<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
---------------
WANG LABORATORIES, INC.
(Name of Subject Company)
---------------
GETRONICS NV GETRONICS ACQUISITION, INC.
(Bidders)
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Common Stock, par value $0.01 per share (including the associated rights)
4 1/2% Series A Cumulative Convertible Preferred Stock, par value $0.01 per
share
6 1/2% Series B Cumulative Convertible Preferred Stock, par value $0.01 per
share
Depositary Shares (each representing a 1/20th interest in a share of 6 1/2%
Series B Cumulative Convertible Preferred Stock)
Common Stock Purchase Warrants
Special Common Stock Warrant
(Title of Class of Securities)
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Common Shares: 93369N109 Depositary Shares: 93369N208,
Series A Preferred Shares: N/A 93369N604
Series B Preferred Shares: N/A Purchase Warrants: 93369N117
Special Warrant: N/A
(CUSIP Number of Class of Securities)
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F.A.R.N. Kleipool
Getronics NV
Donauweg 10
1043 AJ Amsterdam
The Netherlands
011-31-20-586-1412
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidders)
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Copy to:
John M. Reiss, Esq.
White & Case LLP
1155 Avenue of the Americas
New York, New York 10036
(212) 819-8200
CALCULATION OF FILING FEE
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<TABLE>
<CAPTION>
Transaction Valuation* Amount of Filing Fee**
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<S> <C>
$1,711,312,175.75 $342,262.44
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</TABLE>
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* Estimated solely for the purpose of determining the registration fee. Based
on the offer to purchase 47,045,593 shares of Common Stock, 90,000 shares of
Series A Preferred Stock, 143,750 shares of Series B Preferred Stock,
7,208,935 Common Stock Purchase Warrants and 1 Special Common Stock Warrant
at a price of (i) $29.25 per share of Common Stock, (ii) $1271.73 per share
of Series A Preferred Stock, (iii) $1,101.17 per share of Series B Preferred
Stock, (iv) $7.80 per Common Stock Purchase Warrant and (v) $6,250,000 for
the Special Common Stock Warrant net to the seller in cash, without interest
thereon.
** The amount of the filing fee, calculated in accordance with Rule 0-11
under the Securities Exchange Act of 1934, as amended, equals 1/50 of one
percent of the aggregate of the cash offered by the bidder.
[_] 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.
Amount Previously Paid: Filing Party:
Form or Registration No.: Date Filed:
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SCHEDULE 14D-1
CUSIP No. Common Stock: 93369N109
Series A Preferred Stock: N/A
Series B Preferred Stock: N/A
Depositary Shares: 93369N208, 93369N604
Common Stock Purchase Warrants: 93369N117
Special Common Stock Warrant: N/A
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1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Getronics NV
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [_]
(b) [_]
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
BK; WC
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5. CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(e) or 2(f) [_]
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
The Netherlands
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7. AGGREGATE AMOUNT BENEFICALLY OWNED
BY EACH REPORTING PERSON
0
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8. CHECK IF THE AGGREGATE AMOUNT IN ROW (7)
EXCLUDES CERTAIN SHARES [_]
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9. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
0.0%
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10. TYPE OF REPORTING PERSON
CO
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2
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SCHEDULE 14D-1
CUSIP No. Common Stock: 93369N109
Series A Preferred Stock: N/A
Series B Preferred Stock: N/A
Depositary Shares: 93369N208, 93369N604
Common Stock Purchase Warrants: 93369N117
Special Common Stock Warrant: N/A
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1. NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
Getronics Acquisition, Inc.
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2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) [_]
(b) [_]
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3. SEC USE ONLY
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4. SOURCE OF FUNDS
AF
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5. CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO
ITEMS 2(e) or 2(f) [_]
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6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
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7. AGGREGATE AMOUNT BENEFICALLY OWNED
BY EACH REPORTING PERSON
0
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8. CHECK IF THE AGGREGATE AMOUNT IN ROW (7)
EXCLUDES CERTAIN SHARES [_]
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9. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
0.0%
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10. TYPE OF REPORTING PERSON
CO
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3
<PAGE>
Item 1. Security and Subject Company.
(a) This statement relates to the securities of Wang Laboratories, Inc., a
company organized under the laws of Delaware (the "Company"). The principal
executive offices of the Company are located at 290 Concord Road, Billerica,
Massachusetts 01821.
(b) This statement relates to (i) the shares of Common Stock, par value
$0.01 per share, including the associated rights (the "Common Stock"), of the
Company, (ii) the shares of 4 1/2% Series A Cumulative Convertible Preferred
Stock, par value $0.01 per share (the "Series A Preferred Stock"), of the
Company, (iii) the shares of 6 1/2% Series B Cumulative Convertible Preferred
Stock, par value $0.01 per share (the "Series B Preferred Stock"), of the
Company, (iv) depositary shares, each representing a 1/20th interest in a
share of Series B Preferred Stock (the "Depositary Shares"), (v) warrants
(other than the Special Common Stock Warrant) to purchase shares of Common
Stock ("Common Stock Purchase Warrants") and (vi) a Special Common Stock
Warrant (the "Special Common Stock Warrant"). The Common Stock, Series A
Preferred Stock, Series B Preferred Stock, Depositary Shares, Common Stock
Purchase Warrants and Special Common Stock Warrant are referred to herein
collectively as the Offer Securities. The information regarding the number of
each class of Offer Securities outstanding, the exact amount of each class of
Offer Securities being sought and the consideration being offered therefor is
set forth in the Introduction to the Offer to Purchase dated May 10, 1999 (the
"Offer to Purchase") and is incorporated herein by reference.
(c) The information concerning the principal markets in which the Offer
Securities are traded and the sales prices for the Offer Securities for each
quarterly period during the past two years is set forth in the Offer to
Purchase under Section 6--"Price Range; Dividends" and is incorporated herein
by reference.
Item 2. Identity and Background.
(a)-(d), (g) Getronics Acquisition, Inc. (the "Purchaser") is a corporation
organized under the laws of Delaware. The Purchaser is wholly-owned by
Getronics NV, a corporation organized under the laws of The Netherlands with
its corporate seat in Amsterdam (Municipality Amsterdam) ("Parent"). The
information set forth in the Offer to Purchase under Section 8--"Certain
Information Concerning the Purchaser and Parent" is incorporated herein by
reference. The name, business address, present principal occupation or
employment and material occupations, positions, offices or employment 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), (f) During the last five years, none of the Purchaser or Parent, or, to
the best of their knowledge, any of the persons listed in Schedule I to the
Offer to Purchase has been convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors) or was a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction as a
result of which any such person 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 law.
4
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Item 3. Past Contacts, Transactions or Negotiations with the Subject Company.
(a)-(b) The information set forth in the Offer to Purchase under the
Introduction, Section 10--"Background of the Offer" and Section 11--"Purpose
of the Offer; Plans for the Company; Certain Agreements" is incorporated
herein by reference.
Item 4. Source and Amount of Funds or Other Consideration.
(a)-(c) The information set forth in the Offer to Purchase under Section
9--"Source and Amount of Funds" is incorporated herein by reference.
Item 5. Purpose of the Tender Offer and Plans or Proposals of the Bidders.
(a)-(g) The information set forth in the Offer to Purchase under the
Introduction, Section 11--"Purpose of the Offer; Plans for the Company;
Certain Agreements" and Section 13--"Effect of the Offer on the Market for the
Offer Securities; Exchange Act Registration" is incorporated herein by
reference.
Item 6. Interest in Securities of the Subject Company.
(a)-(b) The information set forth in the Offer to Purchase under the
Introduction, Section 8--"Certain Information Concerning the Purchaser and
Parent", Section 9--"Background of the Offer" and Schedule I is incorporated
herein by reference.
Item 7. Contracts, Arrangements, Understandings or Relationships with Respect
to the Subject Company's Securities.
The information set forth in the Offer to Purchase under the Introduction,
Section 10--"Background of the Offer", Section 11--"Purpose of the Offer;
Plans for the Company; Certain Agreements" and Section 15--"Certain Legal
Matters; Regulatory Approvals" is incorporated herein by reference.
Item 8. Persons Retained, Employed or to be Compensated.
The information set forth in the Offer to Purchase under Section 16--"Fees
and Expenses" is incorporated by reference.
Item 9. Financial Statements of Certain Bidders.
The information set forth in the Offer to Purchase under Section 8--"Certain
Information Concerning the Purchaser and Parent" is incorporated herein by
reference.
Item 10. Additional Information.
(a) The information set forth in the Offer to Purchase under Section 11--
"Purpose of the Offer; Plans for the Company; Certain Agreements" is
incorporated herein by reference.
(b)-(c) The information set forth in the Offer to Purchase under Section
15--"Certain Legal Matters; Regulatory Approvals" is incorporated herein by
reference.
5
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(d) The information set forth in the Offer to Purchase under Section 13--
"Effect of the Offer on the Market for the Offer Securities; Exchange Act
Registration" is incorporated herein by reference.
(e) Not applicable.
(f) The information set forth in the entire text of each of (i) the Offer to
Purchase, (ii) the Letter of Transmittal to Tender Shares of Common Stock,
Shares of 6 1/2% Series B Cumulative Convertible Preferred Stock, Depositary
Shares (each representing a 1/20th interest in a share of 6 1/2% Series B
Cumulative Convertible Preferred Stock) and/or Common Stock Purchase Warrants,
(iii) the Letter of Transmittal to Tender Shares of 4 1/2% Series A Cumulative
Convertible Preferred Stock and/or the Special Common Stock Warrant and (iv)
the Agreement and Plan of Merger dated as of May 3, 1999 among Parent, the
Purchaser and the Company, copies of which are attached hereto as Exhibits
(a)(1), (a)(2), (a)(3) and (c)(1) respectively, is incorporated herein by
reference.
Item 11. Material to be Filed as Exhibits.
<TABLE>
<CAPTION>
Exhibit No. Description
----------- -----------
<C> <S>
Exhibit (a)(1) Offer to Purchase.
Exhibit (a)(2) Letter of Transmittal to Tender Shares of Common Stock, Shares
of 6 1/2% Series B Cumulative Convertible Preferred Stock,
Depositary Shares (each representing a 1/20th interest in a
share of 6 1/2% Series B Cumulative Convertible Preferred
Stock) and/or Common Stock Purchase Warrants.
Exhibit (a)(3) Letter of Transmittal to Tender Shares of 4 1/2% Series A
Cumulative Convertible Preferred Stock and/or the Special
Common Stock Warrant.
Exhibit (a)(4) Form of letter to brokers, dealers, commercial banks, trust
companies and other nominees.
Exhibit (a)(5) Form of letter to be used by brokers, dealers, commercial
banks, trust companies and nominees to their clients.
Exhibit (a)(6) Press Release, dated May 4, 1999, announcing the tender offer.
Exhibit (a)(7) Form of newspaper advertisement, dated May 10, 1999, published
in The Wall Street Journal.
Exhibit (a)(8) Notice of Guaranteed Delivery for Tender of Common Stock,
Shares of 6 1/2% Series B Cumulative Convertible Preferred
Stock, Depositary Shares (each representing a 1/20th interest
in a share of 6 1/2% Series B Cumulative Convertible Preferred
Stock) and/or Common Stock Purchase Warrants.
Exhibit (a)(9) Notice of Guaranteed Delivery for Tender of 4 1/2% Series A
Cumulative Convertible Preferred Stock and/or the Special
Common Stock Warrant.
Exhibit (a)(10) Guidelines for Substitute Form W-9.
Exhibit (b)(1) Commitment letter regarding NLG 4,000,000,000 Multicurrency
Bridge Facility, dated May 3, 1999, among ABN AMRO Bank N.V.,
ING Bank N.V. and Getronics NV.
Exhibit (c)(1) Confidentiality Agreement dated February 26, 1999 between
Getronics NV and Wang Laboratories, Inc.
Exhibit (c)(2) The Agreement and Plan of Merger dated as of May 3, 1999 among
Getronics NV, Getronics Acquisition, Inc. and Wang
Laboratories, Inc.
Exhibit (g)(1) Excerpts from the 1998 Annual Report of Getronics NV.
</TABLE>
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 10, 1999 GETRONICS NV
BY: /s/ J.L. Docter
----------------------------------
NAME: J.L. Docter
TITLE: Chief Financial Officer
Dated: May 10, 1999 GETRONICS ACQUISITION, INC.
BY: /s/ J.L. Docter
----------------------------------
NAME: J.L. Docter
TITLE: Treasurer
7
<PAGE>
Exhibit 99(a)(1)
OFFER TO PURCHASE FOR CASH
All of the Outstanding Shares of Common Stock
(Including the Associated Rights),
All of the Outstanding Shares of 4 1/2% Series A Cumulative
Convertible Preferred Stock,
All of the Outstanding Shares of 6 1/2% Series B Cumulative
Convertible Preferred Stock,
All of the Outstanding Depositary Shares (each representing a 1/20th interest
in a Share of 6 1/2% Series B Cumulative Convertible Preferred Stock),
All of the Outstanding Common Stock Purchase Warrants
and
The Outstanding Special Common Stock Warrant
of
Wang Laboratories, Inc.
at
$29.25 Net Per Share of Common Stock,
$1,271.73 Net Per Share of 4 1/2% Series A Cumulative Convertible Preferred
Stock,
$1,101.17 Net Per Share of 6 1/2% Series B Cumulative Convertible Preferred
Stock,
$55.05 Net Per Depositary Share,
$7.80 Net Per Common Stock Purchase Warrant
and
$6,250,000.00 Net for the Special Common Stock Warrant, respectively,
by
Getronics Acquisition, Inc.
A Wholly-Owned Subsidiary of
Getronics NV
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON MONDAY, JUNE 7, 1999 UNLESS THE OFFER IS EXTENDED.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (I) THERE BEING VALIDLY
TENDERED AND NOT PROPERLY WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A
NUMBER OF SHARES OF COMMON STOCK, INCLUDING THE ASSOCIATED RIGHTS (THE "COMMON
STOCK"), SHARES OF 4 1/2% SERIES A CUMULATIVE CONVERTIBLE PREFERRED STOCK (THE
"SERIES A PREFERRED STOCK"), SHARES OF 6 1/2% SERIES B CUMULATIVE CONVERTIBLE
PREFERRED STOCK (THE "SERIES B PREFERRED STOCK"), DEPOSITARY SHARES, EACH
REPRESENTING A 1/20TH INTEREST IN A SHARE OF SERIES B PREFERRED STOCK (THE
"DEPOSITARY SHARES"), WARRANTS TO PURCHASE SHARES OF COMMON STOCK (THE "COMMON
STOCK PURCHASE WARRANTS") AND THE SPECIAL COMMON STOCK WARRANT (THE "SPECIAL
COMMON STOCK WARRANT" AND, COLLECTIVELY WITH THE COMMON STOCK, THE SERIES A
PREFERRED STOCK, THE SERIES B PREFERRED STOCK, THE DEPOSITARY SHARES AND THE
COMMON STOCK PURCHASE WARRANTS, THE "OFFER SECURITIES") OF WANG LABORATORIES,
INC. (THE "COMPANY") WHICH REPRESENT AT LEAST A MAJORITY OF THE COMMON STOCK
EQUIVALENTS (AS SUCH TERM IS DEFINED IN THE OFFER) ON THE DATE OF PURCHASE
(THE "MINIMUM CONDITION"), (II) THE RECEIPT OF CERTAIN GOVERNMENTAL APPROVALS
AND (III) THE SATISFACTION OF CERTAIN OTHER TERMS AND CONDITIONS DESCRIBED IN
SECTION 14--"CONDITIONS OF THE OFFER".
THE OFFER IS BEING MADE PURSUANT TO THE AGREEMENT AND PLAN OF MERGER (THE
"MERGER AGREEMENT"), DATED MAY 3, 1999, BY AND AMONG PARENT, THE PURCHASER AND
THE COMPANY. SEE SECTION 11--"PURPOSE OF THE OFFER; PLANS FOR THE COMPANY;
CERTAIN AGREEMENTS".
THE BOARD OF DIRECTORS OF THE COMPANY (I) HAS DETERMINED THAT EACH OF THE
OFFER AND THE MERGER OF THE PURCHASER WITH AND INTO THE COMPANY (THE "MERGER")
IS FAIR TO, AND IN THE BEST INTERESTS OF, THE HOLDERS OF THE OFFER SECURITIES
AND HAS DECLARED THAT THE OFFER AND THE MERGER ARE ADVISABLE, (II) HAS
APPROVED THE OFFER AND THE MERGER AND (III) HAS RECOMMENDED THAT THE HOLDERS
OF THE OFFER SECURITIES ACCEPT THE OFFER AND TENDER THEIR OFFER SECURITIES
PURSUANT TO THE OFFER AND THAT THE HOLDERS OF COMMON STOCK, SERIES A PREFERRED
STOCK, SERIES B PREFERRED STOCK AND DEPOSITARY SHARES APPROVE AND ADOPT THE
MERGER AGREEMENT.
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The Dealer Manager for the Offer is:
Merrill Lynch & Co.
May 10, 1999
<PAGE>
IMPORTANT
Any holder of Offer Securities desiring to tender all or any portion of the
Offer Securities owned by such holder should either (i) complete and sign the
applicable Letter of Transmittal or a copy thereof in accordance with the
instructions in such Letter of Transmittal and mail or deliver it together
with the certificate(s) evidencing tendered Offer Securities, and any other
required documents, to the Depositary, (ii) where applicable, cause such
holder's broker, dealer, commercial bank, trust company or custodian to tender
such Offer Securities pursuant to the procedures for book-entry transfer of
Offer Securities or (iii) comply with the guaranteed delivery procedure, in
each case, upon the terms set forth in Section 3--"Procedures for Tendering
Offer Securities". Any holder whose Offer Securities are registered in the
name of a broker, dealer, commercial bank, trust company or custodian must
contact such broker, dealer, commercial bank, trust company or custodian if
such holder desires to tender such Offer Securities. See Section 2--
"Acceptance for Payment and Payment for Offer Securities".
References to shares of Common Stock include references to the associated
rights (the "Rights") issued pursuant to the Rights Agreement, dated as of
April 22, 1998, by and between the Company and the American Stock Transfer and
Trust Company, as Rights Agent, unless the context indicates otherwise. In
order to validly tender shares of Common Stock, a holder must tender the
associated Rights. The tender of a share of Common Stock will constitute the
tender of the associated Rights. See Section 2--"Acceptance for Payment and
Payment for Offer Securities".
Any holder who desires to tender Offer Securities and whose certificate(s)
evidencing such Offer Securities are not immediately available, or who cannot
comply with the procedures for book-entry transfer described in this Offer to
Purchase on a timely basis, may tender such Offer Securities by following the
procedures for guaranteed delivery set forth in Section 3--"Procedures for
Tendering Offer Securities".
Copies of this Offer to Purchase, the related Letters of Transmittal or of
any related documents must not be mailed to or otherwise distributed or sent
in, into or from any country where such distribution or offering would require
any additional measures to be taken or would be in conflict with any law or
regulation of such a country or any political subdivision thereof. Persons
into whose possession this document comes are required to inform themselves
about and to observe any such laws or regulations. This Offer to Purchase may
not be used for, or in connection with, any offer to, or solicitation by,
anyone in any jurisdiction or under any circumstances in which such offer or
solicitation is not authorized or is unlawful. This Offer to Purchase, the
related Letters of Transmittal or any related documents may not be issued or
passed on to any person in the United Kingdom unless such person is of a kind
described in Article 11(3) of the Financial Services Act 1986 (Investment
Advertisements) (Exemptions) Order 1996, as amended, or is a person to whom
this document may otherwise be lawfully issued or passed on.
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 on the back cover of this Offer to Purchase. Additional
copies of this Offer to Purchase, the applicable Letter of Transmittal or
other related tender offer materials may be obtained from the Information
Agent or from brokers, dealers, commercial banks, trust companies or
custodians.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
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<S> <C>
INTRODUCTION.............................................................. 1
THE TENDER OFFER.......................................................... 3
1. Terms of the Offer.................................................. 3
2. Acceptance for Payment and Payment for Offer Securities............. 5
3. Procedures for Tendering Offer Securities........................... 6
4. Withdrawal Rights................................................... 9
5. Certain United States Federal Income Tax Consequences............... 10
6. Price Range; Dividends.............................................. 11
7. Certain Information Concerning the Company.......................... 13
8. Certain Information Concerning the Purchaser and Parent............. 20
9. Source and Amount of Funds.......................................... 24
10. Background of the Offer............................................. 25
11. Purpose of the Offer; Plans for the Company; Certain Agreements..... 26
12. Dividends and Distributions......................................... 37
13. Effect of the Offer on the Market for the Offer Securities; Exchange
Act Registration....................................................... 38
14. Conditions of the Offer............................................. 39
15. Certain Legal Matters; Regulatory Approvals......................... 41
16. Fees and Expenses................................................... 46
17. Miscellaneous....................................................... 46
</TABLE>
<TABLE>
<C> <S>
SCHEDULE I Information Concerning the Directors and Executive Officers of
Getronics NV and Getronics Acquisition, Inc.
</TABLE>
i
<PAGE>
To the Holders of Common Stock, 4 1/2% Series A Cumulative
Convertible Preferred Stock, 6 1/2% Series B Cumulative
Convertible Preferred Stock, Depositary Shares (each
representing a 1/20th interest in a Share of 6 1/2% Series B Cumulative
Convertible Preferred Stock), Common Stock Purchase
Warrants and the Special Common Stock Warrant:
INTRODUCTION
Getronics Acquisition, Inc., a Delaware corporation (the "Purchaser"), and a
wholly-owned subsidiary of Getronics NV, a public company with limited
liability incorporated under the laws of The Netherlands with its corporate
seat in Amsterdam, The Netherlands ("Parent"), hereby offers to purchase (i)
all of the issued and outstanding shares of common stock, par value $0.01 per
share, including the associated rights (the "Common Stock"), of Wang
Laboratories, Inc., a company organized under the laws of Delaware (the
"Company"), at a price of $29.25 per share of Common Stock, net to the seller
in cash, without interest thereon (the "Common Stock Offer Price"), (ii) all
of the issued and outstanding shares of 4 1/2% Series A Cumulative Convertible
Preferred Stock, par value $0.01 per share (the "Series A Preferred Stock"),
of the Company at a price of $1,271.73 per share of Series A Preferred Stock,
net to the seller in cash, without interest thereon (the "Series A Preferred
Stock Offer Price"), (iii) all of the issued and outstanding shares of 6 1/2%
Series B Cumulative Convertible Preferred Stock, par value $0.01 per share
(the "Series B Preferred Stock"), of the Company at a price of $1,101.17 per
share of Series B Preferred Stock, net to the seller in cash, without interest
thereon (the "Series B Preferred Stock Offer Price"), (iv) all of the issued
and outstanding depositary shares, each representing a 1/20th interest in a
share of Series B Preferred Stock (the "Depositary Shares"), at a price of
$55.05 per Depositary Share, net to the seller in cash, without interest
thereon (the "Depositary Shares Offer Price"), (v) all of the issued and
outstanding warrants (other than the Special Common Stock Warrant) of the
Company to purchase shares of Common Stock (the "Common Stock Purchase
Warrants") at a price of $7.80 per Common Stock Purchase Warrant, net to the
seller in cash, without interest thereon (the "Common Stock Purchase Warrants
Offer Price") and (vi) the issued and outstanding warrant of the Company (the
"Special Common Stock Warrant") giving the holder the right to receive a
certain number of shares of Common Stock upon exercise thereof, at a price of
$6,250,000.00, net to the seller in cash, without interest thereon (the
"Special Common Stock Warrant Offer Price" and, together with the Common Stock
Offer Price, the Series A Preferred Stock Offer Price, the Series B Preferred
Stock Offer Price, the Depositary Shares Offer Price and the Common Stock
Purchase Warrants Offer Price, collectively, the "Offer Price"), upon the
terms and subject to the conditions set forth in this Offer to Purchase and in
the related Letters of Transmittal (which, as they may be amended and
supplemented from time to time, together constitute the "Offer"). Unless the
context indicates otherwise, as used herein, "Offer Securities" shall mean the
shares of Common Stock, the shares of Series A Preferred Stock, the shares of
Series B Preferred Stock, the Depositary Shares, the Common Stock Purchase
Warrants and the Special Common Stock Warrant. Unless the context indicates
otherwise, all references to shares of Common Stock shall include the
associated rights (the "Rights") issued pursuant to the Rights Agreement,
dated as of April 22, 1998 (the "Rights Agreement"), by and between the
Company and the American Stock Transfer and Trust Company ("ASTT"), as Rights
Agent.
Tendering holders whose Offer Securities are registered in their own name
and who tender directly to Citibank, N.A., as Depositary (the "Depositary")
will not be obligated to pay brokerage fees or commissions or, except as set
forth in Instruction 6 of the applicable Letter of Transmittal, stock transfer
taxes on the purchase of Offer Securities pursuant to the Offer. The Purchaser
will pay all charges and expenses of Merrill Lynch, Pierce, Fenner & Smith
Incorporated, as Dealer Manager (the "Dealer Manager" or "Merrill Lynch"), the
Depositary, and Morrow & Co., Inc., as Information Agent (the "Information
Agent"), in each case incurred in connection with the Offer. See Section 16--
"Fees and Expenses".
The Offer is conditioned upon, among other things, (i) there being validly
tendered and not properly withdrawn prior to the expiration of the Offer a
number of Offer Securities which represent at least a
1
<PAGE>
majority of the Common Stock Equivalents (as such term is defined herein) on
the date of purchase (the "Minimum Condition"), (ii) the receipt of certain
Governmental Approvals (as such term is defined herein) and (iii) the
satisfaction of certain other terms and conditions described in Section 14--
"Conditions of the Offer".
"Common Stock Equivalents" shall mean such number of shares of Common Stock
represented by Offer Securities or stock options and other rights to purchase
Common Stock (the "Options") which, in the case of (i) one (1) share of Common
Stock, is 1, (ii) one (1) share of Series A Preferred Stock, is 43.478, (iii)
one (1) share of Series B Preferred Stock, is 37.647, (iv) one (1) Depositary
Share, is 1.882, (v) one (1) Common Stock Purchase Warrant, is 1, (vi) the
Special Common Stock Warrant, is 213,675, and (vii) each Option, is equal to
the number of shares of Common Stock issuable upon exercise of such Option.
The Company has informed the Purchaser that, as of May 3, 1999, there were
issued and outstanding (i) 47,045,593 shares of Common Stock, (ii) 90,000
shares of Series A Preferred Stock, (iii) 2,875,000 Depositary Shares
(representing 143,750 shares of Series B Preferred Stock), (iv) 7,208,935
Common Stock Purchase Warrants, (v) the Special Common Stock Warrant and (vi)
Options exercisable into 8,941,077 shares of Common Stock. As a result, as of
such date, the Minimum Condition would be satisfied if, in the aggregate, a
combination of Common Stock, Series A Preferred Stock, Series B Preferred
Stock, Depositary Shares, Common Stock Purchase Warrants and the Special
Common Stock Warrant representing 36,367,045 Common Stock Equivalents would be
tendered and not properly withdrawn prior to the expiration of the Offer.
The Offer is being made pursuant to the Agreement and Plan of Merger, dated
as of May 3, 1999 (the "Merger Agreement"), by and among Parent, the Purchaser
and the Company. The Merger Agreement provides that, promptly upon
consummation of the Offer, Parent will cause the Purchaser to be merged with
and into the Company (the "Merger"). At the effective time of the Merger (the
"Effective Time"), except for the Offer Securities which are held by any
subsidiary of the Company or in the treasury of the Company, or which are
held, directly or indirectly, by Parent or any direct or indirect subsidiary
of Parent (including the Purchaser), all of which shall cease to be
outstanding and be canceled and retired and none of which shall receive any
payment with respect thereto and Offer Securities held by holders exercising
their rights to dissent in accordance with the Delaware General Corporation
Law (the "DGCL"), (i) each share of Common Stock (including all associated
Rights) issued and outstanding immediately prior to the Effective Time and all
rights in respect thereof shall, by virtue of the Merger and without any
action on the part of the holder thereof, forthwith cease to exist and be
converted into and represent the right to receive an amount in cash equal to
$29.25, without interest, (ii) each share of Series A Preferred Stock issued
and outstanding immediately prior to the Effective Time and all rights in
respect thereof shall, immediately prior to the Merger and without any action
on the part of the holders thereof, be converted into 43.478 fully paid and
nonassessable shares of Common Stock, such shares of Common Stock thereafter
to be treated in accordance with clause (i) above, (iii) each share of Series
B Preferred Stock issued and outstanding immediately prior to the Effective
Time shall, by virtue of the Merger and without any action on the part of the
holders thereof, no longer be convertible into shares of Common Stock but
shall thereafter be convertible, in accordance with Section 7(E) of the
Certificate of Designation of the Series B Preferred Stock, into the right to
receive an amount in cash equal to $1,101.17, without interest, (iv) each
Common Stock Purchase Warrant issued and outstanding immediately prior to the
Effective Time and all rights in respect thereof shall, by virtue of the
Merger and without any action on the part of the holders thereof, no longer be
exercisable into the right to receive Common Stock but shall become
exercisable, in accordance with Section 11.5 of the Warrant Agreement, dated
as of October 29, 1993, by and between the Company and ASTT, into the right to
receive an amount in cash equal to $7.80, without interest and (v) the Special
Common Stock Warrant issued and outstanding immediately prior to the Effective
Time and all rights in respect thereof shall, by virtue of the Merger and
without any action on the part of the holder thereof, expire. The Merger
Agreement is more fully described in Section 11--"Purpose of the Offer; Plans
for the Company; Certain Agreements". Under the DGCL, if the Purchaser
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acquires, pursuant to the Offer or otherwise, at least 90% of the issued and
outstanding shares of each of the Common Stock, the Series A Preferred Stock
and the Series B Preferred Stock, the Purchaser will be able to approve and
effect the Merger without a vote of the Company's stockholders. If, however,
the Purchaser does not acquire at least 90% of the issued and outstanding
shares of each of the Common Stock, the Series A Preferred Stock and the
Series B Preferred Stock, pursuant to the Offer or otherwise, a vote of the
Company's stockholders to effect the Merger is required under the DGCL and a
longer period of time will be required to effect the Merger. See Section 11--
"Purpose of the Offer; Plans for the Company; Certain Agreements".
The board of directors of the Company (the "Board of Directors") (i) has
determined that each of the Offer and the Merger is fair to, and in the best
interest of, the holders of the Offer Securities and has declared that the
Offer and the Merger are advisable, (ii) has approved the Offer and the Merger
and (iii) has recommended that the holders of the Offer Securities accept the
Offer and tender their Offer Securities pursuant to the Offer and that the
holders of Common Stock, Series A Preferred Stock, Series B Preferred Stock
and Depositary Shares approve and adopt the Merger Agreement.
"Governmental Approvals" means (i) the expiration or termination of any
applicable waiting period (and any extension thereof) under (A) the Hart-
Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the rules and
regulations thereunder (the "HSR Act"), (B) the voluntary notification under
Section 721 of the Defense Production Act of 1950, as amended ("Exon-Florio"),
(ii) a decision of the European Commission that the purchase of the Offer
Securities contemplated by the Offer is compatible with the common market and
(iii) the receipt of approvals and consents from certain other governmental
agencies and authorities. See Section 14--"Conditions of the Offer" for a
complete description of the conditions to the Offer.
This Offer to Purchase and the Letters of Transmittal contain important
information which should be read carefully before any decision is made with
respect to the Offer.
THE TENDER OFFER
1. Terms of the Offer. Upon the terms and subject to the conditions of the
Offer (including, if the Offer is extended or amended, the terms and
conditions of any extension or amendment), the Purchaser will accept for
payment and pay for all Offer Securities validly tendered prior to the
Expiration Date (as hereinafter defined) and not withdrawn in accordance with
Section 4--"Withdrawal Rights". The term "Expiration Date" means 12:00
Midnight, New York City time, on Monday, June 7, 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 Offer is conditioned upon, among other things, satisfaction of the
Minimum Condition and the receipt of the Governmental Approvals. The Offer is
also subject to certain other conditions set forth in Section 14--"Conditions
of the Offer". If these or any of the other conditions referred to in Section
14--"Conditions of the Offer" are not satisfied or any of the events specified
in Section 14--"Conditions of the Offer" have occurred or are determined by
the Purchaser to have occurred prior to the Expiration Date, the Purchaser,
subject to the terms of the Merger Agreement, reserves the right (but is not
obligated) to (i) decline to purchase any of the Offer Securities tendered in
the Offer and terminate the Offer, and return all tendered Offer Securities to
the tendering holders of the Offer Securities, (ii) waive or amend any or all
conditions to the Offer and, to the extent permitted by applicable law and
applicable rules and regulations of the Securities and Exchange Commission
(the "Commission"), purchase all Offer Securities validly tendered or (iii)
subject to the limitations described below, extend the Offer and, subject to
the right of a tendering holder to withdraw its Offer Securities until the
Expiration Date, retain the Offer Securities which have been tendered during
the period or periods for which the Offer is extended, provided, however,
that, subject to the terms of the Merger Agreement, the Minimum Condition may
not be waived by the Purchaser in its sole discretion.
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Subject to the terms of the Merger Agreement and the applicable rules and
regulations of the Commission and to applicable law, the Purchaser expressly
reserves the right, in its sole discretion, at any time and from time to time,
to extend for any reason the period of time during which the Offer is open,
including upon the occurrence of any of the events specified in Section 14--
"Conditions of the Offer", by giving notice of such extension to the
Depositary and by making a public announcement thereof. During any such
extension, all Offer Securities previously tendered and not withdrawn will
remain subject to the Offer, subject to the rights of a tendering holder to
withdraw its Offer Securities. See Section 4--"Withdrawal Rights".
Subject to the applicable rules and regulations of the Commission and to
applicable law, the Purchaser also expressly reserves the right, in its sole
discretion (subject to the terms of the Merger Agreement), at any time and
from time to time (i) to delay acceptance for payment of, or, regardless of
whether such Offer Securities were theretofore accepted for payment, payment
for, any Offer Securities (a) if any applicable waiting period (or extension
thereof) under the HSR Act has not expired or been terminated, (b) if a
decision of the Commission of the European Community that the purchase of the
Offer Securities pursuant to the Offer is compatible with the common market
has not been received, (c) if any applicable waiting period under Exon-Florio
has not expired or been terminated or (d) in order to comply in whole or in
part with any other applicable law, (ii) to terminate the Offer and not accept
for payment any Offer Securities if any of the conditions referred to in
Section 14--"Conditions of the Offer" are not satisfied or any of the events
specified in Section 14--"Conditions of the Offer" have occurred and (iii)
subject to the terms of the Merger Agreement, to waive any condition, or
otherwise amend the Offer in any respect by giving oral or written notice of
such delay, termination, waiver or amendment to the Depositary and by making a
public announcement thereof.
The Purchaser reserves the right to modify the terms of the Offer including,
without limitation, except as provided below, to extend the Offer beyond any
scheduled expiration date, except that, without the written consent of the
Company, the Purchaser will not reduce the number of Offer Securities sought
in the Offer, reduce the Offer Price, or modify, waive or add to the
conditions of the Offer referred to in Section 14--"Conditions of the Offer".
The Purchaser reserves the right (but, subject to the terms of the Merger
Agreement, will not be obligated) to extend the offer from time to time if and
to the extent (i) the applicable waiting period under each of the HSR Act or
Exon-Florio described in Section 15--"Certain Legal Matters; Regulatory
Approvals" has not expired or been terminated on the Expiration Date or (ii) a
decision of the Commission of the European Community that the purchase of the
Offer Securities pursuant to the Offer is compatible with the common market
has not been received.
The Purchaser acknowledges that (i) Rule 14e-1(c) under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), requires the Purchaser
to pay the consideration offered or return the Offer Securities tendered
promptly after the termination or withdrawal of the Offer and (ii) the
Purchaser may not delay acceptance for payment of, or payment for (except as
provided in clause (i) of the second preceding paragraph), any Offer
Securities upon the occurrence of any of the conditions specified in Section
14--"Conditions of the Offer" without extending the period of time during
which the Offer is open.
During any such extension, all Offer Securities previously tendered and not
properly withdrawn will remain subject to the Offer, subject to the right of a
tendering holder to withdraw its Offer Securities. Any such extension, delay,
termination, waiver or amendment will be followed, as promptly as practicable,
by public announcement thereof, with such announcement in the case of an
extension to be made no later than 9:00 a.m., New York City time, on the next
business day after the previously scheduled expiration date. Subject to
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applicable law (including Rules 14d-4(c), 14d-6(d) and 14e-1 under the
Exchange Act), which require that material changes be promptly disseminated to
holders in a manner reasonably designed to inform them of such changes and
without limiting the manner in which the Purchaser may choose to make any
public announcement, the Purchaser will have no obligation to publish,
advertise or otherwise communicate any such public announcement other than by
issuing a press release to the Dow Jones News Service or as otherwise may be
required by applicable law.
If the Purchaser makes a material change in the terms of the Offer or the
information concerning the Offer, or if it waives a material condition of the
Offer, the Purchaser will extend the Offer to the extent required by Rules
14d-4(c), 14d-6(d) and 14e-1 under the Exchange Act.
The Company has provided the Purchaser with the Company's list of holders of
the Offer Securities and security position listings in respect of the Offer
Securities for the purpose of disseminating the Offer to Purchase, the
applicable Letter of Transmittal, and other relevant materials to holders of
Offer Securities. This Offer to Purchase, the related Letters of Transmittal
and other relevant materials will be mailed to record holders of Offer
Securities whose names appear on the Company's list of holders of the Offer
Securities and will be furnished, for subsequent transmittal to beneficial
owners of Offer Securities, to brokers, dealers, commercial banks, trust
companies, custodians and similar persons whose names, or the names of whose
nominees, appear on the list of holders of the Offer Securities or, where
applicable, who are listed as participants in the security position listing of
The Depository Trust Company ("DTC").
2. Acceptance for Payment and Payment for Offer Securities. 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 purchase, by accepting for payment, and will
pay for, all Offer Securities validly tendered prior to the Expiration Date
(and not properly withdrawn in accordance with Section 4--"Withdrawal Rights")
promptly after the later to occur of (i) the Expiration Date and (ii) the
receipt of certain Governmental Approvals specified in Section 15--"Certain
Legal Matters; Regulatory Approvals". Subject to applicable rules of the
Commission and the terms of the Merger Agreement, the Purchaser expressly
reserves the right, in its discretion, to delay acceptance for payment of, or
payment for, Offer Securities pending receipt of certain Governmental
Approvals specified in Section 15--"Certain Legal Matters; Regulatory
Approvals". If, following acceptance for payment of Offer Securities, the
Purchaser asserts such Governmental Approvals as a condition and does not
promptly pay for Offer Securities tendered, the Purchaser will promptly return
such Offer Securities.
In all cases, payment for Offer Securities purchased pursuant to the Offer
will be made only after timely receipt by the Depositary of (i) the
certificates evidencing such Offer Securities (the "Offer Security
Certificates") or timely confirmation of a book-entry transfer (a "Book-Entry
Confirmation") of such Offer Securities into the Depositary's account at DTC
(the "Book-Entry Transfer Facility"), pursuant to the procedures set forth in
Section 3--"Procedures for Tendering Offer Securities", (ii) the applicable
Letter of Transmittal (or a copy 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 such Letter of Transmittal.
The term "Agent's Message" means a message, transmitted by the Book-Entry
Transfer Facility to, and received by, the Depositary forming a part of a
Book-Entry Confirmation system, which states that the Book-Entry Transfer
Facility has received an express acknowledgment from a participant (the
"Participant") in the Book-Entry Transfer Facility tendering the Offer
Securities that such Participant has received a copy of the Offer to Purchase
and agrees to be bound by the terms of the Offer 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) Offer Securities validly tendered and not
properly withdrawn if, as and when the Purchaser gives notice to the
Depositary of the Purchaser's acceptance for payment of such Offer Securities.
Payment for Offer
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Securities accepted pursuant to the Offer will be made by deposit of the
purchase price therefor with the Depositary, which will act as agent for
tendering holders for the purpose of receiving payments from the Purchaser and
transmitting payments to such tendering holders whose Offer Securities have
been accepted for payment. Under no circumstances will interest on the
purchase price for Offer Securities be paid by the Purchaser, regardless of
any delay in making such payment or extension of the Expiration Date. Upon the
deposit of funds with the Depositary for the purpose of making payments to
tendering holders, the Purchaser's obligation to make such payment shall be
satisfied, and tendering holders must thereafter look solely to the Depositary
for payment of amounts owed to them by reason of the acceptance for payment of
Offer Securities pursuant to the Offer.
If any tendered Offer Securities are not accepted for payment for any reason
pursuant to the terms and conditions of the Offer, or if Offer Security
Certificates are submitted evidencing more Offer Securities than are tendered,
Offer Security Certificates evidencing Offer Securities not purchased will be
returned, without expense to the tendering holder (or, in the case of Offer
Securities tendered by book-entry transfer into the Depositary's account at
the Book-Entry Transfer Facility pursuant to the procedure set forth in
Section 3--"Procedures for Tendering Offer Securities", such Offer Securities
will be credited to an account maintained at the Book-Entry Transfer
Facility), as promptly as practicable following the expiration, termination or
withdrawal of the Offer.
If, prior to the Expiration Date, the Purchaser increases the consideration
to be paid per Offer Security pursuant to the Offer, the Purchaser will pay
such increased consideration for all such Offer Securities purchased pursuant
to the Offer, whether or not such Offer Securities were tendered prior to such
increase in consideration.
The Purchaser reserves the right to assign to Parent, or to any other direct
or indirect wholly-owned subsidiary of Parent, the right to purchase all or
any portion of the Offer Securities tendered pursuant to the Offer, but any
such assignment will not relieve the Purchaser of its obligations under the
Offer and will in no way prejudice the rights of tendering holders to receive
payment for Offer Securities validly tendered and accepted for payment
pursuant to the Offer.
3. Procedures for Tendering Offer Securities.
Valid Tender of Offer Securities. In order for Offer Securities to be
validly tendered pursuant to the Offer, a holder of Offer Securities must,
prior to the Expiration Date, either (i) deliver to the Depositary at one of
its addresses set forth on the back cover of this Offer to Purchase (a) a
properly completed and duly executed Letter of Transmittal (or a copy thereof)
with any required signature guarantees, (b) the applicable Offer Security
Certificates and (c) any other documents required to be included with the
applicable Letter of Transmittal upon the terms and subject to the conditions
thereof and of this Offer to Purchase, (ii) cause such holder's broker,
dealer, commercial bank, trust company or custodian to tender applicable Offer
Securities pursuant to the procedures for book-entry transfer described below
or (iii) comply with the guaranteed delivery procedures described below.
If Rights Certificates (as defined herein) have been distributed to holders
of Common Stock, such holders are required to tender, or (if such procedure is
available) make book-entry transfer of, Rights Certificates representing a
number of Rights equal to the number of shares of Common Stock being tendered
in order to effect a valid tender of such Common Stock.
Series A Preferred Stock, Series B Preferred Stock and the Special Common
Stock Warrant may be tendered only upon physical delivery to the Depositary of
the applicable Letter of Transmittal and the certificate representing such
securities (as such securities have been issued only in certificated form).
The Common Stock, including the associated Rights, and the Common Stock
Purchase Warrants may be tendered by means of book-entry transfer (described
below) or upon physical delivery to the Depositary of the applicable Letter of
Transmittal and the certificate representing such securities (as such
securities have been issued in book-entry and certificated form).
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The Depositary Shares may be tendered only by means of Book-Entry Transfer
(as such securities have been issued only in book-entry form).
The method of delivery of Offer Security Certificates, the applicable Letter
of Transmittal and all other required documents, including delivery through
the Book-Entry Transfer Facility, is at the option and risk of the tendering
holder, and the delivery will be deemed made only when actually received by
the Depositary. If delivery is by mail, registered mail with return receipt
requested, properly insured, is recommended. In all cases, sufficient time
should be allowed to ensure timely delivery.
Book-Entry Transfer. The Depositary will establish an account with respect
to the Common Stock, including the associated Rights, the Common Stock
Purchase Warrants and the Depositary 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 may
tender shares of Common Stock, Common Stock Purchase Warrants or Depository
Shares in the Offer by (i) causing such securities to be transferred in
accordance with the Book-Entry Transfer Facility's procedures into the
applicable account maintained by the Depositary at the Book-Entry Transfer
Facility and (ii) causing the applicable Letter of Transmittal to be delivered
to the Depositary by means of an Agent's Message. In order to effect a valid
tender through the Book-Entry Transfer Facility, the shares of Common Stock,
including the associated Rights, the Common Stock Purchase Warrants or the
Depository Shares along with an Agent's Message and any other required
documents, must, in any case, be transmitted to, and received by, the
Depositary prior to the Expiration Date, or the tendering holder must comply
with the guaranteed delivery procedures described below. Delivery of documents
or instructions to the Book-Entry Transfer Facility in accordance with the
Book-Entry Transfer Facility's procedures does not constitute delivery to the
Depositary.
Signature Guarantee. Signatures on all Letters of Transmittal must be
guaranteed by a financial institution (including most banks, savings and loan
associations and brokerage houses) which is a participant in the Security
Transfer Agents Medallion Program, the New York Stock Exchange Medallion
Signature Guarantee Program or the Stock Exchange Medallion Program (an
"Eligible Institution"), unless the Offer Securities tendered thereby are
tendered (i) by the registered holder of Offer Securities who has not
completed the box entitled "Special Payment Instructions" on the applicable
Letter of Transmittal or (ii) for the account of an Eligible Institution. See
Instruction 1 to the applicable Letter of Transmittal.
If an Offer Security Certificate is registered in the name of a person other
than the signer of the applicable Letter of Transmittal, if payment is to be
made, or if an Offer Security Certificate not accepted for payment or not
tendered is to be returned, to a person other than the registered holder(s),
then the Offer Security 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(s) on the Offer Security Certificate, with the
signature(s) on such Offer Security Certificate or stock powers guaranteed as
described above. See Instructions 1, 5 and 7 to the applicable Letter of
Transmittal.
Guaranteed Delivery. If a holder desires to tender Offer Securities pursuant
to the Offer and such holder's Offer Security Certificates are not immediately
available or time will not permit all required documents to reach the
Depositary prior to the Expiration Date or the procedure for book-entry
transfer cannot be completed on a timely basis, such Offer Securities may
nevertheless be tendered if all the following conditions are satisfied:
(i) the tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form provided by the Purchaser herewith, is
received by the Depositary as provided below prior to the Expiration Date;
and
(iii) the Offer Security Certificates (and certificates in respect of
Rights ("Rights Certificates"), if such Rights Certificates have been
issued) for all tendered Offer Securities, in proper form for transfer,
together with a properly completed and duly executed Letter of Transmittal
(or a copy thereof) with any required
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signature guarantee (or, in the case of a book-entry transfer, a Book-Entry
Confirmation along with an Agent's Message) and any other documents
required by such Letter of Transmittal, are received by the Depositary
within three New York Stock Exchange trading days after the date of
execution of the Notice of Guaranteed Delivery, or in the case Rights
Certificates have been issued, three business days after the date Rights
Certificates are distributed to holders of Common Stock.
Any Notice of Guaranteed Delivery may be delivered by hand or transmitted by
mail to the Depositary and must include a guarantee by an Eligible Institution
in the form set forth in the Notice of Guaranteed Delivery. In the case of
Offer Securities held through the Book-Entry Transfer Facility, the Notice of
Guaranteed Delivery must be delivered to the Depositary by a Participant by
means of the confirmation system of the Book-Entry Transfer Facility.
Notwithstanding any other provision hereof, payment for Offer Securities
purchased pursuant to the Offer will, in all cases, be made only after timely
receipt by the Depositary of (i) the Offer Security Certificates evidencing
such Offer Securities or a Book-Entry Confirmation of the delivery of such
Offer Securities and, if Rights Certificates have been issued in respect of
Common Stock, such Rights Certificates or a Book-Entry Confirmation, if
available, with respect to such Rights Certificates (unless the Purchaser
elects, in its sole discretion, to make payment for the Offer Securities
pending receipt of the Rights Certificates or a Book-Entry Confirmation, if
available, with respect to such Rights Certificates), (ii) a properly
completed and duly executed Letter of Transmittal or a copy thereof (or, in
the case of a book-entry transfer, an Agent's Message) and (iii) any other
documents required by such Letter of Transmittal. Accordingly, tendering
holders may be paid at different times depending upon when Offer Security
Certificates (or Rights Certificates) or Book-Entry Confirmations with respect
to Offer Securities (or Rights Certificates, if available) are actually
received by the Depositary. Under no circumstances will interest be paid on
the purchase price of the Offer Securities to be paid by the Purchaser,
regardless of any extension of the Offer or any delay in making such payment.
Determination of Validity. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance for payment of any
tendered Offer Securities pursuant to any of the procedures described above
will be determined by the Purchaser, in its sole discretion, whose
determination will be final and binding on all parties. The Purchaser reserves
the absolute right to reject any or all tenders of any Offer Securities
determined by it not to be in proper form or if the acceptance for payment of,
or payment for, such Offer Securities may, in the opinion of the Purchaser's
counsel, be unlawful. The Purchaser also reserves the absolute right, in its
sole discretion, to waive any of the conditions of the Offer (subject to the
terms of the Merger Agreement) or any defect or irregularity in any tender
with respect to Offer Securities of any particular holder, whether or not
similar defects or irregularities are waived in the case of other holders. No
tender of Offer Securities will be deemed to have been validly made until all
defects and irregularities have been cured or waived.
The Purchaser's interpretation of the terms and conditions of the Offer
(including the applicable Letter of Transmittal and the instructions thereto)
will be final and binding.
Appointment as Proxy. By executing the applicable Letter of Transmittal (or
delivering an Agent's Message) as set forth above, a tendering holder
irrevocably appoints each designee of the Purchaser as such holder's attorney-
in-fact and proxy, with full power of substitution, to vote in such manner as
such attorney-in-fact and proxy (or any substitute thereof) shall deem proper
in its sole discretion, and to otherwise act (including pursuant to written
consent) to the full extent of such holder's rights with respect to the Offer
Securities tendered by such holder and accepted for payment by the Purchaser
(and any and all dividends, distributions, rights or other securities issued
or issuable in respect of such Offer Securities on or after May 3, 1999). All
such proxies shall be considered coupled with an interest in the tendered
Offer Securities and shall be irrevocable. This appointment will be effective
if, when, and only to the extent that, the Purchaser accepts such Offer
Securities for payment pursuant to the Offer. Upon such acceptance for
payment, all prior proxies given by such holder with respect to such Offer
Securities, rights or other securities will, without further action, be
revoked, and no subsequent proxies may be given (and, if given, will not be
deemed effective). The designees of the Purchaser will, with respect to the
Offer Securities, rights or other securities for which the appointment is
effective,
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be empowered to exercise all voting and other rights of such holder as they in
their sole discretion may deem proper at any annual, special, adjourned or
postponed meeting of the Company's stockholders, by written consent or
otherwise, and the Purchaser reserves the right to require that, in order for
the Offer Securities, rights or other securities to be deemed validly
tendered, immediately upon the Purchaser's acceptance for payment of such
Offer Securities, the Purchaser must be able to exercise all rights
(including, without limitation, all voting rights and rights of conversion)
with respect to such Offer Securities rights or other securities and receive
all dividends and distributions.
Backup Withholding. Under United States federal income tax law, the amount
of any payments made by the Depositary to holders (other than corporate and
certain other exempt holders) pursuant to the Offer may be subject to backup
withholding tax at a rate of 31%. To avoid such backup withholding tax with
respect to payments made pursuant to the Offer, a non-exempt tendering holder
must provide the Depositary with such holder's correct taxpayer identification
number and certify that such holder is not subject to backup withholding tax
by completing the Substitute Form W-9 included as part of the applicable
Letter of Transmittal. If backup withholding applies with respect to a holder
or if a holder fails to deliver a completed Substitute Form W-9 to the
Depositary or otherwise establish an exemption, the Depositary is required to
withhold 31% of any payments made to such holder. See Section 5--"Certain
United States Federal Income Tax Consequences" of this Offer to Purchase and
Instruction 9 to the applicable Letter of Transmittal.
The Purchaser's acceptance for payment of Offer Securities tendered pursuant
to the Offer will constitute a binding agreement between the tendering holder
and the Purchaser upon the terms and subject to the conditions of the Offer.
4. Withdrawal Rights. Tenders of Offer Securities made pursuant to the Offer
are irrevocable except that such Offer Securities 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 8, 1999, or at such later time as may apply if the Offer is extended.
If the Purchaser extends the Offer, is delayed in its acceptance for payment
of Offer Securities or is unable to accept Offer Securities 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 Offer Securities, and such Offer
Securities may not be withdrawn except to the extent that tendering holders
are entitled to withdrawal rights as described in this Section 4--"Withdrawal
Rights". Any such delay will be an extension of the Offer to the extent
required by law.
For a withdrawal to be effective, a written notice of withdrawal must be
timely received by the Depositary at one of its addresses set forth on the
back cover of this Offer to Purchase. Any such notice of withdrawal must
specify the name of the person who tendered the Offer Securities to be
withdrawn, the class of Offer Securities to be withdrawn, the number of Offer
Securities to be withdrawn and the name of the registered holder of the Offer
Securities, if different from that of the person who tendered such Offer
Securities. If Offer Security Certificates evidencing Offer Securities to be
withdrawn have been delivered or otherwise identified to the Depositary, then,
prior to the physical release of such Offer Security Certificates, the serial
numbers shown on such Offer Security 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 Offer Securities have been tendered
for the account of an Eligible Institution. Offer Securities tendered pursuant
to the procedure for book-entry transfer as set forth in Section 3--
"Procedures for Tendering Offer Securities", may be withdrawn only by means of
the withdrawal procedures made available by the Book-Entry Transfer Facility
to the Participants, must specify the name and number of the account at the
Book-Entry Transfer Facility to be credited with the withdrawn Offer
Securities and must otherwise comply with the Book-Entry Transfer Facility's
procedures.
Withdrawals of tendered Offer Securities may not be rescinded without the
Purchaser's consent and any Offer Securities properly withdrawn will
thereafter be deemed not validly tendered for purposes of the Offer. All
questions as to the form and validity (including time of receipt) of notices
of withdrawal will be determined by
9
<PAGE>
the Purchaser, in its sole discretion, which determination will be final and
binding. None of Parent, the Purchaser, the Depositary, the Information Agent,
the Dealer Manager 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 Offer Securities properly withdrawn may be re-tendered at any time prior
to the Expiration Date by following any of the procedures described in Section
3--"Procedures for Tendering Offer Securities".
5. Certain United States Federal Income Tax Consequences. The receipt of
cash for Offer Securities pursuant to the Offer or the Merger by a U.S. Holder
(defined below) will be a taxable transaction for United States federal income
tax purposes and may also be a taxable transaction under applicable state,
local or foreign tax laws. For purposes of this discussion, a "U.S. Holder" is
a beneficial owner of Offer Securities who for United States federal income
tax purposes is (i) a citizen or resident of the United States, (ii) a
corporation or partnership organized in or under the laws of the United States
or any State thereof (including the District of Columbia), (iii) an estate the
income of which is subject to United States federal income taxation regardless
of its source or (iv) a trust (a) the administration over which a United
States court can exercise primary supervision and (b) all of the substantial
decisions of which one or more United States persons have the authority to
control. Notwithstanding the preceding sentence, to the extent provided in the
Treasury Regulations, certain trusts in existence on August 20, 1996, and
treated as United States persons prior to such date, that maintain a valid
election to continue to be treated as United States persons also will be U.S.
Holders. In general, a U.S. Holder will recognize gain or loss for United
States federal income tax purposes equal to the difference, if any, between
the amount realized from the sale of Offer Securities and such U.S. Holder's
adjusted tax basis, if any, in such Offer Securities. Assuming that the Offer
Securities constitute a capital asset in the hands of the U.S. Holder, such
gain or loss will be capital gain or loss and, in the case of a noncorporate
U.S. Holder, the maximum marginal United States federal income tax rate
applicable to such gain will be lower than the maximum marginal United States
federal income tax rate applicable to ordinary income if such U.S. Holder's
holding period for such Offer Securities exceeds one year.
The foregoing discussion may not be applicable to certain types of holders,
including holders who acquired Offer Securities pursuant to the exercise of
stock options or otherwise as compensation, holders that are not U.S. Holders
and holders that are otherwise subject to special tax rules, such as financial
institutions, insurance companies, dealers or traders in securities or
currencies, tax-exempt entities, persons that hold Offer Securities as a
position in a "straddle" or as part of a "hedging" or "conversion" transaction
for tax purposes and persons that have a "functional currency" other than the
United States dollar.
Backup Withholding Tax. As noted in Section 3--"Procedures for Tendering
Offer Securities", a holder (other than an "exempt recipient", including a
corporation and a non-U.S. Holder that provides appropriate certification (if
the payor does not have actual knowledge that such certificate is false)) that
receives cash in exchange for Offer Securities may be subject to United States
federal backup withholding tax at a rate equal to 31%, unless such holder
provides its taxpayer identification number and certifies that such holder is
not subject to backup withholding tax by submitting a completed Substitute
Form W-9 to the Depositary. Accordingly, each holder should complete, sign and
submit the Substitute Form W-9 included as part of the applicable Letter of
Transmittal in order to avoid the imposition of such backup withholding tax.
The United States federal income tax discussion set forth above is included
for general information and is based upon laws, regulations, rulings and
decisions now in effect, all of which are subject to change (possibly
retroactively). Holders are urged to consult their tax advisors with respect
to the specific tax consequences of the Offer to them, including the
application and effect of the alternative minimum tax and state, local and
foreign tax laws.
10
<PAGE>
6. Price Range; Dividends.
Common Stock. The shares of Common Stock are listed and traded on the Nasdaq
Stock Market's National Market ("Nasdaq National Market") under the symbol
"WANG". The following table sets forth, for the periods indicated, the high
and low sales prices per share of Common Stock as reported by the Dow Jones
News Service:
<TABLE>
<CAPTION>
High Low
----- -----
<S> <C> <C>
1997:
Quarter ended 6/30/97......................................... 21.50 16.00
Quarter ended 9/30/97......................................... 23.13 18.63
Quarter ended 12/31/97........................................ 25.00 19.13
1998:
Quarter ended 3/31/98......................................... 31.63 21.38
Quarter ended 6/30/98......................................... 32.25 21.00
Quarter ended 9/30/98......................................... 26.13 17.75
Quarter ended 12/31/98........................................ 28.25 14.13
1999:
Quarter ended 3/31/99......................................... 28.13 18.81
Period 4/1/99 through 5/7/99.................................. 28.94 19.13
----- -----
</TABLE>
On May 3, 1998, the last full trading day prior to the public announcement
of the Offer, the last reported sales price of the Common Stock on the Nasdaq
National Market was $25.50 per share of Common Stock. On May 7, 1999, the last
full trading day prior to the date of this Offer to Purchase, the last
reported sales price of the Common Stock on the Nasdaq National Market was
$28.94 per share of Common Stock. Holders of Common Stock are urged to obtain
current market quotations for the Common Stock.
As of May 10, 1999, no dividends had ever been paid on the shares of Common
Stock.
Series A Preferred Stock. The Series A Preferred Stock is held by a single
holder. No price quotations are available for the Series A Preferred Stock.
The Series A Preferred Stock is entitled to cash dividends in the amount of
$45.00 per annum per share, payable quarterly in arrears. The Company has
advised the Purchaser that all dividend payments have been made on a timely
basis.
Series B Preferred Stock and the Depositary Shares. The Series B Preferred
Stock are not listed on any exchange or traded on the Nasdaq National Market.
No price quotations are available for the Series B Preferred Stock. One series
of the Depositary Shares were initially authorized to be part of the National
Association of Securities Dealers, Inc.'s (the "NASD") PORTAL System.
Currently, PORTAL System transactions are not reported to the NASD.
The Series B Preferred Stock is entitled to cash dividends in the amount of
$65.00 per annum per share, payable quarterly in arrears. The Company has
advised the Purchaser that all dividend payments have been made on a timely
basis.
Parent and the Purchaser have been advised that a second series of the
Depositary Shares are traded on the over-the-counter market on a limited and
sporadic basis. The following table sets forth, for the periods indicated, the
high and low bid quotations per Depositary Share as reported by Factset. Such
quotations represent inter-
11
<PAGE>
dealer quotations, without adjustment for retail markets, markdowns or
commissions, and do not necessarily represent actual transactions.
<TABLE>
<CAPTION>
High Low
----- -----
<S> <C> <C>
1997:
Quarter ended 6/30/97(/1/).................................... 51.25 47.75
Quarter ended 9/30/97......................................... 53.50 46.63
Quarter ended 12/31/97........................................ 54.50 47.13
1998:
Quarter ended 3/31/98......................................... 63.63 49.63
Quarter ended 6/30/98......................................... 62.88 49.63
Quarter ended 9/30/98......................................... 56.13 45.25
Quarter ended 12/31/98........................................ 59.63 38.88
1999:
Quarter ended 3/31/99......................................... 59.63 46.00
Period 4/1/99 through 5/7/99.................................. 60.38 46.00
----- -----
</TABLE>
- --------
(1) Period 5/9/97 through 6/30/97.
On May 3, 1999, the last day on which the Depositary Shares were traded prior
to the public announcement of the Offer, the reported closing bid quotation of
the Depositary Shares on the over-the-counter market was $53.63 per Depositary
Share. On May 7, 1999, the last day on which the Depositary Shares were traded
prior to the date of this Offer to Purchase, the reported closing bid quotation
of the Depositary Shares on the over-the-counter market was $60.38 per
Depositary Share. Holders are urged to obtain a current market quotation for
the Depositary Shares.
12
<PAGE>
Common Stock Purchase Warrants. The Common Stock Purchase Warrants are
listed and traded on the Nasdaq National Market under the symbol "WANG W". The
following table sets forth, for the periods indicated, the high and low sales
prices per Common Stock Purchase Warrant as reported by the Dow Jones News
Services:
<TABLE>
<CAPTION>
High Low
----- ----
<S> <C> <C>
1997:
Quarter ended 6/30/97.......................................... 6.63 4.25
Quarter ended 9/30/97.......................................... 7.94 5.31
Quarter ended 12/31/97......................................... 8.75 4.63
1998:
Quarter ended 3/31/98.......................................... 13.94 5.44
Quarter ended 6/30/98.......................................... 14.50 6.09
Quarter ended 9/30/98.......................................... 9.13 4.50
Quarter ended 12/31/98......................................... 10.56 2.88
1999:
Quarter ended 3/31/99.......................................... 10.50 4.47
Period 4/1/99 through 5/7/1999................................. 8.75 4.88
----- ----
</TABLE>
On May 3, 1999, the last full trading day prior to the public announcement
of the Offer, the last reported sales price of the Common Stock Purchase
Warrants on the Nasdaq National Market was $8.63 per Common Stock Purchase
Warrant. On May 7, 1999, the last day full trading prior to the date of this
Offer to Purchase, the last reported sales price of the Common Stock Purchase
Warrants on the Nasdaq National Market was $7.63 per Common Stock Purchase
Warrant. Holders of Common Stock Purchase Warrants are urged to obtain current
market quotations for the Common Stock Purchase Warrants.
The Common Stock Purchase Warrants are not entitled to dividends.
Special Common Stock Warrant. The Special Common Stock Warrant is owned by a
single holder. No price quotations are available for the Special Common Stock
Warrant. The Special Common Stock Warrant is not entitled to dividends.
7. Certain Information Concerning the Company.
The Company. The information concerning the Company contained in this Offer
to Purchase, including financial information, has been taken from or is based
upon publicly available documents and records on file with the Commission and
other public sources. Neither Parent nor the Purchaser assumes any
responsibility for the accuracy or completeness of the information concerning
the Company contained in such documents and records or for any failure by the
Company to disclose events which may have occurred or may affect the
significance or accuracy of any such information but which are unknown to
Parent or the Purchaser.
The Company provides information technology services and solutions to
enhance the ability of its customers to operate efficiently and more cost
effectively through common operating environments, common support
environments, specialized solutions and the Internet. These services and
solutions include network and desktop computing infrastructure design,
integration, security and management, help desk support, maintenance, warranty
support, procurement, resale and installation of information technology and
communications equipment, application software design and support, and
standardized and customizable solutions encompassing customer
13
<PAGE>
delivery channels for financial services institutions, electronic commerce and
Internet-based commercial applications. The Company provides these services
and solutions to customers on six continents and in major markets around the
world. The Company's customers include banking and other financial services
institutions, insurance companies, governments and their affiliates, including
the governments of the United States, Italy, and the European Commission,
public authorities and utilities, and commercial enterprises in the retail,
oil and gas, computer and telecommunications sectors. The Company has
approximately 20,300 employees in 45 countries of which approximately 15,500
have technical skills. The address of the Company's principal executive
offices is 290 Concord Road, Billerica, Massachusetts 01821. The telephone
number of the Company at such offices is (978) 625-5000.
Capital Structure. The authorized capital of the Company consists of (i) the
Common Stock and (ii) preferred stock designated as the Series A Preferred
Stock, the Series B Preferred Stock and Series C Junior Participating
Preferred Stock (the "Series C Preferred Stock").
(a) Common Stock
Each share of Common Stock is entitled to one vote. The Common Stock ranks
junior to the Series A Preferred Stock and the Series B Preferred Stock with
respect to dividends and rights on liquidation, winding up and dissolution.
(b) Rights
In accordance with the Rights Agreement, on April 22, 1998, the Board of
Directors authorized and declared a dividend distribution of one Right for
each share of Common Stock outstanding at the close of business on May 1,
1998, and has authorized the issuance of one Right for each share of Common
Stock of the Company issued between May 1, 1998 and the Distribution Date (as
defined below). Each Right entitles the holder to purchase from the Company
1/1000th of a share of Series C Preferred Stock at a price of $120 per
1/1000th of a share of Series C Preferred Stock, subject to adjustment.
Currently, the Rights are evidenced by the certificates for Common Stock
registered in the names of the holders of Common Stock (which certificates
shall be deemed also to be certificates for Rights) and not by Rights
Certificates, and the Rights will be transferable only in connection with the
transfer of the underlying shares of Common Stock of the Company (including a
transfer to the Company).
The Rights become exercisable upon the close of business on the tenth day
following the earlier to occur of (i) a public announcement that a person or a
group of affiliated persons other than (a) the Company, (b) any subsidiary of
the Company, (c) any employee benefit plan of the Company or its subsidiary or
an entity established pursuant to the terms of such plan, (d) any person whose
interest in the Company rises to 15% or more solely because of a repurchase of
shares of Common Stock by the Company or (e) any person who certifies to the
Company that shares in excess of 14.9% were acquired inadvertently or without
knowledge of the terms of the Rights and who does not thereafter acquire
additional shares of Common Stock while the beneficial owner of 15% or more of
shares of Common Stock, has acquired or obtained rights to acquire beneficial
ownership of 15% or more of shares of Common Stock then outstanding (such
person, an "Acquiring Person") or (ii) the commencement of or public
announcement of the intention to make a tender or exchange offer by a person
who, upon consummation thereof, would become an Acquiring Person (the
"Distribution Date"). The Purchaser has been advised by the Company that the
Company and the Board of Directors have taken all necessary action to render
the Rights Agreement inapplicable with respect to the Offer and the Merger.
At any time prior to the Distribution Date, the Company may redeem the
Rights, in whole but not in part, for $0.01 per Right. The Rights will expire
at the close of business on April 22, 2008, if not redeemed by the Company at
an earlier date.
No holder, as such, of any Rights Certificate shall be entitled to vote,
receive dividends or be deemed for any purpose the holder of the number of
1/1000th of a share of Series C Preferred Stock or any other securities of the
Company which may at any time be issuable on the exercise of the Rights
represented thereby, nor shall
14
<PAGE>
anything contained in the Rights Agreement or in any Rights Certificate be
construed to confer upon the holder of any Rights Certificate, as such, any of
the rights of a stockholder of the Company or any right to vote for the
election of directors or upon any matter submitted to stockholders at any
meeting thereof, or to give or withhold consent to any corporate action, or to
receive notice of meetings or other actions affecting stockholders, or to
receive dividends or subscription rights, or otherwise, until the Right or
Rights evidenced by such Rights Certificate shall have been exercised in
accordance with the provisions of the Rights Agreement.
(c) Series A Preferred Stock
Each share of Series A Preferred Stock is entitled to one vote and votes
together as one class with the holders of Common Stock and Series B Preferred
Stock. The Series A Preferred Stock ranks senior to the Common Stock and
Series B Preferred Stock with respect to dividends and rights on liquidation,
winding up and dissolution. The holders of Series A Preferred Stock are
entitled to cumulative cash dividends in the amount of $45.00 per share per
annum, payable quarterly in arrears. If six quarterly dividends have not been
declared and paid or set apart for payment, whether or not consecutive, the
number of directors constituting the Board of Directors shall be increased by
two and the holders of the Series A Preferred Stock, voting separately as a
class, will be entitled to elect such additional directors.
In the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company, the holders of the outstanding Series A Preferred
Stock have a liquidation preference of $1,000 per share, plus accrued and
unpaid dividends. Neither a consolidation or merger of the Company with
another corporation nor a sale or transfer of all or substantially all of the
Company's assets will be considered a liquidation, dissolution or winding up
of the Company.
Each share of Series A Preferred Stock is convertible, at any time, at the
option of the holder thereof, and without the payment of additional
consideration, into such number of shares of Common Stock as is determined by
dividing $1,000 by the initial conversion price of $23.00. The conversion
price may be adjusted from time to time pursuant to the terms of the
certificate of designation of the Series A Preferred Stock. The Purchaser has
been advised by the Company that the initial conversion price for the Series A
Preferred Stock has not been adjusted. The holders of the 90,000 issued and
outstanding shares of Series A Preferred Stock would, upon conversion, be
entitled to receive an aggregate number of 3,913,043 shares of Common Stock.
In the event of a merger or consolidation in which the holders of the
Company's issued and outstanding Common Stock immediately prior to the
effective date of such merger or consolidation will not hold at least 50% of
the outstanding voting securities of the surviving corporation, each share of
Series A Preferred Stock shall, immediately prior to the merger or
consolidation, be mandatorily converted into shares of Common Stock, at the
then applicable conversion price. The Merger would be such an event.
The Company is obligated to redeem all Series A Preferred Stock, with cash
or Common Stock, by October 1, 2003 or within 180 days of the receipt by the
Company of a written notice delivered by the holders thereof on or after May
30, 2002. The redemption price shall be $1,000 per share, subject to certain
adjustments from time to time. The Company has advised the Purchaser that the
redemption price of the Series A Preferred Stock has not been adjusted.
(d) Series B Preferred Stock
Each share of Series B Preferred Stock is entitled to one vote and votes
together as one class with the holders of Common Stock and Series A Preferred
Stock. Series B Preferred Stock ranks senior to the Common Stock of the
Company and junior to Series A Preferred Stock with respect to dividends and
rights on liquidation, winding up and dissolution. Subject to the rights of
the holders of Series A Preferred Stock, the holders of Series B Preferred
Stock are entitled to cumulative cash dividends equal to $65.00 per share per
annum payable quarterly in arrears. If six quarterly dividends have not been
declared and paid or set apart for payment, whether or not consecutive, the
number of directors constituting the Board of Directors of the Company shall
be increased by two and the holders of the Series B Preferred Stock, voting
separately as a class, will be entitled to elect such additional directors.
15
<PAGE>
In the event of any voluntary or involuntary liquidation, dissolution or
winding up of the Company, the holders of the Series B Preferred Stock have a
liquidation preference, subject to the liquidation preference of the holders
of the Series A Preferred Stock, of $1,000 per share, plus accrued and unpaid
dividends. Neither a consolidation or merger of the Company with another
corporation nor a sale or transfer of all or substantially all of the
Company's assets will be considered a liquidation, dissolution or winding up
of the Company.
Each share of Series B Preferred Stock is convertible, at the sole option of
its holder, into such number of shares of Common Stock as is determined by
dividing $1,000 by the initial conversion price of $26.5625. The conversion
price may be adjusted from time to time pursuant to the terms of the
certificate of designation of the Series B Preferred Stock. The Purchaser has
been advised by the Company that the initial conversion price for the Series B
Preferred Stock has not been adjusted. The holders of the 143,750 shares of
Series B Preferred Stock would, upon conversion, be entitled to an aggregate
number of 5,411,765 shares of Common Stock. In any merger, consolidation, sale
of substantially all of the Company's assets or reclassification or
recapitalization of the Common Stock in which the shares of Common Stock are
converted into the right to receive stock, other securities or other property
(including cash or any combination thereof), each share of Series B Preferred
Stock which is not converted into the right to receive stock, securities or
other property with respect to such transaction shall thereafter be
convertible into the kind and amount of shares of stock, other securities or
property receivable (including cash and any combination thereof) upon the
consummation of such transaction, at the election of a holder of that number
of shares or fraction thereof of Common Stock into which one share of Series B
Preferred Stock was convertible immediately prior to such merger,
consolidation, sale of assets or reclassification or recapitalization. The
Company shall not agree to a merger, consolidation, sale of assets or
reclassification or recapitalization unless such transaction is in accordance
with the rights of the holders of Series B Preferred Stock mentioned above and
until it has entered into an agreement with the successor or purchasing entity
for the benefit of the holders of Series B Preferred Stock that contains
provisions allowing holders of Series B Preferred Stock to convert such stock
into the consideration received by holders of Common Stock at the conversion
price in effect immediately prior to the merger.
The Company may, at its option, redeem the Series B Preferred Stock, in
whole or in part, during the twelve-month periods beginning on March 1, 1999,
March 1, 2000 and March 1, 2001 at a redemption price of $1,030, $1,020 and
$1,010, respectively per share of Series B Preferred Stock, plus all accrued
and unpaid dividends. After March 1, 2002, the redemption price per share of
Series B Preferred Stock is $1,000 plus all accrued and unpaid dividends.
All of the shares of Series B Preferred Stock are deposited with ASTT under
a Deposit Agreement dated as of February 27, 1996, by and among the Company,
ASTT, as depositary and the holders of depositary receipts pursuant to which
depositary receipts (the "Depositary Receipts") evidencing Depositary Shares
are issued. Each holder of a Depositary Receipt is entitled, proportionately,
to all the rights and preferences of, and subject to all of the limitations
of, the interest in the Series B Preferred Stock represented thereby
(including rights and preferences with respect to dividends, voting,
conversion, redemption and liquidation).
(e) Common Stock Purchase Warrants
Each Common Stock Purchase Warrant entitles its holder to purchase one share
of Common Stock at an initial exercise price of $21.45 per share of Common
Stock as may be adjusted from time to time. The Purchaser has been advised by
the Company that the initial exercise price for each Common Stock Purchase
Warrant has not been adjusted. The Common Stock Purchase Warrants expire on
July 2, 2001. Upon a merger of the Company into another entity, the Company or
the surviving entity shall execute with the warrant agent an agreement which
gives the holder the right upon payment of the exercise price in effect
immediately prior to such merger to purchase upon exercise of each Common
Stock Purchase Warrant the kind of shares and other securities and property
which such holder would have been entitled to receive upon consummation of
such merger had such Common Stock Purchase Warrant been exercised immediately
prior to such action.
16
<PAGE>
(f) Special Common Stock Warrant
On February 27, 1998, the Company issued one warrant which entitles the
holder to purchase 1,000,000 shares of Common Stock at the initial purchase
price of $23.00 per share, as adjusted from time to time, on or before the
effective date of the Merger. The Purchaser has been advised by the Company
that the initial purchase price has not been adjusted.
The Special Common Stock Warrant may be exercised by the holder thereof in
whole or in part. The holder shall pay the purchase price payable upon
exercise of the Special Common Stock Warrant by canceling a portion of the
Special Common Stock Warrant whose fair market value equals the aggregate
purchase price payable upon such exercise, as follows: upon exercise, the
number of shares of Common Stock to be issued to the holder shall equal (i)
the difference between the fair market value per share of Common Stock as of
the effective date of exercise minus the purchase price per share, (ii)
multiplied by the number of shares of Common Stock with respect to which the
Special Common Stock Warrant is exercised (iii) divided by the fair market
value per share of Common Stock as of the exercise date.
Upon any capital reorganization or reclassification of Common Stock (other
than a change in par value or a subdivision or combination of such Common
Stock), the holder of the Special Common Stock Warrant shall have the right to
receive upon exercise of the Special Common Stock Warrant the kind and amount
of shares of stock or other securities or property which the holder would have
been entitled to receive if, immediately prior to any such reorganization or
reclassification, the holder had held the number of shares of Common Stock
which were then purchasable upon the exercise of the Special Common Stock
Warrant.
Financial Information. Set forth below is certain selected consolidated
financial information relating to the Company and its subsidiaries which has
been excerpted or derived from the financial statements contained in the
Company's Annual Reports on Form 10-K for the transition period from July 1,
1998 to December 31, 1998 and for the fiscal years ended June 30, 1998, and
June 30, 1997. More comprehensive financial information is included in these
reports and other documents filed by the Company with the Commission. The
financial information that follows is qualified in its entirety by reference
to these reports and other documents, including the financial statements and
related notes contained therein. These reports and other documents may be
inspected at, and copies may be obtained from, the same places and in the
manner set forth below under "Available Information".
17
<PAGE>
WANG LABORATORIES, INC.
SELECTED CONSOLIDATED FINANCIAL DATA
<TABLE>
<CAPTION>
Six Months Ended Year Ended Year Ended Year Ended
December 31, June 30, June 30, June 30,
1998 1998(1) 1997(1) 1996(1)
---------------- ---------- ---------- ----------
($ in millions except per share data)
<S> <C> <C> <C> <C>
Income Statement Data:
Revenues.................... $1,818.0 $1,887.0 $1,268.4 $1,013.9
Income (loss) from
continuing operations
before discontinued
operations................. (39.8) (251.6) (6.7) 63.5
Income (loss) from
discontinued operations.... -- -- 76.6 (69.0)
Net income (loss)........... (39.8) (251.6) 69.9 (5.5)
Dividends and accretion on
preferred stock............ (7.0) (14.1) (14.1) (22.6)
Net income (loss) applicable
to common holders.......... $ (46.8) $ (265.7) $ 55.8 $ (28.1)
Net income (loss) per share:
Basic
Continuing operations... $ (1.01) $ (6.54) $ (0.56) $ 1.13
Discontinued
operations............. -- -- 2.06 (1.91)
-------- -------- -------- --------
Net Income (loss)........... $ (1.01) $ (6.54) $ 1.50 $ (0.78)
Diluted
Continuing operations... $ (1.01) $ (6.54) $ (0.56) $ 1.07
Discontinued
operations............. -- -- 2.06 (1.81)
-------- -------- -------- --------
Net Income (loss)........... $ (1.01) $ (6.54) $ 1.50 $ (0.74)
Balance Sheet Data (at
period end):
Total assets................ $2,369.8 $2,249.4 $1,034.8 $ 856.6
Depreciable assets, net..... 236.0 214.1 123.0 137.3
Working capital............. 100.6 50.1 126.1 86.7
Long-term debt, excluding
liabilities subject to
compromise................. 250.7 116.9 -- --
Series A Preferred Stock.... 86.5 86.2 85.5 84.8
Stockholders' equity
(deficit).................. 348.2 382.5 422.8 343.1
</TABLE>
- --------
(1) Certain prior years' amounts have been reclassified to conform to the
presentation for the six months ended December 31, 1998.
Recent Developments. On May 4, 1999, the Company reported revenues for the
first quarter ending March 31, 1999 of $789.0 million and EBITDA of $52.2
million. The Company reported a net loss for the quarter of $57.7 million or a
loss of $1.25 per share. During the quarter, the Company recorded
restructuring charges and integration-related period costs of $51.5 million.
The Company ended the period with consolidated cash balances of $182.0 million
and total debt of $346.0 million.
Available Information. The Company is subject to the information and
reporting requirements of the Exchange Act and is required to file reports and
other information with the Commission relating to its business, financial
condition and other matters. Information, as of particular dates, concerning
the Company's directors and officers, their remuneration, stock options
granted to them, the principal holders of the Company's securities, any
material interests of such persons in transactions with the Company and other
matters is required to be disclosed in reports filed with the Commission.
These reports and other information should be available for inspection at the
public reference facilities of the Commission located in Judiciary Plaza, 450
Fifth Street, N.W., Washington, D.C. 20549, and also should be available for
inspection and copying at prescribed rates at regional offices of the
Commission located at Seven World Trade Center, New York, New York 10048 and
500 West Madison Street, Suite 1400, Chicago, Illinois 60661. Copies of this
material may also be obtained by mail, upon payment of the Commission's
customary fees, from the Commission's principal office at 450 Fifth Street,
N.W., Washington, D.C. 20549. Electronic filings filed through the
Commission's Electronic Data Gathering, Analysis and Retrieval system
("EDGAR"), including those made by or in respect of the Company, are publicly
available through the Commission's home page on the Internet at
http://www.sec.gov.
18
<PAGE>
Certain Financial Projections for the Company. Prior to entering into the
Merger Agreement, Parent conducted a due diligence review of the Company and
in connection with such review received certain non-public information
provided by the Company, including certain projected financial information
(the "Projections") for the fiscal year ending December 31, 1999. The Company
does not in the ordinary course publicly disclose projections and the
Projections were not prepared with a view to public disclosure. The Company
has advised Parent and the Purchaser that the Projections were prepared by the
Company's management based on numerous assumptions including, among others,
projections of revenues, gross profit, operating and other expenses,
depreciation and amortization, capital expenditure and working capital
requirements. The Projections do not give effect to the Offer or the potential
combined operations of Parent and the Company. Such information is set forth
below in this Offer to Purchase for the limited purpose of giving the holders
of the Offer Securities access to financial projections prepared by the
Company's management that were made available to Parent and the Purchaser in
connection with the Merger Agreement and the Offer.
19
<PAGE>
WANG LABORATORIES, INC.
PROJECTED FINANCIAL PERFORMANCE
<TABLE>
<CAPTION>
First Second Third Fourth Calendar
Quarter Quarter Quarter Quarter Year
1999 1999 1999 1999 1999
------- ------- ------- ------- --------
($ in millions)
<S> <C> <C> <C> <C> <C>
Income Statement Data:
Consolidated Total Revenue.......... 768.7 840.7 829.6 990.8 3,429.7
Services Revenue.................... 482.0 529.0 535.0 596.0 2,141.9
EBITA(/1/).......................... 20.5 44.3 46.2 80.7 191.7
Operating Cash Flow................. (66.3) 4.9 5.2 50.0 (6.2)
</TABLE>
- --------
(/1/)EBITA means earnings before interest, income taxes and amortization from
continuing operations, calculated by adjusting the loss from operations
for non-recurring charges, amortization expense and other income.
CAUTIONARY STATEMENTS CONCERNING FORWARD-LOOKING STATEMENTS
Certain matters discussed herein are forward-looking statements that involve
risks and uncertainties. Forward-looking statements include the information
set forth above in "Certain Financial Projections for the Company".
While presented with numerical specificity, the Projections were prepared by
the Company in the ordinary course and are based upon a variety of estimates
and hypothetical assumptions which may not be accurate, may not be realized,
and are also inherently subject to significant business, economic and
competitive uncertainties and contingencies, all of which are difficult to
predict, and most of which are beyond the control of the Company. Accordingly,
there can be no assurance that any of the Projections will be realized and the
actual results for the fiscal year 1999 may vary materially from those shown
above.
In addition, the Projections were not prepared in accordance with generally
accepted accounting principles, and neither the Company's nor Parent's
independent accountants have examined or compiled any of the Projections or
expressed any conclusion or provided any other form of assurance with respect
to the Projections and accordingly assume no responsibility for the
Projections. The Projections were prepared with a limited degree of precision,
and were not prepared with a view to public disclosure or compliance with the
published guidelines of the Commission or the guidelines established by the
American Institute of Certified Public Accountants regarding projections,
which would require a more complete presentation of data than as shown above.
The inclusion of the Projections herein should not be regarded as a
representation by Parent and the Purchaser or any other person that the
projected results will be achieved. The Projections should be read in
conjunction with the historical financial information of the Company included
above. None of Parent, the Purchaser or any other person assumes any
responsibility for the accuracy or validity of the foregoing Projections.
Forward-looking statements also include those preceded by, followed by or that
include the words "believes", "expects", "anticipates" or similar expressions.
Such statements should be viewed with caution.
8. Certain Information Concerning the Purchaser and Parent.
The Purchaser. The Purchaser, a newly incorporated Delaware corporation, has
not conducted any business other than in connection with the Offer and the
Merger Agreement. All of the issued and outstanding shares of capital stock of
the Purchaser are beneficially owned by Parent. The principal address of the
Purchaser is 1013 Centre Road, Wilmington, Delaware 19805. The telephone
number of the Purchaser at such office is (800) 927-9800.
Parent. Parent is a public company with limited liability incorporated under
the laws of The Netherlands with its corporate seat in Amsterdam, The
Netherlands. Parent provides information and communication technology services
in The Netherlands, various other European countries, the United States and
Mexico. Parent's common shares are listed on the AEX-Stock Exchange (formerly
known as the Amsterdam Stock Exchange). The principal executive offices of
Parent are located at Donauweg 10, 1043 AJ Amsterdam, P.O. Box 652, 1000 AR
Amsterdam, The Netherlands. The telephone number of Parent at such offices is
011-31-20-586-1412 (Investor Relations Department).
20
<PAGE>
Financial Information. Parent is not subject to the informational and
reporting requirements of the Exchange Act and is not required to file reports
and other information with the Commission relating to its businesses,
financial condition or other matters. Set forth below are certain selected
consolidated financial data with respect to Parent and its consolidated
subsidiaries for Parent's last three fiscal years (collectively, the "Parent
Financial Statements"). The Parent Financial Statements have been extracted or
derived from the 1998 audited consolidated financial statements of Parent (the
"1998 Consolidated Statements"). The 1998 Consolidated Statements have been
filed with the Commission as an exhibit to the Purchaser's Tender Offer
Statement on Schedule 14D-1 (the "Schedule 14D-1") relating to this Offer, and
the summary below is qualified by reference to such report, which may be
inspected and obtained at the office of the Commission as set forth in Section
7--"Certain Information Concerning the Company". All the financial information
and related notes contained therein are incorporated herein by reference.
The Parent Financial Statements are presented in Dutch Guilders ("Guilders"
or "NLG") and are prepared in accordance with accounting principles generally
accepted in The Netherlands ("Dutch GAAP"). As of each of December 31, 1996,
December 31, 1997, December 31, 1998 and May 7, 1999, the rate in New York
City for cable transfers in foreign currencies as certified for custom
purposes by the Federal Reserve Bank of New York (the "Noon Buying Rate"), was
NGL 1.73 = U.S. $1.00, NGL 2.03 = U.S. $1.00, NGL 1.88 = U.S. $1.00 and NGL
2.20 = U.S. $1.00, respectively.
21
<PAGE>
GETRONICS NV
SELECTED CONSOLIDATED FINANCIAL DATA
<TABLE>
<CAPTION>
Fiscal year
-----------------------------------------------------------
1998(/3/) 1997(/4/) 1996
----------------- ----------------- -----------------
(in millions of Guilders, except per share amounts)
<S> <C> <C> <C>
Consolidated Earnings
Data
Net sales............. 3,459.2 2,776.5 2,210.7
Added value........... 1,647.6 1,237.9 1,029.1
Operating result...... 319.3 236.5 181.3
Group earnings before
taxes................ 326.6 251.2 200.1
Net profit............ 240.2 180.0 131.6
Cash flow(/1/)........ 291.5 212.9 179.4
Balance Sheet Data
Capital employed...... 524.2 286.8 331.1
Group equity.......... 383.8 154.2 260.2
Market capitalization
as at December 31.... 8,374.0 5,662.0 4,075.0
Data per ordinary share
of NLG 0.25 nominal
value
Net earnings(/1/)..... 2.69 2.06 1.52
Cash flow(/1/),(/2/).. 3.26 2.44 2.08
Shareholders' equity.. 4.04 1.65 2.94
<CAPTION>
December 31, December 31, December 31,
1998 1997 1996
----------------- ----------------- -----------------
(in millions of Guilders)
<S> <C> <C> <C>
Consolidated Balance
Sheet Data
Total assets.......... 1,392.3 1,024.5 986.6
Long-term borrowings.. 22.3 11.5 3.1
Shareholders' equity.. 364.1 144.9 255.2
</TABLE>
- --------
(1) Cash flow is defined as the total of net earnings (excluding extraordinary
income), depreciation of tangible fixed assets and minority interests. The
figures for 1997 have been adjusted by excluding extraordinary income to
facilitate comparison.
(2) On the basis of the average number of shares outstanding. The figures for
1997 have been adjusted by excluding extraordinary income to facilitate
comparison.
(3) With effect from July 1, 1998, the financial data of Grupo CP and IBM ASAP
have been included in the consolidation.
(4) With effect from October 1, 1997, the financial data of ARK ASA has been
included in the consolidation and with effect from January 1, 1997 the
financial data of RAET N.V. has been included in the consolidation.
Differences between Dutch GAAP and U.S. GAAP
The differences between Dutch GAAP and United States generally accepted
accounting principles ("U.S. GAAP") which materially affect Parent's reported
net earnings and shareholders' equity are explained below.
Goodwill: Under Dutch GAAP, the amount of goodwill included in the price of
acquired companies (and minority interests when applicable) is deducted from
shareholders' equity in the year of acquisition. Under U.S. GAAP, goodwill is
capitalized and amortized over the estimated life, not to exceed 40 years.
Deferred income tax assets have not been valued. Since the deferred income tax
assets of Parent mainly relate to acquired goodwill, the capitalization of
deferred income taxes would have an effect on the shareholders' equity and the
tax charge. Under U.S. GAAP, deferred income tax assets are recognized fully
and a provision is made for valuation allowance if recovery is less than
likely.
Pension Cost: Under Dutch GAAP, pension costs are based on actuarial
computed contributions to foundations. Liabilities for past service
obligations should be recorded. Under U.S. GAAP, pension costs are computed in
accordance with the provisions of Statement of Financial Accounting Standard
No. 87, "Employer's Accounting for Pensions" and include current service
costs, interest costs and amortization of prior service costs.
Millennium Provision: Under Dutch GAAP, a provision is allowed to provide
for millennium costs. Under U.S. GAAP, it is not allowed to provide for a
millennium provision, given the restrictions to the definition of provisions
under U.S. GAAP.
22
<PAGE>
Dividends: Under Dutch GAAP, it is appropriate to record a liability for a
cash dividend prior to approval thereof by the annual general meeting of
shareholders. Under U.S. GAAP, it is not appropriate to record a liability for
dividends/distribution to shareholders subject to approval of the annual
general meeting of shareholders.
Extraordinary Results: Under Dutch GAAP, items that are defined as revenues
and expenses not arising from the ordinary course of business may be accounted
for as extraordinary items. Under U.S. GAAP, such items would be recorded in
income from operations.
Earnings Per Share: Under Dutch GAAP, the disclosure of earnings per share
("EPS") is allowed without taking into account a fully diluted EPS
calculation. Under U.S. GAAP, the use of weighted average potential dilutive
shares, as denominator for diluted EPS, is required.
Main Accounting Principles Applied by Parent
Income Statement Data: Net sales reflect proceeds from goods and services
provided to third parties during the year under review. Projects are included
in net sales at the moment of final delivery. The cost of sales is the average
of the historical cost of the goods and services purchased from third parties.
Differences in exchange rates as well as allocations to the provision for
obsolescence are included. The balance of interest income and expense is
presented in the income statement. Income tax is calculated, on the basis of
the applicable tax rates, on the earnings before taxes, taking into account
exempt profit components. Timing differences resulting from determination of
the result for tax purposes are added to or deducted from the provision for
deferred taxes. Deferred tax debits have not been valued.
Balance Sheet Data: Tangible fixed assets are valued at cost less
accumulated depreciation. Depreciation is calculated according to the
straight-line method, based on the estimated useful lives. Where the company
has a significant influence on financial and business policies, non-
consolidated investments are stated at net asset value. Other investments are
stated at cost, taking account of a lasting impairment in value. Inventories
are valued at the lower of average cost and marked price, taking into account
a normal realizable margin, reduced by provisions for obsolescence. Work-in-
progress is valued on the basis of materials used and labor costs less
anticipated losses determined on a project basis and installments billed in
advance. Securities are valued at the lower of acquisition cost and stock
market value. Debentures are stated at nominal value, after adjustment for the
non-amortized part of the premium/discount. Amortization of the
premium/discount is on a straight-line basis for the remaining life to
maturity. Provisions are made for risks and liabilities related to operations.
Income from lease contracts is deferred and amortized over the lease term. A
provision is included for repurchase commitments for lease contracts above
residual value. Deferred tax liabilities resulting from timing differences in
the profit determination for the financial statements and for tax purposes are
stated at the tax rates prevailing in the country concerned. The warranty
provision is formed for providing additional services and to cover any
technical faults relating to goods and services provided. The pension
provision only concerns the past-service commitments with regard to pensions
and other non-activity plans, determined on an actuarial basis. The actuarial
interest rate used is 4%.
During the last five years, none of Parent, the Purchaser or to the best of
their knowledge, any of the persons listed in Schedule I hereto (i) has been
convicted in a criminal proceeding (excluding traffic violations and similar
misdemeanors) or (ii) was 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.
Except as described in this Offer to Purchase (i) none of Parent, the
Purchaser or to the best of their knowledge, any of the persons listed in
Schedule I to this Offer to Purchase or any associate or majority-owned
subsidiary of Parent, or the Purchaser beneficially owns or has any right to
acquire, directly or indirectly, any equity securities of the Company and (ii)
none of Parent, the Purchaser or to the best of their knowledge, any of the
persons or entities referred to above or any director, executive officer or
subsidiary of any of the foregoing has effected any transaction in such equity
securities during the past 60 days. The Purchaser and Parent disclaim
23
<PAGE>
beneficial ownership of any Offer Securities owned by any pension plans of
Parent or the Purchaser or any affiliate of Parent or the Purchaser.
Except as described in this Offer to Purchase, none of Parent, the Purchaser
or to the best of their knowledge, 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. Except as set forth in this Offer to Purchase, since July 1, 1995,
none of Parent, the Purchaser or to the best of their knowledge, any of the
persons listed on 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 July 1, 1995, there have been no contacts, negotiations or
transactions between any of Parent, the Purchaser or any of their subsidiaries
or, to the best knowledge of Parent, or the Purchaser, 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. Source and Amount of Funds. The Offer is not conditioned upon any
financing arrangements. The amount of funds required by the Purchaser to
purchase all of the outstanding Offer Securities pursuant to the Offer and to
pay related fees and expenses is expected to be approximately $1.82 billion.
The Purchaser intends to obtain such funds from Parent and/or one or more of
its affiliates, which will obtain such funds from cash on hand, proceeds from
a convertible preferred stock offering by Parent completed in April of 1999
and through a loan facility (the "Credit Facility") to be provided by ABN AMRO
Bank N.V. and ING Bank N.V. (the "Banks"). Parent has received a commitment
letter dated May 3, 1999 (the "Commitment Letter") from the Banks pursuant to
which the Banks have agreed to lend to Parent and/or one or more of its
affiliates up to NLG 4 billion for the Offer. The Credit Facility will expire
364 days after execution of the agreement evidencing the Credit Facility.
Borrowings under the Credit Facility will bear interest at the rate of
LIBOR/EURIBOR plus (i) 100 basis points per annum until September 30, 1999,
(ii) 125 basis points per annum from September 30, 1999 until December 31,
1999 and (iii) 125 basis points per annum from and after December 31, 1999,
unless the uncanceled amount of the Credit Facility as at close of business in
Amsterdam on December 31, 1999 is more than NLG 2 billion, in which case the
margin for such period will be 175 basis points per annum. Parent will use the
funds from the Credit Facility to finance the Purchaser, directly or
indirectly, through its affiliates.
Parent currently intends to refinance the Credit Facility through a combined
common stock and preferred stock equity offering prior to the end of 1999,
although no assurances can be given that such equity offering will occur.
The foregoing summary of the source and amount of funds is subject to the
preparation and completion of a definitive credit agreement for the Credit
Facility and is qualified in its entirety by reference to the text of the
Commitment Letter, a copy of which has been filed as an exhibit to the
Schedule 14D-1. The Commitment Letter may be inspected at, and copies may be
obtained from, the same places and in the manner set forth in Section 7--
"Certain Information Concerning the Company". If and when definitive
agreements relating to the Credit Facility are executed, copies will be filed
as exhibits to an amendment to the Schedule 14D-1.
The margin regulations promulgated by the Board of Governors of the Federal
Reserve System (the "Federal Reserve Board") place restrictions on the amount
of credit that may be extended for the purposes of purchasing margin stock,
including if such credit is secured directly or indirectly by margin stock.
The Purchaser believes that the financing of the acquisition of the Offer
Securities will be in full compliance with, or not subject to, the margin
regulations.
24
<PAGE>
10. Background of the Offer.
On November 13, 1998, Frans Kleipool, Director of Corporate Planning of
Parent, contacted Credit Suisse First Boston Corporation ("CSFB") in order to
arrange a meeting between Parent and the Company. Shortly thereafter, CSFB
informed Parent that Joseph M. Tucci, Chairman and Chief Executive Officer of
the Company, would be interested in exchanging views about a possible business
combination of the Company and Parent with A.H.J. Risseeuw, the then Chief
Executive Officer of Parent.
On December 18, 1998, Mr. Tucci was introduced by a representative of CSFB
to Mr. Risseeuw at a meeting of the three parties. Mr. Tucci and Mr. Risseeuw
generally discussed the business opportunities for both companies and agreed
to investigate further the possibilities of a business combination.
From late December 1998 to early February 1999, Jan Docter, the Chief
Financial Officer of Parent, and Franklyn A. Caine, then Chief Financial
Officer of the Company, separately had several telephone discussions with
representatives of CSFB relating to possible financial and financing
structures for the acquisition of the Company by Parent.
On February 17, 1999, Messrs. Kleipool and Docter, and Peter van Voorst, a
member of the executive board of Parent, met with representatives of CSFB and
Mr. Tucci to discuss the preliminary scope and timing of limited due diligence
reviews of the Company by Parent and of Parent by the Company.
On March 1, 1999, Mr. Van Voorst met with Kevin Roche, Vice President of
Service Planning of the Company, to discuss operational issues. Messrs. Docter
and Van Voorst and Cees van Luijk, the new Chief Executive Officer of Parent,
also met with Messrs. Tucci and Caine, Albert A. Notini, Executive Vice
President of the Company, and Jeremiah J.J. van Vuuren, President and Chief
Operating Officer, International, of the Company, to discuss operational and
business issues in connection with a possible business combination. Also on
March 1, 1999, the parties signed the Confidentiality Agreement (as defined
below).
On March 2, 1999, further talks were held between the senior management
teams of Parent and the Company. Each of the Company and Parent made a
presentation to the other party regarding its respective operations, market
positioning and financial profile. Issues related to a possible business
combination were discussed.
On March 14, 1999, Messrs. Tucci and Risseeuw had a telephone conversation
in which they further discussed certain issues related to a possible business
combination.
From March 20, 1999 through May 3, 1999, Parent's legal and financial
advisors, together with representatives of Parent, conducted legal and
financial due diligence investigations of the Company.
On March 21, 1999, Messrs. Tucci, Docter and Kleipool met to discuss the
general market trends in the systems integration industry. On March 22, 1999,
Messrs. Caine, Docter and Kleipool met to discuss the integration of
management control processes, procurement and business development. They also
agreed on a more definitive procedure and structure for the due diligence
process.
On March 31, 1999 and April 1, 1999, Mr. Tucci met with Mr. Van Luijk and
Mr. Hartgert Langman, Chairman of the Supervisory Board of Parent, to further
discuss issues regarding a possible business combination.
On April 9, 1999, Messrs. Van Vuuren, Docter and Van Voorst met in Amsterdam
to discuss the Company's operations in Europe.
On April 14, 1999, representatives of the Company and of Parent and their
legal advisors met to discuss the results of the due diligence findings. On
April 14 and 15, 1999, representatives of the Company and of Parent met to
review information regarding the Company's European operations.
On April 21 and 22, 1999, representatives of Parent and the Company met to
review information regarding the Company's United States operations.
25
<PAGE>
On April 23, 1999, Messrs. Van Luijk and Tucci met to discuss the terms of a
possible business combination. Mr. Van Luijk made a proposal to Mr. Tucci to
purchase all of the Common Stock and other securities of the Company for a
purchase price based on $29.25 per share of Common Stock, subject to certain
terms and conditions, including the negotiation of a mutually satisfactory
merger agreement.
On April 26, 1999, the supervisory board of Parent approved Mr. Van Luijk's
proposal to Mr. Tucci to acquire the Company, subject to a number of
additional conditions. Subsequent to the approval by the supervisory board,
Messrs. Van Luijk and Tucci had a telephone conversation in which they
discussed certain aspects of the conditions imposed on Parent's proposal by
Parent's supervisory board.
On April 27, 1999, Messrs. Van Luijk and Tucci had several telephone
conversations to further discuss the conditions imposed on Parent's proposal
by Parent's supervisory board.
On April 28, 1999, the Board of Directors of the Company met to discuss the
proposal of Parent, as communicated to Mr. Tucci by Mr. Van Luijk. After the
meeting, Mr. Tucci informed Mr. Van Luijk of the issues raised by the Board of
Directors of the Company with respect to Parent's proposal.
From April 22 to May 2, 1999, the parties and their legal counsel negotiated
the terms of the proposed merger.
On May 2, 1999, Parent was advised by Messrs. Tucci and Notini that the
Company's Board of Directors had on that day reviewed the terms of the
proposed merger agreement and had, subject to the satisfactory conclusion of
the negotiation of the proposed merger agreement, determined that the proposed
Offer and Merger are in the best interests of the Company and the Company's
holders of Offer Securities, approved the Offer and the Merger and recommended
acceptance of the Offer by the Company's stockholders.
Following the Company's Board of Directors meeting, the Merger Agreement was
finalized and executed by the parties on May 3, 1999. The Company and Parent
each announced the execution of the Merger Agreement in press releases issued
before the Nasdaq Stock Market's National Market and Amsterdam Exchanges,
respectively, opened on May 4, 1999.
11. Purpose of the Offer; Plans for the Company; Certain Agreements.
Purpose of the Offer. The purpose of the Offer is to enable Parent to
acquire the entire equity interest in the Company. Upon consummation of the
Merger, the surviving corporation will become an indirect wholly-owned
subsidiary of Parent.
Plans for the Company. Subject to certain matters described below, it is
currently expected that, initially following the Merger, the business and
operations of the Company will generally continue as it is currently being
conducted. Parent currently intends to cause the Company's operations to
continue to be run and managed by, amongst others, the Company's existing
executive officers. Parent will continue to evaluate all aspects of the
business, operations, capitalization and management of the Company during the
pendency of the Offer and after the consummation of the Offer and the Merger
and will take such further 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.
Parent is currently evaluating an acquisition structure pursuant to which,
prior to the purchase of any Offer Securities pursuant to the Offer, all of
the capital stock of the Purchaser will be transferred to a general
partnership formed pursuant to the laws of Delaware (the "General
Partnership"). The partners of the General Partnership will be a limited
liability company established pursuant to the laws of The Netherlands, all of
the interests of which will be held by Parent, and another limited liability
company also established pursuant to the laws of The Netherlands, all of the
interests of which will be held by a wholly-owned subsidiary of Parent.
Immediately following the Merger, the surviving corporation and all of its
subsidiaries organized under the laws of any of the states of the United
States (other than Wang Government Services, Inc. ("WGSI")) will be liquidated
and all of their respective assets will be assigned, conveyed and transferred
to, and all of their
26
<PAGE>
respective liabilities will be assumed by, the General Partnership. WGSI,
which has received facility security clearance from the Department of Defense
("DoD"), will remain a separate corporation, the shares of which will be
wholly-owned by the General Partnership. All work on classified government
contracts performed by other divisions or units of the Company will be
transferred to WGSI. WGSI plans to enter into a foreign ownership, control and
influence ("FOCI") mitigation arrangement with the Defense Security Service
("DSS") that will satisfy security requirements under Executive Order 12829 of
the National Industrial Security Program ("NISP"), by limiting Parent's
control over WGSI and access to classified information, but will permit WGSI
to perform classified contracts. Parent is currently also considering the
transfer of certain non-U.S. subsidiaries of the Company to other non-U.S.
affiliates of Parent.
Except as otherwise discussed in this Offer to Purchase, Parent has no
present plans or proposals that would result in any extraordinary corporate
transaction, such as a merger, reorganization, liquidation involving the
Company or any of its subsidiaries, or sale or transfer of a material amount
of assets of the Company or any of its subsidiaries or in any other material
changes to the Company's capitalization, dividend policy, corporate structure,
business or composition of the Board of Directors or the management of the
Company except that Parent intends to review the composition of the boards of
directors (or similar governing bodies) of the Company and its subsidiaries
and to cause the election to such boards of directors (or similar governing
bodies) of certain of its representatives.
Merger Agreement. The following is a summary of the material terms of the
Merger Agreement. The summary is qualified in its entirety by reference to the
Merger Agreement which is incorporated herein by reference and a copy of which
has been filed with the Commission as an exhibit to the Schedule 14D-1. The
Merger Agreement may be inspected at, and copies may be obtained from, the
same places and in the manner set forth in Section 7--"Certain Information
Concerning the Company".
The Offer. The Merger Agreement provides that the Purchaser will commence
the Offer and that the obligation of the Purchaser to consummate the Offer and
to accept for payment and to pay for any Offer Securities tendered pursuant to
the Offer shall be subject to only those conditions set forth herein. The
Purchaser may not amend or change any of the conditions set forth in Section
14 --"Conditions of the Offer" without the prior written consent of the
Company.
Pursuant to the terms of the Merger Agreement, the Company has consented to
the Offer and has represented that the Board of Directors has (i) determined
that each of the Offer and the Merger is fair to, and in the best interest of,
the holders of the Offer Securities and declared that the Offer and the Merger
are advisable, (ii) approved the Offer and the Merger in accordance with the
provisions of the DGCL and (iii) recommended that the holders of the Offer
Securities accept the Offer and tender the Offer Securities pursuant to the
Offer and that the holders of Common Stock, Series A Preferred Stock and
Series B Preferred Stock approve and adopt the Merger Agreement.
The Merger. The Merger Agreement provides that, subject to the terms and
conditions thereof, and in accordance with the DGCL, the Purchaser shall be
merged with and into the Company as soon as practicable following the
satisfaction or waiver of the conditions set forth in the Merger Agreement
(such date, the "Closing Date"), which conditions are described below.
Following the Merger, the separate corporate existence of the Purchaser will
cease and the Company will continue as the surviving corporation (the
"Surviving Corporation").
At the Effective Time, each issued and outstanding share of Common Stock
(including the associated Rights), each issued and outstanding share of Series
B Preferred Stock and each issued and outstanding Common Stock Purchase
Warrant (the Common Stock Purchase Warrants, the Common Stock and the Series B
Preferred Stock, collectively, the "Company Stock") (other than shares of
Company Stock held by any subsidiary of the Company or in the treasury of the
Company, or, directly or indirectly, by Parent, the Purchaser or any other
subsidiary of Parent, which shares of Company Stock will cease to be
outstanding and be canceled and retired and none of which shall receive any
payment with respect thereto, and other shares of Company Stock, if any, held
by holders who perfect their appraisal rights under the DGCL) will by virtue
of the Merger and without any
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action by the holders thereof, be converted into the right to receive, in the
case of the Common Stock, $29.25 in cash, be converted into the right to
receive, in the case of the Common Stock Purchase Warrants, $7.80 in cash, and
become convertible into the right to receive, in the case of Series B
Preferred Stock, $1,101.17 in cash (such amount, with respect to each such
share of Company Stock, the "Applicable Merger Consideration") payable to the
holder thereof, without interest thereon.
At the Effective Time, each issued and outstanding share of Series A
Preferred Stock, shall, without any action on the part of the holders thereof,
be converted into such number of fully paid and nonassessable shares of Common
Stock as is determined by dividing $1,000 by 23, such shares of Common Stock
thereafter to be converted into the right to receive $29.25 in cash, without
interest thereon.
At the Effective Time, the Special Common Stock Warrant shall, by virtue of
the Merger and without any action on the part of the holder thereof, expire.
At the Effective Time, the Stock Appreciation Right of Ing. C. Olivetti &
Co. S.p.A. (the "Olivetti Warrant"), dated March 17, 1998, shall, by virtue of
the Merger and without any action on the part of the holder thereof, become
exercisable for the kind and amount of shares of stock or other securities or
property which the holder would have been entitled to receive if, immediately
prior to the Effective Time, such holder had exercised the Olivetti Warrant
and the Company had elected to pay the amount due in Common Stock.
At the Effective Time, each share of common stock, par value $0.01 per
share, of the Purchaser then issued and outstanding will, by virtue of the
Merger and without any action on the part of the holder thereof, be converted
into one fully paid and non-assessable share of common stock, par value $0.01
per share, of the Surviving Corporation.
The Merger Agreement provides that the respective obligations of Parent and
the Purchaser, on the one hand, and the Company, on the other hand, to effect
the Merger are subject to the satisfaction or waiver (subject to applicable
law), at or prior to the Effective Time, of each of the following conditions:
(i) the Merger Agreement and the Merger shall have been approved and adopted
by holders of a majority of the Common Stock, the Series A Preferred Stock and
the Series B Preferred Stock (voting as one class, with each share of such
capital stock having one (1) vote); (ii) no preliminary or permanent
injunction or other order shall have been issued by any federal, state or
foreign governmental or regulatory agency, body or authority and be in effect
at the Effective Time which prohibits, restrains, enjoins or restricts the
consummation of the Merger; provided, however, that, in the case of a decree,
injunction or other order, each of the parties to the Merger Agreement shall
have used reasonable best efforts to prevent the entry of any such injunction
or other order and to appeal as promptly as possible any decree, injunction or
other order that may have been rendered; (iii) no federal, state or foreign
statute, rule, regulation, executive order, decree or order of any kind shall
have been enacted, entered, promulgated or enforced by any court or
governmental authority which prohibits, restrains, enjoins or restricts the
Merger or has the effect of making the Merger illegal; and (iv) the Purchaser
shall have purchased shares of Offer Securities pursuant to the Offer in a
number sufficient to satisfy the Minimum Condition.
Directors and Officers of the Surviving Corporation. The Merger Agreement
provides that, at the Effective Time, the directors of the Purchaser
immediately prior to the Effective Time shall be the directors of the
Surviving Corporation, each of such directors to hold office, subject to the
applicable provisions of the certificate of incorporation and by-laws of the
Surviving Corporation, until the next annual stockholders' meeting of the
Surviving Corporation and until their respective successors shall be duly
elected or appointed and qualified. At the Effective Time, the officers of the
Company immediately prior to the Effective Time shall, subject to the
applicable provisions of the certificate of incorporation and by-laws of the
Surviving Corporation, be the officers of the Surviving Corporation until
their respective successors shall be duly elected or appointed and qualified.
Company Stockholders' Meeting. Pursuant to the Merger Agreement, promptly
following the purchase of the Offer Securities pursuant to the Offer, if
required by law in order to consummate the Merger, the Company,
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acting through its Board of Directors, shall, in accordance with applicable
law, (i) duly call, convene and hold a meeting of the stockholders of the
Company (the "Stockholders' Meeting") for the purpose of voting upon the
Merger Agreement and the Merger and (ii) take all action necessary and
advisable to secure the vote of stockholders required by applicable law and
the Company's certificate of incorporation or the Company's by-laws to obtain
the approval for the Merger Agreement and the Merger. The Company has agreed
that it shall include in the proxy statement or information statement required
in connection with the Stockholders' Meeting (the "Proxy Statement") the
recommendation of its Board of Directors that the stockholders of the Company
approve and adopt the Merger Agreement and approve the Merger. Parent shall
cause all shares of capital stock of the Company owned by Parent and its
direct and indirect subsidiaries (including the Purchaser) to be voted in
favor of the Merger and the Merger Agreement.
Interim Operations. The Merger Agreement provides that the Company agrees
that, except as permitted, required or specifically contemplated by, or
otherwise described in, the Merger Agreement or otherwise consented to or
approved in writing by Parent, during the period commencing on May 3, 1999
until such time as nominees of Parent shall comprise more than half of the
members of the Board of Directors of the Company or the Merger Agreement shall
have been terminated pursuant to its termination provisions, each of the
Company and its subsidiaries will conduct its operations only according to its
ordinary and usual course of business consistent with past practice and use
its reasonable best efforts to preserve intact its respective business
organization, keep available the services of its officers and employees and
maintain satisfactory relationships with licensors, suppliers, distributors,
clients, joint venture partners and others having significant business
relationships with them and the Company shall not, and shall cause each of its
subsidiaries not to (i) amend its certificate of incorporation or its by-laws
(or comparable governing documents), (ii) except (A) upon the exercise of
Options, Common Stock Purchase Warrants or the Special Common Stock Warrant,
(B) upon the conversion of the Series A Preferred Stock or Series B Preferred
Stock and (C) pursuant to the terms of the Ancillary Consideration Agreement,
dated as of March 17, 1998, by and between the Company and Olivetti (the
"Olivetti Agreement"), issue or sell, or authorize to issue or sell, any
shares of its capital stock or any other securities, or issue or sell, or
authorize to issue or sell, any securities convertible into, or options,
warrants or rights to purchase or subscribe to, or enter into any arrangement
or contract with respect to the issuance or sale of, any shares of its capital
stock or any other securities, or make any other changes in its capital
structure; (iii) sell or pledge or agree to sell or pledge any stock or other
equity interest owned by it in any other person except to the extent required
to be pledged to the collateral agent under the Credit Facility, (iv) except
in the case of the Company's wholly-owned subsidiaries, in the ordinary course
of business consistent with past practice, declare, pay or set aside any
dividend (other than dividends on the Series A Preferred Stock or Series B
Preferred Stock in accordance with the terms of their respective Certificates
of Designation) or other distribution or payment with respect to, or split,
combine, redeem or reclassify, or purchase or otherwise acquire, any shares of
its capital stock, (v) enter into any contract or commitment with respect to
capital expenditures with a value in excess of, or requiring expenditures by
the Company and its subsidiaries in excess of, $10 million, individually, or
enter into contracts or commitments with respect to capital expenditures in
excess in the aggregate of those provided for in the Company's calendar year
1999 Plan (the "Plan"); (vi) acquire, by merging or consolidating with, by
purchasing an equity interest in or a portion of the assets of, or by any
other manner, any material business or any person, or otherwise acquire any
assets of any person (other than (A) the purchase of assets in the ordinary
course of business and consistent with past practice, (B) intercompany
transactions and (C) acquisitions which in the aggregate do not exceed $10
million), (vii) except in the ordinary course of business consistent with the
Plan, including without limitation the implementation of the Company's job
structures and broad banding program and its various variable compensation
programs (including its management incentives and sales compensation plans),
and except to the extent required under benefit plans, agreements, collective
bargaining agreements or their arrangements as in effect on the date of the
Merger Agreement or applicable law, rule or regulation, increase materially
the compensation or fringe benefits of any of its directors, officers or
employees or grant any severance or termination pay or enter into any
employment, consulting or severance agreement or arrangement with any present
or former director, officer or other employee of the Company or any of its
subsidiaries, or establish, adopt, enter into or, except in connection with
the merger of various plans which will not materially increase the benefits
payable thereunder, amend or terminate any collective bargaining, bonus,
profit sharing, thrift,
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compensation, stock option, restricted stock, pension, retirement, deferred
compensation, employment, termination, severance or other plan, agreement,
trust, fund, policy or arrangement for the benefit of any directors, officers
or employees; provided, however, the Company may enter into agreements to
provide salary continuation benefits for six months following an employee's
termination without cause so long as on and after January 1, 1999, the Company
shall not be permitted to enter into such agreements with more than 25
employees and the aggregate maximum potential cost to the Company of all such
agreements shall not exceed $1,000,000, (vii) except in the ordinary course of
business consistent with past practice, transfer, lease, license, guarantee,
sell, mortgage, pledge, dispose of, encumber or subject to any lien, any
material assets or incur or modify any indebtedness or other material
liability, or issue any debt securities or assume, guarantee or endorse or
otherwise as an accommodation become responsible for the obligations of any
person or, make any loan or other extension of credit, (ix) agree to the
settlement of any material claim or litigation except for settlements which
have been specifically reserved for in the Company's 1998 financial statements
and except for settlements which individually do not exceed $300,000 and which
in the aggregate, when aggregated with the Excess Settlement Amounts (as
hereinafter defined), do not exceed $2,000,000; provided further that certain
items may only be settled for amounts in excess of the amounts reserved
therefor in the Company's 1998 financial statements (the "Excess Settlement
Amounts") to the extent that the Excess Settlement Amounts, when aggregated
with all other settlements after the date of the Merger Agreement, do not
exceed $2,000,000, (x) make or rescind any material tax election or settle or
compromise any material tax liability, (xi) adopt or enter into a plan of
complete or partial liquidation, dissolution, merger, consolidation,
restructuring, recapitalization or other reorganization of the Company or any
of its material subsidiaries (other than the Merger), (xii) except in the
ordinary course of business consistent with past practice, pay, discharge or
satisfy any material claims, liabilities or obligations (absolute, accrued,
asserted or unasserted, contingent or otherwise), other than the payment,
discharge or satisfaction of claims, liabilities or obligations reflected or
reserved against in, or contemplated by, the consolidated financial statements
(or the notes thereto) contained in any forms, reports, schedules, statements,
registration statements and other filings filed by the Company and its
subsidiaries with the Commission since June 30, 1997, together with any
exhibits, any amendments thereto and information incorporated by reference
therein, (xiii) except in the ordinary course of business consistent with past
practice, enter into any agreement, understanding or commitment that
restrains, limits or impedes the Company's or any of its subsidiaries' ability
to compete with or conduct any business or line of business, including, but
not limited to, geographic limitations on the Company's or any of its
subsidiaries' activities, (xiv) take any action, engage in any transaction or
enter into any agreement which would cause any of the offer conditions set
forth in Section 14--"Conditions of the Offer" to not be satisfied, (xv) in
the case of the Company only, take any action including, without limitation,
the adoption of any shareholder rights plan or amendments to its certificate
of incorporation or by-laws (or comparable governing documents), which would,
directly or indirectly, restrict or impair the ability of Parent to vote, or
otherwise to exercise the rights and receive the benefits of a stockholder
with respect to, securities of the Company that may be acquired or controlled
by Parent or the Purchaser or permit any stockholder to acquire securities of
the Company on a basis not available to Parent or the Purchaser in the event
that Parent or the Purchaser were to acquire any shares of its capital stock;
or (xvi) agree, in writing or otherwise, to take any of the foregoing actions.
The Company has also agreed to consult at least bi-weekly (or such shorter
intervals as Parent may reasonably request) with Parent on ongoing operational
issues with respect to the business and, in any event, shall keep Parent fully
informed with respect to the progress of certain transactions. Each of the
parties agrees to designate an officer to serve as its designated
representative to facilitate these consultations (each, a "Designated
Representative"). The Designated Representative of Parent shall use its
reasonable efforts to respond to written requests for waivers of the covenants
under the immediately preceding paragraph in no more than 48 hours from the
time of receipt.
No Solicitation. The Company and its affiliates and each of their respective
officers, directors, employees, representatives, consultants, investment
bankers, attorneys, accountants and other agents shall immediately cease any
discussions or negotiations with any other parties that may be ongoing with
respect to any Acquisition Proposal (as defined below). Other than in
accordance with the paragraph below, the Company shall not, directly
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<PAGE>
or indirectly, take (and the Company shall not authorize or permit its
affiliates or its or its affiliates' officers, directors, employees,
representatives, consultants, investment bankers, attorneys, accountants or
other agents, to so take) any action to (i) solicit, initiate, facilitate or
encourage the making of any Acquisition Proposal or any inquiries or the
making of any proposal that may reasonably be expected to lead to any
Acquisition Proposal (including, without limitation, by taking any action that
would make the Rights Agreement or Section 203 of the DGCL inapplicable to an
Acquisition Proposal), (ii) participate in any way in discussions or
negotiations with, or furnish or disclose any information to, any person
(other than Parent, the Purchaser or the agents or representatives of Parent
or the Purchaser) in connection with any Acquisition Proposal, (iii) enter
into any agreement, arrangement or understanding with respect to any
Acquisition Proposal or enter into any arrangement, understanding or agreement
requiring it to abandon, terminate or fail to consummate the Merger or any
other transaction contemplated by the Merger Agreement, (iv) withdraw or
modify, or propose to withdraw or modify, in a manner adverse to Parent or the
Purchaser, the approval and recommendation of the Offer and the Merger
Agreement or (v) approve or recommend, or propose to approve or recommend, any
Acquisition Proposal.
The Merger Agreement provides that the Company may take any of the actions
prohibited by clauses (ii) through (v) of the second sentence of the
immediately preceding paragraph in response to an unsolicited Acquisition
Proposal if (1) the Company is in compliance with its obligations under the
next paragraph, (2) with respect to any action that would otherwise be
prohibited by clause (ii) of the second sentence of the immediately preceding
paragraph, (A) such action is taken subject to a confidentiality agreement
with terms not more favorable to such third party than the terms of the
Confidentiality Agreement entered into between the Company and Parent dated as
of February 26, 1999 (the "Confidentiality Agreement"), (B) the Board of
Directors determines, after receiving advice from outside nationally
recognized legal counsel to the Company and from nationally recognized
investment bankers, that such Acquisition Proposal is reasonably likely to
result in a Superior Proposal (as hereinafter defined) within a reasonable
period of time and such determination remains in effect at all times that the
Company is taking any of the actions prohibited by clause (ii) with respect to
such Acquisition Proposal and (C) the Board of Directors determines, after
receiving advice from outside nationally recognized legal counsel to the
Company, that the failure to take such action would likely breach the
fiduciary duties of the Board of Directors and (3) with respect to any action
that would otherwise be prohibited by clauses (iii) through (v) of the second
sentence of the immediately preceding paragraph, such Acquisition Proposal is
a Superior Proposal and the Board of Directors determines, based on advice
from outside nationally recognized legal counsel to the Company and nationally
recognized investment bankers, that the failure to take such action would
likely breach the fiduciary duties of the Board of Directors. "Acquisition
Proposal" shall mean a proposal or offer for a merger or consolidation with
the Company, sale or purchase of substantial assets or stock of the Company,
tender or exchange offer for capital stock of the Company, or business
combination or change in control or similar transaction involving the Company,
other than the Offer and the Merger. "Superior Proposal" shall mean a bona
fide proposal made by a third party to acquire all of the capital stock
(including the Common Stock Purchase Warrants and the Special Common Stock
Warrant) of the Company which (i) the Board of Directors determines in its
good faith reasonable judgment, after receiving advice from nationally
recognized investment bankers and outside nationally recognized legal counsel
to the Company, would, if consummated, result in a transaction that is more
favorable to the Company's stockholders than the transactions contemplated
hereby, (ii) with respect to which the Company has received a representation
and warranty with regard to the financing therefor no less favorable to the
Company than the representation as to the sufficiency of funds provided by
Parent and the Purchaser in the Merger Agreement, and the Company has no
reason to believe that such representation is not true (it being understood
that a representation which refers to highly confident letters and similar
letters shall not be considered at least as favorable to the Company as the
representation regarding the sufficiency of funds of Parent and the
Purchaser), and (iii) is not subject to any financing or due diligence
condition.
The Merger Agreement provides that, in addition to the obligations of the
Company set forth two paragraphs above, on the date thereof, the Company shall
advise Parent of any request for information or of any Acquisition Proposal,
or any inquiry, proposal, discussions or negotiation with respect to any
Acquisition Proposal, the terms and conditions of such request, Acquisition
Proposal, inquiry, proposal, discussion or negotiation and the
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Company shall promptly provide to Parent copies of any written materials
received by the Company in connection with any of the foregoing, and the
identity of the person making any such Acquisition Proposal or such request,
inquiry or proposal or with whom any discussion or negotiation are taking
place. The Company shall promptly provide to Parent any written non-public
information concerning the Company provided to any other person in connection
with any Acquisition Proposal which was not previously provided to Parent. In
the event that the Board of Directors has determined, after receiving advice
from nationally recognized investment bankers and outside nationally
recognized legal counsel, that an Acquisition Proposal is a Superior Proposal,
the Company shall deliver to Parent written notice of such determination.
During the three (3) business day period immediately succeeding delivery of
such notice, the Company shall, and shall cause its financial and legal
advisors to, inform Parent of the terms and conditions of such Superior
Proposal, and the identity of the person making such Superior Proposal, and
the Company shall, and shall cause its financial and legal advisors to,
negotiate with Parent to agree to a modification of the terms and conditions
of the Merger Agreement as would enable the Company to proceed with the
transactions contemplated by the Merger Agreement on such adjusted terms.
The Merger Agreement provides that, immediately following the purchase of
Offer Securities pursuant to the Offer, the Company shall request each person
which has heretofore executed a confidentiality agreement in connection with
its consideration of acquiring the Company or any portion thereof to return
all confidential information heretofore furnished to such person by or on
behalf of the Company.
Directors' and Officers' Insurance and Indemnification. The Merger Agreement
provides that the certificate of incorporation and the by-laws of the
Surviving Corporation shall contain the provisions with respect to
indemnification and exculpation from liability set forth in the Company's
certificate of incorporation and by-laws on May 3, 1999, which provisions
shall not be amended, repealed or otherwise modified for a period of six years
from the Effective Time in any manner that would adversely affect the rights
thereunder of individuals who on or prior to the Effective Time were
directors, officers, employees or agents of the Company (the "Indemnified
Parties"), unless such modification is required by law. In addition, pursuant
to the Merger Agreement, the Surviving Corporation shall, for a period of six
years from the Effective Time, either (a) maintain in effect the Company's
current directors' and officers' liability insurance covering the Indemnified
Parties; provided, however, that in no event shall Parent be required to
expend in any one year an amount in excess of 125% of the annual premiums
currently paid by the Company for such insurance which the Company represents
to be $694,000 for the twelve month period ending on December 31, 1999;
provided further, that if the annual premiums of such insurance coverage
exceed such amount, the Surviving Corporation shall be obligated to obtain a
policy with the greatest coverage available for a cost not exceeding such
amount; provided further that the Surviving Corporation may substitute for
such Company policies policies providing at least the same coverage and
containing terms and conditions which are no less advantageous provided that
said substitution does not result in any gaps or lapses in coverage with
respect to matters occurring prior to the Effective Time or (b) cause the
Parent's directors' and officers' liability insurance then in effect to cover
the Indemnified Parties with respect to those matters covered by the Company's
directors' and officers' liability policy.
The Surviving Corporation shall indemnify all Indemnified Parties to the
fullest extent permitted by applicable law with respect to all acts and
omissions arising out of such individuals' services as officers, directors,
employees or agents of the Company or any of its subsidiaries or as trustees
or fiduciaries of any plan for the benefit of employees of the Company or any
of its subsidiaries occurring prior to the Effective Time including, without
limitation, the transactions contemplated by the Merger Agreement.
Compensation and Benefits. Pursuant to the Merger Agreement, until the first
anniversary of the Effective Time, the Surviving Corporation shall ensure that
all employees and officers of the Company receive benefits that, taken as a
whole, are not materially less favorable in the aggregate to the benefits
received by such individuals immediately prior to May 3, 1999 under applicable
Employee Benefit Plans (other than any Employee Benefit Plan providing for
stock based compensation or benefits), which Employee Benefit Plan shall mean
each domestic and foreign employee benefit plan, within the meaning of Section
3(3) of the Employee Retirement Income Security Act of 1974 as amended and the
rules and regulations thereunder ("ERISA"),
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whether or not subject to ERISA, and each stock option, stock appreciation
right, restricted stock, stock purchase, incentive, bonus, profit-sharing,
savings, deferred compensation, health, medical, dental, life insurance,
disability, accident, supplemental unemployment or retirement, employment,
severance or salary or benefits continuation or fringe benefit plan, program,
arrangement, agreement or commitment currently maintained by the Company or
any subsidiary thereof for the benefit of any employee, director, former
employee, former director of the Company or any of its subsidiaries or to
which the Company or any subsidiary thereof (including all employers (whether
or not incorporated) that would be treated together with the Company as a
single employer within the meaning of Section 414 of the United States
Internal Revenue Code of 1986, as amended) contributes (or has any obligation
to contribute), has any liability or is a party. Notwithstanding anything in
the Merger Agreement to the contrary, from and after the Effective Time, the
Surviving Corporation shall have sole discretion over the hiring, promotion,
retention, termination and other terms and conditions of the employment of the
employees of the Surviving Corporation consistent with applicable law. With
respect to each employee benefit plan (as defined in Section 3(3) of ERISA) or
similar policy or program provided by the Surviving Corporation to employees
of the Company (the "Surviving Corporation Plans"), for purposes of
determining eligibility to participate, vesting and entitlement to benefits
(including severance benefits and vacation entitlement, but not for accrual of
pension benefits), service with the Company (or predecessor employers to the
extent the Company provides past service credit) shall be treated as service
with the Surviving Corporation (except to the extent such recognition would
result in duplication of benefits). Such service shall also apply for purposes
of satisfying any waiting periods, evidence of insurability requirements or
the application of any pre-existing condition limitations. Employees of the
Company shall be given credit for amounts paid under a corresponding welfare
benefit plan during the same period for purposes of applying deductibles, co-
payments and out-of-pocket maximums as though such amounts had been paid in
accordance with the terms of the applicable Surviving Corporation Plan. Except
as otherwise provided in this paragraph, nothing in the section on employee
benefits in the Merger Agreement shall prevent Parent or the Surviving
Corporation from amending or terminating any Employee Benefit Plan in
accordance with its terms. At the Effective Time, the Surviving Corporation
shall assume and honor, or cause the applicable subsidiary to assume and
honor, in accordance with their terms (i) all employment, severance and each
other compensation agreement and arrangement existing prior to the execution
of the Merger Agreement which are between the Company or any subsidiary and
any director, officer or employee thereof and (ii) all collective bargaining
agreements or shop agreements or other arrangements with unions, workers
councils or similar organizations. The Company and Parent agree that the
consummation of the offer shall constitute a "change in control" for purposes
of all Employee Benefit Plans which contain such provisions. Parent shall, as
soon as practicable after the Effective Date, commence the implementation of a
stock incentive plan pursuant to which certain employees of Parent and the
Surviving Corporation will be granted, on an annual basis, stock options
entitling the holders thereof to receive, in the aggregate, upon exercise
thereof pursuant to the terms and conditions of such stock incentive plan,
1.4% of the shares of common stock of Parent issued and outstanding as of the
first day of the fiscal year of Parent during which such grant was made,
provided that nothing shall obligate Parent to structure such stock incentive
plan in a manner which would obligate it to any disclosure requirement under
the Securities Act of 1933, as amended, the Exchange Act or the rules and
regulations promulgated thereunder, other than as may be required by Rule
12g3-2(b) under the Exchange Act.
Options. Pursuant to the Merger Agreement, prior to the Effective Time, the
Board of Directors (or, if appropriate, any committee thereof) shall take all
actions and shall use its reasonable best efforts to obtain all necessary
consents and releases from all of the holders of all Options heretofore
granted under any compensatory stock option plan of the Company or otherwise
(the "Stock Plans"), to (i) provide for the cancellation, effective at the
Effective Time, subject to the payment provided for in the next sentence being
made, of all Options, (ii) terminate, as of the Effective Time, the Stock
Plans and any other plan, program or arrangement providing for the issuance or
grant of any other interest in respect of the capital stock of the Company or
any of its subsidiaries (collectively with the Stock Plans, referred to as the
"Stock Incentive Plans") and (iii) amend, as of the Effective Time, the
provisions of any other Employee Benefit Plan (as defined in the immediately
preceding paragraph) providing for the issuance, transfer or grant of any
capital stock of the Company or any such subsidiary, or any interest in
respect of any capital stock of the Company or any such subsidiary, to provide
no continuing rights to acquire, hold, transfer or grant any capital stock of
the Company or any such subsidiary or any interest in the
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capital stock of the Company or any such subsidiary. Stock Plans shall not
include any Intercompany Convertible Instruments (defined as any instrument
held pursuant to the Intercompany Convertible Instruments Agreement dated as
of October 29, 1993 by and between the Company and ASTT), and Options shall
not include any options granted under any Intercompany Convertible Instrument.
Immediately prior to the Effective Time, each Option, whether or not then
vested or exercisable, shall no longer be exercisable for the purchase of
shares of Common Stock but shall entitle each holder thereof, in cancellation
and settlement therefor, to payments by the Company in cash (the "Cash
Payment"), at the Effective Time, equal to the product of (a) the total number
of shares of Common Stock subject to such Option, whether or not then vested
or exercisable, and (b) the amount by which the Applicable Merger
Consideration for shares of Common Stock exceeds the exercise price per share
of Common Stock subject to such Option, each such Cash Payment to be paid to
each holder of an outstanding Option at the Effective Time. The Company shall
deliver to Parent on the date that is two (2) business days prior to the
Effective Time a list of the Options which are outstanding as of such date,
together with detailed calculations of the Cash Payments relating to such
Options as if the Effective Time had occurred on such date. Except as
otherwise contemplated in the Merger Agreement, any then outstanding stock
appreciation rights or limited stock appreciation rights issued by the Company
or any subsidiary of the Company shall be canceled immediately prior to the
Effective Time without any payment therefor. The Company shall use its
reasonable best efforts to ensure that neither it nor any of its subsidiaries
is or will be bound by any Options, other options, warrants, rights or
agreements which would entitle any person, other than Parent or its
affiliates, to own any capital stock of the Company or any of its subsidiaries
or to receive any payment in respect thereof. Notwithstanding any other
provision of this paragraph, the Company shall not be required to purchase any
minority equity interests in any of its subsidiaries. Notwithstanding any
other provision of the section on options in the Merger Agreement to the
contrary, payment of the Cash Payment may be withheld with respect to any
Option until necessary consents and releases are obtained. The Company shall
take all steps as may be required to provide that with respect to each
individual who is a director or officer of the Company immediately prior to
the Effective Time all transactions contemplated by the Merger Agreement with
respect to Offer Securities held by such person shall be exempt under the
Exchange Act in accordance with the terms and conditions set forth in that
certain No-Action Letter, dated January 12, 1999, issued by the Securities and
Exchange Commission to Skadden, Arps, Slate, Meagher & Flom LLP. Immediately
prior to the Merger, the Company shall cause any restrictions imposed on the
606,500 shares of Common Stock which were issued to certain employees and the
outright, unencumbered ownership of which is subject to the fulfillment of
certain conditions, to be lifted.
Agreement to Use Reasonable Best Efforts. Pursuant to the Merger Agreement
and subject to the terms and conditions thereof, each of the Company, Parent
and the Purchaser shall, and the Company shall cause each of its subsidiaries
to, cooperate and use their reasonable best efforts to take, or cause to be
taken, all appropriate action, and to make, or cause to be made, all filings
necessary, proper or advisable under applicable laws and regulations to
consummate and make effective the transactions contemplated by the Merger
Agreement including, without limitation, their reasonable best efforts to
obtain, prior to the Closing Date, all licenses, permits, consents, approvals,
authorizations, qualifications and orders of governmental authorities and
parties to contracts with the Company and its subsidiaries as are necessary
for consummation of the transactions contemplated by the Merger Agreement and
to fulfill the conditions to the Offer and the Merger; provided, however, that
no loan agreement or contract for borrowed money shall be repaid except as
currently required by its terms, in whole or in part, and no contract shall be
amended to increase the amount payable thereunder or otherwise to be more
burdensome to the Company or any of its subsidiaries in order to obtain any
such consent, approval or authorization without the prior written consent of
Parent (which shall not be unreasonably withheld). Without limiting the
generality of the foregoing, without the prior written consent of the Company,
neither Parent nor the Purchaser will take any action which would cause any of
the conditions set forth in the Commitment Letter not to be satisfied or which
would make its representation regarding the sufficiency of funds of Parent and
the Purchaser untrue.
In addition, the Merger Agreement provides that each party thereto shall (i)
take promptly all actions necessary to make the filings required of it or any
of its affiliates under any applicable antitrust laws in connection with the
Merger Agreement and the transactions contemplated thereby, (ii) comply at the
earliest
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practicable date with any formal or informal request for additional
information or documentary material received by it or any of its affiliates
from any antitrust authority and (iii) cooperate with one another in
connection with any filing under applicable antitrust laws and in connection
with resolving any investigation or other inquiry concerning the transactions
contemplated by the Merger Agreement initiated by any antitrust authority.
Each party to the Merger Agreement shall use its reasonable best efforts to
resolve such objections, if any, as may be asserted with respect to the
transactions contemplated by the Merger Agreement under any antitrust law.
Each party to the Merger Agreement shall promptly inform the other parties of
any material communication made to, or received by such party from, any
antitrust authority or any other governmental or regulatory authority
regarding any of the transactions contemplated thereby.
The Merger Agreement also provides that the Company and Parent shall, as
soon as practicable and in any event within five (5) days of the date of the
Merger Agreement, file a voluntary notification pursuant to, and in compliance
with, Exon-Florio and shall use their reasonable best efforts to respond to
any inquiries from governmental officials with respect thereto.
Representations and Warranties. In the Merger Agreement, the Company has
made customary representations and warranties to Parent and the Purchaser with
respect to, among other things, its organization, corporate authority,
capitalization, financial statements, public filings, litigation, compliance
with laws, consent and approvals, employee benefit plans, brokers' or finders'
fees, state takeover statutes, voting requirements, undisclosed liabilities,
taxes, intellectual property, Year 2000 compliance and the absence of any
material adverse changes in the Company since December 31, 1998.
Termination. The Merger Agreement may be terminated at any time prior to the
Effective Time, whether before or after approval of the Merger by the
Company's stockholders (a) by mutual consent of the Company, on the one hand,
and of Parent and the Purchaser, on the other hand; provided, however, that
after consummation of the Offer, the consent of a majority of the Independent
Directors (defined as a director who is a director on May 3, 1999 and who is
not an affiliate or associate of Parent or the Purchaser or any other person
who beneficially owns Offer Securities representing 5% or more of the Common
Stock Equivalents, or is designated by a majority of the directors of the
Company who are such directors) shall also be required to terminate the Merger
Agreement, (b) by either Parent, on the one hand, or the Company, on the other
hand, if any statute, rule or regulation shall have been promulgated which
prohibits the consummation of the Offer or the Merger or if any order or
injunction of a court of competent jurisdiction which prohibits consummation
of the Offer or the Merger shall have become final and nonappealable, (c) by
either Parent, on the one hand, or the Company, on the other hand, if the
Offer shall have expired without any Offer Securities being purchased pursuant
thereto as a result of the failure to meet any one or more of the tender offer
conditions set forth in Section 14--"Conditions of the Offer", provided,
however, that the right to terminate the Merger Agreement shall not be
available (i) to the Company if the Merger Agreement may be terminated by
Parent pursuant to clause (d) set forth below in this paragraph and (ii) to
Parent if the Merger Agreement may be terminated by the Company pursuant to
clause (g) set forth below in this paragraph, (d) by Parent, in the event of,
at any time prior to consummation of the Offer, a breach by the Company of any
representation, warranty, covenant or agreement contained in the Merger
Agreement which, if uncured, would give rise to the failure of a condition set
forth in clause (v)(e) or (f) of the tender offer conditions set forth in
Section 14--"Conditions of the Offer" and such breach is incapable of being
cured or, if capable of being cured, has not been cured within fifteen (15)
business days following receipt by the Company of written notice of such
breach from Parent and has not been waived by Parent pursuant to the
provisions hereof, (e)(i) by Parent if, at any time prior to consummation of
the Offer, (A) the Company shall have (w) entered into any agreement,
arrangement or understanding with respect to any Acquisition Proposal, (x)
withdrawn or modified, or proposed to withdraw or modify, in a manner adverse
to Parent or the Purchaser, the approval and recommendation of the Offer and
the Merger Agreement, or (y) approved or recommended, or proposed to approve
or recommend, any Acquisition Proposal or (z) announced a neutral position
with respect to any Acquisition Proposal and does not reject or recommend such
Acquisition Proposal within three (3) business days of the announcement of
such neutral position, (B) the Board of Directors or any committee thereof
shall have failed to reaffirm its approval and recommendation of the Offer,
the Merger and the Merger Agreement
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within three (3) business days of Parent's request for such reaffirmation, or
(C) the Company or the Board of Directors or any committee thereof shall have
resolved to do any of the foregoing or (ii) by the Company if, at any time
prior to consummation of the Offer, the Company shall have entered into an
agreement to effect a Superior Proposal and the entering into of such
agreement is permitted in accordance with the provision on no solicitation of
the Merger Agreement described above and the fees payable by the Company to
Parent in an amount equal to $65,000,000 are paid simultaneously with such
termination, (f) by Parent, if the Minimum Condition shall not have been
satisfied by the expiration date of the Offer and on or prior to such date a
third party shall have made or caused to be made a proposal, or public
announcement of a proposal, to the Company or its stockholders with respect to
(A) the acquisition of the Company by merger, tender offer or otherwise; (B) a
merger, consolidation or similar business combination with the Company or any
of its subsidiaries; (C) the acquisition of 20% or more of the assets of the
Company and its subsidiaries, taken as a whole; (D) the acquisition of 20% or
more of the Common Stock Equivalents of the Company or (E) the adoption by the
Company of a plan of liquidation or the declaration or payment of an
extraordinary dividend (any of the proposed transactions enumerated in clauses
(A) through (E), an "Alternative Proposal"), (g) by the Company, in the event
of, at any time prior to consummation of the Offer, (i) a breach by Parent or
the Purchaser of any representation or warranty contained in the Merger
Agreement which, if uncured, would result in any such representation or
warranty that is qualified as to materiality being untrue or incorrect in any
respect or in any such representation or warranty that is not so qualified
being untrue or incorrect in any material respect, in each case as of the date
of the consummation of the Offer as though made on or as of such date, except
(x) for changes specifically permitted by the Merger Agreement and (y) that,
to the than Evaluation Material (as defined below) solely for the purpose of
evaluating a possible business transaction (the "Possible Transaction") and to
keep such information confidential; provided, however, that (i) the Evaluation
Material may be disclosed to Parent's Advisors who need extent such
representations and warranties address matters only as of a particular date,
such representations and warranties shall, to such extent, be true and correct
at and as of such particular date as if made at and as of such particular date
or (ii) Parent or the Purchaser shall have failed to perform in all material
respects any obligation or to comply in any material respect with any
agreement or covenant of Parent or the Purchaser to be performed or complied
with by it under the Merger Agreement, and, in the case of either clause (i)
or (ii), such breach or failure is incapable of being cured or, if capable of
being cured, has not been cured within fifteen (15) business days following
receipt by Parent of written notice of such breach from the Company or has not
been waived by the Company pursuant to the provisions hereof, (h) by the
Company, if Parent or the Purchaser shall have failed to commence the Offer
within six (6) business days following the date of the Merger Agreement; (i)
by Parent, on the one hand, or the Company, on the other hand, if the
acceptance for payment of the Offer Securities shall not have occurred within
one hundred twenty (120) days after commencement of the Offer, provided,
however, that the right to terminate the Merger Agreement shall not be
available (i) to the Company if the Merger Agreement may be terminated by
Parent pursuant to clause (d) above or if any of the events set forth in
clauses (v) (g) or (h) of the tender offer conditions set forth in Section
14--"Conditions of the Offer" shall have occurred or an Alternative Proposal
shall have been outstanding at any time during the thirty (30) day period
ending prior to such date of proposed termination and (ii) to Parent if the
Merger Agreement may be terminated by the Company pursuant to clause (g)
above.
The Merger Agreement provides that, in the event of termination of the
Merger Agreement pursuant to the provisions described above by Parent, on the
one hand, or the Company, on the other hand, no party will incur any liability
to any other party except for breach of the Merger Agreement and the survival
of certain provisions relating to the representations and warranties of the
Company, Parent and the Purchaser regarding broker's and finder's fees,
confidentiality, fees and expenses, the applicable law and the waiver of jury
trial.
Confidentiality Agreement. The following is a summary of the Confidentiality
Agreement. The summary is qualified in its entirety by reference to the
Confidentiality Agreement, a copy of which has been filed with the Commission
as an exhibit to the Schedule 14D-1. The Confidentiality Agreement can be
inspected at, and copies may be obtained from, the same places and in the
manner set forth in Section 7--"Certain Information Concerning the Company".
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Pursuant to the Confidentiality Agreement, Parent has agreed, among other
things, to use any information concerning the Company (whether prepared by the
Company, its Advisors (as defined below) or otherwise) (the "Evaluation
Material") (but excluding information which (i) was already in Parent's
possession, provided that such information is not known by Parent to be
subject to another confidentiality agreement with the Company or another
party, (ii) was, is or will be in the public domain other than as a result of
a disclosure by Parent or Parents' directors, officers, employees, agents or
advisors (collectively, "Advisors"), (iii) was, is or will be available to
Parent on a non-confidential basis from a source other than the Company or its
Advisors, provided that such source is not known by Parent to be bound by a
confidentiality agreement with the Company or another party or (iv) has been
independently acquired or developed by Parent or its Advisors based on
information other to know such information solely for the purpose of
evaluating the Possible Transaction and (ii) any disclosure of the Evaluation
Material may be made to which the Company consents in writing. Both Parent and
the Company (each, a "Party" and, collectively, the "Parties") have agreed
that for a period commencing on February 26, 1999 and ending two years after
the termination of the Confidentiality Agreement, neither Party will hire or
solicit for employment any of each other's employees, including employees of
their respective subsidiaries, with whom Parent or its Advisors, on the one
hand, or the Company and its Advisors, on the other, have had contact during
the course of discussions related to the Possible Transaction. The
Confidentiality Agreement and all obligations thereunder will terminate two
years from February 26, 1999. The Company also agreed to treat any information
concerning Parent's business with the same confidentiality and subject to the
same restrictions as the Confidentiality Agreement requires Parent to observe
with respect to the information provided by the Company to Parent.
12. Dividends and Distributions. As described above, the Merger Agreement
provides that the Company shall not (i) except (A) upon the exercise of
Options, Common Stock Purchase Warrants or the Special Common Stock Warrant,
(B) upon the conversion of the Series A Preferred Stock or Series B Preferred
Stock and (C) pursuant to the terms of the Olivetti Agreement, issue or sell,
or authorize to issue or sell, any shares of its capital stock or any other
securities, or issue or sell, or authorize to issue or sell, any securities
convertible into, or options, warrants or rights to purchase or subscribe to,
or enter into any arrangement or contract with respect to the issuance or sale
of, any shares of its capital stock or any other securities, or make any other
changes in its capital structure or (ii) except in the case of wholly-owned
subsidiaries of the Company, in the ordinary course of business consistent
with past practice, declare, pay or set aside any dividend (other than
dividends on the Series A Preferred Stock or the Series B Preferred Stock in
accordance with the terms of their respective certificates of designation) or
other distribution or payment with respect to, or split, combine, redeem or
reclassify, or purchase or otherwise acquire, any shares of its capital stock
or its other securities.
If, on or after May 3, 1999, the Company should engage in the conduct
referred to in the preceding paragraph, then, subject to the provisions of
Section 14--"Conditions of the Offer", the Purchaser, in its sole discretion,
may make such adjustments as it deems appropriate in the Offer Price and other
terms of the Offer, including, without limitation, the number or type of
securities offered to be purchased.
If, on or after May 3, 1999, the Company should declare, pay or set aside
any dividend (other than dividends on Series A Preferred Stock or Series B
Preferred Stock in accordance with the terms of their respective certificates
of designation) or other distribution with respect to its capital stock
payable or distributable to holders of record on a date prior to the transfer
of the Offer Securities purchased pursuant to the Offer to Purchase on the
Company's stock transfer records, then, subject to the provisions of Section
14--"Conditions of the Offer", (i) the Offer Price may, in the sole discretion
of the Purchaser, be reduced by the amount of any such cash dividend or cash
distribution and (ii) the whole of any such dividend, distribution or issuance
to be received by the tendering holders will (x) be received and held by the
tendering holders for the account of the Purchaser and will be required to be
promptly remitted and transferred by each tendering holder to the Depositary
for the account of the Purchaser, accompanied by appropriate documentation of
transfer, or (y) at the direction of the Purchaser, be exercised for the
benefit of the Purchaser, in which case the proceeds of each exercise will
promptly be remitted to the Purchaser. Pending such remittance and subject to
applicable law, the Purchaser will be entitled to all rights and privileges as
owner of any such dividend or other distribution and may withhold the
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entire Offer Price or deduct from the Offer Price the amount or value thereof,
as determined by the Purchaser in its sole discretion.
Pursuant to the terms of the Merger Agreement, the Company is prohibited
from taking any of the actions described in the preceding paragraphs except as
permitted, required or specifically contemplated by the Merger Agreement and
nothing herein shall constitute a waiver by Parent or the Purchaser of any of
its rights under the Merger Agreement or a limitation of remedies available to
Parent or the Purchaser for any breach of the Merger Agreement, including
termination thereof.
13. Effect of the Offer on the Market for the Offer Securities; Exchange Act
Registration.
Market for Offer Securities. The purchase of shares of Common Stock and
Common Stock Purchase Warrants pursuant to the Offer will reduce the number of
holders of such securities and the number of such securities that might
otherwise trade publicly and could adversely affect the liquidity and market
value of such remaining securities held by the public.
Depending upon the aggregate market value and per share price of any shares
of Common Stock not purchased pursuant to the Offer, the Common Stock may no
longer meet the standards of the NASD for continued inclusion in the Nasdaq
National Market, which require, among other things, that an issuer have at
least 750,000 publicly held shares with a market value of at least $5 million
held by at least 400 holders holding round lots and have net tangible assets
of at least $4 million. If these standards are not met, the Common Stock might
nevertheless continue to be included in the NASD's Nasdaq Stock Market (the
"Nasdaq Stock Market") with quotations published in the Nasdaq "additional
list" or in one of the "local lists". However, if the number of holders of
Common Stock falls below 300, or if the number of shares of publicly held
Common Stock falls below 500,000, or if there are not at least two market
makers for such Common Stock, NASD rules provide that the Common Stock would
no longer be "qualified" for Nasdaq Stock Market reporting, and the Nasdaq
Stock Market would cease to provide any quotations. Common Stock held directly
or indirectly by an officer or director of the Company, or by any beneficial
owner of more than 10% of the shares of Common Stock, ordinarily will not be
considered as being publicly held for this purpose. If, as a result of the
purchase of Common Stock pursuant to the Offer or otherwise, the Common Stock
no longer meets the NASD requirements for continued inclusion in any tier of
the Nasdaq National Market, and the Common Stock is no longer included in any
tier of the Nasdaq Stock Market, the market for such Common Stock could be
adversely affected.
Depending upon the number of Common Stock Purchase Warrants and shares of
Common Stock purchased pursuant to the Offer, the Common Stock Purchase
Warrants may no longer meet the requirements of the NASD for continued
inclusion of a warrant in the Nasdaq National Market, which require among
other things, that the stock of the issuer of such warrant continue to be
listed on the Nasdaq National Market or a national securities exchange. If
these requirements are not met, the Common Stock Purchase Warrants might
nevertheless continue to be included in the Nasdaq Stock Market with
quotations published in the Nasdaq "additional list" or in one of the "local
lists". Depending upon the number of Common Stock Purchase Warrants and shares
of Common Stock purchased pursuant to the Offer, the Common Stock Purchase
Warrants may no longer be "qualified" for Nasdaq Stock Market reporting and
the Nasdaq Stock Market would cease to provide any quotations. If, as a result
of the purchase of Common Stock Purchase Warrants or shares of Common Stock,
pursuant to the Offer or otherwise, the Common Stock Purchase Warrants no
longer meet the requirements of the NASD for continued inclusion in the Nasdaq
Stock Market, the market for the Common Stock Purchase Warrants could be
adversely affected.
In the event the Common Stock and the Common Stock Purchase Warrants no
longer meet the requirements of the NASD for inclusion in any tier of the
Nasdaq Stock Market, quotations might still be available from other sources.
The extent of the public market for Common Stock and Common Stock Purchase
Warrants and availability of such quotations would, however, depend upon the
number of holders of Common Stock and Common Stock Purchase Warrants remaining
at such time, the interest in maintaining a market in the Common
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Stock and the Common Stock Purchase Warrants on the part of securities firms,
the possible termination of registration under the Exchange Act, as described
below, and other factors.
Exchange Act Registration. The Common Stock and the Common Stock Purchase
Warrants are currently registered under the Exchange Act. Registration of the
Common Stock and the Common Stock Purchase Warrants under the Exchange Act may
be terminated upon application of the Company to the Commission if the Common
Stock and the Common Stock Purchase Warrants are neither listed on a national
securities exchange nor held by 300 or more holders of record. Termination of
registration of the Common Stock and the Common Stock Purchase Warrants under
the Exchange Act would substantially reduce the information required to be
furnished by the Company to its stockholders and to the Commission and would
make certain provisions of the Exchange Act no longer applicable to the
Company, such as the short-swing profit recovery provisions of Section 16(b)
of the Exchange Act, the requirement of furnishing a proxy statement pursuant
to Section 14(a) of the Exchange Act in connection with stockholders' meetings
and the related requirement of furnishing an annual report to stockholders and
the requirements of Rule 13e-3 under the Exchange Act with respect to "going
private" transactions. Furthermore, the ability of "affiliates" of the Company
and persons holding "restricted securities" of the Company to dispose of such
securities pursuant to Rule 144 or 144A promulgated under the Securities Act
of 1933, as amended, may be impaired or eliminated. The Purchaser intends to
seek to cause the Company to apply for termination of registration of the
Common Stock and the Common Stock Purchase Warrants under the Exchange Act as
soon after the completion of the Offer as the requirements for such
termination are met.
If registration of the Common Stock is not terminated prior to the Merger,
then the Common Stock will be delisted from all stock exchanges and the
registration of the Common Stock under the Exchange Act will be terminated
following the consummation of the Merger.
Margin Regulations. The shares of Common Stock, the Common Stock Purchase
Warrants and the Special Common Stock Warrant are currently "margin
securities," as such term is defined under the regulations of the Federal
Reserve Board, which has the effect, among other things, of allowing brokers
to extend credit on the collateral of the Common Stock, the Common Stock
Purchase Warrants and the Special Common Stock Warrant. Depending upon factors
similar to those described above regarding listing and market quotations, it
is possible that, following the Offer, shares of the Common Stock, the Common
Stock Purchase Warrants and the Special Common Stock Warrant would no longer
constitute "margin securities" for the purposes of the margin regulations of
the Federal Reserve Board and therefore could no longer be used as collateral
for loans made by brokers. In any event, the shares of Common Stock, the
Common Stock Purchase Warrants and the Special Common Stock Warrant will cease
to be "margin securities" if registration of the Common Stock, the Common
Stock Purchase Warrants and the Special Common Stock Warrant under the
Exchange Act is terminated.
None of the Series A Preferred Stock, the Series B Preferred Stock or the
Depositary Shares is a "margin security".
14. Conditions of the Offer. Notwithstanding any other provision of the
Offer or the Merger Agreement, 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 Offer Securities promptly
after termination or withdrawal of the Offer), pay for any Offer Securities
tendered pursuant to the Offer and may terminate the Offer and may postpone
the acceptance of, and payment for, any Offer Securities if (i) there shall
not have been validly tendered and not properly withdrawn prior to the
expiration of the Offer, Offer Securities which represent at least a majority
of all of the Common Stock Equivalents on the date of purchase, (ii) any
applicable waiting period (and any extension thereof) under the HSR Act shall
not have expired or been terminated, prior to the expiration of the Offer,
(iii) a decision of the Commission of the European Community that the purchase
of the Offer Securities pursuant to the Offer and the Merger are compatible
with the common market shall not have been received prior to the expiration of
the Offer, (iv) any applicable waiting period under Exon-Florio shall not have
expired or been terminated prior to the
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expiration of the Offer or (v) if, at any time after the date of the Merger
Agreement and at or before the time of payment for any such Offer Securities
(whether or not any Offer Securities have theretofore been accepted for
payment or paid for pursuant to the Offer), any of the following shall occur:
(a) there shall be instituted or pending any action or proceeding by any
government or governmental authority or agency, domestic or foreign, or by
any other person, domestic or foreign, before any court of competent
jurisdiction or governmental authority or agency, domestic or foreign,
which could reasonably be expected to (i) make illegal, or directly or
indirectly prohibit or make materially more costly the Offer or the Merger
or result in material damages, (ii) result in a prohibition or material
limitation on the ownership or operation by Parent or the Purchaser of all
or any material portion of the business or assets of the Company and its
subsidiaries taken as a whole or compel Parent or the Purchaser to dispose
of or hold separately all or any material portion of the business or assets
of Parent and its subsidiaries taken as a whole or the Company and its
subsidiaries taken as a whole, or impose any material limitation on the
ability of Parent or the Purchaser to conduct its business or own such
assets, (iii) result in an imposition of limitations on the ability of
Parent or the Purchaser effectively to exercise full rights of ownership of
the Offer Securities including, without limitation, the right to vote any
Offer Securities acquired or owned by the Purchaser or Parent on all
matters properly presented to the Company's stockholders or (iv) a
requirement of divestiture by Parent or the Purchaser of any Offer
Securities;
(b) there shall be any action taken, or any statute, rule, regulation,
legislation, interpretation, judgment, order or injunction proposed,
enacted, enforced, promulgated, amended or issued and applicable to or
deemed applicable to (i) Parent, the Purchaser, the Company or any
subsidiary of the Company or (ii) the Offer or the Merger, by any
legislative body, court, government or governmental, administrative or
regulatory authority or agency, domestic or foreign, other than the routine
application of the waiting period provisions of the HSR Act or Exon-Florio
or the modification and reporting requirements under European Community
antitrust laws (in each case with respect to the Offer or to the Merger),
that could reasonably be expected to result directly or indirectly, in any
of the consequences referred to in paragraph (a) above;
(c) there shall have occurred, any event, change, occurrence, effect,
fact or circumstance which has or could reasonably have, a Material Adverse
Effect (as such term is defined below) or a Performance Material Adverse
Effect (as such term is defined below) on the Company;
(d) there shall have occurred (i) any general suspension of trading in,
or limitation on prices for, securities on any United States securities
exchange, in any United States over-the-counter market or the AEX-Stock
Exchange for a period in excess of 12 hours (excluding any coordinated
trading halt triggered solely as a result of a specified decrease in a
market index), (ii) any decline in the Morgan Stanley World Index in excess
of 23% measured from the close of business on the trading day next
preceding the date of the Merger Agreement, (iii) a declaration of a
banking moratorium or any suspension of payments in respect of banks in the
United States or any other jurisdiction in which any bank or other
financial institution in any manner involved with the financing of the
Offer or the Merger is incorporated or (iv) any material limitation
(whether or not mandatory) by any Federal, state or foreign governmental
authority or agency on, the extension of credit by banks or other lending
institutions which materially and adversely affects the ability of Parent
to obtain the financing necessary to effect the Offer or the Merger;
(e) any of the representations or warranties made by the Company in the
Merger Agreement that are qualified as to materiality shall be untrue or
incorrect in any respect or any such representations and warranties that
are not so qualified shall be untrue or incorrect in any material respect,
in each case as of the date of the consummation of the Offer as though made
on or as of such date, except (i) for changes specifically permitted by the
Merger Agreement and (ii) that to the extent such representations and
warranties address matters only as of a particular date, such
representations and warranties shall, to such extent, be true and correct
at and as at such particular date as if made at and as of such particular
date;
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(f) the Company shall have failed to perform in any material respect any
obligation or to comply in any material respect with any agreement or
covenant of the Company to be performed or complied with by it under the
Merger Agreement on or prior to the date of consummation of the Offer;
(g) the Board of Directors or any committee thereof shall have withdrawn,
or modified or proposed to withdraw or modify, in a manner adverse to
Parent or the Purchaser, the approval and recommendation of the Offer and
the Merger Agreement, or approved or recommended, or proposed to approve or
recommend, any Acquisition Proposal, or announced a neutral position with
respect to any Acquisition Proposal and does not reject or recommend such
Acquisition Proposal within three (3) business days of the announcement of
such neutral position or, upon request by Parent, shall have failed to
reaffirm its approval and recommendation of the Offer, the Merger and the
Merger Agreement within three (3) business days of the Purchaser's request
for such affirmation or shall have resolved to do any of the foregoing;
(h) beneficial ownership (determined for the purposes of this paragraph
(h) as set forth in Rule 13d-3 promulgated under the Exchange Act) of 20%
or more of the capital stock of the Company shall have been acquired by any
person or group (as defined in Section 13(d)(3) under the Exchange Act); or
(i) the Merger Agreement shall have been terminated in accordance with
its terms.
"Material Adverse Effect", with respect to any person, shall mean a material
adverse effect on the business, assets, liabilities, results of operations or
financial condition of such person and its subsidiaries, taken as a whole;
provided that none of the Company Excluded Factors (as such term is defined
below) shall be deemed by itself or themselves, either alone or in combination
with one or more other Company Excluded Factors, to constitute a Material
Adverse Effect on the Company.
"Performance Material Adverse Effect", with respect to any person, shall
mean a material adverse effect on the ability of such person to perform its
obligations under the Merger Agreement or to consummate the transactions
contemplated thereby.
"Company Excluded Factors" shall mean: (a) any change, in and of itself, in
the market price or trading volume of the Offer Securities; (b) any failure,
in and of itself, by the Company to meet the revenue or earnings predictions
of equity analysts as reflected in the First Call consensus estimate, or any
other revenue or earnings predictions or expectations, for any period ending
(or for which earnings are released) on or after the date of the Merger
Agreement and prior to the Effective Time; or (c)(i) employee attrition (other
than senior managers) and (ii) the loss of existing customers by WGSI or the
failure or delay by existing or prospective customers of WGSI to purchase or
enter into agreements to purchase services or solutions from the Company or
any of its subsidiaries, in each case arising out of, resulting from or
attributable to (x) the announcement of the Merger Agreement and the
transactions contemplated thereby or (y) Parent's announcement or other
communication of the plans or intentions of Parent with respect to the conduct
of any business of the Company or any of its subsidiaries.
The foregoing conditions are for the sole benefit of Parent and the
Purchaser and may be asserted by Parent or the Purchaser, or may be waived by
Parent or the Purchaser (except for the Minimum Condition), in whole or in
part at any time and from time to time in their respective 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 and each such
right shall be deemed an ongoing right which may be asserted at any time and
from time to time.
15. Certain Legal Matters; Regulatory Approvals.
General. Except as otherwise disclosed herein, based on a review of publicly
available information filed by the Company with the Commission, neither Parent
nor the Purchaser is aware of (i) any license or regulatory permit that
appears to be material to the business of the Company and its subsidiaries,
taken as a whole, that might be adversely affected by the acquisition of Offer
Securities by the Purchaser pursuant to the Offer or the
41
<PAGE>
Merger or (ii) any approval or other action by any governmental,
administrative or regulatory agency or authority, domestic or foreign, that
would be required for the acquisition or ownership of Offer Securities by the
Purchaser as contemplated herein. Should any such approval or other action be
required, the Purchaser currently contemplates that it would seek such
approval or action. The Purchaser's obligation under the Offer to accept for
payment and pay for Offer Securities is subject to certain conditions. See
Section 14--"Conditions of the Offer". While the Purchaser does not currently
intend to delay the acceptance for payment of Offer Securities tendered
pursuant to the Offer pending the outcome of any such matter, there can be no
assurance that any such approval or action, if needed, would be obtained or
would be obtained without substantial conditions or that adverse consequences
might not result to the business of the Company, Parent or the Purchaser or
that certain parts of the businesses of the Company, Parent or the Purchaser
might not have to be disposed of in the event that such approvals were not
obtained or any other actions were not taken.
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 the date the interested stockholder
became an interested stockholder, 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 Company has
represented to Parent and the Purchaser in the Merger Agreement that the Board
of Directors has approved the Offer, the Merger and the Merger Agreement and
that such approval is sufficient to render the provisions of Section 203 of
the DGCL inapplicable to the Offer, the Merger and the Merger Agreement.
A number of other states have adopted laws and regulations applicable to
attempts to acquire securities of corporations which are incorporated, or have
substantial assets, holders, 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, which, 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 holders. The
state law before the Supreme Court was by its terms applicable only to
corporations that had a substantial number of holders in the state and were
incorporated there.
The Company, directly or through subsidiaries, conducts business in a number
of states throughout the United States, some of which have enacted takeover
laws. Based on information supplied by representations of the Company in the
Merger Agreement, the Purchaser does not believe that any state takeover
statutes apply to the Offer. Neither Parent nor the Purchaser has currently
complied with any state takeover statute or regulation. The Purchaser reserves
the right to challenge the applicability or validity of any state law
purportedly applicable to the Offer or the Merger and nothing in this Offer to
Purchase or any action taken in connection with the Offer or the Merger is
intended as a waiver of such right. In the event it is asserted that one or
more state takeover laws is applicable to the Offer or the Merger, and an
appropriate court does not determine that it is inapplicable or invalid as
applied to the Offer or the Merger, 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 Offer Securities 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 any Offer Securities
tendered. See Section 14--"Conditions of the Offer".
Appraisal Rights. No appraisal rights are available to holders of Offer
Securities in connection with the Offer.
42
<PAGE>
However, if the Merger is consummated, a holder of Common Stock, Series A
Preferred Stock or Series B Preferred Stock will have certain rights under
Section 262 of the DGCL to dissent and demand appraisal of, and payment in
cash for the fair value of, that holder's shares of Common Stock, Series A
Preferred Stock and/or Series B Preferred Stock. Those rights, if the
statutory procedures are complied with, could lead to a judicial determination
of the fair value (excluding any value arising from the Merger) required to be
paid in cash to dissenting stockholders for their shares of Common Stock,
Series A Preferred Stock and/or Series B Preferred Stock. Any judicial
determination of the fair value of shares of Common Stock, Series A Preferred
Stock and/or Series B Preferred Stock could be based upon considerations other
than or in addition to the Offer Price and the market value of the shares of
Common Stock, Series A Preferred Stock and/or Series B Preferred Stock,
including asset values and the investment value of the shares of Common Stock,
Series A Preferred Stock and/or Series B Preferred Stock. The value so
determined could be more or less than the Offer Price. Failure to follow the
steps required by Section 262 of the DGCL for perfecting appraisal rights may
result in the loss of those rights.
If a holder who demands appraisal under Section 262 of the DGCL fails to
perfect, or effectively withdraws or loses, its right to appraisal, as
provided in the DGCL, the shares of Common Stock, Series A Preferred Stock
and/or Series B Preferred Stock of that holder will be converted into the
merger consideration in accordance with the Merger Agreement. A holder may
withdraw his demand for appraisal by delivering to the Purchaser a written
withdrawal of such demand for appraisal and acceptance of the Merger.
The foregoing summary of the rights of objecting holders does not purport to
be a complete statement of the procedures to be followed by holders desiring
to exercise any available dissenters' rights. The preservation and exercise of
dissenters' rights require strict adherence to the applicable provisions of
the DGCL.
Going Private Transactions. Rule 13e-3 under the Exchange Act is applicable
to certain "going-private" transactions. The Purchaser does not believe that
Rule 13e-3 will be applicable to the Merger, unless, among other things, the
Merger is completed more than one year after termination of the Offer. If
applicable, Rule 13e-3 would require, among other things, that certain
financial information regarding the Company and certain information regarding
the fairness of the Merger and the consideration offered holders of the
Company therein be filed with the Commission and disclosed to stockholders of
the Company prior to consummation of the Merger.
Regulatory Approvals.
(a) Antitrust--U.S.
Under the HSR Act and the rules that have been promulgated thereunder by the
Federal Trade Commission ("FTC"), certain mergers and acquisitions 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 Offer Securities by the Purchaser pursuant to the Offer is subject to the
HSR Act requirements.
Under the provisions of the HSR Act applicable to the purchase of Offer
Securities pursuant to the Offer, such purchase may not be made until the
expiration of a 15-calendar day waiting period following the required filing
of a Notification and Report Form under the HSR Act by Parent, which Parent
submitted on May 4, 1999. Accordingly, the waiting period under the HSR Act
will expire at 11:59 P.M., New York City time, on May 19, 1999, unless early
termination of the waiting period is granted or Parent receives a request for
additional information or documentary material prior thereto. If either the
FTC or the Antitrust Division were to request additional information or
documentary material from Parent prior to the expiration of the 15-day waiting
period, the waiting period would be extended and 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 or by consent of Parent. If the acquisition of
Offer Securities 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 purchase of and payment for Offer Securities pursuant to the
Offer will be deferred until 10
43
<PAGE>
days after the request is substantially complied with unless the waiting
period is terminated sooner by the FTC or the Antitrust Division (and assuming
all of the other Offer conditions have been satisfied or waived). See Section
2--"Acceptance for Payment and Payment for Offer Securities". Only one
extension of such waiting period pursuant to a request for additional
information or documentary material is authorized by the rules promulgated
under the HSR Act, except by court order or by consent. Although the Company
is required to file certain information and documentary material with the
Antitrust Division and the FTC in connection with the Offer, neither the
Company's failure to make such filings nor a request to the Company from the
Antitrust Division or the FTC for additional information or documentary
material will extend the waiting period. However, if the Antitrust Division or
the FTC raises substantive issues in connection with a proposed transaction,
the parties frequently engage in negotiations with the relevant governmental
agency concerning possible means of addressing these issues and may agree to
delay consummation of the transaction while such negotiations continue.
The Antitrust Division and the FTC frequently scrutinize the legality under
the antitrust laws of transactions such as the proposed acquisition of Offer
Securities by the Purchaser pursuant to the Offer. At any time before or after
the Purchaser's purchase of Offer Securities, either the Antitrust Division or
the FTC could take such action under the antitrust laws as it deems necessary
or desirable in the public interest, including seeking to enjoin the
acquisition of Offer Securities pursuant to the Offer or seeking divestiture
of Offer Securities acquired by the Purchaser or divestiture of substantial
assets of Parent, the Company or any of their respective subsidiaries. State
attorneys general may also bring legal action under the antitrust laws, and
private parties may bring such action under certain circumstances. Parent and
the Purchaser believe that the acquisition of Offer Securities by the
Purchaser will not violate the antitrust laws. Nevertheless, there can be no
assurance that a challenge to the Offer on antitrust grounds will not be made
or, if a challenge is made, what the result will be. See Section 14--
"Conditions of the Offer" for certain conditions to the Offer, including
conditions with respect to litigation and certain governmental actions.
(b) Antitrust--EC.
The EC Merger Regulation (Council Regulation No. 4064/89 of December 21,
1989, as amended) requires notification to the European Commission, within
seven days of the conclusion of an agreement to acquire a controlling interest
or the launch of a cash tender offer therefor, of all concentrations between
companies which are deemed to have a "Community dimension" because they exceed
certain global and European turnover thresholds. Such concentrations may not
be consummated until the European Commission, acting within fixed deadlines,
approves them as being "compatible with the common market". A concentration is
compatible with the common market if it does not create or strengthen a
dominant position as a result of which effective competition would be
significantly impeded in the European Economic Area (the "EEA"), or in a
substantial part of it.
The European Commission has exclusive competence for approving or
prohibiting concentrations with a Community dimension--however, it may, upon
request, refer the case to the national antitrust authority of a particular
member state if the concentration has a specific effect on the territory of
the requesting member state.
The notification involves the disclosure to the European Commission of
detailed information, especially regarding the structure of the relevant
markets and the parties' competitive position. Upon receipt of a notification,
the European Commission conducts a preliminary review with a maximum duration
of one month from notification, which may be extended to six weeks in certain
circumstances. This preliminary review concludes with a decision either to
approve the notified concentration (with or without conditions) or to initiate
an in-depth investigation if the concentration raises serious doubts as to its
compatibility with the common market. Such an in-depth investigation has a
maximum duration of four months, and must end with a European Commission
decision either approving the concentration (with or without conditions) or
prohibiting it. If the European Commission raises substantive issues in
connection with the proposed concentration, the parties may negotiate with the
European Commission to find a solution, which may take the form of an
undertaking to make structural modifications to the entity resulting from the
concentration on conditions and within a timeframe agreed with the European
Commission.
44
<PAGE>
Parent and the Company, including their respective affiliates, each conduct
substantial operations within the EEA and satisfy the applicable turnover
thresholds, with the result that the acquisition of Offer Securities will
amount to a concentration with a Community dimension and, therefore, be
subject to the requirement of notification to, and approval by, the European
Commission.
Parent and the Purchaser believe that the concentration effected by the
acquisition of the Offer Securities by the Purchaser will be considered to be
compatible with the common market, and approved by the European Commission
during the preliminary review phase. However, it cannot be ruled out that the
European Commission might seek to require structural undertakings as a
condition to its approval, and/or to open a second phase investigation to
examine serious doubts as regards compatibility with the common market.
(c) Australia Foreign Investment Review Board.
Australia's foreign investment policy is administered by the Federal
Treasurer under the Foreign Acquisitions and Takeovers Act 1975 and guidelines
and other requirements established by government statement. Under current
government directives, proposals to take over an offshore company with
Australian subsidiaries or assets valued over Australian Dollars 20 million or
exceeding half the global asset value may be subject to examination under the
foreign investment policy. The foreign investment policy states that offshore
takeovers of this nature normally do not raise issues which would be contrary
to Australia's national interest. The policy states that where issues are
raised the Australian government would normally seek to resolve any concerns
through consultation with the parties involved. An informal notification may
also be made to the Australian Competition and Consumer Commission, who will
analyze the effect of the proposal on competition using their Merger
Guidelines. These Guidelines consider factors such as market share, the spread
of market power and the impact imports have on the market. The Purchaser may,
after reviewing relevant information regarding the Company, determine to make
such notifications.
(d) FOCI Arrangement.
Pursuant to the NISP, when a United States facility which has security
clearances for classified information is acquired by a non-United States
entity, the clearances of that United States facility are invalidated by the
DoD unless the parties have entered into a FOCI mitigation arrangement
suitable to the DoD which either clears the foreign entity for access to the
classified information or sets up barriers to foreign access to the
information. WGSI has received a facility security clearance from the DSS
permitting it to receive classified data, and is involved in performance under
classified contracts.
In order for WGSI to maintain its facility security clearance following the
Purchaser's purchase of the Offer Securities, the Purchaser will be required
to enter into a FOCI mitigation arrangement with the DoD in the form of either
a proxy agreement, voting trust agreement or special security agreement, each
of which will limit the Purchaser's control over and access to WGSI. If the
Purchaser does not conclude a suitable FOCI mitigation arrangement with the
DoD prior to the Expiration Date, the existing facility security clearances of
WGSI will be invalidated by the DoD until such time as the FOCI mitigation
arrangement has been concluded. Until such time, WGSI will be able to continue
performance under classified contracts unless one or more agencies object to
such continued performance, but no new security clearances will be granted to
WGSI.
(e) Exon-Florio.
As part of the Omnibus Trade and Competitiveness Act of 1988, a new Section
(the "Exon-Florio Amendment") was added to Title VII of the Defense Production
Act of 1950, 50 U.S.C. App. 2158, et seq. (the "DPA Act"), to empower the
President or his designee to take certain actions in relation to mergers,
acquisitions and takeovers by foreign persons which could result in foreign
control of a person engaged in interstate commerce in the United States. In
particular, the Exon-Florio Amendment enables the President to suspend or
prohibit any acquisitions by foreign persons which threaten to impair the
national security of the United States, and to divest such transactions that
have been concluded.
45
<PAGE>
Under the terms of the Exon-Florio Amendment, a foreign company or United
States subsidiary of a foreign company acquiring a United States company may
notify the Committee on Foreign Investment in the United States ("CFIUS") of
the proposed transaction, whereupon the CFIUS or the President must decide
within 30 days whether to investigate the transaction. On May 7, 1999, the
Purchaser filed a notification with CFIUS pursuant to Section 721 of the DPA
Act. CFIUS has 30 days from the date of filing of the completed notice to make
a determination as to whether an investigation is necessary. If an
investigation is undertaken of the proposed transaction and CFIUS determines
that United States national security may be impaired by the proposed
transaction, then CFIUS may recommend to the President that he suspend or
prohibit the transaction, or direct the United States Attorney General to seek
divestment relief in United States district court. The Purchaser does not
believe that the Offer threatens to impair the national security of the United
States.
16. Fees and Expenses. Except as set forth below, neither Parent nor the
Purchaser will pay any fees or commissions to any broker, dealer or other
person for soliciting tenders of Offer Securities pursuant to the Offer.
Merrill Lynch is acting as the Dealer Manager in connection with the Offer
and ABN AMRO Bank N.V. and Merrill Lynch are acting as financial advisors to
the Purchaser in connection with the Purchaser's proposed acquisition of the
Company. Each of ABN AMRO Bank N.V. and Merrill Lynch will receive reasonable
and customary compensation for their respective services as Dealer Manager
and/or financial advisor as the case may be, will be reimbursed for certain
reasonable out-of-pocket expenses and will be indemnified against certain
liabilities and expenses in connection therewith, including certain
liabilities under the United States federal securities laws.
The Purchaser and Parent have also retained Citibank, N.A., as the
Depositary. The Depositary has not been retained to make solicitations or
recommendations in its role as Depositary. The Depositary will receive
reasonable and customary compensation for its services, will be reimbursed for
certain reasonable out-of-pocket expenses and will be indemnified against
certain liabilities and expenses in connection therewith, including certain
liabilities under the United States federal securities laws.
In addition, the Purchaser and Parent have retained Morrow & Co., Inc. to
act as the Information Agent in connection with the Offer. The Information
Agent will receive reasonable and customary compensation for its services,
will be reimbursed for certain reasonable out-of-pocket expenses and will be
indemnified against certain liabilities and expenses in connection therewith,
including certain liabilities under the United States federal securities laws.
Brokers, dealers, commercial banks and trust companies will be reimbursed by
the Purchaser for customary mailing and handling expenses incurred by them in
forwarding offering material to their customers.
17. Miscellaneous. The Purchaser is not aware of any jurisdiction where the
making of the Offer is prohibited by any administrative or judicial action
pursuant to any valid state statute. If the Purchaser becomes aware of any
valid state statute prohibiting the making of the Offer or the acceptance of
the Offer Securities pursuant thereto, the Purchaser will make a good faith
effort to comply with such state statute or seek to have such statute declared
inapplicable to the Offer. If, after such good faith effort, the Purchaser
cannot comply with any such state statute, the Offer will not be made to (and
tenders will not be accepted from or on behalf of) the holders of Offer
Securities in such state. 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 one or more registered brokers or dealers which are licensed under
the laws of such jurisdiction.
No person has been authorized to give any information or make any
representation on behalf of Parent or the Purchaser not contained in this
Offer to Purchase or in the Letters of Transmittal and, if given or made, such
information or representation must not be relied upon as having been
authorized.
46
<PAGE>
Parent and the Purchaser have filed with the Commission the Schedule 14D-1,
together with exhibits, pursuant to Section 14(d)(1) of the Exchange Act and
Rule 14d-3 promulgated thereunder, furnishing certain additional information
with respect to the Offer, and may file amendments thereto. 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 manner set forth in
Section 7--"Certain Information Concerning the Company" (except that they will
not be available at the regional offices of the Commission).
Getronics Acquisition, Inc.
May 10, 1999
47
<PAGE>
SCHEDULE I
INFORMATION CONCERNING THE DIRECTORS AND EXECUTIVE
OFFICERS OF GETRONICS NV AND
GETRONICS ACQUISITION, INC.
1. SUPERVISORY BOARD, BOARD OF MANAGEMENT AND EXECUTIVE OFFICERS OF
GETRONICS NV.
Set forth below is the name, present principal occupation or employment and
material occupations, positions, offices or employments for the past five
years of each member of the Supervisory Board, the Board of Management and
each executive officer of Getronics NV. The principal address of Getronics NV
and, unless indicated below, the current business address for each individual
listed below is Donauweg 10, 1043 AJ Amsterdam, P.O. Box 652, 1000 Amsterdam,
The Netherlands, Telephone: 011-31-20-5861412. Each such person is, unless
indicated below, a citizen of The Netherlands. Members of the Supervisory
Board are identified by an asterisk and members of the Board of Management are
identified by two asterisks.
<TABLE>
<CAPTION>
Name and Current Present Principal Occupation or Employment;
Business Address Material Positions Held During the Past Five Years
---------------- ----------------------------------------------------
<C> <S>
H. Langman*...................... Chairman of the Supervisory Board of Getronics NV;
President
of the Supervisory Board of NV Elektr.Prod.mij. Oost-en
Noord-Nederland; President of the Supervisory Board of
HAL Holding
NV; President of the Supervisory Board of IHC Caland
NV; President of the Supervisory Board of NV Petroleum-
Mij.
"Moeara-Enim"; President of the Supervisory Board of
OTRA NV; President of the Supervisory Board of van
Lanschot Bankiers; President of the Supervisory Board
of Siemens Nederland; President of the Supervisory
Board of Vendex International NV; President of the
Supervisory Board of Holland Chemical Int. NV; Member
of the Supervisory Board of Sonepar Distribution;
Member of the Supervisory Board of Oranje-Nassau Group
BV
P. Bouw*......................... Member of the Supervisory Board of Getronics NV; Former
CEO of KLM NV; Member of the Supervisory Board of De
Nederlandsche Bank NV; Member of the Supervisory Board
of NV Nederlandse Spoorwegen; Member of the Supervisory
Board of Koninklijke Pakhoed NV; Member of the
Supervisory Board of Oce NV
N.G. Ketting*.................... Member of the Supervisory Board of Getronics NV;
President of the Supervisory Board of Holec Holland NV;
President of the Supervisory Board of NV AVIRA; Member
of the Supervisory Board of NKF Holding NV; Member of
the Supervisory Board of Koninklijke Gist-Brocades NV
M.Ververs*....................... Member of the Supervisory Board of Getronics NV; Former
CEO of Wolters Kluwer NV; Member of the Supervisory
Board of Oce NV; Member of the Supervisory Board of
Koninklijke Sphinx Gustavsberg NV; Member of the
Supervisory Board of CSM NV; Member of the Supervisory
Board of De Boer Unigro NV; Member of the Supervisory
Board of Rijnconsult BV; Member of the Supervisory
Board of ING Group NV
</TABLE>
I-1
<PAGE>
<TABLE>
<CAPTION>
Name and Current Present Principal Occupation or Employment;
Business Address Material Positions Held During the Past Five Years
---------------- ----------------------------------------------------
<C> <S>
C.G. van Luijk**................. President and Chief Executive Officer of Getronics NV;
Chairman of the Board of Management of Getronics NV;
Director and President of Getronics Acquisition, Inc.;
Former CEO of Pricewaterhouse- Coopers NV; Former
Global Middle Market Leader of PricewaterhouseCoopers
Global Organization
P.K. van Voorst**................ Member of the Board of Management and Senior Vice
President of Getronics NV; Director and Secretary of
Getronics Acquisition, Inc.
J.L. Docter**.................... Member of the Board of Management and Chief Financial
Officer of Getronics NV; Director and Treasurer of
Getronics Acquisition, Inc.
R.W.M. Kropholler**.............. Member of the Board of Management and Director of Human
Resources of Getronics NV; Former Manager of Human
Resources of Philips NV; Former Manager of Human
Resources of AT&T; Former Group Director of Human
Resources of Origin International BV
L.J.E. Smits**................... Member of the Board of Management and Director of
Corporate Accounts of Getronics NV; Former Member of
the Board of Management of Berenschot BV
</TABLE>
2. DIRECTORS AND EXECUTIVE OFFICERS OF GETRONICS ACQUISITION, INC.
Set forth below is the name, present principal occupation or employment and
material occupations, positions, offices or employments for the past five
years of each director and executive officer of Getronics Acquisition, Inc.
Each person identified below has held his position since the formation of
Getronics Acquisition, Inc. on April 30, 1999. The principal address of
Getronics Acquisition, Inc. is 1013 Centre Road, Wilmington, Delaware 19805,
Telephone: (800) 927-9800. The current business address for each individual
listed below is Donauweg 10, 1043 AJ Amsterdam, P.O. Box 652, 1000 Amsterdam,
The Netherlands, Telephone: 011-31-20-5861412. Each such person is, unless
indicated below, a citizen of The Netherlands. Directors are identified by an
asterisk.
<TABLE>
<CAPTION>
Name and Current Present Principal Occupation or Employment;
Business Address Material Positions Held During the Past Five Years
---------------- ----------------------------------------------------
<C> <S>
C.G. van Luijk*.................. Director and President of Getronics Acquisition, Inc.;
President and Chief Executive Officer of Getronics NV;
Chairman of the Board of Management of Getronics NV;
Former CEO of Pricewaterhouse Coopers NV; Former Global
Middle Market Leader of PricewaterhouseCoopers Global
Organization
J.L. Docter*..................... Director and Treasurer of Getronics Acquisition, Inc.;
Chief Financial Officer of Getronics NV
P.K. van Voorst*................. Director and Secretary of Getronics Acquisition, Inc.;
Senior Vice President of Getronics NV
F.A.R.N. Kleipool................ Director of Corporate Planning of Getronics NV; Former
Financial Director of RAET N.V.; Director of Getronics
Acquisition, Inc.
S.A. van Maasakker*.............. Director of Getronics Acquisition, Inc.; Corporate
Secretary and Head Legal Counsel of Getronics NV;
Former Corporate Secretary and Legal Counsel of KNP
LEYKAM Austria AG; Former Legal Counsel of Buhrmann
M. Kimmel*....................... Director of Getronics Acquisition, Inc.; Director of
Personnel & Organization of Getronics Maintenance &
Installation; Director of Personnel & Organization of
Getronics Networks & Services
A. Smeding*...................... Director of Getronics Acquisition, Inc.; Manager Group
Accounting & Consolidation of Getronics NV; Manager
Group Reporting & Information of Getronics NV
</TABLE>
I-2
<PAGE>
3. OWNERSHIP OF OFFER SECURITIES BY DIRECTORS AND EXECUTIVE OFFICERS.
To the best knowledge of Getronics NV, and Getronics Acquisition, Inc., none
of the persons listed on this Schedule I beneficially owns or has a right to
acquire directly or indirectly any Offer Securities, and none of the persons
listed on this Schedule I has effected any transactions in the Offer
Securities during the past 60 days.
I-3
<PAGE>
Copies of the Letters of Transmittal, properly completed and duly signed,
will be accepted. The Letters of Transmittal, certificates for the Offer
Securities and any other required documents should be sent by each holder of
Offer Securities or such holder's broker, dealer, commercial bank, trust
company or other nominee to the Depositary at one of the addresses set forth
below:
The Depositary for the Offer is:
Citibank, N.A.
By Hand: By Mail: By Overnight Courier:
Citibank, N.A. Citibank, N.A. Citibank, N.A.
Corporate Actions Corporate Actions Corporate Actions
111 Wall Street, P.O. Box 2544 525 Washington Boulevard
5th Floor Window Jersey City, New Jersey Suite 4660
New York, New York 10043 07303-2544 Jersey City, New Jersey
07303
For Information:
(877) 248-4237
Questions and requests for assistance may be directed to the Information
Agent or the Dealer Manager at their respective addresses and telephone
numbers as set forth below. Additional copies of this Offer to Purchase, the
Letters of Transmittal, or other related tender offer materials may be
obtained from the Information Agent or from brokers, dealers, commercial banks
or trust companies.
The Information Agent for the Offer is:
MORROW & CO., INC.
445 Park Avenue
5th Floor
New York, New York 10022
Call Collect (212) 754-8000
Toll Free: (800) 566-9061
Bankers and Brokerage Firms, Please Call: (800) 662-5200
Stockholders, Please Call: (800) 566-9061
The Dealer Manager for the Offer is:
Merrill Lynch & Co.
World Financial Center
North Tower
New York, New York 10281-1305
(212) 449-8971 (Call Collect)
<PAGE>
Exhibit (a)(2)
LETTER OF TRANSMITTAL
To Tender
Shares of Common Stock (Including the Associated Rights), Shares of 6 1/2%
Series B Cumulative Convertible Preferred Stock, Depositary Shares (each
representing a 1/20th interest in a share of 6 1/2% Series B Cumulative
Convertible Preferred Stock) and/or Common Stock Purchase Warrants
of
Wang Laboratories, Inc.
Pursuant to the Offer to Purchase
Dated May 10, 1999
by
Getronics Acquisition, Inc.
a wholly-owned subsidiary of
Getronics NV
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON MONDAY, JUNE 7, 1999, UNLESS THE OFFER IS EXTENDED.
The Depositary for the Offer is:
Citibank, N.A.
<TABLE>
<S> <C> <C>
By Hand: By Mail: By Overnight Courier:
Citibank, N.A. Citibank, N.A. Citibank, N.A.
Corporate Actions Corporate Actions Corporate Actions
111 Wall Street, 5th Floor Window P.O. Box 2544 525 Washington Boulevard, Suite 4660
New York, New York 10043 Jersey City, New Jersey 07303-2544 Jersey City, New Jersey 07303
</TABLE>
For Information:
(877) 248-4237
DESCRIPTION OF OFFER SECURITIES TENDERED
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Name(s) and Address(es) of Registered Holder(s)
(Pease fill in, if blank, exactly as name(s) appear(s)l Offer Securities Tendered
on the certificate(s)) (Attach additional list if necessary)
----------------------------------------------------------------------------------------------------------
Total Number of
Offer Securities
Offer Security Evidenced by Number
Certificate Offer Security of Offer Securities
Number(s) Certificate(s) Tendered:*
------------------------------------------------------------------
------------------------------------------------------------------
------------------------------------------------------------------
------------------------------------------------------------------
------------------------------------------------------------------
------------------------------------------------------------------
<S> <C> <C> <C>
Total Offer Securities
Tendered......................
</TABLE>
- --------------------------------------------------------------------------------
* Unless otherwise indicated, it will be assumed that all Offer Securities
evidenced by any Offer Security Certificate(s) delivered to the
Depositary are being tendered. See Instruction 4.
<PAGE>
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE WILL NOT CONSTITUTE A VALID DELIVERY TO THE DEPOSITARY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
This Letter of Transmittal is to be completed by holders of certificates
representing (i) shares of Common Stock, (ii) shares of Series B Preferred
Stock, (iii) Depositary Shares and/or (iv) Common Stock Purchase Warrants (as
such terms are defined in the Offer to Purchase and, collectively, the "Offer
Securities") (such holders of Offer Securities, collectively, the "Holders").
If you hold Offer Securities in book-entry form, you may tender your Offer
Securities by book-entry transfer to the account maintained by the Depositary
at The Depository Trust Company ("DTC") (the "Book-Entry Transfer Facility"),
along with an Agent's Message (as defined in the Offer to Purchase), pursuant
to the procedures set forth in Section 3--"Procedures for Tendering Offer
Securities" of the Offer to Purchase. Holders who tender Offer Securities by
book-entry transfer are referred to herein as "Book-Entry Holders" and other
Holders are referred to herein as "Certificate Holders."
Holders whose certificates evidencing Offer Securities (the "Offer Security
Certificates") are not immediately available or who cannot deliver their Offer
Security Certificates and all other documents required hereby to the
Depositary on or prior to the Expiration Date (as defined in Section 1--"Terms
of the Offer" of the Offer to Purchase), or who cannot comply with the book-
entry transfer procedures on a timely basis, may nevertheless tender their
Offer Securities according to the guaranteed delivery procedure set forth in
Section 3--"Procedures for Tendering Offer Securities" of the Offer to
Purchase. See Instruction 2 of this Letter of Transmittal. DELIVERY OF
DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO
THE DEPOSITARY.
[_]CHECK HERE IF THE OFFER SECURITIES ARE BEING TENDERED PURSUANT TO A NOTICE
OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE
FOLLOWING:
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 ___________________________
[_]CHECK HERE IF TENDER IS BEING MADE OF LOST OR MUTILATED SECURITIES. SEE
INSTRUCTION 9.
NOTE: SIGNATURES MUST BE PROVIDED BELOW
2
<PAGE>
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
Ladies and Gentlemen:
The undersigned hereby tenders to Getronics Acquisition, Inc. (the
"Purchaser"), a Delaware corporation and a wholly-owned subsidiary of
Getronics NV, a public company with limited liability incorporated under the
laws of The Netherlands with its corporate seat in Amsterdam, The Netherlands
("Parent"), (i) the above-described shares of common stock, par value $0.01
per share, including the associated rights ("Common Stock"), (ii) the above-
described shares of 6 1/2% Series B Cumulative Convertible Preferred Stock,
par value $0.01 per share ("Series B Preferred Stock"), (iii) the above-
described depositary shares, each representing a 1/20th interest in a share of
Series B Preferred Stock ("Depositary Shares") and/or (iv) the above-described
warrants, other than the Special Common Stock Warrant (as defined in the Offer
to Purchase), to purchase shares of Common Stock ("Common Stock Purchase
Warrants" and together with Common Stock, Series B Preferred Stock and
Depositary Shares, the "Offer Securities") of Wang Laboratories, Inc., a
company organized under the laws of Delaware (the "Company") upon the terms
and subject to the conditions set forth in the Offer to Purchase dated May 10,
1999 (the "Offer to Purchase"), receipt of which is hereby acknowledged, and
in this Letter of Transmittal (which, as may be amended and supplemented from
time to time, together with the Offer to Purchase, constitutes the "Offer").
The undersigned understands that the Purchaser reserves the right to assign to
an affiliate of the Parent the right to purchase all or any portion of the
Offer Securities tendered pursuant to the Offer, but the undersigned further
understands that any such assignment will not relieve the Purchaser of its
obligations under the Offer and will in no way prejudice the rights of
tendering Holders to receive payment for the Offer Securities validly tendered
and accepted for payment pursuant to the Offer.
Upon the terms and subject to the conditions of the Offer, subject to, and
effective upon, acceptance for payment of and payment for the Offer Securities
tendered herewith in accordance with the terms of the Offer (including, if the
Offer is extended or amended, the terms and conditions of 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 of
the Offer Securities that are being tendered hereby and any and all dividends,
distributions, rights, or other securities issued or issuable in respect of
such Offer Securities on or after May 3, 1999 (collectively, "Distributions"),
and appoints the Depositary the true and lawful agent and attorney-in-fact of
the undersigned with respect to such Offer Securities and all Distributions
with full power of substitution (such power of attorney being deemed to be an
irrevocable power coupled with an interest) to (a) transfer ownership of such
Offer Securities and all Distributions, together with all accompanying
evidences of transfers and authenticity, to or upon the order of the
Purchaser, (b) present such Offer Securities and all Distributions for
transfer on the books of the Company and (c) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Offer Securities
and all Distributions, all in accordance with the terms and subject to the
conditions of the Offer as set forth in the Offer to Purchase.
The undersigned hereby irrevocably appoints each designee of the Purchaser
as such attorney-in-fact and proxy of the undersigned, with full power of
substitution, to vote in such manner as each such attorney-in-fact and proxy
(or any substitute thereof) shall deem proper in its sole discretion, and to
otherwise act (including pursuant to written consent) to the full extent of
the undersigned's rights with respect to the Offer Securities and all
Distributions tendered hereby and accepted for payment by the Purchaser prior
to the time of such vote or action. All such proxies shall be considered
coupled with an interest in the tendered Offer Securities and shall be
irrevocable and are granted in consideration of, and is effective upon, the
acceptance for payment of such Offer Securities and all Distributions by the
Purchaser in accordance with the terms of the Offer. Such acceptance for
payment by the Purchaser shall revoke, without further action, any other proxy
or power of attorney granted by the undersigned at any time with respect to
such Offer Securities and all Distributions and no subsequent proxies or
powers of attorney will be given (or, if given, will not be deemed effective)
with respect thereto by the undersigned. The designees of the Purchaser will,
with respect to the Offer Securities, rights or other securities for which the
appointment is effective, be empowered to exercise all voting and other rights
as they in their sole discretion may deem proper at any annual, special,
adjourned or postponed meeting of the Company's stockholders, by written
consent or otherwise, and the Purchaser reserves the right to require that, in
order for the Offer Securities, rights or other securities to be deemed
validly tendered, immediately upon the Purchaser's acceptance for payment of
such Offer Securities, the Purchaser must be able to exercise all rights
(including, without limitation, all voting rights and rights of conversion)
with respect to such Offer Securities, rights or other securities and receive
all dividends and distributions.
3
<PAGE>
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, sell, assign and transfer the Offer Securities
and all Distributions tendered hereby and that, when the same are accepted for
payment by the Purchaser, the Purchaser will acquire good, marketable and
unencumbered title thereto, free and clear of all liens, restrictions, charges
and encumbrances, and the same will not be subject to any adverse claim. The
undersigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or the Purchaser to be necessary or desirable to
complete the sale, assignment, and transfer of the Offer Securities and all
Distributions tendered hereby. In addition, the undersigned shall promptly
remit and transfer to the Depositary for the account of the Purchaser any and
all Distributions in respect of the Offer Securities tendered hereby,
accompanied by appropriate documentation of transfer and, pending such
remittance or appropriate assurance thereof, the Purchaser shall be entitled
to all rights and privileges as owner of any such Distributions and may
withhold the entire purchase price or deduct from the purchase price the
amount or value thereof, 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, personal representatives, successors and assigns of the
undersigned. Subject to the withdrawal rights set forth in Section 4--
"Withdrawal Rights" of the Offer to Purchase, the tender of the Offer
Securities and related Distributions hereby made is irrevocable.
The undersigned understands that tenders of the Offer Securities pursuant to
any of the procedures described in Section 3--"Procedures for Tendering Offer
Securities" of the Offer to Purchase and in the instructions hereto will
constitute the undersigned's acceptance of the terms and conditions of the
Offer. The Purchaser's acceptance for payment of such Offer Securities will
constitute a binding agreement between the undersigned and the Purchaser upon
the terms and subject to the conditions set forth in the Offer. The
undersigned recognizes that under certain circumstances set forth in the Offer
to Purchase, the Purchaser may not be required to accept for payment any of
the Offer Securities tendered hereby.
Unless otherwise indicated herein under "Special Payment Instructions,"
please issue the check for the purchase price and/or return any certificates
evidencing Offer Securities ("Offer Security Certificates") not tendered or
not accepted for payment in the name(s) of the registered holder(s) appearing
under "Description of Offer Securities Tendered." Similarly, unless otherwise
indicated under "Special Delivery Instructions," please mail the check for the
purchase price and/or return any Offer Security Certificates not tendered or
not accepted for payment (and accompanying documents, as appropriate) to the
address(es) of the registered holder(s) appearing under "Description of Offer
Securities Tendered." In the event that both the Special Delivery Instructions
and the Special Payment Instructions are completed, please issue the check for
the purchase price and/or issue any Offer Security Certificates not so
tendered or accepted for payment in the name of, and deliver said check and/or
return such Offer Security Certificates to, the person or persons so
indicated. The undersigned recognizes that the Purchaser has no obligation,
pursuant to the Special Payment Instructions, to transfer any Offer Securities
from the name of the registered holder thereof if the Purchaser does not
accept for payment any of the Offer Securities so tendered.
4
<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 To be completed ONLY if
certificate(s) for Offer certificate(s) for Offer
Securities not tendered or not Securities not tendered or not
purchased and/or the check for purchased and/or the check for
the purchase price of Offer the purchase price of Offer
Securities purchased are to be Securities purchased are to be
issued in the name of someone sent to someone other than the
other than the undersigned. undersigned, or to the
undersigned at an address other
than that shown above.
Issue check and/or certificate(s)
to:
Name: ____________________________
Mail check and/or certificate(s)
to:
Please Type or Print
Address: _________________________ Name: ___________________________
Please Type or Print
__________________________________
(Include Zip Code) Address: ________________________
_________________________________* _________________________________
(Tax Identification or Social (Include Zip Code)
Security No.) _________________________________
(See Substitute Form W-9 Included (Tax Identification or Social
Herewith) Security No.)
__________________________________ (See Substitute Form W-9
* Signature Guarantee required Included Herewith)
5
<PAGE>
IMPORTANT
HOLDER(S) SIGN HERE
(See Instructions 1 and 5)
(Please Complete Substitute Form W-9 Contained Herein)
Signature(s) of Holder(s): _____________________________________________________
Date: _________________________ , 1999
- --------------------------------------
(Tax Identification or Social
Security No.)
(Must be signed by registered holder(s) exactly as name(s) appear(s) on Offer
Security Certificate(s) or on a security position listing or by person(s)
authorized to become registered holder(s) by certificate(s) and documents
transmitted with this Letter of Transmittal. If signature is by trustees,
executors, administrators, guardians, attorneys-in-fact, officers of
corporations or other persons acting in a fiduciary or representative capacity,
please provide the following information and see Instruction 5.)
Name(s): _______________________________________________________________________
(Please Print)
Capacity (Full Title): _________________________________________________________
Address: _______________________________________________________________________
- --------------------------------------------------------------------------------
(Include Zip Code)
- --------------------------------------------------------------------------------
(Area Code and Telephone No.)
GUARANTEE OF SIGNATURE(S)
(See Instructions 1 and 5)
Authorized Signature: __________________________________________________________
Name: __________________________________________________________________________
(Please Type or Print)
Title: _________________________________________________________________________
Name of Firm: __________________________________________________________________
Address: _______________________________________________________________________
- --------------------------------------------------------------------------------
(Include Zip Code)
Name of Firm: __________________________________________________________________
Area Code and Telephone Number: ________________________________________________
Date: _________________________ , 1999
6
<PAGE>
INSTRUCTIONS
Forming Part of the Terms and Conditions of the Offer
1. Guarantee of Signatures. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a financial
institution (including most banks, savings and loan associations and brokerage
houses) which is a participant in the Security Transfer Agents Medallion
Program, The New York Stock Exchange Medallion Signature Guarantee Program or
the Stock Exchange Medallion Program (an "Eligible Institution"). Signatures
on this Letter of Transmittal need not be guaranteed (a) if this Letter of
Transmittal is signed by the registered Holder(s) of the Offer Securities
tendered herewith and such Holder(s) have not completed the box entitled
"Special Payment Instructions" on this Letter of Transmittal or (b) if such
Offer Securities are tendered for the account of an Eligible Institution. See
Instruction 5 of this Letter of Transmittal.
2. Delivery of Letter of Transmittal and Offer Security Certificates or
Book-Entry Confirmations. This Letter of Transmittal is to be used if Offer
Security Certificates are to be forwarded herewith. Offer Security
Certificates evidencing all physically tendered Offer Securities along with
this Letter of Transmittal (or a copy thereof), properly completed and duly
executed with any required signature guarantees, and any other documents
required by this Letter of Transmittal, must be received by the Depositary at
one of its addresses set forth herein on or prior to the Expiration Date (as
defined in Section 1--"Terms of the Offer" of the Offer to Purchase). Offer
Securities held through DTC must be tendered to the Depositary by means of
delivery of an Agent's Message (as more fully described in the Offer to
Purchase). The Depositary Shares may be tendered only means of Book-Entry
Transfer (as such securities have been issued only in book-entry form).
Holders whose Offer Security Certificates are not immediately available or
who cannot deliver their Offer Security Certificates and all other required
documents to the Depositary on or prior to the Expiration Date or who cannot
complete the procedures for book-entry transfer on a timely basis may
nevertheless tender their Offer Securities by properly completing and duly
executing a Notice of Guaranteed Delivery pursuant to the guaranteed delivery
procedure set forth in Section 3--"Procedures for Tendering Offer Securities"
of the Offer to Purchase. Pursuant to such procedure: (i) such tender must be
made by or through an Eligible Institution; (ii) a properly completed and duly
executed Notice of Guaranteed Delivery, substantially in the form provided by
the Purchaser, must be received by the Depositary on or prior to the
Expiration Date; and (iii) Offer Security Certificates, as well as a Letter of
Transmittal, properly completed and duly executed with any required signature
guarantees, and all other documents required by this Letter of Transmittal
must be received by the Depositary within three New York Stock Exchange
trading days after the date of execution of such Notice of Guaranteed
Delivery.
If Offer Security Certificates are forwarded to the Depositary in multiple
deliveries, a properly completed and duly executed Letter of Transmittal (or a
copy thereof) must accompany each such delivery.
The method of delivery of this Letter of Transmittal, Offer Security
Certificates and all other required documents, including delivery through the
Book-Entry Transfer Facility, where applicable, is at the election and risk of
the tendering Holder. Delivery will be deemed made only when actually received
by the Depositary. If such delivery is by mail, registered mail with return
receipt requested, properly insured, is recommended. In all cases, sufficient
time should be allowed to assure timely delivery.
No alternative, conditional or contingent tenders will be accepted and no
fractional Offer Securities will be purchased. All tendering Holders, by
execution of this Letter of Transmittal (or a copy hereof), waive any right to
receive any notice of the acceptance of their Offer Securities for payment.
3. Inadequate Space. If the space provided under "Description of Offer
Securities Tendered" is inadequate, the Offer Security Certificate numbers
and/or the number of Offer Securities should be listed on a separate schedule
and attached hereto.
4. Partial Tenders (Applicable to Holders of Offer Security Certificates
Only). If fewer than all the Offer Securities evidenced by any Offer Security
Certificate submitted are to be tendered, fill in the number of Offer
Securities which are to be tendered in the box entitled "Number of Offer
Securities Tendered." In such cases, new Offer Security
7
<PAGE>
Certificate(s) evidencing the remainder of the Offer Securities that were
evidenced by Offer Security Certificate(s) delivered to the Depositary will be
sent to the person 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 Offer
Securities represented by Offer Security 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 Holders of the Offer
Securities tendered hereby, the signatures must correspond with the names as
written on the face of the Offer Security Certificates without alteration,
enlargement or any change whatsoever.
If any of the Offer Securities tendered hereby are owned of record by two or
more joint owners, all such owners must sign this Letter of Transmittal.
If any of the tendered Offer Securities are registered in different names on
several Offer Security Certificates, it will be necessary to complete, sign
and submit as many separate Letters of Transmittal as there are different
registrations of the Offer Securities.
If this Letter of Transmittal or any Offer Security Certificate or stock
power is signed by a trustee, executor, administrator, 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
evidence satisfactory to the Depositary and the Purchaser of such person's
authority so to act must be submitted.
If this Letter of Transmittal is signed by the registered holder(s) of the
Offer Securities transmitted hereby, no endorsements of Offer Security
Certificates or separate stock powers are required unless payment is to be
made to, or Offer Security Certificates evidencing the Offer Securities not
tendered or purchased are to be issued in the name of, a person other than the
registered holder(s). Signatures on such Offer Security Certificates or stock
powers must be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered holder of the Offer Securities tendered hereby, the Offer Security
Certificate(s) must be endorsed or accompanied by appropriate stock powers, in
either case signed exactly as the name or names of the registered holder or
holders appear(s) on such Offer Security Certificate(s). Signatures on such
Offer Security Certificates or stock powers must be guaranteed by an Eligible
Institution.
6. Transfer Taxes. Except as otherwise provided in this Instruction 6, the
Purchaser will pay or cause to be paid any transfer taxes with respect to the
transfer and sale of purchased Offer Securities to it or its order pursuant to
the Offer. If, however, payment of the purchase price of any Offer Securities
purchased is to be made to or, in the circumstances permitted hereby, if Offer
Security Certificates for the Offer Securities not tendered or purchased are
to be registered in the name of any person other than the registered holder,
or if tendered Offer Security Certificates are registered in the name of any
person other than the person(s) signing this Letter of Transmittal, the amount
of any transfer taxes (whether imposed on the registered holder or such
person) payable on account of the transfer to such person will be deducted
from the purchase price if satisfactory evidence of the payment of such taxes,
or exemption therefrom, is not submitted.
Except as provided in this Instruction 6, it will not be necessary for
transfer tax stamps to be affixed to the Offer Security Certificates listed in
this Letter of Transmittal.
7. Special Payment and Delivery Instructions. If a check for the purchase
price is to be issued in the name of, and/or Offer Security Certificates for
the Offer Securities not tendered or not accepted for payment are to be issued
in the name of a person other than the signer of this Letter of Transmittal or
if a check and/or such Offer Security Certificates are to be mailed to someone
other than the signer of this Letter of Transmittal or to an address other
than that shown above, the appropriate boxes on this Letter of Transmittal
should be completed.
8. Requests for Assistance or Additional Copies. Questions or requests for
assistance may be directed to, or additional copies of the Offer to Purchase,
this Letter of Transmittal, the Notice of Guaranteed Delivery and other tender
offer materials may be obtained from, the Information Agent or the Dealer
Manager at their respective addresses set forth on the back cover of the Offer
to Purchase or from your broker, dealer, commercial bank or trust company.
8
<PAGE>
9. Lost or Destroyed Offer Security Certificates. If any Offer Security
Certificates have been lost or destroyed, the Holder should promptly notify
the Company's transfer agent, American Stock Transfer and Trust Company at
(212) 936-5100. The Holder will then be instructed as to the procedure to be
followed in order to replace the relevant Offer Security Certificates. This
Letter of Transmittal and related documents cannot be processed until the
procedures for replacing lost or destroyed Offer Security Certificates have
been followed.
IMPORTANT TAX INFORMATION
Under United States federal income tax law, a tendering Holder may be
subject to backup withholding tax at a rate of 31% with respect to payments by
the Depositary pursuant to the Offer unless such Holder (i) is a corporation
or other exempt recipient and, if required, establishes its exemption from
backup withholding, (ii) provides its correct taxpayer identification number
("TIN"), certifies that it is not currently subject to backup withholding and
otherwise complies with applicable requirements of the backup withholding
rules, or (iii) certifies as to its non-United States status. Completion of a
Substitute Form W-9, in the case of a U.S. Holder, provided in this Letter of
Transmittal should be used for this purpose. Failure to provide such Holder's
TIN on the Substitute Form W-9, if applicable, may subject the tendering
Holder (or other payee) to a $50 penalty imposed by the Internal Revenue
Service ("IRS"). More serious penalties may be imposed for providing false
information which, if willfully done, may result in fines and/or imprisonment.
The box in part 3 of the Substitute Form W-9 may be checked if the tendering
Holder (or other payee) is required to submit a Substitute Form W-9 and has
not been issued a TIN and has applied for a TIN or intends to apply for a TIN
in the near future. If the box in Part 3 is so checked and the Depositary is
not provided with a TIN by the time of payment, the Depositary will withhold
31% on all such payments of the Offer Price until a TIN is provided to the
Depositary. In order for a foreign Holder to qualify as an exempt recipient,
that Holder should submit an IRS Form W-8 or a Substitute Form W-8, signed
under penalties of perjury, attesting to that Holder's exempt status. Such
forms can be obtained from the Depositary. Failure to provide the information
on the form may subject tendering Holders to 31% United States federal income
tax withholding on the payment of the purchase price of cash pursuant to the
Offer.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A COPY HEREOF) TOGETHER WITH OFFER
SECURITY CERTIFICATES AND ALL OTHER REQUIRED DOCUMENTS OR THE
NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY ON
OR PRIOR TO THE EXPIRATION DATE.
9
<PAGE>
TO BE COMPLETED BY ALL TENDERING HOLDERS
PAYER'S NAME: Citibank, N.A.
- --------------------------------------------------------------------------------
Part 1--PLEASE PROVIDE YOUR
TIN IN THE BOX AT RIGHT AND ----------------------
CERTIFY BY SIGNING AND Social Security Number
DATING BELOW
SUBSTITUTE OR
Form W-9
Department of ----------------------
the Treasury Employer Identification
Internal Number
Revenue ----------------------------------------------------------
Service Part 2--If you are Part 3--If you are
exempt from backup awaiting your TIN,
withholding, please please check the
check the box: [_] box: [_]
Payer's
Request for
Taxpayer ----------------------------------------------------------
Identification
Number ("TIN") Part 4--Certification--Under penalties of
and perjury, I certify that:
Certification
(1) The number shown on this form is my correct
Taxpayer Identification Number (or I am waiting
for a number to be issued to me), and
(2) I am not subject to backup withholding 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) above if you have been notified by the IRS that
you are subject to backup withholding because of
under-reporting interest or dividends on your tax
return.
----------------------------------------------------------
Signature ________________________ Date __________
Name (Please Print) _________________________________
Address _____________________________________________
City, State and Zip Code ____________________________
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW
THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
NOTE: YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN
PART 3 OF THE 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 Internal Revenue Service 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 cash
payments made to me thereafter will be withheld until I provide a taxpayer
identification number.
Signature: ____________________________________ Date: ______________
10
<PAGE>
The Information Agent for the Offer is:
MORROW & CO., INC.
445 Park Avenue
5th Floor
New York, New York 10022
Call Collect: (212) 754-8000
Toll Free: (800) 566-9061
Bankers and Brokerage Firms, Please Call: (800) 662-5200
Stockholders, Please Call: (800) 566-9061
The Dealer Manager for the Offer is:
Merrill Lynch & Co.
World Financial Center
North Tower
New York, New York 10281-1305
(212) 449-8971 (Call Collect)
11
<PAGE>
Exhibit (a)(3)
LETTER OF TRANSMITTAL
To Tender
Shares of 4 1/2% Series A Cumulative Convertible Preferred Stock
and/or
The Special Common Stock Warrant
of
Wang Laboratories, Inc.
Pursuant to the Offer to Purchase
Dated May 10, 1999
by
Getronics Acquisition, Inc.
a wholly-owned subsidiary of
Getronics NV
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON MONDAY, JUNE 7, 1999, UNLESS THE OFFER IS EXTENDED.
The Depositary for the Offer is:
Citibank, N.A.
<TABLE>
<S> <C> <C>
By Hand: By Mail: By Overnight Courier:
Citibank, N.A. Citibank, N.A. Citibank, N.A.
Corporate Actions Corporate Actions Corporate Actions
111 Wall Street, 5th Floor Window P.O. Box 2544 525 Washington Boulevard, Suite 4660
New York, New York 10043 Jersey City, New Jersey 07303-2544 Jersey City, New Jersey 07303
</TABLE>
For Information:
(877) 248-4237
DESCRIPTION OF SECURITIES TENDERED
- --------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Name(s) and Address(es) of Registered Holder(s)
(Pease fill in, if blank, exactly as name(s) appear(s)l Securities Tendered
on the certificate(s)) (Attach additional list if necessary)
-----------------------------------------------------------------------------------------------
Total Number
of Securities
Security Evidenced by Number
Certificate Security of Securities
Number(s) Certificate(s) Tendered:*
---------------------------------------------------------
---------------------------------------------------------
---------------------------------------------------------
---------------------------------------------------------
---------------------------------------------------------
---------------------------------------------------------
<S> <C> <C> <C>
Total Securities
Tendered.................
</TABLE>
- --------------------------------------------------------------------------------
* Unless otherwise indicated, it will be assumed that all Securities
evidenced by any Security Certificate(s) delivered to the Depositary are
being tendered. See Instruction 4.
<PAGE>
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE WILL NOT CONSTITUTE A VALID DELIVERY TO THE DEPOSITARY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
This Letter of Transmittal is to be completed by the holder ("Holder") of
certificates representing (i) Series A Preferred Stock and (ii) the Special
Common Stock Warrant (as such terms are defined in the Offer to Purchase and,
collectively, the "Securities").
If certificates evidencing Securities (the "Security Certificates") are not
immediately available or cannot be delivered along with all other documents
required hereby to the Depositary on or prior to the Expiration Date (as
defined in Section 1--"Terms of the Offer" of the Offer to Purchase), the
Holder may nevertheless tender its Securities according to the guaranteed
delivery procedure set forth in Section 3--"Procedures for Tendering Offer
Securities" of the Offer to Purchase. See Instruction 2 of this Letter of
Transmittal.
[_]CHECK HERE IF THE SECURITIES ARE BEING TENDERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE
FOLLOWING:
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 ___________________________
[_]CHECK HERE IF TENDER IS BEING MADE OF LOST OR MUTILATED SECURITY
CERTIFICATES. SEE INSTRUCTION 9.
NOTE: SIGNATURES MUST BE PROVIDED BELOW
2
<PAGE>
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
Ladies and Gentlemen:
The undersigned hereby tenders to Getronics Acquisition, Inc. (the
"Purchaser"), a Delaware corporation and a wholly-owned subsidiary of
Getronics NV, a public company with limited liability incorporated under the
laws of The Netherlands with its corporate seat in Amsterdam (Municipality
Amsterdam), The Netherlands ("Parent"), (i) the above-described shares of 4
1/2% Series A Cumulative Convertible Preferred Stock, par value $0.01 per
share ("Series A Preferred Stock") and/or (ii) the above-described warrant to
purchase a certain number of shares of Common Stock upon exercise thereof
("Special Common Stock Warrant" and together with Series A Preferred Stock,
the "Securities") of Wang Laboratories, Inc., a company organized under the
laws of Delaware (the "Company") upon the terms and subject to the conditions
set forth in the Offer to Purchase dated May 10, 1999 (the "Offer to
Purchase"), receipt of which is hereby acknowledged, and in this Letter of
Transmittal (which, as may be amended and supplemented from time to time,
together with the Offer to Purchase, constitutes the "Offer"). The undersigned
understands that the Purchaser reserves the right to assign to an affiliate of
the Parent the right to purchase all or any portion of the Securities tendered
pursuant to the Offer, but the undersigned further understands that any such
assignment will not relieve the Purchaser of its obligations under the Offer
and will in no way prejudice the rights of the Holder to receive payment for
the Securities validly tendered and accepted for payment pursuant to the
Offer.
Upon the terms and subject to the conditions of the Offer, subject to, and
effective upon, acceptance for payment of and payment for the Securities
tendered herewith in accordance with the terms of the Offer (including, if the
Offer is extended or amended, the terms and conditions of 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 of
the Securities that are being tendered hereby and any and all dividends,
distributions, rights, or other securities issued or issuable in respect of
such Securities on or after May 3, 1999 (collectively, "Distributions"), and
appoints the Depositary the true and lawful agent and attorney-in-fact of the
undersigned with respect to such Securities and all Distributions with full
power of substitution (such power of attorney being deemed to be an
irrevocable power coupled with an interest) to (a) transfer ownership of such
Securities and all Distributions, together with all accompanying evidences of
transfers and authenticity, to or upon the order of the Purchaser, (b) present
such Securities and all Distributions for transfer on the books of the Company
and (c) receive all benefits and otherwise exercise all rights of beneficial
ownership of such Securities and all Distributions, all in accordance with the
terms and subject to the conditions of the Offer as set forth in the Offer to
Purchase.
The undersigned hereby irrevocably appoints each designee of the Purchaser
as such attorney-in-fact and proxy of the undersigned, with full power of
substitution, to vote in such manner as each such attorney-in-fact and proxy
(or any substitute thereof) shall deem proper in its sole discretion, and to
otherwise act (including pursuant to written consent) to the full extent of
the undersigned's rights with respect to the Securities and all Distributions
tendered hereby and accepted for payment by the Purchaser prior to the time of
such vote or action. All such proxies shall be considered coupled with an
interest in the tendered Securities and shall be irrevocable and are granted
in consideration of, and is effective upon, the acceptance for payment of such
Securities and all Distributions by the Purchaser in accordance with the terms
of the Offer. Such acceptance for payment shall revoke, without further
action, any other proxy or power of attorney granted by the undersigned at any
time with respect to such Securities and all Distributions and no subsequent
proxies will be given (or, if given, will not be deemed effective) with
respect thereto by the undersigned. The designees of the Purchaser will, with
respect to the Securities, rights or other securities for which the
appointment is effective, be empowered to exercise all voting and other rights
as they in their sole discretion may deem proper at any annual, special,
adjourned or postponed meeting of the Company's stockholders, by written
consent or otherwise, and the Purchaser reserves the right to require that, in
order for the Securities, rights or other securities to be deemed validly
tendered, immediately upon the Purchaser's acceptance for payment of such
Securities, the Purchaser must be able to exercise all rights (including,
without limitation, all voting rights and rights of conversion) with respect
to such Securities, rights or other securities and receive all dividends and
distributions.
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, sell, assign and transfer the Securities and
all Distributions tendered hereby and that, when the same are accepted for
payment by the Purchaser, the Purchaser will acquire good, marketable and
unencumbered title thereto, free and clear of all liens, restrictions, charges
and encumbrances, and the same will not be subject to any adverse claim. The
undersigned will, upon request,
3
<PAGE>
execute and deliver any additional documents deemed by the Depositary or the
Purchaser to be necessary or desirable to complete the sale, assignment, and
transfer of the Securities and all Distributions tendered hereby. In addition,
the undersigned shall promptly remit and transfer to the Depositary for the
account of the Purchaser any and all Distributions in respect of the
Securities tendered hereby, accompanied by appropriate documentation of
transfer and, pending such remittance or appropriate assurance thereof, the
Purchaser shall be entitled to all rights and privileges as owner of any such
Distributions and may withhold the entire purchase price or deduct from the
purchase price the amount or value thereof, 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, personal representatives, successors and assigns of the
undersigned. Subject to the withdrawal rights set forth in Section 4--
"Withdrawal Rights" of the Offer to Purchase, the tender of the Securities
hereby made is irrevocable.
The undersigned understands that tenders of the Securities pursuant to any
of the procedures described in Section 3--"Procedures for Tendering Offer
Securities" of the Offer to Purchase and in the instructions hereto will
constitute the undersigned's acceptance of the terms and conditions of the
Offer. The Purchaser's acceptance for payment of such Securities will
constitute a binding agreement between the undersigned and the Purchaser upon
the terms and subject to the conditions set forth in the Offer to Purchase.
The undersigned recognizes that under certain circumstances set forth in the
Offer to Purchase, the Purchaser may not be required to accept for payment any
of the Securities tendered hereby.
Unless otherwise indicated herein under "Special Payment Instructions,"
please issue the check for the purchase price and/or return any certificates
evidencing Securities ("Security Certificates") not tendered or not accepted
for payment in the name(s) of the registered holder(s) appearing under
"Description of Securities Tendered." Similarly, unless otherwise indicated
under "Special Delivery Instructions," please mail the check for the purchase
price and/or return any Security Certificates not tendered or not accepted for
payment (and accompanying documents, as appropriate) to the address(es) of the
registered holder(s) appearing under "Description of Securities Tendered." In
the event that both the Special Delivery Instructions and the Special Payment
Instructions are completed, please issue the check for the purchase price
and/or issue any Security Certificates not so tendered or accepted for payment
in the name of, and deliver said check and/or return such Security
Certificates to, the person or persons so indicated. The undersigned
recognizes that the Purchaser has no obligation, pursuant to the Special
Payment Instructions, to transfer any Securities from the name of the
registered holder thereof if the Purchaser does not accept for payment any of
the Securities so tendered.
4
<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 To be completed ONLY if
certificate(s) for Securities certificate(s) for Securities
not tendered or not purchased not tendered or not purchased
and/or the check for the and/or the check for the
purchase price of Securities purchase price of Securities
purchased are to be issued in purchased are to be sent to
the name of someone other than someone other than the
the undersigned. undersigned, or to the
undersigned at an address other
than that shown above.
Issue check and/or certificate(s)
to:
Name: ____________________________
Mail check and/or certificate(s)
to:
Please Type or Print
Address: _________________________ Name: ___________________________
Please Type or Print
__________________________________
(Include Zip Code) Address: ________________________
_________________________________* _________________________________
(Tax Identification or Social (Include Zip Code)
Security No.) _________________________________
(See Substitute Form W-9 Included (Tax Identification or Social
Herewith) Security No.)
__________________________________ (See Substitute Form W-9
* Signature Guarantee required Included Herewith)
5
<PAGE>
IMPORTANT
HOLDER(S) SIGN HERE
(See Instructions 1 and 5)
(Please Complete Substitute Form W-9 Contained Herein)
Signature(s) of Holder(s): _____________________________________________________
Date: _________________________ , 1999
- --------------------------------------
(Tax Identification or Social
Security No.)
(Must be signed by registered holder(s) exactly as name(s) appear(s) on
Security Certificate(s) or on a security position listing or by person(s)
authorized to become registered holder(s) by certificate(s) and documents
transmitted with this Letter of Transmittal. If signature is by trustees,
executors, administrators, guardians, attorneys-in-fact, officers of
corporations or other person acting in a fiduciary or representative capacity,
please provide the following information and see Instruction 5.)
Name(s): _______________________________________________________________________
(Please Print)
Capacity (Full Title): _________________________________________________________
Address: _______________________________________________________________________
- --------------------------------------------------------------------------------
(Include Zip Code)
- --------------------------------------------------------------------------------
(Area Code and Telephone No.)
GUARANTEE OF SIGNATURE(s)
(See Instructions 1 and 5)
Authorized Signature: __________________________________________________________
Name: __________________________________________________________________________
(Please Type or Print)
Title: _________________________________________________________________________
Name of Firm: __________________________________________________________________
Address: _______________________________________________________________________
- --------------------------------------------------------------------------------
(Include Zip Code)
Name of Firm: __________________________________________________________________
Area Code and Telephone Number: ________________________________________________
Date: _________________________ , 1999
6
<PAGE>
INSTRUCTIONS
Forming Part of the Terms and Conditions of the Offer
1. Guarantee of Signatures. Except as otherwise provided below, all
signatures on this Letter of Transmittal must be guaranteed by a financial
institution (including most banks, savings and loan associations and brokerage
houses) which is a participant in the Security Transfer Agents Medallion
Program, The New York Stock Exchange Medallion Signature Guarantee Program or
the Stock Exchange Medallion Program (an "Eligible Institution"). Signatures
on this Letter of Transmittal need not be guaranteed (a) if this Letter of
Transmittal is signed by the registered Holder(s) of the Securities tendered
herewith and such Holder(s) have not completed the box entitled "Special
Payment Instructions" on this Letter of Transmittal or (b) if such Securities
are tendered for the account of an Eligible Institution. See Instruction 5 of
this Letter of Transmittal.
2. Delivery of Letter of Transmittal and Security Certificates. This Letter
of Transmittal is to be used if Security Certificates are to be forwarded
herewith. Security Certificates evidencing all physically tendered Securities
along with this Letter of Transmittal (or a copy thereof), properly completed
and duly executed with any required signature guarantees, and any other
documents required by this Letter of Transmittal, must be received by the
Depositary at one of its addresses set forth herein on or prior to the
Expiration Date (as defined in Section 1--"Terms of the Offer" of the Offer to
Purchase).
If the Security Certificates are not immediately available or cannot be
delivered along with all other required documents to the Depositary on or
prior to the Expiration Date, Microsoft may nevertheless tender its Securities
by properly completing and duly executing a Notice of Guaranteed Delivery
pursuant to the guaranteed delivery procedure set forth in Section 3--
"Procedures for Tendering Offer Securities" of the Offer to Purchase. Pursuant
to such procedure: (i) such tender must be made by or through an Eligible
Institution; (ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form provided by the Purchaser, must be
received by the Depositary on or prior to the Expiration Date; and (iii)
Security Certificates as well as a Letter of Transmittal, properly completed
and duly executed with any required signature guarantees, and all other
documents required by this Letter of Transmittal must be received by the
Depositary within three New York Stock Exchange trading days after the date of
execution of such Notice of Guaranteed Delivery.
If Security Certificates are forwarded to the Depositary in multiple
deliveries, a properly completed and duly executed Letter of Transmittal (or a
copy thereof) must accompany each such delivery.
The method of delivery of this Letter of Transmittal, Security Certificates
and all other required documents is at the election and risk of the tendering
Holder. Delivery will be deemed made only when actually received by the
Depositary. If such delivery is by mail, registered mail with return receipt
requested, properly insured, is recommended. In all cases, sufficient time
should be allowed to assure timely delivery.
No alternative, conditional or contingent tenders will be accepted and no
fractional Securities will be purchased. Microsoft, by execution of this
Letter of Transmittal (or a copy hereof), waives any right to receive any
notice of the acceptance of its Securities for payment.
3. Inadequate Space. If the space provided under "Description of Securities
Tendered" is inadequate, the Security Certificate numbers and/or the number of
Securities should be listed on a separate schedule and attached hereto.
4. Partial Tenders. If fewer than all the Securities evidenced by any
Security Certificate submitted are to be tendered, fill in the number of
Securities which are to be tendered in the box entitled "Number of Securities
Tendered." In such cases, new Security Certificate(s) evidencing the remainder
of the Securities that were evidenced by Security Certificate(s) delivered to
the Depositary will be sent to the person 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 Securities represented by Security 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
Securities tendered hereby, the signatures must correspond with the names as
written on the face of the Security Certificates without alteration,
enlargement or any change whatsoever.
7
<PAGE>
If this Letter of Transmittal or any Security Certificate or stock power is
signed by a trustee, executor, administrator, 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 evidence satisfactory to the
Depositary and the Purchaser of such person's authority so to act must be
submitted.
If this Letter of Transmittal is signed by the registered holder(s) of the
Securities transmitted hereby, no endorsements of Security Certificates or
separate stock powers are required unless payment is to be made to, or
Security Certificate(s) evidencing the Securities not tendered or purchased
are to be issued in the name of, a person other than the registered holder(s).
Signatures on such Security Certificates or stock powers must be guaranteed by
an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered holder of the Securities tendered hereby, the Security
Certificate(s) must be endorsed or accompanied by appropriate stock powers, in
either case signed exactly as the name or names of the registered holder or
holders appear(s) on such Security Certificate(s). Signatures on such Security
Certificates or stock powers must be guaranteed by an Eligible Institution.
6. Transfer Taxes. Except as otherwise provided in this Instruction 6, the
Purchaser will pay or cause to be paid any transfer taxes with respect to the
transfer and sale of purchased Securities to it or its order pursuant to the
Offer. If, however, payment of the purchase price of any Securities purchased
is to be made to or, in the circumstances permitted hereby, if Security
Certificates for the Securities not tendered or purchased are to be registered
in the name of any person other than the registered holder, or if tendered
Security Certificates are registered in the name of any person other than the
person(s) signing this Letter of Transmittal, the amount of any transfer taxes
(whether imposed on the registered holder or such person) payable on account
of the transfer to such person will be deducted from the purchase price if
satisfactory evidence of the payment of such taxes, or exemption therefrom, is
not submitted.
Except as provided in this Instruction 6, it will not be necessary for
transfer tax stamps to be affixed to the Security Certificates listed in this
Letter of Transmittal.
7. Special Payment and Delivery Instructions. If a check for the purchase
price is to be issued in the name of, and/or Security Certificates for the
Securities not tendered or not accepted for payment are to be issued in the
name of a person other than the signer of this Letter of Transmittal or if a
check and/or such Security Certificates are to be mailed to someone other than
the signer of this Letter of Transmittal or to an address other than that
shown above, the appropriate boxes on this Letter of Transmittal should be
completed.
8. Requests for Assistance or Additional Copies. Questions or requests for
assistance may be directed to, or additional copies of the Offer to Purchase,
this Letter of Transmittal, the Notice of Guaranteed Delivery and other tender
offer materials may be obtained from, the Information Agent or the Dealer
Manager at their respective addresses set forth on the back cover of the Offer
to Purchase or from your broker, dealer, commercial bank or trust company.
9. Lost or Destroyed Security Certificates. If any Security Certificates
have been lost or destroyed, the Holder should promptly notify the Company's
transfer agent, American Stock Transfer and Trust Company at (212) 936-5100.
The Holder will then be instructed as to the procedure to be followed in order
to replace the relevant Security Certificates. This Letter of Transmittal and
related documents cannot be processed until the procedures for replacing lost
or destroyed Security Certificates have been followed.
8
<PAGE>
IMPORTANT TAX INFORMATION
Under United States federal income tax law, a tendering Holder may be
subject to backup withholding tax at a rate of 31% with respect to payments by
the Depositary pursuant to the Offer unless such Holder (i) is a corporation
or other exempt recipient and, if required, establishes its exemption from
backup withholding, (ii) provides its correct taxpayer identification number
("TIN"), certifies that it is not currently subject to backup withholding and
otherwise complies with applicable requirements of the backup withholding
rules, or (iii) certifies as to its non-United States status. Completion of a
Substitute Form W-9, in the case of a U.S. Holder, provided in this Letter of
Transmittal should be used for this purpose. Failure to provide such Holder's
TIN on the Substitute Form W-9, if applicable, may subject the tendering
Holder (or other payee) to a $50 penalty imposed by the Internal Revenue
Service ("IRS"). More serious penalties may be imposed for providing false
information which, if willfully done, may result in fines and/or imprisonment.
The box in part 3 of the Substitute Form W-9 may be checked if the tendering
Holder (or other payee) is required to submit a Substitute Form W-9 and has
not been issued a TIN and has applied for a TIN or intends to apply for a TIN
in the near future. If the box in Part 3 is so checked and the Depositary is
not provided with a TIN by the time of payment, the Depositary will withhold
31% on all such payments of the Offer Price until a TIN is provided to the
Depositary. In order for a foreign Holder to qualify as an exempt recipient,
that Holder should submit an IRS Form W-8 or a Substitute Form W-8, signed
under penalties of perjury, attesting to that Holder's exempt status. Such
forms can be obtained from the Depositary. Failure to provide the information
on the form may subject tendering Holders to 31% United States federal income
tax withholding on the payment of the purchase price of cash pursuant to the
Offer.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A COPY HEREOF) TOGETHER WITH
SECURITY CERTIFICATES AND ALL OTHER REQUIRED DOCUMENTS OR THE
NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY
ON OR PRIOR TO THE EXPIRATION DATE.
9
<PAGE>
TO BE COMPLETED BY ALL TENDERING HOLDERS
PAYER'S NAME: Citibank, N.A.
- --------------------------------------------------------------------------------
Part 1--PLEASE PROVIDE YOUR
TIN IN THE BOX AT RIGHT AND ----------------------
CERTIFY BY SIGNING AND Social Security Number
DATING BELOW
SUBSTITUTE OR
Form W-9
Department of ----------------------
the Treasury Employer Identification
Internal Number
Revenue ----------------------------------------------------------
Service Part 2--If you are Part 3--If you are
exempt from backup awaiting your TIN,
withholding, please please check the
check the box: [_] box: [_]
Payer's
Request for
Taxpayer ----------------------------------------------------------
Identification
Number ("TIN") Part 4--Certification--Under penalties of
and perjury, I certify that:
Certification
(1) The number shown on this form is my correct
Taxpayer Identification Number (or I am waiting
for a number to be issued to me), and
(2) I am not subject to backup withholding 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) above if you have been notified by the IRS that
you are subject to backup withholding because of
under-reporting interest or dividends on your tax
return.
----------------------------------------------------------
Signature ________________________ Date __________
Name (Please Print) _________________________________
Address _____________________________________________
City, State and Zip Code ____________________________
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW
THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
NOTE: YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN
PART 3 OF THE 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 Internal Revenue Service 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 cash
payments made to me thereafter will be withheld until I provide a taxpayer
identification number.
Signature: ____________________________________ Date: ______________
10
<PAGE>
The Information Agent for the Offer is:
MORROW & CO., INC.
445 Park Avenue
5th Floor
New York, New York 10022
Call Collect: (212) 754-8000
Toll Free: (800) 566-9061
Bankers and Brokerage Firms, Please Call: (800) 662-5200
Stockholders, Please Call: (800) 566-9061
The Dealer Manager for the Offer is:
Merrill Lynch & Co.
World Financial Center
North Tower
New York, New York 10281-1305
(212) 449-8971 (Call Collect)
11
<PAGE>
Exhibit (a)(4)
World Financial Center
North Tower
New York, New York
Merrill Lynch Logo 10281-1305
(212) 449-8971 (Call
Collect)
OFFER TO PURCHASE FOR CASH
All of the Outstanding Shares of Common Stock (Including the Associated
Rights),
All of the Outstanding Shares of 6 1/2% Series B Cumulative
Convertible Preferred Stock,
All of the Outstanding Depositary Shares (each representing a 1/20th interest
in a Share of 6 1/2% Series B Cumulative Convertible Preferred Stock)
and
All of the Outstanding Common Stock Purchase Warrants
of
Wang Laboratories, Inc.
at
$29.25 Net Per Share of Common Stock,
$1,101.17 Net Per Share of 6 1/2% Series B Cumulative Convertible Preferred
Stock,
$55.05 Net Per Depositary Share
and
$7.80 Net Per Common Stock Purchase Warrant
by
Getronics Acquisition, Inc.
A Wholly-Owned Subsidiary of
Getronics NV
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON MONDAY, JUNE 7, 1999 UNLESS THE OFFER IS EXTENDED.
May 10, 1999
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
We have been appointed by Getronics Acquisition, Inc., a Delaware
corporation (the "Purchaser") and a wholly-owned subsidiary of Getronics NV, a
public company with limited liability incorporated under the laws of The
Netherlands with its corporate seat in Amsterdam, The Netherlands ("Parent"),
to act as Dealer Manager in connection with the Purchaser's offer to purchase,
inter alia, (i) all of the issued and outstanding shares of common stock, par
value $0.01 per share, including the associated rights (the "Common Stock"),
of Wang Laboratories, Inc., a company organized under the laws of Delaware
(the "Company"), at a price of $29.25 per share of Common Stock, net to the
seller in cash, without interest thereon (the "Common Stock Offer Price"),
(ii) all of the issued and outstanding shares of 6 1/2% Series B Cumulative
Convertible Preferred Stock, par value $0.01 per share (the "Series B
Preferred Stock"), at a price of $1,101.17 per share of Series B Preferred
Stock net to the seller in cash, without interest thereon (the "Series B
Preferred Stock Offer Price"), (iii) all of the issued and outstanding
depositary shares, each representing a 1/20th interest in a share of Series B
Preferred Stock, (the "Depositary Shares"), at a price of $55.05 per
Depositary Share, net to the seller in cash, without interest thereon (the
"Depositary Shares Offer Price") and/or (iv) all of the issued and outstanding
warrants, other than the Special Common Stock Warrant (as defined in the Offer
to Purchase), to purchase shares of Common Stock (the "Common Stock Purchase
Warrants"), at a price of $7.80 per Common Stock Purchase Warrant, net to the
seller in cash, without interest thereon (the "Common Stock Purchase Warrant
Offer Price" and, together with the Common Stock Offer Price, the Series B
Preferred Stock Offer Price and the
<PAGE>
Depositary Shares Offer Price, collectively, the "Offer Price"), upon the
terms and subject to the conditions set forth in the Offer to Purchase and in
the related Letter of Transmittal (which, as they may be amended and
supplemented from time to time, together constitute the "Offer"), copies of
which are enclosed herewith. Unless the context indicates otherwise, as used
herein, "Offer Securities" shall mean inter alia shares of Common Stock,
Series B Preferred Stock, Depositary Shares and Common Stock Purchase
Warrants. Please furnish copies of the enclosed materials to those of your
clients for whose accounts you hold Offer Securities in your name or in the
name of your nominee.
Enclosed herewith for your information and forwarding to your clients are
copies of the following documents:
1. The Offer to Purchase dated May 10, 1999.
2. The Letter of Transmittal to tender Offer Securities for your use and
for the information of your clients. Copies of the Letter of Transmittal
may be used to tender Offer Securities.
3. A letter to stockholders of the Company from Joseph M. Tucci, Chairman
and Chief Executive Officer of the Company, together with a
Solicitation/Recommendation Statement on Schedule 14D-9 filed with the
Securities and Exchange Commission by the Company and mailed to
stockholders of the Company.
4. The Notice of Guaranteed Delivery for Offer Securities to be used to
accept the Offer if the procedures for tendering Offer Securities set forth
in the Offer to Purchase cannot be completed on a timely basis.
5. A printed form of letter which may be sent to your clients for whose
accounts you hold Offer Securities registered in your name or in the name
of your nominee, with space provided for obtaining such clients'
instructions with regard to the Offer.
WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. THE OFFER AND
WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON
MONDAY, JUNE 7, 1999 UNLESS THE OFFER IS EXTENDED.
Please note the following:
1. The Offer Price is (i) $29.25 per share of Common Stock, (ii)
$1,101.17 per share of Series B Preferred Stock, (iii) $55.05 per
Depositary Share and (iv) $7.80 per Common Stock Purchase Warrant, in each
case, net to the seller in cash, without interest thereon, as set forth in
the Introduction to the Offer to Purchase.
2. The Offer is conditioned on there being validly tendered and not
properly withdrawn prior to the Expiration Date (as defined in the Offer to
Purchase) a number of Offer Securities which represent at least a majority
of the Common Stock Equivalents (as such term is defined in the Offer to
Purchase) on the date of purchase and certain other conditions. See the
Introduction and Section 1--"Terms of the Offer" and Section 14--
"Conditions of the Offer" of the Offer to Purchase.
3. The Offer is being made for all of the issued and outstanding Offer
Securities.
4. Tendering holders whose Offer Securities are registered in their own
name and who tender directly to Citibank, N.A., as Depositary (the
"Depositary") will not be obligated to pay brokerage fees or commissions
or, except as otherwise provided in Instruction 6 of the Letter of
Transmittal, transfer taxes on the purchase of Offer Securities by the
Purchaser pursuant to the Offer. However, federal income tax backup
withholding at a rate of 31% may be required, unless an exemption is
available or unless the required tax identification information is
provided. See the "Important Tax Information" section contained in the
Letter of Transmittal.
5. The Board of Directors of the Company (i) has determined that each of
the Offer and the merger of the Purchaser with and into the Company (the
"Merger") is fair to, and in the best interests of, the holders of the
Offer Securities and has declared that the Offer and the Merger are
advisable, (ii) has approved the
2
<PAGE>
Offer and the Merger and (iii) has recommended that the holders of the
Offer Securities accept the Offer and tender their Offer Securities
pursuant to the Offer and that the holders of Common Stock, Series A
Preferred Stock, Series B Preferred Stock and Depositary Shares approve and
adopt the Merger Agreement, as described in the Offer to Purchase.
6. Notwithstanding any other provision of the Offer, payment for Offer
Securities accepted for payment pursuant to the Offer will in all cases be
made only after timely receipt by the Depositary of (i) certificates
evidencing such Offer Securities (the "Offer Security Certificates"), along
with a properly completed and duly executed Letter of Transmittal (or a
copy thereof), including any required signature guarantees, or (ii) if such
Offer Securities are held in book-entry form, timely confirmation of a
book-entry transfer (a "Book-Entry Confirmation") of such Offer Securities
into the Depositary's account at The Depository Trust Company along with an
Agent's Message (as defined in the Offer to Purchase), pursuant to the
procedures set forth in Section 3--"Procedures for Tendering Offer
Securities" of the Offer to Purchase and (iii) any other documents required
by the Letter of Transmittal. Accordingly, payment may not be made to all
tendering holders at the same time depending upon when Offer Security
Certificates are actually received by the Depositary.
In order to take advantage of the Offer (i) a duly executed and properly
completed Letter of Transmittal (and any required signature guarantee or other
required documents) or an Agent's Message in the case of Offer Securities held
in book-entry form should be sent to the Depositary and (ii) Offer Security
Certificates representing the tendered Offer Securities or a timely Book-Entry
Confirmation should be delivered to the Depositary in accordance with the
instructions set forth in the Letter of Transmittal and the Offer to Purchase.
If holders of Offer Securities wish to tender, but it is impracticable for
them to forward their Offer Security Certificates or other required documents
or complete the procedures for book-entry transfer prior to the Expiration
Date, a tender may be effected by following the guaranteed delivery procedures
specified in Section 3--"Procedures for Tendering Offer Securities" of the
Offer to Purchase.
The Purchaser will not pay any fees or commissions to any broker, dealer or
other person for soliciting tenders of Offer Securities pursuant to the Offer
(other than the Dealer Manager, the Depositary and the Information Agent as
described in the Offer to Purchase). The Purchaser will, however, 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 transfer taxes payable on the transfer of
Offer Securities 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
Merrill Lynch, Pierce, Fenner & Smith Incorporated, the Dealer Manager for the
Offer, at World Financial Center, North Tower, New York, New York 10281-1305,
telephone number (212) 449-8971, or to Morrow & Co., Inc., the Information
Agent for the Offer, at 445 Park Avenue, 5th Floor, New York, New York 10022,
telephone number (212) 754-8000.
Requests for copies of the enclosed materials may also be directed to the
Dealer Manager or to the Information Agent at the above addresses and
telephone numbers.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER &
SMITH
INCORPORATED
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY OTHER PERSON THE AGENT OF THE PURCHASER, PARENT, THE COMPANY, THE
DEALER MANAGER, THE DEPOSITARY, THE INFORMATION AGENT OR ANY AFFILIATE OF ANY
OF THEM, OR AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENT OR USE ANY
DOCUMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE
ENCLOSED DOCUMENTS AND THE STATEMENTS CONTAINED THEREIN.
3
<PAGE>
Exhibit (a)(5)
OFFER TO PURCHASE FOR CASH
All of the Outstanding Shares of Common Stock (Including the Associated
Rights),
All of the Outstanding Shares of 6 1/2% Series B Cumulative
Convertible Preferred Stock,
All of the Outstanding Depositary Shares (each representing a 1/20th interest
in a Share of 6 1/2% Series B Cumulative Convertible Preferred Stock),
and
All of the Outstanding Common Stock Purchase Warrants
of
Wang Laboratories, Inc.
at
$29.25 Net Per Share of Common Stock,
$1,101.17 Net Per Share of 6 1/2% Series B Cumulative Convertible Preferred
Stock,
$55.05 Net Per Depositary Share,
and
$7.80 Net Per Common Stock Purchase Warrant
by
Getronics Acquisition, Inc.
A Wholly-Owned Subsidiary of
Getronics NV
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON MONDAY, JUNE 7, 1999 UNLESS THE OFFER IS EXTENDED.
May 10, 1999
To Our Clients:
Enclosed for your consideration are the Offer to Purchase, dated May 10,
1999 (the "Offer to Purchase"), and the related Letter of Transmittal (which,
as they may be amended and supplemented from time to time, together constitute
the "Offer") relating to the offer by Getronics Acquisition, Inc., a Delaware
corporation (the "Purchaser") and a wholly-owned subsidiary of Getronics NV, a
public company with limited liability incorporated under the laws of The
Netherlands with its corporate seat in Amsterdam, The Netherlands, to
purchase, inter alia (i) all of the issued and outstanding shares of common
stock, par value $0.01 per share, including the associated rights (the "Common
Stock"), of Wang Laboratories, Inc., a company organized under the laws of
Delaware (the "Company"), at a price of $29.25 per share of Common Stock, net
to the seller in cash, without interest thereon (the "Common Stock Offer
Price"), (ii) all of the issued and outstanding shares of 6 1/2% Series B
Cumulative Convertible Preferred Stock, par value $0.01 per share (the "Series
B Preferred Stock"), at a price of $1,101.17 per share of Series B Preferred
Stock net to the seller in cash, without interest thereon (the "Series B
Preferred Stock Offer Price"), (iii) all of the issued and outstanding
depositary shares, each representing a 1/20th interest in a share of Series B
Preferred Stock (the "Depositary Shares"), at a price of $55.05 per Depositary
Share, net to the seller in cash, without interest thereon (the "Depositary
Shares Offer Price") and/or (iv) all of the issued and outstanding warrants,
other than the Special Common Stock Warrant (as defined in the Offer to
Purchase) to purchase shares of Common Stock (the "Common Stock Purchase
Warrants"), at a price of $7.80 per Common Stock Purchase Warrant, net to the
seller in cash, without interest thereon (the "Common Stock Purchase Warrant
Offer Price" and, together with the Common Stock Offer Price, the Series B
Preferred Stock Offer Price and the Depositary Shares Offer Price,
collectively, the "Offer Price"), upon the terms and subject to the conditions
set forth in the Offer to Purchase and in the related Letter of Transmittal.
Unless the context indicates otherwise, as used herein, "Offer Securities"
shall mean shares of Common Stock, shares of Series B Preferred Stock,
Depositary Shares and Common Stock Purchase Warrants.
<PAGE>
We are (or our nominee is) the holder of record of Offer Securities held for
your account. A tender of such Offer Securities 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 Offer Securities held by us for your account.
Accordingly, we request instruction as to whether you wish to have us tender
on your behalf any or all Offer Securities held by us for your account
pursuant to the terms and conditions set forth in the Offer.
Please note the following:
1. The Offer Price is (i) $29.25 per share of Common Stock, (ii)
$1,101.17 per share of Series B Preferred Stock, (iii) $55.05 per
Depositary Share and (iv) $7.80 per Common Stock Purchase Warrant, in each
case, net to the seller in cash, without interest thereon, as set forth in
the Introduction to the Offer to Purchase.
2. The Offer is conditioned on there being validly tendered and not
properly withdrawn prior to the Expiration Date (as defined in the Offer to
Purchase) a number of Offer Securities which represent at least a majority
of the Common Stock Equivalents (as such term is defined in the Offer to
Purchase) on the date of purchase and certain other conditions. See the
Introduction and Section 1--"Terms of the Offer" and Section 14--
"Conditions of the Offer" of the Offer to Purchase.
3. The Offer is being made for all of the issued and outstanding Offer
Securities.
4. Tendering holders whose Offer Securities are registered in their own
name and who tender directly to Citibank, N.A., as Depositary (the
"Depositary") will not be obligated to pay brokerage fees or commissions
or, except as otherwise provided in Instruction 6 of the Letter of
Transmittal, transfer taxes on the purchase of Offer Securities by the
Purchaser pursuant to the Offer. However, federal income tax backup
withholding at a rate of 31% may be required, unless an exemption is
available or unless the required tax identification information is
provided. See the "Important Tax Information" section contained in the
Letter of Transmittal.
5. The Offer and withdrawal rights will expire at 12:00 midnight, New
York City time, on Monday, June 7, 1999 unless the Offer is extended.
6. The Board of Directors of the Company (i) has determined that each of
the Offer and the merger of the Purchaser with and into the Company (the
"Merger"), is fair to, and in the best interests of, the holders of the
Offer Securities and has declared that the Offer and the Merger are
advisable, (ii) has approved the Offer and the Merger and (iii) has
recommended that the holders of the Offer Securities accept the Offer and
tender their Offer Securities pursuant to the Offer and that the holders of
Common Stock, Series A Preferred Stock, Series B Preferred Stock and/or
Depositary Shares approve and adopt the Merger Agreement (as such term is
defined in the Offer to Purchase).
7. Notwithstanding any other provision of the Offer, payment for Offer
Securities accepted for payment pursuant to the Offer will in all cases be
made only after timely receipt by the Depositary of (i) certificates
evidencing such Offer Securities (the "Offer Security Certificates"), along
with a properly completed and duly executed Letter of Transmittal (or a
copy thereof), including any required signature guarantees, or (ii) if such
Offer Securities are held in book-entry form, timely confirmation of a
book-entry transfer of such Offer Securities into the Depositary's account
at The Depository Trust Company, along with an Agent's Message (as defined
in the Offer to Purchase) pursuant to the procedures set forth in Section
3--"Procedures for Tendering Offer Securities" of the Offer to Purchase,
and (iii) any other documents required by the Letter of Transmittal.
Accordingly, payment may not be made to all tendering holders at the same
time depending upon when Offer Security Certificates are actually received
by the Depositary.
2
<PAGE>
If you wish to have us tender any or all of the Offer Securities held by us
for your account please so instruct us by completing, executing, detaching and
returning to us the instruction form set forth herein. If you authorize the
tender of your Offer Securities, all such Offer Securities will be tendered
unless otherwise specified below. An envelope to return your instructions to
us is enclosed. Your instructions should be forwarded to us in ample time to
permit us to submit a tender on your behalf prior to the Expiration Date.
The Purchaser is not aware of any state in the United States where the
making of the Offer is prohibited by administrative or judicial action
pursuant to any valid state statue. If the Purchaser becomes aware of any
valid state statute prohibiting the making of the Offer or the acceptance of
Offer Securities pursuant thereto, the Purchaser will make a good faith effort
to comply with such state statute or seek to have such statute declared
inapplicable to the Offer. If, after such good faith effort, the Purchaser
cannot comply with such state statute, the Offer will not be made to (nor will
tenders be accepted from or on behalf of) the holders of Offer Securities in
such state. 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 Merrill Lynch, Pierce,
Fenner & Smith Incorporated or one or more registered brokers or dealers
licensed under the laws of such jurisdiction.
3
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE
OFFER TO PURCHASE FOR CASH
All of the Outstanding Shares of Common Stock
(Including the Associated Rights),
All of the Outstanding Shares of 6 1/2% Series B Cumulative
Convertible Preferred Stock,
All of the Outstanding Depositary Shares (each representing a 1/20th interest
in a Share of 6 1/2% Series B Cumulative Convertible Preferred Stock),
and
All of the Outstanding Common Stock Purchase Warrants
of
Wang Laboratories, Inc.
The undersigned acknowledge(s) receipt of your letter, the Offer to
Purchase, dated May 10, 1999, and the related Letter of Transmittal (which, as
they may be amended and supplemented from time to time, together constitute
the "Offer") in connection with the offer by Getronics Acquisition, Inc., a
Delaware corporation (the "Purchaser") and a wholly-owned subsidiary of
Getronics NV, a public company with limited liability incorporated under the
laws of The Netherlands with its corporate seat in Amsterdam, The Netherlands,
inter alia, to purchase (i) all of the issued and outstanding shares of common
stock, par value $0.01 per share, including the associated rights (the "Common
Stock"), at a price of $29.25 per shares of Common Stock, net to the seller in
cash, without interest thereon, (ii) all of the issued and outstanding shares
of 6 1/2% Series B Preferred Cumulative Convertible Stock, par value $0.01 per
share (the "Series B Preferred Stock"), at a price of $1,101.17 per share of
Series B Preferred Stock net to the seller in cash, without interest thereon,
(iii) all of the issued and outstanding depositary shares, each representing a
1/20th interest in a share of Series B Preferred Stock, par value $0.01 per
share (the "Depositary Shares"), at a price of $55.05 per Depositary Share,
net to the seller in cash, without interest thereon and (iv) all of the issued
and outstanding warrants to purchase shares of Common Stock at $21.45 per
share of Common Stock (the "Common Stock Purchase Warrants"), at a price of
$7.80 per Common Stock Warrant, net to the seller in cash, without interest
thereon. Unless the context indicates otherwise, "Offer Securities" shall mean
the Common Stock, the Series B Preferred Stock, the Depositary Shares and the
Common Stock Purchase Warrants.
The undersigned hereby instructs you to tender to the Purchaser the number
of Offer Securities indicated below (or if no number is indicated below, all
Offer Securities) which are held by you for the account of the undersigned,
upon the terms and subject to the conditions set forth in the Offer.
4
<PAGE>
Number of Offer Securities to be Tendered*:
(a) Common Stock
----------------------------------------------------
(b) Series B Preferred Stock
----------------------------------------------
(c) Depositary Shares
---------------------------------------------------
(d) Common Stock Purchase Warrants
--------------------------------------
Date:
-----------------------------------------------------------------------
SIGN HERE
Signature(s):
------------------------------------------------------------------
Print Name(s):
----------------------------------------------------------------
Print Address(es):
--------------------------------------------------------------
Area Code and Telephone Number(s):
-----------------------------------------------
Taxpayer Identification or Social Security Number(s):
------------------------------------
- --------
* Unless otherwise indicated, it will be assumed that all of your Offer
Securities held by us for your account are to be tendered.
5
<PAGE>
EXHIBIT (a)(6)
Press Release wang (04.05.99) Page 1 of 5
Press
release Getronics announces recommended public bid for Wang Global
Getronics will become a global network services and business
Amsterdam, solution company
May 4, 1999 Getronics will achieve wide geographical coverage in Europe, a
strong base in North America and substantial footholds in Asia and
South America
Pro-forma net sales 1998 of Dfls 9.6 billion, active in over 40
countries with 33,000 employees
Financing of the acquisition through a mix of borrowings and issue
of new shares
Accelerated growth in earnings per share, before amortisation of
goodwill, through the acquisition
Sound basis for further acceleration of growth, particularly in
Business Solutions & Consulting
Getronics has signed an agreement with Wang Global to purchase all
the shares of Wang Global. The acquisition will be realised by way
of a public tender offer for all common shares, warrants, options
and other equity instruments outstanding. The offer price for the
common shares is set at US$ 29.25. The total transaction value
amounts to Dfls 3.7 billion. The transaction has been approved and
is recommended by Wang Global's Board.
Profile of Wang Global
Wang Global is a leading international network technology services
and solutions company providing a comprehensive range of ICT
services for today's networked business environments. In calendar
year 1998, Wang Global realised net sales of Dfls 6.1 billion of
which 53% in Europe, 36% in North and South America and 11% in
Asia-Pacific.
Wang Global designs, installs, operates and maintains desktop and
network infrastructures for some of the world's largest
multinational companies. Its services include systems architecture
design, installation, warranty, help desk, maintenance, software
support, and management of enterprise networks to the desktop as
well as e-commerce solutions.
Wang Global's integration services provide business solutions
primarily for the financial services industry as well as the
public sector.
NASDAQ listed Wang Global employs 20,000 professionals and has
subsidiaries and affiliates in 22 countries in Europe and over 40
countries worldwide.
In the last couple of years, Wang Global's sales mix has shifted
from a focus on proprietary products towards building a
substantial presence in the growing market for network and desktop
services. In 1998, 65% of net sales was realised by Network
Technology Services & Solutions. Remaining sales were realised by
<PAGE>
Press Release wang (04.05.99) Page 2 of 5
Traditional Products and Services (25%) and Standard Products
(10%).
Wang Global has established partnership programmes with some of
the world's leading technology companies. It is global systems
integrator for Cisco Systems, one of the two global service
providers for Dell, and a global enterprise partner for Microsoft.
Key figures for Wang Global are:
Dfls million Calendar year 1998
----------------------------------------------------------
Net sales 6,108
----------------------------------------------------------
Earnings before interest, taxes, 444
depreciation and amortization
----------------------------------------------------------
Employees at year-end 20,300
----------------------------------------------------------
----------------------------------------------------------
Accelerated international growth for Getronics through Wang Global
acquisition
Through this acquisition Getronics is anticipating a growing trend
in the ICT services industry where international clients require a
wide geographical coverage and a full service range from their ICT
suppliers. This trend is explicitly expected in the area of
desktop and network (integration) services, which market is
currently still very fragmented with a large number of suppliers
active mainly on a local basis. Through the acquisition of Wang
Global, Getronics will obtain a strong competitive edge, be able
to internationally leverage on the existing multinational client
base and in the coming years obtain new multinational clients
based upon its capacity to provide a standardised service offering
on a global basis. Business contacts have shown that there is good
strategic fit between the two companies.
Upon completion of the transaction, Getronics will be a leading
global ICT company in network services and business solutions with
a presence in over 40 countries. Combined 1998 annualised sales
will total Dfls 9.6 billion, of which 70% will be realised within
Europe, and the combined workforce will total 33,000 employees.
Furthermore the Wang Global acquisition will offer a platform for
growing the Business Solutions & Consulting activities along the
lines of the growth path Getronics has followed in recent years.
Accelerated growth in earnings per share of Getronics
Through the acquisition of Wang Global, Getronics expects to
enhance earnings per share growth. These expectations are, inter
alia, based on the financing structure envisaged for this
transaction and are excluding the amortisation of goodwill.
Getronics will capitalize the goodwill related to this transaction
and amortise on a straight-line basis over a period of 20 to 30
years.
<PAGE>
Press Release wang (04.05.99) Page 3 of 5
Organisation
Upon completion of the public tender offer, the Board of
Management of Getronics will consist of five members. Cees van
Luijk will continue as President & CEO. Joseph Tucci, currently
Chairman and CEO of Wang Global, will be Deputy CEO. Peter van
Voorst will continue as member of the Board of Management and Jan
Docter will continue as Chief Financial Officer. Mias van Vuuren,
currently member of the Management Committee at Wang Global, will
join the Board of Management.
Corporate Headquarters will be located in Amsterdam. Given the
high degree of complementarity in the geographical spread of both
Getronics and Wang Global no major changes are foreseen in the
organisation of the operational entities.
Wang Global background
Until 1993 Wang Global was active as proprietary IT product and
service company focused on office automation and mini-computers.
After financial difficulties the company emerged out of Chapter 11
in 1993 with new senior management led by its current Chairman &
CEO, Mr. Joseph Tucci and a new strategic focus to build the
company's multi vendor services business. In the period 1993 1997
the company has been successful in building and expanding its
service activities with a focus on desktop and network services.
In March 1998, Wang Global substantially expanded its geographical
reach and the size of its services activities by the acquisition
of Olsy, the systems and services division of Olivetti S.p.A. Wang
Global is currently in the final stages of integrating the Olsy
acquisition. In parallel with the integration and rightsizing of
the company following the Olsy acquisition, operations have been
integrated and several standardised global business concepts have
been successfully launched. These business concepts focus on
management of networks and desktop environments.
In calendar year 1998, Wang Global realised net sales of Dfls 6.1
billion and earnings before interest, taxes, depreciation,
amortization and adjusted for non-recurring charges, of Dfls 444
million. Its balance sheet total and group equity, at year end
1998, amounted to Dfls 4.7 billion and Dfls 0.9 billion
respectively.
As expected Wang Global reported an estimated net loss of Dfls 115
mln for the Quarter ending March 31, 1999. The loss is consistent
with restructuring actions, previously announced in connection
with the Olsy acquisition. The progress towards the stated goal of
US$ 150-200 million cost saving opportunity, that was announced in
conjunction with the acquisition of Olsy, remains on target.
Adjusted for non-recurring charges, earnings before interest,
taxes, depreciation and amortization in the first quarter of 1999
amounted to an estimated Dfls 104 million.
Getronics background
<PAGE>
Press Release wang (04.05.99) Page 4 of 5
Getronics is one of Europe's largest service-providers in the
field of Information and Communication Technology, with sales of
Dfls 3.5 billion and 12,500 employees.
ICT Services, Getronics' key activity, is arranged in two Business
Groups, in order to offer complete ICT solutions either from the
separate business units or working in partnership with each other:
Business Solutions & Consulting, comprising business
units concerned with Software Solutions, Human Resource
Solutions, Outsourcing and Consulting
System Integration & Network Services, comprising
business units concerned with System Integration and
Infrastructure & Network Services
Getronics offers its customers the opportunity to source a broad
range of sector-specific solutions from a single supplier. The
Group's strength lies in the combination and integration of
various technologies and modules, based on a thorough knowledge of
ICT.
Getronics performs services for the largest companies and
financial institutions, is a prominent player in the non-profit
sector, and a leading partner for government. Getronics' major
business units are currently established in the Benelux countries,
Germany, Scandinavia, Spain, Portugal, the United Kingdom and
Mexico. Getronics has been listed on the Amsterdam Exchanges since
1985.
Financing the Wang Global acquisition
Getronics intends to finance the transaction initially through the
approximately Dfls 0.7 billion proceeds of the 0.25% Subordinated
Convertible Bonds (issued in April of this year) and a bridge loan
for which adequate commitments have been obtained from Getronics'
banks.
Following the completion of the public tender offer, Getronics
intends to refinance the acquisition through a combination of
financing instruments. The financing structure is expected to be
Dfls 0.5 billion in preference shares, Dfls 1.5 billion in
ordinary shares and approximately Dfls 1.0 billion in senior debt.
It is Getronics' view that the resulting financing structure, in
combination with the capitalisation of acquired goodwill and the
operating cash flow will provide a sound financial basis for
future growth.
Anticipated time schedule
The recommended public tender offer will commence on May 10 and
will end on June 7, 1999. It is the intention to start the global
equity offering and the issue of preference shares in due time
after the closing of the public tender offer.
Conditions to completion of the acquisition
<PAGE>
Press Release wang (04.05.99) Page 5 of 5
The agreement signed between Getronics and Wang Global contains a
number of conditions with respect to the closing of the tender
offer. The acquisition will be conditioned, inter alia, upon
approval by US and European anti-trust and other governmental
authorities as far as required. In addition at least a majority of
the common shares of Wang Global (calculated on a fully diluted
basis) will need to have been validly tendered by the holders
thereof.
Analysts' meetings and press conference
Analysts' meetings regarding the transaction will be held on
Tuesday May 4 at: 12.30 am (Amsterdam time) at the World Trade
Centre, Strawinskylaan 1, Amsterdam
17.00 pm (London time) at ABN AMRO offices, 4 Broadgate, London
A press conference will be held on Tuesday May 4 at:
10.00 am (Amsterdam time) at the World Trade Center,
Strawinskylaan 1, Amsterdam
Getronics is being advised by ABN AMRO Bank NV with respect to the
acquisition and the subsequent equity and debt financing. The
bridge loan has been underwritten by ABN AMRO Bank NV and ING
Bank.
Exchange rate used: US$ 1.00 = Dfls 2.00.
Appendix: financial information on Getronics and Wang Global
This does not constitute an offer for sale of securities in the
United States. Securities offered by the Company may not be sold
in the United States absent registration or an exemption from
registration under the U.S. Securities Act of 1933, as amended.
The Company does not intend to register any portion of any
offering in the United States or to conduct a public offering of
securities in the United States.
_________________________________________
For further information:
Getronics NV
Donauweg 10
1043 AJ Amsterdam
The Netherlands
Tel.: +31 20 586 1501
Fax.: + 31 20 586 1568
www.Getronics.nl
<PAGE>
Exhibit (a)(7)
This announcement is neither an offer to purchase nor a solicitation of an offer
to sell Offer Securities. The Offer is made solely by the Offer to Purchase
dated May 10, 1999 Jerry Financial Printing Group This announcement is neither
an offer to purchase nor a solicitation of an offer to sell Offer Securities.
The Offer is made solely by the Offer to Purchase dated May 10, 1999 and the
related Letters of Transmittal and is being made to all holders of Offer
Securities. The Purchaser is not aware of any state where the making of the
Offer is prohibited by any applicable law. If the Purchaser becomes aware of any
jurisdiction where the making of the Offer or the acceptance of Offer Securities
is not in compliance with any applicable law, the Purchaser will make a good
faith effort to comply with such law. If, after such good faith effort, the
Purchaser cannot comply with such law, the Offer will not be made to (nor will
tenders be accepted from or on behalf of) the holders of Offer Securities in
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 the Purchaser by Merrill Lynch, Pierce,
Fenner & Smith Incorporated or one or more registered brokers or dealers
licensed under the laws of such jurisdiction.
Notice of Offer to Purchase for Cash
All of the Outstanding Shares of Common Stock
(Including the Associated Rights),
All of the Outstanding Shares of 4 1/2% Series A Cumulative
Convertible Preferred Stock,
All of the Outstanding Shares of 6 1/2% Series B Cumulative
Convertible Preferred Stock,
All of the Outstanding Depositary Shares
(each representing a 1/20th interest in a Share of
6 1/2% Series B Cumulative Convertible Preferred Stock),
All of the Outstanding Common Stock Purchase Warrants
and
The Outstanding Special Common Stock Warrant
of
Wang Laboratories, Inc.
at
$29.25 Net Per Share of Common Stock,
$1,271.73 Net Per Share of
4 1/2% Series A Cumulative Convertible Preferred Stock,
$1,101.17 Net Per Share of
6 1/2% Series B Cumulative Convertible Preferred Stock,
$55.05 Net Per Depositary Share,
$7.80 Net Per Common Stock Purchase Warrant
and
$6,250,000.00 Net for the Special Common Stock Warrant, respectively,
by
Getronics Acquisition, Inc.
A Wholly-Owned Subsidiary of
Getronics NV
Getronics Acquisition, Inc., a Delaware corporation (the "Purchaser"), and a
wholly-owned subsidiary of Getronics NV, a public company with limited liability
incorporated under the laws of The Netherlands with its corporate seat in
Amsterdam, The Netherlands ("Parent"), is offering to purchase (i) all of the
issued and outstanding shares of common stock, par value $0.01 per share,
including the associated rights (the "Common Stock"), of Wang Laboratories,
Inc., a company organized under the laws of Delaware (the "Company"), at a price
of $29.25 per share of Common Stock, net to the seller in cash, without interest
thereon, (ii) all of the issued and outstanding shares of 4 1/2% Series A
Cumulative Convertible Preferred Stock, par value $0.01 per share (the "Series A
Preferred Stock"), of the Company, at a price of $1,271.73 per share of Series A
Preferred Stock, net to the seller in cash, without interest thereon, (iii) all
of the issued and outstanding shares of 6 1/2% Series B Cumulative Convertible
Preferred Stock, par value $0.01 per share (the "Series B Preferred Stock"), of
the Company, at a price of $1,101.17 per share of Series B Preferred Stock, net
to the seller in cash, without interest thereon, (iv) all of the issued and
outstanding depositary shares, each representing a 1/20th interest in a share of
Series B Preferred Stock (the "Depositary Shares"), at a price of $55.05 per
Depositary Share, net to the seller in cash, without interest thereon, (v) all
of the issued and outstanding warrants (other than the Special Common Stock
Warrant) of the Company to purchase shares of Common Stock (the "Common Stock
Purchase Warrants"), at a price of $7.80 per Common Stock Purchase Warrant, net
to the seller in cash, without interest thereon and (vi) the issued and
outstanding warrant of the Company (the "Special Common Stock Warrant") giving
the holder the right to receive a certain number of shares of Common Stock upon
exercise thereof, at a price of $6,250,000.00, net to the seller in cash,
without interest thereon, upon the terms and subject to the conditions set forth
in the Offer to Purchase dated May 10, 1999 (the "Offer to Purchase") and in the
related Letters of Transmittal (which, as they may be amended and supplemented
from time to time, together constitute the "Offer"). Unless the context
indicates otherwise, as used herein, "Offer Securities" shall mean the shares of
Common Stock, the shares of Series A Preferred Stock, the shares of Series B
Preferred Stock, the Depositary Shares, the Common Stock Purchase Warrants and
the Special Common Stock Warrant. Unless the context indicates otherwise, all
references to shares of Common Stock shall include the associated rights (the
"Rights") issued pursuant to the Rights Agreement, dated as of April 22, 1998,
by and between the Company and the American Stock Transfer and Trust Company
("ASTT"), as Rights Agent.
<PAGE>
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON MONDAY, JUNE 7, 1999, UNLESS THE OFFER IS EXTENDED.
The Offer is conditioned upon, among other things, (i) there being validly
tendered and not properly withdrawn prior to the expiration of the Offer a
number of Offer Securities which represent at least a majority of the Common
Stock Equivalents (as such term is defined in the Offer to Purchase) on the date
of purchase (the "Minimum Condition"), (ii) the receipt of certain governmental
approvals and (iii) the satisfaction of certain other terms and conditions
described in Section 14 of the Offer to Purchase.
The Company has informed the Purchaser that, as of May 3, 1999, there were
issued and outstanding (i) 47,045,593 shares of Common Stock, (ii) 90,000 shares
of Series A Preferred Stock, (iii) 2,875,000 Depositary Shares (representing
143,750 shares of Series B Preferred Stock), (iv) 7,208,935 Common Stock
Purchase Warrants, (v) the Special Common Stock Warrant and (vi) Options
exercisable into 8,941,077 shares of Common Stock. As a result, as of such date,
the Minimum Condition would be satisfied if, in the aggregate, a combination of
Common Stock, Series A Preferred Stock, Series B Preferred Stock, Depositary
Shares, Common Stock Purchase Warrants and the Special Common Stock Warrant
representing 36,367,045 Common Stock Equivalents would be tendered and not
properly withdrawn prior to the expiration of the Offer.
The Offer is being made pursuant to the Agreement and Plan of Merger, dated as
of May 3, 1999 (the "Merger Agreement"), by and among Parent, the Purchaser and
the Company. The Merger Agreement provides that, promptly upon consummation of
the Offer, Parent will cause the Purchaser to be merged with and into the
Company (the "Merger"). At the effective time of the Merger (the "Effective
Time"), except for the Offer Securities which are held by any subsidiary of the
Company or in the treasury of the Company, or which are held, directly or
indirectly, by Parent or any direct or indirect subsidiary of Parent (including
the Purchaser), all of which shall cease to be outstanding and be canceled and
retired and none of which shall receive any payment with respect thereto and
Offer Securities held by holders exercising their rights to dissent in
accordance with the Delaware General Corporation Law ("DGCL"), (i) each share of
Common Stock (including all associated Rights) issued and outstanding
immediately prior to the Effective Time and all rights in respect thereof shall,
by virtue of the Merger and without any action on the part of the holder
thereof, forthwith cease to exist and be converted into and represent the right
to receive an amount in cash equal to $29.25, without interest, (ii) each share
of Series A Preferred Stock issued and outstanding immediately prior to the
Effective Time and all rights in respect thereof shall, immediately prior to the
Merger and without any action on the part of the holders thereof, be converted
into 43.478 fully paid and nonassessable shares of Common Stock, such shares of
Common Stock thereafter to be treated in accordance with clause (i) above, (iii)
each share of Series B Preferred Stock issued and outstanding immediately prior
to the Effective Time shall, by virtue of the Merger and without any action on
the part of the holders thereof, no longer be convertible into shares of Common
Stock without interest but shall thereafter be convertible, in accordance with
Section 7(E) of the Certificate of Designation of the Series B Preferred Stock,
into the right to receive an amount in cash equal to $1,101.17, without
interest, (iv) each Common Stock Purchase Warrant issued and outstanding
immediately prior to the Effective Time and all rights in respect thereof shall,
by virtue of the Merger and without any action on the part of the holders
thereof, no longer be exercisable into the right to receive Common Stock but
shall become exercisable, in accordance with Section 11.5 of the Warrant
Agreement, dated as of October 29, 1993, by and between the Company and ASTT,
into the right to receive an amount in cash equal to $7.80, without interest and
(v) the Special Common Stock Warrant issued and outstanding immediately prior to
the Effective Time and all rights in respect thereof shall, by virtue of the
Merger and without any action on the part of the holder thereof, expire. The
Merger Agreement is more fully described in Section 11 of the Offer to Purchase.
Under the DGCL, if the Purchaser acquires, pursuant to the Offer or otherwise,
at least 90% of the issued and outstanding shares of each of Common Stock, the
Series A Preferred Stock and the Series B Preferred Stock, the Purchaser will be
able to approve and effect the Merger without a vote of the Company's
stockholders. If, however, the Purchaser does not acquire at least 90% of the
issued and outstanding shares of each of the Common Stock, the Series A
Preferred Stock and the Series B Preferred Stock, pursuant to the Offer or
otherwise, a vote of the Company's stockholders to effect the Merger is required
under the DGCL and a longer period of time will be required to effect the Merger
as described in Section 11 of the Offer to Purchase.
<PAGE>
The Board of Directors of the Company (i) has determined that each of the
Offer and the Merger is fair to, and in the best interest of, the holders of the
Offer Securities and has declared that the Offer and the Merger are advisable,
(ii) has approved the Offer and the Merger and (iii) has recommended that the
holders of the Offer Securities accept the Offer and tender their Offer
Securities pursuant to the Offer and that the holders of Common Stock, Series A
Preferred Stock, Series B Preferred Stock and Depositary Shares approve and
adopt the Merger Agreement.
Tendering holders whose Offer Securities are registered in their own name and
who tender directly to the Depositary will not be obligated to pay brokerage
fees or commissions or, except as set forth in Instruction 6 of the applicable
Letter of Transmittal, stock transfer taxes on the purchase of Offer Securities
pursuant to the Offer.
For purposes of the Offer, the Purchaser will be deemed to have accepted for
payment (and thereby purchased) Offer Securities validly tendered and not
properly withdrawn if, as and when the Purchaser gives notice to the Depositary
of the Purchaser's acceptance for payment of such Offer Securities. Upon the
terms and subject to the conditions of the Offer, payment for Offer Securities
accepted pursuant to the Offer will be made by deposit of the purchase price
therefor with the Depositary, which will act as agent for tendering holders for
the purpose of receiving payments from the Purchaser and transmitting payments
to such tendering holders whose Offer Securities have been accepted for payment.
In all cases, payment for Offer Securities purchased pursuant to the Offer will
be made only after timely receipt by the Depositary of (i) the certificates
evidencing such Offer Securities or timely confirmation of a book-entry transfer
of such Offer Securities into the Depositary's account at the Book-Entry
Transfer Facility, pursuant to the procedures set forth in Section 3 of the
Offer to Purchase, (ii) the applicable Letter of Transmittal (or a copy
thereof), properly completed and duly executed with any required signature
guarantees, or an Agent's Message (as defined in Section 2 of the Offer to
Purchase) in connection with a book-entry transfer and (iii) any other documents
required by the applicable Letter of Transmittal. Under no circumstances will
interest be paid on the purchase price for the tendered Offer Securities,
regardless of any delay in making such payment or extension of the Expiration
Date.
The term "Expiration Date" shall mean 12:00 Midnight, New York City time, on
Monday, June 7, 1999, unless and until the Purchaser, in accordance with the
terms of the Offer, 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.
Subject to the terms of the Merger Agreement and to the applicable rules and
regulations of the Securities and Exchange Commission (the "Commission") and to
applicable law, the Purchaser expressly reserves the right, in its sole
discretion, at any time or from time to time, to extend for any reason the
period of time during which the Offer is open, including upon the occurrence of
any of the events specified in Section 14 of the Offer to Purchase, by giving
notice of such extension to the Depositary and by making a public announcement
thereof.
Subject to the applicable rules and regulations of the Commission and to
applicable law, the Purchaser also expressly reserves the right, in its sole
discretion (subject to the terms of the Merger Agreement), at any time and from
time to time (i) to delay acceptance for payment of, or, regardless of whether
such Offer Securities were theretofore accepted for payment, payment for, any
Offer Securities pending receipt of any governmental approval specified in
Section 15 of the Offer to Purchase or in order to comply in whole or in part
with any other applicable law, (ii) to terminate the Offer and not accept for
payment any Offer Securities if any of the conditions referred to in Section 14
of the Offer to Purchase are not satisfied or, of the events specified in
Section 14 of the Offer to Purchase have occurred and (iii) subject to the terms
of the Merger Agreement, to waive any condition, or otherwise amend the Offer in
any respect, in each case by giving oral or written notice of such delay,
termination, waiver or amendment to the Depositary and by making a public
announcement thereof.
During any such extension, all Offer Securities previously tendered and not
properly withdrawn will remain subject to the Offer, subject to the right of a
tendering holder to withdraw such holder's Offer Securities. Any such extension,
delay, termination, waiver or amendment will be followed, as promptly as
practicable, by a public announcement thereof by no later than 9:00 a.m., New
York City time, on the next business day after the previously scheduled
Expiration Date. Subject to applicable law (including Rules 14d-4(c), 14d-6(d)
and 14e-1 under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), which require that material changes be promptly disseminated to holders
in a manner reasonably designed to inform them of such changes and without
limiting the manner in which the Purchaser may choose to make any public
announcement, the Purchaser will have no obligation to publish, advertise or
otherwise communicate any such public announcement other than by issuing a press
release to the Dow Jones News Service or as otherwise may be required by
applicable law.
<PAGE>
Except as otherwise provided below, tenders of Offer Securities made pursuant
to the Offer are irrevocable. Offer Securities tendered pursuant to the Offer
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 8, 1999, or at such later time as may
apply if the Offer is extended. For a withdrawal to be effective, a written
notice of withdrawal must be timely received by the Depositary at one of its
addresses set forth below. Any such notice of withdrawal must specify the name
of the person who tendered the Offer Securities to be withdrawn, the class of
Offer Securities to be withdrawn, the number of Offer Securities to be
withdrawn, and the name of the registered holder of the Offer Securities, if
different from that of the person who tendered such Offer Securities. If
certificates evidencing Offer Securities to be withdrawn have been delivered or
otherwise identified to the Depositary, then, prior to the physical release of
such certificates, the tendering holders must submit to the Depositary the
serial numbers shown on the particular certificate evidencing the Offer
Securities to be withdrawn and, unless the Offer Securities evidenced by such
certificates have been tendered by an Eligible Institution (as defined in
Section 3 of the Offer to Purchase) the signatures on the notice of withdrawal
must be guaranteed by an Eligible Institution. If Offer Securities have been
tendered pursuant to the procedures for book-entry transfer 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 Offer Securities and must otherwise comply with the Book-
Entry Transfer Facility's withdrawal procedures.
Withdrawals of tendered Offer Securities may not be rescinded without the
Purchaser's consent and any Offer Securities properly withdrawn will thereafter
be deemed not validly tendered for purposes of the Offer. 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, which determination will
be final and binding. None of Parent, the Purchaser, the Depositary, the
Information Agent, the Dealer Manager 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
Offer Securities properly withdrawn may be re-tendered at any time prior to the
Expiration Date by following any of the procedures described in Section 3 of the
Offer to Purchase.
The Company has provided the Purchaser with the Company's list of holders of
the Offer Securities and security position listings in respect of the Offer
Securities for the purpose of disseminating the Offer to the holders of Offer
Securities. The Offer to Purchase, the Letters of Transmittal and any other
relevant materials will be mailed to record holders of Offer Securities whose
names appear on the Company's list of holders of the Offer Securities and will
be furnished, for subsequent transmittal to beneficial owners of Offer
Securities, to brokers, dealers, commercial banks, trust companies and similar
persons whose names or the names of whose nominees, appear on the Company's list
of holders of the Offer Securities, or where applicable, who are listed as
participants in a clearing agency's security position listing.
The information required to be disclosed by paragraph (e)(1)(vii) of Rule 14d-
6 under the Exchange Act is contained in the Offer to Purchase and is
incorporated herein by reference.
The Offer to Purchase and the related Letters of Transmittal contain important
information that should be read carefully before any decision is made with
respect to the Offer.
Requests for copies of the Offer to Purchase, the related Letters of
Transmittal and other tender offer materials may be directed to the Information
Agent as set forth below, and copies will be furnished promptly at the
Purchaser's expense. Questions or requests for assistance may be directed to the
Information Agent or the Dealer Manager as set forth below.
The Information Agent for the Offer is:
MORROW & CO., INC.
445 Park Avenue, 5th Floor
New York, New York 10022
Banks and Brokerage Firms Call: (800) 662-5200
Shareholders Please Call: (800) 566-9061
The Depositary for the Offer is:
Citibank, N.A.
By Hand:
Citibank, N.A.
Corporate Actions
111 Wall Street, 5th Floor Window
New York, New York 10043
By Mail:
Citibank N.A.
Corporate Actions
P.O. Box 2544
Jersey City, New Jersey 07303-2544
By Overnight Courier:
Citibank N.A.
Corporate Actions, Suite 4660
525 Washington Boulevard
Jersey City, New Jersey 07303
For Information: (877) 248-4237
The Dealer Manager for the Offer is:
Merrill Lynch & Co.
World Financial Center
North Tower
New York, New York 10281-1305
(212) 449-8971 (Call Collect)
May 10, 1999
<PAGE>
Exhibit (a)(8)
THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are
in any doubt as to the action to be taken, you should seek your own financial
advice immediately from your own appropriately authorized independent
financial advisor. If you have sold or transferred all of your registered
holdings of Offer Securities (as defined below), please forward this document
and all accompanying documents to the stockbroker, bank or other agent
through whom the sale or transfer was effected, for transmission to the
purchaser or transferee.
NOTICE OF GUARANTEED DELIVERY
(Not to be used for Signature Guarantees)
For Tender of Shares of Common Stock (Including the Associated Rights), Shares
of 6 1/2% Series B Cumulative Convertible Preferred Stock, Depositary Shares
(each representing a 1/20th interest in a share of 6 1/2% Series B Cumulative
Convertible Preferred Stock) and/or Common Stock Purchase Warrants
of
Wang Laboratories, Inc.
Pursuant to the Offer to Purchase
dated May 10, 1999
by
Getronics Acquisition, Inc.
A Wholly-Owned Subsidiary of
Getronics NV
As set forth under Section 3--"Procedures for Tendering Offer Securities" in
the Offer to Purchase dated May 10, 1999, and any supplements or amendments
thereto (the "Offer to Purchase"), this form (or a copy hereof) must be used
to accept the Offer if (i) certificates representing (a) shares of common
stock, par value $0.01 per share, including the associated rights (the "Common
Stock"), (b) shares of 6 1/2% Series B Cumulative Convertible Preferred Stock,
par value $0.01 per share (the "Series B Preferred Stock"), (c) depositary
shares, each representing a 1/20th interest in a share of Series B Preferred
Stock (the "Depositary Shares") and/or (d) warrants, other than the Special
Common Stock Warrant (as defined in the Offer to Purchase), to purchase shares
of Common Stock (the "Common Stock Purchase Warrants" and together with the
Common Stock, Series B Preferred Stock and Depositary Shares, collectively,
the "Offer Securities"), of Wang Laboratories, Inc., a Delaware corporation
(the "Company"), are not immediately available, (ii) if the procedures for
book-entry transfer cannot be completed on a timely basis, or (iii) time will
not permit the certificates representing Offer Securities and all other
required documents to reach Citibank, N.A. (the "Depositary") prior to the
Expiration Date (as defined in Section 1--"Terms of the Offer" of the Offer to
Purchase). This Notice of Guaranteed Delivery may be delivered by hand, by
mail or by overnight courier to the Depositary and must include a signature
guarantee by an Eligible Institution in the form set forth herein. See the
Guaranteed Delivery Procedures described in the Offer to Purchase under
Section 3--"Procedures for Tendering Offer Securities". Certain terms used
herein and not otherwise defined herein shall have the meanings assigned to
them in the Offer to Purchase.
The Depositary for the Offer is:
Citibank, N.A.
<TABLE>
<S> <C> <C>
By Hand: By Mail: By Overnight Courier:
Citibank, N.A. Citibank, N.A. Citibank, N.A.
Corporate Actions Corporate Actions Corporate Actions
111 Wall Street, 5th Floor P.O. Box 2544 525 Washington Boulevard, Suite 4660
Window Jersey City, New Jersey 07303-2544 Jersey City, New Jersey 07303
New York, New York 10043
</TABLE>
For Information:
(877) 248-4237
Delivery of this Notice of Guaranteed Delivery to an address other than as
set forth above does not constitute a valid delivery.
This Notice of Guaranteed Delivery is not to be used to guarantee a
signature. 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. See Signature Guarantee in Section
3--"Procedures for Tendering Offer Securities" of the Offer to Purchase.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Getronics Acquisition, Inc., a Delaware
corporation and a wholly-owned subsidiary of Getronics NV, a public company
with limited liability incorporated under the laws of The Netherlands with its
corporate seat in Amsterdam, The Netherlands, under 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
Offer Securities indicated below pursuant to the Guaranteed Delivery
Procedures described in the Offer to Purchase under Section 3--"Procedures for
Tendering Offer Securities".
OFFER SECURITIES TENDERED:
Number of Offer Securities:
(a) Common Stock:
------------------------------------------------------
(b) Series B Preferred Stock:
-----------------------------------------------
(c) Depositary Shares:
----------------------------------------------------
(d) Common Stock Purchase Warrants:
--------------------------------------
Certificate Numbers (if available):
(a) Common Stock:
------------------------------------------------------
(b) Series B Preferred Stock:
-----------------------------------------------
(c) Depositary Shares:
----------------------------------------------------
(d) Common Stock Purchase Warrants:
-------------------------------------
Name of Record Holder(s):
---------------------------------------------------
Address:Area Code and Tel. No.:
----------------------------------------------
Signature(s):
--------------------------------------------------------------
Date:
-------------------------------------------------------------------
<PAGE>
THE GUARANTEE BELOW MUST BE COMPLETED
GUARANTEE
(Not to be used for signature guarantee)
The undersigned, an Eligible Institution (as defined in the Offer to
Purchase), hereby guarantees that the undersigned will deliver to the
Depositary, at one of its addresses set forth above, the certificates
representing the Offer Securities tendered hereby, in proper form for
transfer, together with a properly completed and duly executed Letter of
Transmittal or with any required signature guarantees and any other required
documents, all within three New York Stock Exchange trading days after the
date hereof.
Name of Firm: Authorized Signature:
Name:
------------------------------------- ------------------------------
Address: Title:
------------------------------ ------------------------------
(Zip Code)
Date:
------------------------------
Area Code and Tel. No.:
------------------
NOTE: DO NOT SEND CERTIFICATES REPRESENTING OFFER SECURITIES WITH THIS NOTICE
OF GUARANTEED DELIVERY; CERTIFICATES REPRESENTING OFFER SECURITIES
SHOULD BE SENT WITH YOUR LETTER OF TRANSMITTAL.
3
<PAGE>
Exhibit (a)(9)
THIS DOCUMENT IS IMPORTANT AND REQUIRES YOUR IMMEDIATE ATTENTION. If you are
in any doubt as to the action to be taken, you should seek your own financial
advice immediately from your own appropriately authorized independent
financial advisor. If you have sold or transferred all of your registered
holdings of Securities (as defined below), please forward this document and
all accompanying documents to the stockbroker, bank or other agent through
whom the sale or transfer was effected, for transmission to the purchaser or
transferee.
NOTICE OF GUARANTEED DELIVERY
(Not to be used for Signature Guarantees)
For Tender of Shares of 4 1/2% Series A Cumulative Convertible Preferred Stock
and/or
the Special Common Stock Warrant
of
Wang Laboratories, Inc.
Pursuant to the Offer to Purchase
dated May 10, 1999
by
Getronics Acquisition, Inc.
A Wholly-Owned Subsidiary of
Getronics NV
As set forth under Section 3--"Procedures for Tendering Offer Securities" in
the Offer to Purchase dated May 10, 1999, and any supplements or amendments
thereto (the "Offer to Purchase"), this form (or a copy hereof) must be used
to accept the Offer if (i) certificates representing (a) shares of 4 1/2%
Series A Cumulative Convertible Preferred Stock, par value $0.01 per share
(the "Series A Preferred Stock") and/or (b) the warrant to purchase a certain
number of shares of Common Stock upon exercise thereof (the "Special Common
Stock Warrant" and together with the "Series A Preferred Stock," the
"Securities"), of Wang Laboratories, Inc., a Delaware corporation (the
"Company"), are not immediately available or (ii) time will not permit
certificates representing the Securities and all other required documents to
reach Citibank, N.A. (the "Depositary") prior to the Expiration Date (as
defined in Section 1--"Terms of the Offer" of the Offer to Purchase). This
Notice of Guaranteed Delivery may be delivered by hand, by mail or by
overnight courier to the Depositary and must include a signature guarantee by
an Eligible Institution in the form set forth herein. See the Guaranteed
Delivery Procedures described in the Offer to Purchase under Section 3--
"Procedures for Tendering Offer Securities". Certain terms used herein and not
otherwise defined herein shall have the meanings assigned to them in the Offer
to Purchase.
The Depositary for the Offer is:
Citibank, N.A.
<TABLE>
<S> <C> <C>
By Hand: By Mail: By Overnight Courier:
Citibank, N.A. Citibank, N.A. Citibank, N.A.
Corporate Actions Corporate Actions Corporate Actions
111 Wall Street, 5th Floor P.O. Box 2544 525 Washington Boulevard, Suite 4660
Window Jersey City, New Jersey 07303-2544 Jersey City, New Jersey 07303
New York, New York 10043
</TABLE>
For Information:
(877) 248-4237
Delivery of this Notice of Guaranteed Delivery to an address other than as
set forth above does not constitute a valid delivery.
This Notice of Guaranteed Delivery is not to be used to guarantee a
signature. 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. See Signature Guarantee in Section
3--"Procedures for Tendering Offer Securities" of the Offer to Purchase.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Getronics Acquisition, Inc., a Delaware
corporation and a wholly-owned subsidiary of Getronics NV, a public company
with limited liability incorporated under the laws of The Netherlands with its
corporate seat in Amsterdam, The Netherlands, under 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
Securities indicated below pursuant to the Guaranteed Delivery Procedures
described in the Offer to Purchase under Section 3--"Procedures for Tendering
Offer Securities".
SECURITIES TENDERED:
Number of Securities:
(a) Series A Preferred Stock:
----------------------------------------------------
(b) Special Common Stock Warrant:
-------------------------------------------
Certificate Numbers (if available):
(a) Series A Preferred Stock:
----------------------------------------------------
(b) Special Common Stock Warrant:
-------------------------------------------
Name of Record Holder(s):
--------------------------------------------------------
Address:
--------------------------------------------------------------------
Area Code and Tel. No.:
---------------------------------------------------------
Signature(s):
-----------------------------------------------------------------
Date:
----------------------------------------------------------------------
2
<PAGE>
THE GUARANTEE BELOW MUST BE COMPLETED
GUARANTEE
(Not to be used for signature guarantee)
The undersigned, an Eligible Institution (as defined in Section 3--
"Procedures for Tendering Offer Securities" in the Offer to Purchase), hereby
guarantees that the undersigned will deliver to the Depositary, at one of its
addresses set forth above, the certificates representing the Securities
tendered hereby, in proper form for transfer, together with a properly
completed and duly executed Letter of Transmittal or with any required
signature guarantees and any other required documents, all within three New
York Stock Exchange trading days after the date hereof.
Name of Firm: Authorized Signature:
Name:
------------------------------------- ------------------------------
Address: Title:
------------------------------ ------------------------------
(Zip Code)
Date:
------------------------------
Area Code and Tel. No.:
------------------
NOTE: DO NOT SEND CERTIFICATES REPRESENTING SECURITIES WITH THIS NOTICE OF
GUARANTEED DELIVERY; CERTIFICATES REPRESENTING SECURITIES SHOULD BE SENT
WITH YOUR LETTER OF TRANSMITTAL.
3
<PAGE>
Exhibit (a)(10)
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 --
- --------------------------------------------------------
<C> <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)
Custodian account of a The minor(2)
minor (Uniform Gift to
4. Minors Act)
5. Adult and minor (joint The adult or, if
account) the minor is the
only
contributor, the
minor(1)
Account in the name of The ward, minor,
guardian or committee for a or incompetent
designated ward, minor, or person(3)
6. incompetent person
7. a. The usual revocable sav-
ings trust account The grantor-
(grantor is also trustee) trustee(1)
b. So-called trust account The actual
that is not a legal or owner(1)
valid trust under State
law
8. Sole proprietorship account The owner(4)
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Give the EMPLOYER
For this type of account: IDENTIFICATION
number of --
- ------------------------------------------------------------------------------
<S> <C>
9. A valid trust, estate, or pension trust Legal entity (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 educational organization The organization
account
12. Partnership account held in the name of the business The partnership
13. Association, club, or other tax-exempt organization The organization
14. A broker or registered nominee The broker or
nominee
15. Account with the Department of Agriculture in the name The public
of a public entity (such as a State or local government, entity
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
. 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 of mortgage interest to you.
Exempt payees described above should file Form W-9 to avoid possible errone-
ous backup withholding.
FILE THIS FORM WITH THE PAYOR, 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
withholding. For details, see the regulations under sections 6041, 6041A(a),
6045, and 6050A.
Privacy Act Notice.-- Section 6109 requires most recipients of dividend, in-
terest, or other payments to give taxpayer identification numbers to payers
who must report the payments to IRS. IRS uses the numbers for identification
purposes. Payers must be given the numbers whether or not recipients are re-
quired to file tax returns. Beginning January 1, 1993, 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. Cer-
tain 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 sub-
ject to a penalty of $50 for each such failure unless your failure is due to
reasonable cause and not to willful neglect.
(2) Failure to Report Certain Dividend and Interest Payments.--If you fail to
include any portion of an includable payment for interest, dividends, or pat-
ronage dividends in gross income, such failure will be treated as being due to
negligence and will be subject to a penalty of 20% on any portion of an under-
payment attributable to that failure unless there is clear and convincing evi-
dence to the contrary.
(3) 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.
(4) Criminal Penalty for Falsifying Information.--Falsifying certifications or
affirmations may subject you to criminal penalties including fines and/or im-
prisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE
SERVICE
Obtaining a Number
If you don't have a taxpayer identification number or you do not 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 ap-
ply 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 re-
tirement 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 U.S. or
a possession of the U.S.
. A real estate investment trust.
. A common trust fund operated by a bank under section 584(a)
. An exempt charitable remainder trust, or a non-exempt trust described in
section 4947(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 U.S. 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 indi- viduals. 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 pro-
vided your correct taxpayer identification number to the payer.
<PAGE>
EXHIBIT (b)(1)
ABN AMRO BANK N.V. ING BANK N.V.
COMMITMENT LETTER
3 May, 1999
Getronics N.V.
Attention: J. L. Docter, Chief Financial Officer
Dear Sirs,
NLG 4,000,000,000 Multicurrency Bridge Facility (The "Facility") - Commitment
Letter
1. COMMITMENT TERMS
You have advised us that Getronics N.V. ("Geniaal") wishes to establish the
Facility, the proceeds of which would be used by a direct wholly-owned
subsidiary of Geniaal, to finance the acquisition by a Delaware company wholly-
owned by Geniaal (the "Buyer") of Wang Laboratories, Inc. ("Target") and to
refinance existing indebtedness of Target. You have further advised us that it
is your intention to refinance the Facility out of the proceeds of an equity
issue in the Geniaal group (the "Equity Issue") and a medium term debt facility
(the "New Facility") on or prior to 364 days after the date of signing of the
definitive documentation.
You have advised us that the Buyer will be formed for the purpose of acquiring
all of the outstanding shares in the Target (collectively the "Shares").
We understandd that the Acquisition will be accomplished through a cash tender
offer (the "Tender Offer") by the Buyer for up to 100% of the Shares followed by
a merger (the "Merger") of the Buyer with and into Target, in which Target will
be the surviving corporation and in which any Shares not tendered in the Tender
Offer will be cancelled in exchange for cash consideration pursuant to a merger
agreement between Geniaal, the Buyer and Target to be provided to us (the
"Merger Agreement"). We further understand that the Tender Offer will be
conditioned on, among other things, the tender and purchase of at least that
number of Shares required to permit the Buyer to cause the Merger to occur (the
"Minimum Condition"). You have advised us that the Merger Agreement will be
signed prior to the funding of the Facility. Upon the consummation of the
Acquisition, Target will be controlled, directly or indirectly, by Geniaal.
ABN AMRO Bank N.V., and ING Bank N.V. (together the "Arrangers" and each an
"Arranger") are pleased to inform you of our commitment to provide the entire
amount of the Facility, on a several basis, as follows:
ABN AMRO Bank N.V.- NLG 2,000,000,000
ING Bank N.V.- NLG 2,000,000,000
-1-
<PAGE>
subject to (a) the terms and conditions described in this letter (the "Letter")
and the attached Terms and Conditions (the "Term Sheet") and (b) security, in
the form and substance satisfactory to the Arrangers, over all Shares in the
Target upon consummation of the Merger. This Letter should be read in
conjunction with the fee letter of even date herewith (the "Fee Letter"). This
Letter, the Term Sheet and the Fee Letter are referred to collectively as the
"Documents".
2. CONDITIONS PRECEDENT
The Arrangers' commitment is subject to:
(a) the preparation, execution and delivery of mutually acceptable financing
documentation, negotiated in good faith and incorporating, inter alia,
the terms and conditions outlined in the Term Sheet;
(b) the absence of (a) a Material Adverse Effect (as defined in the draft of
the Merger Agreement dated 1 May 1999) in relation to the Target, (b) an
event or circumstance occurs which has caused or will cause a material
adverse change in the condition of the Geniaal group taken as a whole
and which has or could be expected to have an adverse effect on the
ability of Geniaal to meet its payment obligations in relation to the
Documents and/or the definitive facility documents taking into account
the value of the assets and revenues to be purchased in the proposed
acquisition of Urget and (c) the absence of any event set out in
paragraph (v)(d) of Annex A to the draft of the Merger Agreement dated
1 May 1999;
(c) the absence of any event set out in paragraph (v)(a) of Annex A to the
draft of the Merger Agreement dated 1 May 1999; and
(d) the accuracy and completeness in all material respects of all
representations that you or the Buyer make to the Arrangers or Lenders
(as defined below) and all information that you furnish to the Arrangers
or Lenders (as defined below) and your compliance in all material
respects with the terms of the Documents.
3. SYNDICATION
3.1. You hereby agree that the Arrangers (or their affiliates) shall act as
sole arrangers for the Facility unless otherwise agreed.
3.2. The Arrangers reserve the right at any time to syndicate (pro rata in
proportion to the commitment of each) part of their several commitments
to one or more other financial institutions, after consultation with
Geniaal, (such institutions being collectively referred to as the
"Lenders") and intend to commence such syndication promptly.
3.3. The Arrangers will manage all aspects of the syndication in consultation
with Geniaal, including the timing of all offers to potential Lenders,
the acceptance of commitments, and the determination of the amounts
offered and the compensation provided however that in no event will you
be required to pay any compensation in excess of what is described in
the Fee Letter. You agree to take all action and provide all
information as
-2-
<PAGE>
any Arranger may reasonably request (unless you can demonstrate to
the satisfaction of such Arranger, acting reasonably, that such
information cannot be obtained) to assist it in forming a syndicate
(including making your senior management and representatives available
at meetings with potential Lenders) and to use your commercially
reasonable efforts to ensure that the syndication efforts benefit from
your banking relationships.
3.4. To ensure an orderly and effective syndication of the Facility you agree
that until the termination of the syndication (as reasonably determined
by the Arrangers), you (and your subsidiaries) will not (and you will
make all reasonable efforts to procure that your affiliates will not)
announce, syndicate or issue any debt facility or debt securities in the
international banking or capital markets (other than the medium term
facility referred to in the first paragraph of paragraph 1 of this
letter), without the prior written consent of the Arrangers (such
consent not be to unreasonably withheld).
4. COMMITMENT TERMINATION
Each Arranger's commitment set forth in this Letter will terminate at 5.00 p.m.
Amsterdam time on 5 May, 1999 unless accepted prior to such time. Prior to such
date, this Letter may be terminated by an Arranger if the Arranger reasonably
believes that you require to raise any financial indebtedness other than
pursuant to the Facility in order to make the Tender Offer. The provisions of
the Fee Letter and Paragraphs 5, 6 and 7 hereof shall survive the expiration or
termination of this letter. In case of any conflict between the terms of this
Letter and the Fee Letter (on the one hand) and the term of the definitive
documentation to be put in place in order to grant the Facility (on the other)
the terms of such documentation shall prevail.
5. INDEMNIFICATION
5.1. Whether or not the Facility is consummated you hereby indemnify and
agree to hold harmless each Arranger, each Lender and in each case each
of their respective affiliates and each of their respective officers,
directors, employees, agents, advisors and representatives (each, an
"Indemnified Party") from and against any and all claims, damages,
losses, liabilities, costs and expenses (including, without limitation,
properly incurred fees and disbursements of counsel), joint or several,
that may be incurred by or asserted or awarded against any Indemnified
Party, in each case arising out of or in connection with or relating to
any investigation, litigation or proceeding or the preparation of any
defence with respect thereto, arising out of or in connection with or
relating to the Documents or the loan documentation or the transactions
contemplated hereby or thereby or any use made or proposed to be made
with the proceeds of the Facility, whether or not such investigation,
litigation or proceeding is brought by you, the Buyer, the Target, any
of your, the Buyer's or the Target's shareholders or creditors, an
Indemnified Party or any other person, or an Indemnified Party is
otherwise a party thereto, except to the extent such claim, damage,
loss, liability, cost or expense has resulted from such Indemnified
Party's gross negligence or wilful misconduct or breach of a material
provision of the Documents or the definitive facility agreement.
-3-
<PAGE>
5.2. You agree that no Indemnified Party shall have any liability whatsoever
to you or the Buyer for or in connection with the transactions referred
to above, except to the extent such liability results from such
Indemnified Party's gross negligence or wilful misconduct or breach of
any of the material provisions of the Documents or the definitive
facility agreement but save that in those circumstances where liability
arises no Indemnified Party shall have any liability to you for loss
(whether direct or indirect) of profits, business or anticipated savings
or for any indirect or consequential loss.
6. CONFIDENTIALITY/INFORMATION
6.1. You agree that the Documents (and any Lenders' commitments) are for your
confidential use and benefit only and may not be relied on by any other
person and their existence and terms way only be disclosed by you to
your officers, employees and advisors, and then only on a "need to know"
basis in connection with the transactions contemplated thereby and on a
confidential basis, except that you may disclose the terms of the
Documents as required by applicable law (including in any filing made
under United States Federal securities law) and except that you may
disclose the term of this Letter and the related Term Sheet to Target,
its officers, employees and advisors on the same basis as set forth
above. In addition, following the appointment of the Arrangers you may
disclose each Arranger's identity as an arranging bank and ABN AMRO Bank
N.V.'s identity as agent bank.
6.2. Each Arranger (or affiliates) may be providing banking services to
parties whose interests may conflict with yours or the Buyer's. Neither
any such Arranger nor any of its affiliates will furnish confidential
information obtained from you to any of its other customers or make
available to you confidential information from any other customer.
6.3. You represent and warrant that (i) all information that has been or will
hereafter be made available to the Arrangers, any Lender or any
potential Lender by you or any of your subsidiaries or any of your or
your subsidiaries' representatives in connection with the transactions
contemplated hereby, except to the extent derived from other identified
sources and merely passed on by such person, is and will be complete and
correct in all material respects in light of the circumstances under
which such statements were or are made and (ii) all financial
projections provided by you to the Arrangers, any Lender or potential
Lender will be prepared in good faith and based on reasonable
assumptions although we recognise they can be subject to uncertainties
as to their realisation. You further agree that you will ensure all such
information (other than the financial projections) remains correct in
all material respects and up to date in all material respects. The
Arrangers will not verify and will rely on, the accuracy of any
information you provide.
7. GOVERNING LAW/JURISDICTION/ENTIRE AGREEMENT
The Documents shall be governed by, and construed in accordance with, the laws
of England. The parties hereto submit to the non-exclusive jurisdiction of the
English courts and waive any defence of inconveniet forum which may be
available. You hereby irrevocably appoint Getech
-4-
<PAGE>
Ltd. as your agent for service of process hereunder, which appointment is
hereby confirmed by Getech Ltd. by its countersignature of this letter. The
Documents set forth the entire agreement between the parties with respect to the
matters addressed therein and supersede all prior communications, written or
oral, with respect thereto and may only be modified in writing.
Please indicate your acceptance of the provisions hereof by signing the enclosed
copy of this Letter and the Fee Letter and returning them, together with the
fees then payable under the Fee Letter, to ABN AMRO Bank N.V., Foppingadreef,
20-22, 1102 BS, Amsterdam (Attention: Madeleine Jacobs/Ross Langley) At or
before 5:00 p.m. (Amsterdam time) on 5 May 1999, the time at which the
commitnent offer of the Arrangers set forth above (if not so accepted prior
thereto will expire). If you elect to deliver the above documents by facsimile
(which shall be effective upon receipt), please arrange for the executed
originals to follow by next-day courier.
Yours faithfully,
ABN AMRO BANK N.V.
By: /s/ Madeleine Jacobs /s/[illegible]
--------------------- ---------------
Madeleine Jacobs [illegible]
Title: SVP
INB BANK N.V.
By: /s/ Hiel /s/ Schorer
-------- ---------------
D. Hiel D.F.I. SCHORER
Title:
GETRONICS N.V.
By: /s/ Jan L. Docter
---------------------
Jan L. Docter
Title: (C.F.O.)
-5-
<PAGE>
SUBJECT TO CONTRACT
3 May 1999
PROJECT MANUAL
NLG 4,000,000,000
MULTICURRENCY BRIDGE FACILITY
TERMS AND CONDITIONS
Borrower(s): Such entity as may be designated by Geniaal and
approved by the Arrangers. Borrowings may be
routed through other borrowing entities subject
to satisfactory documentation
Guarantors and Security: Getronics N.V. and other members of the
Getronics group and the Target group (as
permitted by applicable law) at a level to be
determined.
Security in form and substance satisfactory to
the Arrangers over all shares in the Target upon
consummation of the merger.
Agent: ABN AMRO Bank N.V.
Arrangers: ABN AMRO Bank N.V. and ING Bank, N.V.
Underwriters: ABN AMRO Bank N.V. and ING Bank N.V. are willing
to underwrite the Facility, on a 50/50 basis.
Lenders: A group of banks and other financial
institutions to be assembled by the Arrangers in
consultation with the Borrower.
Target: Wang Laboratories, Inc.
Total Amount of Facility: NLG 4,000,000,000.
Description of Facility: The total amount will be vailable in two
tranches:
Tranche A:
NLG 3,000,000,000 short term loan facility.
1
<PAGE>
SUBJECT TO CONTRACT
3 May 1999
Tranche B: NLG 1,000,000,000
revolving standby credit facility. Any
extension of Existing US Facility
arranged by Banker's Trust will require
prior approval of the Arrangers
Currency: Multicurrency
Purpose: Tranche A:
To finance the acquisition of Target (the
"Acquisition")
Tranche B:
To refinance a maximum of
$500,000,000 of the existing standby
facility of Target and for other general
corporate purposes.
Availability Period: Tranche A: Available for Drawdown
on the closing date of the Acquisition
under 180 days after the closing date.
Tranche B: Available for Drawdown
on the closing date of the Acquisition and
at any time thereafter on a fully revolving
basis.
Notice Period: No later than 10.00am (Amsterdam time)
four business days before the proposed
Drawdown date (or such shorter period
as may be acceptable to the Arrangers).
Minimum Drawings: Minimum amounts of NLG 50,000,000
and in integral multiples of NLG
10,000,000.
Repayment: Tranche A: In full on or before the
Final Maturity Date.
Tranche B. Each advance will be
repaid at the end of the term relating
thereto. Amounts repaid will be available
for redrawing up to one month (or such
lesser period as may be agreed) prior to
the Final Maturity Date.
2
<PAGE>
SUBJECT TO CONTRACT
3 May 1999
<TABLE>
<S> <C>
Final Maturity Date: 364 days after signing of the Facility
Agreement
Source of Repayment/Mandatory Prepayment: Source of repayment is expected to be
from the proceeds of equity issues by the
Geniaal or one of its subsidiaries, asset
sales, if any (as to which see below) and
a medium term debt facility. The amount
raised by each of (a) the equity issues and
(b) the medium term debt facility is
expected to be NLG 2,000,000,000
respectively.
All net proceeds from the disposal of
assets (other than margin stock and other
customary exceptions, including sale and
leaseback transactions relating to new
buildings subject to a cap on the amount
of the value thereof of NLG 25,000,000
in aggregate) in excess of a de minimis
level to be agreed shall be applied in
mandatory prepayment of the Facility.
All amounts so prepaid shall be applied
first towards the prepayment of Tranche
A and secondly toward the prepayment
and/or cancellation of Tranche B. Timing
and/or mechanics of prepayments to be
permitted to minimise breakage costs.
Volluntary Prepayment/Cancellation: Subject to liability for broken funding
costs in respect of the interest period
during which such prepayment is made,
the Borrower may prepay Advances, at
any time, in minimum amounts of NLG
50,000,000 and integral multiples of
NLG 10,000,000.
Amounts prepaid under Tranche B will
be available for redrawing until the Final
Maturity Date. Amounts prepaid under
Tranche A will not be available for
redrawing.
The Borrower may cancel the whole or a
minimum amount of NLG 50,000,000
and integral multiples of NLG
</TABLE>
3
<PAGE>
SUBJECT TO CONTRACT
3 May 1999
10,000,000 of the undrawn portion of
Tranche B on 5 business days' written
notice, without penalty
Interest rate on advances under The aggregate of:
Tranche A and Tranche B;
(a) LIBOR/EURIBOR; and
(b) The applicable Margin.
Interest Will accrue from day to day and
be calculated on the basis of the
actual number of days elapsed in a year
of 360 days (or, if different, in
accordance with market practice).
Margin: 1.00 per cent. per annum until 30
September 1999.
From 30 September 1999 and thereafter
until 31 December 1999: 1.25 per cent.
per annum.
From 31 December 1999 and thereafter
1.25 per cent. per annum unless the
amount of the uncancelled amount of
Facility as at close of business in
Amsterdam on 31 December 1999 is
more than NLG 2,000,000,000 in which
case the margin for such period shall
increase to 1.75 per cent. per annum
LIBOR/EURIBOR: Set by reference to the relevant
Telerate page or, if not available, on
the basis of rates provided by three
Reference Banks.
Default Interest: The applicable interest rate plus 2 per
cent. per annum applicable to overdue
amounts.
Agency Fee: As agreed between the Agent and
Geniaal, payable annually in advance.
Commitment Fee: A rate per annum from time to time
equal to 50% of the applicable margin at
such time (subject to a maximun of 0.75
per cent. Per annum) calculated on the
undrawn amount of the Facility and
4
<PAGE>
SUBJECT TO CONTRACT
3 May 1999
payable from the earlier of (i) the date
of signature of the Facility and (ii) 30
days from the date of signature of the
Commitment Letter, until the Final
Maturity Date quarterly in arrears and
on the Final Maturity Date.
Conditions Precedent: Subject to any waivers granted by the
Arrangers (in their discretion), the
material conditions precedent will be as
follows;
(a) Constitutive documents,
appropriate authorizing
resolutions and corporate
approvals, signature lists
satisfactory to the Arrangers
(acting reasonably) and legal
opinions, satisfactory to the
Arrangers (acting reasonably),
from counsel to the Arrangers in
The Netherlands and England, and
from counsel to each of Geniaal
and the Arrangers in the United
States;
(b) Payment of all properly incurred
fees, costs and expenses of the
Agent, the Arrangers and their
legal counsel (including VAT);
c) Process agent acceptance for the
Borrower and the Guarantors,
d) Receipt of all necessary
governmental and regulatory
approvals;
(e) Compliance with all appropriate,
laws and regulations, including,
without limitation, stock
exchange regulations);
(f) no actual or threatened material
litigation in relation to the
Acquisition, Target, Geniaal or
any of its subsidiaries;
5
<PAGE>
SUBJECT TO CONTRACT
3 May 1999
(g) no material adverse change in
condition of Geniaal and its
subsidiaries taken as a whole
since 31 December 1998; [Note:
wording to be agreed - to
reflect the ability to pay and
to take into account the
acquisition of Target]
(h) the material terms of the
tender offer made by the
Purchaser (being Geniaal or
other wholly owned entity
established for this purpose),
for the shares in Target (the
"Tender Offer") are reasonably
acceptable to the Arrangers;
(i) at least 51 per cent. of shares,
representing voting control,
have been tendered and the
Purchaser has the unrestricted
right to vote such percentage of
the shares as may be necessary
to approve the merger of the
Purchaser and the Target (the
"Merger");
(j) neither the facilities nor the
making or borrowing of any
advance thereunder violates any
applicable provision of any
margin regulation of the Board
of Governors of the Federal
Reserve System (the "Board");
(k) the Board of Directors of Target
have approved the Merger and
have recommended the Tender
Offer to Target's shareholders,
there are no restrictions on the
ability of the Purchaser to
consummate the Merger and all
shareholder rights or poison
pill or similar right otherwise
available to Target shareholders
as a result of the consummation
of the Tender Offer or the
Merger (other than
6
<PAGE>
SUBJECT TO CONTRACT
3 May 1999
appraisal rights in respect of
the Merger under applicable law)
will have been eliminated;
(l) the terms of the Tender Offer
have not been altered in any
material respect without the
consent of the Arrangers;
(m) all of the material conditions
to the Tender Offer have been
fulfilled, or, with the prior
consent of the Arrangers, (such
consent not to be unreasonably
withheld) waived;
(n) the Target and the Purchaser
have entered into a merger
agreement in form, scope and
substance satisfactory to the
Arrangers (acting reasonably),
which merger agreement shall be
in full force and effect;
(o) all necessary governmental
approvals for the consummation
of the Tender Offer and the
Merger have been obtained and
all requisite filings have been
made under the Hart-Scott-Rodino
Antitrust Improvements Act of
1976 in respect of the Tender
Offer and Merger and the waiting
period thereunder has expired or
pre-clearance has been granted;
(p) except as otherwise agreed by
the Arrangers, all material
financial indebtedness of the
Target will be refinanced
simultaneously with the Merger.
Interest Periods The Borrower may select 1, 2, 3 or 6
months or such other periods as the
Agent may agree in each case falling on
7
<PAGE>
SUBJECT TO CONTRACT
3 May 1999
or prior to the Final Maturity Date.
During the syndication period, interest
Periods will be agreed with the
Arrangers.
Interest shall be paid at the end of
each Interest Period (or at 6 monthly
intervals if the Interest Period is
longer).
Representations: Geniaal will make representations, in
respect of itself, its subsidiaries and,
following purchase of a majority of
shares in Target, Target, and the
Borrower will make representations in
respect of itself, in each case usual
for a facility of this nature (subject
in each case to customary
qualifications, exceptions and
limitations, to be negotiated) including
(without limitation) as to capacity, due
incorporation, authorization and
execution, validity of documentation,
obtaining of all material consents and
similar matters, representations as to
legal matters connected with the
acquisition, absence of actual or
threatened litigation or environmental
liabilities, full disclosure of
information (including financial
information), accuracy of information
(including any Information Memorandum)
provided, no material adverse change in
Geniaal and its subsidiaries since last
audited information (being 31 December
1998) [Note: wording to be agreed - to
reflect ability to pay and to take into
account the acquisition of Target],
payment of taxes, no insolvency, no
material breach of any agreement or law,
no event of default or potential event
of default and in relation to due
diligence.
The representations will be repeated on
the date of each drawing.
8
<PAGE>
SUBJECT TO CONTRACT
3 May 1999
Covenants: Geniaal will, on behalf of itself and
its subsidiaries (including, without
limitation, following purchase of a
majority of shares in Target, Target),
and the Borrower will, in respect of
itself, give undertakings usual for a
facility of this nature, subject in each
case, to qualifications exceptions and
limitations to be agreed, including
(without limitation);
(a) Maintenance of existence and
business;
(b) Use of proceeds;
(c) Provision on a semi-annual and
annual basis (as applicable) of
financial and other information,
including information circulated
to shareholders and any other
information required by the
Lenders, acting reasonably,
subject, in all cases, to any
legal/stock exchange
restrictions;
(d) Limitations on changes in
accounting practices and
policies (other than in
accordance with Dutch GAAP
and/or IAS) -Arrangers may agree
to reasonable changes subject to
the provision of reconciliation
statements;
(e) Maintenance of insurance;
(f) Compliance with environmental
laws;
(g) Negative pledge (other than over
margin stock within the meaning
of Regulation U of the Board);
(h) Pari passu ranking;
(i) (i) No subsidiary
indebtedness (including,
without limitations.
9
<PAGE>
SUBJECT TO CONTRACT
3 May 1999
guarantees) in excess
of, in aggregate, a
threshold to be agreed;
(ii) No debt (excluding debt
available pursuant to
the Facility and a
limited threshold of
other debt to be agreed)
to be incurred by
Geniaal or any of its
subsidiaries (except
where such debt is
incurred for the
purposes of refinancing
the Facility);
(iii) Any indebtedness
incurred to refinance
all or any part of the
Facility shall have a
tenor which extends
beyond the Final
Maturity Date:
(i) Restriction on disposal of
assets (other than over margin
stock within the meaning of
Regulation U of the Board);
(j) No mergers and acquisitions
(other than as contemplated by
the Acquisition with other
exceptions to be agreed);
(k) Maintenance of property, books,
and records and subject, to any
legal/stock exchange
restrictions, permission for
periodic inspection thereof;
(l) Limits on loans and investments
(subject to exceptions and
thresholds to be agreed);
(m) Limits on transactions with
affiliates (subject to
exceptions and thresholds to
be agreed); and
(n) Until consummation of the
proposed Merger, no
amendment/waiver of any
10
<PAGE>
SUBJECT TO CONTRACT
3 May 1999
material provision of the
Merger Agreement.
Events of Default: The agreement will include events of
default usual for a facility of this
nature, but including grace periods and
notice requirements to be agreed, (as
applicable) and applying to Geniaal, its
subsidiaries and, following the
purchase of a majority of shares in
Target, Target as appropriate, including
(without limitation);
(a) Failure to pay any sum when due
or, in the case of technical
delay, within 3 business days of
the due date;
(b) Cross default in excess of NLG
[amount to be agreed],
(c) Misrepresentation;
(d) Breach of covenant;
(e) Insolvency and related events;
(f) Material adverse change; [Note:
wording re: Geniaal to be agreed
to relate to ability to pay.
Target wording to reflect merger
agreement]
(g) Adverse judgements in excess of
NLG [to be agreed]
11
<PAGE>
SUBJECT TO CONTRACT
3 May 1999
(h) Change of control or merger or
demerger of Geniaal (where
"change of control" means a
person or group of persons
acting together with a common
purpose becoming entitled to
exercise, directly or
indirectly, the majority of the
voting rights attaching to the
ordinary issued share capital of
Geniaal where such person or
group of persons was not
previously so entitled); and
(i) Until consummation of the
Merger, breach by Target of any
material provisions of the
Merger Agreement.
Taxes: All payments to be made by the Borrower
or the Guarantor will be free and clear
of all present and future taxes, unless
required by law. If any deduction is
required, the Borrower or, as the case
may be, the Guarantor will pay an
additional amount necessary to ensure
that the Lenders receive an amount that
would otherwise have been received had
no such deduction been required.
The agreement will contain customary
provisions for Lenders to mitigate and
customary tax credit provisions.
Indemnities: The agreement will contain provisions
commonly found in similar transactions
including (without limitation)
indemnities by Geniaal to Lenders for:
(a) Broken funding;
(b) Liabilities arising from the
Borrower's default;
(c) Increased costs; and
(d) Tax
12
<PAGE>
SUBJECT TO CONTRACT
3 May 1999
Illegality: The agreement will contain customary
provisions for prepayment and
cancellation in the event of supervening
illegality.
Transfers: The Lenders may transfer or assign their
commitments, in part or in whole, with
the consent of Geniaal (such consent not
to be unreasonably withheld or delayed)
Such consent will not be required for
transfers between the Arrangers or any
of their affiliates.
Governing Law: English.
Jurisdiction: English courts will have non-exclusive
jurisdiction.
Expenses: The following provision is binding on
the Borrower from the date hereof.
All legal and out-of-pocket expenses
properly incurred by the Arrangers in
connection with the negotiation,
preparation, execution and syndication
of the Facility Agreement will be for
the account of Geniaal.
Validity: This offer remains valid until close of
business (Amsterdam time) on 5 May,
1999, unless extended by the Arrangers.
Note: Appropriate US-Obligor specific language will be added if any US
subsidiary is to be included as a borrower.
13
<PAGE>
EXHIBIT (c)(1)
February 26, 1999
Getronics NV
Donauweg 10
P.O.Box 652
1000 Amsterdam
Netherlands
Attn: Mr. A.H.J. Risseuw, President and CEO
Gentlemen:
You and Wang Laboratories, Inc. (referred to herein as "Wang Global" or the
"Company") wish to enter into discussion regarding a possible business
transaction (the "Possible Transaction"). In connection with those discussions
you will be requesting certain non-public information from Wang Global and Wang
Global will be providing it to you. As a condition to Wang Global providing
information to you, you agree to treat any information concerning Wang Global
(whether prepared by the Company, its advisors or otherwise) (herein
collectively referred to as the "Evaluation Material") in accordance with the
provisions of this letter and to take or abstain from taking certain other
actions herein set forth.
1. In connection with the Proposed Transaction, Wang Global also may
request information concerning your business. As a condition to being provided
that information, Wang Global agrees to treat any information concerning your
business (whether prepared by you, your advisors or otherwise) (herein
collectively referred to as the "Your Evaluation Material") with the same
confidentiality and subject to the same restrictions as this letter requires you
to observe with respect to the information provided by Wang Global to you. The
definition of Your Evaluation Materials excludes the same categories of
information as are excluded below from the definition of Wang Global Evaluation
Materials, reversing in that regard, of course, the references to you and Wang
Global. You and Wang Global are referred to herein collectively as the
"Parties."
2. The term "Evaluation Material" does not include information which (i)
is already in your possession, provided that such information is not known by
you to be subject to another confidentiality agreement with or other obligation
of secrecy to Wang Global or another party, (ii) was, is or becomes generally
available to the public other than as a result of a disclosure by you or
<PAGE>
your directors, officers, employees agents or advisors (collectively
"Advisors"), (iii) was, is or becomes available to you on a non-confidential
basis from a source other than Wang Global or its directors, officers,
employees, agents or advisors, provided that such source is not known by you to
be bound by a confidentiality agreement with or other obligations of secrecy to
Wang Global or another Party or (iv) has been independently acquired or
developed by you or your Advisors based on information other than Evaluation
Material.
3. You hereby agree that the Evaluation Material will be used solely for
the purpose of evaluating the Possible Transaction, and that such information
will be kept confidential by you; provided, however, that (i) any of such
information may be disclosed to your Advisors who need to know such information
for the purpose only of evaluating the Possible Transaction (it being understood
that such Advisors shall be informed by you of the confidential nature of such
information and prior to the receipt of any Evaluation Materials shall have
agreed to treat such information confidentially in accordance with the terms
hereof), and (ii) any disclosure of such information may be made to which the
Company consents in writing. You shall be responsible for any actions or
omissions by your Advisors which if taken or not taken by you would be a breach
of this letter agreement (an "Advisor Breach"), provided that you will not be
responsible for any such Advisor Breach by any of your Advisors who expressly
agrees in writing to be bound by the terms of this letter agreements as if such
Advisor were an original Party hereto and with respect to which Advisor a signed
copy of such agreements to be bound has been provided to the Company.
4. You hereby acknowledge that you are aware, and that you will advise
such Advisors who are informed as to the matters which are the subject of this
letter, that the United States securities laws prohibit any person who has
received from an issuer material, non-public information concerning the matters
which are the subject of this letter from purchasing or selling securities of
such issuer or from communicating such information to any other person under
circumstances in which it is reasonably foreseeable that such person is likely
to purchase or sell such securities.
5. Except for the circumstances set forth in paragraph 6 below, you agree
that neither you nor your Advisors shall without the prior written consent of
the Company, disclose to any person either the fact that discussions or
negotiations are taking place concerning a Possible Transaction or any of the
terms, conditions or other facts with respect to any such Possible Transaction,
including the status thereof.
6. In the event that you or any of your Advisors are requested or
required, by oral questions, interrogatories, requests for information or
documents in legal proceedings, subpoena, civil investigative demand or other
similar process, or under applicable law or regulations, to dislcose any of the
Evaluation Material or the fact that the Evaluation Material has been made
available to you, that discussions or negotiations are taking place concerning
the Possible Transaction or any of the terms or conditions or other facts with
respect thereto, you shall provide the Company with prompt written notice of any
such request or requirement so that the Company may seek a protective order or
other appropriate remedy. If appropriate, the Company may waive compliance with
the provisions of this letter agreement. If, in the absence of a protective
order or other remedy or the receipt of a waiver from the Company, you or any of
your Advisors are nonetheless, based on the written opinion of your outside
legal counsel, legally compelled to disclose Evaluation Material or other
information to any tribunal or under applicable law or regulation or else stand
liable for contempt or suffer other material censure or penalty, you or your
Advisor may, without liability hereunder, disclose only that portion of the
Evaluation
<PAGE>
Material and such other information which your outside counsel advises you is
legally required to be disclosed, provided that you exercise your best efforts
to preserve the confidentiality of the Evaluation Material and such other
information being disclosed, including, without limitation, by cooperating with
the Company to obtain an appropriate protective order or other reliable
assurance that confidential treatment will be accorded by such tribunal to the
Evaluation Material and such other information being disclosed.
7. You hereby acknowledge and agree that the Evaluation Material is being
furnished to you in consideration of your agreements under this letter, that you
will not propose to the Company or any other person any transaction between you
and the Company and/or its security holders (with respect only to the securities
of the Company) or involving any of its securities or security holders (with
respect only to the securities of the Company) unless requested by the Board of
Directors of the Company to make such a proposal, and that you will not acquire,
or assist any other persons in acquiring, directly or indirectly, control of the
Company or any of the Company's securities, businesses or assets for a period of
one year following the termination of this letter, unless the Company shall have
consented in advance in writing to such acquisition.
8. Although the Parties will endeavor to include in the Wang Global
Evaluation Material and Your Evaluation Material, respectively, information that
each believes to be relevant for the purpose of considering the Possible
Transaction and responsive to the other Party's inquiries, the Parties
understand and agree that neither of them nor any of their respective advisors
have made or will be deemed to have made any representation or warranty as to
the accuracy or completeness of the Evaluation Material or Your Evaluation
Material, as the case may be. The Parties agree that neither of them nor their
respective Advisors shall have any liability to the other Party, or any of its
Advisors, relating to the Evaluation Materials or Your Evaluation Materials.
9. In consideration of the Parties making the information and some of
their key executives and employees available to each other to assist in the
analysis of the Possible Transaction, the Parties agree that for a period
beginning as of the date of this letter and ending two years after the
termination of this letter, the Parties shall not hire or solicit for
employment, directly or indirectly, any of each other's employees, including
employees of their respective subsidiaries, with whom you or your advisors, on
the one hand, or Wang Global and its advisors, on the other, have had contact
during the course of discussions and meetings related to the Possible
Transaction.
10. In the event that you do not proceed with the Possible Transaction
within a reasonable time and upon the request of the Company, you shall promptly
redeliver to the Company or destroy all written Evaluation Material and any
other written material containing or reflecting any information in the
Evaluation Material (whether prepared by the Company, its advisors or otherwise)
and will not retain any copies, extracts or other reproductions in whole or in
part of such written material. All documents, memoranda, notes and other
writings whatsoever prepared by you or your advisors based on the information in
the Evaluation Material ("Independently Developed Materials") shall be
destroyed, and upon request of the Company such destruction shall be certified
in writing to the Company by an authorized officer supervising the destruction,
provided, however, that your advisors may retain one copy of Independently
Developed Materials for archival purposes or as may be required by law or
regulatory authority, and such materials shall be maintained on a confidential
basis and shall not be otherwise copied or distributed.
<PAGE>
You agree that unless and until a definitive agreement between the Company
and you with respect to the Possible Transaction has been executed and
delivered, neither the Company nor you will be under any legal obligation of any
kind whatsoever with respect to such a transaction by virtue of this or any
written or oral expression with respect to such a transaction by any of its
directors, officers, employees, agents or any other representatives of its
advisors or representatives thereof except, in the case of this letter, for the
matters specifically agreed to herein. The agreement set forth in this
paragraph may be modified or waived only by a separate writing by the Company
and you expressly so modifying or waiving such agreement.
This letter shall be governed by, and construed in accordance with, the
laws of the State of New York. The Parties agree to submit to exclusive
jurisdiction with respect to any disputes arising in connection with this letter
to the courts of the State of New York. The Parties consent to the award of
injunctive relief to and specific performance enforce the terms of this letter,
in addition to any other remedy available at law or in equity and acknowledging
that monetary damages will not be a sufficient remedy. Except as otherwise
specifically set forth herein, this agreement and all obligations hereunder
shall terminate two years from the date hereof.
Very truly yours,
WANG LABORATORIES, INC.
By: /s/ Albert A. Notini
--------------------
Albert A. Notini, Sr. Vice President
Confirmed and Agreed to:
GETRONICS NV
By: /s/ Jan Docter, CFO
-------------------
Date: 1 March 1999
<PAGE>
EXHIBIT (c)(2)
EXECUTION COPY
- --------------------------------------------------------------------------------
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
GETRONICS NV,
GETRONICS ACQUISITION, INC.
AND
WANG LABORATORIES, INC.
Dated as of May 3, 1999
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
ARTICLE I
<S> <C>
DEFINITIONS.......................................................................................................1
Section 1.1 Definitions.................................................................................1
ARTICLE II
THE OFFER.........................................................................................................8
Section 2.1 The Offer...................................................................................8
Section 2.2 Company Actions.............................................................................9
Section 2.3 Composition of the Board of Directors......................................................11
ARTICLE III
THE MERGER.......................................................................................................12
Section 3.1 The Merger.................................................................................12
Section 3.2 Treatment of Capital Stock and Warrants....................................................13
Section 3.3 Dissenting Capital Stock...................................................................14
Section 3.4 Surrender of Certificates..................................................................15
Section 3.5 Payment....................................................................................15
Section 3.6 No Further Rights of Transfers.............................................................16
Section 3.7 Stock Option and Other Plans...............................................................16
Section 3.8 Certificate of Incorporation of the Surviving Corporation..................................18
Section 3.9 By-Laws of the Surviving Corporation.......................................................18
Section 3.10 Directors and Officers of the Surviving Corporation........................................18
Section 3.11 Closing....................................................................................18
Section 3.12 Withholding Rights.........................................................................18
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY....................................................................19
Section 4. Representations and Warranties of the Company...............................................19
Section 4.1 Due Organization, Good Standing and Corporate Power.........................................19
Section 4.2 Authorization and Validity of Agreement.....................................................19
Section 4.3 Capitalization..............................................................................19
Section 4.4 Consents and Approvals; No Violations.......................................................21
Section 4.5 Company Reports and Financial Statements....................................................21
</TABLE>
(i)
<PAGE>
<TABLE>
<S> <C> <C>
Section 4.6 Absence of Certain Changes
Section 4.7 Title to Properties; Encumbrances.........................................................22
Section 4.8 Compliance with Laws.......................................................................23
Section 4.9 Litigation.................................................................................23
Section 4.10 Employee Benefit Plans.....................................................................23
Section 4.11 Employment Relations and Agreements........................................................25
Section 4.12 Taxes......................................................................................26
(a) Tax Returns...............................................................................26
(b) Payment of Taxes..........................................................................26
(c) Other Tax Matters.........................................................................26
Section 4.13 Liabilities...............................................................................27
Section 4.14 Intellectual Property.....................................................................27
Section 4.15 Schedule 14D-1............................................................................28
Section 4.16 Broker's or Finder's Fee..................................................................28
Section 4.17 Environmental Laws and Regulations........................................................28
Section 4.18 State Takeover Statutes...................................................................29
Section 4.19 Voting Requirements.......................................................................30
Section 4.20 Rights Agreement..........................................................................30
Section 4.21 Year 2000.................................................................................30
Section 4.22 Series A and Series B Preferred Stock.....................................................30
Section 4.23 Common Stock Purchase Warrants and Microsoft Warrant......................................31
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT AND SUB.................................................................31
Section 5.1 Due Organization, Good Standing and Corporate Power........................................31
Section 5.2 Authorization and Validity of Agreement....................................................31
Section 5.3 Consents and Approvals; No Violations......................................................32
Section 5.4 Schedule 14D-9 and Proxy Statement.........................................................32
Section 5.5 Absence of Certain Changes.................................................................32
Section 5.6 Broker's or Finder's Fee...................................................................33
Section 5.7 Sub's Operations...........................................................................33
Section 5.8 Sufficient Funds...........................................................................33
ARTICLE VI
TRANSACTIONS PRIOR TO CLOSING DATE...............................................................................33
Section 6.1 Access to Information Concerning Properties and Records....................................33
Section 6.2 Confidentiality............................................................................34
Section 6.3 Conduct of the Business of the Company Pending the Closing Date............................34
Section 6.4 Company Stockholders'Meeting; Preparation of Proxy Statement; Short Form Merger............37
Section 6.5 Reasonable Best Efforts....................................................................38
Section 6.6 No Solicitation of Other Offers............................................................38
</TABLE>
(ii)
<PAGE>
<TABLE>
<S> <C> <C>
Section 6.7 Notification of Certain Matters............................................................40
Section 6.8 HSR Act....................................................................................40
Section 6.9 Exon-Florio................................................................................41
Section 6.10 Employee Benefits..........................................................................41
Section 6.11 Directors' and Officers' Insurance.........................................................42
Section 6.12 Rights Agreement...........................................................................44
Section 6.13 Public Announcements.......................................................................44
Section 6.14 Transfer Tax...............................................................................44
Section 6.15 U.S. Real Property Holding Corporation Status..............................................44
ARTICLE VII
CONDITIONS PRECEDENT TO OBLIGATIONS OF PARENT AND SUB............................................................45
Section 7.1 Conditions Precedent to Obligations of Parent and Sub......................................45
(a) Approval of Company's Stockholders.........................................................45
(b) Injunction.................................................................................45
(c) Statutes...................................................................................45
(d) Minimum Condition..........................................................................45
ARTICLE VIII
CONDITIONS PRECEDENT TO OBLIGATIONS OF THE COMPANY...............................................................45
Section 8.1 Conditions Precedent to Obligations of the Company.........................................45
(a) Approval of Company's Stockholders.........................................................45
(b) Injunction.................................................................................46
(c) Statutes...................................................................................46
(d) Minimum Condition..........................................................................46
ARTICLE IX
TERMINATION AND ABANDONMENT......................................................................................46
Section 9.1 Termination................................................................................46
Section 9.2 Effect of Termination......................................................................48
ARTICLE X
MISCELLANEOUS....................................................................................................48
Section 10.1 Fees and Expenses.........................................................................48
Section 10.2 Representations and Warranties............................................................49
Section 10.3 Extension; Waiver.........................................................................49
Section 10.4 Notices...................................................................................49
Section 10.5 Entire Agreement..........................................................................50
Section 10.6 Binding Effect; Benefit; Assignment.......................................................50
</TABLE>
(iii)
<PAGE>
<TABLE>
<S> <C> <C>
Section 10.7 Amendment and Modification................................................................51
Section 10.8 Further Actions...........................................................................51
</TABLE>
(iv)
<PAGE>
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of May 3, 1999 (this
"Agreement"), by and among GETRONICS NV, a company organized under the laws of
---------
The Netherlands ("Parent"), GETRONICS ACQUISITION, INC., a company organized
------
under the laws of Delaware and a direct wholly-owned subsidiary of Parent
("Sub"), and WANG LABORATORIES, INC., a company organized under the laws of
---
Delaware (the "Company").
-------
WHEREAS, each of the Supervisory Board and the Executive Board of
Parent and the respective Boards of Directors of Sub and the Company have
approved the acquisition of the Company indirectly by Parent through a
partnership to be formed to conduct business operations in the United States,
which partnership shall directly own Sub;
WHEREAS, in order to consummate such acquisition, each of the
Supervisory Board and the Executive Board of Parent and the respective Boards of
Directors of Sub and the Company have approved the merger of Sub with and into
the Company (the "Merger"), pursuant to and subject to the terms and conditions
------
of this Agreement;
WHEREAS, in contemplation of such acquisition, it is proposed that Sub
will make a tender offer (the "Offer") to purchase all of the issued and
-----
outstanding Offer Securities (as such term is defined in Section 1.1 hereof), in
each case subject to the terms and conditions of this Agreement, at the
Applicable Offer Prices (as such term is defined in Section 1.1 hereof); and
WHEREAS, the Board of Directors of the Company (i) has determined that
the Offer and the Merger are fair to, and in the best interest of, the holders
of Offer Securities and has declared that the Offer and the Merger are
advisable, (ii) has approved the Offer and the Merger and (iii) has recommended
that the holders of Offer Securities accept the Offer and tender the Offer
Securities pursuant to the Offer and that the stockholders of the Company
approve and adopt this Agreement;
NOW THEREFORE, in consideration of the premises and of the mutual
covenants, representations, warranties and agreements herein contained, the
parties hereto agree as follows:
ARTICLE I
DEFINITIONS
-----------
Section 1.1 Definitions. When used in this Agreement, the following
-----------
terms shall have the respective meanings specified therefor below (such meanings
to be equally applicable to both the singular and plural forms of the terms
defined).
"Acquisition Proposal" shall have the meaning set forth in Section
6.6(b).
<PAGE>
"Affiliate" of any Person shall mean any Person directly or indirectly
controlling, controlled by, or under common control with, such Person; provided
--------
that, for the purposes of this definition, "control" (including with correlative
- ----
meanings, the terms "controlled by" and "under common control with"), as used
with respect to any Person, shall mean the possession, directly or indirectly,
of the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities or partnership
interests, by contract or otherwise.
"Agreement" shall have the meaning set forth in the preamble hereto.
"Antitrust Authorities" shall mean the Federal Trade Commission, the
Antitrust Division, the attorneys general of the several states of the United
States, the Commission of the European Communities and any other governmental
authority having jurisdiction with respect to the transactions contemplated
hereby pursuant to applicable Antitrust Laws, provided that, for greater
-------- ----
certainty, "Antitrust Authorities" shall not include any Federal governmental
authority acting under authority related to control of foreign ownership,
control or influence or disclosure and control of classified information.
"Antitrust Law" shall mean the Sherman Act, as amended, the Clayton
Act, as amended, the HSR Act, the Federal Trade Commission Act, as amended, EU
Antitrust Laws and all other federal, state and foreign statutes, rules,
regulations, orders, decrees, administrative and judicial doctrines, and other
laws that are designed or intended to prohibit, restrict or regulate actions
having the purpose or effect of monopolization or restraint of trade.
"Alternative Proposal" shall have the meaning set forth in Section
9.1(f).
"Applicable Merger Consideration" shall mean, with respect to (i) each
share of Common Stock, the Common Stock Merger Consideration, (ii) each share of
Series B Preferred Stock, the Series B Preferred Stock Merger Consideration and
(iii) each Common Stock Purchase Warrant, the Common Stock Purchase Warrant
Merger Consideration.
"Applicable Offer Prices" shall mean, with respect to (i) each share
of Common Stock, the Common Stock Merger Consideration, (ii) each share of
Series A Preferred Stock, $1,271.73, (iii) each share of Series B Preferred
Stock, the Series B Preferred Stock Merger Consideration, (iv) each share of the
Series B Preferred Stock Depositary Shares, $55.05, (v) each Common Stock
Purchase Warrant, the Common Stock Purchase Warrant Merger Consideration and
(vi) the Microsoft Warrant, $6,250,000.
"Bankruptcy Court" shall have the meaning set forth in Section 4.3.
"Cash Payment" shall have the meaning set forth in Section 3.7.
"Certificate of Merger" shall have the meaning set forth in Section
3.1(a).
"Certificates" shall have the meaning set forth in Section 3.4(a).
"Claims" shall have the meaning set forth in Section 4.17.
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<PAGE>
"Closing" shall have the meaning set forth in Section 3.11.
"Closing Date" shall have the meaning set forth in Section 3.11.
"Code" shall mean the United States Internal Revenue Code of 1986, as
amended.
"Commission" shall mean the Securities and Exchange Commission.
"Commission Filings" shall have the meaning set forth in Section 4.5.
"Commitment Letter" shall have the meaning set forth in Section 5.8.
"Common Stock" shall mean shares of common stock, par value $0.01 per
share, of the Company (including the associated Rights (as such term is defined
below)).
"Common Stock Equivalents" shall mean such number of shares of Common
Stock of the Company represented by Offer Securities or Options which, in the
case of (i) one (1) share of Common Stock, is 1, (ii) one (1) share of Series A
Preferred Stock, is 43.478, (iii) one (1) share of Series B Preferred Stock, is
37.647, (iv) one (1) Series B Preferred Stock Depositary Share, is 1.882, (v)
one (1) Common Stock Purchase Warrant, is 1, (vi) the Microsoft Warrant, is
213,675, and (vii) each Option, is equal to the number of shares of Common Stock
issuable upon exercise of such Option.
"Common Stock Merger Consideration" shall have the meaning set forth
in Section 3.2(a).
"Common Stock Purchase Warrants" shall mean all of the warrants issued
by the Company pursuant to the Common Stock Purchase Warrant Agreement and
outstanding on the date hereof.
"Common Stock Purchase Warrant Agreement" shall mean the Warrant
Agreement, dated as of October 29, 1993, by and between the Company and American
Stock Transfer & Trust Company, as warrant agent.
"Common Stock Purchase Warrant Exercise Price" shall mean the
"Exercise Price", as such term is defined in the Common Stock Purchase Warrant
Agreement.
"Common Stock Warrant Merger Consideration" shall have the meaning set
forth in Section 3.2(c).
"Company" shall have the meaning set forth in the preamble hereto.
"Company Disclosure Letter" shall have the meaning set forth in
Section 4.
"Company Excluded Factors" shall mean: (a) any change, in and of
itself, in the market price or trading volume of the Offer Securities; (b) any
failure, in and of itself, by the Company to meet the revenue or earnings
predictions of equity analysts as reflected in the First Call consensus
estimate, or any other revenue or earnings predictions or expectations, for any
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<PAGE>
period ending (or for which earnings are released) on or after the date of this
Agreement and prior to the Effective Time; or (c)(i) employee attrition (other
than senior managers) and (ii) the loss of existing customers by Wang Government
Services, Inc. or the failure or delay by existing or prospective customers of
Wang Government Services, Inc. to purchase or enter into agreements to purchase
services or solutions from the Company or any of its Subsidiaries, in each case
arising out of, resulting from or attributable to (x) the announcement of this
Agreement and the transactions contemplated thereby or (y) Parent's announcement
or other communication of the plans or intentions of Parent with respect to the
conduct of any business of the Company or any of its Subsidiaries.
"Company Intellectual Property" shall have the meaning set forth in
Section 4.14(a).
"Company Property" shall have the meaning set forth in Section 4.17.
"Confidentiality Agreement" shall have the meaning set forth in
Section 6.2.
"Credit Facility" shall have the meaning set forth in Section 4.13.
"CSFB" shall mean Credit Suisse First Boston Corporation.
"Dissenting Stockholders" shall have the meaning set forth in Section
3.3.
"Effective Time" shall have the meaning set forth in Section 3.1(a).
"Employee Benefit Plans" shall have the meaning set forth in Section
4.10(a).
"Environmental Claims" shall have the meaning set forth in Section
4.17.
"Environmental Law" shall have the meaning set forth in Section 4.17.
"ERISA" shall have the meaning set forth in Section 4.10(a).
"EU Antitrust Laws" shall have the meaning set forth in Section 4.4.
"Excess Settlement Amounts" shall have the meaning set forth in
Section 6.3(b)(ix).
"Exchange Act" shall mean the Securities and Exchange Act of 1934, as
amended.
"Exon-Florio" shall mean the Defense Production Act of 1950, as
amended.
"GAAP" shall mean generally accepted accounting principles of the
United States of America, as in effect from time to time.
"Hazardous Materials" shall have the meaning set forth in Section
4.17.
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<PAGE>
"HSR Act" shall mean the Hart-Scott-Rodino Antitrust Improvements Act
of 1976, as amended.
"Indemnified Parties" shall have the meaning set forth in Section
6.11(a).
"Independent Director" shall have the meaning set forth in Section
2.3(a)
"Intercompany Convertible Instruments" shall mean any instrument held
pursuant to the Intercompany Convertible Instruments Agreement dated as of
October 29, 1993 by and between the Company and American Stock Transfer & Trust
Company.
"Letter of Transmittal" shall have the meaning set forth in Section
2.1(b).
"Material Adverse Effect", with respect to any Person, shall mean a
material adverse effect on the business, assets, liabilities, results of
operations or financial condition of such Person and its subsidiaries, taken as
a whole; provided that none of the Company Excluded Factors shall be deemed by
-------- ----
itself or themselves, either alone or in combination with one or more other
Company Excluded Factors, to constitute a Material Adverse Effect on the
Company.
"Material Systems" shall have the meaning set forth in Section 4.21.
"Merger" shall have the meaning set forth in the second recital
hereto.
"Microsoft" shall mean Microsoft Corporation, a company organized
under the laws of Washington.
"Microsoft Warrant" shall mean the warrant issued by the Company
pursuant to the Microsoft Warrant Agreement and outstanding as of the date
hereof.
"Microsoft Warrant Agreement" shall mean the Common Stock Purchase
Warrant Agreement, dated as of February 27, 1998, by and between the Company
and Microsoft.
"Microsoft Warrant Exercise Price" shall mean the "Exercise Price", as
such term is defined in the Microsoft Warrant Agreement.
"Minimum Condition" shall have the meaning set forth in Annex A.
"Multiemployer Plan" shall have the meaning set forth in Section
4.10(b).
"Offer" shall have the meaning set forth in the third recital hereto.
"Offer Documents" shall have the meaning set forth in Section 2.1(b).
"Offer Securities" shall mean the Common Stock, the Series A Preferred
Stock, the Series B Preferred Stock, the Series B Preferred Stock Depositary
Shares, the Common Stock Purchase Warrants and the Microsoft Warrant.
"Offer to Purchase" shall have the meaning set forth in Section
2.1(b).
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<PAGE>
"Olivetti" shall mean Ing. C. Olivetti & Co. S.p.A., a company
organized under the laws of Italy.
"Olivetti Warrant" shall mean the Olivetti Stock Appreciation Rights
dated March 17, 1998.
"Options" shall have the meaning set forth in Section 3.7.
"Parent" shall have the meaning set forth in the preamble hereto.
"Parent Disclosure Letter" shall have the meaning set forth in Section
5.
"Paying Agent" shall have the meaning set forth in Section 3.4(a).
"Payment Fund" shall have the meaning set forth in Section 3.5.
"Performance Material Adverse Effect," with respect to any Person,
shall mean a material adverse effect on the ability of such Person to perform
its obligations under this Agreement or to consummate the transactions
contemplated hereby.
"Permits" shall have the meaning set forth in Section 4.8(ii).
"Permitted Investments" shall have the meaning set forth in Section
3.5.
"Person" shall mean and include an individual, a partnership, a joint
venture, a corporation, a trust, an unincorporated organization, a group and a
government or other department or agency thereof.
"Plan" shall mean the Company's calendar year 1999 Plan in the form
provided to Parent prior to the date hereof.
"Proxy Statement" shall have the meaning set forth in Section 4.4.
"Release" shall have the meaning set forth in Section 4.17.
"Reorganization Plan" shall have the meaning set forth in Section 4.3
"Restricted Stock" shall mean those 606,500 shares of Common Stock
which were issued to certain employees and the outright, unencumbered ownership
of which is subject to the fulfillment of certain conditions.
"Returns" shall have the meaning set forth in Section 4.12(a).
"Rights" shall mean the Series C Junior Participating Preferred Stock
Purchase Rights issued under the Rights Agreement.
"Rights Agreement" shall mean the Rights Agreement, dated as of April
22, 1998, by and between the Company and the American Stock Transfer and Trust
Company.
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<PAGE>
"Schedule 14D-1" shall have the meaning set forth in Section 2.1(b).
"Schedule 14D-9" shall have the meaning set forth in Section 2.2(c).
"Securities Act" shall mean the Securities Act of 1933, as amended.
"Series A Preferred Stock" shall mean shares of 4- 1/2% Series A
Cumulative Convertible Preferred Stock, par value $0.01 per share, of the
Company.
"Series A Preferred Stock Conversion Price" shall mean the "Conversion
Price", as such term is defined in the Certificate of Designation of the Series
A Preferred Stock.
"Series B Preferred Stock Merger Consideration" shall have the meaning
set forth in Section 3.2(b).
"Series B Preferred Stock" shall mean shares of 6- 1/2% Series B
Cumulative Convertible Preferred Stock, par value $0.01 per share, of the
Company.
"Series B Preferred Stock Conversion Price" shall mean the "Conversion
Price", as such term is defined in the Certificate of Designation of the Series
B Preferred Stock.
"Series B Preferred Stock Depositary Shares" shall mean all of the
issued and outstanding depositary shares representing, in each case, 1/20th of a
share of Series B Preferred Stock.
"Series C Junior Participating Preferred Stock" shall mean shares of
Series C Junior Participating Preferred Stock, par value $0.01 per share, of the
Company.
"Stock Incentive Plans" shall have the meaning set forth in Section
3.7.
"Stock Plans" shall have the meaning set forth in Section 3.7.
"Stockholders' Meeting" shall have the meaning set forth in Section
6.4.
"Sub" shall have the meaning set forth in the preamble hereto.
"Subsidiary" with respect to the Company, shall mean and include (x)
any partnership of which the Company or any Subsidiary is a general partner or
(y) any other entity in which the Company or any of its Subsidiaries owns or has
the power to vote 50% or more of the equity interests in such entity having
general voting power to participate in the election of the governing body of
such entity.
"Superior Proposal" shall have the meaning set forth in Section
6.6(b).
"Surviving Corporation" shall have the meaning set forth in Section
3.1(b).
"Surviving Corporation Plans" shall have the meaning set forth in
Section 6.10(b).
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<PAGE>
"Taxes" shall have the meaning set forth in Section 4.12(a).
"Tender Offer Conditions" shall have the meaning set forth in Section
2.1.
"Termination Date" shall have the meaning set forth in Section 9.1(i).
"Transfer Taxes" shall have the meaning set forth in Section 6.14.
"WARN" shall mean the Federal Workers Adjustment Retraining and
Notification Act.
"Warrants" shall mean, collectively, the Common Stock Purchase
Warrants and the Microsoft Warrant.
"Year 2000 Compliance" shall have the meaning set forth in Section
4.21.
ARTICLE II
THE OFFER
---------
Section 2.1 The Offer. (a) Provided that this Agreement shall not
---------
have been terminated in accordance with Article IX hereof and so long as none of
the events set forth in Annex A hereto (the "Tender Offer Conditions") shall
-----------------------
have occurred and be existing, as promptly as practicable, but in no event later
than the fifth (5th) business day after the date of this Agreement, Parent and
Sub shall, and Parent shall cause Sub to, commence (within the meaning of Rule
14d-2 promulgated under the Exchange Act) the Offer at the Applicable Offer
Prices. The Applicable Offer Prices shall be net to the seller in cash. The
obligations of Sub to accept for payment and to pay for any Offer Securities
tendered shall be subject only to the Tender Offer Conditions, any of which may
be waived by Parent or Sub in their sole discretion; provided, however, that
-------- -------
neither Parent nor Sub shall waive the Minimum Condition without the prior
written consent of the Company. Neither Parent nor Sub shall, without the prior
written consent of the Company, (i) amend or waive the Minimum Condition, (ii)
reduce the number of Offer Securities to be purchased in the Offer, (iii) reduce
the Applicable Offer Prices, (iv) impose additional conditions to the Offer, (v)
change the form of consideration payable in the Offer or (vi) make any other
change to the terms of the Offer which is materially adverse to the holders of
the Offer Securities. Assuming prior satisfaction or waiver of the conditions
to the Offer, Sub shall, as soon as legally permissible after the commencement
thereof, accept for payment, in accordance with the terms of the Offer, the
Offer Securities which are validly tendered and not withdrawn on or prior to the
expiration of the Offer. If, on the expiration date of the Offer, less than 90%
of any of the Common Stock, the Series A Preferred Stock or the Series B
Preferred Stock have been validly tendered and not withdrawn, Sub may,
alternatively and without the consent of the Company, extend the Offer for up to
ten (10) days in the aggregate notwithstanding that all conditions to the Offer
have been satisfied, so long as Sub irrevocably waives the continued
satisfaction of any of the conditions to the Offer, other than (x) the Minimum
Condition; or (y) the condition contained in clause (v)(g) of Annex A, to the
extent this Agreement is terminated pursuant to Section 9.1(e). If, on the
initial scheduled expiration date of
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<PAGE>
the Offer, which shall be twenty (20) business days after the date the Offer is
commenced, all conditions to the Offer shall not have been satisfied or waived,
Sub may, from time to time, extend the expiration date of the Offer (any such
extension to be for ten (10) business days or less) up to the Termination Date;
provided, however, that Sub shall
- -------- -------
extend the expiration date of the Offer from time to time (any such extension to
be ten (10) business days or less) in the event that, on any scheduled
expiration date, (A) the only conditions to the Offer which have not been
satisfied are the Minimum Condition and the condition contained in clause (iii)
of Annex A and (B) Sub reasonably believes that the condition contained in
clause (iii) of Annex A will be satisfied within a reasonable period of time.
(b) The Offer shall be made by means of an offer to purchase (the
"Offer to Purchase") subject only to the Tender Offer Conditions. As soon as
- ------------------
reasonably practicable on the date the Offer is commenced, Parent and Sub shall
file, and Parent shall cause Sub to file, with the Commission a Tender Offer
Statement on Schedule 14D-1 (together with all amendments and supplements
thereto, the "Schedule 14D-1") with respect to the Offer. The Schedule 14D-1
--------------
shall contain (included as an exhibit) or shall incorporate by reference the
Offer to Purchase and a form of the related letter of transmittal (the "Letter
------
of Transmittal") and summary advertisement, as well as all other information and
- --------------
exhibits required by law (which Schedule 14D-1, Offer to Purchase, Letter of
Transmittal and such other information and exhibits, together with any
supplements or amendments thereto, are referred to herein collectively as the
"Offer Documents"). The Company and its counsel shall be given reasonable
- ----------------
opportunity to review and comment upon the Schedule l4D-1 prior to its filing
with the Commission. The Schedule 14D-1 will comply in all material respects
with the provisions of applicable federal securities laws and, on the date filed
with the Commission and the date first published, sent or given to the holders
of the Offer Securities, shall not contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary in order to make the statements therein, in light of the circumstances
under which they are made, not misleading, except that no representation is made
by Parent or Sub with respect to any information supplied by the Company in
writing for inclusion in the Schedule 14D-1. Each of the Company, on the one
hand, and Parent and Sub, on the other hand, agrees promptly to correct any
information provided by it for use in the Offer Documents if and to the extent
that the Offer Documents shall be, or have become, false or misleading in any
material respect, and Parent and Sub further agree to take all steps necessary
to cause the Schedule 14D-1 as so corrected to be filed with the Commission and
the other Offer Documents as so corrected to be disseminated to holders of the
Offer Securities, in each case as and to the extent required by applicable
federal securities laws. Each of Parent and Sub agrees to provide the Company
and its counsel with information with respect to any oral comments and copies of
any written comments Parent and Sub or their counsel may receive from the
Commission or its staff with respect to the Offer Documents promptly after the
receipt of such comments and shall provide the Company and its counsel an
opportunity to participate in the response of Parent or Sub to such comments,
including by participating with Parent and Sub or their counsel in any
discussions with the Commission or its staff.
Section 2.2 Company Actions. The Company hereby consents to the
---------------
Offer and the Merger and represents and warrants that:
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<PAGE>
(a) its Board of Directors (at a meeting duly called and held) has (i)
determined that each of the Offer and the Merger is fair to, and in the best
interest of, the holders of the Offer Securities and declared that the Offer and
the Merger are advisable, (ii) approved the Offer and the Merger and adopted
this Agreement in accordance with the provisions of the Delaware General
Corporation Law and (iii) recommended acceptance of the Offer and approval and
adoption of this Agreement by the stockholders of the Company; provided,
however, that prior to the purchase by Sub of the Offer Securities pursuant
- -------- -------
to the Offer and the Merger, the Company may withdraw or modify in a manner
adverse to Parent or Sub such recommendation, provided that the Company has
-------- ----
complied with its obligations pursuant to Section 6.6.
(b) CSFB has delivered to the Board of Directors of the Company its
opinion that the consideration to be received by the stockholders of the
Company, other than Parent and any direct or indirect subsidiary of Parent
(including Sub), pursuant to the Offer and the Merger is fair to such
stockholders from a financial point of view, subject to the assumptions and
qualifications contained in such opinion. The Company has provided to Parent a
true and correct copy of such fairness opinion.
(c) The Company shall file with the Commission, as soon as reasonably
practicable on the date of the commencement of the Offer, a
Solicitation/Recommendation Statement on Schedule 14D-9 (together with all
amendments and supplements thereto, the "Schedule l4D-9"), containing the
--------------
recommendations referred to in clause (a) of this Section 2.2 and shall
disseminate the Schedule 14D-9 as required by Rule 14d-9 under the Exchange Act.
Parent and Sub and their counsel shall be given reasonable opportunity to review
and comment upon the Schedule l4D-9 prior to its filing with the Commission.
The Schedule 14D-9 will comply in all material respects with the provisions of
applicable federal securities laws and, on the date filed with the Commission
and on the date first published, sent or given to the holders of Offer
Securities, shall not contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they are
made, not misleading, except that no representation is made by the Company with
respect to any information supplied by Parent or Sub in writing for inclusion in
the Schedule 14D-9. Each of the Company, on the one hand, and Parent and Sub,
on the other hand, agrees promptly to correct any information provided by it for
use in the Schedule 14D-9 if and to the extent that the Schedule 14D-9 shall be,
or have become false or misleading in any material respect; and the Company
further agrees to take all steps necessary to cause the Schedule 14D-9 as so
corrected to be filed with the Commission and to be disseminated to holders of
Offer Securities, in each case as and to the extent required by applicable
federal securities laws. The Company agrees to provide Parent and its counsel
with information with respect to any oral comments and copies of any written
comments the Company or its counsel may receive from the Commission or its staff
with respect to the Schedule 14D-9 promptly after the receipt of such comments
and shall provide Parent and its counsel an opportunity to participate in the
response of the Company to such comments, including by participating with the
Company and its counsel in any discussions with the Commission or its staff.
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<PAGE>
(d) In connection with the Offer, the Company shall promptly furnish
Sub with mailing labels, security position listings and any available listing or
computer list containing the names and addresses of the record holders of
Offered Securities as of the most recent practicable date and shall furnish Sub
with such additional information (including, but not limited to, updated lists
of holders of Offered Securities and their addresses, mailing labels and lists
of security positions) and such other assistance as Sub or its agents may
reasonably request in communicating the Offer to the holders of Offered
Securities. Subject to the requirements of applicable law, and except for such
steps as are necessary to disseminate the Offer Documents and any other
documents necessary to consummate the Merger, Parent and its Affiliates shall
hold in confidence the information contained in any such labels, listings and
files, will use such information only in connection with the Offer and the
Merger and, if this Agreement is terminated, shall deliver to the Company all
copies of such information in their possession.
Section 2.3 Composition of the Board of Directors. (a) Promptly
-------------------------------------
upon the acceptance for payment of, and payment by Sub for, Offer Securities
equal to at least a majority of the Common Stock Equivalents, Sub shall be
entitled to designate up to such number of directors on the Board of Directors
of the Company, rounded up to the next whole number, as will give Sub, subject
to compliance with Section 14(f) of the Exchange Act and Rule 14f-1 promulgated
thereunder, representation on the Board of Directors of the Company equal to at
least that number of directors which equals the product of the total number of
directors on the Board of Directors of the Company (giving effect to the
directors elected pursuant to this sentence) multiplied by a fraction, the
numerator of which shall be the number of Common Stock Equivalents represented
by Offer Securities beneficially owned by Sub and Parent and the denominator of
which shall be the number of Common Stock Equivalents represented by Offer
Securities then outstanding. Subject to applicable law, the Company shall take
all action requested by Parent which is reasonably 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 agrees to make such mailing
with the mailing of the Schedule 14D-9 so long as Sub shall have provided to the
Company on a timely basis all information required to be included in the
Information Statement with respect to Sub's designees. Parent and Sub shall be
solely responsible for any information with respect to either of them and their
nominees, officers, directors and Affiliates required by Section 14(f) and Rule
14f-1. In furtherance thereof, the Company shall increase the size of the Board
of Directors of the Company (subject to the limitations set forth in the
Company's Certificate of Incorporation and the Company's By-Laws), or use its
reasonable best efforts to secure the resignation of directors, or both, as is
reasonably necessary to permit Sub's designees to be elected to the Board of
Directors of the Company; provided, however, in the event that Sub's designees
-------- -------
are elected or appointed to the Board of Directors of the Company, until the
Effective Time, the Board of Directors of the Company shall have at least one
director who is a director on the date hereof and who is not an Affiliate or
associate of Parent or Sub or any other Person who beneficially owns Offer
Securities representing 5% or more of the Common Stock Equivalents, or is
designated by a majority of the directors of the Company who are such directors
(each, an "Independent Director"). At the Effective Time, the Company, upon the
--------------------
request of Parent or Sub, shall use its reasonable best efforts to cause Persons
designated by Sub to constitute the same percentage of each committee of its
Board of Directors, each Board of
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<PAGE>
Directors of each Subsidiary and each committee of each such Board of Directors
(in each case to the extent of the Company's ability to elect such Persons).
Promptly upon the exercise by Sub of any of the Warrants, the Company shall
issue the relevant number of shares of Common Stock to Sub, all in accordance
with the terms of the Common Stock Purchase Warrant Agreement or the Microsoft
Warrant Agreement, as the case may be.
(b) Following the election or appointment of Sub's designees pursuant
to this Section 2.3 and prior to the Effective Time, any amendment or
termination of this Agreement, the Company's Certificate of Incorporation or the
Company's By-Laws, any termination of this Agreement by the Company, any
extension by the Company of the time for the performance of any of the
obligations or other acts of Parent and Sub or waiver of any of the Company's
rights hereunder, and any other consent or action by the Board of Directors of
the Company hereunder, shall require the concurrence of a majority of the
Independent Directors. Notwithstanding anything in this Agreement to the
contrary, in the event that Parent's and Sub's designees constitute a majority
of the directors on the Board of Directors of the Company, the Independent
Directors shall be entitled, on behalf and at the expense of the Company, to
take any action under this Agreement or in connection with this Agreement and
the transactions contemplated hereby, including taking legal action regarding
the enforcement of the terms of this Agreement.
ARTICLE III
THE MERGER
----------
Section 3.1 The Merger. (a) Upon the terms and subject to the
----------
conditions of this Agreement, at the Closing (as such term is defined in Section
3.11), a certificate of merger (the "Certificate of Merger") shall be duly
---------------------
prepared, executed and acknowledged by Sub and the Company in accordance with
the Delaware General Corporation Law and shall be filed with the Secretary of
State of Delaware as provided in Section 251 of the Delaware General Corporation
Law. The Merger shall become effective upon the filing of the Certificate of
Merger (or at such later time reflected in such Certificate of Merger as shall
be agreed to by Parent and the Company). The date and time when the Merger
shall become effective is hereinafter referred to as the "Effective Time."
--------------
(b) At the Effective Time, Sub shall be merged with and into the
Company and the separate corporate existence of Sub shall cease, and the Company
shall continue as the surviving corporation under the laws of the State of
Delaware under the name of "Wang Global Corporation" (the "Surviving
---------
Corporation").
(c) From and after the Effective Time, the Merger shall have the
effects set forth in Section 259(a) of the Delaware General Corporation Law.
(d) If, at any time after the Effective Time, the Surviving
Corporation shall consider or be advised that any deeds, bills of sale,
assignments, assurances or any other actions or things are necessary or
desirable to continue in, vest, perfect or confirm of record or otherwise in the
Surviving Corporation's right, title or interest in, to or under any of the
rights, properties,
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<PAGE>
privileges, franchises or assets of either of its constituent corporations
acquired or to be acquired by the Surviving Corporation as a result of, or in
connection with, the Merger, or otherwise to effect the transactions
contemplated by this Agreement, the officers and directors of the Surviving
Corporation shall be authorized to execute and deliver, in the name and on
behalf of either of the constituent corporations of the Merger, all such deeds,
bills of sale, assignments and assurances and to take and do, in the name and on
behalf of each of such corporations or otherwise, all such other actions and
things as may be necessary or desirable to vest, perfect or confirm any and all
right, title and interest in, to and under such rights, properties, privileges,
franchises or assets in the Surviving Corporation or otherwise to carry out the
intent of this Agreement.
Section 3.2 Treatment of Capital Stock and Warrants. At the
---------------------------------------
Effective Time:
(a) Each share of Common Stock (including the associated Rights)
issued and outstanding immediately prior to the Effective Time (other than (i)
any shares of Common Stock which are held by any Subsidiary or in the treasury
of the Company, or which are held, directly or indirectly, by Parent or any
direct or indirect subsidiary of Parent (including Sub), all of which shall
cease to be outstanding and be canceled and retired and none of which shall
receive any payment with respect thereto and (ii) any shares of Common Stock
held by Dissenting Stockholders (as such term is defined in Section 3.3)) and
all rights in respect thereof shall, by virtue of the Merger and without any
action on the part of the holder thereof, forthwith cease to exist and be
converted into and represent the right to receive an amount in cash equal to
$29.25, without interest (the "Common Stock Merger Consideration").
---------------------------------
(b) Each share of Series B Preferred Stock issued and outstanding
immediately prior to the Effective Time (other than (i) any shares of Series B
Preferred Stock which are held by any Subsidiary or in the treasury of the
Company, or which are held, directly or indirectly, by Parent or any direct or
indirect subsidiary of Parent (including Sub), all of which shall cease to be
outstanding and be canceled and retired and none of which shall receive any
payment with respect thereto and (ii) any shares of Series B Preferred Stock
held by Dissenting Stockholders (as such term is defined in Section 3.3)) shall,
by virtue of the Merger and without any action on the part of the holders
thereof, no longer be convertible into shares of Common Stock but shall
thereafter be convertible, in accordance with Section 7(E) of the Certificate of
Designation of the Series B Preferred Stock, into the right to receive $1,101.17
(the "Series B Preferred Stock Merger Consideration").
---------------------------------------------
(c) Each Common Stock Purchase Warrant issued and outstanding
immediately prior to the Effective Time (other than any Common Stock Purchase
Warrants which are held by any Subsidiary or in the treasury of the Company, or
which are held, directly or indirectly, by Parent or any direct or indirect
subsidiary of Parent (including Sub), all of which shall cease to be outstanding
and be canceled and retired and none of which shall receive any payment with
respect thereto) and all rights in respect thereof shall, by virtue of the
Merger and without any action on the part of the holders thereof, no longer be
exercisable into the right to receive Common Stock but shall become exercisable,
in accordance with Section 11.5 of the Common Stock Purchase Warrant Agreement,
into the right to receive $7.80 (the "Common Stock Warrant Merger
---------------------------
Consideration").
-13-
<PAGE>
(d) Each share of Series A Preferred Stock issued and outstanding
immediately prior to the Effective Time and all rights in respect thereof shall,
immediately prior to the Merger and without any action on the part of the
holders thereof, be converted, in accordance with Section 5(a) of the
Certificate of Designation of the Series A Preferred Stock, into such number of
fully paid and nonassessable shares of Common Stock as is determined by dividing
$1,000 by 23, such shares of Common Stock thereafter to be treated in accordance
with Section 3.2(a).
(e) The Microsoft Warrant issued and outstanding immediately prior to
the Effective Time and all rights in respect thereof shall, by virtue of the
Merger and without any action on the part of the holder thereof, expire.
(f) The Olivetti Warrant and all rights in respect thereof shall, by
virtue of the Merger and without any action on the part of the holder thereof,
become exercisable for the kind and amount of shares of stock or other
securities or property which the holder would have been entitled to receive if,
immediately prior to the Effective Time, such holder had exercised the Olivetti
Warrant and the Company had elected to pay the amount due in Common Stock.
(g) Each share of common stock, par value $0.01 per share, of Sub then
issued and outstanding shall by virtue of the Merger and without any action on
the part of the holder thereof, become one fully paid and nonassessable share of
common stock, par value $0.01 per share, of the Surviving Corporation.
Section 3.3 Dissenting Capital Stock. Notwithstanding anything
------------------------
contained in this Agreement to the contrary but only to the extent required by
the Delaware General Corporation Law, shares of Common Stock, Series B Preferred
Stock or Series B Preferred Stock Depositary Shares that are issued and
outstanding immediately prior to the Effective Time and are held by holders who
comply with all the provisions of the law of the State of Delaware concerning
the right of holders of Common Stock, Series B Preferred Stock or Series B
Preferred Stock Depositary Shares, as the case may be, to dissent from the
Merger and require appraisal of their shares of Common Stock, Series B Preferred
Stock or Series B Preferred Stock Depositary Shares, as the case may be (such
holders, "Dissenting Stockholders"), shall not be converted into the right to
-----------------------
receive the Applicable Merger Consideration but shall become the right to
receive such consideration as may be determined to be due such Dissenting
Stockholder pursuant to the law of the State of Delaware; provided, however,
-------- -------
that if any Dissenting Stockholder who demands appraisal of such holder's shares
under the Delaware General Corporation Law shall effectively withdraw or lose
(through failure to perfect or otherwise) his or her right to appraisal, then as
of the Effective Time or the occurrence of such event, whichever occurs later,
such holder's shares shall thereupon be deemed to have been converted as of the
Effective Time into the right to receive the Applicable Merger Consideration,
without any interest thereon, and such holder shall no longer be a Dissenting
Stockholder. The Company shall give Parent and Sub (x) notice of any written
demands for appraisal, withdrawals of demands for appraisal and any other
related instruments received by the Company, and (y) the opportunity to direct
all negotiations and proceedings with respect to demands for appraisal. The
Company shall not voluntarily make any payment with respect to any demands for
appraisal and shall not, except with the prior written consent of Parent, settle
or offer to settle any demand.
-14-
<PAGE>
Section 3.4 Surrender of Certificates. (a) Prior to the Effective
-------------------------
Time, Parent shall designate a bank or trust company located in the United
States to act as paying agent (the "Paying Agent") for the holders of shares of
------------
Common Stock, Series B Preferred Stock, Series B Preferred Stock Depositary
Shares and Common Stock Purchase Warrants in connection with the Merger to
receive in trust funds to make the payments contemplated by Section 3.2. At the
Effective Time, Parent shall cause the Paying Agent to mail and/or make
available to each holder of a certificate theretofore evidencing shares of
Common Stock, Series B Preferred Stock, Series B Preferred Stock Depositary
Shares and Common Stock Purchase Warrants (other than those which are held by
any Subsidiary or in the treasury of the Company or which are held directly or
indirectly by Parent or any direct or indirect subsidiary of Parent (including
Sub)) a notice and letter of transmittal advising such holder of the
effectiveness of the Merger and the procedure for surrendering to the Paying
Agent such certificate or certificates which immediately prior to the Effective
Time represented outstanding Common Stock, Series B Preferred Stock, Series B
Preferred Stock Depositary Shares and Common Stock Purchase Warrants (the
"Certificates") in exchange for the Applicable Merger Consideration deliverable
- -------------
in respect thereof pursuant to this Article III. Upon the surrender for
cancellation to the Paying Agent of such Certificates, together with a letter of
transmittal, duly executed and completed in accordance with the instructions
thereon, and any other items specified by the letter of transmittal, the Paying
Agent shall promptly pay to the Person entitled thereto the Applicable Merger
Consideration deliverable in respect thereof. Until so surrendered, each
Certificate shall be deemed, for all corporate purposes, to evidence only the
right to receive upon such surrender the Applicable Merger Consideration
deliverable in respect thereof to which such Person is entitled pursuant to this
Article III. No interest shall be paid or accrued in respect of such cash
payments.
(b) If the Applicable Merger Consideration (or any portion thereof) is
to be delivered to a Person other than the Person in whose name the Certificates
surrendered in exchange therefor are registered, it shall be a condition to the
payment of the Applicable Merger Consideration that the Certificates so
surrendered shall be properly endorsed or accompanied by appropriate stock
powers and otherwise in proper form for transfer, that such transfer otherwise
be proper and that the Person requesting such transfer pay to the Paying Agent
any transfer or other taxes payable by reason of the foregoing or establish to
the satisfaction of the Paying Agent that such taxes have been paid or are not
required to be paid.
(c) In the event any Certificate shall have been lost, stolen or
destroyed, upon the making of an affidavit of that fact by the Person claiming
such Certificate to be lost, stolen or destroyed, the Paying Agent will issue in
exchange for such lost, stolen or destroyed Certificate the Applicable Merger
Consideration deliverable in respect thereof as determined in accordance with
this Article III; provided, that the Person to whom the Applicable Merger
-------- ----
Consideration is paid shall, as a condition precedent to the payment thereof,
give the Surviving Corporation a bond in such sum as it may direct or otherwise
indemnify the Surviving Corporation in a manner satisfactory to it against any
claim that may be made against the Surviving Corporation with respect to the
Certificate claimed to have been lost, stolen or destroyed.
Section 3.5 Payment. Concurrently with or immediately prior to the
-------
Effective Time, Sub shall deposit in trust with the Paying Agent cash in United
States dollars in an aggregate amount equal to the product of (i) the number of
shares of Common Stock, Series B
-15-
<PAGE>
Preferred Stock, Series B Preferred Stock Depositary Shares and Common Stock
Purchase Warrants outstanding immediately prior to the Effective Time (other
than shares of Common Stock, Series B Preferred Stock, Series B Preferred Stock
Depositary Shares or Common Stock Purchase Warrants which are held by any
Subsidiary or in the treasury of the Company or which are held directly or
indirectly by Parent or any direct or indirect subsidiary of Parent (including
Sub) or a Person known at the time of such deposit to be a Dissenting
Stockholder) and (ii) the Applicable Merger Consideration (such amount being
hereinafter referred to as the "Payment Fund").
-------------
The Payment Fund shall be invested by the Paying Agent as directed by Sub in
direct obligations of the United States, obligations for which the full faith
and credit of the United States is pledged to provide for the payment of
principal and interest, commercial paper of an issuer organized under the laws
of a state of the United States rated of the highest quality by Moody's
Investors Services, Inc. or Standard & Poor's Ratings Group or certificates of
deposit, bank repurchase agreements or bankers' acceptances of a United States
commercial bank having at least $1,000,000,000 in assets (collectively,
"Permitted Investments") or in money market funds which are invested in
- ----------------------
Permitted Investments, and any net earnings with respect thereto shall be paid
to Sub as and when requested by Sub. The Paying Agent shall, pursuant to
irrevocable instructions, make the payments referred to in Section 3.2(a) hereof
out of the Payment Fund. The Payment Fund shall not be used for any other
purpose. Promptly following the date which is one hundred and eighty (180) days
after the Effective Time, the Paying Agent shall return to the Surviving
Corporation all cash, certificates and other instruments in its possession that
constitute any portion of the Payment Fund, and the Paying Agent's duties shall
terminate. Thereafter, each holder of a Certificate may surrender such
Certificate to the Surviving Corporation and (subject to applicable abandoned
property, escheat and similar laws) receive in exchange therefor the Applicable
Merger Consideration, without interest, but shall have no greater rights against
the Surviving Corporation than may be accorded to general creditors of the
Surviving Corporation under applicable law. Notwithstanding the foregoing,
neither the Paying Agent nor any party hereto shall be liable to any stockholder
for any Applicable Merger Consideration delivered to a public official pursuant
to applicable abandoned property, escheat and similar laws.
Section 3.6 No Further Rights of Transfers. At and after the
------------------------------
Effective Time, each holder of capital stock of the Company (other than holders
of Series B Preferred Stock) shall cease to have any rights as a stockholder of
the Company, except for, in the case of a holder of a Certificate (other than
shares of capital stock of the Company to be canceled pursuant to Section 3.2
hereof or held by Dissenting Stockholders), the right to surrender his or her
Certificate in exchange for payment of the Applicable Merger Consideration or,
in the case of a Dissenting Stockholder, to perfect his or her right to receive
payment for his or her shares pursuant to the laws of the State of Delaware if
such holder has validly perfected and not withdrawn or otherwise lost his or her
right to receive payment for his or her shares, and no transfer of shares of
capital stock of the Company (other than shares of Series B Preferred Stock)
shall be made on the stock transfer books of the Surviving Corporation.
Certificates presented to the Surviving Corporation after the Effective Time
shall be canceled and exchanged for cash as provided in this Article III. At
the close of business on the day of the Effective Time the stock ledger of the
Company with respect to capital stock of the Company shall be closed.
Section 3.7 Stock Option and Other Plans. Prior to the Effective
----------------------------
Time, the Board of Directors of the Company (or, if appropriate, any committee
thereof) shall take all actions and
-16-
<PAGE>
shall use its reasonable best efforts to obtain all necessary consents and
releases from all of the holders of all the outstanding stock options and other
rights to purchase Common Stock (the "Options") heretofore granted under any
--------
compensatory stock option plan of the Company or otherwise (the "Stock Plans"),
-----------
to (i) provide for the cancellation, effective at the Effective Time, subject to
the payment provided for in the next sentence being made, of all Options, (ii)
terminate, as of the Effective Time, the Stock Plans and any other plan, program
or arrangement providing for the issuance or grant of any other interest in
respect of the capital stock of the Company or any of its Subsidiaries
(collectively with the Stock Plans, referred to as the "Stock Incentive Plans")
---------------------and
(iii) amend, as of the Effective Time, the provisions of any other Employee
Benefit Plan providing for the issuance, transfer or grant of any capital stock
of the Company or any such Subsidiary, or any interest in respect of any capital
stock of the Company or any such Subsidiary, to provide no continuing rights to
acquire, hold, transfer or grant any capital stock of the Company or any such
Subsidiary or any interest in the capital stock of the Company or any such
Subsidiary. Stock Plans shall not include any Intercompany Convertible
Instruments and Options shall not include any options granted under any
Intercompany Convertible Instrument. Immediately prior to the Effective Time,
each Option, whether or not then vested or exercisable, shall no longer be
exercisable for the purchase of shares of Common Stock but shall entitle each
holder thereof, in cancellation and settlement therefor, to payments by the
Company in cash (the "Cash Payment"), at the Effective Time, equal to the
------------
product of (x) the total number of shares of Common Stock subject to such
Option, whether or not then vested or exercisable, and (y) the amount by which
the Applicable Merger Consideration for shares of Common Stock exceeds the
exercise price per share of Common Stock subject to such Option, each such Cash
Payment to be paid to each holder of an outstanding Option at the Effective
Time. The Company shall deliver to Parent within five business days of the date
hereof a true and complete list of the Options which are outstanding as of the
date hereof, together with detailed calculations of the Cash Payments relating
to such Options had the Effective Time occurred on the date of delivery thereof.
The Company shall update such list and such calculations as of, and deliver such
update to Parent on, the date that is two (2) business days prior to the
Effective Time, such updated list and calculations made as if the Effective Time
would occur on such date. Except as otherwise contemplated herein, any then
outstanding stock appreciation rights or limited stock appreciation rights
issued by the Company or any Subsidiary of the Company shall be canceled
immediately prior to the Effective Time without any payment therefor. The
Company shall use its reasonable best efforts to ensure that neither it nor any
of its Subsidiaries is or will be bound by any Options, other options, warrants,
rights or agreements which would entitle any Person, other than Parent or its
Affiliates, to own any capital stock of the Company or any of its Subsidiaries
or to receive any payment in respect thereof. Notwithstanding any other
provision of this Section 3.7, the Company shall not be required to purchase any
minority equity interests in any of its Subsidiaries. Notwithstanding any other
provision of this Section 3.7 to the contrary, payment of the Cash Payment may
be withheld with respect to any Option until necessary consents and releases are
obtained. The Company shall take all steps as may be required to provide that
with respect to each individual who is a director or officer of the Company
immediately prior to the Effective Time all transactions contemplated by this
Agreement with respect to stock held by such Person shall be exempt under the
Exchange Act in accordance with the terms and conditions set forth in that
certain No-Action Letter, dated January 12, 1999, issued by the Securities and
Exchange
-17-
<PAGE>
Commission to Skadden, Arps, Slate, Meagher & Flom LLP. Immediately prior to the
Merger, the Company shall cause any restrictions imposed on the Restricted Stock
to be lifted.
Section 3.8 Certificate of Incorporation of the Surviving
---------------------------------------------
Corporation. The Certificate of Incorporation of the Company, as amended, as in
effect immediately prior to the Effective Time, shall be the Certificate of
Incorporation of the Surviving Corporation and shall be amended following the
Merger so that Article 4 thereof reads in its entirety as follows: "The total
number of shares of Common Stock which the Corporation has authority to issue is
1,000 shares of Common Stock, par value one cent ($0.01) per share."
Section 3.9 By-Laws of the Surviving Corporation. The By-Laws of the
------------------------------------
Company, as in effect immediately prior to the Effective Time, shall be the By-
Laws of the Surviving Corporation.
Section 3.10 Directors and Officers of the Surviving Corporation. At
---------------------------------------------------
the Effective Time, the directors of Sub immediately prior to the Effective Time
shall be the directors of the Surviving Corporation, each of such directors to
hold office, subject to the applicable provisions of the Certificate of
Incorporation and By-Laws of the Surviving Corporation, until the next annual
stockholders' meeting of the Surviving Corporation and until their respective
successors shall be duly elected or appointed and qualified. At the Effective
Time, the officers of the Company immediately prior to the Effective Time shall,
subject to the applicable provisions of the Certificate of Incorporation and By-
Laws of the Surviving Corporation, be the officers of the Surviving Corporation
until their respective successors shall be duly elected or appointed and
qualified.
Section 3.11 Closing. The Merger (the "Closing") shall take place at
------- -------
10:00 A.M. at the offices of White & Case LLP, 1155 Avenue of the Americas, New
York, New York 10036 as soon as practicable, but in any event within three (3)
business days after the last of the conditions set forth in Articles VII and
VIII hereof is satisfied or waived or at such other date or place as the parties
hereto shall agree in writing. Such date is herein referred to as the "Closing
-------
Date".
- ----
Section 3.12 Withholding Rights. Parent shall be entitled to deduct
------------------
and withhold, or cause to be deducted or withheld, from the consideration
otherwise payable pursuant to this Agreement to any holder of Offer Securities
or Options such amounts as are required to be deducted and withheld with respect
to the making of such payment under the Code, or any provision of applicable
state, local or foreign Tax law. To the extent that amounts are so deducted and
withheld, such deducted and withheld amounts shall be treated for all purposes
of this Agreement as having been paid to such holders in respect of which such
deduction and withholding was made.
-18-
<PAGE>
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
---------------------------------------------
Section 4. Representations and Warranties of the Company. The
---------------------------------------------
Company hereby represents and warrants to Parent and Sub that, except in
connection with the transactions contemplated hereby or as disclosed in the
Company's disclosure letter (the "Company Disclosure Letter") delivered
-------------------------
concurrently with the delivery of this Agreement:
Section 4.1 Due Organization, Good Standing and Corporate Power.
---------------------------------------------------
Each of the Company and its Subsidiaries is a corporation duly organized,
validly existing and in good standing under the laws of the jurisdiction of its
incorporation, and each such Person has all requisite corporate power and
authority to own, lease and operate its properties and to carry on its business
as now being conducted. The Company and each of its Subsidiaries is duly
qualified or licensed to do business and is in good standing in each
jurisdiction in which the property owned, leased or operated by it or the nature
of the business conducted by it makes such qualification necessary, except in
such jurisdictions where the failure to be so qualified or licensed and in good
standing could not reasonably be expected to have a Material Adverse Effect on
the Company. The Company has, prior to the date of this Agreement, made
available to Parent complete and correct copies of the Company's Certificate of
Incorporation, as amended, and the Company's By-Laws.
Section 4.2 Authorization and Validity of Agreement. The Company has
---------------------------------------
the requisite power and authority to execute and deliver this Agreement, to
perform its obligations hereunder and (subject to, if required by the Delaware
General Corporation Law, the approval of the stockholders of the Company) to
consummate the transactions contemplated hereby. The execution, delivery and
performance of this Agreement by the Company, and the consummation by it of the
transactions contemplated hereby, have been duly authorized and approved by its
Board of Directors, and no other corporate action on the part of the Company is
necessary to authorize the execution, delivery and performance of this Agreement
by the Company and the consummation of the transactions contemplated hereby
(other than, if required by the Delaware General Corporation Law, the approval
of this Agreement by the stockholders of the Company and the filing of
appropriate merger documents as required by the Delaware General Corporation
Law). This Agreement has been duly executed and delivered by the Company and,
assuming that this Agreement is a valid and binding obligation of Parent and Sub
enforceable against Parent and Sub, is a valid and binding obligation of the
Company enforceable against the Company in accordance with its terms, except
that such enforcement may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium or other similar laws affecting the enforcement of
creditors' rights generally, and general equitable principles.
Section 4.3 Capitalization. As of the date of this Agreement, the
--------------
authorized capital stock of the Company consists of (a) 5,000,000 shares of
preferred stock, $.01 par value per share, of which 90,000 shares have been
designated as Series A Preferred Stock and are issued and outstanding, 143,750
shares have been designated as Series B Preferred Stock and are issued and
outstanding and 100,000 shares have been designated as Series C Junior
Participating Preferred Stock, none of which are issued and outstanding and (b)
100,000,000 shares of
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<PAGE>
Common Stock, of which 46,696,565 shares are issued and outstanding (6,000 of
which remain in a disputed claims reserve established pursuant to (i) the
reorganization plan of the Company pursuant to Chapter 11 of the United States
Bankruptcy Code that was approved by the United States Bankruptcy Court for the
----------------
District of Massachusetts (the "Bankruptcy Court") on September 20, 1993, (ii)
the disclosure statement used to solicit consents to such reorganization plan
and (iii) the signed confirmation order with respect to such reorganization plan
(the documents referred to in clauses (i), (ii) and (iii) being referred to
hereinafter collectively as the "Reorganization Plan")). All issued and
-------------------
outstanding shares of Common Stock, Series A Preferred Stock and Series B
Preferred Stock are duly authorized, validly issued, fully paid, nonassessable
and free of preemptive rights. There is no outstanding subscription, option,
warrant, call, right, agreement, commitment, understanding or arrangement
relating to the issuance, sale, delivery, transfer or redemption of Common
Stock, Series A Preferred Stock, Series B Preferred Stock or any other shares of
capital stock of the Company (including any right of conversion or exchange
under any outstanding security or other instrument) other than, in the case of
Common Stock, in each case as of January 31, 1999, (i) shares of Common Stock
which may be issued to wholly-owned Subsidiaries of the Company upon the
conversion of intercompany convertible instruments issued pursuant to the
Reorganization Plan (none of which has been converted and all of which are
redeemable by payment by the Company of an amount not exceeding $50,000,000),
(ii) up to 7,209,059 shares which may be issued upon exercise of Common Stock
Purchase Warrants issued or issuable to former stockholders of the Company
pursuant to the Reorganization Plan, (iii) up to 9,324,807 shares of Common
Stock which may be issued upon the conversion of the Series A Preferred Stock
and Series B Preferred Stock, (iv) up to 213,675 shares of Common Stock which
may be issued upon exercise of the Microsoft Warrants, (v) shares of Common
Stock which may be issued upon the exercise of the Olivetti Warrant, (vi)
1,500,000 shares of Common Stock which may be issued pursuant to an Ancillary
Consideration Agreement, dated March 17, 1998, by and between the Company and
Olivetti , (vii) up to 13,402,500 shares of Common Stock which may be issued to
employees of the Company pursuant to the Company's 1993 Stock Incentive Plan,
1994 Employees' Stock Incentive Plan, 1995 Employees' Stock Purchase Plan, Olsy
Employee Stock Incentive Plan, the I-Net Rollover Stock Option Plan, the Parian
Rollover Stock Option Plan, the Van Dyke Rollover Stock Option Plan and the non-
plan options, and (viii) up to 240,000 shares of Common Stock issuable upon the
exercise of stock options, granted to the directors of the Company pursuant to
the Company's 1993 and 1995 Directors' Stock Option Plans. Neither the Company
nor any of its Subsidiaries has authorized or issued and outstanding any bonds,
debentures, notes or other indebtedness the holders of which have the right to
vote (or to convert or exchange such bonds, debentures, notes or other
indebtedness into or exercisable for securities the holders of which have the
right to vote) with the stockholders of such Person on any matter, except for
any such bonds, debentures, notes or other indebtedness the existence of which
does not have, or could not reasonably be expected to have, a Material Adverse
Effect. No shares of the capital stock of the Company are held in its treasury.
All issued and outstanding shares of capital stock of the Company and each of
its Subsidiaries have been duly authorized and validly issued and are fully paid
and nonassessable and none of them is subject to, nor was issued in violation
of, any preemptive rights, except where, in the case of any Subsidiary, the
failure to be so authorized, issued, paid, nonassessable or issued does not
have, or could not reasonably be expected to have, a Material Adverse Effect.
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<PAGE>
Section 4.4 Consents and Approvals; No Violations. Assuming (i) the
-------------------------------------
filings required under the HSR Act are made and the waiting period thereunder
has been terminated or has expired, (ii) voluntary notification under Section
721 of Exon-Florio is made, (iii) the prior notification and reporting
requirements of the European Community pursuant to Council Regulation 4064/89,
as amended (the "EU Antitrust Laws") as well as any antitrust
-----------------
filings/notifications which must or may be effected at the national level in
countries having jurisdiction are complied with or made, (iv) the requirements
of the Exchange Act relating to the proxy statement or information statement
required in connection with the Stockholders' Meeting (the "Proxy Statement"),
---------------
if any, and the Offer are met, (v) the filing of the Certificate of Merger and
other appropriate merger documents, if any, as required by the Delaware General
Corporation Law, are made, (vi) such actions as are necessary in order to comply
with the Industrial Security Regulations of the U.S. Department of Defense and
(vii) approval of the Merger and this Agreement by the stockholders of the
Company, if required by the Delaware General Corporation Law, is received, the
execution and delivery of this Agreement by the Company and the consummation by
the Company of the transactions contemplated hereby will not: (A) violate or
conflict with any provision of the Company's Certificate of Incorporation or the
Company's By-Laws; (B) violate or conflict with any statute, ordinance, rule,
regulation, order or decree of any court or of any governmental or regulatory
body, agency or authority applicable to the Company or any of its Subsidiaries
or by which any of their respective properties or assets may be bound, except
for such violations or conflicts which are not "material", as such term is
commonly understood in connection with a Person's disclosure obligations under
the Securities Act or the Exchange Act, (C) require any filing by the Company or
any of its Subsidiaries with, or the obtaining by the Company or any of its
Subsidiaries of any permit, consent or approval of, or the giving of any notice
by the Company or any of its Subsidiaries to, any governmental or regulatory
body, agency or authority, except for such filings, permits, consents or
approvals which are not "material", as such term is commonly understood in
connection with a Person's disclosure obligations under the Securities Act or
the Exchange Act; or (D) result in a violation or breach of, conflict with,
constitute (with or without due notice or lapse of time or both) a default (or
give rise to any right of termination, cancellation, payment or acceleration)
under, or result in the creation of any lien, security interest, charge or
encumbrance upon any of the properties or assets of the Company or any of its
Subsidiaries under, or give rise to any obligation, right of termination,
cancellation, acceleration or increase of any obligation or a loss of a material
benefit under, any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, license, franchise, permit, agreement, contract, lease,
franchise agreement or other instrument or obligation to which the Company or
any of its Subsidiaries is a party, or by which any such Person or any of its
properties or assets are bound, except for such violations, breaches or
conflicts which are not "material", as such term is commonly understood in
connection with a Person's disclosure obligations under the Securities Act or
the Exchange Act.
Section 4.5 Company Reports and Financial Statements. Since June 30,
----------------------------------------
1997, the Company and its Subsidiaries have filed all forms, reports, schedules,
statements, registration statements and documents with the Commission required
to be filed by it pursuant to the federal securities laws and the Commission
rules and regulations thereunder, and all forms, reports, schedules, statements,
registration statements and other documents filed with the Commission by the
Company and its Subsidiaries have complied in all material respects with all
applicable
-21-
<PAGE>
requirements of the Securities Act or the Exchange Act, as the case may be, and
the Commission rules and regulations promulgated thereunder. The Company has,
prior to the date of this Agreement, made available to Parent true and complete
copies of all forms, reports, schedules, statements, registration statements and
other filings filed by the Company and its Subsidiaries with the Commission
since June 30, 1997 (such forms, reports, schedules, statements, registration
statements and other filings, together with any exhibits, any amendments thereto
and information incorporated by reference therein, are sometimes collectively
referred to as the "Commission Filings"). As of their respective dates or, if
------------------
amended, as of the date of the last such amendment prior to the date hereof, the
Commission Filings did not contain any untrue statement of a material fact or
omit to state a material fact required to be stated therein or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading. Each of the consolidated balance sheets of the Company and
its consolidated Subsidiaries as of the end of the fiscal years ended June 30,
1998 and June 30, 1997 and as of the six month period ended December 31, 1998
and the consolidated statements of operations, consolidated statements of
stockholders' equity and consolidated statements of cash flows of the Company
and its consolidated Subsidiaries for the fiscal years ended June 30, 1998 and
June 30, 1997 and for the six month period ended December 31, 1998 contained in
the Commission Filings were prepared in accordance with GAAP applied on a
consistent basis (except as may be indicated therein or in the notes or
schedules thereto) and present fairly, in all material respects, the
consolidated financial position of the Company and its consolidated Subsidiaries
as of the dates thereof and the consolidated results of their operations and
changes in cash flows for the periods then ended. The Company has heretofore
made available to Parent true and correct copies of any amendments or
modifications to any Commission Filings which have not yet been filed with the
Commission but that are required to be filed with the Commission in accordance
with the Securities Act or the Exchange Act, as the case may be, and the
Commission rules and regulations promulgated thereunder.
Section 4.6 Absence of Certain Changes. Except as previously
--------------------------
disclosed in the Commission Filings, since December 31, 1998, (i) there has not
been any event, change, occurrence, effect, fact or circumstance having, or
which could reasonably be expected to have, a Material Adverse Effect or a
Performance Material Adverse Effect on the Company; (ii) the businesses of the
Company and each of its Subsidiaries taken as a whole has been conducted only in
the ordinary course consistent with past practice and (iii) neither the Company
nor any of its Subsidiaries has taken any action referred to in Sections
6.3(b)(i), (iii), (iv), (v), (x), (xi), (xii), (xiii) or (xvi) (but, in the case
of (xvi), only with respect to the sub-clauses of 6.3 previously referred to in
this clause (iii)) hereof.
Section 4.7 Title to Properties; Encumbrances. The Company and each
----------------------------------
of its Subsidiaries has good, valid and marketable title to, or, in the case of
leased properties and assets, valid leasehold interests in, (i) all of its
material tangible properties and assets (real and personal), including, without
limitation, all the properties and assets reflected in the consolidated balance
sheet as of December 31, 1998 contained in the Commission Filings, except as
indicated in the notes thereto and except for properties and assets reflected
in the consolidated balance sheet as of December 31, 1998 contained in the
Commission Filings which have been sold or otherwise disposed of in the ordinary
course of business after such date and except where the failure to have such
good, valid and marketable title could not reasonably be expected to have a
Material
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<PAGE>
Adverse Effect on the Company, and (ii) all the tangible properties and assets
purchased by the Company and any of its Subsidiaries since December 31, 1998,
except for such properties and assets which have been sold or otherwise disposed
of in the ordinary course of business and except where the failure to have such
good, valid and marketable title could not reasonably be expected to have a
Material Adverse Effect on the Company; in each case subject to no encumbrance,
lien, charge or other restriction of any kind or character, except for (A) liens
reflected in the consolidated balance sheet as of December 31, 1998 contained in
the Commission Filings, (B) liens consisting of zoning or planning restrictions,
easements, permits and other restrictions or limitations on the use of real
property or irregularities in title thereto which do not materially detract from
the value of, or impair the use of, such property by the Company or any of its
Subsidiaries in the operation of its respective business, (C) liens for current
taxes, assessments or governmental charges or levies on property not yet due and
delinquent and (D) such encumbrances, liens, charges or other restrictions which
could not reasonably be expected to have a Material Adverse Effect on the
Company.
Section 4.8 Compliance with Laws. (i) Except as disclosed in the
--------------------
Commission Filings, the Company and its Subsidiaries are in compliance with all
applicable federal, state, local and foreign statutes, laws, regulations,
orders, judgments and decrees except where the failure to so comply could not
reasonably be expected to have a Material Adverse Effect or a Performance
Material Adverse Effect on the Company.
(ii) The Company and its Subsidiaries hold, to the extent legally
required, all federal, state, local and foreign permits, approvals, licenses,
authorizations, certificates, rights, exemptions and orders from governmental
authorities (the "Permits") that are material to and required for the operation
-------
of the business of the Company or its Subsidiaries as now conducted, and there
has not occurred any default under any such Permit, except to the extent that
the failure to so hold or such default could not reasonably be expected to have
a Material Adverse Effect or a Performance Material Adverse Effect on the
Company.
Section 4.9 Litigation. Except as disclosed in the Commission
----------
Filings, there is no action, suit, proceeding at law or in equity, or any
arbitration or any administrative or other proceeding by or before (or to the
best knowledge of the Company any investigation by) any governmental or other
instrumentality or agency, pending, or, to the best knowledge of the Company,
threatened, against or affecting the Company or any of its Subsidiaries, or any
of their respective properties or rights which could reasonably be expected to
have a Material Adverse Effect or a Performance Material Adverse Effect on the
Company. Neither the Company nor any of its Subsidiaries is subject to any
judgment, order or decree entered in any lawsuit or proceeding which could
reasonably be expected to have a Material Adverse Effect or a Performance
Material Adverse Effect on the Company.
Section 4.10 Employee Benefit Plans. (a) "Employee Benefit Plan"
----------------------
shall mean each domestic and foreign employee benefit plan, within the meaning
of Section 3(3) of the Employee Retirement Income Security Act of 1974, as
amended, and the rules and regulations thereunder ("ERISA"), whether or not
-----
subject to ERISA, and each stock option, stock appreciation right, restricted
stock, stock purchase, incentive, bonus, profit-sharing, savings, deferred
compensation, health, medical, dental, life insurance, disability, accident,
supplemental
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<PAGE>
unemployment or retirement, employment, severance or salary or benefits
continuation or fringe benefit plan, program, arrangement, agreement or
commitment currently maintained by the Company or any Subsidiary thereof
(including, for this purpose and for the purpose of all of the representations
in this Section 4.10, all employers (whether or not incorporated) that would be
treated together with the Company as a single employer within the meaning of
Section 414 of the Code) for the benefit of any employee, director, former
employee, former director of the Company or any of its Subsidiaries or to which
the Company or any Subsidiary thereof contributes (or has any obligation to
contribute), has any liability or is a party.
(b)(i) Each Employee Benefit Plan is in substantial compliance with
all applicable laws (including, without limitation, ERISA and the Code) and has
been administered and operated in all material respects in accordance with its
terms; (ii) each Employee Benefit Plan which is intended to be "qualified"
within the meaning of Section 401(a) of the Code has, after 1993, received a
favorable determination letter from the Internal Revenue Service and, to the
best knowledge of the Company, no event has occurred and no condition exists
which could reasonably be expected to result in the revocation of any such
determination; (iii) the actuarial present value of the accumulated plan
benefits (whether or not vested) under each Employee Benefit Plan covered by
Title IV of ERISA (other than any Employee Benefit Plan which is a
"Multiemployer Plan" (as defined in Section 4001(a)(3) of ERISA) (a
"Multiemployer Plan")) as of the close of its most recent plan year did not
- -------------------
exceed the market value of the assets allocable thereto; (iv) no Employee
Benefit Plan covered by Title IV of ERISA (other than any Multiemployer Plan)
has been terminated and no proceedings have been instituted to terminate or
appoint a trustee under Title IV of ERISA to administer any such plan; (v) no
"reportable event" (as defined in Section 4043 of ERISA) has occurred with
respect to any Employee Benefit Plan covered by Title IV of ERISA (other than
events for which the notice period has been waived or with respect to any
Multiemployer Plan); (vi) no Employee Benefit Plan (other than any Multiemployer
Plan) subject to Section 412 of the Code or Section 302 of ERISA has incurred
any accumulated funding deficiency within the meaning of Section 412 of the Code
or Section 302 of ERISA, or obtained a waiver of any minimum funding standard or
an extension of any amortization period under Section 412 of the Code or Section
303 or 304 of ERISA; (vii) as of the date of this Agreement, none of the Company
nor any of its Affiliates has incurred any unsatisfied withdrawal liability
under Part 1 of Subtitle E of Title IV of ERISA to any Multiemployer Plan and
neither the Company nor any of its Affiliates would be subject to any such
withdrawal liability if, as of the close of the most recent fiscal year of any
such plan ended prior to the date hereof, the Company or any such Affiliate were
to engage in a complete withdrawal (as defined in Section 4203 of ERISA) or
partial withdrawal (as defined in Section 4205 of ERISA) from any such plan;
(viii) full payment has been timely made of all amounts which the Company and/or
its Subsidiaries is required under applicable law or under any Employee Benefit
Plan or related agreement to have paid as of the last day of the most recent
fiscal year of such Employee Benefit Plan ended prior to the date hereof, and
the Company and each such Subsidiary have made adequate provisions, in
accordance with GAAP, in their financial statements for all obligations and
liabilities under all Employee Benefit Plans that have accrued but have not been
paid because they are not yet due under the terms of any such Employee Benefit
Plan or any related agreement or applicable law, and, to the best knowledge of
the Company, no event has occurred or condition exists that would reasonably be
expected to result in a material
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<PAGE>
increase in the level of such amounts paid or accrued for the most recently
ended fiscal year; (ix) no Employee Benefit Plan provides for post-employment or
retiree health, life insurance or other welfare benefits which could result in a
material liability of the Company or any Subsidiary thereof; (x) neither the
Company nor any of its Subsidiaries has any unfunded liabilities pursuant to any
Employee Benefit Plan which is an "employee pension benefit plan" (within the
meaning of Section 3(2) of ERISA) that is not intended to be qualified under
Section 401(a) of the Code; (xi) neither the Company nor any of its
Subsidiaries, nor any of their respective directors, officers or employees, nor,
to the best knowledge of the Company, any other "disqualified person" or "party
in interest" (as defined in Section 4975(e)(2) of the Code and Section 3(14) of
ERISA, respectively) has engaged in any transaction, act or omission to act in
connection with any Employee Benefit Plan that could reasonably be expected to
result in the imposition on the Company or any of its Subsidiaries of a material
penalty or fine pursuant to Section 502 of ERISA, damages pursuant to Section
409 of ERISA or a tax pursuant to Section 4975 of the Code or any obligation by
the Company or any of its Subsidiaries to indemnify any employee, officer or
director of the Company or any of its Affiliates against any such penalty, fine,
damages or tax; (xii) the execution of this Agreement and the consummation of
the transactions contemplated hereby do not constitute a triggering event under
any Employee Benefit Plan, policy, arrangement, statement, commitment or
agreement, which (either alone or upon the occurrence of any additional or
subsequent event) will or may result in any payment, "parachute payment" (as
such term is defined in Section 280G of the Code), severance, bonus, retirement
or job security or similar-type benefit, or increase any benefits or accelerate
the payment or vesting of any benefits to any employee or former employee or
director of the Company or any of its Subsidiaries; (xiii) no liability, claim,
action, audit, examination or litigation has been made, commenced or, to the
best knowledge of the Company, threatened with respect to any Employee Benefit
Plan (other than routine claims for benefits payable in the ordinary course)
which could result in a material liability of the Company or any Subsidiary
thereof; and (xiv) neither the Company nor any of its Affiliates has incurred or
expects to incur any material liability (including, without limitation,
additional contributions, fines, taxes or penalties) as a result of a failure to
administer or operate any Employee Benefit Plan that is a "group health plan"
(as such term is defined in Section 607(1) of ERISA or Section 5000(b)(1) of the
Code) in compliance with the applicable requirements of Part 6 of Subtitle B of
Title I of ERISA or Section 4980B of the Code.
Section 4.11 Employment Relations and Agreements. Except as could
-----------------------------------
not reasonably be expected to have a Material Adverse Effect or a Performance
Material Adverse Effect on the Company, (i) each of the Company and its
Subsidiaries is in compliance with all federal, foreign, state or other
applicable laws respecting employment and employment practices, terms and
conditions of employment and wages and hours, and has not and is not engaged in
any unfair labor practice; (ii) no unfair labor practice charge or complaint
against the Company or any of its Subsidiaries is pending before the National
Labor Relations Board or an equivalent tribunal under applicable foreign law;
(iii) there is no labor strike, slowdown, stoppage or dispute actually pending
or, to the best knowledge of the Company, threatened against or involving the
Company or any of its Subsidiaries; (iv) no representation question exists
respecting the employees of the Company or any of its Subsidiaries; (v) neither
the Company nor any of its Subsidiaries is experiencing or has experienced
during the immediately preceding three (3) years any labor strike, slowdown,
stoppage or dispute and (vi) there has been no "mass layoff" or "plant closing"
by the
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<PAGE>
Company as defined in WARN or state law equivalent, or any other mass layoff or
plant closing that would trigger notice pursuant to WARN or state law
equivalent, within ninety (90) days prior to the Closing Date.
Section 4.12 Taxes.
-----
(a) Tax Returns. The Company and each of its Subsidiaries has timely
-----------
filed or caused to be timely filed with the appropriate taxing authorities all
federal and other returns, statements, forms and reports for Taxes (as
hereinafter defined) ("Returns") that are required to be filed by, or with
-------
respect to, the Company and such Subsidiaries on or prior to the Closing Date.
The Returns reflect accurately all liability for Taxes of the Company and each
of its Subsidiaries for the periods covered thereby. "Taxes" shall mean all
-----
taxes, assessments, charges, duties, fees, levies or other governmental charges
including, without limitation, all Federal, state, local, foreign and other
income, franchise, profits, capital gains, capital stock, transfer, sales, use,
occupation, property, excise, severance, windfall profits, stamp, license,
payroll, withholding and other taxes, assessments, charges, duties, fees, levies
or other governmental charges of any kind whatsoever (whether payable directly
or by withholding and whether or not requiring the filing of a Return), all
estimated taxes, deficiency assessments, additions to tax, penalties and
interest and shall include any liability for such amounts as a result of being a
member of a combined, consolidated, unitary or affiliated group.
(b) Payment of Taxes. The Company and its Subsidiaries have timely
----------------
paid all Taxes that are currently due and payable except for those contested in
good faith and for which adequate reserves have been made on the financial
statements of the Company and its Subsidiaries in accordance with GAAP.
(c) Other Tax Matters. (i) The Company and each of its Subsidiaries
-----------------
have not been the subject of an audit or other examination of Taxes by the tax
authorities of any nation, state or locality with respect to any taxable period
for which the statute of limitations has not expired, nor has the Company or any
of its Subsidiaries received any written notices with respect to such taxable
periods from any tax authority relating to any issue which could affect the Tax
liability of the Company or any of its Subsidiaries that has not been resolved
or paid in full.
(ii) Neither the Company nor any of its Subsidiaries has been included
in any "consolidated," "unitary" or "combined" Return (other than Returns which
include only the Company and any Subsidiaries of the Company) provided for under
the laws of the United States, any foreign jurisdiction or any state or locality
with respect to Taxes for any taxable period for which the statute of
limitations has not expired.
(iii) All Taxes which the Company or any of its Subsidiaries is (or
was) required by law to withhold or collect have been duly withheld or
collected, and have been timely paid over to the proper authorities to the
extent due and payable.
(iv) There are no tax sharing, allocation, indemnification or similar
agreements or arrangements in effect as between the Company, any Subsidiary, or
any predecessor or Affiliate of any of them and any other party under which
Parent, Sub or the Company (or any of its
-26-
<PAGE>
Subsidiaries) could be liable for any Taxes or other claims of any party other
than the Company or any Subsidiary of the Company.
(v) No indebtedness of the Company or any of its Subsidiaries consists
of "corporate acquisition indebtedness" within the meaning of Section 279 of the
Code.
(vi) Neither the Company nor any of its Subsidiaries has been required
to include in income any adjustment pursuant to Section 481 or any similar
provision of the Code or the corresponding tax laws of any nation, state or
locality by reason of a voluntary change in accounting method initiated by the
Company or any of its Subsidiaries, and the Internal Revenue Service or other
taxing authority has not initiated or proposed any such adjustment or change in
accounting method.
(vii) Neither the Company nor any of its Subsidiaries has, as of the
Closing Date: (A) entered into an agreement or waiver extending any statute of
limitations relating to the payment or collection of Taxes of the Company or any
of its Subsidiaries or (B) is presently contesting the Tax liability of the
Company or any of its Subsidiaries before any court, tribunal or agency.
(viii) No election under 341(f) of the Code has been made or shall be
made prior to the Closing Date to treat the Company as a consenting corporation,
as defined in Section 341 of the Code.
Section 4.13 Liabilities. Neither the Company nor any of its
-----------
Subsidiaries has any claims, liabilities or indebtedness, contingent or
otherwise of any kind whatsoever, outstanding except (i) as set forth in the
Commission Filings, (ii) for liabilities incurred subsequent to December 31,
1998 in the ordinary course of business consistent with past practice (other
than borrowings (x) under the Company's existing $500 million credit facility
(the "Credit Facility") pursuant to the Credit Agreement, dated March 13, 1998
---------------
by and among the Company, Wang Nederland B.V., the lenders from time to time
party thereto, Bankers Trust Company, National Westminster Bank plc and Lehman
Commercial Paper Inc. or (y) other ordinary course borrowings not exceeding, in
the aggregate, $50 million) or (z) claims, liabilities or indebtedness which
could not reasonably be expected to have a Material Adverse Effect on the
Company.
Section 4.14 Intellectual Property. (a) The Company owns or is
---------------------
licensed to use, the rights to all patents, trademarks, trade names, service
marks, copyrights together with any registrations and applications therefor,
internet domain names, net lists, schematics, technology, trade secrets, source
codes, know-how, computer software programs or applications including, without
limitation, all object and source codes and tangible or intangible proprietary
information or material used in and material to the business of the Company and
any of its Subsidiaries as currently conducted (the "Company Intellectual
--------------------
Property"), except where the failure to so own or license could not reasonably
- --------
be expected to have a Material Adverse Effect on the Company. Neither the
Company nor any of its Subsidiaries is, or as a result of the execution,
delivery or performance of the Company's obligations hereunder will be, in
violation of, or lose any rights pursuant to, any license or agreement, except
as could not reasonably be expected to have a Material Adverse Effect on the
Company.
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<PAGE>
(b) No claims with respect to the Company Intellectual Property are
pending or, to the best knowledge of the Company, threatened by any Person (i)
that the manufacture, sale or use of any product or process as now used or
offered or proposed for use or sale by the Company or any of its Subsidiaries
infringes on any copyright, trade secret, patent or other intellectual property
right of any Person, or (ii) challenging the ownership, validity, enforceability
or effectiveness of any of the Company Intellectual Property owned by the
Company or any of its Subsidiaries. To the best knowledge of the Company, all
issued patents, all registered trademarks and service marks and all copyrights
owned by the Company or any of its Subsidiaries are valid, enforceable and
subsisting. To the best knowledge of the Company, there has not been and there
is not any material unauthorized use, infringement or misappropriation of any of
the Company Intellectual Property by any third Person, including, without
limitation, any employee or former employee.
(c) No Company Intellectual Property owned by the Company is subject
to any outstanding order, judgment, decree, stipulation or agreement restricting
in any material manner the licensing thereof by the Company or any of its
Subsidiaries.
Section 4.15 Schedule 14D-1. None of the information supplied by the
--------------
Company for inclusion or incorporation by reference in the Offer Documents will
at the respective times the Offer Documents are filed with the Commission,
contain any untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements made, in light of the
circumstance under which they are made, not misleading.
Section 4.16 Broker's or Finder's Fee. Except for the fees of CSFB
------------------------
and Greenhill & Co., LLC (whose fees and expenses will be paid by the Company in
accordance with the Company's agreement with such firms, true and correct copies
of which have been previously delivered to Parent by the Company), no agent,
broker, Person or firm acting on behalf of the Company is, or will be, entitled
to any commission or broker's or finder's fees from any of the parties hereto,
or from any Person controlling, controlled by, or under common control with any
of the parties hereto, in connection with this Agreement or any of the
transactions contemplated hereby.
Section 4.17 Environmental Laws and Regulations. Except as could not
----------------------------------
reasonably be expected to have a Material Adverse Effect on the Company, (i)
Hazardous Materials have not at any time been Released or disposed of, on any
Company Property, or by the Company on or to the best knowledge of the Company
no Hazardous Materials Released by the Company have migrated to or been
transmitted to any property adjoining or adjacent to any Company Property or any
business or operations of the Company or any of its Subsidiaries, (ii) the
Company and each of its Subsidiaries are in compliance with all Environmental
Laws and the requirements of any permits issued under such Environmental Laws
with respect to any Company Property, (iii) there are no past, pending or to the
knowledge of the Company any threatened Environmental Claims against the Company
or any of its Subsidiaries or any Company Property and (iv) to the knowledge of
the Company, there are no facts or circumstances, conditions or occurrences
regarding any Company Property or any property adjoining or adjacent to any
currently or formerly owned Company Property that could reasonably be
anticipated (A) to form the basis of an Environmental Claim against the Company
or any of its Subsidiaries or any
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<PAGE>
Company Property or (B) to cause such Company Property to be subject to any
restrictions on its ownership, occupancy, use or transferability under any
Environmental Law.
For purposes of this Agreement, the following terms shall have the
following meanings: (i) "Company Property" means any real property owned, leased
----------------
or operated by the Company or any of its Subsidiaries; (ii) "Hazardous
---------
Materials" means (A) any petroleum or petroleum products, radioactive materials,
asbestos in any form that has become friable, urea formaldehyde foam insulation,
transformers or other equipment that contain dielectric fluid containing levels
of polychlorinated biphenyls, gas; (B) any chemicals, materials or substances
defined as or included in the definition of "hazardous substances," "hazardous
wastes," "hazardous materials," "extremely hazardous wastes," "extremely
hazardous substances," "restricted hazardous wastes," "toxic substances," "toxic
pollutants," or words of similar import, under any applicable Environmental Law;
and (iii) "Environmental Law" means any federal, state, foreign or local
-----------------
statute, law, rule, regulation, ordinance, guideline, policy, code or rule of
common law in effect and in each case as amended as of the date hereof and
Closing Date, and any judicial interpretation thereof or administrative order
applicable to the Company or its operations or property as of the date hereof
and Closing Date, including any judicial or administrative order, consent decree
or judgment, relating to the environment, health, safety or Hazardous Materials,
including without limitation the Comprehensive Environmental Response,
Compensation, and Liability Act of 1980, as amended, 42 U.S.C. (S) 9601 et seq.;
-- ----
the Resource Conservation and Recovery Act, as amended, 42 U.S.C. (S) 6901 et
--
seq.; the Federal Water Pollution Control Act, as amended, 33 U.S.C. (S) 1251 et
- ---- --
seq.; the Toxic Substances Control Act, 15 U.S.C. (S) 2601 et seq.; the Clean
- ---- -- ----
Air Act, 42 U.S.C. (S) 7401 et seq.; Occupational Safety and Health Act, 29
-- ----
U.S.C. 651 et seq.; Oil Pollution Act of 1990, 33 U.S.C. (S) 2701 et seq.; the
-- ---- -- ----
Safe Drinking Water Act, 42 U.S.C. (S) 300f et seq., and their state and local
-- ----
counterparts and equivalents; and (iv) "Environmental Claims" means any and all
--------------------
administrative, regulatory or judicial actions, suits, demands, demand letters,
claims, liens, notices of noncompliance or violation, investigations or
proceedings under any Environmental Law or any permit issued under any such
Environmental Law (for purposes of this subclause (iv), "Claims"), including
------
without limitation (A) any and all Claims by governmental or regulatory
authorities for enforcement, cleanup, removal, response, remedial or other
actions or damages pursuant to any applicable Environmental Law and (B) any and
all Claims by any third party seeking damages, contribution, indemnification,
cost recovery, compensation or injunctive relief resulting from Hazardous
Materials or arising from alleged injury or threat of injury to health, safety
or the environment; and (v) "Release" means disposing, discharging, injecting,
-------
spilling, leaking, leaching, dumping, emitting, escaping, emptying or seeping
into or upon any land or surface water or ground water except for releases into
the air or surface water in compliance with Environmental Laws and all
applicable permits.
Section 4.18 State Takeover Statutes. The Board of Directors of the
-----------------------
Company has approved the Offer, the Merger and this Agreement and such approval
is sufficient to render inapplicable to the Offer, the Merger and this Agreement
and the other transactions contemplated by this Agreement the provisions of
Section 203 of the Delaware General Corporation Law. Except for Section 203 of
the Delaware General Corporation Law (which has been rendered inapplicable), no
other takeover statute or similar statute or regulation of any state of the
United States of America is applicable to the Offer, the Merger or this
Agreement.
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<PAGE>
Section 4.19 Voting Requirements. The affirmative vote of the
-------------------
holders of at least a majority of the outstanding shares of Common Stock, the
Series A Preferred Stock and the Series B Preferred Stock (voting as one class,
with each share of Common Stock, each share of Series A Preferred Stock and each
share of the Series B Preferred Stock having one (1) vote) entitled to be cast
approving this Agreement is the only vote of the holders of any class or series
of the Company's capital stock necessary to approve this Agreement and the
transactions contemplated by this Agreement.
Section 4.20 Rights Agreement. The Company and the Board of
----------------
Directors of the Company have taken and will maintain in effect all necessary
action to (i) render the Rights Agreement inapplicable with respect to the
Offer, the Merger and the other transactions contemplated by this Agreement and
(ii) ensure that (y) neither Parent nor Sub nor any of their Affiliates (as
defined in the Rights Agreement) or Associates (as defined in the Rights
Agreement) is considered to be an Acquiring Person (as defined in the Rights
Agreement) and (z) the provisions of the Rights Agreement, including the
occurrence of a Distribution Date (as defined in the Rights Agreement), are not
and shall not be triggered by reason of the announcement or consummation of the
Offer, the Merger or the consummation of any of the other transactions
contemplated by this Agreement. The Company has made available to Parent a
complete and correct copy of the Rights Agreement as amended and supplemented to
the date of this Agreement.
Section 4.21 Year 2000. (a) All computer systems, computer software
---------
or technology that are internal and material to the business, finances or
operations of the Company and its Subsidiaries ("Material Systems") will not be
----------------
materially adversely affected by any problems associated with Year 2000
Compliance. (b) The Company will not suffer a Material Adverse Effect caused
by any problems associated with Year 2000 Compliance of any Material Systems.
(c) To the best knowledge of the Company, the Company will not suffer a
Material Adverse Effect caused by any problems associated with Year 2000
Compliance of any of its products or services sold or licensed to customers of
the Company and its Subsidiaries. (d) Neither the Company nor any of its
Subsidiaries have received any written claims or demands asserting any problems
associated with Year 2000 Compliance that have had, or could reasonably be
expected to have, a Material Adverse Effect on the Company.
For purposes of this Agreement, "Year 2000 Compliance" means that a
--------------------
product or system is (i) able to receive, record, store, process, calculate,
manipulate and output dates from and after January 1, 2000, time periods that
include January 1, 2000 and information that is dependent on or relates to such
dates or time periods, in that same manner and with the same accuracy,
functionality, data integrity and performance as when dates or time periods
prior to January 1, 2000 are involved and (ii) able to store and output date
information in a manner that is unambiguous as to century.
Section 4.22 Series A and Series B Preferred Stock. Since the
-------------------------------------
original date of the Certificate of Designation of the Series A Preferred Stock
or the Certificate of Designation of the Series B Preferred Stock, as the case
may be, neither the Series A Preferred Stock Conversion Price nor the Series B
Preferred Stock Conversion Price, as the case may be, has been subject to any
adjustment, whether in accordance with the terms of such Certificate of
Designation or
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<PAGE>
otherwise. Neither the holders of the Series A Preferred Stock nor the holders
of the Series B Preferred Stock are entitled to (i) receive any accrued
dividends which have not been paid when due or (ii) elect members to the
Company's Board of Directors in accordance with the terms of their respective
Certificate of Designation.
Section 4.23 Common Stock Purchase Warrants and Microsoft Warrant.
----------------------------------------------------
Since the original date of the Common Stock Warrant Purchase Agreement or the
Microsoft Warrant Agreement, as the case may be, (i) neither the Common Stock
Purchase Warrant Exercise Price nor the Microsoft Warrant Exercise Price, as the
case may be, has been subject to any adjustment and (ii) no event has occurred
which would entitle a holder of a Common Stock Purchase Warrant to exercise such
Common Stock Purchase Warrant for more than one share of Common Stock.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT AND SUB
------------------------------------------------
Section 5. Each of Parent and Sub hereby represents and warrants to
the Company that, except in connection with the transactions contemplated hereby
or as set forth on Parent's disclosure letter (the "Parent Disclosure Letter")
------------------------
delivered concurrently with the delivery of this Agreement:
Section 5.1 Due Organization, Good Standing and Corporate Power.
---------------------------------------------------
Parent is a public company with limited liability duly organized and validly
existing under the laws of The Netherlands. Sub is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware.
Section 5.2 Authorization and Validity of Agreement. Each of Parent
---------------------------------------
and Sub has the requisite corporate power and authority to execute and deliver
this Agreement, to perform its obligations hereunder and to consummate the
transactions contemplated hereby. The execution, delivery and performance of
this Agreement by Parent and Sub, and the consummation by each of them of the
transactions contemplated hereby, have been duly authorized and approved by the
Supervisory Board and the Executive Board of Parent and the Board of Directors
of Sub. No other corporate action on the part of either of Parent or Sub is
necessary to authorize the execution, delivery and performance of this Agreement
by each of Parent and Sub and the consummation of the transactions contemplated
hereby (other than the filing of appropriate merger documents as required by the
Delaware General Corporation Law). This Agreement has been duly executed and
delivered by each of Parent and Sub and, assuming that this Agreement is a valid
and binding obligation of the Company enforceable against the Company, is a
valid and binding obligation of each of Parent and Sub, enforceable against each
of Parent and Sub in accordance with its terms, except that such enforcement may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other similar laws affecting the enforcement of creditors' rights generally, and
general equitable principles.
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Section 5.3 Consents and Approvals; No Violations. Assuming (i) the
-------------------------------------
filings required under the HSR Act, are made and the waiting period thereunder
has been terminated or has expired, (ii) voluntary notification under Section
721 of Exon-Florio is made, (iii) the prior notification and reporting
requirements of the European Community pursuant to the EU Antitrust Laws as well
as any antitrust filings/notifications which must or may be effected at the
national level in countries having jurisdiction are made, (iv) the requirements
of the Exchange Act relating to the Proxy Statement, if any, and the Offer are
met, (v) the filing of the Certificate of Merger and other appropriate merger
documents, if any, as required by the Delaware General Corporation Law, are
made, (vi) such actions as are necessary in order to comply with Industrial
Security Regulations of the U.S. Department of Defense and (vii) approval of the
Merger and this Agreement by the stockholders of the Company, if required by the
Delaware General Corporation Law, is received, the execution and delivery of
this Agreement by Parent and Sub and the consummation by Parent and Sub of the
transactions contemplated hereby will not: (A) violate or conflict with any
provision of the Articles of Association of Parent or the Certificate of
Incorporation or the By-Laws of Sub; (B) violate or conflict with any statute,
ordinance, rule, regulation, order or decree of any court or of any governmental
or regulatory body, agency or authority applicable to Parent or any of its
subsidiaries or by which either of their respective properties or assets may be
bound, except for such violations or conflicts which are not "material", as such
term is commonly understood in connection with a Person's disclosure obligations
under the Securities Act or the Exchange Act; (C) require any filing with, or
permit, consent or approval of, or the giving of any notice to, any governmental
or regulatory body, agency or authority, except for such filings, permits,
consents or approvals which are not "material", as such term is commonly
understood in connection with a Person's disclosure obligations under the
Securities Act or the Exchange Act; or (D) result in a violation or breach of,
conflict with, constitute (with or without due notice or lapse of time or both)
a default (or give rise to any right of termination, cancellation, payment or
acceleration) under, or result in the creation of any lien, security interest,
charge or encumbrance upon any of the properties or assets of Parent, or any of
its subsidiaries under, or give rise to any obligation, right of termination,
cancellation, acceleration or increase of any obligation or a loss of a material
benefit under, any of the terms, conditions or provisions of any note, bond,
mortgage, indenture, license, franchise, permit, agreement, contract, lease,
franchise agreement or other instrument or obligation to which Parent or any of
its subsidiaries is a party, or by which any such Person or any of its
properties or assets are bound, except for such violations, breaches or
conflicts which are not "material", as such term is commonly understood in
connection with a Person's disclosure obligations under the Securities Act or
the Exchange Act.
Section 5.4 Schedule 14D-9 and Proxy Statement. The written
----------------------------------
information supplied or to be supplied by Parent and Sub for inclusion in the
Proxy Statement and the Schedule l4D-9 of the Company will not contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements made, in light
of the circumstances under which they are made, not misleading.
Section 5.5 Absence of Certain Changes. Since December 31, 1998,
--------------------------
there has not been any event, change, occurrence, effect, fact or circumstance
having, or which could reasonably be expected to have, a Material Adverse Effect
or Performance Material Adverse Effect on Parent.
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Section 5.6 Broker's or Finder's Fee. Except for ABN Amro Bank N.V.
------------------------
and Merrill Lynch, Pierce Fenner & Smith Incorporated (whose fees and expenses
as financial advisor to Parent and Sub will be paid by Parent or Sub), no agent,
broker, Person or firm acting on behalf of Parent or Sub is, or will be,
entitled to any commission or broker's or finder's fees from any of the parties
hereto, or from any Person controlling, controlled by, or under common control
with any of the parties hereto, in connection with this Agreement or any of the
transactions contemplated hereby.
Section 5.7 Sub's Operations. Sub was formed solely for the purpose
----------------
of engaging in the transactions contemplated by this Agreement and has not
engaged in any business activities or conducted any operations other than in
connection with such transactions.
Section 5.8 Sufficient Funds. Parent and Sub expect to have
----------------
available to them funds sufficient to satisfy all of Parent's and Sub's
respective obligations hereunder pursuant to a definitive commitment letter (the
"Commitment Letter") issued severally by ABN Amro Bank N.V. and ING Bank N.V.,
subject only to the conditions set forth therein. The Commitment Letter has not
been modified, amended or waived by any party thereto. A copy of the Commitment
Letter has previously been delivered to the Company. The Commitment Letter has
been executed by Parent and, to the extent any fees are due to the lenders party
thereto on such date of execution, such fees have been paid.
ARTICLE VI
TRANSACTIONS PRIOR TO CLOSING DATE
----------------------------------
Section 6.1 Access to Information Concerning Properties and Records.
-------------------------------------------------------
During the period commencing on the date hereof until such time as nominees of
Parent shall comprise more than half of the members of the Board of Directors of
the Company or this Agreement shall have been terminated pursuant to Section 9.1
hereof, the Company shall, and shall cause each of its Subsidiaries to, upon
reasonable notice, afford Parent, Sub, their financing sources and their
respective employees, counsel, accountants, consultants and other authorized
representatives, reasonable access during normal business hours to the books and
records of the Company and its Subsidiaries (and in addition, Parent and Sub, in
coordination with the Company's management, shall be given such access also to
the employees and properties of the Company and its Subsidiaries) in order that
they may have the opportunity to make such investigations as they shall desire
of the affairs of the Company and its Subsidiaries; provided, however, that such
-------- -------
investigation shall not affect the representations and warranties made by the
Company in this Agreement. The Company shall furnish promptly to Parent a copy
of each form, report, schedule, statement, registration statement and other
document filed by it or its Subsidiaries during such period pursuant to the
requirements of the Securities Act or the Exchange Act. The Company agrees to
cause its officers and employees to furnish such additional financial and
operating data and other information and respond to such reasonable inquiries as
Parent shall from time to time request.
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Section 6.2 Confidentiality. Information obtained by Parent and its
---------------
counsel, accountants, consultants and other authorized representatives pursuant
to Section 6.1 hereof shall be subject to the provisions of the Confidentiality
Agreement previously entered into between the Company and Parent (the
"Confidentiality Agreement").
- --------------------------
Section 6.3 Conduct of the Business of the Company Pending the
--------------------------------------------------
Closing Date. The Company agrees that, except as permitted, required or
- ------------
specifically contemplated by, or otherwise described in, this Agreement, as set
forth on Schedule 6.3 of the Company's Disclosure Letter or otherwise consented
to or approved in writing by Parent, during the period commencing on the date
hereof until such time as nominees of Parent shall comprise more than half of
the members of the Board of Directors of the Company or this Agreement shall
have been terminated pursuant to Section 9.1 hereof:
(a) The Company shall, and shall cause each of its Subsidiaries to,
conduct their respective operations only according to their ordinary and
usual course of business consistent with past practice and use their
reasonable best efforts to preserve intact their respective business
organization, keep available the services of their officers and employees
and maintain satisfactory relationships with licensors, suppliers,
distributors, clients, joint venture partners and others having significant
business relationships with them; and
(b) The Company shall not, and shall cause each of its Subsidiaries
not to:
(i) amend its Certificate of Incorporation or its By-Laws (or
comparable governing documents);
(ii) except (A) upon the exercise of Options, Common Stock
Purchase Warrants or the Microsoft Warrant, (B) upon the conversion of
the Series A Preferred Stock or Series B Preferred Stock and (C)
pursuant to the terms of the Ancillary Consideration Agreement, dated
as of March 17, 1998, by and between the Company and Olivetti, issue
or sell, or authorize to issue or sell, any shares of its capital
stock or any other securities, or issue or sell, or authorize to issue
or sell, any securities convertible into, or options, warrants or
rights to purchase or subscribe to, or enter into any arrangement or
contract with respect to the issuance or sale of, any shares of its
capital stock or any other securities, or make any other changes in
its capital structure;
(iii) sell or pledge or agree to sell or pledge any stock or
other equity interest owned by it in any other Person except to the
extent required to be pledged to the collateral agent under the Credit
Facility;
(iv) except in the case of the Company's wholly-owned
Subsidiaries, in the ordinary course of business consistent with past
practice, declare, pay or set aside any dividend (other than dividends
on the Series A Preferred Stock or Series B Preferred Stock in
accordance with the terms of their respective Certificates of
Designation) or other distribution or payment with respect to, or
split, combine,
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redeem or reclassify, or purchase or otherwise acquire, any shares of
its capital stock;
(v) enter into any contract or commitment with respect to
capital expenditures with a value in excess of, or requiring
expenditures by the Company and its Subsidiaries in excess of, $10
million, individually, or enter into contracts or commitments with
respect to capital expenditures in excess in the aggregate of those
provided for in the Plan;
(vi) acquire, by merging or consolidating with, by purchasing an
equity interest in or a portion of the assets of, or by any other
manner, any material business or any Person, or otherwise acquire any
assets of any Person (other than (A) the purchase of assets in the
ordinary course of business and consistent with past practice, (B)
intercompany transactions and (C) acquisitions which in the aggregate
do not exceed $10 million);
(vii) except in the ordinary course of business consistent with
the Plan including without limitation the implementation of the
Company's job structures and broad bonding program and its various
variable compensation programs (including its management incentives
and sales compensation plans), and except to the extent required under
benefit plans, agreements, collective bargaining agreements or their
arrangements as in effect on the date of this Agreement or applicable
law, rule or regulation, increase materially the compensation or
fringe benefits of any of its directors, officers or employees or
grant any severance or termination pay or enter into any employment,
consulting or severance agreement or arrangement with any present or
former director, officer or other employee of the Company or any of
its Subsidiaries, or establish, adopt, enter into or, except in
connection with the merger of various plans which will not materially
increase the benefits payable thereunder, amend or terminate any
collective bargaining, bonus, profit sharing, thrift, compensation,
stock option, restricted stock, pension, retirement, deferred
compensation, employment, termination, severance or other plan,
agreement, trust, fund, policy or arrangement for the benefit of any
directors, officers or employees; provided, however, the Company may
-------- -------
enter into agreements to provide salary continuation benefits for six
months following an employee's termination without cause so long as on
and after January 1, 1999, the Company shall not be permitted to enter
into such agreements with more than 25 employees and the aggregate
maximum potential cost to the Company of all such agreements shall not
exceed $1,000,000;
(viii) except in the ordinary course of business consistent with
past practice, transfer, lease, license, guarantee, sell, mortgage,
pledge, dispose of, encumber or subject to any lien, any material
assets or incur or modify any indebtedness or other material
liability, or issue any debt securities or assume, guarantee or
endorse or otherwise as an accommodation become responsible for the
obligations of any Person or, make any loan or other extension of
credit;
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(ix) agree to the settlement of any material claim or litigation
except for settlements which have been specifically reserved for in
the Company's 1998 financial statements and except for settlements
which individually do not exceed $300,000 and which in the aggregate,
when aggregated with the Excess Settlement Amounts (as hereinafter
defined), do not exceed $2,000,000; provided, further that those items
-------- -------
described in Section 6.3(b)(ix) of the Company Disclosure Letter may
only be settled for amounts in excess of the amounts reserved therefor
in the Company's 1998 financial statements (the "Excess Settlement
Amounts") to the extent that the Excess Settlement Amounts, when
aggregated with all other settlements after the date hereof , do not
exceed $2,000,000;
(x) make or rescind any material tax election or settle or
compromise any material tax liability;
(xi) adopt or enter into a plan of complete or partial
liquidation, dissolution, merger, consolidation, restructuring,
recapitalization or other reorganization of the Company or any of its
material Subsidiaries (other than the Merger);
(xii) except in the ordinary course of business consistent with
past practice, pay, discharge or satisfy any material claims,
liabilities or obligations (absolute, accrued, asserted or unasserted,
contingent or otherwise), other than the payment, discharge or
satisfaction of claims, liabilities or obligations reflected or
reserved against in, or contemplated by, the consolidated financial
statements (or the notes thereto) contained in the Commission Filings;
(xiii) except in the ordinary course of business consistent with
past practice, enter into any agreement, understanding or commitment
that restrains, limits or impedes the Company's or any of its
Subsidiaries' ability to compete with or conduct any business or line
of business, including, but not limited to, geographic limitations on
the Company's or any of its Subsidiaries' activities;
(xiv) take any action, engage in any transaction or enter into
any agreement which would cause any of the Tender Offer Conditions to
not be satisfied;
(xv) in the case of the Company only, take any action including,
without limitation, the adoption of any shareholder rights plan or
amendments to its Certificate of Incorporation or By-Laws (or
comparable governing documents), which would, directly or indirectly,
restrict or impair the ability of Parent to vote, or otherwise to
exercise the rights and receive the benefits of a stockholder with
respect to, securities of the Company that may be acquired or
controlled by Parent or Sub or permit any stockholder to acquire
securities of the Company on a basis not available to Parent or Sub in
the event that Parent or Sub were to acquire any shares of its capital
stock; or
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<PAGE>
(xvi) agree, in writing or otherwise, to take any of the
foregoing actions.
The Company agrees to consult at least bi-weekly (or such shorter intervals as
Parent may reasonably request) with Parent on ongoing operational issues with
respect to the business and, in any event, shall keep Parent fully informed with
respect to the progress of the transactions described on Schedule 6.3 of the
Company Disclosure Letter. Each of the parties agree to designate an officer to
serve as its designated representative to facilitate these consultations (each,
a "Designated Representative"). The Designated Representative of the Parent
shall use its reasonable efforts to respond to written requests for waivers of
the covenants under this Section 6.3 in no more than 48 hours from the time of
receipt.
Section 6.4 Company Stockholders' Meeting; Preparation of Proxy
---------------------------------------------------
Statement; Short Form Merger. (a) Promptly following the purchase of Offer
- ----------------------------
Securities pursuant to the Offer, if required by law in order to consummate the
Merger, the Company, acting through its Board of Directors, shall, in accordance
with applicable law, duly call, convene and hold a meeting of the stockholders
of the Company (the "Stockholders' Meeting") for the purpose of voting upon this
---------------------
Agreement and the Merger and the Company agrees that this Agreement and the
Merger shall be submitted at such meeting. The Company shall take all action
necessary to solicit from its stockholders proxies, and shall take all other
action necessary and advisable to secure the vote of stockholders required by
applicable law and the Company's Certificate of Incorporation or the Company's
By-Laws to obtain the approval for this Agreement and the Merger. Subject to
Section 6.6 hereof, the Company agrees that it shall include in the Proxy
Statement the recommendation of its Board of Directors that the stockholders of
the Company approve and adopt this Agreement and approve the Merger. Parent
shall cause all shares of capital stock of the Company owned by Parent and its
direct and indirect subsidiaries (including Sub) to be voted in favor of this
Agreement and the Merger.
(b) If stockholder approval of the Merger is required by law, as
promptly as practicable following Parent's request the Company shall prepare and
file a preliminary Proxy Statement with the Commission and shall promptly use
its reasonable best efforts to respond to the comments of the Commission, if
any, in connection therewith and to furnish all information regarding the
Company required in the definitive Proxy Statement (including, without
limitation, financial statements and supporting schedules and certificates and
reports of independent public accountants). Parent, Sub and the Company shall
cooperate with each other in the preparation of the Proxy Statement. Without
limiting the generality of the foregoing, each of Parent and Sub shall furnish
to the Company the information relating to it required by the Exchange Act to be
set forth in the Proxy Statement. As promptly as practicable after the
expiration or termination of the Offer, if required by the Delaware General
Corporation Law in order to consummate the Merger, the Company shall cause the
definitive Proxy Statement to be mailed to the stockholders of the Company and,
if necessary, after the definitive Proxy Statement shall have been so mailed,
promptly circulate amended, supplemental or supplemented proxy material and, if
required in connection therewith, resolicit proxies. The Company shall not use
any proxy material in connection with the meeting of its stockholders without
Parent's prior approval.
(c) Notwithstanding the foregoing clauses (a) and (b), in the event
that Sub shall acquire at least 90% of each of the issued and outstanding shares
of Common Stock, shares
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of Series A Preferred Stock and shares of Series B Preferred Stock, the Company
shall, at the request of Parent and Sub, take all necessary and appropriate
action to cause the Merger to become effective as soon as reasonably practicable
after such acquisition, without a meeting of the Company's stockholders, in
accordance with Section 253 of the Delaware General Corporation Law.
Section 6.5 Reasonable Best Efforts. Subject to the terms and
-----------------------
conditions provided herein, each of the Company, Parent and Sub shall, and the
Company shall cause each of its Subsidiaries to, cooperate and use their
reasonable best efforts to take, or cause to be taken, all appropriate action,
and to make, or cause to be made, all filings necessary, proper or advisable
under applicable laws and regulations to consummate and make effective the
transactions contemplated by this Agreement including, without limitation, their
reasonable best efforts to obtain, prior to the Closing Date, all licenses,
permits, consents, approvals, authorizations, qualifications and orders of
governmental authorities and parties to contracts with the Company and its
Subsidiaries as are necessary for consummation of the transactions contemplated
by this Agreement and to fulfill the conditions to the Offer and the Merger;
provided, however, that no loan agreement or contract for borrowed money shall
- -------- -------
be repaid except as currently required by its terms, in whole or in part, and no
contract shall be amended to increase the amount payable thereunder or otherwise
to be more burdensome to the Company or any of its Subsidiaries in order to
obtain any such consent, approval or authorization without the prior written
consent of Parent (which shall not be unreasonably withheld). Without limiting
the generality of the foregoing, without the prior written consent of the
Company, neither Parent nor Sub will take any action which would cause any of
the conditions set forth in the Commitment Letter not to be satisfied or which
would make its representation in Section 5.8 hereof untrue.
Section 6.6 No Solicitation of Other Offers. (a) The Company and
-------------------------------
its Affiliates and each of their respective officers, directors, employees,
representatives, consultants, investment bankers, attorneys, accountants and
other agents shall immediately cease any discussions or negotiations with any
other parties that may be ongoing with respect to any Acquisition Proposal (as
defined below). Other than in accordance with Section 6.6(b) hereof, the
Company shall not, directly or indirectly, take (and the Company shall not
authorize or permit its Affiliates or its or its Affiliates' officers,
directors, employees, representatives, consultants, investment bankers,
attorneys, accountants or other agents, to so take) any action to (i) solicit,
initiate, facilitate or encourage the making of any Acquisition Proposal or any
inquiries or the making of any proposal that may reasonably be expected to lead
to any Acquisition Proposal (including, without limitation, by taking any action
that would make the Rights Agreement or Section 203 of the Delaware General
Corporation Law inapplicable to an Acquisition Proposal), (ii) participate in
any way in discussions or negotiations with, or furnish or disclose any
information to, any Person (other than Parent, Sub or the agents or
representatives of Parent or Sub) in connection with any Acquisition Proposal,
(iii) enter into any agreement, arrangement or understanding with respect to any
Acquisition Proposal or enter into any arrangement, understanding or agreement
requiring it to abandon, terminate or fail to consummate the Merger or any other
transaction contemplated by this Agreement, (iv) withdraw or modify, or propose
to withdraw or modify, in a manner adverse to Parent or Sub, the approval and
recommendation of the Offer and this Agreement or (v) approve or recommend, or
propose to approve or recommend, any Acquisition Proposal.
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<PAGE>
(b) The Company may take any of the actions prohibited by clauses (ii)
through (v) of the second sentence of Section 6.6(a) hereof in response to an
unsolicited Acquisition Proposal if (1) the Company is in compliance with its
obligations under Section 6.6(c) hereof, (2) with respect to any action that
would otherwise be prohibited by clause (ii) of the second sentence of Section
6.6(a), (A) such action is taken subject to a confidentiality agreement with
terms not more favorable to such third party than the terms of the
Confidentiality Agreement, (B) the Board of Directors of the Company determines,
after receiving advice from outside nationally recognized legal counsel to the
Company and from nationally recognized investment bankers, that such Acquisition
Proposal is reasonably likely to result in a Superior Proposal within a
reasonable period of time and such determination remains in effect at all times
that the Company is taking any of the actions prohibited by clause (ii) with
respect to such Acquisition Proposal and (C) the Board of Directors of the
Company determines, after receiving advice from outside nationally recognized
legal counsel to the Company, that the failure to take such action would likely
breach the fiduciary duties of the Board of Directors and (3) with respect to
any action that would otherwise be prohibited by clauses (iii) through (v) of
the second sentence of Section 6.6(a) such Acquisition Proposal is a Superior
Proposal and the Board of Directors of the Company determines, based on advice
from outside nationally recognized legal counsel to the Company and nationally
recognized investment bankers, that the failure to take such action would likely
breach the fiduciary duties of the Board of Directors.
"Acquisition Proposal" shall mean a proposal or offer for a merger or
--------------------
consolidation with the Company, sale or purchase of substantial assets or stock
of the Company, tender or exchange offer for capital stock of the Company, or
business combination or change in control or similar transaction involving the
Company, other than the Offer and the Merger.
"Superior Proposal" shall mean a bona fide proposal made by a third
-----------------
party to acquire all of the capital stock (including the Warrants) of the
Company which (i) the Board of Directors of the Company determines in its good
faith reasonable judgment, after receiving advice from nationally recognized
investment bankers and outside nationally recognized legal counsel to the
Company, would, if consummated, result in a transaction that is more favorable
to the Company's stockholders than the transactions contemplated hereby, (ii)
with respect to which the Company has received a representation and warranty
with regard to the financing therefor no less favorable to the Company than the
representation contained in Section 5.8 hereof and the Company has no reason to
believe that such representation is not true (it being understood that a
representation which refers to highly confident letters and similar letters
shall not be considered at least as favorable to the Company as the
representation contained in Section 5.8 hereof), and (iii) is not subject to any
financing or due diligence condition.
(c) In addition to the obligations of the Company set forth in Section
6.6(a) hereof, on the date thereof, the Company shall advise Parent of any
request for information or of any Acquisition Proposal, or any inquiry,
proposal, discussions or negotiation with respect to any Acquisition Proposal,
the terms and conditions of such request, Acquisition Proposal, inquiry,
proposal, discussion or negotiation and the Company shall promptly provide to
Parent copies of any written materials received by the Company in connection
with any of the foregoing, and the identity of the Person making any such
Acquisition Proposal or such request, inquiry or proposal or with whom any
discussion or negotiation are taking place. The Company shall promptly
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provide to Parent any written non-public information concerning the Company
provided to any other Person in connection with any Acquisition Proposal which
was not previously provided to Parent. In the event that the Board of Directors
has determined, after receiving advice from nationally recognized investment
bankers and outside nationally recognized legal counsel, that an Acquisition
Proposal is a Superior Proposal, the Company shall deliver to Parent written
notice of such determination. During the three (3) business day period
immediately succeeding delivery of such notice, the Company shall, and shall
cause its financial and legal advisors to, inform Parent of the terms and
conditions of such Superior Proposal, and the identity of the Person making such
Superior Proposal, and the Company shall, and shall cause its financial and
legal advisors to, negotiate with Parent to agree to a modification of the terms
and conditions of this Agreement as would enable the Company to proceed with the
transactions contemplated hereby on such adjusted terms.
(d) Immediately following the purchase of Offer Securities pursuant to
the Offer, the Company shall request each Person which has heretofore executed a
confidentiality agreement in connection with its consideration of acquiring the
Company or any portion thereof to return all confidential information heretofore
furnished to such Person by or on behalf of the Company.
Section 6.7 Notification of Certain Matters. The Company shall give
-------------------------------
prompt notice to Parent, and Parent and Sub shall give prompt notice to the
Company, of the occurrence, or failure to occur, of any event, which occurrence
or failure to occur would be likely to cause any representation or warranty
contained in this Agreement to be untrue in any material respect at any time
from the date of this Agreement to the expiration of the Offer. Each of the
Company and Parent shall give prompt notice to the other party of any notice or
other communication from any third party alleging that the consent of such third
party is or may be required in connection with the transactions contemplated by
this Agreement.
Section 6.8 HSR Act. (a) Each party hereto shall (i) take promptly
-------
all actions necessary to make the filings required of it or any of its
affiliates under any applicable Antitrust Laws in connection with this Agreement
and the transactions contemplated hereby, (ii) comply at the earliest
practicable date with any formal or informal request for additional information
or documentary material received by it or any of its affiliates from any
Antitrust Authority and (iii) cooperate with one another in connection with any
filing under applicable Antitrust Laws and in connection with resolving any
investigation or other inquiry concerning the transactions contemplated by this
Agreement initiated by any Antitrust Authority.
(b) Each party hereto shall use its reasonable best efforts to resolve
such objections, if any, as may be asserted with respect to the transactions
contemplated by this Agreement under any Antitrust Law. Without limiting the
generality of the foregoing, "reasonable best efforts" shall include, without
limitation:
(i) in the case of each of Parent and the Company:
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<PAGE>
(A) filing with the appropriate Antitrust Authorities no later
than the fifth (5th) day following the date hereof a Notification and
Report Form with respect to the transactions contemplated by this
Agreement; and
(B) if Parent or the Company receives a formal request for
information and documents from an Antitrust Authority, substantially
complying with such formal request within 60 days following the date
of its receipt thereof or such shorter period as is required by
applicable Antitrust Laws; and
(ii) in the case of the Company only, subject to Parent's compliance
with clause (i) above, not frustrating or impeding Parent's strategy or
negotiating positions with any Antitrust Authority, provided that in no
-------- ----
event shall Parent or any of its subsidiaries be required to agree or
commit to divest, hold separate, offer for sale, abandon, limit its
operation of or take similar action with respect to any assets (tangible or
intangible) or any business interest of it or any of its subsidiaries
(including, without limitation, the Surviving Corporation after
consummation of the Offer or the Merger) in connection, with or as a
condition to receiving the consent or approval of, any Antitrust Authority.
(c) Each party hereto shall promptly inform the other parties of any
material communication made to, or received by such party from, any Antitrust
Authority or any other governmental or regulatory authority regarding any of the
transactions contemplated hereby.
Section 6.9 Exon-Florio. The Company and Parent shall, as soon as
-----------
practicable and in any event within five (5) days of the date of this Agreement,
file a voluntary notification pursuant to, and in compliance with, Exon-Florio
and shall use their reasonable best efforts to respond to any inquiries from
governmental officials with respect thereto.
Section 6.10 Employee Benefits. (a) Until the first anniversary of
-----------------
the Effective Time, the Surviving Corporation shall ensure that all employees
and officers of the Company receive benefits that, taken as a whole, are not
materially less favorable in the aggregate to the benefits received by such
individuals immediately prior to the date hereof under applicable Employee
Benefit Plans (other than any Employee Benefit Plan providing for stock based
compensation or benefits).
(b) Notwithstanding anything in this Agreement to the contrary, from
and after the Effective Time, the Surviving Corporation shall have sole
discretion over the hiring, promotion, retention, termination and other terms
and conditions of the employment of the employees of the Surviving Corporation
consistent with applicable law. With respect to each employee benefit plan (as
defined in Section 3(3) of ERISA) or similar policy or program provided by the
Surviving Corporation to employees of the Company (the "Surviving Corporation
---------------------
Plans"), for purposes of determining eligibility to participate, vesting and
- -----
entitlement to benefits (including severance benefits and vacation entitlement,
but not for accrual of pension benefits), service with the Company (or
predecessor employers to the extent the Company provides past service credit)
shall be treated as service with the Surviving Corporation (except to the extent
such recognition would result in duplication of benefits). Such service shall
also apply for purposes of satisfying any waiting periods, evidence of
insurability requirements or the application
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of any pre-existing condition limitations. Employees of the Company shall be
given credit for amounts paid under a corresponding welfare benefit plan during
the same period for purposes of applying deductibles, co-payments and out-of-
pocket maximums as though such amounts had been paid in accordance with the
terms of the applicable Surviving Corporation Plan. Except as otherwise provided
in this Section 6.10, nothing herein shall prevent Parent or the Surviving
Corporation from amending or terminating any Employee Benefit Plan in accordance
with its terms. At the Effective Time, the Surviving Corporation shall assume
and honor, or cause the applicable Subsidiary to assume and honor, in accordance
with their terms (i) all employment, severance and each other compensation
agreement and arrangement existing prior to the execution of this Agreement
which are between the Company or any Subsidiary and any director, officer or
employee thereof and (ii) all collective bargaining agreements or shop
agreements or other arrangements with unions, workers councils or similar
organizations. The Company and Parent agree that the consummation of the offer
shall constitute a "change in control" for purposes of all Employee Benefit
Plans which contain such provisions, as more particularly listed on Schedule
4.10(xii) of the Company Disclosure letter.
(c) Parent shall, as soon as practicable after the Effective Date,
commence the implementation of a stock incentive plan pursuant to which certain
employees of Parent and the Surviving Corporation will be granted, on an annual
basis, stock options entitling the holders thereof to receive, in the aggregate,
upon exercise thereof pursuant to the terms and conditions of such stock
incentive plan, 1.4% of the shares of common stock of Parent issued and
outstanding as of the first day of the fiscal year of Parent during which such
grant was made, provided, that nothing herein shall obligate Parent to structure
-------- ----
such stock incentive plan in a manner which would obligate it to any disclosure
requirement under the Securities Act, the Exchange Act or the rules and
regulations promulgated thereunder, other than as may be required by Rule 12g3-
2(b) under the Exchange Act.
Section 6.11 Directors' and Officers' Insurance. (a) The
----------------------------------
certificate of incorporation and the by-laws of the Surviving Corporation shall
contain the provisions with respect to indemnification and exculpation from
liability set forth in the Company's Certificate of Incorporation and By-Laws on
the date of this Agreement, which provisions shall not be amended, repealed or
otherwise modified for a period of six years from the Effective Time in any
manner that would adversely affect the rights thereunder of individuals who on
or prior to the Effective Time were directors, officers, employees or agents of
the Company (the "Indemnified Parties"), unless such modification is required by
-------------------
law.
(b) For a period of six years from the Effective Time, the Surviving
Corporation shall either (x) maintain in effect the Company's current directors'
and officers' liability insurance covering the Indemnified Parties; provided,
--------
however, that in no event shall Parent be required to expend in any one year an
- -------
amount in excess of 125% of the annual premiums currently paid by the Company
for such insurance which the Company represents to be $694,000 for the twelve
month period ending on December 31, 1999; provided further that if the annual
-------- -------
premiums of such insurance coverage exceed such amount, the Surviving
Corporation shall be obligated to obtain a policy with the greatest coverage
available for a cost not exceeding such amount; provided further that the
-------- -------
Surviving Corporation may substitute for such Company policies policies
providing at least the same coverage and containing terms and conditions which
are no less
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advantageous provided that said substitution does not result in any gaps or
lapses in coverage with respect to matters occurring prior to the Effective Time
or (y) cause the Parent's directors' and officers' liability insurance then in
effect to cover the Indemnified Parties with respect to those matters covered by
the Company's directors' and officers' liability policy.
(c) The Surviving Corporation shall indemnify all Indemnified Parties
to the fullest extent permitted by applicable law with respect to all acts and
omissions arising out of such individuals' services as officers, directors,
employees or agents of the Company or any of its Subsidiaries or as trustees or
fiduciaries of any plan for the benefit of employees of the Company or any of
its Subsidiaries occurring prior to the Effective Time including, without
limitation, the transactions contemplated by this Agreement. Without limitation
of the foregoing, in the event any such Indemnified Party is or becomes involved
in any capacity in any action, proceeding or investigation in connection with
any matter, including without limitation, the transactions contemplated by this
Agreement, occurring prior to, and including, the Effective Time, the Surviving
Corporation, from and after the Effective Time, shall pay, as incurred, such
Indemnified Party's reasonable legal and other expenses (including the cost of
any investigation and preparation) incurred in connection therewith. Subject to
Section 6.11(d) below, the Surviving Corporation shall pay all reasonable
expenses, including attorneys' fees, that may be incurred by any Indemnified
Party in enforcing this Section 6.11 or any action involving an Indemnified
Party resulting from the transactions contemplated by this Agreement.
(d) Any Indemnified Party wishing to claim indemnification under
paragraph (a) or (c) of this Section 6.11, upon learning of any such claim,
action, suit, proceeding or investigation, shall promptly notify the Surviving
Corporation thereof. In the event of any such claim, action, suit, proceeding
or investigation (whether arising before or after the Effective Time), (i) the
Surviving Corporation shall have the right, from and after the Effective Time,
to assume the defense thereof (with counsel engaged by the Surviving Corporation
to be reasonably acceptable to the relevant Indemnified Party), and the
Surviving Corporation shall not be liable to such Indemnified Party for any
legal expenses of other counsel or any other expenses subsequently incurred by
such Indemnified Party in connection with the defense thereof, (ii) such
Indemnified Party will cooperate in the defense of any such matter and (iii) the
Surviving Corporation shall not be liable for any settlement effected without
its prior written consent; provided, that the Surviving Corporation shall not
-------- ----
have any obligation hereunder to any Indemnified Party when and if a court of
competent jurisdiction shall ultimately determine, and such determination shall
have become final, that the indemnification of such Indemnified Party in the
manner contemplated hereby is prohibited by applicable law.
(e) In the event Parent or Sub or the Surviving Corporation or any of
their successors or assigns (i) consolidates with or merges into any other
Person and shall not be the continuing or surviving corporation or entity of
such consolidation or merger, or (ii) transfers or conveys all or substantially
all of its properties and assets to any Person, then, and in each such case, to
the extent necessary to effectuate the purposes of this Section 6.11, proper
provision shall be made so that the successors and assigns of Parent, Sub or the
Surviving Corporation, as the case may be, assume the obligations set forth in
this Section 6.11.
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<PAGE>
Section 6.12 Rights Agreement. Except to the extent permitted in
----------------
accordance with Section 6.6 hereof, the Company shall not (i) redeem the Rights,
(ii) amend (other than to delay the Distribution Date (as defined therein) or to
render the Rights inapplicable to the Offer and the Merger) or terminate the
Rights Agreement prior to the Effective Time without the consent of Parent,
unless required to do so by a court of competent jurisdiction or (iii) take any
action which would allow any Person (as such term is defined in the Rights
Agreement) other than Parent or Sub to be the Beneficial Owner (as such term is
defined in the Rights Agreement) of 15% or more of the Common Stock without
causing a Distribution Date (as such term is defined in the Rights Agreement) or
a Triggering Event (as such term is defined in the Rights Agreement) to occur.
Section 6.13 Public Announcements. Parent and the Company shall
--------------------
obtain the consent of the other party before issuing any press release or
otherwise making any public statements with respect to the transactions
contemplated by this Agreement; provided, however, that a party may, without the
-------- -------
prior consent of the other party, issue such press release or make such public
statement as may be required by law or any listing agreement with a national
securities exchange or automated quotation system which Parent or the Company is
a party to, so long as it has used its reasonable best efforts to consult with
the other party prior to issuing such press release or making such public
disclosure.
Section 6.14 Transfer Tax. The Company and Parent shall cooperate in
------------
the preparation, execution and filing of all returns, questionnaires,
applications or other documents regarding any real property transfer or gains,
sales, use, transfer, value added, stock transfer and stamp taxes, any transfer,
recording, registration and other fees and any similar taxes which become
payable in connection with the transactions contemplated by this Agreement
(together with any related interest, penalties or additions to tax, "Transfer
--------
Taxes"). All Transfer Taxes shall be paid by the Company and expressly shall
- -----
not be a liability of any holder of Offer Securities.
Section 6.15 U.S. Real Property Holding Corporation Status. During
---------------------------------------------
the period commencing on the date hereof until the Offer, the Company shall use
its reasonable best efforts to determine whether it is a "United States real
property holding corporation" within the meaning of Section 897(c)(2) of the
Code and the rules and regulations promulgated thereunder. Prior to (but in no
event more than 30 days before) any payment by Parent or Sub for the Offer
Securities pursuant to the Offer, (i) if the Company determines that it is not a
"United States real property holding corporation," the Company shall prepare and
deliver to Parent and Sub a statement in accordance with Treasury Regulations
Sections 1.1445-2(c)(3) and 1.897-2(h) certifying that the Company is not, and
has not been during the past five years, a "United States real property holding
corporation" for Federal income tax purposes and (ii) if the Company has not
made such a determination, the Company shall notify Parent and Sub that the
statement described in (i) above will not be prepared or delivered.
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ARTICLE VII
CONDITIONS PRECEDENT TO OBLIGATIONS OF PARENT AND SUB
-----------------------------------------------------
Section 7.1 Conditions Precedent to Obligations of Parent and Sub.
-----------------------------------------------------
The respective obligations of Parent and Sub to effect the Merger are subject to
the satisfaction or waiver (subject to applicable law), at or prior to the
Effective Time, of each of the following conditions:
(a) Approval of Company's Stockholders. To the extent required by
----------------------------------
applicable law, this Agreement and the Merger shall have been approved and
adopted by holders of a majority of the Common Stock, the Series A Preferred
Stock and the Series B Preferred Stock (voting as one class, with each share of
such capital stock having one (1) vote) in accordance with applicable law, the
Company's Certificate of Incorporation, the Certificate of Designation of the
Series B Preferred Stock, the Certificate of Designation of the Series A
Preferred Stock and the Company's By-Laws;
(b) Injunction. No preliminary or permanent injunction or other
----------
order shall have been issued by any federal, state or foreign court or by any
federal, state or foreign governmental or regulatory agency, body or authority
and be in effect at the Effective Time which prohibits, restrains, restricts or
enjoins the consummation of the Merger, provided, however, that, in the case of
-------- -------
a decree, injunction or other order, each of the parties shall have used
reasonable best efforts to prevent the entry of any such injunction or other
order and to appeal as promptly as possible any such decree, injunction or other
order that may have been rendered;
(c) Statutes. No federal, state or foreign statute, rule,
--------
regulation, executive order, decree or order of any kind shall have been
enacted, entered, promulgated or enforced by any court or governmental authority
which prohibits, restrains, restricts or enjoins the Merger or has the effect of
making the Merger illegal; and
(d) Minimum Condition. Sub shall have purchased shares of Offer
-----------------
Securities pursuant to the Offer in a number sufficient to satisfy the Minimum
Condition.
ARTICLE VIII
CONDITIONS PRECEDENT TO OBLIGATIONS OF THE COMPANY
--------------------------------------------------
Section 8.1 Conditions Precedent to Obligations of the Company. The
--------------------------------------------------
obligations of the Company to effect the Merger is subject to the satisfaction
or waiver (subject to applicable law), at or prior to the Effective Time, of
each of the following conditions:
(a) Approval of Company's Stockholders. To the extent required by
----------------------------------
applicable law, this Agreement and the Merger shall have been approved and
adopted by holders of a majority of the Common Stock, the Series A Preferred
Stock and the Series B Preferred Stock (voting as one class, with each share of
such capital stock having one (1) vote) in accordance with applicable law, the
Company's Certificate of Incorporation, the Certificate of Designation of the
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Series B Preferred Stock, the Certificate of Designation of the Series A
Preferred Stock and the Company's By-Laws;
(b) Injunction. No preliminary or permanent injunction or other
----------
order shall have been issued by any federal, state or foreign court or by any
federal, state or foreign governmental or regulatory agency, body or authority
and be in effect at the Effective Time which prohibits, restrains, restricts or
enjoins the consummation of the Merger; provided, however, that, in the case of
-------- -------
a decree, injunction or other order, each of the parties shall have used
reasonable best efforts to prevent the entry of any such injunction or other
order and to appeal as promptly as possible any such decree, injunction or other
order that may have been rendered;
(c) Statutes. No federal, state or foreign statute, rule,
--------
regulation, executive order, decree or order of any kind shall have been
enacted, entered, promulgated or enforced by any court or governmental authority
which prohibits restrains, restricts or enjoins the Merger or has the effect of
making the Merger illegal; and
(d) Minimum Condition. Sub shall have purchased shares of Offer
-----------------
Securities pursuant to the Offer in a number sufficient to satisfy the Minimum
Condition.
ARTICLE IX
TERMINATION AND ABANDONMENT
---------------------------
Section 9.1 Termination. This Agreement may be terminated and the
-----------
transactions contemplated hereby may be abandoned, at any time prior to the
Effective Time, whether before or after approval of the Merger by the Company's
stockholders:
(a) by mutual consent of the Company, on the one hand, and of Parent
and Sub, on the other hand; provided, however, that after consummation of
the Offer, the consent of a majority of the Independent Directors shall
also be required to terminate this Agreement pursuant to this clause (a);
(b) by either Parent, on the one hand, or the Company, on the other
hand, if any statute, rule or regulation shall have been promulgated which
prohibits the consummation of the Offer or the Merger or if any order or
injunction of a court of competent jurisdiction which prohibits
consummation of the Offer or the Merger shall have become final and
nonappealable;
(c) by either Parent, on the one hand, or the Company, on the other
hand, if the Offer shall have expired without any Offer Securities being
purchased pursuant thereto as a result of the failure to meet any one or
more of the Tender Offer Conditions, provided, however, that the right to
terminate this Agreement under this clause (c) shall not be available (i)
to the Company if this Agreement may be terminated by Parent pursuant to
Section 9.1(d) hereof and (ii) to Parent if this Agreement may be
terminated by the Company pursuant to Section 9.1(g) hereof;
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<PAGE>
(d) by Parent, in the event of, at any time prior to consummation of
the Offer, a breach by the Company of any representation, warranty,
covenant or agreement contained in this Agreement which, if uncured, would
give rise to the failure of a condition set forth in clause (v)(e) or (f)
of Annex A, and such breach is incapable of being cured or, if capable of
being cured, has not been cured within fifteen (15) business days following
receipt by the Company of written notice of such breach from Parent and has
not been waived by Parent pursuant to the provisions hereof;
(e) (i) by Parent if, at any time prior to consummation of the Offer,
(A) the Company shall have (w) entered into any agreement, arrangement or
understanding with respect to any Acquisition Proposal, (x) withdrawn or
modified, or proposed to withdraw or modify, in a manner adverse to Parent
or Sub, the approval and recommendation of the Offer and this Agreement, or
(y) approved or recommended, or proposed to approve or recommend, any
Acquisition Proposal or (z) announced a neutral position with respect to
any Acquisition Proposal and does not reject or recommend such Acquisition
Proposal within three (3) business days of the announcement of such neutral
position, (B) the Company's Board of Directors or any committee thereof
shall have failed to reaffirm its approval and recommendation of the Offer,
the Merger and the Merger Agreement within three (3) business days of
Parent's request for such reaffirmation, or (C) the Company or the
Company's Board of Directors or any committee thereof shall have resolved
to do any of the foregoing or (ii) by the Company if, at any time prior to
consummation of the Offer, the Company shall have entered into an agreement
to effect a Superior Proposal and the entering into of such agreement is
permitted in accordance with Section 6.6 and the fees payable by the
Company to Parent pursuant to Section 10.1(b) are paid simultaneously with
such termination.
(f) by Parent, if the Minimum Condition shall not have been satisfied
by the expiration date of the Offer and on or prior to such date a third
party shall have made or caused to be made a proposal, or public
announcement of a proposal, to the Company or its stockholders with respect
to (A) the acquisition of the Company by merger, tender offer or otherwise;
(B) a merger, consolidation or similar business combination with the
Company or any of its Subsidiaries; (C) the acquisition of 20% or more of
the assets of the Company and its Subsidiaries, taken as a whole; (D) the
acquisition of 20% or more of the Common Stock Equivalents of the Company
or (E) the adoption by the Company of a plan of liquidation or the
declaration or payment of an extraordinary dividend (any of the proposed
transactions enumerated in clauses (A) through (E), an "Alternative
-----------
Proposal");
--------
(g) by the Company, in the event of, at any time prior to consummation
of the Offer, (i) a breach by Parent or Sub of any representation or
warranty contained in this Agreement which, if uncured, would result in any
such representation or warranty that is qualified as to materiality being
untrue or incorrect in any respect or in any such representation or
warranty that is not so qualified being untrue or incorrect in any material
respect, in each case as of the date of the consummation of the Offer as
though made on or as of such date, except (x) for changes specifically
permitted by the Merger Agreement and (y) that, to the extent such
representations and warranties address matters only as of a particular
date, such representations and warranties shall, to such extent, be true
and
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<PAGE>
correct at and as of such particular date as if made at and as of such
particular date or (ii) Parent or Sub shall have failed to perform in all
material respects any obligation or to comply in any material respect with
any agreement or covenant of Parent or Sub to be performed or complied with
by it under this Agreement, and, in the case of either clause (i) or (ii),
such breach or failure is incapable of being cured or, if capable of being
cured, has not been cured within fifteen (15) business days following
receipt by Parent of written notice of such breach from the Company or has
not been waived by the Company pursuant to the provisions hereof;
(h) by the Company, if Parent or Sub shall have failed to commence the
Offer within six (6) business days following the date of this Agreement;
(i) by Parent, on the one hand, or the Company, on the other hand, if
the acceptance for payment of the Offer Securities shall not have occurred
within one hundred twenty (120) days after commencement of the Offer (the
"Termination Date"), provided, however, that the right to terminate this
-------- -------
Agreement under this clause (i) shall not be available (i) to the Company
if this Agreement may be terminated by Parent pursuant to Section 9.1(d)
hereof or if any of the events set forth in clauses (v) (g) or (h) of Annex
A shall have occurred or an Alternative Proposal shall have been
outstanding at any time during the thirty (30) day period ending prior to
such date of proposed termination and (ii) to Parent if this Agreement may
be terminated by the Company pursuant to Section 9.1(g) hereof.
Section 9.2 Effect of Termination. In the event of the termination
---------------------
of this Agreement pursuant to Section 9.1 hereof by Parent, on the one hand, or
the Company, on the other hand, written notice thereof shall forthwith be given
to the other party or parties specifying the provision hereof pursuant to which
such termination is made (other than termination pursuant to Section 9.1(a)
hereof), and this Agreement shall become void and have no effect, and there
shall be no liability hereunder on the part of Parent, Sub or the Company,
except that Sections 4.16, 5.6, 6.2, 10.1, 10.11 and 10.13 hereof and this
Section 9.2 shall survive any termination of this Agreement. Nothing in this
Section 9.2 shall relieve any party to this Agreement of liability for breach of
this Agreement.
ARTICLE X
MISCELLANEOUS
-------------
Section 10.1 Fees and Expenses. (a) Except as provided in paragraph
-----------------
(b) below and except for damages of one party to this Agreement resulting from a
breach of any term of this Agreement by another party hereto, all costs and
expenses incurred in connection with this Agreement and the consummation of the
transactions contemplated hereby shall be paid by the party incurring such costs
and expenses.
(b) If this Agreement is terminated by (i) Parent or the Company in
accordance with Section 9.1(c) hereof following the occurrence of any of the
events set forth in clauses (v)(g)
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or (h) of Annex A; (ii) Parent or the Company, as the case may be, in accordance
with Section 9.1(e) hereof; (iii) Parent pursuant to Section 9.1(f) if within
nine (9) months of the date of such termination, the Company shall enter into an
agreement with respect to any Acquisition Proposal with any Person or any
Affiliate of such Person who made or caused to be made an Alternative Proposal
prior to the date on which Parent terminated this Agreement pursuant to Section
9.1(f), then the Company shall pay to Parent on the date of such termination
(or, in the case of clause (iii) on the date the Company enters into an
agreement with respect to an Acquisition Proposal) in immediately available
funds an amount equal to $65,000,000 (Sixty-Five Million Dollars).
Section 10.2 Representations and Warranties. The respective
------------------------------
representations and warranties of the Company, on the one hand, and Parent and
Sub, on the other hand, contained herein or in any certificates or other
documents delivered prior to or at the Closing shall not be deemed waived or
otherwise affected by any investigation made by any party. Each and every such
representation and warranty shall expire with, and be terminated and
extinguished by, the Closing and thereafter none of the Company, Parent or Sub
shall be under any liability whatsoever with respect to any such representation
or warranty. This Section 10.2 shall have no effect upon any other obligation
of the parties hereto, whether to be performed before or after the Effective
Time.
Section 10.3 Extension; Waiver. At any time prior to the Effective
-----------------
Time, the parties hereto, by action taken by or on behalf of the Executive Board
of Directors and the respective Boards of Directors of the Company or Sub, may
(i) extend the time for the performance of any of the obligations or other acts
of the other parties hereto, (ii) waive any inaccuracies in the representations
and warranties contained herein by any other applicable party or in any
document, certificate or writing delivered pursuant hereto by any other
applicable party or (iii) waive compliance with any of the agreements or
conditions contained herein. Any agreement on the part of any party to any such
extension or waiver shall be valid only if set forth in an instrument in writing
signed on behalf of such party.
Section 10.4 Notices. All notices, requests, demands, waivers and
-------
other communications required or permitted to be given under this Agreement
shall be in writing and shall be deemed to have been duly given if delivered in
person or mailed, certified or registered mail with postage prepaid, or sent by
telex, telegram or telecopier, as follows:
(a) if to the Company, to it at:
Wang Laboratories, Inc.
290 Concord Road
Billerica, MA 01821-4130
Attention: Albert A. Notini, Executive Vice President
Facsimile: (978) 625-5055
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<PAGE>
with a copy (which shall not constitute notice) to:
Skadden, Arps, Slate, Meagher & Flom LLP
One Beacon Street
Boston, Massachusetts 02108-3194
Attention: David Brewster, Esq.
Facsimile: (617) 573-4862
(b) if to either Parent or Sub, to it at:
Getronics NV
Donauweg 10
P.O. Box 652
1000 AR Amsterdam
The Netherlands
Attention: Jan Docter, Chief Financial Officer
Facsimile: 011 31 20 586-1513
with a copy (which shall not constitute notice) to:
White & Case LLP
1155 Avenue of the Americas
New York, New York 10036
Attention: John M. Reiss, Esq.
Facsimile: (212) 354-8113
or to such other Person or address as any party shall specify by notice in
writing to each of the other parties. All such notices, requests, demands,
waivers and communications shall be deemed to have been received on the date of
delivery unless if mailed, in which case on the third (3rd) business day after
the mailing thereof except for a notice of a change of address, which shall be
effective only upon receipt thereof.
Section 10.5 Entire Agreement. This Agreement and the annex,
----------------
schedules and other documents referred to herein or delivered pursuant hereto,
collectively contain the entire understanding of the parties hereto with respect
to the subject matter contained herein and supersede all prior agreements and
understandings, oral and written, with respect thereto, other than the
Confidentiality Agreement.
Section 10.6 Binding Effect; Benefit; Assignment. This Agreement
-----------------------------------
shall inure to the benefit of and be binding upon the parties hereto and, with
respect to the provisions of Section 6.11 hereof, shall inure to the benefit of
the Persons or entities benefiting from the provisions thereof who are intended
to be third-party beneficiaries thereof and their respective successors and
permitted assigns, but neither this Agreement nor any of the rights, interests
or obligations hereunder shall be assigned by any of the parties hereto without
the prior written consent of the other parties, except that Sub may assign and
transfer its right and obligations hereunder to any of its Affiliates. Except
as provided in the immediately preceding sentence, nothing in this Agreement,
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expressed or implied, is intended to confer on any Person other than the parties
hereto or their respective successors and permitted assigns, any rights,
remedies, obligations or liabilities under or by reason of this Agreement.
Section 10.7 Amendment and Modification. Subject to applicable law,
--------------------------
this Agreement may be amended, modified and supplemented in writing by the
parties hereto in any and all respects before the Effective Time
(notwithstanding any stockholder approval), by action taken by the Executive
Board of Parent and the respective Boards of Directors of Sub and the Company or
by the respective officers authorized by such Executive Board or Boards of
Directors, provided, however, that after any such stockholder approval, no
-------- -------
amendment shall be made which by law requires further approval by such
stockholders without such further approval.
Section 10.8 Further Actions. Each of the parties hereto agrees
---------------
that, subject to its legal obligations, it will use its reasonable best efforts
to fulfill all conditions precedent specified herein, to the extent that such
conditions are within its control, and to do all things reasonably necessary to
consummate the transactions contemplated hereby.
Section 10.9 Headings. The descriptive headings of the several
--------
Articles and Sections of this Agreement are inserted for convenience only, do
not constitute a part of this Agreement and shall not affect in any way the
meaning or interpretation of this Agreement.
Section 10.10 Counterparts. This Agreement may be executed in
------------
several counterparts, each of which shall be deemed to be an original, and all
of which together shall be deemed to be one and the same instrument.
Section 10.11 APPLICABLE LAW. THIS AGREEMENT AND THE LEGAL RELATIONS
--------------
BETWEEN THE PARTIES HERETO SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH
THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD TO THE CONFLICT OF LAWS RULES
THEREOF; PROVIDED, HOWEVER, THAT ANY OF THE PROVISIONS CONTAINED HEREIN WITH
-------- -------
REGARD TO THE MERGER SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE
LAWS OF THE STATE OF DELAWARE, WITHOUT REGARD TO THE CONFLICT OF LAWS RULES
THEREOF. THE STATE OR FEDERAL COURTS LOCATED WITHIN THE COUNTY OF NEW YORK OF
THE STATE OF NEW YORK WILL HAVE JURISDICTION OVER ANY AND ALL DISPUTES BETWEEN
THE PARTIES HERETO, WHETHER IN LAW OR EQUITY, ARISING OUT OF OR RELATING TO THIS
AGREEMENT AND THE AGREEMENTS, INSTRUMENTS AND DOCUMENTS CONTEMPLATED HEREBY AND
THE PARTIES CONSENT TO AND AGREE TO SUBMIT TO THE JURISDICTION OF SUCH COURTS.
EACH OF THE PARTIES HEREBY WAIVES AND AGREES NOT TO ASSERT IN ANY SUCH DISPUTE,
TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY CLAIM THAT (I) SUCH PARTY
IS NOT PERSONALLY SUBJECT TO THE JURISDICTION OF SUCH COURTS, (II) SUCH PARTY
AND SUCH PARTY'S PROPERTY IS IMMUNE FROM ANY LEGAL PROCESS ISSUED BY SUCH COURTS
OR (III) ANY LITIGATION OR OTHER PROCEEDING COMMENCED IN SUCH COURTS IS BROUGHT
IN AN INCONVENIENT FORUM.
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Section 10.12 Severability. If any term, provision, covenant or
------------
restriction contained in this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void, unenforceable or against
its regulatory policy, the remainder of the terms, provisions, covenants and
restrictions contained in this Agreement shall remain in full force and effect
and shall in no way be affected, impaired or invalidated.
Section 10.13 Waiver of Jury Trial. Each of the parties to this
--------------------
Agreement hereby irrevocably waives all right to a trial by jury in any action,
proceeding or counterclaim arising out of or relating to this Agreement or the
transactions contemplated hereby.
[SIGNATURE PAGE FOLLOWS]
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<PAGE>
IN WITNESS WHEREOF, each of Parent, Sub and the Company have caused
this Agreement to be executed by their respective officers thereunto duly
authorized, all as of the date first above written.
GETRONICS NV
By /s/ C.G. van Luijk
---------------------------
Name: C.G. van Luijk
Title: Chief Executive Officer
GETRONICS ACQUISITION, INC.
By /s/ C.G. van Luijk
---------------------------
Name: C.G. van Luijk
Title: President
WANG LABORATORIES, INC.
By /s/ Joseph Tucci
---------------------------
Name: Joseph Tucci
Title: Chairman and Chief Executive Officer
-53-
<PAGE>
ANNEX A
-------
The capitalized terms used in this Annex A shall have the meanings set
forth in the Agreement to which it is annexed, except that the term "Merger
Agreement" shall be deemed to refer to the Agreement to which this Annex A is
appended and "Purchaser" shall be deemed to refer to Sub.
Conditions to the Offer. Notwithstanding any other provision of the
-----------------------
Offer or the Merger Agreement, 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 Purchaser's
obligation to pay for or return tendered shares promptly after termination or
withdrawal of the Offer), pay for any Offer Securities tendered pursuant to the
Offer and may terminate the Offer and may postpone the acceptance of, and
payment for, any Offer Securities if (i) there shall not have been validly
tendered and not properly withdrawn prior to the expiration of the Offer, Offer
Securities which represent at least a majority of all of the Common Stock
Equivalents on the date of purchase (the "Minimum Condition"), (ii) any
applicable waiting period (and any extension thereof) under the HSR Act shall
not have expired or been terminated, prior to the expiration of the Offer, (iii)
a decision of the Commission of the European Communities that the purchase of
the Offer Securities pursuant to the Offer and the Merger are compatible with
the common market shall not have been received prior to the expiration of the
Offer, (iv) any applicable waiting period under Exon-Florio shall not have
expired or been terminated prior to the expiration of the Offer or (v) if, at
any time after the date of the Merger Agreement and at or before the time of
payment for any such Offer Securities (whether or not any Offer Securities have
theretofore been accepted for payment or paid for pursuant to the Offer), any of
the following shall occur:
(a) there shall be instituted or pending any action or proceeding by
any government or any governmental authority or agency, domestic or
foreign, or by any other Person, domestic or foreign, before any court of
competent jurisdiction or governmental authority or agency, domestic or
foreign, which could reasonably be expected to (i) make illegal, or
directly or indirectly prohibit or make materially more costly the Offer or
the Merger or result in material damages, (ii) result in a prohibition or
material limitation on the ownership or operation by Parent or Purchaser of
all or any material portion of the business or assets of the Company and
its Subsidiaries taken as a whole or compel Parent or Purchaser to dispose
of or hold separately all or any material portion of the business or assets
of Parent and its Subsidiaries taken as a whole or the Company and its
Subsidiaries taken as a whole, or impose any material limitation on the
ability of Parent or Purchaser to conduct its business or own such assets,
(iii) result in an imposition of limitations on the ability of Parent or
Purchaser effectively to exercise full rights of ownership of the Offer
Securities including, without limitation, the right to vote any Offer
Securities acquired or owned by Purchaser or Parent on all matters properly
presented to the Company's stockholders or (iv) a requirement of
divestiture by Parent or Purchaser of any Offer Securities;
(b) there shall be any action taken, or any statute, rule, regulation,
legislation, interpretation, judgment, order or injunction proposed,
enacted, enforced, promulgated, amended or issued and applicable to or
deemed applicable to (i) Parent, Purchaser, the Company or any Subsidiary
of the Company or (ii) the Offer or the Merger, by any
<PAGE>
Annex A
Page 2
legislative body, court, government or governmental, administrative or
regulatory authority or agency, domestic or foreign, other than the routine
application of the waiting period provisions of the HSR Act or Exon-Florio
or the notification and reporting requirements under EU Antitrust Laws (in
each case with respect to the Offer or to the Merger), that could
reasonably be expected to result directly or indirectly, in any of the
consequences referred to in paragraph (a) above;
(c) there shall have occurred any event, change, occurrence, effect,
fact or circumstance which has or could reasonably be expected to have, a
Material Adverse Effect or a Performance Material Adverse Effect on the
Company;
(d) there shall have occurred (i) any general suspension of trading
in, or limitation on prices for, securities on any U.S. securities
exchange, in any U.S. over-the-counter market or the Amsterdam Stock
Exchange for a period in excess of 12 hours (excluding any coordinated
trading halt triggered solely as a result of a specified decrease in a
market index), (ii) any decline in the Morgan Stanley World Index in excess
of 23% measured from the close of business on the trading day next
preceding the date of the Merger Agreement, (iii) a declaration of a
banking moratorium or any suspension of payments in respect of banks in the
United States or any other jurisdiction in which any bank or other
financial institution in any manner involved with the financing of the
Offer or the Merger is incorporated; or (iv) any material limitation
(whether or not mandatory) by any Federal, state or foreign governmental
authority or agency on, the extension of credit by banks or other lending
institutions which materially and adversely affects the ability of Parent
to obtain the financing necessary to effect the Offer or the Merger;
(e) any of the representations or warranties made by the Company in
the Merger Agreement that are qualified as to materiality shall be untrue
or incorrect in any respect or any such representations and warranties that
are not so qualified shall be untrue or incorrect in any material respect,
in each case as of the date of the consummation of the Offer as though made
on or as of such date, except (i) for changes specifically permitted by the
Merger Agreement and (ii) that to the extent such representations and
warranties address matters only as of a particular date, such
representations and warranties shall, to such extent, be true and correct
at and as of such particular date as if made at and as of such particular
date;
(f) the Company shall have failed to perform in any material respect
any obligation or to comply in any material respect with any agreement or
covenant of the Company to be performed or complied with by it under this
Agreement on or prior to the date of the consummation of the Offer;
(g) the Company's Board of Directors or any committee thereof shall
have withdrawn, or modified or proposed to withdraw or modify, in a manner
adverse to Parent or Purchaser, the approval and recommendation of the
Offer and this Agreement, or approved or recommended, or proposed to
approve or recommend, any Acquisition Proposal, or announced a neutral
position with respect to any Acquisition Proposal and does not reject or
recommend such Acquisition Proposal within three (3) business days of
<PAGE>
Annex A
Page 3
the announcement of such neutral position or, upon request by Parent, shall
have failed to reaffirm its approval and recommendation of the Offer, the
Merger and the Merger Agreement within three (3) business days of the
Purchaser's request for such affirmation or shall have resolved to do any
of the foregoing;
(h) beneficial ownership (determined for the purposes of this
paragraph (h) as set forth in Rule 13d-3 promulgated under the Exchange
Act) of 20% or more of the capital stock of the Company shall have been
acquired by any Person or group (as defined in Section 13(d)(3) under the
Exchange Act); or
(i) the Merger Agreement shall have been terminated in accordance with
its terms.
The foregoing conditions are for the sole benefit of Parent and the
Purchaser and may be asserted by Parent or the Purchaser, or may be waived by
Parent or the Purchaser (except for the Minimum Condition), in whole or in part
at any time and from time to time in their respective 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 and each such right shall
be deemed an ongoing right which may be asserted at any time and from time to
time.
<PAGE>
EXHIBIT (g)(1)
Consolidated income statement
(in thousands of Dutch guilders)
<TABLE>
<CAPTION>
-------------------------- --------------------------
1998 1997
-------------------------- --------------------------
<S> <C> <C> <C> <C>
Net sales 3,459,228 2,776,509
Cost of sales 1,811,613 1,538,655
--------- ---------
Gross profit 1,647,615 1,237,854
- ----------------------------------------------------------------------------------------
Operating expenses
Personnel costs 985,989 729,022
Depreciation of tangible
fixed assets 50,525 41,961
Other operating expenses 291,824 230,395
--------- ---------
1,328,338 1,001,378
--------- ---------
Operating result 319,277 236,476
- ----------------------------------------------------------------------------------------
Financial income and expense
Result from investments 2 2,931
Net interest income 7,354 11,795
--------- ---------
7,356 14,726
--------- ---------
Earnings on ordinary
activities before taxes 326,633 251,202
Income taxes 85,651 68,951
--------- ---------
Earnings on ordinary activities
after taxes 240,982 182,251
Extraordinary income after taxes 12,078 1,946
Minority interests 12,821 4,173
--------- ---------
Net earnings 240,239 180,024
- ----------------------------------------------------------------------------------------
-------------------------- --------------------------
</TABLE>
36 Getronics
<PAGE>
Consolidated balance sheet as at December 31
(in thousands of Dutch guilders, after proposed profit distribution)
<TABLE>
<CAPTION>
-------------------------- -----------------------
1998 1997
-------------------------- -----------------------
<S> <C> <C> <C> <C>
Fixed assets
Tangible fixed assets 171,421 114,129
Financial fixed assets 6,545 5,923
--------- -------
Total fixed assets 177,966 120,052
Current assets
Inventories 179,446 162,189
Accounts receivable 746,191 586,126
Securities 16,291 7,683
Cash 272,382 148,440
--------- -------
Total current assets 1,214,310 904,438
Current liabilities 868,054 737,738
--------- -------
Working capital 346,256 166,700
--------- ---------
Total capital employed 524,222 286,752
- ----------------------------------------------------------------------------------------
Financed by:
Long-term debt 22,253 11,470
Provisions 118,132 121,119
Group equity
Issued and paid-up capital 22,511 21,910
Share premium reserve 255,064 74,847
Other reserves 86,562 48,118
--------- -------
Shareholders' equity 364,137 144,875
Minority interests 19,700 9,288
--------- -------
383,837 154,163
--------- ---------
Total financing 524,222 286,752
- ----------------------------------------------------------------------------------------
Total assets 1,392,276 1,024,490
- ----------------------------------------------------------------------------------------
-------------------------- -----------------------
</TABLE>
Getronics 37
<PAGE>
Consolidated cash flow statement
(in thousands of Dutch guilders)
<TABLE>
<CAPTION>
-------------------------- --------------------------
1998 1997
-------------------------- --------------------------
<S> <C> <C> <C> <C>
Cash flow from operations
Operating result 319,277 236,476
Depreciation of tangible fixed assets 50,525 41,961
Increase in working capital (1) -43,586 -114,672
Decrease in provisions -17,131 -5,758
------- -------
309,085 158,007
------- -------
Result from investments 2 2,931
Net interest income 7,354 11,795
Taxes on earnings on ordinary activities -85,651 -68,951
Extraordinary income after taxes -- 1,946
------- -------
-78,295 -52,279
------- -------
Cash flow from operations 230,790 105,728
- ----------------------------------------------------------------------------------------------------------
Cash flow from capital expenditure
Acquisition of Group companies -146,073 -283,954
Additions to tangible fixed assets -83,991 -61,006
Additions to financial fixed assets -1,940 -2,867
Disposals of tangible fixed assets 3,731 5,227
Disposals of financial fixed assets 1,517 566
------- -------
Cash flow from capital expenditure -226,756 -342,034
- ----------------------------------------------------------------------------------------------------------
Cash flow from financing activities
Decrease/Increase in long-term debt -7,092 8,366
Share issues 180,818 6,025
Prior-year dividend settlement -9,028 366
Reserve for cash dividend for the year -20,000 -6,000
Decrease/Increase in amounts owed
to credit institutions -12,884 28,357
Minority interests -1,447 -1,444
Exchange rate differences on
equity of group companies -1,851 -655
------- -------
Cash flow from financing activities 128,516 35,015
- ----------------------------------------------------------------------------------------------------------
Increase/Decrease in cash 132,550 -201,291
- ----------------------------------------------------------------------------------------------------------
-------------------------- --------------------------
</TABLE>
1) Working capital is defined as inventories plus accounts receivable minus
current liabilities (excluding credit institutions).
38 Getronics
<PAGE>
Notes to the consolidated financial statements
Accounting policies
The consolidated financial statements have been drawn up in conformity
with the provisions of Part 9, Book 2 of the Netherlands Civil Code. In
view of ongoing internationalization application of all of the accounting
policies and regulations according to International Accounting Standards
is to be considered in the next few years.
Consolidation principles
The Group accounts include the accounts of Getronics NV and its group
companies, as well as of investments in which Getronics NV holds, either
directly or indirectly, 50% or more of the issued share capital. The
financial data of the group companies and investments are fully included
in the consolidated financial statements; the minority interests are shown
separately. The financial information of companies acquired during the
year under review is included from the effective date of acquisition. The
investments which will be disposed of or whose activities will be
terminated in full or for the greater part, or will be disposed of, have
been left out of the Group accounts. The corporate financial statements
have been prepared in accordance with the provisions laid down in section
402, Part 9, Book 2 of the Netherlands Civil Code. Balance sheet items
relating to group companies expressed in foreign currencies are translated
into Dutch guilders at the exchange rate prevailing on the balance sheet
date. Exchange rate differences relating to the shareholders' equity of
group companies are charged or credited to shareholders' equity. Income
statement items are translated into Dutch guilders at the average exchange
rate calculated for the year under review. Related exchange rate
differences are charged or credited to shareholders' equity.
Valuation and determination of result
Historical cost The financial accounts are prepared on the basis of the
historical cost concept. Unless indicated otherwise, assets and
liabilities are stated at nominal value less necessary provisions.
Foreign currencies Payables and receivables in foreign currencies are
translated into Dutch guilders at the exchange rate prevailing on the
balance sheet date. Transactions in foreign currencies are converted at
rates that fairly approximate the rate prevailing when the transaction was
performed. Related exchange rate differences are carried to the income
statement.
Goodwill on acquired investments The difference between the acquisition
price and the net asset value on the acquisition of investments valued at
net asset value is charged or credited directly to shareholders' equity.
Income statement
Net sales Net sales reflect proceeds from goods and services provided to
third parties during the year under review. Projects are included in net
sales at the moment of final delivery.
Cost of sales The cost of sales is the average of the historical costs of
the goods and services purchased from third parties. Differences in
exchange rates as well as allocations to the provision for obsolescence
are included.
Financial income and expense The balance of interest income and expense is
presented in the income statement.
Income tax Income tax is calculated, on the basis of the applicable tax
rates, on the earnings before taxes, taking into account exempt profit
components. Timing differences resulting from determination of the result
for tax purposes are added to or deducted from the provision for deferred
taxes. Deferred tax debits have not been valued.
Getronics 39
<PAGE>
Balance sheet
Tangible fixed assets Tangible fixed assets are valued at cost less
accumulated depreciation. Depreciation is calculated according to the
straight-line method, based on the estimated useful lives.
Financial fixed assets Where the company has a significant influence on
financial and business policies, non-consolidated investments are stated
at net asset value. Other investments are stated at cost, taking account
of a lasting impairment in value.
Inventories Inventories are valued at the lower of average cost and market
price, taking into account a normal realizable margin, reduced by
provisions for obsolescence. Work in progress is valued on the basis of
materials used and labor costs less anticipated losses determined on a
project basis and installments billed in advance.
Securities Securities are valued at the lower of acquisition cost and
stock market value. Debentures are stated at nominal value, after
adjustment for the non-amortized part of the premium/discount.
Amortization of the premium/discount is on a straight-line basis for the
remaining life to maturity.
Provisions Provisions are made for risks and liabilities related to
operations. Income from lease contracts is deferred and amortized over the
lease term. A provision is included for repurchase commitments for lease
contracts above residual value. Deferred tax liabilities resulting from
timing differences in the profit determination for the financial
statements and for tax purposes are stated at the rates obtaining in the
country concerned. The warranty provision is formed for providing
additional services and to cover any technical faults relating to goods
and services provided. The pension provision only concerns the
past-service commitments with regard to pensions and other non-activity
plans, determined on an actuarial basis. The actuarial interest rate used
is 4%.
Minority interests The minority interests in the group companies are
valued at the net asset value, determined in accordance with the
accounting policies of these financial statements.
Cash flow statement
The cash flow statement has been drawn up on the basis of the indirect
method. Cash is inclusive of securities, which may be considered to be
investments of a highly marketable nature. The cost at which group
companies were acquired is included under 'cash flow from capital
expenditure', after deduction of available liquid resources. The movements
in assets and liabilities arising from acquisitions have been eliminated
from the cash flows on account of those assets and liabilities. These
movements have been recognized in 'cash flow from capital expenditure'
under 'acquisition of group companies'.
40 Getronics
<PAGE>
Notes to the consolidated income statement
(in thousands of Dutch guilders)
Net sales by geographical area 1998 1997
The Netherlands 2,279,101 2,022,944
Other EU countries 509,230 339,204
Other foreign countries 670,897 414,361
--------- ---------
3,459,228 2,776,509
--------- ---------
Personnel costs 1998 1997
Salaries 638,414 459,106
Social security costs 92,329 61,532
Pension costs 21,627 17,824
Other personnel costs 233,619 190,560
--------- ---------
985,989 729,022
--------- ---------
Salaries include a fixed remuneration for the Supervisory Board of Dfl. 143. The
remuneration, including pension contributions in respect of members and former
members of the Board of Management, which was charged to the result in 1998,
amounts to Dfl. 3,921.
Because of the change to accounting policies concerning the premium transfer
allowance the figures for 1997 have been adjusted to facilitate comparison.
Pre-adjusted salaries and social security costs for 1997 were Dfl. 483,954 and
Dfl. 36,684 respectively.
Other personnel costs also include costs of recruiting and training by third
parties and commuting expenses.
Interest income/expense 1998 1997
Interest income 14,550 14,945
Interest expense -7,196 -3,150
----- ------
Net interest income 7,354 11,795
----- ------
Getronics 41
<PAGE>
Taxes on earnings on ordinary activities
As at year end, the Group had the following deferred tax debits not accounted
for in the balance sheet.
Country Amount Nominal Amortization
rate period
The Netherlands 186,919 35% 3 - 4 1/2 years
The Netherlands 34,000 35% 10 years
Spain 127,442 35% 10 years
Extraordinary income 1998 1997
Extraordinary income 12,078 13,213
Extraordinary expenditure -- -17,335
Taxes on extraordinary items -- 6,068
------ -----
Extraordinary result after taxes 12,078 1,946
------ -----
The extraordinary income concerns the positive effect from the merger between
Ark and Cinet in Norway, which falls under the tax exemption for investments.
The extraordinary expenditure for 1997 concerns the provision for the
millennium issue formed in that year.
Minority interests
As part of the employee participation program, staff and management of Ark can
be granted options on new Ark ASA shares to be issued. The maximum number of
shares to be issued under this program during the period December 1, 1999 to
December 1, 2002, amounts to 1.6 million, which may raise the number of
outstanding Ark ASA shares by a maximum of 8.6%.
Number of employees by geographical area
(average over the year in FTE)
1998 1997
The Netherlands 6,993 6,132
Other EU countries 1,835 552
Other foreign countries 1,216 755
------ -----
10,044 7,439
------ -----
Floor space of office premises and buildings
At the balance sheet date, office premises and buildings owned and rented by the
Group in the Netherlands and abroad totaled 220,434 sq.m. (1997: 178,118 sq.m.)
42 Getronics
<PAGE>
Notes to the consolidated balance sheet as at December 31
(in thousands of Dutch guilders)
Tangible fixed assets Land and Other Total
buildings fixed assets
Cost:
Beginning of year 79,488 278,581 358,069
Additions 21,202 64,131 85,333
Disposals -2,427 -14,410 -16,837
New consolidations 19,620 16,311 35,931
Reclassified 4,588 -4,588 --
Currency translation differences -262 -2,946 -3,208
------- ------- -------
End of year 122,209 337,079 459,288
------- ------- -------
Accumulated depreciation:
Beginning of year 38,021 205,919 243,940
Depreciation 4,613 45,912 50,525
Disposals -1,144 -11,962 -13,106
New consolidations 1,884 6,490 8,374
Reclassified 2,685 -2,685 --
Currency translation differences -100 -1,766 -1,866
------- ------- -------
End of year 45,959 241,908 287,867
------- ------- -------
Book value:
Beginning of year 41,467 72,662 114,129
------- ------- -------
End of year 76,250 95,171 171,421
------- ------- -------
<TABLE>
<CAPTION>
Periods of depreciation:
<S> <C>
- - Building improvements remaining period of the relevant rental
contract and 6 years for buildings owned
- - Buildings 30 years
- - Office furniture and equipment 6 years
- - Computer disaster recovery equipment 5 years or remaining period of the relevant
contract if shorter than 5 years
- - Computer hardware and tools 3 years
- - Computer software bought for
internal use or third parties 2 years
- - In-house developed computer software
for internal use or for third parties charged to the income statement in the
year of production
</TABLE>
Getronics 43
<PAGE>
Financial fixed assets Other Other Total
investments receivables
Beginning of year 2,488 3,435 5,923
Additions 622 1,318 1,940
Disposals -363 -737 -1,100
New consolidations 199 - 199
Currency translation differences -236 -181 -417
------- ----- -------
End of year 2,710 3,835 6,545
------- ----- -------
Inventories 1998 1997
Trade inventories 143,181 139,006
Work in progress 110,305 73,354
Advance payments on work in progress -74,040 -50,171
------- -------
179,446 162,189
------- -------
As from 1998 work in progress is stated before deduction of related advances.
The figures for 1997 have been adjusted to facilitate comparison. Before this
change in presentation work in progress amounted to Dfl. 36,841 and related
advances to Dfl. 13,658.
Accounts receivable 1998 1997
Trade receivables 651,597 489,144
Other receivables and accrued income 94,594 96,982
------- -------
746,191 586,126
------- -------
Securities
Securities represented a value of Dfl. 16,291 (1997: Dfl. 7,755) on December 31,
1998.
Current liabilities 1998 1997
Trade accounts payable 385,745 340,463
Accruals and deferred income 167,377 140,057
Taxes and social security
contributions payable 119,517 111,857
Advance payments received 70,912 49,608
Due to credit institutions 21,564 34,448
Reserve for cash dividend for the year 20,000 6,000
Other liabilities 82,939 55,305
------- -------
868,054 737,738
------- -------
No guarantees of any significance have been given by the Group.
44 Getronics
<PAGE>
Long-term debt 1998 1997
Lease obligations 9,462 3,002
Convertible employee debenture loan 6,611 4,586
Other 6,180 3,882
------ ------
22,253 11,470
------ ------
The average remaining life to maturity of the long-term lease obligations is
approximately five years, the average interest rate being 5.7%. The remaining
life to maturity of the other long-term liabilities is approximately three
years, the average interest rate being 7.2%.
The rate of interest paid on the convertible employee debenture loan, which is
convertible into Getronics NV shares, is based on the long-term yield on Dutch
government loans. The conversion prices amount to Dfl. 46.60 and Dfl. 64.50.
Conversion is possible until the maturity date of the loan on December 31, 2001
and December 30, 2002 respectively. Subject to conversion, the loan will be
redeemed on January 31, 2002 and January 31, 2003 respectively. Conversion may
increase the total number of Getronics NV shares issued by a maximum of 117,134.
Provisions 1998 1997
Pensions 42,242 44,948
Restructuring 28,981 36,880
Warranty 18,842 15,742
Millennium 13,077 14,863
Self-insurance 3,274 1,048
Deferred taxes 2,651 884
Other provisions 9,065 6,754
------- -------
118,132 121,119
------- -------
The pension claims of personnel are based on the final pay system or the defined
premium system. Pensions are placed with life insurance companies. A provision
has been included for the past-service liability and other non-activity plans.
Shareholders' equity
Shareholders' equity is specified in the notes to the company financial
statements on page 48.
Commitments not disclosed in the balance sheet
The extent of residual commitments relating to future earnings arising from
acquisition contracts cannot be estimated. Commitments on account of rent of
office premises and buildings and operating leases relating to the lease of
equipment and vehicles can be specified as follows:
1999 85,896
2000 62,917
2001 46,770
2002 24,086
2003 9,765
Total for following years 14,526
-------
Total 243,960
-------
Getronics 45
<PAGE>
Corporate financial statements
Corporate balance sheet as at December 31
(in thousands of Dutch guilders, after proposed profit distribution)
<TABLE>
<CAPTION>
------------------ -----------------
1998 1997
------------------ -----------------
<S> <C> <C> <C> <C>
Fixed assets
Financial fixed assets 148,113 21,194
Current assets
Due from Group companies 149,576 63,349
Other receivables 10,819 4,507
Cash 121,739 188,632
------- -------
Total current assets 282,134 256,488
------- -------
Current liabilities
Reserve for cash dividend for the year 20,000 6,000
Due to Group companies 6,700 77,836
Other liabilities 32,571 44,385
------- -------
59,271 128,221
------- -------
Working capital 222,863 128,267
------- -------
Total capital employed 370,976 149,461
- --------------------------------------------------------------------------------------------------------------
Financed by:
Long-term liabilities
Convertible employee debenture loan 6,611 4,586
Other liabilities 228 --
------- -------
6,839 4,586
Shareholders' equity
Issued and paid-up capital 22,511 21,910
Share premium reserve 255,064 74,847
Other reserves 86,562 48,118
------- -------
364,137 144,875
------- -------
Total financing 370,976 149,461
- --------------------------------------------------------------------------------------------------------------
Total assets 430,247 277,682
- --------------------------------------------------------------------------------------------------------------
Corporate income statement
(in thousands of Dutch guilders)
Result from investments 213,405 156,988
Other income 26,834 23,036
------- -------
Net earnings 240,239 180,024
- --------------------------------------------------------------------------------------------------------------
------------------ -----------------
</TABLE>
46 Getronics
<PAGE>
Notes to the corporate financial statements
(in thousands of Dutch guilders, unless stated otherwise)
The accounting policies are the same as those applied for the consolidated
financial statements. The method of profit determination is the same as the
method used for the consolidated income statement. Consolidated group companies
are stated at net asset value.
Financial fixed assets Consolidated
group companies
Beginning of year 21,194
Additions 86,281
Goodwill -170,916
Exchange rate differences on equity of group companies -1,851
Result from group companies 213,405
-------
End of year 148,113
-------
The item other current liabilities mainly relates to an amount due to a credit
institution.
The provision for the negative net asset value of consolidated group companies
was netted off against amounts owed by group companies in 1998. The figures for
1997 have been adjusted to facilitate comparison.
The shares in Getronics Holding Nederland BV and in Getronics International BV
are held by Getronics NV. The shares in the other group companies are held
through those companies. The principal group companies included in the
consolidation are (fully-owned unless indicated otherwise):
The Netherlands ACD Information Services (ACDIS) BV (331/3%), The Hague; Artessa
II BV, Utrecht; Bedrijfstelecommunicatie Services (BTS) BV, Amsterdam; Business
Management Group BV (65%), Amsterdam; Data-en Telecom Services BV (70%),
Utrecht; Electric Engineering BV, Nieuwegein; Getexo BV (50%), Hoofddorp; GetPak
Systems BV (50%), Amsterdam; Getronics Business Continuity BV, Lelystad;
Getronics Holding Nederland BV, Amsterdam; Getronics International BV,
Amsterdam; Getronics Investment Services BV, Amsterdam; Getronics Network
Services BV, Amsterdam; Getronics Networks & Services BV, Amsterdam; Getronics
RetailService BV, Gouda; Getronics Roll-Out Services BV, Amsterdam; Getronics
Software BV, Amsterdam; Getronics Transaction Services BV, Amsterdam; Geveke
Electronics BV, Amsterdam; Intercai Academy BV (50%), Utrecht; Intercal
Nederland BV (50%), Utrecht; Klaasing Electronics BV, Breda; Koning en Hartman
BV, Delft; RAET IT-Services BV, Nieuwegein; RAET Personele Systemen BV,
Amersfoort; RAET Systems & Services BV, Maarssen; Silvac BV, Hilversum; Synergie
Consultancy BV, The Hague; TeleTalent BV (50%), Utrecht; Vanandel BV, Rotterdam
Belgium Getronics NV, Asse-Zellik; Getronics Finance Corporation NV, Brussels;
Intercal Beigie NV (45%), Hasselt Denmark Ark Cinet Danmark AS (77.3%), Taastrup
Germany Getronics Service GmbH, Erlensee (Frankfurt); lntercai Teleconsult GmbH
(50%), Frankfurt United Kingdom Getech Ltd., Ipswich; Intercal Mondiale Ltd.
(50%), London Italy Intercal Etnoteam SpA (22.5%), Milan Mexico Control
Presupuestario SA, Monterrey Netherlands Antilles Intercal Antillen NV (29%),
Willemstad Norway Ark ASA / Ark Norge AS (77.3%), Lysaker; Ark Cinet (77.3%),
Oslo; Ark NetCenter (77.3%), Lysaker; Ark Skrivervik Data (77.3%), Oslo; Lantec
AS (77.3%), Sandefjord; NC Distribusjon AS (77.3%), Lysaker Portugal Control
Presupuestario Lda, Lisbon Spain Control Presupuestario SL, Madrid; Diode
Esprana SA, Madrid; Getronics Networks SA, Madrid; Getronics Networks & Services
SA, Barcelona; Getronics Technologies Holdings SL, Madrid United States Intercai
Mondiale US Inc (50%), Chicago Switzerland Intercai (Schweiz) AG (45%), Zurich
Getronics 47
<PAGE>
<TABLE>
<CAPTION>
Shareholders' equity Share Share premium Other Total
capital reserve reserves
<S> <C> <C> <C> <C>
Beginning of year 21,910 74,847 48,118 144,875
Prior-year dividend settlement 57 -57 -9,028 -9,028
Share issues 544 182,836 -- 183,380
Issue costs -- -2,562 -- -2,562
Goodwill -- -- -170,916 -170,916
Exchange rate differences on equity
of Group companies -- -- -1,851 -1,851
Result for the year -- -- 240,239 240,239
Reserve for cash dividend for the year -- -- -20,000 -20,000
------ ------- ------ -------
End of year 22,511 255,064 86,562 364,137
------ ------- ------ -------
</TABLE>
The authorized share capital of Dfl. 100 million is divided into 200 million
ordinary shares of Dfl. 0.25 nominal value and 200 million preference shares of
Dfl. 0.25 nominal value. On December 31, 1998, 90,043,896 (1997: 87,640,970)
ordinary shares were issued and outstanding. From the share premium reserve Dfl.
248,427 (1997: Dfl. 68,096) can be distributed free of tax. The option rights
outstanding under the Employee Stock Option Plan as at the balance sheet date
can be specified as follows:
Number of Weighted Year
underlying average of
shares exercise price expiry
(in Dfl.)
235,240 9.67 1999
159,900 14.55 2000
625,044 41.85 2001
196,000 62.81 2002
407,800 79.44 2003
--------- -----
1,623,984 46.47
--------- -----
The number of option rights granted to employees in 1998 was 701,597, while
481,523 option rights were offered to employees on January 4, 1999. The option
rights can be exercised at the price of Dfl. 105.09 and expire on January 3,
2003.
Getronics sold a total of 3.4 million Ark ASA shares at NOK 91 per share to
third parties in 1997 and 1998. Getronics issued the holder of each Ark ASA
share with an exchange certificate entitling him to exchange one Ark share into
0.3867 Getronics NV shares. The periods during which the right of exchange can
be exercised are limited to the month of July 1999 as well as the calendar year
2001. A maximum of 1,314,780 Getronics NV shares can be issued as a result of
the exchange.
For the shares which can be issued through exercising the conversion rights
attached to the convertible employee debenture loan, reference is made to the
notes to the consolidated balance sheet on page 45.
48 Getronics
<PAGE>
Other financial commitments
The Company has issued statements of guarantee for several liability for
commitments ensuing from legal transactions of the majority of its fully-owned
Dutch group companies. On the basis of the guarantee statements, the group
companies have made use of the possibilities for dispensation as stipulated in
section 403, subsections 1 and 3, Part 9, Book 2 of the Netherlands Civil code.
Amsterdam, February 25, 1999
The Board of Management The Supervisory Board
Other information
Provisions of the Articles of Association on profit appropriation
Art. 31.1. Such a part of net earnings as disclosed in the approved financial
statements shall be reserved as the Joint Assembly shall determine.
Art. 31.3. The then remaining part of net earnings shall be at the disposal of
the General Meeting, on the understanding that no additional payments on
preference shares shall be charged to those net earnings. The Joint Assembly
shall make a dividend proposal for the dividend on the ordinary shares.
Profit appropriation
(in thousands of Dutch guilders)
Net earnings for 1998 amount to 240,239
In compliance with article 31, paragraph 1,
of the Articles of Association,
an allocation to the reserve has been made of 195,217
-------
In accordance with article 31, paragraph 3,
the following amount is at the disposal
of the General Meeting of Shareholders 45,022
------
Dividend proposal
It will be proposed to the General Meeting of Shareholders to distribute a
dividend - for each ordinary share of Dfl. 0.25 nominal value - of either Dfl.
0.50 in cash or in shares to the debit of the share premium reserve or retained
earnings. The size of the stock dividend will be determined on April 22, 1999
after close of trading based on the average closing prices of the Getronics NV
share on the Amsterdam Exchanges on April 20 through April 22, 1999. The value
of the stock dividend will be virtually equivalent to the value of the cash
dividend. The newly acquired shares are entitled to the final dividend for the
year 1999 and the full dividend for the following years. The estimated amount
that will be distributed in cash (Dfl. 20 million) is stated in the financial
statements under current liabilities.
Getronics 49
<PAGE>
Large company regime
Since 1989 Getronics NV has been subject to the rules for large companies and on
that account the provisions laid down in sections 158 - 164, Book 2 of the
Netherlands Civil Code, are applicable.
Stichting Preferente Aandelen Getronics NV
The object of the 'Stichting Preferente Aandelen Getronics NV' (Getronics NV
Preference Shares Foundation), which was established in 1987, is to represent
the interests of Getronics NV and all persons associated with it. The Foundation
endeavors to achieve this object by acquiring preference shares in the Company
and by exercising the rights attached to such shares.
The Board of the Foundation now comprises four A category board members and two
B category board members. Only persons who are not associated with the Company
within the meaning of Appendix X to the 'Fondsenreglement van de Vereniging voor
de Effectenhandel' (Listing end Issuing Rules of the Stock Exchange Association)
may be appointed as A category board members.
The following persons are members of the Board of the Foundation as A category
members:
Prof. A.A. Kampfraath, Chairman
Jhr. J.P.E. Teding van Berkhout, Deputy Chairman
I.J. Vos
Prof. G. Zoutendijk
The B category members are:
J.C. Bakker, Deputy Chairman of the Supervisory Board of Getronics NV
A.H.J. Risseeuw, President and CEO of Getronics NV
At the request of the Board of the Foundation, it was announced in February
1992, in accordance with the 'Wet Melding Zeggenschap' (Major Holdings in Listed
Companies Disclosure Act), that the Foundation has options on preference shares
in Getronics NV. The maximum number of preference shares which may be obtained
by the 'Stichting Preferente Aandelen Getronics NV' (Getronics NV Preference
Shares Foundation) under this option arrangement has been set at the number of
issued ordinary shares at the moment of issue.
Amsterdam, February 25, 1999
The Board of Management The Supervisory Board
50 Getronics
<PAGE>
Auditor's report
Introduction
We have audited the 1998 financial statements of Getronics NV, Amsterdam, as
included in this report. These financial statements are the responsibility of
the company's management. Our responsibility is to express an opinion on these
financial statements based on our audit.
Scope
We conducted our audit in accordance with auditing standards generally accepted
in the Netherlands. Those standards require that we plan and perform the audit
to obtain reasonable assurance about whether the financial statements are free
of material misstatement. An audit includes examining, on a test basis, evidence
supporting the amounts and disclosures in the financial statements. An audit
also includes assessing the accounting principles used and significant estimates
made by management, as well as evaluating the overall financial statement
presentation. We believe that our audit provides a reasonable basis for our
opinion.
Opinion
In our opinion, the financial statements give a true and fair view of the
financial position of the company as at December 31, 1998 and of the result for
the year then ended in accordance with accounting principles generally accepted
in the Netherlands and comply with the financial reporting requirements included
in Part 9, Book 2 of the Netherlands Civil Code.
Amsterdam, February 25, 1999
PricewaterhouseCoopers N.V.
Getronics 51
<PAGE>
Ten-year record Getronics
<TABLE>
<CAPTION>
Data from the consolidated financial 1998(1) 1997(2) 1996 1995(3) 1994
statements (in millions of Dutch guilders)
<S> <C> <C> <C> <C> <C>
Net sales 3,459.2 2,776.5 2,210.7 1,703.1 1,409.9
Added value(5) 1,647.6 1,237.9 1,029.1 763.2 607.3
Operating result 319.3 236.5 181.3 143.5 111.3
Net interest income/expense +7.4 +11.8 +11.6 +13.5 +10.5
Group earnings before taxes 326.6 251.2 200.1 157.5 124.2
Group earnings after taxes 253.1 184.2 143.9 104.2 82.2
Net earnings 240.2 180.0 131.6 97.5 80.2
Cash flow(6) 291.5 212.9 179.4 129.7 104.6
Depreciation of tangible fixed assets 50.5 42.0 35.4 25.5 22.3
Additions to tangible fixed assets 85.3 60.8 51.9 36.5 24.6
Employees (in FTE)(7)
As at December 31 12,458 8,083 6,987 6,234 4,153
of whom abroad 4,862 1,641 1,161 1,160 910
Average over the year 10,044 7,439 6,611 4,994 4,082
Some balance sheet data
(in millions of Dutch guilders)
Fixed assets 178.0 120.1 95.3 89.8 71.7
Capital employed 524.2 286.8 331.1 317.6 365.4
Group equity (9) 383.8 154.2 260.2 273.9 324.8
Long-term debt 22.3 11.5 3.1 4.2 5.8
Total assets 1,392.3 1,024.5 986.6 846.8 704.2
Ratios
Increase in net sales compared to
previous year 24.6% 25.6% 29.8% 20.8% 8.3%
Added value(5) / net sales 47.6% 44.6% 46.6% 44.8% 43.1%
Operating margin 9.2% 8.5% 8.2% 8.4% 7.9%
Net Group margin 7.3% 6.6% 6.5% 6.1% 5.8%
Cash flow / net sales 8.4% 7.7% 8.1% 7.6% 7.4%
Group earnings / average Group equity 94.1% 88.9% 53.9% 34.8% 28.9%
Solvency 34.8% 17.8% 41.4% 49.5% 81.2%
Group equity(9) / capital employed 73.2% 53.8% 78.6% 86.2% 88.9%
Current ratio (current assets /
current liabilities) 1.40 1.23 1.36 1.43 1.87
Sales per employee
(in Dutch guilders)(7) 344,405 373,236 334,397 341,029 345,394
Added value per employee
(in Dutch guilders)(5) + (7) 164,038 166,407 155,665 152,823 148,775
Data per ordinary share of Dfl. 0.25 nominal value
(in Dutch guilders)
Net earnings(10) 2.69 2.06 1.52 1.14 0.96
Cash flow(10) 3.26 2.44 2.08 1.52 1.25
Shareholders' equity(9) 4.04 1.65 2.94 3.02 3.77
Cash dividend(11) 0.50 0.41 0.30 0.25 0.21
Stock dividend(12) 1 for 225 1 for 180 1 for 105 1 for 67
Number of ordinary shares
outstanding
as at December 31 (x 1,000) 90,043.9 87,641.0 86,888.5 85,903.9 84,552.3
Highest price 121.00 75.00 46.90 19.88 15.88
Lowest price 56.20 45.50 18.83 14.75 9.75
Closing price as at December 31 93.00 64.60 46.90 18.75 15.83
Market capitalization (in DFl. million) 8,374 5,662 4,075 1,611 1,338
</TABLE>
72 Getronics
<PAGE>
1993 1992 1991(4) 1990 1989
1,302.4 1,026.0 827.5 660.4 594.7
579.9 481.1 398.4 309.0 267.2
91.1 85.3 71.7 64.7 55.6
+8.9 +4.7 +2.0 +4.0 -0.5
100.4 90.4 74.0 67.2 55.2
67.4 62.0 54.0 46.8 41.0
65.6 60.7 53.3 46.6 40.1
90.2 82.2 73.7 63.2 55.3
22.9 20.2 19.4 14.9 15.2
22.8 21.6 32.4 27.0 15.1
4,032 3,191 3,127(8) 2,362 2,044
843 425 342(8) 332 282
3,994 3,159 2,611(8) 2,302 1,975
75.5 67.2 68.0 42.0 29.7
289.5 241.5 192.3 152.6 138.5
244.7 205.2 158.5 138.7 123.9
9.8 8.3 7.0 1.1 2.7
598.3 473.0 419.7 339.5 290.0
26.9% 24.0% 25.3% 11.1% 52.3%
44.5% 46.9% 48.1% 46.8% 44.9%
7.0% 8.3% 8.7% 9.8% 9.4%
5.2% 6.0% 6.5% 7.1% 6.9%
6.9% 8.0% 8.9% 9.6% 9.3%
30.0% 34.1% 36.3% 35.6% 38.5%
62.9% 67.3% 46.4% 58.0% 56.0%
84.5% 85.0% 82.4% 90.9% 89.5%
1.69 1.75 1.56 1.59 1.72
326,089 324,786 316,928 286,881 301,114
145,193 152,295 152,585 134,231 135,291
0.80 0.76 0.70 0.63 0.56
1.11 1.03 0.96 0.86 0.78
2.87 2.54 2.01 1.85 1.68
0.18 0.17 0.16 0.14 0.13
1 for 60 1 for 47 1 for 50 1 for 50 1 for 55
82,799.2 80,368.1 78,731.8 74,494.1 72,616.3
11.30 9.13 8.28 9.23 8.45
7.20 7.03 6.88 6.88 6.20
10.93 7.60 7.18 7.13 7.05
905 611 565 531 512
10-year Getronics
- --------------------------------------------------------------------------------
Net earnings per share in Dfl.
[GRAPHIC]
Net sales and net earnings
(index 1989 = 100)
[GRAPHIC]
1) With effect from July 1, 1998 the financial data of Grupo CP and IBM ASAP
have been included in the consolidation.
2) With effect from October 1, 1997 the financial data of Ark ASA and with
effect from January 1, 1997 the financial data of RAET NV have been
included in the consolidation.
3) The RAET activities have been included in the consolidation with effect
from September 1, 1995.
4) The financial data of Koning en Hartman BV have been included in the
consolidation as from the fourth quarter of 1991.
5) For reasons of comparison, the figures for 1993 through 1996 have been
adjusted to reflect the changed definition of the gross margin: costs for
temporary contracted workers, who are managed and supervised by Getronics,
are included in full under personnel costs.
6) Cash flow is defined as the total of net earnings (excluding extraordinary
income), depreciation of tangible fixed assets and minority interests. The
historical figures have been adjusted to facilitate comparison
7) With effect from 1997 the concept of 'employees' includes temporary
contracted workers managed and supervised by Getronics. The figures for
1993 through l996 have been adjusted to facilitate comparison.
8) With effect from 1992 the concept 'employees in permanent employment' has
been defined more precisely. To facilitate comparison, FTEs for the year
1991 have been adjusted. The total number of employees, of whom employed
abroad and average over the year included in the 1991 financial statements
were 3,241, 351 and 2,714 respectively.
9) With effect from 1991 group and shareholders' equity have been determined
after deduction of the estimated cash dividend. In the years prior to 1991
group and shareholders' equity were determined after deduction of the
total cash dividend that could be claimed.
10) On the basis of the average number of shares outstanding and exclusive of
extraordinary income. The historical figures have been adjusted to
facilitate comparison.
11) The cash dividend for 1998 concerns a dividend proposal.
12) Stock dividend from the share premium reserve or retained earnings.
Getronics 73
