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Title: |
Agreement and Plan of Merger |
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Date: |
2007 |
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Preview shows 18KB of 250KB total |
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$88 |
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ID: |
#2711694 |
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AGREEMENT AND PLAN OF MERGER
BY AND AMONG
SALTON, INC.,
SFP MERGER SUB, INC.
AND
APN HOLDING COMPANY, INC.
-----------------------------
DATED AS OF FEBRUARY 7, 2007
-----------------------------
================================================================================
{PAGE}
TABLE OF CONTENTS
-----------------
{TABLE}
{CAPTION}
PAGE NO.
--------
{S} {C}
I. DEFINITIONS ................................................................ 2
1.1 Definitions .......................................................... 2
1.2 Interpretation ....................................................... 9
II. MERGER ..................................................................... 9
2.1 The Merger ........................................................... 9
2.2 Certificate of Incorporation and Bylaws .............................. 10
2.3 Directors ............................................................ 10
2.4 Officers ............................................................. 10
III. CONVERSION OF SHARES AND OTHER MATTERS ..................................... 11
3.1 Conversion of Capital Stock .......................................... 11
3.2 Adjustments to Prevent Dilution ...................................... 11
3.3 Exchange of Certificates ............................................. 12
3.4 Treatment of Strawberry Stock Options and Other Equity Based Awards... 12
3.5 No Further Rights; Stock Transfer Books .............................. 13
3.6 Tax Consequences ..................................................... 13
3.7 Securities Act Exemption and Compliance; Registration Rights ......... 13
IV. REPRESENTATIONS AND WARRANTIES OF PARENT ................................... 14
4.1 Due Organization, Good Standing and Corporate Power .................. 14
4.2 Authorization and Validity of Agreement .............................. 14
4.3 Consents and Approvals; No Violations ................................ 15
4.4 Information to be Supplied ........................................... 15
4.5 Capitalization of Parent and MergerSub ............................... 16
4.6 Absence of Certain Events ............................................ 18
4.7 Litigation ........................................................... 18
4.8 Title to Properties; Encumbrances .................................... 18
4.9 Strawberry SEC Reports; Financial Statements ......................... 19
4.10 No Undisclosed Liabilities ........................................... 20
4.11 Compliance with Law .................................................. 20
4.12 Insurance ............................................................ 20
4.13 Regulatory Matters ................................................... 21
4.14 Broker's or Finder's Fee ............................................. 21
4.15 Taxes, Tax Returns, Tax Treatment .................................... 22
4.16 Employee Benefit Matters ............................................. 22
4.17 Intellectual Property ................................................ 25
4.18 Environmental Liability .............................................. 25
4.19 Material Contracts ................................................... 26
4.20 Labor Relations ...................................................... 26
4.21 State Takeover Laws .................................................. 26
4.22 Voting Requirements; Approval; Board Approval ........................ 27
{/TABLE}
-i-
{PAGE}
{TABLE}
{S} {C}
4.23 Opinion of Parent Financial Advisor .................................. 27
4.24 Transactions with Related Parties .................................... 27
4.25 Customers ............................................................ 28
4.26 Strawberry Rights Agreements ......................................... 28
4.27 MergerSub Formation .................................................. 29
V. REPRESENTATIONS AND WARRANTIES OF APPLE HOLDCO ............................. 29
5.1 Due Organization, Good Standing and Corporate Power .................. 29
5.2 Authorization and Validity of Agreement .............................. 29
5.3 Consents and Approvals; No Violations ................................ 30
5.4 Information to be Supplied ........................................... 30
5.5 Capitalization of Apple Holdco and Apple ............................. 31
5.6 Absence of Certain Events ............................................ 32
5.7 Litigation ........................................................... 32
5.8 Title to Properties; Encumbrances .................................... 32
5.9 Apple SEC Reports; Financial Statements .............................. 33
5.10 No Undisclosed Liabilities. .......................................... 34
5.11 Compliance with Law .................................................. 34
5.12 Insurance ............................................................ 34
5.13 Regulatory Matters ................................................... 35
5.14 Broker's or Finder's Fee ............................................. 35
5.15 Taxes, Tax Returns, Tax Treatment .................................... 36
5.16 Employee Benefit Matters ............................................. 36
5.17 Intellectual Property ................................................ 39
5.18 Environmental Liability .............................................. 39
5.19 Material Contracts ................................................... 40
5.20 Labor Relations ...................................................... 40
5.21 State Takeover Laws .................................................. 40
5.22 Voting Requirements; Approval; Board Approval ........................ 41
5.23 Transactions with Related Parties .................................... 41
5.24 Customers ............................................................ 41
5.25 Apple Holdco ......................................................... 42
VI. COVENANTS .................................................................. 42
6.1 Covenants of Parent .................................................. 42
6.2 Covenants of Apple Holdco ............................................ 45
6.3 Antitrust Clearance .................................................. 47
6.4 Efforts to Close ..................................................... 48
6.5 Confidentiality ...................................................... 49
6.6 Access ............................................................... 49
6.7 Public Announcements ................................................. 49
6.8 Board Recommendation; Strawberry Stockholders Meeting ................ 50
6.9 Preparation of Proxy Statement and Additional Filings ................ 50
6.10 No Solicitation; Other Offers ........................................ 51
6.11 Notification of Certain Matters ...................................... 53
6.12 Fees and Expenses .................................................... 54
6.13 Directors' and Officers' Indemnification and Insurance ............... 54
{/TABLE}
-ii-
{PAGE}
{TABLE}
{S} {C}
6.14 Financing ............................................................ 55
6.15 Litigation ........................................................... 57
6.16 Director Resignations; Appointments .................................. 58
6.17 Post Closing Governance of Parent .................................... 58
6.18 Apple Deregistration ................................................. 58
6.19 Transaction Documents ................................................ 58
VII. CONDITIONS TO THE MERGER..................................................... 58
7.1 Conditions to the Merger ............................................. 58
7.2 Conditions to the Obligations of Apple Holdco ........................ 59
7.3 Conditions to the Obligations of Parent and MergerSub ................ 61
VIII. TERMINATION AND ABANDONMENT ................................................ 62
8.1 Termination .......................................................... 62
8.2 Effect of Termination ................................................ 63
8.3 Fees and Expenses .................................................... 64
IX. MISCELLANEOUS .............................................................. 65
9.1 Nonsurvival of Representations, Warranties and Covenants ............. 65
9.2 Amendment and Modification ........................................... 65
9.3 Waiver of Compliance ................................................. 65
9.4 Notices .............................................................. 66
9.5 Third Party Beneficiaries ............................................ 67
9.6 Successors and Assigns ............................................... 67
9.7 Severability ......................................................... 67
9.8 Governing Law ........................................................ 67
9.9 Submission to Jurisdiction; Waivers .................................. 67
9.10 Specific Performance ................................................. 68
9.11 Counterparts ......................................................... 68
9.12 Entire Agreement ..................................................... 68
9.13 Waiver of Jury Trial ................................................. 68
{/TABLE}
-iii-
{PAGE}
EXHIBITS
Exhibit A Amended Strawberry Certificate of Incorporation
Exhibit B Commitment Agreement
Exhibit C Surviving Corporation Certificate of Incorporation
Exhibit D Surviving Corporation Bylaws
Exhibit E Registration Rights Agreement
Exhibit F Apple Holdco Stockholder Agreement
-iv-
{PAGE}
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (this "Agreement"), is dated as of
February 7, 2007, by and among Salton, Inc., a Delaware corporation ("Parent"),
SFP Merger Sub, Inc., a Delaware corporation ("MergerSub") and a wholly owned
direct subsidiary of Parent, and APN Holding Company, Inc., a Delaware
corporation ("Apple Holdco") and the direct parent of Applica Incorporated, a
Florida corporation ("Apple").
RECITALS
A. Each of the boards of directors of Parent (acting upon the unanimous
recommendation of the Special Committee), MergerSub and Apple Holdco has
approved and declared advisable the business combination transaction
contemplated by this Agreement in which MergerSub will merge with and into Apple
Holdco (the "Merger"), with Apple Holdco being the surviving corporation (as
such, the "Surviving Corporation"), all on the terms and subject to the
conditions set forth in this Agreement.
B. By virtue of the Merger, all of the issued and outstanding shares of
common stock, par value $0.01 per share, of Apple Holdco (the "Apple Holdco
Common Stock") will be converted into the right to receive fully paid and non
assessable shares of common stock, par value $0.01 per share, of Parent (the
"Strawberry Common Stock").
C. Parent's board of directors (acting upon the unanimous recommendation
of the Special Committee) has approved and has resolved to recommend to Parent's
stockholders that they approve (i) the issuance of Strawberry Common Stock to be
issued to the stockholders of Apple Holdco in connection with the Merger (the
"Share Issuance") and (ii) an amendment of the Certificate of Incorporation of
Parent to be effected contemporaneously with the consummation of the Merger such
that, after giving effect thereto, the Certificate of Incorporation of Parent
shall be substantially in the form attached hereto as Exhibit A (the "Strawberry
Charter Amendment").
D. Concurrently with the execution of this Agreement, and as a condition
to the willingness of Parent to enter into this Agreement, Apple Holdco and each
of the Apple Holdco Stockholders will enter into a commitment agreement in the
form attached hereto as Exhibit B, pursuant to which the Apple Holdco
Stockholders will, among other things, agree (i) to execute and deliver, and not
to revoke or modify, the unanimous written consent of the Apple Holdco
Stockholders approving the Transactions and (ii) not to transfer any of their
shares of Apple Holdco Common Stock (the "Commitment Agreement");
E. Contemporaneously with, and as a condition to Closing, Parent and each
of the Apple Holdco Stockholders will enter into an agreement in the form
attached hereto as Exhibit F, pursuant to which the Apple Holdco Stockholders
will agree to restrictions on certain activities in respect of the shares of
Strawberry Common Stock issued in the Merger, corporate governance and other
related corporate matters (the "Apple Holdco Stockholder Agreement"); and
-1-
{PAGE}
F. For federal income tax purposes, the Merger will constitute a
reorganization within the meaning of Section 368(a)(1)(A) and 368(a)(2)(E) of
the Code and the exchange of Apple Holdco Common Stock for Strawberry Common
Stock pursuant to the Merger will constitute an exchange of securities in
pursuance of a plan of reorganization within the meaning of Section 354(a) of
the Code.
Accordingly, the parties agree as follows:
I. DEFINITIONS
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