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AGREEMENT


AND


PLAN OF REORGANIZATION


AMONG


BERGEN BRUNSWIG CORPORATION
DMC ACQUISITION CORP.
SOUTHEASTERN HOSPITAL SUPPLY
CORPORATION
ELEANOR B. MANNING
RAY MANNING, JR.
BETTY ROUSE
THE O.R. MANNING TRUST
AND
CAROL SHORT


TABLE OF CONTENTS
-----------------
PAGE
---- AGREEMENT AND PLAN OF REORGANIZATION ............................... 1-1


ARTICLE I DEFINITIONS.......................... 1-2


ARTICLE II ACQUISITION PROVISIONS.............. 2-1


2.01 Transfer and Assignment of Assets..... 2-1
2.02 Assets Not Being Acquired............. 2-3
2.03 Assumption And Payment Of Specific
Liabilities......................... 2-4
2.04 Consideration......................... 2-6
2.05 Post Closing Adjustments.............. 2-8
2.06 Adjustment Upon Recapitalization...... 2-9
2.07 Securities Law Matters................ 2-9


ARTICLE III REPRESENTATIONS AND WARRANTIES..... 3-1


ARTICLE IV ADDITIONAL COVENANTS AND AGREEMENTS
OF THE PARTIES...................... 4-1


4.01 Corporate Approval.................... 4-1
4.02 Stockholders' Agreement to Vote....... 4-1
4.03 Conduct Of Business................... 4-1
4.04 Negative Covenants.................... 4-2
4.05 Change of Name........................ 4-4
4.06 Recent Certified Financial Statements. 4-5
4.07 Access................................ 4-5
4.08 Security.............................. 4-6
4.09 Hart-Scott-Rodino Filings............. 4-6
4.10 Bulk Sales Compliance................. 4-7
4.11 Best Efforts.......................... 4-7
4.12 Brokers or Finders.................... 4-8
4.13 Notice to Customers................... 4-8
4.14 Covenants Not to Compete.............. 4-9
4.15 Employment Agreements................. 4-9
4.16 Reserved.............................. 4-9
4.17 Environmental Matters................. 4-9
4.18 Real Estate Matters................... 4-10
4.19 Indebtedness of Employees
and Stockholders.................... 4-10
4.20 Trade Accounts Receivable Aging....... 4-11
4.21 Debit Memos........................... 4-11
4.22 Assets Which May Be Purchased......... 4-11
4.23 Transitional Provisions............... 4-12
4.24 Press Release......................... 4-12
4.25 Exclusive Dealing..................... 4-12
4.26 Insurance Policies.................... 4-13


-i-


ARTICLE V AUDIT................................ 5-1


5.01 Accountant's Reports.................. 5-1
5.02 Asset Value........................... 5-3
5.03 Liability Value....................... 5-4


ARTICLE VI THE CLOSING......................... 6-1


6.01 The Closing........................... 6-1
6.02 Transfer of Title..................... 6-1
6.03 Risk of Loss.......................... 6-2
6.04 Other Aspects of Closing.............. 6-2
6.05 Termination........................... 6-3
6.06 Liability on Termination.............. 6-4


ARTICLE VII CONDITIONS TO THE OBLIGATIONS OF
EACH PARTY......................... 7-1


7.01 No Prohibition of Transaction......... 7-1
7.02 Compliance with Law................... 7-2
7.03 Proceedings, Documentation
and Consents......................... 7-2


ARTICLE VIII CONDITIONS TO THE OBLIGATION OF
PARENT AND SUBSIDIARY............. 8-1


8.01 Representations and Warranties True
at the Closing Date................. 8-1
8.02 No Material Adverse Change:
Officers' Certificates.............. 8-1
8.03 Corporation's Performance............. 8-2
8.04 Necessary Corporate Approvals......... 8-3
8.05 Resolutions Authorizing The
Execution Of This Agreement......... 8-3
8.06 Opinion Of Counsel.................... 8-3
8.07 Investment Letters.................... 8-3
8.08 Satisfactory Searches................. 8-4
8.09 Covenants Not To Compete.............. 8-4
8.10 Employment Agreements................. 8-4
8.11 Environmental Review.................. 8-4
8.12 Listing On New York Stock Exchange.... 8-4
8.13 Consents To Transaction............... 8-4
8.14 Prepayment Of Indebtedness............ 8-5
8.15 Greenville Option and Non-
disturbance Agreement............ 8-5
8.16 Bulk Sales Compliance................. 8-6
8.17 Tax Waivers........................... 8-6
8.18 Results of Investigation.............. 8-6
8.19 Consents to Assignments............... 8-6


-ii-


ARTICLE IX CONDITIONS TO THE CORPORATION'S
OBLIGATION TO CLOSE............... 9-1


9.01 Representations and Warranties
True at the Closing................. 9-1
9.02 Parent's Performance.................. 9-1
9.03 No Material Adverse Change............ 9-2
9.04 Authority............................. 9-2
9.05 Opinion of Parent's Counsel........... 9-2
9.06 Listing on New York Stock Exchange.... 9-3
9.07 Employment Agreements................. 9-3


ARTICLE X SURVIVAL OF REPRESENTATIONS AND
INDEMNIFICATION...................... 10-1


10.01 Survival Of Representations
And Warranties..................... 10-1
10.02 Indemnification By The Corporation
and Stockholders................... 10-1
10.03 Indemnification by Parent............ 10-4
10.04 Enforcement of Indemnification
Rights............................. 10-5
10.05 Remedies Cumulative.................. 10-7
10.06 Liability for Deficiency............. 10-7
10.07 Access to Books and Records.......... 10-8
10.08 Taxes................................ 10-8
10.09 Insurance............................ 10-9
10.10 Termination of Employment............ 10-10
10.11 Environmental Cleanup................ 10-10
10.12 Trade Accounts Receivable Guarantee.. 10-10
10.13 Debit Memos.......................... 10-12
10.14 Notes Receivable..................... 10-12
10.15 Linen Business....................... 10-12
10.16 Power of Attorney.................... 10-14
10.17 Further Assurances................... 10-16
10.18 Directions to Escrow Agent........... 10-16


ARTICLE XI MISCELLANEOUS....................... 11-1


11.02 Notices.............................. 11-1
11.02 Assignability and Parties in
Interest............................ 11-1
11.03 Expenses............................. 11-2
11.04 Collections.......................... 11-2
11.05 Governing Law........................ 11-2
11.06 Counterparts......................... 11-2
11.07 Headings............................. 11-3
11.08 Pronouns, etc........................ 11-3
11.09 Complete Agreement................... 11-3
11.10 Modifications, Amendments
and Waivers......................... 11-3
11.11 Severability......................... 11-4
11.12 Consent to Option.................... 11-4


-iii-


APPENDICES


SECTION
DESCRIPTION REFERENCE
------------- --------- Appendix A Escrow Agreement 2.04(d) Appendix B Private Placement Questionnaire 2.07(b) Appendix C Covenant Not to Compete 4.14 Appendix D Employment Agreement 4.15 Appendix E Option to Buy Greenville, N.C.
Property from Certain
Stockholders 4.18(c) Appendix F Opinion of Corporation's Counsel 8.06 Appendix G Opinion of Parent's Counsel 9.05


-iv-


AGREEMENT


AND


PLAN OF REORGANIZATION


THIS AGREEMENT AND PLAN OF REORGANIZATION ("Agreement") has been made and


entered into as of this 30th day of March, 1994, among BERGEN BRUNSWIG


CORPORATION, a New Jersey corporation ("Parent"), its wholly owned subsidiary


DMC ACQUISITION CORP., a North Carolina Corporation ("Subsidiary"), SOUTHEASTERN


HOSPITAL SUPPLY CORPORATION, a North Carolina corporation ("Corporation"), and


ELEANOR B. MANNING, RAY MANNING, JR., BETTY ROUSE, THE O.R. MANNING TRUST AND


CAROL SHORT ("Stockholders"),


R E C I T A L S:


1. The Parent desires that Subsidiary acquire substantially all of the


business, assets, and property of the Corporation, subject to certain of its


liabilities, in exchange solely for the Parent's Class A Common Stock, $1.50 par


value (the "Stock"), all on the terms and conditions hereinafter set forth,


NOW, THEREFORE, in consideration of the mutual covenants herein contained,


the parties adopt this Agreement as and for a Plan of Reorganization ("Plan")


under Section 368(a)(1)(C) of the Internal Revenue Code of 1986, as amended (the


"Code"), and in order to implement such Plan, the parties represent, warrant,


covenant, and agree as follows:


ARTICLE I


DEFINITIONS


The terms defined in this Article (except as otherwise expressly provided


in this Agreement) for all purposes of this Agreement shall have the respective


meanings specified in this Article.


1.01 Affiliate shall mean any entity controlling or controlled by the


Corporation or controlled by any entity which controls the Corporation.


1.02 Agreement shall mean this Agreement, the Supplemental Agreement and


all the exhibits and other documents attached to or referred to in either of


them, and all amendments and supplements, if any, to either of them.


1.03 Closing shall mean the meeting of the parties at which all Closing


Documents shall be exchanged by the parties, except for those documents, or


other items specifically required to be exchanged at a later time.


1.04 Closing Date shall mean April 29, 1994, or such other date as agreed


to by the parties on which the Closing, occurs.


1.05 Closing Documents shall mean the papers, instruments and documents


required to be executed and delivered at the Closing pursuant to this Agreement.


1-1


1.06 CPA shall mean Deloitte & Touche.


1.07 Debit Memos shall mean memoranda issued by the corporation to its


vendors asserting its claim to a credit from such vendors with respect to


merchandise returned to the vendor, promotional allowances earned, chargebacks,


or rebates, whether such items are classified by the Corporation as receivables


from vendors or reductions of payables to vendors.


1.08 ERISA shall mean Employee Retirement Income Security Act.


1.09 Escrow Agent shall mean Wachovia Bank of North Carolina, N.A.


1.10 GAAP shall mean generally accepted accounting principles applied by


the Corporation in a manner consistent with prior periods.


1.11 Reserved.


1.12 Knowledge. Any limitation or qualification of a representation or


warranty made by the Corporation or the Stockholders in this Agreement or in the


Supplemental Agreement which is based on "knowledge" shall include facts known


to any of the Stockholders.


1.13 Market Value shall mean the average of the last sale prices of the


Stock on the New York Stock Exchange during the 30 trading days ending 10 days


prior to the Closing Date, but such Market Value shall be not greater than


$19-3/8 nor less than $16-3/8.


1-2


1.14 Net Asset Value shall mean the Corporation's assets to be transferred


to Subsidiary pursuant to Section 2.01, as valued pursuant to Section 5.02, less


the Corporation's liabilities to be assumed by Subsidiary pursuant to Section


2.03, as valued pursuant to Section 5.03.


1.15 Notes Receivable shall mean the promissory notes which the Corporation


has received from its customers in connection either with the sale of opening


orders or to evidence past due open accounts.


1.16 Parent Representative shall mean any one of the following persons:


Robert E. Martini, Dwight A. Steffensen, Neil F. Dimick or Milan A. Sawdei.


1.17 Premises shall mean all locations at which the Corporation or its


Subsidiaries do business and, which are listed in Exhibit 2.7.1 to the


Supplemental Agreement.


1.18 Regulated Substances shall have the meaning ascribed to that term in


section 2.24 of the Supplemental Agreement.


1.19 Representative shall mean any of the following persons: Ray Manning,


Jr. or Sammy Short if Ray Manning, Jr. should be unable to act on any matter or


matters.


1.20 SEC shall mean the Securities and Exchange Commission.


1-3


1.21 Supplemental Agreement shall mean an agreement executed concurrently


with this Agreement by the parties to this Agreement containing a series of


representations and warranties.


1.22 Trade Accounts Receivable shall mean all accounts receivable arising


from the sale or lease of goods or services to customers in the ordinary course


of the Corporation's business and to manufacturers for goods delivered to


manufacturers' salesmen.


1.23 Transaction shall mean the transaction contemplated by this Agreement.


1.24 Terms Defined in Other Sections. The following terms are defined


elsewhere in this Agreement in the following Sections:


Act 2.07(a)


Code Recital 2


Corporation Heading


Escrow Agreement 2.04(d)


Estimated Net Asset Value 2.04(b)


Final Accountant's Report 5.01(b)


HSR Act 4.09


Initial Accountant's Report 5.01(a)


Inventory 2.01(b)


Linen Business 10.15


Linen Cost 10.15


Linen Loss 10.15


1-4
Linen Receivables 10.15


Loss or Losses 10.02


Obsolete Inventory 5.02(a)


Outside Date 6.01


Parent Heading


Permitted Encumbrances 8.08


Plan Recital 2


Preliminary Balance Sheet 2.04(b)


Proposed Statement 5.01(a)


Reassigned Receivables 10.12


Registration Statement 2.07(c)


Saleable Inventory 5.02(a)


Stockholders Heading


Stock Recital 1


Subsidiary Heading


1-5


ARTICLE II


ACQUISITION PROVISIONS


2.01 Transfer and Assignment of Assets. On the Closing Date, subject to


the terms and conditions set forth in the Agreement, the Corporation shall


convey, transfer, assign and deliver to Subsidiary all the Corporation's assets,


properties, and business of every kind, character, and description, whether


tangible or intangible, whether real, personal, or mixed, and wherever located


on the Closing Date (except for those excluded by Section 2.02 hereof), and


Subsidiary shall accept those assets, including, but not limited to, the


following:


(a) cash. All cash in Corporation's banks or in its possession.


(b) inventory. All inventory located at or in route to the Premises which


shall be referred to herein as the "Inventory". The Corporation shall use its


best efforts prior to Closing to induce its customers to return promptly any


merchandise purchased from the Corporation which those customers intend to


return for credit.


(c) receivables. All Trade Accounts Receivable and Notes Receivable owned


by the Corporation.


(d) real estate. All real estate leases described on Exhibit 2.7 to the


Supplemental Agreement.


2-1


(e) tangibles. All tangible personal property owned by the Corporation.


(f) equipment leases. Rights of the Corporation under all equipment leases described in Exhibit 2.8 to the Supplemental Agreement.


(g) intangibles. All intangible personal property owned or used by the


Corporation, including but not limited to all distribution, franchise, license


agreements, trademarks, tradenames and other intangible assets listed on Exhibit


2.10.1 to the Supplemental Agreement, all computer programs listed on Exhibit


2.10.2 to the Supplemental Agreement, and all material contracts listed in


Exhibit 2.14.1 to the Supplemental Agreement.


(h) books and records. All books, papers, records and files pertaining in


any way to the business of the Corporation, including without limitation, sales


correspondence, customer lists, credit and sales records, purchasing records,


data processing records, and all documents and records pertaining to the


properties and assets to be transferred hereunder.


(i) purchase orders. All outstanding purchase orders received in the


ordinary course of business from the Corporation's customers.


(j) proposals. All outstanding proposals, quotations, or bids to


customers and all contracts entered into with customers in the ordinary course


of business.


2-2


(k) telephone numbers. The Corporation's telephone numbers.


(1) claims. All claims for money due and owing, claims and rights to tax


loss carryforwards, rights, if any, under any condemnation proceedings, and all


other claims and rights of every kind existing and owned by the Corporation on


the Closing Date.


2.02 Assets Not Being Acquired. Excluded from the assets to be conveyed,


transferred, assigned by the Corporation and accepted by Subsidiary under


Section 2.01 are:


(a) cash for taxes. Cash in the amount sufficient to pay any federal,


state or local income, franchise, sales or other taxes or business license fees


measured by the business done by the Corporation through the Closing Date. The


cash retained by the Corporation pursuant to this section shall be used by the


Corporation to pay those taxes. The Corporation hereby agrees to pay the same


and to hold Subsidiary free and harmless from any claim with respect to those


taxes. In the event that the cash retained pursuant to this section would


exceed the amount required to discharge those taxes, the Corporation shall


promptly remit the excess cash to Subsidiary.


(b) certain assets of linen business. All raw materials and


work-in-progress of the Corporation's Linen Business.


2-3


(c) home care business. All assets, consisting principally of accounts


receivable, inventory and equipment, of the Corporation's Home Care business.


(d) corporate records. All of the Corporation's stock transfer records


and all other records of the Corporation relating solely to its corporate


organization and structure, accounting books of original entry or original


supporting vouchers or general ledgers or any records which the Corporation is


required by law or government regulations to keep in its possession.


(e) malpractice claim. The pending malpractice claim which the


Corporation has asserted against its former law firm.


2.03 Assumption And Payment Of Specific Liabilities.


(a) debts assumed. As part consideration for the assignment, conveyance,


and transfer of substantially all of the assets, properties, and business of the


Corporation contemplated hereby, Subsidiary shall, subject to the limitations


contained herein, assume and discharge only the debts, liabilities, and


obligations of the Corporation hereinafter specified in this Section 2.03(a),


and no others:


(i) Debts, liabilities and obligations of the Corporation which are


expressly set forth as liabilities on the Corporation's most recent balance


sheet annexed to the Supplemental Agreement as Exhibit 2.25, in the amounts and


2-4


only in the amounts of such debts, liabilities, and obligations stated in such


balance sheet; provided, however, that Subsidiary shall not assume and discharge


any debts, liabilities, and obligations set forth on such balance sheet which


have been discharged prior to Closing.


(ii) Debts, liabilities and obligations of the Corporation which arise in


the ordinary course and conduct of business by the Corporation subsequent to the


date of said balance sheet and prior to Closing, including liability for payment


for merchandise ordered by the Corporation and not yet received (if such


merchandise shall have been ordered in the ordinary course of the Corporation's


business) but excluding tax liability for taxes arising out of the business done


by the Corporation subsequent to June 30, 1993.


(iii) Debts, liabilities, and obligations of the Corporation which arise


after the Closing with respect to purchase orders to suppliers and from


customers entered into in the ordinary course of the Corporation's business and


contracts listed on Exhibit 2.14.1 to the Supplemental Agreement, providing


there has been no breach of warranty by the Corporation with respect thereto.


(iv) Indebtedness to United Carolina Bank in the amount of $500,000


incurred by the Corporation during February, 1994 to make leasehold improvements


in the Premises located at Greenville, North Carolina.


2-5


(b) limitation. Except for the debts, liabilities, and obligations of the


Corporation which Subsidiary has hereinabove expressly agreed to assume or


discharge, neither Parent nor Subsidiary shall be responsible for and neither of


them is assuming or agreeing to discharge any debts, liabilities, or obligations


of the Corporation or the Stockholders, whether accrued now or hereafter and


whether known, unknown, contingent, or otherwise.


2.04 Consideration.


(a) shares of stock at closing. In part consideration for the assignment,


conveyance and transfer by the Corporation contemplated by this Agreement,


Parent shall issue shares of Stock on the Closing Date having a Market Value (as


defined) equal to Estimated Net Asset Value plus $5,000,000, subject to later


adjustment as provided herein. The maximum number of shares of Stock to be


issued by the Parent pursuant to this Agreement shall be 870,000, subject to


adjustment pursuant to Section 2.06.


(b) estimated net asset value. Estimated Net Asset Value shall be the Net


Asset Value of the Corporation as of the end of the month immediately preceding


the Closing Date, and shall be based upon unaudited statements prepared by the


Corporation in accordance with GAAP as reflected on the most recent balance


sheet of the Corporation which is annexed as Exhibit 2.
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