UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 OR 15(d) of The Securities
Exchange Act of 1934
Date of Report (Date of earliest event reported):
January 17, 2024 (January 16, 2024)
![](https://www.sec.gov/Archives/edgar/data/1354327/000095010324000743/image_001.jpg)
PGT Innovations, Inc.
(Exact name of registrant
as specified in its charter)
Delaware |
001-37971 |
20-0634715 |
(State or
other jurisdiction
of incorporation) |
(Commission
File Number) |
(IRS Employer
Identification
No.) |
|
|
|
1070
Technology Drive, North Venice, FL |
|
34275 |
(Address
of principal executive offices) |
|
(Zip Code) |
(941) 480-1600
(Registrant’s
telephone number, including area code)
Not Applicable
(Former name or
former address, if changed since last report)
Check the appropriate box below if the
Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
| ☐ | Written
communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) |
| ☒ | Soliciting
material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) |
| ☐ | Pre-commencement
communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) |
| ☐ | Pre-commencement
communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) |
Securities
registered pursuant to Section 12(b) of the Act:
Title
of each class |
|
Trading
Symbol(s) |
|
Name
of each exchange on which
registered |
Common
Stock, par value $0.01 per share |
|
PGTI |
|
The New
York Stock Exchange, Inc. |
Indicate by check mark whether the registrant
is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the
Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
Emerging growth company ☐
If an emerging growth company, indicate
by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial
accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐
| Item 1.01 | Entry
into a Material Definitive Agreement. |
MIWD Agreement
and Plan of Merger
Overview
On January 16,
2024, PGT Innovations, Inc., a Delaware corporation (“PGTI”), entered into an Agreement and Plan of Merger (the “Merger
Agreement”) with MIWD Holding Company LLC, a Delaware limited liability company (“MIWD”), and RMR MergeCo,
Inc., a Delaware corporation and an indirect wholly-owned subsidiary of MIWD (“Merger Sub”). Upon the terms and subject
to the conditions set forth in the Merger Agreement, Merger Sub will merge with and into PGTI (the “Merger”), with
PGTI surviving as a wholly owned indirect subsidiary of MIWD.
Merger Consideration
Pursuant to the
Merger Agreement, at the effective time of the Merger (the “Effective Time”), each issued and outstanding share of
PGTI’s common stock, par value $0.01 per share (each, a “PGTI Common Share”) (other than any PGTI Common Shares
that are held by PGTI as treasury stock or held by MIWD, Merger Sub or any other subsidiary of MIWD or PGTI or any PGTI Common Shares
as to which appraisal rights have been properly exercised in accordance with Delaware law), will automatically be canceled and retired
and converted into the right to receive $42.00 per share in cash, without interest (the “Merger Consideration”).
Financing of
the Transaction
MIWD intends to
fund the Merger Consideration with proceeds from new debt and equity financing together with cash on hand. Concurrently with the entry
into the Merger Agreement, MIWD entered into (i) a debt commitment letter (the “Debt Commitment
Letter”), pursuant to which certain financial institutions (the “Lenders”)
have committed to provide to MIWD up to (a) $1,800,000,000 aggregate principal amount under a senior secured term loan facility and (b)
$325,000,000 aggregate principal amount under a senior secured asset-based revolving credit facility and (ii) an equity commitment letter
(the “Equity Commitment Letter” and, together with the Debt Commitment Letter,
the “Commitment Letters”), pursuant to which Koch Equity Development LLC
(“Koch”) has committed to purchase up to $979,000,000 of equity interests
in MIWD. The obligations of the Lenders to provide debt financing under the Debt Commitment Letter and Koch to provide equity financing
under the Equity Commitment Letter are subject to certain customary conditions, including (a) the execution and delivery of definitive
documentation with respect to such financing in accordance with such Commitment Letter and (b) the consummation of the Merger in all
material respects in accordance with the terms and conditions of the Merger Agreement. The receipt of financing by MIWD is not a condition
to MIWD’s obligation to complete the Merger.
Treatment of
PGTI Equity Awards
Effective as of immediately prior to
the Effective Time, the restrictions on each restricted share of PGTI Common Share that is subject to vesting or forfeiture granted under
the Amended and Restated Company 2019 Equity and Incentive Compensation Plan (the “PGTI Stock Plan” and each such
restricted share, a “PGTI Restricted Share”) prior to the date of the Merger Agreement and then outstanding will lapse,
and each such PGTI Restricted Share will be treated at the Effective Time the same as, and have the same rights and be subject to the
same conditions as, an outstanding share of PGTI Common Share not subject to any restrictions, subject to any withholding taxes required
by applicable law to be withheld; provided that, if there are any performance conditions applicable to any PGTI Restricted Share, then
the restrictions on such performance-based PGTI Restricted Share will lapse with respect to a number of PGTI Common Shares that is calculated
pursuant to certain assumptions and otherwise in accordance with the PGTI Stock Plan and the applicable award agreement governing such
performance-based PGTI Restricted Shares. Effective as of immediately prior to the Effective Time, each PGTI Restricted Share granted
after the date of the Merger Agreement and then outstanding will be converted into an award that entitles the holder thereof,
upon vesting, to receive an amount
in cash equal to the Merger Consideration, plus any interest accrued on the basis of the prime rate as published in The Wall Street
Journal in effect at the Effective Time, compounded quarterly, calculated on the basis of actual days elapsed (including the closing
date of the Merger and each applicable vesting date) in respect of each such PGTI Restricted Share; provided that, in the event that
the holder’s service is terminated by PGTI or the surviving corporation in the Merger without Cause or by the holder for Good
Reason (each as defined in the Amended and Restated PGT Innovations, Inc. 2019 Equity and Incentive Compensation Plan, as most
recently amended and/or restated) at the time of or within twenty-four (24) months following the Effective Time, any such PGTI
Restricted Share that is unvested as of the date of such holder’s separation from service shall fully vest.
Each restricted stock unit that is subject
to vesting conditions based solely on continued employment or service granted under the PGTI Stock Plan (each, a “PGTI RSU”)
and that is outstanding immediately prior to the Effective Time will be cancelled and converted into the right to receive an amount equal
to: (i) the Merger Consideration plus (ii) any accrued but unpaid dividends or dividend equivalents in respect of such PGTI RSU
as of the Effective Time.
Board Approval of the Merger Agreement
The board
of directors of PGTI (the “PGTI Board”) unanimously adopted and approved the Merger Agreement and the transactions
contemplated thereby, including the Merger and, subject to the terms and conditions of the Merger Agreement, resolved to recommend that
PGTI’s stockholders adopt the Merger Agreement.
Closing
Conditions
The obligation
of the parties to consummate the Merger is subject to the satisfaction or waiver of certain customary closing conditions, including (i)
the affirmative vote by holders of a majority of the outstanding PGTI Common Shares entitled to vote at the company stockholders meeting
(the “PGTI Stockholders Meeting”), to adopt the Merger Agreement (the “PGTI Stockholder Approval”);
(ii) the expiration or early termination of the waiting period under the Hart-Scott-Rodino Antitrust Improvements Act of 1976 (as amended)
(the “HSR Act”); (iii) the absence of any law, injunction, order or other
judgment prohibiting, rendering illegal or permanently enjoining the consummation of the Merger (a “Restraint”); (iv)
subject in most cases to exceptions that do not rise to the level of a Company Material Adverse
Effect or a Parent Material Adverse Effect (each as defined in the Merger Agreement), as applicable, the accuracy of representations
and warranties made by PGTI and MIWD, respectively; and (vii) compliance by MIWD and PGTI
in all material respects with their respective obligations. The respective obligations of MIWD and PGTI to consummate the Merger are
also subject to there not having occurred since the date of the Merger Agreement an event that has had or would reasonably be expected
to have, individually or in the aggregate, a Company Material Adverse Effect.
Representations
and Warranties and Covenants
MIWD,
PGTI and Merger Sub have each made customary representations and warranties and covenants in the Merger Agreement, including covenants
by PGTI, subject to certain exceptions, to use reasonable best efforts to conduct its business in the ordinary course and preserve intact
in all material respects its current business operations, during the interim period between the execution of the Merger Agreement and
the consummation of the Merger (the “Interim Period”) and to assist MIWD with obtaining its financing to fund the
Merger Consideration. The Merger Agreement also contains customary covenants, including covenants by MIWD, subject to certain exceptions,
not to take certain actions during the Interim Period without the prior written consent of the other party (not to be unreasonably withheld,
conditioned or delayed).
MIWD
and PGTI have each agreed to use its respective reasonable best efforts to cause the transactions contemplated by the Merger Agreement
to be consummated as soon as reasonably practicable, including in connection with obtaining all consents required to be obtained from
any governmental authority or third party that are necessary, proper or advisable to consummate the Merger. MIWD has also agreed to take
actions
that
are reasonably necessary to avoid, eliminate or resolve any impediments under the HSR Act so
as to enable the parties to consummate the Merger no later than the End Date (as defined below); provided that MIWD will not be obligated
to take any such action to the extent it would be material measured relative to the size of PGTI and its subsidiaries.
Non-Solicitation;
Intervening Events
Subject to certain
exceptions, PGTI agreed not to solicit alternative acquisition proposals, engage in discussions with any third party regarding alternative
acquisition proposals or change its recommendation to its stockholders in favor of the Merger.
The Merger
Agreement also provides that, notwithstanding the foregoing, if prior to receipt of the PGTI Stockholder Approval, PGTI receives a
bona fide alternative acquisition proposal from a third party that did not result from a material breach of PGTI’s
non-solicitation obligations, and the PGTI Board determines in good faith that the alternative acquisition proposal constitutes, or
would reasonably be expected to result in, a Superior Proposal (as defined in the Merger Agreement), PGTI may provide information
to, and engage in negotiations and discussions with, such person making the alternative acquisition proposal.
Prior to
obtaining the PGTI Stockholder Approval, the PGTI Board has the right, in connection with (i) the receipt of a Superior Proposal or
(ii) an Intervening Event (as defined in the Merger Agreement) to change its recommendation in favor of the Merger or, in the case
of a Superior Proposal, to terminate the Merger Agreement, in each case, subject to complying with notice requirements and other
specified conditions (including giving MIWD the opportunity to propose changes to the
Merger Agreement in response to such Superior Proposal or Intervening Event, as applicable), if the PGTI Board determines in good
faith that the failure to take such action would be inconsistent with its fiduciary duties under applicable law, and provided that,
in the case of a termination of the Merger Agreement, PGTI pays to MIWD the PGTI
Termination Fee (as described below).
Termination
The
Merger Agreement contains certain customary termination rights for each of MIWD
and PGTI, including, (i) by mutual written agreement, (ii) if the Merger has not been consummated on or before July 16, 2025,
subject to extension if necessary to allow the completion of a customary marketing period in respect
of MIWD’s financing (the “End Date”), (iii) any applicable Restraint
permanently enjoining the consummation of the Merger has become final and nonappealable,
(iv) the PGTI Stockholder Approval shall not have been obtained at the PGTI Stockholders Meeting or (v) the other party is in breach
of the Merger Agreement in a manner that would result in a failure of an applicable closing condition and such breach cannot be cured
or, if curable, has not been cured within 20 business days after notice to the other party of such breach (or, if earlier, five business
days prior to the End Date).
In addition, prior
to receipt of the PGTI Stockholder Approval, PGTI may also terminate the Merger Agreement to (i) accept a Superior Proposal, subject
to MIWD’s right to match such Superior Proposal and payment to MIWD
of the PGTI Termination Fee (as described below), or (ii) in circumstances relating to MIWD’s
breach of the Merger Agreement or failure to consummate the Merger when it is required to
do so under the Merger Agreement, subject to payment to PGTI of the MIWD Termination
Fee or the MIWD Regulatory Termination Fee, as applicable (as described below). MIWD may
terminate the Merger Agreement if PGTI Board changes its recommendation to PGTI’s stockholders regarding the Merger Agreement (an
“Adverse Recommendation Change”).
Termination
Fees
The
Merger Agreement provides for the payment of termination fees upon termination of the Merger Agreement under certain specified circumstances.
PGTI will be obligated to pay MIWD a termination fee
of $86,000,000 (the “PGTI Termination Fee”) if the Merger Agreement is terminated (i) by PGTI to accept a Superior
Proposal, (ii) by MIWD following an Adverse Recommendation Change, or (iii) in certain circumstances
by either MIWD or PGTI upon failure to obtain PGTI Stockholder Approval if (a) at the time
of such termination, an alternative acquisition proposal has been made and not withdrawn at least two
business days prior
to such termination and (b) within 12 months following such termination, PGTI enters into an agreement with respect to an alternative
acquisition proposal or an alternative acquisition proposal is consummated.
MIWD
will be obligated to pay PGTI a termination fee of $184,000,000 (the “MIWD
Termination Fee”) if the Merger Agreement is terminated by PGTI in certain circumstances relating
to MIWD’s breach of the Merger Agreement or failure to consummate the Merger when
it is required to do so under the Merger Agreement. In addition, MIWD will be obligated to pay PGTI a termination fee of $221,000,000
(the “MIWD Regulatory Termination Fee”) in certain circumstances where regulatory approval for the Merger is not obtained.
If the Merger Agreement is terminated in circumstances where both the MIWD Termination Fee and the MIWD Regulatory Termination Fee would
be payable, then only the MIWD Regulatory Termination Fee will be payable.
PGTI Charter Amendment
At the PGTI Stockholders
Meeting, PGTI expects to submit for the approval or adoption by PGTI’s stockholders an amendment to the Amended and Restated Certificate
of Incorporation of PGTI (as amended from time to time) designating PGTI as the agent of stockholders of PGTI to pursue damages in the
event that specific performance is not sought or granted as a remedy for MIWD’s fraud or material and willful breach of the Merger
Agreement (the “PGTI Organizational Document Amendment”). The PGTI Organizational Document Amendment is intended to
address recent caselaw from the Delaware Chancery Court that, could be construed to, in effect, limit the remedies available to PGTI
under the Merger Agreement absent the PGTI Organizational Document Amendment.
The
foregoing description of the Merger Agreement is not complete and is qualified in its entirety by, reference to the Merger Agreement,
a copy of which is attached to this Current Report on Form 8-K as Exhibit 2.1, and is incorporated herein by reference.
A
copy of the Merger Agreement has been included to provide investors and securityholders with information regarding its terms. It is not
intended to provide any other factual information about MIWD, PGTI and Merger Sub, or any of their respective subsidiaries or affiliates.
The representations, warranties and covenants contained in the Merger Agreement were made by the parties thereto only for purposes of
the Merger Agreement and as of specific dates; were made solely for the benefit of the parties to the Merger Agreement; may be subject
to limitations agreed upon by the contracting parties, including being qualified by confidential disclosures exchanged between the parties
in connection with the execution of the Merger Agreement (such disclosures include information that has been included in PGTI’s
public disclosures, as well as additional non-public information); may have been made for the purposes of allocating contractual risk
between the parties to the Merger Agreement instead of establishing these matters as facts; and may be subject to standards of materiality
applicable to the contracting parties that differ from those applicable to investors. Investors are not third-party beneficiaries under
the Merger Agreement and should not rely on the representations, warranties and covenants or any descriptions thereof as characterizations
of the actual state of facts or condition of the parties thereto or any of their respective subsidiaries or affiliates. Moreover, information
concerning the subject matter of representations and warranties may change after the date of the Merger Agreement, which subsequent information
may or may not be fully reflected in PGTI’s public disclosures.
| Item 1.02 | Termination
of a Material Definitive Agreement. |
Masonite Agreement
and Plan of Merger
As previously disclosed, on December 17, 2023, PGTI entered into an
Agreement and Plan of Merger (the “Masonite Merger Agreement”) with Masonite
International Corporation, a British Columbia corporation (“Masonite”), and
Peach Acquisition, Inc., a Delaware corporation and an indirectly wholly owned
subsidiary of Masonite (“Merger
Sub”), pursuant to which, upon the terms and subject to the conditions set forth therein, Merger Sub would merge with and
into PGTI, with PGTI surviving as an indirectly wholly-owned subsidiary of Masonite.
On January 15, 2024, PGTI delivered to Masonite a notice of receipt
of a Superior Proposal (as defined in the Masonite Merger Agreement) in accordance with Section 6.04(d) of the Masonite Merger Agreement.
On January 16, 2024, Masonite agreed to waive the four business day match period provided under the Masonite Merger Agreement. Accordingly,
on January 16, 2024, PGTI terminated the Merger Agreement pursuant to Section 10.01(d)(i) thereof, and, consistent with the terms of the
Masonite Merger Agreement, directed MIWD to pay the Company Termination Fee (as defined in the Masonite Merger Agreement) of $84.0 million
in cash.
The full text of the Masonite Merger Agreement was filed as Exhibit
2.1 to the Current Report on Form 8-K that was filed with the Securities and Exchange Commission by PGTI on December 18, 2023.
| Item 7.01 | Regulation FD Disclosure.
|
On January 17,
2024, PGTI and MIWD issued a joint press release announcing the entry into the Merger Agreement. In connection with the announcement
of the Transaction, PGTI posted the joint press release to its website. The press release is attached to this Current Report on Form
8-K as Exhibit 99.1 and is incorporated herein by reference.
The information
in this Item 7.01, including Exhibit 99.1, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange
Act of 1934, as amended (the “1934 Act”), nor shall they be deemed incorporated by reference in any filing under the
Securities Act of 1933, as amended (the “1933 Act”), or the 1934 Act.
| Item 9.01 | Financial Statements and Exhibits |
(d) Exhibits
Cautionary Statement Regarding Forward-Looking
Statements
This communication
contains “forward-looking statements” within the United States Private Securities Litigation Reform Act of 1995. You can
identify these statements and other forward-looking statements in this document by words such as “may,” “will,”
“should,” “can,” “could,” “anticipate,”
“estimate,” “expect,” “predict,” “project,” “future,” “potential,”
“intend,” “plan,” “assume,” “believe,” “forecast,” “look,” “build,”
“focus,” “create,” “work,” “continue,” “target,”
“poised,” “advance,” “drive,” “aim,” “forecast,” “approach,”
“seek,” “schedule,” “position,” “pursue,” “progress,” “budget,”
“outlook,” “trend,” “guidance,” “commit,” “on track,” “objective,”
“goal,” “strategy,” “opportunity,” “ambitions,” “aspire” and similar expressions,
and variations or negative of such terms or other variations thereof. Words and terms of similar substance used in connection
with any discussion of future plans, actions, or events identify forward-looking statements.
Forward-looking statements by their nature address
matters that are, to different degrees, uncertain, such statements regarding the transactions contemplated by the Merger Agreement (including
the Merger) (the “Transaction”), including the expected time period to consummate
the Transaction. All such forward-looking statements are based upon current plans, estimates, expectations and ambitions that are subject
to risks, uncertainties and assumptions, many of which are beyond the control of PGTI, that could cause actual results to differ materially
from those expressed in such forward-looking statements. Key factors that could cause actual results to differ materially include, but
are not limited to, the expected timing and likelihood of completion of the Transaction, including the timing, receipt and terms and
conditions of any required governmental and regulatory approvals of the Transaction; the
occurrence of any event, change or other circumstances that
could give rise to the termination of the definitive agreement; the possibility that PGTI’s stockholders may not approve the Transaction;
the risk that the parties may not be able to satisfy the conditions to the Transaction in a timely manner or at all; risks related to
disruption of management time from ongoing business operations due to the Transaction; the risk that any announcements relating to the
Transaction could have adverse effects on the market price of PGTI’s common stock; the risk that the Transaction and its announcement
could have an adverse effect on the parties’ business relationships and business generally, including the ability of PGTI to retain
customers and retain and hire key personnel and maintain relationships with their suppliers and customers, and on their operating results
and businesses generally; the risk of unforeseen or unknown liabilities; customer, shareholder, regulatory and other stakeholder approvals
and support; the risk of potential litigation relating to the Transaction that could be instituted against PGTI or its directors and/or
officers; the risk associated with third party contracts containing material consent, anti-assignment, transfer or other provisions that
may be related to the Transaction which are not waived or otherwise satisfactorily resolved; the risk of rating agency actions and PGTI’s
ability to access short- and long-term debt markets on a timely and affordable basis; the risk of various events that could disrupt operations,
including severe weather, such as droughts, floods, avalanches and earthquakes, cybersecurity attacks, security threats and governmental
response to them, and technological changes; the risks of labor disputes, changes in labor costs and labor difficulties; and the risks
resulting from other effects of industry, market, economic, legal or legislative, political or regulatory conditions outside of PGTI’s
control. All such factors are difficult to predict and are beyond our control, including those detailed in PGTI’s annual reports
on Form 10-K, quarterly reports on Form 10-Q and Current Reports on Form 8-K that are available on PGTI’s website at https://pgtinnovations.com
and on the website of the Securities Exchange Commission (“SEC”) at http://www.sec.gov.
PGTI’s forward-looking statements are based on assumptions that PGTI’s believes to be reasonable but that may not prove to
be accurate. Other unpredictable or factors not discussed in this communication could also have material adverse effects on forward-looking
statements. PGTI does not assume an obligation to update any forward-looking statements, except as required by applicable law. These forward-looking
statements speak only as of the date hereof.
Additional
Information and Where to Find It
In
connection with the Transaction, PGTI will file with the SEC a proxy statement on Schedule 14A. The definitive proxy statement will be
sent to the stockholders of PGTI seeking their approval of the Transaction and other related matters.
INVESTORS
AND SECURITY HOLDERS ARE URGED TO READ THE PROXY STATEMENT ON SCHEDULE 14A WHEN IT BECOMES AVAILABLE, AS WELL AS ANY OTHER RELEVANT DOCUMENTS
FILED WITH THE SEC IN CONNECTION WITH THE TRANSACTION OR INCORPORATED BY REFERENCE INTO THE PROXY STATEMENT, BECAUSE THEY WILL CONTAIN
IMPORTANT INFORMATION REGARDING PGTI, THE TRANSACTION AND RELATED MATTERS.
Investors and security
holders may obtain free copies of these documents, including the proxy statement, and other documents filed with the SEC by PGTI through
the website maintained by the SEC at http://www.sec.gov. Copies of documents filed with the SEC by PGTI will be made available free of
charge by accessing PGTI’s website at https://pgtinnovations.com or by contacting PGTI by submitting a message at https://ir.pgtinnovations.com/investor-contact
or by mail at 1070 Technology Drive, North Venice, FL 34275.
Participants
in the Solicitation
PGTI, its directors, executive officers and other
persons related to PGTI may be deemed to be participants in the solicitation of proxies from PGTI’s stockholders in connection
with the Merger. Information about the directors and executive officers of PGTI and their ownership of PGTI common stock is also set
forth in PGTI’s definitive proxy statement in connection with its 2023 Annual Meeting of Stockholders, as filed with the SEC on
April 10, 2023 (and which is available at https://www.sec.gov/Archives/edgar/data/1354327/000119312523126009/d442491ddef14a.htm), PGTI’s
Current Report on Form 8-K filed with the SEC on July 3, 2023 (and which is available at https://www.sec.gov/Archives/edgar/data/1354327/000095010323009816/dp196528_8k.htm),
PGTI’s Current Report on Form 8-K filed with the SEC on August 8, 2023 (and is available at https://www.sec.gov/Archives/edgar/data/1354327/000095010323011731/dp198129_8k.htm),
PGTI’s Current Report on Form 8-K filed with the SEC on November 6, 2023 (and is available at https://www.sec.gov/Archives/edgar/data/1354327/000095010323016034/dp202537_8k.htm),
and PGTI’s Current Report on Form 8-K filed with the SEC on January 2, 2024 (and is available at https://www.sec.gov/Archives/edgar/data/1354327/000095010324000038/dp204648_8k.htm).
Information about the directors and executive officers of PGTI, their ownership of PGTI common stock, and PGTI’s transactions with
related persons is set forth in the sections entitled “Directors, Executive Officers and Corporate Governance,” “Security
Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters,” and “Certain Relationships and Related
Transactions, and Director Independence” included in PGTI’s annual report on Form 10-K for the fiscal year ended December
31, 2022, which was filed with the SEC on February 27, 2023 (and which is available at https://www.sec.gov/Archives/edgar/data/1354327/000095017023004543/pgti-20221231.htm),
and in the sections entitled “Board Highlights” and “Security Ownership of Certain Beneficial Owners and Management”
included in PGTI’s definitive proxy statement in connection with its 2023 Annual Meeting of Stockholders, as filed with the SEC
on April 28, 2023 (and which is available at https://www.sec.gov/Archives/edgar/data/1354327/000119312523126009/d442491ddef14a.htm).
Additional information regarding the participants in the proxy solicitation and a description of their direct and indirect interests,
by security holdings or otherwise, will be included in the proxy statement and other relevant materials to be filed with the SEC in connection
with the proposed transaction when they become available. Free copies of these documents may be obtained as described in the preceding
paragraph.
No Offer or Solicitation
This communication
is not intended to and shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer
to buy any securities or the solicitation of any vote of approval, nor shall there be any sale of securities in any jurisdiction in which
such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.
No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the 1933 Act.
* * *
SIGNATURES
Pursuant
to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by
the undersigned hereunto duly authorized.
|
PGT INNOVATIONS,
INC. |
|
|
|
|
|
By: |
/s/
Ryan S. Quinn |
|
Name: |
Ryan
S. Quinn |
|
Title: |
General
Counsel and Corporate Secretary |
|
|
|
|
|
|
Date:
January 17, 2024 |
|
|
Exhibit
2.1
EXECUTION
VERSION
AGREEMENT AND
PLAN OF MERGER
dated as of
January 16, 2024
among
PGT INNOVATIONS, INC.,
MIWD HOLDING COMPANY LLC
and
RMR MERGECO, INC.
TABLE OF CONTENTS
Page
ARTICLE
1 Definitions |
1 |
Section
1.01 Definitions |
1 |
Section
1.02 Other Definitional and Interpretative Provisions |
13 |
ARTICLE
2 The Merger |
15 |
Section
2.01 The Merger. |
15 |
Section
2.02 Conversion of Shares. |
16 |
Section
2.03 Surrender and Payment. |
16 |
Section
2.04 Dissenting Shares. |
18 |
Section
2.05 Treatment of Equity Awards. |
18 |
Section
2.06 Adjustments |
20 |
Section
2.07 Withholding Rights |
20 |
Section
2.08 Lost Certificates |
20 |
ARTICLE
3 The Surviving Corporation |
21 |
Section
3.01 Certificate of Incorporation |
21 |
Section
3.02 Bylaws |
21 |
Section
3.03 Directors and Officers |
21 |
ARTICLE
4 Representations And Warranties Of The Company |
21 |
Section
4.01 Corporate Existence and Power. |
21 |
Section
4.02 Corporate Authorization. |
22 |
Section
4.03 Governmental Authorization |
23 |
Section
4.04 Non-Contravention |
23 |
Section
4.05 Capitalization. |
23 |
Section
4.06 Subsidiaries. |
25 |
Section
4.07 SEC Filings; Internal Control. |
26 |
Section
4.08 Financial Statements |
27 |
Section
4.09 Disclosure Documents |
27 |
Section
4.10 Absence of Certain Changes |
28 |
Section
4.11 No Undisclosed Material Liabilities |
28 |
Section
4.12 Compliance with Laws; Permits. |
28 |
Section
4.13 Litigation |
29 |
Section
4.14 Properties. |
29 |
Section
4.15 Intellectual Property. |
30 |
Section
4.16 Taxes |
32 |
Section
4.17 Employee Benefit Plans. |
32 |
Section
4.18 Employee and Labor Matters. |
34 |
Section
4.19 Environmental Matters |
34 |
Section
4.20 Material Contracts. |
36 |
Section
4.21 Insurance |
38 |
Section
4.22 Products. |
38 |
Section
4.23 Finders’ Fees |
39 |
Section
4.24 Opinion of Financial Advisor |
39 |
Section
4.25 Antitakeover Statutes; Rights Agreement |
39 |
Section
4.26 Masonite Agreement |
39 |
Section
4.27 Acknowledgement of No Other Representations and Warranties |
39 |
ARTICLE
5 Representations And Warranties Of Parent And Merger Sub |
40 |
Section
5.01 Corporate Existence and Power |
40 |
Section
5.02 Corporate Authorization |
40 |
Section
5.03 Governmental Authorization |
40 |
Section
5.04 Non-Contravention |
41 |
Section
5.05 Disclosure Documents |
41 |
Section
5.06 Compliance with Laws |
41 |
Section
5.07 Litigation |
41 |
Section
5.08 Finders’ Fees |
41 |
Section
5.09 Financing. |
41 |
Section
5.10 Solvency |
43 |
Section
5.11 Ownership of Common Shares |
44 |
Section
5.12 Termination of Masonite Agreement |
44 |
Section
5.13 Acknowledgement of No Other Representations and Warranties |
44 |
ARTICLE
6 Covenants Of The Company |
44 |
Section
6.01 Conduct of the Company |
44 |
Section
6.02 Company Stockholders Meeting |
48 |
Section
6.03 Access to Information. |
49 |
Section
6.04 No-Shop; Other Offers. |
50 |
Section
6.05 Stock Exchange Delisting |
53 |
Section
6.06 Debt Financing Cooperation. |
53 |
ARTICLE
7 Covenants Of Parent |
57 |
Section
7.01 Conduct of Parent |
57 |
Section
7.02 Director and Officer Liability |
57 |
Section
7.03 Employee Matters. |
59 |
Section
7.04 Financing Covenants. |
61 |
ARTICLE
8 Covenants Of Parent And The Company |
63 |
Section
8.01 Regulatory Undertakings. |
63 |
Section
8.02 Certain Filings. |
66 |
Section
8.03 Public Announcements |
67 |
Section
8.04 Merger without Meeting of Stockholders |
68 |
Section
8.05 Further Assurances |
68 |
Section
8.06 Section 16 Matters |
68 |
Section
8.07 Notices of Certain Events |
69 |
Section
8.08 Litigation and Proceedings |
69 |
Section
8.09 Takeover Statutes; Rights Agreement |
69 |
Section
8.10 Masonite Termination Fee |
70 |
ARTICLE
9 Conditions To The Merger |
70 |
Section
9.01 Conditions to the Obligations of Each Party |
70 |
Section
9.02 Conditions to the Obligations of Parent and Merger Sub |
70 |
Section
9.03 Conditions to the Obligations of the Company |
71 |
ARTICLE
10 Termination |
72 |
Section
10.01 Termination |
72 |
Section
10.02 Effect of Termination |
73 |
ARTICLE
11 Miscellaneous |
74 |
Section
11.01 Notices |
74 |
Section
11.02 No Survival of Representations and Warranties |
75 |
Section
11.03 Amendments and Waivers. |
75 |
Section
11.04 Expenses. |
75 |
Section
11.05 Disclosure Schedule and SEC Document References |
78 |
Section
11.06 Binding Effect; Third Party Beneficiaries; Assignment. |
78 |
Section
11.07 Governing Law |
79 |
Section
11.08 Jurisdiction |
79 |
Section
11.09 WAIVER OF JURY TRIAL |
80 |
Section
11.10 Counterparts; Effectiveness |
80 |
Section
11.11 Entire Agreement |
80 |
Section
11.12 Severability |
80 |
Section
11.13 Specific Performance |
81 |
Section
11.14 Financing Sources |
81 |
| Exhibit A | Certificate of Incorporation of
Surviving Corporation |
| Exhibit B | Company Organizational Document
Amendment |
AGREEMENT AND
PLAN OF MERGER
AGREEMENT
AND PLAN OF MERGER (as amended in accordance with the terms and conditions hereof, this “Agreement”), dated as of
January 16, 2024, among PGT Innovations, Inc., a Delaware corporation (the “Company”), MIWD Holding Company LLC, a
Delaware limited liability company (“Parent”), and RMR MergeCo, Inc., a Delaware corporation and an indirect wholly
owned subsidiary of Parent (“Merger Sub”).
W I T N E S S E
T H :
WHEREAS,
the board of directors of the Company (the “Board of Directors”), and the board of managers of Parent and the board
of directors of Merger Sub, have approved and declared advisable this Agreement pursuant to which, among other things, Parent would acquire
the Company by means of a merger of Merger Sub with and into the Company, on the terms and subject to the conditions set forth in this
Agreement; and
WHEREAS,
prior to or substantially concurrently with the execution and delivery of this Agreement, (a) that certain Agreement and Plan of Merger,
dated as of December 17, 2023, by and among the Company, Masonite International Corporation (“Masonite”) and Peach
Acquisition, Inc. (the “Masonite Agreement”), has been validly terminated and (b) Parent has paid to the Company (or,
at the direction of the Company, to Masonite on behalf of the Company) the Company Termination Fee (as defined in the Masonite Agreement),
by wire transfer of immediately available funds in full satisfaction of all of the Company’s remaining obligations under the Masonite
Agreement and without any further liability of the Company thereunder.
NOW,
THEREFORE, in consideration of the foregoing and the representations, warranties, covenants and agreements contained herein, and for
other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto, intending to
be legally bound, agree as follows:
Article
1
Definitions
Section
1.01 Definitions. As
used herein, the following terms have the following meanings:
“1933
Act” means the Securities Act of 1933 and the rules and regulations promulgated thereunder.
“1934
Act” means the Securities Exchange Act of 1934 and the rules and regulations promulgated thereunder.
“Acceptable
Confidentiality Agreement” means a confidentiality agreement that (i) contains terms, with respect to confidentiality and use,
taken as a whole, that are not materially less restrictive to the Company’s counterparty thereto than those contained in the Confidentiality
Agreement (it being understood and agreed that such confidentiality agreement need not restrict any person from making, publicly or privately,
an Acquisition Proposal, acquiring the Company
or taking any other
similar action, or otherwise contain any standstill or similar provision), (ii) does not prohibit the Company from complying with Section
6.04 and (iii) does not include any provision calling for an exclusive right to negotiate with the Company prior to the valid termination
of this Agreement.
“Acquisition
Proposal” means, other than the transactions contemplated by this Agreement, any bona fide Third Party offer or proposal relating
to (i) any acquisition or purchase, direct or indirect, of twenty percent (20%) or more of the consolidated assets of the Company or
twenty percent (20%) or more of any class of equity or voting securities of the Company or any of its Subsidiaries whose assets, individually
or in the aggregate, constitute twenty percent (20%) or more of the consolidated assets of the Company, (ii) any tender offer (including
a self-tender offer) or exchange offer that, if consummated, would result in such Third Party beneficially owning twenty percent (20%)
or more of any class of equity or voting securities of the Company or any of its Subsidiaries whose assets, individually or in the aggregate,
constitute twenty percent (20%) or more of the consolidated assets of the Company or (iii) a merger, consolidation, share exchange, business
combination, sale of all or substantially all of the assets, reorganization, recapitalization, liquidation, dissolution or other similar
transaction involving the Company or any of its Subsidiaries whose assets, individually or in the aggregate, constitute twenty percent
(20%) or more of the consolidated assets of the Company.
“Adverse
Recommendation Change” has the meaning set forth in Section 6.04(a).
“Affiliate”
means, with respect to any Person, any other Person directly or indirectly controlling, controlled by or under common control with such
Person; provided that, for purposes of this Agreement, Parent and Merger Sub shall be deemed not to be Affiliates of the Company and
vice versa.
“Agreement”
has the meaning set forth in the Preamble.
“Alternative
Financing” has the meaning set forth in Section 7.04(d).
“Alternative
Financing Commitment Letter” has the meaning set forth in Section 7.04(d).
“Anti-Corruption
Law” means the U.S. Foreign Corrupt Practices Act of 1977, as amended, or any other Applicable Law related to bribery or corruption.
“Antitrust
Division” has the meaning set forth in Section 8.01(b).
“Applicable
Law” means, with respect to any Person, any domestic or foreign federal, state, provincial or local law, constitution, treaty,
act, statute, code, rule, regulation, order, injunction, judgment, decree, writ, award, ruling or other similar requirement enacted,
adopted, promulgated or applied by a Governmental Authority in any relevant jurisdiction that is binding upon or applicable to such Person.
“Balance
Sheet Date” has the meaning set forth in Section 4.10.
“Board
of Directors” has the meaning set forth in the Recitals.
“Business
Day” means a day, other than Saturday, Sunday or other day on which commercial banks in New York, New York are authorized or
required by Applicable Law to close.
“Cap”
has the meaning set forth in Section 7.02(d).
“CARES
Act” means the Coronavirus Aid, Relief, and Economic Security Act (Pub. L. 116-136).
“CBA”
has the meaning set forth in Section 4.18(a).
“Certificate
of Merger” has the meaning set forth in Section 2.01(c).
“Certificates”
has the meaning set forth in Section 2.03(a).
“Chosen
Courts” has the meaning set forth in Section 11.08.
“Clean
Team Agreement” has the meaning set forth in Section 1.02.
“Closing”
has the meaning set forth in Section 2.01(b).
“Closing
Date” has the meaning set forth in Section 2.01(b).
“Code”
means the U.S. Internal Revenue Code of 1986.
“Commitment
Letters” has the meaning set forth in Section 5.09(b).
“Company”
has the meaning set forth in the Preamble.
“Company
Balance Sheet” means the consolidated balance sheet of the Company as of December 31, 2022, and the footnotes thereto set forth
in the Company’s annual report on Form 10-K for the fiscal year ended December 31, 2022.
“Company
Capitalization Date” has the meaning set forth in Section 4.05(a).
“Company
Common Shares” has the meaning set forth in Section 4.05(a).
“Company
Credit Agreement” means that certain Credit Agreement, dated as of February 16, 2016, among the Company, the lenders from time
to time party thereto and Deutsche Bank AG New York Branch, as amended prior to the Closing Date.
“Company
Disclosure Schedule” means the disclosure schedule dated the date hereof regarding this Agreement that has been provided by
the Company to Parent and Merger Sub or their Representatives.
“Company
Indenture” means that certain Indenture, dated as of September 24, 2021, by and between the Company and U.S. Bank National
Association, as trustee, and the other parties thereto, governing the Company’s 4.375% Senior Notes due 2029, as amended prior
to the Closing Date.
“Company
IT Systems” has the meaning set forth in Section 4.15(f).
“Company
Material Adverse Effect” means any Effect that, individually or in the aggregate, has had or would reasonably be expected to
have a material adverse effect on (a) the financial condition, assets, business or results of operations of the Company and its Subsidiaries,
taken as a whole, excluding any Effect to the extent resulting from (i) changes or prospective changes in GAAP or the interpretation
thereof, (ii) general economic, political, regulatory, legal or tax conditions in the United States or any other country or region, including
changes in financial, credit, securities or currency markets (including changes in interest or exchange rates) and the imposition or
adjustment of tariffs, (iii) conditions generally affecting any of the industries in which the Company and its Subsidiaries operate,
(iv) changes or prospective changes in Applicable Law or the interpretation thereof, (v) geopolitical conditions, the outbreak or escalation
of hostilities, acts of war, sabotage, terrorism, cyberattacks, protests, riots, strikes, global health conditions (including any epidemic,
pandemic or disease outbreak) or natural disasters, (vi) the execution, delivery and performance of this Agreement or the announcement
or consummation of the transactions contemplated by this Agreement or the identity of or any facts or circumstances relating to Parent
or any of its Affiliates, including the impact of any of the foregoing on the business relationships, contractual or otherwise, of the
Company and any of its Subsidiaries with customers, suppliers, service providers, employees, Governmental Authorities or any other business
relationships resulting from any of the foregoing (provided that this clause (vi) shall not apply to any representation or warranty to
the extent such representation or warranty expressly purports to address, as applicable, the consequences resulting from the execution,
delivery and performance of this Agreement or the announcement or consummation of the transactions contemplated by this Agreement, including
as provided in Section 4.04), (vii) any actions requested in writing to be taken (or omitted to be taken) by or on behalf of Parent
or Merger Sub, (viii) any failure by the Company or any of its Subsidiaries to meet any internal or published budgets, projections, forecasts
or predictions of financial performance or integration synergies for any period, (ix) changes in the price or trading volume of the shares
of Company Common Shares or any other securities of the Company on the NYSE or any other market on which such securities are quoted for
purchase and sale or changes in the credit ratings of the Company (it being understood that any underlying facts giving rise or contributing
to the failure or changes described in clauses (viii) or (ix) that are not otherwise excluded from the definition of a “Company
Material Adverse Effect” may be taken into account in determining whether there has been a Company Material Adverse Effect), or
(x) any actions taken (or omitted to be taken) by the Company or any of its Subsidiaries that are required or expressly permitted to
be taken (or omitted to be taken) pursuant to this Agreement, including any actions required under this Agreement to obtain any approvals,
consents, registrations, permits, authorizations and other confirmations under applicable Competition Laws for the consummation of the
Merger, except, with respect to clauses (i), (ii), (iii), (iv) and (v), to the extent that such Effect is disproportionately adverse
to the Company and its Subsidiaries relative to others in the industry or industries in which the Company and its Subsidiaries operate,
in which case only the incremental disproportionate adverse Effect may be taken into account in determining whether a Company Material
Adverse Effect has occurred or would reasonably be expected to occur or (b) the ability of the Company to consummate the Merger on or
prior to the End Date.
“Company
Organizational Document Amendment” has the meaning set forth in Section 6.02.
“Company-Owned
Intellectual Property” means any and all Intellectual Property owned by the Company or any of its Subsidiaries.
“Company
Plan” means any “employee benefit plan” as defined in Section 3(3) of ERISA (whether or not subject to ERISA) and
each other employment, individual consulting, bonus, incentive, termination, severance, separation, change in control, retention, profit-sharing,
pension, retirement, deferred compensation, equity or equity-based, health or other welfare, disability, post-employment welfare or other
compensation or benefit plan, program, policy or agreement, in each case that is sponsored, maintained, contributed to or required to
be contributed to by the Company or any of its Subsidiaries for the benefit of any Company Service Provider or with respect to which
the Company or any of its Subsidiaries has or could reasonably be expected to have any liabilities, other than any such plan, policy
or agreement that is (i) a Multiemployer Plan, or (ii) operated by any Governmental Authority.
“Company
Preferred Shares” has the meaning set forth in Section 4.05(a).
“Company
Recommendation” has the meaning set forth in Section 4.02(b).
“Company
Registered Intellectual Property” has the meaning set forth in Section 4.15(c).
“Company
Restricted Shares” means an award of restricted shares of Company Common Shares that are subject to vesting or forfeiture granted
under a Company Stock Plan.
“Company
RSU” means a restricted stock unit that is subject to vesting conditions based solely on continued employment or service granted
under a Company Stock Plan.
“Company
SEC Documents” has the meaning set forth in Section 4.07(a).
“Company
Securities” has the meaning set forth in Section 4.05(c).
“Company
Service Provider” means any current or former employee, officer, director or independent contractor of the Company or any of
its Subsidiaries, in each case who is a natural person (whether retained directly by the Company or its applicable Subsidiary or indirectly
through a third-party entity, staffing company, or other Person).
“Company
Stock Plan” means the Amended and Restated PGT Innovations, Inc. 2019 Equity and Incentive Compensation Plan, as most recently
amended and/or restated.
“Company
Stockholder Approval” has the meaning set forth in Section 4.02(a).
“Company
Stockholders Meeting” has the meaning set forth in Section 6.02.
“Company
Subsidiary Securities” has the meaning set forth in Section 4.06(b).
“Company
Termination Fee” has the meaning set forth in Section 11.04(b)(i).
“Compliant”
means, as of any time of determination, with respect to any Required Information, that (i) such Required Information, taken as a whole,
does not contain any untrue statement of a material fact or omit to state any material fact regarding the Company necessary in order
to make such Required Information, in light of the circumstances under which the statements contained therein are made, not misleading;
provided that the availability of financial information of the Company, including any “flash” numbers, prior to the time
that the Required Information would become not Compliant for periods subsequent to the latest quarterly or annual period for which financial
information is included in the Required Information, shall not, by virtue of such availability, render such previously delivered Required
Information not Compliant, (ii) no independent auditor has withdrawn its audit opinion with respect to any financial statements contained
in the Required Information, (iii) such Required Information is compliant in all material respects with all applicable requirements of
Regulation S-K and Regulation S-X under the Securities Act and in a form customarily included in private placements of debt securities
under Rule 144A of the Securities Act and (iv) the financial statements and other financial information included in such Required Information
would not be deemed “stale” for use in a private placement of debt securities under Rule 144A of the Securities Act, and
are of a date and remain otherwise sufficient throughout the Marketing Period, in each case, to permit the Company’s independent
accountants to issue customary “comfort” letters with respect to such financial statements and financial information to the
Debt Financing Sources providing the portion of the Debt Financing consisting of debt securities (including customary “negative
assurance” comfort) in order to consummate any private placement of debt securities under Rule 144A of the Securities Act during
any Business Day during the Marketing Period.
“Competition
Laws” means the HSR Act and all other Applicable Laws that are designed or intended to prohibit, restrict or regulate actions
having the purpose or effect of monopolization, lessening of competition or restraint of trade.
“Confidentiality
Agreement” has the meaning set forth in Section 6.03(b).
“Continuing
Employee” has the meaning set forth in Section 7.03(b).
“D&O
Insurance” has the meaning set forth in Section 7.02(d).
“Data
Security Requirements” means, collectively, all of the following to the extent relating to personal, sensitive, or confidential
information or data or otherwise relating to privacy, security, or security breach notification requirements and, in each case, applicable
to the Company or any of its Subsidiaries, the conduct of their businesses, or any Company IT System: (i) the Company and its Subsidiaries’
own published rules, policies, and procedures (whether physical or technical in nature, or otherwise), (ii) all Applicable Laws, and
all binding industry standards applicable to the Company and its Subsidiaries’ industry (including, to the extent applicable, the
Payment Card Industry Data Security Standard (PCI DSS)), and (iii) agreements relating to the processing of personal information that
the Company or any of its Subsidiaries has entered into or by which it is bound.
“Debt
Commitment Letter” has the meaning set forth in Section 5.09(a).
“Debt
Financing” has the meaning set forth in Section 5.09(a).
“Debt
Financing Sources” means the entities that have committed to provide or otherwise entered into agreements in connection with
the Debt Financing, including the parties to the Debt Commitment Letter (including any Alternative Financing Commitment Letter that provides
for debt financing) and any joinder agreements, credit agreements or indentures (or similar definitive financing documents) relating
thereto. For the avoidance of doubt, neither Parent nor Merger Sub shall be considered a Debt Financing Source.
“Debt
Financing Sources Related Parties” means the Debt Financing Sources, the respective Affiliates of each of the foregoing and
the respective officers, directors, employees, controlling Persons, agents, advisors and the other Representatives and successors of
each of the foregoing. For the avoidance of doubt, neither Parent nor Merger Sub shall be considered a Debt Financing Sources Related
Party.
“DGCL”
means the Delaware General Corporation Law.
“Dissenting
Company Shares” has the meaning set forth in Section 2.04(a).
“Effect”
means any change, effect, development, circumstance, condition, fact, state of facts, event or occurrence.
“Effective
Time” has the meaning set forth in Section 2.01(c).
“End
Date” has the meaning set forth in Section 10.01(b)(i).
“Enforceability
Exceptions” has the meaning set forth in Section 4.02(a).
“Environmental
Laws” means any Applicable Laws relating to (a) the protection, preservation or restoration of the environment (including air,
water vapor, surface water, groundwater, drinking water supply, surface land, subsurface land, plant and animal life or any other natural
resource) or (b) the exposure to, or the use, storage, recycling, treatment, generation, transportation, processing, handling, labeling,
production, presence, release or disposal of hazardous substances or materials.
“Equity
Commitment Letter” has the meaning set forth in Section 5.09(b).
“Equity
Financing” has the meaning set forth in Section 5.09(b).
“Equity
Financing Sources” means the entities that have committed to provide or otherwise entered into agreements in connection with
the Equity Financing, including the parties to the Equity Commitment Letter and any joinder agreements, purchase agreements, investor
rights agreements, shareholder agreements or certificates of designation (or similar definitive equity financing documents) relating
thereto. For the avoidance of doubt, neither Parent nor Merger Sub shall be considered an Equity Financing Source.
“Equity
Financing Sources Related Parties” means the Equity Financing Sources, the respective Affiliates of each of the foregoing and
the respective officers, directors, employees,
controlling Persons,
agents, advisors and the other Representatives and successors of each of the foregoing. For the avoidance of doubt, neither Parent nor
Merger Sub shall be considered an Equity Financing Sources Related Party.
“ERISA”
means the Employee Retirement Income Security Act of 1974.
“ESPP”
means the PGT Innovations, Inc. 2019 Employee Stock Purchase Plan.
“Exchange
Agent” has the meaning set forth in Section 2.03(a).
“Excluded
Information” means any (i) pro forma financial statements (but excluding financial information relating solely to the Company
necessary for Parent to prepare the pro forma financial statements as of and for the twelve-month period ending on the last day of the
most recently completed four-fiscal quarter period ended at least 45 days (or, if such four-fiscal quarter period ends on the last day
of a fiscal year, at least 90 days) before the last day of the Marketing Period, prepared after giving effect to the transactions contemplated
hereby as if such transactions had occurred as of such date (in the case of such balance sheet) or at the beginning of such period (in
the case of such statement of income)), (ii) description of all or any portion of the Debt Financing, including any “description
of notes,” “plan of distribution” and other information customarily provided by Parent, the Debt Financing Sources
or their counsel, (iii) risk factors relating to all or any component of the Debt Financing, (iv) “segment” financial information,
(v) other information required by Rules 3-05, 3-09, 3-10 or 3-16 of Regulation S-X under the Securities Act, any Compensation Discussion
and Analysis or other information required by Item 402 of Regulation S-K under the Securities Act or the executive compensation and related
person disclosure rules related to SEC Release Nos. 33-8732A, 34-54302A and IC-27444A or any other information customarily excluded from
an offering memorandum for private placements of non-convertible high-yield debt securities under Rule 144A promulgated under the Securities
Act or (vi) any financial information or other information (other than the financial statements and other information set forth in the
definition of Required Information) that is not reasonably available to the Company under its current reporting systems or that the Company
is not reasonably able to produce without undue burden.
“Ex-Im
Laws” means all applicable laws and regulations relating to export, re-export, transfer or import controls (including, without
limitation, the Export Administration Regulations administered by the U.S. Department of Commerce, and customs and import laws and regulations
administered by U.S. Customs and Border Protection).
“Financing”
has the meaning set forth in Section 5.09(b).
“Financing
Sources Related Parties” means the Equity Financing Sources Related Parties and the Debt Financing Sources Related Parties.
“FTC”
has the meaning set forth in Section 8.01(b).
“GAAP”
means generally accepted accounting principles in the United States.
“Governmental
Authority” means any transnational, domestic or foreign federal, state or local governmental, regulatory or administrative
authority, department, court, agency or official, or the NYSE or any self-regulatory organization.
“Hazardous
Substance” means any (i) material, substance or waste that is listed, defined or regulated as “hazardous” or “toxic,”
or as a “pollutant” or “contaminant” (or words of similar meaning and regulatory effect) under Environmental
Laws; and (ii) petroleum, petroleum products, per- and polyfluoroalkyl substances (including PFAs, PFOA, PFOS, Gen X, and PFBs), polychlorinated
biphenyls (PCBs), asbestos and asbestos-containing materials, radon, and toxic mold or fungi.
“HSR
Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and regulations promulgated
thereunder.
“Indemnified
Person” has the meaning set forth in Section 7.02(a).
“Intellectual
Property” means all intellectual property and similar proprietary rights in any jurisdiction anywhere in the world, including
in the following: trademarks, service marks and trade names (including any and all goodwill related thereto), domain names, mask works,
inventions, patents, trade secrets, copyrights, rights in software, data, databases and documentation thereof, know-how, technology and
any other similar type of proprietary intellectual property rights and any registrations or applications for registration of any of the
foregoing.
“Interim
Company Restricted Shares” has the meaning set forth in Section 2.05(f).
“Internal
Controls” has the meaning set forth in Section 4.07(d).
“Intervening
Event” has the meaning set forth in Section 6.04(f).
“IRS”
has the meaning set forth in Section 4.17(a).
“Knowledge”
means (i) with respect to the Company, the actual knowledge after reasonable inquiry of the individuals listed on Section 1.01(a)(i)
of the Company Disclosure Schedule and (ii) with respect to Parent, the actual knowledge after reasonable inquiry of the individuals
listed on Section 1.01(a)(ii) of the Parent Disclosure Schedule.
“Lease”
has the meaning set forth in Section 4.14(c).
“Lien”
means, with respect to any property or asset, any mortgage, lien, pledge, charge, security interest, encumbrance, exclusive license or
other similar adverse claim of any kind in respect of such property or asset.
“Marketing
Period” means the first period of fifteen (15) consecutive Business Days commencing on the earlier of (a) May 13, 2024 and
(b) the later of (i) March 7, 2024 and (ii) the first Business Day following the date that the condition set forth in Section 9.01(c)
has been satisfied or, to the extent permitted by Applicable Law, waived and during and at the end of which Parent has received all
Required Information and, solely in the event that a Structure Flex Event has occurred, throughout which period all such Required Information
is Compliant; provided that
(A) none of May
27, 2024, July 4, 2024, July 5, 2024 and November 27, 2024 through November 29, 2024 shall be Business Days for purposes of calculating
the Marketing Period (provided, for the avoidance of doubt, that such exclusions in this clause (A) shall not restart such period), (B)
if such fifteen (15) consecutive Business Day period has not ended on or prior to August 16, 2024, then such fifteen (15) consecutive
Business Day period shall not commence until September 3, 2024 and (C) if such fifteen (15) consecutive Business Day period would not
end on or prior to December 20, 2024, then such fifteen (15) consecutive Business Day period shall not commence until January 2, 2025;
provided further that the Marketing Period shall end on any earlier date that is the date on which the Debt Financing is fully consummated.
If the Company shall in good faith reasonably believe it has provided all of the Required Information, it may deliver to the Parent a
written notice to that effect (stating when it believes it completed such delivery), in which case the Marketing Period shall be deemed
to have commenced as of the Business Day immediately following the delivery date indicated in such written notice unless Parent in good
faith reasonably believes the Company has not completed the delivery of all of the Required Information and, within two (2) Business
Days after the delivery of such notice by the Company, delivers a written notice to the Company to that effect (stating with specificity
which Required Information the Company has not delivered); provided that it is understood that the delivery of such written notice from
the Parent to the Company will not prejudice the Company’s right to assert that all of the Required Financial Information has in
fact been delivered. If no Structure Flex Event has occurred, in no event shall the Marketing Period restart if additional financial
statements constituting Required Information become available after the Marketing Period has commenced. If a Structure Flex Event has
occurred, in no event shall the Marketing Period restart if additional financial statements constituting Required Information become
available after the Marketing Period has commenced so long as all previously delivered Required Information is and remains Compliant
for the duration of the Marketing Period.
“Masonite”
has the meaning set forth in the Recitals.
“Masonite
Agreement” has the meaning set forth in the Recitals.
“Material
Contract” has the meaning set forth in Section 4.20(a).
“Merger”
has the meaning set forth in Section 2.01(a).
“Merger
Consideration” has the meaning set forth in Section 2.02(a).
“Merger
Sub” has the meaning set forth in the Preamble.
“Multiemployer
Plan” has the meaning set forth in Section 4.17(e).
“NYSE”
means the New York Stock Exchange.
“Order”
means any order, writ, injunctions, judgments or decrees of any Governmental Authority.
“Parent”
has the meaning set forth in the Preamble.
“Parent
Disclosure Schedule” means the disclosure schedule dated the date hereof regarding this Agreement that has been provided by
Parent to the Company or its Representatives.
“Parent
Material Adverse Effect” means any Effect that would reasonably be expected to prevent, impair or materially delay the ability
of Parent or Merger Sub to perform its material obligations hereunder or prevent, impair or materially delay the consummation of the
Merger or the other transactions contemplated hereby on or prior to the End Date.
“Parent
Regulatory Termination Fee” has the meaning set forth in Section 11.04(b)(iv).
“Parent
Termination Fee” has the meaning set forth in Section 11.04(b)(iii).
“Permit”
means each governmental license, franchise, certificate, approval, registration, order, decree or other similar authorization of a Governmental
Authority relating to the assets or business of the Company or its Subsidiaries which is necessary for the conduct of the business as
currently conducted.
“Permitted
Liens” means (a) any Liens for Taxes not yet due and payable or which are being contested in good faith by appropriate proceedings
and, in each case, for which adequate accruals, in accordance with GAAP, are reflected in the Company Balance Sheet, (b) vendors’,
carriers’, warehousemen’s, mechanics’, materialmen’s, worker’s, repairmen’s or other similar Liens
incurred in the ordinary course of business and which are not delinquent or which are being contested in good faith and for which adequate
accruals in accordance with GAAP, are reflected in the Company Balance Sheet, (c) Liens incurred or deposits made in the ordinary course
of business in connection with workers’ compensation, unemployment insurance and other social security legislation, (d) gaps in
the chain of title evident from the records of the applicable Governmental Authority maintaining such records and other encumbrances
of record as of the date of this Agreement, (e) easements, rights-of-way, covenants, restrictions and other encumbrances incurred in
the ordinary course of business that, in the aggregate, are not material in amount or that do not, in any case, materially detract from
the value or the use of the property subject thereto, (f) statutory landlords’ Liens and Liens granted to landlords under any lease,
(g) non-exclusive licenses to Intellectual Property granted in the ordinary course of business, (h) any purchase money security interests,
equipment leases or similar financing arrangements, (i) any Liens securing indebtedness or liabilities that are reflected on the most
recent consolidated balance sheet of the Company or notes thereto, (j) with respect to any securities, any transfer restrictions of general
applicability as may be provided under the 1933 Act or other Applicable Law or restrictions under the organizational documents of the
issuer of such securities, (k) Liens as set forth on Section 1.01(b) of the Company Disclosure Schedule, and (l) any Liens that do not
materially and adversely affect the use or operation of the property or assets subject thereto.
“Person”
means an individual, corporation, partnership, limited liability company, association, trust or other entity or organization, including
a Governmental Authority.
“Proceeding”
means any action, claim, charge, complaint, arbitration, mediation, litigation, suit or other similarly formal legal proceeding commenced,
brought, conducted, or heard by or before, any Governmental Authority or arbitrator.
“Proxy
Statement” has the meaning set forth in Section 8.02(a).
“Regulatory
Actions” has the meaning set forth in Section 8.01(c).
“Representatives”
means, with respect to a Person, such Person’s directors, managers, officers, employees, investment bankers, attorneys, accountants
and other advisors acting on such Person’s behalf.
“Required
Information” means (x) the historical financial information of the Company described in, and other financial information of
the Company reasonably necessary to assist Parent in preparing the pro forma financial statements as of and for the twelve-month period
ending on the last day of the most recently completed four-fiscal quarter period ended at least 45 days (or, if such four-fiscal quarter
period ends on the last day of a fiscal year, at least 90 days) before the last day of the Marketing Period, prepared after giving effect
to the transactions contemplated hereby as if such transactions had occurred as of such date (in the case of such balance sheet) or at
the beginning of such period (in the case of such statement of income) and (y) solely in the event that a Structure Flex Event has occurred,
(i) other information with respect to the Company of the type required by Regulation S-X or Regulation S-K under the Securities Act in
connection with a registered offering of debt securities, (ii) information with respect to the Company of the type and form that is customarily
included in a private placement of debt securities pursuant to Rule 144A promulgated under the Securities Act and (iii) drafts of customary
comfort letters (including as to customary “negative assurance” comfort and change period) from the Company’s independent
accountants with respect to any of the foregoing information, subject to the completion by such accountants of customary procedures relating
thereto. Notwithstanding anything to the contrary in this Agreement, nothing will require the Company to provide (or be deemed to require
the Company to prepare), and the Required Information shall be deemed to exclude, any Excluded Information (other than clause (iv) of
the definition thereof).
“Rights
Agreement” means the Rights Agreement, dated as of March 30, 2023, between the Company and American Stock Transfer & Trust
Company, LLC, as Rights Agent.
“Sanctioned
Person” means at any time any Person: (i) listed on any Sanctions-related list of designated or blocked Persons; (ii) ordinarily
resident in or organized under the laws of a country or territory that is the subject of comprehensive Sanctions (as of the date of this
Agreement, Cuba, Iran, North Korea, Syria, the Crimea, Sevastopol, Donetsk, Luhansk, Kherson and Zaporizhzhia regions of Ukraine and
Venezuela); or (iii) owned directly or indirectly, fifty percent (50%) or more (in the aggregate) or otherwise controlled by any of the
foregoing.
“Sanctions”
means, collectively, the sanctions administered or enforced by the United States Government (including the U.S. Department of the Treasury’s
Office of Foreign Assets Control), the United Nations Security Council, the European Union and its member states, and His Majesty’s
Treasury.
“SEC”
means the U.S. Securities and Exchange Commission.
“Solvent”
has the meaning set forth in Section 5.10.
“Specified
Date” has the meaning set forth in Section 10.01(b)(i).
“Structure
Flex Event” means either (i) a “Structure Flex Decision” (as defined in the Debt Commitment Letter as in effect
on the date hereof) has been exercised under the Debt Commitment Letter or (ii) a “Structure Flex Securities Demand” (as
defined in the Debt Commitment Letter as in effect on the date hereof) has been exercised under the Debt Commitment Letter, in each case
of clauses (i) and (ii), prior to the initial commencement of the Marketing Period.
“Subsidiary”
means, with respect to any Person, (i) any entity of which such person, directly or indirectly, owns (A) securities or other ownership
interests having ordinary voting power to elect a majority of the board or other governing body of directors or other Person or body
performing similar functions or (B) more than fifty percent (50%) of the outstanding equity or financial interests or (ii) any entity
in which such Person is or any of its Subsidiaries is a general partner or managing member of such other Person.
“Superior
Proposal” has the meaning set forth in Section 6.04(e).
“Surviving
Corporation” has the meaning set forth in Section 2.01(a).
“Tax”
means any tax or other assessment, duty, impost, fee or charge in the nature of a tax (including withholding on amounts paid to or by
any Person), together with any interest, penalty, addition to tax or additional amount imposed by any Governmental Authority (a “Taxing
Authority”) responsible for the imposition of any such tax.
“Tax
Return” means any report, return, document, declaration or other information or filing supplied or required to be supplied
to any Taxing Authority with respect to Taxes, including information returns, any documents with respect to or accompanying payments
of estimated Taxes, or with respect to or accompanying requests for the extension of time in which to file any such report, return, document,
declaration or other information, including any amendments thereof and schedules or attachments thereto.
“Taxing
Authority” has the meaning set forth in the definition of “Tax.”
“Third
Party” means any Person, including as defined in Section 13(d) of the 1934 Act, other than the Company, Parent or any of their
respective Affiliates.
“Uncertificated
Shares” has the meaning set forth in Section 2.03(a).
Section
1.02 Other Definitional
and Interpretative Provisions. The words “hereof,” “herein” and “hereunder” and words of like
import used in this Agreement will refer to this Agreement as a whole and not to any particular provision of this Agreement. The captions
herein are included for convenience of reference only and will be ignored in the construction or interpretation hereof. References to
“Articles,” “Sections,” “Exhibits,” “Annexes” and “Schedules” are to Articles,
Sections, Exhibits, Annexes and Schedules of this Agreement unless otherwise specified. All Exhibits, Annexes and Schedules annexed hereto
or referred to herein are hereby incorporated in and made a part of this Agreement as if set forth in full herein. Any
capitalized terms
used in any Exhibit, Annex or Schedule but not otherwise defined therein will have the meaning as defined in this Agreement. Any singular
term in this Agreement will be deemed to include the plural, and any plural term the singular. Whenever the words “include,”
“includes” or “including” are used in this Agreement, they will be deemed to be followed by the words “without
limitation,” whether or not they are in fact followed by those words or words of like import. References to “ordinary course
of business” will be deemed to be followed by the words “consistent with past practices” with such practices being
interpreted hereunder taking into account the circumstances thereof. “Writing,” “written” and comparable terms
refer to printing, typing and other means of reproducing words (including electronic media) in a visible form. The word “or”
will not be deemed to be exclusive. The word “extent” and the phrase “to the extent” when used in this Agreement
will mean the degree to which a subject or other thing extends, and such word or phrase will not simply mean “if.” References
to any statute, law or other Applicable Law will be deemed to refer to such statute, law or other Applicable Law as amended from time
to time and, if applicable, to any rules, regulations or interpretations promulgated thereunder. References to any agreement or contract
are to that agreement or contract as amended, modified or supplemented from time to time in accordance with the terms hereof and thereof.
References to any Person include the successors and permitted assigns of that Person. References to a “party” or the “parties”
mean a party or the parties to this Agreement unless the context otherwise requires. References to “transactions contemplated hereby”
shall not include approval of the Company Organizational Document Amendment at the Company Stockholders Meeting. References from or through
any date mean, unless otherwise specified, from and including or through and including, respectively. Except as otherwise expressly set
forth herein, all amounts required to be paid hereunder will be paid in United States currency in the manner and at the times set forth
herein. Whenever this Agreement requires Merger Sub to take any action, such requirement will be deemed to include an undertaking on
the part of Parent to cause Merger Sub to take such action. The parties hereto have participated jointly in the negotiation and drafting
of this Agreement, and each has been represented by counsel of its choosing and, in the event an ambiguity or question of intent or interpretation
arises, this Agreement will be construed as if drafted jointly by such parties and no presumption or burden of proof will arise favoring
or disfavoring any party due to the authorship of any provision of this Agreement. Unless otherwise specifically indicated, all references
to “dollars” and “$” will be deemed references to the lawful money of the United States of America. References
to “law,” “laws” or to a particular statute or law will be deemed to also include any Applicable Law. References
to documents or information “made available” or “provided” to Parent or similar terms will mean documents or
information (i) publicly available on the SEC EDGAR database (without redaction or omission) prior to the execution of this Agreement;
(ii) delivered by or on behalf of the Company to Parent or Parent’s representatives via e-mail or in hard copy form at least one
day prior to the date of this Agreement or (iii) uploaded prior to the execution of this Agreement in the “Project Neptune”
dataroom hosted on Datasite at least one day prior to the date of this Agreement and is fully available and visible to Parent and its
Representatives (or, in the case of Clean Team Confidential Information (as defined in that certain Clean Team Agreement, dated as of
January 9, 2024, by and between the Company and Parent (the “Clean Team Agreement”)), is fully available and visible
to Parent’s Permitted Persons (as defined therein) at least one day prior to the date of this Agreement). References to documents
or information “made available” or “provided” to the Company or similar terms will mean documents or information
(i) publicly available on the SEC EDGAR database (without redaction or omission) prior to the execution of this Agreement; (ii) delivered
by or on behalf of Parent to the Company
or the Company’s
representatives via e-mail or in hard copy form prior to the execution of this Agreement; or (iii) uploaded prior to the execution of
this Agreement into an electronic dataroom at least one day prior to the date of this Agreement and is fully available and visible to
the Company and its Representatives (or, in the case of Clean Team Confidential Information (as defined in the Clean Team Agreement),
is fully available and visible to the Company’s Permitted Persons (as defined therein) at least one day prior to the date of this
Agreement). In interpreting and construing this Agreement, effect will be given to the provisions set forth in Section 1.02 of
the Company Disclosure Schedule.
Article
2
The Merger
Section
2.01 The Merger.
(a)
At the Effective Time, Merger Sub will merge with and into the Company (the “Merger”) in accordance with the
DGCL, whereupon the separate existence of Merger Sub will cease, and the Company will be the surviving corporation as a wholly owned
Subsidiary of Parent (the “Surviving Corporation”).
(b)
Subject to the provisions of Article 9, the closing of the Merger (the “Closing”) will take place in
New York City at the offices of Davis Polk & Wardwell LLP, 450 Lexington Avenue, New York, New York 10017 or through the electronic
exchange of the applicable documents, using PDFs or electronic signatures as soon as possible, but in any event (i) no later than three
(3) Business Days after the date the last of the conditions set forth in Article 9 (other than conditions that by their nature
are to be satisfied at the Closing, but subject to the satisfaction or, to the extent permissible, waiver of those conditions at the
Closing) has been satisfied or, to the extent permissible, waived by the party or parties entitled to the benefit of such conditions,
or at such other place, at such other time or on such other date as Parent and the Company may mutually agree in writing; provided
that, if the Marketing Period has not ended at the time of the satisfaction or waiver of the last of the conditions set forth in
Article 9 (other than conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or,
to the extent permissible, waiver of those conditions at the Closing), the Closing shall take place on the earlier to occur of (x) any
Business Day before or during the Marketing Period as may be specified by Parent on no fewer than three (3) Business Days’ written
notice to the Company and (y) the third Business Day immediately following the final day of the Marketing Period (subject, in each case,
to the satisfaction or, to the extent permissible, waiver of all of the conditions set forth in Article 9 as of the date determined
pursuant to this proviso (other than conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction
or, to the extent permissible, waiver of those conditions at the Closing)) or (ii) such other time or on such other date as Parent and
the Company may mutually agree in writing. The date on which the Closing actually occurs is referred to herein as the “Closing
Date.”
(c)
At the Closing, the Company and Merger Sub shall file a certificate of merger (the “Certificate of Merger”)
with the Delaware Secretary of State and make all other filings or recordings required by the DGCL in connection with the Merger. The
Merger will become effective at such time as the Certificate of Merger is duly filed with the Delaware Secretary
of State (or at
such later time as may be specified in the Certificate of Merger) (the “Effective Time”).
(d)
From and after the Effective Time, the Surviving Corporation will possess all the rights, powers, privileges and franchises and
be subject to all of the obligations, liabilities, restrictions and disabilities of the Company and Merger Sub, all as provided under
the DGCL.
Section
2.02 Conversion of Shares.
(a)
Except as otherwise provided in Section 2.02(b), Section 2.02(c) or Section 2.04, each Company Common Share
outstanding immediately prior to the Effective Time (including each Company Restricted Share, subject to Section 2.05(a)) will
automatically be converted into the right to receive $42.00 in cash without interest (the “Merger Consideration”).
As of the Effective Time, all such Company Common Shares will no longer be outstanding and will automatically be canceled and retired
and will cease to exist, and will thereafter represent only the right to receive the Merger Consideration to be paid in accordance with
Section 2.03, without interest.
(b)
Each Company Common Share held by the Company as a treasury share or owned by Parent, Merger Sub or any other Subsidiary of Parent
immediately prior to the Effective Time will be canceled and cease to exist, and no payment will be made with respect thereto. For the
avoidance of doubt, each Company Restricted Share and Company RSU shall be treated in accordance with Section 2.05.
(c)
Each Company Common Share held by any Subsidiary of the Company immediately prior to the Effective Time will be converted into
such number of common shares of the Surviving Corporation such that each Subsidiary owns the same percentage of the outstanding capital
stock in the Surviving Corporation immediately following the Effective Time as such Subsidiary owned in the Company immediately prior
to the Effective Time.
(d)
Each common share of Merger Sub outstanding immediately prior to the Effective Time will be converted into and become one common
share of the Surviving Corporation and, except as provided in Section 2.02(c), will constitute the only outstanding shares of
capital stock of the Surviving Corporation.
Section
2.03 Surrender and Payment.
(a)
At least ten (10) Business Days prior to the Closing Date, Parent shall appoint an agent reasonably acceptable to the Company
(the “Exchange Agent”) and enter into an exchange agent agreement, reasonably acceptable to the Company, with such
agent for the purpose of exchanging for the Merger Consideration as promptly as practicable after the Effective Time (i) certificates
representing Company Common Shares (the “Certificates”) or (ii) uncertificated Company Common Shares (the “Uncertificated
Shares”). At or immediately after the Effective Time, Parent shall make available to the Exchange Agent the aggregate Merger
Consideration to be paid in respect of the Certificates and the Uncertificated Shares. As promptly as practicable after the Effective
Time (but no later than two (2) Business Days thereafter), Parent shall send, or shall cause the Exchange Agent to send, to each holder
of Company Common Shares
at the Effective
Time a letter of transmittal and instructions (which will be in a form reasonably acceptable to the Company and finalized prior to the
Effective Time and which will specify that the delivery will be effected, and risk of loss and title will pass, only upon proper delivery
of the Certificates or transfer of the Uncertificated Shares to the Exchange Agent) for use in such exchange.
(b)
Each holder of Company Common Shares that have been converted into the right to receive the Merger Consideration will be entitled
to receive, upon (i) surrender to the Exchange Agent of a Certificate, together with a properly completed letter of transmittal, or (ii)
receipt of an “agent’s message” by the Exchange Agent (or such other evidence, if any, of transfer as the Exchange
Agent may reasonably request) in the case of a book-entry transfer of Uncertificated Shares, the Merger Consideration payable for each
Company Common Share represented by a Certificate or for each Uncertificated Share (less any applicable withholding). Until so surrendered
or transferred, as the case may be, each such Certificate or Uncertificated Share will represent from and after the Effective Time for
all purposes only the right to receive the Merger Consideration. No interest will be paid or will accrue on the cash payable upon surrender
of any such Company Common Shares.
(c)
If any portion of the Merger Consideration is to be paid to a Person other than the Person in whose name the surrendered Certificate
or the transferred Uncertificated Share is registered, it will be a condition to such payment that (i) either such Certificate shall
be properly endorsed or shall otherwise be in proper form for transfer or such Uncertificated Share shall be properly transferred and
(ii) the Person requesting such payment shall pay to the Exchange Agent any transfer or other Taxes required as a result of such payment
to a Person other than the registered holder of such Certificate or Uncertificated Share or establish to the satisfaction of the Exchange
Agent that such Tax has been paid or is not payable.
(d)
At the Effective Time, the share transfer books of the Company will be closed, and there will be no further registration of transfers
of Company Common Shares. If, after the Effective Time, Certificates or Uncertificated Shares are presented to the Surviving Corporation
or the Exchange Agent, they will be canceled and exchanged for the Merger Consideration provided for, and in accordance with the procedures
set forth, in this Article 2.
(e)
Any portion of the Merger Consideration made available to the Exchange Agent pursuant to Section 2.03(a) (and any interest
or other income earned thereon) that remains unclaimed by the holders of Company Common Shares twelve (12) months after the Effective
Time will be returned to Parent, upon demand, and any such holder who has not exchanged any Company Common Share for the Merger Consideration
in accordance with this Section 2.03 prior to that time will thereafter look only to Parent for payment of the Merger Consideration
in respect of such Company Common Share without any interest thereon (subject to abandoned property escheat or similar Applicable Law).
Notwithstanding the foregoing, none of Parent, the Surviving Corporation or the Exchange Agent will be liable to any holder of Company
Common Shares for Merger Consideration delivered to a Governmental Authority pursuant to any applicable abandoned property, escheat or
similar Applicable Law. If any Certificate shall not have been surrendered or Uncertificated Share shall not have been transferred prior
to such date on which any Merger Consideration would otherwise escheat to or become the property of any Governmental Authority, then
any such Merger Consideration will, to the extent permitted by
Applicable Law,
become the property of Parent, free and clear of all claims or interest of any Person previously entitled thereto.
Section
2.04 Dissenting Shares.
(a)
Notwithstanding anything to the contrary set forth in this Agreement, all Company Common Shares that are issued and outstanding
as of immediately prior to the Effective Time and held by the Company’s stockholders who shall have neither voted in favor of the
adoption of this Agreement nor consented thereto in writing and who shall have properly and validly demanded their statutory rights of
appraisal in respect of such Company Common Shares in accordance with Section 262 of the DGCL (the “Dissenting Company Shares”)
will not be converted into, or represent the right to receive, the Merger Consideration pursuant to Section 2.02(a). Such Company
stockholders will be entitled to receive payment of the appraised value of such Dissenting Company Shares in accordance with the provisions
of Section 262 of the DGCL, except that all Dissenting Company Shares held by Company stockholders who shall have failed to perfect or
who shall have effectively withdrawn or lost their rights to appraisal of such Dissenting Company Shares pursuant to Section 262 of the
DGCL will thereupon be deemed to have been converted into, and to have become exchangeable for, as of the Effective Time, the right to
receive the Merger Consideration, without interest thereon, upon surrender of the Certificates or transfer of Uncertificated Shares that
formerly evidenced such Company Common Shares in the manner provided in Section 2.03 (or in the case of a lost, stolen or destroyed
Certificate, upon delivery of an affidavit (and bond, if required) in accordance with the provisions of Section 2.08).
(b)
The Company shall give Parent prompt notice of any demands for appraisal received by the Company, withdrawals of such demands,
and any other instruments served pursuant to the DGCL and received by the Company in respect of Dissenting Company Shares. Parent shall
have the right to participate in all negotiations and Proceedings with respect to demands for appraisal pursuant to the DGCL in respect
of Dissenting Company Shares. The Company may not, except with the prior written consent of Parent, make any payment with respect to
any demands for appraisal or settle or offer to settle any such demands in respect of Dissenting Company Shares.
Section
2.05 Treatment of Equity
Awards.
(a)
Effective as of immediately prior to the Effective Time, the restrictions on each Company Restricted Share granted and then outstanding
immediately prior to the Effective Time shall, without any action on the part of the holder thereof, Parent, Merger Sub or the Company,
lapse, and each such Company Restricted Share will be treated at the Effective Time the same as, and have the same rights and be subject
to the same conditions as, an outstanding share of Company Common Shares not subject to any restrictions, subject to any withholding
Taxes required by Applicable Law to be withheld; provided that, if there are any performance conditions applicable to any Company Restricted
Share, then the restrictions on such performance-based Company Restricted Share will lapse with respect to a number of Company Common
Shares that is calculated as set forth in Section 2.05(a) of the Company Disclosure Schedule and otherwise in accordance with
the Company Stock Plan and the applicable award agreement governing such performance-based Company Restricted Shares. For the avoidance
of doubt, any additional performance-based Company Restricted Share that may become earned and issuable pursuant to
the applicable
award agreement upon the applicable anniversary of the grant date of such performance-based Company Restricted Share and in accordance
with Section 2.05(a) of the Company Disclosure Schedule shall be considered granted and outstanding as of immediately prior to
the Effective Time for purposes of the foregoing calculation in this Section 2.05(a).
(b)
Effective as of immediately prior to the Effective Time, each Company RSU that is outstanding immediately prior to the Effective
Time shall be canceled and converted into the right to receive an amount equal to (i) the Merger Consideration, plus (ii) any accrued
but unpaid dividends or dividend equivalents in respect of such Company RSU as of the Effective Time.
(c)
Prior to the Effective Time, the compensation committee of the Board of Directors and the Board of Directors, as applicable,
shall have adopted any resolutions and have taken any actions that are necessary to effectuate the treatment of the Company Restricted
Shares and Company RSUs pursuant to this Section 2.05. As soon as practicable following the date hereof and in all events prior
to, and contingent upon, the Effective Time, the Company shall cause the Company Stock Plan to terminate at or prior to the Effective
Time.
(d)
At or prior to the date hereof, the Company or the Board of Directors, as
applicable, shall have adopted such resolutions and taken such other actions as may reasonably be required to provide that, (i) the ESPP
shall be frozen and suspended at the end of the “offering period” that is in progress as of the date of this Agreement and
no new offering periods shall commence under the ESPP at any time on or after the date hereof, (ii) no current participants in the ESPP
shall be permitted to increase their payroll deduction elections or rate of contributions under the ESPP from those in effect on the
date of this Agreement or make any separate non-payroll contributions to the ESPP on or following the date of this Agreement and no individuals
not participating in the ESPP as of the day before the date of this Agreement shall commence participation in the ESPP during the period
from the date of this Agreement through the Effective Time, (iii) effective upon the consummation of the transactions contemplated hereby,
any “offering period” that would otherwise be in progress as of the Effective Time will be accelerated in accordance with
Section 14 of the ESPP (including the provision of notices to participants in the ESPP as provided therein) to a date on or prior to
the fifth (5th) Business Day prior to the Closing Date and (iv) the ESPP shall terminate prior to, and contingent upon, the Effective
Time.
(e)
All payments under this Section 2.05 shall be made at or as soon as practicable after the Effective Time
(and in no event later than the next regularly scheduled payroll run of the Company or Surviving Corporation that is at least five (5)
Business Days following the Closing Date), pursuant to the Company’s or the Surviving Corporation’s ordinary payroll practices,
and will be subject to any applicable withholding.
(f)
Notwithstanding anything in Section 2.05(a), Section 2.05(b) or Section
2.05(c) to the contrary, but subject to Section 6.01(b), Section 6.01(l), and Section
6.01(m), any grant of any Company Restricted Shares made after the date hereof and before the Effective Time (such Company Restricted
Shares, “Interim Company Restricted Shares”) shall expressly provide for treatment that is different from the treatment
prescribed by this Section 2.05 such that, the Interim Company Restricted Shares, to the extent not forfeited pursuant to the
terms of the
Interim Company
Restricted Share prior to the Effective Time, (A) shall be converted into an award that entitles the holder thereof, upon vesting, to
receive an amount in cash equal to the Merger Consideration, plus any interest accrued on the basis of prime rate as published in The
Wall Street Journal in effect at the Effective Time, compounded quarterly, calculated on the basis of actual days elapsed (including
the Closing Date and each applicable vesting date) in respect of each Interim Company Restricted Share and (B) in the event that the
holder’s service is terminated by the Company or Surviving Corporation without Cause (as defined in the Company Stock Plan) or
by the holder for Good Reason (as defined in the Company Stock Plan) at the time of or within twenty-four (24) months following the Effective
Time, any unvested Interim Company Restricted Shares as of the date of such holder’s separation from service shall fully vest. Except
as otherwise provided in this Section 2.05(f), each cash-settled award covered by this Section
2.05(f) shall have the same terms and conditions (including vesting terms and conditions) as applied to the corresponding Interim
Company Restricted Share. All payments under this Section 2.05(f) shall be made at or as soon as practicable
after each applicable vesting date, pursuant to the Company’s or the Surviving Corporation’s ordinary payroll practices,
and will be subject to any applicable withholding.
Section
2.06 Adjustments. Without
limiting any rights or obligations otherwise set forth in this Agreement, if, during the period between the date of this Agreement and
the Effective Time, the outstanding shares of capital stock of the Company shall have changed into a different number or class of shares
by reason of any reclassification, recapitalization, share split or combination, exchange or readjustment of shares, or any share dividend
thereon with a record date during such period, but excluding any change that results from settlement of Company Restricted Shares or
Company RSUs, the Merger Consideration and any other amounts payable pursuant to this Agreement shall be appropriately adjusted.
Section
2.07 Withholding Rights.
Notwithstanding anything to the contrary herein, Parent, the Company, the Surviving Corporation and any of their respective Affiliates
or agents shall be entitled to deduct and withhold from any amounts otherwise payable pursuant to this Agreement such amounts as are
required to be deducted or withheld under the Code or any other Tax Applicable Law. Any amounts so deducted or withheld shall, to the
extent paid over to the appropriate Taxing Authority, be treated for all purposes of this Agreement as having been paid to the Person
in respect of which such deduction or withholding was made.
Section
2.08 Lost Certificates.
If any Certificate shall have been lost, stolen or destroyed, upon the making of an affidavit of that fact by the Person claiming such
Certificate to be lost, stolen or destroyed and, if required by the Surviving Corporation, an agreement to indemnify the Surviving Corporation
against any claim that may be made with respect to such Certificate (including, if required by the Surviving Corporation, the posting
by such Person of a bond, in such reasonable amount as the Surviving Corporation may direct), the Exchange Agent shall pay, in exchange
for such lost, stolen or destroyed Certificate, the Merger Consideration to be paid in respect of the Company Common Shares represented
by such Certificate, as contemplated by this Article 2.
Article
3
The Surviving Corporation
Section
3.01 Certificate of Incorporation.
At the Effective Time, the certificate of incorporation of the Surviving Corporation shall be amended and restated as set forth in Exhibit
A, and, as so amended and restated, shall be the certificate of incorporation of the Surviving Corporation until further amended in accordance
with Applicable Law.
Section
3.02 Bylaws. The bylaws
of Merger Sub in effect at the Effective Time will be the bylaws of the Surviving Corporation (except that references to the name of
Merger Sub shall be replaced by reference to the name of the Surviving Corporation) until thereafter amended in accordance with Applicable
Law.
Section
3.03 Directors and Officers.
Unless otherwise determined by Parent prior to the Effective Time, from and after the Effective Time, until their successors are duly
elected or appointed and qualified or until their earlier death, resignation or removal in accordance with the certificate of incorporation
and the bylaws of the Surviving Corporation and Applicable Law,(i) the directors of Merger Sub at the Effective Time shall be the
directors of the Surviving Corporation and (ii) the officers of Merger Sub at the Effective Time shall be the officers of the Surviving
Corporation. Prior to the Closing Date, the Company shall either remove (or cause the removal of) or use reasonable best efforts to procure
resignation letters (in a form and substance reasonably satisfactory to Parent) of each individual serving as a director of any Company
Subsidiary or member of any committee of a Subsidiary of the Company’s board of directors, in each case, solely in such individual’s
capacity as a director of any Subsidiary of the Company and member of any committee of a Subsidiary of the Company’s board of directors,
and in each case conditioned upon and effective as of the Closing, and shall deliver, or cause to be delivered, to Parent such procured
resignation letters (or evidence of such removal) at or prior to the Closing.
Article
4
Representations And Warranties Of The Company
Except
to the extent (a) disclosed in any Company SEC Document filed before the date of this Agreement (but excluding any forward-looking disclosures
set forth in any “risk factors” section or any disclosures in any “forward-looking statements” section; it being
understood that any factual information contained within such sections shall not be excluded) (it being understood that this clause (a)
shall not apply to Section 4.01, Section 4.02, Section 4.03, Section 4.05, Section 4.23, Section
4.24, Section 4.25 or Section 4.26); or (b) subject to Section 11.05, as set forth in the Company Disclosure
Schedule, the Company represents and warrants to Parent and Merger Sub that:
Section
4.01 Corporate Existence
and Power.
(a)
The Company (i) is a corporation, duly incorporated, validly existing and in good standing under the laws of the State of Delaware
and (ii) has all corporate powers required to carry on its business as now conducted and to own, lease or operate its properties and
assets, except in the case of this clause (ii) where the failure to have such power or authority has not had,
and would not reasonably
be expected to have, individually or in the aggregate, a Company Material Adverse Effect.
(b)
The Company is duly qualified to do business as a foreign corporation and is in good standing in each jurisdiction where the properties
or assets owned, operated or leased by it or the conduct of its business in such jurisdiction, as currently conducted, requires such
qualification, except for those jurisdictions where failure to be so qualified or in good standing has not had, and would not reasonably
be expected to have, individually or in the aggregate, a Company Material Adverse Effect. The Company has made available to Parent true,
complete and correct copies of the certificate of incorporation and bylaws of the Company in effect as of the date hereof. The Company
is not in violation of any of the provisions of its certificate of incorporation or bylaws.
Section
4.02 Corporate Authorization.
(a)
The execution, delivery and performance by the Company of this Agreement and the consummation by the Company of the transactions
contemplated hereby are within the Company’s corporate powers and, except for obtaining the Company Stockholder Approval and the
filing of the Certificate of Merger with the Secretary of State of the State of Delaware, no other corporate action not previously taken
on the part of the Company is necessary to authorize the execution and delivery by the Company of this Agreement, the performance by
the Company of its covenants and obligations hereunder and the consummation of the transactions contemplated hereby. The affirmative
vote of the holders of a majority of the outstanding Company Common Shares to vote at the Company Stockholders Meeting on the adoption
of this Agreement (the “Company Stockholder Approval”) is the only vote of the holders of any of the Company’s
capital stock required by Applicable Law or under the organizational documents of the Company or any of its Subsidiaries necessary to
consummate the transactions contemplated hereby (including the Merger). The Company has duly executed and delivered this Agreement, and,
assuming due authorization, execution and delivery by each of Parent and Merger Sub, this Agreement constitutes a valid and binding agreement
of the Company, enforceable against the Company in accordance with its terms (except insofar as such enforceability may be limited by
bankruptcy, insolvency, reorganization, moratorium or other Applicable Laws of general applicability relating to or affecting creditors’
rights, or by principles governing the availability of equitable remedies, whether at law or in equity (collectively, the “Enforceability
Exceptions”)).
(b)
At a meeting duly called and held, the Board of Directors has unanimously (i) determined that this Agreement and the transactions
contemplated hereby are fair to and in the best interests of the Company and the Company’s stockholders, and declared it advisable
to enter into this Agreement and consummate the transactions contemplated hereby upon the terms and subject to the conditions set forth
herein, (ii) approved the execution and delivery of this Agreement by the Company, the performance by the Company of its covenants and
other obligations hereunder, and the consummation of the transactions contemplated hereby upon the terms and conditions set forth herein,
(iii) resolved to recommend that the Company’s stockholders adopt this Agreement in accordance with the DGCL and (iv) directed
that the adoption of this Agreement be submitted for consideration by the Company’s stockholders at a meeting thereof (such recommendation,
the “Company Recommendation”).
Section
4.03 Governmental Authorization. The execution, delivery
and performance by the Company of this Agreement and the consummation by the Company of the transactions contemplated hereby require
no action by or in respect of, or filing by the Company with, any Governmental Authority, other than (a) compliance with any applicable
requirements of the HSR Act, (b) the filing with the SEC of such reports and other filings under, and compliance with any applicable
requirements of the 1933 Act, the 1934 Act and any other applicable securities laws (including filing, or causing to be filed, the Proxy
Statement and the clearance thereof by the SEC), (c) the filing of the Certificate of Merger with the Secretary of State of the State
of Delaware and appropriate documents with the relevant authorities of the other jurisdictions in which the Company is qualified to do
business, (d) compliance with the rules and regulations of the NYSE and (e) any other actions or filings (i) required solely by reason
of the participation of Parent or Merger Sub (as opposed to any Third Party) in the transactions contemplated hereby or (ii) the absence
of which has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect.
Section
4.04 Non-Contravention.
The execution, delivery and performance by the Company of this Agreement and, assuming compliance with the matters referred to in Section
4.03 and, in the case of the consummation of the transactions contemplated hereby, receipt of the Company Stockholder Approval, the
consummation of the transactions contemplated hereby do not and will not (a) contravene, conflict with, or result in any violation or
breach of any provision of the organizational documents of the Company, (b) contravene, conflict with or result in a violation or breach
of any provision of any Applicable Law, (c) require any consent or other action by any Person under, violate, conflict with, result in
breach of, constitute a default (or an event that, with notice or lapse of time or both, would become a default) under, or cause or permit
the termination, acceleration of performance or cancellation of any agreement binding upon the Company or any of its Subsidiaries or
(d) result in the creation or imposition of any Lien on any properties, rights or asset of the Company or any of its Subsidiaries, with
only such exceptions, in the case of each of clauses (b) through (d), as has not had, and would not reasonably be expected to have, individually
or in the aggregate, a Company Material Adverse Effect.
Section
4.05 Capitalization.
(a) The
authorized capital stock of the Company consists of 200,000,000 common shares, par value $0.01 per share (“Company Common
Shares”) and 10,000,000 preferred shares, par value $0.01 per share (“Company Preferred Shares”). As of
January 12, 2024 (such date, the “Company Capitalization Date”), there were outstanding (i) 58,320,743 Company Common Shares, including Company Restricted Shares covering an aggregate of 1,132,918 Company Common Shares
(assuming target performance with respect to any performance-based Company Restricted Shares), (ii) no Company Preferred Shares,
(iii) 21,725 Company Common Shares subject to outstanding Company RSUs, and (iv) 0 Company Common Shares subject to outstanding
purchase rights under the ESPP (assuming a purchase price based on the fair market value of a Company Common Share on the first day
of the offering period under such plan). All outstanding shares of capital stock of the Company have been, and all shares that may
be issued pursuant to the Company Stock Plan or the ESPP will be, when issued, duly authorized and validly issued, fully paid and
nonassessable and not subject to any preemptive rights. From the close of business on the Company Capitalization Date to the date of
this Agreement, the Company has not issued or granted any Company Securities, other than pursuant
to the vesting
and settlement of Company Restricted Shares or Company RSUs, in each case, which were granted prior to the date of this Agreement.
(b)
As of the date of this Agreement, there are no outstanding bonds, debentures, notes or other indebtedness of the Company having
the right to vote (or convertible into, or exchangeable for, securities having the right to vote) on any matters on which holders of
Company Common Shares may vote.
(c)
Except as set forth in this Section 4.05, as of the date hereof there are no issued, reserved for issuance or outstanding
(i) shares of capital stock or other voting securities (including any voting debt) of or ownership interests in the Company, (ii) securities
of the Company convertible into or exchangeable or exercisable for shares of capital stock or other voting securities (including any
voting debt) of or ownership interests in the Company, (iii) warrants, calls, options or other rights to acquire from the Company, or
other obligation of the Company to issue, any capital stock or other voting securities (including any voting debt) or ownership interests
in or any securities convertible into or exchangeable or exercisable for capital stock or other voting securities (including any voting
debt) or ownership interests in the Company or (iv) share options, restricted shares, restricted share units, share appreciation rights,
“phantom” equity, profits interests, contingent value rights, performance units or similar securities or rights issued by
the Company that are derivative of, or provide economic benefits based, directly or indirectly, on the value or price of, any capital
stock or voting securities (including any voting debt) or ownership interests of the Company (the items in clauses (i) through (iv) being
referred to collectively as the “Company Securities”).
(d)
There are no outstanding obligations of the Company or any of its Subsidiaries to issue, transfer, exchange, register, repurchase,
redeem or otherwise acquire or sell any of the Company Securities. There are no accrued and unpaid dividends with respect to any outstanding
shares of capital stock of the Company. There are no (i) voting trusts, proxies or similar agreements, arrangements or understandings
to which the Company or any of its Subsidiaries is a party or by which the Company or any of its Subsidiaries is bound with respect to
the voting of any shares of capital stock of, or other equity or voting interest in, the Company or any of its Subsidiaries or (ii) obligations
or binding commitments of any character to which the Company or any of its Subsidiaries is a party or by which it is bound (A) restricting
the transfer of any shares of capital stock of, or other equity or voting interest in, the Company or any of its Subsidiaries, (B) granting
any preemptive rights, anti-dilutive rights or rights of first refusal or other similar rights with respect to any Company Securities,
(C) relating to the voting, or requiring registration, of any Company Securities or (D) requiring the Company or any of its Subsidiaries
to make any payments based on the price or value of any Company Securities. None of (i) the shares of capital stock of the Company or
(ii) Company Securities are owned by any Subsidiary of the Company.
Section
4.06 Subsidiaries.
(a)
Each Subsidiary of the Company has been duly formed, is validly existing and (where applicable) in good standing under the laws
of its jurisdiction of organization and has all organizational powers required to carry on its business as now conducted and to own,
lease or operate its respective properties, rights and assets, except for any failure to be so formed, existing and in good standing
or any failure to have such power or authority as has not had, and would not
reasonably be expected
to have, individually or in the aggregate, a Company Material Adverse Effect. Each such Subsidiary is duly qualified to do business as
a foreign entity and (where applicable) is in good standing in each jurisdiction where the properties, or assets owned, operated or leased
by it or the conduct of its business in such jurisdiction, as currently conducted, requires such qualification, except for those jurisdictions
where failure to be so qualified or in good standing has not had, and would not reasonably be expected to have, individually or in the
aggregate, a Company Material Adverse Effect. All “significant subsidiaries” (as defined in Rule 1-02(w) of Regulation S-X
promulgated by the SEC) of the Company and their respective jurisdictions of organizations as of the date hereof are identified in the
Company’s annual report on Form 10-K for the fiscal year ended December 31, 2022. The Company has made available to Parent true,
complete and correct copies of the certificate of incorporation and bylaws or other organizational documents of each non-wholly owned
Subsidiary of the Company in effect as of the date hereof. None of the Subsidiaries of the Company is in violation of its organizational
documents.
(b)
All of the outstanding capital stock or other voting securities of, or ownership interests in, each Subsidiary of the Company
is owned by the Company, directly or indirectly, free and clear of any Liens (other than Permitted Liens). As of the date hereof, there
are no issued, reserved for issuance or outstanding (i) securities of the Company or any of its Subsidiaries convertible into, or exchangeable
or exercisable for, shares of capital stock or other voting securities of, or ownership interests in, any Subsidiary of the Company,
(ii) warrants, calls, options or other rights to acquire from the Company or any of its Subsidiaries, or other obligations of the Company
or any of its Subsidiaries to issue, any capital stock or other voting securities of, or ownership interests in, or any securities convertible
into, or exchangeable or exercisable for, any capital stock or other voting securities of, or ownership interests in, any Subsidiary
of the Company or (iii) share options, restricted shares, share appreciation rights, phantom equity, profits interests, performance units
or similar securities or rights issued by the Company or any of its Subsidiaries that are derivative of, or provide economic benefits
based, directly or indirectly, on the value or price of, any capital stock or other voting securities of, or ownership interests in,
any Subsidiary of the Company (the items in clauses (i) through (iii) being referred to collectively as the
“Company Subsidiary Securities”). There are no outstanding obligations of the Company or any of its Subsidiaries to
issue, transfer, exchange, register, repurchase, redeem or otherwise acquire or sell any of the Company Subsidiary Securities. Except
for the capital stock or other voting securities of or equity or ownership interests in its Subsidiaries, the Company does not own, directly
or indirectly, any capital stock or other voting securities or ownership interests of any Person. Section 4.06(b) of the Company
Disclosure Schedule sets forth a true, correct and complete list of the name, jurisdiction of organization and schedule of equityholders
of each of the Subsidiaries of the Company existing as of the date of this Agreement. Neither the Company nor its Subsidiaries has any
binding (whether written or oral) contract, subcontract, note, bond, mortgage, indenture, lease, license, sublicense, or other binding
agreement pursuant to which it is obligated to make any investment (in the form of a loan, capital contribution or otherwise) in any
Person (other than any Subsidiary of the Company).
Section
4.07 SEC Filings; Internal
Control.
(a)
Since January 1, 2022, the Company has filed with or furnished to the SEC on a timely basis all reports, schedules, forms, statements,
prospectuses, registration statements and other documents required to be filed with or furnished to the SEC by the Company pursuant
to Applicable Laws
(collectively, together with any exhibits and schedules thereto and other information incorporated therein, the “Company SEC
Documents”).
(b)
As of its filing or furnishing date, each Company SEC Document complied, and each Company SEC Document filed or furnished subsequent
to the date hereof will when so filed or furnished comply, as to form in all material respects with the applicable requirements of the
1933 Act and the 1934 Act, as the case may be.
(c)
As of its filing or furnishing date, each Company SEC Document did not, and each Company SEC Document filed or furnished subsequent
to the date hereof will not, contain any untrue statement of a material fact or omit to state any material fact necessary in order to
make the statements made therein, in the light of the circumstances under which they were made, not misleading.
(d)
The Company and each of its officers are in compliance in all material respects with the applicable provisions of the Sarbanes-Oxley
Act. Since January 1, 2022, the Company has, in material compliance with Rule 13a-15 under the 1934 Act, (i) designed, established and
maintained disclosure controls and procedures to ensure that material information relating to the Company, including its consolidated
Subsidiaries, is timely recorded and made known to the management, including the chief executive officer and chief financial officer,
of the Company by others within those entities and (ii) designed, established and maintained internal controls over financial reporting
(“Internal Controls”), as defined in Section 13a-15 under the 1934 Act, to provide reasonable assurance regarding
the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with GAAP. Since
January 1, 2022, neither the Company nor, to the Knowledge of the Company, the Company’s independent auditors has identified or
been made aware of significant deficiencies or material weaknesses in the design or operation of the Company’s Internal Controls
that are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial data and
have identified for the Company’s auditors any material weaknesses in Internal Controls. Since January 1, 2022, neither the Company
nor, to the Knowledge of the Company, the Company’s independent auditors have identified or been made aware of any fraud, whether
or not material, that involves management or other employees who have a significant role in the Company’s Internal Controls, including
management or other employees who have a role in the preparation of financial statements or the internal control over financial reporting
utilized by the Company and its Subsidiaries. Since January 1, 2022, there has been no material complaint, allegation, assertion or claim,
regarding deficiencies in the accounting or auditing practices, procedures, methodologies or methods of the Company or any of its Subsidiaries
or their respective Internal Controls. Since January 1, 2022, no attorney representing the Company or any of its Subsidiaries, whether
or not employed by the Company or any of its Subsidiaries, has reported evidence of a violation of securities laws, breach of fiduciary
duty or similar material violation by the Company or any of its officers, directors, employees or agents to the Company’s chief
legal officer, audit committee (or other committee designated for the purpose) of the Board of Directors or the Board of Directors pursuant
to the rules adopted pursuant to Section 307 of the Sarbanes-Oxley Act or any Company policy contemplating such reporting, including
in instances not required by those rules.
(e)
As of the date hereof, none of the Company SEC Documents is the subject of any unresolved or outstanding SEC comment or, to the
Knowledge of the Company, the subject of ongoing SEC review.
(f)
The Company is in compliance in all material respects with the applicable listing and corporate governance rules and regulations
of NYSE.
(g)
Except as permitted under the 1934 Act and disclosed in the Company SEC Documents, neither the Company nor any of its Affiliates
has made, arranged or modified any extensions of credit in the form of a personal loan to any executive officer of the Company or member
of the Board of Directors.
(h)
No Subsidiary of the Company is required to file, or files, any reports, schedules, forms, statements, prospectuses, registration
statements or other documents with the SEC.
Section
4.08 Financial Statements.
The audited consolidated financial statements (including any related notes and schedules) and unaudited consolidated interim financial
statements (including any related notes and schedules) of the Company included or incorporated by reference in the Company SEC Documents
(a) were prepared in accordance with GAAP (except as may be indicated in the notes thereto or as otherwise permitted by Form 10-Q with
respect to any financial statements filed on Form 10-Q) and (b) fairly present in all material respects, in conformity with GAAP applied
on a consistent basis throughout the periods covered thereby (except as may be indicated in the notes thereto), the consolidated financial
position of the Company and its consolidated Subsidiaries as of the dates thereof and their consolidated results of operations and cash
flows for the periods then ended (subject to, in the case of any unaudited consolidated interim financial statements, normal year-end
audit adjustments and the absence of footnotes). There are no unconsolidated Subsidiaries of the Company or any off-balance sheet arrangements
(and neither the Company nor any Subsidiary of the Company has any commitment to become a party to any off-balance sheet arrangement)
of the type required to be disclosed pursuant to Item 303(a)(4) of Regulation S-K promulgated by the SEC.
Section
4.09 Disclosure Documents.
The Proxy Statement will, with respect to information regarding the Company, when filed, comply as to form in all material respects with
the applicable requirements of the 1934 Act. None of the information supplied or to be supplied by or on behalf of the Company specifically
for inclusion or incorporation by reference in the Proxy Statement will, at the date it (and any amendments or supplements thereto) is
first mailed to the stockholders of the Company and at the time of the Company Stockholders Meeting, contain any untrue statement of
a material fact or omit to state any material fact required to be stated therein or necessary in order to make the statements therein,
in light of the circumstances under which they were made, not misleading, except that no representation or warranty is made by the Company
with respect to statements made or incorporated by reference therein based on information supplied by Parent or Merger Sub or any of
their respective Representatives in writing specifically for use or incorporation by reference therein.
Section
4.10 Absence of Certain
Changes. Since December 31, 2022 (the “Balance Sheet Date”) through the date of this Agreement, (a) the business
of the Company and its
Subsidiaries has
been conducted in the ordinary course in all material respects and (b) there has not been any Effect that has had or would reasonably
be expected to have, individually or in the aggregate, a Company Material Adverse Effect. Since the Balance Sheet Date through the date
of this Agreement, there has not been any action taken by the Company or any of its Subsidiaries that, if taken during the period from
the date of this Agreement through the Effective Time without Parent’s consent, would constitute a material breach of clauses (c),
(d), (e), (f), (g), (j), (l), (m), (n), (o) or (p) of Section 6.01.
Section
4.11 No Undisclosed Material
Liabilities. There are no liabilities or obligations of the Company or any of its Subsidiaries of any kind whatsoever, whether accrued,
contingent, absolute, determined, determinable or otherwise, other than: (a) liabilities or obligations to the extent disclosed and provided
for in the Company Balance Sheet (or notes thereto); (b) liabilities or obligations to the extent incurred in the ordinary course of
business since the Balance Sheet Date; (c) liabilities or obligations incurred in connection with the transactions contemplated hereby;
and (d) liabilities or obligations which has not had, and would not reasonably be expected to have, individually or in the aggregate,
a Company Material Adverse Effect.
Section
4.12 Compliance with Laws;
Permits.
(a)
Except as has not been, and would not reasonably be expected to be, material to the Company and its Subsidiaries, taken as a whole,
(i) the Company and each of its Subsidiaries are, and since January 1, 2022 have been, in compliance with all Applicable Laws and (ii)
neither the Company nor any of its Subsidiaries nor any of their respective assets is, to the Knowledge of the Company, under investigation
with respect to or has been threatened to be charged with or given notice of, nor has any Governmental Authority notified the Company
or any of its Subsidiaries in writing of its intent to conduct an investigation of, any violation of any Applicable Law, except for such
investigations or charges which has not been, and would not reasonably be expected to be, material to the Company and its Subsidiaries,
taken as a whole.
(b)
Except as has not been, and would not reasonably be expected to be, individually or in the aggregate, material to the Company
and its Subsidiaries, taken as a whole, since January 1, 2022, (i) the Company and its Subsidiaries are in possession of, and in compliance
with, all Permits necessary for those entities for the ownership and operation of their respective businesses as now being conducted,
under and pursuant to Applicable Laws, (ii) all such Permits are in full force and effect and (iii) no suspension, cancellation, withdrawal
or revocation thereof is pending or threatened.
(c)
The Company and its directors, officers and each of its Subsidiaries, and, to the Knowledge of the Company, the directors and
officers of each such Subsidiary and the respective employees, consultants and agents of the Company and its Subsidiaries (in each case,
to the extent acting for or on behalf of the Company or any of its Subsidiaries), are and for the past five (5) years have been in compliance
with Anti-Corruption Laws in all material respects and have not (i) used any corporate funds for unlawful contributions, gifts, entertainment
or other expenses related to political activity; (ii) made any unlawful payments to any government officials; or (iii) otherwise made
any unlawful bribe, rebate, payoff, influence payment, kickback or similar payment in violation of any applicable Anti-Corruption Law.
The Company and each of its
Subsidiaries have
adopted, maintained, and adhered to compliance policies and procedures and a system of internal controls reasonably designed to ensure
compliance with Anti-Corruption Laws.
(d)
None of the Company, its directors, officers or any of its Subsidiaries, or, to the Knowledge of the Company, the directors or
officers of any such Subsidiary or the respective employees, consultants and agents of the Company or its Subsidiaries (in each case,
to the extent acting for or on behalf of the Company or any of its Subsidiaries): is or has been for the past five (5) years (i) a Sanctioned
Person; (ii) transacted business with or for the benefit of any Sanctioned Person or otherwise violated Sanctions; or (iii) violated
any Ex-Im Law.
(e)
Neither the Company nor any of its Subsidiaries has been for the past five (5) years the subject of any allegation or enforcement
proceeding, nor to the Knowledge of the Company, any inquiry or investigation, regarding any possible violation of applicable Anti-Corruption
Laws, Ex-Im Laws or Sanctions.
(f)
As of the date hereof, neither the Company nor any of its Subsidiaries has applied for and obtained any benefit, loan, right or
amount under the CARES Act or any other Applicable Law intended to address COVID-19 that would reasonably be expected to result in material
restrictions on the business of the Company and its Subsidiaries.
Section
4.13 Litigation. There
is, and since January 1, 2022 has been, no (a) Proceeding pending, or, to the Knowledge of the Company, threatened, against the Company
or any of its Subsidiaries or any officer, director or employee of the Company or any of its Subsidiaries in such capacity before any
Governmental Authority or (b) Order outstanding against the Company or any of its Subsidiaries, in each case, except as has not been,
and would not reasonably be expected to be, material to the Company and its Subsidiaries, taken as a whole. As of the date hereof, there
is no Proceeding pending, or, to the Knowledge of the Company, threatened, against the Company and there is no Order outstanding that
in any manner seeks to prevent, enjoin or materially delay the Company’s ability to consummate the Merger or any of the other transactions
contemplated hereby.
Section
4.14 Properties.
(a)
Except as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse
Effect, the Company and its Subsidiaries have good title to, or valid leasehold interests in, all property and assets reflected on the
Company Balance Sheet or acquired after the Balance Sheet Date, except as have been disposed of since the Balance Sheet Date in the ordinary
course of business.
(b)
Section 4.14(b) of the Company Disclosure Schedule sets forth a true, correct and complete (in all material respects) list
of all real property and interests in real property owned in fee simple by the Company or any of its Subsidiaries. Except as had not
had, and would not reasonably be expected to have, a Company Material Adverse Effect, the Company and its Subsidiaries have good, valid
and marketable title, in fee or valid leasehold, easement or other rights, in each case, free and clear of all Liens other than Permitted
Liens, to the land, buildings, structures and other improvements thereon and fixtures thereto necessary to permit the Company and its
Subsidiaries to conduct their business as currently conducted.
(c)
Section 4.14(c) of the Company Disclosure Schedule sets forth a true, correct and complete (in all material respects) list
as of the date of this Agreement of all leases, licenses, subleases and occupancy agreements of real property to which the Company or
any of its Subsidiaries is a party (each, a “Lease”). Except as has not had, and would not reasonably be expected
to have, individually or in the aggregate, a Company Material Adverse Effect, (i) each Lease under which the Company or any of its Subsidiaries
leases, subleases or licenses any real property is valid and in full force and effect and no event has occurred that, with notice, lapse
of time or both, would constitute a material default by the Company or any of its Subsidiaries or, to the Company’s Knowledge,
any other party under any Lease and (ii) neither the Company nor any of its Subsidiaries, nor to the Company’s Knowledge any other
party to a Lease, is in violation of any provision of any Lease or is in default under any Lease.
Section
4.15 Intellectual Property.
(a)
Except as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse
Effect: (i) the conduct of the business of the Company and its Subsidiaries as currently conducted does not currently infringe on, misappropriate
or otherwise violate, and since January 1, 2018, the conduct of the Business and its Subsidiaries has not infringed on, misappropriated
or otherwise violated, the Intellectual Property rights of any Person, and(ii) there is no claim or Proceeding pending or, to the Company’s
Knowledge, threatened, against the Company or any of its Subsidiaries alleging any of the foregoing.
(b)
Except as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse
Effect: (i) to the Knowledge of the Company, no Person is infringing, misappropriating or otherwise violating, or since January 1, 2022
has infringed, misappropriated or otherwise violated the Company-Owned Intellectual Property, and neither the Company nor any of its
Subsidiaries have sent written notice or initiated any Proceeding alleging the same; and (ii) no Company-Owned Intellectual Property
is subject to any outstanding judgment, injunction, Order or decree restricting the use thereof by the Company or its Subsidiaries.
(c)
Section 4.15(c) of the Company Disclosure Schedule sets forth a true and complete list, as of the date hereof, of all registrations
and applications for registration for Company-Owned Intellectual Property (the “Company Registered Intellectual Property”).
Except as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect:
(i) none of the Company Registered Intellectual Property has been adjudged invalid or unenforceable in whole or in part; and (ii) there
is no, and has not since January 1, 2022 been any, pending or, to the Company’s Knowledge, threatened Proceeding (A) challenging
or contesting the ownership, validity, registrability, scope or enforceability of any Company-Owned Intellectual Property or (B) brought
by the Company or one of its Subsidiaries and challenging or contesting the ownership, validity, registrability, scope or enforceability
of any Intellectual Property rights of any other Person.
(d)
Except as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse
Effect: (i) either the Company or one of its Subsidiaries exclusively owns all right, title and interest in and to the Company-Owned
Intellectual Property;
(ii) the Company and its Subsidiaries have valid rights to use all other Intellectual Property necessary for the conduct of the business
of the Company and its Subsidiaries as currently conducted, in each case of clause (i) and clause (ii), free and clear of any Liens (other
than Permitted Liens); and (iii) the transactions contemplated hereby will not (A) impair any such ownership or rights or (B) pursuant
to any Contract to which the Company or its Subsidiaries are a party, result in Parent or any of its Affiliates granting any right to
any Intellectual Property owned by, or licensed to, any of them.
(e)
Except as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse
Effect, the Company and its Subsidiaries have taken and currently take reasonable steps in accordance with generally accepted industry
practice to protect, defend and enforce all Company-Owned Intellectual Property and to maintain the confidentiality of all trade secrets
held by the Company.
(f)
The Company and its Subsidiaries are in material compliance with, and since January 1, 2022 have materially complied with, all
applicable Data Security Requirements and neither the Company nor any of its Subsidiaries has received any notice from any Governmental
Authority alleging any violation thereof. Except as has not had, and would not reasonably be expected to have, individually or in the
aggregate, a Company Material Adverse Effect, to the Company’s Knowledge, since January 1, 2022, (i) the Company and its Subsidiaries
have not experienced any incident in which confidential, proprietary or sensitive information, payment card data, personally identifiable
information, or other protected information relating to individuals was or may have been stolen, misused, misappropriated or improperly
accessed, including any breach of security, and (ii) there have been no disruptions, failures of, or unauthorized access to or unauthorized
use of the information technology systems owned or controlled by the Company and its Subsidiaries (the “Company IT Systems”)
and the Company and its Subsidiaries have not sent or received any written notices or written complaints from any Person with respect
to either of the foregoing clauses (i) and (ii).
(g)
Except as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse
Effect, (i) the Company IT Systems are sufficient for the conduct of the business of the Company and its Subsidiaries as currently conducted
and (ii) the Company and its Subsidiaries have used and currently use commercially reasonable efforts consistent with generally accepted
industry practice to protect the confidentiality, integrity and security of the Company IT Systems from any unauthorized use, access,
interruption, or modification.
Section
4.16 Taxes. Except as
has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect:
(a)
All Tax Returns required by Applicable Law to be filed with any Taxing Authority by, or on behalf of, the Company or any of its
Subsidiaries have been filed when due in accordance with all Applicable Law (taking into account all extensions), and all such Tax Returns
are true, correct and complete.
(b)
The Company and each of its Subsidiaries has paid (or has had paid on its behalf) or has withheld and remitted to the appropriate
Taxing Authority all Taxes due and payable.
(c)
There is no Proceeding pending or, to the Company’s Knowledge, threatened against or with respect to the Company or its
Subsidiaries in respect of any Tax.
(d)
There are no Liens on any of the assets of the Company or any of its Subsidiaries that arose in connection with any failure (or
alleged failure) to pay any Tax, other than Permitted Liens.
(e)
Neither the Company nor any of its Subsidiaries (i) has been a member of an affiliated, combined, consolidated, unitary or other
group for Tax purposes (other than any such group the common parent of which is or was the Company or any of its Subsidiaries), (ii)
has any liability for the Taxes of any Person (other than the Company or its Subsidiaries) under Treasury Regulations Section 1.1502-6
or any similar provision of state, local or foreign Applicable Law or as a successor or transferee, (iii) is a party to or bound by any
Tax sharing agreement, Tax allocation agreement or Tax indemnity agreement or other similar arrangement (other than (i) any commercial
agreements not primarily related to Tax or (ii) any agreements among or between only the Company or any of its Subsidiaries) or (iv)
has been either a “distributing corporation” or a “controlled corporation” in a transaction intended to be governed
(in whole or in part) by Section 355 (or so much of Section 356 as relates to Section 355) of the Code in the two-year period ending
on the date of this Agreement. Neither the Company nor any Company Subsidiary has any liability to make any payment pursuant to Section
965 of the Code.
(f)
Neither the Company nor any of its Subsidiaries has participated in any “listed transactions” within the meaning of
Treasury Regulations Section 1.6011-4.
Section
4.17 Employee Benefit Plans.
(a)
Section 4.17(a) of the Company Disclosure Schedule contains, as of the date hereof, a list of all material Company Plans.
For each such Company Plan, the Company has made available to Parent a copy of such Company Plan and all amendments thereto (or a written
summary in the case of an unwritten plan) and, to the extent applicable: (i) the most recently filed Form 5500 annual report (with applicable
schedules and attachments thereto); (ii) the most recent favorable determination or opinion letter from the Internal Revenue Service
(“IRS”); and (iii) any material non-routine communication with any Governmental Authority since January 1, 2022.
(b)
Each Company Plan has been established and administered in compliance with its terms and Applicable Law, except as has not had,
and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect. Each Company Plan
intended to be “qualified” under Section 401(a) of the Code has received a favorable determination or opinion letter from
the IRS or has applied to the IRS for such a letter within the applicable remedial amendment period.
(c)
Neither the execution of this Agreement nor the consummation of the transactions contemplated hereby would, either alone or in
conjunction with any other event, (i) other than with respect to the treatment of Company Restricted Shares, Company RSUs and any rights
under the ESPP in accordance with Section 2.05, entitle any Company Service Provider to any payment or benefit (including the
forgiveness of any indebtedness), or accelerate the time of payment, funding or vesting, or otherwise increase the amount of, compensation
due or payable or
the level of benefits
to be provided to any Company Service Provider under any Company Plan or otherwise, (ii) result in any breach or violation of, default
under or limit the Company’s right to amend, modify or terminate any Company Plan, (iii) directly or indirectly cause the Company
to transfer or set aside any assets to fund any benefits under any Company Plan or (iv) result in any Company Service Provider receiving
any “excess parachute payment” (within the meaning of Section 280G of the Code) from the Company or its Subsidiaries (excluding
the impact of any compensation arrangements established, adopted, entered into or modified following the Effective Time).
(d)
No Company Plan requires any gross up or contains any other obligation to reimburse any Company Service Provider for any Taxes
imposed under Section 4999 or 409A of the Code or otherwise.
(e)
Neither the Company nor any of its Subsidiaries sponsors, maintains, contributes to or has in the past six (6) years sponsored,
maintained, contributed to, or is required to contribute to, or has or is reasonably expected to have any material unsatisfied liability
with respect to (including as a consequence of at any time being considered a single employer under Section 414 of the Code with any
other Person), any plan that is (i) a “defined benefit plan” as defined in Section 3(35) of ERISA or any other plan subject
to Title IV of ERISA or Section 412 of the Code; (ii) a “multiemployer” plan as defined in Section 3(37) of ERISA (a “Multiemployer
Plan”); (iii) a “multiple employer plan” (within the meaning of Section 210 of ERISA or Section 413(c) of the Code);
or (iv) a “multiple employer welfare arrangement” (as defined in Section 3(4) of ERISA). No Company Plan provides health
or other welfare benefits to retirees or other former employees or service providers of the Company or its Affiliates other than health
continuation coverage pursuant to Part 6 of Subtitle B of Title I of ERISA, Section 4980B of the Code and any similar state Law. Except
as has not been, and would not reasonably be expected to be, material to the Company and its Subsidiaries, taken as a whole, all contributions
required to be made to any Company Plan by Applicable Law or otherwise, and all premiums due or payable with respect to insurance policies
funding any Company Plan, have been timely made or paid in full or, to the extent not required to be made or paid on or before the date
hereof, have been fully reflected on the financial statements of the Company in accordance with GAAP.
(f)
Except as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse
Effect, no Proceeding (other than routine claims for benefits) is pending against or with respect to or, to the Knowledge of the Company,
is threatened against or with respect to, any Company Plan.
Section
4.18 Employee and Labor
Matters.
(a)
Neither the Company nor any of its Subsidiaries is a party to, bound by, or subject to any collective bargaining agreement or
other contract with any labor union or other labor organization (each, a “CBA”). No Company Service Providers are
represented by any labor union or other labor organization with respect to their employment with the Company or any of its Subsidiaries.
Since January 1, 2022, no labor union, other labor organization, or group of Company Service Providers has made a written demand to the
Company for recognition or certification. To the Knowledge of the Company, since January 1, 2022, there have been no material labor organizing
activities with respect to any Company Service Providers. Except as has not had, and
would not reasonably
be expected to have, individually or in the aggregate, a Company Material Adverse Effect, since January 1, 2022, there has been no unfair
labor practice charges, labor grievances, employment-related Proceedings, labor arbitrations, strikes, lockouts, work stoppages, slowdowns,
picketing, hand billing or other labor disputes against or affecting the Company or its Subsidiaries.
(b)
Except as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse
Effect, the Company and its Subsidiaries are, and since January 1, 2022 have been, in compliance with all Applicable Laws respecting
labor, employment and employment practices, including terms and conditions of employment, wages and hours, employment discrimination,
employee classification, workers’ compensation, family and medical leave, immigration and occupational safety and health requirements.
(c)
As of the date hereof, the Company has not implemented or publicly announced any employee layoff, facility closure or shutdown
(whether voluntary or as required by Applicable Law), reduction-in-force or furlough affecting Company Service Providers within the past
five (5) months.
(d)
There have been no sexual harassment, discrimination or retaliation allegations made since January 1, 2022 involving any executive
officer of the Company or member of the Board of Directors. The Company or its applicable Subsidiary has investigated any sexual harassment,
discrimination or retaliation allegation made by any Company Service Provider since January 1, 2022 of which the Company has Knowledge.
With respect to any such allegation with merit, the Company or its applicable Subsidiary has taken corrective action reasonably calculated
to prevent continuation or recurrence of the alleged violation.
Section
4.19 Environmental Matters.
Except as has not been, and would not reasonably be expected to be, material to the Company and its Subsidiaries, taken as a whole:
(a)
no written notice, order, complaint or penalty has been received by the Company or any of its Subsidiaries arising out of any
Environmental Laws that is currently pending, and there are no judicial, administrative or other Proceedings pending or, to the Company’s
Knowledge, threatened which allege a violation by, or liability of, the Company or any of its Subsidiaries under any Environmental Laws,
and there is no administrative or judicial Order of any Governmental Authority pursuant to any Environmental Laws outstanding against
the Company or any of its Subsidiaries;
(b)
the Company and each of its Subsidiaries have all Permits necessary for their operations to comply with all applicable Environmental
Laws and are in compliance with the terms of such Permits;
(c)
the operations of the Company and each of its Subsidiaries are in compliance with all applicable Environmental Laws;
(d)
neither the Company nor any of its Subsidiaries, nor, to the Knowledge of the Company, any other Person to the extent giving rise
to liability for the Company or any of its
Subsidiaries has
released or disposed of any Hazardous Substance on or under real property currently or, to the Knowledge of the Company, formerly owned,
leased or operated by the Company or any of its Subsidiaries, or, to the Knowledge of the Company, any other location where Hazardous
Substances generated by the Company or any of its Subsidiaries have been disposed, in quantities or concentrations that require investigation,
remediation or monitoring by the Company or any of its Subsidiaries pursuant to any Environmental Law;
(e)
neither the Company nor any of its Subsidiaries has assumed, undertaken or agreed to provide indemnification for, as a result
of any contract, any material liability of any other Person arising under Environmental Laws; and
(f)
the Company has delivered or otherwise made available for inspection to Parent true, complete and correct copies of any material
reports, investigations, audits, assessments (including Phase I environmental site assessments and Phase II environmental site assessments),
studies, analyses, tests or monitoring in the possession of the Company or any of its Subsidiaries pertaining to: (i) any unresolved
liabilities of the Company or any of its Subsidiaries under Environmental Law; (ii) any releases or disposal of Hazardous Substances
by the Company or any of its Subsidiaries or to the extent giving rise to liability for the Company or any of its Subsidiaries in, on,
or beneath any property currently or formerly owned, operated or leased by the Company or any of its Subsidiaries; or (iii) the Company’s
or any of its Subsidiaries’ noncompliance with applicable Environmental Laws, in each case to the extent prepared since January
1, 2020.
Section
4.20 Material Contracts.
(a)
Section 4.20(a) of the Company Disclosure Schedule contains an accurate and complete list of each contract described below
in this Section 4.20(a) (other than a Company Plan or, only for purposes of Section 4.20(a)(i), Section 4.20(a)(ii)
and Section 4.20(a)(iii), purchase orders or invoices entered into in the ordinary course of business substantially consistent
with the form listed in Section 4.20(a)(i) or Section 4.20(a)(ii) of the Company Disclosure Schedule) to which the Company or any of
its Subsidiaries is a party as of the date hereof (together with any contract of the type described in clauses (i) through (xvi) of this
Section 4.20(a) entered into after the date of this Agreement and prior to the Closing Date) (each contract of a type described
in this Section 4.20(a), a “Material Contract”):
(i)
any contract with a top twenty (20) customer (determined on the basis of the aggregate revenues recognized by the Company and
its Subsidiaries during calendar year 2023);
(ii)
any contract with a top twenty (20) vendor or supplier of goods, services or other assets (including supply of raw materials,
pulp, aluminum, glass and/or wood) (determined on the basis of the aggregate dollar volume of purchases made by the Company and its Subsidiaries
during calendar year 2023);
(iii)
any contract that is not a lease for real property and that both (A) requires or is reasonably likely to require the payment or
delivery of cash or other consideration by or to the Company or any of its Subsidiaries after the date hereof in an amount having an
expected value in excess of $3,000,000 and (B) cannot be cancelled by the Company or any of its
Subsidiaries without
penalty or further payment (other than liabilities incurred prior to the time of termination) without more than ninety (90) days’
notice;
(iv)
any contract relating to the acquisition or disposition of any material securities, assets or businesses or exclusive licensing
agreement (whether by merger, purchase of stock, purchase of assets or otherwise) that contains any material outstanding non-competition,
earn-out or other contingent payment obligations of the Company or any of its Subsidiaries that would reasonably be expected to result
in the Company’s or any of its Subsidiaries’ receipt or making of future payments in excess of $2,000,000;
(v)
any contract involving the licensing of or other grant of rights in Intellectual Property (excluding, in each case, (A) licenses
for unmodified, commercial off the shelf computer software that are generally available on nondiscriminatory pricing terms with an aggregate
annual license fee of less than $500,000 and (B) non-exclusive licenses granted by the Company or any of its Subsidiaries in the ordinary
course of business);
(vi)
any contract under which the Company or any of its Subsidiaries (A) is lessee of, or holds or operates, any personal property
owned by any other Person, for which the annual rent exceeds $2,000,000 and (B) cannot cancel without penalty or further payment (other
than liabilities incurred prior to the time of termination) without more than ninety (90) days’ notice;
(vii)
any contract that expressly prohibits the payment of dividends or distributions in respect of the capital stock or voting or equity
securities of the Company or any of its Subsidiaries, or prohibits the pledging of the capital stock or voting or equity securities or
other equity interests of the Company or any of its Subsidiaries or the issuance of any guaranty by the Company or any of its Subsidiaries;
(viii)
any contract with any Affiliate, director, executive officer (as such term is defined in the 1934 Act), holder of five percent
(5%) or more of the shares of capital stock of the Company or, to the Knowledge of the Company, any of their respective Affiliates (other
than the Company or its Subsidiaries) or immediate family members (other than any indemnity under the certificate of incorporation and
bylaws or other organizational documents of the Company and its Subsidiaries) that is required to be disclosed pursuant to Item 404 of
Regulation S-K promulgated by the SEC in the Form 10-K or proxy statement pertaining to an annual meeting of stockholders;
(ix)
any contract that (A) limits in any material respect the freedom of the Company or any of its Subsidiaries to compete in any line
of business or geographic region, or offer or sell any products, assets or services, with or to any Person, or (B) expressly contains
any material “most favored nation” provision, exclusive dealing or marketing arrangement or arrangement that grants any right
of first refusal, first offer, first negotiation or similar preferential right to any other Person;
(x)
any partnership, joint venture, joint development, strategic alliance or other similar contract;
(xi)
any contract relating to outstanding indebtedness of the Company or the Subsidiaries of the Company, including any indenture,
loan or credit agreement, or indebtedness in connection with any settlement facilities or lines of credit or any financial guaranty or
credit support, indemnification, assumption or endorsement thereof (in each case whether incurred, assumed, guaranteed or secured by
any asset), in each case, in the principal amount of $2,000,000 or more (including any related security or pledge agreements), other
than contracts among the Company and its wholly owned Subsidiaries;
(xii)
any contract requiring contributions of capital, capital expenditures or the acquisition or construction of fixed assets in excess
of $3,000,000 in the next twelve (12) months (excluding contributions made to the Company by its Subsidiaries);
(xiii)
any CBAs;
(xiv)
any contract providing for the settlement of any Proceeding asserted by any Person (including a Governmental Authority) (A) involving
payment by the Company or any of its Subsidiaries in excess of $1,000,000 or (B) that imposes continuing requirements, obligations, liabilities
or restrictions that are material to the Company and its Subsidiaries, taken as a whole;
(xv)
any other contract, arrangement, commitment or understanding that is a “material contract” (as such term is defined
in Item 601(b)(10)) of Regulation S-K; and
(xvi)
any other contract that commits the Company or any of its Subsidiaries to enter into any contracts of the types described in foregoing
clauses (i) through (xv).
(b)
The Company has made available to Parent an accurate and complete copy of each Material Contract (including any applicable amendments,
modifications or material waivers) as in effect as of the date hereof. Except for breaches, violations or defaults which has not had,
and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect, as of the date hereof,
(i) each Material Contract is valid and in full force and effect and (ii) neither the Company nor any of its Subsidiaries, nor to the
Company’s Knowledge any other party to a Material Contract, is in breach or default of any provision of, or taken or failed to
take any act which, with or without notice, lapse of time or both, would constitute a default under the provisions of such Material Contract,
and, except as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse
Effect, neither the Company nor any of its Subsidiaries has received written notice that it has breached, violated or defaulted under
any Material Contract.
Section
4.21 Insurance. Except
as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse Effect, (i)
the Company and its Subsidiaries maintain insurance in such amounts and against such risks and with such carriers as the Company reasonably
has determined to be prudent, taking into account the industries in which the Company and its Subsidiaries operate and as is sufficient
to comply with Applicable Law, (ii) all insurance policies of the Company and its Subsidiaries are in full force and effect, except for
any expiration thereof in accordance with the terms thereof and the limits and sub limits of such policies have not been exhausted or
materially diminished, (iii) all premiums payable under
all such policies
have been timely paid, the Company and its Subsidiaries are in compliance with all other terms and conditions (including any notification
requirements) of all such policies and neither the Company nor any of its Subsidiaries is in breach of, or default under, any such insurance
policy and (iv) no written notice of cancellation or termination or premium increase has been received with respect to any such insurance
policy.
Section
4.22 Products.
(a)
Except as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse
Effect, the products designed, produced or distributed by the Company do not suffer from any defects that give rise to or would reasonably
be likely to give rise to any product liability or warranty claims.
(b)
Except as has not had, and would not reasonably be expected to have, individually or in the aggregate, a Company Material Adverse
Effect, since January 1, 2022, (i) no product designed, produced or distributed by the Company has been the subject of any recall or
warranty claim, (ii) the Company has not received any written notice alleging material defects in any such product and (iii) to the Company’s
Knowledge, none of its customers have terminated or threatened in writing to terminate the distribution or sale of any such product based
on any such defects or recalled, or issued a product warning with respect to, any such product.
Section
4.23 Finders’ Fees.
Except for fees (including a good faith estimate of the amounts due and payable assuming the Closing occurs) set forth on Section
4.23 of the Company Disclosure Schedule, there is no investment banker, financial advisor, broker, finder or other intermediary that
has been retained by or is authorized to act on behalf of the Company or any of its Subsidiaries who might be entitled to any fee or
commission from the Company or any of its Affiliates in connection with the transactions contemplated by this Agreement.
Section
4.24 Opinion of Financial
Advisor. The Company has received the opinion of Evercore, financial advisor to the Company, to the effect that, as of the date of
such opinion, and based upon and subject to the qualifications, assumptions and limitations set forth therein, the Merger Consideration
is fair to the Company’s stockholders from a financial point of view. The Company shall have provided to Parent a copy of such
written opinion promptly following the execution and delivery of this Agreement.
Section
4.25 Antitakeover Statutes;
Rights Agreement. The Company has taken all necessary actions so that the restrictions on business combinations set forth in Section
203 of the DGCL and any other similar applicable “anti-takeover” law will not be applicable to the Merger. The Company has
taken all action necessary to (i) render the Rights (as defined in the Rights Agreement) inapplicable to the Merger and the other transactions
contemplated by this Agreement and (ii) ensure that (A) none of Parent, Merger Sub or any of their respective Affiliates will become
an Acquiring Person (as defined in the Rights Agreement) as a result of the transactions contemplated hereby and (B) neither a Distribution
Date nor a Stock Acquisition Date (each as defined in the Rights Agreement) shall occur by reason of the approval or execution of this
Agreement, the announcement or consummation of the Merger or the announcement or consummation of any of the other transactions contemplated
by this Agreement.
Section
4.26 Masonite Agreement. Assuming Parent’s compliance
with Section 8.10, concurrently with the execution of this Agreement, the Masonite Agreement was terminated by the Company in
accordance with its terms. There have not been any amendments or modifications to the Masonite Agreement prior to its termination. As
of the date of this Agreement, the Company has not received notice of any breach of the Masonite Agreement.
Section
4.27 Acknowledgement of
No Other Representations and Warranties. Except for the representations and warranties set forth in Article 5, in any certificate
delivered pursuant to this Agreement, the Company acknowledges and agrees that no representation or warranty of any kind whatsoever,
express or implied, at law or in equity, is made or shall be deemed to have been made by or on behalf of Parent or Merger Sub to the
Company, and the Company hereby disclaims reliance on any such other representation or warranty, whether by or on behalf of Parent or
Merger Sub, and notwithstanding the delivery or disclosure to the Company, or any of its Representatives or Affiliates, of any documentation
or other information by Parent, Merger Sub or any of their respective Representatives or Affiliates with respect to any one or more of
the foregoing.
Article
5
Representations And Warranties Of Parent And Merger Sub
Subject
to Section 11.05, except to the extent set forth in the Parent Disclosure Schedule, Parent represents and warrants to the Company
that:
Section
5.01 Corporate Existence
and Power. Each of Parent and Merger Sub (x) is a limited liability company or corporation, as applicable, duly formed or incorporated,
as applicable, validly existing and in good standing under the laws of its jurisdiction of formation or incorporation and (y) has all
limited liability company or corporate powers required to carry on its business as now conducted, except in the case of this clause (y)
where the failure to have such power or authority has not had, and would not reasonably be expected to have, individually or in the aggregate,
a Parent Material Adverse Effect. Since the date of its incorporation, Merger Sub has not engaged in any activities other than in connection
with or as contemplated by this Agreement. Merger Sub was incorporated solely for the purpose of consummating the transactions contemplated
by this Agreement. All of the outstanding shares of capital stock of Merger Sub have been validly issued, are fully paid and nonassessable
and are indirectly owned by, and at the Effective Time will be indirectly owned by, Parent, free and clear of all Liens, excluding restrictions
on transfer arising under applicable securities laws.
Section
5.02 Corporate Authorization.
The execution, delivery and performance by each of Parent and Merger Sub of this Agreement and the consummation by Parent and Merger
Sub of the transactions contemplated hereby are within the limited liability company or corporate, as applicable, powers of each of Parent
and Merger Sub and have been duly authorized by all necessary limited liability company or corporate, as applicable, action on the part
of each of Parent and Merger Sub, and no vote of the members of Parent is necessary to authorize the execution, delivery or performance
of this Agreement. Each of Parent and Merger Sub has duly executed and delivered this Agreement, and, assuming due authorization, execution
and delivery by the Company, this Agreement constitutes a valid and binding agreement of each of Parent and Merger Sub, enforceable against
each of Parent and Merger Sub in accordance with its terms (except insofar as such enforceability may be limited by the Enforceability
Exceptions).
Section
5.03 Governmental Authorization. The execution, delivery
and performance by each of Parent and Merger Sub of this Agreement and the consummation by each of Parent and Merger Sub of the transactions
contemplated hereby require no action by or in respect of, or filing by Parent or Merger Sub with, any Governmental Authority, other
than (a) compliance with any applicable requirements of the HSR Act, (b) compliance with any applicable requirements of the 1933 Act,
the 1934 Act and any other applicable securities laws, (c) compliance with the rules and regulations of the NYSE, (d) the filing of the
Certificate of Merger with the Secretary of State of the State of Delaware and appropriate documents with the relevant authorities of
the other jurisdictions in which Merger Sub is qualified to do business and (e) any other actions or filings (i) required solely by reason
of the participation of the Company (as opposed to any Third Party) in the transactions contemplated hereby or (ii) the absence of which
has not had, and would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.
Section
5.04 Non-Contravention.
The execution, delivery and performance by each of Parent and Merger Sub of this Agreement and, assuming compliance with the matters
referred to in Section 5.03, the consummation of the transactions contemplated hereby do not and will not (a) contravene,
conflict with, or result in any violation or breach of any provision of the organizational documents of Parent or Merger Sub, (b) contravene,
conflict with, or result in a violation or breach of any provision of any Applicable Law, (c) require any consent or other action
by any Person under, violate, conflict with, result in breach of, constitute a default (or an event that, with notice or lapse of time
or both, would become a default) under, or cause or permit the termination, acceleration of performance or cancellation of any agreement
binding upon Parent or Merger Sub or any of their respective Subsidiaries or (d) result in the creation or imposition of any Lien
on any properties, rights or asset of Parent or Merger Sub or any of their respective Subsidiaries other than Permitted Liens, with only
such exceptions, in the case of each of clauses (b) through (d), as has not had, and would not reasonably be expected to
have, individually or in the aggregate, a Parent Material Adverse Effect.
Section
5.05 Disclosure Documents.
None of the information supplied or to be supplied by or on behalf of Parent specifically for inclusion in the Proxy Statement will,
at the date it (and any amendments or supplements thereto) is first mailed to the stockholders of the Company and at the time of the
Company Stockholders Meeting, contain any untrue statement of a material fact or omit to state any material fact required to be stated
therein or necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading,
except that no representation or warranty is made by Parent with respect to statements made or incorporated by reference therein based
on information supplied by the Company or any of its Representatives in writing specifically for use or incorporation by reference therein.
Section
5.06 Compliance with Laws.
Parent and each of its Subsidiaries are, and since January 1, 2022 have been, in compliance with all Applicable Laws, except for failure
to comply or violations that would not reasonably be expected to have, individually or in the aggregate, a Parent Material Adverse Effect.
Section
5.07 Litigation. As
of the date hereof, there is no Proceeding pending, or to the Knowledge of Parent, threatened, against Parent and there is no Order outstanding
that in any manner seeks to prevent, enjoin or materially delay Parent’s or Merger Sub’s ability to consummate the Merger
or any of the other transactions contemplated hereby.
Section
5.08 Finders’ Fees. Except as set forth on Section
5.08 of the Parent Disclosure Schedule, there is no investment banker, financial advisor, broker, finder or other intermediary that
has been retained by or is authorized to act on behalf of Parent or any of its Subsidiaries who might be entitled to any fee or commission
from Parent or any of its Affiliates in connection with the transactions contemplated by this Agreement.
Section
5.09 Financing.
(a)
Parent has delivered to the Company a true, complete and fully executed copy of a debt commitment letter, dated as of January
16, 2024 (including all related exhibits, schedules, annexes, supplements and term sheets thereto, and including any related fee letter
as described below and redacted in accordance with Section 5.09(d), as each of the foregoing may be amended, supplemented, replaced,
substituted, terminated or otherwise modified or waived from time to time after the date hereof in compliance with Section 6.06,
the “Debt Commitment Letter”), from the Debt Financing Sources party thereto confirming their respective commitments
to provide Parent (or a Subsidiary thereof) with debt financing, subject to the terms and conditions thereof, in connection with the
transactions contemplated hereby in the amount set forth therein (including, for the avoidance of doubt, the issuance of senior notes
or other debt securities, the “Debt Financing”).
(b)
Parent has delivered to the Company a true, complete and fully executed copy of an equity commitment letter dated as of January
11, 2024 (including all related exhibits, schedules, annexes, supplements and term sheets thereto, and including an executed fee letter
as redacted in a customary manner to remove the fee amounts and certain other terms (none of which could reasonably be expected to adversely
affect the conditionality, enforceability, termination or aggregate amount of the Equity Financing to be made available thereunder),
as each of the foregoing may be amended, supplemented, replaced, substituted, terminated or otherwise modified or waived from time to
time after the date hereof in compliance with Section 6.06, the “Equity Commitment Letter”, and together with
the Debt Commitment Letter, the “Commitment Letters”) from the Equity Financing Sources party thereto confirming their
respective commitments to provide Parent with equity financing in connection with the transactions contemplated hereby in the amount
set forth therein (the “Equity Financing”, and together with the Debt Financing, the “Financing”).
(c)
Each Commitment Letter is in full force and effect and is a valid and binding obligation of Parent and, to the knowledge of Parent,
the other parties thereto, enforceable against Parent and, to the knowledge of Parent, the other parties thereto in accordance with its
terms (subject to applicable bankruptcy, insolvency, fraudulent transfer, reorganization, moratorium and other laws affecting creditors’
rights generally and general principles of equity). As of the date hereof, neither Commitment Letter has been amended or modified, the
respective commitments contained in the Commitment Letters have not been withdrawn, rescinded or otherwise modified, and no such amendment,
modification, withdrawal or rescission of either Commitment Letter is currently contemplated or the subject of current discussions (other
than amendments to the Debt Commitment Letter to add additional lenders, arrangers and agents or reallocate commitments or assign or
reassign titles or roles to, or between or among, any entities party thereto). As of the date hereof, no event has occurred which, with
or without notice, lapse of time or both, would or would reasonably be expected to constitute a default or breach on the part of Parent,
Merger Sub or any
of their respective
Affiliates or, to the knowledge of Parent, any other Person, under the Commitment Letters. All fees (if any) required to be paid under
the Commitment Letters on or prior to the date hereof have been paid in full.
(d)
There are no conditions precedent directly or indirectly related to the funding of the full amount of the Financing other than
as expressly set forth in the Commitment Letters. Other than the Commitment Letters, there are no other contracts, arrangements or understandings
entered into by Parent or any Affiliate thereof related to the funding or investing, as applicable, of the Financing (except for (i)
customary fee letters relating to the commitments in the Commitment Letters, a true, complete and fully executed copy of each of which
has been provided to the Company, with only the fee amounts, “market flex” (in the case of the Debt Commitment Letter), “structure
flex” (in the case of the Debt Commitment Letter), pricing terms, pricing caps and other commercially sensitive terms redacted;
provided that Parent represents and warrants that, in the case of the Debt Commitment Letter, the market flex and structure flex provisions
in such fee letter do not permit the imposition of any new conditions (or the modification or expansion of any existing conditions) or
(ii) customary engagement letters or non-disclosure agreements which do not impact the conditionality or amount of the Financing). As
of the date hereof, assuming the satisfaction of the conditions to Parent’s obligation to consummate the Merger, Parent has no
reason to believe that any of the conditions to the Financing will not be satisfied or that the full amount of the Financing will not
be available to Parent on the Closing Date.
(e)
Assuming (i) the accuracy of the representations and warranties of the Company in Section 4.05 and Section 4.23
(other than for de minimis inaccuracies), (ii) the Financing is funded on the Closing Date in accordance with the Commitment Letters
and (iii) the Closing is consummated in accordance with the terms of this Agreement following satisfaction of the conditions precedent
thereto, the aggregate proceeds of the Financing (after giving effect to any market flex provisions in the case of the Debt Financing),
together with any cash on hand, available lines of credit and other sources of immediately available funds, will be in an amount sufficient
to enable Parent to make payment of the Merger Consideration and any other amounts to be paid by it hereunder or under the Commitment
Letters. Parent acknowledges and agrees that the availability of funds (including the Financing) will not be a condition to the obligation
of Parent or Merger Sub to consummate the transactions contemplated hereby.
Section
5.10 Solvency. Assuming
(a) the satisfaction of the conditions to Parent’s obligation to consummate the Merger, (b) the accuracy of the representations
and warranties set forth in Article 4 in all material respects and (c) the Company and its Subsidiaries, on a consolidated basis,
are Solvent immediately prior to the Effective Time, after giving effect to the transactions contemplated by this Agreement (including
the payment of the aggregate Merger Consideration and the payment of all related fees and expenses), the Surviving Corporation on a consolidated
basis will be Solvent as of the Effective Time and immediately after the consummation of the transactions contemplated hereby. For purposes
of this Agreement, “Solvent” when used with respect to any Person, means that as of any date of determination (i)
the fair value of the assets of such Person and its Subsidiaries on a consolidated basis, at a fair valuation, will exceed the debts
and liabilities, contingent, subordinated or otherwise, of such Person and its Subsidiaries on a consolidated basis, (ii) the present
fair salable value of the property of such Person and its Subsidiaries on a consolidated basis will be greater than the amount that
will be required
to pay the probable liability of such Person and its Subsidiaries on a consolidated basis on their debts and liabilities as they become
absolute and matured, (iii) such Person and its Subsidiaries on a consolidated basis will be able to pay their debts and liabilities,
subordinated, contingent or otherwise, as they become absolute and matured and become due in the usual course of their affairs and (iv)
such Person and its Subsidiaries on a consolidated basis will not have unreasonably small capital with which to conduct the business
in which they are engaged as such businesses are now conducted and proposed to be conducted following the Closing Date.
Section
5.11 Ownership of Common
Shares. Except as set forth on Section 5.11 of the Parent Disclosure Schedule, neither Parent nor Merger Sub nor any of their
respective Affiliates or “associates” is the beneficial owner (within the meaning of Section 13 of the 1934 Act and the rules
and regulations promulgated thereunder) of any Company Common Shares or other Company Securities, or is a party to any agreement, arrangement
or understanding (other than this Agreement) for the purpose of acquiring, holding, voting, directing the voting of or disposing of any
Company Common Shares or other Company Securities. Neither Parent nor Merger Sub nor any of their respective Affiliates or “associates”
is, or has been within the past three (3) years, an “associate” of the Company. For purposes of this Section 5.11,
the term “associate” shall have the meaning ascribed to it in Rule 12b-2 of the 1934 Act.
Section
5.12 Termination of Masonite
Agreement. Substantially concurrently with the execution and delivery of this Agreement, the Company Termination Fee (as defined
in the Masonite Agreement) was paid by Parent, on behalf of the Company, to Masonite by wire transfer of immediately available funds.
Section
5.13 Acknowledgement of
No Other Representations and Warranties. Except for the representations and warranties set forth in Article 4,
in any certificate delivered pursuant to this Agreement, each of Parent and Merger Sub acknowledges and agrees that no representation
or warranty of any kind whatsoever, express or implied, at law or in equity, is made or shall be deemed to have been made by or on behalf
of the Company to Parent or Merger Sub, and each of Parent and Merger Sub hereby disclaims reliance on any such other representation
or warranty, whether by or on behalf of the Company, and notwithstanding the delivery or disclosure to Parent or Merger Sub, or any of
their respective Representatives or Affiliates, of any documentation or other information by the Company or any of their respective Representatives
or Affiliates with respect to any one or more of the foregoing.
Article
6
Covenants Of The Company
Section
6.01 Conduct of the Company.
Except (w) with the prior written consent of Parent (which consent shall not be unreasonably withheld, conditioned or delayed), (x) as
required or expressly contemplated by this Agreement, (y) as set forth in Section 6.01 of the Company Disclosure
Schedule or (z) as required by Applicable Law, from the date hereof until the Effective Time, the Company shall, and shall cause each
of its Subsidiaries to, (i) use reasonable best efforts to (A) conduct its business in accordance with Applicable Law and in the ordinary
course of business and (B) preserve intact in all material respects its current business operations, organization, ongoing businesses,
license, permits and material business relationships with third parties, including vendors, suppliers, customers, partners and Governmental
Authorities and
maintaining in
full force and effect its insurance policies (including, for the avoidance of doubt, paying all premiums thereon and renewing or replacing
such insurance policies on or prior to their expiration) in all material respects, in each case, consistent with past practice or customs
in the industries in which the Company and its Subsidiaries conduct business (provided that, in the case of the foregoing clause
(i), no action with respect to the matters addressed by any subclause of the following clause (ii) shall constitute a breach of clause
(i) unless any such action would constitute a breach of such subclause of the following clause (ii)) and (ii) not:
(a)
amend its certificate of incorporation, bylaws or other similar organizational documents of the Company or any of its Subsidiaries,
other than immaterial amendments to the organizational documents of the Company’s Subsidiaries;
(b)
(i) split, combine, subdivide, reduce or reclassify any shares of its capital stock, (ii) declare, set aside or pay any dividend
or other distribution (whether in cash, shares or property or any combination thereof) in respect of its capital stock, except for dividends
or other such distributions by any of its wholly owned Subsidiaries or (iii) redeem, repurchase or otherwise acquire or offer to redeem,
repurchase, or otherwise acquire any Company Securities or any Company Subsidiary Securities, except as required by the terms of any
Company Plan;
(c)
(i) issue, deliver, grant or sell, or authorize the issuance, delivery, grant or sale of, any Company Securities or Company Subsidiary
Securities, other than the issuance of (A) any Company Common Shares upon the settlement of Company Restricted Shares or Company RSUs,
in each case, outstanding on the date of this Agreement in accordance with their terms as in effect on the date of this Agreement or
issued after the date hereof in accordance with this Section 6.01 and in accordance with their terms, (B) subject to Section
2.05(d), the issuance of Company Common Shares upon the exercise of the rights under the ESPP in accordance with the terms thereof
as in effect on the date of this Agreement and (C) an issuance, delivery or sale among the Company and any of its wholly owned Subsidiaries
or between any of such wholly owned Subsidiaries or (ii) amend any term of any Company Security or any Company Subsidiary Security, except
as required by the terms of any Company Plan as in effect on the date of this Agreement;
(d)
acquire (by merger, consolidation, acquisition of shares or assets or otherwise), directly or indirectly, any securities or business
in excess of $1,000,000 in the aggregate in any one transaction or series of related transactions (for the avoidance of doubt, it being
understood that the foregoing is subject to the provisions of Section 8.01(c));
(e)
enter into any new line of business outside the existing business of the Company and its Subsidiaries as of the date of this Agreement;
(f)
sell, lease, license, assign or otherwise transfer, abandon or otherwise dispose, voluntarily permit to lapse, encumber or subject
to any Lien (in each case, other than Permitted Liens) any businesses, properties or assets of the Company or any of its Subsidiaries,
including Company-Owned Intellectual Property, other than (i) such sales, leases, non-exclusive licenses, assignments, transfers, liens
or other dispositions that are in the ordinary course of business, or (ii) such abandonment or permitting to lapse of any Company-Owned
Intellectual Property that is not material to the Company or any of its Subsidiaries;
(g)
make or authorize any capital expenditure other than any capital expenditures that: (i) are provided for in the Company’s
capital expense budget set forth in Section 6.01(g) of the Company Disclosure Schedule; or (ii) when added to all other capital
expenditures made on behalf of the Company and its Subsidiaries since the date of this Agreement but not provided for in such capital
expense budget, do not exceed $3,000,000 individually or in the aggregate during any fiscal quarter;
(h)
other than in connection with actions permitted by Section 6.01(c), make any loans, advances or capital contributions to,
or investments in, any other Person (other than loans or advances among the Company and any of its wholly owned Subsidiaries and capital
contributions to or investments in its wholly owned Subsidiaries), other than trade credit and similar loans and advances made to employees,
customers and suppliers in the ordinary course of business;
(i)
other than (i) borrowings under the Company’s existing credit agreements in the ordinary course of business and in an aggregate
principal amount not to exceed $40,000,000 or (ii) indebtedness incurred between the Company and any of its wholly owned Subsidiaries
or between any of such wholly owned Subsidiaries or guarantees by the Company of indebtedness of any wholly owned Subsidiary of the Company,
(A) incur any indebtedness for borrowed money (or guarantees thereof) or (B) assume, guarantee, endorse or otherwise become liable or
responsible (whether directly, contingently or otherwise) for any material obligations of any other Person, except with respect to obligations
of direct or indirect wholly owned Subsidiaries of the Company, in the cases of the foregoing clauses (A) and (B), in excess of $5,000,000
in the aggregate;
(j)
other than in connection with any stockholder or derivative litigation, which is the subject of Section
8.08, commence (other than any collection action in the ordinary course of business), waive, release, assign, compromise or settle
any Proceedings that would require a payment by the Company in excess of $500,000 in any individual case or $2,000,000 in the aggregate,
other than claims reserved against in the financial statements of the Company (for amounts not materially in excess of such reserves);
provided that, the payment, discharge, settlement or satisfaction of such Proceeding does not include any material obligation (other
than the payment of money and confidentiality and other similar obligations incidental to such waiver, release, assignment, compromise
or settlement) to be performed, or the admission of wrongdoing, by the Company or any of its Subsidiaries or any of their respective
officers or directors;
(k)
(i) amend or modify in any material respect, waive any material rights under, terminate (other than any termination in accordance
with the terms of an existing Material Contract), release, settle or compromise any material claim, liability or obligation under any
Material Contract or (ii) enter into any contract which if entered into prior to the date of this Agreement would have been a Material
Contract, in each case other than (A) the automatic renewal or extension of any such Material Contract pursuant to its terms or on terms
not less favorable for the Company, taken as a whole or (B) with respect to contracts that are Material Contracts solely as a result
of (1) Section 4.20(a)(i) (Top Customer Contracts), (2) Section 4.20(a)(ii) (Top Supplier Contracts), (3)
Section 4.20(a)(iii) (Certain Contracts Involving Payments in Excess of $3 Million), (4) Section 4.20(a)(xi) (Indebtedness),
to the extent related to indebtedness, whether incurred, assumed, guaranteed or secured by any asset (and including any related security
or pledge
agreements) permitted
by Section 6.01(i) and/or (5) Section 4.20(a)(xii) (Capital Expenditures), to the extent related to contributions
of capital, capital expenditures or the acquisition or construction of fixed assets permitted by Section 6.01(g), in each case
of clauses (1) through (5), in the ordinary course;
(l)
except as required under the terms of any Company Plan as in effect on the date of this Agreement, (i) grant, increase or accelerate
the compensation, bonuses or other benefits of any Company Service Provider, (ii) grant, pay or award any bonus, change in control, deferred
compensation, severance, retention, equity or equity-based right or other incentive compensation to any Company Service Provider, except
in the case of separation and release agreements entered into in the ordinary course of business providing for severance in accordance
with the terms of the Company Plan as in effect on the date of this Agreement applicable to such Company Service Provider with employees
below the level of vice president who are terminated in the ordinary course of business, (iii) establish, adopt, terminate or amend in
any material respect any Company Plan (or any plan, program, arrangement, practice or agreement that would be a material Company Plan
if it were in existence on the date of this Agreement), not including annual renewals of broad-based, nondiscriminatory welfare benefit
plans made in the ordinary course of business consistent with past practice, (iv) amend or waive any of its rights under, or accelerate
the vesting under, any provision of any of the Company Plans (or any plan, program, arrangement, practice or agreement that would be
a Company Plan if it were in existence on the date of this Agreement) or (v) terminate any employee at or above the vice president level,
other than for cause, or hire any employee at or above the vice president level (or promote any employee to such level); provided, however,
that, notwithstanding anything herein to the contrary, the Company and its Subsidiaries may (A) provide increases in base salary or wages
in connection with new hires, promotions or merit increases in the ordinary course of business for employees at or below the level of
vice president, provided that such increases shall not exceed four percent (4%) in the aggregate, (B) make, determine and pay
annual or quarterly bonus payments, commissions and other short- or long-term cash incentive awards in the ordinary course of business
based on actual performance in accordance with the terms of the Company Plans for employees below the level of vice president (provided
that, prior to making any such payment, the Company shall consult with Parent, provide to Parent details regarding its determination
of actual performance and consider Parent’s comments in good faith), and (C) establish performance targets in respect of any cash
incentive compensation or awards with performance periods covering all or any portion of fiscal year 2024 in the ordinary course of business
and subject to prior consultation with Parent;
(m)
modify, extend, or enter into any CBA, or recognize or certify any labor union, labor organization, or group of Company Service
Providers as the bargaining representative for any employees of the Company or its Subsidiaries;
(n)
adopt a plan of complete or partial liquidation, dissolution, restructuring, recapitalization or other reorganization of the Company
(other than the Merger);
(o)
change the Company’s methods of financial accounting or make any material change in any method of financial accounting practice
or working capital or cash management practice or policy applicable to the Company or its Subsidiaries, except as required by concurrent
changes in GAAP or in Regulation S-X of the 1934 Act, as agreed to by its independent public accountants;
(p)
make (other than in the ordinary course of business), change or revoke any material Tax election, change any Tax accounting period,
make any material change in any of its methods of Tax accounting, or settle or compromise any material Tax claim, audit or assessment,
enter into any closing agreement pursuant to Section 7121 of the Code (or any similar provision of state, local or non-U.S. Applicable
Law), or amend any material Tax Return;
(q)
engage in any transaction with, or enter into any agreement, arrangement or understanding with, any Person covered by Item 404
of Regulation S-K promulgated by the SEC that would be required to be disclosed pursuant to Item 404; or
(r)
agree, resolve or commit to do any of the foregoing.
Section
6.02 Company Stockholders
Meeting. The Company shall (a) as soon as reasonably practicable (and in any event within five (5) Business Days) following the date
the SEC staff advises that it has no further comments on the Proxy Statement or that the Company may commence mailing the Proxy Statement,
duly call and give notice of, and commence mailing of the Proxy Statement to the holders of Company Common Shares as of the record date
established for, a meeting of holders of the Company Common Shares (the “Company Stockholders Meeting”) to take place
within thirty-five (35) days following the first mailing of the Proxy Statement to the Company’s stockholders for purposes
of seeking (i) the Company Stockholder Approval and (ii) at the Company’s sole discretion, the approval or adoption by the Company’s
stockholders of an amendment to the Amended and Restated Certificate of Incorporation of the Company, in substantially the form attached
hereto as Exhibit B, designating the Company as the agent of stockholders of the Company for the purpose of enforcing such stockholders’
rights as contemplated by Section 11.06(a) (such amendment, the “Company Organizational Document Amendment”)
(it is being understood that in no event shall the Closing be conditioned on approval by the Company’s stockholders of the Company
Organizational Document Amendment), (b) reasonably cooperate with Parent in initiating a “broker search” in accordance with
Rule 14a-13 of the 1934 Act as necessary to cause the Company to comply with its obligations set forth in the foregoing clause (a) and
(c) as soon as reasonably practicable following the commencement of the mailing of the Proxy Statement pursuant to the foregoing clause
(a), convene and hold the Company Stockholders Meeting in accordance with the DGCL and applicable requirements of the NYSE; provided
that the Company may adjourn or postpone the Company Stockholders Meeting to a later date (1) with the consent of Parent or (2) to the
extent the Company believes in good faith (after consultation with outside legal counsel) that such adjournment or postponement is reasonably
necessary (x) due to Applicable Law or a request from the SEC or its staff, (y) to allow reasonable additional time to solicit additional
proxies necessary to obtain the Company Stockholder Approval or (z) to ensure that there are sufficient Company Common Shares represented
(either in person or by proxy) and voting to constitute a quorum necessary to conduct the business of the Company Stockholders Meeting;
provided, however, that unless required by Applicable Law, in no event shall the Company Stockholders Meeting be postponed or adjourned
more than once or for more than twenty (20) Business Days in the aggregate without the prior written consent of Parent. Subject to Section
6.04, the Board of Directors shall recommend that the holders of the Company Common Shares adopt this Agreement, and the Company
shall (x) include the Company Recommendation in the Proxy Statement, (y) use its reasonable best efforts to obtain the Company Stockholder
Approval and (z) otherwise comply in all material respects with all legal requirements applicable to such meeting. In the event that
the Board of Directors
makes an Adverse
Recommendation Change pursuant to Section 6.04 and this Agreement has not been terminated in accordance with its terms in connection
therewith, the Company will nevertheless submit this Agreement to the Company’s stockholders for the purpose of obtaining the Company
Stockholder Approval unless this Agreement shall have been terminated in accordance with its terms prior to the Company Stockholders
Meeting. The Company may take all actions reasonably necessary to render the Company Organizational Document Amendment effective and
enforceable, including submitting any necessary filings in connection therewith. The Company shall permit Parent and its Representatives
to attend the Company Stockholders Meeting.
Section
6.03 Access to Information.
(a)
From the date hereof until the Effective Time, subject to Applicable Law, the Company shall (i) give Parent and its Representatives,
upon reasonable notice, reasonable access during normal business hours to the offices, properties, assets, books and records and personnel
(including employees and agents) of the Company and its Subsidiaries, (ii) promptly furnish to Parent and its Representatives such financial
and operating data and other information (including, for the avoidance of doubt, the work papers of the Company’s auditors to the
extent Parent has executed a release in a form reasonably satisfactory to the Company’s auditors) as such Persons may reasonably
request and (iii) instruct its Representatives to cooperate reasonably with Parent in its investigation of the Company and its Subsidiaries
(provided that the Company’s investment bankers, attorneys, accountants and other advisors will not be required to furnish to Parent
or its Representatives any of their internal documents or materials); provided that, in each case, such access may be limited to the
extent, that such access would jeopardize the health and safety of any of its Representatives; provided, further, that the Company
may, in its sole discretion, designate any competitively sensitive material as “Outside Counsel Only Material” such that
such materials and the information contained therein shall be furnished only to the outside counsel of Parent and will not be disclosed
to any other Persons unless express permission is obtained in advance from the Company or its legal counsel. The Company shall have the
right to have its Representatives present in any investigation pursuant to this Section 6.03, and such investigation shall be
conducted in such manner as not to interfere unreasonably with the conduct of the business of the Company and its Subsidiaries. Nothing
in this Section 6.03 shall require the Company to provide any access, or to disclose any (A) information if providing such access
or disclosing such information would violate any Applicable Law (including Competition Laws and privacy laws), (B) communications between
the Company and its investment bankers, attorneys, accountants and other advisors or (C) information protected by attorney-client privilege
to the extent such privilege cannot be protected by the Company through exercise of its reasonable best efforts; provided that, in the
case of clauses (A) and (C), the Company shall use reasonable best efforts to allow for such access or disclosure (or as much of it as
possible) in a manner that would not violate any such Applicable Law or jeopardize the protection of the attorney-client privilege.
(b)
All information exchanged or otherwise received pursuant to Section 6.03(a) will be subject to the confidentiality agreement
dated as of August 28, 2023, between the Company and Parent (the “Confidentiality Agreement”) and the Clean Team Agreement.
No information or knowledge obtained in any investigation pursuant to this Section 6.03 shall affect or limit or be deemed to
modify any representation or warranty made by any party hereunder or any rights or remedies available to any party under this Agreement.
Section
6.04 No-Shop; Other Offers.
(a)
No-Shop. Except as otherwise expressly permitted by the remainder of this Section 6.04, until the earlier to occur
of the valid termination of this Agreement pursuant to Article 10 and the Effective Time, the Company shall not, shall cause its
Subsidiaries not to and shall use reasonable best efforts to cause its and their respective Representatives not to, directly or indirectly,
(i) solicit, initiate or take any action to knowingly induce the making, submission or announcement of, or knowingly facilitate or encourage
the submission of any inquiry or proposal that constitutes, or would reasonably be expected to lead to, any Acquisition Proposal, (ii)
enter into, participate or engage in any discussions or negotiations with, furnish any material nonpublic information relating to the
Company or any of its Subsidiaries or knowingly afford access to the business, properties, assets, books or records, or to any personnel,
of the Company or any of its Subsidiaries to, or otherwise knowingly cooperate with, any Third Party, in each case relating to an Acquisition
Proposal by such Third Party or that would reasonably be expected to lead to an Acquisition Proposal, (iii) (A) withhold (or qualify
or modify in a manner adverse to Parent or Merger Sub), or publicly announce its intention to do the same, the Company Recommendation,
or fail to include the Company Recommendation in the Proxy Statement in accordance with Section 6.02, (B) other than with respect
to a tender offer or exchange offer, within ten (10) Business Days of Parent’s written request, fail to make or reaffirm the Company
Recommendation following the date any Acquisition Proposal or any material modification thereto is first published or broadly sent or
given to the stockholders of the Company (provided that Parent shall be entitled to make such a written request for reaffirmation only
once for each Acquisition Proposal and for each material modification to such Acquisition Proposal) or (C) fail to recommend, in a Solicitation/Recommendation
Statement on Schedule 14D-9, against any Acquisition Proposal that is a tender offer or exchange offer subject to Regulation D promulgated
under the 1934 Act within ten (10) Business Days after the commencement (within the meaning of Rule 14d-2 under the 1934 Act) of such
tender offer or exchange offer (any of the foregoing in clauses (A) through (C), an “Adverse Recommendation Change”)
or (iv) enter into any agreement in principle, letter of intent, term sheet, memorandum of understanding, merger agreement, acquisition
agreement, option agreement, share exchange agreement, joint venture agreement, other agreement or other similar instrument providing
for, or that would reasonably be expected to lead to, an Acquisition Proposal. The Company shall, and shall cause its Subsidiaries and
its and their Representatives to, cease immediately and cause to be terminated any and all existing activities, discussions or negotiations
with any third party and its Representatives conducted prior to the date hereof with respect to any Acquisition Proposal. Within four
(4) Business Days after the date hereof, the Company shall (i) request in writing that each Person that has heretofore executed a confidentiality
agreement in connection with its consideration of an Acquisition Proposal or potential Acquisition Proposal promptly destroy or return
to the Company all nonpublic information heretofore furnished by the Company or any of its Representatives to such person or any of its
Representatives in accordance with the terms of such confidentiality agreement and (ii) terminate access to any physical or electronic
data rooms relating to a possible Acquisition Proposal by such Person and its Representatives.
(b)
Exceptions. Notwithstanding anything contained in this Section 6.04 to the contrary, at any time prior to receipt
of the Company Stockholder Approval:
(i)
the Company, directly or indirectly through its Representatives, may (A) engage in negotiations or discussions with any Third
Party and its Representatives that has made a bona fide offer, inquiry, proposal or indication of interest with respect to an
Acquisition Proposal that did not result from a material breach of Section 6.04(a) that the Board of Directors determines in good
faith, after consultation with its outside legal counsel and financial advisor, constitutes or would reasonably be expected to lead to
a Superior Proposal and (B) furnish to such Third Party or its Representatives nonpublic information relating to the Company or any of
its Subsidiaries and afford access to the business, properties, assets, books or records and personnel of the Company or any of its Subsidiaries
pursuant to an Acceptable Confidentiality Agreement; provided that, to the extent that any nonpublic information relating to the Company
or its Subsidiaries is provided to any such Third Party or any such Third Party is given access which was not previously provided to
or made available to Parent, such nonpublic information or access is provided or made available to Parent and its Representatives substantially
contemporaneously with (and in any event within twenty-four (24) hours of) the time it is provided to such Third Party; and
(ii)
subject to compliance with Section 6.04(d), the Board of Directors may, (A) in response to a bona fide offer, inquiry,
proposal or indication of interest with respect to an written Acquisition Proposal that did not result from a material breach of Section
6.04(a) that the Board of Directors has determined in good faith, after consultation with its outside legal counsel and financial
advisor, constitutes a Superior Proposal, make an Adverse Recommendation Change or terminate this Agreement pursuant to and in accordance
with Section 10.01(d)(i) in order to substantially concurrently enter into a written definitive agreement for such Superior Proposal
or (B) in response to an Intervening Event make an Adverse Recommendation Change, if the Board of Directors determines in good faith,
after consultation with its outside legal counsel and financial advisor, that the failure to take such action would be inconsistent with
its fiduciary duties under Applicable Law.
In
addition, nothing contained in this Agreement shall prevent the Company or the Board of Directors (or any committee thereof) from (1)
taking and disclosing to the Company’s stockholders a position contemplated by Rule 14d-9 and Rule 14e-2(a) promulgated under the
1934 Act (or any similar communication to stockholders in connection with the making or amendment of a tender offer or exchange offer)
or from making any legally required disclosure to stockholders with regard to the transactions contemplated by this Agreement or an offer,
inquiry, proposal or indication of interest with respect to an Acquisition Proposal (provided that neither the Company nor the Board
of Directors may make an Adverse Recommendation Change unless permitted by this Section 6.04(b)), (2) issuing a “stop, look
and listen” disclosure or similar communication of the type contemplated by Rule 14d-9(f) under the 1934 Act or (3) contacting
and engaging in discussions with any person or group and their respective Representatives who has made an offer, inquiry, proposal or
indication of interest with respect to an Acquisition Proposal that was not solicited in breach of this Section 6.04 solely for
the purpose of clarifying such offer, inquiry, proposal or indication of interest and the terms thereof or informing such Third Party
of the restrictions imposed by this Section 6.04.
(c)
Required Notices. Prior to the earlier of the valid termination of this Agreement pursuant to Article 10 and the
Effective Time, the Company shall (i) notify Parent promptly (and in any event no later than twenty-four (24) hours) (A) of the receipt
by the Company
of any Acquisition
Proposal (including any bona fide offer, inquiry, proposal or indication of interest with respect to thereto) or any amendment or modification
to the material terms of any Acquisition Proposal or any material discussions with respect to any such Acquisition Proposal and such
notice shall include, to the extent then known to the Company, the identity of the Person making the Acquisition Proposal (or bona fide
offer, inquiry, proposal or indication of interest with respect to thereto) and the material terms and conditions thereof (along with
unredacted copies of all material proposed transaction agreements and other material documents provided in connection therewith, including
copies of all portions of written materials sent or provided to the Company or any of its Subsidiaries that describe such material terms
and conditions thereof) and (B) of any request for nonpublic information relating to the Company or any of its Subsidiaries or for access
to the business, properties, assets, books or records or personnel of the Company or any of its Subsidiaries by any Third Party that
has notified the Company that it is considering making, or has made, an Acquisition Proposal and (ii) keep Parent reasonably informed
on a reasonably current basis (but in no event less often than once every twenty-four (24) hours) of any changes (or any material discussions
with respect thereto) to the status and material terms and conditions (along with unredacted copies of all material proposed transaction
agreements and other material documents provided in connection therewith, including copies of all portions of written materials sent
or provided to the Company or any of its Subsidiaries that describe such material terms and conditions thereof) of any Acquisition Proposal
(or bona fide offer, inquiry, proposal or indication of interest with respect to thereto).
(d)
Last Look. Neither the Board of Directors nor the Company shall be permitted to take any of the actions referred to in
Section 6.04(b)(ii) unless (i) the Company shall have notified Parent, in writing and at least four (4) Business Days prior to
taking such action, of its intention to take such action, specifying, in reasonable detail, the reasons for the Adverse Recommendation
Change, and (A) in the case of a Superior Proposal, including the identity of the Person or group making such proposal, the terms thereof
and attaching a copy of all proposed agreements (including a true and complete copy of any proposed definitive agreement for such Superior
Proposal, if any) and other documents and information contemplated by Section 6.04(c)(i) for the Superior Proposal, if applicable
or (B) in the case of an Intervening Event, reasonably detailed description of the facts and circumstances relating to such Intervening
Event, (ii) during such four (4) Business Day period following the date on which such notice is received, the Company shall have and
shall have caused its Representatives to, negotiate with Parent in good faith (to the extent Parent wishes to negotiate) to make such
adjustments to the terms and conditions of this Agreement as Parent may propose, (iii) upon the end of such notice period (or such subsequent
notice period as contemplated by clause (iv) below), the Board of Directors shall have considered in good faith any revisions
to the terms of this Agreement and/or the Commitment Letters proposed in writing by Parent that, if accepted by the Company, would be
binding upon Parent, and shall have determined in good faith, after consultation with its outside legal counsel and financial advisor,
that the failure of the Board of Directors to make such Adverse Recommendation Change would be inconsistent with its fiduciary duties
under Applicable Law, and, in the case of Superior Proposal, that such Acquisition Proposal continues to constitute a Superior Proposal
and (iv) in the event of any change to any of the financial terms (including the form, amount and timing of payment of consideration)
or any other material terms of such Superior Proposal, the Company shall, in each case, have delivered to Parent an additional notice
consistent with that described in clause (i) above and a new notice period under clause (i) shall commence
(provided that
the notice period thereunder shall only be three (3) Business Days) during which time the Company shall be required to comply with the
requirements of this Section 6.04(d) with respect to such additional notice, including clauses (i) through (iii)
above.
(e)
Definition of Superior Proposal. For purposes of this Agreement, “Superior Proposal” means a bona
fide, unsolicited, written Acquisition Proposal, made after the date of this Agreement (but substituting “50%” for all
references to “20%” in the definition of such term) that the Board of Directors determines in good faith, after consultation
with its outside legal counsel and financial advisor, is more favorable from a financial point of view to the Company’s stockholders
(solely in their capacity as such) than the Merger, in each case, taking into consideration (i) all relevant factors (including the identity
of the counterparty, the terms and conditions of such Acquisition Proposal (including the transaction consideration, conditionality,
timing, legal, financial (including any break-up fee), certainty of financing and regulatory approvals and the expected timing and likelihood
of consummation and such other factors determined by the Board of Directors in good faith to be relevant)) and (ii) if applicable, any
changes to the terms of this Agreement proposed by Parent pursuant to this Section 6.04 that, if accepted by the Company, would
be binding upon Parent.
(f)
Definition of Intervening Event. For purposes of this Agreement, “Intervening Event” means an event,
fact, circumstance, development or occurrence that (i) was not known to or reasonably foreseeable by the Board of Directors as of the
date of this Agreement, which event or circumstance becomes known to or by the Board of Directors prior to receipt of the Company Stockholder
Approval or (ii) was known to or reasonably foreseeable by the Board of Directors as of the date of this Agreement, but the consequences
of which (or the magnitude thereof) were not and (iii) does not relate to an Acquisition Proposal; provided, that in no event shall the
following constitute or be taken into account in determining the existence of an Intervening Event: (A) the Company meeting, failing
to meet or exceeding any internal or published revenue or earnings forecasts or projections for any period or (B) changes in the market
price or trading volume of Company Common Shares, provided that in the case of the foregoing clauses (A) and (B), the underlying causes
of such Effect may be considered and taken into account in determining whether there has been an Intervening Event.
Section
6.05 Stock Exchange Delisting.
Prior to the Effective Time, the Company shall cooperate with Parent and use its reasonable best efforts to take, or cause to be taken,
all actions, and do or cause to be done all things, reasonably necessary, proper or advisable on its part under Applicable Laws and the
rules and policies of the NYSE to enable the delisting by the Surviving Corporation of the Company Common Shares from the NYSE and the
deregistration of the Company Common Shares under the 1934 Act as promptly as practicable after the Effective Time.
Section
6.06 Debt Financing Cooperation.
(a)
The Company shall use its reasonable best efforts to, and shall cause its Subsidiaries and its and their respective Representatives
to use their reasonable best efforts to, provide all cooperation in connection with the arrangement of the Debt Financing as may be reasonably
requested by Parent that is necessary and customary for financings of the type contemplated by the Debt Commitment Letter as in effect
on the date hereof, including using reasonable best efforts in connection with the following:
(i)
participating in a reasonable number of meetings, due diligence sessions, presentations, drafting sessions, lender meetings,
“road shows” and similar sessions with the Debt Financing Sources and other prospective financing sources, investors and
ratings agencies, in each case on reasonable advance notice;
(ii)
assisting with the preparation of materials for rating agency presentations, offering memoranda, private placement memoranda,
prospectuses, prospectus supplements, registration statements, lender and investor presentations, bank information memoranda (including
a bank information memorandum that does not include material non-public information and the delivery of customary authorization letters
with respect to the bank information memoranda executed by a senior officer of the Company authorizing the distribution of information
to prospective lenders or investors and containing (A) a representation to the Debt Financing Sources that the public side versions of
such documents, if any, do not include material non-public information about the Company or its Subsidiaries or their securities and
(B) a “10b-5” representation by the Company consistent with the Debt Commitment Letter) and similar marketing documents required
in connection with the Debt Financing;
(iii)
assisting Parent in obtaining any corporate or facility ratings from any ratings agencies required in connection with the Debt
Financing;
(iv)
furnishing, at least three (3) Business Days prior to the Closing, such documentation and information as is requested in writing
by the Parent at least ten (10) days prior to the Closing to the extent required under applicable “know your customer” and
anti-money laundering rules and regulations, including the USA PATRIOT Act and 31 C.F.R. §1010.230, in order to satisfy the conditions
set forth in the Debt Commitment Letter;
(v)
(x) executing and delivering any credit agreements, pledge and security documents, guarantees, other definitive financing documents
and schedules thereto or other requested certificates or documents; provided that (A) none of the foregoing documents or certificates
shall be executed and/or delivered, except in connection with the Closing and (B) the effectiveness thereof shall be conditioned upon,
or become operative after or concurrently with, the occurrence of the Closing and (y) facilitating the obtaining of guarantees and pledging
of collateral and other similar matters ancillary to the Debt Financing, in each case as may be reasonably requested by Parent;
(vi)
providing the information set forth in clause (x) of the definition of Required Information and, to the extent a “Structure
Flex Decision” or “Structure Flex Securities Demand” (each as defined in the Debt Commitment Letter as in effect as
of the date hereof) has been exercised under the Debt Commitment Letter, clause (y) of the definition of Required Information, in each
case for use in connection with the Debt Financing;
(vii)
(x) using reasonable best efforts to cause the applicable independent auditors to reasonably cooperate with Parent in connection
with the Debt Financing, including by participating in accounting due diligence sessions upon reasonable advance notice and (y) using
reasonable best efforts to obtain the consent of, and facilitate the delivery of, customary “comfort letters” (including
as to customary negative assurance) for a Rule 144A private placement of debt securities from, the applicable independent auditors if
reasonably necessary or customary for
Parent’s
use of the financial statements of the Company and its subsidiaries in any marketing or offering materials to be used in connection with
the Debt Financing;
(viii)
using reasonable best efforts to take such actions as are reasonably requested by Parent or the Debt Financing Sources to facilitate
the satisfaction of the conditions set forth in the Debt Commitment Letter that are within the Company’s control (including reasonably
facilitating the taking of collateral contemplated by the Debt Financing) and the taking of corporate actions by the Company and its
Subsidiaries; provided that any such taking of collateral or corporate actions shall be contingent upon and effective as of the Closing;
and
(ix)
delivering notices of prepayment or redemption within the time periods required by the Company Credit Agreement or the Company
Indenture, as applicable (which may be conditional upon Closing), and using reasonable best efforts to obtain customary payoff letters,
lien terminations and instructions of discharge and to give any other necessary notices to allow for the payoff, discharge and termination
of the indebtedness under the Company Credit Agreement and the Company Indenture substantially concurrently with the Closing.
(b)
Notwithstanding the foregoing, nothing in this Section 6.06 shall require the Company or any of its Subsidiaries to:
(i)
take any action in respect of the Debt Financing to the extent that such action would cause any condition to Closing set forth
in Article 9 to fail to be satisfied by the End Date or otherwise result in a breach of this Agreement by the Company;
(ii)
take any action in respect of the Debt Financing that would conflict with or violate the Company’s or any if its Subsidiary’s
organizational documents or any Applicable Law, or result in the contravention of, or violation of breach of, or default under, any material
contract to which the Company or any of its subsidiaries is a party;
(iii)
take any action to the extent such action would unreasonably interfere with the business or operations of the Company or its Subsidiaries;
(iv)
execute and deliver any letter, agreement, document or certificate in connection with the Debt Financing or take any corporate
action that is not contingent on, or that would be effective prior to, the occurrence of the Closing;
(v)
pay any commitment fee or other fee or payment to obtain consent or incur any liability with respect to or cause or permit any
Lien to be placed on any of their respective assets in connection with the Debt Financing prior to the Closing Date;
(vi)
provide access to or disclose information where the Company determines that such access or disclosure would reasonably be expected
to jeopardize the attorney-client privilege or contravene any applicable law or contract;
(vii)
subject the Company or any of its Subsidiaries, respective directors, managers, officers or employees to any actual or potential
personal liability;
(viii)
cause the directors and managers of the Company and its Subsidiaries to adopt resolutions (or take other corporate action) approving
the agreements, documents and instruments pursuant to which the Debt Financing is obtained unless Parent shall have determined that such
directors and managers are to remain as directors and managers of the Company and the applicable Subsidiaries on and after the Closing
Date and such resolutions (or take other corporate action) are contingent upon the occurrence of, or only effective as of, the Closing;
(ix)
waive or amend any terms of this Agreement or any other contract to which the Company or its Subsidiaries is party; or
(x)
take any action that would subject it to actual or potential liability, to bear any cost or expense or to make any other payment
or agree to provide any indemnity in connection with the Debt Commitment Letter, the definitive documents related to the Debt Financing
or any information utilized in connection therewith (in each case, except following the Closing).
(c)
Parent shall promptly, upon request by the Company, reimburse the Company for all reasonable and documented out-of-pocket costs
and expenses (including reasonable attorneys’ fees) incurred by the Company or any of its Subsidiaries in connection with the cooperation
of the Company and its Subsidiaries contemplated by this Section 6.06 and shall indemnify and hold harmless the Company, its Subsidiaries
and their respective Representatives from and against any and all losses, damages, claims, costs or expenses actually suffered or incurred
by any of them of any type in connection with the arrangement of any Financing and any information used in connection therewith, except
to the extent such losses, damages, claims, costs or expenses result from the gross negligence, bad faith or willful misconduct of the
Company, any of its Subsidiaries or their respective Representatives or Affiliates, and the foregoing obligations shall survive the valid
termination of this Agreement.
(d)
All material non-public information provided by the Company or any of its Subsidiaries or any of their Representatives pursuant
to this Section 6.06 shall be kept confidential in accordance with the Confidentiality Agreement, except that Parent and Merger
Sub shall be permitted to disclose such information to the financing sources, other potential sources of capital, rating agencies and
prospective lenders during syndication of the Financing or any permitted replacement, amended, modified or alternative financing subject
to the potential sources of capital, ratings agencies and prospective lenders and investors entering into customary confidentiality undertakings
with respect to such information (including through a notice and undertaking in a form customarily used in confidential information memoranda
for senior credit facilities).
(e)
Parent and Merger Sub acknowledge and agree that, notwithstanding anything in this Agreement to the contrary, the obligations
to perform their respective agreements hereunder, including to consummate the Closing subject to the terms and conditions hereof, are
not conditioned on obtaining of the Financing or any alternative Financing or on the performance of any party to any Commitment Letter.
(f)
Notwithstanding anything to the contrary in this Agreement, for all purposes of this Agreement (including the condition set forth
in Section 9.02(a) as it applies to the
Company’s
obligations under this Section 6.06), the Company’s obligations under this Section 6.06 shall be deemed satisfied
unless (A) the Company has materially breached its obligations under this Section 6.06, (B) Parent has promptly notified the Company
of such material breach and (C) such material breach substantially contributed to Parent or Merger Sub’s failure to receive any
material portion of the proceeds of the Debt Financing.
Article
7
Covenants Of Parent
Section
7.01 Conduct of Parent.
Parent shall not, and shall cause its Subsidiaries not to, from the date of this Agreement to the Effective Time, take any action or
fail to take any action that is intended to, or would reasonably be expected to, individually or in the aggregate, prevent, materially
delay or materially impede the ability of Parent and Merger Sub to consummate the Merger or the other transactions contemplated by this
Agreement, including the financing thereof; provided, however, that this Section 7.01 shall not apply to the matters covered by
Section 8.01, which shall be exclusively governed by Section 8.01.
Section
7.02 Director and Officer
Liability. Parent shall cause the Surviving Corporation, and the Surviving Corporation hereby agrees, to do the following:
(a)
For a period of six (6) years after the Effective Time, Parent shall cause the Surviving Corporation to, indemnify and hold harmless
the present and former directors and officers of the Company and its Subsidiaries and their respective successors and heirs (each, an
“Indemnified Person”) from and against any losses, damages, liabilities, costs, expenses (including attorneys’
fees), judgments, fines, penalties and amounts paid in settlement (including all interest, assessments and other charges paid or payable
in connection with or in respect of any thereof) in respect of the Indemnified Persons’ having served in such capacity prior to
the Effective Time, in each case to the fullest extent permitted by the DGCL or any other Applicable Law or provided under the Company’s
certificate of incorporation and bylaws or other organizational documents of the Company or any of its Subsidiaries in effect on the
date hereof. If any Indemnified Person is made party to any claim, action, suit, proceeding or investigation arising out of or relating
to matters that would be indemnifiable pursuant to the immediately preceding sentence, the Surviving Corporation shall (and Parent shall
cause the Surviving Corporation to), advance fees, costs and expenses (including attorneys’ fees and disbursements) as incurred
by such Indemnified Person in connection with and prior to the final disposition of such claim, action, suit, proceeding or investigation;
provided that such Indemnified Person agrees in advance to return any such funds to which a court of competent jurisdiction determines
in a final, nonappealable judgment that such Indemnified Person is not ultimately entitled to indemnification. Notwithstanding anything
to the contrary in this Agreement, Parent and the Surviving Corporation shall control any action for which indemnification may be sought
by an Indemnified Person pursuant to this Agreement, and no Indemnified Person shall settle or otherwise compromise or consent to the
entry of any judgment with respect to, or otherwise seek termination of, any such action without the Surviving Corporation’s prior
written consent. Any determination required to be made with respect to whether the conduct of any Indemnified Person complies or complied
with any applicable standard will be made by independent legal counsel selected by the Surviving Corporation (which counsel will be reasonably
acceptable to such Indemnified Person), the fees and expenses of which shall be paid by the Surviving Corporation. At its own expense,
an
Indemnified Person
may, but will not be obligated to, employ separate counsel and participate in the defense of any action involving such Indemnified Person
and so controlled by the Surviving Corporation; provided that if (i) the named parties to any such action include the Surviving Corporation
and such Indemnified Person and such Indemnified Person is advised by its own counsel that there are legal defenses available to it that
are different from or additional to those available to the Surviving Corporation or any other Indemnified Person that is party thereto,
(ii) a conflict of interest exists between such Indemnified Person and the Surviving Corporation or (iii) the Surviving Corporation and
such Indemnified Person shall have mutually agreed in writing to the retention of such counsel for such Indemnified Person, then in each
such case such Indemnified Person will be entitled to obtain its own separate counsel and the Surviving Corporation shall pay the reasonable
and documented fees and expenses of such counsel. The Surviving Corporation shall not settle any action that is indemnifiable pursuant
to this Section 7.02, except (i) with the consent of the applicable Indemnified Persons, which consent shall not be unreasonably
withheld, conditioned or delayed or (ii) if such settlement or compromise (A) includes an unconditional release thereof from all liability
arising out of such action in a form reasonably satisfactory to the applicable Indemnified Persons and (B) does not include a statement
or admissions of fault, culpability or a failure to act, by or on behalf of such Indemnified Person. No Indemnified Person will be liable
for any settlement entered into in contravention of the foregoing sentence.
(b)
For a period of six (6) years after the Effective Time, the Surviving Corporation shall (and Parent shall cause the Surviving
Corporation to) maintain in effect provisions in the certificate of incorporation, bylaws or other organizational documents of the Surviving
Corporation and its Subsidiaries (or in such documents of any successor to the business of the Surviving Corporation or any such Subsidiary)
regarding elimination of liability of directors, indemnification of directors, officers, employees, fiduciaries and agents and advancement
of fees, costs and expenses that are no less advantageous to the intended beneficiaries than the corresponding provisions in existence
on the date of this Agreement.
(c)
From and after the Effective Time, Parent shall, and shall cause the Surviving Corporation and its Subsidiaries to, honor and
comply with their respective obligations under any indemnification agreement with any Indemnified Person, and not amend, repeal or otherwise
modify any such agreement in any manner that would adversely affect any right of any Indemnified Person thereunder.
(d)
Prior to the Effective Time, the Company shall or, if the Company is unable to, the Surviving Corporation shall (and Parent shall
cause the Surviving Corporation to) as of the Effective Time to, obtain and fully pay the premium for the noncancelable extension of
the directors’ and officers’ liability coverage of the Company’s existing directors’ and officers’ insurance
policies and the Company’s existing fiduciary liability insurance policies (collectively, “D&O Insurance”),
which D&O Insurance shall (i) be for a claims reporting or discovery period of at least six (6) years from and after the Effective
Time with respect to any claim related to any period of time at or prior to the Effective Time, (ii) be from an insurance carrier with
the same or better credit rating as the Company’s current insurance carrier with respect to D&O Insurance and (iii) have terms,
conditions, retentions and limits of liability that are no less favorable than the coverage provided under the Company’s existing
policies as of the date hereof with respect to any actual or alleged error, misstatement, misleading statement, act, omission, neglect,
breach of duty or any matter claimed against an Indemnified Person by reason of his or her having served in such
capacity that existed
or occurred at or prior to the Effective Time (including in connection with this Agreement or the transactions or actions contemplated
hereby); provided that the Company shall not be permitted to pay in excess of the Cap for any such extension policy without Parent’s
prior written consent. If the Company or the Surviving Corporation for any reason fails to obtain such “tail” insurance policies
as of the Effective Time, the Surviving Corporation shall continue to maintain in effect, for a period of at least six (6) years from
and after the Effective Time, the D&O Insurance in place as of the date hereof with the Company’s current insurance carrier
or with an insurance carrier with the same or better credit rating as the Company’s current insurance carrier with respect to D&O
Insurance with terms, conditions, retentions and limits of liability that are no less favorable than the coverage provided under the
Company’s existing policies as of the date hereof, or the Surviving Corporation shall purchase from the Company’s current
insurance carrier or from an insurance carrier with the same or better credit rating as the Company’s current insurance carrier
with respect to D&O Insurance comparable D&O Insurance for such six-year period with terms, conditions, retentions and limits
of liability that are no less favorable than as provided in the Company’s existing policies as of the date hereof; provided that
in no event shall Parent or the Surviving Corporation be required to expend for such policies pursuant to this sentence a premium amount
in excess of three hundred fifty percent (350%) (the “Cap”) of the premium amount per annum for the Company’s
existing policies; and provided, further, that if the aggregate premiums of such insurance coverage exceed such amount, the Surviving
Corporation shall be obligated to obtain a policy with the greatest coverage available, with respect to matters occurring prior to the
Effective Time, for a cost not exceeding such amount.
(e)
If Parent, the Surviving Corporation or any of its successors or assigns (i) consolidates with or merges into any other Person
and is not the continuing or surviving corporation or entity of such consolidation or merger or (ii) transfers or conveys all or substantially
all of its properties and assets to any Person, then, and in each such case, to the extent necessary, proper provision shall be made
so that the successors and assigns of Parent or the Surviving Corporation, as the case may be, shall assume the obligations set forth
in this Section 7.02.
(f)
The rights of each Indemnified Person under this Section 7.02 will be in addition to any rights such Person may have under
the certificate of incorporation or bylaws of the Company or any of its Subsidiaries, under the DGCL or any other Applicable Law or under
any agreement of any Indemnified Person with the Company or any of its Subsidiaries. These rights will survive consummation of the Merger
and are intended to benefit, and shall be enforceable by, each Indemnified Person.
Section
7.03 Employee Matters.
(a)
Parent hereby acknowledges and agrees that a “Change in Control” (or similar phrase) within the meaning of the Company
Stock Plan and the ESPP containing change in control provisions will occur as of the Effective Time.
(b)
For a period commencing at the Effective Time and ending on the date that is twelve (12) months thereafter (or such earlier date
that any Continuing Employee terminates employment), Parent shall cause each employee of the Company or its Subsidiaries as of immediately
prior to the Effective Time whose employment continues as of the Effective Time (each, a “Continuing Employee”) to
receive (i) an annual rate of base salary and wages that is no
less favorable
than the annual rate of base salary and wages provided to such Continuing Employee as of immediately prior to the Effective Time, (ii)
target cash and equity incentive compensation opportunities (excluding any change in control, retention or similar payments) that are
no less favorable in the aggregate than the cash and equity incentive compensation opportunities provided to such Continuing Employee
during applicable periods prior to the Effective Time (but the form of any particular incentive compensation opportunity need not be
the same), and (iii) all other compensation and employee benefits that are substantially comparable in the aggregate to all other compensation
and employee benefits provided to such Continuing Employee as of immediately prior to the Effective Time or that are provided to similarly
situated employees of Parent or its Subsidiaries (including severance eligibility and paid time off, but excluding any defined benefit
pension and retiree medical or life insurance benefits).
(c)
Parent shall use commercially reasonable efforts to cause the Surviving Corporation and any of its respective Subsidiaries (and
any of their respective third-party insurance providers or third-party administrators) to (i) waive all limitations as to any pre-existing
condition or waiting periods with respect to participation and coverage requirements applicable to each Continuing Employee under any
employee benefit plan in which such Continuing Employees may be eligible to participate as of or after the Effective Time, to extent
pre-existing conditions and waiting periods did not apply or were satisfied under a similar Company Plan prior to the Effective Time,
and (ii) credit each Continuing Employee, as of and after the Effective Time, for any copayments, deductibles, offsets or similar payments
made under the relevant group health plan of the Company or any of its Subsidiaries during the plan year which includes the Effective
Time for purposes of satisfying any applicable copayment, deductible, offset or similar requirements under the comparable group health
plans of Parent, Merger Sub or any of their respective Subsidiaries (including the Surviving Corporation and its Subsidiaries). In addition,
as of the Effective Time, Parent shall cause the Surviving Corporation and any applicable Subsidiary to give all Continuing Employees
full credit for such Continuing Employees’ service with the Company or any of its Subsidiaries for all purposes (including eligibility,
vesting, accruals and determination of level of benefits) under any compensation and benefit plans, programs, policies, agreements and
arrangements maintained by Parent, Merger Sub or an applicable Subsidiary (including the Surviving Corporation and its Subsidiaries)
in which any Continuing Employee may be eligible to participate after the Effective Time, to the same extent and for the same purpose
that such service was credited for under any similar Company Plan immediately prior to the Effective Time, provided that such credit
for service shall not apply to the extent it would result in a duplication of benefits or compensation or for any purpose under (x) any
defined benefit pension plan or retiree medical, life insurance or other welfare benefits plan or (y) any plan that is frozen or closed
to new entrants or under which similarly situated employees of Parent and its Affiliates do not receive credit for prior service.
(d)
Without limiting the generality of Section 11.06, the provisions of this Section 7.03 are solely for the benefit
of the parties to this Agreement, and no Company Service Provider or any other individual associated therewith shall be regarded for
any purpose as a third-party beneficiary of this Section 7.03. Nothing herein shall, or shall be deemed to, (i) establish, terminate,
amend or modify any Company Plan or any other compensation or benefit plan, program, policy, agreement or arrangement maintained or sponsored
by Parent, Merger Sub, the Company or any of their respective Affiliates (including the Surviving Corporation and its
Subsidiaries);
(ii) alter or limit Parent’s, Merger Sub’s or any of their respective Affiliates’ (including the Surviving Corporation’s)
ability to establish, terminate, amend or modify any particular benefit plan, program, policy, agreement or arrangement or (iii) confer
upon any Company Service Provider any right to employment or continued employment for any period of time by reason of this Agreement,
or any right to a particular term or condition of employment.
Section
7.04 Financing Covenants.
(a)
Parent and Merger Sub shall (and shall cause their Subsidiaries to) use their reasonable best efforts to arrange and obtain the
Financing, including using their reasonable best efforts to (i) maintain in effect the Commitment Letters (subject to any amendment,
supplement, replacement, substitution, termination or other modification or waiver that is not prohibited by clause (c) below), (ii)
negotiate and enter into definitive agreements with respect thereto on the terms and conditions contained in the Commitment Letters (including,
with respect to the Debt Commitment Letter, the flex provisions) or on other terms taken as a whole, not materially less favorable to
Parent and Merger Sub, (iii) satisfy, or obtain a waiver thereof, on a timely basis all conditions to funding the Commitment Letters
and such definitive agreements related thereto, (iv) assuming that all conditions contained in the Commitment Letters have been satisfied,
consummate the Financing at or prior to the Closing and (v) enforce their rights under the Commitment Letters.
(b)
Parent shall keep the Company reasonably informed with respect to all material activity concerning the status of the Financing
contemplated by either Commitment Letter and shall give the Company notice of any material adverse change with respect to the Financing
as promptly as practicable. Parent and Merger Sub shall give the Company prompt notice (i) of the termination, repudiation, rescission,
cancellation or expiration of any Commitment Letter or the definitive agreements related to the Financing, (ii) of any breach or default
(or any event or circumstance that, with or without notice, lapse of time or both, would reasonably be expected to give rise to any breach
or default) by any party to a Commitment Letter, or any definitive agreements related to the Financing, in each case of which Parent
or Merger Sub becomes aware, (iii) of the receipt of any written notice or other written communication, in each case received from any
Debt Financing Source with respect to any (A) breach of Parent’s or Merger Sub’s (or any of their respective Subsidiaries’)
obligations under the Debt Commitment Letter or definitive agreements related to the Debt Financing, or actual or potential default,
termination or repudiation by any party to any of the Debt Commitment Letter or definitive agreements related to the Debt Financing (including
any proposal by any Debt Financing Source, lender or other Person to withdraw, terminate, repudiate, rescind or make a material change
in the terms of the Debt Commitment Letter) or (B) material dispute between or among any parties to the Debt Commitment Letter or definitive
agreements related to the Debt Financing and (iv) of the receipt of any written notice or other written communication on the basis of
which Parent expects that a party to the Financing will fail to fund the Financing or is reducing the amount of the Financing. As soon
as reasonably practicable, but in any event within three (3) Business Days of the date the Company delivers to Parent or Merger Sub a
written request, Parent and Merger Sub shall provide any information reasonably requested by the Company relating to any circumstance
referred to in clauses (i), (ii), (iii) or (iv) of the immediately preceding sentence. Notwithstanding the foregoing, in no event shall
Parent be required to share any information with the Company that is subject to
attorney-client
or other privilege; provided that Parent shall use reasonable best efforts to share as much of such information as possible in a manner
that would not violate any such privilege.
(c)
For the avoidance of doubt, Parent shall have the right from time to time to amend, supplement, replace, substitute, terminate
or otherwise modify or waive its rights under either Commitment Letter, including to (i) add lenders, lead arrangers, bookrunners, syndication
agents or similar entities who had not executed the Debt Commitment Letter as of the date of this Agreement or (ii) terminate or reduce
any commitments under either Commitment Letter in order to obtain alternative sources of financing in lieu of all or a portion of the
Financing, including in connection with a private placement of securities pursuant to Rule 144A under the Securities Act; provided that
no such amendment, supplement, replacement, substitution, termination, modification or waiver shall (A) reduce the aggregate amount of
available Financing (including by increasing the amount of fees to be paid or original issue discount (except, in the case of the Debt
Commitment Letter, as set forth in any “market flex” or “structure flex” provisions existing on the date of this
Agreement)) to less than the amount required to consummate the transactions contemplated by this Agreement (when taken together with
all cash on hand, available lines of credit and other sources of immediately available funds available to Parent), (B) impose new or
additional conditions precedent or expand upon the conditions precedent to the Debt Financing or the Equity Financing as set forth in
the existing Debt Commitment Letter or Equity Commitment Letter, as applicable, that would reasonably be expected to make the funding
of such Debt Financing or Equity Financing, as applicable, less likely to occur, (C) adversely change the timing of the funding of the
Debt Financing or Equity Financing, as applicable, thereunder in a manner that is reasonably expected to impair, delay or prevent the
availability of all or a portion of the Financing or the consummation of the transactions contemplated by this Agreement or (D) otherwise
materially adversely affect the ability of Parent to consummate the transactions contemplated by this Agreement. Parent shall furnish
to the Company a copy of any executed written amendment, supplement, replacement, substitution, termination, modification or waiver of
either Commitment Letter.
(d)
In the event that any portion of the Financing necessary for Parent to consummate the Closing becomes unavailable on the terms
and conditions contemplated by the applicable Commitment Letter (including, in the case of the Debt Commitment Letter, the flex provisions)
(other than as a result of the Company’s breach of any provision of this Agreement or failure to satisfy the conditions set forth
in Section 9.03), (i) Parent shall promptly notify the Company and (ii) Parent and Merger Sub shall use their reasonable best
efforts to (A) arrange and obtain, as promptly as practicable following the occurrence of such event, any such portion from alternative
sources (an “Alternative Financing”) on terms that (1) taken as whole, are no more adverse to Parent and Merger Sub
than such existing Commitment Letter (including, in the case of the Debt Commitment Letter, after giving effect to the market flex provisions),
(2) do not impose new or additional conditions precedent or expand upon the conditions precedent to the Financing set forth in such existing
Commitment Letter that would reasonably be expected to make the funding of such Alternative Financing less likely to occur and (3) do
not reduce the aggregate amount of available Financing to less than the amount required to consummate the transactions contemplated by
this Agreement when taken together with other available funds and (B) provide the Company with a copy of the new financing commitment
that provides for such Alternative Financing (including all related exhibits, schedules, annexes, supplements and term sheets thereto,
and including any
related fee letter, which may be redacted in a manner consistent with Section 5.09, as each of the foregoing may be amended, supplemented,
replaced, substituted, terminated or otherwise modified or waived from time to time thereafter in compliance with this Section 7.04,
the “Alternative Financing Commitment Letter”). Notwithstanding anything to the contrary contained in this Agreement,
in no event shall Parent or its Affiliates be required to pay any fees or any interest rates applicable to the Alternative Financing
in excess of those contemplated by the applicable Commitment Letter as in effect on the date hereof (including, in the case of the Debt
Commitment Letter, the market flex provisions) or agree to any term (including, in the case of the Debt Commitment Letter, any market
flex term) less favorable to Parent than such term contained in the applicable Commitment Letter as in effect on the date hereof (including,
in the case of the Debt Commitment Letter, the market flex provisions).
(e)
For purposes of this Agreement (other than with respect to representations in this Agreement made by or with respect to Parent
or Merger Sub that speak as of the date hereof or another specified date), references to the “Commitment Letters”, “Debt
Commitment Letter” or the “Equity Commitment Letter” shall include such document as permitted or required by this Section
7.04 to be amended, supplemented, replaced, substituted, terminated or otherwise modified or waived, in each case from and after
such amendment, supplement, replacement, substitution, termination or other modification or waiver and, for the avoidance of doubt, references
to “Financing”, “Debt Financing” or “Equity Financing” shall include, in whole or in part (as applicable),
any supplemental, replacement or substitute financing provided for thereunder.
Article
8
Covenants Of Parent And The Company
Section
8.01 Regulatory Undertakings.
(a)
Subject to the terms and conditions of this Agreement (including, for the avoidance of doubt, any actions taken by the Company
permitted by Section 6.02 or Section 6.04), the Company and Parent shall use reasonable best efforts to take, or cause
to be taken (including by causing their Affiliates to take), all actions (including instituting or defending any Proceeding), and to
do, or cause to be done, all things necessary, proper or advisable under Applicable Law to consummate the transactions contemplated by
this Agreement as soon as reasonably practicable (and in any event, at least five (5) Business Days prior to the End Date), including
(i) preparing and filing as promptly as reasonably practicable with any Governmental Authority or other third party all documentation
to effect all necessary, proper or advisable filings, notices, petitions, statements, registrations, submissions of information, applications
and other documents and (ii) obtaining and maintaining all approvals, consents, registrations, permits, authorizations and other confirmations
required to be obtained from any Governmental Authority or other third party that are necessary, proper or advisable to consummate the
transactions contemplated by this Agreement as soon as practicable (and in any event, at least five (5) Business Days prior to the End
Date).
(b)
In furtherance and not in limitation of the foregoing, each of the Company and Parent shall (and Parent shall cause its Affiliates
to) make an appropriate filing of a Notification and Report Form pursuant to the HSR Act with respect to the transactions contemplated
hereby with the United States Federal Trade Commission (the “FTC”) and the
Antitrust Division
of the United States Department of Justice (the “Antitrust Division”) as promptly as reasonably practicable and in
any event within five (5) Business Days after the date hereof (and such filings shall request early termination of any applicable waiting
period under the HSR Act), and furnish to the other party as promptly as practicable all information within its (or its Affiliates’)
control requested by such other party and required for such other party to make any application or other filing to be made by it pursuant
to any Applicable Law in connection with the transactions contemplated by this Agreement. Each of Parent and the Company shall respond
as promptly as practicable to any inquiries received from the FTC or the Antitrust Division or any other Governmental Authority for additional
information or documentary material that may be requested pursuant to the HSR Act or any other applicable Competition Laws and shall
use reasonable best efforts to promptly take all other actions necessary, proper or advisable to cause the expiration or termination
of the applicable waiting periods under the HSR Act and, if applicable, any other applicable Competition Laws as promptly as practicable.
(c)
If any objections are asserted with respect to the transactions contemplated by this Agreement under the HSR Act or any other
applicable Competition Law, or if any Proceeding is instituted or threatened by any Governmental Authority or Third Party challenging
any of the transactions contemplated by this Agreement, Parent and the Company shall take, or cause to be taken (including by causing
their Affiliates to take), all actions reasonably necessary to resolve such objections as promptly as practicable. Without limiting the
foregoing, in connection with any such objection or Proceeding, Parent shall, and shall cause its Subsidiaries and Affiliates to, take
any such actions as may be reasonably necessary to obtain any authorization, consent or approval of a Governmental Authority or to avoid
or eliminate any impediments under the HSR Act or any such other Competition Law so as to enable the consummation of the transactions
hereby to occur no later than the End Date, including (i) agreeing to hold separate, sell, license, divest or otherwise dispose of any
of the businesses or properties or assets of Parent, the Company or any of their respective Affiliates, (ii) terminating, amending or
assigning any existing relationships and contractual rights and obligations, (iii) terminating any venture or other arrangement, (iv)
granting any right or commercial or other accommodation to, or entering into any contractual or other commercial relationship with, any
Third Party, (v) imposing limitations on Parent, Merger Sub, the Company or any of their respective Affiliates with respect to how they
own, retain, conduct or operate all or any portion of their respective businesses or assets, (vi) effectuating any other change to, or
restructuring of, Parent, the Company or any of their respective Affiliates, (vii) opposing (A) any administrative or judicial Proceeding
that is initiated or threatened to be initiated challenging this Agreement or the consummation of the transactions contemplated hereby
(including seeking to have any stay or temporary restraining order entered by any court or other Governmental Authority vacated or reversed)
and (B) any request for, the entry of, and seek to have vacated or terminated, any Order that could reasonably be expected to restrain,
prevent or materially delay the consummation of the transactions contemplated hereby, including in the case of either (A) or (B), by
defending through litigation any Proceeding brought by any Person in any court or before any Governmental Authority, and pursuing all
available avenues of administrative and judicial appeal (and, in each case, entering into agreements with, or stipulating to the entry
of an Order by, any Governmental Authority in connection with any of the foregoing and in the case of Proceedings by or with respect
to the Company, by consenting to any such action), in each case, as may be required (x) by the applicable Governmental Authority in order
to resolve such objections as such Governmental Authority may have to such transactions
under the HSR Act
or any other Applicable Law or (y) by any domestic or foreign court or other tribunal in any Proceeding challenging such transactions
as violative of the HSR Act or any other Applicable Law, in order to avoid the entry of, or to effect the dissolution, vacating, lifting,
altering or reversal of, any Order that has the effect of restricting, preventing or prohibiting the consummation of the transactions
contemplated by this Agreement and (viii) not take any action (including entering into or consummating any contracts or arrangements
for an acquisition, however structured, of any ownership interest, assets or rights in any Person) if such action would (A) reasonably
be expected to make it materially more likely that there would arise any impediments under any antitrust, competition or trade regulation
laws or other Applicable Laws that may be asserted by the FTC, the Antitrust Division, any State Attorney General or any other Governmental
Authority to the consummation of the Merger and the other transactions contemplated hereby as promptly as practicable or (B) impose any
material delay in the expiration of any waiting period or obtaining of any approval from any Governmental Authority applicable to the
transactions contemplated by this Agreement (the actions set forth in clauses (i) through (vi) of this Section 8.01(c) referred
to collectively as, “Regulatory Actions”); provided, however, that nothing in this Section 8.01 or otherwise
in this Agreement shall require Parent or its Subsidiaries or Affiliates to (and the Company and its respective Subsidiaries and Affiliates
shall not, without Parent’s prior written consent) offer, propose, negotiate, commit or agree to, take or effect any Regulatory
Action that would be, or would reasonably be expected to be, in the aggregate, material to the Parent and its Subsidiaries (including
the Company and its Subsidiaries), taken as a whole after giving effect to the Merger, but for purposes of this Section 8.01(c),
“material” shall mean material measured on a scale relative only to the size of the Company and their respective Subsidiaries,
taken as a whole; provided, further, that a Regulatory Action shall be conditioned upon the consummation of the Merger. Solely
at the request of Parent (and for the avoidance of doubt not without prior written consent from Parent), the Company shall agree to divest,
hold separate or otherwise take or commit to take any action that limits its freedom of action with respect to, or its ability to retain,
any of the businesses, services or assets of the Company or any of its Subsidiaries; provided that any such action shall be conditioned
upon the consummation of the Merger.
(d)
Each party shall (i) promptly notify the other parties of any substantive communication to that party from the FTC, the Antitrust
Division, any State Attorney General or any other Governmental Authority regarding this Agreement or the transactions contemplated hereby
and, subject to Applicable Law, permit the other parties to review, reasonably in advance, any written communication or presentation
proposed to be submitted to any Governmental Authority with respect to the foregoing and consider in good faith any comments such other
may party may provide thereto; (ii) not agree to participate in any substantive meeting or discussion with any Governmental Authority
in respect of any filings, investigation or inquiry concerning any competition or antitrust matters in connection with this Agreement
or the Merger and the other transactions contemplated hereby unless in each case it consults with the other parties in advance and, to
the extent permitted by such Governmental Authority, gives the other parties the opportunity to attend and participate thereat; and (iii)
furnish the other parties with copies of all filings and material correspondences and communications (and memoranda setting forth the
substance thereof) between them and their Affiliates and their respective representatives, on the one hand, and any Governmental Authority
or members or their respective staffs, on the other hand, with respect to any Competition Laws in connection with this Agreement. The
parties hereto
will consult and
cooperate with one another in connection with any analyses, appearances, presentations, memoranda, briefs, arguments, opinions and proposals
made or submitted by or on behalf of any party hereto relating to proceedings under any Competition Law. Notwithstanding anything to
the contrary in this Agreement, and without limiting or expanding the rights and obligations set forth in this Section 8.01, Parent
shall have the right to direct all matters with any Governmental Authority consistent with its obligations hereunder; provided that Parent
reasonably consults with, and considers in good faith, the input of the Company; provided, further, that Parent shall not extend any
waiting period under the HSR Act or under any other Competition Law or enter into any agreement with the FTC or the Antitrust Division
or any other Governmental Authority not to consummate the transactions contemplated by this Agreement without the prior written consent
of the Company, which, in the case of the extending any such waiting period, shall not be unreasonably withheld. Any documents or other
materials provided pursuant to this Section 8.01(d) may be redacted or withheld as necessary to address reasonable privilege or
confidentiality concerns, and to remove references concerning the valuation of the Company or other competitively sensitive material,
and the Parties may, as each deems advisable, reasonably designate any material provided under this Section 8.01(d) as “outside
counsel only material.” Such “outside counsel only materials” and the information contained therein shall be given
only to legal counsel of the recipient and will not be disclosed by such legal counsel to employees, officers, or directors of the recipient
without the advance written consent of the party providing such materials.
(e)
Parent shall pay and be responsible for all fees, costs and expenses incurred in connection with the matters contemplated by this
Section 8.01.
Section
8.02 Certain Filings.
(a)
As promptly as practical following the date of this Agreement (any in any event, no later than twenty (20) Business Days after
the date of this Agreement, unless the Parties otherwise agree), the Company shall prepare (with the assistance and cooperation of Parent
as reasonably requested by the Company) and file or cause to be filed with the SEC a preliminary proxy statement relating to the Company
Stockholders Meeting (as amended or supplemented, the “Proxy Statement”).
(b)
The Company and Parent shall cooperate with one another (i) in connection with the preparation of the Proxy Statement, (ii) in
determining whether any action by or in respect of, or filing with, any Governmental Authority is required, or any actions, consents,
approvals or waivers are required to be obtained from parties to any material contracts, in connection with the consummation of the transactions
contemplated by this Agreement and (iii) in taking such actions or making any such filings, furnishing information required in connection
therewith or with the Proxy Statement and seeking timely to obtain any such actions, consents, approvals or waivers.
(c)
Each of Parent and Merger Sub shall, upon the Company’s request, promptly furnish to the Company all information concerning
itself, its Subsidiaries, directors and officers and (to the extent reasonably available to Parent or Merger Sub) such other information
concerning such Parent or Merger Sub as may be reasonably necessary or advisable in connection with any statement, filing, notice or
application made to the SEC or the NYSE in connection with the Proxy Statement. Parent and the Company shall each use reasonable best
efforts to have the
Proxy Statement
cleared by the SEC as promptly as reasonably practicable after filing. Prior to each filing of the Proxy Statement or responding to any
comments of the SEC with respect thereto, the Company shall provide Parent and its counsel a reasonable opportunity to review and comment
on such document or response (including the proposed final version of such document or response) and give reasonable and good-faith consideration
to any comments made by Parent and its counsel in connection with any such document or response. The Company shall provide Parent and
its counsel with any comments or other communications, whether written or oral, that the Company or its counsel may receive from time
to time from the SEC or its staff with respect to the Proxy Statement promptly after receipt of those comments or other communications.
None of the Company, Parent or their respective Representatives shall agree to participate in any material or substantive meeting or
conference (including by telephone) with the SEC, or any member of the staff thereof, in respect of the Proxy Statement unless it consults
with the other party in advance and, to the extent permitted by the SEC, allows the other party to participate.
(d)
The Company and Parent each agrees, as to itself and its Subsidiaries, that none of the information supplied or to be supplied
by it or its Subsidiaries for inclusion or incorporation by reference in the Proxy Statement and any amendment or supplement thereto
will, at the date of mailing to stockholders and at the times of the meeting of stockholders of the Company to be held in connection
with the Merger, contain any untrue statement of a material fact or omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances under which they were made, not misleading.
(e)
If at any time prior to the receipt of the Company Stockholder Approval, any information relating to the Company, Parent, or any
of their respective Affiliates, officers or directors, should be discovered by the Company or Parent that should be set forth in an amendment
or supplement to the Proxy Statement, so that it would not include any misstatement of a material fact or omit to state any material
fact necessary to make the statements therein, in light of the circumstances under which they were made, not misleading, the party which
discovers such information shall promptly notify the other parties and an appropriate amendment or supplement describing such information
shall promptly be prepared and filed with the SEC and, to the extent required under Applicable Law, disseminated to the stockholders
of the Company.
Section
8.03 Public Announcements.
The initial press release relating to this Agreement shall be a joint press release mutually agreed and issued by the Company and Parent.
Except in connection with the matters contemplated by Section 6.04 or in connection with any dispute between the parties regarding
this Agreement, the Merger or the other transactions contemplated hereby, Parent and the Company (a) shall consult with each other before
issuing any further press release, having any communication with the press (whether or not for attribution) or making any other public
statement (including any announcement to officers or employees of the Company or its Subsidiaries), or scheduling any press conference
or conference call with investors or analysts, with respect to this Agreement or the transactions contemplated hereby (other than any
press release, communication, public statement, press conference or conference call which has a bona fide purpose that does not
relate to this Agreement or the transactions contemplated hereby and in which this Agreement and the transactions contemplated hereby
are mentioned only incidentally and in a manner consistent with previous press releases, public disclosures or public statements made
jointly by the parties (or individually, if approved by the other party)) and (b) except in respect of any public statement or press
release as may be required by Applicable Law or any
listing agreement
with or rule of any national securities exchange or association (provided, in such case, such party has given advance notice (and
an opportunity to review and comment to the extent practicable) to the other party), shall not issue any such press release or make any
such other public statement or schedule any such press conference or conference call before such consultation. Notwithstanding the foregoing,
after the issuance of any press release or the making of any public statement with respect to which the foregoing consultation procedures
have been followed, either party may issue such additional publications or press releases and make such other customary announcements
without consulting with any other party hereto so long as such additional publications, press releases and announcements do not disclose
any nonpublic information regarding the transactions contemplated by this Agreement beyond the scope of the disclosure included in a
previous press release or public statement and such additional publications, press releases or announcements are otherwise consistent
with those with respect to which the other party had consented (or been consulted) in accordance with the terms of this Section 8.03.
Section
8.04 Merger without Meeting
of Stockholders. Parent shall take all action necessary to cause Merger Sub to perform its obligations under this Agreement and to
consummate the Merger in accordance with and subject to the terms and conditions of this Agreement. Immediately following the execution
of this Agreement, Parent, as the indirect parent of Merger Sub, shall cause the sole stockholder of Merger Sub to adopt this Agreement.
Section
8.05 Further Assurances.
At and after the Effective Time, the officers and directors of the Surviving Corporation shall be authorized to execute and deliver,
in the name and on behalf of the Company or Merger Sub, any deeds, bills of sale, assignments or assurances and to take and do, in the
name and on behalf of the Company or Merger Sub, any other actions and things to vest, perfect or confirm of record or otherwise in the
Surviving Corporation any and all right, title and interest in, to and under any of the rights, properties or assets of the Company acquired
or to be acquired by the Surviving Corporation as a result of, or in connection with, the Merger.
Section
8.06 Section 16 Matters.
Prior to the Effective Time, the Company shall take all such steps as may be required to cause any dispositions of Company Common Shares
in connection with the transactions contemplated by this Agreement (including derivative securities of such Company Common Shares) by
each individual who is subject to the reporting requirements of Section 16(a) of the 1934 Act with respect to the Company to be exempt
under Rule 16b-3 promulgated under the 1934 Act.
Section
8.07 Notices of Certain
Events. Each of the Company and Parent shall promptly notify the other of any of the following: (a) any written notice or other written
communication from any Person alleging that the consent of such Person is or may be required in connection with the transactions contemplated
by this Agreement; (b) any written notice or other written communication from any Governmental Authority in connection with the transactions
contemplated by this Agreement; and (c) any Proceedings commenced or, to its Knowledge, threatened in writing against, relating to or
involving or otherwise affecting the Company or any of its Subsidiaries or Parent or any of its Subsidiaries, as the case may be, that
relate to the consummation of the transactions contemplated by this Agreement; provided that a party’s good-faith failure to comply
with this Section 8.07 shall not constitute a breach of this Section 8.07, and shall not provide any other party
the right not to effect, or the right to terminate, the transactions
contemplated by
this Agreement, except to the extent that any other provision of this Agreement independently provides such right.
Section
8.08 Litigation and Proceedings.
The Company shall promptly notify Parent of any action brought by stockholders of the Company against the Company and/or its directors
relating to this Agreement, the Merger or the other transactions contemplated by this Agreement (whether directly or on behalf of the
Company and its Subsidiaries or otherwise). Prior to the Effective Time, the Company shall control the defense or settlement of any litigation
or other Proceedings against the Company or any of its directors relating to this Agreement, the Merger or the other transactions contemplated
by this Agreement; provided that, other than Proceedings between or among the parties hereto, the Company shall give Parent the opportunity
to consult with the Company prior to the Effective Time and keep Parent reasonably apprised on a reasonably prompt basis with respect
to the defense or settlement of any litigation or other Proceedings against the Company or any of its directors relating to this Agreement,
the Merger and the other transactions contemplated by this Agreement, including by giving Parent an opportunity to participate, at Parent’s
expense, in such litigation or other Proceedings; and provided, further, that, other than Proceedings between or among the parties hereto,
the Company agrees that it shall not settle any such litigation or other Proceedings without the prior written consent of Parent, which
shall not be unreasonably withheld, delayed or conditioned.
Section
8.09 Takeover Statutes;
Rights Agreement. If any “control share acquisition,” “fair price,” “moratorium,” “business
combination” or other similar antitakeover statute or regulation shall become applicable to the transactions contemplated by this
Agreement, each of the Company, Parent and Merger Sub and the respective members of their boards of directors shall, to the extent permitted
by Applicable Law, use reasonable best efforts to grant such approvals and to take such actions as are reasonably necessary so that the
transactions contemplated by this Agreement may be consummated as promptly as practicable on the terms contemplated herein and otherwise
to take all such other actions as are reasonably necessary to eliminate or minimize the effects of any such statute or regulation on
the transactions contemplated hereby. If any provision of the Rights Agreement shall become applicable to the transactions contemplated
by this Agreement, each of the Company and the Board of Directors shall grant such approvals and take such actions as are reasonably
necessary so that the transactions contemplated hereby may be consummated as promptly as practicable on the terms contemplated by this
Agreement and otherwise act to eliminate or minimize the effects of on the transactions contemplated hereby.
Section
8.10 Masonite Termination
Fee. Concurrently with the execution and delivery of this Agreement by the parties, (a) the Company shall terminate the Masonite
Agreement (if it has not previously been terminated) and (b) Parent shall pay or cause to be paid to the Company (or, at the direction
of the Company, to Masonite on behalf of the Company) the Company Termination Fee (as defined in the Masonite Agreement) by wire transfer
of immediately available funds, without any further liability to the Company.
Article
9
Conditions To The Merger
Section
9.01 Conditions to the Obligations
of Each Party. The obligations of the Company, Parent and Merger Sub to consummate the Merger are subject to the satisfaction of
the following conditions:
(a)
the Company Stockholder Approval shall have been obtained in accordance with the DGCL;
(b)
no Order issued by any court of competent jurisdiction or other Governmental Authority or Applicable Law prohibiting, rendering
illegal or permanently enjoining the consummation of the Merger shall be in effect; and
(c)
any applicable waiting period (including any extension thereof and any timing agreement with a Governmental Authority) under the
HSR Act relating to the Merger shall have expired or been terminated.
Section
9.02 Conditions to the Obligations
of Parent and Merger Sub. The obligations of Parent and Merger Sub to consummate the Merger are subject to the satisfaction of the
following additional conditions:
(a)
(i) the Company shall have performed and complied with in all material respects all of the covenants, obligations and agreements
hereunder required to be performed or complied with by it prior to the Closing, (ii) the representations and warranties of the Company
contained in Section 4.01(a) (Corporate Existence and Power), Section 4.02 (Corporate Authorization), Section
4.04(a) (Non-Contravention), Section 4.05(a) and (b) (Capitalization), Section 4.23 (Finders’
Fees), Section 4.24 (Opinion of Financial Advisor), Section 4.25 (Antitakeover Statutes; Rights Agreement),
and Section 4.26 (Masonite Agreement) that (A) are not qualified by Company Material Adverse Effect or other materiality
qualifiers shall be true and correct in all respects (but for de minimis inaccuracies) as of the date hereof and as of the Closing
Date as if made at and as of the Closing Date (in each case, other than representations and warranties that by their terms address matters
only as of another specified time, which shall be so true only as of such time) and (B) are qualified by Company Material Adverse Effect
or other materiality qualifiers shall be true and correct in all respects as of the date hereof and as of the Closing Date as if made
at and as of the Closing Date (in each case, other than representations and warranties that by their terms address matters only as of
another specified time, which shall be so true only as of such time) without disregarding such Company Material Adverse Effect or other
materiality qualifiers qualifications, (iii) the representations and warranties of the Company contained in Section 4.10(b) (Absence
of Certain Changes) shall be true and correct in all respects as of the date hereof and as of the Closing Date as if made at and
as of the Closing Date, (iv) the other representations and warranties of the Company contained in this Agreement (disregarding all materiality
and Company Material Adverse Effect qualifications contained therein) shall be true and correct in all respects as of the date hereof
and as of the Closing Date as if made at and as of the Closing Date (other than representations and warranties that by their terms address
matters only as of another specified time, which shall be so true only as of such time), with only such exceptions in the case of this
clause (iv) as have not had and would not reasonably be expected to
have, individually
or in the aggregate, a Company Material Adverse Effect and (v) Parent shall have received a certificate signed by an executive officer
of the Company to the effect that the conditions set forth in foregoing clauses (i) – (iv) and Section 9.02(b) have been
satisfied.
(b)
Since the date of this Agreement, no Company Material Adverse Effect shall have occurred and be continuing.
Section
9.03 Conditions to the Obligations
of the Company. The obligation of the Company to consummate the Merger is subject to the satisfaction of the following additional
conditions: (i) each of Parent and Merger Sub shall have performed and complied with in all material respects all of the covenants, obligations
and agreements hereunder required to be performed or complied with by it prior to the Closing, (ii) the representations and warranties
of Parent and Merger Sub contained in Section 5.01(a) (Corporate Existence and Power), Section
5.02 (Corporate Authorization), Section 5.04(a) (Non-Contravention), Section 5.08 (Finders’
Fees), and Section 5.10 (Solvency) that (A) are not qualified by Parent Material Adverse Effect or other materiality
qualifiers shall be true and correct in all respects (but for de minimis inaccuracies) as of the date hereof and as of the Closing
Date as if made at and as of the Closing Date (in each case, other than representations and warranties that by their terms address matters
only as of another specified time, which shall be so true only as of such time) and (B) are qualified by Parent Material Adverse Effect
or other materiality qualifiers shall be true and correct in all respects as of the date hereof and as of the Closing Date as if made
at and as of the Closing Date (in each case, other than representations and warranties that by their terms address matters only as of
another specified time, which shall be so true only as of such time) without disregarding such Parent Material Adverse Effect or other
materiality qualifiers qualifications, (iii) the other representations and warranties of Parent and Merger Sub contained in this Agreement
(disregarding all materiality and Parent Material Adverse Effect qualifications contained therein) shall be true and correct in all respects
as of the date hereof and as of the Closing Date as if made at and as of the Closing Date (other than representations and warranties
that by their terms address matters only as of another specified time, which shall be so true only as of such time), with only such exceptions
in the case of this clause (iii) as have not had and would not reasonably be expected to have, individually or in the aggregate, a Parent
Material Adverse Effect, and (iv) the Company shall have received a certificate signed by an executive officer of Parent to the effect
that the conditions set forth in foregoing clauses (i) – (iii) have been satisfied.
Article
10
Termination
Section
10.01 Termination. This Agreement may be terminated
and the Merger may be abandoned at any time prior to the Effective Time (notwithstanding any approval of this Agreement by the stockholders
of the Company):
(a)
by mutual written agreement of the Company and Parent;
(b)
by either the Company or Parent, if:
(i)
the Merger has not been consummated on or before July 16, 2025 (the “End Date”); provided that (A) if
all of the conditions set forth in Article 9 are satisfied (or,
in the case of
conditions that by their nature are to be satisfied by actions taken at the Closing, are then capable of being satisfied if the Closing
were to occur on such date) on a date that occurs on or prior to the End Date but the Closing would thereafter occur in accordance with
Section 2.01(b) on a date (the “Specified Date”) that occurs within three (3) Business Days after
the End Date, then the End Date shall automatically be extended to such Specified Date and the Specified Date shall become the End Date
for purposes of this Agreement and (B) in the event the Marketing Period has commenced on or prior to the End Date but has not completed
as of the End Date, the End Date shall be extended (or further extended) to the date that is three (3) Business Days after the then-scheduled
expiration date of the Marketing Period; provided, further, that the right to terminate this Agreement pursuant to this Section
10.01(b)(i) shall (A) not be available to any party who is in breach of, or has breached, its obligations under this Agreement, where
such breach has primarily caused or resulted in the failure of the Closing to occur on or before the End Date and (B) be subject to the
last sentence of Section 11.13 in all respects;
(ii)
there shall be any Order issued by any court or other Governmental Authority of competent jurisdiction rendering illegal or permanently
enjoining the consummation of the Merger and such Order shall have become final and nonappealable; provided that, at the time
at which such Person would otherwise exercise such termination right, the material breach by such Person (and, in the case of Parent,
Merger Sub’s) of its (or their) obligations under this Agreement has not been the primary cause of, or resulted in, the events
specified in this Section 10.01(b)(ii); or
(iii)
at the Company Stockholders Meeting (including any adjournment or postponement thereof), which shall have been duly convened and
at which a vote on the adoption of this Agreement has been taken, the Company Stockholder Approval shall not have been obtained; or
(c)
by Parent:
(i)
prior to receipt of the Company Stockholder Approval, if an Adverse Recommendation Change shall have occurred; or
(ii)
if a breach of any representation or warranty or failure to perform any covenant or agreement on the part of the Company set forth
in this Agreement shall have occurred that (A) would cause any of the conditions set forth in Section 9.02(a) not to be satisfied
and (B) is incapable of being cured or, if curable, has not been cured by the date that is twenty (20) Business Days after its receipt
of written notice thereof from Parent (or, if earlier, five (5) Business Days prior to the End Date); provided that the right
to terminate this Agreement pursuant to this Section 10.01(c)(ii) shall not be available if Parent or Merger Sub
is at such time in material breach, or if there is any inaccuracy, of any of its representations, warranties, covenants or agreements
contained in this Agreement and such breach or inaccuracy would give rise to the failure of a condition set forth in Section 9.03;
or
(d)
by the Company, if:
(i)
prior to receipt of the Company Stockholder Approval, the Board of Directors authorizes the Company to enter into a written definitive
agreement concerning a
Superior Proposal
in accordance and compliance with Section 6.04 (with such agreement being entered into substantially concurrently with the valid
termination of this Agreement); provided that concurrently with such termination, the Company pays the Company Termination Fee payable
pursuant to Section 11.04;
(ii)
a breach of any representation or warranty or failure to perform any covenant or agreement on the part of Parent or Merger Sub
set forth in this Agreement (including the performance of the first sentence of Section 8.01(b) by the applicable Affiliates of
Parent) shall have occurred (A) that would cause any of the conditions set forth in Section 9.03 not to be satisfied and (B) that
is incapable of being cured or, if curable, has not been cured by the date that is twenty (20) Business Days after its receipt of written
notice thereof from the Company (or, if earlier, five (5) Business Days prior to the End Date); provided that the right to terminate
this Agreement pursuant to this Section 10.01(d)(ii) shall not be available if the Company is at such time in material breach,
or if there is any inaccuracy, of any of its representations, warranties, covenants or agreements contained in this Agreement and such
breach or inaccuracy would give rise to the failure of a condition set forth in Section 9.02(a); or
(iii)
(A) the Closing shall not have occurred on or prior to the date required pursuant to Section 2.01(b), (B) all of the conditions
set forth in Section 9.01 and Section 9.02 have been satisfied or waived (other than those conditions that (x) by their
nature are to be satisfied by actions taken at the Closing, but which are then capable of being satisfied or (y) are not being satisfied
as a result of a breach or failure by Parent or Merger Sub of or under this Agreement), (C) the Company has confirmed in writing to Parent
(and not revoked such confirmation) at least two (2) Business Days prior to such termination that the Company stands ready, willing and
able to consummate the Closing prior to such termination, and (D) Parent has failed to consummate the Closing prior to such termination.
The
party desiring to terminate this Agreement pursuant to this Section 10.01 (other than pursuant to Section 10.01(a)) shall
give notice of such termination to the other parties specifying the provision of this Section 10.01 pursuant to which this Agreement
is being terminated.
Section
10.02 Effect of Termination. If this Agreement
is terminated pursuant to Section 10.01, this Agreement shall become void and of no effect without liability of any party to the
other parties hereto (or any stockholder, director, officer, employee, agent, consultant or representative of such party); provided
that, subject to Section 11.04(c) and Section 11.04(d) in all respects, no party shall be relieved of liability to
the extent such termination shall result from the fraud or any material and willful breach of this Agreement by a party prior to termination,
and in each such case, such party shall be fully liable for any and all liabilities and damages that were incurred or suffered by the
other parties as a result of such failure or breach. The Confidentiality Agreement and the Clean Team Agreement and the provisions of
this Section 10.02, Section 6.03(b), Section 8.03 and Article 11 shall survive any termination hereof pursuant
to Section 10.01.
Article
11
Miscellaneous
Section
11.01 Notices. All notices, requests and other
communications to any party hereunder shall be in writing (including e-mail, so long as a receipt of such e-mail is requested and received)
and shall be given,
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if to Parent or Merger Sub, to: |
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MIWD Holding Company LLC
2550 Industrial Drive
Suite 400
Harrisburg, PA 17030 |
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Attention: |
General Counsel |
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E-mail: |
robert.reed@miwd.com |
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with a copy, which shall not constitute notice, to: |
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Stinson LLP
1201 Walnut Street, Suite 2900
Kansas City, Missouri 64106 |
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Attention: |
Jack Bowling
Patrick Respeliers |
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Email: |
jack.bowling@stinson.com
patrick.respeliers@stinson.com |
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if to the Company, to: |
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PGT Innovations, Inc.
1070 Technology Drive
North Venice, FL |
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Attention: |
Ryan Quinn |
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Email: |
RQuinn@pgtinnovations.com |
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with copies, which shall not constitute notice, to: |
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Davis Polk & Wardwell LLP
450 Lexington Avenue
New York, New York 10017 |
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Attention: |
John Amorosi
Evan Rosen |
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Email: |
john.amorosi@davispolk.com
evan.rosen@davispolk.com |
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or to such other
address or e-mail address as such party may hereafter specify for the purpose by notice to the other parties hereto. All such notices,
requests and other communications shall be deemed received on the date of receipt by the recipient thereof if received prior to 5:00
p.m. New
York City time
on a business day in the place of receipt. Otherwise, any such notice, request or communication shall be deemed to have been received
on the next succeeding business day in the place of receipt.
Section
11.02 No Survival of Representations and Warranties.
The representations and warranties contained herein and in any certificate or other writing delivered pursuant hereto shall not survive
the Effective Time.
Section
11.03 Amendments and Waivers.
(a)
Subject to Section 11.14, any provision of this Agreement may be amended or waived prior to the Effective Time if, but
only if, such amendment or waiver is in writing and is signed, in the case of an amendment, by each party to this Agreement or, in the
case of a waiver, by each party against whom the waiver is to be effective; provided that, after the Company Stockholder Approval has
been obtained, there shall be no amendment or waiver that would require the further approval of the stockholders of the Company under
the DGCL without such approval having first been obtained.
(b)
No failure or delay by any party in exercising any right, power or privilege hereunder shall operate as a waiver thereof nor shall
any single or partial exercise thereof preclude any other or further exercise thereof or the exercise of any other right, power or privilege.
The rights and remedies herein provided shall be cumulative and not exclusive of any rights or remedies provided by Applicable Law.
Section
11.04 Expenses.
(a)
General. Except as otherwise expressly provided herein, all costs and expenses incurred in connection with this Agreement
shall be paid by the party incurring such cost or expense.
(b)
Termination Fee.
(i)
If this Agreement is validly terminated by the Company pursuant to Section 10.01(d)(i) (Superior Proposal) to enter
into a written definitive agreement with a Third Party or by Parent pursuant to Section 10.01(c)(i) (Adverse Recommendation
Change), the Company shall pay or cause to be paid to Parent in immediately available funds $86,000,000 (in each case, such fee,
the “Company Termination Fee”), in the case of a termination by Parent, within two (2) Business Days after such termination
and, in the case of a termination by the Company, immediately before and as a condition to such termination.
(ii)
If, (A) this Agreement is validly terminated by (1) Parent or the Company pursuant to (x) Section 10.01(b)(i) (End Date)
and at the time of such termination the Company Stockholder Approval has not been received or (y) Section 10.01(b)(iii) (Company
No Vote) or (2) by Parent pursuant to Section 10.01(c)(ii) (Company Breach), (B) following the execution and delivery
of this Agreement and prior to such valid termination of this Agreement, a bona fide Acquisition Proposal shall have been publicly
announced or publicly disclosed and not publicly withdrawn or otherwise abandoned at least two (2) Business Days prior to such
termination of
this Agreement and (C) within twelve (12) months following such valid termination of this Agreement, either an Acquisition Proposal is
consummated or the Company enters into a definitive agreement providing for the consummation of an Acquisition Proposal, then the Company
shall concurrently with such consummation or entry into a definitive agreement, pay, or cause to be paid, to Parent the Company Termination
Fee by wire transfer of immediately available funds to an account or accounts designated in writing by Parent. For purposes of this Section
11.04(b)(ii), all references to “twenty percent (20%)” in the definition of “Acquisition Proposal” shall
be deemed to be references to “fifty percent (50%)”.
(iii)
If this Agreement is validly terminated (A) by the Company pursuant to Section 10.01(d)(ii) (Parent Breach) or Section
10.01(d)(iii) (Parent Failure to Close) or (B) by the Company or Parent pursuant to Section 10.01(b)(i) (End Date)
at a time when this Agreement is terminable pursuant to Section 10.01(d)(ii) (Parent Breach) or Section 10.01(d)(iii)
(Parent Failure to Close), then Parent shall, within three (3) Business Days following any such termination, pay to the Company,
in cash by wire transfer of immediately available funds to the account designated in writing by the Company, $184,000,000 (such fee,
the “Parent Termination Fee”).
(iv)
If this Agreement is terminated by Parent or the Company pursuant to (i) (A) Section 10.01(b)(i)
(End Date) and, at the time of such termination, the conditions set forth in Section
9.01(b) (in connection with the matters that are the subject of Section 8.01) or Section 9.01(c)
shall not have been satisfied or (B) Section 10.01(b)(ii) (Order) (in connection with the
matters that are the subject of Section 8.01), and at the time of such termination referred to in clause (A) or (B) above, the
conditions set forth in Section 9.02(a) shall have been satisfied. other than conditions that by their nature are to be satisfied
at the Closing (assuming for the purpose of determining whether the conditions set forth in Section 9.02(a)
have been satisfied in this clause, that all references to “Closing” or “Closing Date” in
Section 9.02(a) shall be deemed to refer instead to the time of termination of this Agreement) or waived in accordance
with this Agreement or (ii) Section 10.01(d)(ii) (Parent Breach) (in connection with the matters that are the subject of
Section 8.01), then Parent shall, within three (3) Business Days following any such termination, pay to the Company, in cash by
wire transfer of immediately available funds to the account designated in writing by the Company, $221,000,000 (such fee, the “Parent
Regulatory Termination Fee”). If this Agreement is terminated in circumstances where both the Parent Termination Fee would
be payable pursuant to Section 11.04(b)(iii) and the Parent Regulatory Termination Fee would be payable pursuant to Section
11.04(b)(iv), then the Parent Termination Fee shall be deemed not to be payable and only the Parent Regulatory Termination Fee shall
be payable.
(c)
Each party agrees that (i) the agreements contained in this Section 11.04 are an integral part of the transactions contemplated
by this Agreement and that, without these agreements, the other parties would not enter into this Agreement and (ii) in light of the
difficulty of accurately determining actual damages with respect to the foregoing, the right to payment of the Company Termination Fee,
the Parent Termination Fee or the Parent Regulatory Termination Fee, as applicable, constitutes a reasonable estimate of the losses,
damages, claims, costs or expenses that will be suffered by reason of any such valid termination of this Agreement and constitutes liquidated
damages (and not a penalty) (and that neither such amount is excessive or unreasonably large, given the parties’ intent and dealings
with each other) and hereby irrevocably
waives, and agrees
not to assert in any Proceeding arising out of or relating to this Agreement, any claim to the contrary.
(d)
Notwithstanding anything herein to the contrary (but subject to Section 11.04(e)), (i) Parent and Merger Sub agree that,
except in the case of fraud or any material and willful breach of this Agreement by the Company, upon any valid termination of this Agreement
under circumstances where the Company Termination Fee is payable by the Company pursuant to this Section 11.04 and such Company
Termination Fee is paid in full, the receipt by Parent of the Company Termination Fee shall be deemed to be liquidated damages and the
sole and exclusive remedy of Parent and Merger Sub in connection with this Agreement or the transactions contemplated hereby and neither
Parent nor Merger Sub shall seek to obtain any recovery, judgment, or damages of any kind, including consequential, indirect, or punitive
damages, against the Company or any of the Company’s Subsidiaries or any of their respective directors, officers, employees, partners,
managers, members, stockholders, Affiliates or Representatives in connection with this Agreement or the transactions contemplated hereby,
including any breach of this Agreement and (ii) the Company agrees that, except in the case of fraud or any material and willful breach
of this Agreement by Parent or Merger Sub, upon any valid termination of this Agreement under circumstances where the Parent Termination
Fee or the Parent Regulatory Termination Fee is payable by Parent pursuant to this Section 11.04 and such fee is paid in full,
the receipt by the Company of such fee shall be deemed to be liquidated damages and the sole and exclusive remedy of the Company in connection
with this Agreement or the transactions contemplated hereby and the Company shall not seek to obtain any recovery, judgment, or damages
of any kind, including consequential, indirect, or punitive damages, against Parent or any of Parent’s Subsidiaries, any of their
respective directors, officers, employees, partners, managers, members, stockholders, Affiliates or Representatives or any of the Financing
Sources Related Parties in connection with this Agreement or the transactions contemplated hereby. Each party acknowledges and agrees
that in no event shall the Company or Parent, as applicable, be required to pay the Company Termination Fee or the Parent Termination
Fee or the Parent Regulatory Termination Fee, as applicable, on more than one occasion. For the avoidance of doubt, nothing in this Section
11.04(d) shall limit any remedies of Parent or the Company prior to any such valid termination of this Agreement under circumstances
where the Company Termination Fee, the Parent Termination Fee or the Parent Regulatory Termination Fee is payable pursuant to this Section
11.04, including specific performance pursuant to Section 11.13. In no event will any Party be entitled to receive both (x)
a grant of specific performance which results in the consummation of the Closing as contemplated in this Agreement and (y) payment of
the Company Termination Fee, the Parent Termination Fee or the Parent Regulatory Termination Fee, as applicable.
(e) If
the Company or Parent fails to promptly pay any amount due pursuant to this Section 11.04 and, in order to obtain such
payment, Parent or the Company, as applicable, commences a Proceeding that results in a judgment against the other for such amount
or any portion thereof, the responsible party will pay the other its reasonable out-of-pocket fees, costs and expenses (including
reasonable attorneys’ fees) in connection with such Proceeding, together with interest on such amount due or portion thereof
at the annual rate of five percent (5%) plus the prime rate as published in The Wall Street Journal in effect on the date
that such payment or portion thereof was required to be made through the date that such payment or portion thereof was actually
received, or a lesser rate that is the maximum permitted by Applicable Law.
Section
11.05 Disclosure Schedule and SEC Document References. The
parties hereto agree that any reference in a particular section of the Company Disclosure Schedule or Parent Disclosure Schedule shall
be deemed to be an exception to (or, as applicable, a disclosure for purposes of) (a) the representations and warranties (or covenants,
as applicable) of the Company or either Parent or Merger Sub, as applicable, that are contained in the corresponding section of this
Agreement and (b) any other representations and warranties (or covenants, as applicable) of the Company or either Parent or Merger Sub,
as applicable, that are contained in this Agreement, but only if the relevance of that reference as an exception to (or a disclosure
for purposes of) such representations and warranties (or covenants, as applicable) is reasonably apparent on its face. The mere inclusion
of an item in the Company Disclosure Schedule or Parent Disclosure Schedule will not be deemed an admission that such item represents
a material exception or material fact, event or circumstance or that such item has had or would reasonably be expected to have a Company
Material Adverse Effect or Parent Material Adverse Effect, and the disclosure therein of any allegations with respect to any alleged
breach, violation or default under any contractual or other obligation, or any law, is not an admission that such breach, violation or
default has occurred. Headings and subheadings have been inserted in certain sections of the Company Disclosure Schedule and Parent Disclosure
Schedule for convenience of reference only and will not be considered a part of or affect the construction or interpretation of such
sections. The information provided in the Company Disclosure Schedule or Parent Disclosure Schedule is being provided solely for the
purpose of making disclosures under this Agreement. In disclosing such information, the disclosing party does not waive, and expressly
reserves any rights under, any attorney-client privilege associated with such information or any protection afforded by the work-product
doctrine with respect to any of the matters disclosed or discussed therein.
Section
11.06 Binding Effect; Third Party Beneficiaries;
Assignment.
(a)
Subject to Section 11.06(b), the provisions of this Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and assigns and no provision of this Agreement is intended to confer any rights, benefits,
remedies, obligations or liabilities hereunder upon any Person other than the parties hereto and their respective successors and assigns,
other than: (i) with respect to the provision of Section 7.02, which shall insure to the benefit of the Persons benefiting therefrom
who are intended to be third-party beneficiaries thereof; (ii) the right of any holders of Company Common Shares, Company Restricted
Shares and Company RSUs to receive the Merger Consideration following the Effective Time in accordance with, and subject to, the terms
and conditions of this Agreement (including Section 11.04(d)); and (iii) the right of the Company, on behalf of the holders of
Company Common Shares, Company Restricted Shares and Company RSUs, (each of which are third party beneficiaries of this Agreement to
the extent required for this clause (iii) to be enforceable), to pursue specific performance as set forth in Section 11.13 or,
if specific performance is not sought or granted as a remedy, damages (which damages the parties acknowledge and agree will not be limited
to reimbursement of expenses or out of pocket costs and may include the benefit of the bargain lost by such holders (including the premium
reflected in the Merger Consideration, which was specifically negotiated by the Board of Directors on behalf of such holders and taking
into consideration all other relevant matters)) in the event of a breach hereof by Parent of this Agreement, it being agreed that in
no event shall any such holder be entitled to enforce any of their rights, or any of Parent’s or Merger Sub’s obligations,
under this Agreement in the event of any
such breach, but
rather the Company shall have the sole and exclusive right to do so, as agent for such holders.
(b)
No party may assign, delegate or otherwise transfer any of its rights or obligations under this Agreement without the consent
of each other party hereto; provided that either Parent and Merger Sub may transfer or assign its rights and obligations under this Agreement,
in whole or from time to time in part, to (i) another wholly owned direct or indirect Subsidiary of Parent or (ii) after the Effective
Time, to any Person (provided that, in each case, no such assignment shall relieve Parent or Merger Sub of its obligations under this
Agreement or enlarge, alter or change any obligation of any party hereto or due to Parent or Merger Sub). Any purported assignment, delegation
or other transfer without such consent or otherwise consistent with the foregoing sentence shall be void.
Section
11.07 Governing Law. This Agreement shall be
governed by and construed in accordance with the laws of the State of Delaware, without regard to the conflicts of law rules or other
rules that would result in the application of the laws of a different jurisdiction. Any and all claims, controversies, causes of action,
or other Proceedings arising out or relating to this Agreement, whether sounding in contract, tort, or statute, shall be governed by
the laws of the State of Delaware, without giving effect to any conflicts of law rules or other rules that would result in the application
of the laws of a different jurisdiction.
Section
11.08 Jurisdiction. The parties hereto agree
that any Proceeding seeking to enforce any provision of, relating to, or in connection with, this Agreement shall be brought exclusively
in the Delaware Chancery Court or, if such court shall not have or declines jurisdiction, any federal court or other Delaware state courts,
in each case, located in New Castle County in the State of Delaware (collectively, the “Chosen Courts”), and each
of the parties hereby irrevocably consents and submits to the exclusive jurisdiction of such Chosen Courts (and of the appropriate appellate
courts therefrom) in any such Proceeding and irrevocably waives, to the fullest extent permitted by Applicable Law, any objection that
it may now or hereafter have to the laying of the venue of any such Proceeding in any such Chosen Court or that any such Proceeding brought
in any such Chosen Court has been brought in an inconvenient forum. Process in any such Proceeding may be served on any party anywhere
in the world, whether within or without the jurisdiction of any such court. Without limiting the foregoing, each party agrees that service
of process on such party as provided in Section 11.01 shall be deemed effective service of process on such party.
Section
11.09 WAIVER OF JURY TRIAL. EACH OF THE PARTIES
HERETO ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY THAT MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND DIFFICULT
ISSUES, AND THEREFORE, EACH PARTY HERETO HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY AND ALL RIGHT SUCH PARTY MAY HAVE TO A TRIAL
BY JURY IN ANY PROCEEDING ARISING OUT OF, RELATED TO, OR IN CONNECTION WITH THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY. EACH
PARTY HERETO CERTIFIES AND ACKNOWLEDGES THAT (A) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY OTHER PARTY HERETO HAS REPRESENTED, EXPRESSLY
OR OTHERWISE, THAT SUCH OTHER PARTY WOULD NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (B) SUCH PARTY UNDERSTANDS
AND HAS CONSIDERED THE IMPLICATIONS OF
THIS WAIVER, (C)
SUCH PARTY MAKES THIS WAIVER VOLUNTARILY AND (D) SUCH PARTY HAS BEEN INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE
MUTUAL WAIVERS AND CERTIFICATIONS IN THIS SECTION 11.09.
Section
11.10 Counterparts; Effectiveness. This Agreement
may be signed in any number of counterparts, each of which shall be an original, with the same effect as if the signatures thereto and
hereto were upon the same instrument. This Agreement shall become effective when each party hereto shall have received a counterpart
hereof signed by all of the other parties hereto. Until and unless each party has received a counterpart hereof signed by each other
party hereto, this Agreement shall have no effect and no party shall have any right or obligation hereunder (whether by virtue of any
other oral or written definitive agreement or other communication). The exchange of a fully executed Agreement (in counterparts or otherwise)
by electronic transmission in .pdf or DocuSign format shall be sufficient to bind the parties to the terms and conditions of this Agreement.
Section
11.11 Entire Agreement. This Agreement, the
Confidentiality Agreement and the Clean Team Agreement constitute the entire agreement between the parties with respect to the subject
matter of this Agreement and supersede all prior agreements and understandings, both oral and written, between the parties with respect
to the subject matter of this Agreement.
Section
11.12 Severability. If any term, provision,
covenant or restriction of this Agreement is held by a court of competent jurisdiction or other Governmental Authority to be invalid,
void or unenforceable, the remainder of the terms, provisions, covenants and restrictions of this Agreement shall remain in full force
and effect and shall in no way be affected, impaired or invalidated so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner materially adverse to any party. Upon such a determination, the parties shall negotiate in good
faith to modify this Agreement so as to effect the original intent of the parties as closely as possible in an acceptable manner in order
that the transactions contemplated hereby be consummated as originally contemplated to the fullest extent possible.
Section
11.13 Specific Performance. The parties hereto
agree that irreparable damage would occur if any provision of this Agreement were not performed in accordance with its terms, and that
monetary damages, even if available, would not be an adequate remedy therefor. Accordingly, the parties hereto agree that the parties
shall be entitled to an injunction or injunctions, or any other appropriate form of equitable relief, to prevent or restrain breaches
or threatened breaches of this Agreement or to enforce specifically the performance of the terms and provisions hereof, without the necessity
of proving that irreparable damage would occur or the inadequacy of money damages as a remedy (and each party hereby waives any requirement
for the securing or posting of any bond in connection with such remedy), in addition to any other remedy to which they are entitled at
law or in equity. The parties hereto hereby waive any defense, and agree not to assert (or interpose as a defense or in opposition),
that a remedy of specific performance or other equitable relief is unenforceable, invalid, contrary to law or inequitable for any
reason, that a remedy of monetary damages would provide an adequate remedy or that the parties otherwise have an adequate remedy at law.
Notwithstanding anything herein to the contrary, if, prior to the End Date, any party brings any suit, action or proceeding to enforce
specifically the performance of the terms and provisions hereof by any other party, the End Date shall automatically be extended by the
amount of time during which such suit, action or proceeding
is pending, plus
five (5) Business Days, or such longer time period established by the court presiding over such suit, action or proceeding, if any.
Section
11.14 Financing Sources. Notwithstanding anything
in this Agreement to the contrary, the Company and Parent, on behalf of themselves and their Subsidiaries, hereby: (i) (x) agree that
any action, whether in law or in equity, whether in contract or in tort or otherwise, involving any Financing Sources Related Party,
arising out of or relating to, this Agreement, the Financing or any of the agreements entered into in connection with the Financing or
any of the transactions contemplated hereby or thereby or the performance of any services thereunder shall be subject to the exclusive
jurisdiction of any federal or state court in the Borough of Manhattan, New York, New York, so long as such forum is and remains available,
and any appellate court thereof and (y) irrevocably submits itself and its property with respect to any such action to the exclusive
jurisdiction of such court, and such action (except to the extent relating to the interpretation of any provisions in this Agreement
(including any provision in any documentation related to the Financing that expressly specifies that the interpretation of such provisions
shall be governed by and construed in accordance with the law of the State of New York)) shall be governed by the laws of the State of
New York (without giving effect to any conflicts of law principles that would result in the application of the laws of another jurisdiction),
(ii) agree not to bring or support, or permit any of their Affiliates to bring or support any action of any kind or description, whether
in law or in equity, whether in contract or in tort or otherwise, against any Financing Sources Related Party in any way arising out
of or relating to, this Agreement, the Financing or any of the transactions contemplated hereby or thereby or the performance of any
services thereunder in any forum other than any federal or state court in the Borough of Manhattan, New York, New York, (iii) agree that
service of process upon the Company or Parent, or any of their Subsidiaries in any such action or proceeding shall be effective if notice
is given in accordance with Section 11.01, (iv) waive, to the fullest extent that it may effectively do so, the defense of an
inconvenient forum to the maintenance of such action in any such court, (v) waive, to the fullest extent permitted by applicable law,
all rights of trial by jury in any action brought against the Financing Sources Related Parties in any way arising out of or relating
to this Agreement, the Financing or any of the transactions contemplated hereby or thereby or the performance of any services thereunder,
(vi) agree that no Financing Sources Related Party will have any liability to the Company or any of its Subsidiaries in connection with
this Agreement, the Financing or any of the transactions contemplated hereby or thereby or the performance of any services thereunder,
whether in law or in equity, whether in contract or in tort or otherwise (provided that, notwithstanding the foregoing, nothing herein
shall affect the rights of Parent against the Financing Sources Related Parties with respect to the Financing or any of the transactions
contemplated hereby or any services thereunder) and (vii) agree that (x) the Financing Sources Related Parties are express third party
beneficiaries of, and may enforce, the foregoing agreements in Section 11.04(d) (solely to the extent that it relates to the Financing
Sources) and this Section 11.14 and (y) such provisions (and any other provision of this Agreement to the extent an amendment,
supplement, waiver or other modification of such provision would modify the substance of this Section 11.14) shall not be amended
in any way materially adverse to any Financing Source Related Parties without the prior written consent of each related Debt Financing
Source party to the Debt Commitment Letter at such time or Equity Financing Source, as applicable. This Section 11.14 will, with
respect to the matters referenced herein, supersede any
provisions of this
Agreement to the contrary. The provisions of this Section 11.14 will survive any termination of this Agreement.
[The remainder
of this page has been intentionally left blank;
the next page is the signature page.]
IN
WITNESS WHEREOF, the parties hereto have caused this Agreement to be duly executed by their respective authorized officers as of the
date set forth on the cover page of this Agreement.
PGT INNOVATIONS, INC. |
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Jeffrey T. Jackson |
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President and CEO |
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[Signature Page to Merger Agreement]
MIWD HOLDING COMPANY LLC |
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By: |
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Name: |
Matt DeSoto |
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Title: |
President and CEO |
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RMR MERGECO, INC. |
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By: |
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Matt DeSoto |
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President and CEO |
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[Signature Page to Merger Agreement]
EXECUTION
VERSION
Exhibit A
Certificate of Incorporation of Surviving Corporation
EXHIBIT A
FORM OF CERTIFICATE OF INCORPORATION OF THE SURVIVING CORPORATION
AMENDED AND RESTATED CERTIFICATE OF INCORPORATION OF
[_], INC.
Article
I
The
name of the corporation (which is hereinafter referred to as the “Corporation”) is: [_], Inc.
Article
II
The
address of the Corporation’s registered office in the State of Delaware is 1209 Orange Street, City of Wilmington, County of New
Castle, 19801. The name of the Corporation’s registered agent at such address is The Corporation Trust Company.
Article
III
The
purpose of the Corporation shall be to engage in any lawful act or activity for which corporations may be organized and incorporated
under the General Corporation Law of the State of Delaware (the “DGCL”).
Article
IV
Section
1.
The Corporation shall be authorized to issue 1,000 shares of capital stock, of which 1,000 shares shall be shares of Common Stock,
par value $0.01 per share (“Common Stock”).
Section
2.
Except as otherwise provided by law, the Common Stock shall have the exclusive right to vote for the election of directors and
for all other purposes. Each share of Common Stock shall have one vote, and the Common Stock shall vote together as a single class.
Article
V
Unless
and except to the extent that the By-Laws of the Corporation shall so require, the election of directors of the Corporation need not
be by written ballot.
Article
VI
In
furtherance and not in limitation of the powers conferred by law, the Board of Directors of the Corporation (the “Board”)
is expressly authorized and empowered to make, alter and repeal the By-Laws of the Corporation at any regular or special meeting of the
Board or by written consent, subject to the power of the stockholders of the Corporation to alter or repeal any By-Laws made by the Board.
Article
VII
The
Corporation reserves the right at any time from time to time to amend, alter, change or repeal any provision contained in this Certificate
of Incorporation, and any other provisions authorized by the laws of the State of Delaware at the time in force to be added or inserted,
in the manner now or hereafter prescribed by law; and all rights, preferences and privileges of whatsoever nature conferred upon stockholders,
directors or any other persons whomsoever by and pursuant to this Certificate of Incorporation in its present form or as hereafter amended
are granted subject to the right reserved in this Article VII.
Article
VIII
Section
1.
Elimination of Certain Liability of Directors. To the fullest extent permitted by the DGCL, as the same exists or may hereafter
be amended, a director or officer, as applicable, of the Corporation shall not be personally liable either to the Corporation or to any
of its stockholders for monetary damages for breach of fiduciary duty as a director or officer, as applicable. Any amendment, modification
or repeal of the foregoing sentence will be prospective only and shall not adversely affect any right or protection of a director or
officer, as applicable, of the Corporation hereunder in respect of any act or omission occurring prior to the time of such amendment,
modification or repeal. If the DGCL hereafter is amended to further eliminate or limit the liability of a director or officer, then a
director or officer, as applicable, of the Corporation, in addition to the circumstances in which a director or officer, as applicable,
is not personally liable as set forth in the preceding sentence, shall not be liable to the fullest extent permitted by the amended DCGL.
For purposes of this Article VIII, “director” and “officer” shall have the meanings provided in Section
102(b)(7) of the DGCL as they presently exists or as they may hereafter be amended, supplemented or replaced.
Section
2.
Indemnification and Advance of Expenses.
(a)
Right to Indemnification. To the fullest extent permitted by Delaware law, as the same exists or may hereafter be amended, the
Corporation shall indemnify and hold harmless each person who is or was made a party or is threatened to be made a party to or is otherwise
involved in any threatened, pending or completed action, suit or proceeding, whether civil, criminal, administrative or investigative,
including an action by or in the right of the Corporation to procure a judgment in its favor (each, a “proceeding”),
by reason of the fact that he or she is or was a director or officer of the Corporation or, while a director or officer of the Corporation,
is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership,
joint venture, trust, other enterprise or nonprofit entity, including service with respect to an employee benefit plan (an “indemnitee”),
whether the basis of such proceeding is alleged action in an official capacity as a director, officer, employee or agent, or in any other
capacity while serving as a director, officer, employee or agent, against all liability and loss suffered and expenses (including, without
limitation, attorneys’ fees and disbursements, judgments, fines, ERISA excise taxes, damages, claims and penalties and amounts
paid in settlement) reasonably incurred by such indemnitee in connection with such proceeding. Such right to indemnification shall inure
to the benefit of any such person’s heirs, executors, and personal and legal representatives. The termination of any action, suit
or proceeding by judgment, order, settlement, conviction, or upon a plea of nolo contendere or its equivalent, shall not, of itself,
create
a presumption that
the person did not act in good faith and in a manner which such person reasonably believed to be in or not opposed to the best interests
of the Corporation, and, with respect to any criminal action or proceeding, had reasonable cause to believe that such person’s
conduct was unlawful. The Corporation shall to the fullest extent not prohibited by applicable law pay the expenses (including attorneys’
fees) incurred by an indemnitee in defending or otherwise participating in any proceeding in advance of its final disposition; provided,
however, that, to the extent required by applicable law, such payment of expenses in advance of the final disposition of the proceeding
shall be made only upon receipt of an undertaking, by or on behalf of the indemnitee, to repay all amounts so advanced if it shall ultimately
be determined that the indemnitee is not entitled to be indemnified under this Section 2 of this Article VIII or otherwise. The
rights to indemnification and advancement of expenses conferred by this Section 2 of this Article VIII shall be contract rights
and such rights shall continue as to an indemnitee who has ceased to be a director, officer, employee or agent and shall inure to the
benefit of his or her heirs, executors and administrators. Notwithstanding the foregoing provisions of this Section 2(a) of this Article
VIII, except for proceedings to enforce rights to indemnification and advancement of expenses, the Corporation shall indemnify and
advance expenses to an indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee only if such proceeding
(or part thereof) was authorized by the Board.
(b)
Assumption of Good Faith. For purposes of any determination under Section 2(a) of this Article VIII, a person shall
be deemed to have acted in good faith and in a manner such person reasonably believed to be in or not opposed to the best interests of
the Corporation, or, with respect to any criminal action or proceeding, to have had no reasonable cause to believe such person’s
conduct was unlawful, if such person’s action is based on the records or books of account of the Corporation or another enterprise,
or on information supplied to such person by the officers of the Corporation or another enterprise in the course of their duties, or
on the advice of legal counsel for the Corporation or another enterprise or on information or records given or reports made to the Corporation
or another enterprise by an independent certified public accountant or by an appraiser or other expert selected with reasonable care
by the Corporation or another enterprise. The provisions of this Section 2(b) shall not be deemed to be exclusive or to limit in any
way the circumstances in which a person may be deemed to have met the applicable standard of conduct set forth in Section 2(a) of this
Article VIII.
(c)
Non-Exclusivity of Rights. The rights to indemnification and advancement of expenses conferred on any indemnitee by this
Section 2 of this Article VIII shall not be exclusive of any other rights that any indemnitee may have or hereafter acquire under
law, this Amended and Restated Certificate, the Bylaws, an agreement, vote of stockholders or disinterested directors, or otherwise.
Notwithstanding any contrary determination in the specific case under Section 2(a) of this Article VIII, and notwithstanding the
absence of any determination thereunder, any director or officer may apply to the Court of Chancery of the State of Delaware or any other
court of competent jurisdiction in the State of Delaware for indemnification to the extent otherwise permissible under Section 2(a) of
this Article VIII. The basis of such indemnification by a court shall be a determination by such court that indemnification of
the director or officer is proper in the circumstances because such person has met the applicable standard of conduct set forth in Section
2(a) of this Article VIII. Neither a contrary determination in the specific case under Section 2(a) of this Article VIII
nor the absence of any determination thereunder shall be a defense to such
application or
create a presumption that the director or officer seeking indemnification has not met any applicable standard of conduct. Notice of any
application for indemnification pursuant to this Section 2(c) shall be given to the Corporation promptly upon the filing of such application.
If successful, in whole or in part, the director or officer seeking indemnification shall also be entitled to be paid the expense of
prosecuting such application.
(d)
Repeal; Amendment. Any repeal or amendment of this Article VIII by the stockholders of the Corporation or by changes
in law, or the adoption of any other provision of this Amended and Restated Certificate inconsistent with this Section 2 of this Article
VIII, shall, unless otherwise required by law, be prospective only (except to the extent such amendment or change in law permits
the Corporation to provide broader indemnification rights on a retroactive basis than permitted prior thereto), and shall not in any
way diminish or adversely affect any right or protection existing at the time of such repeal or amendment or adoption of such inconsistent
provision in respect of any proceeding (regardless of when such proceeding is first threatened, commenced or completed) arising out of,
or related to, any act or omission occurring prior to such repeal or amendment or adoption of such inconsistent provision.
(e)
No Limitation. Section 2 of this Article VIII shall not limit the right of the Corporation, to the extent and in
the manner authorized or permitted by law, to indemnify and to advance expenses to persons other than indemnitees.
(f)
Insurance. The Corporation shall have power to purchase and maintain insurance on behalf of any person who is or was a
director, officer, employee or agent of the Corporation, or is or was serving at the request of the Corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, employee benefit plan trust or other enterprise, against any liability
asserted against such person and incurred by such person in any such capacity, or arising out of such person’s status as such,
whether or not the Corporation would have the power to indemnify such person against such liability under the provisions of this Section
2 of this Article VIII or otherwise.
Exhibit B
Company Organizational Document Amendment
The Amended and
Restated Certificate of Incorporation of the Company is hereby amended to add a new Article FIFTEENTH as follows:
FIFTEENTH: To the
fullest extent permitted by law, (i) the Corporation is designated as the stockholders’ sole and exclusive agent with the exclusive
right to pursue and recover any remedies on behalf of stockholders under that certain Agreement and Plan of Merger, dated as of January
16, 2024 (as it may be amended from time to time, the “Merger Agreement”), by and among the Corporation, MIWD Holding Company
LLC, a Delaware limited liability company, and RMR MergeCo, Inc., a Delaware corporation, including under Section 11.06 thereto, pursuant
to which, in the event that specific performance is not sought or granted as a remedy, the Corporation may pursue and recover damages
or other amounts set forth in Section 11.06 of the Merger Agreement, and (ii) any amounts or damages recovered by the Corporation on
behalf of the stockholders, whether through judgment, settlement or otherwise, shall, in the sole discretion of the Board of Directors
(subject to its fiduciary duties), be distributed to the stockholders by a dividend, stock repurchase or buyback or in any other manner.
Exhibit 99.1
![](https://www.sec.gov/Archives/edgar/data/1354327/000095010324000743/ex9901a.jpg)
MITER Brands to
Acquire PGT Innovations for $42.00 Per Share in Cash
Represents 60%
Premium to PGTI’s Unaffected Share Price
MITER’s
$42.00 Per Share All-Cash Proposal Declared a “Superior Proposal” by PGT Innovations’ Board
Harrisburg, Pa. and Venice, Fl. –
January 17, 2024 – MITER Brands™ (“MITER”), a nationwide manufacturer of precision-built windows and doors, and
PGT Innovations Inc. (NYSE: PGTI) (“PGTI”), a manufacturer of premium windows and doors, today announced they have entered
into a definitive merger agreement for MITER to acquire all outstanding shares of PGTI at a price of $42.00 per share in cash, or an
enterprise value of approximately $3.1 billion. The purchase price represents a premium of 60% over PGTI’s unaffected closing share
price on October 9, 2023, the last trading day prior to the public disclosure of a proposal for the acquisition of PGTI. The merger agreement
has been unanimously approved by the boards of directors of both companies. The transaction will be financed in part by an equity investment
from Koch Equity Development LLC, the principal investment and acquisition arm of Koch Industries, Inc., and a current investor in MITER.
PGTI also announced that it has terminated
its merger agreement with Masonite International Corp. (“Masonite”) dated December 17, 2023.
Executive Commentary
Matt DeSoto, President and CEO of MITER
Brands, said, “MITER and PGTI are fully aligned in providing world-class service and the finest products with a culture where people,
performance, and customer experiences come first. Our product mix and geographic presence are highly complementary, and we look forward
to delivering enhanced value to our team members, customers, suppliers and local communities. The combined company will continue its
long-held commitment to innovation, service, and high-quality window and door products as we accelerate our growth trajectory. We are
excited to welcome the PGTI team into our owner-operated business with family-first values.”
Jeffrey T. Jackson, PGTI President and
Chief Executive Officer, said, “We are thrilled to have reached an agreement with MITER that maximizes value for PGTI shareholders.
Since PGTI’s founding over 40 years ago, we have delivered profitable growth and created significant shareholder value by serving
our customers with the high-quality window and door solutions they need. In MITER, we have found a strong partner that shares our commitment
to safety, quality, and innovation. We are excited to join forces with the MITER team.”
"Koch Equity Development is excited
to support the DeSoto family along with the entire MITER Brands team in building the most valued window and door brand in America with
our third equity investment since 2019," said Richard Hunt, Managing Director at Koch Equity Development. "We are confident
that MITER’s acquisition of PGTI will result in long-term value creation for all of MITER’s stakeholders and constituencies."
Timing and Approvals
MITER and PGTI entered into their agreement
after the PGTI Board unanimously determined that MITER’s proposal constituted a “Superior Proposal” as defined in PGTI’s
merger agreement with Masonite, dated December 17, 2023. PGTI notified Masonite of its determination and Masonite waived its right to
improve the terms of its offer. In accordance with PGTI’s merger agreement with Masonite, concurrent with the signing of PGTI’s
definitive merger agreement with MITER, PGTI terminated its merger agreement with Masonite and MITER, on behalf of PGTI, paid the termination
fee of $84 million due to Masonite.
MITER’s transaction with PGTI is
expected to close by mid-year 2024, subject to PGTI shareholder approval, regulatory approval and customary closing conditions. MITER
has obtained commitment letters for the financing necessary to complete the transaction, which is not subject to a financing condition.
Upon completion of the transaction, PGTI will become a privately held subsidiary of MITER and its common stock will no longer be traded
on the NYSE.
For further information regarding the
terms and conditions contained in the definitive transaction agreement, please see PGTI’s current report on Form 8-K, which will
be filed with the U.S. Securities and Exchange Commission in connection with the transaction.
Advisors
KeyBanc Capital Markets Inc. and RBC
Capital Markets are acting as financial advisors to MITER Brands and are providing committed debt financing, and Stinson LLP is acting
as its legal counsel. Evercore is acting as exclusive financial advisor to PGTI, and Davis Polk & Wardwell LLP is acting as legal
counsel to PGTI. Rothschild & Co US Inc. is acting as financial advisor to Koch Equity Development LLC and Jones Day is acting as
its legal counsel.
About MITER Brands
Founded in 1947, MITER Brands is a residential
window and door manufacturer that produces a portfolio of window and door brands for the new construction and replacement segments with
an owner-operated, family-first approach. MITER Brands is the combination of two fast-growing regional product brands: MI Windows and
Doors and Milgard Windows and Doors, and is a nationwide supplier of precision-built and energy-efficient products with more than 10
manufacturing facilities throughout the United States. MITER Brands instills confidence and drives quality customer experiences through
optimized manufacturing, valued relationships, and dedicated team members coast to coast. For more information, visit www.miterbrands.com.
About PGT Innovations
PGT Innovations manufactures and
supplies premium windows, doors, and garage doors. Its highly engineered and technically advanced products can withstand some of the
toughest weather conditions on Earth and are revolutionizing the way people live by unifying indoor and outdoor living spaces. PGT
Innovations creates value through deep customer relationships, understanding the unstated needs of the markets it serves, and a
drive to develop category-defining products. The PGT Innovations family of brands include CGI®, PGT® Custom Windows and
Doors, WinDoor®, Western Window Systems, Anlin Windows & Doors, Eze-Breeze®, Eco Window Systems, NewSouth Window
Solutions, and Martin Door. The company’s brands, in their respective markets, are a preferred choice of architects, builders,
and homeowners throughout North America and the Caribbean. Their high-quality products are available in custom and standard sizes
with massive dimensions that allow for unlimited design possibilities in residential, multi-family, and commercial projects. For
additional information, visit http://www.pgtinnovations.com.
About Koch Equity Development LLC
Koch Equity Development (“KED”)
is the principal investment and acquisition arm of Koch Industries, Inc. (“KII”), one of the largest privately held
businesses in America. Since 2012, KED has deployed more than $35 billion in equity investments and acquisitions. With more than $125
billion of revenue, KII is a U.S.-based business with 120,000 global employees operating in more than 60 countries.
Cautionary Statement Regarding Forward-Looking
Statements
This communication
contains “forward-looking statements” within the United States Private Securities Litigation Reform Act of 1995. You can
identify these statements and other forward-looking statements in this document by words such as “may,” “will,”
“should,” “can,” “could,” “anticipate,”
“estimate,” “expect,” “predict,” “project,” “future,” “potential,”
“intend,” “plan,” “assume,” “believe,” “forecast,” “look,” “build,”
“focus,” “create,” “work,” “continue,” “target,”
“poised,” “advance,” “drive,” “aim,” “forecast,” “approach,”
“seek,” “schedule,” “position,” “pursue,” “progress,” “budget,”
“outlook,” “trend,” “guidance,” “commit,” “on track,” “objective,”
“goal,” “strategy,” “opportunity,” “ambitions,” “aspire” and similar expressions,
and variations or negative of such terms or other variations thereof. Words and terms of similar substance used in connection
with any discussion of future plans, actions, or events identify forward-looking statements.
Forward-looking
statements by their nature address matters that are, to different degrees, uncertain, such statements regarding the transactions contemplated
by the Agreement and Plan of Merger, dated as of January 16, 2024, among PGTI, MIWD Holding Company LLC and RMR MergeCo, Inc. (the “Transaction”),
including the expected time period to consummate the Transaction. All such forward-looking statements are based upon current plans, estimates,
expectations and ambitions that are subject to risks, uncertainties and assumptions, many of which are beyond the control of PGTI, that
could cause actual results to differ materially from those expressed in such forward-looking statements. Key factors that could cause
actual results to differ materially include, but are not limited to, the expected timing and likelihood of completion of the Transaction,
including the timing, receipt and terms and conditions of any required governmental and regulatory approvals of the Transaction; the
occurrence of any event, change or other circumstances that could give rise to the termination of the definitive agreement; the possibility
that PGTI’s stockholders may not approve the Transaction; the risk that the parties may not be able to satisfy the conditions to
the Transaction in a timely manner or at all; risks related to disruption of management time from ongoing business operations due to
the Transaction; the risk that any announcements relating to the Transaction could have adverse effects on the market price of PGTI’s
common stock; the risk that the Transaction and its announcement could have an adverse effect on the parties’ business relationships
and business generally, including the ability of PGTI to retain customers and retain and hire key personnel and maintain relationships
with their suppliers and customers, and on their operating results and businesses generally; the risk of unforeseen or unknown liabilities;
customer, shareholder, regulatory and other stakeholder approvals and support; the risk of potential litigation relating to the Transaction
that could be instituted against PGTI or its directors and/or officers; the risk associated with third party contracts containing material
consent, anti-assignment, transfer or other provisions that may be related to the Transaction which are not waived or otherwise satisfactorily
resolved; the risk of rating agency actions and PGTI’s ability to access short- and long-term debt markets on a timely and affordable
basis; the risk of various events that could disrupt operations, including severe weather, such as droughts, floods, avalanches and earthquakes,
cybersecurity attacks, security threats and governmental response to them, and technological changes; the risks of labor disputes, changes
in labor costs and labor difficulties; and the risks resulting from other effects of industry, market, economic, legal or legislative,
political or regulatory conditions outside of PGTI’s control. All such factors are difficult to predict and are beyond our control,
including those detailed in PGTI’s annual reports on Form 10-K, quarterly reports on Form 10-Q and Current Reports on Form 8-K
that are available on PGTI’s website at https://pgtinnovations.com and on the website of the Securities Exchange Commission
(“SEC”) at http://www.sec.gov. PGTI’s forward-looking statements are based on assumptions that PGTI’s
believes to be reasonable but that may not prove to be accurate. Other unpredictable or factors not discussed in this communication could
also have material adverse effects on forward-looking statements. PGTI does not assume an obligation to update any forward-looking statements,
except as required by applicable law. These forward-looking statements speak only as of the date hereof.
Additional
Information and Where to Find It
In
connection with the Transaction, PGTI will file with the SEC a proxy statement on Schedule 14A. The definitive proxy statement will be
sent to the stockholders of PGTI seeking their approval of the Transaction and other related matters.
INVESTORS
AND SECURITY HOLDERS ARE URGED TO READ THE PROXY STATEMENT ON SCHEDULE 14A WHEN IT BECOMES AVAILABLE, AS WELL AS ANY OTHER RELEVANT
DOCUMENTS FILED WITH THE SEC IN CONNECTION WITH THE TRANSACTION OR INCORPORATED BY REFERENCE INTO THE PROXY STATEMENT, BECAUSE THEY WILL
CONTAIN IMPORTANT INFORMATION REGARDING PGTI, THE TRANSACTION AND RELATED MATTERS.
Investors and security
holders may obtain free copies of these documents, including the proxy statement, and other documents filed with the SEC by PGTI through
the website maintained by the SEC at http://www.sec.gov. Copies of documents filed with the SEC by PGTI will be made available free of
charge by accessing PGTI’s website at https://pgtinnovations.com or by contacting PGTI by submitting a message at https://ir.pgtinnovations.com/investor-contact
or by mail at 1070 Technology Drive, North Venice, FL 34275.
Participants
in the Solicitation
PGTI, its directors,
executive officers and other persons related to PGTI may be deemed to be participants in the solicitation of proxies from PGTI’s
stockholders in connection with the Transaction. Information about the directors and executive officers of PGTI and their ownership of
PGTI common stock is also set forth in PGTI’s definitive proxy statement in connection with its 2023 Annual Meeting of Stockholders,
as filed with the SEC on April 10, 2023 (and which is available at https://www.sec.gov/Archives/edgar/data/1354327/000119312523126009/d442491ddef14a.htm),
PGTI’s Current Report on Form 8-K filed with the SEC on July 3, 2023 (and which is available at https://www.sec.gov/Archives/edgar/data/1354327/000095010323009816/dp196528_8k.htm),
PGTI’s Current Report on Form 8-K filed with the SEC on August 8, 2023 (and is available at https://www.sec.gov/Archives/edgar/data/1354327/000095010323011731/dp198129_8k.htm),
PGTI’s Current Report on Form 8-K filed with the SEC on November 6, 2023 (and is available at https://www.sec.gov/Archives/edgar/data/1354327/000095010323016034/dp202537_8k.htm),
and PGTI’s Current Report on Form 8-K filed with the SEC on January 2, 2024 (and is available at https://www.sec.gov/Archives/edgar/data/1354327/000095010324000038/dp204648_8k.htm).
Information about the directors and executive officers of PGTI, their ownership of PGTI common stock, and PGTI’s transactions with
related persons is set forth in the sections entitled “Directors, Executive Officers and Corporate Governance,” “Security
Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters,” and “Certain Relationships and Related
Transactions, and Director Independence” included in PGTI’s annual report on Form 10-K for the fiscal year ended December
31, 2022, which was filed with the SEC on February 27, 2023 (and which is available at https://www.sec.gov/Archives/edgar/data/1354327/000095017023004543/pgti-20221231.htm),
and in the sections entitled “Board Highlights” and “Security Ownership of Certain Beneficial Owners and Management”
included in PGTI’s definitive proxy statement in connection with its 2023 Annual Meeting of Stockholders, as filed with the SEC
on April 28, 2023 (and which is available at https://www.sec.gov/Archives/edgar/data/1354327/000119312523126009/d442491ddef14a.htm).
Additional information regarding the participants in the proxy solicitation and a description of their direct and indirect interests,
by security holdings or otherwise, will be included in the proxy statement and other relevant materials to be filed with the SEC in connection
with the proposed transaction when they become available. Free copies of these documents may be obtained as described in the preceding
paragraph.
No Offer or Solicitation
This communication
is not intended to and shall not constitute an offer to sell or the solicitation of an offer to sell or the solicitation of an offer
to buy any securities or the solicitation of any vote of approval, nor shall there be any sale of securities in any jurisdiction in which
such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such jurisdiction.
No offer of securities shall be made except by means of a prospectus meeting the requirements of Section 10 of the Securities Act of
1933, as amended.
Contacts
For MITER Brands:
Ira Gorsky / Patrick Ryan
miterbrands@edelmansmithfield.com
917.275.7327
For PGT Innovations:
Investors:
Craig Henderson
Chief Financial Officer
CHenderson@PGTInnovations.com
941.480.1600
Media:
Stephanie Cz
Corporate Communications and PR Manager
SCz@PGTInnovations.com
941.480.1600
FGS Global
PGTI@fgsglobal.com
212.687.8080
PGT (NYSE:PGTI)
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