Business Merger Agreement - Template, Sample Form Pro · US-law
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AGREEMENT AND PLAN OF MERGER
State of ________
RECITALS
A. This Agreement and Plan of Merger (the “Agreement”) is made and entered into as of ________ by and between the constituent entity that will be merging out of existence (the “Dissolving Entity”):
________
of
________
and the constituent entity that will survive the merger (the “Surviving Entity”):
________
of
________
The Dissolving Entity and the Surviving Entity are sometimes referred to herein individually as a “Party” and collectively as the “Parties” or the “Constituent Entities.”
B. WHEREAS, the Dissolving Entity, ________, is a ________ duly organized, validly existing, and in good standing under the laws of the State of ________, bearing entity registration/filing number ________.
C. WHEREAS, the Surviving Entity, ________, is a ________ duly organized, validly existing, and in good standing under the laws of the State of ________, bearing entity registration/filing number ________.
D. WHEREAS, upon completion of the merger contemplated herein (the “Merger”), the Dissolving Entity, ________, shall be merged with and into the Surviving Entity, and the separate existence of the Dissolving Entity shall cease, leaving the Surviving Entity, ________, as the surviving entity (the “Merged Entity”). The Merged Entity shall be a ________, duly organized, validly existing, and registered in good standing under the laws of the State of ________.
E. WHEREAS, the respective boards of directors (or governing bodies) of each Constituent Entity have determined that the Merger is advisable and in the best interests of their respective entities and equity holders, and have approved this Agreement in accordance with the applicable business entity laws of their respective states of organization.
NOW THEREFORE, in consideration of the foregoing recitals and the mutual covenants, agreements, representations, and warranties 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:
I. THE MERGER.
1. Subject to the terms and conditions of this Agreement, and in accordance with the applicable laws of the State of ________, at the Effective Time (as defined in Section 3) on the closing date of ________ (the “Closing Date”), the Dissolving Entity, ________, shall be merged with and into the Surviving Entity, ________. As a result of the Merger, the separate corporate existence of the Dissolving Entity shall cease, and the Surviving Entity shall continue as the Merged Entity and shall succeed to and assume all of the rights, properties, and obligations of the Constituent Entities by operation of law.
2. The Surviving Entity shall file articles or a certificate of merger (the “Certificate of Merger”) with the Secretary of State of the State of ________, and, where the Constituent Entities are organized under the laws of different states, with the Secretary of State of each applicable state, as required by the applicable law of each such jurisdiction. The Certificate of Merger shall be executed and acknowledged by each Constituent Entity by the number and class of authorized officers, directors, partners, or members required by applicable law. Where required, certified copies of the Certificate of Merger shall be filed in the office of the recorder in each county in which the Dissolving Entity holds real property.
3. The Merger shall become effective upon the filing of the Certificate of Merger with the Secretary of State or at such later date and time as may be specified in the Certificate of Merger as permitted by applicable law (the “Effective Time”).
5. The Merged Entity shall conduct business in the following area:
________
II. REPRESENTATIONS AND WARRANTIES OF ________.
6. This Agreement is binding upon and enforceable against ________ in accordance with its terms, except as such enforceability may be limited by any bankruptcy, insolvency, reorganization, moratorium, or other similar laws now or hereafter in effect relating to creditors’ rights generally and except as may be limited by general principles of equity (whether considered in a proceeding at law or in equity).
7. There is no litigation or other judicial or administrative proceeding pending or, to the knowledge of ________, threatened that would have a material adverse effect on the ability of this Party to consummate the transactions contemplated by this Agreement.
8. The execution, delivery, and performance of this Agreement will not violate any law, judgment, or order to which ________ is subject, or breach any agreement to which ________ is a party or by which it is bound.
9. The equity holders of ________ are acquiring the Merged Entity equity interests for their own account for investment purposes only and not with a view to distribution or resale, and acknowledge that they must bear the economic risk of such investment for an indefinite period of time because the Merged Entity equity interests have not been registered under the Securities Act of 1933, as amended, or the securities laws of the State of ________, and therefore cannot be sold unless such equity interests are subsequently registered under such Act and laws or the Merged Entity receives an opinion of counsel satisfactory to it that an exemption from such registration is available.
10. The equity interests of ________ are free and clear of any and all liens, claims, and encumbrances.
11. ________ has made available and delivered to ________ all information, statements, and records of its, including without limitation financing statements, equity holder records, and corporate or organizational documents, requested by ________, and such information, statements, and records are not misleading, were prepared in good faith, and fairly present the current operational and financial condition of the Party.
12. No representation, warranty, or statement made by ________ in this Agreement contains or will contain any untrue statement of a material fact or omits or will omit any material fact necessary to make the statements contained herein not misleading.
III. REPRESENTATIONS AND WARRANTIES OF ________.
13. This Agreement is binding upon and enforceable against ________ in accordance with its terms, except as such enforceability may be limited by any bankruptcy, insolvency, reorganization, moratorium, or other similar laws now or hereafter in effect relating to creditors’ rights generally and except as may be limited by general principles of equity.
14. There is no litigation or other judicial or administrative proceeding pending or, to the knowledge of ________, threatened that would have a material adverse effect on the ability of this Party to consummate the transactions contemplated by this Agreement.
15. The execution, delivery, and performance of this Agreement will not violate any law, judgment, or order to which ________ is subject, or breach any agreement to which ________ is a party or by which it is bound.
16. ________ has made available and delivered to ________ all information, statements, and records of its, including without limitation financing statements, equity holder records, and corporate or organizational documents, requested by ________, and such information, statements, and records are not misleading, were prepared in good faith, and fairly present the current operational and financial condition of the Party.
17. No representation, warranty, or statement made by ________ in this Agreement contains or will contain any untrue statement of a material fact or omits or will omit any material fact necessary to make the statements contained herein not misleading.
IV. COVENANTS AND CONDITIONS.
18. Between the date of this Agreement and the Effective Time, each Constituent Entity shall not, except as otherwise consented to in writing by the other Party:
a. Except in the ordinary course of business and for adequate value, dispose of any of its assets;
b. Enter into any contract or agreement obligating it for a period in excess of thirty (30) days, except in the ordinary course of business;
c. Make any distributions to its equity holders; or
d. Engage in any of the following activities:
________
19. The obligation of each Party to effect the Merger is subject to the satisfaction or written waiver of each of the following conditions on or before the Closing Date:
a. The representations, warranties, and covenants made by each Party are true and correct as of the Closing Date;
b. There has been no material adverse change in the business or financial condition of either Party from the date of this Agreement through the Closing Date;
c. This Agreement is approved by the Board of Directors and the equity holders of ________ entitled to vote on the matter in accordance with the laws of the State of ________ and their governing documents; and
d. This Agreement is approved by the Board of Directors and the equity holders of ________ entitled to vote on the matter in accordance with the laws of the State of ________ and their governing documents.
V. VALUATION OF ASSETS.
21. The directors, officers, partners, or managers of ________ hereby attest to the following regarding the valuation of their assets:
a. The present value of its tangible and intangible assets, including goodwill, is $________;
b. The fair market value of its unrealized receivables is $________;
c. The fair market value of its inventory is $________; and
d. The estimated amount of its liabilities is $________.
22. The directors, officers, partners, or managers of ________ hereby attest to the following regarding the valuation of their assets:
a. The present value of its tangible and intangible assets, including goodwill, is $________;
b. The fair market value of its unrealized receivables is $________;
c. The fair market value of its inventory is $________; and
d. The estimated amount of its liabilities is $________.
VI. CONVERSION OF EQUITY INTERESTS.
23. At the Effective Time, by virtue of the Merger and without any action on the part of the holders thereof, each issued and outstanding equity interest in ________ shall be converted into ________ equity interest(s) of the Merged Entity, ________.
24. No fractional equity interests of the Merged Entity shall be issued to the holders of equity interests of ________. Holders who would otherwise be entitled to receive a fraction of an equity interest shall instead receive a cash payment equal to the value of that fraction, based on the fair market value of an equity interest of ________ as of the Effective Time.
25. At the Effective Time, each issued and outstanding equity interest of ________ shall be converted into ________ equity interest(s) of the Merged Entity.
26. No fractional equity interests of the Merged Entity shall be issued to the holders of equity interests of ________. Holders who would otherwise be entitled to receive a fraction of an equity interest shall instead receive a cash payment equal to the value of that fraction, based on the fair market value of an equity interest of ________ as of the Effective Time.
27. If any equity interest of ________ being exchanged in connection with the Merger is evidenced by a certificate, each holder of such interest must surrender the certificate or certificates, properly endorsed, to the Merged Entity or its transfer agent, and shall receive in exchange a certificate or certificates representing the number of equity interests of the Merged Entity into which the equity interests of ________ have been converted.
VII. APPRAISAL AND DISSENTERS’ RIGHTS.
28. Each equity holder of a Constituent Entity who is entitled to appraisal, dissenters’, or similar rights under the applicable business entity laws of its state of organization, and who properly exercises and perfects such rights in accordance with the requirements of such laws, shall be entitled to receive payment of the fair value of such holder’s equity interests as determined in accordance with the applicable statutory procedures. Each Party shall give all required notices to its equity holders concerning such rights within the time and in the manner prescribed by applicable law.
VIII. MANAGEMENT OF MERGED ENTITY.
29. The directors, officers, partners, or managers of the Merged Entity shall have control of the business, subject to any limitations in the articles, by-laws, or operating agreement of the Merged Entity and applicable law.
30. The initial Board of Directors of the Merged Entity shall consist of ________ directors. The Dissolving Entity shall be entitled to nominate ________ members of the Board of Directors of the Merged Entity.
IX. LIABILITIES AND OBLIGATIONS.
31. As of the Effective Time, the Merged Entity shall assume and be responsible for all of the debts, liabilities, and obligations of each of the Constituent Entities. All rights of creditors and all liens upon the property of each Constituent Entity shall be preserved unimpaired, and all debts, liabilities, and duties of the respective Constituent Entities shall thenceforth attach to the Merged Entity and may be enforced against it to the same extent as if such debts, liabilities, and duties had been incurred or contracted by it.
32. Any action or proceeding, whether civil or criminal, pending by or against either Constituent Entity may be prosecuted to judgment as if the Merger had not taken place, or the Merged Entity may be substituted in place of such Constituent Entity.
X. EXPENSES.
33. Each Party shall bear its own costs and expenses, including legal, accounting, and other professional fees, incurred in connection with the negotiation, preparation, and execution of this Agreement and the consummation of the Merger contemplated herein, whether or not the Merger is completed.
XI. TERMINATION.
34. This Agreement will automatically terminate in the event that it is brought to a subsequent vote and not adopted by either the Board of Directors or the equity holders of ________ entitled to vote on the matter, or by either the Board of Directors or the equity holders of ________ entitled to vote on the matter.
35. This Agreement may be terminated and the Merger abandoned at any time before the Effective Time by mutual written agreement of the Parties, by either Party if any condition provided in this Agreement has not been satisfied or waived on or before the Closing Date, or by either Party if there has been a material breach of this Agreement by the other Party.
36. Upon termination, this Agreement will become wholly void and of no effect, without liability or obligation on the part of either Party, except that termination shall not relieve any Party of liability for any willful breach of this Agreement occurring prior to such termination.
XII. NOTICES.
37. Any notice, request, demand, or other communication required or permitted under this Agreement shall be in writing and may be delivered in person, by nationally recognized overnight courier, by certified mail return receipt requested, or by electronic mail with confirmation of receipt. Notices shall be sent to the address of the respective Party as first set forth above or as may thereafter be updated in writing by either Party, and shall be deemed given upon receipt.
XIII. ENTIRE AGREEMENT.
38. This Agreement contains the entire agreement of the Parties, and there are no other promises or conditions in any other agreement, whether oral or written, concerning the subject matter of this Agreement.
39. This Agreement supersedes any prior written or oral agreements between the Parties concerning the subject matter hereof.
XIV. SEVERABILITY.
40. If any provision of this Agreement is held to be invalid or unenforceable for any reason, the remaining provisions shall continue to be valid and enforceable.
41. If a court finds that any provision of this Agreement is invalid or unenforceable, but that by limiting such provision it would become valid and enforceable, then such provision shall be deemed to be written, construed, and enforced as so limited.
XV. AMENDMENT.
42. This Agreement may be modified or amended only by a writing signed by the Party against whom enforcement of the amendment is sought, and, to the extent required by applicable law, subject to the approval of the respective boards of directors and equity holders of the Constituent Entities.
XVI. GOVERNING LAW AND VENUE.
43. This Agreement shall be governed by and construed in accordance with the laws of the State of ________, without regard to its conflict of laws principles. The Parties consent to the exclusive jurisdiction and venue of the state and federal courts located in ________ County, State of ________, for the resolution of any dispute arising out of or relating to this Agreement.
XVII. WAIVER OF CONTRACTUAL RIGHTS.
44. The failure of either Party to enforce any provision of this Agreement shall not be construed as a waiver or limitation of that Party’s right to subsequently enforce and compel strict compliance with every provision of this Agreement.
XVIII. COUNTERPARTS.
45. This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall constitute one and the same instrument. Signatures delivered by electronic means shall be deemed to be original signatures for all purposes.
IN WITNESS WHEREOF, the Parties hereto have caused this Agreement to be duly executed by their respective authorized representatives, to be effective as of the day and year first written above.
EXECUTION:
_________________________________
________, Title: ________, Authorized Representative of ________, Dissolving Entity
_________________
Date: ________
_________________________________
________, Title: ________, Authorized Representative of ________, Surviving Entity
_________________
Date: ________
ACKNOWLEDGMENT
State of ________
County of ________
On this ________, before me, the undersigned notary public, personally appeared ________, proved to me through satisfactory evidence of identification to be the person(s) whose name(s) is/are signed on the foregoing instrument, and acknowledged that they executed the same voluntarily for its stated purpose in their stated capacities.
_________________________________
Notary Public
My commission expires: ________
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