<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
SCHEDULE 14D-1
TENDER OFFER STATEMENT
PURSUANT TO SECTION 14(d)(1) OF THE SECURITIES EXCHANGE ACT OF 1934
AND
AMENDMENT NO. 2 TO
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
STERIGENICS INTERNATIONAL, INC.
(Name of Subject Company)
ION BEAM APPLICATIONS S.A.
IBA ACQUISITION CORP.
(Bidders)
COMMON STOCK, PAR VALUE $0.001 PER SHARE
(Title of Class of Securities)
85915R105
(CUSIP Number of Class of Securities)
------------------------
MR. PIERRE MOTTET
ION BEAM APPLICATIONS S.A.
CHEMIN DU CYCLOTRON, 3
B-1348 LOUVAIN-LA-NEUVE
BELGIUM
(011-32-10-47-5855)
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidders)
COPIES TO:
RAMON P. MARKS, ESQ.
KEVIN T. COLLINS, ESQ.
DORSEY & WHITNEY LLP
250 PARK AVENUE
NEW YORK, NEW YORK 10177
(212) 415-9200
CALCULATION OF FILING FEE
<TABLE>
<CAPTION>
TRANSACTION VALUATION AMOUNT OF FILING FEE
<S> <C>
$248,076,324* $49,800**
</TABLE>
* For purposes of fee calculation only. The total transaction value is based
on 8,005,802 shares of common stock, par value $0.001 per share together
with the associated preferred share purchase rights (the "Shares")
outstanding as of May 31, 1999 plus 1,182,210 shares issuable upon the
exercise of options that were outstanding on that date, multiplied by the
offer price of $27.00 per share.
** The amount of the filing fee calculated in accordance with Regulation
240.0-11 of the Securities Exchange Act of 1934 equals 1/50th of 1% of the
aggregate value of the cash offered by IBA Acquisition Corp. for such number
of shares.
/ / CHECK BOX IF ANY PART OF THE FEE IS OFFSET AS PROVIDED BY RULE 0-11(A)(2)
AND IDENTIFY THE FILING WITH WHICH THE OFFSETTING FEE WAS PREVIOUSLY PAID.
IDENTIFY THE PREVIOUS FILING BY REGISTRATION STATEMENT NUMBER, OR THE FORM OR
SCHEDULE AND THE DATE OF IT FILING.
<TABLE>
<S> <C> <C> <C>
Amount previously paid: None Filing party: Not Applicable
Form or registration no.: Not Applicable Date filed: Not Applicable
</TABLE>
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<PAGE>
14D-1 AND 13D
CUSIP NO. 85915R 10 5 Page 2 of 9 Pages
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1. NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Ion Beam Applications s.a.
- --------------------------------------------------------------------------------
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) / /
(b) / /
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
WC; BK
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5. CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM 2(e)
OR 2(f)
/ /
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
Belgium
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7. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
3,245,612* Shares
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8. CHECK IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN SHARES
/ /
- --------------------------------------------------------------------------------
9. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
40.54%
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10. TYPE OF REPORTING PERSON
CO
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- ------------------------
* On June 10, 1999, Ion Beam Applications s.a. ("Parent"), Ion Beam
Applications G.P. ("IBA GP") and IBA Acquisition Corp. ("Purchaser") entered
into a Stockholders' Agreement (the "Stockholders' Agreement") with seven
stockholders of the Company (the "Selling Stockholders") with respect to
2,494,312 shares of the common stock, par value $0.001 per share (the
"Common Stock"), together with the associated rights to purchase shares of
Series A Junior Participating Preferred Stock, par value $0.001 per share
(the "Rights," and together with the Common Stock, the "Shares"). Pursuant
to the Stockholders' Agreement, upon the terms and subject to the conditions
therein, the Selling Stockholders have agreed to validly tender and not
withdraw Shares owned by such stockholder pursuant to the Offer (as defined
herein) and have granted to Parent: (i) an irrevocable proxy to vote for
approval of the transactions contemplated by the Merger Agreement, dated
June 10, 1999, between Parent, IBA GP, Purchaser and the Company and to vote
against any action or agreement intended or expected to interfere with such
transactions and certain extraordinary corporate actions of the Company; and
(ii) an option, exercisable in limited circumstances, to purchase all of
their Shares. The Shares that are subject to the Stockholders' Agreement are
included in Rows 7 and 9 above. In addition, Parent directly owns 751,300
shares of Common Stock.
<PAGE>
14D-1 AND 13D
CUSIP NO. 85915R 10 5 Page 3 of 9 Pages
- --------------------------------------------------------------------------------
1. NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
IBA Acquisition Corp.
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP**
(a) / /
(b) / /
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
AF
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM
2(e) OR 2(f)
/ /
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
0 Shares
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8. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN SHARES
/ /
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9. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
0%
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10. TYPE OF REPORTING PERSON
CO
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<PAGE>
14D-1 AND 13D
CUSIP NO. 85915R 10 5 Page 4 of 9 Pages
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1. NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Belgabeam SCRL*
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP**
(a) / /
(b) / /
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
Not Applicable
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5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM
2(e) OR 2(f)
/ /
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
Belgium
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7. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
0 Shares
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8. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN SHARES
/ /
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9. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
0%
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10. TYPE OF REPORTING PERSON
CO
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- ------------------------
* Belgabeam SCRL was incorrectly indentified as "Belgabeam S.A." in the
Schedule 13D filed on March 11, 1999 and the Amendment No. 1 to the Schedule
13D filed on June 11, 1999.
<PAGE>
INTRODUCTION
This Tender Offer Statement on Schedule 14D-1 (this "Statement") relates to
the offer by IBA Acquisition Corp., a Delaware corporation ("Purchaser"), and a
wholly owned, indirect subsidiary of Ion Beam Applications s.a., a Belgian
corporation ("IBA" or "Parent"), to purchase all of the outstanding shares of
common stock, par value $0.001 per share (the "Common Stock") together with the
associated rights to purchase shares of Series A Junior Participating Preferred
Stock, par value $0.001 per share (the "Rights" and together with the Common
Stock (the "Shares") of the SteriGenics International, Inc., a Delaware
corporation (the "Company") not owned by Parent, Purchaser, or any of their
affiliates, at a price of $27.00 per Share, net to the tendering stockholder in
cash, upon terms and subject to the conditions set forth in the Offer to
Purchase, dated as of June 17, 1999 (the "Offer to Purchase"), and the related
Letter of Transmittal (which together constitute the "Offer"), copies of which
are attached hereto as Exhibits (a)(1) and (a)(2), respectively. The Offer is
being made pursuant to a Merger Agreement, dated June 10, 1999, by and among
Parent, Ion Beam Applications G.P., a Delaware general partnership which owns
all of the outstanding capital stock of Purchaser and of which the Parent is the
controlling general partner ("IBA GP"), Purchaser and the Company, which
provides, among other things, that as promptly as practicable after the
satisfaction or, if permissible, waiver of the conditions set forth therein
(including without limitation, the purchase of Shares pursuant to the Offer),
the Purchaser will be merged with and into the Company (the "Merger"), with the
Company continuing as the surviving corporation, and each issued and outstanding
Share (other than any Shares held by any of the Company's subsidiaries or any
Shares held by IBA, Purchaser or any other subsidiary of IBA, and, in the event
that dissenters' rights are available following the Merger, other than Shares
held by stockholders who shall not have voted in favor of the Merger and who
shall have complied with all of the relevant provisions of Section 262 of the
Delaware General Corporation Law), will be converted automatically into the
right to receive $27.00 per Share, in cash, without interest, upon surrender of
the certificate representing the Share.
The information contained in this Statement concerning the Company,
including, without limitation, information concerning the approvals and
recommendations of the Board of Directors of the Company in connection with the
transaction, the opinions of the financial advisors to such Board of Directors,
and the Company's capital structure and financial information, was supplied by
the Company. Purchaser takes no responsibility for the accuracy of such
information.
ITEM 1. ISSUER AND CLASS OF SECURITY SUBJECT TO THE TRANSACTION
(a) The name of the subject company is SteriGenics International, Inc., a
Delaware corporation, which has its principal executive offices at 4020 Clipper
Court, Fremont, California 94538-6540. Information set forth in the Offer to
Purchase under the caption "THE TENDER OFFER--7. Certain Information Concerning
The Company" is incorporated herein by reference.
(b) The class of equity securities being sought is the Company's Common
Stock together with the associated Rights. Information set forth in the Offer to
Purchase under the caption "INTRODUCTION" is incorporated herein by reference.
(c) The information concerning the principal market in which the Shares are
traded and certain high and low sales prices for the Shares in such principal
market set forth in the Offer to Purchase under the caption "THE TENDER
OFFER--6. Price Range Of The Shares" is incorporated herein by reference.
ITEM 2. IDENTITY AND BACKGROUND
(a)-(d), (g) This Statement is filed by Purchaser and IBA. The information
concerning the name, state or other place of organization, principal business
and address of the principal office of Purchaser, IBA, IBA GP and Belgabeam
SCRL, a Belgian corporation and the largest shareholder of IBA, and the name,
business address, present principal occupation or employment (including the
name, principal business and address of any corporation or other organization in
which such employment or occupation is
5
<PAGE>
conducted), material occupations, positions, offices or employment during the
last five years and citizenship of each of the executive officers and directors
of Purchaser, IBA and Belgabeam SCRL and the executive officers and directors of
the partners of IBA GP set forth in the Offer to Purchase under the captions
"INTRODUCTION" and "THE TENDER OFFER--8. Certain Information Concerning
Purchaser And Parent," and in Schedule I to the Offer to Purchase, are
incorporated herein by reference.
(e) and (f) During the last five years, neither Purchaser nor IBA, nor, to
the knowledge of Purchaser and IBA, none of IBA GP, Belgabeam SCRL or any person
listed in Schedule I to the Offer to Purchase has been (i) convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors) or
(ii) a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
activities subject to, federal or state securities laws or finding any
violations of such laws.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS
(a) The information set forth in the Offer to Purchase under the captions
"INTRODUCTION," "THE TENDER OFFER--8. Certain Information Concerning Purchaser
And Parent," and "THE TENDER OFFER--10. Certain Transactions Between IBA And The
Company" is incorporated herein by reference.
(b) The information set forth in the Offer to Purchase under the captions
"INTRODUCTION," "THE TENDER OFFER--8. Certain Information Concerning Purchaser
And Parent," "THE TENDER OFFER--10. Certain Transactions between IBA And The
Company," and "THE TENDER OFFER--11. Contacts With The Company; Background Of
The Offer And The Merger" is incorporated herein by reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATIONS
(a) and (b) The information set forth in the Offer to Purchase under the
caption "THE TENDER OFFER--9. Source And Amount Of Funds" is incorporated herein
by reference.
(c) Not applicable.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSAL OF THE BIDDER
(a)-(e) The information set forth in the Offer to Purchase under the
captions "INTRODUCTION" and "THE TENDER OFFER--12. Purpose Of The Offer; The
Merger Agreement; The Stockholders' Agreement" is incorporated herein by
reference.
(f) and (g) The information set forth in the Offer to Purchase under the
caption "THE TENDER OFFER--14. Effects Of The Offer On The Market For Shares;
Nasdaq National Market And Exchange Act Registration" is incorporated herein by
reference.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY
(a) and (b) The information set forth in the Offer to Purchase under the
captions "THE TENDER OFFER--8. Certain Information Concerning Purchaser And
Parent" and "THE TENDER OFFER--12. Purpose Of The Offer; The Merger Agreement;
The Stockholders' Agreement" is incorporated herein by reference.
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
THE SUBJECT COMPANY'S SECURITIES
The information set forth in the Offer to Purchase under the captions "THE
TENDER OFFER--8. Certain Information Concerning Purchaser And Parent " and "THE
TENDER OFFER--12. Purpose of the Offer; The Merger Agreement; The Stockholders'
Agreement" is incorporated herein by reference.
6
<PAGE>
ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED
The information set forth in the Offer to Purchase under the caption
"INTRODUCTION" and "THE TENDER OFFER--17. Fees And Expenses" is incorporated
herein by reference.
ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS
The Purchaser and Parent do not believe that any of the financial statements
of either of them or any affiliates are material to stockholders of the Company
when deciding whether to sell, tender or hold Shares.
ITEM 10. ADDITIONAL INFORMATION
(a) The information set forth in the Offer to Purchase under the caption
"THE TENDER OFFER-- 12. Purpose Of The Offer; The Merger Agreement; The
Stockholders' Agreement" is incorporated herein by reference.
(b) and (c) The information set forth in the Offer to Purchase under the
caption "THE TENDER OFFER--16. Certain Legal Matters; Regulatory Approvals" is
incorporated herein by reference.
(d) The information set forth in the Offer to Purchase under the caption
"THE TENDER OFFER-- 14. Effects Of The Offer On The Market For Shares; Nasdaq
National Market And Exchange Act Registration" and "THE TENDER OFFER--16.
Certain Legal Matters; Regulatory Approvals" is incorporated herein by
reference.
(e) Not Applicable.
(f) The information set forth in the Offer to Purchase and the Letter of
Transmittal, to the extent not otherwise incorporated by reference, is
incorporated herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS
(a)(1) Offer to Purchase dated June 17, 1999
(a)(2) Letter of Transmittal
(a)(3) Notice of Guaranteed Delivery
(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and
Other Nominees
(a)(5) Letter to Clients for use by Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees
(a)(6) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9
(a)(7) Form of Summary Advertisement dated June 17, 1999
(a)(8) Press Release dated June 11, 1999 issued by Parent
(b) Commitment Letter from Bank Brussels Lambert S.A., dated June 10,
1999
(c)(1) Merger Agreement dated as of June 10, 1999, among the Company,
Purchaser, IBA GP and IBA
(c)(2) Stockholders' Agreement dated June 10, 1999, among Purchaser, IBA,
IBA GP and certain stockholders of the Company
(c)(3) Non-Disclosure Agreement, dated May 17, 1999 between IBA and the
Company
(d) None
(e) Not Applicable
(f) None
7
<PAGE>
SIGNATURE
After due inquiry and to the best of his knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
Dated: June 17, 1999 IBA ACQUISITION CORP.
By /s/ PIERRE MOTTET
--------------------------------------
Name: Pierre Mottet
Title: Chief Executive Officer
SIGNATURE
After due inquiry and to the best of his knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
Dated: June 17, 1999 ION BEAM APPLICATIONS S.A.
By /s/ PIERRE MOTTET
--------------------------------------
Name: Pierre Mottet
Title: Chief Executive Officer
SIGNATURE
After due inquiry and to the best of his knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
Dated: June 17, 1999 BELGABEAM SCRL
By /s/ ERIC DE LAMOTTE
--------------------------------------
Name: Eric de Lamotte
Title: Director
8
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER EXHIBIT PAGE
- --------- ------------------------------------------------------------------------------------------- -----------
<S> <C> <C>
(a)(1) Offer to Purchase dated June 17, 1999
(a)(2) Letter of Transmittal
(a)(3) Notice of Guaranteed Delivery
(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees
(a)(5) Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other
Nominees
(a)(6) Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9
(a)(7) Form of Summary Advertisement dated June 17, 1999
(a)(8) Press Release dated June 11, 1999 issued by IBA
(b) Commitment Letter from Bank Brussels Lambert S.A., dated June 10, 1999
(c)(1) Merger Agreement dated as of June 10, 1999, among the Company, Purchaser, IBA GP and IBA
(c)(2) Stockholders' Agreement dated June 10, 1999, among Purchaser, IBA, IBA GP and certain
stockholders of the Company
(c)(3) Non-Disclosure Agreement, dated May 17, 1999 Agreement between IBA and the Company.
(d) None
(e) Not Applicable
(f) None
</TABLE>
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
INCLUDING THE ASSOCIATED RIGHTS
TO
PURCHASE SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
OF
STERIGENICS INTERNATIONAL, INC.
AT
$27.00 NET PER SHARE
BY
IBA ACQUISITION CORP.,
AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF
ION BEAM APPLICATIONS S.A.
- -------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT MIDNIGHT, NEW YORK CITY TIME,
ON THURSDAY, JULY 15, 1999 (THE "EXPIRATION DATE"), UNLESS THE OFFER IS
EXTENDED.
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THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION DATE THAT NUMBER OF SHARES OF
COMMON STOCK, TOGETHER WITH THE ASSOCIATED RIGHTS TO PURCHASE SHARES OF SERIES A
JUNIOR PARTICIPATING PREFERRED STOCK, WHICH, WHEN COMBINED WITH THE SHARES
ALREADY OWNED BY PARENT, PURCHASER AND THEIR AFFILIATES, CONSTITUTES A MAJORITY
OF THE TOTAL NUMBER OF SHARES OF STERIGENICS INTERNATIONAL, INC., (THE
"COMPANY") OUTSTANDING ON A DILUTED BASIS (INCLUDING FOR PURPOSES OF SUCH
CALCULATION ALL SHARES ISSUABLE UPON EXERCISE OF ALL VESTED AND UNVESTED STOCK
OPTIONS, AND CONVERSION OF CONVERTIBLE SECURITIES OR OTHER RIGHTS TO PURCHASE OR
ACQUIRE SHARES) AND (2) THE SATISFACTION OR WAIVER OF CERTAIN CONDITIONS TO THE
OBLIGATIONS OF PURCHASER AND THE COMPANY TO CONSUMMATE THE TRANSACTIONS
CONTEMPLATED BY THE MERGER AGREEMENT, INCLUDING RECEIPT BY PURCHASER AND THE
COMPANY OF CERTAIN GOVERNMENTAL AND REGULATORY APPROVALS.
THE BOARD OF DIRECTORS OF THE COMPANY HAS DETERMINED THAT THE MERGER
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE OFFER AND THE
MERGER, ARE FAIR TO AND IN THE BEST INTERESTS OF THE STOCKHOLDERS OF THE
COMPANY, HAS APPROVED THE MERGER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED
THEREBY, INCLUDING THE OFFER AND THE MERGER, AND RECOMMENDS THAT THE
STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR SHARES PURSUANT TO THE OFFER.
--------------------------
IMPORTANT
Any stockholder desiring to tender Shares (as defined herein) should either
(1) complete and sign the Letter of Transmittal, or a facsimile copy thereof, in
accordance with the instructions in the Letter of Transmittal, mail or deliver
it and any other required documents to the Depositary and either deliver the
certificates for such Shares to the Depositary along with the Letter of
Transmittal or tender such Shares pursuant to the procedure for book-entry
transfer set forth in this Offer to Purchase under the caption "THE TENDER
OFFER--2. Procedure For Accepting The Offer And Tendering Shares" or (2) request
such stockholder's broker, dealer, commercial bank, trust company or other
nominee to effect the transaction for the stockholder. Stockholders having
Shares registered in the name of a broker, dealer, commercial bank, trust
company or other nominee must contact such broker, dealer, commercial bank,
trust company or other nominee if they desire to tender such Shares.
A stockholder who desires to tender Shares and whose certificates for Shares
are not immediately available, or who cannot comply on a timely basis with the
procedures for book-entry transfer described in this Offer to Purchase, may
tender such Shares by following the procedure for guaranteed delivery set forth
in this Offer to Purchase under the caption "THE TENDER OFFER--2. Procedure For
Accepting The Offer And Tendering Shares."
Questions and requests for assistance, or for additional copies of this
Offer to Purchase, the Letter of Transmittal, the Notice of Guaranteed Delivery
or other tender offer materials, may be directed to the Information Agent or the
Dealer Manager at their respective addresses and telephone numbers set forth on
the back cover of this Offer to Purchase. Holders of Shares may also contact
brokers, dealers, commercial banks or trust companies for assistance concerning
the Offer.
--------------------------
THIS TRANSACTION HAS NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION NOR HAS THE SECURITIES AND EXCHANGE COMMISSION PASSED UPON
THE FAIRNESS OR MERITS OF THIS TRANSACTION OR UPON THE ACCURACY OR ADEQUACY OF
THE INFORMATION CONTAINED IN THIS DOCUMENT. ANY REPRESENTATION TO THE CONTRARY
IS UNLAWFUL.
--------------------------
THE DEALER MANAGER FOR THE OFFER IS:
BEAR, STEARNS & CO. INC.
245 Park Avenue
New York, NY 10167
Call toll free (888) 293-1889
The date of this Offer to Purchase is June 17, 1999.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
-----
<S> <C>
INTRODUCTION............................................................................................... 1
THE TENDER OFFER...........................................................................................
1. TERMS OF THE OFFER; EXPIRATION DATE..................................................................
2. PROCEDURE FOR ACCEPTING THE OFFER AND TENDERING SHARES...............................................
3. WITHDRAWAL RIGHTS....................................................................................
4. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES........................................................
5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES..............................................................
6. PRICE RANGE OF THE SHARES............................................................................
7. CERTAIN INFORMATION CONCERNING THE COMPANY...........................................................
8. CERTAIN INFORMATION CONCERNING PURCHASER AND PARENT..................................................
9. SOURCE AND AMOUNT OF FUNDS...........................................................................
10. CERTAIN TRANSACTIONS BETWEEN IBA AND THE COMPANY.....................................................
11.CONTACTS WITH THE COMPANY; BACKGROUND OF THE OFFER AND THE MERGER.....................................
12.PURPOSE OF THE OFFER; THE MERGER AGREEMENT; THE STOCKHOLDERS' AGREEMENT...............................
13. DIVIDENDS AND DISTRIBUTIONS..........................................................................
14.EFFECTS OF THE OFFER ON THE MARKET FOR SHARES; NASDAQ NATIONAL MARKET AND EXCHANGE ACT REGISTRATION...
15.CERTAIN CONDITIONS OF THE OFFER.......................................................................
16. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS..........................................................
17. FEES AND EXPENSES....................................................................................
18. MISCELLANEOUS........................................................................................
SCHEDULE I................................................................................................. 14
ANNEX A.................................................................................................... 14
</TABLE>
i
<PAGE>
To the Holders of Common Stock of SteriGenics International, Inc.:
INTRODUCTION
IBA Acquisition Corp., a Delaware corporation ("Purchaser"), which is a
wholly-owned, indirect subsidiary of Ion Beam Applications s.a., a Belgian
corporation ("IBA" or "Parent"), hereby offers to purchase all outstanding
shares of common stock, par value $0.001 per share (the "Common Stock"),
together with the associated rights to purchase shares of Series A Junior
Participating Preferred Stock, par value $0.001 per share (the "Rights" and,
together with the Common Stock, the "Shares"), of SteriGenics International,
Inc., a Delaware corporation (the "Company"), upon the terms and subject to the
conditions set forth in this Offer to Purchase and in the related Letter of
Transmittal (which together constitute the "Offer"), at the purchase price of
$27.00 per Share (the "Offer Price"), net to the tendering stockholder in cash.
The Offer is being made pursuant to a Merger Agreement dated as of June 10,
1999 (the "Merger Agreement"), by and among the Company, Parent, Ion Beam
Applications G.P., a Delaware general partnership which owns all of the
outstanding capital stock of Purchaser and of which IBA is the controlling
general partner ("IBA GP") and Purchaser. The Merger Agreement provides, among
other things, that as promptly as practicable following the completion of the
Offer and the satisfaction or waiver of certain conditions, including the
purchase of Shares pursuant to the Offer (the "Consummation" of the Offer) and
the approval and adoption of the Merger Agreement by the stockholders of the
Company, if required by applicable law, Purchaser will be merged with and into
the Company (the "Merger"), with the Company as the surviving corporation (the
"Surviving Corporation"). In the Merger, each issued and outstanding Share
(other than Dissenting Shares (as hereinafter defined)) not owned by Parent,
Purchaser, or any of the subsidiaries of Parent (collectively, "Parent
Companies") or shares held by any subsidiaries of the Company will be converted
into and represent the right to receive $27.00 in cash without interest (the
"Offer Price"). See "THE TENDER OFFER--11. Contacts With The Company; Background
Of The Offer And The Merger."
Concurrently with the execution of the Merger Agreement, seven stockholders
(the "Selling Stockholders") entered into a Stockholders' Agreement, dated as of
June 10, 1999, with Parent, IBA GP and Purchaser (the "Stockholders'
Agreement"). The Selling Stockholders beneficially own 2,494,312 shares of
Common Stock representing 31.16% of the total outstanding Shares (excluding
options) or 27.15% of the total outstanding Shares calculated on a diluted
basis. Pursuant to the Stockholders' Agreement, the Selling Stockholders have
agreed, among other things, to validly tender pursuant to the Offer and not
withdraw unless and until the Merger Agreement is terminated in accordance with
its terms without the Shares being purchased in the Offer all Shares that are
owned of record or beneficially by such Selling Stockholders and vote such
Shares in favor of the Merger, in each case upon the terms and subject to
conditions and limitations set forth in the Stockholders' Agreement. The
Stockholders' Agreement is more fully described below. See "THE TENDER
OFFER--12. Purpose Of The Offering; The Merger Agreement; The Stockholders'
Agreement."
THE BOARD OF DIRECTORS OF THE COMPANY HAS DETERMINED THAT THE MERGER
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE OFFER AND THE
MERGER, ARE FAIR TO AND IN THE BEST INTERESTS OF THE STOCKHOLDERS OF THE
COMPANY, HAS APPROVED THE MERGER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED
THEREBY, INCLUDING THE OFFER AND THE MERGER, AND RECOMMENDS THAT THE
STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR SHARES PURSUANT TO THE OFFER.
ACCORDINGLY, SECTION 203 OF THE DELAWARE GENERAL CORPORATION LAW ("DGCL") (WHICH
RESTRICTS THE ABILITY OF AN "INTERESTED STOCKHOLDER" FROM ENGAGING IN A
"BUSINESS COMBINATION" WITH A DELAWARE CORPORATION FOR A PERIOD OF THREE YEARS
FOLLOWING THE DATE ON WHICH SUCH STOCKHOLDER BECAME AN "INTERESTED STOCKHOLDER")
IS
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INAPPLICABLE TO THE OFFER, THE MERGER AGREEMENT AND THE STOCKHOLDERS' AGREEMENT.
SEE "THE TENDER OFFER--16. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS."
PAINEWEBBER INCORPORATED AND TM CAPITAL CORP., FINANCIAL ADVISORS TO THE
COMPANY, HAVE DELIVERED WRITTEN OPINIONS TO THE COMPANY'S BOARD OF DIRECTORS
DATED JUNE 10, 1999 (THE "OPINIONS"), TO THE EFFECT THAT, AS OF THAT DATE, THE
CONSIDERATION TO BE RECEIVED IN THE OFFER AND THE MERGER BY THE STOCKHOLDERS OF
THE COMPANY IS FAIR FROM A FINANCIAL POINT OF VIEW TO SUCH STOCKHOLDERS. THE
FULL TEXT OF THE OPINIONS WILL BE ATTACHED TO THE COMPANY'S
SOLICITATION/RECOMMENDATION STATEMENT ON SCHEDULE 14D-9, WHICH IS REQUIRED TO BE
MAILED TO STOCKHOLDERS OF THE COMPANY ON OR BEFORE JUNE 30, 1999. STOCKHOLDERS
ARE URGED TO READ SUCH OPINIONS CAREFULLY AND IN THEIR ENTIRETY FOR ASSUMPTIONS
MADE, MATTERS CONSIDERED AND LIMITS OF THE REVIEW OF PAINEWEBBER INCORPORATED
AND TM CAPITAL CORP.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THE SATISFACTION OR
WAIVER OF CERTAIN CONDITIONS TO THE OBLIGATIONS OF PURCHASER, IBA AND THE
COMPANY TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED BY THE MERGER AGREEMENT,
INCLUDING (I) THERE BEING VALIDLY TENDERED AND NOT WITHDRAWN PRIOR TO THE
EXPIRATION DATE, THAT NUMBER OF SHARES WHICH, WHEN COMBINED WITH THE SHARES HELD
BY PARENT, PURCHASER AND ALL OF THEIR AFFILIATES, REPRESENTS AT LEAST A MAJORITY
OF THE THEN OUTSTANDING SHARES ON A DILUTED BASIS (INCLUDING FOR PURPOSES OF
SUCH CALCULATION ALL SHARES ISSUABLE UPON EXERCISE OF ALL VESTED AND UNVESTED
STOCK OPTIONS AND CONVERSION OF CONVERTIBLE SECURITIES OR OTHER RIGHTS TO
PURCHACE OR ACQUIRE SHARES) (THE "MINIMUM CONDITION") AND (II) RECEIPT BY
PURCHASER, IBA GP, IBA AND THE COMPANY OF CERTAIN GOVERNMENTAL AND REGULATORY
APPROVALS AND CERTAIN OTHER CONDITIONS. SEE "THE TENDER OFFER--15. CERTAIN
CONDITIONS OF THE OFFER."
THE OFFER DOES NOT CONSTITUTE A SOLICITATION OF PROXIES FOR ANY MEETING OF
THE COMPANY'S STOCKHOLDERS. ANY SUCH SOLICITATION, IF NECESSARY, WOULD BE MADE
ONLY PURSUANT TO SEPARATE PROXY MATERIALS COMPLYING WITH THE REQUIREMENTS OF
SECTION 14(a) OF THE SECURITIES EXCHANGE AS AMENDED (THE "EXCHANGE ACT").
The Offer will expire at Midnight, New York City time, on Thursday, July 15,
1999, unless extended.
Tendering stockholders will not be obligated to pay brokerage commissions,
solicitation fees or, subject to Instruction 6 of the Letter of Transmittal,
stock transfer taxes on the purchase of Shares pursuant to the Offer. However,
any tendering stockholder or other payee who fails to complete and sign the
Substitute Form W-9 that is included in the Letter of Transmittal may be subject
to a required backup federal income tax withholding of 31% of the gross proceeds
payable to such stockholder or other payee pursuant to the Offer. See "THE
TENDER OFFER--5. Certain Federal Income Tax Consequences." Purchaser will pay
all charges and expenses of IBJ Whitehall Bank and Trust Company, as depositary
(in such capacity, the "Depositary"), Bear, Stearns & Co. Inc., as dealer
manager (in such capacity, the "Dealer Manager"), and MacKenzie Partners, Inc.,
as Information Agent (in such capacity, the "Information Agent"), incurred in
connection with the Offer. For a description of the fees and expenses to be paid
by Purchaser, see "THE TENDER OFFER--17. Fees and Expenses."
Consummation of the Merger is subject to a number of conditions, including
approval by the stockholders of the Company if such approval is required by
applicable law. If the Minimum Condition is satisfied, Purchaser and Parent
together will have sufficient voting power to approve and adopt the Merger
Agreement and the Merger at a stockholders' meeting without the vote of any
other stockholder of the Company. Under the Delaware General Corporation Law
(the "DGCL"), if, after consummation of the Offer, Purchaser owns at least 90%
of the then outstanding Shares, Purchaser and Parent will be able to cause the
Merger to occur without a vote of the Company's stockholders. If, however, after
consummation
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of the Offer, the Purchaser owns less that 90% of the then outstanding Shares, a
vote of the Company's stockholders will be required under the DGCL to approve
the Merger.
The Company has informed IBA that as of May 31, 1999, there were 8,005,802
Shares issued and outstanding and 1,182,210 Shares reserved for issuance upon
the exercise of outstanding Company stock options. As of the date hereof, Parent
and its affiliates beneficially own 3,245,612 Shares, taking into account the
751,300 Shares owned by Parent and the 2,494,312 Shares which are the subject of
the proxy and option granted to Parent under the Stockholders' Agreement. Based
on the foregoing, and assuming no additional Shares (or warrants, options or
rights exercisable for, or securities convertible into, Shares) have been issued
(other than Shares issued pursuant to such options and rights referred to
above), if Purchaser were to acquire 3,842,707 Shares pursuant to the Offer
(including the Shares that, pursuant to the Stockholders' Agreement, are
required to be tendered in response to the Offer), the Purchaser and the Parent
together would own a majority of the Shares outstanding on a diluted basis and
the Minimum Condition would be satisfied.
The information contained in this Offer to Purchase concerning the Company
was supplied by the Company. Purchaser takes no responsibility for the
completeness or accuracy of such information. The information contained in this
Offer to Purchase concerning the Offer, the Merger, IBA, IBA GP, Belgabeam SCRL
and Purchaser was supplied by Parent. The Company takes no responsibility for
the completeness or accuracy of such information.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION WHICH SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE
WITH RESPECT TO THE OFFER. ALSO SEE "THE TENDER OFFER--18. MISCELLANEOUS" FOR
INFORMATION REGARDING CERTAIN ADDITIONAL DOCUMENTS FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION (THE "COMMISSION") IN CONNECTION WITH THE OFFER.
Unless the context indicates otherwise, references herein to Parent shall
include IBA and all of its subsidiaries including Purchaser.
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THE TENDER OFFER
1. TERMS OF THE OFFER; EXPIRATION DATE
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any such extension or
amendment), Purchaser will accept for payment and pay for all Shares validly
tendered on or prior to the Expiration Date and not withdrawn in accordance with
the provisions set forth in this Offer to Purchase under the caption "THE TENDER
OFFER--3. Withdrawal Rights." The term "Expiration Date" shall mean Midnight,
New York City time, on Thursday, July 15, 1999, unless and until Purchaser,
subject to restrictions contained in the Merger Agreement, shall from time to
time have extended the period of time during which the Offer is open, in which
event the term "Expiration Date" shall mean the latest time and date at which
the Offer, as so extended by Purchaser, shall expire.
The offer is subject to certain conditions set forth in "THE TENDER
OFFER--15. Certain Conditions of the Offer," including satisfaction of the
Minimum Condition and the expiration or termination of any waiting period under
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR
Act"). If any such condition is not satisfied prior to the expiration of the
Offer, Purchaser may, subject to the terms of the Merger Agreement, (i)
terminate the Offer and return all tendered Shares to tendering stockholders,
(ii) extend the Offer and, subject to withdrawal rights as set forth in "THE
TENDER OFFER--3. Withdrawal Rights," retain all such Shares until the expiration
of the Offer as so extended, (iii) waive such condition (other than the Minimum
Condition) and, subject to any requirement to extend the period of time during
which the Offer is open, purchase all Shares validly tendered and not withdrawn
by the Expiration Date or (iv) delay acceptance for payment of (whether or not
the Shares have theretofore been accepted for payment), or payment for, any
Shares tendered and not withdrawn, subject to applicable law, until satisfaction
or waiver of the conditions to the Offer.
Pursuant to the Merger Agreement, Purchaser may increase the Offer Price and
may make any other changes in the terms and conditions of the Offer, provided
that, unless previously approved by the Company in writing, Purchaser may not
(i) decrease the Offer Price, (ii) change the form of consideration payable in
the Offer, (iii) reduce the number of Shares required to satisfy the Minimum
Condition, (iv) reduce the maximum number of Shares to be purchased in the
Offer, (v) add conditions to the Offer in addition to those set forth in Article
7 of the Merger Agreement, (vi) otherwise modify or amend those conditions in a
manner that is materially adverse to the holders of the Shares, or (vii) extend
the Expiration Date beyond September 30, 1999 (except to the extent required to
comply with any rule, regulation or interpretation of the Commission or to
satisfy the conditions to the Offer).
Subject to the terms and conditions of the Merger Agreement, Purchaser may,
without the consent of the Company's Board of Directors, from time to time
extend the Expiration Date. Purchaser confirms that its right to delay payment
for Shares that it has accepted for payment is limited by Rule 14e-1(c) under
the Exchange Act, which requires that a tender offeror pay the consideration
offered or return the tendered securities promptly after the termination or
withdrawal of a tender offer. Under no circumstances will interest be paid on
the purchase price for tendered Shares, whether or not Purchaser exercises its
right to extend the Offer.
Subject to the applicable rules and regulations of the Commission, Purchaser
expressly reserves the right, subject to the terms and conditions of the Merger
Agreement, at any time and from time to time, upon the failure to be satisfied
of any of the conditions to the Offer, to (i) terminate or amend the Offer, (ii)
extend the Offer and postpone acceptance for payment of any Shares, or (iii)
waive any condition to completion of the Offer. During any such extension all
Shares previously tendered and not properly withdrawn will remain subject to
such extension and to the Offer, subject further to the right of a tendering
stockholder to withdraw such stockholder's Shares. Parent may not terminate the
Merger Agreement due to a failure to obtain clearance under the HSR Act until
December 31, 1999; provided, however at any time after March 31, 2000, the
Company may terminate the Merger Agreement due to a failure to obtain
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<PAGE>
clearance under the HSR Act. In the event that Purchaser waives any of the
conditions set forth in this Offer to Purchase under the caption "THE TENDER
OFFER--15. Certain Conditions Of The Offer," the Commission may, if the waiver
is deemed to constitute a material change to the information previously provided
to the stockholders, require that the Offer remain open for an additional period
of time and/or that Purchaser disseminate information concerning such waiver.
If Purchaser extends the Offer, or if Purchaser (whether before or after its
acceptance for payment of Shares) is delayed in its payment for Shares or is
unable to pay for Shares pursuant to the Offer for any reason, then, without
prejudice to Purchaser's rights under the Offer, the Depositary may retain
tendered Shares on behalf of Purchaser, and such Shares may not be withdrawn
except to the extent tendering stockholders are entitled to withdrawal rights as
described in this Offer to Purchase under the caption "THE TENDER OFFER--3.
Withdrawal Rights." However, as described above, the ability of Purchaser to
delay payment for Shares that Purchaser has accepted for payment is limited by
Rule 14e-1(c) under the Exchange Act.
If Purchaser makes a material change in the terms of the Offer or the
information concerning the Offer or waives a material condition of the Offer,
Purchaser will disseminate additional tender offer materials (including by
public announcement) and extend the Offer to the extent required by Rules
14d-4(c), 14d-6(d) and 14e-1 under the Exchange Act. Such rules generally
provide that the minimum period during which a tender offer must remain open
following a material change in the terms of the offer or information concerning
the offer, other than a change in price or a change in percentage of securities
sought, will depend upon the facts and circumstances, including the relative
materiality of the changes in the terms or information. In the Commission's
view, an offer should remain open for a minimum of five business days from the
date a material change is first published, sent or given to security holders,
and, if material changes are made with respect to information that approaches
the significance of price and share levels, a minimum of ten business days may
be required to allow for adequate dissemination and investor response. With
respect to a change in price or a change in percentage of securities sought, a
minimum ten-business-day period is generally required to allow for adequate
dissemination to stockholders and for investor response.
Any extension, amendment or termination of the Offer will be followed as
promptly as practicable by public announcement in accordance with the public
announcement requirements of Rule 14e-1(d) under the Exchange Act. Subject to
applicable law (including Rules 14d-4(c) and 14d-6(d) under the Exchange Act,
which require that any material change in the information published, sent or
given to stockholders in connection with the Offer be promptly disseminated to
stockholders in a manner reasonably designed to inform stockholders of such
change) and without limiting the manner in which Purchaser may choose to make
any public announcement, Purchaser shall have no obligation to publish,
advertise or otherwise communicate any such public announcement other than by
making a release to the Dow Jones News Service.
The Company has provided Purchaser with the Company's stockholder list, a
non-objecting beneficial owners list, and security position listings for the
purpose of disseminating the Offer to holders of Shares. This Offer to Purchase
and the Letter of Transmittal and other relevant materials will be mailed to
record holders of Shares and furnished to brokers, dealers, commercial banks,
trust companies and similar persons whose names, or the names of whose nominees,
appear on the stockholder list or, if applicable, who are listed as participants
in a clearing agency's security position listing, for subsequent transmittal to
beneficial owners of Shares.
2. PROCEDURE FOR ACCEPTING THE OFFER AND TENDERING SHARES
VALID TENDER OF SHARES
For a stockholder to validly tender Shares pursuant to the Offer, either (i)
a properly completed and duly executed Letter of Transmittal (or facsimile
thereof), together with any required signature guarantees,
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<PAGE>
or an Agent's Message (as defined herein) in connection with a book-entry
delivery of Shares, and any other required documents, must be received by the
Depositary at one of its addresses set forth on the back cover of this Offer to
Purchase, and either certificates ("Share Certificates") for tendered Shares
must be received by the Depositary at one of such addresses or such tendered
Shares must be delivered pursuant to the procedure for book-entry transfer set
forth below (and a Book-Entry Confirmation (as defined herein) received by the
Depositary), in each case prior to the Expiration Date, or (ii) the tendering
stockholder must comply with the guaranteed delivery procedures set forth below.
BOOK-ENTRY TRANSFERS
The Depositary will establish an account with respect to the Shares at The
Depositary Trust Company (the "Book-Entry Transfer Facility") for purposes of
the Offer within two business days after the date of this Offer to Purchase. Any
financial institution that is a participant in the Book-Entry Transfer Facility
system may make book-entry delivery of the Shares by causing the Book-Entry
Transfer Facility system to transfer such Shares into the Depositary's account
at a Book-Entry Transfer Facility in accordance with such Book-Entry Transfer
Facility's procedure for such transfer. Although delivery of Shares may be
effected through book-entry transfer at any Book-Entry Transfer Facility, a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof), with any required signature guarantees, or an Agent's Message (as
defined herein) in connection with a book-entry transfer, and any other required
documents, must, in any case, be transmitted to, and received by, the Depositary
at one of its addresses set forth on the back cover of this Offer to Purchase
prior to the Expiration Date, or the tendering stockholder must comply with the
guaranteed delivery procedures described below. The confirmation of a book-entry
transfer of Shares into the Depositary's account at a Book-Entry Transfer
Facility as described above is referred to herein as a "Book-Entry
Confirmation." DELIVERY OF DOCUMENTS TO A BOOK-ENTRY TRANSFER FACILITY IN
ACCORDANCE WITH ITS BOOK-ENTRY PROCEDURES DOES NOT CONSTITUTE VALID DELIVERY TO
THE DEPOSITARY.
The term "Agent's Message" means a message, transmitted by a Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of the
Book-Entry Confirmation, which states that the Book-Entry Transfer Facility has
received an express acknowledgment from the participant in the Book-Entry
Transfer Facility tendering the Shares, that such participant has received the
Letter of Transmittal and agrees to be bound by the terms of the Letter of
Transmittal and that Purchaser may enforce such agreement against such
participant.
THE METHOD OF DELIVERY OF SHARES, THE LETTER OF TRANSMITTAL AND ALL OTHER
REQUIRED DOCUMENTS IS AT THE ELECTION AND SOLE RISK OF THE TENDERING STOCKHOLDER
AND DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED AT THE DEPOSITARY.
IF DELIVERY IS BY MAIL, THEN INSURED OR REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
ENSURE TIMELY DELIVERY.
SIGNATURE GUARANTEES
No signature guarantee on the Letter of Transmittal is required if (i) the
Letter of Transmittal is signed by the registered holder of the Shares (which
term, for purposes of this Section, includes any participant in a Book-Entry
Transfer Facility system whose name appears on a security position listing as
the owner of the Shares) tendered therewith and such registered holder has not
completed either the box entitled "Special Delivery Instructions" or the box
entitled "Special Payment Instructions" on such Letter of Transmittal, or (ii)
such Shares are tendered for the account of a bank, broker, dealer, credit
union, savings association or other entity that is a member in good standing of
the Securities Transfer Agents Medallion Program, the New York Stock Exchange
Medallion Signature Guarantee Program or the Stock Exchange Medallion Program
(each, an "Eligible Institution"). In all other cases, all signatures on the
Letter of Transmittal must be guaranteed by an Eligible Institution. See
Instructions 1 and 5 to the Letter
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of Transmittal. If the Share Certificates are registered in the name of a person
other than the signer of the Letter of Transmittal, or if payment is to be made
to, or Share Certificates not validly tendered, not accepted for payment or not
purchased are to be issued or returned to, a person other than the registered
holder of the Share Certificates, the tendered Share Certificates must be
endorsed in blank or accompanied by appropriate stock powers, signed exactly as
the name of the registered holder appears on the Share Certificates with the
signature on such Share Certificates or stock powers guaranteed by an Eligible
Institution. See Instructions 1 and 5 to the Letter of Transmittal.
GUARANTEED DELIVERY
If a stockholder desires to tender Shares pursuant to the Offer and such
stockholder's Share Certificates are not immediately available or the procedures
for book-entry transfer cannot be completed on a timely basis or time will not
permit all required documents to reach the Depositary prior to the Expiration
Date, such Shares may nevertheless be tendered provided that all of the
following guaranteed delivery procedures are duly complied with:
(a) such tender is made by or through an Eligible Institution;
(b) the Depositary receives (by hand, mail, telegram or facsimile
transmission) on or prior to the Expiration Date, a properly
completed and duly executed Notice of Guaranteed Delivery,
substantially in the form provided by Purchaser; and
(c) the Share Certificates representing all tendered Shares, in proper
form for transfer (or Book-Entry Confirmation with respect to such
Shares), together with a properly completed and duly executed Letter
of Transmittal (or facsimile thereof) and any other documents
required by the Letter of Transmittal, are received by the Depositary
within three Nasdaq trading days after the date of such Notice of
Guaranteed Delivery. A "Nasdaq trading day" is any day on which
securities are traded on the Nasdaq National Market.
The Notice of Guaranteed Delivery may be delivered by hand, or may be
transmitted by telegram, facsimile transmission or mail, to the Depositary and
must include a guarantee by an Eligible Institution in the form set forth in
such Notice of Guaranteed Delivery.
Notwithstanding any other provision hereof, payment for Shares accepted for
payment pursuant to the Offer will in all cases be made only after timely
receipt by the Depositary of (i) Share Certificates for (or a timely Book-Entry
Confirmation with respect to) such Shares, (ii) a properly completed and duly
executed Letter of Transmittal (or facsimile thereof), or, in the case of
book-entry transfer, an Agent's Message, and (iii) any other documents required
by the Letter of Transmittal. Accordingly, tendering stockholders may be paid at
different times depending upon when Share Certificates, Book-Entry Confirmations
and such other documents are actually received by the Depositary. Under no
circumstances will interest be paid by Purchaser on the purchase price of the
Shares to any tendering stockholders, regardless of any extension of the Offer
or any delay in making such payment.
DETERMINATION OF VALIDITY
All questions as to the validity, form, eligibility (including time of
receipt) and acceptance for payment of any tender of Shares will be determined
by Purchaser in its sole discretion, which determination will be final and
binding. Purchaser reserves the absolute right to reject any or all tenders of
any Shares that it determines are not in proper form or the acceptance for
payment of or payment for which may, in the opinion of Purchaser's counsel, be
unlawful. Purchaser also reserves the absolute right to waive any of the
conditions of the Offer or any defect or irregularity in the tender of any
Shares with respect to any particular stockholder, whether or not similar
defects or irregularities are waived in the case of other stockholders. None of
Purchaser, IBA, the Depositary, the Information Agent, the Dealer Manager or any
other person will be under any duty to give notice of any defects or
irregularities in tenders or incur any
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liability for failure to give any such notice. Purchaser's interpretation of the
terms and conditions of the Offer (including the Letter of Transmittal and the
instructions thereto) will be final and binding.
OTHER REQUIREMENTS
By executing the Letter of Transmittal as set forth herein, a tendering
stockholder irrevocably appoints designees of Purchaser as such stockholder's
proxies, each with full power of substitution, in the manner set forth in the
Letter of Transmittal, to the full extent of such stockholder's rights with
respect to the Shares tendered by such stockholder and accepted for payment by
Purchaser (and with respect to any and all other Shares or other securities or
rights issued or issuable in respect of such Shares on or after June 10, 1999),
effective when, if and to the extent that Purchaser accepts such Shares for
payment pursuant to the Offer. All such proxies shall be considered coupled with
an interest in the tendered Shares. Upon such acceptance for payment, all prior
proxies given by such stockholder with respect to such Shares accepted for
payment or other securities or rights will, without further action, be revoked,
and no subsequent proxies may be given. Such designees of Purchaser will, with
respect to such Shares for which the appointment is effective, be empowered to
exercise all voting and other rights of such stockholder as they in their sole
discretion may deem proper in respect of any annual or special meeting of the
Company's stockholders or any adjournment or postponement thereof. Purchaser
reserves the right to require that, in order for Shares to be deemed validly
tendered, immediately upon Purchaser's payment for such Shares, Purchaser must
be able to exercise full voting rights with respect to such Shares.
Purchaser's acceptance for payment of Shares tendered pursuant to any of the
procedures described herein will constitute a binding agreement between the
tendering stockholder and Purchaser upon the terms and subject to the conditions
of the Offer.
BACKUP FEDERAL INCOME TAX WITHHOLDING
To prevent backup federal income tax withholding on payments of cash
pursuant to the Offer, a stockholder (other than certain exempt stockholders,
including, among others, all corporations and certain foreign individuals and
entities) tendering Shares in the offer must provide the Depositary with such
stockholder's correct taxpayer identification number ("TIN") on a Substitute
Form W-9 and certify under penalties of perjury that such TIN is correct and
that such stockholder is not subject to backup withholding. If a stockholder
does not provide its correct TIN or fails to provide the certification described
herein, under federal income tax laws, the Depositary will be required to
withhold 31% of the amount of any payment made to such stockholder pursuant to
the Offer. All stockholders (other than stockholders providing Form W-8)
tendering Shares pursuant to the Offer should complete and sign the Substitute
Form W-9 included as a part of the Letter of Transmittal to provide the
information and certification necessary to avoid backup withholding. Certain
stockholders (including, among others, all corporations and certain foreign
individuals and entities) are not subject to backup withholding. See Instruction
10 to the Letter of Transmittal. A stockholder who does not furnish its TIN may
be subject to penalties imposed by the Internal Revenue Service (the "IRS").
Noncorporate foreign stockholders should complete and sign a Form W-8,
Certificate of Foreign Status, a copy of which may be obtained from the
Depositary, in order to avoid backup withholding.
3. WITHDRAWAL RIGHTS
Shares tendered may be withdrawn at any time prior to the Expiration Date.
Thereafter, such tenders are irrevocable, except that they may be withdrawn at
any time after Sunday, August 15, 1999 if they have not been accepted for
payment as provided in this Offer to Purchase.
For a withdrawal to be effective, a written, telegraphic or facsimile
transmission notice of withdrawal must be timely received by the Depositary at
one of its addresses set forth on the back cover of this Offer to Purchase. Any
notice of withdrawal must specify the name of the person who tendered the Shares
to be
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withdrawn, the number of Shares to be withdrawn and the name of the registered
holder of the Shares to be withdrawn as set forth on such Share Certificates if
different from the name of the person who tendered such Shares. If Share
Certificates have been delivered or otherwise identified to the Depositary,
then, prior to the physical release of such Share Certificates, the serial
numbers shown on such Share Certificates must be furnished to the Depositary
and, unless such Shares have been tendered by an Eligible Institution, the
signatures on the notice of withdrawal must be guaranteed by an Eligible
Institution. If Shares have been delivered pursuant to the procedures for
book-entry transfer set forth in Section 2 above, any notice of withdrawal must
specify the name and number of the account at the appropriate Book-Entry
Transfer Facility to be credited with such withdrawn Shares and otherwise comply
with such Book-Entry Transfer Facility's procedures for withdrawal, in which
case a notice of withdrawal will be effective if delivered to the Depositary by
any method of delivery described in the first sentence of this paragraph.
All questions as to the form and validity (including time of receipt) of
notices of withdrawal will be determined by Purchaser in its sole discretion,
and its determination will be final and binding. None of Purchaser, Parent, the
Depositary, the Information Agent, the Dealer Manager or any other person will
be obligated to give notice of any defects or irregularities in any notice of
withdrawal, nor shall any of them incur any liability for failure to give any
such notice.
Withdrawals of tenders of Shares may not be rescinded, and any Shares
properly withdrawn will thereafter be deemed not validly tendered for purposes
of the Offer. However, withdrawn Shares may be retendered by following one of
the procedures described in Section 2 above at any time on or prior to the
Expiration Date.
4. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any extension or
amendment), promptly after the Expiration Date, Purchaser will accept for
payment, and will pay for, any and all Shares validly tendered on or prior to
the Expiration Date and not properly withdrawn in accordance with Section 3
above. All questions as to the satisfaction of such terms and conditions will be
determined by Purchaser, in its sole discretion, which determination shall be
final and binding. See "THE TENDER OFFER--1. Terms Of The Offering; Expiration
Date" and "THE TENDER OFFER--15. Certain Conditions Of The Offer." Subject to
applicable rules of the Commission and the terms and conditions of the Merger
Agreement, Purchaser expressly reserves the right, in its sole discretion, to
delay acceptance for payment of, or payment for, Shares in order to comply in
whole or in part with any applicable law. Any such delay will be effected in
compliance with Rule 14e-1(c) under the Exchange Act.
In all cases, payment for Shares tendered and accepted for payment pursuant
to the Offer will be made only after timely receipt by the Depositary of (i) the
Share Certificates (or timely Book-Entry Confirmation of the book-entry transfer
of such Shares into the Depositary's account at a Book-Entry Transfer Facility
pursuant to the procedures set forth under Section 2 above), (ii) the Letter of
Transmittal (or facsimile thereof), properly completed and duly executed,
together with any required signature guarantees, or an Agent's Message in
connection with a book-entry transfer, and (iii) any other documents required by
the Letter of Transmittal.
For purposes of the Offer, Purchaser will be deemed to have accepted for
payment, and thereby purchased, Shares validly tendered to Purchaser and not
properly withdrawn as, if and when Purchaser gives oral or written notice to the
Depositary of Purchaser's acceptance for payment of such Shares pursuant to the
Offer. In all cases, upon the terms and subject to the conditions of the Offer,
payment for Shares so accepted for payment will be made by the deposit of the
purchase price therefor with the Depositary, which will act as agent for
tendering stockholders for the purpose of receiving payment from Purchaser and
transmitting payment to validly tendering stockholders. UNDER NO CIRCUMSTANCES
WILL INTEREST BE PAID BY PURCHASER ON THE PURCHASE PRICE OF THE SHARES
9
<PAGE>
TENDERED PURSUANT TO THE OFFER, REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY
DELAY IN MAKING SUCH PAYMENT. Upon the deposit of funds with the Depositary for
the purpose of making payments to tendering stockholders, Purchaser's obligation
to make such payments shall be satisfied and tendering stockholders must
thereafter look solely to the Depositary for payment of amounts owed to them by
reason of the acceptance for payment of Shares pursuant to the Offer. Purchaser
will pay any stock transfer taxes with respect to the transfer and sale to it or
its order pursuant to the Offer, except as otherwise provided in Instruction 6
of the Letter of Transmittal.
If Purchaser is delayed in its acceptance for payment of, or payment for,
tendered Shares or is unable to accept for payment or pay for such Shares
pursuant to the Offer for any reason, then, without prejudice to Purchaser's
rights under the Offer (but subject to Purchaser's obligations under Rule
14e-1(c) under the Exchange Act to pay for or return the tendered Shares
promptly after the termination or withdrawal of the Offer), the Depositary may,
nevertheless, retain tendered Shares on behalf of Purchaser, and such Shares may
not be withdrawn except to the extent tendering stockholders are entitled to
exercise, and duly exercise, withdrawal rights as described under Section 3
above.
If any tendered Shares are not purchased pursuant to the Offer because of an
invalid tender or for any reason, Share Certificates for any such Shares will be
returned, without expense, to the tendering stockholder (or, in the case of
Shares delivered by book-entry transfer of such Shares into the Depositary's
account at a Book-Entry Transfer Facility pursuant to the procedures set forth
under Section 2 above, such Shares will be credited to an account maintained at
such Book-Entry Transfer Facility) as promptly as practicable following the
expiration or termination of the Offer.
5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The summary of federal income tax consequences set forth below is for
general information only and is based on Purchaser's understanding of the law as
currently in effect. The tax consequences to each stockholder will depend in
part upon such stockholder's particular situation. Special tax consequences not
described herein may be applicable to particular classes of taxpayers, such as
financial institutions, broker-dealers, persons who are not citizens or
residents of the United States and stockholders who acquired their Shares
through the exercise of an employee stock option or otherwise as compensation.
ALL STOCKHOLDERS SHOULD CONSULT WITH THEIR OWN TAX ADVISORS AS TO THE PARTICULAR
TAX CONSEQUENCES OF THE OFFER AND THE MERGER, INCLUDING THE APPLICABILITY AND
EFFECT OF THE ALTERNATIVE MINIMUM TAX AND ANY STATE, LOCAL OR FOREIGN INCOME AND
OTHER TAX LAWS AND OF CHANGES IN SUCH TAX LAWS.
The receipt of cash for Shares pursuant to the Offer (or the Merger) will be
a taxable transaction for federal income tax purposes and may also be a taxable
transaction under applicable state, local or foreign tax laws. Generally, for
federal tax purposes, a stockholder who receives cash for Shares pursuant to the
Offer (or the Merger) will recognize gain or loss for federal income tax
purposes equal to the difference between the amount of cash received in exchange
for the Shares sold and such stockholder's adjusted tax basis in such Shares.
Provided that the Shares constitute capital assets in the hands of the
stockholder, such gain or loss will be capital gain or loss, and will be long
term capital gain or loss if the holder has held the Shares for more than one
year at the time of sale. Gain or loss will be calculated separately for each
block of Shares (i.e., a group of Shares with the same tax basis and holding
period) tendered pursuant to the Offer.
A stockholder (other than certain exempt stockholders including, among
others, all corporations and certain foreign individuals and entities) that
tenders Shares may be subject to 31% backup withholding unless the stockholder
provides its TIN and certifies that such number is correct or properly certifies
that it is awaiting a TIN, or unless an exemption applies. A stockholder who
does not furnish its TIN may be subject to a penalty imposed by the Internal
Revenue Service (the "IRS"). See Section 2.
10
<PAGE>
If backup withholding applies to a stockholder, the Depositary is required
to withhold 31% from payments to such stockholder. Backup withholding is not an
additional tax. Rather, the amount of the backup withholding can be credited
against the federal income tax liability of the person subject to the backup
withholding, provided that the required information is given to the IRS. If
backup withholding results in an overpayment of tax, a refund can be obtained by
the stockholder upon filing an appropriate income tax return.
6. PRICE RANGE OF THE SHARES
The Shares are traded on the Nasdaq National Market under the symbol "STER."
The Shares began trading on the Nasdaq National Market on August 13, 1997. The
following table sets forth, for the periods indicated, the high and low closing
sales prices per share as reported on the Nasdaq National Market according to
published sources:
<TABLE>
<CAPTION>
CLOSING SALES PRICES
--------------------
<S> <C> <C>
HIGH LOW
--------- ---------
Fiscal Year ended March 31, 1998:
Second Quarter ended September, 30, 1997..................................................... $ 17.88 $ 12.00
Third Quarter ended December 31, 1997........................................................ $ 23.00 $ 16.13
Fourth Quarter ended March 31, 1998.......................................................... $ 22.00 $ 16.50
Fiscal Year ended March 31, 1999:
First Quarter ended June 30, 1998............................................................ $ 26.25 $ 19.63
Second Quarter ended September 30, 1998...................................................... $ 27.38 $ 16.63
Third Quarter ended December 31, 1998........................................................ $ 26.50 $ 19.25
Fourth Quarter ended March 31, 1999.......................................................... $ 25.25 $ 9.50
</TABLE>
On June 10, 1999, the last full day of trading prior to the date of the
first public announcement of Purchaser's intention to commence the Offer, the
last reported sale price of the Common Stock on the Nasdaq National Market was
$19.50 per share. On June 16, 1999, the last full day of trading before the
commencement of the Offer, according to published sources, the last reported
sale price of the Common Stock on the Nasdaq National Market was $25.1825 per
share. STOCKHOLDERS ARE URGED TO OBTAIN A CURRENT MARKET QUOTATION FOR THE
COMMON STOCK.
7. CERTAIN INFORMATION CONCERNING THE COMPANY
GENERAL
The Company is a Delaware corporation with its principal offices located at
4020 Clipper Court, Fremont, California 94538.
The following information concerning the Company has been taken from or
based on publicly available documents on file with the Commission, other
publicly available information and information provided by the Company. Although
neither Purchaser nor Parent has any knowledge that would indicate that such
information is untrue, neither Purchaser nor Parent takes any responsibility
for, or makes any representation with respect to, the accuracy or completeness
of such information or for any failure by the Company to disclose events that
may have occurred and may affect the significance or accuracy of any such
information but which are unknown to Purchaser or Parent.
The Company is a provider of high-quality contract irradiation and
sterilization service using primarily gamma technology. The Company has 20 years
of experience in the design and development of gamma irradiation facilities and
equipment. In addition to its MEDICAL STERILIZATION DIVISION, serving the
healthcare products market, the Company also maintains an ADVANCED APPLICATIONS
DIVISION, providing microbial
11
<PAGE>
reduction and materials processing services to a variety of markets such as
spices, herbs, botanicals, cosmetics, fresh foods, nutraceuticals, food and
beverage packaging, semiconductor devices, gemstones and industrial materials.
The Company is expanding its network of irradiation facilities both domestically
and internationally. Upon completion of the Company's Thailand complex and its
gamma plants under construction in the United States, the Company will operate a
total of 18 irradiation processing facilities worldwide.
AVAILABLE INFORMATION
The Shares are registered under the Exchange Act. Accordingly, the Company
is subject to the informational filing requirements of the Exchange Act and, in
accordance therewith, is required to file periodic reports, proxy statements and
other information with the Commission relating to its business, financial
condition and other matters. Certain information, as of particular dates,
concerning the Company's directors and officers (including their compensation,
stock options granted to them and shares held by them), the principal holders of
the Company's securities, and any material interest of such persons in
transactions with the Company is required to be disclosed in proxy statements
and annual reports distributed to the Company's stockholders and filed with the
Commission. Such reports, proxy statements and other information are available
for inspection and copying at the public reference facilities of the Commission
located in Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and
at the regional offices of the Commission located in Citicorp Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661, and Seven World Trade
Center, Suite 1300, New York, New York 10048. Copies of this material may also
be obtained by mail, upon payment of the Commission's customary fees from the
Commission's principal office at 450 Fifth Street, N.W., Washington, D.C. 20549.
The Commission also maintains an Internet site on the World Wide Web at
http://www.sec.gov that contains Company reports, proxy statements and other
information, all of which may be printed out via computer with no fees charged.
In addition, such material should also be available for inspection at The Nasdaq
Stock Market, Inc., 1735 K Street, N.W., Washington, D.C. 20006.
SUMMARY FINANCIAL INFORMATION
The following table sets forth certain summary consolidated financial
information with respect to the Company and its consolidated subsidiaries
derived from the audited financial statements contained in the Company's Annual
Report on Form 10-K for the fiscal year ended March 31, 1998 (the latest Form
10-K on file for the Company with the Commission) and the unaudited financial
statements contained in the Company's Quarterly Report on Form 10-Q for the
quarter ended December 31, 1998 (the latest Form 10-Q on file for the Company
with the Commission). More comprehensive financial information is included in
such reports and other documents filed by the Company with the Commission, and
the following summary is qualified in its entirety by reference to such
documents (which may be inspected and obtained as described above), including
the financial statements and related notes contained therein. Neither Parent nor
Purchaser assumes any responsibility for the accuracy of the financial
information set forth below.
12
<PAGE>
THE COMPANY AND SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
NINE MONTHS ENDED
YEAR ENDED MARCH 31, DECEMBER 31,
------------------------------- --------------------
1998 1997 1996 1998 1997
--------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C>
CONSOLIDATED STATEMENT OF OPERATIONS DATA:
Revenues................................................... $ 46,955 $ 37,668 $ 30,241 $ 40,798 $ 33,871
Cost of revenues........................................... 24,231 20,245 16,978 20,660 18,019
--------- --------- --------- --------- ---------
22,724 17,243 13,263 20,138 15,852
Costs and expenses:
General and administrative............................... 7,850 6,345 5,213 6,511 5,048
Marketing and selling.................................... 3,497 2,482 1,761 2,935 2,533
Research, development and engineering.................... 1,229 1,381 890 953 914
--------- --------- --------- --------- ---------
12,576 10,208 7,864 10,399 8,495
--------- --------- --------- --------- ---------
Income from operations..................................... 10,148 7,035 5,399 9,739 7,357
Other income (expense):
Interest income.......................................... 835 343 114 1,394 540
Interest expense......................................... (2,316) (2,179) (1,960) (1,693) (1,908)
Write-down of investments in joint ventures.............. -- -- -- -- --
Other income............................................. 47 115 47 77 32
--------- --------- --------- --------- ---------
Income (loss) before provision for income taxes, equity in
joint ventures and discontinued operations............... 8,714 5,314 3,600 9,517 6,021
Provision for income taxes................................. 3,408 2,099 1,448 3,746 2,356
--------- --------- --------- --------- ---------
Income (loss) before equity in joint ventures and
discounted operations.................................... 5,306 3,215 2,152 -- --
Equity in net loss of joint ventures....................... -- -- -- -- --
--------- --------- --------- --------- ---------
Income (loss) from continuing operations................... 5,306 3,215 2,152 -- --
Discontinued operations:
Income (loss) from discontinued operations............... -- -- -- -- --
Loss on disposition of discontinued operations........... -- -- -- -- --
--------- --------- --------- --------- ---------
Net income (loss).......................................... $ 5,306 $ 3,215 $ 2,152 $ 5,771 $ 3,665
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
Pro forma basic net income per share (1)................... $ 0.86 $ 0.66 $ -- $ -- $ 0.63
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
Basic net income per share................................. -- -- -- $ 0.74 --
--------- --------- --------- --------- ---------
Shares used in computing pro forma basic net income per
share (1)................................................ 6,181 4,861 $ -- $ -- 5,846
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
Diluted net income per share (1)........................... $ 0.79 $ 0.62 $ -- $ 0.69 $ 0.58
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
Shares used in computing diluted net income per share
(1)...................................................... 6,711 5,165 $ -- 8,360 6,350
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
CONSOLIDATED BALANCE SHEET DATA:
Cash and cash equivalents.................................. $ 12,660 $ 1,957 $ 9,906 $ 33,641 $ 22,183
--------- --------- --------- --------- ---------
--------- --------- --------- --------- ---------
Working capital (deficit).................................. 29,785 (3,047) 3,329 -- --
Total assets........................................... 130,675 91,667 84,729 134,974 121,486
Total liabilities...................................... 60,984 59,187 55,464 57,740 63,329
Redeemable preferred stock................................. -- 1,500 1,500 -- --
Stockholders' equity....................................... 69,691 30,980 27,765 77,054 58,157
</TABLE>
13
<PAGE>
(1) Basic net income per share is computed using the weighted average number of
shares outstanding during the period, except as noted in the notes to
Consolidated Financial Statements contained in the Company's publicly filed
quarterly and annual reports. Pro forma basic net income per share is
calculated as for basic net income per share, but assumes conversion of all
convertible preferred stock, which converted automatically in the initial
public offering, even if antidilutive. Diluted net income per share includes
potential common shares when dilutive, from stock options (using the
treasury stock method) and from convertible preferred stock (using the
converted method).
8. CERTAIN INFORMATION CONCERNING PURCHASER AND PARENT
GENERAL
IBA is a world leader in the design and manufacture of particle accelerators
for the medical and industrial sectors. Since its creation in 1986, IBA has
designed approximately ten types of high performance accelerators which are the
standard in their respective markets. Several units of each model are either in
operation or being installed in seventeen countries on four continents. IBA's
products are used in research, medicine and industry. The principal executive
offices of IBA are located at Chemis du Cyclotron 3, B-1348 Louvain-la-Neuve,
Belgium.
The Purchaser, a Delaware corporation, was recently incorporated for the
purpose of making the Offer for the Shares of the Company. Purchaser has not
conducted any other business. The principal executive offices of Purchaser are
located at Chemin du Cyclotron, 3, B-1348 Louvain-la-Neuve, Belgium. All
outstanding shares of common stock of Purchaser are directly owned by IBA GP.
IBA GP, a Delaware general partnership, the controlling general partner of
which is Parent, was formed to hold the shares of all of the U.S. operating
subsidiaries of Parent, including Purchaser. Belgabeam SCRL, the largest single
shareholder of Parent, is a Belgian corporation owned primarily by employees of
Parent. It has its principal business and address at Chemin du Cyclotron, 3,
B-1348 Louvain-la-Neuve, Belgium.
The name, business address, present principal occupation or employment,
five-year employment history and citizenship of each of the directors and
executive officers of Purchaser, Parent and Belgabeam SCRL and the directors and
officers of the partners of IBA GP, as well as the name, principal business and
address of the corporation or other organization in which such present
occupation or employment is carried on are set forth in Schedule I hereto.
Parent's shares have been quoted on the First Market of the Brussels Stock
Exchange since June 22, 1998 and in March 1999 the Parent's share listing was
transferred from the Brussels Stock Exchange's double-fixing market to the
continuous quote market, where quotes are made without interruption. As on June
14, 1999, the Parent's common stock was traded at approximately U.S.$61.50 per
share.
On December 22, 1998, Parent purchased Mediflash Holding AB, a Swedish group
whose major subsidiaries are Scanditronix Medical AB ("Scanditronix") and
Scandiflash. Scanditronix manufactures a large number of products which are
complementary to those manufactured by Parent, such as electron-beam systems for
on-line sterilizations, high-end conventional radiotherapy systems and dosimetry
systems used for the measurement of doses given in radiotherapy. Scandiflash
carries out mechanical services, and manufactures and markets industrial X-ray
imaging systems.
On May 10, 1999 Parent acquired Radiation Dynamics Inc, a wholly-owned
subsidiary of Sumitomo Heavy Industries, which is a well-established company in
the field of high-power low-energy e-beam accelerators used for heat shrinking
and polymer modification applications in the wire, cable, tubing, tire, film and
foam industries.
On May 15, 1999, Parent acquired Griffith Micro Science International, Inc.
("GMS"), a world leader in medical device sterilization. GMS is headquartered in
Oak Brook, Illinois and is active in carrying out
14
<PAGE>
sterilization management on behalf of other companies. GMS employs approximately
460 people and has a global presence with 19 sterilization centers located in
the United States, Canada, Mexico, Belgium, France, United Kingdom, The
Netherlands and Germany. These centers offer sterilization management services
largely to medical device manufacturers and also provide laboratory, consultancy
management and logistical services. GMS has been active for 60 years, mainly
utilizing sterilization by ethylene oxide, which is one of the two major medical
sterilization markets. Markets are differentiated by the kind of technology used
for such sterilization: treatment by ethylene oxide ("EtO"), and by two forms of
radiation: cobalt irradiation and, more recently electron beams/X-rays.
FINANCIAL INFORMATION FOR PARENT
Parent is exempt from the informational filing requirements of the Exchange
Act. Parent is listed and files financial and other information pursuant to the
requirements of the Brussels Stock Exchange. In May 1999 Parent completed three
acquisitions of privately-held U.S. corporations, and as a result of such
acquisitions, Parent's operations have significantly expanded. Accordingly,
Parent believes that its audited financial statements dated as of December 31,
1998, prepared in accordance with Belgian GAAP and filed with the Brussels Stock
Exchange, would not accurately reflect Parent's current consolidated financial
position. Moreover, because Parent has received a firm loan committment for the
funds necessary to pay for the Shares and the related fees, and expenses of the
Offer, Parent believes that information about its financial condition is not
material to a decision by a stockholder of the Company whether to sell, transfer
or hold any Shares.
Parent has not been required to prepare, and has not prepared, consolidated
financial statements reflecting the financial performance of the corporations
acquired, combined with its own performance.
INTEREST IN SHARES; CONTRACTS AND RELATIONSHIPS WITH RESPECT TO COMPANY
SECURITIES.
As of June 10, 1999, Parent may be deemed to beneficially own in the
aggregate 3,245,612 Shares, representing approximately 40.54% of the outstanding
Shares as at May 31, 1999. Of the 3,245,612 Shares beneficially owned by Parent,
Parent possesses the sole power to dispose of, direct the disposition of and
vote 751,300 Shares (which Parent acquired in open market purchases in March
1999), and possesses the shared power (with the Selling Stockholders) to dispose
of, direct the disposition of and vote 2,494,312 Shares. Belgabeam's beneficial
ownership is indirect through Parent. Parent acquired 751,300 Shares in the the
following open market transactions:
<TABLE>
<CAPTION>
NO. OF PRICE PER
DATE SHARES SHARE WHERE/HOW EFFECTED
- --------- ------------ -------------- ----------------------------------------------------
<S> <C> <C> <C>
3/9/99 330,000 $ 10.25 Open Market Purchase
3/11/99 204,600 $ 10.212688 Open Market Purchase
3/12/99 133,400 $ 11.1475 Open Market Purchase
3/15/99 3,000 $ 11.3125 Open Market Purchase
3/18/99 45,500 $ 11.4945 Open Market Purchase
3/19/99 34,800 $ 11.50 Open Market Purchase
</TABLE>
Except as described in this Offer to Purchase, none of Purchaser, Parent or,
to the best of their knowledge, any of the persons listed on Schedule I or any
associate or wholly-owned or majority-owned subsidiary of the Purchaser, Parent
or any of the persons so listed, beneficially owns or has a right to acquire
directly or indirectly any Shares. Except as described in this Offer to
Purchase, none of Purchaser, Parent or, to the best of their knowledge, any of
the persons or entities referred to above, or any of the respective executive
officers, directors or subsidiaries of any of the foregoing, has effected any
transactions in the Shares during the past sixty (60) days. Philippe Janssens de
Varebeke, who since June 16, 1999 is no longer a member of the Board of
Directors of Parent made the following open market purchases of Common Stock of
the Company on the following dates: 2,000 shares on April 12, 1999 at a price of
$10.25
15
<PAGE>
per share; 7,800 on June 1, 1999 at a price of $16.32 per share and 2,300 shares
on June 2, 1999 at a price of $17.62 per share.
Except as described elsewhere in this Offer to Purchase, none of Purchaser,
Parent or, to the best of their knowledge, any of the persons listed on Schedule
I, has any contract, arrangement, understanding or relationship with any other
person with respect to any securities of the Company, including but not limited
to contracts, arrangements, understandings or relationships concerning the
transfer or voting of such securities, joint ventures, loan or option
arrangements, puts or calls, guarantees of loans, guarantees against loss or the
giving or withholding of proxies.
9. SOURCE AND AMOUNT OF FUNDS
The total amount of funds required by Purchaser and Parent to consummate the
Offer and the Merger (including the cash out of stock options as described in
Section 12) and to pay related fees and expenses is estimated to be
approximately $220 million. The required funds will be provided to Purchaser by
Parent, indirectly via IBA GP through loans, advances or capital contributions.
Such funds are expected to be made available pursuant to a $220 million loan
facility (the "Facility") between the Parent and Bank Brussels Lambert S.A. (the
"Lender"). The Parent has received a commitment letter from the Lender whereby
the Lender agreed that it will provide the Facility. A copy of this letter has
been filed with the Commission as Exhibit (b) to the Schedule 14D-1. Such
borrowings will be secured by Parent's pledge of certain accounts maintained by
Parent with the Lender and the 751,300 Shares currently owned by Parent and any
Shares acquired pursuant to the Offer and will be available for drawdown, in one
advance, at any time to and including December 31, 1999. The loan will be
repayable in full on June 30, 2000, and will bear interest, payable monthly, at
the rate equal to the relevant one-month London Interbank Offered Rate plus
1.00% per annum. The Facility will include other provisions customary for this
type of facility. Parent has not yet determined its plans for refinancing the
borrowings under the Facility.
Neither the Offer nor the Merger are conditioned upon Purchaser or Parent
obtaining financing.
10. CERTAIN TRANSACTIONS BETWEEN IBA AND THE COMPANY
In December 1998, the Company purchased irradiation equipment from Parent
valued at between $3 million and $5 million.
Except as set forth in this Offer to Purchase, since April 1, 1996, none of
Purchaser, Parent or, to the best of their knowledge, any of the persons listed
on Schedule I, has had any business relationships or transactions with the
Company or any of its executive officers, directors or affiliates that are
required to be reported under the rules and regulations of the Commission
applicable to the Offer. Except as set forth in this Offer to Purchase, since
April 1, 1996 there have been no contacts, negotiations or transactions between
any of Parent, the Purchaser or, to the best of their knowledge, any of the
persons listed on Schedule I, on the one hand, and the Company or its
affiliates, on the other hand, concerning a merger, consolidation or
acquisition, a tender offer or other acquisition of securities, an election of
directors, or a sale or other transfer of a material amount of assets.
11. CONTACTS WITH THE COMPANY; BACKGROUND OF THE OFFER AND THE MERGER
On October 28, 1998, James F. Clouser, Chief Executive Officer of the
Company and Pierre Mottet, Chief Executive Officer of Parent met in Phoenix,
Arizona to discuss various subjects, including the possible purchase of
equipment from the Parent by the Company. They also generally discussed the
possibility of combining the Parent and the Company.
In December 1998 the Company entered into an agreement to purchase certain
irradiation equipment from the Parent.
16
<PAGE>
On January 7, 1999, IBA retained Bear, Stearns International Limited ("Bear
Stearns") as exclusive financial advisor. Bear Stearns and IBA subsequently
conducted a review of IBA's strategy including, among other things, a review of
potential acquisitions. The Company had previously retained PaineWebber
Incorporated ("PaineWebber") and TM Capital Corporation ("TM Capital") as
financial advisors in connection with evaluating potential Strategic
Transactions.
On January 25, 1999, Mr. Clouser, and Mr. Mottet and Yves Jongen the
President of the Parent met in Hayward, California and had preliminary
discussions concerning a potential acquisition of the Company by the Parent. On
February 2, 1999, the Company provided Parent with a non-disclosure and stand
still agreement. In the course of those discussions Mr. Clouser indicated that
the Company might be willing to consult in a sale of the Company and suggested a
valuation in excess of $30 per share.
On March 5, 1999, Mr. Mottet informed Mr. Clouser that the parent did not
wish to pursue an acquisition of the Company and did not sign the non-disclosure
agreement.
During February 1999, Mr. Mottet and Mr. Clouser also exchanged e-mails
regarding potential synergies in the business.
In early March 1999, following a significant decline in the trading price of
the Company's shares of Common Stock, Parent purchased in the open market
751,300 shares of the Company's Common Stock, which represents approximately
9.4% of the currently outstanding Shares.
On March 17, 1999, Mr. Mottet contacted Mr. Clouser, who was then at a
business meeting in Australia, to discuss Parent's recent acquisition of its
stock of the Company. Mr. Mottet confirmed to Mr. Clouser that, though Parent
had previously evaluated a potential acquisition of the Company, Parent's recent
stake in the Company was acquired for investment purposes and that there were no
plans to increase Parent's stake in the Company.
On April 15, 1999, Parent signed a definitive agreement to acquire all of
the outstanding capital stock of Griffith Micro Sciences International, a
Chicago-based Eto sterilization services company.
On April 16, 1999, Parent issued a press release announcing the signing of
the agreement to acquire Griffin Micro Sciences International.
On April 20, 1999, Mr. Clouser contacted Mr. Mottet to advise him that,
following the announcement of Parent's definitive agreement to acquire Griffith
Micro Sciences, a number of parties had approached the Company and that the
willingness of the Company to consider these approaches might eventually lead to
a potential sale.
On April 20, 1999, PaineWebber Incorporated contacted Bear Stearns and
confirmed that the Company would be interested in pursuing a potential business
combination with the Parent.
On May 13, 1999, Mr. Mottet met with Mr. Clouser in Washington, D.C. and
advised Mr. Clouser that the Parent was interested in conducting a preliminary
evaluation of a potential acquisition of the Company by Parent. Subsequent
discussions took place between Parent, the Company and their financial advisors,
which led to the execution on May 17, 1999 of a non-disclosure agreement (the
"Confidentiality Agreement").
From May 20 to May 23, 1999, associates of Parent's legal counsel, Dorsey &
Whitney LLP, conducted preliminary due diligence of the Company at the law
offices of Gunderson, Dettmer, Stough, Villeneuve, Franklin & Hachigian, LLP
("Gunderson, Dettmer") the Company's legal counsel. The due diligence consisted
mainly of the review of publicly available documents.
On May 26, 1999, Mr. Clouser and Mr. Mottet, Bear Stearns, PaineWebber and
TM Capital met in New York. On this occasion, the Company made available to
Parent certain confidential non-public information. Parent performed a limited
due diligence investigation of the Company through discussions
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with Mr. Clouser and the Company's financial advisors about the business and
financial condition of the Company.
On May 28, 1999, PaineWebber contacted Bear Stearns and indicated that the
Company would not consider a possible sale of the Company unless the price was
in excess of $25 per share.
On June 2, 1999, Mr. Mottet informed Mr. Clouser of Parent's willingness to
pursue acquisition negotiations at a price of $25.00 per share. Mr. Clouser
informed Mr. Mottet that the price was below what had been indicated by another
potential bidder. Mr. Clouser and Mr. Mottet discussed having a meeting in New
York on June 9, 1999 but Mr. Clouser asked Mr. Mottet to consider increasing his
price.
On June 3, 1999 Bear, Stearns had conversations with PaineWebber to discuss
the process for beginning negotiations. On June 4, 1999 Mr. Mottet called to
inform Mr. Clouser that the Parent would be willing to pursue negotiations based
on the price of $27.00 per share assuming that the negotiations could proceed
quickly. Mr. Mottet also informed Mr. Clouser that Parent would be willing to
pursue such negotiations only if the Selling Stockholders were willing to
execute an agreement with Parent which gave Parent an option to purchase the
shares owned by the Selling Stockholders. On the same day Bear Stearns contacted
PaineWebber to confirm the $27 per share price and request an exclusive
negotiating period. PaineWebber rejected any negotiating exclusivity. Based on
these conversations, it was agreed that negotiations could start in New York on
June 7, 1999.
On June 5, 1999, Mr. Mottet informed Mr. Clouser that the $27 per share
offer would be rescinded if negotiations were not accelerated.
On June 5, 1999, Mr. Clouser agreed to provide initial comments on the
documents on June 6 and to meet in New York on the evening of June 7, 1999 to
commence negotiations. Later that day counsel for the Parent delivered initial
drafts of the Merger Agreement and the Stockholders' Agreement to counsel for
the Company.
On June 6, 1999 counsel for the companys' provided initial comments in the
documents to counsel for the Parent. On June 7, 1999, counsel for the Company
provided detailed comments on the Merger Agreement draft.
On June 8, 1999, Parent's Board of Directors approved the proposal to
acquire the Company at a purchase price of $27.00 per share and negotiations of
the Merger Agreement and Stockholders' Agreement were initiated. The Company,
its counsel and financial advisors met with Parent, its counsel and financial
advisors to negotiate the Merger Agreement at various times on June 8, 9 and 10.
On June 9 and June 10, 1999, counsel for Parent conducted further due
diligence of the Company at the offices of counsel for the Company.
On June 9, 1999, Mr. Clouser advised Mr. Mottet that the Company had
received a higher bid and requested that the Parent increase its bid. Mr. Mottet
declined to increase the Parent's offer price and sought to accelerate execution
of the Merger Agreement and Stockholders' Agreement. PaineWebber and S G Cowen
Securities Corporation, which had also been retained as a financial advisor to
the Company contacted Bear Stearns to seek an increase in the Parent's offer
price and to terminate any further due diligence of the Company by the Parent.
On June 10, 1999, prior to a special meeting of Company's board of
directors, Mr. Clouser once again contacted Mr. Mottet to seek an increase the
offer price. Once again Mr. Mottet declined.
On June 10, 1999, Bear Stearns and Arthur Andersen performed limited due
diligence on behalf of the Parent, meeting with members of the Company's
management and PaineWebber at the offices of counsel for the Company.
The Company has informed Parent that on June 10, 1999, the Company's Board
of Directors held a special meeting to consider and evaluate Parent's proposed
offer and the Merger Agreement as well as a
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competing offer. The Company's Board of Directors approved Parent's proposal to
acquire the Company at a purchase price of $27.00 per share as well as the
Merger Agreement.
12. PURPOSE OF THE OFFER; THE MERGER AGREEMENT; THE STOCKHOLDERS' AGREEMENT
PURPOSE AND STRUCTURE
The purpose of the Offer is for IBA to acquire the entire equity interest in
the Company not held by IBA or its affiliates. The purpose of the Merger is for
IBA to acquire all of the equity interest in the Company not acquired pursuant
to the Offer. Upon consummation of the Merger, Purchaser, an indirect
wholly-owned subsidiary of IBA, will merge with and into the Company. The
acquisition of equity in the Company has been structured as a cash tender offer
followed by a merger in order to provide a prompt transfer of ownership of the
equity interest in the Company from the Company's public stockholders to IBA and
to provide them with cash for all of their Shares. In the Merger, each
outstanding Share (except for Shares owned by IBA, Purchaser or any subsidiary
of IBA, Purchaser or the Company) will be converted into the right to receive
the Offer Price, net to the holder in cash, without interest.
Under the DGCL, the approval of the Board of the Company and, under certain
circumstances, the affirmative vote of the holders of the majority of the
outstanding Shares is required to approve and adopt the Merger Agreement and the
Merger. If Purchaser acquires a number of shares sufficient to satisfy the
Minimum Condition, Purchaser and Parent together will have sufficient voting
power to approve and adopt the Merger Agreement and the Merger at a
stockholders' meeting without the vote of any other stockholder of the Company.
In the Merger Agreement, the Company has agreed to take all action necessary
to convene a special meeting of its stockholders as promptly as practicable
after the consummation of the Offer for the purpose of considering and taking
action on the Merger Agreement and the transactions contemplated thereby, if
such action is required under the DGCL.
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PLANS FOR THE COMPANY
Except as described in this Offer to Purchase, the Parent and the Purchaser
have no present plan or proposals, that would result in any extraordinary
corporate transaction, such as a merger, reorganization or liquidation or sale
or transfer of a material amount of assets, involving the Company or any of its
subsidiaries or any internal changes in the Company's corporate structure or
business or any change in its present Board of Directors or management.
THE MERGER AGREEMENT
The following description of certain provisions of the Merger Agreement is
presented only as a summary and is qualified in its entirety by reference to the
Merger Agreement, a copy of which is included as an exhibit to the Schedule
14D-1.
THE OFFER. The Merger Agreement provides for the making of the Offer by
Purchaser for the purchase of the Shares. Purchaser's obligation to accept the
Shares tendered to it shall be subject to the satisfaction of certain conditions
(see "THE TENDER OFFER--15. Certain Conditions of the Offer"), as provided in
the Merger Agreement. Purchaser may waive any condition to the Offer, increase
the Merger Price and may make any other changes in the terms and conditions of
the Offer, provided that, unless previously approved by the Company in writing;
Purchaser may not (i) decrease the Offer Price, (ii) change the form of
consideration payable in the Offer, (iii) reduce the number of Shares required
to satisfy the Minimum Condition, (iv) reduce the maximum number of Shares to be
purchased in the Offer, (v) add conditions to the Offer in addition to those set
forth in Article 7 of the Merger Agreement, (vi) otherwise modify or amend those
conditions in a manner that is materially adverse to the holders of the Shares,
or (vii) extend the Expiration Date beyond September 30, 1999 (except to comply
with any rule, regulation or interpretation of the Commission or to satisfy the
conditions to the Offer).
THE BOARD. The Merger Agreement provides that promptly after the close of
the Offer and the purchase of Shares pursuant thereto, Purchaser will be
entitled to designate a majority of the Board of Directors. The Company will,
upon request from Purchaser, use its best efforts either to increase the size of
the Board of Directors (subject to the provisions of the Company's Certificate
of Incorporation) or to secure the resignation of such number of Directors as is
necessary to enable Purchaser's designees to be elected to the Board of
Directors and to use its best efforts to cause such designees to be so elected
and to constitute at all times after the expiration date of the Offer (the
"Tender Offer Purchase Time") a majority of the Board of Directors.
Notwithstanding the foregoing, the Company shall use its reasonable efforts to
encourage James F. Clouser and Fred Reugsegger to remain members of the Board of
Directors until the Effective Time as defined below. The Company shall promptly
take all actions required pursuant to Section 14(f) of the Exchange Act and Rule
14f-1 promulgated thereunder to enable Purchaser's designees to be elected to
the Board of Directors. Purchaser will supply the Company any information with
respect to its nominees, officers, directors and affiliates required by Section
14(f) of the Exchange Act and Rule 14f-1 thereunder.
Following the appointment of the Purchaser's designees to the Board of
Directors and prior to the Effective Time, any amendment or termination of the
Merger Agreement, any extension of the performance or waiver of the obligations
or other acts of Parent, IBA GP or Purchaser, or waiver of the Company's rights
under the Merger Agreement, will require the concurrence of a majority of the
directors who were directors of the Company before the appointment of
Purchaser's designees.
THE MERGER. At the Effective Time and upon the terms and subject to the
conditions of the Merger Agreement and in accordance with the DGCL, Purchaser
shall be merged with and into the Company (the "Merger"). Following the Merger,
the Company shall continue as the surviving corporation (the "Surviving
Corporation") and the separate corporate existence of Purchaser shall cease. The
closing of the Merger will take place at a time (the "Closing Time") and on a
date which shall be no later than the second business day after satisfaction of
all applicable conditions set forth in the Merger Agreement, unless
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another time, date or place is agreed to in writing. Subject to the terms and
conditions set forth in the Merger Agreement, a certificate of merger (the
"Merger Certificate") shall be duly executed and acknowledged by Purchaser and
the Company and thereafter delivered at the Closing Time to the Secretary of
State of the State of Delaware, for filing pursuant to the DGCL. The Merger
shall become effective at such time as a properly executed and certified copy of
the Merger Certificate is duly accepted for record by the Secretary of State of
the State of Delaware for filing pursuant to the DGCL, or such later time as
Purchaser and the Company may agree upon and set forth in the Merger Certificate
(not exceeding 30 days after the Merger Certificate is accepted for filing; the
time the Merger becomes effective being referred to herein as the "Effective
Time"). Among other consequences of the Merger, at the Effective Time all the
properties, rights, privileges, power and franchises of the Company and
Purchaser shall vest in the Surviving Corporation and all debts, liabilities and
duties of the Company and Purchaser shall become the debts, liabilities and
duties of the Surviving Corporation.
The Certificate of Incorporation of the Company in effect at the Effective
Time shall be the Certificate of Incorporation of the Surviving Corporation
until amended in accordance with applicable law. The Bylaws of the Company in
effect at the Effective Time shall be the Bylaws of the Surviving Corporation
until amended in accordance with applicable law. The directors and officers of
Purchaser at the Effective Time shall be the initial directors and officers of
the Surviving Corporation, each to hold office in accordance with the charter
and Bylaws of the Surviving Corporation until the next annual meeting of
stockholders and until each such director's successor is duly elected or
appointed and qualified, each such officer's successor is duly appointed, as
applicable.
At the Effective Time, each Share issued and outstanding immediately prior
to the Effective Time (other than (i) Shares held by any of the Company's
subsidiaries, (ii) Shares held by Parent, IBA GP, Purchaser or any of their
affiliates and (iii) Dissenting Shares (defined herein)) shall, together with
associated Rights by virtue of the Merger, and without any action on the part of
Purchaser, the Company or the holder thereof, be converted into and shall have
the right to receive the Offer Price, without interest (the "Cash Merger
Consideration"). However, if between the date of this Agreement and the
Effective Time, the Shares shall have been changed into a different number of
shares or a different class by reason of any stock dividend, subdivision,
reclassification, recapitalization, split, combination or exchange of shares,
then the Cash Merger Consideration contemplated by the Merger shall be
correspondingly adjusted to reflect such stock dividend, subdivision,
reclassification, recapitalization, split, combination or exchange of shares. At
the Effective Time, each Share, then owned by Parent, IBA GP, Purchaser, the
Company or any direct or indirect wholly-owned subsidiary of Parent, IBA GP,
Purchaser or the Company shall, by virtue of the Merger, be canceled and retired
and will cease to exist and no payment shall be made without respect thereto. At
the Effective Time, each share of common stock of Purchaser issued and
outstanding immediately prior to the Effective Time shall be converted into and
exchanged for one fully-paid and non-assessable share of common stock, par value
$0.001 per share, of the Surviving Corporation.
As of the Effective Time, Purchaser shall deposit with such agent or agents
as may be appointed (the "Payment Agent") for the benefit of the holders of
Shares the amount of cash necessary to pay the Cash Merger Consideration (such
cash is hereinafter referred to as the "Merger Fund") payable in exchange for
outstanding Shares.
At the Effective Time, each outstanding option to purchase Shares (a
"Company Stock Option," or collectively, "Company Stock Options") issued
pursuant to the Company's 1997 Equity Incentive Plan and its Second Amended and
Restated 1986 Stock Option Plan (each a "Company Option Plan" or collectively,
"Company Option Plans") shall vest in full and the Surviving Corporation shall
pay to the holder of each outstanding Company Stock Option an amount equal to
the excess, if any, of the Offer Price over the exercise price per Share of such
Company Stock Option, less the amount of taxes required to be withheld under
U.S. federal, state or local laws and regulations, multiplied by the number of
Shares subject to such Company Stock Option.
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REPRESENTATIONS AND WARRANTIES. The Merger Agreement contains certain
customary representations and warranties of the parties thereto. These include
representations and warranties of the Company with respect to corporate
existence and power, capitalization, subsidiaries, corporate authorization with
respect to the Merger Agreement, reports filed with the Commission, governmental
approvals, financial statements, litigation, Year 2000 compliance, amendment to
the Rights Agreement (as defined hereinafter), applicability of state takeover
statutes and other matters. Purchaser and IBA have also made certain
representations and warranties with respect to corporate existence and power,
corporate authorization with respect to the Merger Agreement, government
consents and approvals, and the availability of funds to finance the Offer and
the Merger.
INTERIM OPERATIONS. The Company has agreed that, from the date of the
Merger Agreement until the Closing Time, unless the Parent has consented thereto
in writing, the Company shall, and shall cause each of its subsidiaries to (a)
conduct its business and operations only in the ordinary course of business
consistent with past practice; (b) use reasonable efforts to preserve intact the
business, organization, goodwill, rights, licenses, permits and franchises of
the Company and its subsidiaries and maintain their existing relationships with
customers, suppliers and other persons having business dealings with them, the
loss of any of which would be reasonably likely to result in a material adverse
effect on the Company; (c) use reasonable efforts to keep in full force and
effect adequate insurance coverage and maintain and keep its properties and
assets in good repair, working order and condition, normal wear and tear
excepted; (d) not amend or modify its respective charter or certificate of
incorporation, by-laws, or other charter or organization documents; (e) not
authorize for issuance, issue, sell, grant, deliver, pledge or encumber or agree
or commit to issue, sell, grant, deliver, pledge or encumber any shares of any
class or series of capital stock of the Company or any of its subsidiaries or
any other equity or voting security or equity or voting interest in the Company
or any of its subsidiaries, any securities convertible into or exercisable or
exchangeable for any such shares, securities or interests, or any options,
warrants, calls, commitments, subscriptions or rights to purchase or acquire any
such shares, securities or interests (other than issuances of Shares upon
exercise of Company Stock Options as then in effect granted to directors,
officers, employees and consultants of the Company prior to the date of the
Merger Agreement); (f) not (i) split, combine or reclassify any shares of its
stock or issue or authorize or propose the issuance of any other securities in
respect of, in lieu of, or in substitution for, shares of its stock, (ii) solely
in the case of the Company, declare, set aside or pay any dividends on, or make
other distributions in respect of, any of the Company's stock, or (iii)
repurchase, redeem or otherwise acquire, or agree or commit to repurchase,
redeem or otherwise acquire, any shares of stock or other equity or debt
securities or equity interests of the Company or any of its subsidiaries; (g)
not amend or otherwise modify the terms of any Company Stock Options or the
Company Option Plans, the effect of which would be to make such terms more
favorable to the holders thereof or persons eligible for participation therein;
(h) other than regularly scheduled seniority increases in the ordinary course of
business consistent with past practice, not increase the compensation payable or
to become payable to any directors, officers or employees of the Company or any
of its subsidiaries, or grant any severance or termination pay to, or enter into
any employment or severance agreement with any director or officer of the
Company or any of its subsidiaries, or establish, adopt, enter into or amend in
any material respect or take action to accelerate any material rights or
benefits under any collective bargaining, bonus, profit sharing, thrift,
compensation, stock option, restricted stock, pension, retirement, deferred
compensation, employment, termination, severance or other plan, agreement,
trust, fund, policy or arrangement for the benefit of any director, officer or
employee or the Company of any of its subsidiaries; (i) not acquire or agree to
acquire (including, without limitation, by merger, consolidation, or acquisition
of stock, equity securities or interests, or assets) any corporation,
partnership, joint venture, association or other business organization or
division thereof or otherwise acquire or agree to acquire any assets of any
other person outside the ordinary course of business consistent with past
practice or any interest in any real properties (whether or not in the ordinary
course of business); (j) not incur, assume or guarantee any indebtedness for
borrowed money (including draw-downs on letters or lines of credit) or issue or
sell any notes, bonds, debentures, debt instruments, evidences of indebtedness
or other debt
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securities of the Company or any of its subsidiaries or any options, warrants or
rights to purchase or acquire any of the same, except for (i) renewals of
existing bonds and letters of credit in the ordinary course of business not to
exceed $1,000,000 in the aggregate and (ii) advances, loans or other
indebtedness in the ordinary course of business consistent with past practice in
an aggregate amount not to exceed $1,000,000; (k) not sell, lease, license,
encumber or otherwise dispose of, or agree to sell, lease, license, encumber or
otherwise dispose of, any material properties or assets of the Company and its
subsidiaries taken as a whole; (l) not authorize or make any capital
expenditures (including by lease) in excess of $1,000,000 in the aggregate for
the Company and all of its subsidiaries; (m) not make any material change in any
of its accounting or financial reporting (including tax accounting and
reporting) methods, principles or practices, except as may be required by U.S.
GAAP or applicable tax laws; (n) not make any material tax election or settle or
compromise any material United States or foreign tax liability; (o) except in
the ordinary course of business consistent with past practice, not amend, modify
or terminate certain specified contracts or waive, release or assign any
material rights or claims thereunder; (p) not adopt a plan of complete or
partial liquidation, dissolution, merger, consolidation, restructuring,
recapitalization or other reorganization of the Company or any of its
subsidiaries; and (q) except as to subsections (a), (b) and (c) above, not agree
or commit in writing or otherwise to do any of the foregoing.
STOCKHOLDERS MEETING. The Company has agreed that, if required for the
Merger under the DGCL, it shall, through its Board of Directors, duly call a
meeting of its stockholders for the purpose of considering and approving the
Merger Agreement, the Merger and all other transactions contemplated therein.
Under the DGCL, if, after consummation of the Offer, Purchaser owns at least 90%
of the Shares then outstanding, Purchaser will be able to cause the Merger to
occur without a vote of the Company's stockholders. If, however, after
consummation of the Offer, Purchaser owns less than 90% of the then outstanding
Shares, a vote of the Company's stockholders will be required under the DGCL to
approve the Merger. Assuming no additional Shares (or warrants, options or
rights exercisable for, or securities convertible into, Shares) have been issued
(other than Shares issued pursuant to such options and rights referred to
above), if Purchaser were to acquire 3,842,707 pursuant to the Offer (including
the Shares that, pursuant to the Stockholders' Agreement are required to be
tendered in response to the Offer), the Minimum Condition would be satisfied and
the Purchaser and Parent would together own a majority of the Shares outstanding
on a diluted basis and would have the votes required to effect the Merger
without the vote of any other stockholders following the Tender Offer Purchase
Time, the Company will mail to its stockholders an information proxy conforming
to the requirements of Schedule 14A under the Exchange Act, regarding a special
meeting of the Company's stockholders to be held to consider approval of the
Merger. As a result of certain timing requirements under federal and Delaware
law, the special meeting of the stockholders would not take place until a number
of weeks following the Tender Offer Purchase Time.
OTHER POTENTIAL ACQUIRERS. Pursuant to the Merger Agreement, the Company
has agreed that from and after the date of the Merger Agreement until the
earlier of the Effective Time or termination of the Merger Agreement in
accordance with its terms, the Company and its subsidiaries shall not, and will
instruct their respective directors, officers, employees, representatives,
investment bankers, agents and affiliates not to, directly or indirectly,
solicit or encourage submission of, any inquiries, proposals or offers by any
person, entity or group (other than IBA and its affiliates, agents and
representatives), or participate in any discussions or negotiations with, or
disclose any non-public information concerning the Company to, any person,
entity or group (other than IBA and its affiliates, agents and representatives),
in connection with any "Acquisition Proposal" with respect to the Company. For
purposes of the Merger Agreement, an "Acquisition Proposal" with respect to an
entity means any proposal or offer relating to (i) any merger, consolidation,
sale of substantial assets or similar transactions involving the entity or any
subsidiaries of the entity (other than sales of assets or inventory in the
ordinary course of business or as permitted under the terms of the Merger
Agreement); (ii) the acquisition by any person of beneficial ownership or a
right to acquire beneficial ownership of, or the formation of any "group" (as
defined under Section 13(d) of the Exchange Act and the rules and regulations
thereunder) which beneficially owns, or has the right to acquire beneficial
ownership of, 10% or more of the then outstanding shares of capital stock of the
entity
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(except for acquisititions for passive investment purposes only in circumstances
where the person or group qualifies for and files a Scheduled 13G with respect
thereto); (iii) the adoption by the entity of a plan of liquidation or the
declaration or payment of an extraordinary dividend; (iv) the repurchase by the
entity of more than 20% of its outstanding shares of voting stock; (v) the
acquisition by the entity of direct or indirect ownership of a business whose
annual revenue, net income or assets is greater than 20% of the entity; or (vi)
any public announcement of a proposal, plan or intention to do any of the
foregoing or any agreement to engage in any of the foregoing. The Company has
agreed to notify IBA as promptly as practicable if any inquiry or proposal is
made or any information or access is requested in connection with an Acquisition
Proposal or potential Acquisition Proposal and as promptly as practicable notify
IBA of the terms and conditions of any such Acquisition Proposal. In addition,
subject to certain other provisions of the Merger Agreement, from and after the
date of the Merger Agreement until the earlier of the Effective Time and
termination of the Merger Agreement its terms, the Company and its subsidiaries
will not, and will instruct their respective directors, officers, employees,
representatives, investment bankers, agents and affiliates not to directly or
indirectly, make or authorize any public statement, recommendation or
solicitation in support of any Acquisition Proposal made by any person, entity
or group (other than Parent or Purchaser); PROVIDED, HOWEVER, that nothing in
the Merger Agreement shall prohibit the Company's Board of Directors from taking
and disclosing to the Company's stockholders a position with respect to a tender
offer pursuant to Rules 14d-9 and 14e-2 promulgated under the Exchange Act.
Except as allowed under this paragraph, the Company's Board of Directors will
not withdraw or modify in a manner adverse to Parent or Purchaser its
recommendation of the transactions contemplated hereby or approve or recommend
any Acquisition Proposal. Notwithstanding the provisions above, prior to
consummation of the Offer, the Company may, to the extent the Board of Directors
of the Company determines, in good faith, after consultation with outside legal
counsel, that the Board of Directors' fiduciary duties under applicable law
require it to do so, participate in discussions or negotiations with, and
furnish information to, any person, entity or group after such person, entity or
group has delivered to the Company in writing, an unsolicited bona fide
Acquisition Proposal which the Board of Directors of the Company in its good
faith reasonable judgment determines, after consultation with its independent
financial advisors, would result in a transaction more favorable than the Offer
and the Merger to the stockholders of the Company from a financial point of view
and for which financing, to the extent required, is then committed or which, in
the good faith reasonable judgment of the Board of Directors of the Company
(based upon the advice of independent financial advisors) is reasonably capable
of being financed by such person, entity or group and which is likely to be
consummated (a "Superior Proposal"). Notwithstanding anything to the contrary in
the Merger Agreement, the Company will not provide any non-public information to
a third party unless: (x) the Company provides such non-public information
pursuant to a non-disclosure agreement with terms regarding the protection of
confidential information at least as restrictive as such terms in the
confidentiality agreement with Purchaser and Parent; and (y) such non-public
information has been previously delivered to Parent.
In the event the Company receives a Superior Proposal, nothing contained in
the Merger Agreement prevents the Board of Directors of the Company from
recommending such Superior Proposal to the Company's stockholders, if the Board
of Directors determines, in good faith, after consultation with outside legal
counsel, that such action is required by its fiduciary duties under applicable
law, provided, however, that the Company shall not recommend to its stockholders
a Superior Proposal for a period of not less than 72 hours after Parent's
receipt of a copy of such Superior Proposal (or a description of terms and
conditions thereof, if not in writing).
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The Company shall pay to Parent an amount equal to $7,500,000 (the "Break-Up
Fee") if any of the following shall occur: (i) the Board of Directors of the
Company or any committee thereof shall have approved, or recommended that
stockholders of the Company accept or approve, an Acquisition Proposal by a
third party; (ii) the Board of Directors of the Company or any committee thereof
shall have withdrawn or modified its approval of, or recommendation that the
stockholders of the Company accept or approve (as the case may be), the Offer,
the Merger Agreement and the Merger; or (iii) the Company shall have failed to
include in its Schedule 14D-9 the recommendation of the Board of Directors of
the Company that the stockholders of the Company accept the Offer. Such Break-Up
Fee shall be payable within thirty (30) days of such event.
DISSENTING SHARES. In the event that dissenters' rights are available in
connection with the Merger pursuant to Section 262 of the DGCL, Shares that are
issued and outstanding immediately prior to the Effective Time and that are held
by stockholders who did not vote in favor of the Merger and who comply with all
of the relevant provisions of Section 262 of the DGCL (the "Dissenting Shares")
shall not be converted into or be exchangeable for the right to receive the Cash
Merger Consideration, but instead shall be converted into the right to receive
such consideration as may be determined to be due to such stockholders pursuant
to Section 262 of the DGCL, unless such holders shall have failed to perfect or
shall have effectively withdrawn or lost their rights to appraisal under the
DGCL. If any such holder shall have failed to perfect or shall have effectively
withdrawn or lost such right, such holder's Shares shall thereupon be deemed to
have been converted into and to have become exchangeable for the right to
receive, as of the Effective Time, the Cash Merger Consideration without any
interest thereon. The Company has agreed to give Parent prompt notice of any
written demands for appraisal of Shares received by the Company and the
opportunity to participate in all negotiations and proceedings with respect to
any such demands.
THE FOREGOING SUMMARY OF THE RIGHTS OF DISSENTING STOCKHOLDERS DOES NOT
PURPORT TO BE A COMPLETE STATEMENT OF THE PROCEDURES TO BE FOLLOWED BY
STOCKHOLDERS DESIRING TO EXERCISE ANY AVAILABLE DISSENTERS' RIGHTS AND IS
QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE FULL TEXT OF SECTION 262 OF THE
DGCL, INCLUDED HEREWITH IN ANNEX A. THE PRESERVATION AND EXERCISE OF APPRAISAL
RIGHTS ARE CONDITIONED ON STRICT ADHERENCE TO THE APPLICABLE PROVISIONS OF THE
DGCL.
CONDITIONS TO THE MERGER. The respective obligations of the Company, IBA
and Purchaser to effect the Merger are subject to the satisfaction at or prior
to the Closing Time of the following conditions: (a) the Merger Agreement, the
Merger and the other transactions contemplated thereby shall have been approved
by all necessary corporate action of the Company, including, if necessary,
adoption by vote of the stockholders of the Company; (b) no governmental entity
or court of competent jurisdiction shall have enacted, issued, promulgated,
enforced or entered any statute, rule, regulation, executive order, decree,
injunction or other order (and if temporary or preliminary, not vacated within
five business days of its entry) which is in effect and which (1) makes the
payment of the Cash Merger Consideration illegal or otherwise prohibits or
restricts consummation of the Merger or any of the other applicable transactions
contemplated thereby, or (2) imposes material limitations on the ability of
Parent, IBA GP or Purchaser to acquire or hold or to exercise any rights of
ownership of the Surviving Corporation, or effectively manage or control the
Surviving Corporation and its business, assets and properties; (c) any waiting
period applicable to the Merger under the HSR Act shall have terminated or
expired and any other governmental or regulatory notices or approvals required
with respect to the transactions contemplated hereby shall have been either
filed or received; and (d) Purchaser shall have purchased Shares pursuant to the
Offer.
TERMINATION. The Merger Agreement may be terminated, at any time prior to
the Effective Time, whether before or after approval by the stockholders of the
Company: (a) by mutual written agreement of the Boards of Directors of IBA and
the Company; (b) by either IBA or the Company: (i) if the Offer shall be
terminated or expire without any Shares having been purchased pursuant to the
Offer; provided,
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however, that a party shall not be entitled to terminate the Merger Agreement
pursuant to this provision if it is in material breach of its representations
and warranties, covenants or other obligations under the Merger Agreement; and
provided, further, however, that if the Offer is not consummated due to a
failure to obtain clearance under the HSR Act, Parent may not terminate the
Merger Agreement until December 31, 1999 and the Company may not terminate the
Merger Agreement until April 1, 2000; (ii) if any court of competent
jurisdiction in the United States or other United States governmental body shall
have issued an order, decree or ruling or taken any other action restraining,
enjoining or otherwise prohibiting the Offer or the Merger and such order,
decree, ruling or other action shall have become final and non-appealable; (c)
by Parent: (i) if the Board of Directors of the Company or any committee thereof
shall have approved, or recommended that stockholders of the Company accept or
approve, an Acquisition Proposal by a third party, or shall have resolved to do
any of the foregoing; (ii) if the Board of Directors of the Company or any
committee thereof shall have withdrawn or modified its approval of, or
recommendation that the stockholders of the Company accept or approve (as the
case may be), the Offer, the Merger Agreement and the Merger, or shall have
resolved to do any of the foregoing; (iii) if the Company shall have failed to
include in the Schedule 14D-9 the recommendation of the Board of Directors that
the stockholders of the Company accept the Offer; (iv) prior to the purchase of
the Shares pursuant to the Offer, if the Company is in material breach of any of
its covenants or obligations under the Merger Agreement, or any representation
or warranty of the Company contained in the Merger Agreement shall have been
incorrect, in any material respect, when made; (v) prior to the purchase of
Shares pursuant to the Offer, in the event that the conditions to the Offer
shall not be satisfied, provided that Parent may not terminate the Merger
Agreement due to a failure to obtain clearance under the HSR Act until December
31, 1999; or (vi) after purchase of the Shares pursuant to the Offer, if the
Company is in violation or breach of Section 1.3 of the Merger Agreement; (d) by
the Company: (i) if the Offer shall not have been commenced in accordance with
the Merger Agreement, or Parent or Purchaser shall have failed to purchase
validly tendered Shares in violation of the terms of the Offer within ten (10)
business days after the expiration of the Offer; provided, however, that the
Company shall not terminate the Merger Agreement if it is in material breach of
its representations and warranties, covenants, or other obligations under the
Merger Agreement; (ii) if the Board of Directors of the Company has resolved to,
and in fact does, recommend to the Company's stockholders that they accept a
Superior Proposal, provided all provisions of the Merger Agreement have been
complied with and the Break-Up Fees have been paid to Parent; (iii) prior to the
purchase of Shares pursuant to the Offer, if Parent or Purchaser is in material
breach of any of its covenants or obligations under the Merger Agreement, or any
representation or warranty of Parent or Purchaser contained in the Merger
Agreement in any material respect, when made; or (iv) at any time after March
31, 2000 if the Offer has not been consummated due to a failure to obtain
clearance under the HSR Act; provided, however, that the Company shall not be
entitled to terminate the Merger Agreement if it is in material breach of its
representations and warranties, covenants and other obligations under the Merger
Agreement.
AMENDMENT OF THE MERGER AGREEMENT. The Merger Agreement may be amended by
the Company, Purchaser, IBA and IBA GP by action taken by or on behalf of their
respective Boards of Directors at any time prior to the Effective Time;
PROVIDED, HOWEVER, that (i) any such amendment shall be in writing signed by all
of the parties, (ii) any such waiver, amendment or supplement by the Company
shall be effective as against the Company only if approved by a majority of
those directors of the Company then in office who were directors of the Company
as of June 10, 1999, or are directors (other than directors designated by
Purchaser in accordance with the Merger Agreement) designated by such persons to
fill any vacancy, and (iii) after adoption of the Merger Agreement and the
Merger by the stockholders of the Company, no amendment that reduces the Merger
Consideration or changes the form thereof or changes any other terms and
conditions of the Merger Agreement can be made without the further approval of
the stockholders of the Company if the changes, alone or in the aggregate, would
materially adversely affect the stockholders of the Company.
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THE STOCKHOLDERS' AGREEMENT
On June 10, 1999, the Stockholders' Agreement was executed by and among
Parent, IBA GP, Purchaser and the Selling Stockholders. The following summary of
the material terms of the Stockholders' Agreement is qualified in its entirety
by reference to the copy of the Stockholders' Agreement filed as an Exhibit to
the Schedule 14D-1.
VOTING OF SHARES. Each Selling Stockholder agrees that during the period
commencing as of the date of the Stockholders' Agreement, and continuing until
the Closing Time or 45 days after the termination of the Merger Agreement in
accordance with its terms, whichever first occurs, each Selling Stockholder
shall vote (or cause to be voted) the Shares held of record or beneficially
owned by each Selling Stockholder at any meeting of the holders of the Shares,
whether owned on June 10, 1999, or thereafter, (i) in favor of approval of the
Merger Agreement, all transactions contemplated thereby and any actions required
in furtherance of the Merger Agreement or the Stockholders' Agreement (including
election of such directors of the Company as Parent is entitled to designate
pursuant to the Merger Agreement); (ii) against any action or agreement that is
intended, or could reasonably be expected, to impede, interfere with, or prevent
the Offer or the Merger or result in a breach in any respect of any covenant,
representation or warranty or any other obligation or agreement of the Company
or any of its subsidiaries under the Merger Agreement or the Stockholders'
Agreement; and (iii) except as specifically requested in writing in advance by
IBA, against the following actions (other than the Merger and the transactions
contemplated by the Merger Agreement and the Stockholders' Agreement): (A) any
extraordinary corporate transaction, such as a merger, consolidation or other
business combination involving the Company or any of its subsidiaries or
affiliates; (B) a sale, lease, transfer or disposition by the Company or any of
its subsidiaries of any assets outside the ordinary course of business or any
assets which in the aggregate are material to the Company and its subsidiaries
taken as a whole, or a reorganization, recapitalization, dissolution or
liquidation of the Company or any of its subsidiaries or affiliates; (C) (i) any
change in the present capitalization of the Company or any amendment of the
Company's charter or Bylaws; (ii) any other material change in the Company's or
any of its subsidiaries' corporate structure or business; or (iii) any other
action that, in the case of each of the matters referred to in clauses (C) (i),
(ii) or (iii), is intended, or could reasonably be expected, to impede,
interfere with, delay, postpone or materially adversely affect the Offer, the
Merger or the transactions contemplated by the Stockholders' Agreement or the
Merger Agreement. None of the Selling Stockholders shall enter into any
agreement or understanding with any person the effect of which would be
inconsistent with or violative of the provisions and agreements contained in the
Stockholders' Agreement.
IRREVOCABLE PROXY. Effective from June 10, 1999, each Selling Stockholder
has agreed to appoint certain officers of Parent, and their respective
successors and designees, as true, lawful and irrevocable (until the Closing
Time or 45 days after the termination of the Merger Agreement, whichever is
earlier) proxies and attorneys-in-fact (with full power of substitution) to vote
their Shares, or to grant a consent or approval in respect of such Shares. Each
Selling Stockholder granted to Parent and its respective successors and
designees an irrevocable proxy coupled with an interest.
OTHER COVENANTS, REPRESENTATIONS AND WARRANTIES. The Stockholders'
Agreement contains certain customary representations and warranties of the
parties thereto, including, without limitation, representations and warranties
by the Selling Stockholders as to ownership of their Shares, power and
authority.
TENDER OF SHARES, RESTRICTIONS ON TRANSFER, PROXIES AND
NON-INTERFERENCE. Each Selling Stockholder shall tender his or its Shares in
the Offer and shall not withdraw any Shares therefrom unless and until the
Merger Agreement is terminated in accordance with its terms without such Shares
being purchased by Purchaser pursuant to the Offer. Each of the Selling
Stockholders has agreed not, directly or indirectly, to: (i) tender his or its
Shares in any other tender offer or exchange offer for the Shares; (ii) except
as contemplated by the Stockholders' Agreement or the Merger Agreement,
otherwise offer for sale, sell, transfer, tender, pledge, encumber, assign or
otherwise dispose of, or enter into any contract, option or
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other arrangement or understanding with respect to any interest therein; (iii)
grant any proxies or powers of attorney, deposit any Shares into a voting trust
or enter into a voting agreement with respect to any Shares; or (iv) take any
action that would make any representation or warranty of any such Selling
Stockholder contained herein untrue or incorrect or have the effect of
preventing or disabling such Selling Stockholder from performing such Selling
Stockholder's obligations under the Stockholders' Agreement.
OTHER POTENTIAL ACQUIRERS. Pursuant to the Stockholders' Agreement, each
Selling Stockholder shall (i) cease existing discussions or negotiations, if
any, with any parties conducted on or before June 10, 1999, with respect to any
acquisition of all or any material portion of the assets of, or any equity
interest in, the Company or any of its subsidiaries or any business combination
with the Company or any of its subsidiaries, in his or her capacity as a
stockholder of the Company; and (ii) from and after June 10, 1999, until the
termination of the Merger Agreement, not, in such capacity, directly or
indirectly, initiate, solicit or knowingly encourage (including by way of
furnishing non-public information or assistance), or take any other action to
facilitate knowingly, any inquiries or the making of any proposal that
constitutes, or may reasonably be expected to lead to, any such transaction or
acquisition, or agree to endorse any such transaction or acquisition, or
authorize or permit any of the Selling Stockholders' agents to do so, and each
Selling Stockholder shall promptly notify Parent of any proposal and shall
provide a copy of such written proposal and a summary of any oral proposal to
Parent immediately after receipt thereof (and shall specify the material terms
and conditions of such proposal and identify the person making such proposal)
and thereafter keep Parent advised of any development with respect thereto.
OPTION. Pursuant to the Stockholders' Agreement, each Selling Stockholder
has granted to Parent an irrevocable option (the "Option") to purchase all
Shares held of record or beneficially owned by such Selling Stockholder at the
Offer Price or such higher price as may be offered by Purchaser in the Offer
(the "Option Price"), and Parent may exercise the Option, in whole or in part,
at any time and from time to time, following the occurrence of a Purchase Event
(as defined below); provided that any part thereof not exercised shall expire
upon the earliest to occur of (i) the Closing Time, (ii) 45 days after a
Purchase Event; or (iii) 45 days after the termination of the Merger Agreement;
provided that the expiration date shall not extend beyond March 31, 2000.
"Purchase Event" means any of the following events: (i) when any person or group
other than IBA, Purchaser or an affiliate thereof acquires the beneficial
ownership of more than 20% of the outstanding capital stock of the Company, or
right to acquire such capital stock of the Company; (ii) when the Company has
entered into agreement or approved or recommended any proposal which provides
for the acquisition of 20% or more of the outstanding capital stock of the
Company or substantially all of the assets of the Company by any person or group
other than IBA, Purchaser or an affiliate thereof; (iii) (A) the failure of the
Company's stockholders to approve the Merger Agreement or the transactions
contemplated thereby at a meeting called to consider such Merger Agreement, if
such meeting shall have been preceded by (x) the public announcement by any
Person or group (other than Parent, Acquisition or an affiliate of any of them)
of an offer or proposal to acquire, merge or consolidate with the Company, or
(y) the Board of Directors of the Company's publicly withdrawing or modifying,
or publicly announcing its intent to withdraw or modify, its recommendation that
the stockholders of the Company approve the transactions contemplated by the
Merger Agreement or (B) the acceptance by the Company's Board of Directors of,
or the public recommendation by the Company's Board of Directors that the
stockholders of the Company accept, an offer or proposal from any Person or
group (other than Parent, Acquisition or an affiliate of any of them), to
acquire 20% or more of the outstanding capital stock of the Company or for a
merger or consolidation or any similar transaction involving the Company; (iv)
the making of an Acquisition Proposal as described in Section 5.3 of the Merger
entitling IBA or the Company to terminate the Merger Agreement pursuant to
Section 9.1 of the Merger Agreement; or (v) any breach by the Selling
Stockholders of the Stockholders' Agreement.
TERMINATION. Except as otherwise provided therein, the Stockholders'
Agreement shall terminate upon the earlier of (A) termination of the Merger
Agreement in accordance with its terms, or (B) the Effective Time.
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13. DIVIDENDS AND DISTRIBUTIONS
If on or after the date of the Merger Agreement the Company should declare
with respect to the Shares, any stock splits or stock dividends or engage in any
combinations, recapitalization or the like, then, without prejudice to
Purchaser's rights under Section 15 of this Offer to Purchase, the purchase
price per Share payable by Purchaser shall be adjusted accordingly.
14. EFFECTS OF THE OFFER ON THE MARKET FOR SHARES; NASDAQ NATIONAL MARKET AND
EXCHANGE ACT REGISTRATION
The purchase of Shares by Purchaser pursuant to the Offer will reduce the
number of Shares that might otherwise trade publicly and the number of holders
of Shares and could thereby adversely affect the liquidity and market value of
the remaining publicly held Shares.
NASDAQ NATIONAL MARKET INCLUSION
According to the Nasdaq National Market's current published guidelines, the
Shares would not be eligible to be included for continued listing if, among
other things, the number of publicly held Shares falls below 750,000, the number
of holders of Shares falls below 400, the aggregate market value of such
publicly held Shares falls below $5,000,000, or the net tangible assets of the
Company fall below $4,000,000. If these standards are not met, the Shares would
no longer be admitted to quotation on the Nasdaq National Market. Depending on
the number of Shares acquired pursuant to the Offer, price quotations for the
Shares may no longer meet the requirements for any continued trading
over-the-counter, including the Nasdaq "additional list" or a "local list." If,
as a result of the purchase of Shares pursuant to the Offer or otherwise,
trading of the Shares over-the-counter is discontinued, the liquidity of and
market for the Shares could be adversely affected. Any reduction in the number
of Shares that might otherwise trade publicly may have an adverse effect on the
market price for or marketability of the Shares and may cause future prices to
be less than the Offer Price.
MARGIN REGULATIONS
The Shares are currently "margin securities" under the regulations of the
Board of Governors of the Federal Reserve System, which has the effect, among
other things, of allowing brokers to extend credit on the collateral of such
Shares for the purpose of buying, carrying or trading in securities ("Purpose
Loans"). Depending upon factors similar to those described above regarding the
continued listing, public trading and market quotations of the Shares, it is
possible that, following the purchase of the Shares pursuant to the Offer, the
Shares would no longer constitute "margin securities" for the purposes of the
margin regulations of the Federal Reserve Board and therefore could no longer be
used as collateral for Purpose Loans made by brokers.
15. CERTAIN CONDITIONS OF THE OFFER
Consummation of the Offer is conditioned upon satisfaction of the Minimum
Condition. Furthermore, Purchaser shall not be required to accept for payment
or, subject to any applicable rules and regulations of the Commission, including
Rule 14e-l(c) under the Exchange Act relating to Purchaser's obligation to pay
for or return tendered Shares promptly after termination or withdrawal of the
Offer, pay for, and may delay the acceptance for payment of, or subject to the
restrictions referred to above, the payment for, any tendered Shares, and may
amend the Offer consistent with the terms of the Merger Agreement, including
extending the deadline for tendering Shares, or terminate the Offer, if any of
the following events shall occur:
(A) from the date of the Merger Agreement until the Tender Offer
Purchase Time, there shall have occurred any change, event, occurrence or
circumstance which, individually or in the aggregate, has a Material Change
(as such term is defined in the Merger Agreement) on the Company;
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(B) from the date of the Merger Agreement until the Tender Offer
Purchase Time, any governmental entity or court of competent jurisdiction
shall have enacted, issued, promulgated, enforced or entered any statute,
rule, regulation, executive order, decree, injunction or other order (and if
temporary or preliminary, not vacated within five (5) business days of its
entry), except with regard to HSR Act approval which is in effect at the
Tender Offer Purchase Time and which (1) makes the acceptance for payment
of, or the payment for, some or all of the Shares illegal or otherwise
prohibits or restricts consummation of the Offer, the Merger or any of the
other transactions contemplated thereby, (2) imposes material limitations on
the ability of Parent, IBA GP or Purchaser to acquire or hold or to exercise
any rights of ownership of the Shares, or effectively to manage or control
the Company and its business, assets and properties or (3) would result in a
Material Change to the Company; PROVIDED, HOWEVER, that the parties shall
use reasonable efforts to cause any such decree, judgment or other order to
be vacated or lifted as soon as practicable;
(C) the representations and warranties of the Company set forth in the
Merger Agreement shall not (i) have been true and correct in one or more
material respects on the date hereof or (ii) except for certain
representation and warranties designated in Section 7.1 of the Merger
Agreement, be true and correct in one or more material respects as of the
scheduled Expiration Date (as such date may be extended) of the Offer as
though made on or as of such date or the Company shall have breached or
failed in any respect to perform or comply with any material obligation,
agreement or covenant required by the Merger Agreement to be performed or
complied with by it except, in each case with respect to clause (ii), (1)
for changes specifically permitted by the Merger Agreement and (2) (x) for
those representations and warranties that address matters only as of a
particular date which are true and correct as of such date or (y) where the
failure of representations and warranties (without regard to materiality
qualifications therein contained) to be true and correct, or the performance
or compliance with such obligations, agreements or covenants, would not,
individually or in the aggregate result in a Material Change to the Company;
(D) from the date of the Merger Agreement until the Tender Offer
Purchase Time, the Merger Agreement shall have been terminated in accordance
with its terms;
(E) from the date of the Merger Agreement until the Tender Offer
Purchase Time, the Board of Directors of the Company or any committee
thereof shall have (1) withdrawn or modified (including without limitation,
by amendment of the Company's Schedule 14D-9) in a manner adverse to Parent
or Purchaser its approval or recommendation of the Offer, the Merger or the
Agreement, (2) approved or recommended any Acquisition Proposal by a third
party other than the Offer and the Merger, (3) resolved to do any of the
foregoing, or (4) upon a request to reaffirm the Company's approval or
recommendation of the Offer, the Merger Agreement or the Merger, the Board
of Directors of the Company shall fail to do so within two business days
after such request is made;
(F) from the date of the Merger Agreement until the Tender Offer
Purchase Time, any of the consents, approvals, authorizations, orders or
permits required to be obtained by the Company, Parent, IBA GP or Purchaser,
or their respective subsidiaries in connection with the Offer or the Merger
from, or filings or registrations required to be made by any of the same
prior to the Tender Offer Purchase Time with, any governmental entity in
connection with the execution, delivery and performance of the Merger
Agreement (including without limitation the termination or expiration of any
applicable waiting period or the receipt of any required clearance under the
HSR Act) shall not have been obtained or made or shall have been obtained or
made subject to conditions or requirements, which (A) make the acceptance
for payment of, or the payment for the Shares illegal or otherwise prohibits
or restricts the consummation of the Offer or the Merger or (B) have a
Parent Material Adverse Effect (as defined in the Merger Agreement) or
result in a Material Change to the Company or (C) impose material
limitations on the ability of Parent, IBA GP or Purchaser effectively to
manage or control the Company; or
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(G) from the date of the Merger Agreement until the Tender Offer
Purchase Time, in the case of HSR Act approval, any governmental entity or
court of competent jurisdiction shall have entered a final non-appealable
order enjoining consummation of the Merger.
(H) from the date of the Merger Agreement until the Tender Offer
Purchase Time, there shall have occurred (1) the declaration of a banking
moratorium or any suspension of payments in respect of banks in the United
States or in Belgium or (2) the commencement of a war or armed hostilities
involving the United States or Belgium and resulting in a Material Change to
the Company or materially adversely affecting (or materially delaying) the
consummation of the Offer
The foregoing conditions (the "Offer Conditions") are for the sole benefit
of Purchaser and may be waived by Purchaser, in whole or in part at any time and
from time to time in the sole discretion of Purchaser. The failure by Purchaser
at any time to exercise any of the foregoing rights shall not be deemed a waiver
of any such right and each such right shall be deemed an ongoing right which may
be asserted at any time and from time to time.
16. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS
GENERAL
Except as described below, Parent is not aware of any license or regulatory
permit that appears to be material to the business of the Company and its
subsidiaries, taken as a whole, that might be adversely affected by the
acquisition of Shares pursuant to the Offer, or of any approval or other action
by any governmental, administrative or regulatory agency or authority or public
body, domestic or foreign, that would be required for the acquisition or
ownership of Shares pursuant to the Offer. Should any such approval or other
action be required, it is presently contemplated that such approval or action
would be sought except as described below in this Section under "State Takeover
Statutes." While, except as otherwise expressly described herein, Parent does
not currently intend to delay acceptance for payment of Shares tendered pursuant
to the Offer pending the outcome of any such matter, there can be no assurance
that any such approval or other action, if needed, would be obtained without
substantial conditions or that adverse consequences might not result to the
Company's business or that certain parts of the Company's business might not
have to be disposed of in the event that such approvals were not obtained or
such other actions were not taken or in order to obtain any such approval or
other action, any of which could cause Parent to decline to accept for payment
or pay for any Shares tendered. Parent's obligation under the Offer to accept
for payment and pay for shares is subject to the Certain Conditions, including
conditions relating to legal matters discussed in this Section 16.
ANTITRUST
Under the HSR Act and the rules that have been promulgated thereunder by the
Federal Trade Commission ("FTC"), certain acquisition transactions may not be
consummated unless certain information has been furnished to the Antitrust
Division of the Department of Justice (the "Antitrust Division") and the FTC and
certain waiting period requirements have been satisfied. The acquisition of
Shares pursuant to the Offer is subject to such requirements.
IBA expects to file a Notification and Report Form with respect to the Offer
under the HSR Act as soon as practicable following commencement of the Offer.
The waiting period under the HSR Act with respect to the Offer will expire at
11:59 p.m. New York City time, on the 15th day after the date such form is
filed, unless early termination of the waiting period is granted. In addition,
the Antitrust Division or the FTC may extend such waiting periods by requesting
additional information or documentary material from IBA. If such a request is
made with respect to the Offer, the waiting period related to the Offer will
expire at 11:59 p.m. New York City time on the 10th day after substantial
compliance by Parent with such request. With respect to each acquisition, the
Antitrust Division or the FTC may issue only one request for additional
information. In practice, complying with a request for additional information or
material can
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take a significant amount of time. In addition, if the Antitrust Division or the
FTC raises substantive issues in connection with a proposed transaction, the
parties may engage in negotiations with the relevant governmental agency
concerning possible means of addressing those issues and may agree to delay
consummation of the transaction while such negotiations continue. Expiration or
termination of applicable waiting periods under the HSR Act is a condition to
the obligation to accept for payment and pay for Shares tendered pursuant to the
Offer.
The Antitrust Division and the FTC frequently scrutinize the legality under
the antitrust laws of transactions such as the proposed purchase of the Shares
pursuant to the Offer. At any time before or after such purchase, the Antitrust
Division or the FTC could take such action under the antitrust laws as it deems
necessary or desirable in the public interest, including seeking to enjoin the
transaction or seeking divestiture of the Shares so acquired or divestiture of
substantial assets of Parent or the Company. Litigation seeking similar relief
could be brought by private parties.
Parent does not believe that consummation of the Offer and the other
transactions contemplated by the Merger Agreement will result in violation of
any applicable antitrust laws. However, there can be no assurance that a
challenge to the Offer and the other transactions contemplated by the Merger
Agreement on antitrust grounds will not be made, or if such a challenge is made,
what the result will be. See "THE TENDER OFFER--15. Certain Conditions Of The
Offer" for certain conditions to the purchase of the Shares, including
conditions with respect to litigation and certain governmental actions.
OTHER REGULATORY CONSENTS
The Company's gamma radiation facilities are subject to regulation and
licensing by the Nuclear Regulatory Commission (the "NRC"). In connection with a
change in control of the Company, the approval of the NRC must be obtained.
Parent is not aware of any reason that the approval of the NRC will not be
obtained on a timely basis. The Company must also obtain the consents of certain
regulatory authorities in connection with the change in control of the Company.
STATE TAKEOVER STATUTES
The Company is incorporated under the laws of the State of Delaware. A
number of states throughout the United States have enacted takeover statutes
that purport, in varying degrees, to be applicable to attempts to acquire
securities of corporations that are incorporated or have assets, stockholders,
executive offices or places of business in such states. In EDGAR V. MITE
CORPORATION, the Supreme Court of the United States invalidated on
constitutional grounds the Illinois Business Takeover Act, which, as a matter of
state securities law, made takeovers of corporations meeting certain
requirements more difficult. However, in CTS CORP. V. DYNAMICS CORP. OF AMERICA,
the Supreme Court held that a state may, as a matter of corporate law and, in
particular, those laws concerning corporate governance, constitutionally
disqualify a potential acquirer from voting on the affairs of a target
corporation without prior approval of the remaining stockholders, provided that
such laws were applicable only under certain conditions, in particular, that the
corporation has a substantial number of stockholders in the state and is
incorporated there.
SECTION 203 OF THE DGCL
Section 203 of the DGCL, in general, prohibits a Delaware corporation such
as the Company from engaging in a "Business Combination" (defined as a variety
of transactions, including mergers, as set forth below) with an "Interested
Stockholder" (defined generally as a person that is the beneficial owner of 15%
or more of a corporation's outstanding voting stock) for a period of three years
following the date that such person became an Interested Stockholder unless,
among other things, prior to the time such person became an Interested
Stockholder, the board of directors of the corporation approved either the
Business Combination or the transaction that resulted in the stockholder
becoming an Interested Stockholder. The Company's Board of Directors has
approved the Merger Agreement, the Stockholders' Agreement and
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Purchaser's acquisition of Shares pursuant to the Offer and the Stockholders'
Agreement. Therefore, Section 203 of the DGCL is inapplicable to the Offer, the
Merger and the Stockholders' Agreement. Based on information supplied by the
Company, the Purchaser does not believe that any other state takeover statutes
purport to apply to the Offer or the Merger or the Stockholders' Agreement.
Neither Purchaser nor Parent has currently complied with any state takeover
statute or regulation. Purchaser reserves the right to challenge the
applicability or validity of any state law purportedly applicable to the Offer
or the Merger and nothing in this Offer to Purchase or any action taken in
connection with the Offer or the Merger is intended as a waiver of such right.
If it is asserted that any state takeover statute is applicable to the Offer or
the Merger and an appropriate court does not determine that it is inapplicable
or invalid as applied to the Offer or the Merger, Purchaser might be required to
file certain information with, or to receive approvals from, the relevant state
authorities, and the Purchaser might be unable to accept for payment or pay for
Shares tendered pursuant to the Offer, or be delayed in consummating the Offer
or the Merger. In such case, Purchaser may not be obligated to accept payment or
pay for any Shares tendered pursuant to the Offer. See "THE TENDER OFFER--2.
Procedure For Accepting The Offer And Tendering Shares."
SHAREHOLDERS RIGHTS PLAN
The Company adopted a shareholder rights plan pursuant to a rights agreement
on March 31, 1999 between the Company and US Stock Transfer Corporation (the
"Rights Agreement"). The Company's Board of Directors has taken all necessary
action under the Rights Agreement so that (x) neither the execution or delivery
of the Merger Agreement, or the Stockholders' Agreement, nor the consummation of
the Offer will cause (i) the Rights to become exercisable under the Rights
Agreement, (ii) Parent, IBA GP or Purchaser to be deemed an "Acquiring Person"
(as defined in the Rights Agreement), or (iii) the "Distribution Date" (as
defined in the Rights Agreement) to occur upon any such event and (y) the
expiration of the Rights shall occur immediately prior to the Effective Time.
17. FEES AND EXPENSES
Parent has retained MacKenzie Partners, Inc. to act as the Information Agent
and IBJ Whitehall Bank & Trust Company to serve as the Depositary in connection
with the Offer. The Information Agent and the Depositary each will receive
reasonable and customary compensation for their services and be reimbursed for
certain reasonable out-of-pocket expenses. Parent has also agreed to indemnify
the Information Agent and the Depositary against certain liabilities and
expenses in connection with the Offer, including certain liabilities under the
federal securities laws.
Parent has retained Bear, Stearns & Co. Inc. as Dealer Manager in connection
with the Offer. Parent has also agreed to pay the Dealer Manager customary fees
and reimburse the Dealer Manager for its out-of-pocket expenses, including the
reasonable fees and expenses of its counsel in connection with its engagement
and to indemnify the Dealer Manager against certain liabilities under the
federal securities laws. In the ordinary course of its business, the Dealer
Manager engages in securities trading, market and brokerage activities and may,
at any time, hold long or short positions and may trade or otherwise effect
transactions in securities of the Company. As of June 16, 1999, the Dealer
Manager had no position in the Shares held for its own account.
Parent will not pay any fees or commissions to any broker or dealer or any
other person for soliciting tenders of Shares pursuant to the Offer (other than
to the Information Agent and the Dealer Manager). Brokers, dealers, commercial
banks, trust companies and other nominees will, upon request, be reimbursed by
IBA for customary mailing and handling expenses incurred by them in forwarding
offering materials to their customers.
33
<PAGE>
18. MISCELLANEOUS
The Offer is not being made to (nor will tenders be accepted from or on
behalf of) holders of Shares in any jurisdiction in which the making of the
Offer or the acceptance thereof would not be in compliance with the securities,
blue sky or other laws of such jurisdiction. To the extent Purchaser or Parent
becomes aware of any state law that would limit the class of offerees in the
Offer, Purchaser reserves the right to amend the Offer and, depending on the
timing of such amendment, if any, will extend the Offer to provide adequate
dissemination of such information to holders of Shares prior to the expiration
of the Offer. In any jurisdiction the securities, blue sky or other laws of
which require the Offer to be made by a licensed broker or dealer, the Offer is
being made on behalf of Purchaser by the Dealer Manager or one or more
registered brokers or dealers licensed under the laws of such jurisdiction.
No person has been authorized to give any information or to make any
representation on behalf of Purchaser or Parent not contained herein or in the
Letter of Transmittal and, if given or made, such information or representation
must not be relied upon as having been authorized. Neither the delivery of this
Offer to Purchase nor any purchase pursuant to the Offer shall, under any
circumstances, create any implication that there has been no change in the
affairs of Purchaser, IBA or the Company since the date as of which information
is furnished or the date of this Offer to Purchase.
Purchaser and Parent have filed with the Commission a Tender Offer Statement
on Schedule 14D-1, together with exhibits, pursuant to Rule 14d-3 under the
Exchange Act, furnishing certain additional information with respect to the
Offer, and may file amendments thereto.
Purchaser and Parent anticipate that the Company will file with the
Commission a Solicitation/ Recommendation Statement on Schedule 14D-9, together
with exhibits, pursuant to Rule 14d-9 under the Exchange Act, setting forth the
recommendations of the Board of Directors with respect to the Offer and the
reasons for such recommendations and furnishing certain additional related
information. Such Schedules and any amendments thereto, including exhibits, may
be inspected and copies may be obtained from the Commission in the manner set
forth in Section 7 (except that they will not be available at the regional
offices of the Commission).
June 17, 1999
34
<PAGE>
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF PARENT, BELGABEAM, IBA GP AND PURCHASER
IBA
The following table sets forth the name, business or residence address,
principal occupation or employment at the present time and during the last five
years, and the name of any corporation or other organization in which such
employment is conducted or was conducted, of each executive officer or director
of IBA. Except as otherwise indicated, all of the persons listed below are
citizens of the Kingdom of Belgium. Each occupation set forth opposite a
person's name, unless otherwise indicated, refers to employment with IBA. Unless
otherwise indicated, the principal business address of each director or
executive officer is Ion Beam Applications s.a., Chemin du Cyclotron, 3, B-1348
Louvain-la-Neuve, Belgium.
<TABLE>
<CAPTION>
NAME, CITIZENSHIP AND PRESENT OCCUPATION OR
CURRENT BUSINESS ADDRESS EMPLOYMENT MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS
- ----------------------------------- --------------------- ------------------------------------------------------
<S> <C> <C>
Yves Jongen President; Director President since March 28, 1986. Head of Cyclotron
Laboratory at the University of Louvain, Belgium from
July 1, 1970 to March 28, 1986.
Pierre Mottet Chief Executive CEO since January 1, 1995. Executive Vice- President
Officer from January 1, 1990 to December 31, 1994;
Vice-President Marketing and Sales from April 15, 1987
to December 31, 1989.
Eric de Lamotte Chief Financial CFO since February 1, 1991.
Officer
Jean-Louis Bol Technical Director Technical Director since 1992.
Ahmet Cokragan Vice President of Vice President of Marketing and Sales since 1989.
Marketing and Sales
Philippe de Woot de Trixhe Director President of the Board since 1987. Professor at the
University of Louvain-la-Neuve, Belgium. Board Member
of Generale de Banque, Brussels, Belgium; Glaceries de
Saint Roch, Brussels, Belgium; Alcatel-Etca,
Charleroi, Belgium; Bull Belgique.
Ferdinand d'Oultremont Director Representative is a Director since 1994. Chairman and
Manager of Sopartec S.A., a Belgian venture capital
company, from 1991 to 1999.
Tenet Healthcare Corporation, Director United States citizen. Vice-President, Acquisitions
represented by Donald W. Thayer and Development at Tenet Healthsystem and Executive
Vice-President at Proton Therapy Corp. of America from
July 1978 to the present.
Belgabeam, represented by Pierre Director Representative is CEO of IBA
Mottet
Institut des Radioelements, Director Financial Manager at Institut des Radio Elements,
represented by Nicole Destexhe Fleurus, Belgium, since January 1991.
Banque Bruxelles Lambert Director Managing Director of Brussels office and Private
represented by Banking at Banque Bruxelles Lambert.
Jacques de Vaucleroy
Nivelinvest, represented by Director Executive President and CEO at Nivelinvest S.A., a
Jean-Pierre Dubois venture capital company, since December 1994.
</TABLE>
I-1
<PAGE>
BELGABEAM
The following table sets forth the name, business or residence address,
principal occupation or employment at the present time and during the last five
years, and the name of any corporation or other organization in which such
employment is conducted or was conducted of each executive officer or director
of Belgabeam. Except as otherwise indicated, all of the persons listed below are
citizens of the Kingdom of Belgium. Each occupation set forth opposite a
person's name, unless otherwise indicated, refers to employment with Belgabeam.
Unless otherwise indicated, the principal business address of each director or
executive officer is Ion Beam Applications s.a., Chemin du Cyclotron, 3, B-1348
Louvain-la-Neuve, Belgium.
<TABLE>
<CAPTION>
NAME, CITIZENSHIP AND PRESENT OCCUPATION OR
CURRENT BUSINESS ADDRESS EMPLOYMENT MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS
- ----------------------------------- --------------------- ------------------------------------------------------
<S> <C> <C>
Yves Jongen Chairman of the Board President of IBA since March 28, 1986. Head of
Cyclotron Laboratory at the University of Louvain,
Belgium from July 1, 1970 to March 28, 1986.
Pierre Mottet Director CEO of IBA since January 1, 1995. Executive
Vice-President at IBA from January 1, 1990 to December
31, 1994; Vice-President Marketing and Sales at IBA
from April 15, 1987 to December 31, 1989.
Eric de Lamotte Director CFO at IBA since February 1, 1991.
Jean-Louis Bol Director Technical Director at IBA since 1992.
Ahmet Cokragan Director Vice President of Marketing and Sales
</TABLE>
IBA GP
There are two partners of IBA GP: IBA and IBA Participations SPRL, a Belgian
limited liability company ("Participations"). Information concerning the
executive officers and directors of IBA is set forth above. Pierre Mottet and
Eric de Lamotte are Director and Administrator, respectively, of Participations.
The following table sets forth the name, business or residence address,
principal occupation or employment at the present time and during the last five
years, and the name of any corporation or other organization in which such
employment is conducted or was conducted of each executive officer or director
of Participations. Except as otherwise indicated, all of the persons listed
below are citizens of the Kingdom of Belgium. Each occupation set forth opposite
a person's name, unless otherwise indicated, refers to employment with IBA GP.
Additional information for Messieurs Mottet and de Lamotte is set forth above.
PURCHASER
The following table sets forth the name, business or residence address,
principal occupation or employment at the present time and during the last five
years, and the name of any corporation or other organization in which such
employment is conducted or was conducted of each executive officer or director
of Purchaser. Except as otherwise indicated, all of the persons listed below are
citizens of the Kingdom of Belgium. Each occupation set forth opposite a
person's name, unless otherwise indicated, refers to employment with Purchaser.
Unless otherwise indicated, the principal business address of each director or
executive officer is Ion Beam Applications s.a., Chemin du Cyclotron, 3, B-1348
Louvain-la-Neuve, Belgium.
I-2
<PAGE>
<TABLE>
<CAPTION>
NAME, CITIZENSHIP AND PRESENT OCCUPATION OR
CURRENT BUSINESS ADDRESS EMPLOYMENT MATERIAL POSITIONS HELD DURING THE PAST FIVE YEARS
- ----------------------------------- --------------------- ------------------------------------------------------
<S> <C> <C>
Yves Jongen Secretary President of IBA since March 28, 1986. Head of
Cyclotron Laboratory at the University of Louvain,
Belgium from July 1, 1970 to March 28, 1986.
Pierre Mottet President CEO of IBA since January 1, 1995. Executive
Vice-President at IBA from January 1, 1990 to December
31, 1994; Vice-President Marketing and Sales at IBA
from April 15, 1987 to December 31, 1989.
Eric de Lamotte Treasurer CFO of IBA since February 1, 1991.
</TABLE>
I-3
<PAGE>
ANNEX A
TEXT OF SECTION 262 OF TITLE B, CHAPTER 1, SUB-CHAPTER IX OF THE DELAWARE
GENERAL CORPORATION LAW 262
APPRAISAL RIGHTS
(a) Any stockholder of a corporation of this State who holds shares of stock
on the date of the making of a demand pursuant to subsection (d) of this section
with respect to such shares, who continuously holds such shares through the
effective date of the merger or consolidation, who has otherwise complied with
subsection (d) of this section and who has neither voted in favor of the merger
or consolidation nor consented thereto in writing pursuant to Section228 of this
title shall be entitled to an appraisal by the Court of Chancery of the fair
value of the stockholder's shares of stock under the circumstances described in
subsections (b) and (c) of this section. As used in this section, the word
"stockholder" means a holder of record of stock in a stock corporation and also
a member of record of a non-stock corporation; the words "stock" and "share"
mean and include what is ordinarily meant by those words and also membership or
membership interest of a member of a nonstock corporation; and the words
"depository receipt" mean a receipt or other instrument issued by a depository
representing an interest in one or more shares, or fractions thereof, solely of
stock of a corporation, which stock is deposited with the depository.
(b) Appraisal rights shall be available for the shares of any class or
series of stock of a constituent corporation in a merger or consolidation to be
effected pursuant to Section251 (other than a merger effected pursuant to
Section251(g) of this title), Section252, Section254, Section257, Section258,
Section263 or Section264 of this title:
(1) Provided, however, that no appraisal rights under this section shall be
available for the shares of any class or series of stock, which stock, or
depository receipts in respect thereof, at the record date fixed to
determine the stockholders entitled to receive notice of and to vote at
the meeting of stockholders to act upon the agreement of merger or
consolidation, were either (i) listed on a national securities exchange
or designated as a national market system security on an interdealer
quotation system by the National Association of Securities Dealers, Inc.
or (ii) held of record by more than 2,000 holders; and further provided
that no appraisal rights shall be available for any shares of stock of
the constituent corporation surviving a merger if the merger did not
require for its approval the vote of the stockholders of the surviving
corporation as provided in subsection (f) of Section251 of this title.
(2) Notwithstanding paragraph (1) of this subsection, appraisal rights under
this section shall be available for the shares of any class or series of
stock of a constituent corporation if the holders thereof are required by
the terms of an agreement of merger or consolidation pursuant to
SectionSection251, 252, 254, 257, 258, 263 and 264 of this title to
accept for such stock anything except:
(a) Shares of stock of the corporation surviving or resulting from such
merger or consolidation or depository receipts in respect thereof;
(b) Shares of stock of any other corporation, or depository receipts in
respect thereof, which shares of stock (or depository receipts in
respect thereof) or depository receipts at the effective date of the
merger or consolidation will be either listed on a national
securities exchange or designated as a national market system
security on an interdealer quotation system by the National
Association of Securities Dealers, Inc. or held of record by more
than 2,000 holders;
(c) Cash in lieu of fractional shares or fractional depository receipts
described in the foregoing subparagraphs a. and b. of this paragraph;
or
A-1
<PAGE>
(d) Any combination of the shares of stock, depository receipts and cash
in lieu of fractional shares or fractional depository receipts
described in the foregoing subparagraphs a., b. and c. of this
paragraph.
(3) In the event all the stock of a subsidiary Delaware corporation party to
a merger effected under Section253 of this title is not owned by the
parent corporation immediately prior to the merger, appraisal rights
shall be available for the shares of the subsidiary Delaware corporation.
(c) Any corporation may provide in its certificate of incorporation that
appraisal rights under this section shall be available for the shares of any
class or series of its stock as a result of an amendment to its certificate of
incorporation, any merger or consolidation in which the corporation is a
constituent corporation or the sale of all or substantially all of the assets of
the corporation. If the certificate of incorporation contains such a provision,
the procedures of this section, including those set forth in subsections (d) and
(e) of this section, shall apply as nearly as is practicable.
(d) Appraisal rights shall be perfected as follows:
(1) If a proposed merger or consolidation for which appraisal rights are
provided under this section is to be submitted for approval at a meeting
of stockholders, the corporation, not less than 20 days prior to the
meeting, shall notify each of its stockholders who was such on the record
date for such meeting with respect to shares for which appraisal rights
are available pursuant to subsections (b) or (c) hereof that appraisal
rights are available for any or all of the shares of the constituent
corporations, and shall include in such notice a copy of this section.
Each stockholder electing to demand the appraisal of SUCH STOCKHOLDER'S
shares. Such demand will be sufficient if it reasonably informs the
corporation of the identity of the stockholder and that the stockholder
intends thereby to demand the appraisal of SUCH STOCKHOLDER'S shares
shall deliver to the Corporation, before the taking of the Note on the
merger or consolidation, a written demand for appraisal of such
STOCKHOLDERS shares. Such demand will be sufficient if it reasonably
informs the corporation of the identity of the stockholder and that the
stockholder intends thereby to demand the appraisal of SUCH STOCKHOLDER'S
shares. A proxy or vote against the merger or consolidation shall not
constitute such a demand. A stockholder electing to take such action must
do so by a separate written demand as herein provided. Within 10 days
after the effective date of such merger or consolidation, the surviving
or resulting corporation shall notify each stockholder of each
constituent corporation who has complied with this subsection and has not
voted in favor of or consented to the merger or consolidation of the date
that the merger or consolidation has become effective; or
(2) If the merger or consolidation was approved pursuant to Section228 or
Section253 of this title, each constituent corporation, either before the
effective date of the merger or consolidation or within ten days
thereafter, shall notify each of the holders of any class or series of
stock of such constituent corporation who are entitled to appraisal
rights of the approval of the merger or consolidation and that appraisal
rights are available for any or all shares of such class or series of
stock of such constituent corporation, and shall include in such notice a
copy of this section; provided that, if the notice is given on or after
the effective date of the merger or consolidation, such notice shall be
given by the surviving or resulting corporation to all such holders of
any class or series of stock of a constituent corporation that are
entitled to appraisal rights. Such notice may, and if, given on or after
the effective date of the merger or consolidation, shall, also notify
such stockholders of the effective date of the merger or consolidation.
Any stockholder entitled to appraisal rights may, within 20 days after
the date of mailing of such notice, demand in writing from the surviving
or resulting corporation the appraisal of such holder's shares. Such
demand will be sufficient if it reasonably informs the corporation of the
identity of the stockholder and that the stockholder intends thereby to
demand the appraisal of such holder's shares. If such notice did not
notify stockholders of the effective date of the merger or consolidation,
either
A-2
<PAGE>
(i) each such constituent corporation shall send a second notice before
the effective date of the merger or consolidation notifying each of the
holders of any class or series of stock of such constituent corporation
that are entitled to appraisal rights of the effective date the merger or
consolidation or (ii) the surviving or resulting corporation shall send
such a second notice to all such holders on or within 10 days after such
effective date; provided, however, that if such second notice is sent
more than 20 days following the sending of the first notice, such second
notice need only be sent to each stockholder who is entitled to appraisal
rights and who has demanded appraisal of such holders' shares in
accordance with this subsection. An affidavit of the secretary or
assistant secretary or of the transfer agent of the corporation that is
required to give either notice that such notice has been given shall, in
the absence of fraud, be prima facie evidence of the facts stated
therein. For purposes of determining the stockholders entitled to receive
either notice, each constituent corporation may fix, in advance, a record
date that shall be not more than 10 days prior to the date the notice is
given, provided, that if the notice is given on or after the effective
date of the merger or consolidation, the record date shall be such
effective date. If no record date is fixed and the notice is given prior
to the effective date, the record date shall be the close of business on
the day next preceding the day on which the notice is given.
(e) Within 120 days after the effective date of the merger consolidation,
the surviving or resulting corporation or any stockholder who has complied with
subsections (a) and (d) hereof and who is otherwise entitled to appraisal
rights, may file a petition in the Court of Chancery demanding a determination
of the value of the stock of all such stockholders. Notwithstanding the
foregoing, at any time within 60 days after the effective date of the merger or
consolidation, any stockholder shall have the right to withdraw SUCH
STOCKHOLDER'S demand for appraisal and to accept the terms offered upon the
merger or consolidation. Within 120 days after the effective date of the merger
or consolidation, any stockholder who has complied with the requirements of
subsections (a) and (d) hereof, upon written request, shall be entitled to
receive from the corporation surviving the merger or resulting from the
consolidation a statement setting forth the aggregate number of shares not voted
in favor of the merger or consolidation and with respect to which demands for
appraisal have been received by and the aggregate number of holders of such
shares. Such written statement shall be mailed to the stockholder within 10 days
after SUCH STOCKHOLDER'S written request for such a statement is received the
surviving or resulting corporation or within 10 days after expiration of the
period for delivery of demands for appraisal under subsection (d) hereof,
whichever is later.
(f) Upon the filing of any such petition by a stockholder, service of a copy
thereof shall be made upon the surviving or resulting corporation, which shall
within 20 days after such service file in the office of the Register in Chancery
in which the petition was filed a duly verified list containing the names and
addresses of all stockholders who have demanded payment for their shares and
with whom agreements as to the value of their shares have not been reached by
the surviving or resulting corporation. If the petition shall be filed by the
surviving or resulting corporation, the petition shall be accompanied by such a
duly verified list. The Register in Chancery, if so ordered by the Court, shall
give notice of the time and place fixed for the hearing of such petition by
registered or certified mail to the surviving or resulting corporation and to
the stockholders shown on the list at the addresses therein stated. Such notice
shall also be given by 1 or more publications at least 1 week before the day of
the hearing, in a newspaper of general circulation published in the City of
Wilmington, Delaware, or such publication as the Court deems advisable. The
forms of the notices by mail and by publication shall be approved by the Court,
and the costs thereof shall be borne by the surviving or resulting corporation.
(g) At the hearing on such petition, the Court shall determine the
stockholders who have complied with this section and who have become entitled to
appraisal rights. The Court may require the stockholders who have demanded an
appraisal for their shares and who hold stock represented by certificates to
submit their certificates of stock to the Register in Chancery for notation
thereon of the pendency of the appraisal proceedings, and if any stockholder
fails to comply with such direction, the Court may dismiss the proceedings as to
such stockholder.
A-3
<PAGE>
(h) After determining the stockholders entitled to an appraisal, the Court
shall appraise the shares, determining their fair value exclusive of any element
of value arising from the accomplishment or expectation of the merger or
consolidation, together with a fair rate of interest, if any, to be paid upon
the amount determined to be the fair value. In determining such fair value, the
Court shall taken in to account all relevant factors. In determining the fair
rate of interest, the Court may consider all relevant factors, including the
rate of interest which the surviving or resulting corporation would have had to
pay to borrow money during the pendency of the proceedings. Upon application by
the surviving or resulting corporation or by any stockholder entitled to
participate in the appraisal proceedings, the Court may, in its discretion,
permit discovery or other pretrial proceedings and may proceed to trial upon the
appraisal prior to the final determination of the stockholder entitled to an
appraisal. Any stockholder whose name appears on the list filed by the surviving
or resulting corporation pursuant to subsection (f) of this section and who has
submitted SUCH STOCKHOLDER'S certificates of stock to the Register in Chancery,
if such is required, may participate fully in all proceedings until it is
finally determined that SUCH STOCKHOLDER is not entitled to appraisal rights
under this section.
(i) The Court shall direct the payment of the fair value of the shares,
together with interest, if any, by the surviving or resulting corporation to the
stockholders entitled thereto. Interest may be simple or compound, as the Court
may direct. Payment shall be so made to each such stockholder, in the case of
holders of uncertificated stock forthwith, and the case of holders of shares
represented by certificates upon the surrender to the corporation of the
certificates represented by certificates upon the surrender to the corporation
of the certificates representing such stock. The Court's decree may be enforced
as other decrees in the Court of Chancery may be enforced, whether such
surviving or resulting corporation be a corporation of this State or of any
state.
(j) The costs of the proceeding may be determined by the Court and taxed
upon the parties as the Court deems equitable in the circumstances. Upon
application of a stockholder, the Court may order all or a portion of the
expenses incurred by any stockholder in connection with the appraisal
proceeding, including, without limitation, reasonable attorney's fees and the
fees and expenses of experts, to be charged pro rata against the value of all
the shares entitled to an appraisal.
(k) From and after the effective date of the merger or consolidation, no
stockholder who has demanded appraisal rights as provided in subsection (d) of
this section shall be entitled to vote such stock for any purpose or to receive
payment of dividends or other distributions on the stock (except dividends or
other distributions payable to stockholders of record at a date which is prior
to the effective date of the merger or consolidation); provided, however, that
if no petition for an appraisal shall be filed within the time provided in
subsection (e) of this section, or if such stockholder shall deliver to the
surviving or resulting corporation a written withdrawal of SUCH STOCKHOLDER'S
demand for an appraisal and an acceptance of the merger or consolidation, either
within 60 days after the effective date of the merger or consolidation as
provided in subsection (e) of this section or thereafter with the written
approval of the corporation, then the right of such stockholder to an appraisal
shall cease. Notwithstanding the foregoing, no appraisal proceeding in the Court
of Chancery shall be dismissed as to any stockholder without the approval of the
Court, and such approval may be conditioned upon such terms as the Court deems
just.
(l) The shares of the surviving or resulting corporation to which the shares
of such objecting stockholders would have been converted had they assented to
the merger or consolidation shall have the status of authorized and unissued
shares of the surviving or resulting corporation.
A-4
<PAGE>
(This page intentionally left blank)
A-5
<PAGE>
Manually signed facsimile copies of the Letter of Transmittal will be
accepted. Letters of Transmittal and certificates for Shares should be sent or
delivered by each stockholder of the Company or his broker, dealer, commercial
bank or trust company to the Depositary at one of its addresses set forth below:
THE DEPOSITARY FOR THE OFFER IS:
IBJ Whitehall Bank and Trust Company
<TABLE>
<CAPTION>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
<S> <C> <C>
P.O. Box 84 One State Street Plaza One State Street Plaza
Bowling Green Station New York, NY 10004 New York, NY 10004
New York, NY 10274-0084 Attn: Securities Processing Attn: Securities Processing
Attn: Reorganization Window Window
Operations Department Subcellar One (SC-1) Subcellar One (SC-1)
</TABLE>
<TABLE>
<CAPTION>
BY FACSIMILE TRANSMISSION:
(FOR ELIGIBLE INSTITUTIONS ONLY) CONFIRM BY TELEPHONE:
<S> <C>
(212) 858-2611 (212) 858-2103
</TABLE>
Any questions or requests for assistance or requests for additional copies
of this Offer to Purchase, the Letter of Transmittal and the Notice of
Guaranteed Delivery may be directed to the Information Agent or the Dealer
Manager at their respective locations and telephone number listed below.
Stockholders may also contact their brokers, dealers, commercial banks or trust
companies for assistance concerning the Offer.
THE INFORMATION AGENT FOR THE OFFER IS:
[LOGO]
156 Fifth Avenue
New York, NY 10010
Toll Free: (800) 322-2885
THE DEALER MANAGER FOR THE OFFER IS:
Bear, Stearns & Co. Inc.
245 Park Avenue
New York, NY 10167
Toll Free: (888) 293-1889
<PAGE>
LETTER OF TRANSMITTAL
TO TENDER SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED RIGHTS TO PURCHASE
SHARES OF SERIES A JUNIOR PARTICIPATING PREFERRED STOCK)
OF
STERIGENICS INTERNATIONAL, INC.
AT
$27.00 NET PER SHARE
PURSUANT TO THE OFFER TO PURCHASE DATED JUNE 17, 1999
OF
IBA ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
ION BEAM APPLICATIONS S.A.
- ----------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT MIDNIGHT, NEW YORK CITY
TIME, ON THURSDAY, JULY 15, 1999, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
THE DEPOSITARY FOR THE OFFER IS:
IBJ Whitehall Bank and Trust Company
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
PO Box 84 One State Street One State Street
Bowling Green Station New York, NY 10004 New York, NY 10004
New York, NY 10274-0084 Attn: Securities Processing Attn: Securities Processing
Attn: Reorganization Window, Window
Operations Department Subcellar One (SC-1) Subcellar One, (SC-1)
BY FACSIMILE TRANSMISSION: CONFIRM BY TELEPHONE:
(For Eligible Institutions (212) 858-2103
Only)
(212) 858-2611
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN ONE
LISTED ABOVE DOES NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN
THIS LETTER OF TRANSMITTAL IN THE APPROPRIATE SPACE
PROVIDED THEREFOR, WITH SIGNATURE GUARANTEE IF
REQUIRED, AND COMPLETE THE SUBSTITUTE FORM
W-9 SET FORTH BELOW. SEE INSTRUCTION 1.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
This Letter of Transmittal is to be used either if certificates are to be
forwarded herewith or, unless an Agent's Message (as defined in the Offer to
Purchase) is utilized, if delivery is to be made by book-entry transfer to the
account maintained by the Depositary at the Depositary Trust Company (the
"Book-Entry Transfer Facility") pursuant to the procedures set forth in Section
2 of the Offer to Purchase. Stockholders whose certificates are not immediately
available or who cannot deliver their certificates or deliver confirmation of
the book-entry transfer of their Shares (as defined below) into the Depositary's
account at a Book-Entry Transfer Facility ("Book-Entry Confirmation") and all
other documents required hereby to the Depositary on or prior to the Expiration
Date (as defined in the Offer to Purchase) must tender their Shares according to
the guaranteed delivery procedures set forth in Section 2 of the Offer to
Purchase. See Instruction 2. DELIVERY OF DOCUMENTS TO A BOOK-ENTRY TRANSFER
FACILITY DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
<PAGE>
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
MADE TO THE ACCOUNT MAINTAINED BY THE DEPOSITARY WITH A BOOK-ENTRY TRANSFER
FACILITY AND COMPLETE THE FOLLOWING:
Name of Tendering Institution:
Check box if shares will be tendered by book-entry transfer: / /
Account Number
Transaction Code Number
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE
FOLLOWING:
Name(s) of Registered Owner(s):
Window Ticket Number (if any):
Date of Execution of Notice of Guaranteed Delivery:
Name of Institution that Guaranteed Delivery:
If Delivered by Book-Entry Transfer, Check box: / /
Account Number:
Transaction Code Number:
<TABLE>
<CAPTION>
-------------------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
-------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED
HOLDER(S) SHARE CERTIFICATE(S) AND SHARE(S) TENDERED
(PLEASE FILL IN, IF BLANK) (ATTACH ADDITIONAL LIST IF NECESSARY)
- ---------------------------------------------------------------------------------------------
<S> <C> <C> <C>
SHARE TOTAL NUMBER NUMBER OF
CERTIFICATE OF SHARES SHARES
NUMBER(S)* REPRESENTED BY TENDERED**
CERTIFICATE(S)
----------------------------------------------
----------------------------------------------
----------------------------------------------
----------------------------------------------
----------------------------------------------
----------------------------------------------
TOTAL SHARES
- ---------------------------------------------------------------------------------------------
* Need not be completed by stockholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares being delivered to the
Depositary are being tendered. See Instruction 4.
- -------------------------------------------------------------------------------------------
</TABLE>
2
<PAGE>
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ CAREFULLY THE ACCOMPANYING INSTRUCTIONS.
LADIES AND GENTLEMEN:
The undersigned hereby tenders to IBA Acquisition Corp., a Delaware
corporation (the "Purchaser"), which is an indirect wholly-owned subsidiary of
Ion Beam Applications s.a., a Belgian corporation, the above described shares of
Common Stock, par value $.001 per share (the "Common Stock", together with the
associated rights to purchase shares of Series A Junior Participating Preferred
Stock, par value $0.001 per share (the "Right" and together with the common
stock, the "Shares") of SteriGenics International, Inc., a Delaware corporation
(the "Company"), pursuant to Purchaser's offer to purchase all of the
outstanding Shares upon the terms and subject to the conditions set forth in the
Offer to Purchase dated June 17, 1999 (the "Offer to Purchase"), receipt of
which is hereby acknowledged, and in this Letter of Transmittal (which together
constitute the "Offer"), at the purchase price of $27.00 per Share, net to the
tendering stockholder in cash.
Subject to, and effective upon, acceptance for payment of the Shares
tendered herewith in accordance with the terms and subject to the conditions of
the Offer, the undersigned hereby sells, assigns, and transfers to, or upon the
order of, Purchaser all right, title and interest in and to all the Shares that
are being tendered hereby (and any and all other Shares or other securities
issued or issuable in respect thereof on or after the date this Letter of
Transmittal is signed by the undersigned) and irrevocably constitutes and
appoints the Depositary the true and lawful agent and attorney-in-fact of the
undersigned with respect to such Shares (and any such other Shares or
securities) with full power of substitution (such power of attorney being deemed
to be an irrevocable power coupled with an interest), to (a) deliver
certificates for such Shares (and any such other Shares or securities), or
transfer ownership of such Shares (and any such other Shares or securities) on
the account books maintained by a Book-Entry Transfer Facility, together in
either such case with all accompanying evidences of transfer and authenticity,
to or upon the order of Purchaser upon receipt by the Depositary, as the
undersigned's agent, of the purchase price (adjusted, if appropriate, as
provided in the Offer to Purchase), (b) present such Shares (and any such other
Shares or securities) for transfer on the books of the Company and (c) receive
all benefits and otherwise exercise all rights of beneficial ownership of such
Shares (and any such other Shares or securities), all in accordance with the
terms of the Offer.
The undersigned hereby irrevocably appoints each designee of Purchaser as
the attorney-in-fact and proxy of the undersigned, each with full power of
substitution, to vote in such manner as each such attorney and proxy or his
substitute shall in his sole discretion deem proper, and otherwise act
(including pursuant to written consent) with respect to all the Shares tendered
hereby which have been accepted for payment by Purchaser prior to the time of
such vote or action (and any and all other Shares or securities issued or
issuable in respect thereof on or after the date this Letter of Transmittal is
signed by the undersigned), which the undersigned is entitled to vote at any
meeting of stockholders (whether annual or special and whether or not an
adjourned meeting) of the Company, or consent in lieu of any such meeting, or
otherwise. This proxy is coupled with an interest in the Company and in the
Shares and is irrevocable and is granted in consideration of, and is effective
upon, the deposit by Purchaser with the Depositary of the purchase price for
such Shares in accordance with the terms of the Offer. Such acceptance for
payment shall revoke all prior proxies granted by the undersigned at any time
with respect to such Shares (and any such other Shares or other securities) and
no subsequent proxies will be given (and if given will be deemed not to be
effective) with respect thereto by the undersigned.
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, sell, assign and transfer the Shares tendered
hereby (and any and all other Shares or other securities issued or issuable in
respect thereof on or after the date this Letter of Transmittal is signed by the
undersigned) and that, when the same are accepted for payment by Purchaser,
Purchaser will acquire good and unencumbered title thereto, free and clear of
all liens, restrictions, charges and encumbrances
3
<PAGE>
and the same will not be subject to any adverse claim. The undersigned, upon
request, will execute and deliver any additional documents deemed by the
Depositary or Purchaser to be necessary or desirable to complete the sale,
assignment and transfer of the Shares tendered hereby (and any and all such
other Shares or other securities).
All authority herein conferred or agreed to be conferred in this Letter of
Transmittal shall not be affected by, and shall survive, the death or incapacity
of the undersigned and any obligation of the undersigned hereunder shall be
binding upon the successors, assigns, heirs, executors, administrators and legal
representatives of the undersigned. Except as stated in the Offer to Purchase,
this tender is irrevocable.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described in Section 2 of the Offer to Purchase and in the
instructions hereto will constitute a binding agreement between the undersigned
and Purchaser upon the terms and subject to the conditions of the Offer.
Unless otherwise indicated herein under "Special Payment Instructions,"
please issue the check for the purchase price or any certificates for Shares not
tendered or accepted for payment in the name(s) of the undersigned. Similarly,
unless otherwise indicated under "Special Delivery Instructions," please mail
the check for the purchase price or return any certificates for Shares not
tendered or accepted for payment (and accompanying documents, as appropriate) to
the undersigned at the address shown below the undersigned's signature. In the
event that both the Special Delivery Instructions and the Special Payment
Instructions are completed, please issue the check for the purchase price or any
certificates for Shares not tendered or accepted for payment in the name of, and
deliver such check or return such certificates to the person or persons so
indicated. Stockholders delivering Shares by book-entry transfer may request
that any Shares not accepted for payment be returned by crediting such account
maintained at a Book-Entry Transfer Facility as such stockholder may designate
by making an appropriate entry under "Special Payment Instructions." The
undersigned recognizes that Purchaser has no obligation pursuant to the Special
Payment Instructions to transfer any Shares from the name of the registered
holder thereof if Purchaser does not accept for payment any of the Shares so
tendered.
4
<PAGE>
- -------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if certificates for Shares not tendered or not
purchased and/or the check for the purchase price of Shares purchased are to
be issued in the name of someone other than the undersigned, or if Shares
delivered by book-entry transfer which are not purchased are to be returned
by credit to an account maintained at a Book-Entry Transfer Facility other
than that designated above.
Issue check and/or certificate to:
Name _______________________________________________________________________
(PLEASE PRINT)
Address ____________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
(INCLUDING ZIP CODE)
__________________________________________________________________________
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER)
/ / Credit unpurchased Shares delivered by book-entry transfer to the
Book-Entry Transfer Facility account set forth below.
____________________________________________________________________________
(ACCOUNT NUMBER)
- ------------------------------------------------------
- ------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 4, 5, 6 AND 7)
To be completed ONLY if certificates for Shares not tendered or not
purchased and/or the check for the purchase price of Shares purchased are to
be sent to someone other than the undersigned, or to the undersigned at an
address other than that shown above.
Issue check and/or certificate to:
Name _______________________________________________________________________
(PLEASE PRINT)
Address ____________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
(INCLUDING ZIP CODE)
__________________________________________________________________________
(TAX IDENTIFICATION OF SOCIAL SECURITY NUMBER)
- -----------------------------------------------------
5
<PAGE>
- --------------------------------------------------------------------------------
SIGN HERE
(COMPLETE SUBSTITUTE FORM W-9 ON REVERSE)
X __________________________________________________________________________
____________________________________________________________________________
X __________________________________________________________________________
____________________________________________________________________________
(SIGNATURE(S) OF OWNER(S))
Dated: __________________, 1999
(Must be signed by registered holder(s) exactly as name(s) appear(s) on
stock certificate(s) or on a security position listing or by person(s)
authorized to become registered holder(s) by certificates and documents
transmitted herewith. If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, agent, officer of a corporation or other person
acting in a fiduciary or representative capacity, please provide the
following information. See Instructions 1 and 5.)
Name(s) ____________________________________________________________________
____________________________________________________________________________
(PLEASE PRINT)
Capacity (Full Title) ______________________________________________________
(SEE INSTRUCTION 5)
Address ____________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Telephone Number ( )________________________________________
Employer Identification or Social Security Number __________________________
(COMPLETE SUBSTITUTE FORM W-9 ON REVERSE)
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED--SEE INSTRUCTIONS 1 AND 5)
Authorized Signature _______________________________________________________
Name _______________________________________________________________________
(PLEASE PRINT)
TITLE ______________________________________________________________________
NAME OF FIRM _______________________________________________________________
ADDRESS ____________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Telephone Number ( )________________________________________
Dated: __________________, 1999
- --------------------------------------------------------------------------------
6
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. No signature guarantee on this Letter of
Transmittal is required (i) if this Letter of Transmittal is signed by the
registered holder of the Shares (which term, for purposes of this document,
shall include any participant in a Book-Entry Transfer Facility whose name
appears on a security position listing as the owner of Shares) tendered
herewith, unless such holder has completed either the box entitled "Special
Delivery Instructions" or the box entitled "Special Payment Instructions" on the
reverse hereof, or (ii) if such Shares are tendered for the account of a bank,
broker, dealer, credit union, savings association or other entity that is a
member in good standing of the Securities Transfer Agents Medallion Program, the
New York Stock Exchange Medallion Signature Guarantee Program or the Stock
Exchange Medallion Program (each an "Eligible Institution"). In all other cases,
all signatures on this Letter of Transmittal must be guaranteed by an Eligible
Institution. See Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES. This Letter of
Transmittal is to be completed by stockholders if certificates are to be
forwarded herewith or if tenders of Shares are to be made pursuant to the
procedures for delivery by book-entry transfer set forth in Section 2 of the
Offer to Purchase. Certificates for all physically tendered Shares, or any
Book-Entry Confirmation of Shares, as the case may be, as well as a properly
completed and duly executed Letter of Transmittal (or facsimile thereof), unless
an Agent's Message (as defined in the Offer to Purchase) is utilized, and any
other documents required by this Letter of Transmittal, must be received by the
Depositary at one of its addresses set forth herein on or prior to the
Expiration Date (as defined in Section 1 of the Offer to Purchase). Stockholders
whose certificates for Shares are not immediately available or who cannot
deliver their certificates and all other required documents to the Depositary on
or prior to the Expiration Date may tender their Shares by properly completing
and duly executing the Notice of Guaranteed Delivery pursuant to the guaranteed
delivery procedure set forth in Section 2 of the Offer to Purchase. Pursuant to
such procedure, (i) such tender must be made by or through an Eligible
Institution, (ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form provided by Purchaser, must be received by
the Depositary prior to the Expiration Date, and (iii) the certificates for all
physically tendered Shares or Book-Entry Confirmation of Shares, as the case may
be, together with a properly completed and duly executed Letter of Transmittal
(or facsimile thereof), unless an Agent's Message is utilized, and any other
documents required by this Letter of Transmittal, must be received by the
Depositary within three Nasdaq National Market trading days after the date of
execution of such Notice of Guaranteed Delivery, all as provided in Section 2 of
the Offer to Purchase.
THE METHOD OF DELIVERY OF THIS LETTER OF TRANSMITTAL, THE CERTIFICATE FOR
SHARES AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH A BOOK-ENTRY
TRANSFER FACILITY, IS AT THE OPTION AND RISK OF THE TENDERING STOCKHOLDER AND,
EXCEPT AS OTHERWISE PROVIDED IN THIS INSTRUCTION 2, THE DELIVERY WILL BE DEEMED
MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF DELIVERY IS BY MAIL,
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED.
IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted and no
fractional Shares will be purchased. All tendering stockholders, by execution of
this Letter of Transmittal (or facsimile thereof), waive any right to receive
any notice of the acceptance of their Shares for payment.
3. INADEQUATE SPACE. If the space provided herein is inadequate, the
certificate numbers and/or the number of Shares should be listed on a separate
signed schedule attached hereto.
7
<PAGE>
4. PARTIAL TENDERS. (Not applicable to stockholders who tender by
book-entry transfer.) If fewer than all the Shares evidenced by any certificate
submitted are to be tendered, fill in the number of Shares which are to be
tendered in the box entitled "Number of Shares Tendered." In such case, new
certificate(s) for the remainder of the Shares that were evidenced by your old
certificate(s) will be sent to you, unless otherwise provided in the appropriate
box on this Letter of Transmittal, as soon as practicable after the Expiration
Date. All Shares represented by certificates delivered to the Depositary will be
deemed to have been tendered unless otherwise indicated.
5. SIGNATURES ON LETTER OF TRANSMITTAL, STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the Shares
tendered hereby, the signature(s) must correspond exactly with the name(s) as
written on the face of the certificate(s) without alteration, enlargement or any
change whatsoever.
If any of the Shares tendered hereby are owned of record by two or more
joint owners, all such owners must sign this Letter of Transmittal.
If any tendered Shares are registered in different names on several
certificates, it will be necessary to complete, sign and submit as many separate
Letters of Transmittal as there are different registrations of certificates.
If this Letter of Transmittal or any certificates or stock powers are signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
Purchaser of such person's authority so to act must be submitted.
When this Letter of Transmittal is signed by the registered owner(s) of the
Shares listed and transmitted hereby, no endorsements of certificates or
separate stock powers are required unless payment or certificates for Shares not
tendered or purchased are to be issued to a person other than the registered
owner(s). Signatures on such certificates or stock powers must be guaranteed by
an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered owner(s) of the Shares listed, the certificates must be endorsed or
accompanied by appropriate stock powers, in either case signed exactly as the
name or names of the registered owner or owners appear on the certificates.
Signatures on such certificates or stock powers must be guaranteed by an
Eligible Institution.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6,
Purchaser will pay or cause to be paid any stock transfer taxes with respect to
the transfer and sale of purchased Shares to it or its order pursuant to the
Offer. If payment of the purchase price is to be made to, or if certificates for
Shares not tendered or purchased are to be registered in the name of, any person
other than the registered holder, or if tendered certificates are registered in
the name of any person other than the person(s) signing this Letter of
Transmittal, the amount of any stock transfer taxes (whether imposed on the
registered holder or such person) payable on account of the transfer to such
person will be deducted from the purchase price unless satisfactory evidence of
the payment of such taxes or exemption therefrom is submitted.
EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY FOR
TRANSFER TAX STAMPS TO BE AFFIXED TO THE CERTIFICATES LISTED IN THIS LETTER OF
TRANSMITTAL.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check or certificates
for unpurchased Shares are to be issued in the name of a person other than the
signer of this Letter of Transmittal or if a check is to be sent or such
certificates are to be returned to someone other than the signer of this Letter
of Transmittal or to an address other than that shown above, the appropriate
boxes on this Letter of Transmittal should be completed. Stockholders tendering
Shares by book-entry transfer may request that Shares not purchased be credited
to such account maintained at a Book-Entry Transfer Facility as such stockholder
may designate hereon. If no such instructions are given, such Shares not
purchased will be returned by crediting the account at the Book-Entry Transfer
Facility designated above.
8
<PAGE>
8. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance
may be directed to, or additional copies of the Offer to Purchase, this Letter
of Transmittal and the Notice of Guaranteed Delivery may be obtained from, the
Information Agent at its respective address set forth below or from your broker,
dealer, commercial bank or trust company.
9. WAIVER OF CONDITIONS. Subject to the terms of the Merger Agreement (as
defined in the Offer to Purchase), the conditions of the Offer may be waived by
Purchaser, in whole or in part, at any time and from time to time in the
Purchaser's sole discretion, in the case of any Shares tendered.
10. SUBSTITUTE FORM W-9. The tendering stockholder is required to provide
the Depositary with a correct Taxpayer Identification Number ("TIN") on
Substitute Form W-9 which is provided under "Important Tax Information" below,
and to certify whether the stockholder is subject to backup withholding of
Federal income tax. If a tendering stockholder is subject to backup withholding,
the stockholder must cross out item (2) of the Certification box of the
Substitute Form W-9. Failure to provide the information on the Substitute Form
W-9 may subject the tendering stockholder to 31% Federal income tax withholding
on the payment of the purchase price. If the tendering stockholder has not been
issued a TIN and has applied for a number or intends to apply for a number in
the near future, he or she should write "Applied For" in the space provided for
the TIN in Part I, and sign and date the Substitute Form W-9. If "Applied For"
is written in Part I, the Depositary will withhold 31% on all payments of the
purchase price, but such withholdings will be refunded if the tendering
stockholder provides a TIN within 60 days.
11. LOST, DESTROYED OR STOLEN CERTIFICATES. If any certificate(s)
representing Shares has been lost, destroyed or stolen, the stockholder should
promptly notify the Depositary. The stockholder will then be instructed as to
the steps that must be taken in order to replace the certificate(s). This Letter
of Transmittal and related documents cannot be processed until the procedures
for replacing lost or destroyed certificates have been followed.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A FACSIMILE THEREOF), TOGETHER
WITH CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER AND ALL OTHER REQUIRED
DOCUMENTS, MUST BE RECEIVED BY THE DEPOSITARY, OR THE NOTICE OF GUARANTEED
DELIVERY MUST BE RECEIVED BY THE DEPOSITARY, ON OR PRIOR TO THE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under Federal income tax law, a stockholder whose tendered Shares are
accepted for payment is required to provide the Depositary with such
stockholder's correct TIN on Substitute Form W-9 below. If such stockholder is
an individual, the TIN is his or her social security number. If a tendering
stockholder is subject to backup withholding, he or she must cross out item (2)
of the Certification box on the Substitute Form W-9. If the Depositary is not
provided with the correct TIN, the stockholder may be subject to a $50 penalty
imposed by the Internal Revenue Service. In addition, payments that are made to
such stockholder with respect to Shares purchased pursuant to the Offer may be
subject to backup withholding.
Certain stockholders (including, among others, all corporations and certain
foreign individuals) are not subject to these backup withholding and reporting
requirements. In order for a foreign individual to qualify as an exempt
recipient, that stockholder must submit a statement, signed under penalties of
perjury, attesting to that individual's exempt status. Such statements may be
obtained from the Depositary. Exempt stockholders, other than foreign
individuals, should furnish their TIN, write "Exempt" on the face of the
Substitute Form W-9 below and sign, date and return the Substitute Form W-9 to
the Depositary. See the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional instructions.
If backup withholding applies, the Depositary is required to withhold 31% of
any payments made to the stockholder. Backup withholding is not an additional
tax. Rather, the tax liability of persons subject to backup withholding will be
reduced by the amount of tax withheld. If withholding results in an overpayment
of taxes, a refund may be obtained.
9
<PAGE>
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup withholding on payments that are made to a stockholder
with respect to Shares purchased pursuant to the Offer, the stockholder is
required to notify the Depositary of his or her correct TIN by completing the
form below certifying that the TIN provided on the Substitute Form W-9 is
correct (or that such stockholder is awaiting a TIN).
WHAT NUMBER TO GIVE THE DEPOSITARY
The stockholder is required to give the Depositary the social security
number or employer identification number of the record owner of the Shares. If
the Shares are in more than one name or are not in the name of the actual owner,
consult the enclosed Guidelines for Certification of Taxpayer Identification
Number on Substitute Form W-9 for additional guidelines on which number to
report. If the tendering stockholder has not been issued a TIN and has applied
for a number or intends to apply for a number in the near future, the
stockholder should write "Applied For" in the space provided for the TIN in Part
I, and sign and date the Substitute Form W-9. If "Applied For" is written in
Part I, the Depositary will withhold 31% on all payments of the purchase price,
but such withholdings will be refunded if the tendering stockholder provides a
TIN within 60 days.
10
<PAGE>
PAYOR'S NAME:
<TABLE>
<C> <S> <C>
- -----------------------------------------------------------------------------------------
SUBSTITUTE PART I -- Please Social Security Number or Employer
FORM W-9 provide your TIN in Identification Number
the box at right and (if awaiting TIN write "Applied
certify by signing and For")
dating below.
-----------------------------------------------------------
DEPARTMENT OF THE TREASURY PART II -- For Payees exempt from backup withholding, see
INTERNAL REVENUE SERVICE the attached Guidelines for Certification of Taxpayer
15 Identification Number on Substitute Form W-9 and complete
as instructed therein.
-----------------------------------------------------------
Certification -- Under penalties of perjury, I certify
that:
PAYOR'S REQUEST FOR
TAXPAYER IDENTIFICATION
NUMBER ("TIN")
(1) The number shown on this form is my correct Taxpayer
Identification Number (or a Taxpayer Identification Number
has not been issued to me) and either (a) I have mailed or
delivered an application to receive a Taxpayer
Identification Number to the appropriate Internal Revenue
Service ("IRS") or Social Security Administration office or
(b) I intend to mail or deliver an application in the near
future. (I understand that if I do not provide a Taxpayer
Identification Number to the Depositary, 31% of all
reportable payments made to me will be withheld, but will
be refunded if I provided a certified Taxpayer
Identification Number within 60 days); and
(2) I am not subject to backup withholding either because I
have not been notified by the IRS that I am subject to
backup withholding as a result of a failure to report all
interest or dividends, or the IRS has notified me that I am
no longer subject to backup withholding.
CERTIFICATION INSTRUCTIONS -- You must cross out item (2)
above if you have been notified by the IRS that you are
subject to backup withholding because of underreporting
interest or dividends on your tax return. However, if after
being notified by the IRS that you were subject to backup
withholding you received another notification from the IRS
that you are no longer subject to backup withholding, do
not cross out item (2). (Also see instructions in the
enclosed Guidelines.)
Signature
----------------------Date:
-------------
- -----------------------------------------------------------------------------------------
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW THE
ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON
SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
THE INFORMATION AGENT FOR THE OFFER IS:
[LOGO]
156 Fifth Avenue
New York, New York 10010
(212) 929-5500 (Call Collect)
or
CALL TOLL-FREE: (800) 322-2885
11
<PAGE>
NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF SHARES OF COMMON STOCK
INCLUDING THE ASSOCIATED RIGHTS TO
PURCHASE SHARES OF SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
OF
STERIGENICS INTERNATIONAL, INC.
TO
IBA ACQUISITION GROUP
A WHOLLY OWNED SUBSIDIARY OF
ION BEAM APPLICATIONS S.A.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT MIDNIGHT, NEW YORK CITY
TIME, ON THURSDAY, JULY 15, 1999, UNLESS THE OFFER IS EXTENDED.
This form, or one substantially equivalent hereto, must be used to accept the
Offer (as defined below) if certificates representing shares of common stock,
par value $.001 per share (the "Common Shares"), including the associated rights
to purchase shares of Series A Junior Participating Preferred Stock (the
"Rights" and, together with the Common Stock, the "Shares") of SteriGenics
International, Inc., a Delaware corporation, are not immediately available, if
the procedure for Book-Entry transfer cannot be completed on a timely basis, or
if time will not permit all required documents to reach the Depositary (as
defined in the Offer to Purchase) prior to the Expiration Date (as defined in
the Offer to Purchase). Such form may be delivered by hand or transmitted by
telegram, facsimile transmission or mail to the Depositary. See Section 2 of the
Offer to Purchase.
THE DEPOSITARY FOR THE OFFER IS:
IBJ WHITEHALL BANK AND TRUST COMPANY
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
PO Box 84 One State Street One State Street
Bowling Green Station New York, NY 10004 New York, NY 10004
New York, NY 10274-0084 Attn: Securities Processing Attn: Securities Processing
Attn: Reorganization Window Subcellar One (SC-1) Window Subcellar One (SC-1)
Operations Department
</TABLE>
<TABLE>
<S> <C>
BY FACSIMILE TRANSMISSION: Confirm by Telephone:
(For Eligible Institutions Only) (212) 858-2103
(212) 858-2611
</TABLE>
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION OTHER
THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
Ladies and Gentlemen:
The undersigned hereby tenders to IBA Acquisition Corp., a Delaware corporation
and an indirect, wholly owned subsidiary of Ion Beam Applications s.a., a
Belgian corporation, upon the terms and subject to the conditions set forth in
the Offer to Purchase dated June 17, 1999 and the related Letter of Transmittal
(which together constitute the "Offer"), receipt of which is hereby
acknowledged, the number of Shares indicated below pursuant to the guaranteed
delivery procedures set forth in Section 2 of the Offer to Purchase.
<PAGE>
Certificate No(s). (if available)
Number of Shares:
If delivered by Book-Entry Transfer, check box: / /
Account Number
Dated , 1999
Name(s) of Record Holder(s)
(Please Type or Print)
Address(es)
Area Code and Tel. No.
Signature(s)
<TABLE>
<S> <C> <C>
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a bank, broker, dealer, credit union, savings association or other entity
that is a member in good standing of the Securities Transfer Agents Medallion Program, the
New York Stock Exchange Medallion Signature Guarantee Program or the Stock Exchange Medallion
Program, (a) represents that the above named person(s) "own(s)" the Shares tendered hereby
within the meaning of Rule 14e-4 promulgated under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), (b) represents that such tender of Shares complies with Rule
14e-4 under the Exchange Act, and (c) guarantees delivery to the Depositary, at one of its
addresses set forth above, of certificates representing the Shares tendered hereby in proper
form for transfer, or confirmation of book-entry transfer of such Shares into the
Depositary's accounts at or , in each case with delivery of a
properly completed and duly executed Letter of Transmittal (or facsimile thereof), and any
other required documents, within three Nasdaq National Market trading days after the date
hereof.
Name of Firm:
Authorized Signature
TITLE
Address: Name:
PLEASE TYPE OR PRINT
ZIP CODE Title:
Area Code and Dated: , 1999
Telephone Number:
NOTE: DO NOT SEND SHARE CERTIFICATES WITH THIS NOTICE. SHARE CERTIFICATES SHOULD BE SENT WITH
YOUR LETTER OF TRANSMITTAL.
</TABLE>
<PAGE>
[NAME OF AGENT]
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
INCLUDING THE ASSOCIATED RIGHTS TO PURCHASE
SERIES A JUNIOR PARTICIPATING PREFERRED STOCK
OF
STERIGENICS INTERNATIONAL, INC.
AT
$27.00 NET PER SHARE
BY
IBA ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
ION BEAM APPLICATIONS S.A.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT MIDNIGHT,
NEW YORK CITY TIME, ON THURSDAY JULY 15, 1999 (THE "EXPIRATION DATE"),
UNLESS THE OFFER IS EXTENDED.
June 17, 1999
To Brokers, Dealers, Commercial Banks,
Trust Companies And Other Nominees:
We have been engaged to act as Information Agent in connection with the offer by
IBA Acquisition Corp., a Delaware corporation ("Purchaser"), and an indirect
wholly owned subsidiary of Ion Beam Applications s.a., a Belgian corporation, to
purchase all outstanding shares of common stock, par value $.001 per share (the
"Shares"), of SteriGenics International, Inc., a Delaware corporation (the
"Company"), at $27.00 per Share, net to the seller in cash, upon the terms and
subject to the conditions set forth in Purchaser's Offer to Purchase dated June
17, 1999 (the "Offer to Purchase") and the related Letter of Transmittal (which
together constitute the "Offer").
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THE SATISFACTION OR WAIVER OF
CERTAIN CONDITIONS TO THE OBLIGATIONS OF PURCHASER AND THE COMPANY TO CONSUMMATE
THE OFFER, INCLUDING (1) THERE BEING VALIDLY TENDERED AND NOT WITHDRAWN PRIOR TO
THE EXPIRATION DATE THAT NUMBER OF SHARES OF COMMON STOCK, TOGETHER WITH
ASSOCIATED RIGHTS TO PURCHASE SHARES OF SERIES A JUNIOR PARTICIPATING PREFERRED
STOCK, WHICH, WHEN COMBINED WITH THE SHARES ALREADY OWNED BY PARENT, PURCHASER
AND THEIR AFFILIATES, CONSTITUTES A MAJORITY OF THE TOTAL NUMBER OF OUTSTANDING
SHARES ON A DILUTED BASIS (INCLUDING FOR PURPOSES OF SUCH CALCULATION ALL SHARES
ISSUABLE UPON EXERCISE OF ALL VESTED AND UNVESTED STOCK OPTIONS, AND CONVERSION
OF CONVERTIBLE SECURITIES OR OTHER RIGHTS TO PURCHASE OR ACQUIRE SHARES AND (2)
RECEIPT BY PURCHASER AND THE COMPANY OF CERTAIN GOVERNMENTAL AND REGULATORY
APPROVALS.
For your information and for forwarding to your clients for whom you hold Shares
registered in your name or in the name of your nominee, or who hold Shares
registered in their own names, we are enclosing the following documents:
1. Offer to Purchase dated June 17, 1999;
<PAGE>
2. Letter of Transmittal to tender Shares for your use and for the information
of your clients. Facsimile copies of the Letter of Transmittal may be used
to tender Shares;
3. Letter to Clients which may be sent to your clients for whose account you
hold Shares in your name or in the name of your nominees, with space
provided for obtaining such clients' instructions with regard to the Offer;
4. Notice of Guaranteed Delivery to be used to accept the Offer if certificates
for Shares are not immediately available or time will not permit all
required documents to reach the Depositary prior to the Expiration Date (as
defined in the Offer to Purchase) or if the procedures for book-entry
transfer, as set forth in the Offer to Purchase, cannot be completed on a
timely basis;
5. The Letter to Stockholders of the Company from James F. Clouser, the
President and Chief Executive Officer of the Company, accompanied by the
Company's Solicitation/Recommendation Statement on Schedule 14D-9.
6. Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9; and
7. Return envelope addressed to IBJ Whitehall Bank and Trust Company, as
Depositary.
Upon the terms and subject to the satisfaction or waiver (where applicable) of
the conditions of the Offer, Purchaser will purchase, by accepting for payment,
and will pay for, all Shares validly tendered on or prior to the Expiration Date
promptly after the Expiration Date. For purposes of the Offer, Purchaser will be
deemed to have accepted for payment, and thereby purchased, tendered Shares if,
as and when Purchaser gives oral or written notice to the Depositary of
Purchaser's acceptance of such Shares for payment. In all cases, payment for
Shares accepted for payment pursuant to the Offer will be made only after timely
receipt by the Depositary of (i) certificates for Shares or timely confirmation
of a book-entry transfer of such Shares, if such procedure is available, into
the Depositary's account at a Book-Entry Transfer Facility (as defined in the
Offer to Purchase) pursuant to the procedures set forth in Section 2 of the
Offer to Purchase, (ii) the Letter of Transmittal (or facsimile thereof),
properly completed and duly executed, or an Agent's Message (as defined in the
Offer to Purchase) and (iii) any other documents required by the Letter of
Transmittal.
Purchaser will not pay any fees or commissions to any broker or dealer or other
person (other than the Depositary and the Information Agent as described in the
Offer to Purchase) in connection with the solicitation of tenders of Shares
pursuant to the Offer. However, Purchaser will upon request, reimburse you for
customary mailing and handling expenses incurred by you in forwarding the
enclosed materials to your clients.
Purchaser will pay or cause to be paid any stock transfer taxes payable on the
transfer of Shares to it, except as otherwise provided in Instruction 6 of the
enclosed Letter of Transmittal.
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY
AS POSSIBLE. THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT MIDNIGHT, NEW YORK
CITY TIME, ON THURSDAY JULY 15, 1999, UNLESS THE OFFER IS EXTENDED.
In order to take advantage of the Offer, a duly executed and properly completed
Letter of Transmittal and any other required documents should be sent to the
Depositary and certificates representing the tendered Shares should be
delivered, or such Shares should be tendered by book-entry transfer, all in
accordance with the instructions set forth in the Letter of Transmittal and the
Offer to Purchase.
If holders of Shares wish to tender, but it is impracticable for them to forward
their certificates or other required documents prior to the expiration of the
Offer, a tender may be effected by following the guaranteed delivery procedures
specified under Section 2 in the Offer to Purchase.
<PAGE>
Any inquiries you may have with respect to the Offer or requests for additional
copies of the enclosed materials should be addressed to the Information Agent at
the address and telephone number set forth on the back cover page of the
enclosed Offer to Purchase.
Very truly yours,
[NAME OF AGENT]
Enclosures
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU OR
ANY PERSON AS AN AGENT OF PURCHASER, THE DEPOSITARY OR THE INFORMATION AGENT OR
AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENTS ON
BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE DOCUMENTS
ENCLOSED AND THE STATEMENTS CONTAINED THEREIN.
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
INCLUDING THE ASSOCIATED RIGHTS TO PURCHASE
SERIES A JUNIOR PARTICIPATING
PREFERRED STOCK
OF
STERIGENICS INTERNATIONAL, INC.
AT
$27.00 NET PER SHARE
BY
IBA ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
ION BEAM APPLICATIONS S.A.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE
AT MIDNIGHT, NEW YORK CITY TIME,
ON THURSDAY JULY 15, 1999, UNLESS THE OFFER IS EXTENDED.
June 17, 1999
To Our Clients:
Enclosed for your consideration is an Offer to Purchase dated June 17, 1999 and
the related Letter of Transmittal (which together constitute the "Offer")
relating to an offer by IBA Acquisition Corp., a Delaware corporation
("Purchaser"), and an indirect wholly owned subsidiary of Ion Beam Applications
s.a., a Belgian corporation ("Parent"), to purchase all outstanding shares of
common stock, par value $.001 per share (the "Shares"), of SteriGenics
International, Inc., a Delaware corporation (the "Company"), at a purchase price
of $27.00 per Share, net to the seller in cash, upon the terms and subject to
the conditions set forth in the Offer. We are the holder of record of Shares
held by us for your account. The Letter of Transmittal is furnished to you for
your information only and cannot be used by you to tender Shares. A tender for
such Shares can be made only by us as the holder of record and pursuant to your
instructions.
We request instructions as to whether you wish to tender any or all of such
Shares held by us for your account, pursuant to the terms and conditions set
forth in the Offer.
Your attention is directed to the following:
1. The tender price is $27.00 per Share, net to the seller in cash.
2. This Offer is being made pursuant to the terms of a Merger Agreement, dated
as of June 10, 1999 (the "Merger Agreement") by and among the Company,
Purchaser, Ion Beam Applications G.P. and Parent. The Merger Agreement
provides, among other things, for the making of the Offer by Purchaser, and
further provides that, following the purchase of Shares pursuant to the
Offer and promptly after the satisfaction or waiver of certain conditions,
the Purchaser will be merged with and into the Company (the "Merger"). The
Company will continue as the surviving corporation after the Merger and will
be an indirect, wholly owned subsidiary of Parent.
3. The Board of Directors of the Company has approved the Offer, the Merger and
the other transactions contemplated by the Merger Agreement, has determined
that the Offer, the Merger and the other transactions contemplated by the
Merger Agreement are fair to and in the best interests of
<PAGE>
the Company's stockholders and recommends that stockholders of the Company
accept the Offer and tender their Shares.
4. The Offer and withdrawal rights will expire at midnight, New York City time,
on Thursday July 15, 1999, unless extended.
5. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THE SATISFACTION OR
WAIVER OF CERTAIN CONDITIONS TO THE OBLIGATIONS OF PURCHASER AND THE COMPANY
TO CONSUMMATE THE OFFER, INCLUDING (1) THERE BEING VALIDLY TENDERED AND NOT
WITHDRAWN PRIOR TO THE EXPIRATION DATE THAT NUMBER OF SHARES OF COMMON
STOCK, TOGETHER WITH THE ASSOCIATED RIGHTS TO PURCHASE SHARES OF SERIES A
JUNIOR PARTICIPATING PREFERRED STOCK, WHICH, WHEN COMBINED WITH THE SHARES
ALREADY OWNED BY PARENT, PURCHASER AND THEIR AFFILIATES, CONSTITUTES A
MAJORITY OF THE TOTAL NUMBER OF OUTSTANDING ON A DILUTED BASIS (INCLUDING
FOR PURPOSES OF SUCH CALCULATION ALL SHARES ISSUABLE UPON EXERCISE OF ALL
VESTED AND UNVESTED STOCK OPTIONS, AND CONVERSION OF CONVERTIBLE SECURITIES
OR OTHER RIGHTS TO PURCHASE OR ACQUIRE SHARES) AND (2) RECEIPT BY PURCHASER
AND THE COMPANY OF CERTAIN GOVERNMENTAL AND REGULATORY APPROVALS.
6. Stockholders who tender Shares will not be obligated to pay brokerage
commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, transfer taxes on the purchase of Shares by Purchaser pursuant
to the Offer.
If you wish to have us tender any or all of your Shares, please complete, sign
and return the form set forth on the reverse side of this letter. Your
instructions to us should be forwarded in ample time to permit us to submit a
tender on your behalf prior to the expiration of the Offer.
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE OFFER
TO PURCHASE FOR CASH ALL OUTSTANDING SHARES OF
COMMON STOCK
INCLUDING THE ASSOCIATED RIGHTS TO PURCHASE SERIES A JUNIOR
PARTICIPATING PREFERRED STOCK
OF
STERIGENICS INTERNATIONAL, INC.
AT
$27.00 NET PER SHARE
BY
IBA ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
ION BEAM APPLICATIONS S.A.
The undersigned acknowledge(s) receipt of your letter enclosing the Offer to
Purchase, dated June 17, 1999, of IBA Acquisition Corp., a Delaware corporation
("Purchaser") and an indirect wholly owned subsidiary of Ion Beam Applications
s.a. and the related Letter of Transmittal, relating to shares of common stock,
par value $.001 per share (the "Shares"), of SteriGenics International, Inc., a
Delaware corporation.
This will instruct you to tender to Purchaser the number of Shares indicated
below held by you for the account of the undersigned, on the terms and subject
to the conditions set forth in the Offer to Purchase and Letter of Transmittal.
- --------------------------------------------------------------------------------
<TABLE>
<S> <C>
NUMBER OF SHARES TO BE TENDERED: SIGN HERE
- ---------------------------------------------SHARES -------------------------------------------------------
-------------------------------------------------------
Signature(s)
-------------------------------------------------------
-------------------------------------------------------
Account Number: -------------------------------------- Please print name(s) and address(es) here
Dated: , 1999
-------------------------------------------------------
Tax Identification or Social Security Number
</TABLE>
- --------------------------------------------------------------------------------
* Unless otherwise indicated, it will be assumed that all of your Shares held
by us for your account are to be tendered.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE PAYER.--
Social Security numbers have nine digits separated by two hyphens: i.e.,
000-00-0000. Employer identification numbers have nine digits separated by only
one hyphen: i.e., 00-0000000. The table below will help determine the number to
give the payer.
<TABLE>
<CAPTION>
- -----------------------------------------------------------
GIVE THE NAME AND
SOCIAL SECURITY
FOR THIS TYPE OF ACCOUNT: NUMBER OF--
- -----------------------------------------------------------
<S> <C> <C>
1. Individual The individual
2. Two or more individuals The actual owner of the
(joint account) account or, if combined
funds, the first
individual on the
account(1)
3. Custodian account of a The minor(2)
minor (Uniform Gift to
Minors Act)
4. a. The usual revocable The grantor-trustee(1)
savings trust (grantor
is also trustee)
b. So-called trust The actual owner(1)
account that is not a
legal or valid trust
under state law
5. Sole proprietorship The owner(3)
- -----------------------------------------------------------
<CAPTION>
GIVE THE NAME AND
EMPLOYER
IDENTIFICATION
FOR THIS TYPE OF ACCOUNT: NUMBER OF--
<S> <C> <C>
- -----------------------------------------------------------
6. A valid trust, estate, The legal entity(4)
or pension trust
7. Corporate The corporation
8. Association, club, The organization
religious, charitable,
educational or other
tax-exempt organization
9. Partnership The partnership
10. A broker or registered The broker or nominee
nominee
11. Account with the The public entity
Department of
Agriculture in the name
of a public entity
(such as a state or
local government,
school district, or
prison) that receives
agricultural program
payments
</TABLE>
- ---------------------------------------------
- ---------------------------------------------
(1) List first and circle the name of the person whose number you furnish. If
only one person on a joint account has a social security number, that
person's number must be furnished.
(2) Circle the minor's name and furnish the minor's social security number.
(3) You must show your individual name, but you may also enter your business or
"doing business as" name. You may use either your social security number or
employer identification number (if you have one).
(4) List first and circle the name of the legal trust, estate, or pension trust.
(Do not furnish the identifying number of the personal representative or
trustee unless the legal entity itself is not designated in the account
title.)
NOTE: If no name is circled when there is more than one name, the number will
be considered to be that of the first name listed.
<PAGE>
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you don't know your
number, obtain Form SS-5, Application for a Social Security Number, or Form
SS-4, Application for an Employer Identification Number, at the local office of
the Social Security Administration or the Internal Revenue Service and apply for
a number. United States resident aliens who cannot obtain a social security
number must apply for an ITIN (Individual Taxpayer Identification Number) on
Form W-7.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on payments of interest,
dividends and with respect to broker transactions include the following:
- A corporation.
- A financial institution.
- An organization exempt from tax under section 501(a), or an individual
retirement plan.
- The United States or any agency or instrumentality thereof.
- A state, the District of Columbia, a possession of the United States, or
any political subdivision or instrumentality thereof.
- A foreign government, or any political subdivision, agency or
instrumentality thereof.
- An international organization or any agency or instrumentality thereof.
- A dealer in securities or commodities required to register in the United
States, the District of Columbia, or a possession of the United States.
- A real estate investment trust.
- A common trust fund operated by a bank under section 584(a).
- An exempt charitable remainder trust, or a non-exempt trust described in
section 4947.
- An entity registered at all times under the Investment Company Act of
1940.
- A foreign central bank of issue.
Payments of dividends and patronage dividends not generally subject to backup
withholding include the following:
- Payments to nonresident aliens subject to withholding under section 1441.
- Payments to partnerships not engaged in a trade or business in the United
States and which have at least one nonresident alien partner.
- Payments of patronage dividends not paid in money.
- Payments made by certain foreign organizations.
- Payments made to a middleman known in the investment community as a
nominee or who is listed in the most recent publication of the American
Society of Corporate Secretaries, Inc., Nominee List.
Payments of interest not generally subject to backup withholding include the
following:
- Payments of interest on obligations issued by individuals. Note: You may
be subject to backup withholding if this interest is $600 or more and is
paid in the course of the payer's trade or business and you have not
provided your correct taxpayer identification number to the payer.
- Payments of tax-exempt interest (including exempt-interest dividends under
section 852).
- Payments described in section 6049(b)(5) to nonresident aliens.
- Payments on tax-free covenant bonds under section 1451.
- Payments made by certain foreign organizations.
- Payments made to a middleman known in the investment community as a
nominee or who is listed in the most recent publication of the American
Society of Corporate Secretaries, Inc., Nominee List.
Exempt payees described above should file Substitute Form W-9 to avoid possible
erroneous backup withholding.
FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER IDENTIFICATION NUMBER,
WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO THE PAYER. IF THE
PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO SIGN AND DATE THE
FORM.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER.--If you fail
to furnish your taxpayer identification number to a payer, you are subject to a
penalty of $50 for each such failure unless your failure is due to reasonable
cause and not to willful neglect.
(2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING.--If you
make a false statement with no reasonable basis which results in no imposition
of backup withholding, you are subject to a penalty of $500.
(3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION.--Willfully falsifying
certifications or affirmations may subject you to criminal penalties including
fines and/or imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE
SERVICE
<PAGE>
Exhibit 99(a)(7)
- --------------------------------------------------------------------------------
This announcement is neither an offer to purchase nor a solicitation of an offer
to sell Shares (as defined below). The Offer (as defined below) is made solely
by the Offer to Purchase dated June 17, 1999 and the related Letter of
Transmittal, and is being made to all holders of Shares. The Offer
is not being made to (nor will tenders be accepted from or on
behalf of) holders of Shares in any jurisdiction in which
the making of this Offer or the acceptance thereof would
not be in compliance with the laws of such jurisdiction
or any administrative or judicial action pursuant thereto.
In any jurisdiction where securities, blue sky or other
laws require the Offer to be made by a licensed broker
or dealer, the Offer shall be deemed to be made on
behalf of the Purchaser by Bear, Stearns & Co. Inc.,
as Dealer Manager or one or more registered brokers
or dealers licensed under the laws of such
jurisdiction.
NOTICE OF OFFER TO PURCHASE FOR CASH
ALL OF THE OUTSTANDING SHARES OF COMMON STOCK
(Including the Associated Rights to Purchase Series A Junior
Participating Preferred Stock)
OF
STERIGENICS INTERNATIONAL, INC.
AT
U.S. $27.00 NET PER SHARE
BY
IBA ACQUISITION CORP.,
AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF
ION BEAM APPLICATIONS S.A.
IBA Acquisition Corp., a Delaware corporation ("Purchaser") and an indirect
wholly-owned subsidiary of Ion Beam Applications s.a., a Belgian corporation
("Parent"), is offering to purchase all of the outstanding shares of Common
Stock, par value $.001 per share (the "Common Stock"), together with the
associated rights to purchase shares of Series A Junior Participating Preferred
Stock, par value $.001 per share (the "Rights" and together with the Common
Stock, the "Shares"), of SteriGenics International, Inc., a Delaware corporation
(the "Company"), at a price of U.S. $27.00 per Share, net to the seller in cash,
without interest thereon, upon the terms and subject to the conditions set forth
in the Offer to Purchase dated June 17, 1999 (the "Offer to Purchase"), and the
related Letter of Transmittal (which, together with any amendments or
supplements thereto, collectively constitute the "Offer"). Following the Offer,
Purchaser intends to effect the Merger (as defined and described below).
- --------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW
YORK CITY TIME, ON THURSDAY JULY 15, 1999, UNLESS THE OFFER IS EXTENDED
- --------------------------------------------------------------------------------
This Offer is conditioned upon, among other things, (i) there being validly
tendered and not withdrawn prior to the Expiration Date (as defined below), a
number of Shares which, together with the Shares owned by Parent, Purchaser or
any of their affiliates, represent at least a majority of the then-outstanding
Shares on a diluted basis (including for pur- poses of such calculations herein
all Shares issuable upon exercise of all vested and unvested stock options, and
conver- sion of convertible securities or other rights to purchase or acquire
Shares) (the "Minimum Condition"), (ii) the receipt of all necessary regulatory
approvals, and (iii) the satisfaction of certain other terms and conditions
described in Section 15 of the Offer to Purchase. Purchaser expressly reserves
the right (with the consent of the Company) to waive the Minimum Condition and
to purchase any Shares validly tendered (and not validly withdrawn) pursuant to
the Offer. The Offer is not subject to a financing condition.
The Offer is being made pursuant to a Merger Agreement, dated as of June
10, 1999 (the "Merger Agreement"), by and among Parent, Purchaser, Ion Beam
Applications G.P., a Delaware general partnership which owns all of the
outstanding capital stock of Purchaser and of which Parent is the controlling
general partner, and the Company. The Merger Agreement provides that, as soon as
practicable after the completion of the Offer and satisfaction or waiver, if
permissible, of all con- ditions contained in the Merger Agreement, and in
accordance with the General Corporation Law of the State of Delaware (the
"DGCL"), Purchaser will be merged with and into the Company (the "Merger").
Following the consummation of the Merger, the Company will continue as the
surviving corporation and will be an indirect wholly-owned subsidiary of Parent.
At the effective time of the Merger (the "Effective Time"), each Share then
outstanding (other than Shares held by the Company, Parent or any of their
respective subsidiaries, including Purchaser and stockholders who properly
perfect their dissenters' rights under the DGCL) will be converted into the
right to receive $27.00 in cash without interest thereon.
In connection with the execution of the Merger Agreement, Parent and
certain stockholders (the "Principal Stockholders") of the Company have entered
into a Stockholders' Agreement, dated as of June 10, 1999 (the "Stockholders'
Agreement"), pursuant to which the Principal Stockholders have, among other
things, agreed to tender in the Offer upon the terms and subject to the
conditions of the Stockholders' Agreement, all the Shares owned by the Principal
Stockholders. These shares represent approximately 27.15% of the outstanding
Shares of the Company (calculated on a diluted basis). Parent currently owns
751,300 Shares, or approximately 8.18% of the outstanding Shares of the Company
(calculated on a diluted basis).
The Board of Directors of the Company has approved the Merger Agreement and
the transactions contemplated thereby, including the Offer and the Merger, and
has determined that the Offer and the Merger are fair to, and in the best
interests of, the Company's stockholders and recommends that its stockholders
accept the Offer and tender their Shares pursuant to the Offer.
For purposes of the Offer, Purchaser will be deemed to have accepted for
payment, and thereby to have purchased, Shares properly tendered to Purchaser
and not withdrawn if, as and when Purchaser gives oral or written notice to IBJ
Whitehall Bank and Trust Company (the "Depositary") of its acceptance for
payment of such Shares. Upon the terms and subject to the conditions of the
Offer, payment for Shares accepted for payment pursuant to the Offer will be
made by deposit of the purchase price therefor with the Depositary, which will
act as agent for tendering stockholders for the purpose of receiv- ing payment
from Purchaser and transmitting payment to tendering stockholders. In all cases,
payment for Shares accepted for payment pursuant to the Offer will be made only
after timely receipt by the Depositary of (i) certificates for such Shares (or a
confirmation of a book-entry transfer of such Shares into the Depositary's
account at the Book-Entry Transfer Facility (as defined in the Offer to
Purchase)), (ii) a Letter of Transmittal (or facsimile thereof), properly
completed and duly executed, with any required signature guarantees, or, in the
case of a book-entry transfer, an Agent's Message (as defined in the Offer to
Purchase), and (iii) any other documents required by the Letter of Transmittal.
Under no circumstances will interest be paid on the purchase price to be paid by
Purchaser for such Shares, regardless of any extension of the Offer or any delay
in making such payment.
The term "Expiration Date" shall mean 12:00 Midnight, New York City time,
on Thursday, July 15, 1999, unless and until Purchaser (in accordance with the
terms of the Merger Agreement) shall have extended the period of time during
which the Offer is open, in which event the term "Expiration Date" shall mean
the latest time and date at which the Offer, as so extended by Purchaser, shall
expire. Subject to the applicable rules and regulations of the Securities and
Exchange Commission and to applicable law, Purchaser expressly reserves the
right, subject to the Merger Agreement, at any time and from time to time, to
extend for any reason the period of time during which the Offer is open by
giving written notice of such extension to the Depositary. Any such extension
will be followed by a public announcement thereof by no later than 9:00 a.m.,
New York City time, on the next business day after the previously scheduled
Expiration Date. During any such extension, all Shares previously tendered and
not withdrawn will remain subject to the Offer, subject to the right of a
tendering stockholder to withdraw such stockholder's Shares. Without limiting
the manner in which Purchaser may choose to make any public announcement,
Purchaser will have no obligation to publish, advertise or otherwise communicate
any such announcement other than by issuing a press release to the Dow Jones
News Service or otherwise as may be required by applicable law.
Except as otherwise provided below, tenders of Shares made pursuant to the
Offer are irrevocable. Shares tendered pur- suant to the Offer may be withdrawn
at any time prior to the Expiration Date and, unless theretofore taken up and
paid for by the Purchaser prior to the receipt by the Depositary of a notice of
withdrawal in respect of the Shares, may also be withdrawn at any time after
August 15, 1999, or such later time as may apply if the Offer is extended or
varied, in each case in accordance with Section 3 of the Offer to Purchase. For
a withdrawal to be effective, a written, telegraphic or fac- simile transmission
of the notice of withdrawal must be timely received by the Depositary in
accordance with Section 3 of the Offer to Purchase. Any such notice of
withdrawal must specify the name of the person having tendered the Shares to be
withdrawn, the number of Shares to be withdrawn and the name of the registered
holder of the Shares to be withdrawn. If certificates evidencing such Shares to
be withdrawn have been delivered or otherwise identified to the Depositary,
then, prior to the physical release of such certificates, the serial numbers
shown on such certificates must be submitted to the Depositary and, unless such
Shares have been tendered for the account of an Eligible Institution (as defined
in the Offer to Purchase), the signatures on the notice of withdrawal must be
guaranteed by an Eligible Institution. If Shares have been delivered pursuant to
the procedures for book-entry transfer set forth in Section 2 of the Offer to
Purchase, any notice of withdrawal must also specify the name and number of the
account at the Book-Entry Transfer Facility to be credited with the withdrawn
Shares and otherwise comply with the Book-Entry Transfer Facility's procedures.
Withdrawals of tenders of Shares may not be rescinded, and any Shares properly
withdrawn will thereafter be deemed not validly tendered for pur- poses of the
Offer. However, withdrawn Shares may be retendered by again following one of the
procedures described in Section 2 of the Offer to Purchase at any time at or
prior to the Expiration Date. All questions as to the form and validity
(including time of receipt) of notices of withdrawal will be determined by
Purchaser, in its sole discretion, whose determination will be final and
binding.
The information required to be disclosed by paragraph (e)(1)(vii) of Rule
14d-6 of the General Rules and Regulations under the Securities Exchange Act of
1934, as amended, is contained in the Offer to Purchase and is incorporated
herein by reference.
The Company has provided Purchaser with the Company's stockholder lists and
security position listings for the pur- pose of disseminating the Offer to
holders of Shares. The Offer to Purchase and the related Letter of Transmittal
and other relevant documents will be mailed to record holders of Shares whose
names appear on the stockholder lists, and will be furnished to brokers,
dealers, commercial banks, trust companies and similar persons whose names, or
the names of whose nominees, appear on the Company's stockholder list, or, if
applicable, who are listed as participants in any clearing agency's security
position listing obtained by the Purchaser, for subsequent transmittal to
beneficial owners of Shares.
The Offer to Purchase and the related Letter of Transmittal contain
important information and should be read care- fully before any decision is made
with respect to the Offer.
Questions and requests for assistance or additional copies of the Offer to
Purchase, the Letter of Transmittal and other tender offer materials may be
directed to the Information Agent or the Dealer Manager (each as defined in the
Offer to Purchase) at their respective addresses and telephone numbers set forth
below, and copies will be furnished promptly at Purchaser's expense. Neither
Parent nor Purchaser will pay any fees or commissions to any broker or dealer or
other person (other than the Dealer Manager and the Information Agent) for
soliciting tenders of Shares pursuant to the Offer.
THE INFORMATION AGENT FOR THE OFFER IS:
[LOGO OF MACKENZIE PARTNERS, INC.]
156 Fifth Avenue
New York, New York 10010
(212) 929-5500 (Call Collect)
or
CALL TOLL-FREE: (800) 322-2885
THE DEALER MANAGER FOR THE OFFER IS:
BEAR, STEARNS & CO. INC.
245 Park Avenue
New York, New York 10167
CALL TOLL-FREE: (888) 293-1889
June 17,1999
- --------------------------------------------------------------------------------
<PAGE>
TRANSLATION
ION BEAM APPLICATIONS SA
PRESS RELEASE
MAJOR NEW ACQUISITION FOR
IBA IN THE US STERILIZATION MARKET
Louvain-la-Neuve, 11 June 1999
Ion Beam Applications s.a. (IBA), has just concluded an agreement to acquire
SteriGenics International, Inc. (NASDAQ: STER).
SteriGenics, which is based in Fremont, California, has developed a position
of leadership in the area of sterilization services of medical devices and food
products and for polymer modification by using gamma radiation. The acquisition
cost is approximately US$214 million. Under the terms of the agreement, the
shareholders of SteriGenics will receive US$27 per share in cash. IBA expects to
commence a tender offer within the next 5 business days. The Boards of Directors
of both companies have approved the transaction.
IBA, which first developed as an equipment manufacturer, made its entry in
the services industry through the acquisition in May 1999 of Griffith Micro
Sciences, a leader in Eto (Ethylene oxide) sterilization services, and is
present in almost a dozen countries, and whose HQ is in Chicago.
The acquisition of SteriGenics will allow IBA further to expand the range of
technologies it offers its customers. According to Pierre Mottet, CEO of IBA:
"The acquisition of SteriGenics will allow us to offer our customers the
complete choice of technology which they need, including Eto, electron beam,
X-ray and Gamma. It will also allow us to open the door of new markets and new
clients". James F. Clouser, CEO of SteriGenics, added: "The combination of IBA
and SteriGenics will contribute efficiently to the increasing demands of our
customers for 'one-stop shopping' for the medical device sterilization, food
pasteurization and polymer modification industries".
The closing of the offer is expected to occur in July 1999, subject to
necessary applicable regulatory approvals. This acquisition fits particularly
well with IBA's growth strategy by expanding its range of technologies in order
to cover more applications in the markets where it is active.
IBA is principally active in 4 areas: cancer radio-therapy, the production
of radio-isotopes for medical imagery, sterilization of medical devices and food
products and the improvement of materials through radiation. With this
acquisition, the group should comprise 1,100 people and should have a turnover
of more than 150 million in 1999.
SteriGenics, which is located at 15 sites in the USA, had a turnover, in its
last financial year which ended 31 March 1999, of US$55 million and a net
profit, after tax, of US$7.8 million.
You can find further information on IBA at "www.IBA.be" and on SteriGenics
at "www.sterigenics.com".
For more information contact:
Eric de Lamotte
Chief Financial Officer
IBA
Tel: +32 10 475 807
E-mail: [email protected]
<PAGE>
BANK BRUSSELS LAMBERT S.A.
CORPORATE BANKING
AVENUE MARNIX 24
B-1000 BRUSSELS
BELGIUM
June 10, 1999
Mr. Eric de Lamotte
Chief Financial Officer
Ion Beam Applications S.A.
Chemin du Cyclotron 3
B-1348 Louvain-la-Neuve
Belgium
RE: Acquisition Financing
Dear Eric:
You have advised us that Ion Beam Applications s.a. (the "Parent") intends
to form IBA Acquisition Corp. (the "Acquisition Company") which will (i) acquire
(the "Acquisition") outstanding common stock of SteriGenics International Inc.
(the "Target") pursuant to a tender offer (the "Tender Offer") and (ii)
following the consummation of the Tender Offer, merge itself into the Target,
with the Target being the surviving entity (the "Merger"). The Acquisition
Company will be the wholly-owned subsidiary of Ion Beam Applications GP, a
Delaware general partnership, (the "GP"), which is controlled by the Parent. The
Tender Offer, the Acquisition, and the Merger in connection therewith are
collectively referred to herein as the "Transaction".
You have advised us that up to US $220 million of a senior tender offer
facility will be required to finance the Tender Offer.
In connection with the foregoing, Bank Brussels Lambert S.A. ("BBL") is
pleased to confirm that it will provide to Parent a tender offer facility for
borrowings of up to US $220 million, which may be drawn upon by Borrower at any
time from the date of this letter to December 31, 1999. The loan advanced under
such facility shall be due and payable at the latest in full on the date falling
six months from the date of borrowing. The loan shall bear interest, payable
monthly, at a rate equal to one month LIBOR plus [1.00%]per annum, and the loan
shall be prepayable in whole or in part on any monthly interest payment date
without penalty. Other provisions of the tender offer facility will be customary
for this type of loan facility.
Very truly yours,
BANK BRUSSELS LAMBERT S.A
By: /s/ PHILLIPPE HUSTINX
---------------------------------------
Name: Phillippe Hustinx
Title: Area Manager
/s/ YVES ADLER
Yves Adler
SENIOR MANAGER
CORPORATE BANKING
<PAGE>
TRANSLATION
Ion Beam Applications
F.A.O. Mr. Eric de Lamotte
Chief Financial Officer
Chemin du Cyclotron, 3
B-1348 Louvain-la-Neuve
BBL
Banque Brussels Lambert
Corporate Banking
Avenue Marnix 24
B-1000 Brussels
Your contact: Philippe Hustinx
Tel: 02/47 26 50--Fax: 02/547 31 19
Brussels, June 14, 1999
Our ref: PH99-140602
Dear Eric,
We refer to our various recent telephone discussions regarding the financing
of the public tender offer which IBA, through one of its subsidiaries, wishes to
make for the shares of SteriGenics International Inc., USA, at US$ 27 per share.
Further to your request, we confirm that our bank is prepared:
1. to issue to the order and on behalf of IBA s.a., a "commitment letter"
for the sum of US$ 220 million, maximum amount, upon signature of this
letter and the documents attached hereto, by which BBL certifies that IBA
has the financial means to carry through its public tender offer for
SteriGenics, up to the amount referred to above, namely be means of a
credit facility for the same sum on which IBA may draw on our bank up to
December 31, 1999. The commission relating to this commitment shall be
calculated by our bank at a flat 0.10% payable in advance And deducted
each quarter.
2. to make available to IBA SA a credit facility called a bridge loan of a
maximum of US$ 220 million usable only for the acquisition of SteriGenics
shares and after obtaining the agreement of the American anti-trust
authorities for this public tender offer. This facility shall have a
maximum duration of 6 months as from the first drawdown. Drawings shall
only be authorized up to December 31, 1999 and reimbursement shall be
made at the latest on June 30, 2000. The commission, that will be
deducted for the setting up of this bridge loan is a flat fee of
US$300,000 and the margin applied on the advances to be made, at 1% p.a.
applied at the Libor rate relating to each drawing.
CONDITIONS FOR ESTABLISHING THE ABOVE-MENTIONED COMMITMENTS
- pledge, in proper and due form, with BBL, of the 751,300 shares in
SteriGenics International Inc., held by IBA, to the order of BBL and upon
any use of the bridge loan, pledge of all the shares which will be
acquired by IBA SA or its subsidiaries:
- commitment of IBA SA to limit its public tender offer for SteriGenics
International Inc., to US$ 27 per share;
<PAGE>
- irrevocable grant of "right of first refusal" given by IBA SA to BBL to
"arrange" the refinancing in the medium/long term for the reimbursement of
the bridge loan by means of the establishment of a "revolving" credit
and/or a "term loan" in a club deal with the participation of banks chosen
by common agreement between IBA and BBL and/or by means of an issue of
[debt].
Please find attached the security agreements referred to above, which we
would request you have accepted by the persons who can commit the company in
this matter, as well as this letter.
Yours sincerely,
<TABLE>
<S> <C>
/s/ PHILIPPE HUSTINX /s/ YVES ADLER
- ------------------------------------------- -------------------------------------------
Philippe Hustinx Yves Adler
Senior Manager Deputy General Manager
/s/ ERIC DE LAMOTTE
- -------------------------------------------
Eric de Lamotte
Yves Jongen
</TABLE>
<PAGE>
COMMERCIAL PLEDGE
(DEPOSITS ON A BBL ACCOUNT)
<TABLE>
<S> <C>
- ------------------- PLEDGER: Ion Beam Application (IBA) located at 3, Chemin du
Fiscal Cyclotron 3, B-1348 Louvain-la-Neuve.
Stamp
---------------
PLEDGE: BBL S.A., Registered Office located 24, Avenue Marnix,
B-1000 Brussels, Brussels Trade Register No. 77,186, V.A.T.
BE 403.200.393
</TABLE>
1. We hereby declare that we pledge in favour of BBL any claims we hold or
will hold against BBL as a result of the cash deposits in Belgian francs, Euro
or foreign currencies, made and/or to be made on one or several subheadings of
our account no. 310-0663100-94.
We confirm that the pledged claims have not been the object of any transfer,
pledge, seizure or opposition.
2. This pledge will secure the payment and/or reimbursement of all sums in
the principal, interest, commissions and incidentals which we may owe BBL
(either together or separately), alone or with others, jointly and severally or
not, for whatever reason, as part of our business relationship with the BBL.
The payment of all commercial documents, including but not limited to trade
paper, that BBL will hold and that is bearing our signature, in whatever
capacity, is included in the above mentioned sums.
3. Consequently, for the entire duration of this pledge, we hereby
undertake not to dispose of the claims and deposits referred to above without
the express consent of BBL. No consent that BBL may give for the partial or
total withdrawal or transfer of the deposits pledged may any way be construed as
a waiver to this pledge, which will remain in force and apply with full effects
in respect of claims resulting from existing or future deposits on the pledge
account.
4. Neither transferring funds from a current to a term subheading of the
account, nor modifying, extending or canceling a term whereby the account
becomes a sight account, nor any change to the currency will in any way effect
the continuity and validity of the pledge.
5. It is stipulated--as far as necessary--that, in derogation of the
provisions governing the unicity of the account provided by BBL's General
Regulations and General Regulations for Credits, the aforementioned pledged
account will be completely distinct from our account(s) maintained with BBL.
6. We hereby authorize BBL to collect at any time for the sight deposits
and on each maturity date for the term deposits the sums in principal and/or
interest, which it owes or will owe us following the deposits made under this
pledge. Where appropriate and after conversion into BEF these sums will be, at
the discretion of BBL, set against any sums secured which have become
immediately payable or, if no such sums are due immediately, BBL will keep them
in order to debit all amounts required as and when secured commitments become
due; BBL will refund to us an amount equivalent to the sums which have not been
used as soon as there are no longer obligations guaranteed by this pledge.
7. Either: Unless BBL uses its right to collect the interest accrued on
the deposits pledged, the interest will be credited to our
current account, without prejudice to the validity or article 3
above.
Or: Unless BBL uses its right to collect the interest accrued on the
deposits pledged, the interest will be credited to a sight
subheading or, provided both parties agree thereto, to a term
subheading of the pledged account, in which case the interest will
then become part of the deposits pledged.
8. This pledge is governed by Belgian law, and only the Courts of Brussels
shall be competent.
9. Any costs resulting from this deed or its execution will be borne by us
and covered by the pledge.
10. For the execution hereof, we elect domicile in Brussels
<PAGE>
Signed in Brussels on June 14(th) 1999
For Ion Beam applications S.A.
/s/ Belgabeam
By: Eric de LaMotte
/s/ Yves Jungen
For acknowledgement by BBL S.A.
<PAGE>
COMMERCIAL PLEDGE
(DEPOSITS ON A BBL ACCOUNT)
<TABLE>
<S> <C>
- ------------------- PLEDGER: Ion Beam Application General Partnership, 3 Rue du
Fiscal Cyclotron, B-1348 Louvain-la-Neuve
Stamp
---------------
PLEDGEE: BBL S.A., Registered Office located at 24, Avenue Marnix,
B-1000 Brussels, Brussels Trada Register No. 771.1866, V.A.T.
BE 403.200.393
</TABLE>
1. We hereby declare that we pledge in favour of BBL any claims we hold or
will hold against BBL as a result of the cash deposits in Belgian francs, Euro
or foreign currencies, made and/or to be made on one or several subheadings of
our account no. 310-1294987-26.
We confirm that the pledged claims have not been the object of any transfer,
pledge, seizure or opposition
2. This pledge will secure the payment and/or reimbursement of all sums in
principal, interest, commissions and incidentals which we may owe BBL (either
together or separately), alone or with others, jointly and severally or not, for
whatever reason, as part of our business relationship with the BBL.
The payment of all commercial documents, including but not limited to trade
paper, that BBL will hold and that is bearing our signature, whatever capacity,
is included in the above mentioned sums.
3. Consequently, for the entire duration of this pledge, we hereby
undertake not to dispose of the claims and deposits referred to above without
the express consent of BBL. No consent that BBL may give for the partial or
total withdrawal or transfer of the deposits pledged may in any way construed as
waiver to this pledge, which will remain in force and apply with full effects in
respect of claims resulting from existing or future deposits on the pledge
account.
4. Neither transferring funds from a current to a term subheading of the
account, nor modifying, extending or cancelling a term whereby the account
becomes a sight account, nor any change to the currency will in any way effect
the continuity and validity of the pledge.
5. It is stipulated--as far as necessary--that, in derogation of the
provisions governing the unicity of the account provided by BBL's General
Regulations and General Regulations for Credits, the aforementioned pledged
account will be completely distinct from our other account(s) maintained with
BBL.
6. We hereby authorise BBL to collect at any time for the sight deposits
and on each maturity date for the term deposits the sums in principal and/or
interest, which it owes or will owe us following the deposits made under this
pledge. Where appropriate and after conversion into BEF these sums will be, at
the discretion of BBL, set against any sums secured which have become
immediately payable or, if no such sums are due immediately, BBL will keep them
in order to debit all amounts required as and when secured commitments become
due; BBL will refund to us an amount equivalent to the sums which have not been
used as soon as there are no longer obligations guaranteed by this pledge.
7. Either: Unless BBL uses its right to collect the interest accrued on
the deposits pledged, the interest will be credited to our
current account, without prejudice to the validity or article 3
above.
Or: Unless BBL uses its right to collect the interest accrued on the
deposits pledged, the interest will be credited to a sight
subheading, or, provided both parties agree thereto, to a term
subheading of the pledged account, in which case the interest
will then become part of the deposits pledged.
8. This pledge is governed by Belgian law, and only the Courts of Brussels
shall be competent.
9. Any costs resulting from this deed or its execution will be borne by us
and covered by the pledge.
<PAGE>
10. For the execution hereof, we elect domicile in Brussels.
Signed in Brussels on June 14(th) 1999
For Ion Beam applications S.A.
/s/ Belgabeam
By: Eric de LaMotte
/s/ Yves Jongen
For acknowledgement by BBL S.A.
<PAGE>
COLLATERAL PLEDGE AGREEMENT
I. As security for the payment of (i) any indebtedness or any renewal or
extension thereof and (ii) any and all other obligations and/or liabilities,
direct or contingent, of the undersigned to the Bank, due or to become due,
whether now existing or hereafter arising (any indebtedness or other obligations
and liabilities being hereinafter referred to as the "Obligations"), the
undersigned hereby pledges to the Bank
7,995,000 SteriGenics International Inc
REF. 184069.60.0
and all property and the proceeds thereof now or at any time(s) hereafter (a) in
the possession or control of the undersigned at any time(s) by any third party
as agent, pledgeholder or otherwise for the Bank or any such third party for the
express purpose of being used by Bank as collateral security, or for
safekeeping, or for any other or different purpose, and (b) in transit to or
from the Bank or to the undersigned-and hereby gives the Bank a lien upon and a
security interest in all the property as aforesaid for the amount(s) owing at
any time(s) on the Obligations. The Bank may, at its option and at any time(s),
with or without notice to the undersigned, appropriate and apply to the payment
or reduction, either in whole or in part, of the amount owing on all or any of
the Obligations (whether or not then due) any and all moneys now or hereafter
with the Bank, on deposit or otherwise, to the credit of or belonging to the
undersigned. The Bank shall not be obligated to assert or enforce any rights,
liens or security interests hereunder or to take any action in reference
thereto, and the Bank may in its discretion at any time(s) relinquish its rights
hereunder as to particular property without thereby affecting or invalidating
its rights hereunder as to all or any other property as to which this reference
has hereinbefore been made.
II. Furthermore, the undersigned agrees: (a) that, in event of any new or
additional certificate(s) of stock being issued (as stock dividends or
otherwise) relative to any stock held by the Bank at the time as security
hereunder, such certificate(s) shall be deemed an increment to the stock so held
and under pledge to the Bank and that, therefore, such certificate(s) will--to
the extent received by or placed under the control of the undersigned-be held or
controlled in trust for the bank and will be promptly delivered to the Bank (in
for transfer) to be held hereunder; (b) that, should the aggregate market value
of all property held as security hereunder at any time suffer any decline or
should any such property be deemed by the Bank to be unsatisfactory or
inadequate, or should any such property fail to conform to legal requirements,
the undersigned will upon request deliver to the Bank additional collateral or
will make one or more payments on account, to the satisfaction of the Bank; (c)
that the Bank shall exercise reasonable care in the custody of any property upon
or in which a lien and security interest has been created hereunder at the
time(s), but shall be deemed to have exercised reasonable care if such property
is accorded treatment substantially equal to that which the Bank accords its own
property, or if the Bank takes such action with respect to the property as the
undersigned shall reasonably request in writing, but no failure to comply with
any such request nor any omission to do any such act requested by the
undersigned shall be deemed a failure to exercise reasonable care, nor shall any
failure of the Bank to take necessary steps to preserve rights against any
parties with respect to any property in its possession be deemed a failure to
exercise reasonable care, and (d) that the Bank may, in its discretion and in
the absence of other express instruction in writing, apply any amount(s), which
maybe paid to and/or received or held by it relative hereto at any time(s), to
the payment or reduction, either in whole or in part, of the principal and/or
interest (as the Bank may elect) then owing on all or any of the Obligations.
III. In the event of the happening of any one or more of the following
events, anyone of which shall constitute an event of default, to wit: (a) the
non-payment of any of the Obligations; (b) the failure of the undersigned
forthwith, with or without notice, to furnish satisfactory additional
collateral, or to make payments on account, as hereinbefore agreed; (c) the
death, failure in business, dissolution or termination of existence of the
undersigned; (d) any petition in bankruptcy being filed by or against the
undersigned or any endorser or guarantor of any note, or any proceedings in
bankruptcy, or under any laws relating to the relief of debtors, being commenced
for the relief or readjustment of any indebtedness of the undersigned or any
endorser or guarantor of any note, either through reorganization, composition,
extension or otherwise; (e) the making by the undersigned or any endorser or
guarantor of any note of an assignment for the benefit of creditors or the
taking advantage by any of the same of any insolvency law; (f) any
<PAGE>
seizure, vesting or intervention by or under authority of a government, by which
the management of the undersigned or any endorser or guarantor of any note is
displaced or its authority in the conduct of its business is curtailed; (g) the
appointment of a receiver of any property of the undersigned or any endorser or
guarantor of any note; (h) the attachment or distraint of any funds or other
property of the undersigned which may be in, or come into, the possession or
control of the Bank, or of any third party acting for the Bank as aforesaid, or
of the same becoming subject at any time to any mandatory order of court or
other legal process-then, or at anytime after the happening of any such event of
default, any note(s) or other obligations(s) which may be taken in renewal or
extension of all or any part of the indebtedness evidenced thereby, shall
immediately become due and payable, without demand or notice, and likewise upon
the happening of any such event of default, or at any time thereafter, any or
all of the other Obligations then existing, shall, at the option of the Bank,
become due and payable forthwith, without demand upon or notice to the
undersigned. Furthermore, upon the occurrence of any such event of default the
Bank shall have all of the rights and remedies provided to a secured party at
that time and, in addition thereto, the undersigned further agrees that (1) in
the event that notice is necessary, written notice mailed to the undersigned at
the address given below three business days prior to the date of public sale of
the property subject to the lien and security interest created herein or prior
to the date after which private sale or any other disposition of said property
will be made shall constitute reasonable notice, but notice given in any other
reasonable manner or at any other reasonable time shall be sufficient, (2) in
the event of sale or other disposition of such property, the Bank may apply the
proceeds of any such sale or disposition to the satisfaction of its reasonable
attorneys' fees, legal expenses and other costs and expenses incurred in
connection with its retaking, holding, preparing for sale, and selling of the
property, and (3) without precluding any other methods of sale, the sale of
property shall have been made in a commercially reasonable manner if conducted
in conformity with reasonable commercial practices of banks disposing of similar
property, but in any event the Bank may sell on such terms as it may choose,
without assuming any credit risk and without any obligation to advertise.
IV. The word "property" as used herein includes goods and merchandise
together with the proceeds thereof, as well as any and all documents relative
thereto; also funds, cash credit balances, securities, choses in action and any
and all other forms of property together with the proceeds thereof, whether
real, personal or mixed, and any right, title or interest of the undersigned
therein or thereto.
V. The Bank is hereby authorized, at its option and without any obligation
to do so, to transfer to or register in the name of its nominee(s) all or any
part of the property referred to hereinabove, and to do so before or after the
maturity of any of the Obligations, and with or without notice to the
undersigned.
VI. The Bank may transfer any note and deliver to the transferee(s) all or
any of the property then held by it as security hereunder, and the transferee(s)
shall thereupon become vested with all the powers and rights herein given to the
Bank with respect thereto; and the Bank shall thereafter be forever relieved and
fully discharged from any liability or responsibility in the matter, but the
Bank shall retain all rights and powers hereby given with respect to property
not so transferred.
VII. The word "undersigned" wherever used herein shall be construed to refer
separately to each of us and collectively to any two or more of us, and any note
executed by us shall not be revoked or impaired as to any one or more of us by
the revocation or release of any obligations hereunder of any other(s) of us.
VIII. The undersigned hereby waives presentment for payment, demand, notice
of dishonor and protest of any note which it shall execute and further agrees
that such note shall be deemed to have been made under and shall be governed by
the laws of the Kingdom of Belgium in all respects, including matters of
construction, validity and performance, and that none of its terms or provisions
may be waived, altered, modified or amended except as the Bank may consent
thereto in writing duly signed for and on its behalf.
<PAGE>
IX. The Bank is authorized, at its option, to file any documents required by
law without the signature of the undersigned with respect to any of the above
described property; the undersigned agrees to pay the cost of any such filing,
and to sign upon request any instruments, documents or other papers which the
Bank may require to perfect its security interest in the property.
X. This pledge is governed by the laws of the State of New York.
Signature: /s/ Belgabeam
Address:
------------------------------------------------------------------------------
Signature: /s/ Yves Jongen
Address:
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<PAGE>
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MERGER AGREEMENT
DATED AS OF JUNE 10, 1999
AMONG
ION BEAM APPLICATIONS S.A.
ION BEAM APPLICATIONS G.P.
IBA ACQUISITION CORP.
AND
STERIGENICS INTERNATIONAL, INC.
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TABLE OF CONTENTS
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ARTICLE 1 THE OFFER 6
SECTION 1.1. The Offer 6
SECTION 1.2. Company Action 7
SECTION 1.3. Boards of Directors and Committees; Section 14(f) 8
ARTICLE 2 THE MERGER 9
SECTION 2.1. The Merger 9
SECTION 2.2. Closing of the Merger 9
SECTION 2.3. Effective Time 9
SECTION 2.4. Effects of the Merger 9
SECTION 2.5. Charter and Bylaws 10
SECTION 2.6. Directors 10
SECTION 2.7. Officers 10
SECTION 2.8. Conversion of Shares 10
SECTION 2.9. Payment of Cash Merger Consideration 10
SECTION 2.10. Stock Options; Purchase Plan 11
ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE COMPANY 12
SECTION 3.1. Organization and Qualification; Subsidiaries 12
SECTION 3.2. Capitalization of the Company and its Subsidiaries 12
SECTION 3.3. Authority Relative to this Agreement; Recommendation 13
SECTION 3.4. SEC Reports; Financial Statements 13
SECTION 3.5. Information Supplied 14
SECTION 3.6. Consents and Approvals; No Violations 14
SECTION 3.7. Compliance with Applicable Law 15
SECTION 3.8. No Undisclosed Liabilities; Absence of Changes 15
SECTION 3.9. Litigation 16
SECTION 3.10. Year 2000 Compliance 16
SECTION 3.11. Employee Benefit Plans, Labor Matters 16
SECTION 3.12. Environmental Laws and Regulations 17
SECTION 3.13. Taxes 17
SECTION 3.14. Properties 19
SECTION 3.15. Material Contracts and Commitments 19
SECTION 3.16. Intangible Property 20
SECTION 3.17. Brokers 21
SECTION 3.18 Certain Business Practices 21
SECTION 3.19. Applicability of State Takeover Statutes 21
SECTION 3.20 Amendment to the Rights Agreement 21
SECTION 3.21 Opinion of Financial Advisor 21
SECTION 3.22 Employees 21
ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF PARENT AND ACQUISITION 22
SECTION 4.1. Organization 22
SECTION 4.2. Authority Relative to this Agreement 22
SECTION 4.3. Information Supplied 22
SECTION 4.4. Financing 22
SECTION 4.5. Consents and Approvals; No Violations 23
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ARTICLE 5 COVENANT 23
SECTION 5.1. Interim Operations 23
SECTION 5.2. Stockholders' Meeting 25
SECTION 5.3. Other Potential Acquirers 25
SECTION 5.4. Intentionally Omitted 26
SECTION 5.5. Access to Information 26
SECTION 5.6. Further Actions 27
SECTION 5.7. HSR Matters 28
SECTION 5.8. Public Announcements 28
SECTION 5.9. Employee Benefit Matters; Company Stock Option 28
SECTION 5.10. Notification of Certain Matters 28
SECTION 5.11. Guarantee of Performance 28
SECTION 5.12. Indemnification, Directors' and Officers' Insurance 28
SECTION 5.13. State Takeover Laws 29
SECTION 5.14. Employee Benefits 29
ARTICLE 6 DISSENTING SHARES; EXCHANGE OF SHARES 29
SECTION 6.1. Dissenting Shares 29
ARTICLE 7 CONDITIONS TO THE OFFER 29
SECTION 7.1. Conditions to the Offer 29
ARTICLE 8 CONDITIONS TO CONSUMMATION OF THE MERGER 32
SECTION 8.1. Conditions to Each Party's Obligations to Effect the Merger 32
ARTICLE 9 TERMINATION; AMENDMENT; WAIVER 32
SECTION 9.1. Termination 32
SECTION 9.2. Procedure and Effect of Termination 33
SECTION 9.3. Fees and Expenses 33
SECTION 9.4. Amendment 34
SECTION 9.5. Waiver 34
ARTICLE 10 MISCELLANEOUS 35
SECTION 10.1. Nonsurvival of Representations and Warranties 35
SECTION 10.2. Entire Agreement; Assignment 35
SECTION 10.3. Validity 35
SECTION 10.4. Notices 35
SECTION 10.5. Governing Law 36
SECTION 10.6. Descriptive Headings 36
SECTION 10.7. Parties in Interest 36
SECTION 10.8. Certain Definitions 36
SECTION 10.9. Personal Liability 36
SECTION 10.10. Specific Performance 36
SECTION 10.11. Counterparts 37
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TABLE OF DEFINED TERMS
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Acquiring Person........................................................................................... 19
Acquisition................................................................................................ 1
Acquisition Proposal....................................................................................... 24
Affiliate.................................................................................................. 37
Agreement.................................................................................................. 1
Blue Sky Laws.............................................................................................. 11
Board...................................................................................................... 1
Break-Up Fee 34
Business Day............................................................................................... 37
Cash Merger Consideration.................................................................................. 6
Certificates............................................................................................... 7
Closing Time............................................................................................... 5
Company.................................................................................................... 1
Company Disclosure Schedule................................................................................ 8
Company Employee Plan...................................................................................... 13
Company Employee Plans..................................................................................... 13
Company Option Plan........................................................................................ 8
Company Option Plans....................................................................................... 8
Company Personnel.......................................................................................... 13
Company Real Assets........................................................................................ 16
Company SEC Reports........................................................................................ 10
Company Securities......................................................................................... 9
Company Stock Option....................................................................................... 8
Company Stock Options...................................................................................... 8
Confidentiality Agreement.................................................................................. 26
Continuing Directors....................................................................................... 5
Contracts.................................................................................................. 17
Cure Time.................................................................................................. 32
DGCL....................................................................................................... 3
Disclosure Statement....................................................................................... 11
Dissenting Shares.......................................................................................... 29
Distribution Date.......................................................................................... 3
Effective Time............................................................................................. 5
Environmental Claim........................................................................................ 15
Environmental Laws......................................................................................... 14
ERISA...................................................................................................... 13
Exchange Act............................................................................................... 1
Expiration Date............................................................................................ 19
Governmental Entity........................................................................................ 11
GP......................................................................................................... 1
HSR Act.................................................................................................... 11
Indemnified Parties........................................................................................ 28
Intangible Property........................................................................................ 19
Knowledge.................................................................................................. 12
Lien....................................................................................................... 9
Material Adverse Effect.................................................................................... 9
Material Change............................................................................................ 29
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TERM PAGE
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Merger..................................................................................................... 5
Merger Certificate......................................................................................... 5
Merger Fund................................................................................................ 7
Minimum Stock Condition.................................................................................... 2
Offer...................................................................................................... 1
Offer Documents............................................................................................ 2
Parent..................................................................................................... 1
Parent Material Adverse Effect............................................................................. 20
Payment Agent.............................................................................................. 6
Per Share Amount........................................................................................... 1
Permitted Liens............................................................................................ 16
Person..................................................................................................... 37
Right...................................................................................................... 6
Rights..................................................................................................... 6
Rights Agreement........................................................................................... 6
Schedule 14D-9 3
SEC........................................................................................................ 2
Section 203 Approval 3
Securities Act............................................................................................. 10
Share...................................................................................................... 1
Shares..................................................................................................... 1
Stock...................................................................................................... 37
Stockholders Agreement..................................................................................... 5
Stockholders' Meeting...................................................................................... 24
Subsidiaries............................................................................................... 37
Subsidiary................................................................................................. 37
Superior Proposal.......................................................................................... 25
Surviving Corporation...................................................................................... 5
Tax........................................................................................................ 15
Tax Return................................................................................................. 15
Taxes...................................................................................................... 15
Tender Offer Purchase Time................................................................................. 4
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MERGER AGREEMENT
THIS MERGER AGREEMENT (this "Agreement") dated as of June 10, 1999, is among
STERIGENICS INTERNATIONAL, INC., a Delaware corporation ("Company"), ION BEAM
APPLICATIONS S.A., a Belgian corporation ("Parent"), ION BEAM APPLICATIONS G.P.
a general partnership organized under the laws of Delaware which is controlled
by Parent ("GP") and IBA ACQUISITION CORP., a Delaware corporation which is
wholly-owned by GP ("Acquisition").
WHEREAS, the Board of Directors of the Company (the "Board") has, in light
of and subject to the terms and conditions set forth herein, (i) determined that
each of the Offer and the Merger (each as defined below) is advisable on
substantially the terms and conditions set forth herein and is fair to the
stockholders of the Company and in the best interests of such stockholders and
(ii) approved and adopted this Agreement and the transactions contemplated
hereby and resolved, subject to the terms hereof, to recommend acceptance of the
Offer and approval and adoption by the stockholders of the Company, if
necessary, of this Agreement; and
WHEREAS, in furtherance thereof, it is proposed that Acquisition shall,
within five (5) business days after the public announcement hereof, commence a
tender offer (the "Offer") to acquire all of the issued and outstanding Shares
(defined herein) together with the associated Rights (defined herein) which are
not owned by Parent, GP, or Acquisition or any affiliate thereof, at a price of
$27.00 per Share (subject to adjustment for stock splits, stock dividends,
combinations, recapitalizations or the like) (such amount, being hereinafter
referred to as the "Per Share Amount"), net to the seller in cash, less any
required withholding of taxes, in accordance with the terms and subject to the
conditions provided herein;
NOW THEREFORE, in consideration of the premises and the representations,
warranties, covenants and agreements herein contained and intending to be
legally bound hereby, the Company, Parent, GP, and Acquisition hereby agree as
follows:
ARTICLE 1
THE OFFER
SECTION 1.1. THE OFFER. (a) Provided that this Agreement shall not have been
terminated in accordance with Section 9.1, as promptly as possible but in no
event later than five (5) business days after the public announcement of the
execution hereof by the parties, Parent and GP shall cause Acquisition to
commence (within the meaning of Rule 14d-2 under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), the Offer; and to cause Acquisition to
use its best efforts to consummate the Offer, including, without limitation,
engaging an information agent in connection therewith. Acquisition shall accept
for payment issued and outstanding shares of common stock, $0.001 par value of
the Company (individually a "Share" and collectively, the "Shares") together
with the associated Rights which have been validly tendered and not withdrawn
pursuant to the Offer at the earliest time following expiration of the Offer
that all conditions to the Offer shall have been satisfied or waived by
Acquisition. The obligation of Acquisition to accept for payment, purchase and
pay for Shares tendered pursuant to the Offer shall be subject to the condition
that the number of Shares validly tendered and not withdrawn prior to the
expiration of the Offer, combined with the Shares already owned by Parent, GP,
Acquisition or any of their affiliates, constitutes at least a majority of the
then outstanding Shares on a fully-diluted basis (including for purposes of such
calculation all Shares issuable upon exercise of all vested and unvested stock
options, and conversion of convertible securities or other rights to purchase or
acquire Shares) at the expiration of the Offer (the "Minimum Stock Condition")
and the other conditions set forth in Article 7. Acquisition expressly reserves
the right to waive any such condition, to increase the Per Share Amount, and to
make any other changes in the terms and conditions of the Offer; PROVIDED,
HOWEVER, that Parent, GP and Acquisition agree that no change may be made
without the written consent of the Company which decreases the Per Share Amount,
which changes the form of consideration to be paid in the Offer, which reduces
the maximum number of shares to be purchased in the Offer, which reduces the
Minimum Stock Condition to below a majority of the then outstanding shares (on a
fully-diluted basis), which otherwise modifies or amends the conditions to the
Offer or any other term of the Offer in a manner that is
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materially adverse to the holders of the Shares, which imposes conditions to the
Offer in addition to those set forth in Article 7 or which extends the
expiration date of the Offer beyond September 30, 1999 (except that Acquisition
may extend the expiration date of the Offer beyond September 30, 1999 as
required to comply with any rule, regulation or interpretation of the Securities
and Exchange Commission or to provide the time necessary to satisfy the
conditions set forth in Article 7). It is agreed that the conditions set forth
in Article 7 are for the sole benefit of Acquisition and may be asserted by
Acquisition regardless of the circumstances giving rise to any such condition
(including any action or inaction by Acquisition) or may be waived by
Acquisition, in whole or in part at any time and from time to time, in its sole
discretion. The failure by Acquisition at any time to exercise any of the
foregoing rights shall not be deemed a waiver of any such right and each such
right shall be deemed an ongoing right which may be asserted at any time and
from time to time. The Per Share Amount shall be paid net to the seller in cash,
less any required withholding of taxes, upon the terms and subject to such
conditions of the Offer. The Company agrees that no Shares held by the Company
or any of its subsidiaries will be tendered in the Offer.
(b) As soon as practicable after the date hereof, Parent, GP and Acquisition
agree that Parent, GP and Acquisition shall file with the Securities and
Exchange Commission (the "SEC") a Tender Offer Statement on Schedule 14D-1 with
respect to the Offer, which shall include an offer to purchase and form of
transmittal letter (together with any amendments thereof or supplements thereto,
collectively the "Offer Documents"). The Company and its counsel shall be given
a reasonable opportunity to review and comment on the Offer Documents prior to
their filing with the SEC or dissemination to the stockholders of the Company.
Parent and Acquisition agree to provide the Company and its counsel with any
comments which Parent, Acquisition or their counsel may receive from the SEC or
the staff of the SEC with respect to such documents promptly after receipt
thereof. The Offer Documents will comply in all material respects with the
provisions of applicable federal securities laws. The information provided and
to be provided by Parent, GP and Acquisition for use in the Offer Documents
shall not, on the date filed with the SEC and on the date first published or
sent or given to the Company's stockholders, as the case may be, contain any
untrue statement of a material fact nor 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, PROVIDED,
HOWEVER, that no representation or warranty is made by Parent, GP or Acquisition
with respect to information supplied by the Company or any of its stockholders
for inclusion in the Offer Documents. The Company agrees that information
provided by the Company or any of its subsidiaries for inclusion or
incorporation in the Offer Documents shall not, on the date filed with the SEC
and on the date first published or sent or given to the Company's stockholders,
as the case may be, contain any untrue statement of a material fact nor 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. Parent, GP, Acquisition and the Company each agree
promptly to correct any information provided by it for use in the Offer
Documents if and to the extent that such information shall have become false or
misleading in any material respect and Parent, GP and Acquisition further agree
to take all steps necessary to cause the Offer Documents as so corrected to be
filed with the SEC and to be disseminated to holders of Shares, in each case as
and to the extent required by applicable federal securities laws.
SECTION 1.2. COMPANY ACTION. (a) The Company hereby approves of and consents
to the Offer and the Merger and represents and warrants that (i) the Board has,
subject to the terms and conditions set forth herein, adopted final and binding
resolutions, which have not been amended or repealed, pursuant to which the
Board (A) determined that this Agreement, and the transactions contemplated
hereby and thereby, including the Offer and the Merger, are fair to, and in the
best interests of, the stockholders of the Company, (B) approved and adopted
this Agreement, and the Stockholders Agreement (defined herein) and the
transactions contemplated hereby and thereby, including without limitation, the
Merger and the acquisition of Shares by Parent or Acquisition pursuant to the
options granted by the Stockholders under the Stockholders Agreement, and such
approval (the "Section 203 Approval") constitutes the approval of the foregoing
for the purposes of Section 203 of the Delaware General Corporation Law
("DGCL"),
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(C) taken all necessary action to avoid the occurrence of a "Distribution Date"
(as defined in the Rights Agreement referred to in Section 2.8) with respect to
the Rights, and (D) recommended that the stockholders of the Company accept the
Offer, tender their Shares thereunder to Acquisition and, if required by law,
approve and adopt this Agreement and the Merger (provided, however, that subject
to the provisions of Section 5.3 such recommendation may be withdrawn, modified
or amended in connection with a Superior Proposal (as defined in Section 5.3))
and (ii) PaineWebber Incorporated and TM Capital Corp. have each delivered to
the Board a written opinion to the effect that, as of the date of such opinion,
the consideration to be received by the holders of the Shares (other than the
Parent, GP, Acquisition and their affiliates) pursuant to the Offer and Merger
is fair to such holders from a financial point of view. Subject only to the
provisions of Section 5.3, the Company hereby consents to the inclusion in the
Offer Documents of the recommendation of the Board described in the immediately
preceding sentence.
(b) The Company hereby agrees to file with the SEC as soon as practicable
after the date hereof a Solicitation/Recommendation Statement on Schedule 14D-9
pertaining to the Offer (together with any amendments thereof or supplements
thereto, the "Schedule 14D-9") containing the recommendation described in
Section 1.2(a) and to promptly mail the Schedule 14D-9 to the stockholders of
the Company. The Company represents and warrants that the Schedule 14D-9 will
comply in all material respects with the provisions of applicable federal
securities laws and, on the date filed with the SEC and on the date first
published or sent or given to the Company's stockholders, as the case may be,
shall not 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 is made by the Company with
respect to information supplied by Parent, GP or Acquisition in writing for
inclusion in the Schedule 14D-9. The Company, Parent, GP and Acquisition each
agrees promptly to correct any information provided by it for use in the
Schedule 14D-9 if and to the extent that such information shall have become
false or misleading in any material respect and the Company further agrees to
take all steps necessary to cause the Schedule 14D-9 as so corrected to be filed
with the SEC and disseminated to the holders of Shares, in each case as and to
the extent required by applicable federal securities laws.
(c) In connection with the Offer, the Company will promptly furnish Parent
and Acquisition with mailing labels, security position listings and any
available listing or computer files containing the names and addresses of the
record holders of the Shares as of a recent date and shall furnish Acquisition
with such additional information and assistance (including, without limitation,
updated lists of stockholders, mailing labels and lists of securities positions)
as Acquisition or its agents may reasonably request in communicating the Offer
to the record and beneficial holders of Shares. Subject to the requirements of
applicable law, and except for such steps as are necessary to disseminate the
Offer Documents and any other documents necessary to consummate the Merger,
Parent, GP, Acquisition and their affiliates, associates, agents and advisors
shall hold in confidence the information contained in any of such labels and
lists, and use the information contained in any such labels, listings and files
only in connection with the Offer and the Merger, and, if this Agreement shall
be terminated, will deliver to the Company all copies of such information then
in their possession.
SECTION 1.3. BOARDS OF DIRECTORS AND COMMITTEES; SECTION 14(F). (a) Promptly
upon the purchase by Acquisition of Shares following the expiration date (as
such date may be extended) of, and pursuant to, the Offer (the "Tender Offer
Purchase Time") and from time to time thereafter, and subject to the last
sentence of this Section 1.3(a), Acquisition shall be entitled to designate
directors of the Company constituting a majority of the Board, and the Company
shall use its best efforts to, upon request by Acquisition, promptly, at the
Company's election, either increase the size of the Board to the extent
permitted by its Certificate of Incorporation or secure the resignation of such
number of directors as is necessary to enable Acquisition's designees to be
elected to the Board and to cause Acquisition's designees to be so elected and
to constitute at all times after the Tender Offer Purchase Time a majority of
the Board. At such times, and subject to the last sentence of this Section
1.3(a), the Company will use its best efforts to cause persons designated by
Acquisition to constitute the same percentage as is on the Board of
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(i) each committee of the Board (other than any committee of the Board
established to take action under this Agreement), (ii) each board of directors
of each subsidiary of the Company and (iii) each committee of each such board.
Notwithstanding the foregoing, the Company shall use reasonable efforts to
encourage James F. Clouser and Fred Ruegsegger to remain members of the Board
until the Effective Time (as determined herein).
(b) The Company's obligation to appoint designees to the Board shall be
subject to Section 14(f) of the Exchange Act and Rule 14f-1 promulgated
thereunder. The Company shall promptly take all action required pursuant to such
Section and Rule in order to fulfill its obligations under this Section 1.3 and
shall include in the Schedule 14D-9 such information with respect to the Company
and its officers and directors as is required under such Section and Rule in
order to fulfill its obligations under this Section 1.3. Acquisition will supply
to the Company in writing and be solely responsible for any information with
respect to itself and its nominees, officers, directors and affiliates required
by such Section and Rule.
(c) Following the election or appointment of Acquisition's designees
pursuant to this Section 1.3 and prior to the Effective Time, any amendment or
termination of this Agreement, extension of the performance or waiver of the
obligations or other acts of Parent, GP or Acquisition or waiver of the
Company's rights hereunder, shall require the concurrence of a majority of the
Company's directors (or the concurrence of the director, if there is only one
remaining) then in office who are directors on the date hereof, or are directors
(other than directors designated by Acquisition in accordance with this Section
1.3) designated by such persons to fill any vacancy (the "Continuing
Directors").
SECTION 1.4. STOCKHOLDERS AGREEMENT. In order to induce Parent, GP and
Acquisition to enter into this Agreement and to perform their obligations
hereunder and as a condition thereof, Parent, GP and Acquisition shall enter
into the stockholders agreement (the "Stockholders Agreement") on even date
hereof in the form attached hereto as Exhibit A stockholders of the Company
listed in Schedule A to the Stockholders Agreement.
ARTICLE 2
THE MERGER
SECTION 2.1. THE MERGER. At the Effective Time (as defined below) and upon
the terms and subject to the conditions of this Agreement and in accordance with
the DGCL, Acquisition shall be merged with and into the Company (the "Merger").
Following the Merger, the Company shall continue as the surviving corporation
(the "Surviving Corporation") and the separate corporate existence of
Acquisition shall cease. GP, as the sole stockholder of Acquisition, hereby
approves this Agreement, the Merger and the other transactions contemplated
hereby.
SECTION 2.2. CLOSING OF THE MERGER. The closing of the Merger will take
place at a time (the "Closing Time") and on a date to be specified by the
parties, which shall be no later than the second business day after satisfaction
of the latest to occur of the conditions set forth in Article 8 at the offices
of Dorsey & Whitney LLP, 250 Park Avenue, New York, New York 10177, unless
another time, date or place is agreed to in writing by the parties hereto.
SECTION 2.3. EFFECTIVE TIME. Subject to the terms and conditions set forth
in this Agreement, a certificate of merger (the "Merger Certificate") shall be
duly executed and acknowledged by Acquisition and the Company and thereafter
delivered at the Closing Time to the Secretary of State of the State of Delaware
for filing pursuant to the DGCL. The Merger shall become effective at such time
as a properly executed and certified copy of the Merger Certificate is duly
accepted for record by the Secretary of State of the State of Delaware for
filing pursuant to the DGCL, or such later time as Acquisition and the Company
may agree upon and set forth in the Merger Certificate (not exceeding 30 days
after the Merger Certificate is accepted for record; the time the Merger becomes
effective being referred to herein as the "Effective Time").
SECTION 2.4. EFFECTS OF THE MERGER. The Merger shall have the effects set
forth in the DGCL. Without limiting the generality of the foregoing and subject
thereto at the Effective Time, all the properties, rights,
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privileges, powers and franchises of the Company and Acquisition shall vest in
the Surviving Corporation and all debts, liabilities and duties of the Company
and Acquisition shall become the debts, liabilities and duties of the Surviving
Corporation.
SECTION 2.5. CHARTER AND BYLAWS. The Certificate of Incorporation of the
Company in effect at the Effective Time shall be the Certificate of
Incorporation of the Surviving Corporation until amended in accordance with
applicable law. The Bylaws of the Company in effect at the Effective Time shall
be the Bylaws of the Surviving Corporation until amended in accordance with
applicable law.
SECTION 2.6. DIRECTORS. The directors of Acquisition at the Effective Time
shall be the initial directors of the Surviving Corporation, each to hold office
in accordance with the charter and Bylaws of the Surviving Corporation until the
next annual meeting of stockholders and until each such director's successor is
duly elected or appointed and qualified.
SECTION 2.7. OFFICERS. The officers of Acquisition at the Effective Time
shall be the initial officers of the Surviving Corporation, each to hold office
in accordance with the charter and Bylaws of the Surviving Corporation until
such officer's successor is duly elected or appointed and qualified.
SECTION 2.8. CONVERSION OF SHARES.
(a) At the Effective Time, each Share issued and outstanding immediately
prior to the Effective Time, together with the associated right to purchase
shares of Series A Junior Participating Preferred Stock, par value $0.001 per
share (individually, the "Right" and collectively, the "Rights"), issued
pursuant to the Rights Agreement dated as of March 31, 1999 between the Company
and US Stock Transfer Corporation, as Rights Agent (the "Rights Agreement"
(other than (i) Shares together with any associated Rights held by any of the
Company's subsidiaries, (ii) Shares together with any associated Rights held by
Parent, GP, Acquisition or any other subsidiary of Parent and (iii) Dissenting
Shares (defined herein)) shall, by virtue of the Merger and without any action
on the part of Acquisition, the Company or the holder thereof, be converted into
and shall become the right to receive the Per Share Amount in cash, without
interest (the "Cash Merger Consideration"). Notwithstanding the foregoing, if
between the date of this Agreement and the Effective Time, the Shares shall have
been changed into a different number of shares or a different class by reason of
any stock dividend, subdivision, reclassification, recapitalization, split,
combination or exchange of shares, then the Cash Merger Consideration
contemplated by the Merger shall be correspondingly adjusted to reflect such
stock dividend, subdivision, reclassification, recapitalization, split,
combination or exchange of shares.
(b) At the Effective Time, each Share, together with any associated Right,
then owned by Parent, GP, Acquisition, the Company or any direct or indirect
wholly-owned subsidiary of Parent, GP or Acquisition or of the Company shall, by
virtue of the Merger and without any action on the part of Parent, GP,
Acquisition, the Company or the holder thereof, be canceled and retired and will
cease to exist and no payment shall be made with respect thereto.
(c) At the Effective Time, each share of common stock of Acquisition issued
and outstanding immediately prior to the Effective Time shall be converted into
and exchanged for one fully-paid and non-assessable share of common stock, par
value $0.001 per share of the Surviving Corporation.
SECTION 2.9. PAYMENT OF CASH MERGER CONSIDERATION.
(a) As of the Effective Time, Acquisition shall deposit with such agent or
agents as may be appointed by Parent and Acquisition (the "Payment Agent") for
the benefit of the holders of Shares in cash the aggregate amount necessary to
pay the Cash Merger Consideration (such cash is hereinafter referred to as the
"Merger Fund") payable pursuant to Section 2.8 in exchange for outstanding
Shares.
(b) As soon as reasonably practicable after the Effective Time, the Payment
Agent shall mail to each holder of record of a certificate or certificates which
immediately prior to the Effective Time represented outstanding Shares (the
"Certificates") whose shares were converted into the right to receive the Cash
Merger Consideration pursuant to Section 2.8: (i) a letter of transmittal (which
shall specify that delivery shall be effected and risk of loss and title to the
Certificates shall pass only upon delivery of the Certificates
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to the Payment Agent and shall be in such form and have such other provisions as
Parent and the Company may reasonably specify) and (ii) instructions on how to
surrender the Certificates in exchange for the Cash Merger Consideration. Upon
surrender to the Payment Agent of a Certificate for cancellation, together with
such letter of transmittal duly executed, the holder of such Certificate shall
be entitled to receive in exchange therefor a check representing the Cash Merger
Consideration which such holder has the right to receive pursuant to the
provisions of this Article 2 and the Certificate so surrendered shall forthwith
be canceled. In the event of a transfer of ownership of Shares which is not
registered in the transfer records of the Company, payment of the Cash Merger
Consideration may be made to a transferee if the Certificate representing such
Shares is presented to the Payment Agent accompanied by all documents required
to evidence and effect such transfer and by evidence that any applicable stock
transfer taxes have been paid. Until surrendered as contemplated by this Section
2.9, each Certificate shall be deemed at any time after the Effective Time to
represent only the right to receive upon such surrender the Cash Merger
Consideration as contemplated by this Section 2.9.
(c) In the event that any Certificate shall have been lost, stolen or
destroyed, the Payment Agent shall issue in exchange therefor, upon the making
of an affidavit of that fact by the holder thereof, such Cash Merger
Consideration as may be required pursuant to this Agreement; provided, however,
that Acquisition or its Payment Agent may, in its discretion, require the
delivery of a suitable bond or indemnity.
(d) All Cash Merger Consideration paid upon the surrender for exchange of
Shares in accordance with the terms hereof shall be deemed to have been paid in
full satisfaction of all rights pertaining to such Shares; subject, however, to
the Surviving Corporation's obligation to pay any dividends or make any other
distributions with a record date prior to the Effective Time which may have been
declared or made by the Company on such Shares in accordance with the terms of
this Agreement, or prior to the date hereof and which remain unpaid at the
Effective Time, and there shall be no further registration of transfers on the
stock transfer books of the Surviving Corporation of the Shares which were
outstanding immediately prior to the Effective Time. If after the Effective Time
Certificates are presented to the Surviving Corporation for any reason they
shall be canceled and exchanged as provided in this Article 2.
(e) Any portion of the Merger Fund which remains undistributed to the
stockholders of the Company for six months after the Effective Time shall be
delivered to Parent upon demand and any stockholders of the Company who have not
theretofore complied with this Article 2 shall thereafter look only to Parent
for payment of their claim for the Cash Merger Consideration.
(f) Neither Acquisition nor the Company shall be liable to any holder of
Shares for cash from the Merger Fund delivered to a public official pursuant to
any applicable abandoned property, escheat or similar law.
SECTION 2.10. STOCK OPTIONS; PURCHASE PLAN.
(a) At the Effective Time, each outstanding option to purchase Shares (a
"Company Stock Option" or collectively "Company Stock Options") issued pursuant
to the Company's 1997 Equity Incentive Plan and its Second Amended and Restated
1986 Stock Option Plan (a "Company Option Plan" or collectively "Company Option
Plans") shall vest in full and the Surviving Corporation shall pay to the holder
of each outstanding Company Stock Option an amount equal to the excess, if any,
of the Per Share Amount over the exercise price per Share of such Company Stock
Option, less the amount of Taxes (defined below) required to be withheld under
Federal, state or local laws and regulations multiplied by the number of Shares
subject to such Company Stock Option. To the extent required the Company will
take all reasonable steps to effectuate the foregoing provisions of this Section
2.10.
(b) Except as provided herein or as otherwise agreed to by the parties and
to the extent permitted by the Company Option Plan, the Company Option Plans
shall terminate as of the Effective Time and any rights under any provisions
under the Company Option Plans and any awards issued thereunder shall be
canceled as of the Effective Time.
(c) The Company shall amend the 1997 Employee Stock Purchase Plan to provide
for (A) the suspension of participation during the offering periods commencing
subsequent to the date of the Agreement for the pendency of the Merger and
subject to the successful consummation of the Merger and (B) the termination of
such Plan as of the Effective Time.
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ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as set forth on the Disclosure Schedule previously delivered by the
Company to Parent (the "Company Disclosure Schedule"), the Company hereby
represents and warrants to each of Parent, GP and Acquisition as follows:
SECTION 3.1. ORGANIZATION AND QUALIFICATION; SUBSIDIARIES.
(a) Section 3.1 of the Company Disclosure Schedule identifies each
subsidiary of the Company as of the date hereof and its respective jurisdiction
of incorporation or organization, as the case may be. The Company and each of
its subsidiaries is duly organized, validly existing and in good standing under
the laws of the jurisdiction of its incorporation or organization as set forth
in Section 3.1 of the Company Disclosure Schedule and has all requisite power
and authority to own lease and operate its properties and to carry on its
businesses as now being conducted, except where such failure to so qualify would
not have a Material Adverse Effect (defined herein) on the Company. The Company
has heretofore provided Parent with access to accurate and complete copies of
the charter and Bylaws (or similar governing documents), as currently in effect,
of the Company and its subsidiaries.
(b) Except as disclosed in Section 3.1(b) of the Company Disclosure
Schedule, each of the Company and its subsidiaries is duly qualified or licensed
and in good standing to do business in each jurisdiction in which the property
owned, leased or operated by it or the nature of the business conducted by it
makes such qualification or licensing necessary, except in such jurisdictions
where the failure to be so duly qualified or licensed and in good standing would
not have a Material Adverse Effect on the Company. When used in connection with
the Company or its subsidiaries, the term "Material Adverse Effect" means any
change or effect (i) that is materially adverse to the business, properties,
financial condition or results of operations of the Company and its
subsidiaries, taken as whole, or (ii) that would materially impair the ability
of the Company to consummate the transactions contemplated hereby.
SECTION 3.2. CAPITALIZATION OF THE COMPANY AND ITS SUBSIDIARIES.
(a) As of the date hereof, the authorized stock of the Company consists of
15,000,000 Shares, of which, as of May 31, 1999, 8,005,802 Shares were issued
and outstanding, and 1,000,000 shares of preferred stock, par value $0.001 per
share, no shares of which are outstanding. All of the outstanding Shares have
been validly issued and are fully paid, nonassessable and free of preemptive
rights. As of May 31, 1999, approximately 1,182,210 Shares were reserved for
issuance and issuable upon or otherwise deliverable in connection with the
exercise of outstanding Company Stock Options issued pursuant to the Company
Option Plans referred to in Section 2.10. Between May 31, 1999 and the date
hereof, no shares of the Company's stock have been issued other than pursuant to
Company Stock Options, and between May 31, 1999 and the date hereof no stock
options have been granted. Except as set forth above and in Section 3.2(a) of
the Company Disclosure Schedule, as of the date hereof, there are issued,
reserved for issuance, or outstanding (i) no shares of stock or other voting
securities of the Company, (ii) no securities of the Company or its subsidiaries
convertible into or exchangeable for shares of stock or voting securities of the
Company, (iii) no options or other rights to acquire from the Company or its
subsidiaries and, except as described in the Company SEC Reports (defined
herein), no obligations of the Company or its subsidiaries to issue any stock,
voting securities or securities convertible into or exchangeable for stock or
voting securities of the Company, (iv) no bonds, debentures, notes or other
indebtedness or obligations of the Company or any of its subsidiaries entitling
the holders thereof to have the right to vote (or which are convertible into, or
exercisable or exchangeable for, securities entitling the holders thereof to
have the right to vote) with the stockholders of the Company or any of its
subsidiaries on any matter, (v) no equity equivalent interests in the ownership
or earnings of the Company or its subsidiaries or other similar rights, and (vi)
the Rights (collectively "Company Securities"). As of the date hereof, there are
no outstanding obligations of the Company or its subsidiaries (absolute,
contingent or otherwise) to repurchase, redeem or otherwise acquire any Company
Securities. There are no Shares outstanding subject to rights of first
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refusal of the Company, nor are there any pre-emptive rights with respect to any
Shares. Other than this Agreement, there are no stockholder agreements, voting
trusts or other agreements or understandings to which the Company is a party or
by which it is bound relating to the voting or registration of any shares of
stock of the Company.
(b) Except as disclosed in Section 3.2(b) of the Company Disclosure
Schedule, all of the outstanding stock of the Company's subsidiaries is owned by
the Company, directly or indirectly, free and clear of any Lien (defined herein)
or any other limitation or restriction (including any restriction on the right
to vote or sell the same except as may be provided as a matter of law). There
are no securities of the Company or its subsidiaries convertible into or
exchangeable for, no options or other rights to acquire from the Company or its
subsidiaries and no other contract, understanding, arrangement or obligation
(whether or not contingent) providing for, the issuance or sale, directly or
indirectly, of any stock or other ownership interests in, or any other
securities of any subsidiary of, the Company. There are no outstanding
contractual obligations of the Company or its subsidiaries to repurchase, redeem
or otherwise acquire any outstanding shares of capital stock or other ownership
interests in any subsidiary of the Company. For purposes of this Agreement,
"Lien" means, with respect to any asset (including without limitation any
security), any mortgage, lien, pledge, charge, security interest or encumbrance
of any kind in respect of such asset.
(c) The Shares and the Rights constitute the only classes of equity
securities of the Company or its subsidiaries registered or required to be
registered under the Exchange Act.
SECTION 3.3. AUTHORITY RELATIVE TO THIS AGREEMENT; RECOMMENDATION.
The Company has all necessary corporate power and authority to execute and
deliver this Agreement and, if required by law, subject to stockholder approval
of the Merger, to consummate the transactions contemplated hereby. The execution
and delivery of this Agreement and the consummation of the transactions
contemplated hereby have been duly and validly authorized by the Board and no
other corporate proceedings on the part of the Company are necessary to
authorize this Agreement or to consummate the transactions contemplated hereby
except, if required by law, the approval and adoption of this Agreement and the
Merger by the holders of the outstanding Shares. This Agreement has been duly
and validly executed and delivered by the Company and assuming the due
authorization, execution and delivery by Parent, GP and Acquisition, constitutes
a valid, legal and binding agreement of the Company enforceable against the
Company in accordance with its terms, except as such enforceability may be
limited by any applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights generally, and
except as the availability of equitable remedies may be limited by the
application of general principles of equity (regardless of whether such
equitable principle is applied in a proceeding at law or in equity).
The Board has duly and validly approved, and taken all corporate actions
required to be taken by the Board for the consummation of, the transactions
contemplated hereby, including the Offer and the acquisition of the Shares
pursuant thereto and the Merger. The Board has taken all appropriate action so
that none of Parent, GP or Acquisition will be an "interested stockholder"
within the meaning of Section 203 of the DGCL by virtue of Parent, GP,
Acquisition and the Company entering into this Agreement, or the Stockholders
Agreement or any other agreement contemplated hereby or thereby and consummating
the transactions contemplated hereby and thereby.
SECTION 3.4. SEC REPORTS; FINANCIAL STATEMENTS.
(a) The Company has filed all required forms, reports and documents
("Company SEC Reports") with the SEC since its initial public offering on August
13, 1997, each of which has complied in all material respects with all
applicable requirements of the Securities Act of 1933, as amended (the
"Securities Act"), and the Exchange Act, each as in effect on the dates such
forms, reports and documents were filed. None of such Company SEC Reports,
including, without limitation, any financial statements or schedules
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included or incorporated by reference therein, contained when filed any untrue
statement of a material fact or omitted to state a material fact required to be
stated or incorporated by reference therein or necessary in order to make the
statements therein, in light of the circumstances under which they were made,
not misleading. The audited consolidated financial statements of the Company
included in the Company SEC Reports fairly present in conformity with GAAP
(except as may be indicated in the notes thereto or, in the case of unaudited
consolidated quarterly statements, as permitted by Form 10-Q of the SEC) the
consolidated financial position of the Company and its consolidated subsidiaries
as of the dates thereof and their consolidated results of operations and changes
in financial position for the periods then ended.
(b) The Company has heretofore made available or promptly will make
available to Acquisition or Parent a complete and correct copy of any amendments
or modifications which are required to be filed with the SEC but have not yet
been filed with the SEC to agreements, documents or other instruments which
previously had been filed by the Company with the SEC pursuant to the Exchange
Act.
SECTION 3.5. INFORMATION SUPPLIED. Neither the Schedule 14D-9 nor any of the
information supplied or to be supplied by the Company for inclusion or
incorporation by reference in the Offer Documents, Schedule 14D-9, any other
tender offer materials, Schedule 14A or 14C, or the proxy statement or
information statement ("Proxy Statement") relating to any meeting of the
Company's stockholders to be held in connection with the Merger (all of the
foregoing documents, collectively, the "Disclosure Statements") will, at the
date each and any of the Disclosure Statements is filed with the SEC or are
first published, mailed to stockholders of the Company, and at the time of the
meeting of stockholders of the Company to be held, if necessary, in connection
with the Merger (the "Stockholders' Meeting" (defined herein)) 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 are made, not misleading; PROVIDED,
HOWEVER, that no representation or warranty is made by the Company with respect
to information supplied by Parent, Acquisition or GP, for inclusion in the
Disclosure Statements. The Disclosure Statements will comply as to form in all
material respects with all provisions of applicable law.
SECTION 3.6. CONSENTS AND APPROVALS; NO VIOLATIONS. Except for filings,
permits, authorizations, consents and approvals as may be required under, and
other applicable requirements of, the Exchange Act, state securities laws ("Blue
Sky Laws"), the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended
(the "HSR Act"), and the securities or antitrust laws of any foreign country,
and the filing and recordation and acceptance for record of the Merger
Certificate as required by the DGCL, respectively, no filing with or notice to
and no permit, authorization, consent or approval of any court or tribunal, or
administrative governmental or regulatory body, agency or authority (a
"Governmental Entity") is necessary for the execution and delivery by the
Company of this Agreement or the consummation by the Company of the transactions
contemplated hereby, except where the failure to obtain such permits,
authorizations, consents or approvals or to make such filings or give such
notice would not have a Material Adverse Effect. Neither the execution, delivery
and performance of this Agreement by the Company nor the consummation by the
Company of the transactions contemplated hereby will (i) conflict with or result
in any breach of any provision of the respective charter or Bylaws (or similar
governing documents) of the Company or any of its subsidiaries, (ii) result in a
violation or breach of or constitute (with or without due notice or lapse of
time or both) a default (or give rise to any right of termination, amendment,
cancellation or acceleration or Lien) under any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, lease, license, contract,
agreement or other instrument or obligation to which the Company or any of its
subsidiaries is a party or by which any of them or any of their respective
properties or assets may be bound or (iii) conflict with or violate any order,
writ, injunction, decree, law, statute, rule or regulation applicable to the
Company or any of its subsidiaries or any of their respective properties or
assets except, in the case of (ii) or (iii), for violations, breaches or
defaults which would not have a Material Adverse Effect.
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SECTION 3.7. COMPLIANCE WITH APPLICABLE LAW. Neither the Company nor any of
its subsidiaries is in conflict with, or in default or violation of (a) its
respective charter or certificate of incorporation, bylaws, or other charter or
organization documents, (b) to the Company's Knowledge (defined herein), any
law, statute, rule, regulation, order, judgment, writ, injunction or decree
applicable to the Company or any of its subsidiaries or any of their respective
properties or assets, or (c) any note, bond, mortgage, indenture, contract,
agreement, lease, license, permit, franchise or other instrument or obligation
to which the Company or any of its subsidiaries is a party or by which the
Company or any of its subsidiaries or any property or asset of the Company or
any of its subsidiaries may be bound or affected, in the case of (b) or (c), the
effect of which conflict, default or violation, either individually or in the
aggregate, would be reasonably likely to be a Material Adverse Effect. To the
Company's Knowledge, the Company and its subsidiaries hold all material
licenses, permits, approvals and other authorizations of Governmental Entities,
and are in substantial compliance with all applicable laws and governmental
regulations in connection with their businesses as now being conducted (except
where such non-compliance would not have a Material Adverse Effect on the
Company). For the purposes hereof, the term "Knowledge" with respect to the
Company means the actual knowledge of the officers and directors of the Company
including knowledge obtained in the ordinary course of the operation of the
business of the Company from the managers of the facilities of the Company.
SECTION 3.8. NO UNDISCLOSED LIABILITIES; ABSENCE OF CHANGES. Except to the
extent publicly disclosed in the Company's SEC Reports or in the Company
Disclosure Schedule, as of December 31, 1998, none of the Company or any of its
subsidiaries had any material liabilities or obligations of any nature, whether
or not accrued, contingent or otherwise, that would be required by GAAP to be
reflected on a consolidated balance sheet of the Company and its subsidiaries
(including the notes thereto) or which would have a Material Adverse Effect on
the Company and since such date, the Company has incurred no such liability or
obligation. Since December 31, 1998, except as disclosed in the Company SEC
Reports, (a) the Company and its subsidiaries have conducted their respective
businesses only in the ordinary course and in a manner consistent with past
practice and (b) there has not been (i) any change, event, occurrence or
circumstance in the business, operations, properties, financial condition or
results of operations of the Company or any of its subsidiaries which,
individually or in the aggregate, has a Material Adverse Effect on the Company
(except for changes, events, occurrences or circumstances (A) with respect to
general economic conditions or (B) arising as a result of the transactions
contemplated hereby), (ii) any material change by the Company in its accounting
methods, principles or practices, (iii) any authorization, declaration, setting
aside or payment of any dividend or distribution or capital return in respect of
any stock of, or other equity interest in, the Company or any of its
subsidiaries, (iv) any material revaluation for financial statement purposes by
the Company or any of its subsidiaries of any asset (including, without
limitation, any writing down of the value of any property, investment or asset
or writing off of notes or accounts receivable), (v) other than payment of
compensation for services rendered to the Company or any of its subsidiaries in
the ordinary course of business consistent with past practice or the grant of
Company Stock Options as described in (and in amounts consistent with) Section
3.2, any material transactions between the Company or any of its subsidiaries,
on the one hand, and any (A) officer or director of the Company or any of its
subsidiaries, (B) record or beneficial owner of five percent (5%) or more of the
voting securities of the Company, or (C) affiliate of any such officer, director
or beneficial owner, on the other hand, or (vi) other than pursuant to the terms
of the plans, programs or arrangements specifically referred to in Section 3.11
or Section 3.11 of the Company Disclosure Schedule or in the ordinary course of
business consistent with past practice, any increase in or establishment of any
bonus, insurance, welfare, severance, deferred compensation, pension,
retirement, profit sharing, stock option (including, without limitation, the
granting of stock options, stock appreciation rights, performance awards or
restricted stock awards), stock purchase or other employee benefit plan, or any
other increase in the compensation payable or to become payable to any
employees, officers, directors or consultants of the Company or any of its
subsidiaries, which increase or establishment, individually or in the aggregate,
will result in a material liability.
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SECTION 3.9. LITIGATION. Except as publicly disclosed in the Company SEC
Reports, there is no suit, claim, action, proceeding or investigation pending
or, to the Company's Knowledge, threatened against the Company or any of its
subsidiaries or any of their respective properties or assets before any
Governmental Entity which individually or in the aggregate could reasonably be
expected to have a Material Adverse Effect on the Company or could reasonably be
expected to prevent or delay the consummation of the transactions contemplated
by this Agreement. Except as publicly disclosed by the Company in the Company
SEC Reports, none of the Company or its subsidiaries nor any property or asset
of the Company or any of its subsidiaries is subject to any outstanding order,
writ, injunction or decree which insofar as can be reasonably foreseen in the
future could reasonably be expected to have a Material Adverse Effect on the
Company or could reasonably be expected to prevent or delay the consummation of
the transactions contemplated hereby.
SECTION 3.10. YEAR 2000 COMPLIANCE. To the Company's Knowledge, the
disclosure contained in the Company's quarterly report on Form 10-Q for the
quarter ended December 31, 1998 does not contain any material misstatement or
omission regarding the status of the Company's Year 2000 readiness.
SECTION 3.11. EMPLOYEE BENEFIT PLANS; LABOR MATTERS
(a) Section 3.11(a) of the Company Disclosure Schedule sets forth each plan
which is subject to the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), and each other material agreement, arrangement or commitment
which is an employment or consulting agreement, executive or incentive
compensation plan, bonus plan, deferred compensation agreement, employee
pension, profit sharing, savings or retirement plan, employee stock option or
stock purchase plan, group life, health, or accident insurance or other employee
benefit plan, agreement, arrangement or commitment, including, without
limitation, severance, vacation, holiday or other bonus plans, currently
maintained by the Company or any of its subsidiaries for the benefit of any
present or former employees, officers or directors of the Company or any of its
subsidiaries ("Company Personnel") or with respect to which the Company or any
of its subsidiaries has liability or makes or has an obligation to make
contributions (each such plan, agreement, arrangement or commitment set forth in
Section 3.11(a) of the Company Disclosure Schedule being hereinafter referred to
as a "Company Employee Plan").
(b) With respect to each Company Employee Plan maintained or contributed to
by the Company or any trade or business which is under common control with the
Company within the meaning of Section 414 of the Code (the "Company Employee
Plans"), the Company has made available to Parent a true and complete copy of,
to the extent applicable, (i) such Company Employee Plan, (ii) the most recent
annual report (Form 5500), (iii) each trust agreement related to such Company
Employee Plan, (iv) the most recent summary plan description for each Company
Employee Plan for which such a description is required, (v) the most recent
actuarial report relating to any Company Employee Plan subject to Title IV of
ERISA and (vi) the most recent IRS determination letter issued with respect to
any Company Employee Plan that is intended to qualify under Section 401(a) of
the Code.
(c) Each Company Employee Plan which is intended to be qualified under
Section 401(a) of the Code has received a favorable determination from the IRS
covering the provisions of the Tax Reform Act of 1986 stating that such Company
Employee Plan is so qualified and nothing has occurred since the date of such
letter that could reasonably be expected to affect the qualified status of such
plan. Each Company Employee Plan has been operated in all material respects in
accordance with its terms and the requirements of applicable law (except as
would not have a Material Adverse Effect on the Company). Neither the Company
nor any ERISA Affiliate of the Company has incurred or is reasonably expected to
incur any liability under Title IV of ERISA in connection with any Company
Employee Plan (except as would not have a material effect on the Company).
(d) To the Company's Knowledge, no employee of the Company or any of its
subsidiaries (i) is in violation of any term of any employment contract, patent
disclosure agreement, noncompetition agreement, or any restrictive covenant with
a former employer relating to the right of any such employee to be
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employed by the Company or any of its subsidiaries because of the nature of the
business conducted or presently proposed to be conducted by the Company or any
of its subsidiaries or to the use of trade secrets or proprietary information of
others and (ii) has given notice to the Company or any of its subsidiaries, that
any employee intends to terminate his or her employment with the Company except
for terminations of a nature and number that are consistent with the Company's
prior experience. Neither the Company nor any of its subsidiaries is a party to
any collective bargaining agreement or other labor union contract applicable to
Company Personnel. To the Company's Knowledge, there are no activities or
proceedings of any labor union to organize any employees of the Company or any
of its subsidiaries and there are no strikes, or material slowdowns, work
stoppages or lockouts, or threats thereof by or with respect to any employees of
the Company or any of its subsidiaries. The Company and its subsidiaries are and
have been in compliance with all applicable laws regarding employment practices,
terms and conditions of employment, and wages and hours (including, without
limitation, OSHA, ERISA, WARN or any similar state or local law) (except as
would not have a Material Adverse Effect on the Company).
(e) Except as disclosed in Section 3.11(e) of the Company Disclosure
Schedule, the transactions contemplated by this Agreement (either alone or
together with any other transaction(s) or event(s)) will not (i) entitle any
Company Personnel to severance pay or other similar payments under any Company
Employee Plan, (ii) accelerate the time of payment or vesting or increase the
amount of benefits due under any Company Employee Plan or compensation to any
Company Personnel, (iii) result in any payments (including parachute payments)
under any Company Employee Plan becoming due to any Company Personnel, or (iv)
terminate or modify or give a third party a right to terminate or modify the
provisions or terms of any Company Employee Plan.
SECTION 3.12. ENVIRONMENTAL LAWS AND REGULATIONS.
(a) Except as publicly disclosed in the Company SEC Reports, to the
Company's Knowledge, (i) the properties, assets and operations of the Company
and its subsidiaries are in material compliance with all applicable federal,
state, local and foreign laws and regulations, orders, decrees, judgments,
permits and licenses relating to public and worker health and safety and to the
protection and clean-up of the natural environment (including, without
limitation, ambient air, surface water, ground water, land surface or subsurface
strata) and activities or conditions relating thereto, including, without
limitation, those relating to the generation, handling, disposal, transportation
or release of hazardous materials (collectively "Environmental Laws"), except
for non-compliance that would not have a Material Adverse Effect, which
compliance includes but is not limited to, the possession by the Company and its
subsidiaries of all material permits and other governmental authorizations
required under applicable Environmental Laws and compliance with the terms and
conditions thereof; (ii) none of the Company or its subsidiaries has received
written notice of or, to the Company's Knowledge, is the subject of any
Environmental Claim (defined below) that could reasonably be expected to have a
Material Adverse Effect on the Company; and (iii) to the Company's Knowledge,
there are no circumstances that are reasonably likely to prevent or interfere
with such material compliance in the future.
(b) Except as disclosed in the Company SEC Reports, there is no action,
cause of action, claim, investigation, demand or notice by any person or entity
alleging liability under or non-compliance with any Environmental Law (an
"Environmental Claim") which could reasonably be expected to have a Material
Adverse Effect that is pending or, to the Company's Knowledge, threatened
against the Company or its subsidiaries or, to the Company's Knowledge, against
any person or entity whose liability for any Environmental Claim the Company or
any of its subsidiaries has or may have retained or assumed either contractually
or by operation of law.
SECTION 3.13. TAXES
(a) For purposes of this Agreement: (i) "Tax" or "Taxes" means any taxes,
charges, fees, levies, or other assessments imposed by any U.S. or foreign
governmental entity, whether national, state, county, local or other political
subdivision, including, without limitation, all net income, gross income, sales
and
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use, rent and occupancy, value added, ad valorem, transfer, gains, profits,
excise, franchise, real and personal property, gross receipt, capital stock,
business and occupation, disability, employment, payroll, license, estimated, or
withholding taxes or charges imposed by any governmental entity, and includes
any interest and penalties on or additions to any such taxes (and includes taxes
for which the Company and/or any of its subsidiaries, as the case may be, may be
liable in its own right, or as the transferee of the assets of, or as successor
to, any other corporation, association, partnership, joint venture, or other
entity, or under Treasury Regulation Section 1.1502-6 or any similar provision
of foreign, state or local law); and (ii) "Tax Return" means a report, return or
other information required to be supplied to a governmental entity with respect
to Taxes including, where permitted or required, group, combined or consolidated
returns for any group of entities that includes the Company or any of its
subsidiaries.
(b) Except as set forth in Section 3.13(b) of the Company Disclosure
Schedule, the Company and each of its subsidiaries, and any affiliated or
combined group of which the Company or any of its subsidiaries is or was a
member for applicable Tax purposes, have (i) filed all federal income and all
other Tax Returns required to be filed by applicable law and all such federal
income and other Tax Returns (A) reflect the liability for Taxes of the Company
and each of its subsidiaries except to the extent that a reserve for Taxes is
reflected on the balance sheet or the notes thereto including in the most recent
consolidated financial statements of the Company and its subsidiaries contained
in the Company SEC Reports, and (B) were filed on a timely basis and (ii) within
the time and in the manner prescribed by law, paid (and until the Closing Time
will pay within the time and in the manner prescribed by law) all Taxes that
were or are due and payable as set forth in such Tax Returns.
(c) Each of the Company and, where applicable, the Company's subsidiaries
has established (and until the Closing Time will maintain on at least a
quarterly basis) on its books and records reserves adequate to pay all Taxes of
the Company or such respective subsidiary, as the case may be, in accordance
with GAAP, which are reflected in the most recent consolidated financial
statements of the Company and its subsidiaries contained in the Company SEC
Reports, as applicable, to the extent required by GAAP.
(d) Except as disclosed in Section 3.13(d) of the Company Disclosure
Schedule, neither the Company nor any subsidiary thereof has requested any
extension of time within which to file any income, franchise or other Tax
Return, which Tax Return has not been filed as of the date hereof.
(e) Except as disclosed in Section 3.13(e) of the Company Disclosure
Schedule, neither the Company nor any subsidiary thereof has executed any
outstanding waivers or comparable consents regarding the application of the
statute of limitations with respect to any income, franchise or other Taxes or
Tax Returns.
(f) Except as disclosed in Section 3.13(f) of the Company Disclosure
Schedule, no deficiency for any Tax which, alone or in the aggregate with any
other deficiency or deficiencies, would exceed $250,000, has been proposed in
writing, asserted in writing, or assessed against the Company and/or any
subsidiary thereof that has not been resolved and paid in full or otherwise
settled, no audits or other administrative proceedings are presently in progress
or, to the Company's Knowledge, pending, or threatened in writing with regard to
any Taxes or Tax Returns of the Company and/or any subsidiary thereof, and no
written claim is currently being made by any authority in a jurisdiction where
any of the Company or any subsidiary thereof, as the case may be, does not file
Tax Returns that it is or may be subject to Tax in that jurisdiction.
(g) Except as disclosed on Section 3.13(g) of the Company Disclosure
Schedule, neither the Company nor any of its subsidiaries is a party to any
agreement relating to allocating or sharing of the payment of, or liability for,
Taxes except an agreement between or among solely the Company and one or more of
such subsidiaries or between such subsidiaries.
(h) The Company does not constitute and for the past five years has not
constituted a "United States real property holding corporation" within the
meaning of Section 897(c)(2) of the Code.
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SECTION 3.14. PROPERTIES. Section 3.14 of the Company Disclosure Schedule
contains a true and complete list (identifying the relevant owners, lessors and
lessees) of all real properties owned by the Company or any of its subsidiaries.
Each of the Company and its subsidiaries has good and marketable title to all
properties, assets and rights of any kind whatsoever (whether real, personal or
mixed, and whether tangible or intangible) owned by it (collectively, the
"Company Real Assets"), in each case free and clear of any material mortgage,
security interest, deed of trust, claim, charge, title defect or other lien or
encumbrance, except (a) as shown on the consolidated balance sheet of the
Company and its subsidiaries dated December 31, 1998 and the notes thereto, (b)
for any mortgage, security interest, deed of trust, claim, charge, title defect
or other lien or encumbrance arising by reason of (i) taxes, assessments or
governmental charges not yet delinquent or which are being contested in good
faith, (ii) deposits to secure public or statutory obligations in lieu of surety
or appeal bonds entered into in the ordinary course of business, (iii) operation
of law in favor of carriers, warehousemen, landlords, mechanics, materialmen,
laborers, employees or suppliers, incurred in the ordinary course of business
for sums which are not yet delinquent or are being contested in good faith by
negotiations or by appropriate proceedings which suspend the collection thereof
and (iv) matters of public record not having a material adverse effect in the
use or marketability of the Company Real Assets ("Permitted Liens"), or (c) as
set forth on Section 3.14 of the Company Disclosure Schedule. There are no
pending or, to the Company's Knowledge, threatened condemnation proceedings
against or affecting any material Company Real Assets, and none of the material
Company Real Assets is subject to any commitment or other arrangement for its
sale to a third party outside the ordinary course of business.
SECTION 3.15. MATERIAL CONTRACTS AND COMMITMENTS.
(a) Section 3.15 of the Company Disclosure Schedule contains a true and
complete list of all of the following contracts, agreements and commitments,
whether oral or written ("Contracts"), to which the Company or any of its
subsidiaries is a party or by which any of them or any of their material Company
Real Assets is bound, as each such contract or commitment may have been amended,
modified or supplemented:
(i) all Contracts pursuant to which the Company or its subsidiaries
holds a leasehold interest in or otherwise has an economic interest in any
real property, other than property described in Section 3.14 of the Company
Disclosure Schedule;
(ii) all Contracts granting or obtaining a franchise or license to
utilize a brand name or other rights of a system providing sterilization
services, or granting or obtaining a license or sublicense of any material
trademark, trade name, copyright, patent, service mark, or trade secret, or
any rights therein or application therefor other than for contracts related
to packaged software for the Company's internal use;
(iii) all partnership or joint venture Contracts;
(iv) all loan agreements, notes, bonds, debentures, debt instruments,
evidences of indebtedness, debt securities, or other Contracts relating to
any indebtedness of the Company or any of its subsidiaries in an amount in
excess of $250,000, or involving the direct or indirect guaranty or
suretyship by the Company or any of its subsidiaries of any indebtedness in
an amount in excess of $250,000;
(v) all Contracts that, after the date hereof, obligate the Company or
any of its subsidiaries to pay, pledge, or encumber or restrict assets in an
aggregate amount in excess of $250,000, except with respect to such
Contracts entered into in connection with facilities currently under
construction in which case such excess amount shall be $1,000,000;
(vi) all Contracts by which the Company has committed to extend credit
to third parties other than Contracts entered into with customers in the
ordinary course of business;
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(vii) all Contracts with the 25 largest (based on revenue paid to the
Company) customers of the Company during the fiscal year ended March 31,
1999; and
(viii) all Contracts that limit or restrict the ability of the Company
or any of its subsidiaries to compete or otherwise to conduct business in
any material manner or place.
(b) The Company has heretofore made available to the Parent true and
complete copies of all of the Contracts required to be set forth in Section 3.15
of the Company Disclosure Schedule except those required by Section 3.15(vii)
which will be provided to Parent as soon as is practicable after the date
hereof. Each such Contract is valid and binding in accordance with its terms,
and is in full force and effect (except as set forth in Section 3.15 of the
Company Disclosure Schedule), provided that foregoing representation is to the
Company's Knowledge with respect to the other parties to such Contracts. Neither
the Company nor any of its subsidiaries is in default in any material respect
with respect to any such Contract, nor does any condition exist that with notice
or lapse of time or both would constitute such a material default thereunder or
permit any other party thereto to terminate such Contract. To the Company's
Knowledge, no other party to any such Contract is in default in any material
respect with respect to any such Contract. No party has given any written notice
(i) of termination or cancellation of any such Contract or (ii) that it intends
to assert a breach of any such Contract, whether as a result of the transactions
contemplated hereby or otherwise. Each Contract identified in Section 3.15 of
the Company Disclosure Schedule in response to any item under this Section 3.15
shall be deemed incorporated by reference to all other items in this Section
3.15.
SECTION 3.16. INTANGIBLE PROPERTY.
(a) The Company has made available to the Parent a list of the Intangible
Property (as defined below) which is material to the Company and its
subsidiaries in which the Company or any of its subsidiaries has an interest.
(b) Except as set forth on Section 3.16 of the Company Disclosure Schedule:
(i) the Company and its subsidiaries own or have the right to use, all
material Intangible Property used in the conduct of their business as
presently conducted;
(ii) the Company and its subsidiaries have performed all material
obligations required to be performed by them, and are not in default under
any material contract or arrangement relating to any material Intangible
Property;
(iii) the execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby will not breach,
violate or conflict with any agreement related to any material Intangible
Property, will not cause the forfeiture or termination or give rise to a
right of forfeiture or termination of, or in any material way impair the
right of the Company or any of its subsidiaries to use, sell, license or
dispose of or to bring any action for the infringement of, any material
Intangible Property or material portion thereof;
(iv) there are no royalties, honoraria, fees or other payments payable
by the Company or any of its subsidiaries to any person by reason of the
ownership, use, license, sale or disposition of any material Intangible
Property;
(v) the conduct of the business by the Company and its subsidiaries does
not violate any material license or agreement with any third party; and
(vi) neither the Company nor any of its subsidiaries has received any
notice to the effect (or is otherwise aware) that any material Intangible
Property or the use thereof by the Company or any of its subsidiaries
conflicts with any rights of any person.
(c) As used herein "Intangible Property" means all patents, patent
applications (pending or otherwise), material internally developed (including by
third parties) computer software, registered copyrights,
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and currently used brand names, service marks, trademarks, tradenames, and all
registrations or applications for registration of any of the foregoing.
SECTION 3.17. BROKERS. No broker, finder or investment banker (other than
PaineWebber Incorporated, TM Capital Corp. and SG Cowen Securities Corporation,
the Company's financial advisers, a true and correct copy of whose entire
engagement agreements have been provided to Parent) is entitled to any
brokerage, finder's or other fee or commission in connection with the
transactions contemplated by this Agreement based upon arrangements made by or
on behalf of the Company.
SECTION 3.18. CERTAIN BUSINESS PRACTICES. None of the Company, any of its
subsidiaries or any directors or officers of the Company or any of its
subsidiaries (provided that as to the directors and officers of the Company's
Thailand subsidiary such representation is made to the Company's Knowledge), nor
to the Company's Knowledge, agents or employees of the Company or any of its
subsidiaries, has (a) used any funds for unlawful contributions, gifts,
entertainment or other unlawful expenses related to political activity, (b) made
any unlawful payment to foreign or domestic government officials or employees or
to foreign or domestic political parties or campaigns or violated any provision
of the Foreign Corrupt Practices Act of 1977, as amended, or (c) made any other
unlawful payment.
SECTION 3.19 APPLICABILITY OF STATE TAKEOVER STATUTES. The Section 203
Approval is valid and in full force and effect. Section 203 of the DGCL will not
apply to this Agreement, the Stockholders Agreement, the Offer or the
acquisition of shares pursuant to the Offer or the Stockholders Agreement or the
Merger. No other state takeover statute or similar statute or regulation applies
or purports to apply to this Agreement, the Stockholders Agreement, the Offer,
Merger or the other transactions contemplated hereby or thereby.
SECTION 3.20 AMENDMENT TO THE RIGHTS AGREEMENT. The Company's Board of
Directors has taken all necessary action (including any amendment thereof) under
the Rights Agreement so that (x) none of the execution or delivery of this
Agreement, or the Stockholders Agreement, consummation of the Offer, or any of
the other transactions contemplated hereby or thereby will cause (i) the Rights
to become exercisable under the Rights Agreement, (ii) Parent, GP or Acquisition
to be deemed an "Acquiring Person"(as defined in the Rights Agreement), or (iii)
the "Distribution Date" (as defined in the Rights Agreement) to occur upon any
such event and (y) the "Expiration Date"(as defined in the Rights Agreement) of
the Rights shall occur immediately prior to the Effective Time.
SECTION 3.21 OPINION OF FINANCIAL ADVISOR. The Company has received the
opinion of PaineWebber Incorporated and TM Capital Corp. to the effect that, as
of the date of this Agreement, the consideration to be received in the Offer and
the Merger by the Company's stockholders is fair to the Company's stockholders
from a financial point of view, and a complete and correct signed copy of such
opinion has been, or promptly upon receipt thereof will be, delivered to Parent.
The Company has been authorized by PaineWebber Incorporated and TM Capital Corp.
to permit the inclusion of such opinion in its entirety in the Offer Documents
and the Schedule 14D-9 and the Proxy Statement, so long as such inclusion is in
form and substance reasonably satisfactory to PaineWebber Incorporated and TM
Capital Corp. and its counsel.
SECTION 3.22 EMPLOYEES. Section 3.22 of the Company Disclosure Schedule sets
forth the following information concerning each employee of the Company whose
base annual salary is in excess of $50,000: (a) name; (b) position; (c) current
base salary; and (d) whether such employee has an employment agreement and, if
so, its expiration date.
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ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF PARENT AND ACQUISITION
Parent and Acquisition hereby represent and warrant to the Company as
follows:
SECTION 4.1. ORGANIZATION.
(a) Parent is a corporation duly organized, validly existing and in good
standing under the laws of the Kingdom of Belgium, GP is a general partnership
duly organized, validly existing and in good standing under the laws of the
State of Delaware and Acquisition is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware, and each
has all requisite power and authority to own, lease and operate its properties
and to carry on its businesses as now being conducted. Each of Parent and
Acquisition has heretofore delivered to the Company accurate and complete copies
of its Certificates of Incorporation and Bylaws as currently in effect.
(b) Each of Parent, GP and Acquisition is duly qualified or licensed and in
good standing to do business in each jurisdiction in which the property owned,
leased or operated by it or the nature of the business conducted by it makes
such qualification or licensing necessary, except in such jurisdictions where
the failure to be so duly qualified or licensed and in good standing would not
have a Parent Material Adverse Effect. The term "Parent Material Adverse Effect"
means any change or effect that is (i) materially adverse to the business,
results of operations, condition (financial or otherwise) or prospects of Parent
and its subsidiaries, taken as a whole, other than any change or effect arising
out of general economic conditions or (ii) that may impair the ability of
Parent, GP and/or Acquisition to consummate the transactions contemplated
hereby.
SECTION 4.2. AUTHORITY RELATIVE TO THIS AGREEMENT. Each of Parent, GP and
Acquisition has all necessary corporate power and authority to execute and
deliver this Agreement and to consummate the transactions contemplated hereby.
The execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby have been duly and validly authorized by the
boards of directors of Parent and Acquisition and the partners of GP and by GP
as the sole stockholder of Acquisition and no other corporate proceedings on the
part of Parent, GP or Acquisition are necessary to authorize this Agreement or
to consummate the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by each of Parent, GP and Acquisition and
constitutes a valid, legal and binding agreement of each of Parent, GP and
Acquisition enforceable against each of Parent, GP and Acquisition in accordance
with its terms, except as such enforceability may be limited by any applicable
bankruptcy, insolvency, reorganization, moratorium or other similar laws
affecting the enforcement of creditors' rights generally, and except as the
availability of equitable remedies may be limited by the application of general
principles of equity (regardless of whether such equitable principles are
applied in a proceeding at law or in equity).
SECTION 4.3. INFORMATION SUPPLIED. Neither the Schedule 14D-1, nor any of
the information supplied or to be supplied by Parent, GP or Acquisition for
inclusion or incorporation by reference in any of the other Disclosure
Statements will, at the respective times that the Proxy Statement (if necessary)
and the Schedule 14D-9 and any amendments thereof or supplements thereto are
filed with the SEC and are first published or sent or given to holders of
Shares, and in the case of any required Proxy Statement, at the time that it or
any amendment thereof or supplement thereto is mailed to the Company's
stockholders or, at the time of the Stockholders' Meeting, if such is required,
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.
SECTION 4.4. FINANCING. Parent has or has available to it, and will make
available to Acquisition, all funds necessary to satisfy all of Parent's and
Acquisition's obligations under this Agreement and in connection with the
transactions contemplated hereby including without limitation, sufficient funds
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available to purchase all of the Shares that Parent agrees, subject to the terms
and conditions hereof, to purchase hereunder and to pay all related fees and
expenses.
SECTION 4.5. CONSENTS AND APPROVALS; NO VIOLATIONS. Except for filings,
permits, authorizations, consents and approvals as may be required under, and
other applicable requirements of, the Securities Act, the Exchange Act, Blue Sky
Laws, the HSR Act and the securities or antitrust laws of any country other than
the United States, and the filing and acceptance for record of the Merger
Certificate as required by the DGCL, respectively, no filing with or notice to,
and no permit, authorization, consent or approval of, any Governmental Entity is
necessary for the execution and delivery by Parent, GP or Acquisition of this
Agreement or the consummation by Parent, GP or Acquisition of the transactions
contemplated hereby, except where the failure to obtain such permits,
authorizations, consents or approvals or to make such filings or give such
notice would not have a Parent Material Adverse Effect. Neither the execution,
delivery and performance of this Agreement by Parent, GP or Acquisition nor the
consummation by Parent, GP or Acquisition of the transactions contemplated
hereby will (i) conflict with or result in any breach of any provision of the
respective Certificates of Incorporation or Bylaws (or similar governing
documents) of Parent or Acquisition or the partnership agreement of GP, (ii)
result in a violation or breach of or constitute (with or without due notice or
lapse of time or both) a default (or give rise to any right of termination,
amendment, cancellation or acceleration or Lien) under any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, lease, license,
contract, agreement or other instrument or obligation to which Parent, GP or
Acquisition or any of Parent's other subsidiaries is a party or by which any of
them or any of their respective properties or assets may be bound or (iii)
violate any order, writ, injunction, decree, law, statute, rule or regulation
applicable to Parent, GP or Acquisition or any of Parent's other subsidiaries or
any of their respective properties or assets except, in the case of (ii) or
(iii), for violations, breaches or defaults which would not have a Parent
Material Adverse Effect.
ARTICLE 5
COVENANTS
SECTION 5.1. INTERIM OPERATIONS. From the date of this Agreement until the
Closing Time, except as set forth in Section 5.1 of the Company Disclosure
Schedule or as expressly contemplated by any other provision of this Agreement,
unless the Parent has consented in writing thereto, the Company shall, and shall
cause each of its subsidiaries to:
(a) conduct its business and operations only in the ordinary course of
business consistent with past practice;
(b) use reasonable efforts to preserve intact the business,
organization, goodwill, rights, licenses, permits and franchises of the
Company and its subsidiaries and maintain their existing relationships with
customers, suppliers and other persons having business dealings with them,
the loss of any of which would be reasonably likely to result in a Material
Adverse Effect on the Company;
(c) use reasonable efforts to keep in full force and effect adequate
insurance coverage and maintain and keep its properties and assets in good
repair, working order and condition, normal wear and tear excepted;
(d) not amend or modify its respective charter or certificate of
incorporation, by-laws, or other charter or organization documents;
(e) not authorize for issuance, issue, sell, grant, deliver, pledge or
encumber or agree or commit to issue, sell, grant, deliver, pledge or
encumber any shares of any class or series of capital stock of the Company
or any of its subsidiaries or any other equity or voting security or equity
or voting interest in the Company or any of its subsidiaries, any securities
convertible into or exercisable or exchangeable for any such shares,
securities or interests, or any options, warrants, calls, commitments,
subscriptions or rights to purchase or acquire any such shares, securities
or interests (other than issuances of Shares
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upon exercise of Company Stock Options granted prior to the date of this
Agreement and disclosed pursuant to Section 3.2 to directors, officers,
employees and consultants of the Company in accordance with the Company
Option Plans as currently in effect);
(f) not (i) split, combine or reclassify any shares of its stock or
issue or authorize or propose the issuance of any other securities in
respect of, in lieu of, or in substitution for, shares of its stock, (ii) in
solely the case of the Company, declare, set aside or pay any dividends on,
or make other distributions in respect of, any of the Company's stock, or
(iii) repurchase, redeem or otherwise acquire, or agree or commit to
repurchase, redeem or otherwise acquire, any shares of stock or other equity
or debt securities or equity interests of the Company or any of its
subsidiaries;
(g) not amend or otherwise modify the terms of any Company Stock Options
or the Company Option Plans, the effect of which shall be to make such terms
more favorable to the holders thereof or persons eligible for participation
therein;
(h) other than regularly scheduled seniority increases in the ordinary
course of business consistent with past practice, not increase the
compensation payable or to become payable to any directors, officers or
employees of the Company or any of its subsidiaries, or grant any severance
or termination pay to, or enter into any employment or severance agreement
with any director or officer of the Company or any of its subsidiaries, or
establish, adopt, enter into or amend in any material respect or take action
to accelerate any material rights or benefits under any collective
bargaining, bonus, profit sharing, thrift, compensation, stock option,
restricted stock, pension, retirement, deferred compensation, employment,
termination, severance or other plan, agreement, trust, fund, policy or
arrangement for the benefit of any director, officer or employee of the
Company of any of its subsidiaries;
(i) not acquire or agree to acquire (including, without limitation, by
merger, consolidation, or acquisition of stock, equity securities or
interests, or assets) any corporation, partnership, joint venture,
association or other business organization or division thereof or otherwise
acquire or agree to acquire any assets of any other person outside the
ordinary course of business consistent with past practice or any interest in
any real properties (whether or not in the ordinary course of business);
(j) not incur, assume or guarantee any indebtedness for borrowed money
(including draw-downs on letters or lines of credit) or issue or sell any
notes, bonds, debentures, debt instruments, evidences of indebtedness or
other debt securities of the Company or any of its subsidiaries or any
options, warrants or rights to purchase or acquire any of the same, except
for (i) renewals of existing bonds and letters of credit in the ordinary
course of business not to exceed $1,000,000 in the aggregate; and (ii)
advances, loans or other indebtedness in the ordinary course of business
consistent with past practice in an aggregate amount not to exceed
$1,000,000;
(k) not sell, lease, license, encumber or otherwise dispose of, or agree
to sell, lease, license, encumber or otherwise dispose of, any material
properties or assets of the Company and its subsidiaries taken as a whole;
(l) not authorize or make any capital expenditures (including by lease)
in excess of $1,000,000 in the aggregate for the Company and all of its
subsidiaries;
(m) not make any material change in any of its accounting or financial
reporting (including tax accounting and reporting) methods, principles or
practices, except as may be required by GAAP or applicable tax laws;
(n) not make any material tax election or settle or compromise any
material United States or foreign tax liability;
(o) except in the ordinary course of business consistent with past
practice, not amend, modify or terminate any Contract required to be listed
in Section 3.15 of the Company Disclosure Schedule or waive, release or
assign any material rights or claims thereunder;
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(p) not adopt a plan of complete or partial liquidation, dissolution,
merger, consolidation, restructuring, recapitalization or other
reorganization of the Company or any of its subsidiaries; and
(q) except as to subsections (a), (b) and (c) of this Section 5.1, not
agree or commit in writing or otherwise to do any of the foregoing.
SECTION 5.2. STOCKHOLDERS' MEETING.
(a) The Company, acting through the Board, shall, if required for the
Merger under the DGCL:
(i) duly call, give notice of, convene and hold a meeting of its
stockholders (the "Stockholders' Meeting"), to be held as soon as
practicable after the Tender Offer Purchase Time for the purpose of
considering and taking action upon this Agreement;
(ii) except as otherwise permitted under Section 5.3, include in the
Proxy Statement (A) the recommendation of the Board that stockholders of
the Company vote in favor of the approval and adoption of this Agreement,
the Merger and the other transactions contemplated hereby, and (B) a
statement that the Board believes that the consideration to be received
by the stockholders of the Company pursuant to the Merger is fair to such
stockholders;
(iii) except as otherwise permitted under Section 5.3, use reasonable
efforts (A) to obtain and furnish the information required to be included
by it in the Disclosure Statements and, after consultation with Parent
and providing Parent with a reasonable opportunity to review and comment
upon the Proxy Statement, cause the Proxy Statement to be mailed to its
stockholders at the earliest practicable time following the Tender Offer
Purchase Time, and (B) to obtain the necessary approvals by its
stockholders of this Agreement and the transactions contemplated hereby.
At such meeting, Parent, GP and Acquisition will, and will cause their
affiliates to, vote all Shares owned by them in favor of approval and
adoption of this Agreement, the Merger and the transactions contemplated
hereby.
SECTION 5.3. OTHER POTENTIAL ACQUIRERS.
(a) From and after the date of this Agreement until the earlier of the
Effective Time or termination of this Agreement pursuant to its terms, the
Company and its subsidiaries shall not, and will instruct their respective
directors, officers, employees, representatives, investment bankers, agents
and affiliates not to, directly or indirectly, (i) solicit or encourage
submission of, any inquiries, proposals or offers by any person, entity or
group (other than Parent and its affiliates, agents and representatives), or
(ii) participate in any discussions or negotiations with, or disclose any
non-public information concerning the Company or any of its subsidiaries to,
or afford any access to the properties, books or records of the Company or
any of its subsidiaries to, or otherwise assist or facilitate, or enter into
or resolve to enter into any agreement or understanding with, any person,
entity or group (other than Parent and its affiliates, agents and
representatives), in connection with any Acquisition Proposal with respect
to the Company. For the purposes of this Agreement, an "Acquisition
Proposal" with respect to an entity means any proposal or offer relating to
(i) any merger, consolidation, sale of substantial assets or similar
transactions involving the entity or any subsidiaries of the entity (other
than sales of assets or inventory in the ordinary course of business or as
permitted under the terms of this Agreement), (ii) the acquisition by any
person of beneficial ownership or a right to acquire beneficial ownership
of, or the formation of any "group" (as defined under Section 13(d) of the
Exchange Act and the rules and regulations thereunder) which beneficially
owns, or has the right to acquire beneficial ownership of, 10% or more of
the then outstanding shares of capital stock of the entity (except for
acquisitions for passive investment purposes only in circumstances where the
person or group qualifies for and files a Schedule 13G with respect
thereto); (iii) the adoption by the entity of a plan of liquidation or the
declaration or payment of an extraordinary dividend; (iv) the repurchase by
the entity of more than 20% of its outstanding shares of voting stock; (v)
the acquisition by the entity of direct or indirect ownership of a business
where
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annual revenue, net income or assets is greater than 20% of the entity; or
(vi) any public announcement of a proposal, plan or intention to do any of
the foregoing or any agreement to engage in any of the foregoing. The
Company will, and will cause its subsidiaries and their respective
directors, officers, employees, representatives and agents, to immediately
cease any and all existing activities, discussions or negotiations with any
parties conducted heretofore with respect to any of the foregoing. The
Company will (i) notify Parent as promptly as practicable if any inquiry or
proposal is made or any information or access is requested in connection
with an Acquisition Proposal or potential Acquisition Proposal and (ii) as
promptly as practicable notify Parent of the terms and conditions of any
such Acquisition Proposal. In addition, subject to the other provisions of
this Section 5.3(a), from and after the date of this Agreement until the
earlier of the Effective Time and termination of this Agreement pursuant to
its terms, the Company and its subsidiaries will not, and will instruct
their respective directors, officers, employees, representatives, investment
bankers, agents and affiliates not to, directly or indirectly, make or
authorize any public statement, recommendation or solicitation in support of
any Acquisition Proposal made by any person, entity or group (other than
Parent or Acquisition); PROVIDED, HOWEVER, that nothing herein shall
prohibit the Company's Board of Directors from taking and disclosing to the
Company's stockholders a position with respect to a tender offer pursuant to
Rules 14d-9 and 14e-2 promulgated under the Exchange Act.
(b) Except as allowed under Section 5.3(b), the Board will not withdraw
or modify in a manner adverse to Parent or Acquisition its recommendation of
the transactions contemplated hereby or approve or recommend any Acquisition
Proposal. Notwithstanding the provisions of paragraph (a) above, prior to
consummation of the Offer, the Company may, to the extent the Board of
Directors of the Company determines, in good faith, after consultation with
outside legal counsel, that the Board's fiduciary duties under applicable
law require it to do so, participate in discussions or negotiations with,
and, subject to the requirements of paragraph (c), below, furnish
information to any person, entity or group after such person, entity or
group has delivered to the Company in writing, an unsolicited bona fide
Acquisition Proposal which the Board of Directors of the Company in its good
faith reasonable judgment determines, after consultation with its
independent financial advisors, would result in a transaction more favorable
than the Offer and the Merger to the stockholders of the Company from a
financial point of view and for which financing, to the extent required, is
then committed or which, in the good faith reasonable judgement of the Board
of Directors of the Company (based upon the advice of independent financial
advisors) is reasonably capable of being financed by such person, entity or
group and which is likely to be consummated (a "Superior Proposal"). In the
event the Company receives a Superior Proposal nothing contained in this
Agreement (but subject to the terms hereof) will prevent the Board of
Directors of the Company from recommending such Superior Proposal to the
Company's stockholders, if the Board determines, in good faith, after
consultation with outside legal counsel, that such action is required by its
fiduciary duties under applicable law, PROVIDED, HOWEVER, that the Company
shall not recommend to its stockholders a Superior Proposal for a period of
not less than 72 hours after Parent's receipt of a copy of such Superior
Proposal (or a description of the terms and conditions thereof, if not in
writing).
(c) Notwithstanding anything to the contrary herein, the Company will
not provide any nonpublic information to a third party unless: (x) the
Company provides such nonpublic information pursuant to a nondisclosure
agreement with terms regarding the protection of confidential information at
least as restrictive as such terms in the Confidentiality Agreement (as
defined below); and (y) such nonpublic information has been previously
delivered to Parent.
SECTION 5.4 [INTENTIONALLY OMITTED]. .
SECTION 5.5 ACCESS TO INFORMATION. From the date of this Agreement until
the Closing Time, upon reasonable prior notice, the Company shall (and shall
cause each of its subsidiaries to) give the Parent and its representatives
(including lenders to and financing sources for such party) full access to the
officers, employees, agents, books, records, contracts, commitments, properties,
offices and other facilities
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of it and its subsidiaries, and shall furnish promptly to the Parent and its
representatives such financial and operating data and other information
concerning the business, operations, properties, contracts, records and
personnel of the Company and its subsidiaries as the Parent may from time to
time reasonably request. Parent and Acquisition will make all reasonable efforts
to minimize any disruption to the businesses of the Company and its subsidiaries
which may result from the access to properties and employees and for data and
information hereunder. All information obtained by the Parent pursuant to this
Section 5.5 shall be kept confidential in accordance with the confidentiality
provisions of the Non-Disclosure Agreement between Parent and the Company dated
May 17, 1999 (the "Confidentiality Agreement"). No representations and
warranties or conditions to the consummation of the Merger contained herein or
in any certificate or instrument delivered in connection herewith shall be
deemed waived or otherwise affected by any investigation made by the parties or
their respective representatives.
SECTION 5.6. FURTHER ACTIONS.
(a) Each of the parties hereto shall use its best efforts to take, or
cause to be taken, all actions, and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and regulations, and
consult and fully cooperate with and provide reasonable assistance to each
other party hereto and their respective representatives in order, to
consummate and make effective the transactions contemplated by this
Agreement as promptly as practicable hereafter, including, without
limitation, (i) using reasonable efforts to make all filings, applications,
notifications, reports, submissions and registrations with, and to obtain
all consents, approvals, authorizations or permits of, Governmental Entities
or other persons or entities as are necessary for the consummation of the
Merger and the other transactions contemplated hereby (including, without
limitation, pursuant to the HSR Act, the Securities Act, the Exchange Act,
Blue Sky Laws, Delaware law and other applicable laws and regulations in
effect in the United States, Belgium or any other jurisdiction), and (ii)
taking such actions and doing such things as any other party hereto may
reasonably request in order to cause any of the conditions to such other
party's obligation to consummate the Merger as specified in Article 8 of
this Agreement to be fully satisfied. Prior to making any application to or
filing with any Governmental Entity or other person or entity in connection
with this Agreement, the Company, on the one hand, and the Parent, on the
other hand, shall provide the other with drafts thereof and afford the other
a reasonable opportunity to comment on such drafts.
(b) Without limiting the generality of the foregoing, each of the Parent
and the Company agree to cooperate and use reasonable efforts to vigorously
contest and resist any action, suit, proceeding or claim, and to have
vacated, lifted, reversed or overturned any injunction, order, judgment or
decree (whether temporary, preliminary or permanent), that delays, prevents
or otherwise restricts the consummation of the Merger or any other
transaction contemplated by this Agreement, and to take any and all actions
(including, without limitation, the disposition of assets, divestiture of
businesses, or the withdrawal from doing business in particular
jurisdictions) as may be required by Governmental Entities as a condition to
the granting of any such necessary approvals or as may be required to avoid,
vacate, lift, reverse or overturn any injunction, order, judgment, decree or
regulatory action; PROVIDED, HOWEVER, that in no event shall any party
hereto take, or be required to take, any action that could reasonably be
expected to have a Material Adverse Effect on the Company or that
individually or in the aggregate could reasonably be expected to have a
Parent Material Effect.
SECTION 5.7. HSR MATTERS. Each party hereto shall make an appropriate
filing of a Notification and Report Form pursuant to the HSR Act with respect to
the transactions contemplated hereby as promptly as practicable after the date
hereof. Each such filing shall request early termination of the waiting periods
imposed by the HSR Act. Each party hereby agrees to use its reasonable best
efforts to cause a termination of the waiting period under the HSR Act without
the entry by a court of competent jurisdiction of an order enjoining the
consummation of the transactions contemplated hereby at as early a date as
possible. Each party also agrees to respond promptly to all investigatory
requests as may be made by the government. In the event that a Request for
Additional Information is issued under the HSR Act,
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each party agrees to furnish all information required and to comply
substantially with such request as soon as is practicable after its receipt
thereof so that any additional applicable waiting period under the HSR Act may
commence. Each party will keep the other party apprised of the status of any
inquiries made of such party by the Department of Justice, Federal Trade
Commission or any other governmental agency or authority or members of their
respective staffs with respect to this Agreement or the transactions
contemplated hereby.
SECTION 5.8. PUBLIC ANNOUNCEMENTS. Parent, Acquisition and the Company, as
the case may be, will consult with one another before issuing any press release
or otherwise making any public statements with respect to the transactions
contemplated by this Agreement, including, without limitation, the Merger, and
shall not issue any such press release or make any such public statement prior
to such consultation except to the extent that such consultation may be
prohibited by applicable law or such a disclosure or release is required by
obligations pursuant to any listing agreement with the Brussels Stock Exchange
or Nasdaq as determined by Parent or the Company, as the case may be.
SECTION 5.9. EMPLOYEE BENEFIT MATTERS; COMPANY STOCK OPTIONS. The Company
shall, or shall cause one of its subsidiaries to, take such action effective as
of the Effective Time with respect to any Company Employee Plan as Parent shall
reasonably request, including termination of any such plan. The Company shall
(a) cooperate with Parent and Acquisition in obtaining waivers, in form and
substance reasonably satisfactory to Parent and Acquisition, of all terms of the
Company Option Plans and all terms of outstanding Company Stock Options, which
terms could prevent, restrict or impair the ability of Parent, Acquisition and
the Company to effectuate fully the provisions of Section 2.10, and (b) use
reasonable efforts to cause its Compensation Committee to interpret the Company
Option Plan, to the extent possible, so as to enable the Company, Parent and
Acquisition to effectuate fully the provisions of Section 2.10.
SECTION 5.10. NOTIFICATION OF CERTAIN MATTERS. The Company shall give
prompt notice to Parent and Parent shall give prompt notice to the Company, of
(i) the occurrence or nonoccurrence of any event the occurrence or nonoccurrence
of which would be likely to cause (A) any representation or warranty contained
in this Agreement to be untrue or inaccurate in any material respect at or prior
to the Effective Time or (B) any covenant, condition or agreement contained in
this Agreement not to be complied with or satisfied in all material respects and
(ii) any material failure of the Company, Parent, GP or Acquisition, as the case
may be, to comply with or satisfy any covenant, condition or agreement to be
complied with or satisfied by it hereunder; PROVIDED, HOWEVER, that the delivery
of any notice pursuant to this Section 5.10 shall not cure such breach or
non-compliance or limit or otherwise affect the remedies available hereunder to
the party receiving such notice.
SECTION 5.11. GUARANTEE OF PERFORMANCE. Parent hereby guarantees the
performance by Acquisition and GP of their obligations under this Agreement.
SECTION 5.12 INDEMNIFICATION; DIRECTORS' AND OFFICERS' INSURANCE.
(a) Parent and Acquisition agree that all rights to indemnification for
acts or omissions occurring prior to the Effective Time now existing in
favor of the current or former directors or officers (the "Indemnified
Parties") of the Company and its subsidiaries as provided in their
respective certificates of incorporation or bylaws (or similar
organizational documents) or existing indemnification contracts shall
survive the Merger and shall continue in full force and effect in accordance
with their terms.
(b) For six years from the Effective Time, Parent shall maintain in
effect the Company's current directors' and officers' liability insurance or
insurance policies with substantially equivalent coverage covering those
persons who are currently covered by the Company's directors' and officers'
liability insurance policy (a copy of which has been heretofore delivered to
Parent).
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(c) This Section 5.12 shall survive the consummation of the Merger at
the Effective Time, is intended to benefit the Company, Parent, the
Acquisition and the Indemnified Parties, and shall be binding on all
successors and assigns of Parent and the Acquisition.
SECTION 5.13 STATE TAKEOVER LAWS. Notwithstanding any other provision of
this Agreement, in no event shall the Section 203 Approval be withdrawn, revoked
or modified by the Board. If any state takeover statute other than Section 203
of the DGCL becomes or is deemed to become applicable to the Offer, the
acquisition of the Shares pursuant to the Offer or the Stockholders Agreement or
the Merger, the Company shall take all action necessary to render such statute
inapplicable to all of the foregoing.
SECTION 5.14 EMPLOYEE BENEFITS. Following the Effective Time, the
Surviving Corporation will provide the persons employed by the Company
immediately prior to the Effective Time, for so long as such persons remain
employed by the Surviving Corporation with benefits (other than stock options)
in the aggregate which are substantially comparable to those provided to such
persons by the Company immediately prior to the Effective Time.
ARTICLE 6
DISSENTING SHARES; EXCHANGE OF SHARES
SECTION 6.1 DISSENTING SHARES. Notwithstanding anything in this Agreement
to the contrary, in the event that dissenters' rights are available in
connection with the Merger pursuant to Section 262 of the DGCL, Shares that are
issued and outstanding immediately prior to the Effective Time and that are held
by stockholders who did not vote in favor of the Merger and who comply with all
of the relevant provisions of Section 262 of the DGCL (the "Dissenting Shares")
shall not be converted into or be exchangeable for the right to receive the Cash
Merger Consideration, but instead shall be converted into the right to receive
such consideration as may be determined to be due to such stockholders pursuant
to Section 262 of the DGCL, unless and until such holders shall have failed to
perfect or shall have effectively withdrawn or lost their rights to appraisal
under the DGCL. If any such holder shall have failed to perfect or shall have
effectively withdrawn or lost such right, such holder's Shares shall thereupon
be deemed to have been converted into and to have become exchangeable for the
right to receive, as of the Effective Time, the Cash Merger Consideration
without any interest thereon. The Company shall give Parent (i) prompt notice of
any written demands for appraisal of Shares received by the Company and (ii) the
opportunity to participate in all negotiations and proceedings with respect to
any such demands. The Company shall not, without the prior written consent of
Parent, voluntarily make any payment with respect to, or settle or offer to
settle, any such demands.
ARTICLE 7
CONDITIONS TO THE OFFER
SECTION 7.1. CONDITIONS TO THE OFFER. (a) Notwithstanding any other
provisions of the Offer, Acquisition shall not be required to accept for payment
or, subject to any applicable rules and regulations of the SEC, including Rule
14e-l(c) under the Exchange Act (relating to Acquisition's obligation to pay for
or return tendered Shares promptly after termination or withdrawal of the
Offer), pay for, and may delay the acceptance for payment of or, subject to the
restrictions referred to above, the payment for, any tendered Shares, and may
amend the Offer consistent with the terms of this Agreement, including extending
the deadline for tendering Shares, or terminate the Offer, if any of the
following events shall occur:
(i) from the date of this Agreement until the Tender Offer Purchase
Time, there shall have occurred any change, event, occurrence or
circumstance which, individually or in the aggregate, has a Material Change
(as defined below) on the Company (except for changes, events, occurrences
or circumstances with respect to general economic conditions). "Material
Change" means any change or
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effect that is materially adverse to the business, properties or financial
condition of the Company; PROVIDED, HOWEVER, that (x) the commencement of
any litigation against the Company or its subsidiaries after the date of
this Agreement which is related to this Agreement or the transactions
contemplated hereby or any adverse change, event or effect that is
proximately caused by such litigation that is initiated or threatened after
the date of this Agreement against the Company or any of its subsidiaries
and (y) any adverse change resulting from any action taken by the Company
that was approved by Parent under Section 5.1 of this Agreement shall not be
a Material Change; and PROVIDED FURTHER, HOWEVER, that if the Offer is
consummated after July 31, 1999 the following shall not be taken into
account in determining whether there has been or would be a Material Change
with respect to the Company to the extent such events occur subsequent to
July 31, 1999:
(a) a reduction of up to 25% of the (i) average monthly consolidated
revenue and net profit of the Company compared to the average monthly
consolidated revenue and net profit of the Company during the 12 months
immediately preceding the date of this Agreement or (ii) the net worth of
the Company compared to the December 31, 1998 balance sheet;
(b) any change in the assets of the Company in connection with
obtaining required regulatory approvals; or
(c) any voluntary termination after the date of this Agreement of
officers or other key employees of the Company;
(ii) from the date of this Agreement until the Tender Offer Purchase
Time, any Governmental Entity or court of competent jurisdiction shall have
enacted, issued, promulgated, enforced or entered any statute, rule,
regulation, executive order, decree, injunction or other order (and if
temporary or preliminary, not vacated within five (5) business days of its
entry), except with regard to HSR Act approval which shall be governed by
Section 7.1(a)(vii), which is in effect at the Tender Offer Purchase Time
and which (1) makes the acceptance for payment of, or the payment for, some
or all of the Shares illegal or otherwise prohibits or restricts
consummation of the Offer, the Merger or any of the other transactions
contemplated hereby, (2) imposes material limitations on the ability of
Parent, GP or Acquisition to acquire or hold or to exercise any rights of
ownership of the Shares, or effectively to manage or control the Company and
its business, assets and properties or (3) would result in a Material Change
to the Company; PROVIDED, HOWEVER, that the parties shall use reasonable
efforts (subject to the proviso in Section 5.6(b)) to cause any such decree,
judgment or other order to be vacated or lifted as soon as is practicable;
(iii) the representations and warranties of the Company set forth in
this Agreement shall not (A) have been true and correct in one or more
material respects on the date hereof or (B) (except with respect to the
representations and warranties set forth in Sections 3.8, 3.9, 3.14, 3.15,
3.22, 3.13(c), (d), (e), (f), (g) and (h) and 3.16(a), (b)(i), (ii), (iv),
(v) and (vi)) be true and correct in one or more material respects as of the
scheduled expiration date (as such date may be extended) of the Offer as
though made on and as of such date or the Company shall have breached or
failed in any respect to perform or comply with any material obligation,
agreement or covenant required by this Agreement to be performed or complied
with by it (including without limitation the provisions of Section 5.3)
except, in each case with respect to clause B, (1) for changes specifically
permitted by the Agreement and (2)(x) for those representations and
warranties that address matters only as of a particular date which are true
and correct as of such date or (y) where the failure of representations and
warranties (without regard to materiality qualifications therein contained)
to be true and correct, or the performance or compliance with such
obligations, agreements, or covenants, would not, individually or in the
aggregate, result in a Material Change to the Company;
(iv) from the date of this Agreement until the Tender Offer Purchase
Time, this Agreement shall have been terminated in accordance with its
terms;
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(v) from the date of this Agreement until the Tender Offer Purchase Time
the Board of Directors of the Company or any committee thereof shall have
(1) withdrawn or modified (including without limitation, by amendment of the
Company's Schedule 14D-9) in a manner adverse to Parent or Acquisition its
approval or recommendation of the Offer, the Merger or the Agreement, (2)
approved or recommended any Acquisition Proposal by a third party other than
the Offer and the Merger, (3) resolved to do any of the foregoing, or (4)
upon a request to reaffirm the Company's approval or recommendation of the
Offer, the Agreement or the Merger, the Board of Directors of the Company
shall fail to do so within two business days after such request is made;
(vi) from the date of this Agreement until the Tender Offer Purchase
Time, any of the consents, approvals, authorizations, orders or permits
required to be obtained by the Company, Parent, GP or Acquisition, or their
respective subsidiaries in connection with the Offer or the Merger from, or
filings or registrations required to be made by any of the same prior to the
Tender Offer Purchase Time with, any Governmental Entity in connection with
the execution, delivery and performance of this Agreement (including without
limitation the termination or expiration of any applicable waiting period or
the receipt of any required clearance under the HSR Act) shall not have been
obtained or made or shall have been obtained or made subject to conditions
or requirements, which (A) make the acceptance for payment of, or the
payment for the Shares illegal or otherwise prohibits or restricts the
consummation of the Offer or the Merger or (B) have a Parent Material
Adverse Effect or result in a Material Change to the Company or (C) impose
material limitations on the ability of Parent, GP or Acquisition effectively
to manage or control the Company;
(vii) from the date of this Agreement until the Tender Offer Purchase
Time, in the case of HSR Act approval, any Governmental Entity or court of
competent jurisdiction shall have entered a final, non-appealable order
enjoining the consummation of the Merger;
(viii) from the date of this Agreement until the Tender Offer Purchase
Time, there shall have occurred (A) the declaration of a banking moratorium
or any suspension of payments in respect of banks in the United States or in
Belgium or (B) the commencement of a war or armed hostilities involving the
United States or Belgium and resulting in a Material Change to the Company
or having a Parent Material Adverse Effect or materially adversely affecting
(or materially delaying) the consummation of the Offer.
(b) The conditions set forth in Section 7.1(a) are for the sole benefit of
Parent, GP and Acquisition and may be asserted by Parent regardless of any
circumstances giving rise to any condition and may be waived by Parent, in whole
or in part, at any time and from time to time, in the sole discretion of Parent.
The failure by Parent (or any affiliate of Parent) at any time to exercise any
of the foregoing rights will not be deemed a waiver of any right and each right
will be deemed an ongoing right which may be asserted at any time and from time
to time.
(c) Notwithstanding the foregoing, if within the "Cure Time" (defined below)
the Company has cured one or more conditions set forth in subsections (a)(i),
(ii), or (iii) of Section 7.1, and following such cure, no condition enumerated
in Section 7.1(a) continues to exist, then this Article shall not relieve
Parent, GP and Acquisition of their obligations hereunder with respect to the
Offer. For purposes hereof, "Cure Time" means the earlier of (A) two (2) full
business days before the scheduled expiration date of the Offer (as such period
may be extended) or (B) ten (10) full business days following notice to the
Company of the existence of such condition.
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ARTICLE 8
CONDITIONS TO CONSUMMATION OF THE MERGER
SECTION 8.1. CONDITIONS TO EACH PARTY'S OBLIGATIONS TO EFFECT THE
MERGER. The respective obligations of each party hereto to effect the Merger
are subject to the satisfaction at or prior to the Closing Time of the following
conditions:
(a) this Agreement, the Merger and the other transactions contemplated
hereby shall have been approved by all necessary corporate action of the
Company, including, if necessary, adoption by vote of the stockholders of the
Company;
(b) no Governmental Entity or court of competent jurisdiction shall have
enacted, issued, promulgated, enforced or entered any statute, rule, regulation,
executive order, decree, injunction or other order (and if temporary or
preliminary, not vacated within five business days of its entry) which is in
effect and which (1) makes the payment of the Cash Merger Consideration illegal
or otherwise prohibits or restricts consummation of the Merger or any of the
other applicable transactions contemplated hereby, or (2) imposes material
limitations on the ability of Parent, GP or Acquisition to acquire or hold or to
exercise any rights of ownership of the Surviving Corporation, or effectively to
manage or control the Surviving Corporation and its business, assets and
properties;
(c) any waiting period applicable to the Merger under the HSR Act shall have
terminated or expired and any other governmental or regulatory notices or
approvals required with respect to the transactions contemplated hereby shall
have been either filed or received; and
(d) Acquisition shall have purchased Shares pursuant to the Offer.
ARTICLE 9
TERMINATION; AMENDMENT; WAIVER
SECTION 9.1. TERMINATION. This Agreement may be terminated, at any time
prior to the Effective Time, whether before or after approval by the
stockholders of the Company:
(a) by mutual written agreement of the Boards of Directors of Parent and the
Company;
(b) by either Parent or the Company;
(i) if the Offer (as may be extended in accordance with the terms
hereof) shall be terminated or expire without any Shares having been
purchased pursuant to the Offer; PROVIDED, HOWEVER, that a party shall not
be entitled to terminate this Agreement pursuant to this Section 9.l(b)(i)
if it is in material breach of its representations and warranties, covenants
or other obligations under this Agreement; and PROVIDED, FURTHER, HOWEVER,
that if the Offer is not consummated due to a failure to obtain clearance
under the HSR Act, Parent may not terminate this Agreement until December
31, 1999 and the Company may not terminate this Agreement until April 1,
2000; or
(ii) if any court of competent jurisdiction in the United States or
other United States governmental body shall have issued an order, decree or
ruling or taken any other action restraining, enjoining or otherwise
prohibiting the Offer or the Merger and such order, decree, ruling or other
action shall have become final and nonappealable;
(c) by Parent:
(i) if the Board of Directors of the Company or any committee thereof
shall have approved, or recommended that stockholders of the Company accept
or approve, an Acquisition Proposal by a third party, or shall have resolved
to do any of the foregoing;
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(ii) if the Board of Directors of the Company or any committee thereof
shall have withdrawn or modified its approval of, or recommendation that the
stockholders of the Company accept or approve (as the case may be), the
Offer, this Agreement and the Merger, or shall have resolved to do any of
the foregoing;
(iii) if the Company shall have failed to include in the Schedule 14D-9
the recommendation of the Board of Directors of the Company that the
stockholders of the Company accept the Offer;
(iv) prior to the purchase of the Shares pursuant to the Offer, if the
Company is in material breach of any of its covenants or obligations under
this Agreement, or any representation or warranty of the Company contained
in this Agreement shall have been incorrect, in any material respect, when
made;
(v) prior to the purchase of Shares pursuant to the Offer, in the event
that the conditions to the Offer set forth in Section 7.1 shall not be
satisfied, provided, that Parent may not terminate this Agreement due to a
failure to obtain clearance under the HSR Act until December 31, 1999; or
(vi) after purchase of the Shares pursuant to the Offer, if the Company
is in violation or breach of Section 1.3.
(d) by the Company:
(i) if the Offer shall not have been commenced in accordance with
Section 1.1, or Parent or Acquisition shall have failed to purchase validly
tendered Shares in violation of the terms of the Offer within ten business
days after the expiration of the Offer; provided, however, that the Company
shall not be entitled to terminate this Agreement pursuant to this Section
9.1(d)(i) if it is in material breach of its representations and warranties,
covenants or other obligations under this Agreement;
(ii) if the Board of Directors of the Company has resolved to, and in
fact does, recommend to the Company's Stockholders that they accept a
Superior Proposal, provided that all the provisions of Section 5.3 have been
fully complied with and the Break-up Fee has been paid to Parent in
accordance with Section 9.3(b);
(iii) prior to the purchase of Shares pursuant to the Offer, if Parent
or Acquisition is in material breach of any of its covenants or obligations
under this Agreement, or any representation or warranty of Parent or
Purchaser contained in this Agreement shall have been incorrect, in any
material respect, when made; or
(iv) at any time after March 31, 2000 if the Offer has not been
consummated due to a failure to obtain clearance under the HSR Act;
PROVIDED, HOWEVER, that the Company shall not be entitled to terminate this
Agreement pursuant to this Section 9.1(d)(iv) if it is in material breach of
its representations and warranties, covenants or other obligations under
this Agreement.
SECTION 9.2. PROCEDURE AND EFFECT OF TERMINATION. In the event of the
termination of this Agreement by the Company or Parent or both of them pursuant
to Section 9.1, the terminating party shall provide written notice of such
termination to the other party and this Agreement shall forthwith become void
and there shall be no liability on the part of Parent, Purchaser or the Company,
except that the confidentiality provisions of Section 5.5, the first sentence of
Section 5.13, and Sections 9.2 and 9.3 shall survive the termination of this
Agreement. The foregoing shall not relieve any party for liability for damages
actually incurred as a result of any breach of this Agreement.
SECTION 9.3. FEES AND EXPENSES.
(a) Except as otherwise provided in this Agreement and whether or not the
transactions contemplated by the Offer and this Agreement are consummated, all
costs and expenses incurred in connection with the transactions contemplated by
the Offer and this Agreement shall be paid by the party incurring such expenses.
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(b) The Company shall pay to Parent, an amount equal to $7,500,000 (the
"Break-Up Fee"), if any of the following shall occur:
(i) if the Board of Directors of the Company or any committee thereof
shall have approved, or recommended that stockholders of the Company accept
or approve, an Acquisition Proposal by a third party, or shall have resolved
to do any of the foregoing;
(ii) if the Board of Directors of the Company or any committee thereof
shall have withdrawn or modified its approval of, or recommendation that the
stockholders of the Company accept or approve (as the case may be), the
Offer, this Agreement and the Merger, or shall have resolved to do any of
the foregoing; or
(iii) if the Company shall have failed to include in the Schedule 14D-9
the recommendation of the Board of Directors of the Company that the
stockholders of the Company accept the Offer.
Such Break-up Fee shall be payable within 30 days of such event.
(b) Parent shall pay to the Company the sum of $8,000,000 if the Offer has
not been consummated, and (i) Parent terminates this Agreement during the period
from December 31, 1999 through February 15, 2000 due to a failure to obtain
clearance under the HSR Act and (ii) Parent shall have refused to consent to any
divestiture by the Company required for clearance under the HSR Act.
(c) Parent shall pay to the Company the sum of $15,000,000 if the Offer has
not been consummated, and (i) Parent terminates the Agreement at any time after
February 15, 2000 due to a failure to obtain clearance under the HSR Act and
(ii) Parent shall have refused to consent to any divestiture by the Company
required for clearance under the HSR Act.
(d) Parent shall pay to the Company the sum of $15,000,000 if the Company
terminates the Agreement pursuant to Section 9.1(d)(iv) and Parent shall have
refused to consent to any divestiture by the Company required for clearance
under the HSR Act.
SECTION 9.4. AMENDMENT. This Agreement may be amended by each of the
parties by action taken by or on behalf of their respective Boards of Directors
at any time prior to the Effective Time; PROVIDED, HOWEVER, that (i) such
amendment shall be in writing signed by all of the parties, (ii) any such
waiver, amendment or supplement by the Company shall be effective as against the
Company only if approved by a majority of the Continuing Directors and (iii)
after adoption of this Agreement and the Merger by the stockholders of the
Company, no amendment may be made without the further approval of the
stockholders of the Company which reduces the Merger Consideration or changes
the form thereof or changes any other terms and conditions of this Agreement if
the changes, alone or in the aggregate, would materially adversely affect the
stockholders of the Company.
SECTION 9.5. WAIVER. At any time prior to the Effective Time, whether
before or after the Company's Stockholders Meeting, any party hereto, by action
taken by its Board of Directors, may (i) extend the time for the performance of
any of the obligations or other acts of any other party hereto or (ii) subject
to the provisions of Section 9.4, waive compliance with any of the agreements of
any other party or with any conditions to its own obligations. Any agreement on
the part of a party hereto to any such extension or waiver shall be valid only
if set forth in an instrument in writing signed on behalf of such party by a
duly authorized officer of such party. Notwithstanding the above, any waiver
given shall not apply to any subsequent failure of compliance with agreements of
the other party or conditions to its own obligations.
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ARTICLE 10
MISCELLANEOUS
SECTION 10.1. NONSURVIVAL OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties made herein shall not survive beyond the Tender
Offer Purchase Time or a termination of this Agreement; provided, however,that
this Section 10.1 shall not limit any covenant or agreement of the parties
hereto which by its terms requires performance after the Tender Offer Purchase
Time including, without limitation, the covenants and agreements set forth in
Article 5.
SECTION 10.2. ENTIRE AGREEMENT; ASSIGNMENT. This Agreement (a) constitutes
the entire agreement between the parties hereto with respect to the subject
matter hereof and supersedes all other prior agreements and understandings both
written and oral between the parties with respect to the subject matter hereof
and (b) shall not be assigned by operation of law or otherwise.
SECTION 10.3. VALIDITY. If any provision of this Agreement or the
application thereof to any person or circumstance is held invalid or
unenforceable the remainder of this Agreement and the application of such
provision to other persons or circumstances shall not be affected thereby and to
such end the provisions of this Agreement are agreed to be severable.
SECTION 10.4. NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly given upon receipt) by delivery in person, by facsimile
or by registered or certified mail (postage prepaid, return receipt requested)
to each other party as follows:
<TABLE>
<S> <C>
if to Parent, GP or ION BEAM APPLICATIONS S.A.
Acquisition: Chemin du Cyclotron, 3
B-1348 Lourain-la-Neuve
Belgium
Telecopier: 011-32-10-47-5810
Attention: Pierre Mottet
with a copy to: Dorsey & Whitney LLP
250 Park Avenue
New York, New York 10177
Telecopier: (212) 953-7201
Attention: Ramon P. Marks, Esq.
Kevin T. Collins, Esq.
if to the Company to: STERIGENICS INTERNATIONAL, INC.
4020 Clipper Court
Fremont, California 94538
Telecopier:
Attention: James F. Clouser, President and Chief Executive
Officer
with a copy to: Gunderson Dettmer Stough Villeneuvee
Franklin & Hachigian, LLP
155 Constitution Drive
Menlo Park, California 94025
Telecopier: (650) 321-2800
Attention: Carla S. Newell, Esq.
Jay K. Hachigian, Esq.
</TABLE>
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
35
<PAGE>
SECTION 10.5. GOVERNING LAW. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware without regard to
the principles of conflicts of law thereof. Each of the parties hereto
irrevocably consents to the exclusive jurisdiction of any state or federal court
within Delaware, in connection with any matter based upon or arising out of this
Agreement or the matters contemplated herein, other than issues involving the
corporate governance of any of the parties hereto, agrees that process may be
served upon them in any manner authorized by the laws of the State of Delaware
for such persons and waives and covenants not to assert or plead any objection
which they might otherwise have to such jurisdiction and such process.
SECTION 10.6. DESCRIPTIVE HEADINGS. The descriptive headings herein are
inserted for convenience of reference only and are not intended to be part of or
to affect the meaning or interpretation of this Agreement.
SECTION 10.7. PARTIES IN INTEREST. This Agreement shall be binding upon
and inure solely to the benefit of each party hereto and its successors and
permitted assigns and nothing in this Agreement express or implied is intended
to or shall confer upon any other person any rights, benefits or remedies of any
nature whatsoever under or by reason of this Agreement.
SECTION 10.8. CERTAIN DEFINITIONS. For the purposes of this Agreement the
term:
(a) "affiliate" means a person that, directly or indirectly, through one
or more intermediaries controls, is controlled by or is under common control
with the first-mentioned person;
(b) "business day" means any day other than a day on which there is no
trading on Nasdaq;
(c) "stock" means common stock, preferred stock, partnership interests,
limited liability company interests or other ownership interests entitling
the holder thereof to vote with respect to matters involving the issuer
thereof;
(d) "person" means an individual, corporation, partnership, limited
liability company, association, trust, unincorporated organization or other
legal entity; and
(e) "subsidiary" or "subsidiaries" of the Company, Parent, the Surviving
Corporation or any other person means any corporation, partnership, limited
liability company, association, trust, unincorporated association or other
legal entity of which the Company, Parent, the Surviving Corporation or any
such other person, as the case may be, (either alone or through or together
with any other subsidiary) owns, directly or indirectly, 50% or more of the
capital stock the holders of which are generally entitled to vote for the
election of the board of directors or other governing body of such
corporation or other legal entity.
SECTION 10.9. PERSONAL LIABILITY. This Agreement shall not create or be
deemed to create or permit any personal liability or obligation on the part of
any direct or indirect stockholder of the Company or Parent or any officer,
director, employee, agent, representative or investor of any party hereto.
SECTION 10.10. SPECIFIC PERFORMANCE. The parties hereby acknowledge and
agree that the failure of any party to perform its agreements and covenants
hereunder, including its failure to take all actions as are necessary on its
part to the consummation of the Merger, will cause irreparable injury to the
other parties, for which damages, even if available, will not be an adequate
remedy. Accordingly, each party hereby consents to the issuance of injunctive
relief by any court of competent jurisdiction to compel performance of such
party's obligations and to the granting by any court of the remedy of specific
performance of its obligations hereunder; provided, however, that if a party
hereto is entitled to receive the Termination Fee pursuant to Section 9.3 it
shall not also be entitled to specific performance to compel the consummation of
the Merger.
36
<PAGE>
SECTION 10.11. COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original but all of which
shall constitute one and the same agreement.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be duly
executed on its behalf as of the day and year first above written.
<TABLE>
<S> <C> <C>
ION BEAM APPLICATIONS S.A.
By: /s/ PIERRE MOTTET
-----------------------------------------
Pierre Mottet
CHIEF EXECUTIVE OFFICER
ION BEAM APPLICATIONS G.P.
ION BEAM APPLICATIONS S.A.Its General Partner
By: /s/ PIERRE MOTTET
-----------------------------------------
Pierre Mottet
IBA ACQUISITION CORP.
By: /s/ PIERRE MOTTET
-----------------------------------------
Pierre Mottet
STERIGENICS INTERNATIONAL, INC.
By: /s/ JAMES F. CLOUSER
-----------------------------------------
James F. Clouser
CHIEF EXECUTIVE OFFICER
</TABLE>
37
<PAGE>
STOCKHOLDERS' AGREEMENT
THIS STOCKHOLDERS' AGREEMENT (the "Agreement") is dated as of June 10, 1999,
by and among Ion Beam Applications s.a. ("Parent"), a corporation organized
under the laws of the Kingdom of Belgium, Ion Beam Applications G.P. ("GP"), a
Delaware general partnership which is controlled by Parent, and IBA Acquisition
Corporation ("Acquisition"), a Delaware corporation which is wholly-owned by GP,
and the stockholders listed on Schedule I hereto (each, a "Stockholder," and
collectively, the "Stockholders") of SteriGenics International, Inc. (the
"Company"), a Delaware corporation. Capitalized terms used and not defined
herein have the respective meanings assigned to them in the Merger Agreement
(defined herein).
WHEREAS, concurrently herewith, Parent, GP, Acquisition and the Company are
entering into a Merger Agreement, the form of which is appended hereto as
Exhibit A (as such agreement may hereafter be amended from time to time, the
"Merger Agreement"), pursuant to which the Offer will be made by Acquisition for
the issued and outstanding Shares of the Company, and Acquisition will be merged
with and into the Company (the "Merger");
WHEREAS, each Stockholder Beneficially Owns (defined herein) the number of
shares, par value $0.01 per share, of common stock (the "Common Stock") of the
Company (the "Shares") set forth opposite each Stockholder's name on Schedule I
hereto;
WHEREAS, as an inducement and a condition to entering into the Merger
Agreement, Parent and Acquisition have required that each Stockholder agree, and
each of each Stockholder has agreed, to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual premises,
representations, warranties, covenants and agreements contained herein, the
parties hereby agree as follows:
SECTION 1. AGREEMENT TO VOTE; IRREVOCABLE PROXY.
(a) Each Stockholder hereby agrees that during the period commencing as of
the date of this Agreement and continuing until the first to occur of the
Closing Time or 45 days after the termination of the Merger Agreement in
accordance with its terms, at any meeting of the holders of the Shares, however
called, or in connection with any written consent of the holders of Shares, each
Stockholder shall vote (or cause to be voted) the Shares held of record or
Beneficially Owned (as defined herein) by each Stockholder, whether owned on the
date hereof or hereafter acquired, (i) in favor of approval of the Merger
Agreement, all transactions contemplated thereby, and any actions required in
furtherance thereof and hereof (including election of such directors of the
Company as Parent is entitled to designate pursuant to the Merger Agreement);
(ii) against any action or agreement that is intended, or could reasonably be
expected, to impede, interfere with, or prevent the Offer or the Merger or
result in a breach in any respect of any covenant, representation or warranty or
any other obligation or agreement of the Company or any of its subsidiaries
under the Merger Agreement or this Agreement; and (iii) except as specifically
requested in writing in advance by Parent, against the following actions (other
than the Merger and the transactions contemplated by the Merger Agreement and
this Agreement): (A) any extraordinary corporate transaction, such as a merger,
consolidation or other business combination involving the Company or any of its
subsidiaries or affiliates; (B) a sale, lease, transfer or disposition by the
Company or any of its subsidiaries of any assets outside the ordinary course of
business or any assets which in the aggregate are material to the Company and
its subsidiaries taken as a whole, or a reorganization, recapitalization,
dissolution or liquidation of the Company or any of its subsidiaries or
affiliates; (C)(1) any change in the present capitalization of the Company or
any amendment of the Company's charter or By-Laws; (2) any other material change
in the Company's or any of its subsidiaries' corporate structure or business; or
(3) any other action that, in the case of each of the matters referred to in
clauses (C)(1), (2) or (3), is intended, or could reasonably be expected, to
impede, interfere with, delay, postpone or materially adversely affect the
Offer, the Merger or the transactions contemplated by this Agreement or the
Merger Agreement. None of the Stockholders shall enter into any agreement or
understanding with any Person (as defined
<PAGE>
herein) the effect of which would be inconsistent with or violative of the
provisions and agreements contained in Section 1 or 2 hereof.
(b) By his execution hereof and in order to secure his obligations
hereunder, each Stockholder hereby grants to, and appoints Pierre Mottet and
Yves Jongen, in their respective capacities as officers of Parent, and any
individual who shall hereafter succeed to any such office of Parent, and any
other designee of Parent, and each of them individually, each Stockholder's true
and lawful irrevocable (until the earlier of the Closing Time or 45 days after
the termination of the Merger Agreement in accordance with its terms (the
"Termination Date")) proxy and attorney-in-fact (with full power of
substitution) to vote the Shares, or grant a consent or approval in respect of
such Shares, as indicated in Section 1(a) above; effective immediately upon the
execution of this Agreement. Each Stockholder intends this proxy to be
irrevocable (from the date of this Agreement until the Termination Date) and
coupled with an interest and will take such further action and execute such
other instruments as may be necessary to effectuate the intent of this proxy and
hereby represents that any proxy heretofore given in respect of his Shares is
not irrevocable, and hereby revokes any proxy previously granted by each
Stockholder with respect to the Shares. Each Stockholder understands and
acknowledges that Parent and Acquisition are entering into the Merger Agreement
in reliance on such Stockholder's execution and delivery of this irrevocable
proxy. Each Stockholder hereby affirms that this irrevocable proxy is given in
connection with the execution of this Agreement and the Merger Agreement, and
further affirms that this irrevocable proxy is coupled with an interest in this
Agreement for the term stated herein and may under no circumstances be revoked.
Each Stockholder hereby ratifies and confirms all that this irrevocable proxy
may lawfully do or cause to be done by virtue hereof. This proxy is executed and
intended to be irrevocable in accordance with the provisions of Section 212(e)
of the Delaware General Corporation Law. This proxy shall terminate
automatically on the Termination Date.
SECTION 2. OTHER COVENANTS, REPRESENTATIONS AND WARRANTIES.
Each Stockholder hereby represents, warrants and covenants to Parent and
Acquisition as of the date hereof and as of the Closing Time as follows:
(a) OWNERSHIP OF SHARES. Each Stockholder is the record and Beneficial Owner
of the number of Shares set forth opposite each Stockholder's name on Schedule I
hereto. On the date hereof, the Shares set forth opposite each Stockholder's
name on Schedule I hereto constitute all of the Shares owned of record or
Beneficially Owned by each Stockholder. Each Stockholder owns such Shares free
and clear of all liens, claims, charges, security interests, mortgages or other
encumbrances, and such Shares are subject to no rights of first refusal, put
rights, other rights to purchase or encumber such Shares, or to any agreements
other than this Agreement as to the encumbrance or disposition of such Shares.
Such Shares are duly and validly issued, fully paid and non-assessable. Each
Stockholder has sole voting power and sole power to issue instructions with
respect to the matters set forth in Section 1 hereof, sole power of disposition,
sole power of conversion, sole power to demand appraisal rights and sole power
to agree to all of the matters set forth in this Agreement, in each case with
respect to all of the Shares set forth opposite each Stockholder's name on
Schedule I hereto, with no limitations, qualifications or restrictions on such
rights.
(b) POWER; BINDING AGREEMENT. Each Stockholder has the legal capacity, power
and authority to enter into and perform all of such Stockholder's obligations
under this Agreement. The execution, delivery and performance of this Agreement
by each Stockholder will not violate any other agreement to which each
Stockholder is a party including, without limitation, any voting agreement,
shareholder agreement or voting trust. This Agreement has been duly and validly
executed and delivered by each Stockholder and constitutes a valid and binding
agreement of each Stockholder, enforceable against each Stockholder in
accordance with its terms, except as such enforceability may be limited by any
applicable bankruptcy, insolvency, reorganization, moratorium or other similar
laws affecting the
2
<PAGE>
enforcement of creditors' rights generally, and except as the availability of
equitable remedies may be limited by the application of general principles of
equity (regardless of whether such equitable principles are applied in a
proceeding at law or in equity). There is no beneficiary or holder of a voting
trust certificate or other interest of any trust of which each Stockholder is
trustee who is not a party to this Agreement and whose consent is required for
the execution and delivery of this Agreement or the consummation by each
Stockholder of the transactions contemplated hereby. If any Stockholder is
married and such Stockholder's Shares constitute community property, this
Agreement has been duly authorized, executed and delivered by, and constitutes a
valid and binding agreement of, such Stockholder's spouse, enforceable against
such person in accordance with its terms, except as such enforceability may be
limited by any applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights generally, and
except as the availability of equitable remedies may be limited by the
application of general principles of equity (regardless of whether such
equitable principles are applied in a proceeding at law or in equity).
(c) NO CONFLICTS. (i) Except for filings, permits, authorizations, consents
and approvals as may be required under and other applicable requirements of the
HSR Act, no filing with, and no permit, authorization, consent or approval of,
any state or federal public body or authority is necessary for the execution of
this Agreement by each Stockholder and the consummation by each Stockholder of
the transactions contemplated hereby and (ii) none of the execution or delivery
of this Agreement by each Stockholder, the consummation by each Stockholder of
the transactions contemplated hereby or compliance by each Stockholder with any
of the provisions hereof shall (A) result in a violation or breach of, or
constitute (with or without notice or lapse of time or both) a default (or give
rise to any third party right of termination, cancellation, material
modification or acceleration) under any of the terms, conditions or provisions
of any note, bond, mortgage, indenture, license, contract, commitment,
arrangement, understanding, agreement or other instrument or obligation of any
kind to which each Stockholder is a party or by which each Stockholder or any of
such Stockholder's properties or assets may be bound, or (B) violate any order,
writ, injunction, decree, judgment, order, statute, rule or regulation
applicable to each Stockholder or any of each Stockholder's properties or
assets. This Agreement supersedes all prior agreements to which each Stockholder
is a party with respect to such Stockholder's Shares.
(d) NO FINDER'S FEES. No broker, investment banker, financial adviser or
other person is entitled to any broker's, finder's, financial adviser's or other
similar fee or commission in connection with the transactions contemplated by
the Merger Agreement based upon arrangements made by or on behalf of any
Stockholder.
(e) OTHER POTENTIAL ACQUIRERS. Each Stockholder (i) shall immediately cease
any existing discussions or negotiations, if any, with any parties conducted
heretofore with respect to any acquisition of all or any material portion of the
assets of, or any equity interest in, the Company or any of its subsidiaries or
any business combination with the Company or any of its subsidiaries, in his or
her capacity as such, and (ii) from and after the date hereof until termination
of the Merger Agreement in accordance with its terms, shall not, in its or his
capacity as a stockholder of the Company, directly or indirectly, initiate,
solicit or knowingly encourage (including by way of furnishing non-public
information or assistance), or take any other action to facilitate knowingly,
any inquiries or the making of any proposal that constitutes, or may reasonably
be expected to lead to, any such transaction or acquisition, or agree to or
endorse any such transaction or acquisition, or authorize or permit any of each
Stockholder's agents to do so, and each Stockholder shall promptly notify Parent
of any proposal and shall provide a copy of any such written proposal and a
summary of any oral proposal to Parent immediately after receipt thereof (and
shall specify the material terms and conditions of such proposal and identify
the person making such proposal) and thereafter keep Parent advised of any
development with respect thereto.
(f) TENDER OF SHARES; RESTRICTION ON TRANSFER, PROXIES AND NON-INTERFERENCE.
Each of the Stockholders shall tender his or its Shares in the Offer (as defined
in the Merger Agreement) and shall not withdraw
3
<PAGE>
such Shares therefrom unless and until the Merger Agreement is terminated in
accordance with its terms without such Shares being purchased by Acquisition
pursuant to the Offer. None of the Stockholders shall, directly or indirectly:
(i) tender his or its Shares in any other tender offer or exchange offer for the
Shares; (ii) except as contemplated by this Agreement or the Merger Agreement,
otherwise offer for sale, sell, transfer, tender, pledge, encumber, assign or
otherwise dispose of, or enter into any contract, option or other arrangement or
understanding with respect to or consent to the offer for sale, transfer,
tender, pledge, encumbrance, assignment or other disposition of, any or all of
any such Stockholder's Shares or any interest therein; (iii) grant any proxies
or powers of attorney, deposit any Shares into a voting trust or enter into a
voting agreement with respect to any Shares; or (iv) take any action that would
make any representation or warranty of any such Stockholder contained herein
untrue or incorrect or have the effect of preventing or disabling such
Stockholder from performing such Stockholder's obligations under this Agreement.
(g) RELIANCE BY PARENT AND ACQUISITION. Each Stockholder understands and
acknowledges that Parent and Acquisition are relying upon the foregoing
representations, warranties and covenants by such Stockholder, and on each
Stockholder's execution and delivery of this Agreement in entering into the
Merger Agreement.
SECTION 3. FURTHER ASSURANCES; MERGER AGREEMENT COMPLIANCE.
From time to time, at Parent's request and without further consideration,
each Stockholder agrees to execute and deliver such additional documents and
take all such further lawful action as may be necessary or desirable to
consummate and make effective, and to cause the Company to consummate and make
effective, in the most expeditious manner practicable, the transactions
contemplated by this Agreement.
SECTION 4. STOP TRANSFER; FORM OF LEGEND.
(a) Each Stockholder agrees with, and covenants to, Parent that each
Stockholder shall not request that the Company register the transfer (book-entry
or otherwise) of any certificate or uncertificated interest representing any of
each Stockholder's Shares, without the consent of the Parent. In the event of a
stock dividend or distribution, or any change in the Shares by reason of any
stock dividend, split-up, recapitalization, combination, exchange of shares or
the like, the term "Shares" shall be deemed to refer to and include the Shares
as well as all such stock dividends and distributions and any shares into which
or for which any or all of the Shares may be changed or exchanged.
(b) If reasonably requested by Parent, all certificates representing any of
each Stockholder's Shares shall contain the following legend:
"The securities represented by this certificate are subject to
certain restrictions on transfer and other terms of a Stockholders
Agreement, dated as of June 10, 1999, among Ion Beam Applications
s.a., Ion Beam Applications G.P., IBA Acquisition Corporation, and
the parties listed on the signatures pages thereto, a copy of
which is on file in the principal office of Ion Beam Applications
s.a."
SECTION 5. THE OPTIONS.
Each Stockholder hereby agrees as follows:
(a) GRANT OF OPTIONS. Subject to the terms of this Section 5, each
Stockholder hereby grants to Parent (or its designee), effective upon the
execution hereof, an irrevocable option (each, an "Option") to purchase all
Shares held of record or Beneficially Owned by each such Stockholder at a
purchase price per Share equal to the greater of $27 or such higher price as may
be offered by Acquisition in the Offer (the "Option Price").
4
<PAGE>
(b) EXERCISE OF OPTIONS. Parent may exercise the Options, in whole or in
part, at any time and from time to time, following the occurrence of a Purchase
Event (as defined below); PROVIDED that any Options not theretofore exercised
shall expire and be of no further force and effect upon the earliest to occur
(the "Expiration Date") of (i) the Closing Time; (ii) forty-five days after the
first occurrence of a Purchase Event; or (iii) forty-five days after the
termination of the Merger Agreement in accordance with Section 9.1(c)(i), (ii)
or (iii) of the Merger Agreement; provided, however, that in the case of clauses
(ii) and (iii) above, the Expiration Date shall be extended for a period not to
extend beyond March 31, 2000 in the event that clearance under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act")
is required by Parent to acquire the Shares; provided, further that Parent is
using all reasonable efforts to obtain such clearance.
As used herein, a "Purchase Event" shall mean any of the following events
that occurs after the date hereof:
(i) Beneficial Ownership of more than 20% of the outstanding capital
stock of the Company (or rights to acquire such capital stock of the
Company) shall have been acquired by any Person or "group" other than
Parent, Acquisition, or any affiliate of any of them;
(ii) the Company shall have entered into a definitive agreement or
approved or recommended any proposal which provides for the acquisition of
20% or more of the outstanding capital stock of the Company or substantially
all of the assets of the Company by any Person or group other than Parent,
Acquisition, or an affiliate of any of them;
(iii) (A) the failure of the Company's stockholders to approve the
Merger Agreement or the transactions contemplated thereby at a meeting
called to consider such Merger Agreement, if such meeting shall have been
preceded by (x) the public announcement by any Person or group (other than
Parent, Acquisition or an affiliate of any of them) of an offer or proposal
to acquire, merge or consolidate with the Company, or (y) the Board of
Directors of the Company's publicly withdrawing or modifying, or publicly
announcing its intent to withdraw or modify, its recommendation that the
stockholders of the Company approve the transactions contemplated by the
Merger Agreement or (B) the acceptance by the Company's Board of Directors
of, or the public recommendation by the Company's Board of Directors that
the stockholders of the Company accept, an offer or proposal from any Person
or group (other than Parent, Acquisition or an affiliate of any of them), to
acquire 20% or more of the outstanding capital stock of the Company or for a
merger or consolidation or any similar transaction involving the Company;
(iv) the making of an Acquisition Proposal as described in Section 5.3
of the Merger Agreement which would entitle Parent or the Company to
terminate the Merger Agreement pursuant to Section 9.1 of the Merger
Agreement; or
(v) any breach by the Stockholder of this Agreement.
(c) NOTICE OF EXERCISE. To exercise an Option, Parent shall, prior to the
Expiration Date, give written notice to each Stockholder specifying the location
in Palo Alto, California and time for the closing (the "Option Closing") of such
purchase. The Option Closing shall be held on the date that is no later than
three business days after the date on which each of the conditions set forth in
Section 5(d) below has been satisfied or waived by Parent.
(d) CONDITIONS TO OPTION CLOSING FOLLOWING EXERCISE OF OPTIONS. The
occurrence of the Option Closing shall be subject to the satisfaction of each of
the following conditions:
(i) to the extent necessary, any applicable waiting periods (and any
extension thereof) under the HSR Act with respect to the purchase of the
Shares following the exercise of an Option shall have expired or been
terminated; and
5
<PAGE>
(ii) no preliminary or permanent injunction or other order, decree or ruling
issued by any court of governmental or regulatory authority, domestic or
foreign, of competent jurisdiction prohibiting the exercise of an Option or the
delivery of Shares shall be in effect.
The foregoing conditions may be waived solely by Parent, PROVIDED THAT no
Stockholder would incur any material liability as a result of such waiver.
(e) TRANSFERABILITY OF OPTIONS. Parent may sell or transfer the Options and
any Shares acquired upon exercise of an Option at any time, without the written
consent of each Stockholder, to any affiliate or affiliates of Parent,
Acquisition or the an affiliate of any of them.
(f) PAYMENT FOR AND DELIVERY OF CERTIFICATES. At the Option Closing, (i)
Parent (or its designee) shall pay, by check, an amount equal to the product of
(x) the Option Price and (y) the number of Shares owned by each Stockholder; and
(ii) each Stockholder shall deliver or shall cause to be delivered to Parent a
certificate or certificates evidencing each Stockholder's Shares, and each
Stockholder agrees that such Shares shall be transferred free and clear of all
liens. All such certificates representing Shares shall be duly endorsed in
blank, or with appropriate stock powers, duly executed in blank, attached
thereto, in proper form for transfer, with the signature of each Stockholder
thereon guaranteed, and with all applicable taxes paid or provided for.
SECTION 6. TERMINATION.
Except as otherwise provided herein, the covenants and agreements contained
herein with respect to the Shares shall terminate upon the earliest of (a)
termination of the Merger Agreement in accordance with its terms, or (b) the
Effective Time.
SECTION 7. STOCKHOLDER CAPACITY.
No person executing this Agreement who is or becomes during the term hereof
a director or executive officer of the Company makes any agreement or
understanding herein in his or her capacity as such director or executive
officer. Each Stockholder signs solely in his capacity as the record and/or
beneficial owner of each Stockholder's Shares.
SECTION 8. WAIVER OF APPRAISAL AND DISSENTER'S RIGHTS.
Each Stockholder hereby irrevocably waives any rights of appraisal or rights
to dissent from the Merger that each Stockholder may have.
SECTION 9. MISCELLANEOUS.
(a) CERTAIN DEFINITIONS. As used in this Agreement, the following
capitalized terms shall have the following meanings:
(i) "Beneficially Own" or "Beneficial Ownership" with respect to any
securities shall mean having "beneficial ownership" of such securities (as
determined pursuant to Rule 13d-3 under the Exchange Act), including
pursuant to any agreement, arrangement or understanding, whether or not in
writing. Without duplicative counting of the same securities by the same
holder, securities Beneficially Owned by a Person shall include securities
Beneficially Owned by all other Persons with whom such Person would
constitute a "group" as within the meanings of Section 13(d)(3) of the
Exchange Act.
(ii) "Misstatement" means an untrue statement of a material fact or an
omission to state a material fact required to be stated in a publicly-filed
document necessary to make the statements in such a document not misleading.
6
<PAGE>
(iii) "Person" shall mean an individual, corporation, partnership, joint
venture, association, trust, unincorporated organization or other entity.
(iv) "register," "registered," and "registration" refer to a
registration effected by preparing and filing with the SEC a registration
statement in compliance with the Securities Act and the declaration or
ordering by the SEC of effectiveness of such registration statement.
(v) "subsidiary" or "subsidiaries" of Parent, Acquisition, the Company
or any other person means any corporation, partnership, limited liability
company, association, trust, unincorporated association or other legal
entity of which the Parent, Acquisition, the Company or any such other
person, as the case may be, (either alone or through or together with any
other subsidiary) owns, directly or indirectly, 50% or more of the capital
stock the holders of which are generally entitled to vote for the election
of the board of directors or other governing body of such corporation or
other legal entity.
(b) ENTIRE AGREEMENT. This Agreement and the Merger Agreement constitute the
entire agreement between the parties with respect to the subject matter hereof
and supersede all other prior agreements and understandings, both written and
oral, between the parties with respect to the subject matter hereof.
(c) CERTAIN EVENTS. Each Stockholder agrees that this Agreement and the
obligations hereunder shall attach to each Stockholder's Shares and shall be
binding upon any person or entity to which legal or beneficial ownership of such
Shares shall pass, whether by operation of law or otherwise, including, without
limitation, each Stockholder's heirs, guardians, administrators or successors.
Notwithstanding any transfer of Shares, the transferor shall remain liable for
the performance of all obligations under this Agreement of the transferor.
(d) ASSIGNMENT. This Agreement may not be assigned by any Stockholder
without the consent of Parent. Parent may assign, in its sole discretion, its
rights and obligations hereunder to any direct or indirect wholly-owned
subsidiary of Parent, but no such assignment shall relieve Parent of its
obligations hereunder if such assignee does not perform such obligations.
(e) AMENDMENTS, WAIVERS, ETC. This Agreement may not be amended, changed,
supplemented, waived or otherwise modified or terminated, with respect to each
Stockholder, except upon the execution and delivery of a written agreement
executed by the relevant parties hereto; PROVIDED that Schedule I hereto may be
supplemented by Parent by adding the name and other relevant information
concerning any stockholder of the Company who agrees to be bound by the terms of
this Agreement (by executing a counterpart signature page hereof) without the
agreement of any other party hereto, and thereafter such added stockholder shall
be treated as a "Stockholder" for all purposes of this Agreement.
(f) NOTICES. All notices, requests, claims, demands and other communications
hereunder shall be in writing and shall be given (and shall be deemed to have
been duly received if so given) by hand delivery, telegram, telex or telecopy,
or by mail (registered or certified mail, postage prepaid, return
7
<PAGE>
receipt requested) or by any courier service, such as Federal Express, providing
proof of delivery. All communications hereunder shall be addressed to the
respective parties at the following addresses:
<TABLE>
<S> <C>
If to each Stockholder: At the address set forth on Schedule I
hereto.
If to Parent or Acquisition: Ion Beam Applications s.a.
Chemin du Cyclotron, 3
B-1348 Louvain-la-Neuve, Belgium
Telephone: 011-32-10-47-5855
Telecopier: 011-32-10-47-5810
Attention: Mr. Pierre Mottet, Chief
Executive Officer
with a copy to: Dorsey & Whitney LLP
250 Park Avenue
New York, NY 10177
Telephone: (212) 415-9200
Telecopier: (212) 953-7201
Attention: Ramon P. Marks, Esq.
</TABLE>
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
(g) SEVERABILITY. Whenever possible, each provision or portion of any
provision of this Agreement will be interpreted in such manner as to be
effective and valid under applicable law, but if any provision or portion of any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability will not affect any other provision
or portion of any provision in such jurisdiction, and this Agreement will be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision or portion of any provision had never been
contained herein.
(h) SPECIFIC PERFORMANCE. Each of the parties hereto recognizes and
acknowledges that a breach by it of any covenants or agreements contained in
this Agreement will cause the other party to sustain damages for which it would
not have an adequate remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the aggrieved party
shall be entitled to the remedy of specific performance of such covenants and
agreements and injunctive and other equitable relief in addition to any other
remedy to which it may be entitled, at law or in equity.
(i) REMEDIES CUMULATIVE. All rights, powers and remedies provided under this
Agreement or otherwise available in respect hereof at law or in equity shall be
cumulative and not alternative, and the exercise of any thereof by any party
shall not preclude the simultaneous or later exercise of any other such right,
power or remedy by such party.
(j) NO WAIVER. The failure of any party hereto to exercise any right, power
or remedy provided under this Agreement or otherwise available in respect hereof
at law or in equity, or to insist upon compliance by any other party hereto with
its obligations hereunder, and any custom or practice of the parties at variance
with the terms hereof, shall not constitute a waiver by such party of its right
to exercise any such or other right, power or remedy or to demand such
compliance.
(k) NO THIRD PARTY BENEFICIARIES. This Agreement is not intended to be for
the benefit of, and shall not be enforceable by, any person or entity who or
which is not a party hereto.
(l) GOVERNING LAW. This Agreement shall be governed and construed in
accordance with the laws of the State of Delaware, without giving effect to the
principles of conflicts of laws thereof.
8
<PAGE>
(m) DESCRIPTIVE HEADINGS. The descriptive headings used herein are inserted
for convenience of reference only and are not intended to be part of or to
affect the meaning or interpretation of this Agreement.
(n) COUNTERPARTS. This Agreement may be executed in counterparts, each of
which shall be deemed to be an original, but all of which, taken together, shall
constitute one and the same Agreement.
9
<PAGE>
IN WITNESS WHEREOF, Parent and Acquisition have caused this Agreement to be
duly executed, and each Stockholder has duly executed this Agreement, as of the
day and year first above written.
ION BEAM APPLICATIONS S.A.
By: /s/ Pierre Mottet
Pierre Mottet
Chief Executive Officer
ION BEAM APPLICATIONS G.P.
By: /s/ Pierre Mottet
ION BEAM APPLICATIONS S.A.,
Its Partner
By: /s/ Pierre Mottet
Pierre Mottet
Chief Executive Officer
IBA ACQUISITION CORP.
By: /s/ Pierre Mottet
Pierre Mottet
10
<PAGE>
SCHEDULE I
<TABLE>
<CAPTION>
NUMBER OF
NAME OF STOCKHOLDER ADDRESS SHARES OWNED
- ------------------------------------------------ ------------------------------------------------ -------------
<S> <C> <C>
The Charles W. King, Jr. Revocable 405 Alberto Way, Suite 5 20,962
Trust Dated December 17, 1986 Los Gatos, California 95032
The Charles W. King, III Trust 405 Alberto Way, Suite 5 81,050
Dated April 15, 1983 Los Gatos, California 95032
The Michael James King Trust 405 Alberto Way, Suite 5 81,050
Dated April 15, 1983 Los Gatos, California 95032
The Patricia M. King Trust 405 Alberto Way, Suite 5 81,050
Dated April 15, 1983 Los Gatos, California 95032
KFFP II, L.P., a California 405 Alberto Way, Suite 5 400,000
Limited Partnership Los Gatos, California 95032
KFFP III, L.P., a California 405 Alberto Way, Suite 5 1,800,000
Limited Partnership Los Gatos, California 95032
The King Family Trust 405 Alberto Way, Suite 5 30,200
Dated December 16, 1997 Los Gatos, California 95032
</TABLE>
<PAGE>
IBA
ION BEAM APPLICATIONS S.A.
CHEMIN DU CYCLOTRON, 3
B-1348 LOUVAIN-LA-NEUVE
BELGIUM
May 17, 1999
VIA FEDERAL EXPRESS
SteriGenics International, Inc.
4020 Clipper Court
Fremont, California 94538-6540
RE: NONDISCLOSURE AGREEMENT
In connection with the consideration by Ion Beam Applications, s.a. ("IBA")
and SteriGenics International Inc. (the "Company") of a possible business
combination transaction (a "Transaction") the Company and IBA expect to make
available to one another certain nonpublic information concerning their
respective businesses, financial conditions, operations, assets and liabilities.
As a condition to such information being furnished to each party and its
directors, officers, employees, agents or advisors (INCLUDING without limitation
attorneys, accountants, consultants, bankers and financial advisors)
(collectively, "Representatives"), each party agrees to treat any nonpublic
information concerning the other party (whether prepared by the disclosing
party, its advisors or otherwise and irrespective of the form of communication)
which is furnished hereunder to a party or to its Representatives now or in the
future by or on behalf of the disclosing party (herein collectively referred to
as the "Evaluation Material") in accordance with the provisions of this letter
agreement, and to take or abstain from taking certain other actions hereinafter
set forth.
1. EVALUATION MATERIAL. The term "Evaluation Material" also shall be deemed
to include all notes, analyses, compilations, studies, interpretations or other
documents prepared by each party or its Representatives which contain, reflect
or are based upon, in whole or in part, the information furnished to such party
or its Representatives pursuant hereto which is not available to the general
public. The term "Evaluation Material" does not include information which (i) is
or becomes generally available to the public other than as a result of a breach
of this Agreement by the receiving party or its Representatives, (ii) was within
the receiving party's possession prior to its being furnished to the receiving
party by or on behalf of the disclosing party, provided that the source of such
information was not known by the receiving party to be bound by a
confidentiality agreement with or other contractual, legal or fiduciary
obligation of confidentiality to the disclosing party or any other party with
respect to such information, (iii) is or becomes available to the receiving
party on a non-confidential basis from a source other than the disclosing party
or any of its Representatives, provided that such source was not known by the
receiving party to be bound by a confidentiality agreement with or other
contractual, legal or fiduciary obligation of confidentiality to the disclosing
party, (iv) is independently developed by the recipient without use of
Evaluation Material, or (v) is disclosed by the recipient or its Representatives
with the disclosing party's prior written approval.
2. PURPOSE OF DISCLOSURE OF EVALUATION MATERIAL. It is understood and
agreed to by each party that any exchange of information under this agreement
shall be solely for the purpose of evaluating a Transaction between the parties
and not to affect, in any way, each party's relative competitive position to
each party or to other entities. It is further agreed, that the information to
be disclosed to each other shall only be that information which is reasonably
necessary to a Transaction and that information which is not reasonably
necessary for such purposes shall not be disclosed or exchanged.
3. USE OF EVALUATION MATERIAL. Each party hereby agrees that it and its
Representatives shall use the other's Evaluation Material solely for the purpose
of evaluating a possible Transaction between the parties,
<PAGE>
and that the disclosing party's Evaluation Material will be kept confidential
and each party and its Representatives will not disclose or use for purposes
other than the evaluation of a Transaction any of the other's Evaluation
Material in any manner whatsoever, provided, however, that (i) the receiving
party may make any disclosure of such information to which the disclosing party
gives its prior written consent and (ii) any of such information may be
disclosed to the receiving party's Representatives who need to know such
information for the sole purpose of evaluating a possible Transaction between
the parties, who are provided with a copy of this letter agreement and who are
directed by the receiving party to treat such information as confidential.
4. SECURITIES LAWS. Each party hereby acknowledges that it is aware, and
will advise its Representatives who are informed as to the matters which are the
subject of this letter, that the United States securities laws prohibit any
person who has received from an issuer material, non-public information
concerning the matters which are the subject of this letter from purchasing or
selling securities of such issuer or from communicating such information to any
other person under circumstances in which it is reasonably foreseeable that such
person is likely to purchase or sell such securities.
5. NON-DISCLOSURE. In addition, each party agrees that, without the prior
written consent of the other party, its Representatives will not disclose to any
other person the fact that any Evaluation Material has been made available
hereunder, that discussions or negotiations are taking place concerning a
Transaction involving the parties or any of the terms, conditions or other facts
with respect thereto (including the sums thereof) provided, that a party may
make such disclosure if in the written opinion of a party's outside counsel,
such disclosure is necessary to avoid committing a violation of law. In such
event, the disclosing party shall use its best efforts to give advance notice to
the other party. In this regard the parties acknowledge that the Company is
publicly traded in the United States, IBA is publicly traded in Belgium and IBA
has filed a Schedule 13D with the Securities and Exchange Commission with
respect to its ownership shares of common stock of the Company.
6. REQUIRED DISCLOSURE. In the event that a party or its Representatives
are requested or required (by oral questions, interrogatories, requests for
information or documents in legal proceedings, subpoena, civil investigative
demand or other similar process) to disclose any of the other party's Evaluation
Material, the party requested or required to make the disclosure shall provide
the other party with prompt notice of any such request or requirement so that
the other party may seek a protective order or other appropriate remedy and/or
waive compliance with the provisions of this letter agreement. If, in the
absence of a protective order or other remedy or the receipt of a waiver by such
other party, the party requested or required to make the disclosures or any of
its Representatives are nonetheless, in the opinion of counsel, legally
compelled to disclose the other party's Evaluation Material to any tribunal, the
party requested or required to make the disclosure or its Representative may,
without liability hereunder, disclose to such tribunal only that portion of the
other party's Evaluation Material which such counsel advises is legally required
to be disclosed, provided that the party requested or required to make the
disclosure exercises its reasonable efforts to preserve the confidentiality of
the other party's Evaluation Material, including, without limitation, by
cooperating with the other party to obtain an appropriate protective order or
other reliable assurance that confidential treatment will be accorded the other
party's Evaluation Material by such tribunal.
7. TERMINATION OF DISCUSSION. If either party decides that it does not wish
to proceed with a Transaction with the other party, the party so deciding will
promptly inform the other party of that decision by giving written notice
thereof. In that case, or at any time upon the request of either disclosing
party for any reason, each receiving party and its Representatives (except as
otherwise required by law or the customary record keeping policies of the
receiving party or its Representatives) will make reasonable efforts either to
promptly deliver to the disclosing party, or to destroy, all written Evaluation
Material (and all copies thereof and extracts therefrom) furnished to the
receiving party or its Representatives by or on behalf of the disclosing party
pursuant hereto, or the receiving party will make reasonable efforts to delete
from any retained document any reference to Evaluation Material furnished to the
receiving party or its Representatives by or on behalf of the disclosing party
pursuant hereto. Notwithstanding the return, destruction or retention of any
Evaluation Material, each party and its Representatives will continue to be
bound by its obligations of confidentiality and other obligations hereunder.
<PAGE>
8. REPRESENTATION OF ACCURACY. Each party understands and acknowledges that
neither party nor any of its Representatives makes any representation or
warranty, express or implied, as to the accuracy or completeness of the
Evaluation Material made available by it or to it. Each party agrees that
neither party nor any of its Representatives shall have any liability to the
other party or to any of its Representatives relating to or resulting from the
use of or reliance upon such other party's Evaluation Material or any errors
therein or omissions, therefrom. Only those representations or warranties which
are made in a final definitive agreement regarding the Transaction, when, as and
if executed, and subject to such limitations and restrictions as may be
specified therein, will have any legal effect.
9. DEFINITIVE AGREEMENTS. Each party understands and agrees that no
contract or agreement providing for any Transaction involving the parties shall
be deemed to exist between the parties unless and until a final definitive
agreement has been executed and delivered. Each party also agrees that unless
and until a final definitive agreement regarding a Transaction between the
parties has been executed and delivered, neither party will be under any legal
obligation of any kind whatsoever with respect to such a Transaction by virtue
of this letter agreement except for the matters specifically agreed to herein.
For purposes of this paragraph, the term "definitive agreement" does not include
an executed letter of intent or any other preliminary written agreement. Both
parties further acknowledge and agree that each party reserves the right, in its
sole discretion, to provide or not provide Evaluation Material to the receiving
party under this Agreement, to reject any and all proposals made by the other
party or any of its Representatives with regard to a Transaction between the
parties, and to terminate discussions and negotiations at any time.
10. WAIVER. It is understood and agreed that no failure or delay by either
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 future exercise thereof or the exercise of any other right, power or
privilege hereunder.
11. NON-SOLICITATION. In consideration of the furnishing of Evaluation
Material hereunder, each party agrees that, for a period of two years from the
date hereof, neither such party nor any of its affiliates will solicit to employ
any of the current officers or employees of the other party with whom such party
has contact or who is specifically identified to such party during the period of
such party's investigation of the other party with respect to a possible
Transaction, so long as they are employed by the other party, without obtaining
the prior written consent of the other party; provided, however, that
solicitation for purposes of this paragraph shall not include solicitation of
employees or officers (i) who first solicit employment from such party, or (ii)
who are solicited (A) by advertising in periodicals of general circulation, or
(B) by an employee search firm on behalf of such party, so long as such party
did not direct or encourage such firm to solicit such employee or officer or any
other employees or officers of the party.
12. MISCELLANEOUS. Each party agrees to be responsible for any breach of
this agreement by any of its Representatives acting in such capacity. No failure
or delay by either party or any of its Representatives in exercising any right,
power or privileges under this agreement shall operate as a waiver thereof nor
shall any single or partial exercise thereof preclude any other or further
exercise of any right, power, or privilege hereunder, and the non-breaching
party shall be entitled to equitable relief, including injunction and specific
performance, as a remedy for any such breach. Such remedies shall not be deemed
to be the exclusive remedies for a breach of this letter agreement but shall be
in addition to all other remedies available at law or equity. In the event of
litigation relating to this letter agreement, if a court of competent
jurisdiction determines that either party or any of its Representatives have
breached this letter agreement, then the breaching party shall be liable and pay
to the non-breaching party the reasonable legal fees incurred in connection with
such litigation, including an appeal therefrom. In case any provision of this
agreement shall be invalid, illegal or unenforceable, the validity, legality and
enforceability, of the remaining provisions of the agreement shall not in any
way be affected or impaired thereby.
This Agreement shall be governed by, and construed in accordance with, the
internal laws of the State of California, without giving effect to the
principles of conflicts of laws thereof. Venue for any action to enforce the
provisions of this Agreement shall be properly laid in any state or federal
court in the State of California.
<PAGE>
13. COUNTERPARTS. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
If the foregoing meets with your approval, please sign in the space provided
below and return a copy to us.
Very truly yours,
Ion Beam Applications, SA
By: /s/ PIERRE MOTTET
------------------------------------------------------------------
Name: Pierre Mottet
Title: CEO
Accepted and agreed as of the date first written above:
Sterigenics International, Inc.
By: /s/ JAMES A. CLOUSER
- ----------------------------
Name: James A. Clouser
Title: President & CEO
