Agreement and Plan of Merger

AGREEMENT AND PLAN OF MERGER


AMONG


CAMBREX CORPORATION


BW ACQUISITION CORPORATION


BIOWHITTAKER, INC.


Dated as of August 22, 1997


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TABLE OF CONTENTS


Page


1. THE OFFER..........................................................2


2. THE MERGER.........................................................4
2.1 Merger......................................................4
2.2 Effect of Merger............................................5
2.3 Conversion of Shares........................................5
2.4 Stock Options...............................................5
2.5 Consummation of the Merger..................................6
2.6 Dissenters' Rights..........................................6
2.7 Payment for Shares and Options..............................7
2.8 Closing of the Company's Transfer Books.....................8


3. REPRESENTATIONS AND WARRANTIES.....................................9
3.1 Representations and Warranties of Parent and the Purchaser..9
3.2 Representations and Warranties of the Company..............11


4. COVENANTS.........................................................22
4.1 Acquisition Transactions...................................22
4.2 Interim Operations.........................................24
4.3 Access and Information.....................................26
4.4 Certain Filings, Consents and Arrangements.................26
4.5 Reasonable Best Efforts....................................26
4.6 Public Statements..........................................27
4.7 Stockholder Approval.......................................27
4.8 Stockholder Litigation.....................................29
4.9 Indemnification, Exculpation and Insurance.................29
4.10 Amendment of Rights Agreement..............................30
4.11 Borrowings under the Loan Agreement........................30


5. CONDITIONS........................................................30
5.1 Conditions to the Obligations of Parent, the Purchaser and
the Company ...............................................30
5.2 Conditions to the Obligations of Parent and the Purchaser..31
5.3 Conditions to the Obligations of the Company...............31 3 6. MISCELLANEOUS.....................................................32
6.1 Termination................................................32
6.2 Non-Survival of Representations, Warranties and Agreements.34
6.3 Amendment and Waiver.......................................34
6.4 Entire Agreement...........................................34
6.5 Definitions................................................35
6.6 Applicable Law.............................................35
6.7 Headings...................................................35
6.8 Notices....................................................35
6.9 Counterparts...............................................36
6.10 Severability...............................................36
6.11 Parties in Interest; Assignment............................37
6.12 Fees and Expenses..........................................37
6.13 Specific Performance.......................................38


Annex A Certain Conditions of the Offer


Exhibit A Persons Party to the Stockholder Agreement


Schedule 2.2 Offices of the Surviving Corporation


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AGREEMENT AND PLAN OF MERGER


AGREEMENT AND PLAN OF MERGER dated as of August 22, 1997 by and among Cambrex Corporation, a Delaware corporation ("Parent"), BW Acquisition Corporation, a Delaware corporation and a wholly-owned subsidiary of Parent (the "Purchaser"), and BioWhittaker, Inc., a Delaware corporation (the "Company").


WHEREAS, the respective Boards of Directors of the Parent, the Purchaser and the Company each has determined that it is fair to, and in the best interests of, their respective stockholders for Parent to acquire the Company pursuant to a merger (the "Merger") in which the Purchaser shall be merged with and into the Company pursuant to this Agreement;


WHEREAS, as a condition of the willingness of the Parent to enter into this Agreement, those Persons (as defined in Section 6.5) set forth on Exhibit A hereto, as the holders of shares of the Company's Common Stock, par value $.01 per share (the "Common Stock"), have entered into two separate but substantially identical Stockholder Agreements, each dated as of the date hereof (collectively, the "Stockholder Agreement") with the Parent, which provide, among other things, that, subject to the terms and conditions thereof, each such Person will tender such Person's shares of Common Stock in the Offer (as defined below) and vote such shares of Common Stock in favor of the Merger and the approval and adoption of this Agreement;


WHEREAS, as a condition of the willingness of the Parent to enter into this Agreement (i) the participants of the BioWhittaker, Inc. Supplemental Executive Retirement Plan (the "SERP") have executed an agreement consenting to the termination of the rabbi trust established under the SERP (the "Trust") prior to the payment of any benefits under such Trust and the establishment of a new rabbi trust which was funded prior to execution to this Agreement by the Company with 120,344 shares of Common Stock, (ii) pursuant to that agreement, the other 179,656 shares of Common Stock previously held by the Trust will be returned to the Company and will be canceled and (iii) all other amounts accrued or contributed to the Trust pursuant to Article V of the SERP will be transferred to the new rabbi trust;


WHEREAS, in furtherance thereof, the Parent proposes that the Purchaser make an offer to purchase for cash all of the issued and outstanding shares of Common Stock of the Company, and all associated rights, at a price of $11.625 per share net to the seller; 5
WHEREAS, the Boards of Directors of the Parent, the Purchaser and the Company have approved the Merger following the expiration of such offer, upon the terms and subject to the conditions set forth herein;


NOW THEREFORE, in consideration of the mutual covenants and agreements set forth herein, the parties agree as follows:


1. THE OFFER


1.1 The Offer. (a) As promptly as practicable, but in no event later than five business days after the public announcement of the execution of this Agreement, the Purchaser shall, and the Parent shall cause the Purchaser to, commence a tender offer (the "Offer") to purchase for cash all of the issued and outstanding shares of Common Stock (the "Shares"), together with the associated rights, if any, to purchase Series A participating Cumulative Preferred Stock, par value $.01 per share ("Series A Shares"; and together with the Shares, the "Securities") at a price of not less than $11.625 per Security net to the seller in cash; it being understood that the Offer will not apply to the 179,656 Shares (or associated rights) previously held by the Trust which are being returned to the Company and canceled as described in the third recital to this Agreement. The obligations of the Purchaser and the Parent to consummate the Offer and to accept for payment and purchase the Securities tendered shall be subject only to the conditions set forth in Annex A hereto. The Purchaser shall not without the Company's prior written consent reduce the price per Security or the number of Securities sought to be purchased or modify the form of consideration to be received by holders of the Securities in the Offer, increase the condition (the "Minimum Condition") set forth in clause (i) of the first sentence of Annex A hereto, impose additional conditions to the Offer or amend any term of the Offer in a manner materially adverse to the holders of the Securities. Subject only to the conditions of the Offer set forth in Annex A, the Purchaser shall, and the Parent shall cause the Purchaser to, pay for all of the Securities validly tendered and not withdrawn pursuant to the Offer as soon as legally permissible.


(b) As soon as practicable on the date the Offer is commenced, the Parent and the Purchaser will file with the Securities and Exchange Commission (the "Commission") a Tender Offer Statement on Schedule 14D-1 (together with all supplements or amendments thereto, and including all exhibits, the "Offer Documents"). The Parent and the Purchaser shall give the Company and its counsel a reasonable opportunity to review the Offer Documents prior to the filing of the Offer Documents with the Commission or to the dissemination of the Offer Documents to the stockholders of the


2 6 Company. The Parent and the Purchaser will furnish the Company and its counsel in writing with any comments that the Parent, the Purchaser or their counsel may receive from the Commission or its staff with respect to the Offer Documents, promptly after receipt of such comments.


1.2 Company Action. (a) In connection with the Offer, the Company shall cause its transfer agent to furnish the Purchaser with mailing labels, security position listings and any available listings or computer files containing the names and addresses of record holders of the Shares as of a recent date, and shall furnish to the Purchaser such information and assistance as the Parent or the Purchaser may reasonably request in communicating the Offer to the Company's stockholders. Except for such steps as are necessary to disseminate the Offer Documents, Parent and the Purchaser shall hold in confidence the information contained in such labels, listings and filings, will use such information only in connection with the Offer and, if this Agreement is terminated, will, upon the request of the Company deliver or cause to be delivered to the Company all copies of such information then in its possession or in the possession of its agents or representatives.


(b) The Company hereby consents to the Offer and represents that the Board of Directors of the Company (at a meeting duly called and held at which a quorum was present) as part of its approval of this Agreement has (i) approved the making of the Offer, (ii) determined that each of the Offer and the Merger is fair to and in the best interests of the stockholders of the Company and (iii) resolved to recommend acceptance of the Offer and approval and adoption of this Agreement by the stockholders of the Company (to the extent such approval and adoption is required by applicable law). Promptly after the commencement of the Offer, the Company shall file a Tender Offer Solicitation/Recommendation Statement on Schedule 14D-9 (together with any amendments or supplements thereto, and including all exhibits, the "Schedule 14D-9") with respect to the Offer which shall contain the recommendations of the Board of Directors in favor of the Offer, the Merger and the Agreement, except to the extent that the Board of Directors of the Company shall have withdrawn or modified its approval of the Offer, the Merger and this Agreement in accordance with Section 4.1(b).


1.3 Board of Directors. (a) Promptly upon the purchase by the Purchaser of the Securities pursuant to the Offer and from time to time thereafter, the Purchaser shall be entitled to designate up to the minimum number of directors necessary in order for the result (expressed as a fraction) derived by dividing the number of directors so designated by the total number of directors to be at least equal to the result (expressed as a fraction) derived by dividing the Shares then held by the Purchaser by the total number of Shares then outstanding; provided, however, that until the Effective Time


3 7 (as defined in Section 2.5 hereof) the Board of Directors will have at least two Independent Directors (as defined in Section 1.3(c) hereof). Upon request by the Purchaser, the Company shall use its best efforts promptly, at the Company's election, either to increase the size of the Board or to secure the resignation of such number of directors as is necessary to enable the Purchaser's designees to be elected to the Board, and to cause the Purchaser's designees to be so elected.


(b) The Company's obligations with respect to the election of the Purchaser's designees to the Board of Directors of the Company shall be subject to Section 14(f) of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), and Rule 14f-1 promulgated thereunder. The Company shall promptly take all actions required pursuant to Section 14(f) and Rule 14f-1 in order to fulfill its obligations under this Section 1.3 and shall include in the Schedule 14D-9 such information with respect to the Company and its officers and directors as is required under Section 14(f) and Rule 14f-1. The Parent and the Purchaser will supply to the Company in writing and shall be solely responsible for any information with respect to any of them and their nominees, officers, directors and affiliates required by Section 14(f) and Rule 14f-1.


(c) Following the election or appointment of the Purchaser's designees pursuant to this Section 1.3 and prior to the Effective Time, any amendment to this Agreement or of the Certificate of Incorporation or By-Laws of the Company, any termination of this Agreement by the Company, any extension by the Company of the time for the performance of any of the obligations or other acts of the Parent or the Purchaser and any waiver of any of the Company's rights under this Agreement will require the concurrence of a majority of the directors of the Company then in office who are (i) not designated by the Purchaser nor otherwise affiliated with the Parent or the Purchaser, (ii) are not employees or the Chairman of the Company or any of its subsidiaries and (iii) are not affiliated with Anasco GmbH (the "Independent Directors").


2. THE MERGER


2.1 Merger. Upon the terms and subject to the conditions of this Agreement, and in accordance with the applicable provisions of the Delaware General Corporation Law ("DGCL"), as promptly as practicable following the consummation of the Offer, the Purchaser shall be merged with and into the Company. The Company shall be the surviving corporation in the Merger (sometimes referred to as the "Surviving Corporation") and shall continue its existence under the laws of the State of Delaware.


4 8 The separate existence of the Purchaser shall cease. The name of the Surviving Corporation shall be "BioWhittaker, Inc."


2.2 Effect of Merger. The Certificate of Incorporation and the Bylaws of the Company in effect upon consummation of the Merger shall be the Certificate of Incorporation and Bylaws of the Surviving Corporation. The directors of the Purchaser immediately prior to the Effective Time (as defined in Section 2.5) shall be the directors of the Surviving Corporation, and the officers set forth on Schedule 2.2 hereto shall be the officers of the Surviving Corporation, in each case until their respective successors are duly elected and qualified. The Merger shall have the effects set forth in Section 259 of the DGCL.


2.3 Conversion of Shares. Merger Consideration. At the Effective Time, by virtue of the Merger and without any action on the part of any holder thereof: (a) each Share, together with the associated right, if any, to purchase Series A Shares or other securities of the Company pursuant to the Stockholder Protection Rights Agreement dated January 20, 1995 between the Company and Bank of Boston, as Rights Agent (the "Rights Agreement"), issued and outstanding immediately prior to the Effective Time (other than Shares to be canceled pursuant to clause (b) below and any Dissenting Shares (as defined in Section 2.6)) shall be converted into the right to receive in cash an amount per Share equal to the Merger Consideration (as defined below), subject to any required withholding of taxes and without interest; (b) each Share (together with all associated Series A Shares) owned by Parent, the Purchaser or any other direct or indirect subsidiary of Parent, or held in the treasury of the Company, immediately prior to the Effective Time, shall be canceled and extinguished, and no payment will be made with respect to those Shares; and (c) all shares of common stock of the Purchaser, par value $.01 per share, then issued and outstanding shall be converted into an equal number of shares of common stock of the Surviving Corporation. "Merger Consideration" means (I) $138,948,952, or such greater price divided by (II) the total number of Shares outstanding on a fully diluted basis as of immediately prior to the Effective Time, assuming the exercise of all outstanding Options (as defined below) and including all Shares acquired by Parent or the Purchaser in the Offer.


2.4 Stock Options. Immediately prior to the Effective Time, each then outstanding option to purchase Shares, whether or not then exercisable, including any options granted under the 1994 Stock Option Plan for Non-Employee Directors (collectively, the "Options"), shall be canceled by the Company in exchange for a right to receive a payment in cash in accordance with Section 2.7(b) (the "Option Consideration") equal to the product of (i) the number of Shares previously subject to the Option and (ii) the excess, if any, of the Merger Consideration over the exercise price for each Share


5 9 under such Option. As of the Effective Time, each holder of an Option will be entitled to receive only an amount equal to the Option Consideration. All amounts payable under this Section 2.4 shall be subject to any required withholding of taxes and shall be paid without interest. Effective as of the Effective Time and subject to payment of the Option Consideration, the Company shall cause each stock option or other equity based plan maintained with respect to any Shares (or rights in respect thereof) (other than the BioWhittaker, Inc. Savings and Stock Investment Plan (the "BSSIP") and the BioWhittaker, Inc. Supplemental Executive Retirement Plan (the "SERP")) to be terminated.


2.5 Consummation of the Merger. Upon the terms and subject to the con- ditions of this Agreement, the Company shall execute in the manner required by the DGCL, and deliver to the Secretary of State of the State of Delaware, a duly executed certificate of merger as required by the DGCL, and the parties shall take all such other and further actions as may be required by law to make the Merger effective. Prior to the filing referred to in this Section 2.5, a closing will be held at the offices of Debevoise & Plimpton, 875 Third Avenue, New York, New York, on the third business day following the satisfaction of the condition set forth in Section 5.1(c) hereof (or, in the event the Purchaser shall acquire at least 90% of the outstanding Shares in the Offer, on the tenth business day following the completion of the Offer) (or such other time as the Purchaser and the Company may agree, immediately after the conditions set forth in Article V have been satisfied or waived) for the purpose of confirming all of the foregoing. The time the Merger becomes effective in accordance with applicable law is referred to as the "Effective Time".


2.6 Dissenters' Rights. Notwithstanding any provision of this Agreement to the contrary, any shares of capital stock of the Company outstanding immediately prior to the Effective Time held by a holder who has demanded and perfected the right, if any, for appraisal of those shares in accordance with the provisions of Section 262 of the DGCL and as of the Effective Time has not withdrawn or lost such right to such appraisal ("Dissenting Shares") shall not be converted into or represent a right to receive the consideration set forth in Section 2.3, but the holder shall only be entitled to such rights as are granted by the DGCL. If a holder of shares of capital stock of the Company who demands appraisal of those shares under the DGCL shall effectively withdraw or lose (through failure to perfect or otherwise) the right to appraisal, then, as of the Effective Time or the occurrence of such event, whichever last occurs, those shares shall be converted into and represent only the right to receive the consideration as provided in Section 2.3, without interest, upon the surrender of the certificate or certificates representing those shares. The Company shall give the Parent (i) prompt notice of any written demands for appraisal of any shares of capital stock of the


6 10 Company, attempted withdrawals of such demands, and any other instruments served pursuant to the DGCL received by the Company relating to stockholders' rights of appraisal and (ii) the opportunity to direct all negotiations and proceedings with respect to demands for appraisal under the DGCL. The Company shall not, except with the prior written consent of Parent, voluntarily make any payment with respect to any demands for appraisals of capital stock of the Company, offer to settle or settle any such demands or approve any withdrawal of any such demands.


2.7 Payment for Shares and Options. (a) Shares. Prior to the Effective Time, the Purchaser shall designate a commercial bank or trust company organized under the laws of the United States or any state of the United States with capital, surplus and undivided profits of at least $500,000,000 to act as Paying Agent with respect to the Merger (the "Paying Agent"). Each holder (other than Parent, the Purchaser or any subsidiary of Parent) of a certificate or certificates (the "Certificates") which immediately prior to the Effective Time represented outstanding Shares will be entitled to receive, upon surrender to the Paying Agent of the Certificates for cancellation, cash in an amount equal to the product of the number of Shares previously represented by the Certificates multiplied by the Merger Consideration, subject to any required withholding of taxes. At or prior to the Effective Time, the Purchaser shall make available to the Paying Agent sufficient funds to make all payments pursuant to the preceding sentence. No interest shall accrue or be paid on the cash payable upon the surrender of the Certificates. If payment is to be made to a person other than the person in whose name the Certificates surrendered are registered, it shall be a condition of payment that the Certificates so surrendered shall be properly endorsed or otherwise in proper form for transfer and that the person requesting the payment shall pay any transfer or other taxes required by reason of the payment to a person other than the registered holder of the Certificates surrendered or establish to the satisfaction of the Surviving Corporation that the tax has been paid or is not applicable. Following the Effective Time, until surrendered to the Paying Agent in accordance with the provisions of this Section 2.7(a), each Certificate shall represent for all purposes only the right to receive upon surrender thereof the Merger Consideration multiplied by the number of Shares evidenced by the Certificate, without any interest, subject to any required withholding taxes. Any funds delivered or made available to the Paying Agent pursuant to this Section 2.7(a) and not exchanged for Certificates within six months after the Effective Time will be returned by the Paying Agent to the Surviving Corporation, which thereafter will act as Paying Agent, subject to the rights of holders of unsurrendered Certificates under this Section 2.7(a), and any former stockholders of the Company who have not previously exchanged their Certificates will thereafter be entitled to look only to the Surviving Corporation for payment of their claim for the consideration set forth in Section 2.3, without any interest, but will have no greater


7 11 rights against the Surviving Corporation than may be accorded to general creditors thereof under applicable law. Notwithstanding the foregoing, neither the Paying Agent nor any party hereto shall be liable to a holder of Shares for any cash or interest delivered to a public official pursuant to applicable abandoned property, escheat or similar laws. If any Certificates shall not have been surrendered prior to three years after the Effective Time (or immediately prior to such earlier date on which any payment in respect hereof would otherwise escheat to or become the property of any governmental unit or agency), the payment in respect of such Certificates shall, to the extent permitted by applicable laws, become the property of the Surviving Corporation, free and clear of all claims of interest of any person previously entitled thereto. As soon as practicable after the Effective Time, the Surviving Corporation will cause the Paying Agent to mail to each record holder of Certificates a form of letter of transmittal (which will specify that delivery will be effected, and risk of loss and title to the Certificates will pass, only upon proper delivery of the Certificates to the Paying Agent) and instructions for use in effecting the surrender of the Certificates for payment.


(b) Options. Each holder of an Option, whether or not then exercisable, will be entitled to receive cash in an amount equal to the Option Consideration in respect of such Options (determined in accordance with Section 2.4 hereof), subject to any required withholding taxes and without interest. As soon as practicable after the Effective Time, and in any event no more than fifteen (15) calendar days following the Effective Time, the Surviving Corporation shall instruct the Paying Agent to pay, and the Paying Agent shall so pay, all amounts due as Option Consideration to holders of Options as required by this Agreement.


2.8 Closing of the Company's Transfer Books. At the Effective Time, the stock transfer books of the Company shall be closed and no transfer of Shares converted into the right to receive the Merger Consideration pursuant to the terms hereof, Dissenting Shares or Shares to be canceled pursuant to Section 2.3 hereof shall thereafter be made. If, after the Effective Time, Certificates for such Shares are presented to the Surviving Corporation, they shall be canceled and exchanged for cash or merely canceled, as the case may be, pursuant to and in accordance with Sections 2.3, 2.6 and 2.7 hereof, subject to applicable law in the case of Dissenting Shares.


8 12
3. REPRESENTATIONS AND WARRANTIES


3.1 Representations and Warranties of Parent and the Purchaser. The Parent and the Purchaser represent and warrant to the Company that:


(a) Corporate Organization. Each of the Parent and the Purchaser is a
corporation duly organized, validly existing and in good standing under the
laws of the State of Delaware and has all requisite corporate power to carry
on its business as it is now being conducted; provided, however, that since
it was incorporated, the Purchaser has not engaged in any business other
than organizational matters and matters relating to the Offer and this
Agreement. Parent owns all of the issued and outstanding capital stock of
the Purchaser and all such stock has been validly issued and is fully paid
and nonassessable and is owned by the Parent free and clear of all pledges,
claims, liens, charges, encumbrances and security interests of any kind or
nature whatsoever (collectively, "Liens"). Each of Parent and the Purchaser
is qualified to do business and is in good standing in each jurisdiction in
which the properties owned, leased or operated by it or the nature of the
business conducted by it makes such qualification necessary, except where
the failure to be so qualified and in good standing would not reasonably be
expected, individually or in the aggregate, to have a Material Adverse
Effect on Parent. "Material Adverse Effect" means, with respect to a ...