<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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SCHEDULE 14D-1
Tender Offer Statement
Pursuant to Section 14(d)(1) of the Securities Exchange Act of 1934
---------------
DAMES & MOORE GROUP
(Name of Subject Company)
---------------
DEMETER ACQUISITION CORPORATION
URS CORPORATION
(Bidders)
---------------
Common Stock, Par Value $0.01 Per Share
(Including the Associated Preferred Stock Purchase Rights)
(Title of Class of Securities)
---------------
235713 10 4
(CUSIP Number of Class of Securities)
---------------
Kent P. Ainsworth
Demeter Acquisition Corporation
c/o URS Corporation
100 California Street, Suite 500
San Francisco, CA 94111
(415) 774-2700
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications on Behalf of the Bidder)
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Copies to:
Samuel M. Livermore, Esq.
Cooley Godward llp
One Maritime Plaza, 20th Floor
San Francisco, CA 94111
(415) 693-2000
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CALCULATION OF FILING FEE
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<TABLE>
<S> <C>
Transaction Valuation Amount of Filing Fee
</TABLE>
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<TABLE>
<S> <C>
$327,924,624(1) $65,585
</TABLE>
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(1) For purposes of calculating amount of filing fee only. The amount assumes
the purchase of 20,495,289 shares of common stock, par value $0.01 per
share (together with the associated preferred stock purchase rights, the
"Shares"), at a price per Share of $16.00 in cash. Such number of shares
represents all the Shares outstanding as of April 30, 1999, plus the
number of Shares issuable upon the exercise of all outstanding options.
[_]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 its filing.
<TABLE>
<S> <C>
Amount Previously Paid: None Filing Party: N/A
Form or Registration No.: N/A Date Filed: N/A
</TABLE>
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<PAGE>
CUSIP No. 235713 10 4
Schedule 14D-1 Page 2 of 8 pages
Name of Reporting Persons
1.S.S. or I.R.S. Identification Number of Above Person:
Demeter Acquisition Corporation (applied for)
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Check the Appropriate Box if a Member of a Group*: (a) [_]
2. (b) [_]
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3.SEC Use Only
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Source of Funds*:
4.
AF
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5.Check Box if Disclosure of Legal Proceedings is Required Pursuant to [_]
Items 2(e) or 2(f)
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Citizenship or Place of Organization:
6.
Delaware
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Number of Shares Beneficially Owned by Each Reporting Person With:
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Sole Voting Power:
7.
0
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8.Shared Voting Power:
0
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Sole Dispositive Power:
9.
0
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10.Shared Dispositive Power:
0
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Aggregate Amount Beneficially Owned by Each Reporting Person:
11.
0
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Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares*:
[_]
12.
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13.
Percent of Class Represented by Amount in Row (11):
0%
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14.
Type of Reporting Person*:
CO
2
<PAGE>
CUSIP No. 235713 10 4
Schedule 14D-1 Page 3 of 8 pages
Name of Reporting Persons:
1.S.S. or I.R.S. Identification Number of Above Person
URS Corporation: 94-1381538
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Check the Appropriate Box if a Member of a Group*: (a) [_]
2. (b) [_]
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3.SEC Use Only
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Source of Funds*:
4.
BK, OO, AF
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5.Check Box if Disclosure of Legal Proceedings is Required Pursuant to [_]
Items 2(e) or 2(f)
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Citizenship or Place of Organization:
6.
Delaware
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Number of Shares Beneficially Owned by Each Reporting Person With
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Sole Voting Power:
7.
0
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8.Shares Voting Power:
0
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Sole Dispositive Power:
9.
0
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10.Shared Dispositive Power:
0
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Aggregate Amount Beneficially Owned by Each Reporting Person:
11.
0
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Check Box if the Aggregate Amount in Row (11) Excludes Certain Shares*[_]
12.
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13.
Percent of Class Represented by Amount in Row (11):
0%
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14.
Type of Reporting Person*:
CO, HC
3
<PAGE>
This Tender Offer Statement on Schedule 14D-1 (the "Statement") relates to
the offer by Demeter Acquisition Corporation, a Delaware corporation (the
"Purchaser") and a wholly owned subsidiary of URS Corporation, a Delaware
corporation ("Parent"), to purchase all outstanding shares of common stock,
par value $0.01 per share (together with the associated preferred stock
purchase rights, the "Shares"), of Dames & Moore Group, a Delaware corporation
(the "Company"), at a price of $16.00 per Share, net to the seller in cash
(subject to applicable withholding of taxes), without interest, upon the terms
and subject to the conditions set forth in Purchaser's Offer to Purchase,
dated May 11, 1999 (the "Offer to Purchase"), and in the related Letter of
Transmittal (which, together with any amendments or supplements thereto,
collectively constitute the "Offer"), copies of which are filed herewith as
Exhibits (a)(1) and (a)(2), respectively.
ITEM 1. SECURITY AND SUBJECT COMPANY.
(a) The name of the subject company is Dames & Moore Group and its principal
executive offices are located at 911 Wilshire Boulevard, Suite 700, Los
Angeles, CA 90017.
(b) The class of equity securities and the exact amount of such securities
being sought are all outstanding shares of common stock, par value $0.01 per
share, of the Company (including the associated preferred stock purchase
rights, the "Shares"). The consideration being offered in the Offer is $16.00
per Share. As of April 30, 1999, there were 18,595,311 Shares issued and
outstanding (and 1,899,978 Shares reserved for issuance upon the exercise of
outstanding Company stock options), as represented by the Company in the
Agreement and Plan of Merger, dated as of May 5, 1999, among Parent, the
Purchaser and the Company. The information set forth in "Introduction" and
Section 1 ("Terms of the Offer") of the Offer to Purchase 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 for each quarterly period during the past two years is set forth in
Section 6 ("Price Range of Shares; Dividends") in the Offer to Purchase and is
incorporated herein by reference.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(d) and (g) This Statement is being filed by the Purchaser, a Delaware
corporation, and Parent, a Delaware corporation. The Purchaser is a wholly
owned subsidiary of Parent. Information concerning the principal business and
the address of the principal offices of the Purchaser and Parent is set forth
in Section 8 ("Certain Information Concerning the Purchaser and Parent") of
the Offer to Purchase and is incorporated herein by reference. The names,
business addresses, present principal occupations or employment, material
occupations, positions, offices or employments during the last five years and
citizenship of the directors and executive officers of the Purchaser and
Parent are set forth in Schedule I to the Offer to Purchase and are
incorporated herein by reference.
(e) and (f) During the last five years, neither the Purchaser nor Parent
and, to the best knowledge of the Purchaser and Parent, none of the persons
listed in Schedule I of 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 violation of such laws.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
(a) The information set forth in Section 8 ("Certain Information Concerning
the Purchaser and Parent") of the Offer to Purchase is incorporated herein by
reference.
4
<PAGE>
(b) The information set forth in "Introduction", Section 8 ("Certain
Information Concerning the Purchaser and Parent") and Section 10 ("Background
of the Offer; Contacts with the Company; the Merger Agreement") of the Offer
to Purchase is incorporated herein by reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a)-(b) The information set forth in Section 9 ("Financing of the Offer and
the Merger") of the Offer to Purchase is incorporated herein by reference.
(c) Not applicable.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER.
(a)-(e) The information set forth in "Introduction", Section 10 ("Background
of the Offer; Contacts with the Company; the Merger Agreement") and Section 11
("Purpose of the Offer; Plans for the Company After the Offer and the Merger")
of the Offer to Purchase is incorporated herein by reference.
(f) and (g) The information set forth in Section 13 ("Effect of the Offer on
the Market for the Shares, Exchange Listing and Exchange Act Registration") of
the Offer to Purchase is incorporated herein by reference.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a) The information set forth in "Introduction", Section 8 ("Certain
Information Concerning the Purchaser and Parent") and Section 10 ("Background
of the Offer; Contacts with the Company; the Merger Agreement") of the Offer
to Purchase is incorporated herein by reference.
(b) The information set forth in "Introduction", Section 8 ("Certain
Information Concerning the Purchaser and Parent") and Section 10 ("Background
of the Offer; Contacts with the Company; the Merger Agreement") of the Offer
to Purchase 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 "Introduction", Section 8 ("Certain Information
Concerning the Purchaser and Parent") and Section 10 ("Background of the
Offer; Contacts with the Company; the Merger Agreement") of the Offer to
Purchase is incorporated herein by reference.
ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
The information set forth in "Introduction" and Section 16 ("Fees and
Expenses") of the Offer to Purchase is incorporated herein by reference.
ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS.
The information set forth in Section 8 ("Certain Information Concerning the
Purchaser and Parent") of the Offer to Purchase is incorporated herein by
reference.
The incorporation by reference herein of the above-referenced financial
information does not constitute an admission that such information is material
to a decision by a security holder of the Company whether to sell, tender or
hold securities being sought in the Offer.
ITEM 10. ADDITIONAL INFORMATION.
(a) Not applicable.
5
<PAGE>
(b)-(c) The information set forth in Section 15 ("Certain Legal Matters and
Regulatory Approvals") of the Offer to Purchase is incorporated herein by
reference.
(d) Not applicable.
(e) None.
(f) The information set forth in the Offer to Purchase is incorporated
herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
<TABLE>
<C> <S>
(a)(1) Offer to Purchase dated May 11, 1999.
(a)(2) Letter of Transmittal.
(a)(3) Notice of Guaranteed Delivery.
(a)(4) Letter to brokers, dealers, commercial banks, trust companies and
nominees.
(a)(5) Letter to clients for use by brokers, dealers, commercial banks, trust
companies and nominees.
(a)(6) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9.
(a)(7) Form of Summary Advertisement as published in THE WALL STREET JOURNAL
on May 11, 1999.
(a)(8) Text of press release issued on May 5, 1999. (1) (exhibit 99.1)
(b)(1) Commitment Letter, dated May 3, 1999, from Wells Fargo Bank, N.A. to
Parent. (1) (exhibit 2.2)
(b)(2) Commitment Letter, dated May 3, 1999, from Morgan Stanley & Co.
Incorporated to Parent. (1) (exhibit 2.3)
(b)(3) Securities Purchase Agreement, dated as of May 5, 1999, by and between
RCBA Strategic Partners, L.P. and Parent. (1) (exhibit 2.4)
(c)(1) Agreement and Plan of Merger, dated as of May 5, 1999, among Parent,
the Purchaser and the Company. (1) (exhibit 2.1)
(d) None
(e) Not applicable.
(f) None.
</TABLE>
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(1) Incorporated by reference to the indicated exhibits to Parent's Current
Report on Form 8-K filed May 7, 1999 (File No. 001-07567).
6
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this statement is true, complete and correct.
Dated: May 11, 1999
URS CORPORATION
/s/ Kent P. Ainsworth
By: _________________________________
Name: Kent P. Ainsworth
Title: Executive Vice President and
Chief Financial Officer
DEMETER ACQUISITION CORPORATION
/s/ Kent P. Ainsworth
By: _________________________________
Name: Kent P. Ainsworth
Title: Chief Financial Officer and
Treasurer
7
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
No.
-------
<C> <S>
(a)(1) Offer to Purchase dated May 11, 1999.
(a)(2) Letter of Transmittal.
(a)(3) Notice of Guaranteed Delivery.
(a)(4) Letter to brokers, dealers, commercial banks, trust companies and
nominees.
(a)(5) Letter to clients for use by brokers, dealers, commercial banks, trust
companies and nominees.
(a)(6) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9.
(a)(7) Form of Summary Advertisement as published in THE WALL STREET JOURNAL
on May 11, 1999.
(a)(8) Text of press release issued on May 5, 1999. (1) (exhibit 99.1)
(b)(1) Commitment Letter, dated May 3, 1999, from Wells Fargo Bank, N.A. to
Parent. (1) (exhibit 2.2)
(b)(2) Commitment Letter, dated May 3, 1999, from Morgan Stanley & Co.
Incorporated to Parent. (1) (exhibit 2.3)
(b)(3) Securities Purchase Agreement, dated as of May 5, 1999, by and between
RCBA Strategic Partners, L.P. and Parent. (1) (exhibit 2.4)
(c)(1) Agreement and Plan of Merger, dated as of May 5, 1999, among Parent,
the Purchaser and the Company. (1) (exhibit 2.1)
(d) None.
(e) Not applicable.
(f) None.
</TABLE>
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(1) Incorporated by reference to the indicated exhibits to Parent's Current
Report on Form 8-K filed May 7, 1999 (File No. 001-07567).
8
<PAGE>
Offer To Purchase For Cash
All Outstanding Shares Of Common Stock
(Including the Associated Preferred Stock Purchase Rights)
of
Dames & Moore Group
at
$16.00 Net Per Share
by
Demeter Acquisition Corporation
a wholly owned subsidiary of
URS Corporation
-----------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON TUESDAY, JUNE 8, 1999, UNLESS THE OFFER IS EXTENDED.
-----------------
THE OFFER IS BEING MADE PURSUANT TO AN AGREEMENT AND PLAN OF MERGER, DATED AS
OF MAY 5, 1999, AMONG URS CORPORATION, DEMETER ACQUISITION CORPORATION AND
DAMES & MOORE GROUP (THE "COMPANY"). THE OFFER IS CONDITIONED UPON, AMONG
OTHER THINGS, THERE HAVING BEEN VALIDLY TENDERED AND NOT WITHDRAWN PRIOR TO
THE EXPIRATION OF THE OFFER AT LEAST A MAJORITY OF THE SHARES OF COMMON STOCK
(TOGETHER WITH THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS, THE "SHARES")
OF THE COMPANY THEN OUTSTANDING ON A FULLY DILUTED BASIS AND IS ALSO SUBJECT
TO CUSTOMARY CLOSING CONDITIONS, INCLUDING (i) THE EXPIRATION OR TERMINATION
OF ANY APPLICABLE WAITING PERIODS IMPOSED BY THE HART-SCOTT-RODINO ANTITRUST
IMPROVEMENTS ACT OF 1976, AS AMENDED, AND (ii) CONDITIONS TO THE FINANCING
COMMITMENTS OBTAINED BY URS CORPORATION. SEE SECTIONS 9 AND 14.
-----------------
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED AND FOUND
ADVISABLE THE MERGER AGREEMENT, THE OFFER AND THE MERGER REFERRED TO HEREIN,
DETERMINED THAT THE TERMS OF THE OFFER AND THE MERGER ARE FAIR TO, AND IN THE
BEST INTERESTS OF, THE STOCKHOLDERS OF THE COMPANY AND RECOMMENDS THAT
STOCKHOLDERS OF THE COMPANY ACCEPT THE OFFER AND TENDER ALL THEIR SHARES
PURSUANT TO THE OFFER.
-----------------
IMPORTANT
Any stockholder desiring to tender all or any portion of such stockholder's
Shares should either (1) complete and sign the Letter of Transmittal (or a
facsimile thereof) in accordance with the instructions in the Letter of
Transmittal and (a) mail or deliver it together with the certificate(s)
evidencing tendered Shares, and any other required documents, to the
Depositary or (b) tender such Shares pursuant to the procedures for book-entry
transfer set forth in Section 3, or (2) request such stockholder's broker,
dealer, commercial bank, trust company or other nominee to effect the
transaction for such stockholder. Any stockholder whose Shares are 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 such stockholder desires to tender such Shares.
A stockholder who desires to tender Shares and whose certificates evidencing
such Shares are not immediately available, or who cannot comply with the
procedures for book-entry transfer on a timely basis, may tender such Shares
by following the procedures for guaranteed delivery set forth in Section 3.
Questions or requests for assistance may be directed to D.F. King & Co., Inc
(the "Information Agent") or to Morgan Stanley & Co. Incorporated (the "Dealer
Manager") at their respective addresses and telephone numbers set forth on the
back cover of this Offer to Purchase. Additional copies of this Offer to
Purchase, the Letter of Transmittal and the Notice of Guaranteed Delivery may
also be obtained from the Information Agent, the Dealer Manager or from
brokers, dealers, commercial banks or trust companies.
-----------------
The Dealer Manager for the Offer is:
MORGAN STANLEY DEAN WITTER
May 11, 1999
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C>
Introduction............................................................ 3
1.Terms of the Offer................................................... 4
2.Acceptance for Payment and Payment for Shares........................ 6
3.Procedures for Accepting the Offer and Tendering Shares.............. 6
4.Withdrawal Rights.................................................... 9
5.Certain United States Federal Income Tax Consequences................ 9
6.Price Range of Shares; Dividends..................................... 10
7.Certain Information Concerning the Company........................... 11
8.Certain Information Concerning the Purchaser and Parent.............. 13
9.Financing of the Offer and The Merger................................ 15
10.Background of the Offer; Contacts with the Company; The Merger
Agreement.......................................................... 18
11.Purpose of the Offer; Plans for the Company After the Offer and the
Merger............................................................. 30
12.Dividends and Distributions.......................................... 32
13.Effect of the Offer on the Market for the Shares, Exchange Listing
and Exchange Act Registration...................................... 32
14.Certain Conditions of the Offer...................................... 33
15.Certain Legal Matters and Regulatory Approvals....................... 35
16.Fees and Expenses.................................................... 37
17.Miscellaneous........................................................ 37
Schedule I--Directors and Executive Officers of Parent and Purchaser.... 39
</TABLE>
<PAGE>
To the Holders of Common Stock of
Dames & Moore Group:
INTRODUCTION
Demeter Acquisition Corporation, a Delaware corporation (the "Purchaser")
and a wholly owned subsidiary of URS Corporation, a Delaware corporation
("Parent"), hereby offers to purchase all outstanding shares of common stock,
par value $0.01 per share ("Common Stock", and together with the associated
preferred stock purchase rights, the "Shares"), of Dames & Moore Group, a
Delaware corporation (the "Company"), at $16.00 per Share (the "Offer Price"),
net to the seller in cash, without interest, upon the terms and subject to the
conditions set forth in this Offer to Purchase and in the related Letter of
Transmittal (which, together with any amendments or supplements hereto or
thereto, collectively constitute the "Offer").
Tendering stockholders whose Shares are registered in their own name and who
tender directly to the Depositary (as defined below) will not be obligated to
pay brokerage fees or commissions to the Purchaser or the Depositary or,
except as set forth in Instruction 6 of the Letter of Transmittal, U.S.
Federal, state or local transfer taxes on the purchase of Shares pursuant to
the Offer. Stockholders who hold their Shares through a bank or broker should
check with such institution as to whether they charge any service fees. The
Purchaser will pay the fees and expenses of Morgan Stanley & Co. Incorporated,
which is acting as the Dealer Manager (the "Dealer Manager"), ChaseMellon
Shareholder Services, L.L.C., which is acting as the Depositary (the
"Depositary"), and D.F. King & Co., Inc., which is acting as Information Agent
(the "Information Agent"), incurred in connection with the Offer. See Section
16.
The Offer is being made pursuant to the Agreement and Plan of Merger, dated
as of May 5, 1999 (the "Merger Agreement"), among Parent, the Purchaser and
the Company, pursuant to which, following the consummation of the Offer and
the satisfaction or waiver of certain conditions, the Purchaser will be merged
with and into the Company, with the Company surviving the merger (as such, the
"Surviving Corporation") as a wholly owned subsidiary of Parent (the
"Merger"). On the effective date of the Merger, each outstanding Share not
tendered in the Offer (other than Shares owned by the Company as treasury
stock or by Parent, the Purchaser or any other direct or indirect wholly owned
subsidiary of Parent, or by stockholders, if any, who are entitled to and who
properly exercise dissenters' rights under Delaware law) will be converted
into the right to receive the Offer Price in cash, without interest (the
"Merger Consideration"). See Section 10.
The Merger is subject to a number of conditions, including approval by
stockholders of the Company, if applicable law requires such approval, and
Shares having been purchased pursuant to the Offer. In the event the Purchaser
acquires 90% or more of the outstanding Shares pursuant to the Offer or
otherwise, the Purchaser would be able to effect the Merger pursuant to the
short-form merger provisions of the Delaware General Corporation Law (the
"DGCL"), without prior notice to, or any action by, any other stockholder of
the Company. In such event, the Purchaser could, and intends to, effect the
Merger without prior notice to, or any action by, any other stockholder of the
Company. See Section 10.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE HAVING BEEN VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER AT LEAST A
MAJORITY OF THE SHARES THEN OUTSTANDING ON A FULLY DILUTED BASIS (THE "MINIMUM
CONDITION") AND IS ALSO SUBJECT TO CUSTOMARY CLOSING CONDITIONS, INCLUDING (I)
THE EXPIRATION OR TERMINATION OF ANY APPLICABLE WAITING PERIODS IMPOSED BY THE
HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT OF 1976, AS AMENDED (THE "HSR
ACT"), AND (II) CONDITIONS TO THE FINANCING COMMITMENTS OBTAINED BY PURCHASER.
SEE SECTIONS 9 AND 14, WHICH SET FORTH IN FULL THE CONDITIONS TO THE OFFER.
THE BOARD OF DIRECTORS OF THE COMPANY (THE "BOARD") HAS APPROVED AND FOUND
ADVISABLE, THE MERGER AGREEMENT, THE OFFER AND THE MERGER, DETERMINED THAT THE
TERMS OF THE OFFER AND THE MERGER ARE FAIR TO, AND IN THE BEST INTERESTS OF,
THE STOCKHOLDERS OF THE COMPANY, AND RECOMMENDS THAT STOCKHOLDERS OF THE
COMPANY ACCEPT THE OFFER AND TENDER ALL THEIR SHARES PURSUANT TO THE OFFER.
3
<PAGE>
Prudential Securities Incorporated ("Prudential Securities"), the Company's
financial advisor, has delivered to the Board its written opinion dated May 5,
1999 that, as of such date and based upon and subject to the matters set forth
therein, the consideration to be received by the holders of the Shares in the
Offer and the Merger is fair from a financial point of view. Such opinion is
set forth in full as an exhibit to the Company's Solicitation/ Recommendation
Statement on Schedule 14D-9 (the "Schedule 14D-9"), which is being mailed to
stockholders of the Company concurrently herewith.
The Company has informed the Purchaser that, as of April 30, 1999, there
were 18,595,311 shares of Common Stock issued and outstanding, 1,899,978
shares of Common Stock reserved for issuance upon exercise of outstanding
Company Stock Options (as defined in the Merger Agreement) (997,273 of which
were subject to Company Stock Options with an exercise price that is less than
the Offer Price) and 4,346,024 shares of Common Stock held by the Company in
its treasury. Based upon the foregoing, the Purchaser believes that
approximately 10,247,645 shares of Common Stock constitute a majority of the
fully diluted Shares.
The Merger Agreement is more fully described in Section 10. Certain Federal
income tax consequences of the sale of Shares pursuant to the Offer and the
exchange of Shares for the Merger Consideration (as defined in Section 10 "--
Conversion of Securities") pursuant to the Merger are described in Section 5.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION THAT SHOULD BE READ BEFORE ANY DECISION IS MADE WITH
RESPECT TO THE OFFER.
1.TERMS OF THE OFFER
Upon the terms and subject to the conditions of the Offer, the Purchaser
will accept for payment, and pay for, all Shares validly tendered prior to the
Expiration Date and not theretofore properly withdrawn in accordance with
Section 3. The term "Expiration Date" means 12:00 Midnight, New York City
time, on Tuesday, June 8, 1999, unless and until the Purchaser, in its sole
discretion (but subject to 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 the Purchaser, shall expire.
The Purchaser expressly reserves the right, in its sole discretion (but
subject to the terms of the Merger Agreement and the applicable rules and
regulations of the Securities and Exchange Commission (the "Commission")), at
any time and from time to time, and regardless of whether or not any of the
events set forth in Section 14 hereof shall have occurred, to (i) extend the
period of time during which the Offer is open and thereby delay acceptance for
payment of, and the payment for, any Shares, by giving oral or written notice
of such extension to the Depositary and (ii) amend the Offer in any other
respect by giving oral or written notice of such amendment to the Depositary.
UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID BY THE PURCHASER ON THE PURCHASE
PRICE OF THE SHARES, REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY DELAY IN
MAKING SUCH PAYMENT.
If by 12:00 Midnight, New York City time, on Tuesday, June 8, 1999 (or any
other date or time then set as the Expiration Date), any or all conditions to
the Offer have not been satisfied or waived, the Purchaser reserves the right
(but shall not be obligated), subject to the terms and conditions contained in
the Merger Agreement and to the applicable rules and regulations of the
Commission, to (i) terminate the Offer and not accept for payment any Shares
and return all tendered Shares to tendering stockholders, (ii) waive all the
unsatisfied conditions (other than the Minimum Condition) and, subject to
complying with the terms of the Merger Agreement and the applicable rules and
regulations of the Commission, accept for payment, and pay for, all Shares
validly tendered prior to the Expiration Date and not theretofore withdrawn,
(iii) extend the Offer and, subject to the right of stockholders to withdraw
Shares until the Expiration Date, retain the Shares that have been tendered
during the period or periods for which the Offer is extended, or (iv) amend
the Offer.
There can be no assurance that the Purchaser will exercise its right to
extend the Offer (other than as may be required by the Merger Agreement or by
applicable law). Any extension, waiver, amendment or termination will be
followed as promptly as practicable by public announcement. In the case of an
extension, Rule 14e-1(d)
4
<PAGE>
under the Securities Exchange Act of 1934, as amended (the "Exchange Act"),
requires that the announcement be issued no later than 9:00 a.m., New York
City time, on the next business day after the previously scheduled Expiration
Date in accordance with the public announcement requirements of Rule 14d-4(c)
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 the Purchaser may choose to make any public announcement, the
Purchaser will not have any obligation to publish, advertise or otherwise
communicate any such public announcement other than by issuing a press release
to the Dow Jones News Service.
In the Merger Agreement, Parent and the Purchaser have agreed that if on any
scheduled Expiration Date of the Offer, all conditions set forth in Section 14
have not been satisfied or waived, the Purchaser may, and at the request of
the Company shall, from time to time, extend the expiration date of the Offer
for up to ten additional business days, and the Purchaser may, without the
consent of Company, (A) extend the Offer for any period required by any rule,
regulation, interpretation or position of the Commission or the Commission
staff applicable to the Offer, and (B) extend the Offer for up to ten business
days if there have been validly tendered and not withdrawn prior to the
expiration of the Offer such number of Shares that would constitute at least
75% but less than 90% of the issued and outstanding Shares as of the date of
determination. As used in this Offer to Purchase, "business day" has the
meaning set forth in Rule 14d-1(e)(6) under the Exchange Act.
In addition, the Purchaser has agreed in the Merger Agreement that it will
not, without the express written consent of the Company, (i) reduce the number
of Shares subject to the Offer, (ii) reduce the Offer Price, (iii) add to or
modify the conditions set forth in Section 14, (iv) change the Expiration
Date, except as provided above, (v) change the form of consideration payable
in the Offer (vi) amend, alter, add or waive any term of the Offer in any
manner adverse to the Company's stockholders or (vii) waive the Minimum
Condition.
If the Purchaser extends the Offer or if the Purchaser (whether before or
after its acceptance for payment of Shares) is delayed in its acceptance for
payment of or payment for Shares or is unable to pay for Shares pursuant to
the Offer for any reason, then, without prejudice to the Purchaser's rights
under the Offer, the Depositary may retain tendered Shares on behalf of the
Purchaser, and such Shares may not be withdrawn except to the extent tendering
stockholders are entitled to withdrawal rights as described in Section 4.
However, the ability of the Purchaser to delay the payment for Shares that the
Purchaser has accepted for payment is limited by Rule 14e-1 under the Exchange
Act, which requires that a bidder pay the consideration offered or return the
securities deposited by or on behalf of holders of securities promptly after
the termination or withdrawal of such bidder's offer.
If the 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,
the Purchaser will disseminate additional tender offer materials and extend
the Offer to the extent required by Rules 14d-4(c), 14d-6(d) and 14e-1 under
the Exchange Act. The minimum period during which an offer must remain open
following material changes in the terms of the Offer or information concerning
the Offer, other than a change in price or a change in the percentage of
securities sought or any dealer solicitation fee, will depend upon the facts
and circumstances then existing, including the relative materiality of the
changed terms or information. With respect to a change in price or a change in
the percentage of securities sought, a minimum period of ten business days is
generally required to allow for adequate dissemination to stockholders.
The Offer is conditioned upon satisfaction of the Minimum Condition and
other customary closing conditions, including (i) the expiration or
termination of any applicable waiting periods imposed by the HSR Act and (ii)
conditions to the financing commitments obtained by Parent. See Sections 9 and
14. Subject to the terms and conditions contained in the Merger Agreement, the
Purchaser reserves the right (but shall not be obligated) to waive any or all
such conditions (other than the Minimum Condition).
5
<PAGE>
The Company has provided the Purchaser with the Company's stockholder lists
and security position listings for the purpose of disseminating the Offer to
holders of the Shares. This Offer to Purchase, the related 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 lists 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.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 such extension
or amendment), the Purchaser will accept for payment, and will pay for, all
Shares validly tendered on or prior to the Expiration Date and not properly
withdrawn promptly after the later to occur of (i) the Expiration Date, (ii)
the expiration or termination of any applicable waiting periods under the HSR
Act, and (iii) the satisfaction or waiver of the conditions to the Offer set
forth in Section 14. Subject to applicable rules of the Commission and to the
terms of the Merger Agreement, the Purchaser expressly reserves the right to
delay acceptance for payment of, or payment for, Shares pending receipt of any
regulatory approvals specified in Section 15 or in order to comply in whole or
in part with any other applicable law.
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 certificates evidencing such Shares (the "Share Certificates") or timely
confirmation (a "Book-Entry Confirmation") of a book-entry transfer of such
Shares into the Depositary's account at The Depository Trust Company (the
"Book-Entry Transfer Facility") pursuant to the procedures set forth in
Section 3, (ii) the Letter of Transmittal (or a facsimile thereof), properly
completed and duly executed, with any required signature guarantees, or an
Agent's Message (as defined below) in connection with a book-entry transfer,
and (iii) any other documents required by the Letter of Transmittal.
The term "Agent's Message" means a message, transmitted by the Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of a
Book-Entry Confirmation, that states that such Book-Entry Transfer Facility
has received an express acknowledgment from the participant in such Book-Entry
Transfer Facility tendering the Shares, that such participant has received and
agrees to be bound by the terms of the Letter of Transmittal and that the
Purchaser may enforce such agreement against such participant.
For purposes of the Offer, the Purchaser will be deemed to have accepted for
payment (and thereby purchased) Shares validly tendered and not properly
withdrawn as, if and when the Purchaser gives oral or written notice to the
Depositary of the Purchaser's acceptance for payment of such Shares pursuant
to the Offer. 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 receiving payments from
the Purchaser and transmitting such payments to tendering stockholders whose
Shares have been accepted for payment. UNDER NO CIRCUMSTANCES WILL INTEREST ON
THE PURCHASE PRICE FOR SHARES BE PAID, REGARDLESS OF ANY EXTENSION OF THE
OFFER OR ANY DELAY IN MAKING SUCH PAYMENT.
If any tendered Shares are not accepted for payment for any reason pursuant
to the terms and conditions of the Offer, Share Certificates evidencing
unpurchased Shares will be returned, without expense to the tendering
stockholder (or, in the case of Shares tendered by book-entry transfer into
the Depositary's account at the Book-Entry Transfer Facility pursuant to the
procedures set forth in Section 3, 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.
3.PROCEDURES FOR ACCEPTING THE OFFER AND TENDERING SHARES
In order for a holder of Shares validly to tender Shares pursuant to the
Offer, the Letter of Transmittal (or a facsimile thereof), properly completed
and duly executed, together with any required signature guarantees, or an
6
<PAGE>
Agent's Message in connection with a book-entry transfer of Shares, and any
other documents required by the Letter of Transmittal, must be received by the
Depositary at its address set forth on the back cover of this Offer to
Purchase and either (i) the Share Certificates evidencing tendered Shares must
be received by the Depositary at such address or such Shares must be tendered
pursuant to the procedures for book-entry transfer described below and a Book-
Entry Confirmation must be received by the Depositary, in each case on or
prior to the Expiration Date, or (ii) the tendering stockholder must comply
with the guaranteed delivery procedures described below.
THE METHOD OF DELIVERY OF SHARE CERTIFICATES AND ALL OTHER REQUIRED
DOCUMENTS, INCLUDING DELIVERY THROUGH THE BOOK-ENTRY TRANSFER FACILITY, IS AT
THE OPTION AND RISK OF THE TENDERING STOCKHOLDER. 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.
Book-Entry Transfer. The Depositary will establish an account with respect
to the Shares at 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 system of the Book-Entry
Transfer Facility may make a book-entry delivery of Shares by causing such
Book-Entry Transfer Facility to transfer such Shares into the Depositary's
account at such Book-Entry Transfer Facility in accordance with such Book-
Entry Transfer Facility's procedures for such transfer. However, although
delivery of Shares may be effected through book-entry transfer at the Book-
Entry Transfer Facility, the Letter of Transmittal (or a 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 any other required documents, must, in any case, be received by the
Depositary at its address set forth on the back cover of this Offer to
Purchase on or prior to the Expiration Date, or the tendering stockholder must
comply with the guaranteed delivery procedures described below. DELIVERY OF
DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO
THE DEPOSITARY.
Signature Guarantees. Signatures on all Letters of Transmittal must be
guaranteed by a firm that is a member of the Securities Transfer Agents
Medallion Program, or by any other "eligible guarantor institution," as such
term is defined in Rule 17Ad-15 under the Exchange Act (each of the foregoing
being referred to as an "Eligible Institution"), except in cases where Shares
are tendered (i) by a registered holder of Shares who has not completed either
the box entitled "Special Payment Instructions" or the box entitled "Special
Delivery Instructions" on the Letter of Transmittal or (ii) for the account of
an Eligible Institution. If a Share Certificate is registered in the name of a
person other than the person who or that signs the Letter of Transmittal, or
if payment is to be made, or a Share Certificate not accepted for payment or
not tendered is to be returned, to a person other than the registered
holder(s), then the Share Certificate must be endorsed or accompanied by
appropriate stock powers, in either case signed exactly as the name(s) of the
registered holder(s) appear on the Share Certificate, with the signature(s) on
such Share Certificate or stock powers guaranteed by an Eligible Institution.
See Instructions 1 and 5 of the Letter of Transmittal.
Guaranteed Delivery. If a stockholder desires to tender Shares pursuant to
the Offer and such stockholder's Share Certificates evidencing such Shares are
not immediately available or such stockholder cannot deliver the Share
Certificates and all other required documents to the Depositary prior to the
Expiration Date, or such stockholder cannot complete the procedures for
delivery by book-entry transfer on a timely basis, such Shares may
nevertheless be tendered, provided that all the following conditions are
satisfied:
(i) such tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed Delivery,
substantially in the form made available by the Purchaser, is received
by the Depositary on or prior to the Expiration Date as provided
below; and
(iii) the Share Certificates (or a Book-Entry Confirmation) evidencing all
tendered Shares, in proper form for transfer, in each case together
with the Letter of Transmittal (or a facsimile thereof), properly
7
<PAGE>
completed and duly executed, with any required signature guarantees (or,
in the case of a book-entry transfer, an Agent's Message), and any other
documents required by the Letter of Transmittal, are received by the
Depositary within three New York Stock Exchange ("NYSE") trading days
after the date of execution of such Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand or mail or
transmitted by telegram or facsimile transmission to the Depositary and must
include a guarantee by an Eligible Institution in the form set forth in the
form of Notice of Guaranteed Delivery made available by the Purchaser.
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 the
Share Certificates evidencing such Shares, or a Book-Entry Confirmation of the
delivery of such Shares, and the Letter of Transmittal (or a 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), and
any other documents required by the Letter of Transmittal.
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 the Purchaser in its sole discretion,
which determination will be final and binding on all parties. The Purchaser
reserves the absolute right to reject any and all tenders determined by it not
to be in proper form or the acceptance for payment of which may, in the opinion
of its counsel, be unlawful. The Purchaser also reserves the absolute right to
waive any condition of the Offer (other than the Minimum Condition) or any
defect or irregularity, in the tender of any Shares of any particular
stockholder, whether or not similar defects or irregularities are waived in the
case of other stockholders. No tender of Shares will be deemed to have been
validly made until all defects and irregularities have been cured or waived.
None of the Purchaser, Parent, the Dealer Manager, the Depositary, the
Information Agent or any other person will be under any duty to give
notification of any defects or irregularities in tenders or incur any liability
for failure to give any such notification. The 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.
Appointment. By executing the Letter of Transmittal as set forth above, a
tendering stockholder irrevocably appoints designees of the 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 the Purchaser (and with respect to any and all other Shares or other
securities issued or issuable in respect of such Shares on or after May 11,
1999). All such proxies will be considered coupled with an interest in the
tendered Shares. Such appointment will be effective when, and only to the
extent that, the Purchaser accepts such Shares for payment. Upon such
acceptance for payment, all prior proxies given by such stockholder with
respect to such Shares (and such other Shares and securities) will be revoked
without further action, and no subsequent proxies may be given nor any
subsequent written consent executed by such stockholder (and, if given or
executed, will not be deemed to be effective) with respect thereto. The
designees of the Purchaser will, with respect to the Shares (and such other
Shares and securities) 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 at any annual or special meeting of the Company's
stockholders or any adjournment or postponement thereof, by written consent in
lieu of any such meeting or otherwise. The Purchaser reserves the right to
require that, in order for Shares to be deemed validly tendered, immediately
upon the Purchaser's payment for such Shares, the Purchaser must be able to
exercise full voting rights with respect to such Shares (and such other Shares
and securities).
The acceptance for payment by the Purchaser of Shares pursuant to any of the
procedures described above will constitute a binding agreement between the
tendering stockholder and the Purchaser upon the terms and subject to the
conditions of the Offer.
UNDER UNITED STATES FEDERAL INCOME TAX LAWS, THE DEPOSITARY WILL BE REQUIRED
TO WITHHOLD 31% OF THE AMOUNT OF ANY PAYMENTS MADE TO CERTAIN STOCKHOLDERS
PURSUANT TO THE OFFER ("BACKUP WITHHOLDING") UNLESS SUCH STOCKHOLDER PROVIDES
THE DEPOSITARY WITH APPROPRIATE CERTIFICATION SUCH AS THE STOCKHOLDER'S
8
<PAGE>
CORRECT TAXPAYER IDENTIFICATION NUMBER AND A CERTIFICATION THAT SUCH
STOCKHOLDER IS NOT SUBJECT TO BACKUP WITHHOLDING BY COMPLETING THE SUBSTITUTE
FORM W-9 IN THE LETTER OF TRANSMITTAL. SEE INSTRUCTION 9 OF THE LETTER OF
TRANSMITTAL.
4.WITHDRAWAL RIGHTS
Tenders of Shares made pursuant to the Offer are irrevocable except that
such Shares may be withdrawn at any time prior to the Expiration Date and,
unless theretofore accepted for payment by the Purchaser pursuant to the
Offer, may also be withdrawn at any time after July 9, 1999. If the Purchaser
extends the Offer, is delayed in its acceptance for payment of Shares or is
unable to accept Shares for payment pursuant to the Offer for any reason,
then, without prejudice to the Purchaser's rights under the Offer, the
Depositary may, nevertheless, on behalf of the Purchaser, retain tendered
Shares, and such Shares may not be withdrawn except to the extent that
tendering stockholders are entitled to withdrawal rights as described in this
Section 4. Any such delay will be by an extension of the Offer to the extent
required by law.
For a withdrawal to be effective, a written, telegraphic or facsimile
transmission notice of withdrawal must be timely received by the Depositary at
its address set forth on the back cover page of this Offer to Purchase. Any
such notice of withdrawal must specify the name of the person who tendered the
Shares to be withdrawn, the number of Shares to be withdrawn and the name of
the registered holder of such Shares, if different from that of the person who
tendered such Shares. If Share Certificates evidencing Shares to be withdrawn
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 submitted to the Depositary and the
signature(s) on the notice of withdrawal must be guaranteed by an Eligible
Institution, unless such Shares have been tendered for the account of an
Eligible Institution. If Shares have been tendered pursuant to the procedures
for book-entry transfer as set forth in Section 3, 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, in which case a
notice of withdrawal will be effective if delivered to the Depositary by any
method described in the first sentence of this paragraph.
All questions as to the form and validity (including time of receipt) of any
notice of withdrawal will be determined by the Purchaser, in its sole
discretion, whose determination will be final and binding. None of the
Purchaser, Parent, the Dealer Manager, the Depositary, the Information Agent
or any other person will be under any duty to give notification of any defects
or irregularities in any notice of withdrawal or incur any liability for
failure to give any such notification.
Any Shares properly withdrawn will thereafter be deemed not to have been
validly tendered for purposes of the Offer. However, withdrawn Shares may be
re-tendered at any time prior to the Expiration Date by following one of the
procedures described in Section 3.
5.CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES
Sales of Shares pursuant to the Offer (and the receipt of cash by
stockholders of the Company pursuant to the Merger) will be taxable
transactions for United States Federal income tax purposes under the Internal
Revenue Code of 1986, as amended (the "Code"), and may also be taxable
transactions under applicable state, local, foreign and other tax laws. For
United States Federal income tax purposes, a tendering stockholder will
generally recognize gain or loss equal to the difference between the amount of
cash received by the stockholder pursuant to the Offer (or pursuant to the
Merger) and the aggregate tax basis in the Shares tendered by the stockholder
and purchased pursuant to the Offer (or cancelled pursuant to the Merger).
Gain or loss will be calculated separately for each block of Shares tendered
and purchased pursuant to the Offer (or cancelled pursuant to the Merger).
If tendered Shares are held by a tendering stockholder as capital assets,
gain or loss recognized by the tendering stockholder will be capital gain or
loss, which will be long-term capital gain or loss if the tendering
stockholder's holding period for the Shares exceeds one year. Long-term
capital gains recognized by a tendering individual stockholder will generally
be taxed at a maximum Federal marginal tax rate of 20%, and long-term capital
gains recognized by a tendering corporate stockholder will be taxed at a
maximum Federal marginal tax rate of 35%.
9
<PAGE>
A stockholder (other than certain exempt stockholders including, among
others, all corporations and certain foreign individuals) that tenders Shares
may be subject to 31% backup withholding unless the stockholder provides its
taxpayer identification number ("TIN") and certifies that such number is
correct or properly certifies that it is awaiting a TIN and certifies as to no
loss of exemption from backup withholding and otherwise complies with the
applicable requirements of the backup withholding rules. A stockholder that
does not furnish its correct TIN or that does not otherwise establish a basis
for an exemption from backup withholding may be subject to a penalty imposed
by the Internal Revenue Service. Each stockholder should complete and sign the
Substitute Form W-9 included as part of the Letter of Transmittal so as to
provide the information and certification necessary to avoid backup
withholding.
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
Internal Revenue Service. If backup withholding results in an overpayment of
tax, the stockholder upon filing an income tax return can obtain a refund.
THE FOREGOING DISCUSSION MAY NOT BE APPLICABLE WITH RESPECT TO SHARES
RECEIVED AS COMPENSATION OR WITH RESPECT TO HOLDERS OF SHARES WHO ARE SUBJECT
TO SPECIAL TAX TREATMENT UNDER THE CODE, SUCH AS NON-U.S. PERSONS, LIFE
INSURANCE COMPANIES, TAX-EXEMPT ORGANIZATIONS AND FINANCIAL INSTITUTIONS, AND
MAY NOT APPLY TO A HOLDER OF SHARES IN LIGHT OF ITS INDIVIDUAL CIRCUMSTANCES,
SUCH AS PERSONS WHO HOLD THEIR SHARES AS A HEDGE OR AS PART OF A HEDGING,
STRADDLE, CONVERSION OR OTHER RISK REDUCTION TRANSACTION. STOCKHOLDERS ARE
URGED TO CONSULT THEIR TAX ADVISORS TO DETERMINE THE PARTICULAR TAX
CONSEQUENCES TO THEM (INCLUDING THE APPLICATION AND EFFECT OF ANY STATE, LOCAL
OR FOREIGN INCOME AND OTHER TAX LAWS) OF THE OFFER AND THE MERGER.
6.PRICE RANGE OF SHARES; DIVIDENDS
The Shares have been listed and traded principally on the NYSE since March
12, 1992 under the symbol "DM." As of May 7, 1999, the Shares were held by 328
holders of record. The following table reflects the high and low sales prices
and cash dividends declared per Share for fiscal years 1999 and 1998 and for
the first quarter of fiscal 2000 (through May 10, 1999).
<TABLE>
<CAPTION>
HIGH LOW DIVIDENDS
---- ---- ---------
<S> <C> <C> <C>
2000:
First Quarter (through May 10, 1999)........... $15 1/2 $ 9 13/16 --
1999:
Fourth Quarter................................. 12 15/16 7 15/16 0.03
Third Quarter.................................. 12 15/16 9 3/4 0.03
Second Quarter................................. 14 7/16 10 1/8 0.03
First Quarter.................................. 13 5/8 12 1/4 0.03
1998:
Fourth Quarter................................. 13 1/2 12 1/8 0.03
Third Quarter.................................. 13 3/8 11 15/16 0.03
Second Quarter................................. 13 7/8 11 3/4 0.03
First Quarter.................................. 13 1/4 11 3/8 0.03
</TABLE>
On May 5, 1999, the last full trading day prior to the announcement of the
execution of the Merger Agreement and of the Purchaser's intention to commence
the Offer, the closing price per Share as reported on the NYSE was $12 15/16.
On May 10, 1999, the last full trading day prior to the date of this Offer to
Purchase, the closing price per Share as reported on the NYSE was $15 1/2.
STOCKHOLDERS ARE URGED TO OBTAIN A CURRENT MARKET QUOTATION FOR THE SHARES.
10
<PAGE>
7.CERTAIN INFORMATION CONCERNING THE COMPANY
Except as otherwise set forth herein, the information concerning the Company
contained in this Offer to Purchase, including financial information, has been
furnished by the Company or has been taken from or based upon publicly
available documents and records on file with the Commission and other public
sources. None of the Purchaser, Parent or the Dealer Manager assumes any
responsibility for the accuracy or completeness of the information concerning
the Company, furnished by the Company or contained in such documents and
records or for any failure by the Company to disclose events that may have
occurred or may affect the significance or accuracy of any such information
but that are unknown to the Purchaser and Parent.
General. The Company is a corporation organized and existing under the laws
of the State of Delaware with its principal executive offices located at 911
Wilshire Boulevard, Suite 700, Los Angeles, CA 90017. According to the
Company's Annual Report on Form 10-K for the year ended March 27, 1998
(the "Form 10-K"), the Company is composed of a global network of professional
services companies that specializes in: general engineering and consulting;
process and chemical engineering; transportation; construction and program
management; communications and information services; and equity ventures. The
Company is the successor to the businesses of Dames & Moore, Incorporated, a
Delaware corporation, and Dames & Moore, a California limited partnership.
Originally organized in 1938, the Dames & Moore partnership incorporated on
March 12, 1992. Dames & Moore, Inc. changed its name to Dames & Moore Group in
August 1997.
Financial Information. Set forth below is certain selected consolidated
financial information relating to the Company and its subsidiaries that has
been excerpted or derived from the financial statements contained in the Form
10-K and the unaudited financial statements contained in the Company's
Quarterly Report on Form 10-Q for the quarters ended December 25, 1998 and
December 26, 1997 (the "Form 10-Qs"). More comprehensive information is
included in the Form 10-K, the Form 10-Qs and other documents (including a
Form 8-K filed August 14, 1999 and a Form 8-K/A filed October 9, 1999) filed
by the Company with the Commission. The financial information that follows is
qualified in its entirety by reference to such reports and other documents,
including the financial statements and related notes contained therein. Such
reports and other documents may be examined and copies may be obtained from
the offices of the Commission in the manner set forth below under "--Available
Information".
DAMES & MOORE GROUP
SELECTED CONSOLIDATED FINANCIAL DATA
<TABLE>
<CAPTION>
FISCAL YEAR ENDED, NINE MONTHS ENDED
----------------------------- -------------------------
MARCH 27, MARCH 28, MARCH 29, DECEMBER 25, DECEMBER 26,
1998 1997 1996 1998 1997
--------- --------- --------- ------------ ------------
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<S> <C> <C> <C> <C> <C>
EARNINGS DATA:
Gross revenues.......... $703,902 $653,378 $556,763 $740,190 $522,959
Net revenues............ 482,504 454,408 396,495 454,089 361,764
Earnings from opera-
tions.................. 42,813 36,861 36,901 10,631 32,713
Net earnings (loss)..... 19,330 18,540 22,098 (5,161) 14,989
Earnings (loss) per
share--Basic........... $ 1.08 $ 0.91 $ 0.99 $ (0.28) $ 0.84
Earnings (loss) per
share--Diluted......... $ 1.07 $ 0.91 $ 0.98 $ (0.28) $ 0.83
Cash dividends per
share.................. $ 0.12 $ 0.12 $ 0.12 $ 0.09 $ 0.09
FINANCIAL POSITION (AT
END OF PERIOD):
Current assets.......... $228,129 $208,254 $216,191 $385,476 $227,215
Current liabilities..... 98,559 92,837 70,377 172,204 93,782
Net working capital..... 129,570 115,417 145,814 213,272 133,433
Total assets............ 386,361 358,282 317,279 635,481 382,135
Long-term debt.......... 132,010 128,542 75,000 302,845 137,010
Shareholders' equity.... 149,909 131,623 167,947 144,718 144,743
BACKLOG:................ $345,000 $290,000 $252,000
</TABLE>
11
<PAGE>
Certain Company Projections. To the knowledge of Parent and the Purchaser,
the Company does not as a matter of course make public forecasts as to its
future financial performance. However, in connection with the discussions and
negotiations described in Section 10, the Company furnished Parent with
certain financial projections that Parent and the Purchaser believe are not
publicly available. Neither Parent nor the Purchaser verified the accuracy of
such financial projections.
According to the projections, the Company has estimated that in fiscal 2000
it will have approximately: gross revenues of $1.2 billion; net revenues of
$730 million; earnings from operations of $62 million; net earnings of $24
million; and earnings per share of $1.30.
IT IS THE UNDERSTANDING OF PARENT AND THE PURCHASER THAT THE PROJECTIONS
WERE NOT PREPARED WITH A VIEW TO PUBLIC DISCLOSURE OR COMPLIANCE WITH
PUBLISHED GUIDELINES OF THE COMMISSION OR THE GUIDELINES ESTABLISHED BY THE
AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS REGARDING PROJECTIONS OR
FORECASTS AND ARE INCLUDED HEREIN ONLY BECAUSE SUCH INFORMATION WAS PROVIDED
TO PARENT AND THE PURCHASER. THESE FORWARD-LOOKING STATEMENTS (AS THAT TERM IS
DEFINED IN THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995) ARE SUBJECT
TO CERTAIN RISKS AND UNCERTAINTIES THAT COULD CAUSE ACTUAL RESULTS TO DIFFER
MATERIALLY FROM THE PROJECTIONS. THE COMPANY HAS ADVISED THE PURCHASER AND
PARENT THAT ITS INTERNAL FINANCIAL FORECASTS (UPON WHICH THE PROJECTIONS
PROVIDED TO PARENT WERE BASED IN PART) ARE, IN GENERAL, PREPARED SOLELY FOR
INTERNAL USE AND CAPITAL BUDGETING AND OTHER MANAGEMENT DECISIONS, AND ARE
SUBJECTIVE IN MANY RESPECTS AND THUS SUSCEPTIBLE TO INTERPRETATIONS AND
PERIODIC REVISION BASED ON ACTUAL EXPERIENCE AND BUSINESS DEVELOPMENTS. THE
PROJECTIONS ALSO REFLECT NUMEROUS ASSUMPTIONS (NOT ALL OF WHICH WERE PROVIDED
TO THE PURCHASER OR PARENT), ALL MADE BY MANAGEMENT OF THE COMPANY, WITH
RESPECT TO INDUSTRY PERFORMANCE, GENERAL BUSINESS, ECONOMIC, MARKET AND
FINANCIAL CONDITIONS AND OTHER MATTERS, INCLUDING EFFECTIVE TAX RATES
CONSISTENT WITH HISTORICAL LEVELS FOR THE COMPANY, ALL OF WHICH ARE DIFFICULT
TO PREDICT, MANY OF WHICH ARE BEYOND THE COMPANY'S CONTROL AND NONE OF WHICH
WERE SUBJECT TO APPROVAL BY PARENT OR THE PURCHASER. ACCORDINGLY, THERE CAN BE
NO ASSURANCE THAT THE ASSUMPTIONS MADE IN PREPARING THE PROJECTIONS WILL PROVE
ACCURATE, AND ACTUAL RESULTS MAY BE MATERIALLY GREATER OR LESS THAN THOSE
CONTAINED IN THE PROJECTIONS. THE INCLUSION OF THE PROJECTIONS HEREIN SHOULD
NOT BE REGARDED AS AN INDICATION THAT ANY OF PARENT, THE PURCHASER, THE
COMPANY OR THEIR RESPECTIVE AFFILIATES OR REPRESENTATIVES CONSIDERED OR
CONSIDER THE PROJECTIONS TO BE A RELIABLE PREDICTION OF FUTURE EVENTS, AND THE
PROJECTIONS SHOULD NOT BE RELIED UPON AS SUCH. NONE OF PARENT, THE PURCHASER,
THE COMPANY OR ANY OF THEIR RESPECTIVE AFFILIATES ASSUMES ANY RESPONSIBILITY
FOR THE VALIDITY, REASONABLENESS, ACCURACY OR COMPLETENESS OF THE PROJECTIONS.
NONE OF PARENT, THE PURCHASER, THE COMPANY OR ANY OF THEIR RESPECTIVE
AFFILIATES OR REPRESENTATIVES HAS MADE, OR MAKES, ANY REPRESENTATION TO ANY
PERSON REGARDING THE INFORMATION CONTAINED IN THE PROJECTIONS AND NONE OF THEM
INTENDS TO UPDATE OR OTHERWISE REVISE THE PROJECTIONS TO REFLECT CIRCUMSTANCES
EXISTING AFTER THE DATE WHEN MADE OR TO REFLECT THE OCCURRENCE OF FUTURE
EVENTS EVEN IN THE EVENT THAT ANY OR ALL OF THE ASSUMPTIONS UNDERLYING THE
PROJECTIONS ARE SHOWN TO BE IN ERROR.
Available Information. The Shares are registered under the Exchange Act and
the Company is therefore subject to the reporting 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. Information as to particular dates
concerning the Company's directors and officers, their remuneration, stock
options granted to 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 distributed to the Company's
stockholders and filed with the Commission. Such reports, proxy statements and
other information should be available for inspection at the public reference
facilities maintained by the Commission at Room 1024, 450 Fifth Street, N.W.,
Washington, D.C. 20549, and at the following regional offices of the
Commission: New York Regional Office, Seven World Trade Center, 3rd Floor, New
York, New York 10048; and Chicago Regional Office, Citicorp Center, 500 West
Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of such materials
may be obtained by mail, upon payment of the Commission's customary fees, by
writing to its principal office at 450 Fifth Street, N.W., Washington, D.C.
20549. The Commission also maintains a Website (http://www.sec.gov) that
contains reports, proxy and information statements and other
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<PAGE>
information regarding issuers that file electronically with the Commission. In
addition, reports, proxy statements and other information concerning the
Company can be inspected and copied at the NYSE, 20 Broad Street, New York,
New York 10005, on which the Shares are listed.
8.CERTAIN INFORMATION CONCERNING THE PURCHASER AND PARENT
The Purchaser is a newly incorporated corporation organized and existing
under the laws of the State of Delaware organized in connection with the Offer
and the Merger and has not carried on any activities other than in connection
with the Offer and the Merger. The principal offices of the Purchaser are
located at 100 California Street, Suite 500, San Francisco, CA 94111. The
Purchaser is a wholly owned subsidiary of Parent.
Until immediately prior to the time that the Purchaser will purchase Shares
pursuant to the Offer, it is not anticipated that the Purchaser will have any
significant assets or liabilities or engage in activities other than those
incident to its formation and capitalization and the transactions contemplated
by the Offer and the Merger. Because the Purchaser is newly formed and has
minimal assets and capitalization, no meaningful financial information
regarding the Purchaser is available.
Parent is a corporation organized and existing under the laws of the State
of Delaware. Its principal offices are located at 100 California Street, Suite
500, San Francisco, CA 94111. Parent is a professional services firm that
provides a broad range of planning, design, applied science, and program and
construction management services. Parent provides these services for
infrastructure projects involving air and surface transportation systems;
institutional, industrial and commercial facilities; and pollution control,
water resources and hazardous waste management programs. Parent provides
services to local, state, and federal government agencies, as well as private
clients in the chemical, pharmaceutical, manufacturing, forest products,
energy, oil, gas, mining, health care, water supply, retail and commercial
development, telecommunications, and utilities industries.
Parent conducts business through 140 offices located throughout the world,
including the United States, Europe, and the Asia/Pacific region. Parent has
approximately 6,600 employees, many of whom hold advanced degrees and have
extensive experience in technical disciplines applicable to Parent's business.
The name, citizenship, business address, principal occupation or employment,
and five-year employment history of each of the directors and executive
officers of Parent and the Purchaser and certain other information are set
forth in Schedule I hereto.
The Parent common stock is listed and traded on the NYSE under the symbol
"URS".
Set forth below is certain selected financial data relating to Parent and
its subsidiaries for Parent's last three fiscal years, which have been
excerpted or derived from the audited financial statements contained in
Parent's Annual Report on Form 10-K for the fiscal year ended October 31, 1998
and from the unaudited financial statements contained in Parent's Quarterly
Report on Form 10-Q for the fiscal quarter ended January 31, 1999, in each
case filed by Parent with the Commission. More comprehensive financial
information is included in such reports and other documents filed by Parent
with the Commission, and the following financial data is qualified in its
entirety by reference to such reports and other documents, including the
financial information and related notes contained therein. Such reports and
other documents may be inspected and copies may be obtained from the offices
of the Commission in the same manner as set forth with respect to information
about the Company in Section 7 under "--Available Information".
13
<PAGE>
URS CORPORATION AND SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL DATA
<TABLE>
<CAPTION>
FISCAL YEARS ENDED THREE MONTHS ENDED
OCTOBER 31, JANUARY 31,
-------------------------- -------------------
1998 1997 1996 1999 1998
-------- -------- -------- --------- ---------
(UNAUDITED)
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<S> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA:
Revenues........................ $805,946 $406,451 $305,470 $ 199,057 $ 186,156
-------- -------- -------- --------- ---------
Operating expenses:
Direct operating.............. 478,640 241,002 187,129 118,878 115,231
Indirect, general and adminis-
trative...................... 277,065 141,442 102,389 68,187 61,347
-------- -------- -------- --------- ---------
Total operating expenses........ 755,705 382,444 289,518 187,065 176,578
-------- -------- -------- --------- ---------
Operating income................ 50,241 24,007 15,952 11,992 9,578
Interest expense, net........... 8,774 4,802 3,897 2,020 2,009
-------- -------- -------- --------- ---------
Income before income taxes...... 41,467 19,205 12,055 9,972 7,569
Income tax expense.............. 18,800 7,700 4,700 4,300 3,400
-------- -------- -------- --------- ---------
Net income...................... $ 22,667 $ 11,505 $ 7,355 $ 5,672 $ 4,169
======== ======== ======== ========= =========
Net income per share:
Basic......................... $ 1.51 $ 1.15 $ .92 $ .37 $ .28
======== ======== ======== ========= =========
Diluted....................... $ 1.43 $ 1.08 $ .81 $ .35 $ .27
======== ======== ======== ========= =========
Weighted average shares:
Basic......................... 14,963 10,018 8,020 15,271 14,834
Diluted....................... 15,808 10,665 9,067 16,371 15,632
</TABLE>
<TABLE>
<CAPTION>
OCTOBER 31,
-------------------------- JANUARY 31,
1998 1997 1996 1999
-------- -------- -------- -----------
<S> <C> <C> <C> <C>
BALANCE SHEET DATA:
Working capital.......................... $130,969 $ 63,236 $ 57,570 $145,160
Total assets............................. 451,704 210,091 194,932 460,799
Total debt............................... 116,016 48,049 61,263 117,214
Total stockholders' equity............... $166,360 $ 77,151 $ 56,694 $173,478
</TABLE>
Except as described in this Offer to Purchase (i) neither the Purchaser nor
Parent nor, to the best knowledge of the Purchaser or Parent, any of the
persons listed in Schedule I to this Offer to Purchase or any affiliate or
majority-owned subsidiary of the Purchaser or Parent or any of the persons so
listed beneficially owns or has any right to acquire, directly or indirectly,
any Shares and (ii) none of the Purchaser or Parent nor, to the best knowledge
of the Purchaser and Parent, any of the persons or entities referred to above,
nor any director, executive officer or subsidiary of any of the foregoing, has
effected any transaction in the Shares during the past 60 days.
Except as provided in the Merger Agreement and as otherwise described in
this Offer to Purchase, neither the Purchaser nor Parent nor, to the best
knowledge of the Purchaser and Parent, any of the persons listed in Schedule I
to this Offer to Purchase has any contract, arrangement, understanding or
relationship with any other person with respect to any securities of the
Company, including, but not limited to, any contract, arrangement,
understanding or relationship concerning the transfer or voting of such
securities, joint ventures, loan or option arrangements, puts or calls,
guaranties of loans, guaranties against loss or the giving or withholding of
proxies.
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<PAGE>
Except as set forth in this Offer to Purchase, since March 30, 1996, neither
the Purchaser nor Parent nor, to the best knowledge of the Purchaser and
Parent, any of the persons listed in Schedule I hereto, has had any business
relationship or transaction with the Company or any of its executive officers,
directors or affiliates that is 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 March 30, 1996, there have been no contacts,
negotiations or transactions between any of the Purchaser, Parent or any of
their respective subsidiaries or, to the best knowledge of the Purchaser and
Parent, any of the persons listed in Schedule I to this Offer to Purchase, on
the one hand, and the Company or its affiliates, on the other hand, concerning
a merger, consolidation or acquisition, tender offer or other acquisition of
securities, an election of directors or a sale or other transfer of a material
amount of assets.
9.FINANCING OF THE OFFER AND THE MERGER
The total amount of funds required by the Purchaser to consummate the Offer
and the Merger (including the refinancing of certain existing indebtedness of
Parent and the Company) and to pay related fees and expenses is estimated to
be approximately $775 million. The Purchaser will obtain all of such funds
from Parent. Parent currently intends to provide such funds from (i) loans
available pursuant to a credit agreement (the "Senior Bank Financing") to be
entered into by Parent, various lenders and Wells Fargo Bank, National
Association, as administrative agent ("Wells Fargo"), in an aggregate amount
of $550 million, comprised of $450 million in term loans and $100 million in a
revolving credit facility, (ii) the sale on the date on which the Offer is
consummated of senior subordinated notes in the aggregate amount of $200
million (the "Bridge Notes") to Morgan Stanley & Co. Incorporated ("Morgan
Stanley") and/or one or more of its assignees and/or certain financial
institutions (collectively, the "Note Purchasers") or, in lieu thereof,
proceeds from the Permanent Financing (as defined below) in the aggregate
amount of $200 million, and (iii) a cash equity investment in Parent on the
date on which the Offer is consummated of $100 million (the "Equity
Contribution") by RCBA Strategic Partners, L.P. ("RCBA").
The Senior Bank Financing. Parent has received a firm commitment letter
dated May 3, 1999 (the "Senior Bank Financing Commitment Letter") in which
Wells Fargo has agreed, subject to certain customary conditions, to provide
the Senior Bank Financing in an aggregate amount of up to $550 million in
order to finance the acquisition of the Company, to refinance certain existing
indebtedness of Parent and the Company, to pay related fees and expenses and
to provide for the working capital requirements of Parent and its
subsidiaries. The following is a summary of the anticipated material terms and
conditions of the Senior Bank Financing. This summary does not purport to be a
complete description of the Senior Bank Financing and is subject to the
detailed provisions of the credit agreement and various related documents to
be negotiated and entered into in connection with the Senior Bank Financing.
The Senior Bank Financing will be comprised of three tranches of term loans
and a revolving credit facility. Interest on amounts outstanding under the
credit agreement will be based upon (i) the "Base Rate" which is the higher of
(A) Wells Fargo's prime lending rate and (B) the Federal Funds Rate plus
0.50%, (ii) LIBOR (the London Interbank Offered Rate) or (iii) in the case of
certain loans made under the revolving credit facility, the rate per annum
displayed by Reuters at which Sterling is offered to Wells Fargo in the London
interbank market (the "Adjusted Domestic Sterling Rate"), plus, in each case,
an applicable margin. Parent will have the following initial pricing options:
Term Loan A-- Base Rate plus 1.75% or LIBOR plus 2.75%; Term Loan B--Base Rate
plus 2.25% or LIBOR plus 3.25%; Term Loan C--Base Rate plus 2.50% or LIBOR
plus 3.50%; Revolver--Base Rate plus 1.75%, LIBOR plus 2.75% or Adjusted
Domestic Sterling Rate plus 2.75%. Effective with the receipt of financial
statements for the fiscal quarter ending one year after the closing of the
Senior Bank Financing, the interest rate margins will be determined based on a
grid to be agreed upon by the parties. Parent has also agreed to enter into
interest rate protection agreements such that the effective interest rate on
at least 50% of the term loans is fixed for the lesser of three years or the
repayment of the term loans.
Parent has agreed to pay Wells Fargo's commitment and administrative fees,
reimburse certain expenses and provide certain indemnities, all of which
Parent believes to be customary for commitments of this type. The three
tranches of term loans will have six, seven and eight-year terms,
respectively, and the revolving credit facility will have a six-year term.
Each of the term loans will require periodic mandatory amortization payments.
15
<PAGE>
Certain of Parent's domestic subsidiaries will unconditionally guarantee the
obligations of Parent under the Senior Bank Financing. The indebtedness
incurred under the Senior Bank Financing will be secured by a first priority
lien on all existing and after-acquired personal property of Parent (including
the stock of certain subsidiaries) and all after-acquired material fee
interests in real property of Parent. A negative pledge will apply to all
other assets of Parent, subject to agreed upon exceptions. Each guarantee of a
domestic subsidiary will be secured by a first priority lien on all existing
and after-acquired personal property of such subsidiary (including the stock
of certain of its subsidiaries) and all after-acquired material fee interests
in real property of such subsidiary. A negative pledge will apply to all other
assets of such subsidiary, subject to agreed upon exceptions. From the date
upon which the Senior Bank Financing closes, until the Effective Time, the
indebtedness will be secured by a first priority, lien on the stock of the
Purchaser and, to the extent permitted by applicable law (including margin
regulations) the Shares acquired by the Purchaser in the Offer. A portion of
the proceeds of the Senior Bank Financing will be loaned by Parent to the
Company to repay existing indebtedness of the Company. Such loan shall be
evidenced by a promissory note pledged to support the obligations of Parent
under the Senior Bank Financing and will be secured by a first priority lien
on all existing and after acquired personal property of the Company and
certain of its domestic subsidiaries.
The obligation of the lenders under the Senior Bank Financing to advance
funds is subject to the satisfaction of certain conditions customary in
agreements of this type. In addition, Parent will be subject to certain
customary affirmative and negative covenants in the Senior Bank Financing,
including, without limitation, covenants that restrict, subject to specified
exceptions, (i) the incurrence of additional indebtedness and other contingent
obligations, (ii) mergers and acquisitions, (iii) asset sales, (iv) the
granting of liens, (v) prepayment or repurchase of other indebtedness, (vi)
engaging in transactions with affiliates, (vii) capital expenditures, (viii)
the making of investments and (ix) dividends and other payments with respect
to equity interests. Parent also will be subject to certain financial tests.
Wells Fargo's commitment to provide the Senior Bank Financing is conditioned
upon, among other things: (1) the preparation of definitive documentation with
respect to the Senior Bank Financing, (2) since October 31, 1998 in the case
of Parent and since December 25, 1998 in the case of the Company, there shall
have occurred no material adverse change in the business, operations,
properties, assets, liabilities, financial condition or prospects of the
respective company and its subsidiaries, taken as a whole, (3) the sum of
earnings before interest, taxes, depreciation and amortization ("EBITDA") of
Parent for the four-quarter period ending April 30, 1999, plus EBITDA of the
Company for the six-month period ending March 26, 1999 multiplied by two,
shall not be less than $143 million, (4) the Equity Contribution shall have
been made, (5) the Bridge Notes shall have been purchased (or the Permanent
Financing shall have closed), (6) the Offer shall have been consummated, (7)
all governmental approvals shall have been obtained and all applicable waiting
periods (including those under the HSR Act) shall have expired, (8)
satisfactory evidence shall have been provided of the solvency of Parent and
its subsidiaries, taken as a whole, and the Company and its subsidiaries,
taken as a whole, both before and after the closing of the Senior Bank
Financing and (9) the absence of any disruption or change in the financial,
banking or capital markets or in the regulatory environment that in the good
faith judgement of Wells Fargo could materially and adversely affect the
syndication of the Senior Bank Financing.
The Bridge Loan. Parent has received a firm commitment letter dated May 3,
1999 (the "Bridge Loan Commitment Letter") in which Morgan Stanley has agreed,
subject to certain customary conditions, to purchase or arrange for the Note
Purchasers to purchase up to $200 million of Bridge Notes in order to (along
with funds made available from the Equity Contribution and the Senior Bank
Financing) finance the acquisition of the Company, to refinance certain
existing indebtedness of Parent and the Company and to pay related fees and
expenses. The following is a summary of the anticipated material terms and
conditions of the Bridge Notes. This summary does not purport to be a complete
description of the Bridge Notes and is subject to the detailed provisions of
the note purchase agreement and various related documents to be negotiated and
entered into in connection with the Bridge Notes.
The interest rate on the Bridge Notes is the higher of (i) three-month U.S.
Dollar LIBOR plus 650 basis points and (ii) the highest yield on any of the 1-
, 3-, 5- and 10-year direct obligations issued by the United States
16
<PAGE>
plus 600 basis points. Interest is to be paid quarterly in arrears. The
interest rate on the Bridge Notes increases by 100 basis points if the Bridge
Notes are not retired within six months of the issuance date and increases by
50 basis points at the end of each three-month period thereafter to a maximum
of 17% per annum subject to a cash interest cap of 15% per annum. The Bridge
Notes mature one year from the date of issuance, are unsecured and are
subordinated in right of payment to the Senior Bank Financing. Parent will
also pay certain fees to the Note Purchasers, reimburse certain expenses and
provide certain indemnities, all of which Parent believes to be customary for
commitments of this type. The Bridge Notes are subject to mandatory redemption
(in whole or in part) upon completion of the Permanent Financing, upon a
change-of-control of Parent, upon the completion of certain asset sales by
Parent and upon the issuance of debt or equity securities by Parent.
The obligation of the Note Purchasers to purchase the Bridge Notes is
subject to the satisfaction of certain conditions customary in agreements of
this type. In addition, Parent will be subject to certain customary
affirmative and negative covenants including, without limitation, covenants
that restrict, subject to specified exceptions, (i) the incurrence of
additional indebtedness and other obligations, (ii) mergers and acquisitions,
(iii) asset sales, (iv) the granting of liens, (v) prepayment or repurchase of
other indebtedness, (vi) engaging in transactions with affiliates, (vii)
capital expenditures, (viii) the making of investments and (ix) dividends and
other payments with respect to equity interests.
The Note Purchasers' commitment to purchase the Bridge Notes is conditioned
upon, among other things: (1) the Offer having been consummated in accordance
with the terms of the Merger Agreement, (2) the Company having taken
appropriate actions to make the Company's preferred stock purchase rights
inapplicable to the Offer and the Merger, (3) the consummation of the Equity
Contribution and the closing of the Senior Bank Financing, (4) confirmation of
the solvency of Parent and its subsidiaries, taken as a whole, immediately
before and after giving effect to the acquisition of the Company, (5) the
satisfactory completion of definitive documentation relating to the Bridge
Notes, (6) receipt of all governmental and third party consents necessary to
consummate the Offer and the issuance of the Bridge Notes and the expiry or
termination of all applicable waiting periods (including those required by the
HSR Act), (7) the absence of any material adverse change, as determined by the
Note Purchasers in their reasonable judgment, in the business, financial
condition, operations, performance, properties or prospects of Parent and its
subsidiaries, taken as a whole, since the end of Parent's most recent fiscal
year, or of the Company and its subsidiaries, taken as a whole, since the end
of the Company's third fiscal quarter; no additional facts or information
shall have come to the attention of the Note Purchasers that is inconsistent
with the information disclosed to them prior to May 3, 1999 that could
reasonably be expected to have a material adverse effect on (a) the business,
financial condition, operations, performance, properties or prospects of (i)
Parent and its subsidiaries, taken as a whole, or (ii) the Company and its
subsidiaries, taken as a whole, (b) the refinancing of the Bridge Notes or (c)
the rights or remedies of the Note Purchasers or the ability of Parent to
perform its obligations to the Note Purchasers (collectively, a "Bridge Note
Material Adverse Effect"), (8) no action, suit, investigation, litigation or
proceeding pending or threatened in any court or before any arbitrator or
governmental or regulatory agency or authority that could reasonably be
expected to have a Bridge Note Material Adverse Effect and (9) the absence of
any disruption or change in financial, banking or capital markets or in the
regulatory environment that in the good faith judgement of the Note Purchasers
could materially and adversely affect the sale of the Bridge Notes or the
refinancing thereof.
The Equity Contribution. Parent has entered into a securities purchase
agreement, dated as of May 5, 1999 (the "RCBA Commitment"), by and between
RCBA and Parent in which RCBA has agreed to make an equity investment in
Parent in the amount of $100 million as of the consummation of the Offer. This
commitment is subject to customary conditions including, without limitation,
(1) the absence of a condition, event or development having, or likely to
have, a material adverse effect on the business, operations, properties,
assets, liabilities, financial condition, or prospects of Parent and its
subsidiaries, taken as a whole, (2) no suspension or limit of trading in
securities generally on the NYSE, (3) Company EBITDA for the fiscal year ended
March 26, 1999, before second quarter restructuring charges shall be no less
than $65 million, (4) the waiting period under the HSR Act pertaining to the
Equity Contribution shall have expired or been terminated, (5) the exemption
of the Equity Contribution and related transactions from Section 203 of the
DGCL, (6) the execution of the
17
<PAGE>
definitive documentation in regard to the Senior Bank Financing, (7) the
concurrent issuance and sale of the Bridge Notes (or the closing of the
Permanent Financing in lieu thereof) and (8) the concurrent consummation of
the Offer.
The Offer is subject to the satisfaction or waiver of the conditions to the
financing commitments described above. See Section 14.
It is anticipated that as promptly as reasonably practicable after the
consummation of the Offer and the Merger, Parent will issue in a non-public
offering approximately $200 million in long-term, fixed rate, unsecured,
subordinated debt securities (the "Permanent Financing"), the cash proceeds of
which will be used to redeem the Bridge Notes (or, if such Permanent Financing
is arranged prior to the consummation of the Offer, which will be used in
place of the sale of the Bridge Notes). It is anticipated that the
indebtedness incurred through borrowing under the Senior Bank Financing and
through the issuance of the Permanent Financing (and until replaced with the
Permanent Financing, the indebtedness under the Bridge Notes) will be repaid
from funds generated internally by Parent and its subsidiaries, including the
Company and its subsidiaries, and from other sources that may include the
proceeds of the private or public sale of debt or equity securities. No final
decisions have been made concerning the method Parent will employ to repay
such indebtedness. Such decisions when made will be based upon Parent's review
from time to time of the advisability of particular actions, as well as on
prevailing interest rates and financial and other economic conditions.
10. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY; THE MERGER AGREEMENT
On April 8, 1999, Martin M. Koffel, Chairman and Chief Executive Officer of
Parent, contacted Arthur C. Darrow, Chairman, Chief Executive Officer and
President of the Company, and requested a meeting.
Messrs. Koffel and Darrow met on April 12 in Santa Barbara, California. At
this meeting, Mr. Koffel presented Mr. Darrow with a letter containing an
offer, approved by the Board of Directors of Parent (the "Parent Board"), to
acquire all outstanding common stock of the Company for a price of $16.00 per
share in cash. The purchase offer was subject to customary due diligence,
approval of the Board of Directors of the Company (the "Company Board"),
execution of a definitive agreement, certain standard regulatory filings, and
stockholder approvals. The offer letter stated that financial partners working
with Parent to analyze the potential transaction had confirmed that debt and
equity financing would be made available to Parent to finance the purchase
price and refinance the credit facilities of the combined enterprise. The
offer letter requested that the Company respond as soon as possible, and in
any event, no later than the close of business on April 14, 1999. Mr. Koffel
told Mr. Darrow that Parent wished to proceed quickly with negotiations with
the Company on an exclusive basis. Mr. Koffel told Mr. Darrow that Parent's
offer was a full price offer that was intended to be preemptive, and that the
offer price was not subject to negotiation. Mr. Darrow indicated to Mr. Koffel
that Parent's offer appeared to present a very attractive strategic
alternative to the Company and its stockholders, and that he would present it
to the Company Board promptly.
On April 14, Parent and the Company negotiated and entered into a
confidentiality agreement with Parent, which provided for an exclusive
negotiating period with Parent until May 7, 1999 (subject to extension until
May 31 in the event that the parties were continuing to negotiate). The
confidentiality agreement also contained a one-year standstill agreement by
Parent.
On April 16, 1999, representatives of Parent, Parent's legal counsel and the
Parent's financial advisor, Morgan Stanley, held an organizational meeting in
Los Angeles, California with representatives of the Company and its legal
counsel. At this meeting, the parties discussed several proposed alternative
transaction structures, including a merger, or a tender offer followed by a
merger. The Company expressed a strong preference for a structure that would
include a cash tender offer because it would expedite the delivery of cash to
the stockholders of the Company and the expedited closing would be less
disruptive to the Company's employees. Parent indicated that it was seriously
considering the feasibility of the tender offer structure. The parties also
discussed the proposed financing for the transaction, including both debt and
equity financing. The Company indicated that,
18
<PAGE>
in connection with the execution of any definitive agreement, Parent must
provide the Company with firm financing commitments in a form acceptable to
the Company. In addition, at this meeting, representatives of Parent and its
advisors commenced legal and business due diligence on the Company.
On April 19, the parties met in San Francisco, California. At this meeting,
certain members of senior management of the Company and the managers of each
of the Company's key operating divisions made presentations to representatives
of Parent and its financial advisors, legal counsel, bank lenders, and RCBA.
On April 20, counsel for Parent delivered to counsel for the Company a
proposed draft of a merger agreement, which proposed a cash tender offer
followed by a cash merger.
From April 21 through April 23, representatives of Parent and Parent's
financial advisors met in Los Angeles with representatives of the Company.
During this period, the Company continued to provide Parent with financial and
legal due diligence regarding the Company.
On April 24, counsel for the Company delivered to counsel for Parent
comments on the proposed draft of the merger agreement. Comments on the draft
merger agreement included, among other things, a prohibition on the Purchaser
waiving the Minimum Condition, and revisions to the termination provisions,
conditions to the Offer, the non-solicitation covenant, and fees and expenses
payable upon termination. On April 27, counsel for Parent and counsel for the
Company held a telephone call during which they negotiated and resolved a
number of the comments on the draft merger agreement that had been raised by
the Company and its counsel.
On April 28, representatives of Parent and the Company met in Austin, Texas.
During this meeting, the Parent's representatives toured the facilities of
Radian International LLC ("Radian"), a recent acquisition by the Company, and
met with certain senior officers of Radian.
From April 29 to 30, representatives of RCBA, Wells Fargo, and Arthur
Andersen & Co., RCBA's accountants, met with representatives of the Company in
Los Angeles, continuing the financial, operational and legal due diligence.
On April 30, representatives of Parent and the Company and their respective
legal counsel held a telephonic conference call, at which substantially all
remaining outstanding issues in the merger agreement were discussed and
resolved. That evening, Parent provided the Company and its counsel with
drafts of the agreement for the Equity Contribution and the commitment letters
relating to the sale of the Bridge Notes and the Senior Bank Financing. On May
1 and 2, the Company and its counsel provided Parent with comments on such
agreement and commitment letters, which then were finalized and executed by
the financing sources on May 3.
On May 3 and again on May 5, members of the Parent Board met to consider the
final terms of the proposed transaction and its financing. The members of the
Parent Board discussed the valuation and structure of the proposed transaction
and its financing, and the strategic and other benefits and risks which the
transaction and financing presented. Representatives of Morgan Stanley made a
presentation and orally expressed to the Parent Board Morgan Stanley's opinion
(subsequently confirmed in writing) that the consideration to be paid by
Parent pursuant to the Merger Agreement was fair from a financial point of
view to Parent.
On May 3, an authorized officer of Parent and the Purchaser executed and
delivered to the Company the Merger Agreement to be held in escrow pending
consideration of the proposed transaction by the Company Board. On May 5, the
Parent Board formally confirmed and ratified its earlier determination that
the transaction and the related financing was in the best interests of the
stockholders of Parent and (i) approved the Offer and the Merger, (ii)
approved the Merger Agreement and declared its advisability, and (iii)
approved and declared advisable the Equity Contribution, the commitment
letters relating to the sale of the Bridge Notes and the Senior Bank Financing
and all related transactions.
Parent has been advised by the Company that on May 5, the Company Board held
a special meeting to consider the final terms of the Offer, the Merger, and
the Merger Agreement and that at such meeting the Board
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unanimously (i) approved the Offer and the Merger, (ii) approved the Merger
Agreement and declared its advisability and (iii) determined to recommend that
the Company's stockholders accept the Offer, tender their Shares pursuant to
the Offer, and, if required, approve the Merger.
Following the meeting of the Company Board, an authorized officer of the
Company executed the Merger Agreement and delivered it to Parent. The Offer
and the Merger were publicly announced after U.S. financial markets closed on
May 5, 1999.
On May 11, 1999, Parent and the Purchaser commenced the Offer.
THE MERGER AGREEMENT
The following is a summary of the Merger Agreement, a copy of which is
incorporated by reference as an exhibit to the Tender Offer Statement on
Schedule 14D-1 (the "Schedule 14D-1") filed by the Purchaser and Parent with
the Commission in connection with the Offer. Such summary is qualified in its
entirety by reference to the Merger Agreement.
The Offer. The Merger Agreement provides for the commencement of the Offer
as promptly as practicable, but in no event later than five business days
after the initial public announcement of the execution of the Merger
Agreement. The Purchaser has commenced the Offer in accordance with the terms
of the Merger Agreement.
The Merger Agreement provides that the obligation of the Purchaser to, and
of Parent to cause the Purchaser to, consummate the Offer and accept for
payment, and pay for, any Shares tendered and not withdrawn pursuant to the
Offer is subject only to the conditions set forth in Section 14 (the "Offer
Conditions") (any of which may be waived in whole or in part by the Purchaser
in its sole discretion, provided, however, that the Purchaser shall not waive
the Minimum Condition without the prior written consent of the Company). The
Purchaser expressly reserved in the Merger Agreement the right, subject to
compliance with the Exchange Act, to modify the terms of the Offer, except
that, without the express written consent of the Company, neither Parent nor
the Purchaser shall (i) reduce the number of Shares subject to the Offer, (ii)
reduce the Offer Price, (iii) add to or modify the Offer Conditions, (iv)
except as provided in the next paragraph, change the expiration date of the
Offer, (v) change the form of consideration payable in the Offer or (vi)
amend, alter, add or waive any term of the Offer in any manner adverse to the
holders of the Shares.
Notwithstanding the foregoing, if on any scheduled expiration date of the
Offer, all Offer Conditions have not been satisfied or waived, the Merger
Agreement provides that the Purchaser may, and at the request of the Company
shall, from time to time, extend the expiration date of the Offer for up to
ten additional business days, and the Purchaser may, without the consent of
Company, (A) extend the Offer for any period required by any rule, regulation,
interpretation or position of the Commission or the Commission staff
applicable to the Offer and (B) extend the Offer for up to ten business days
if there have been validly tendered and not withdrawn prior to the expiration
of the Offer such number of Shares that would constitute at least 75% but less
than 90% of the issued and outstanding Shares as of the date of determination.
The Merger Agreement provides that subject only to the conditions set forth in
Section 14, the Purchaser shall, and Parent shall cause the Purchaser to, as
soon as practicable after the expiration of the Offer, accept for payment, and
pay for, all Shares validly tendered and not withdrawn that the Purchaser
becomes obligated to accept for payment pursuant to the Offer.
Directors. The Merger Agreement provides that promptly upon the acceptance
for payment of, and payment for, not less than a majority of the outstanding
Shares pursuant to the Offer, the Purchaser shall be entitled to designate
such number of directors on the Board as will give the Purchaser, subject to
compliance with Section 14(f) of the Exchange Act, a majority of such
directors, and the Company shall, at such time, cause the Purchaser's
designees to be so elected by the existing Board; provided, however, that in
the event that the Purchaser's designees are elected to the Board, until the
Effective Time (as defined in "--The Merger") such Board shall have at least
three directors who were directors of the Company on the date of the Merger
Agreement
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(the "Continuing Directors") and; provided further that, in such event, if the
number of Continuing Directors shall be reduced below three for any reason
whatsoever, the remaining Continuing Director(s) shall designate a person to
fill such vacancy who shall be deemed to be a Continuing Director for purposes
of the Merger Agreement or, if no Continuing Directors then remain, the other
directors of the Company on the date of the Merger Agreement shall designate
three persons to fill such vacancies who shall not be officers or affiliates
of the Company or any of its subsidiaries, or officers or affiliates of Parent
or any of its subsidiaries, and such persons shall be deemed to be Continuing
Directors for purposes of the Merger Agreement. The Merger Agreement provides
that subject to applicable law, the Company shall take all action requested by
Parent necessary to effect any such election, including mailing to its
stockholders the Information Statement containing the information required by
Section 14(f) of the Exchange Act and Rule 14f-1 promulgated thereunder, and
the Company agreed to make such mailing with the mailing of the Schedule 14D-9
(provided that the Purchaser provides to the Company on a timely basis in
writing all information required to be included in the Information Statement
with respect to the Purchaser's designees). In connection with the foregoing,
the Company agreed in the Merger Agreement to promptly, at the option of
Parent, either increase the size of the Board or use its best efforts to
obtain the resignation of such number of its current directors as is necessary
to enable the Purchaser's designees to be elected or appointed to, and to
constitute a majority of, the Board.
The Merger. The Merger Agreement provides that upon the terms and subject to
the conditions set forth in such agreement, and in accordance with the DGCL,
the Purchaser shall be merged with and into the Company at the Effective Time.
Following the Effective Time, the separate corporate existence of the
Purchaser shall cease and the Company shall continue as the surviving
corporation (the "Surviving Corporation") and shall succeed to and assume all
the rights and obligations of the Purchaser in accordance with the DGCL.
Subject to the provisions of the Merger Agreement, as soon as practicable on
or after the satisfaction or waiver of the conditions set forth in "--
Conditions to the Merger" (the "Merger Conditions"), the parties shall file
(i) a certificate of merger (the "Certificate of Merger") with the Secretary
of State of the State of Delaware, or (ii) in the event the Purchaser shall
have acquired 90% or more of the outstanding shares of each class of capital
stock of Company, file a certificate of ownership and merger (the "Certificate
of Ownership") with the Secretary of State of the State of Delaware, in each
case in such form as required by and executed in accordance with the relevant
provisions of the DGCL and shall make all other filings or recordings required
under the DGCL and other applicable law. The Merger shall become effective at
such time as the Certificate of Merger or the Certificate of Ownership, as
applicable, is duly filed with the Secretary of State of the State of
Delaware, or at such other time specified in the Certificate of Merger or the
Certificate of Ownership as the Purchaser and the Company shall agree (the
time the Merger becomes effective being hereinafter referred to as the
"Effective Time").
The Merger Agreement provides that the directors of the Purchaser
immediately prior to the Effective Time will be the initial directors of the
Surviving Corporation and that the officers of both the Purchaser and the
Company immediately prior to the Effective Time will be the initial officers
of the Surviving Corporation. The Merger Agreement also provides that the
certificate of incorporation of the Purchaser as in effect immediately prior
to the Effective Time, and as amended to change the name to "Dames & Moore
Group", shall be the certificate of incorporation of the Surviving
Corporation, and further provides that the By-laws of the Purchaser as in
effect immediately prior to the Effective Time will be the By-laws of the
Surviving Corporation.
Conversion Of Securities. The Merger Agreement provides that as of the
Effective Time, by virtue of the Merger and without any action on the part of
the holder of any Shares or any shares of capital stock of the Purchaser:
(i) Each issued and outstanding share of capital stock of the Purchaser
shall be converted into and become one fully paid and nonassessable
share of common stock, par value $.01 per share, of the Surviving
Corporation;
(ii) Each Share that is owned by the Company and each Share that is owned
by Parent or the Purchaser shall automatically be canceled and retired
and shall cease to exist, and no consideration shall be delivered in
exchange therefor. Each Share that is owned by any direct or indirect
wholly-owned subsidiary of Parent (other than the Purchaser) or of the
Company shall remain outstanding without change; and
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(iii) Subject to the rights of stockholders ("Dissenting Stockholders") who
properly exercise their right of appraisal under the DGCL in regard
to their Shares ("Dissenting Shares"), each issued and outstanding
Share (other than Shares to be canceled or to remain outstanding in
accordance with clause (ii) above, and other than Dissenting Shares)
shall be converted into the right to receive from the Surviving
Corporation in cash, without interest, $16.00 per Share (the "Merger
Consideration"). The Merger Agreement provides that as of the
Effective Time, all such Shares shall no longer be outstanding and
shall automatically be canceled and retired and shall cease to exist,
and each holder of a certificate representing any such Shares shall
cease to have any rights with respect thereto, except the right to
receive the Merger Consideration, without interest.
Stock Options. The Merger Agreement provides that as soon as practicable
following the date of the Merger Agreement but in no event later than the
consummation of the Offer, the Company (or, if appropriate, the Board or any
committee administering the Stock Option Plans (as defined below)) shall take
actions (which, in the case of the Company's 1995 Stock Option Plan for Non-
Employee Directors, shall be to make reasonable efforts to obtain the consent
of the option holders thereunder to permit actions) such that (including by
adopting resolutions or taking any other actions) each outstanding option to
purchase Shares (a "Company Stock Option") heretofore granted under any stock
option, stock appreciation rights or stock purchase plan, program or
arrangement of the Company (collectively, the "Stock Option Plans") that is
outstanding immediately prior to the consummation of the Offer, whether or not
then exercisable, shall be canceled immediately prior to the Effective Time in
exchange for an amount in cash, payable at the time of such cancellation,
equal to the product of (i) the number of Shares subject to such Company Stock
Option immediately prior to the Effective Time and (ii) the excess, if any, of
the Offer Price over the per Share exercise price of such Company Stock
Option. The Merger Agreement provides that the Company (or, if appropriate,
the Board or any committee administering the Stock Option Plans) shall take
actions such that immediately prior to the Effective Time the outstanding
Company Stock Options are canceled as set forth above. The Merger Agreement
provides that the Company shall not make, or agree to make, any payment of any
kind to any holder of a Company Stock Option (except for the payment described
above) without the consent of Parent.
Subject to the prior paragraph, the Merger Agreement requires that all Stock
Option Plans shall terminate as of the Effective Time and the provisions in
any other Company benefit plan providing for the issuance, transfer or grant
of any capital stock of Company or any interest in respect of any capital
stock of Company shall be deleted as of the Effective Time. The Company agreed
in the Merger Agreement to use its reasonable best efforts to ensure that
following the Effective Time, no holder of a Company Stock Option or any
participant in any Stock Option Plan shall have any right thereunder to
acquire any capital stock of the Company, Parent or the Surviving Corporation.
The Company agreed in the Merger Agreement to take all actions necessary to
provide for the cancellation of all outstanding grants of Shares that are
subject to a vesting requirement (the "Company Restricted Stock") immediately
prior to the Effective Time in exchange for a per share cash payment equal to
the Merger Consideration; provided that the Company shall have the right to
waive any such vesting requirement and accelerate the vesting of any shares of
Company Restricted Stock.
Representations and Warranties. The Merger Agreement contains various
customary representations and warranties of the parties thereto, including the
following representations by the Company: organization and authority,
subsidiaries, capital structure, authorization, no conflicts, consents,
Commission filings, financial statements, supplied information, absence of
certain changes or events, compliance with laws, litigation, taxes, absence of
changes in benefit plans, ERISA compliance, excess parachute payments,
insurance, environmental matters, contracts, real and leased real property,
intellectual property, stockholder votes, approvals, brokers, opinion of
financial advisor, Year 2000 compliance, the Company rights agreement and
certain business practices; and the following representation and warranties of
Parent and the Purchaser: organization, authority, consents, approvals, no
violations, information supplied, interim operations of the Purchaser,
brokers, financing and solvency. The representations and warranties of the
Company do not survive the consummation of the Offer.
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Conduct of Business. Under the Merger Agreement, the Company has covenanted
and agreed that, during the period from May 5, 1999 to the Effective Time or
termination of the Merger Agreement, except as otherwise contemplated by the
Merger Agreement or to the extent that Parent shall otherwise consent in
writing, the Company shall, and shall cause each of its subsidiaries to, carry
on its business in all material respects in the ordinary course consistent
with past practice and, to the extent consistent therewith, use reasonable
efforts to preserve, in all material respects, intact its business
organization, keep available the services of its officers and employees, in
all material respects, and preserve its relationships with customers,
suppliers, licensors, licensees, distributors and others having significant
business dealings with it. The Merger Agreement provides that without limiting
the generality of the foregoing, during the period from May 5, 1999 to the
Effective Time, the Company shall not, and shall not permit any of its
subsidiaries to (except as expressly permitted by the Merger Agreement or as
set forth in certain schedules thereto or to the extent that Parent shall
otherwise consent in writing):
(i) (A) declare, set aside or pay any dividends on, or make any other
distributions in respect of, any of its capital stock, other than (1)
dividends and distributions by a direct or indirect wholly-owned
subsidiary of the Company to its parent, (2) contractually required
distributions to partners in joint ventures, and (3) earn-out payments
in connection with acquisitions consummated prior to May 5, 1999 as set
forth in certain disclosure schedules to the Merger Agreement, (B)
split, combine or reclassify any of its capital stock or issue or
authorize the issuance of any other securities in respect of, in lieu
of or in substitution for shares of its capital stock, or (C) purchase,
redeem or otherwise acquire any shares of its capital stock or any
other securities thereof or any rights, warrants or options to acquire
any such shares or other securities;
(ii) issue, deliver, sell, pledge or otherwise encumber any shares of its
capital stock, any other voting securities or any securities
convertible into, or any rights, warrants or options to acquire, any
such shares, voting securities or convertible securities (other than
the issuance of Shares upon the exercise of Company Stock Options
outstanding on May 5, 1999 in accordance with their then present
terms);
(iii) amend the certificate of incorporation of the Company or its By-laws
or other comparable charter or organizational documents;
(iv) acquire or agree to acquire (A) by merging or consolidating with, or
by purchasing a substantial portion of the assets or any stock of, or
by any other manner, any business or any corporation, partnership,
joint venture, association or other business organization or division
thereof or (B) except as set forth on certain disclosure schedules of
the Merger Agreement, any assets that are material, individually or in
the aggregate, to the Company, except purchases of supplies and
inventory in the ordinary course of business consistent with past
practice;
(v) sell, lease, license, mortgage or otherwise encumber or subject to any
lien or otherwise dispose of any of its properties or assets, except
sales of inventory or sales or licenses of immaterial assets, in each
case in the ordinary course of business consistent with past practice
and except for sales of assets for consideration that does not exceed,
individually or in the aggregate, $1,000,000;
(vi) (A) incur or suffer to exist any new indebtedness for borrowed money
or guarantee any such indebtedness of another person, issue or sell
any debt securities or warrants or other rights to acquire any debt
securities of the Company or any of its subsidiaries, guarantee any
debt securities of another person, enter into any "keep well" or other
agreement to maintain any financial statement condition of another
person or enter into any arrangement having the economic effect of any
of the foregoing, except for short-term borrowings incurred in the
ordinary course of business consistent with past practice, or (B) make
any loans, advances (other than to employees of the Company in the
ordinary course of business) or capital contributions to, or
investments in, any other person, except as permitted by certain
schedules to the Merger Agreement;
(vii) except as set forth on certain disclosure schedules to the Merger
Agreement, make or agree to make any capital expenditure or
expenditures with respect to property, plant or equipment except in
the ordinary course of business and except for any capital
expenditure that, individually, is in excess of
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$200,000 or, in the aggregate for the Company and such subsidiaries
with respect to all capital expenditures after May 5, 1999, are in
excess of $1,500,000;
(viii) make any material tax election or settle or compromise any material
income tax liability or make any change in accounting methods,
principles or practices;
(ix) pay, discharge, settle or satisfy any material claims, liabilities or
obligations (absolute, accrued, asserted or unasserted, contingent or
otherwise), (other than the payment, discharge or satisfaction, in the
ordinary course of business consistent with past practice or in
accordance with their terms, of liabilities reflected or reserved
against in, or contemplated by, the most recent consolidated financial
statements (or the notes thereto) of the Company included in the
periodic filings with the Commission required under the Exchange Act
or incurred thereafter in the ordinary course of business consistent
with past practice and other than settlements or compromises of
claims, liabilities or obligations not involving any obligation of the
Company other than the payment of money where the amount paid or to be
paid in settlement or compromise does not exceed $500,000, provided
that the aggregate amount paid in connection with the settlement or
compromise of all such matters shall not exceed $1,000,000), or waive
any material benefits of, or agree to modify in any material respect,
any confidentiality, standstill or similar agreements to which the
Company or any of its subsidiaries is a party;
(x) except in the ordinary course of business, modify, amend or terminate
any material contract or agreement to which the Company or any of its
subsidiaries is a party, or waive, release or assign any material
rights or claims;
(xi) enter into any material contracts or agreements relating to the
distribution, sale or marketing by third parties of the services or
products of, or the services or products licensed by, the Company or
any of its subsidiaries;
(xii) except as required to comply with applicable law or agreements, plans
or arrangements existing on May 5, 1999 or as set forth in certain
schedules to the Merger Agreement, (A) adopt, enter into, terminate
or amend any employment agreement or Company benefit plan or other
arrangement for the benefit or welfare of any director, officer or
current or former employee, (B) increase in any manner the
compensation or fringe benefits of, or pay any bonus to, any
director, officer or key employee except with respect to new hires
and promotions, in the ordinary course of business, consistent with
past practice, (C) pay any benefit not provided for under any Company
benefit plan, (D) grant any awards under any bonus, incentive,
performance or other compensation plan or arrangement or Company
benefit plan (including the grant of stock options, stock
appreciation rights, stock based or stock related awards, performance
units or restricted stock, or the removal of existing restrictions in
any Company benefit plans or agreement or awards made thereunder), or
(E) take any action other than in the ordinary course of business to
fund or in any other way secure the payment of compensation or
benefits under any employee plan, agreement, contract or arrangement
or Company benefit plan;
(xiii) obligate itself to pay fees and expenses for the services of
Prudential Securities in regard to its services to the Company in
connection with the transactions contemplated in the Merger
Agreement in excess of the amounts set forth in certain disclosure
schedules to the Merger Agreement; or
(xiv) authorize any of, or commit or agree to take any of, the foregoing
actions.
Prospectus/Proxy Statement; Registration Statement; Stockholders
Meetings. (a) The Merger Agreement provides that if the Company is required to
obtain approval from its stockholders of the Merger under applicable law
("Company Stockholder Approval"), the Company will, as soon as practicable
following the acceptance for payment of, and payment for, Shares by the
Purchaser pursuant to and subject to the Offer Conditions, duly call, give
notice of, convene and hold a meeting of its stockholders (the "Stockholders
Meeting") for the purpose of obtaining Company Stockholder Approval. The
Company agreed in the Merger Agreement that it will, through its Board,
recommend to its stockholders that Company Stockholder Approval be given. The
Merger Agreement provides that notwithstanding the foregoing, if the Purchaser
or any other subsidiary of Parent shall acquire at
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least 90% of the outstanding Shares, the parties shall, at the request of
Parent, take all necessary and appropriate action to cause the Merger to
become effective as soon as practicable after the expiration of the Offer
without a stockholders meeting in accordance with Section 253 of the DGCL.
(b) The Merger Agreement provides that if Company Stockholder Approval is
required by law, the Company will, at Parent's request, as soon as practicable
following the expiration of the Offer, prepare and file a preliminary Proxy
Statement with the Commission and will use its best efforts to respond to any
comments of the Commission or its staff and to cause the Proxy Statement to be
mailed to the Company's stockholders as promptly as practicable after
responding to all such comments to the satisfaction of the staff. The Company
has agreed in the Merger Agreement that it will notify Parent promptly of the
receipt of any comments from the Commission or its staff and of any request by
the Commission or its staff for amendments or supplements to the Proxy
Statement or for additional information and will supply Parent with copies of
all correspondence between the Company or any of its representatives, on the
one hand, and the Commission or its staff, on the other hand, with respect to
the Proxy Statement or the Merger. If at any time prior to the Stockholders
Meeting there shall occur any event that should be set forth in an amendment
or supplement to the Proxy Statement, the Company will promptly prepare and
mail to its stockholders and file with the Commission such an amendment or
supplement.
(c) Parent has agreed in the Merger Agreement to cause all Shares purchased
pursuant to the Offer and all other Shares owned by Parent or any subsidiary
of Parent to be voted in favor of Company Stockholder Approval.
No Solicitation. (a) The Merger Agreement provides that the Company shall
not, and shall not authorize or permit any of its subsidiaries or any of its
or their officers, directors or employees to, and shall use its reasonable
efforts to cause any investment banker, financial advisor, attorney,
accountant or other representative of the Company or of any of its
subsidiaries not to, directly or indirectly, (i) solicit, initiate or
encourage (including by way of furnishing information), or take any other
action to facilitate (including any action intended to neutralize the rights
plan of the Company with respect to), any inquiries or the making of any
proposal that constitutes, or may reasonably be expected to lead to, any
Takeover Proposal (as defined below) or (ii) participate in any discussions or
negotiations regarding any Takeover Proposal; provided, however, that prior to
the acceptance for payment of the Minimum Shares (as defined in Section 14)
pursuant to the Offer, the Company may, if it is determined in good faith by
the Board after consultation with its legal and financial advisors, in
response to a Takeover Proposal from any person that was not solicited by the
Company and did not otherwise result from a breach of the obligations
described in this paragraph, that such Takeover Proposal is likely to result
in the acquisition of more than 50% of the outstanding Shares or of the assets
of the Company and its subsidiaries, taken as a whole and provide greater
value to the Company's stockholders than the transactions provided for in the
Merger Agreement (a "Superior Proposal"), (x) furnish information with respect
to the Company to such person pursuant to a customary confidentiality
agreement, and (y) participate in discussions or negotiations with such person
regarding any Takeover Proposal.
For purposes of the Merger Agreement, "Takeover Proposal" means any proposal
or offer from any person relating to any direct or indirect acquisition or
purchase of 20% or more of the assets of the Company and its subsidiaries,
taken as a whole, or 20% or more of any class of outstanding equity securities
of the Company or any of its subsidiaries, any tender offer or exchange offer
that if consummated would result in any person beneficially owning 20% or more
of any class of equity securities of the Company or any of its subsidiaries or
any merger, consolidation, business combination, sale of substantially all the
assets, recapitalization, liquidation, dissolution or similar transaction
involving the Company or any of its subsidiaries, other than the transactions
contemplated by the Merger Agreement.
(b) The Merger Agreement provides that neither the Board nor any committee
thereof shall (i) withdraw or modify, in a manner adverse to Parent, the
approval or recommendation by such Board or such committee of the Offer, of
the Merger Agreement or the Merger, (ii) approve or recommend any Takeover
Proposal or (iii) cause the Company to enter into any letter of intent,
agreement in principle, acquisition agreement or other agreement (an
"Acquisition Agreement") with respect to any Takeover Proposal (other than a
confidentiality
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agreement referred to in paragraph (a) above); provided, however, that prior
to the acceptance for payment of the Minimum Shares pursuant to the Offer, the
Board is permitted to terminate the Merger Agreement if the Board determines
in good faith (based on the advice of the Company's financial advisor that a
Takeover Proposal was a Superior Proposal and the advice of the Company's
counsel) that failure to terminate the Merger Agreement would constitute a
breach of the Board's fiduciary duties under applicable law (provided that
substantially concurrently with such termination the Company enters into a
definitive agreement containing the terms of the Superior Proposal, and
provided further that any termination pursuant to this paragraph shall not be
effective unless the Company shall have fully complied with the provision set
forth in "--Fees and Expenses").
(c) In addition to the obligations of the Company set forth in paragraphs
(a) and (b) above, the Merger Agreement provides that the Company shall
immediately (and in any event within 24 hours) advise Parent orally and in
writing of any Takeover Proposal, any request for information concerning the
Company or its subsidiaries in relation to or any inquiry regarding the making
of a Takeover Proposal, the material terms and conditions of such Takeover
Proposal, request for information or inquiry and the identity of the person
making such Takeover Proposal, request for information or inquiry. The Company
agreed in the Merger Agreement that it will keep Parent fully informed of the
status and details (including amendments or proposed amendments) of any such
Takeover Proposal, request for information or inquiry.
The Merger Agreement provides that nothing contained in "--No Solicitation"
shall prohibit the Company from taking or disclosing to its stockholders a
position contemplated by Rule 14e-2(a) promulgated under the Exchange Act if,
in the good faith judgment of the Board, after consultation with outside
counsel, such actions are required under applicable law.
Solvency Matters. The Merger Agreement provides that Parent and the Company
will jointly agree to retain a mutually satisfactory appraisal firm (the
"Appraiser") to provide a letter to the Board and the Board of Directors of
the Parent (the "Solvency Letter") to the effect that the financing to be
provided to Parent to effect the Offer and the Merger and the other
transactions contemplated in the Merger Agreement (See Section 9) will not
cause (i) the fair salable value of the Surviving Corporation's assets to be
less than the total amount of its existing liabilities, (ii) the fair salable
value of the assets of the Surviving Corporation to be less than the amount
that will be required to pay its probable liabilities on its existing debts as
they mature, (iii) the Surviving Corporation not to be able to pay its
existing debts as they mature or (iv) the Surviving Corporation to have an
unreasonably small capital with which to engage in its business.
The Merger Agreement further provides that the Appraiser will be requested
to deliver a Solvency Letter as promptly as practicable. If the Appraiser is
unable to deliver the Solvency Letter or the Solvency Letter is not reasonably
acceptable to the Board, Parent and the Purchaser covenanted and agreed in the
Merger Agreement that, notwithstanding anything to the contrary in the Merger
Agreement, the Purchaser will not accept for payment, or pay for, Shares
pursuant to the Offer.
Company Benefit Plans. Until October 31, 1999, Parent shall cause the
Surviving Corporation to continue to provide to employees of the Company and
its subsidiaries (excluding employees covered by collective bargaining
agreements), as a whole, Employee Benefits (as defined below) which, in the
aggregate, are not materially less favorable to such employees than the
Employee Benefits provided to such employees as of the date of the Merger
Agreement. For all Employee Benefits (including, without limitation, Employee
Plans (as defined below) and other programs of Parent and its affiliates after
the Effective Time), Parent will, to the extent permitted under the relevant
Employee Plan, cause all service with the Company or any of its subsidiaries
prior to the Effective Time of employees (excluding employees covered by
collective bargaining agreements) to be treated as service with Parent and its
affiliates for eligibility, vesting and benefit accrual purposes to the same
extent that such service is taken into account by the Company and its
subsidiaries as of the date of the Merger Agreement, except to the extent such
treatment will result in duplication of benefits. From and after the Effective
Time, Parent shall, to the extent permitted under the relevant Employee Plan,
(i) cause any pre-existing condition or limitation and any eligibility waiting
periods (to the extent such limitations or waiting periods did not apply to
the employees of the Company under the Employee Plans in existence as of the
date of the Merger Agreement)
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under any group health plans of Parent or any of its subsidiaries to be waived
with respect to employees of the Company and their eligible dependents and
(ii) give each employee of the Company credit for the plan year in which the
Effective Time occurs toward applicable deductions and annual out-of-pocket
limits for expenses incurred prior to the Effective Time (or such later date
on which participation commences) during the applicable plan year. "Employee
Benefits" shall mean benefits provided under any of the following "Employee
Plans": medical, health, dental, life insurance, long-term disability,
severance, pension, retirement or savings plan, policy or arrangement,
including those such plans for which coverage is generally limited to officers
or a select group of highly compensated employees of the Company or any of its
subsidiaries. Nothing herein shall require the continued employment of any
person or prevent the Company and/or the Surviving Corporation from taking any
action or refraining from taking any action which the Company could take or
refrain from taking prior to or after the Effective Time, including, without
limitation, any action the Company or the Surviving Corporation could take to
terminate, or change or reduce the benefits available under, any plan under
its terms as in effect as of the date of the Merger Agreement.
Indemnification. (a) In the Merger Agreement, Parent agreed that all rights
to indemnification and exculpation (including the advancement of expenses)
from liabilities for acts or omissions occurring at or prior to the Effective
Time (including with respect to the transactions contemplated by the Merger
Agreement) existing as of May 5, 1999 or at the Effective Time in favor of the
then current or former directors or officers of the Company as provided in the
Company's certificate of incorporation, the Company's By-laws or any
indemnification agreements (each as in effect on May 5, 1999) shall be assumed
by the Surviving Corporation in the Merger, without further action, as of the
Effective Time and shall survive the Merger and shall continue in full force
and effect without amendment, modification or repeal in accordance with their
terms; provided, however, that if any claims are asserted or made during the
continuance of such terms, all rights to indemnification (and to advancement
of expenses) under the Merger Agreement in respect of any such claims shall
continue, without diminution, until disposition of any and all such claims.
(b) The Merger Agreement provides that in the event that Parent, the
Surviving Corporation or any of their successors or assigns (i) consolidates
with or merges into any other person and is not the continuing or surviving
corporation or entity of such consolidation or merger or (ii) transfers or
conveys all or substantially all of its properties and assets to any person,
then, and in each such case, proper provision will be made so that the
successors and assigns of Parent or the Surviving Corporation, as the case may
be, shall expressly assume the obligations set forth under "--
Indemnification". In the event the Surviving Corporation transfers any
material portion of its assets, in a single transaction or in a series of
transactions, Parent has agreed in the Merger Agreement that it will either
guarantee the indemnification obligations referred to in paragraph (a) above
or take such other action to insure that the ability of the Surviving
Corporation, legal and financial, to satisfy such indemnification obligations
will not be diminished in any material respect.
(c) The Merger Agreement provides that the Surviving Corporation shall (i)
maintain for a period of not less than six years from the Effective Time the
Company's current directors' and officers' insurance and indemnification
policy to the extent that it provides coverage for events occurring prior to
the Effective Time (the "D&O Insurance"), for all persons who are directors or
officers of the Company on May 5, 1999 (the "Insured Parties") or (ii) cause
to be provided coverage no less advantageous to the Insured Parties than the
D&O Insurance, in each case so long as the annual premium therefor would not
be in excess of 125% of the last annual premium paid for the D&O Insurance
prior to the date of this Agreement (such 125% amount, the "Maximum Premium").
If the existing D&O Insurance expires, is terminated or canceled during such
six-year period, the Merger Agreement provides that the Surviving Corporation
will use all reasonable efforts to cause to be obtained as much D&O Insurance
as can be obtained for the remainder of such period for an annualized premium
not in excess of the Maximum Premium.
Conditions to the Merger. The Merger Agreement provides that the respective
obligation of each party to effect the Merger shall be subject to the
satisfaction or waiver prior to the closing date of the Merger (the "Closing
Date") of the following conditions (i) if required by applicable law, Company
Stockholder Approval shall have been obtained, (ii) no statute, rule,
decision, regulation, executive order, decree, temporary restraining
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order, preliminary or permanent injunction or other order issued by any court
of competent jurisdiction or other governmental entity preventing the
consummation of the Merger shall be in effect; provided, however, that the
party seeking to invoke such condition shall have performed its obligations
under the Merger Agreement to cooperate and use reasonable efforts to
consummate the transactions contemplated by the Merger Agreement, (iii) the
Purchaser shall have (A) commenced the Offer and (B) purchased, pursuant to
the terms and conditions of such Offer, all Shares duly tendered and not
withdrawn; provided, however, that neither Parent nor the Purchaser shall be
entitled to rely on the condition in clause (B) above if either of them shall
have failed to purchase Shares pursuant to the Offer in breach of their
obligations under the Merger Agreement.
The Merger Agreement also provides that the obligation of the Purchaser and
Parent to effect the Merger shall be subject to the satisfaction or waiver
prior to the Closing Date of the condition that the Company has performed in
all material respects its obligations under the Merger Agreement required to
be performed by it at or prior to the Effective Time.
The Merger Agreement further provides that the obligation of the Company to
effect the Merger shall be subject to the satisfaction or waiver prior to the
Closing Date of the conditions that Parent and the Purchaser have performed in
all material respects each of their respective obligations under the Merger
Agreement required to be performed by it at or prior to the Effective Time.
Termination. The Merger Agreement may be terminated at any time prior to the
Effective Time, whether before or after approval of the terms of it by the
stockholders of the Company:
(a) By mutual written consent of Parent and the Company.
(b) By either Parent or the Company:
(i) if the Offer terminates or expires on account of the failure of any
condition specified in Section 14 without the Purchaser having
purchased any Shares thereunder; provided, however, that the right
to terminate the Merger Agreement pursuant to this paragraph (b)(i)
shall not be available to any party whose failure to perform any of
its obligations under the Merger Agreement results in the failure
of any Offer Condition;
(ii) if any Governmental Entity (as defined in Section 14) shall have
issued an order, decree or ruling or taken any other action
permanently enjoining, restraining or otherwise prohibiting the
acceptance for payment of, or payment for, Shares pursuant to the
Offer or the Merger and such order, decree or ruling or other
action shall have become final and nonappealable; provided,
however, that the party seeking to terminate the Merger pursuant
to this paragraph (b)(ii) shall have performed its obligations to
cooperate and use reasonable efforts to consummate the
transactions contemplated by the Merger Agreement; or
(iii) if the Offer Conditions shall have not been satisfied or waived
on or before September 30, 1999, or if the Effective Time shall
not have occurred on or before November 30, 1999, provided that
the right to terminate the Merger Agreement pursuant to this
paragraph (b)(iii) shall not be available to any party whose
failure to perform any of its obligations under the Merger
Agreement results in the failure of the Effective Time to occur.
(c) By Parent or the Purchaser, prior to the acceptance for payment of the
Minimum Shares pursuant to the Offer, in the event of a breach by the
Company of any representation, warranty, covenant or other agreement
contained in the Merger Agreement that (i) would give rise to the
failure of a condition set forth in paragraph (c) or (d) of Section 14
and (ii) cannot be or has not been cured within 20 days after the
giving of written notice to the Company.
(d) By the Company, if the Purchaser or Parent shall have (A) failed to
commence the Offer within five business days of the public announcement
by Parent and the Company of the execution of the Merger Agreement, (B)
failed to pay for Shares pursuant to the Offer in accordance with the
Merger Agreement or (C) breached in any material respect any of their
respective representations, warranties,
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covenants or other agreements contained in the Merger Agreement, which
breach or failure to perform in respect of clause (C) is incapable of
being cured or has not been cured within 20 days after the giving of
written notice to Parent or the Purchaser, as applicable, except, in any
case under clause (C), such breaches and failures which individually or
in the aggregate are not reasonably likely to affect adversely Parent's
or the Purchaser's ability to complete the Offer or the Merger subject
to the terms and conditions of this Agreement.
(e) By the Company, in accordance with the terms of described in "--No
Solicitation", provided that any termination pursuant to this paragraph
(e) shall not be effective unless the Company shall have complied with
the provisions described in "--Fees and Expenses".
(f) By Parent or the Purchaser, if the Board or any committee thereof shall
(i) withdraw or modify, in any manner adverse to Parent or the
Purchaser, the approval or recommendation by such Board or such
committee of the Offer, the Merger Agreement, or the Merger, (ii)
approve or recommend any Takeover Proposal, or (iii) cause the Company
to enter into any Acquisition Agreement with respect to any Takeover
Proposal.
In the event of a termination of this Agreement by either the Company or
Parent as provided under "--Termination", the Merger Agreement shall forthwith
become void and there shall be no liability or obligation on the part of
Parent, the Purchaser or the Company or their respective officers or
directors, except (A) that Parent and the Purchaser will, upon request,
promptly deliver to the Company any stockholder lists or labels obtained in
connection with the Offer or the Merger, (B) that Parent and the Purchaser
will keep in confidence all information received from the Company or its
subsidiaries in confidence according to the terms of the confidentiality
agreement dated April 14, 1999 between the Company and Parent, (C) that each
party will, subject to its obligations as described in "--Fees and Expenses"
pay all fees and expenses incurred by such party in connection with the Offer,
the Merger, the Merger Agreement and the transactions contemplated by the
Merger Agreement, (D) for the terms of this paragraph, (E) for the obligations
of the parties set forth in "--Fees and Expenses" and (F) for certain
miscellaneous provisions as set out in Article X of the Merger Agreement;
provided, however, that nothing in this paragraph shall relieve any party for
liability for any willful and intentional breach of any provision of the
Merger Agreement.
Fees and Expenses. (a) The Merger Agreement provides that in addition to any
other amounts that may be payable or become payable pursuant to any provision
of the Merger Agreement, if the Merger Agreement is terminated pursuant to
paragraph (c) under "--Termination", then the Company shall promptly reimburse
Parent for all expenses and costs incurred by Parent in connection with the
transactions contemplated by the Merger Agreement up to a maximum of $2.5
million; provided further, that if the Merger Agreement shall have been
terminated pursuant to paragraph (c) under "--Termination" as the result of a
willful and intentional breach by the Company of any representation, warranty,
covenant or other agreement contained in the Merger Agreement that (i) would
give rise to the failure of a condition set forth in paragraph (c) or (d) of
Section 14 and (ii) cannot be or has not been cured within 20 days after the
giving of written notice to the Company, then the Company shall promptly
reimburse Parent for all expenses and costs incurred by Parent in connection
with the transactions contemplated by the Merger Agreement in an additional
amount up to a maximum of $2.0 million (for an aggregate of $4.5 million).
Parent shall provide the Company with notice of the relevant amounts and
include copies of any related bill or receipts.
(b) The Merger Agreement further provides that in addition to any other
amounts that may be payable or become payable pursuant to any provision of the
Merger Agreement, if the Merger Agreement is terminated pursuant to paragraph
(d) under "--Termination"), then Parent shall promptly reimburse the Company
for all expenses and costs incurred by the Company in connection with the
transactions contemplated by the Merger Agreement up to a maximum of $2.5
million. The Company shall provide Parent with notice of the relevant amounts
and include copies of any related bill or receipts.
(c) The Merger Agreement provides that the Company shall pay to Parent the
Termination Fee (as defined below) if (i) the Merger Agreement is terminated
pursuant to the provisions set forth in "--No Solicitation", or
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pursuant to paragraphs (e) or (f) under "--Termination"; or (ii)(A) any person
makes a Takeover Proposal at any time on or after May 5, 1999 and prior to the
acceptance for payment of the Minimum Shares pursuant to the Offer, (B)
thereafter the Merger Agreement is terminated pursuant to either paragraph (c)
or (b)(i) under "--Termination" (due, in the case of paragraph (b)(i), solely
to a failure of the Minimum Condition), and (C) within 12 months of such
termination the Company enters into an agreement (other than a customary
confidentiality agreement) with respect to, or consummates, a Takeover
Proposal.
The term "Termination Fee" shall mean $15 million less the aggregate amount
of any expense reimbursements paid or payable under paragraph (a) above. The
Termination Fee shall be liquidated damages and not a penalty. The parties
agreed in the Merger Agreement that such amount is a reasonable estimate of
the costs and expenses that would be incurred and the value of services
consumed by and on behalf of Parent and the Purchaser if the transactions
contemplated thereunder were not to go forward as a result of such a
termination.
Extension; Waiver. Except as set forth under "--Procedure for Termination,
Amendment, Extension or Waiver", the Merger Agreement provides that at any
time prior to the Effective Time, the parties to the Merger Agreement, by
action taken or authorized by their respective Boards of Directors, may, to
the extent legally allowed, (i) extend the time for the performance of any of
the obligations or other acts of the other parties to the Merger Agreement,
(ii) waive any inaccuracies in the representations and warranties of the other
parties to the Merger Agreement contained in the Merger Agreement or in any
document delivered pursuant thereto or (iii) except as set forth in "--
Amendment", waive compliance with any of the agreements or conditions of the
other parties to the Merger Agreement contained in the Merger Agreement. Any
agreement on the part of a party to the Merger Agreement to any such extension
or waiver shall be valid only if set forth in a written instrument signed on
behalf of such party. The failure of any party to the Merger Agreement to
assert any of its rights under the Merger Agreement or otherwise shall not
constitute a waiver of those rights.
Amendment. Except as set forth under "--Procedure for Termination,
Amendment, Extension or Waiver", the Merger Agreement provides that it may be
amended by the parties thereto, by action taken or authorized by their
respective Boards of Directors, at any time before or after obtaining Company
Stockholder Approval (if required by law), but, after any such approval, no
amendment shall be made that by law requires further approval by such
stockholders without obtaining such further approval. The Merger Agreement may
not be amended except by an instrument in writing signed on behalf of each of
the parties thereto.
Procedure for Termination, Amendment, Extension or Waiver. The Merger
Agreement provides that a termination of the Merger Agreement pursuant to "--
Termination", an amendment of the Merger Agreement pursuant to "--Amendment"
or an extension or waiver pursuant to "--Extension; Waiver" shall, in order to
be effective, require in the case of Parent, the Purchaser or the Company,
action by its Board of Directors or the duly authorized designee of its Board
of Directors; provided, however, that in the event that the Purchaser's
designees are appointed or elected to the Board as provided in "--Directors",
after the acceptance for payment and payment of Shares pursuant to and subject
to the Offer Conditions of the Offer and prior to the Effective Time, the
affirmative vote of a majority of the Continuing Directors shall be required
by the Company to (i) amend or terminate the Merger Agreement by the Company,
(ii) exercise or waive any of the Company's rights or remedies under the
Merger Agreement, (iii) extend the time for performance of Parent's and the
Purchaser's respective obligations under the Merger Agreement or (iv) take any
action to amend or otherwise modify the Company's certificate of incorporation
or the Company's By-laws.
11. PURPOSE OF THE OFFER; PLANS FOR THE COMPANY AFTER THE OFFER AND THE MERGER
Purpose of the Offer. The purpose of the Offer is for Parent to acquire
control of, and the entire equity interest in, the Company. Following the
Offer, the Purchaser and Parent intend to acquire any remaining equity
interest in the Company not acquired in the Offer by consummating the Merger.
Upon consummation of the Merger, the Company will be a wholly owned subsidiary
of Parent. The Offer is being made pursuant to the Merger Agreement.
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The DGCL requires, among other things, that the adoption of any plan of
merger or consolidation of the Company must be approved and found advisable by
the Board and by the holders of the Company's outstanding voting securities.
The Board has approved the Offer and the Merger; consequently, the only
additional action of the Company that may be necessary to effect the Merger is
approval by the Company's stockholders if the "short-form" merger procedure
described below is not available. Under the DGCL, the affirmative vote of
holders of a majority of the outstanding Shares (including any Shares owned by
the Purchaser) is required to approve the Merger. If the Purchaser acquires,
through the Offer or otherwise, voting power with respect to at least a
majority of the outstanding Shares, it would have sufficient voting power to
effect the Merger without the vote of any other stockholder of the Company.
However, the DGCL also provides that if a parent company owns at least 90% of
each class of stock of a subsidiary, the parent company can effect a short-
form merger with that subsidiary without the action of the other stockholders
of the subsidiary. Accordingly, if, as a result of the Offer or otherwise, the
Purchaser acquires or controls the voting power of at least 90% of the
outstanding Shares, the Purchaser could, and intends to, effect the Merger
without prior notice to, or any action by, any other stockholder of the
Company.
In the Merger Agreement, the Company has agreed to take all action necessary
to convene a meeting of its stockholders, if necessary, as soon as practicable
after the consummation of the Offer for the purpose of considering and voting
upon the Merger Agreement and the transactions contemplated thereby. Parent
and the Purchaser have agreed that all Shares owned by them and their
subsidiaries will be voted in favor of the Merger Agreement and the
transactions contemplated thereby.
Promptly upon the Purchaser's acceptance for payment of Shares purchased
pursuant to the Offer, the Merger Agreement provides that the Purchaser will
be entitled to designate a majority of the directors of the Board. See Section
10. The Purchaser expects that such representation would permit the Purchaser
to exert substantial influence over the Company's conduct of its business and
operations.
Dissenters' Rights. Holders of Shares do not have dissenters' rights as a
result of the Offer. However, if the Merger is consummated, holders of Shares
may have rights pursuant to the provisions of Section 262 of the DGCL to
dissent and demand appraisal of, and to receive payment in cash of the fair
value of, their Shares. If the statutory procedures were complied with, such
rights could lead to a judicial determination of the fair value required to be
paid in cash to such dissenting holders for their Dissenting Shares. Any such
judicial determination of the fair value of the Dissenting Shares could be
based upon considerations other than, or in addition to, the Offer Price, the
market value of the Dissenting Shares, including asset values, and the
investment value of the Dissenting Shares. The value so determined could be
greater or lower than the Offer Price.
If any holder of Shares who demands appraisal under Section 262 of the DGCL
fails to perfect, or effectively withdraws or loses his, her or its right to
appraisal, as provided in the DGCL, the Shares of such stockholder will be
converted into the right to receive the consideration payable in the Merger in
accordance with the Merger Agreement. A stockholder may withdraw his, her or
its demand for appraisal by delivery to Parent of a written withdrawal of his,
her or its demand for appraisal and acceptance of the terms of the Merger.
A stockholder seeking to exercise dissenters' rights under Section 262 of
the DGCL may not tender his, her or its Shares in the Offer and will be
further advised by the Company as to the steps necessary to exercise such
rights. FAILURE TO FOLLOW THE STEPS REQUIRED BY SECTION 262 OF THE DGCL FOR
PERFECTING APPRAISAL RIGHTS MAY RESULT IN THE LOSS OF SUCH RIGHTS.
Going Private Transactions. The Commission has adopted Rule 13e-3 under the
Exchange Act which is applicable to certain "going private" transactions and
which may under certain circumstances be applicable to the Merger or another
business combination following the purchase of Shares pursuant to the Offer in
which the Purchaser seeks to acquire the remaining Shares not held by it.
However, Rule 13e-3 will not be applicable to the Merger or any such other
business combination if (i) the Shares are deregistered under the Exchange Act
prior to the Merger or other business combination or (ii) the Merger or other
business combination is consummated within one year after the purchase of the
Shares pursuant to the Offer and the value of the
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consideration paid per Share in the Merger or other business combination
(measured at the time of consummation of the Merger) is at least equal to the
amount paid per Share in the Offer. If applicable, Rule 13e-3 requires, among
other things, that certain financial information concerning the Company and
certain information relating to the fairness of the proposed transaction and
the consideration offered to minority stockholders in such transaction be
filed with the Commission and disclosed to stockholders prior to consummation
of the transaction.
Plans for the Company. It is expected that, initially following the Merger,
the business and operations of the Company will, except as set forth in this
Offer to Purchase, be continued by the Company substantially as they are
currently being conducted. Parent has no current plans related to any change
in the management of the Company. Parent will continue to evaluate the
business and operations of the Company during the pendency of the Offer and
after the consummation of the Offer and the Merger, and will take such actions
as it deems appropriate under the circumstances then existing. Parent intends
to seek additional information about the Company during this period.
Thereafter, Parent intends to review such information as part of a
comprehensive review of the Company's business, operations, capitalization and
management with a view to combining the complementary technical and geographic
strengths of the Company and Parent.
Except as indicated in this Offer to Purchase, Parent does not have any
present plans or proposals that relate to or would result in an extraordinary
corporate transaction, such as a merger, reorganization or liquidation,
involving the Company or any of its subsidiaries, a sale or transfer of a
material amount of assets of the Company or any of its subsidiaries, any
material change in the Company's capitalization or any other material change
in the Company's corporate structure or business. However, Parent does not
expect to maintain Company's current dividend policy.
12.DIVIDENDS AND DISTRIBUTIONS
The Merger Agreement provides that the Company may not, between the date of
the Merger Agreement and the effective date of the Merger, without the prior
written consent of Parent, (a) issue, deliver, sell, pledge or otherwise
encumber any shares of its capital stock, any other voting securities or any
securities convertible into, or any rights, warrants or options to acquire,
any such shares, voting securities or convertible securities (other than the
issuance of shares of Company Common Stock upon the exercise of Company Stock
Options outstanding on May 5, 1999 in accordance with their then present
terms); or (b) (i) declare, set aside or pay any dividends on, or make any
other distributions in respect of, any of its capital stock, other than (A)
dividends and distributions by a direct or indirect wholly-owned subsidiary of
the Company to its parent, (B) contractually required distributions to
partners in joint ventures, and (C) earn-out payments in connection with
acquisitions consummated prior to the date of the Merger Agreement as set
forth certain disclosure schedules to the Merger Agreement, (ii) split,
combine or reclassify any of its capital stock or issue or authorize the
issuance of any other securities in respect of, in lieu of or in substitution
for shares of its capital stock, or (iii) purchase, redeem or otherwise
acquire any shares of its capital stock or any other securities thereof or any
rights, warrants or options to acquire any such shares or other securities.
See Section 10.
13. EFFECT OF THE OFFER ON THE MARKET FOR THE SHARES, EXCHANGE LISTING AND
EXCHANGE ACT REGISTRATION
The purchase of Shares by the Purchaser pursuant to the Offer will reduce
the number of Shares that might otherwise trade publicly and will reduce the
number of holders of Shares, which could adversely affect the liquidity and
market value of the remaining Shares held by the public.
Depending upon the number of Shares purchased pursuant to the Offer, the
Shares may no longer meet the requirements of the NYSE for continued listing
and may be delisted from the NYSE. According to the NYSE's published
guidelines, the NYSE would consider delisting the Shares if, among other
things, the number of total stockholders is less than 400, or less than 1,200
and average monthly trading volume (for most recent twelve months) is less
than 100,000 shares; the number of publicly held Shares (exclusive of holdings
of officers, directors and their immediate families and other concentrated
holdings of ten percent or more ("NYSE Excluded Holdings")) should fall below
600,000; or the aggregate market value of publicly held Shares (exclusive of
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NYSE Excluded Holdings) should fall below $8,000,000. If as a result of the
purchase of Shares pursuant to the Offer or otherwise, the Shares no longer
meet the requirements of the NYSE for continued listing and the listing of the
Shares is discontinued, the market for the Shares could be adversely affected.
If the NYSE were to delist the Shares, it is possible that the Shares would
continue to trade on another securities exchange or in the over-the-counter
market and that price or other quotations would be reported by such exchange
or through the National Association of Securities Dealers Automated Quotation
System ("Nasdaq") or other sources. The extent of the public market therefor
and the availability of such quotations would depend, however, upon such
factors as the number of stockholders and/or the aggregate market value of the
Shares remaining at such time, the interest in maintaining a market in the
Shares on the part of securities firms, the possible termination of
registration under the Exchange Act as described below and other factors. The
Purchaser cannot predict whether the reduction in the number of Shares that
might otherwise trade publicly would have an adverse or beneficial effect on
the market price for or marketability of the Shares or whether it would cause
future market prices to be greater or less than the Offer Price.
The Shares are currently "margin securities," as such term is defined under
the rules of the Board of Governors of the Federal Reserve System (the
"Federal Reserve Board"), which has the effect, among other things, of
allowing brokers to extend credit on the collateral of the Shares. Depending
upon factors similar to those described above regarding listing and market
quotations, following the Offer it is possible that the Shares might no longer
constitute "margin securities" for purposes of the margin regulations of the
Federal Reserve Board, in which event such Shares could no longer be used as
collateral for loans made by brokers.
The Shares are currently registered under the Exchange Act. Such
registration may be terminated upon application by the Company to the
Commission if the Shares are not listed on a national securities exchange and
there are fewer than 300 record holders. The termination of the registration
of the Shares under the Exchange Act would substantially reduce the
information required to be furnished by the Company to holders of Shares and
to the Commission and would make certain provisions of the Exchange Act, such
as the short-swing profit recovery provisions of Section 16(b) of the Exchange
Act, the requirement of furnishing a proxy statement in connection with
stockholders' meetings and the requirements of Rule 13e-3 under the Exchange
Act with respect to "going private" transactions, no longer applicable to the
Shares. In addition, "affiliates" of the Company and persons holding
"restricted securities" of the Company may be deprived of the ability to
dispose of their Shares pursuant to Rule 144 promulgated under the Securities
Act. If registration of the Shares under the Exchange Act were terminated, the
Shares would no longer be "margin securities" or be eligible for NYSE or
Nasdaq reporting. The Purchaser currently intends to seek to cause the Company
to terminate the registration of the Shares under the Exchange Act as soon
after consummation of the Offer as the requirements for termination of
registration are met.
14.CERTAIN CONDITIONS OF THE OFFER
Notwithstanding any other term of the Offer, the Purchaser shall not be
required to accept for payment or, subject to any applicable rules and
regulations of the Commission, including Rule 14e-1(c) under the Exchange Act
(relating to the Purchaser's obligation to pay for or return tendered Shares
after the termination or withdrawal of the Offer), to pay for any Shares
tendered pursuant to the Offer unless: (i) the number of Shares tendered and
not withdrawn shall equal more than 50% (the "Minimum Shares") of the Fully
Diluted Shares (defined below) (the "Minimum Condition") prior to the date
which is 20 business days following the commencement of the Offer in
accordance with the terms of the Merger Agreement or such later date as the
Offer may be extended by an amendment to the Merger Agreement in accordance
with the provisions described in Section 10 "--The Merger Agreement--
Amendment" or as described in Section 1; (ii) any waiting period under the HSR
Act applicable to the purchase of Shares pursuant to the Offer shall have
expired or been terminated; and (iii) the Funding Conditions (as defined
below) shall have been satisfied or waived. "Fully Diluted Shares" means all
outstanding securities entitled generally to vote in the election of directors
of the Company on a fully diluted basis, after giving effect to the exercise
or conversion of all options, rights and securities exercisable or convertible
into such voting securities. "Funding Conditions" means the conditions
expressly specified in the
33
<PAGE>
RCBA Commitment, the Bridge Loan Commitment Letter and the Senior Bank
Financing Commitment Letter. The Merger Agreement also provides that,
notwithstanding any other term of the Offer, the Purchaser shall not be
required to accept for payment or, subject as aforesaid, to pay for any Shares
not theretofore accepted for payment or paid for, and may terminate the Offer,
subject to the terms and conditions of the Merger Agreement and the
Purchaser's obligation to extend the Offer as described in Section 1, if, at
any time on or after the date of the Merger Agreement and before the
acceptance of such Shares for payment or the payment therefor, any of the
following conditions exists:
(a) a Governmental Entity (as defined below) shall have enacted, issued,
promulgated, enforced or entered any statute, rule, regulation,
injunction or other order which is in effect and has the effect of
making the acquisition of Shares by the Purchaser illegal or prohibits
or imposes material limitations on the ability of the Purchaser to
acquire Shares or otherwise prohibiting (directly or indirectly)
consummation of the transactions contemplated by the Merger Agreement
or prohibits or imposes material limitations on the ability of Parent
to own or operate all or a material portion of the Company's and its
subsidiaries' businesses or assets, taken as a whole, subject to
Parent's and the Purchaser's obligations to extend the Offer as
described in Section 1, their obligations under the Merger Agreement to
use reasonable efforts to consummate the Offer and Parent's agreement
not to terminate the Offer as long as any such injunction or order has
not become final and non-appealable;
(b) there shall have occurred any Material Adverse Change (as defined
below) with respect to the Company;
(c) any of the representations and warranties of the Company set forth in
the Merger Agreement that are qualified as to materiality shall not be
true and correct, or any such representations and warranties that are
not so qualified shall not be true and correct in any material respect,
in each case at the date of the Merger Agreement and at the scheduled
or extended expiration of the Offer (unless a representation speaks as
of an earlier date, in which case it shall be deemed to have been made
as of such earlier date), which breaches have not been cured within ten
business days after the giving of written notice to the Company;
(d) the Company shall have failed to perform in any material respect any
material obligation or to comply in any material respect with any
material agreement or material covenant of the Company to be performed
or complied with by it under the Merger Agreement, which breaches have
not been cured within ten business days after the giving of written
notice to the Company; or
(e) the Merger Agreement shall have been terminated in accordance with its
terms;
which, in the reasonable judgment of Parent or the Purchaser in any such case,
and regardless of the circumstances (including any action or omission by
Parent or the Purchaser) giving rise to any such condition, makes it
inadvisable to proceed with such acceptance for payment or payments therefor.
For the purposes of the Merger Agreement, "Governmental Entity" means any
Federal, state, local or foreign government or any court, administrative
agency, tribunal or commission or other governmental authority or
instrumentality, domestic, foreign or international; and "Material Adverse
Change" means any change which is reasonably likely to have any effect that is
materially adverse to the business, financial condition or results of
operations of such person and its subsidiaries, taken as a whole, or would
prevent or materially impede with, hinder or delay the consummation of the
Offer, the Merger or any other transaction contemplated in the Merger
Agreement.
The foregoing conditions in paragraphs (a) through (e) are for the sole
benefit of the Purchaser and Parent and may, subject to the terms of the
Merger Agreement and except for the Minimum Condition, be waived by the
Purchaser and Parent in whole or in part at any time and from time to time in
their sole discretion. The failure by Parent or the Purchaser at any time to
exercise any of the foregoing rights shall not be deemed a waiver of any such
right, the waiver of any such right with respect to particular facts and
circumstances shall not be deemed a waiver with respect to any other facts and
circumstances and each such right shall be deemed an ongoing right that may be
asserted at any time and from time to time.
34
<PAGE>
15.CERTAIN LEGAL MATTERS AND REGULATORY APPROVALS
General. Based upon its examination of publicly available information with
respect to the Company, the review of certain information furnished by the
Company to Parent and discussions of representatives of Parent with
representatives of the Company during Parent's investigation of the Company
(see Section 10), neither the Purchaser nor Parent is aware of any license or
other 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 by the Purchaser pursuant to the Offer
or, except as set forth below, of any approval or other action by any domestic
(federal or state) or foreign governmental, administrative or regulatory
authority or agency that would be required prior to the acquisition of Shares
by the Purchaser pursuant to the Offer. Should any such approval or other
action be required, it is the Purchaser's present intention to seek such
approval or action. 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 business of the Company, the
Purchaser or Parent or that certain parts of the businesses of the Company,
the Purchaser or Parent might not have to be disposed of or held separate or
other substantial conditions complied with in order to obtain such approval or
other action or in the event that such approval was not obtained or such other
action was not taken. The Purchaser's obligation under the Offer to accept for
payment, and pay for, Shares is subject to certain conditions, including
conditions relating to the legal matters discussed in this Section 15. See
Section 14.
State Takeover Laws. The Company is incorporated under the laws of the State
of Delaware. In general, Section 203 of the DGCL prevents an "interested
stockholder" (generally a person who owns or has the right to acquire 15% or
more of a corporation's outstanding voting stock or an affiliate or associate
thereof) from engaging in a "business combination" (defined to include mergers
and certain other transactions) with a Delaware corporation for a period of
three years following the date such person became an interested stockholder
unless, among other things, prior to such date the board of directors of the
corporation approved either the business combination or the transaction in
which the interested stockholder became an interested stockholder. The Board
has approved the Merger Agreement and the Purchaser's acquisition of Shares
pursuant to the Offer and the Merger and, therefore, Section 203 of the DGCL
is inapplicable to the Merger.
A number of other states have adopted laws and regulations applicable to
attempts to acquire securities of corporations that are incorporated, or have
substantial assets, stockholders, principal executive offices or principal
places of business, or whose business operations otherwise have substantial
economic effects, in such states. In Edgar v. Mite Corp., the Supreme Court of
the United States invalidated on constitutional grounds the Illinois Business
Takeover Statute, that, as a matter of state securities law, made takeovers of
corporations meeting certain requirements more difficult. However, in 1987 in
CTS Corp. v. Dynamics Corp. of America, the Supreme Court held that the State
of Indiana may, as a matter of corporate law and, in particular, with respect
to those aspects of corporate law concerning corporate governance,
constitutionally disqualify a potential acquiror from voting on the affairs of
a target corporation without the prior approval of the remaining stockholders,
provided that such laws were applicable only under certain conditions.
Subsequently, in TLX Acquisition Corp. v. Telex Corp., a Federal district
court in Oklahoma ruled that the Oklahoma statutes were unconstitutional
insofar as they applied to corporations incorporated outside Oklahoma in that
they would subject such corporations to inconsistent regulations. Similarly,
in Tyson Foods, Inc. v. McReynolds, a Federal district court in Tennessee
ruled that four Tennessee takeover statutes were unconstitutional as applied
to corporations incorporated outside Tennessee. This decision was affirmed by
the United States Court of Appeals for the Sixth Circuit. In December 1988, a
federal district court in Florida held in Grand Metropolitan plc v.
Butterworth that the provisions of the Florida Affiliated Transactions Act and
Florida Control Share Acquisition Act were unconstitutional as applied to
corporations incorporated outside of Florida.
The Company, directly or through subsidiaries, conducts business in a number
of states throughout the United States, some of which may have enacted
takeover laws. The Purchaser does not know whether any of these laws will, by
their terms, apply to the Offer or the Merger and has not attempted to comply
with any such laws. Should any person seek to apply any state takeover law,
the Purchaser reserves the right to challenge the validity or applicability of
any such statute allegedly applicable to the Offer in appropriate court
proceedings or
35
<PAGE>
otherwise, and nothing contained in this Offer to Purchase nor any action
taken in connection herewith is intended as a waiver of that right. In the
event it is asserted that one or more state takeover laws applies 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, the Purchaser
might be required to file certain information with, or receive approvals from,
the relevant state authorities. In addition, if enjoined, the Purchaser might
be unable to accept for payment any Shares tendered pursuant to the Offer or
be delayed in continuing or consummating the Offer and the Merger. In such
case, the Purchaser may not be obligated to accept for payment, or pay for,
any Shares tendered. See Section 14.
Antitrust. Under the HSR Act and the rules that have been promulgated
thereunder by the Federal Trade Commission (the "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 by the Purchaser pursuant to the
Offer is subject to such requirements. See Section 2.
Pursuant to the HSR Act, Parent filed Premerger Notification and Report
Forms (the "HSR Reports") with the Antitrust Division and the FTC in
connection with the purchase of Shares pursuant to the Offer (the "Tender
Filing") and in connection with the Equity Contribution (the "Equity
Contribution Filing"). Both HSR Reports were filed on May 7, 1999. Under the
provisions of the HSR Act applicable to the Offer, Parent may not consummate
the purchase of Shares pursuant to the Offer until the expiration or early
termination of a 15-calendar day waiting period following the Tender Filing
and may not consummate the Equity Contribution until the expiration or early
termination of a 30-calendar day waiting period following the Equity
Contribution Filing. Pursuant to the HSR Act, Parent requested early
termination of the waiting period applicable to the Tender Filing and the
Equity Contribution Filing. There can be no assurance, however, that either
the 15-day HSR Act waiting period in connection with the Tender Filing or the
30-day HSR Act waiting period in connection with the Equity Contribution
Filing will be terminated early. If either the FTC or the Antitrust Division
were to request additional information or documentary material from Parent
with respect to the Tender Filing, the waiting period with respect to the
Offer would expire at 11:59 p.m., New York City time, on the tenth calendar
day after the date of substantial compliance by Parent with such request.
Thereafter, the waiting period could be extended only by court order. If the
acquisition of Shares is delayed pursuant to a request by the FTC or the
Antitrust Division for additional information or documentary material pursuant
to the HSR Act, the Offer may, but need not, be extended and, in any event,
the purchase of and payment for Shares will be deferred until ten days after
the request is substantially complied with or unless the waiting period is
sooner terminated by the FTC and the Antitrust Division. The HSR Act and the
rules promulgated thereunder authorize only one extension of each statutory
waiting period pursuant to a request for additional information, except by
court order. Any extension of the waiting periods will not give rise to any
withdrawal rights not otherwise provided for by applicable law. See Section 4.
It is a condition to the Offer that the waiting periods applicable under the
HSR Act to each of the Offer and the Equity Contribution expire or be
terminated. See Section 2 and Section 14.
The FTC and the Antitrust Division frequently scrutinize the legality under
the antitrust laws of transactions such as the proposed acquisition of Shares
by the Purchaser pursuant to the Offer and the acquisition comprising the
Equity Contribution. At any time before or after the purchase of Shares
pursuant to the Offer by the Purchaser or the consummation of the Equity
Contribution, the FTC or the Antitrust Division could take such action under
the antitrust laws as it deems necessary or desirable in the public interest,
including seeking to enjoin the purchase of Shares pursuant to the Offer,
seeking to enjoin the Equity Contribution or seeking the divestiture of Shares
purchased by the Purchaser or the divestiture of substantial assets of Parent,
the Company or their respective subsidiaries. Private parties and state
attorneys general may also bring legal action under federal or state antitrust
laws under certain circumstances. Based upon an examination of information
available to Parent relating to the businesses in which RBCA, Parent, the
Company and their respective subsidiaries are engaged, Parent and the
Purchaser believe that neither the Offer nor the Equity Contribution will
violate the antitrust laws. Nevertheless, there can be no assurance that a
challenge to the Offer or the Equity Contribution on antitrust grounds will
not be made or, if such a challenge is made, what the result would be. See
Section 14 for certain conditions to the Offer, including conditions with
respect to litigation.
36
<PAGE>
16.FEES AND EXPENSES
Except as set forth below, the Purchaser will not pay any fees or
commissions to any broker, dealer or other person for soliciting tenders of
Shares pursuant to the Offer.
Morgan Stanley, financial advisor to Parent in connection with the
acquisition of the Company, is acting as Dealer Manager for the Offer. No fee
is payable to Morgan Stanley for acting as Dealer Manager, as such, but Parent
has agreed to pay Morgan Stanley for its financial advisory services rendered
to Parent in connection with the acquisition: (i) a fee of $1.25 million,
payable upon public announcement of the execution of the Merger Agreement and
upon delivery of the fairness opinion described in Section 10 and (ii) if the
acquisition is completed, a fee of approximately $6 million, against which the
previous fee will be credited. Parent has also agreed to reimburse Morgan
Stanley for expenses incurred by it, including the fees of outside counsel,
and to indemnify Morgan Stanley against certain liabilities and expenses in
connection with its engagement as financial advisor and Dealer Manager,
including certain liabilities under the federal securities laws.
The Purchaser and Parent have retained D.F. King & Co., Inc., as the
Information Agent, and ChaseMellon Shareholder Services, L.L.C., as the
Depositary, in connection with the Offer. The Information Agent may contact
holders of Shares by mail, telephone, telex, telecopy, telegraph and personal
interview and may request banks, brokers, dealers and other nominee
stockholders to forward materials relating to the Offer to beneficial owners.
The Information Agent and the Depositary will receive reasonable and
customary compensation for their services in connection with the Offer, plus
reimbursement for their reasonable out-of-pocket expenses, and will be
indemnified against certain liabilities in connection with the Offer,
including certain liabilities under the federal securities laws. Brokers,
dealers, commercial banks and trust companies will be reimbursed by the
Purchaser for customary handling and mailing expenses incurred by them in
forwarding material to their customers.
17.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 laws of
such jurisdiction. Neither the Purchaser nor Parent is aware of any
jurisdiction in which the making of the Offer or the tender of Shares in
connection therewith would not be in compliance with the laws of such
jurisdiction. To the extent the Purchaser or Parent becomes aware of any state
law that would limit the class of offerees in the Offer, the Purchaser will
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
where the 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 the Dealer Manager or by one or more registered brokers or
dealers licensed under the laws of such jurisdiction.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION ON BEHALF OF THE PURCHASER OR THE COMPANY NOT CONTAINED IN THIS
OFFER TO PURCHASE OR IN THE LETTER OF TRANSMITTAL, AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN
AUTHORIZED.
Pursuant to Rule 14d-3 of the General Rules and Regulations under the
Exchange Act, Parent and the Purchaser have filed with the Commission the
Schedule 14D-1, together with exhibits, furnishing certain additional
information with respect to the Offer. The Schedule 14D-1 and any amendments
thereto, including exhibits, may be inspected at, and copies may be obtained
from, the same places and in the same manner as set forth in Section 7 "--
Available Information" (except that they will not be available at the regional
offices of the Commission).
Demeter Acquisition Corporation
May 11, 1999
37
<PAGE>
FACSIMILES OF THE LETTER OF TRANSMITTAL WILL BE ACCEPTED. THE LETTER OF
TRANSMITTAL AND CERTIFICATES EVIDENCING SHARES AND ANY OTHER REQUIRED
DOCUMENTS SHOULD BE SENT OR DELIVERED BY EACH STOCKHOLDER OR HIS, HER OR ITS
BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR OTHER NOMINEE TO THE
DEPOSITORY AT ITS ADDRESS SET FORTH ON THE LAST PAGE OF THIS OFFER TO
PURCHASE.
38
<PAGE>
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF
PARENT AND PURCHASER
1. DIRECTORS AND EXECUTIVE OFFICERS OF PARENT. The following table sets
forth the name, current business address, citizenship and present principal
occupation or employment, and material occupations, positions, offices or
employments during the last five years, of each director and executive officer
of Parent. Unless otherwise indicated, the current business address of each
person is 100 California Street, Suite 500, San Francisco, CA 94111. Each such
person is a citizen of the United States of America and, unless
otherwise indicated, has held his or her present position as set forth below
for the past five years. Unless otherwise indicated, each occupation set forth
opposite an individual's name refers to employment with Parent.
DIRECTORS
<TABLE>
<CAPTION>
POSITION WITH PARENT; PRINCIPAL OCCUPATION OR EMPLOYMENT;
NAME AND BUSINESS ADDRESS 5-YEAR EMPLOYMENT HISTORY
------------------------- ---------------------------------------------------------
<C> <S>
Richard C. Blum....................... Chairman and President, Richard C. Blum &
909 Montgomery Street, Suite 400 Associates, Inc., the sole general partner of
San Francisco, CA 94133 Richard C. Blum & Associates, L.P., a merchant
banking and equity investment management firm;
Vice Chairman of the Board of Directors and
financial consultant to Parent; Director of
Northwest Airlines Corporation since 1989;
Director of Shaklee Corporation since 1990;
Director of CB Richard Ellis since 1993; Co-
Chairman of Newbridge Capital since 1997; Director
of Glenborough Realty Trust, Inc. since 1998;
Director of Playtex Products, Inc. since 1998.
Armen Der Marderosian................. Executive Vice President, Technology and Systems
77 "A" Street since 1988 and Senior Vice President, Technology
Needham, MA 02494 and Systems from 1995 to 1997, of GTE Corporation;
Executive Vice President and General Manager, 1993
to 1995, GTE Government Systems Corporation.
Admiral S. Robert Foley, Jr........... Senior Advisor to Raytheon Corporation since 1998;
USN (Ret.) Vice President of Raytheon International, Inc. and
President of Raytheon Japan from 1995 to 1998;
Director of Frequency Electronics since 1999;
Director of RSI Inc. since 1998; Director of SAGE
Laboratories since 1998; Director of Filtronics
Solid State since 1998.
Robert D. Glynn, Jr................... Chairman of the Board since 1998 and Chief
One Market Street Executive Officer and President since 1997 of PG&E
Spear Street Tower, Suite 2400 Corporation and Chairman of the Board of Pacific
San Francisco, CA 94105 Gas and Electric Company since 1998; Officer of
PG&E Corporation since 1996 and Officer of Pacific
Gas and Electric Company since 1988; Director of
Pacific Gas and Electric Company since 1995 and of
PG&E Corporation since 1996.
Martin M. Koffel...................... Chief Executive Officer and President of the
Company since May 1989; Chairman of the Board
since June 1989.
</TABLE>
39
<PAGE>
<TABLE>
<CAPTION>
POSITION WITH PARENT; PRINCIPAL OCCUPATION OR EMPLOYMENT;
NAME AND BUSINESS ADDRESS 5-YEAR EMPLOYMENT HISTORY
------------------------- ---------------------------------------------------------
<C> <S>
Richard B. Madden....................- Retired Chairman and Chief Executive Officer since
100 Larkspur Landing Circle, Suite 1994 and Director since 1971, of Potlatch
210 Corporation; Director of PG&E Corporation since
Larkspur, CA 94939 1996 and Pacific Gas and Electric Company since
1977; Director of CNF Transportation Inc. since
1992.
Jean-Yves Perez....................... Executive Vice President of URS Greiner Woodward
Clyde, since November 1998; President of Woodward-
Clyde Group, Inc., a division of Parent, from
November 1997 to October 1998; President and Chief
Executive Officer of Woodward-Clyde Group, Inc.
from 1987 to October 1997.
Richard Q. Praeger.................... Management and engineering consultant since 1974;
Owner, Transition Books, a bookstore, since 1979;
prior to November 1974, President, URS/Madigan-
Praeger, Incorporated.
Irwin L. Rosenstein................... President of URS Greiner Woodward Clyde, since
November 1998; President of URS Greiner, Parent's
former principal operating division, from November
1997 to October 1998; President of URS
Consultants, Inc., Parent's former principal
operating division, from February 1989 to October
1997; Vice President of Parent since 1987.
William D. Walsh...................... Chairman of Sequoia Associates LLC, a private
3000 Sand Hill Road investment firm, since 1982; Chairman of the
Building II, Suite 140 Board, Consolidated Freightways Corporation since
Menlo Park, CA 94025 1996 and Director of Consolidated Freightways,
Inc. from 1994 to 1996; Chairman of the Board of
Newell Manufacturing Corporation and Newell
Industrial Corporation since 1988; Chairman of the
Board of Clayton Group, Inc. since 1996; Director
of Newcourt Credit Group since 1993; Director of
Basic Vegetable Products since 1990; Director of
Crown Vantage, Inc. since 1996; Director of Unova,
Inc. since 1997; Director of Bemiss Jason since
1998; Chairman of the Board of Champion Road
Machinery from 1988 to 1997; Director of National
Education Corporation from 1982 to 1997.
EXECUTIVE OFFICERS
<CAPTION>
POSITION WITH PARENT; PRINCIPAL OCCUPATION OR
EMPLOYMENT;
NAME, AGE AND BUSINESS ADDRESS 5-YEAR EMPLOYMENT HISTORY
------------------------------ ---------------------------------------------
<C> <S>
Martin M. Koffel...................... Chief Executive Officer, President and Director
from May 1989; Chairman of the Board from June
1989.
Kent P. Ainsworth..................... Executive Vice President from April 1996, Vice
President and Chief Financial Officer from January
1991; Secretary from May, 1994.
Joseph Masters........................ Vice President and General Counsel since July
1997, Vice President, Legal, from April 1994 to
June 1997; Vice President and Associate General
Counsel of URS Consultants, Inc. from May 1992 to
April 1994; outside counsel to the Company from
January 1990 to May 1992.
</TABLE>
40
<PAGE>
<TABLE>
<CAPTION>
POSITION WITH PARENT; PRINCIPAL OCCUPATION OR
EMPLOYMENT;
NAME AND BUSINESS ADDRESS 5-YEAR EMPLOYMENT HISTORY
------------------------- ---------------------------------------------
<C> <S>
Irwin L. Rosenstein................... President of URSGWC, Parent's principal operating
division, since November 1998; President of URSG
from November 1997 to October 1998, President of
URS Consultants, Inc., Parent's former principal
operating division, from February 1989 to November
1997; Director since February 1989; Vice President
since 1987.
Jean-Yves Perez....................... Director of the Company and Executive Vice
President of URSGWC, Parent's principal operating
division, since November 1998; President of
Woodward-Clyde Group, Inc. ("W-C"), a division of
Parent from November 1997 to October 1998;
Director since November 1997; President and Chief
Executive Officer of W-C from 1987 to October
1997.
</TABLE>
2. DIRECTORS AND EXECUTIVE OFFICERS OF THE PURCHASER. The directors of the
Purchaser are Martin M. Koffel, Kent P. Ainsworth and Joseph Masters. The
executive officers of the Purchaser are Martin M. Koffel (Chairman of the
Board, President and Chief Executive Officer), Kent P. Ainsworth (Chief
Financial Officer and Treasurer) and Joseph Masters (Secretary). The
biographical information for such directors and executive officers is listed
above.
41
<PAGE>
FACSIMILE COPIES OF THIS LETTER OF TRANSMITTAL, PROPERLY COMPLETED AND DULY
EXECUTED, WILL BE ACCEPTED. THIS LETTER OF TRANSMITTAL, SHARE CERTIFICATES AND
ANY OTHER REQUIRED DOCUMENTS SHOULD BE SENT OR DELIVERED BY EACH TENDERING
STOCKHOLDER OF THE COMPANY OR HIS, HER OR ITS BROKER, DEALER, COMMERCIAL BANK,
TRUST COMPANY OR OTHER NOMINEE TO THE DEPOSITARY AT ITS ADDRESS SET FORTH
BELOW:
THE DEPOSITARY FOR THE OFFER IS:
CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
<TABLE>
<S> <C> <C>
BY MAIL: BY HAND: BY OVERNIGHT DELIVERY:
Reorganization Reorganization Reorganization
Department Department Department
PO Box 3301 120 Broadway 85 Challenger Road
South Hackensack, NJ
07606 13th Floor Mail Stop--Reorg
Ridgefield Park, NJ
New York, NY 10271 07660
</TABLE>
BY FAX TRANSMISSION
(FOR ELIGIBLE INSTITUTIONS ONLY):
(201) 296-4293
FOR FAX CONFIRMATION ONLY:
(201) 296-4860
Questions and requests for assistance may be directed to the Information Agent
or the Dealer Manager at their respective addresses and telephone numbers set
forth below. Additional copies of the Offer to Purchase, this Letter of
Transmittal and other tender offer materials may be obtained from the
Information Agent or the Dealer Manager as set forth below, and will be
furnished promptly at the Purchaser's expense. You may also contact your
broker, dealer, commercial bank, trust company or other nominee for assistance
concerning the Offer.
THE INFORMATION AGENT FOR THE OFFER IS:
D.F. KING & CO., INC.
77 Water Street
New York, New York 10005
Banks and Brokers Call Collect: (212) 269-5550
All Others Call Toll Free: (800) 290-6424
THE DEALER MANAGER FOR THE OFFER IS:
MORGAN STANLEY DEAN WITTER
1585 Broadway
New York, NY 10036
(650) 234-5757
<PAGE>
LETTER OF TRANSMITTAL
to
Tender Shares of Common Stock
(Including the Associated Preferred Stock Purchase Rights)
of
DAMES & MOORE GROUP
Pursuant to the Offer to Purchase dated May 11, 1999
by
DEMETER ACQUISITION CORPORATION
a wholly owned subsidiary of
URS CORPORATION
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME,
ON TUESDAY, JUNE 8, 1999, UNLESS THE OFFER IS EXTENDED.
The Depositary for the Offer is:
ChaseMellon Shareholder Services, L.L.C.
<TABLE>
<CAPTION>
By Mail: By Hand: By Overnight Delivery:
<S> <C> <C>
Reorganization Department Reorganization Department Reorganization Department
PO Box 3301 120 Broadway 85 Challenger Road
South Hackensack, NJ 07606 13th Floor Mail Stop-Reorg
New York, NY 10271 Ridgefield Park, NJ 07660
</TABLE>
By Fax Transmission
(for eligible institutions only):
(201) 296-4293
For Fax Confirmation Only:
(201) 296-4860
Delivery of this Letter of Transmittal 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.
You must sign this Letter of Transmittal where indicated below and complete
the Substitute Form W-9 provided below.
THE INSTRUCTIONS SET FORTH IN THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
DESCRIPTION OF SHARES TENDERED
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Name(s) and
Address(es)
of
Registered
Holder(s)
(Please fill
in, if
blank,
exactly as
name(s)
appear(s) on
Share Shares Certificate(s) and Share(s) Tendered
Certificate) (Attach additional list, if necessary)
- ---------------------------------------------------------------
Total Number of
Shares Evidenced Number
Share Certificate by Share of Shares
Number(s)* Certificate(s)* Tendered**
----------------------
----------------------
----------------------
----------------------
----------------------
----------------------
<S> <C> <C> <C>
Total Shares
</TABLE>
- --------------------------------------------------------------------------------
* Need not be completed by stockholders delivering by book-entry
transfer.
** Unless otherwise indicated, it will be assumed that all Shares evidenced
by Share Certificate delivered to the Depository are being tendered
hereby. See Instruction 4.
<PAGE>
This Letter of Transmittal is to be completed by stockholders of Dames &
Moore Group either if certificates evidencing Shares (as defined below) are to
be forwarded herewith or, unless an Agent's Message (as defined in the Offer
to Purchase, dated May 11, 1999 (the "Offer to Purchase")) is utilized, if
delivery of Shares is to be made by book-entry transfer to the Depositary's
account at The Depository Trust Company (the "Book-Entry Transfer Facility")
pursuant to the book-entry transfer procedures described in Section 3 of the
Offer to Purchase. Delivery of documents to the Book-Entry Facility does not
constitute delivery to the Depositary.
Stockholders whose certificates evidencing Shares ("Share Certificates") are
not immediately available or who cannot deliver their Share Certificates and
all other documents required hereby to the Depositary on or prior to the
Expiration Date (as defined in the Offer to Purchase) or who cannot complete
the procedures for delivery by book-entry transfer on a timely basis and who
wish to tender their Shares must do so pursuant to the guaranteed delivery
procedures described in Section 3 of the Offer to Purchase. See Instruction 2.
IF ANY OF YOUR SHARE CERTIFICATES HAS BEEN LOST OR DESTROYED, SEE INSTRUCTION
10.
NOTE: SIGNATURES MUST BE PROVIDED BELOW. PLEASE READ THE ACCOMPANYING
INSTRUCTIONS CAREFULLY.
[_]CHECK HERE IF SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER MADE TO AN
ACCOUNT MAINTAINED BY THE DEPOSITARY WITH THE BOOK-ENTRY TRANSFER FACILITY
AND COMPLETE THE FOLLOWING (ONLY PARTICIPANTS IN THE SYSTEM OF THE BOOK-
ENTRY TRANSFER FACILITY MAY DELIVER SHARES BY BOOK-ENTRY TRANSFER):
Name of Tendering Institution: _____________________________________________
Account Number: ____________________________________________________________
Transaction Code Number: ___________________________________________________
[_]CHECK HERE IF SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED
DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING.
PLEASE ENCLOSE A PHOTOCOPY OF SUCH NOTICE OF GUARANTEED DELIVERY.
Name(s) of Registered Holder(s): ___________________________________________
Window Ticket Number (if any): _____________________________________________
Date of Execution of Notice of Guaranteed Delivery: ________________________
Name of Institution which Guaranteed Delivery: _____________________________
If Delivery by Book-Entry Transfer Facility, please check this box: [_]
Account Number: ____________________________________________________________
Transaction Code Number: ___________________________________________________
2
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Demeter Acquisition Corporation, a
Delaware corporation (the "Purchaser") and a wholly owned subsidiary of URS
Corporation, a Delaware corporation, the above-described shares of common
stock, par value $0.01 per share (including the associated preferred stock
purchase rights, the "Shares"), of Dames & Moore Group, a Delaware corporation
(the "Company"), pursuant to the Purchaser's offer to purchase all outstanding
Shares at a price of $16.00 per Share, net to the seller in cash (subject to
applicable withholding of taxes), without interest, upon the terms and subject
to the conditions set forth in the Offer to Purchase, receipt of which is
hereby acknowledged, and in this Letter of Transmittal (which, together with
the Offer to Purchase and any amendments or supplements hereto or thereto,
collectively constitute the "Offer"). The undersigned understands that the
Purchaser reserves the right to transfer or assign, in whole or from time to
time in part, to any direct or indirect wholly owned subsidiary of Parent, the
right to purchase all or any portion of the Shares tendered pursuant to the
Offer.
Subject to, and effective upon, acceptance for payment of, and payment for,
the Shares tendered herewith in accordance with the terms of the Offer
(including, if the Offer is extended or amended, the terms and conditions of
any such extension or amendment), the undersigned hereby sells, assigns and
transfers to, or upon the order of, the Purchaser all right, title and
interest in and to all the Shares that are being tendered hereby and all
dividends, distributions (including, without limitation, distributions of
additional Shares) and rights declared, paid or distributed in respect of such
Shares on or after May 11, 1999 (collectively, "Distributions") and
irrevocably appoints the Depositary the true and lawful agent and attorney-in-
fact of the undersigned with respect to such Shares and all Distributions,
with full power of substitution (such power of attorney being deemed to be an
irrevocable power coupled with an interest), to (i) deliver Share Certificates
evidencing such Shares and all Distributions, or transfer ownership of such
Shares and all Distributions on the account books maintained by the Book-Entry
Transfer Facility, together, in either case, with all accompanying evidences
of transfer and authenticity, to or upon the order of the Purchaser, (ii)
present such Shares and all Distributions for transfer on the books of the
Company and (iii) receive all benefits and otherwise exercise all rights of
beneficial ownership of such Shares and all Distributions, all in accordance
with the terms of the Offer.
The undersigned hereby irrevocably appoints Kent P. Ainsworth and Joseph
Masters, and each of them, as the attorneys-in-fact and proxies 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 (by written consent or otherwise) with respect
to all the Shares tendered hereby which have been accepted for payment by the
Purchaser prior to the time of such vote or other action and all Shares, and
other securities issued in Distributions in respect of such Shares, which the
undersigned is entitled to vote at any meeting of stockholders of the Company
(whether annual or special and whether or not an adjourned or postponed
meeting) or by written consent in lieu of any such meeting or otherwise. This
proxy and power of attorney is coupled with an interest in the Shares tendered
hereby, is irrevocable and is granted in consideration of, and is effective
upon, the acceptance for payment of such Shares by the Purchaser in accordance
with the terms of the Offer. Such acceptance for payment shall revoke, without
further action, all other proxies and powers of attorney granted by the
undersigned at any time with respect to such Shares (and all Shares and other
securities issued in Distributions in respect of such Shares), and no
subsequent proxy or power of attorney shall be given or written consent
executed (and if given or executed, shall not be effective) by the undersigned
with respect thereto. The undersigned understands that, in order for Shares to
be deemed validly tendered, immediately upon the Purchaser's acceptance for
payment of such Shares, the Purchaser or its designees must be able to
exercise full voting and other rights with respect to such Shares and all
Distributions, including, without limitation, voting at any meeting of the
Company's stockholders.
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 all Distributions, and that when and to the extent such Shares are
accepted for payment by the Purchaser, the Purchaser will acquire good,
marketable and unencumbered title thereto and to all Distributions, free and
clear of all liens, restrictions, charges, encumbrances, conditional sales
agreements or other obligations relating to the sale or transfer thereof, and
that none of such Shares and Distributions will be subject to any adverse
claims. The undersigned, upon request, shall execute and deliver all
additional documents deemed by the Depositary or the Purchaser to be necessary
or desirable to complete the sale, assignment and transfer of the Shares
tendered hereby and all Distributions. In addition, the undersigned shall
remit and transfer promptly to the Depositary for the account of the Purchaser
all Distributions in respect of the Shares tendered hereby, accompanied by
appropriate documentation of transfer,
3
<PAGE>
and, pending such remittance and transfer or appropriate assurance thereof,
the Purchaser shall be entitled to all rights and privileges as owner of each
such Distribution and may withhold the entire purchase price of the Shares
tendered hereby, or deduct from such purchase price, the amount or value of
such Distribution as determined by the Purchaser in its sole discretion.
No authority herein conferred or agreed to be conferred shall be affected
by, and all such authority shall survive, the death or incapacity of the
undersigned. All obligations of the undersigned hereunder shall be binding
upon the heirs, executors, administrators, legal representatives, successors
and assigns of the undersigned. Except as stated in the Offer to Purchase,
this tender is irrevocable, provided that the Shares tendered pursuant to the
Offer may be withdrawn at any time on or prior to the Expiration Date and,
unless theretofore accepted for payment as provided in the Offer to Purchase,
may also be withdrawn at any time after July 9, 1999.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described in Section 3 of the Offer to Purchase and in the
instructions hereto and the Purchaser's acceptance for payment of such Shares
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 in the box entitled "Special Payment
Instructions," please issue the check for the purchase price of all Shares
purchased, and return all Share Certificates evidencing Shares not purchased
or not tendered, in the name(s) of the registered holder(s) appearing above
under "Description of Shares Tendered." Similarly, unless otherwise indicated
in the box entitled "Special Delivery Instructions," please mail the check for
the purchase price of all Shares purchased and all Share Certificates
evidencing Shares not tendered or not purchased (and accompanying documents,
as appropriate) to the address(es) of the registered holder(s) appearing above
under "Description of Shares Tendered." In the event that the boxes entitled
"Special Payment Instructions" and "Special Delivery Instructions" are both
completed, please issue the check for the purchase price of all Shares
purchased, and return all Share Certificates evidencing Shares not purchased
or not tendered, in the name(s) of, and mail such check and Share Certificates
to, the person(s) so indicated. Stockholders tendering Shares by book-entry
transfer may request that any Shares not accepted for payment be returned by
crediting the account maintained at the Book-Entry Transfer Facility by making
an appropriate entry under "Special Payment Instructions." The undersigned
recognizes that the Purchaser has no obligation pursuant to the "Special
Payment Instructions" to transfer any Shares from the name of the registered
holder(s) thereof if the Purchaser does not purchase any of such Shares.
4
<PAGE>
PLEASE COMPLETE SUBSTITUTE FORM W-9 ON PAGE 11.
SIGN HERE: _________________________________________________________
____________________________________________________________________________
Signature(s) of Owner(s)
Dated: _______________________________
(Must be signed by registered holder(s) exactly as name(s) appear(s) on the
Share Certificate(s) or on a security position listing or by person(s)
authorized to become registered holder(s) by Share Certificates and
documents transmitted herewith. If signature is by trustees, executors,
administrators, guardians, attorneys-in-fact, officers of a corporation or
others acting in a fiduciary or representative capacity, please provide the
necessary information. See Instruction 5.)
Name(s): ___________________________________________________________________
______________________________________________________________________
(Please Print)
Capacity (full title): _____________________________________________________
Address: ___________________________________________________________________
----------------------------------------------------------------------
(Include Zip Code)
Area Code and
Telephone Number: __________________________________________________________
Tax Identification or
Social Security No.: _______________________________________________________
(See Substitute W-9 on page 11)
GUARANTEE OF SIGNATURE(S)
(If Required--See Instructions 1 and 5)
Authorized Signature: __________________________________________________
Name: ______________________________________________________________________
Name of Firm: ______________________________________________________________
Address: ___________________________________________________________________
----------------------------------------------------------------------
(Include Zip Code)
Title: _____________________________________________________________________
Area Code and Telephone Number: ____________________________________________
Dated: _____________________________________________________________________
5
<PAGE>
SPECIAL PAYMENT INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(See Instructions 1, 5, 6 and 7) (See Instructions 1, 5, 6 and 7)
To be completed ONLY if Share To be completed ONLY if Share
Certificates not tendered or not Certificates not tendered or not
purchased and/or the check for purchased and/or the check for
the purchase price of Shares pur- the purchase price of Shares
chased are to be issued in the purchased are to be sent to
name of someone other than the someone other than the
undersigned, or if Shares ten- undersigned or to the undersigned
dered by book-entry transfer at an address other than that
which are not purchased are to be shown on the front cover.
returned by credit to an account
maintained at the Book-Entry
Transfer Facility other than that
designated on the front cover.
Mail check and/or certificates
to:
Issue check and/or certificates Name: ____________________________
to: (Please Print)
Address: _________________________
__________________________________
Name: ____________________________ (Include Zip Code)
(Please Print)
Address: _________________________
__________________________________
(Include Zip Code)
__________________________________ __________________________________
(Taxpayer Identification or (Taxpayer Identification or
Social Security No.) Social Security No.)
(See Substitute Form W-9 on Page
11)
[_]Credit unpurchased Shares
tendered by book-entry
transfer to the Book-Entry
Transfer Facility account set
forth below:
__________________________________
(Account Number)
6
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. Guarantee of Signatures. All signatures on this Letter of Transmittal
must be medallion guaranteed by a firm which is a member of the Securities
Transfer Agents Medallion Program, or by any other "eligible guarantor
institution," as such term is defined in Rule 17Ad-15 under the Securities
Exchange Act of 1934, as amended (each of the foregoing being referred to as
an "Eligible Institution") unless (i) this Letter of Transmittal is signed by
the registered holder(s) (which term, for purposes of this Letter of
Transmittal, shall include any participant in the Book-Entry Transfer Facility
whose name appears on a security position listing as the owner of Shares) of
the Shares tendered hereby and such holder(s) has (have) not completed either
the box entitled "Special Payment Instructions" or the box entitled "Special
Delivery Instructions" on the reverse hereof or (ii) such Shares are tendered
for the account of an Eligible Institution. See Instruction 5.
2. Delivery of Letter of Transmittal and Share Certificates. This Letter of
Transmittal is to be used either if Share Certificates are to be forwarded
herewith or, unless an Agent's Message (as defined in the Offer to Purchase)
is utilized, if Shares are to be delivered by book-entry transfer pursuant to
the procedures set forth in Section 3 of the Offer to Purchase. Share
Certificates evidencing all physically tendered Shares, or a timely
confirmation of a book-entry transfer into the Depositary's account at the
Book-Entry Transfer Facility of all Shares delivered by book-entry transfer,
as well as a properly completed and duly executed Letter of Transmittal (or a
manually signed facsimile hereof), with any required signature guarantees, or
an Agent's Message in the case of a book-entry delivery, and any other
documents required by this Letter of Transmittal, must be received by the
Depositary at its address set forth herein prior to the Expiration Date. If
Share Certificates are forwarded to the Depositary in multiple deliveries, a
properly completed and duly executed Letter of Transmittal must accompany each
such delivery.
Stockholders whose Share Certificates are not immediately available, who
cannot deliver their Share Certificates and all other required documents to
the Depositary prior to the Expiration Date or who cannot complete the
procedure for delivery by book-entry transfer on a timely basis may tender
their Shares pursuant to the guaranteed delivery procedures described in
Section 3 of the Offer to Purchase. Pursuant to such procedures: (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 made available by the Purchaser, must be received by the Depositary
prior to the Expiration Date; and (iii) the Share Certificates evidencing all
physically delivered Shares in proper form for transfer, or a timely
confirmation of a book-entry transfer into the Depositary's account at the
Book-Entry Transfer Facility of all Shares delivered by book-entry transfer,
in each case together with a Letter of Transmittal (or a manually signed
facsimile hereof), properly completed and duly executed, with any required
signature guarantees (or, in the case of a book-entry delivery, an Agent's
Message), and any other documents required by this Letter of Transmittal, must
be received by the Depositary within three New York Stock Exchange, Inc.
trading days after the date of execution of such Notice of Guaranteed
Delivery, all as described in Section 3 of the Offer to Purchase.
The Notice of Guaranteed Delivery may be delivered by hand or transmitted by
facsimile transmission or mailed to the Depositary and must include a
guarantee by an Eligible Institution on the form set forth in such notice.
The method of delivery of Share Certificates, this Letter of Transmittal and
all other required documents, including delivery through the Book-Entry
Transfer Facility, is at the option and sole risk of the tendering
stockholder, and the delivery will be deemed made only when actually received
by the Depositary (including in the case of a book-entry transfer, by a timely
confirmation). 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. By execution of this Letter of
Transmittal (or a manually signed facsimile hereof), all tendering
stockholders waive any right to receive any notice of the acceptance of their
Shares for payment.
3. Inadequate Space. If the space provided herein under "Description of
Shares Tendered" is inadequate, the Share Certificate numbers, the number of
Shares evidenced by such Share Certificates and the number of Shares tendered
should be listed on a separate schedule and attached hereto and separately
signed on each page thereof in the same manner as this Letter of Transmittal.
7
<PAGE>
4. Partial Tenders (Not Applicable to Stockholders Who Tender by Book-Entry
Transfer). If fewer than all the Shares evidenced by any Share Certificate
delivered to the Depositary herewith are to be tendered, fill in the number of
Shares that is to be tendered in the box entitled "Number of Shares Tendered."
In such cases, new Share Certificate(s) evidencing the remainder of the Shares
that were evidenced by the Share Certificate(s) delivered to the Depositary
herewith will be sent to the person(s) signing this Letter of Transmittal,
unless otherwise provided in the box entitled "Special Delivery Instructions"
on this Letter of Transmittal, as soon as practicable after the Expiration
Date. All Shares evidenced by Share 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 with the name(s) as written
on the face of the Share Certificates evidencing such Shares without
alteration, enlargement or any other change whatsoever.
If any Share tendered hereby is owned of record by two or more persons, all
such persons must sign this Letter of Transmittal.
If any of the Shares tendered hereby are registered in the names of
different holders, it will be necessary to complete, sign and submit as many
separate Letters of Transmittal as there are different registrations of such
Shares.
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares tendered hereby, no endorsements of Share Certificates or separate
stock powers are required, unless payment is to be made to, or Share
Certificates evidencing Shares not tendered or not purchased are to be issued
in the name of, a person other than the registered holder(s), in which case
the Share Certificate(s) evidencing the Shares tendered hereby must be
endorsed or accompanied by appropriate stock powers, in either case signed
exactly as the name(s) of the registered holder(s) appear(s) on such Share
Certificate(s). Signatures on such Share Certificate(s) and stock powers must
be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares tendered hereby, the Share Certificate(s)
evidencing the Shares tendered hereby must be endorsed or accompanied by
appropriate stock powers, in either case signed exactly as the name(s) of the
registered holder(s) appear(s) on such Share Certificate(s). Signatures on
such Share Certificate(s) and stock powers must be guaranteed by an Eligible
Institution.
If this Letter of Transmittal or any Share Certificate or stock power is
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 the Purchaser of such person's authority so to
act must be submitted.
6. Stock Transfer Taxes. Except as otherwise provided in this Instruction 6,
the Purchaser will pay or cause to be paid all stock transfer or other similar
taxes with respect to the sale and transfer of any Shares to it or its order
pursuant to the Offer. If, however, payment of the purchase price of any
Shares is to be made to, or Share Certificate(s) evidencing Shares not
tendered or not purchased are to be issued in the name of, a person other than
the registered holder(s), or if tendered Shares are registered in the name of
any person other than the registered holder(s), or if tendered Share
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(s), such other person or otherwise)
payable on account of the transfer to such other person will be deducted from
the purchase price of such Shares purchased, unless evidence satisfactory to
the Purchaser 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 Share Certificates evidencing the
Shares tendered hereby.
7. Special Payment and Delivery Instructions. If a check for the purchase
price of any Shares tendered hereby is to be issued, or Share Certificate(s)
evidencing Shares not tendered or not purchased are to be issued, in the name
of a person other than the person(s) signing this Letter of Transmittal or if
such check or any such Share Certificate(s) is to be sent to someone other
than the person(s) signing this Letter of Transmittal or to the person(s)
signing this Letter of Transmittal but at an address other than that shown in
the box entitled "Description of Shares Tendered," the appropriate boxes on
this Letter of Transmittal must be completed. Stockholders delivering Shares
tendered hereby by book-entry transfer may request that Shares not purchased
be credited to such account maintained at the Book-Entry Transfer Facility as
such stockholder
8
<PAGE>
may designate in the box entitled "Special Payment Instructions." If no such
instructions are given, all such Shares not purchased will be returned by
crediting the account at the Book-Entry Transfer Facility as the account from
which such Shares were delivered.
8. Questions and Requests for Assistance or Additional Copies. Questions and
requests for assistance may be directed to the Information Agent or the Dealer
Manager at their respective addresses or telephone numbers set forth below.
Additional copies of the Offer to Purchase, this Letter of Transmittal and the
Notice of Guaranteed Delivery may be obtained from the Information Agent or
the Dealer Manager or from brokers, dealers, commercial banks or trust
companies.
9. Substitute Form W-9. Each tendering stockholder is required to provide
the Depositary with a correct Taxpayer Identification Number ("TIN") on the
Substitute Form W-9 which is provided under "Important Tax Information" below,
and to certify whether such stockholder is subject to backup withholding of
federal income tax. If a tendering stockholder has been notified by the
Internal Revenue Service that such stockholder is subject to backup
withholding, such stockholder must cross out item (2) of the Certification box
of the Substitute Form W-9, unless such stockholder has since been notified by
the Internal Revenue Service that such stockholder is no longer subject to
backup withholding. 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 of all Shares purchased from
such stockholder. If the tendering stockholder has not been issued a TIN and
has applied for one or intends to apply for one in the near future, such
stockholder should write "Applied For" in the space provided for the TIN in
Part 1 of the Substitute Form W-9, check the box in Part 3 of the Substitute
Form W-9 and sign and date the Substitute Form W-9. If "Applied For" is
written in Part 1 and/or the box in Part 3 of the Substitute Form W-9 is
checked and the Depositary is not provided with a TIN within 60 days, the
Depositary will withhold 31% on all payments of the purchase price to such
stockholder until a TIN is provided to the Depositary.
10. Lost, Destroyed or Stolen Certificates. If any Share Certificate has
been lost, destroyed or stolen, the stockholder should promptly call the
customer service department at ChaseMellon Shareholder Services, L.L.C. (the
Company's transfer agent), at (800) 777-3674. The stockholder will then be
instructed as to the steps that must be taken in order to replace the Share
Certificate. 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 hereof), properly
completed and duly executed (together with any required signature guarantees),
or an agent's message in the case of book-entry delivery, together with Share
certificates or confirmation of book-entry transfer and all other required
documents, must be received by the depositary on or prior to the Expiration
Date.
9
<PAGE>
IMPORTANT TAX INFORMATION
Under the federal income tax laws, a stockholder whose tendered Shares are
accepted for payment is required by law 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 such stockholder's social security number. If the
Depositary is not provided with the correct TIN, the Internal Revenue Service
may subject the stockholder to a $50 penalty. In addition, payments that are
made to such stockholder with respect to Shares purchased pursuant to the
Offer may be subject to backup withholding.
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 backup withholding results in an
overpayment of taxes, a refund may be obtained from the Internal Revenue
Service.
Certain stockholders (including, among others, all corporations and certain
foreign individuals) are exempt recipients not subject to these backup
withholding and reporting requirements. In order for a foreign individual to
qualify as an exempt recipient, such individual must submit an Internal
Revenue Form W-8, signed under penalties of perjury, attesting to such
individual's exempt status. A Form W-8 may be obtained from the Depositary.
See the enclosed "Guidelines for Certification of Taxpayer Identification
Number on Substitute Form W-9" for additional instructions.
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, a tendering
stockholder is required to notify the Depositary of such stockholder's correct
TIN by completing the form below certifying that the TIN provided on
Substitute Form W-9 is correct (or that such stockholder is awaiting a TIN)
and that (i) such stockholder has not been notified by the Internal Revenue
Service that he or she is subject to backup withholding as a result of a
failure to report all interest or dividends or (ii) the Internal Revenue
Service has notified such stockholder that such stockholder is no longer
subject to backup withholding.
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 holder of the Shares
tendered hereby. 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 guidance
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 1, check the box in Part 3 of the Substitute Form W-9 and sign
and date the Substitute Form W-9. If "Applied For" is written in Part 1 and/or
the box in Part 3 of the Substitute Form W-9 is checked, the Depositary will
reserve 31% of all payments of the purchase price to such stockholder until a
TIN is provided to the Depositary. If the Depositary is not provided with a
TIN within 60 days, the Depositary will withhold 31% of all payments of the
purchase price to such stockholder.
10
<PAGE>
TO BE COMPLETED BY ALL TENDERING STOCKHOLDERS
(SEE INSTRUCTION 9)
PAYER'S NAME: CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
Part 1-PLEASE PROVIDE YOUR Part 3-Social
TIN IN THE BOX AT THE Security Number of
RIGHT AND CERTIFY BY Employer
SIGNING AND DATING BELOW. Identification Number
SUBSTITUTE
Form W-9
Department of
the Treasury ----------------------
Internal Awaiting TIN [_]
Revenue --------------------------------------------------------
Service
PART 2-Certification--Under penalties of perjury, I
certify that:
Payer's Request
for Taxpayer
Identification (1) The number shown on this form is my correct
Number (TIN) Taxpayer Identification Number (or I am waiting
for a number to be issued to me); and
. ^
(2) I am not subject to backup withholding either
because (i) I am exempt from backup withholding,
(ii) I have not been notified by the Internal
Revenue Service (the "IRS") that I am subject to
backup withholding as a result of a failure to
report all interest or dividends, or (iii) the
IRS has notified me that I am no longer subject
to backup withholding.
CERTIFICATION INSTRUCTIONS--You must cross out Item
(2) in Part 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 were no longer subject to backup withholding, do
not cross out item (2).
--------------------------------------------------------
SIGNATURE: _____________________ DATE: ____________
NOTE: Failure to complete and return this Substitute Form W-9 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.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED
THE BOX IN PART 3 OF SUBSTITUTE FORM W-9.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification
number has not been issued to me, and either (1) I have mailed or
delivered an application to receive a taxpayer identification number to
the appropriate IRS Center or Social Security Administration Office or
(2) I intend to mail or deliver an application in the near future. I
understand that if I do not provide a taxpayer identification number by
the time of payment, 31% of all reportable payments made to me will be
withheld, but that such amounts will be refunded to me if I then provide
a taxpayer identification number within sixty (60) days.
SIGNATURE ____________________________________ DATE: ____________________
11
<PAGE>
FACSIMILE COPIES OF THIS LETTER OF TRANSMITTAL, PROPERLY COMPLETED AND DULY
EXECUTED, WILL BE ACCEPTED. THIS LETTER OF TRANSMITTAL, SHARE CERTIFICATES AND
ANY OTHER REQUIRED DOCUMENTS SHOULD BE SENT OR DELIVERED BY EACH TENDERING
STOCKHOLDER OF THE COMPANY OR HIS, HER OR ITS BROKER, DEALER, COMMERCIAL BANK,
TRUST COMPANY OR OTHER NOMINEE TO THE DEPOSITARY AT ITS ADDRESS SET FORTH
BELOW:
The Depositary for the Offer is:
ChaseMellon Shareholder Services, L.L.C.
<TABLE>
<S> <C> <C>
By Mail: By Hand: By Overnight Delivery:
Reorganization Department Reorganization Department Reorganization Department
PO Box 3301 120 Broadway 85 Challenger Road
South Hackensack, NJ 07606 13th Floor Mail Stop--Reorg
New York, NY 10271 Ridgefield Park, NJ 07660
</TABLE>
By Fax Transmission
(for Eligible Institutions only):
(201) 296-4293
For Fax Confirmation Only:
(201) 296-4860
Questions and requests for assistance may be directed to the Information Agent
or the Dealer Manager at their respective addresses and telephone numbers set
forth below. Additional copies of the Offer to Purchase, this Letter of
Transmittal and other tender offer materials may be obtained from the
Information Agent or the Dealer Manager as set forth below, and will be
furnished promptly at the Purchaser's expense. You may also contact your
broker, dealer, commercial bank, trust company or other nominee for assistance
concerning the Offer.
The Information Agent for the Offer is:
D.F. King & Co., Inc.
77 Water Street
New York, New York 10005
Banks and Brokers Call Collect: (212) 269-5550
All Others Call Toll Free: (800) 290-6424
The Dealer Manager for the Offer is:
MORGAN STANLEY DEAN WITTER
1585 Broadway
New York, NY 10036
(650) 234-5757
12
<PAGE>
NOTICE OF GUARANTEED DELIVERY
for
Tender of Shares of Common Stock
(Including the Associated Preferred Stock Purchase Rights)
of
DAMES & MOORE GROUP
to
DEMETER ACQUISITION CORPORATION
a wholly owned subsidiary of
URS CORPORATION
(Not to be used for signature guarantees)
This Notice of Guaranteed Delivery, or one substantially in the form hereof,
must be used to accept the Offer (as defined below) (i) if certificates
("Share Certificates") evidencing shares of common stock, par value $0.01 per
share (including the associated preferred stock purchase rights, the
"Shares"), of Dames & Moore Group, a Delaware corporation (the "Company"), are
not immediately available, (ii) if Share Certificates and all other required
documents cannot be delivered to ChaseMellon Shareholder Services, L.L.C., as
Depositary (the "Depositary"), on or prior to the Expiration Date (as defined
in the Offer to Purchase, dated May 11, 1999 (the "Offer to Purchase")) or
(iii) if the procedures for delivery of Shares by book-entry transfer cannot
be completed on a timely basis. This Notice of Guaranteed Delivery may be
delivered by hand or mail or transmitted by telegram or facsimile transmission
to the Depositary and must include a guarantee by an "Eligible Institution"
(as defined in the Offer to Purchase). See Section 3 of the Offer to Purchase.
The Depositary for the Offer is:
ChaseMellon Shareholder Services, L.L.C.
By Mail: By Hand: By Overnight Delivery:
Reorganization Department Reorganization Department Reorganization Department
PO Box 3301 120 Broadway 85 Challenger Road
South Hackensack, NJ 13th Floor Mail Stop--Reorg
07606 New York, NY 10271 Ridgefield Park, NJ 07660
By Fax Transmission
(for Eligible Institutions only):
(201) 296-4293
For Fax Confirmation Only:
(201) 296-4860
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.
<PAGE>
This Notice of Guaranteed Delivery is not to be used to guarantee
signatures. If a signature on a Letter of Transmittal is required to be
guaranteed by an "Eligible Institution" under the instructions thereto, such
signature guarantee must appear in the applicable space provided in the
signature box on the Letter of Transmittal.
The guarantee on the last page must be completed.
Ladies and Gentlemen:
The undersigned hereby tenders to Demeter Acquisition Corporation, a
Delaware corporation and a wholly owned subsidiary of URS Corporation, a
Delaware corporation, upon the terms and subject to the conditions set
forth in the Offer to Purchase and the related Letter of Transmittal,
receipt of each of which is hereby acknowledged, the number of Shares
specified below pursuant to the guaranteed delivery procedures described
in Section 3 of the Offer to Purchase.
Number of Shares: _________________________________________________________
Share Certificate Number(s) (if available): _______________________________
If Share(s) will be delivered by book-entry transfer, check this box. [_]
Account Number: ___________________________________________________________
Name(s) of Record Holder(s): ______________________________________________
___________________________________________________________________________
(Please Type or Print)
Address(es): ______________________________________________________________
___________________________________________________________________________
(Zip Code)
Area Code and Telephone Number(s): ________________________________________
___________________________________________________________________________
Signature(s) ______________________________________________________________
Dated: ____________, 1999
2
<PAGE>
THE GUARANTEE BELOW MUST BE COMPLETED
GUARANTEE
The undersigned, a financial institution which is a member of the
Securities Transfer Agents Medallion Program or an "eligible guarantor
institution," as such term is defined in Rule 17Ad-15 under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), hereby (a)
represents that the tender of Shares effected hereby complies with Rule
14e-4 under the Exchange Act and (b) guarantees to deliver to the
Depositary, at its address set forth above, Share Certificates evidencing
the Shares tendered hereby, in proper form for transfer, or a timely
confirmation of book-entry transfer of such Shares into the Depositary's
account at The Depositary Trust Company, in each case with delivery of a
Letter of Transmittal (or a manually signed facsimile thereof), properly
completed and duly executed, with any required signature guarantees, or,
in the case of a book-entry delivery, an Agent's Message (as defined in
the Offer to Purchase), and any other required documents, all within three
New York Stock Exchange, Inc. trading days of the date of execution of
this Notice of Guaranteed Delivery.
Name of Firm ______________________________________________________________
___________________________________________________________________________
(Authorized Signature)
Address ___________________________________________________________________
(Zip Code)
Area Code and Telephone Number: ___________________________________________
Name: _____________________________________________________________________
(please print or type)
Title: ____________________________________________________________________
Dated: ____________, 1999
NOTE: DO NOT SEND SHARE CERTIFICATES WITH THIS NOTICE OF GUARANTEED
DELIVERY. SHARE CERTIFICATES SHOULD BE SENT WITH YOUR LETTER OF
TRANSMITTAL.
THIS NOTICE OF GUARANTEED DELIVERY IS NOT TO BE USED FOR SIGNATURE
GUARANTEE.
3
<PAGE>
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, NY 10036
OFFER TO PURCHASE FOR CASH
All Outstanding Shares of Common Stock
(Including the Associated Preferred Stock Purchase Rights)
of
DAMES & MOORE GROUP
at
$16.00 Net Per Share
by
DEMETER ACQUISITION CORPORATION
a wholly owned subsidiary of
URS CORPORATION
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON TUESDAY, JUNE 8, 1999, UNLESS THE OFFER IS EXTENDED.
May 11, 1999
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
We have been appointed by Demeter Acquisition Corporation, a Delaware
corporation (the "Purchaser") and a wholly owned subsidiary of URS
Corporation, a Delaware corporation ("Parent"), to act as Dealer Manager in
connection with the Purchaser's offer to purchase all outstanding shares of
common stock, par value $0.01 per share (together with the associated
preferred stock purchase rights, the "Shares"), of Dames & Moore Group, a
Delaware corporation (the "Company"), at a price of $16.00 per Share, net to
the seller in cash (subject to applicable withholding of taxes), without
interest, upon the terms and subject to the conditions set forth in the
Purchaser's Offer to Purchase, dated May 11, 1999 (the "Offer to Purchase"),
and the related Letter of Transmittal (which, together with any amendments or
supplements thereto, collectively constitute the "Offer") enclosed herewith.
The Offer is made in connection with the Agreement and Plan of Merger, dated
as of May 5, 1999 (the "Merger Agreement"), among Parent, the Purchaser and
the Company.
Please furnish copies of the enclosed materials to those of your clients for
whose accounts you hold Shares registered in your name or in the name of your
nominee.
The Offer is conditioned upon, among other things, there having been validly
tendered and not withdrawn on or prior to the Expiration Date (as hereinafter
defined) at least a majority of the Shares then outstanding on a fully diluted
basis. The Offer is also subject to the satisfaction of customary closing
conditions, including (i) the expiration or termination of any applicable
waiting periods imposed by the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended, and (ii) conditions to the financing commitments obtained by
Parent. See the Introduction and Sections 9 and 14 of the Offer to Purchase.
The Board of Directors of the Company has approved and found advisable the
Merger Agreement and the transactions contemplated thereby, including the
Offer and the Merger (as defined in the Offer to Purchase), and determined
that the terms of the Offer and the Merger are fair to, and in the best
interests of, the stockholders of the Company and recommends that stockholders
accept the Offer and tender all their Shares pursuant to the Offer.
Enclosed for your information and forwarding to your clients are copies of
the following documents:
1. Offer to Purchase, dated May 11, 1999;
2. Letter of Transmittal to be used by holders of Shares in accepting
the Offer and tendering Shares. Facsimile copies of the Letter of
Transmittal may be used to tender Shares;
<PAGE>
3. Notice of Guaranteed Delivery to be used to accept the Offer if
certificates evidencing Shares ("Share Certificates") and all other
required documents are not immediately available or cannot be
delivered to ChaseMellon Shareholder Services, L.L.C. (the
"Depositary") by the Expiration Date or if, in the case of book-entry
delivery of Shares, the procedures for book-entry transfer set forth
in Section 3 of the Offer to Purchase cannot be completed by the
Expiration Date;
4. Letter to Stockholders of the Company from Arthur C. Darrow,
Chairman, Chief Executive Officer and President of the Company,
accompanied by the Company's Solicitation/Recommendation Statement on
Schedule 14D-9 filed with the Securities and Exchange Commission by
the Company;
5. A letter that may be sent to your clients for whose accounts you hold
Shares registered in your name or in the name of your nominee, with
space provided for obtaining such client's instructions with regard
to the Offer; and
6. Guidelines of the Internal Revenue Service for Certification of
Taxpayer Identification Number on Substitute Form W-9.
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS
PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER AND WITHDRAWAL RIGHTS EXPIRE
AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON TUESDAY, JUNE 8, 1999, UNLESS THE
OFFER IS EXTENDED (THE "EXPIRATION DATE").
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) Share
Certificates (or, in the case of book-entry delivery of Shares, a timely
confirmation of a book-entry transfer of such Shares into the Depositary's
account at The Depositary Trust Company), (ii) the Letter of Transmittal (or a
manually signed facsimile thereof), properly completed and duly executed, with
any required signature guarantees, or an Agent's Message (as defined in the
Offer to Purchase) in connection with a book-entry delivery of Shares and
(iii) and any other documents required by the Letter of Transmittal.
If holders of Shares wish to tender Shares, but cannot deliver their Share
Certificates or other required documents, or cannot comply with the procedures
for book-entry transfer, on or prior to the Expiration Date, a tender may be
effected by following the guaranteed delivery procedures described in Section
3 of the Offer to Purchase.
Neither the Purchaser nor Parent will pay any fees or commissions to any
broker, dealer or other person (other than the Dealer Manager, 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, the Purchaser will, upon request, reimburse you for customary mailing
and handling expenses incurred by you in forwarding any of the enclosed
materials to your clients. The Purchaser will pay or cause to be paid any
stock transfer or other similar taxes payable with respect to the transfer of
Shares to it, except as otherwise provided in Instruction 6 of the Letter of
Transmittal.
Any inquiries you may have with respect to the Offer should be addressed to,
and additional copies of the enclosed materials may be obtained by contacting,
Morgan Stanley & Co. Incorporated, the Dealer Manager, or D.F. King & Co.,
Inc., the Information Agent, at their respective addresses and telephone
numbers set forth on the back cover of the Offer to Purchase.
Very truly yours,
MORGAN STANLEY DEAN WITTER
Nothing contained herein or in the enclosed documents shall authorize you or
any other person to act on behalf of or as the agent of Parent, the Purchaser,
the Company, the Dealer Manager, the Information Agent or the Depositary, or
of any affiliate of any of them, or authorize you or any other person to use
any document or to make any statement on behalf of any of them in connection
with the Offer other than the enclosed documents and the statements contained
therein.
2
<PAGE>
OFFER TO PURCHASE FOR CASH
All Outstanding Shares of Common Stock
(Including the Associated Preferred Stock Purchase Rights)
of
DAMES & MOORE GROUP
at
$16.00 Net Per Share
by
DEMETER ACQUISITION CORPORATION
a wholly owned subsidiary of
URS CORPORATION
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON TUESDAY, JUNE 8, 1999, UNLESS THE OFFER IS EXTENDED.
May 11, 1999
To Our Clients:
Enclosed for your consideration are an Offer to Purchase, dated May 11, 1999
(the "Offer to Purchase"), and a related Letter of Transmittal (which,
together with any amendments or supplements thereto, collectively constitute
the "Offer") in connection with the offer by Demeter Acquisition Corporation,
a Delaware corporation (the "Purchaser") and a wholly owned subsidiary of URS
Corporation, a Delaware corporation ("Parent"), to purchase all outstanding
shares of common stock, par value $0.01 per share (together with the
associated preferred stock purchase rights, the "Shares"), of Dames & Moore
Group, a Delaware corporation (the "Company"), at a price of $16.00 per Share,
net to the seller in cash (subject to applicable withholding of taxes),
without interest, upon the terms and subject to the conditions set forth in
the Offer. The Offer is made in connection with the Agreement and Plan of
Merger, dated as of May 5, 1999 (the "Merger Agreement"), among Parent, the
Purchaser and the Company. Holders of Shares whose certificates evidencing
such Shares (the "Share Certificates") are not immediately available or who
cannot deliver their Share Certificates and all other required documents to
the Depositary (as hereinafter defined) on or prior to the Expiration Date (as
hereinafter defined), or who cannot complete the procedures for book-entry
transfer on a timely basis, must tender their Shares according to the
guaranteed delivery procedures set forth in Section 3 of the Offer to
Purchase.
We are (or our nominee is) the holder of record of Shares held by us for
your account. A tender of such Shares can be made only by us as the holder of
record and pursuant to your instructions. The Letter of Transmittal is
furnished to you for your information only and cannot be used by you to tender
Shares held by us for your account.
Accordingly, we request instructions as to whether you wish to have us
tender on your behalf any or all of the Shares held by us for your account
upon the terms and subject to the conditions set forth in the Offer.
Please note the following:
1. The tender price is $16.00 per Share, net to the seller in cash
(subject to applicable withholding of taxes), without interest, upon the
terms and subject to the terms and conditions set forth in the Offer.
2. The Offer is being made for all outstanding Shares.
<PAGE>
3. The Offer is being made pursuant to the Agreement and Plan of Merger,
dated as of May 5, 1999 (the "Merger Agreement"), among Parent, the
Purchaser and the Company pursuant to which, following the consummation of
the Offer and the satisfaction or waiver of certain conditions, the
Purchaser will be merged with and into the Company, with the Company
surviving the merger as a wholly owned subsidiary of Parent (the "Merger").
In the Merger, each outstanding Share (other than Shares owned by the
Company as treasury stock or by Parent, Purchaser or any other direct or
indirect wholly owned subsidiaries of Parent, or by stockholders, if any,
who are entitled to and who properly exercise dissenters' rights under
Delaware law) will be converted into the right to receive $16.00 per Share,
net to the seller in cash, without interest, as set forth in the Merger
Agreement and described in the Offer to Purchase.
4. The Board of Directors of the Company has approved and found
advisable the Merger Agreement and the transactions contemplated thereby,
including the Offer and the Merger (as defined in the Offer to Purchase),
and determined that the terms of the Offer and the Merger are fair to, and
in the best interests of, the stockholders of the Company and recommends
that stockholders of the Company accept the Offer and tender all their
Shares pursuant to the Offer.
5. The Offer and withdrawal rights will expire at 12:00 Midnight, New
York City time, on Tuesday, June 8, 1999, unless the Offer is extended (the
"Expiration Date").
6. The Offer is conditioned upon, among other things, there having been
validly tendered and not withdrawn on or prior to the Expiration Date at
least a majority of the Shares then outstanding on a fully diluted basis.
The Offer is also subject to customary closing conditions, including (i)
the expiration or termination of any applicable waiting periods imposed by
the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and
(ii) conditions to the financing commitments obtained by Parent. See the
Introduction and Sections 9 and 14 of the Offer to Purchase.
7. Tendering stockholders will not be obligated to pay brokerage fees or
commissions or, except as otherwise provided in Instruction 6 of the Letter
of Transmittal, stock transfer or other similar taxes with respect to the
purchase of Shares by the Purchaser pursuant to the Offer.
8. Payment for Shares purchased pursuant to the Offer will in all cases
be made only after timely receipt by ChaseMellon Shareholder Services,
L.L.C. (the "Depositary") of (a) Share Certificates or, in the case of
book-entry delivery of Shares, timely confirmation of the book-entry
transfer of such Shares into the Depositary's account at The Depositary
Trust Company pursuant to the procedures set forth in Section 3 of the
Offer to Purchase, (b) the Letter of Transmittal (or a manually signed
facsimile thereof), properly completed and duly executed, with any required
signature guarantees, or an Agent's Message (as defined in the Offer to
Purchase) in connection with a book-entry delivery and (c) any other
documents required by the Letter of Transmittal.
If you wish to have us tender any or all of your Shares, please so instruct
us by completing, executing and returning to us the instruction form contained
in this letter. An envelope in which to return your instructions to us is
enclosed. If you authorize the tender of your Shares, all such Shares will be
tendered unless otherwise specified in your instructions. Your instructions
should be forwarded to us in ample time to permit us to submit a tender on
your behalf prior to the expiration of the Offer.
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 or
acceptance of the Offer would not be in compliance with the laws of such
jurisdiction. In any jurisdiction where the 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 Purchaser by Morgan Stanley & Co.
Incorporated, the Dealer Manager, or one or more registered brokers or dealers
licensed under the laws of such jurisdiction.
2
<PAGE>
Instructions with Respect to the
Offer to Purchase for Cash All Outstanding Shares of Common Stock
of
Dames & Moore Group
by
Demeter Acquisition Corporation
a wholly owned subsidiary of
URS Corporation
The undersigned acknowledge(s) receipt of your letter and the enclosed Offer
to Purchase, dated May 11, 1999 (the "Offer to Purchase"), and the related
Letter of Transmittal in connection with the offer by Demeter Acquisition
Corporation, a Delaware corporation and a wholly owned subsidiary of URS
Corporation, a Delaware corporation, to purchase all outstanding shares of
common stock, par value $0.01 per share (together with the associated
preferred stock purchase rights, the "Shares"), of Dames & Moore Group, a
Delaware corporation, at a price of $16.00 per Share, net to the seller in
cash (subject to applicable withholding of taxes), without interest, upon the
terms and subject to the conditions set forth in the Offer to Purchase and the
related Letter of Transmittal.
This will instruct you to tender the number of Shares indicated below (or,
if no number is indicated below, all Shares) that are held by you for the
account of the undersigned, upon the terms and subject to the conditions set
forth in the Offer.
Dated: , 1999
NUMBER OF SHARES TO BE SIGN HERE
TENDERED: -------------------------------------
Signature(s) of Holder(s)
SHARES*: _____________________
Name(s) of Holder(s):
-------------------------------------
Please Type or Print
-------------------------------------
Address(es)
-------------------------------------
Zip Code(s)
-------------------------------------
Area Code and Telephone Number(s)
-------------------------------------
Taxpayer Identification or Social
Security Number(s)
- --------
* Unless otherwise indicated, it will be assumed that all 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
For this type of account: Social Security
number of--
- ---------------------------------------------
<S> <C>
1. An individual's account The individual
2. Two or more individuals The actual owner
(joint account) of the account
or, if combined
funds, any one
of the
individuals(1)
3. Husband and wife (joint The actual owner
account) of the account
or, if joint
funds, either
person(1)
4.Custodian account of a The minor(2)
minor (Uniform Gift to
Minors Act)
5. Adult and minor (joint The adult or, if
account) the minor is the
only
contributor, the
minor(1)
6. Account in the name of The ward, minor
guardian or committee or incompetent
for a designated ward, person(3)
minor or incompetent
person
7.a. The usual revocable The grantor-
savings trust account trustee(1)
(grantor is also
trustee)
b. So-called trust account The actual
that is not a legal or owner(1)
valid trust under state
law
8. Sole proprietorship The owner(4)
account
- ---------------------------------------------
</TABLE>
<TABLE>
-------
<CAPTION>
Give the Employer
For this type of account: Identification
number of--
-------
<S> <C>
9. A valid trust, estate or The legal entity
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.)(5)
10. Corporate account The corporation
11. Religious, charitable or The organization
educational organization
account
12. Partnership account held The partnership
in the name of the
business
13. Association, club or The organization
other tax-exempt
organization
14. A broker or registered The broker or
nominee nominee
15. Account with the The public
Department of entity
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.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Circle the ward's, minor's, or incompetent person's name and furnish such
person's social security number.
(4) Show the name of the owner.
(5) List first and circle the name of the legal trust, estate or pension
trust.
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>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
Page 2
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 Card, or
Form SS-4, Application for Employer Identification Number, at the local office
of the Social Security Administration or the Internal Revenue Service and
apply for a number.
Payees Exempt from Backup Withholding
Payees specifically exempted from backup withholding on ALL payments 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 subdivision or instrumentality thereof.
. A foreign government, a political subdivision of a foreign government, or
any agency or instrumentality thereof.
. An international organization or any agency, or instrumentality thereof.
. A registered dealer in securities or commodities registered in the United
States 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 nonexempt trust described in
Section 4947(a)(1).
. 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 partner.
. Payments of patronage dividends where the amount received is not paid in
money.
. Payments made by certain foreign organizations.
. Payments made to a nominee.
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 non-resident aliens.
. Payments on tax-free covenant bonds under section 1451.
. Payments made by certain foreign organizations.
. Payments made to a nominee.
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.
Certain payments other than interest, dividends and patronage dividends that
are not subject to information reporting are also not subject to backup with-
holding. For details, see the regulations under sections 6041, 6041A(a), 6042,
6044, 6049, 6045, 6050A and 6050N.
Privacy Act Notice.--Section 6109 requires most recipients of dividend,
interest, or other payments to give taxpayer identification numbers to payers
who must report the payments to the IRS. The IRS uses the numbers for
identification purposes. Payers must be given the numbers whether or not
recipients are required to file tax returns. Payers must generally withhold
31% of taxable interest, dividend, and certain other payments to a payee who
does not furnish a taxpayer identification number to a payer. Certain
penalties may also apply.
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.--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>
This announcement is neither an offer to purchase nor a solicitation of an
offer to sell Shares. The Offer is made solely by the Offer to Purchase, dated
May 11, 1999, and the related Letter of Transmittal (and any amendments or
supplements thereto), 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 the Offer or the
acceptance thereof would not be in compliance with the laws of such
jurisdiction. In any jurisdiction where the securities 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 Morgan Stanley & Co. Incorporated, the
Dealer Manager for the Offer, or by one or more registered brokers or dealers
licensed under the laws of such jurisdiction.
Notice of Offer To Purchase For Cash
All Outstanding Shares Of Common Stock
(Including the Associated Preferred Stock Purchase Rights)
of
Dames & Moore Group
at
$16.00 Net Per Share
by
Demeter Acquisition Corporation
a wholly owned subsidiary of
URS Corporation
Demeter Acquisition Corporation, a Delaware corporation (the "Purchaser") and
a wholly owned subsidiary of URS Corporation, a Delaware corporation
("Parent"), is offering to purchase all the outstanding shares of common stock,
par value $0.01 per share (together with the associated preferred stock
purchase rights, the "Shares"), of Dames & Moore Group, a Delaware corporation
(the "Company"), at a price of $16.00 per Share (the "Offer Price"), net to the
seller in cash, without interest, upon the terms and subject to the conditions
set forth in the Offer to Purchase, dated May 11, 1999 (the "Offer to
Purchase"), and in the related Letter of Transmittal (which, together with any
supplements or amendments thereto, collectively constitute the "Offer").
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON TUESDAY, JUNE 8, 1999, UNLESS THE OFFER IS EXTENDED.
The Offer is being made pursuant to an Agreement and Plan of Merger, dated as
of May 5, 1999 (the "Merger Agreement"), among Parent, the Purchaser and the
Company, pursuant to which, following the consummation of the Offer, the
Purchaser will be merged with and into the Company, with the Company as the
surviving corporation (the "Merger"). On the effective date of the Merger, each
outstanding Share (other than Shares owned by the Company as treasury stock or
by Parent, the Purchaser or any other subsidiary of Parent, or by stockholders,
if any, who are entitled to and who properly exercise dissenters' rights under
Delaware law) will be converted into the right to receive $16.00 in cash,
without interest. The Merger Agreement is more fully described in Section 10 of
the Offer to Purchase.
The Offer is conditioned upon, among other things, there having been validly
tendered and not withdrawn prior to the Expiration Date (as defined below) at
least a majority of the Shares then outstanding on a fully diluted basis (the
"Minimum Condition") and is also subject to customary closing conditions,
including (i) the expiration or termination of any applicable waiting periods
imposed by the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, and (ii) conditions to the financing commitments obtained by Parent.
See the Introduction and Sections 9 and 14 of the Offer to Purchase.
<PAGE>
The Board of Directors of the Company has unanimously approved and found
advisable the Merger Agreement, the Offer and the Merger, determined that the
terms of the Offer and the Merger are fair to, and in the best interests of,
the stockholders of the Company and recommends that stockholders of the
Company accept the Offer and tender all of their Shares pursuant to the Offer.
For purposes of the Offer, the Purchaser shall be deemed to have accepted
for payment, and thereby purchased, Shares validly tendered to the Purchaser
and not properly withdrawn on or prior to the expiration of the Offer as, if
and when the Purchaser gives oral or written notice to the Depositary (as
defined in the Offer to Purchase) of the Purchaser's 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 receiving payment from the
Purchaser and transmitting payments to tendering stockholders whose Shares
have been accepted 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 such Shares or timely confirmation of book-
entry transfer of such Shares into the Depositary's account at the Book-Entry
Transfer Facility (as defined in the Offer to Purchase) pursuant to the
procedures set forth in Section 3 of the Offer to Purchase, (ii) a properly
completed and duly executed Letter of Transmittal (or facsimile thereof) 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. Upon the deposit of funds
with the Depositary for the purpose of making payments to tendering
stockholders, the Purchaser's obligation to make such payment will be
satisfied. Thereafter, tendering stockholders should look solely to the
Depositary for payments of amounts owed to such stockholders by reason of the
acceptance for payment of Shares pursuant to the Offer.
The term "Expiration Date" means 12:00 Midnight, New York City time, on
Tuesday, June 8, 1999 unless and until the Purchaser, in its sole discretion
(but subject to 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 on which the Offer, as
so extended by the Purchaser, shall expire. The Purchaser expressly reserves
the right, in its sole discretion (but subject to the terms of the Merger
Agreement), at any time or from time to time, and regardless of whether or not
any of the events set forth in Section 14 of the Offer to Purchase shall have
occurred, (i) to extend the period of time during which the Offer is open and
thereby delay acceptance for payment of, and the payment for, any Shares, by
giving oral or written notice of such extension to the Depositary and (ii) to
amend the Offer in any other respect by giving oral or written notice of such
amendment to the Depositary. There can be no assurance that the Purchaser will
exercise its right to extend the Offer (other than as may be required by
applicable law). Any such extension will be followed by a public announcement
thereof no later than 9:00 a.m., New York City time, on the next business day
after the previously scheduled Expiration Date in accordance with the public
announcement requirements of Rule 14d-4(c) under the Securities Exchange Act
of 1934, as amended. 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. Under no
circumstances will interest be paid by the Purchaser on the purchase price of
the Shares, regardless of any extension of the Offer or any delay in making
such payment.
Except as otherwise provided below, tenders of Shares are irrevocable.
Shares tendered pursuant to the Offer may be withdrawn at any time prior to
the Expiration Date and, unless theretofore accepted for payment and paid for
by the Purchaser pursuant to the Offer, may also be withdrawn at any time
after July 9, 1999. For a withdrawal to be effective, a written 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 the Offer to Purchase and
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 different from the name of the person
who tendered the Shares. If certificates for 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 by an Eligible Institution, as defined in Section 3 of the Offer
to Purchase, the signature on the notice of withdrawal must be guaranteed by
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<PAGE>
an Eligible Institution. If Shares have been tendered pursuant to the
procedures for book-entry transfer as set forth in Section 3 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
purposes of the Offer. However, withdrawn Shares may be retendered by again
following one of the procedures described in Section 3 of the Offer to
Purchase at any time 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 the Purchaser, in its sole discretion, whose determination will
be final and binding.
The information required to be disclosed by Rule 14d-6(e)(1)(vii) 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 the Purchaser with the Company's stockholder lists
and security position listings for the purpose of disseminating the Offer to
holders of Shares. The Offer to Purchase, the related 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
lists or, if applicable, who are listed as participants in a clearing agency's
security position listing, for subsequent transmittal to beneficial owners of
Shares.
The Offer to Purchase and the related Letter of Transmittal contain
important information that should be read before any decision is made with
respect to the Offer.
Questions and requests for assistance or for copies of the Offer to
Purchase, the related 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 below. Copies of the Offer to Purchase, the related Letter of
Transmittal, the Notice of Guaranteed Delivery or other tender offer materials
will be furnished promptly at the Purchaser's expense. No fees or commissions
will be paid to brokers, dealers or other persons (other than the Dealer
Manager and Information Agent, as described in the Offer to Purchase) for
soliciting tenders of Shares pursuant to the Offer.
The Information Agent for the Offer is:
D.F. King & Co., Inc.
77 Water Street
New York, New York 10005
Banks and Brokers Call Collect: (212) 269-5550
All Others Call Toll Free: (800) 290-6424
The Dealer Manager for the Offer is:
MORGAN STANLEY DEAN WITTER
1585 Broadway
New York, NY 10036
(650) 234-5757
May 11, 1999
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