AGREEMENT
AND
PLAN OF MERGER
dated as of
March 2, 2000
by and among
AVNET, INC.
and
TACTFUL ACQUISITION CORP.
and
SAVOIR TECHNOLOGY GROUP, INC.
Table of Contents
Page
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ARTICLE I
THE MERGER
1.1 The Merger 1 1.2 Closing 2 1.3 Effective Time 2 1.4 Certificate of Incorporation 2 1.5 By-Laws 2 1.6 Officers and Directors 2 1.7 Conversion of Shares 2 1.8 Surrender of Shares; Transfer Books 4 1.9 Options and Warrants 6 1.10 Affiliates 7
ARTICLE II
REPRESENTATIONS AND
WARRANTIES OF COMPANY
2.1 Organization; Subsidiaries 7 2.2 Capitalization 8 2.3 Authority; Validity 9 2.4 No Conflict 10 2.5 Consents 10 2.6 Financial Statements; SEC Filings 11 2.7 Tax Matters 12 2.8 Absence of Certain Changes or Events 13 2.9 Material Contracts; Customers and 13
Suppliers 2.10 Title and Related Matters 14 2.11 Employee Benefit Plans 15
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---- 2.12 Employment Agreements 18 2.13 Legal Proceedings 18 2.14 Compliance with Law; Accuracy of 18
Certain Information 2.15 Accuracy of Proxy and Registration 18
Statement and Other Information 2.16 Insurance 19 2.17 Environmental Matters 19 2.18 Certain Agreements 20 2.19 Intellectual Property 20 2.20 Product Warranties 22 2.21 Labor Matters 22 2.22 Related Party Transactions 22 2.23 State Takeover Statutes 22 2.24 Brokers; Advisors 23 2.25 Full Disclosure 23
ARTICLE III
REPRESENTATIONS AND
WARRANTIES OF PARENT AND
BUYER
3.1 Organization 23 3.2 Authority; Validity 23 3.3 No Conflict 24 3.4 Consents 24 3.5 Legal Proceedings 24 3.6 Financial Statements, SEC Filings 24 3.7 No Material Adverse Effect 25 3.8 Compliance with Law 25 3.9 Accuracy of Proxy and Registration 25
Statement and Other Information 3.10 Full Disclosure 26
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---- 3.11 No Brokers or Finders 26
ARTICLE IV
COVENANTS
4.1 Access and Information 26 4.2 Governmental Filings 27 4.3 Consents and Approvals 27 4.4 Meeting of Shareholders; Proxy and 28
Registration Statement; Listing
Application
(a) Meeting of Shareholders 28
(b) Proxy and Registration Statement 28
(c) Indemnification 29
(d) Listing Application 29 4.5 Conduct of Company Business 29
(a) Ordinary Course 29
(b) Charter Documents 29
(c) Dividends 29
(d) Stock 30 4.6 Publicity 30 4.7 Notification of Defaults and Adverse 30
Events 4.8 Satisfy Conditions to Closing 30 4.9 Termination Fee 30 4.10 Anti-takeover Statutes 30 4.11 Indemnification; Insurance 31
(a) Indemnification 31
(b) Insurance 32 4.12 Employee Benefits 32 4.13 No Solicitation 32 4.14 Consent of Holders of Options 33 4.15 Redemption of Class B Preferred Stock 34
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---- 4.16 Audited Financial Statements 34
ARTICLE V
CONDITIONS
5.1 Conditions to Obligations of Company, 34
Parent and Buyer
(a) Approval 34
(b) Approval from Government Entities 34
(c) Absence of Governmental Litigation 34
(d) Effectiveness of Registration 34
Statement
(e) Market Conditions 34 5.2 Conditions to Obligations of Parent and 35
Buyer
(a) Representations and Compliance 35
(b) Tax Opinion 35
(c) No Material Adverse Effect 35
(d) Material Contracts 35
(e) Consent of Option Holders 35
(f) Audited Financial Statements 35 5.3 Conditions to Obligations of Company 36
(a) Representations and Compliance 36
(b) Tax Opinion 36
(c) Listing 36
(d) No Material Adverse Effect 36
ARTICLE VI
TERMINATION, AMENDMENT AND
WAIVER
6.1 Termination and Abandonment 36 6.2 Effect of Termination 37
Page 6.3 Amendment 38 6.4 Extension; Waiver 38
ARTICLE VII
MISCELLANEOUS
7.1 Termination of Representations and 38
Warranties 7.2 Expenses 38 7.3 Remedies 38 7.4 Notices 38 7.5 Further Assurances 39 7.6 Assignability 39 7.7 Governing Law 39 7.8 Interpretation 40 7.9 Counterparts 40 7.10 Integration 40
ARTICLE VIII
DEFINITIONS
8.1 Definitions 40
Annexes
Annex A Inducement Agreement
Annex B Option Agreement
Annex C Affiliate Letter
Schedules
Schedule 2.1 Capitalization of Company and Company's
Subsidiaries
Schedule 2.2(a) Rights to Acquire Company Common Stock
Schedule 2.4 Company Required Consents
Schedule 2.8 Certain Events Company
Schedule 2.9 Material Contracts; Customers and Suppliers
Schedule 2.10 Certain Property or Assets
Schedule 2.11(a) Company Employee Benefit Plans
Schedule 2.11(b) Certain Company Benefit Plan Operations
Schedule 2.11(d) Certain Company Benefit Plan Contributions
Schedule 2.11(e) Certain Company Benefit Plan Matters
Schedule 2.11(i) Certain Company Benefits
Schedule 2.12 Employment Agreements
Schedule 2.13 Legal Proceedings
Schedule 2.14 Compliance with Law
Schedule 2.14(ii) Accuracy of Certain Information
Schedule 2.16 Company Insurance Policies
Schedule 2.17 Certain Environmental Matters
Schedule 2.19 Intellectual Property
Schedule 2.20 Product Warranties
Schedule 2.22 Related Party Transactions
Agreement and Plan of Merger
THIS AGREEMENT and PLAN OF MERGER (this "Agreement") is entered into as of March 2, 2000 by and among Avnet, Inc., a New York corporation ("Parent"), Tactful Acquisition Corp., a Delaware corporation and a wholly-owned subsidiary of Parent ("Buyer"), and Savoir Technology Group, Inc., a Delaware corporation ("Company").
Recitals
WHEREAS, the respective Boards of Directors of Parent, Buyer and Company have each approved the acquisition of Company upon the terms and subject to the conditions set forth herein;
WHEREAS, to induce Parent and Buyer to enter into this Agreement, (i) certain beneficial and record holders of capital stock of Company are entering into an Inducement Agreement (the "Inducement Agreement") to vote their capital stock of Company in favor of the transactions contemplated by this Agreement, in the form of Annex A to this Agreement, and (ii) Company is entering into an Option Agreement (the "Option Agreement") granting Parent the right to acquire 2,023,435 shares of the common stock, par value $.01 per share, of Company ("Company Common Stock") representing 15% of the currently outstanding shares of Company Common Stock upon the terms and conditions set forth therein, in the form of Annex B to this Agreement;
WHEREAS, Parent, Buyer and Company desire to make certain representations, warranties, covenants and agreements in connection with this Agreement and prescribe various conditions to the Merger (as such term is defined below).
Agreement
NOW, THEREFORE, in consideration of the foregoing premises and of the representations, warranties, covenants and agreements contained herein, 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 below), Buyer will be merged with and into Company and the separate corporate existence of Buyer will thereupon cease (the "Merger"). Company will be the surviving corporation in the Merger (sometimes hereinafter referred to as the "Surviving Corporation") and will continue to be governed by the laws of the State of Delaware. The separate corporate existence of Company with all its rights, privileges, immunities, powers and
franchises will continue unaffected by the Merger and Company will succeed to all of the rights and properties of Buyer and will be subject to all of the debts and liabilities of Buyer.
1.2 Closing. The closing of the transactions contemplated hereby (the "Closing") will take place (i) at the offices of Parent at 10:00 A.M., Pacific Standard time on the second business day after the day on which the last of the conditions set forth in Article V is fulfilled or waived in accordance with this Agreement or (ii) at such other place and time or on such other date as the parties hereto may agree (the date of the Closing, the "Closing Date").
1.3 Effective Time. Subject to the provisions of this Agreement and provided that this Agreement has not been terminated or abandoned pursuant to Article VI, a certificate of merger (the "Certificate of Merger") shall be duly prepared, executed and acknowledged by Company and thereafter filed with the Secretary of State of Delaware in accordance with Section 251 of the General Corporation Law of the State of Delaware (the "DGCL"), on or as soon as practicable after the Closing Date. The Merger will become effective immediately upon the filing of the Certificate of Merger (or, if the Certificate of Merger provide for a subsequent time for effectiveness, at the time thereafter so provided in the Certificate of Merger); the time of such effectiveness is hereinafter referred to as the "Effective Time"; and the date of such effectiveness is hereinafter referred to as the "Effective Date."
1.4 Certificate of Incorporation. The Certificate of Incorporation of Company in effect immediately prior to the Effective Time will be the Certificate of Incorporation of the Surviving Corporation at and after the Effective Time until duly amended in accordance with the terms thereof and the applicable provisions of the DGCL.
1.5 By-Laws. The By-Laws of Company in effect immediately prior to the Effective Time will be the By-Laws of the Surviving Corporation at and after the Effective Time until duly amended in accordance with the terms thereof and the applicable provisions of the DGCL; provided, however, that as of the Effective Time, the second sentence of Section 3.2 of the By-Laws of Company shall be amended to read in its entirety as follows: "The Board of Directors shall consist of two directors, until such time as the Board of Directors modifies such number by amendment to this Section 3.2."
1.6 Officers and Directors. The persons serving as directors of Buyer immediately prior to the Effective Time shall be the initial directors of the Surviving Corporation at and after the Effective Time, and the individuals specified by Parent in writing prior to the Effective Time shall be the initial officers of the Surviving Corporation at and after the Effective Time, in each case 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 Certificate of Incorporation and By-Laws.
1.7 Conversion of Shares. Except as otherwise provided herein, at the Effective Time:
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(a) Each share of Company Common Stock issued and outstanding immediately prior to the Effective Time (other than shares canceled pursuant to this Section 1.7) shall, by virtue of the Merger and without any action on the part of the holder thereof, be converted into the right to receive a number of fully paid and nonassessable shares of Common Stock of Parent, par value $1.00 per share ("Parent Stock") equal to the number derived by dividing $7.85 by the Exchange Price (the "Stock Merger Consideration"); provided, however, that if between the date of this Agreement and the Effective Time the outstanding shares of Company Common Stock shall have been changed into a different number of shares or a different class, by reason of any stock dividend, subdivision, reclassification, recapitalization, split, combination, or exchange of shares, the Stock Merger Consideration to be received by the stockholders of the Company shall be appropriately and correspondingly adjusted to reflect such stock dividend, subdivision, reclassification, recapitalization, split, combination or exchange of shares.
(i) The Exchange Price shall be determined as follows:
(A) If the Closing Price is less than $50.6654, the Exchange Price
shall be $50.6654.
(B) If the Closing Price is equal to or greater than $50.6654 and not
greater than $68.5472, the Exchange Price shall be the Closing Price.
(C) If the Closing Price is greater than $68.5472, the Exchange Price
shall be $68.5472.
(ii) For purposes of calculating the Exchange Price in Section 1.7(a), the term "Closing Price" means the average of the closing trade prices of Parent Stock for the fifteen consecutive trading days ending on the fifth trading day before the date of the meeting of Company's shareholders to vote with respect to the Merger and this Agreement (the "Company Shareholders Meeting"), as reported on the New York Stock Exchange Composite Tape.
(b) Each share of Class A Preferred Stock of Company (collectively, the "Class A Preferred Shares" and, collectively with the Company Common Shares, the "Company Shares") 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 the right to receive the number of shares of Parent Stock derived by dividing $9.6581 by the Exchange Price.
(c) Each Company Common Share held immediately prior to the Effective Time by Company, Parent or Buyer or any of their wholly-owned subsidiaries (other than shares held in trust or otherwise in a representative capacity) (the "Canceled Shares") shall be retired automatically, and no consideration shall be payable with respect thereto.
(d) Each share of common stock of Buyer, par value $.01 per share, issued and outstanding immediately prior to the Effective Time shall, by virtue of the Merger and without
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any action on the part of the holder thereof, be converted into one share of common stock, par value $.01 per share, of the Surviving Corporation.
1.8 Surrender of Shares; Transfer Books.
(a) Exchange Agent. Before the mailing of the Proxy and Registration Statement, Parent (with the consent of Company, which will not be unreasonably withheld) will appoint a bank or trust company to act as exchange agent (the "Exchange Agent") for the payment of the Merger Consideration. Parent will furnish the Exchange Agent forthwith upon the Effective Time with cash and certificates representing such number of shares of Parent Stock as the Exchange Agent shall require in order to transmit the Merger Consideration to shareholders surrendering certificates that immediately prior to the Effective Time represented Company Shares in accordance with paragraph (b) of this Section 1.8.
(b) Exchange Procedures for Shares of Company Common Stock. As soon as practicable after the Effective Time, Parent shall cause the Exchange Agent to transmit to each holder of record of a certificate that immediately prior to the Effective Time represented Company Shares (i) a letter of transmittal (which shall specify that delivery shall be effected, and risk of loss and title to such certificates shall pass, only upon proper delivery of the certificates to the Exchange Agent and shall be in customary form) and (ii) instructions for use in effecting the surrender of such certificates in exchange for the Merger Consideration. Each holder of an outstanding certificate or certificates which immediately prior to the Effective Time represented Company Shares shall, upon surrender to the Exchange Agent of such certificate or certificates in accordance with such letter of transmittal, duly executed, and acceptance thereof by the Exchange Agent, be entitled to a certificate or certificates representing the number of full shares of Parent Stock, if any, to be received by the holder thereof pursuant to this Agreement and the cash, if any, payable in lieu of any fractional shares. The Exchange Agent will accept such certificates upon compliance with such reasonable terms and conditions as the Exchange Agent may impose to effect an orderly exchange thereof in accordance with normal exchange practices. After the Effective Time, there will be no further transfer on the records of the Surviving Corporation or its transfer agent of Company Shares which have been converted pursuant to this Agreement into the right to receive the Merger Consideration, and if certificates that immediately prior to the Effective Time represented Company Shares are presented to the Surviving Corporation for transfer, they will be canceled against delivery of certificates for Parent Stock (and cash to the extent required by Section 1.8(e)). If any certificate for such Parent Stock is to be issued in, or if cash is to be remitted to, a name other than that in which the certificate that formerly represented Company Shares surrendered for exchange is registered, it will be a condition of such exchange that the certificate so surrendered will be properly endorsed, with signature guaranteed, or otherwise in proper form for transfer and that the person requesting such exchange will pay to the Surviving Corporation or its transfer agent any transfer or other taxes required by reason of the issuance of certificates for such Parent Stock in a name other than that of the registered holder of the certificate surrendered, or establish to the satisfaction of the Surviving Corporation or its transfer agent that such tax has been paid or is not applicable. Until surrendered as
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contemplated by this Section 1.8(b), each certificate that formerly represented Company Shares which have been converted into the right to receive the Merger Consideration will be deemed at any time after the Effective Time to represent only the right to receive upon such surrender the Merger Consideration as contemplated by Section 1.7 and Section 1.8(e). No interest will be paid or will accrue on any cash payable in lieu of any fractional shares of Parent Stock.
(c) Distributions with Respect to Unexchanged Shares. No dividends or other distributions with respect to Parent Stock with a record date after the Effective Time will be paid to the holder of any unsurrendered certificate that formerly represented Company Shares with respect to the shares of Parent Stock to be received in respect thereof and no cash payment in lieu of fractional shares will be paid to any such holder pursuant to Section 1.8(e) until the surrender of such certificate in accordance with this Article I. Subject to the effect of applicable laws, following surrender of any such certificate, there will be paid to the holder of the certificate representing whole shares of Parent Stock issued in connection herewith, without interest, (i) at the time of such surrender the amount of any cash payable in lieu of a fractional share of Parent Stock to which such holder is entitled pursuant to Section 1.8(e) and the proportionate amount of dividends or other distributions with a record date after the Effective Time theretofore paid with respect to such whole shares of Parent Stock, and (ii) at the appropriate payment date, the proportionate amount of dividends or other distributions with a record date after the Effective Time but before such surrender and a payment date subsequent to such surrender payable with respect to such whole shares of Parent Stock.
(d) No Further Ownership Rights in Company Common Stock. All Merger Consideration paid upon the surrender for exchange of certificates that formerly represented Company Shares in accordance with the terms of this Article I will be deemed to have been issued and paid in full satisfaction of all rights pertaining to the Company Shares represented by such certificates.
(e) No Fractional Shares; Exchange Agent.
(1) No Fractional Shares. No fractional shares of Parent Stock and no
certificates or scrip representing fractional shares of Parent Stock will
be issued in connection with the Merger, and such fractional share
interests will not entitle the owner thereof to vote or to any rights of a
shareholder of the Surviving Corporation after the Merger.
(2) Cash Payment in Lieu of Fractional Shares. Each record holder of
Company Shares converted pursuant to the Merger who would otherwise have
been entitled to receive a fraction of a share of Parent Stock (after
taking into account all Company Shares held by such holder) will be
entitled to receive, in lieu thereof upon surrender of the certificates
that immediately prior to the Effective Time represented Company Shares, a
cash payment (without interest) in lieu of such fractional share in an
amount equal to the product of such fraction multiplied by the Exchange
Price.
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(3) Termination of Exchange Agent's Duties. Any holders of
certificates that immediately prior to the Effective Time represented
Company Shares who have not complied with this Article I within six months
after the Effective Time will thereafter look only to Parent for payment of
the Merger Consideration.
(4) No Liability. None of Parent, Buyer, Company or the Exchange Agent
will be liable to any person in respect of any shares of Parent Stock (or
dividends or distributions with respect thereto) or cash delivered to a
public official pursuant to any applicable abandoned property, escheat or
similar law. If any certificates that immediately prior to the Ef ...
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