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Agreement and Plan of Merger

 

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Title:

Agreement and Plan of Merger

Entities:

Hoenig Group Inc; Bank of New York; Investment Technology Group Inc.; Skadden, Arps, Slate, Meagher & Flom LLP

Date:

2002

Size:

Preview shows 12KB of 183KB total

Price:

$85

ID:

#1533402

 

 

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<SEQUENCE>3

<FILENAME>s433443.txt
<DESCRIPTION>AGREEMENT AND PLAN OF MERGER
<TEXT>
-----------------------------------------------------------------------------






AGREEMENT AND PLAN OF MERGER


dated as of February 28, 2002


by and among


INVESTMENT TECHNOLOGY GROUP, INC.,


HOENIG GROUP INC.


and


INDIGO ACQUISITION CORP.






-----------------------------------------------------------------------------



<TABLE>
<CAPTION>
TABLE OF CONTENTS

Page

ARTICLE ONE

DEFINITIONS
<S> <C> <C>
SECTION 1.1. Definitions.........................................................1

ARTICLE TWO

THE MERGER

SECTION 2.1. Effective Time of Merger............................................8
SECTION 2.2. Closing.............................................................8
SECTION 2.3. Effects of the Merger...............................................8
SECTION 2.4. Certificate of Incorporation and By-Laws............................9
SECTION 2.5. Officers and Directors..............................................9
SECTION 2.6. Effect on Capital Stock.............................................9
SECTION 2.7. Exchange of Certificates for Merger Consideration..................10
SECTION 2.8. Options............................................................12
SECTION 2.9. Certain Adjustments................................................13

ARTICLE THREE

REPRESENTATIONS AND WARRANTIES

SECTION 3.1. Representations and Warranties of Company..........................14
SECTION 3.2. Representations and Warranties of Parent and Merger Subsidiary.....28

ARTICLE FOUR

COVENANTS RELATING TO CONDUCT OF BUSINESS

SECTION 4.1. Interim Conduct....................................................30
SECTION 4.2. Notice of Certain Events...........................................34

ARTICLE FIVE

ADDITIONAL AGREEMENTS

SECTION 5.1. Preparation of Proxy Statement; Stockholders Meeting...............34
SECTION 5.2. Access to Information..............................................35
SECTION 5.3. Reasonable Best Efforts............................................36
SECTION 5.4. Acquisition Proposals..............................................36
SECTION 5.5. Fees and Expenses..................................................38
SECTION 5.6. Indemnification; Directors' and Officers' Insurance................39
SECTION 5.7. Public Announcements...............................................40
SECTION 5.8. Employee Benefits..................................................40
SECTION 5.9. Additional Agreements..............................................41

ARTICLE SIX

CONDITIONS PRECEDENT

SECTION 6.1. Conditions to Each Party's Obligation To Effect the Merger.........41
SECTION 6.2. Conditions to Obligations of Parent and Merger Subsidiary..........41
SECTION 6.3. Conditions to Obligations of Company...............................42

ARTICLE SEVEN

TERMINATION AND AMENDMENT

SECTION 7.1. Termination........................................................43
SECTION 7.2. Effect of Termination..............................................44
SECTION 7.3. Amendment..........................................................46
SECTION 7.4. Extension; Waiver..................................................46

ARTICLE EIGHT

GENERAL PROVISIONS

SECTION 8.1. Non-survival of Representations, Warranties and Agreements.........46
SECTION 8.2. Notices............................................................46
SECTION 8.3. Interpretation.....................................................47
SECTION 8.4. Counterparts.......................................................47
SECTION 8.5. Entire Agreement; No Third Party Beneficiaries.....................48
SECTION 8.6. Governing Law......................................................48
SECTION 8.7. Waiver of Jury Trial...............................................48
SECTION 8.8. Severability.......................................................48
SECTION 8.9. Assignment.........................................................48
SECTION 8.10. Enforcement........................................................48

Exhibit A Form of Voting Agreement
Exhibit B Form of Certificate of Incorporation of Surviving Corporation
Exhibit C Form of Letter from Holders of Company Options

Schedule I List of Employees Entering into Employment Agreements
</TABLE>




AGREEMENT AND PLAN OF MERGER dated as of February 28, 2002 (this
"Agreement") by and among Investment Technology Group, Inc., a Delaware
corporation ("Parent"), Hoenig Group Inc., a Delaware corporation
("Company"), and Indigo Acquisition Corp. ("Merger Subsidiary"), a Delaware
corporation and a direct wholly owned subsidiary of Parent.

WHEREAS, the boards of directors of Parent, Merger Subsidiary and
Company have approved, and deem it advisable and in the best interests of
their respective stockholders to consummate, the business combination
transaction provided for herein, on the terms and subject to the conditions
hereof, in which Merger Subsidiary would merge with and into Company, with
Company surviving as a wholly-owned subsidiary of Parent (the "Merger");

WHEREAS, as a condition and inducement to Parent's willingness to
enter into this Agreement, Parent, Company and certain stockholders of
Company are entering into an agreement dated as of the date hereof, in the
form of Exhibit A (the "Voting Agreement"), pursuant to which such
stockholders have, among other things, given their proxy to Parent to vote
their shares of Company Common Stock (as defined herein) in favor of the
adoption of this Agreement;

WHEREAS, as a further condition and inducement to Parent's
willingness to enter into this Agreement, Merger Subsidiary, Company or a
Subsidiary of Company and the employees of Company listed on Schedule I are
entering into employment agreements and a consulting agreement
contemporaneously herewith (collectively, the "Management Agreements"); and

WHEREAS, Parent, Merger Subsidiary and Company desire to make
certain representations, warranties and agreements in connection with the
Merger and also to prescribe various conditions to the Merger.

NOW, THEREFORE, in consideration of the foregoing and the
respective representations, warranties, covenants and agreements set forth
herein, the parties hereto agree as follows:

ARTICLE ONE

DEFINITIONS

SECTION 1.1. Definitions. For all purposes in this Agreement, the
following terms shall have the respective meanings set forth in this
Section 1.1 (such definitions to be equally applicable to both the singular
and plural forms of the terms herein defined):

"Acquisition Proposal" has the meaning given in Section 5.4(a).

"Action" has the meaning given in Section 3.1(g).

"Affected Employees" has the meaning given in Section 5.8(a).

"AHA" means Axe-Houghton Associates, Inc., a Delaware corporation
and a wholly owned Subsidiary of Company.

"Average Parent Price" means the average (rounded to the nearest
thousandth) of the closing trading prices of Parent Common Stock on the
NYSE, as reported in The Wall Street Journal, Eastern Edition (or such
other source as the parties shall agree in writing), for the 20 full
trading days ending on the fifth business day immediately preceding the
Closing Date.

"AHA Stock Purchase Agreement" has the meaning given in Section 3.1(t).

"Board of Directors" means the board of directors of Company.

"Cash-out Option" means each Company Option that is listed on the
Cash-out Option Schedule.

"Cash-out Option Schedule" means a schedule delivered by Company
to Parent within 30 days after the date hereof that sets forth (i) the name
of each holder who has elected to have such holder's Company Options
treated as "Cash-out Options" hereunder, (ii) the number of Company Options
as to which such election has been made and (iii) the exercise price for
each such Company Option.

"Certificate of Merger" has the meaning given in Section 2.1.

"Change in Company Recommendation" has the meaning given in
Section 5.1(b).

"Closing" has the meaning given in Section 2.2.

"Closing Date" has the meaning given in Section 2.2.

"Code" means the Internal Revenue Code of 1986, as amended.

"Company" has the meaning given in the first paragraph of this
Agreement.

"Company Certificates" has the meaning given in Section 2.7(a).

"Company Common Stock" means the common stock, par value $0.01, of
Company, including the associated Company Rights.

"Company Contracts" has the meaning given in Section 3.1(i).

"Company Disclosure Schedule" means the disclosure schedule
delivered by Company to Parent concurrently with the execution and delivery
of this Agreement.

"Company Expenses" means all out-of-pocket costs and expenses,
including all fees and expenses of investment bankers, attorneys,
accountants and other advisors, incurred by or on behalf of Company or any
of its Subsidiaries in connection with or related to the Transaction
Agreements and the transactions contemplated thereby, but in no case shall
the Company Expenses exceed $1.0 million.

"Company Option" means an option to purchase shares of Company
Common Stock granted to an employee, consultant, independent contractor or
director.

"Company Permits" means permits, licenses, variances, exemptions,
orders and approvals of all Governmental Entities held by Company or any of
its Subsidiaries (other than AHA or any of its Subsidiaries) which are
material to the operation of their respective businesses.

 

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