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EXHIBIT 2.1

AGREEMENT AND PLAN OF MERGER

BY AND AMONG

ADECCO, INC.,

JAGUAR ACQUISITION CORP.

and

MPS GROUP, INC.

October 19, 2009


TABLE OF CONTENTS

 

 

  

 

  

PAGE

ARTICLE I

  

THE MERGER

  

1

        1.1

  

The Merger

  

1

        1.2

  

Effective Time

  

2

        1.3

  

Closing

  

2

ARTICLE II

  

SURVIVING CORPORATION

  

2

        2.1

  

Articles of Incorporation

  

2

        2.2

  

Bylaws

  

2

        2.3

  

Directors

  

2

        2.4

  

Officers

  

2

        2.5

  

Subsequent Actions

  

3

ARTICLE III

  

EFFECT OF THE MERGER ON CAPITAL STOCK OF THE COMPANY AND MERGER SUB

  

3

        3.1

  

Share Consideration for the Merger; Conversion or Cancellation of Shares in the Merger

  

3

        3.2

  

Payment for Shares in the Merger

  

4

        3.3

  

Transfer of Shares After the Effective Time

  

5

        3.4

  

Stock Options; Employee Stock Purchase Plan; Restricted Shares

  

5

        3.5

  

Withholding Taxes

  

6

        3.6

  

Recapitalizations; Stock Splits

  

7

ARTICLE IV

  

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

  

7

        4.1

  

Corporate Organization and Qualification

  

7

        4.2

  

Subsidiaries and Affiliates

  

8

        4.3

  

Capitalization

  

8

        4.4

  

Authority Relative to This Agreement; Shareholder Approval

  

9

        4.5

  

Consents and Approvals; No Violation

  

10

        4.6

  

SEC Reports; Financial Statements

  

11

        4.7

  

Absence of Certain Changes or Events

  

12

        4.8

  

Litigation

  

12

        4.9

  

Taxes

  

13

        4.10

  

Employee Benefit Plans; Labor Matters

  

14

        4.11

  

Intellectual Property

  

17

 

i


        4.12

  

Brokers and Finders

  

18

        4.13

  

Opinion of Financial Advisors

  

18

        4.14

  

Material Contracts

  

18

        4.15

  

Insurance

  

20

        4.16

  

Questionable Payments

  

21

        4.17

  

Related Party Transactions

  

21

        4.18

  

Required Vote of Company Shareholders; No Appraisal Rights

  

21

        4.19

  

Customers

  

21

        4.20

  

Properties

  

21

        4.21

  

Compliance with Law

  

22

        4.22

  

Environmental Matters

  

22

        4.23

  

Disclaimer of Other Representations and Warranties

  

23

ARTICLE V

  

REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB

  

23

        5.1

  

Corporate Organization and Qualification

  

23

        5.2

  

Authority Relative to This Agreement

  

23

        5.3

  

Consents and Approvals; No Violation

  

24

        5.4

  

Financing

  

24

        5.5

  

Interim Operations of Merger Sub

  

24

        5.6

  

Share Ownership

  

25

        5.7

  

Brokers and Finders

  

25

        5.8

  

Non-Reliance

  

25

ARTICLE VI

  

ADDITIONAL COVENANTS AND AGREEMENTS

  

25

        6.1

  

Conduct of Business of the Company

  

25

        6.2

  

No Solicitation.

  

28

        6.3

  

Reasonable Best Efforts

  

31

        6.4

  

Access to Information

  

33

        6.5

  

Shareholder Approval

  

34

        6.6

  

Proxy Statement; Other Filings

  

34

        6.7

  

Publicity

  

35

        6.8

  

Indemnification of Directors and Officers

  

36

        6.9

  

Takeover Laws

  

37

        6.10

  

Notification of Certain Matters

  

37

 

ii


        6.11

  

Subsequent Filings

  

37

        6.12

  

Resignation of Company’s Directors

  

37

        6.13

  

Certain Pre-Closing Transactions

  

37

ARTICLE VII

  

CONDITIONS TO CONSUMMATION OF THE MERGER

  

38

        7.1

  

Conditions to Each Party’s Obligations to Effect the Merger

  

38

        7.2

  

Conditions to Obligations of Parent and Merger Sub

  

39

        7.3

  

Conditions to Obligations of the Company

  

39

ARTICLE VIII

  

TERMINATION; AMENDMENT; WAIVER

  

40

        8.1

  

Termination by Mutual Consent

  

40

        8.2

  

Termination by Either Parent or the Company

  

40

        8.3

  

Termination by Parent

  

40

        8.4

  

Termination by the Company

  

41

        8.5

  

Effect of Termination; Fees and Expenses Upon Termination

  

42

        8.6

  

Extension; Waiver

  

44

ARTICLE IX

  

MISCELLANEOUS AND GENERAL

  

44

        9.1

  

Payment of Expenses

  

44

        9.2

  

Non-Survival of Representations and Warranties; Survival of Confidentiality

  

44

        9.3

  

Modification or Amendment

  

44

        9.4

  

Waiver of Conditions

  

45

        9.5

  

Counterparts

  

45

        9.6

  

Governing Law

  

45

        9.7

  

Jurisdiction

  

45

        9.8

  

Notices

  

45

        9.9

  

Entire Agreement; Assignment

  

46

        9.10

  

Parties in Interest

  

47

        9.11

  

Certain Definitions; Drafting Conventions; No Construction Against Drafter

  

47

        9.12

  

Schedules

  

49

        9.13

  

Obligation of Parent

  

49

        9.14

  

Validity

  

50

        9.15

  

Specific Performance

  

50

        9.16

  

Captions

  

50

 

iii


Defined Term

  

Defined in Section

Acquisition Proposal

  

Section 6.2(g)

Adecco

  

Recitals

Adecco Guarantee

  

Recitals

Agreement

  

Introduction

Alternative Acquisition Agreement

  

Section 6.2(d)(1)

Antitrust Filings

  

Section 6.3(b)(y)

Articles of Merger

  

Section 1.2

Board

  

Recitals

Book-Entry Shares

  

Section 3.2(b)(ii)

Breakup Fee

  

Section 8.5(d)

Business Day

  

Section 9.11

Certificates

  

Section 3.2(b)(i)

Change of Board Recommendation

  

Section 6.2(d)(x)

Closing

  

Section 1.3

Closing Date

  

Section 1.3(b)

Code

  

Section 3.5

Company

  

Introduction

Company Board Recommendation

  

Section 4.4(b)(iii)

Company Intellectual Property

  

Section 4.11(b)

Company Plans

  

Section 4.10(a)

Company SEC Reports

  

Section 4.6(a)

Company Securities

  

Section 4.3(a)(iii)

Confidentiality Agreement

  

Section 6.4

Disclosure Schedule

  

Article IV

Effective Time

  

Section 1.2

Environmental Requirements

  

Section 4.22

ERISA

  

Section 4.10(a)(ii)

ERISA Affiliate

  

Section 4.10(a)(ii)

ESPP

  

Section 3.4(c)(i)

ESPP Exercise Date

  

Section 3.4(c)(i)

Exchange Act

  

Section 3.4(b)

FBCA

  

Recitals

GAAP

  

Section 4.6(b)

Governmental Entity

  

Section 4.5(b)

hereby

  

Section 9.11

herein

  

Section 9.11

HSR Act

  

Section 4.5(b)(i)

include

  

Section 9.11

includes

  

Section 9.11

including

  

Section 9.11

Indemnified Parties

  

Section 6.8(a)

Intellectual Property Rights

  

Section 4.11(a)

IRS

  

Section 4.10(a)(i)

knowledge

  

Section 9.11

 

iv


Defined Term

  

Defined in Section

Laws

  

Section 4.21(i)

Liens

  

Section 9.11

Material Adverse Effect

  

Section 9.11

Material Contract

  

Section 4.14(a)

Merger

  

Section 1.1

Merger Consideration

  

Section 3.1(a)

Merger Sub

  

Introduction

Merrill Lynch

  

Section 4.12

Non-U.S. Plan

  

Section 4.10(l)

Notice Period

  

Section 6.2(d)(1)

Option Payment

  

Section 3.4(a)(ii)

Option Plans

  

Section 3.4(a)

Options

  

Section 3.4(a)

Original Date

  

Section 6.5(b)

Other Filings

  

Section 6.6

Parent

  

Introduction

Paying Agent

  

Section 3.2(a)

Payment Fund

  

Section 3.2(a)

Permits

  

Section 4.21(ii)

Person

  

Section 9.11

Preferred Shares

  

Section 4.3(a)

Proxy Statement

  

Section 6.6

Real Property Leases

  

Section 4.20(b)

Related Party Transaction

  

Section 4.17

Representatives

  

Section 6.4

Requisite Shareholder Vote

  

Section 4.18

Restricted Shares

  

Section 3.4(d)

Sarbanes-Oxley Act

  

Section 4.6(a)

SEC

  

Article IV

Securities Act

  

Section 4.6(a)

Share

  

Section 3.1(a)

Shareholders Meeting

  

Section 6.5(a)

Shares

  

Section 3.1(a)

Significant Customer

  

Section 4.19

Significant Subsidiary

  

Section 9.11

Subsidiary

  

Section 9.11

Subsidiary Securities

  

Section 4.3(b)(iii)

Superior Proposal

  

Section 6.2(h)

Surviving Corporation

  

Section 1.1

Takeover Laws

  

Section 9.11

Tax

  

Section 9.11

Tax Returns

  

Section 9.11

Taxes

  

Section 9.11

Termination Date

  

Section 8.2(b)

Unvested Restricted Shares

  

Section 3.4(d)

 

v


Defined Term

  

Defined in Section

Vested Restricted Shares

  

Section 3.4(d)

 

vi


AGREEMENT AND PLAN OF MERGER

This Agreement and Plan of Merger (this “ Agreement ”) is dated as of October 19, 2009, and is by and among Adecco, Inc., a Delaware corporation (“ Parent ”), Jaguar Acquisition Corp., a Florida corporation and wholly owned Subsidiary of Parent (“ Merger Sub ”), and MPS Group, Inc., a Florida corporation (the “ Company ”).

RECITALS

WHEREAS, the Board of Directors of the Company (the “ Board ”) has, subject to the conditions of this Agreement, determined that the Merger (as defined below) is in the best interests of the shareholders of the Company and approved and adopted this Agreement and the transactions contemplated by this Agreement in accordance with the Florida Business Corporation Act (the “ FBCA ”);

WHEREAS, the Boards of Directors of Parent and Merger Sub have each approved, and the Board of Directors of Merger Sub has declared it advisable for Merger Sub to enter into, this Agreement providing for the Merger in accordance with the FBCA, upon the terms and subject to the conditions set forth herein;

WHEREAS, Adecco SA, a Swiss corporation and ultimate parent of Parent and Merger Sub (“ Adecco ”), has agreed to unconditionally guarantee the performance of Parent’s and Merger Sub’s obligations under this Agreement pursuant to a Guarantee of Adecco SA, dated as of even date herewith (the “ Adecco Guarantee ”); and

WHEREAS, Parent, Merger Sub and the Company desire to make certain representations, warranties, covenants and agreements in connection with this Agreement.

NOW THEREFORE, in consideration of the mutual covenants and agreements set forth herein, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:

ARTICLE I

THE MERGER

1.1 The Merger . Subject to the terms and conditions of this Agreement, at the Effective Time (as defined in Section 1.2), the Company and Merger Sub shall consummate a merger (the “ Merger ”) pursuant to which: (a) Merger Sub shall be merged with and into the Company and the separate corporate existence of Merger Sub shall thereupon cease; (b) the Company shall be the successor or surviving corporation in the Merger and shall continue to be governed by the Laws of the State of Florida; and (c) the separate corporate existence of the Company with all its rights, privileges, immunities, powers and franchises shall continue unaffected by the Merger. The corporation surviving the Merger is sometimes referred to in this


Agreement as the “ Surviving Corporation. ” The Merger will have the effects set forth in the FBCA.

1.2 Effective Time . Parent, Merger Sub and the Company will cause appropriate articles of merger (the “ Articles of Merger ”) to be executed and filed on the date of the Closing (as defined in Section 1.3) (or on such other date as Parent and the Company may agree in writing) with the Secretary of State of the State of Florida as provided in the FBCA. The Merger will become effective on the date on which the Articles of Merger have been duly filed with the Secretary of State of the State of Florida, or at such later date as is agreed upon by the parties and specified in the Articles of Merger, and such date is referred to in this Agreement as the “ Effective Time.

1.3 Closing . The parties shall hold the closing of the Merger (the “ Closing ”) (a) at the offices of Jones Day, 1420 Peachtree Street, N.E., Suite 800, Atlanta, Georgia 30309, at 10:00 a.m., local time, as promptly as practicable but in no event later than the second Business Day after the satisfaction or waiver (by the party entitled to grant such waiver) of the conditions set forth in Article VII (other than those conditions that are to be satisfied at the Closing, but subject to the fulfillment or waiver of those conditions at the Closing) or (b) at such other place, time and date as Parent and the Company may agree in writing (the “ Closing Date ”).

ARTICLE II

SURVIVING CORPORATION

2.1 Articles of Incorporation . The articles of incorporation of the Company shall, by virtue of the Merger, be amended and restated in its entirety to read as the articles of incorporation of Merger Sub in effect immediately prior to the Effective Time, except that Article I thereof shall read as follows: “The name of the Corporation is MPS Group, Inc.” and, as so amended, shall be the articles of incorporation of the Surviving Corporation until thereafter amended as permitted by Law.

2.2 Bylaws . The bylaws of the Surviving Corporation, as in effect immediately prior to the Effective Time, shall be amended and restated in their entirety to read as the bylaws of the Merger Sub in effect immediately prior to the Effective Time until thereafter amended as permitted by Law.

2.3 Directors . The directors of Merger Sub at the Effective Time shall, from and after the Effective Time, be the initial directors of the Surviving Corporation until their successors have been duly elected or appointed and qualified or until their earlier death, resignation or removal in accordance with the Surviving Corporation’s articles of incorporation and bylaws.

2.4 Officers . The officers of the Company at the Effective Time shall, from and after the Effective Time, be the initial officers of the Surviving Corporation until their successors have been duly elected or appointed and qualified or until their earlier death, resignation or removal in accordance with the Surviving Corporation’s articles of incorporation and bylaws.

 

2


2.5 Subsequent Actions . If at any time after the Effective Time the Surviving Corporation determines, in its sole discretion, or is advised, that any deeds, bills of sale, assignments, assurances or any other actions or things are necessary or desirable to vest, perfect or confirm of record or otherwise in the Surviving Corporation its right, title or interest in, to or under any of the rights, properties or assets of either of the Company, Parent or Merger Sub acquired or to be acquired by the Surviving Corporation as a result of, or in connection with, the Merger or otherwise to carry out this Agreement, then the officers and directors of the Surviving Corporation shall be authorized to execute and deliver, in the name and on behalf of either the Company, Parent or Merger Sub, all such deeds, bills of sale, instruments of conveyance, 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 or interest in, to and under such rights, properties or assets in the Surviving Corporation or otherwise to carry out this Agreement.

ARTICLE III

EFFECT OF THE MERGER ON CAPITAL STOCK OF THE COMPANY

AND MERGER SUB

3.1 Share Consideration for the Merger; Conversion or Cancellation of Shares in the Merger . At the Effective Time, by virtue of the Merger and without any action on the part of the holders of any Shares or capital stock of Merger Sub:

(a) Each share of common stock of the Company, par value $0.01 per share (each, a “ Share ” and, collectively, the “ Shares ”), issued and outstanding immediately prior to the Effective Time (other than Shares owned by Parent, Merger Sub, or any of their respective wholly owned Subsidiaries, or any of the Company’s direct or indirect wholly owned Subsidiaries or held in the treasury of the Company) will, by virtue of the Merger and without any action on the part of Merger Sub, the Company or the holder thereof, be canceled and extinguished and converted into the right to receive, pursuant to Section 3.2, in cash an amount per Share equal to $13.80 (the “ Merger Consideration ”), payable to the holder thereof, without interest thereon, less any required withholding of Taxes, upon the surrender of the certificate formerly representing such Share or the Book-Entry Shares (as defined in Section 3.2(b)). At 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 such Shares shall cease to have any rights with respect thereto, except the right to receive the Merger Consideration as provided herein.

(b) At the Effective Time, each Share issued and outstanding and owned by Parent, Merger Sub or any of their respective wholly owned Subsidiaries, or held in the treasury of the Company immediately prior to the Effective Time will cease to be outstanding (if applicable), be canceled and retired without payment of any consideration therefor and cease to exist.

(c) At the Effective Time, all Shares (if any) held by any of the Company’s direct or indirect wholly owned Subsidiaries shall remain outstanding and shall become that number of shares of common stock of the Surviving Corporation that bears the same ratio to the aggregate number of outstanding shares of common stock of the Surviving

 

3


Corporation as the number of Shares held by such subsidiary bore to the aggregate number of Shares immediately prior to the Effective Time.

(d) At the Effective Time, each share of common stock, $0.01 par value, of Merger Sub issued and outstanding immediately prior to the Effective Time shall, by virtue of the Merger and without any action on the part of the holder thereof, be converted into and become one validly issued, fully paid and nonassessable share of common stock of the Surviving Corporation.

3.2 Payment for Shares in the Merger . The manner of making payment for Shares in the Merger shall be as follows:

(a) At or immediately after the Effective Time, Parent shall deliver to a paying agent selected by Parent and reasonably acceptable to the Company (the “ Paying Agent ”), for the benefit of the holders of Shares, the funds necessary to make the payments contemplated by Section 3.1 (the “ Payment Fund ”). Parent shall cause the Paying Agent, pursuant to irrevocable instructions, to deliver the Merger Consideration out of the Payment Fund. The Payment Fund shall not be used for any other purpose.

(b) As soon as reasonably practicable after the Effective Time, Parent shall cause the Paying Agent to mail (i) to each holder of record (other than holders of certificates for Shares referred to in Section 3.1(b)) of a certificate or certificates that immediately prior to the Effective Time represented outstanding Shares (the “ Certificates ”): (A) a form of letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to the Certificates shall pass, only upon proper delivery of the Certificates to the Paying Agent); and (B) instructions for use in effecting the surrender of the Certificates for payment therefor, and (ii) to each holder of Book-Entry Shares instructions for use in effecting the surrender of non-certificated Shares held in book-entry form (“ Book-Entry Shares ”) in exchange for the Merger Consideration. Upon surrender of Certificates for cancellation to the Paying Agent, together with such letter of transmittal duly executed and any other required documents, or surrender of Book-Entry Shares, the holder of such Certificates or Book-Entry Shares will be entitled to receive for each of the Shares formerly represented by such Certificates or Book-Entry Shares, the Merger Consideration, without any interest thereon, less any required withholding of Taxes, and the Certificates or Book-Entry Shares so surrendered shall forthwith be canceled. If payment is to be made to a Person other than the Person in whose name a Certificate so surrendered is registered, it will be a condition of payment that the Certificate so surrendered must be properly endorsed and otherwise in proper form for transfer and that the Person requesting such payment must pay to the Paying Agent any transfer or other Taxes required by reason of the payment to a Person other than the registered holder of the Certificate surrendered, or must establish to the satisfaction of the Paying Agent that such Tax has been paid or is not applicable. Until surrendered in accordance with the provisions of this Section 3.2(b), each Certificate (other than Certificates formerly representing Shares held in the Company’s treasury or by Merger Sub, or by any Subsidiary of the Company or Merger Sub) and Book-Entry Share will represent for all purposes only the right to receive, for each Share formerly represented thereby, the Merger Consideration, without interest thereon, less any required withholding of Taxes.

 

4


(c) 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 the Surviving Corporation or the Paying Agent, the posting by such Person of a bond in such reasonable amount as the Surviving Corporation or the Paying Agent may direct as indemnity against any claim that may be made against it with respect to such Certificate, the Paying Agent will deliver in exchange for such lost, stolen or destroyed Certificate the Merger Consideration with respect to the Shares formerly represented thereby.

(d) Any portion of the Payment Fund made available to the Paying Agent that remains unclaimed by the former shareholders of the Company for one year after the Effective Time may be delivered to Parent, upon demand of Parent, and any former shareholders of the Company may thereafter look only to Parent (subject to abandoned property, escheat or other similar Laws) for payment of their claim for the Merger Consideration, without any interest thereon. Neither Parent nor the Surviving Corporation shall be liable to any holder of Shares for any monies delivered from the Payment Fund or otherwise to a public official pursuant to any applicable abandoned property, escheat or similar Law. If any Shares shall not have been surrendered prior to such date as shall be immediately prior to the date that such unclaimed funds would otherwise become subject to any abandoned property, escheat or similar Law, any unclaimed funds payable with respect to such Shares shall, to the extent permitted by applicable Law, become the property of the Surviving Corporation, free and clear of all claims or interest of any Person previously entitled thereto.

3.3 Transfer of Shares After the Effective Time . The Company shall not permit transfers of Shares to be made on the stock transfer books of the Company after the close of business on the day prior to the date of the Effective Time. If, after the Effective Time, Certificates are presented to the Surviving Corporation for transfer, they shall be canceled and exchanged for the Merger Consideration as provided in this Article III.

3.4 Stock Options; Employee Stock Purchase Plan; Restricted Shares .

(a) Prior to the Effective Time, the Board (or, if appropriate, any committee thereof) shall adopt appropriate resolutions and take all other actions necessary and appropriate to provide that, immediately prior to the Effective Time, each option then outstanding to purchase Shares (the “ Options ”) granted under the Company’s 2004 Equity Incentive Plan (and its predecessor plans), 2004 Non-Employee Director Equity Incentive Plan (and its predecessor plans), 2008 Non-Executive Stock Plan, or any other plan, agreement or arrangement (together, the “ Option Plans ”), will be canceled and, in exchange therefor, each former holder of any such canceled Option shall be entitled to receive, in consideration of the cancellation of such Option and in settlement therefor, a payment by the Company in cash of an amount equal to the product of (i) the total number of Shares previously subject to such Option and (ii) the excess, if any, of the Merger Consideration over the exercise price per Share previously subject to such Option (such amounts payable hereunder being referred to as the “ Option Payment ”). From and after the Effective Time, any such canceled Option shall no longer be exercisable by the former holder thereof, but shall only entitle such holder to the payment of the Option Payment, and the Company will use its reasonable best efforts to obtain all necessary consents to ensure that former holders of Options will have no rights other than the right to receive the Option Payment.

 

5


(b) Prior to the Effective Time, Parent and the Company shall take action designed to provide that the treatment of Options pursuant to Section 3.4(a) will qualify for exemption under Rule 16b-3(d) or (e), as applicable, under the Securities Exchange Act of 1934, as amended (the “ Exchange Act ”).

(c) The Company shall take such action as may be necessary to: (i) establish the end of the purchase period in effect as of the date of this Agreement under the Company’s Employee Stock Purchase Plan (the “ ESPP ”) no later than the last day of the offering period ending immediately after the date hereof with respect to any offering otherwise then in effect (the “ ESPP Exercise Date ”); and (ii) suspend any subsequent purchase periods that would otherwise arise after the close of the purchase period currently in effect and prior to the Effective Time. The Company shall exercise reasonable best efforts to terminate the ESPP as of the Effective Time or such earlier date as determined by the Company to be administratively reasonable. In such event, (A) each ESPP participant’s accumulated payroll contributions as of the ESPP Exercise Date that are not withdrawn as of such date shall be applied toward the purchase of Shares in accordance with the terms of the ESPP; and (B) as promptly as reasonably practicable following the ESPP Exercise Date, following the application of accumulated payroll contributions toward the purchase of Shares in accordance with the preceding sentence, Parent shall cause or permit the Company or Merger Sub, as applicable, to return to participants any of their respective accumulated payroll contributions not applied to the purchase of Shares under the ESPP, if any.

(d) Each Share granted subject to vesting or other lapse restrictions pursuant to any Option Plan (collectively, “ Restricted Shares ”) which is outstanding immediately prior to the Effective Time and which by its terms as in effect on the date hereof would vest and become free of such restrictions as of the Effective Time (such Restricted Shares, “ Vested Restricted Shares ”) shall, subject to this Article III, be entitled to receive the Merger Consideration with respect to each such Vested Restricted Share, less any required withholding Taxes. Each Share granted subject to vesting or other lapse restrictions pursuant to any Option Plan which is outstanding immediately prior to the Effective Time and which would not by its terms as in effect on the date hereof vest and become free of such restrictions (such Restricted Shares, “ Unvested Restricted Shares ”) shall be canceled immediately prior to the Closing and shall be replaced with a substantially equivalent award by Parent, the Surviving Corporation or any of their respective Subsidiaries or affiliates which, subject to the holder’s continued employment with Parent, the Surviving Corporation or their respective Subsidiaries or affiliates, shall continue to vest on the same schedule and in accordance with the same terms as set forth in the applicable Option Plan and the applicable award agreement thereunder.

(e) After the Effective Time, all Option Plans shall be terminated and no further Options, Restricted Shares or other rights with respect to Shares shall be granted thereunder.

3.5 Withholding Taxes . Parent, the Surviving Corporation and the Paying Agent shall be entitled to deduct and withhold from the consideration otherwise payable to a holder of Shares, Restricted Shares or Options pursuant to the Merger or this Agreement any stock transfer Taxes and such amounts as are required to be withheld under the Internal Revenue Code of 1986, as amended (the “ Code ”), or any applicable provision of state, local or foreign

 

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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 holder of the Shares, Restricted Shares or Options in respect of which such deduction and withholding was made.

3.6 Recapitalizations; Stock Splits . Notwithstanding anything in this Agreement to the contrary, if, between the date of this Agreement and the Effective Time, there shall have been declared, made or paid any dividend or distribution on the Shares or the issued and outstanding Shares shall have been changed into a different number of Shares or a different class by reason of any stock split, reverse stock split, stock dividend, reclassification, redenomination, recapitalization, split-up, combination, exchange of shares or other similar transaction, the Merger Consideration and any other dependent items shall be appropriately adjusted to provide to the holders of the Shares and Options the same economic effect as contemplated by this Agreement prior to such action and as so adjusted shall, from and after the date of such event, be the Merger Consideration or other dependent item, subject to further adjustment in accordance with this Section 3.6; provided that nothing herein shall be construed to permit (a) the Company to take any action with respect to its securities that is prohibited or not expressly permitted by the terms of this Agreement, or (b) Parent and Merger Sub to pay other than cash in fulfillment of their obligation to pay the Merger Consideration.

ARTICLE IV

REPRESENTATIONS AND WARRANTIES OF THE COMPANY

Except as (i) disclosed in the Company’s annual report on Form 10-K for the year ended December 31, 2008; the Company’s quarterly reports on Form 10-Q for the quarters ended March 31, 2009 and June 30, 2009; the Company’s Current Reports on Form 8-K filed with the Securities and Exchange Commission (the “SEC”) on January 5, 2009, February 5, 2009, April 29, 2009, and July 29, 2009; and the Company’s proxy statement on Schedule 14A filed with the SEC on April 20, 2009 (including any documents incorporated therein by reference and any exhibits to such filings but excluding any amendments thereto filed after the date hereof and any forward-looking disclosures set forth in any risk factor section and in any section relating to forward-looking statements to the extent that they are cautionary, predictive or forward-looking in nature), or (ii) disclosed in the section of the disclosure schedule dated the date of this Agreement and delivered by the Company to Parent with respect to this Agreement prior to the execution hereof (the “ Disclosure Schedule ”) that specifically relates to, or is reasonably apparent on its face to relate to, such Section of Article IV below, the Company represents and warrants to Parent and Merger Sub as follows:

4.1 Corporate Organization and Qualification . Each of the Company and its Significant Subsidiaries (as defined in Section 9.11) is duly organized, validly existing and in good standing under the Laws of its respective jurisdiction of organization, and is duly qualified to do business and in good standing in each jurisdiction where the properties owned, leased or operated, or the business conducted, by it require such qualification, except where failure to so qualify or be in good standing has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect (as defined in Section 9.11). Each of the Company and its Significant Subsidiaries has all requisite corporate power and authority to own its properties and to carry on its business as it is now being conducted except where failure

 

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to have such power and authority has not had and would not reasonably be expected to have, individually or in the aggregate, a Material Adverse Effect. The Company has heretofore made available to Parent complete and correct copies of the articles of incorporation and bylaws (or other similar governing documents) of the Company and each of its Subsidiaries.

4.2 Subsidiaries and Affiliates . Section 4.2 of the Disclosure Schedule sets forth the name and jurisdiction of incorporation of each of the Company’s Subsidiaries. Neither the Company nor any of its Subsidiaries, directly or indirectly, owns any capital stock or other equity securities of any Person or has any direct or


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