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Title: |
Agreement and Plan of Merger |
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Date: |
2007 |
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Preview shows 22KB of 222KB total |
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$60 |
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#2840314 |
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AGREEMENT AND PLAN OF MERGER
AMONG
PACTIV CORPORATION,
MEADOW ACQUISITION CORP.,
PRAIRIE PACKAGING, INC.
===============================================================================
AND
EARL W. SHAPIRO AND BENJAMIN M. SHAPIRO
AS REPRESENTATIVES OF THE COMPANY STOCKHOLDERS
APRIL 10, 2007
{PAGE}
{TABLE}
{S} {C}
ARTICLE I DEFINITIONS.................................................................................1
1.1 Definitions.........................................................................................1
1.2 Interpretation.....................................................................................10
ARTICLE II THE MERGER.................................................................................10
2.1 The Merger.........................................................................................10
2.2 Effective Time.....................................................................................10
2.3 Effect of the Merger...............................................................................11
2.4 Certificate of Incorporation; Bylaws...............................................................11
2.5 Directors and Officers.............................................................................11
ARTICLE III MERGER CONSIDERATION; CONVERSION OF SECURITIES; EXCHANGE OF CERTIFICATES...................11
3.1 Calculation and Payment of the Merger Consideration................................................11
3.2 Effect of Merger on the Capital Stock of the Company...............................................14
3.3 Post-Closing Adjustment............................................................................16
3.4 Lost, Stolen and Destroyed Certificates............................................................17
3.5 Effect of Merger on Capital Stock of Surviving Corporation.........................................17
3.6 Appraisal Rights...................................................................................18
3.7 Withholding Rights.................................................................................18
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF THE COMPANY..............................................19
4.1 Organization, Qualification, Power and Authority...................................................19
4.2 Authorization; Enforceability......................................................................19
4.3 Capitalization.....................................................................................19
4.4 Noncontravention...................................................................................20
4.5 Brokers' Fees......................................................................................20
4.6 Financial Statements...............................................................................20
4.7 Internal Controls; Undisclosed Liabilities.........................................................20
4.8 Events Subsequent to Most Recent Financial Statements..............................................21
4.9 Legal Compliance...................................................................................22
4.10 Tax Matters........................................................................................22
4.11 Real Property......................................................................................23
4.12 Personal Property..................................................................................23
4.13 Intellectual Property..............................................................................23
4.14 Contracts..........................................................................................24
4.15 Litigation.........................................................................................25
4.16 Employee Benefits..................................................................................26
4.17 Environmental Matters..............................................................................26
4.18 Indebtedness.......................................................................................27
4.19 Bank Accounts; Directors and Officers..............................................................27
4.20 Licenses and Permits...............................................................................27
4.21 Labor Matters......................................................................................27
4.22 Insurance Policies.................................................................................27
4.23 Customers and Suppliers............................................................................28
4.24 Title and Sufficiency of Assets....................................................................28
{/TABLE}
i
{PAGE}
{TABLE}
{S} {C}
ARTICLE V REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB....................................28
5.1 Organization of Parent and Merger Sub..............................................................28
5.2 Ownership of Merger Sub; No Prior Activities.......................................................28
5.3 Authorization; Enforceability......................................................................28
5.4 Noncontravention...................................................................................29
5.5 Brokers' Fees......................................................................................29
5.6 Litigation.........................................................................................29
5.7 Financing..........................................................................................29
5.8 Investment Representation..........................................................................29
ARTICLE VI PRE-CLOSING COVENANTS OF THE COMPANY.......................................................30
6.1 Conduct of Business................................................................................30
6.2 Filings; Consents; Etc.............................................................................31
6.3 Exclusivity........................................................................................32
6.4 Publicity..........................................................................................32
6.5 Access.............................................................................................33
6.6 Financial Statements...............................................................................33
6.7 Environmental Matters..............................................................................33
6.8 Lease Obligations; UCC Filings.....................................................................33
6.9 Deferred Compensation Plan.........................................................................33
ARTICLE VII COVENANTS OF PARENT........................................................................34
7.1 Filings; Consents; Etc.............................................................................34
7.2 Publicity..........................................................................................34
7.3 IRB Letter of Credit...............................................................................35
ARTICLE VIII CONDITIONS PRECEDENT TO THE CLOSING........................................................35
8.1 Conditions Precedent to Each Party's Obligations...................................................35
8.2 Conditions Precedent to Obligations of Parent and Merger Sub.......................................35
8.3 Conditions Precedent to Obligations of the Company.................................................36
ARTICLE IX CLOSING....................................................................................37
9.1 Deliveries by the Company..........................................................................37
9.2 Deliveries by Parent and Merger Sub................................................................38
ARTICLE X POST CLOSING COVENANTS.....................................................................38
10.1 Tax Covenants......................................................................................38
10.2 Section 338(h)(10) Election........................................................................41
10.3 Further Assurances.................................................................................42
10.4 Director and Officer Liability and Indemnification.................................................42
10.5 Employee Matters...................................................................................43
10.6 Litigation Support.................................................................................44
{/TABLE}
ii
{PAGE}
{TABLE}
{S} {C}
ARTICLE XI INDEMNIFICATION............................................................................44
11.1 Survival of the Company's Representations and Warranties...........................................44
11.2 Survival of Parent's and Merger Subs' Representations and Warranties...............................44
11.3 Indemnification by the Company Stockholders Relating to the Company................................44
11.4 Indemnification by Parent..........................................................................45
11.5 Indemnification Procedure for Third Party Claims...................................................46
11.6 Calculation of Losses..............................................................................47
11.7 Limitation on Indemnities..........................................................................48
11.8 Escrow.............................................................................................49
11.9 Exclusion of Other Remedies........................................................................49
11.10 Environmental Matters..............................................................................49
ARTICLE XII TERMINATION................................................................................50
12.1 Termination of Agreement...........................................................................50
12.2 Effect of Termination..............................................................................51
ARTICLE XIII MISCELLANEOUS..............................................................................51
13.1 Expenses...........................................................................................51
13.2 No Third-Party Beneficiaries.......................................................................51
13.3 Entire Agreement...................................................................................51
13.4 Succession and Assignment..........................................................................52
13.5 Counterparts.......................................................................................52
13.6 Headings...........................................................................................52
13.7 Notices............................................................................................52
13.8 Governing Law......................................................................................53
13.9 Arbitration........................................................................................54
13.10 Amendments and Waivers.............................................................................54
13.11 Severability.......................................................................................54
13.12 Construction.......................................................................................54
13.13 Acknowledgements by Parent and Merger Sub..........................................................54
13.14 Incorporation of Exhibits and Schedules............................................................55
13.15 Specific Performance...............................................................................55
13.16 Company Stockholder Representatives................................................................55
13.17 Representation.....................................................................................55
Exhibit A.........Form of Representative Agreement
Exhibit B.........Form of Escrow Agreement
Exhibit C.........Form of Closing Note
Exhibit D.........Form of Non-Competition Agreement
Exhibit 1.1.......Illustrative Calculation of Closing Working Capital
{/TABLE}
iii
{PAGE}
AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER (this "AGREEMENT") is made
and entered into as of April 10, 2007 by and among Pactiv Corporation, a
Delaware corporation ("PARENT"), Meadow Acquisition Corp., a Delaware
corporation and a wholly-owned subsidiary of Parent ("MERGER SUB"), Prairie
Packaging, Inc., a Delaware corporation (the "COMPANY"), and Earl W. Shapiro and
Benjamin M. Shapiro (each individually, a "REPRESENTATIVE" and collectively, the
"REPRESENTATIVES"), on behalf of the Company Stockholders.
RECITALS
WHEREAS, the Board of Directors of each of Parent, Merger Sub
and the Company has approved and declared advisable the merger of Merger Sub
with and into the Company (the "MERGER"), pursuant to which the Company shall
continue as the surviving corporation and as a wholly-owned subsidiary of
Parent, upon the terms and subject to the conditions of this Agreement and in
accordance with the General Corporation Law of the State of Delaware (the
"DGCL");
WHEREAS, the Board of Directors of each of Parent and the
Company has determined that the Merger is in furtherance of and consistent with
their respective business strategies and is in the best interest of their
respective stockholders, and Parent has approved this Agreement and the Merger
as the sole stockholder of Merger Sub, and the Company has received the
Requisite Stockholder Approval;
WHEREAS, pursuant to the Merger, among other things, all of
the issued and outstanding shares of capital stock of the Company shall be
converted into the right to receive the Merger Consideration (as hereafter
defined) as provided herein;
WHEREAS, as a condition to, and in connection with the
execution of this Agreement, certain of the Company Stockholders have entered
into a Stockholders' Representative Agreement (the "REPRESENTATIVE AGREEMENT"),
with the Representatives in the form attached hereto as EXHIBIT A; and
WHEREAS, the parties to this Agreement desire to make certain
representations, warranties, covenants and other agreements in connection with
the Merger.
NOW, THEREFORE, in consideration of the foregoing and the
respective representations, warranties, covenants and agreements set forth in
this Agreement, and other good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged, the parties hereto, intending to be
legally bound hereby, agree as follows:
ARTICLE I
DEFINITIONS
1.1 DEFINITIONS. As used herein, the following terms
shall have the meanings ascribed to them in this SECTION 1.1
{PAGE}
"1995 BONDS" means those certain Industrial Development
Revenue Bonds, Series 1995 (Prairie Project) issued by the Illinois Development
Finance Authority on December 14, 1995 in an original aggregate principal amount
equal to $5,000,000.
"1995 BONDS AMOUNT" means the aggregate amount of outstanding
Indebtedness of the Acquired Companies relating to the 1995 Bonds as of the
Closing Date.
"ACCOUNTING ARBITRATOR" has the meaning set forth in SECTION
3.4(B) below.
"ACQUIRED COMPANIES" means, collectively, the Company and each
of the Prairie Subsidiaries.
"AFFILIATE" has the meaning set forth in Rule 12b-2 of the
regulations promulgated under the Exchange Act.
"AGREEMENT" has the meaning set forth in the introductory
paragraph above.
"AUDITED FINANCIAL STATEMENTS" has the meaning set forth in
SECTION 4.6 below.
"BEST EFFORTS" means the good faith efforts that a prudent
business Person desirous of achieving a result would use in similar
circumstances to ensure that such result is achieved as expeditiously as
possible; PROVIDED, HOWEVER, such efforts shall not require or include the
payment of money by such Person to ensure any such result.
"BOLINGBROOK FACILITY" has the meaning set forth in SECTION
6.7 below.
"BUSINESS" means the business of manufacturing, marketing and
selling certain disposable plastic products and packaging materials as conducted
by the Acquired Companies.
"BUSINESS DAY" means any day other than a Saturday or Sunday,
or a day on which banking institutions in New York, New York or Chicago,
Illinois are authorized or obligated by Law to close.
"CAP AMOUNT" has the meaning set forth in SECTION 11.7(C)
below.
"CASH ON HAND" means all cash and cash equivalents of the
Acquired Companies, as of the close of business on the day immediately preceding
the Closing Date, determined in accordance with GAAP. For the avoidance of
doubt, Cash on Hand shall be calculated net of issued but uncleared checks and
drafts and shall include checks, ACH transactions and other wire transfers and
drafts deposited or available for deposit for the account of the Acquired
Companies.
"CERTIFICATE OF MERGER" has the meaning set forth in SECTION
2.2 below.
"CERTIFICATES" has the meaning set forth in SECTION 3.2(D)
below.
"CLAUSE (IV) PAYMENT" has the meaning set forth in SECTION
3.1(A)(IV) below.
"CLOSING" has the meaning set forth in SECTION 2.2 below.
"CLOSING DATE" has the meaning set forth in SECTION 2.2 below.
2
{PAGE}
"CLOSING NOTE" has the meaning set forth in SECTION 3.1(C)
below.
"CLOSING STATEMENT" has the meaning set forth in SECTION
3.3(A) below.
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