 

“Material Company IP” means all material Intellectual Property used in or necessary for the conduct of the business of the Company and its Subsidiaries as presently conducted, including all material Registered Company IP.

 

“Merger” has the meaning set forth in the Recitals to this Agreement.

 

“Merger Sub” has the meaning set forth in the Preamble to this Agreement.

 

 

“NYSE” has the meaning set forth in Section 5.04(a).

 

“Offering Documents” means prospectuses, private placement memoranda, information memoranda and packages and lender and investor presentations, in connection with the Financing.

 

“Officer” means, for the purposes of Section 7.01(d), any employee of the Company in Band 10 or above, as determined pursuant to the Company’s policies in effect as of the date hereof.

 

“Order” means any order, judgment, injunction, award, decree or writ adopted or imposed by, including any consent decree, settlement agreement or similar written agreement with, any Governmental Entity.

 

“Owned Real Property” has the meaning set forth in Section 5.15(a).

 

“Parent” has the meaning set forth in the Preamble to this Agreement.

 

“Parent Expenses” has the meaning set forth in Section 9.05(d).

 

“Parent Related Parties” has the meaning set forth in Section 9.05(f).

 

“Parent Required Governmental Approvals” has the meaning set forth in Section 6.03(a).

 

“Parent Termination Fee” has the meaning set forth in Section 9.05(c).

 

“Patents” has the meaning set forth in the “Intellectual Property” definition.

 

“Paying Agent” has the meaning set forth in Section 4.02(a).

 

“PBCL” has the meaning set forth in Section 1.01.

 

“PBGC” has the meaning set forth in Section 5.08(c).

 

“Per Share Merger Consideration” has the meaning set forth in Section 4.01(a).

 

“Permit” means any authorizations, licenses, franchises, consents, certificates, registrations, approvals or other permits of any Governmental Entity.

 

“Permitted Liens” mean (i) mechanics’, carriers’, workmen’s, warehousemen’s, repairmen’s or other like Liens arising or incurred in the ordinary course of business, (ii) Liens for taxes, assessments and other governmental charges and levies that are not due and payable or that may thereafter be paid without interest or penalty, (iii) Liens affecting the interest of the grantor of any easements benefiting Owned Real Property, (iv) Liens (other than liens securing indebtedness for borrowed money), defects or irregularities in title, easements, rights-of-way, covenants, restrictions, and other, similar matters that would not, individually or in the aggregate, reasonably be expected to materially impair the continued use and operation of the assets to which they relate, (v) zoning, building

 

 

and other similar codes and regulations and (vi) any conditions that would be disclosed by a current, accurate survey or physical inspection.

 

“Person” means any individual, corporation (including not-for-profit), general or limited partnership, limited liability company, joint venture, estate, trust, association, organization, Governmental Entity or other entity of any kind or nature.

 

“Phantom Shares” means a compensatory contractual right with a value determined by reference to the value of a Share.

 

“Preferred Shares” has the meaning set forth in Section 5.02.

 

“Proxy Statement” has the meaning set forth in Section 5.04(a).

 

“Public Notes” means the 5.350% Notes due 2013, 6.049% Dealer Remarketable Securities due 2014, 2.000% Notes due 2016, 1.500% Notes due 2017, 3.125% Notes due 2021, 2.850% Notes due 2022 and 7.125% Guaranteed Notes due 2039 and 6.250% Notes due 2030 issued by the Company and/or its Subsidiaries.

 

“Record Holder of Shares” has the meaning set forth in Section 4.02(b).

 

“Registered Company IP” means all issued or pending Patents, Trademark registrations and applications for registration of Trademarks, copyright registrations and applications for registration of copyrights and Internet domain names, in each case, owned by the Company or any of its Subsidiaries.

 

“Representatives” has the meaning set forth in Section 7.02(a).

 

“Required Information” means all customary financial information of the Company and its Subsidiaries that is reasonably available to or readily obtainable by the Company that is required (i) to permit Parent and Merger Sub to prepare a pro forma consolidated balance sheet and related pro forma consolidated statement of income of the Company as of and for the twelve-month period ending on the last day of the most recently completed four-fiscal quarter period ended at least 45 days prior to the Closing Date (or 90 days in case such four-fiscal quarter period is the end of the Company’s fiscal year), prepared after giving effect to the Transactions as if the Transactions had occurred as of such date (in the case of such balance sheet) or at the beginning of such period (in the case of such statement of income) and (ii) under paragraphs 9 and 11 of Exhibit D to the Debt Commitment Letter (as in effect on the date of this Agreement), including financial statements prepared in accordance with GAAP, audit reports, and other financial information and financial data regarding the Company and its Subsidiaries of the type and form required by Regulation S-X and Regulation S-K under the Securities Act for registered offerings of securities on Form S-3 (or any successor form thereto) under the Securities Act (excluding information required by Rules 3-10 and 3-16 under Regulation S-X), and of the type and form, and for the periods, customarily included in Offering Documents used in private placements of debt securities under Rule 144A of the Securities Act, to consummate the offerings or placements of any debt securities, in each case assuming that such offering(s) of debt securities were consummated at the same time

 

 

during the Company's fiscal year as such offering(s) of debt securities will be made; provided that with respect to the pro forma data described in clause (i) above, the following shall not be considered part of the Required Information: (a) any post-Closing or pro forma cost savings, capitalization and other post-Closing or pro forma adjustments (and the assumptions relating thereto) desired by the Parent to be reflected in such pro forma data, and (b) any other information concerning the assumptions underlying the post-Closing or pro forma adjustments to be made in such pro forma and summary financial data, which assumptions shall be the responsibility of Parent.

 

“Sarbanes-Oxley Act” has the meaning set forth in Section 5.05(a).

 

“SEC” has the meaning set forth in Section 5.04(a).

 

“Second Series Preferred Shares” has the meaning set forth in Section 5.02.

 

“Securities Act” means the Securities Act of 1933, as amended.

 

“Share” or “Shares” has the meaning set forth in Section 4.01(a).

 

“Shareholders Meeting” has the meaning set forth in Section 7.03(a).

 

“Solvent” means that, with respect to any Person, as of any date of determination, (a) the amount of the “fair saleable value” of the assets of such Person will, as of such date, exceed the sum of (i) the value of all “liabilities of such Person, including contingent and other liabilities,” as of such date, as such quoted terms are generally determined in accordance with applicable Laws governing determinations of the insolvency of debtors, and (ii) the amount that will be required to pay the probable liabilities of such Person, as of such date, on its existing debts (including contingent and other liabilities) as such debts become absolute and mature, (b) such Person will not have, as of such date, an unreasonably small amount of capital for the operation of the businesses in which it is engaged or proposed to be engaged following such date, and (c) such Person will be able to pay its liabilities, as of such date, including contingent and other liabilities, as they mature.

 

“Stock Plans” has the meaning set forth in Section 5.02.

 

“Subsidiary” means, with respect to any Person, any other Person of which at least a majority of the securities or ownership interests having by their terms ordinary voting power to elect a majority of the board of directors or other persons performing similar functions is directly or indirectly owned or controlled by such Person and/or by one or more of its Subsidiaries.

 

“Superior Proposal” means any bona fide, written Acquisition Proposal (with all references to “20%” in the definition of Acquisition Proposal being deemed to be references to “50%”) which the Board of Directors of the Company (or any committee thereof) determines in good faith (after consultation with its financial advisor and outside legal counsel) (x) is reasonably likely to be consummated in accordance with its terms, and (y) if consummated, would be more favorable to the shareholders of the Company

 

 

from a financial point of view than the Merger, in each case taking into account all financial, legal, financing, regulatory and other aspects of such Acquisition Proposal (including the person or group making the Acquisition Proposal) and of this Agreement (including any changes to the terms of this Agreement proposed by Parent and any fees to be paid by the Company pursuant to Section 9.05).

 

“Surviving Corporation” has the meaning set forth in Section 1.01.

 

“Takeover Statute” has the meaning set forth in Section 5.18(a).

 

“Tax” or “Taxes” means all taxes or other governmental charges of any kind, including any federal, state, local and foreign income, profits, franchise, gross receipts, duty, stamp, payroll, sales, use, employment, property, withholding, escheat, excise, production, value added, or other tax, fee, duty, tariff, assessment or other governmental charge of any kind whatever, whether disputed or not, together with all interest, penalties and additions imposed with respect thereto, and any liability for any such tax or charge of any other Person as a transferee or successor, by contract or pursuant to any Law (including Treasury Regulation Section 1.1502-6).

 

“Tax Return” means any return, report, or statement relating to Taxes filed or required to be filed with any Governmental Entity.

 

“Termination Date” has the meaning set forth in Section 9.02(a).

 

“Termination Fee” has the meaning set forth in Section 9.05(b).

 

“Trademarks” has the meaning set forth in the definition of “Intellectual Property”.

 

“Transition Team” has the meaning set forth in Section 7.06(b).