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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13D
(UNDER THE SECURITIES EXCHANGE ACT OF 1934)
Bryan Steam Corporation
(Name Of Issuer)
-----------
COMMON STOCK, PAR VALUE $10.00 PER SHARE
(Title of Class of Securities)
117547 109
(CUSIP Number of Class of Securities)
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Albert Morrison III
Burnham Corporation
1241 Harrisburg Avenue
Lancaster, PA 17603
(717) 293-5800
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
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COPY TO:
Donald A. Stern, Esq.
Cleary, Gottlieb, Steen & Hamilton
One Liberty Plaza
New York, New York 10006
(212) 225-2000
-----------
September 23, 1998
(Date of Event which Requires
Filing of this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this
Schedule 13D, and is filing this Schedule because of Rule
13d-1(b)(3) or (4), check the following box [ ].
Page 1 of 8 Pages
Exhibit Index Appears on Page 8
<PAGE>
SCHEDULE 13D
- --------------------------- ------------------------
CUSIP No. 117547 109 Page 2 of 8 Pages
- --------------------------- ------------------------
- -----------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
(ENTITIES ONLY)
Burnham Acquisition Corporation
- -----------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |_|
(b) |_|
- -----------------------------------------------------------------
3 SEC USE ONLY
- -----------------------------------------------------------------
4 SOURCE OF FUNDS
AF
- -----------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e)
|_|
- -----------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New Mexico
- -----------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES None
-------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY
106,315*
-------------------------------------------------
EACH REPORTING 9 SOLE DISPOSITIVE POWER
PERSON
None
-------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
106,315*
- -----------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
106,315* Shares
- -----------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
|_|
- -----------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
55.6%
- -----------------------------------------------------------------
14 TYPE OF REPORTING PERSON
CO
- -----------------------------------------------------------------
* On September 23, 1998, Burnham Corporation ("Parent") and
Burnham Acquisition Corporation ("Purchaser") entered into a
stockholders' agreement (the "Stockholders' Agreement") with
ten stockholders (the "Proxy Grantors"). Pursuant to the
Stockholders' Agreement, upon the terms and subject to the
conditions therein, the Proxy Grantors generally have agreed
to tender, in accordance with the terms of the tender offer
described in this Statement, all of their 106,315 shares of
common stock, par value $10.00 per share, of Bryan Steam
Corporation. In addition, the Proxy Grantors have granted an
irrevocable proxy with respect to such shares to Parent and
an irrevocable option, exercisable in limited circumstances,
with respect to such shares to Purchaser. These shares are
reflected in rows 8 and 10 above. The Stockholders'
Agreement are described in more detail in Section 12 of the
Offer to Purchase referred to in this Statement.
<PAGE>
SCHEDULE 13D
- --------------------------- ------------------------
CUSIP No. 117547 109 Page 3 of 8 Pages
- --------------------------- ------------------------
- -----------------------------------------------------------------
1 NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS
(ENTITIES ONLY)
Burnham Corporation
- -----------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) |_|
(b) |_|
- -----------------------------------------------------------------
3 SEC USE ONLY
- -----------------------------------------------------------------
4 SOURCE OF FUNDS
WC, OO
- -----------------------------------------------------------------
5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEMS 2(d) or 2(e) |_|
- -----------------------------------------------------------------
6 CITIZENSHIP OR PLACE OF ORGANIZATION
New York
- -----------------------------------------------------------------
NUMBER OF 7 SOLE VOTING POWER
SHARES None
-------------------------------------------------
BENEFICIALLY 8 SHARED VOTING POWER
OWNED BY
106,315*
-------------------------------------------------
EACH REPORTING 9 SOLE DISPOSITIVE POWER
PERSON
None
-------------------------------------------------
WITH 10 SHARED DISPOSITIVE POWER
106,315*
- -----------------------------------------------------------------
11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING
PERSON
106,315* Shares
- -----------------------------------------------------------------
12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES
|_|
- -----------------------------------------------------------------
13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
55.6%
- -----------------------------------------------------------------
14 TYPE OF REPORTING PERSON
CO
- -----------------------------------------------------------------
* On September 23, 1998, Burnham Corporation ("Parent") and
Burnham Acquisition Corporation ("Purchaser") entered into a
stockholders' agreement (the "Stockholders' Agreement") with
ten stockholders (the "Proxy Grantors"). Pursuant to the
Stockholders' Agreement, upon the terms and subject to the
conditions therein, the Proxy Grantors generally have agreed
to tender, in accordance with the terms of the tender offer
described in this Statement, all of their 106,315 shares of
common stock, par value $10.00 per share, of Bryan Steam
Corporation. In addition, the Proxy Grantors have granted an
irrevocable proxy with respect to such shares to Parent and
an irrevocable option, exercisable in limited circumstances,
with respect to such shares to Purchaser. These shares are
reflected in rows 8 and 10 above. The Stockholders'
Agreement are described in more detail in Section 12 of the
Offer to Purchase referred to in this Statement.
<PAGE>
This Schedule 13D (the "Statement") relates to a tender
offer by Burnham Acquisition Corporation, a New Mexico
corporation ("Purchaser") and a wholly-owned subsidiary of
Burnham Corporation, a New York corporation ("Parent"), to
purchase all outstanding shares of Common Stock, par value $10.00
per share, of Bryan Steam Corporation, a New Mexico corporation,
for a purchase price of $152.00 per share, net to the seller in
cash, without interest thereon, upon the terms and subject to the
conditions set forth in the Offer to Purchase dated September 29,
1998 of Purchaser (the "Offer to Purchase") and in the related
Letter of Transmittal (collectively, the "Offer"), and is
intended to satisfy the reporting requirements of Section 13(d)
of the Securities Exchange Act of 1934, as amended. Copies of the
Offer to Purchase and the related Letter of Transmittal are filed
as Exhibits (a)(1) and (a)(2) hereto, respectively.
ITEM 1. SECURITY AND ISSUER.
The name of the subject company is Bryan Steam Corporation,
a New Mexico corporation (the "Company"), which has its principal
executive offices at P.O. Box 27, Peru, Indiana 46970. The title
of the securities which are the subject of the Offer is the
Company's Common Stock, $10.00 par value (the "Shares"), at a
price of $152.00 net to the seller in cash per share. The offer
is for all outstanding Shares. The information set forth in the
"Introduction" of the Offer to Purchase is incorporated herein by
reference.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(c) and (f) This Statement is being filed by Purchaser
and Parent. The information set forth in "Section 9. Certain
Information Concerning Purchaser and Parent" of the Offer to
Purchase and in Annex I (Directors and Executive Officers of
Purchaser and Parent) to the Offer to Purchase ("Annex I") is
incorporated herein by reference.
(d)-(e) During the last five years, none of Purchaser,
Parent or, to the best knowledge of Purchaser and Parent, any
executive officer or director of Purchaser or Parent listed in
Annex I (which is incorporated herein by reference) has been
convicted in a criminal proceeding (excluding traffic violations
or similar misdemeanors) or has been a party to a civil
proceeding of a judicial or administrative body of competent
jurisdiction as a result of which such person was or is subject
to a judgment, decree or final order enjoining future violations
of, or prohibiting or mandating activities subject to, Federal or
state securities laws or finding any violation of such laws.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
The information set forth in "Section 10. Source and Amount
of Funds" of the Offer to Purchase is incorporated herein by
reference.
ITEM 4. PURPOSE OF TRANSACTION.
(a)-(j) The information set forth in the "Introduction,"
"Section 7. Certain Effects of the Transaction" and "Section 12.
Purpose of the Offer; The Merger Agreement; The Stockholders'
Agreement" of the Offer to Purchase is incorporated herein by
reference.
Page 4 of 8 Pages
<PAGE>
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER.
(a)-(d) The information set forth in the "Introduction,"
"Section 11. Background of the Transaction" and "Section 12.
Purpose of the Offer; The Merger Agreement; The Stockholders'
Agreement" of the Offer to Purchase and in Annex I to the Offer
to Purchase is incorporated herein by reference.
(e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS
WITH RESPECT TO SECURITIES OF THE ISSUER.
The information set forth in the "Introduction," "Section
11. Background of the Transaction" and "Section 12. Purpose of
the Offer; The Merger Agreement; The Stockholders' Agreement" of
the Offer to Purchase is incorporated herein by reference.
Page 5 of 8 Pages
<PAGE>
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
(a)(1) Offer to Purchase.
(a)(2) Letter of Transmittal.
(a)(3) Notice of Guaranteed Delivery.
(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees.
(a)(5) Letter to Clients for use by Brokers, Dealers,
Commercial Banks, Trust Companies and Other
Nominees.
(a)(6) Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9.
(a)(7) Text of Joint Press Release dated September 23, 1998,
issued by Parent and the Company.
(a)(8) Form of Summary Advertisement dated September 29, 1998.
(c)(1) Agreement and Plan of Merger, dated as of
September 23, 1998, among Parent, Purchaser and the
Company.
(c)(2) Stockholders' Agreement, dated September 23, 1998,
among Parent, Purchaser and certain individuals named
therein.
Page 6 of 8 Pages
<PAGE>
SIGNATURE
After due inquiry and to the best of its knowledge and
belief, each of the undersigned certifies that the information
set forth in this Statement is true, complete and correct.
Dated: September 29, 1998
BURNHAM ACQUISITION
CORPORATION
By /s/ Ronald L. Griffith
----------------------------
Name: Ronald L. Griffith
Title: Secretary
BURNHAM CORPORATION
By /s/ Ronald L. Griffith
----------------------------
Name: Ronald L. Griffith
Title: Senior Vice President-Finance
and Secretary-Treasurer
Page 7 of 8 Pages
<PAGE>
EXHIBIT INDEX
(a)(1) Offer to Purchase.
(a)(2) Letter of Transmittal.
(a)(3) Notice of Guaranteed Delivery.
(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees.
(a)(5) Letter to Clients for use by Brokers, Dealers,
Commercial Banks, Trust Companies and Other
Nominees.
(a)(6) Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9.
(a)(7) Text of Joint Press Release dated September 23, 1998,
issued by Parent and the Company.
(a)(8) Form of Summary Advertisement dated September 29, 1998.
(c)(1) Agreement and Plan of Merger, dated as of
September 23, 1998, among Parent, Purchaser and the
Company.
(c)(2) Stockholders' Agreement, dated September 23, 1998,
among Parent, Purchaser and certain individuals named
therein.
Page 8 of 8 Pages
Offer to Purchase for Cash
All Outstanding Shares of Common Stock
of
Bryan Steam Corporation
at
$152.00 Net Per Share
by
Burnham Acquisition Corporation
a wholly-owned subsidiary of
Burnham Corporation
- -----------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON WEDNESDAY, OCTOBER 28, 1998, UNLESS
THE OFFER IS EXTENDED.
- -----------------------------------------------------------------
THE OFFER IS BEING MADE PURSUANT TO THE TERMS OF AN
AGREEMENT AND PLAN OF MERGER, DATED AS OF SEPTEMBER 23, 1998 (THE
"MERGER AGREEMENT"), AMONG BURNHAM CORPORATION ("PARENT"),
BURNHAM ACQUISITION CORPORATION ("PURCHASER") AND BRYAN STEAM
CORPORATION ("BRYAN" OR THE "COMPANY"). THE BOARD OF DIRECTORS OF
THE COMPANY UNANIMOUSLY HAS DETERMINED THAT THE OFFER AND THE
MERGER ARE FAIR TO, AND IN THE BEST INTERESTS OF, THE COMPANY AND
ITS STOCKHOLDERS, HAS APPROVED THE MERGER AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED THEREBY AND RECOMMENDS THAT THE
COMPANY'S STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR SHARES
OF COMMON STOCK OF THE COMPANY ("SHARES") PURSUANT THERETO.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE
BEING VALIDLY TENDERED AND NOT WITHDRAWN AT THE EXPIRATION OF THE
OFFER AT LEAST SIXTY-SIX AND TWO-THIRDS PERCENT (66-2/3%) PLUS
ONE OF THE OUTSTANDING SHARES ON A FULLY DILUTED BASIS ON THE
DATE OF PURCHASE (THE "MINIMUM CONDITION"). THE OFFER IS ALSO
SUBJECT TO CERTAIN OTHER CONDITIONS CONTAINED IN THIS OFFER TO
PURCHASE. SEE INTRODUCTION AND SECTIONS 1 AND 14 HEREOF.
Purchaser has entered into a Stockholders' Agreement with
certain stockholders, who together own approximately 55.6% of the
outstanding Shares, pursuant to which, among other things, such
stockholders have irrevocably agreed validly to tender (and not
to withdraw) all such Shares pursuant to the Offer, and such
stockholders have granted Parent a proxy with respect to the
voting of such Shares in favor of the Merger.
---------
The Information Agent for the Offer is:
[LOGO OF MACKENZIE PARTNERS, INC.]
<PAGE>
Any stockholder desiring to tender all or a portion of such
stockholder's Shares should either (1) complete and sign the
Letter of Transmittal (or a manually signed facsimile thereof) in
accordance with the instructions in the Letter of Transmittal,
have such stockholder's signature thereon guaranteed if required
by Instruction 1 or 5 of the Letter of Transmittal, mail or
deliver it and any other required documents to the Depositary,
and either deliver the certificates for such Shares to the
Depositary along with the Letter of Transmittal or tender such
Shares pursuant to the procedures for book-entry transfer set
forth in Section 3 hereof or (2) request such stockholder's
broker, dealer, commercial bank, trust company or other nominee
to effect the transaction for such stockholder. Any stockholder
whose Shares are registered in the name of a broker, dealer,
commercial bank, trust company or other nominee must contact such
broker, dealer, commercial bank, trust company or other nominee
if such stockholder desires to tender such Shares.
Any stockholder who desires to tender Shares and whose
certificates representing such Shares are not immediately
available, who cannot comply with the procedure for book-entry
transfer on a timely basis or who cannot deliver all required
documents to the Depositary prior to the expiration of the Offer,
may tender such Shares by following the procedures for guaranteed
delivery set forth in Section 3.
Questions and requests for assistance may be directed to
the Information Agent at the address and telephone number set
forth on the back cover of this Offer to Purchase. Requests for
additional copies of this Offer to Purchase, the Letter of
Transmittal, the Notice of Guaranteed Delivery and other related
materials may be directed to the Information Agent or to brokers,
dealers, commercial banks and trust companies.
September 29, 1998
- ii -
<PAGE>
TABLE OF CONTENTS
INTRODUCTION....................................................1
1. TERMS OF THE OFFER..........................................2
2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES...............4
3. PROCEDURE FOR TENDERING SHARES..............................5
4. WITHDRAWAL RIGHTS...........................................7
5. CERTAIN U.S. FEDERAL INCOME TAX CONSEQUENCES................8
6. PRICE RANGE OF THE SHARES; DIVIDENDS........................9
7. CERTAIN EFFECTS OF THE TRANSACTION..........................9
8. CERTAIN INFORMATION CONCERNING THE COMPANY.................10
9. CERTAIN INFORMATION CONCERNING PURCHASER AND PARENT........12
10. SOURCE AND AMOUNT OF FUNDS.................................13
11. BACKGROUND OF THE TRANSACTION..............................13
12. PURPOSE OF THE OFFER; THE MERGER AGREEMENT; THE
STOCKHOLDERS' AGREEMENT....................................15
13. DIVIDENDS AND DISTRIBUTIONS................................29
14. CERTAIN CONDITIONS OF THE OFFER............................29
15. CERTAIN LEGAL MATTERS......................................31
16. CERTAIN FEES AND EXPENSES..................................32
17. MISCELLANEOUS..............................................32
Annex I - Directors and Executive Officers of Purchaser and Parent
- iii -
<PAGE>
To the Holders of Common Stock of
Bryan Steam Corporation:
INTRODUCTION
Burnham Acquisition Corporation, a New Mexico corporation
("Purchaser") and a wholly-owned subsidiary of Burnham
Corporation, a New York corporation ("Parent"), hereby offers to
purchase all outstanding shares of the Common Stock, par value
$10.00 per share (the "Shares"), of Bryan Steam Corporation, a
New Mexico corporation ("Bryan" or the "Company"), at a purchase
price of $152.00 per Share (the "Offer Price"), net to the seller
in cash, without interest thereon, upon the terms and subject to
the conditions set forth in this Offer to Purchase and in the
related Letter of Transmittal (which, together with any
supplements or amendments thereto, collectively constitute the
"Offer"). Tendering stockholders will not be obligated to pay
brokerage fees or commissions or, except as set forth in
Instruction 6 to the Letter of Transmittal, transfer taxes on the
purchase of Shares pursuant to the Offer. Purchaser or Parent
will pay all charges and expenses of IBJ Schroder Bank & Trust
Company, as the depositary (the "Depositary"), and MacKenzie
Partners, Inc., as the information agent (the "Information
Agent"), incurred in connection with the Offer. See Section 16.
The Offer is conditioned upon, among other things, there
being validly tendered and not withdrawn at the expiration of the
Offer at least sixty-six and two-thirds percent (66-2/3%) plus
one of the outstanding Shares on a fully diluted basis on the
date of purchase (the "Minimum Condition"). The Offer is also
subject to certain other conditions. See Section 1 and Section 14
hereof.
The Offer is being made pursuant to an Agreement and Plan
of Merger, dated as of September 23, 1998 (the "Merger
Agreement"), among Parent, Purchaser and the Company. The Merger
Agreement provides, among other things, for the making of the
Offer by Purchaser and further provides that, following the
completion of the Offer and subject to the satisfaction or waiver
of certain conditions, Purchaser will be merged with and into the
Company (the "Merger"), with the Company surviving the Merger as
a wholly owned subsidiary of Parent with the name "Bryan Steam
Corporation" (the "Surviving Corporation"). As a result of the
Merger, each outstanding Share (other than Shares held by Parent,
Purchaser or any subsidiary of Parent, Purchaser or the Company,
Shares held in the treasury of the Company and Shares
("Dissenting Shares") held by stockholders who have properly
exercised their rights to fair value appraisal rights under the
New Mexico Business Corporation Act ("NMBCA")) will be converted
at the effective time of the Merger (the "Effective Time") into
the right to receive in cash the price per Share paid in the
Offer without interest (the "Merger Consideration"). For a
description of the Merger Agreement, see Section 12. Certain U.S.
federal income tax consequences of the sale of Shares pursuant to
the Offer and the exchange of Shares for cash pursuant to the
Merger (whether as Merger Consideration or cash amounts received
pursuant to the exercise of appraisal rights) are described in
Section 5.
Concurrently with the execution of the Merger Agreement,
and as a condition and inducement to Parent and Purchaser
entering into the Merger Agreement, Purchaser and Parent entered
into an agreement, dated September 23, 1998 (the "Stockholders'
Agreement"), with certain individuals named therein (each, a
"Proxy Grantor") who in the aggregate beneficially own 106,315
Shares (representing approximately 55.6% of the outstanding
Shares). Pursuant to the Stockholders' Agreement, the Proxy
Grantors have (i) agreed validly to tender (and not to withdraw)
all such Proxy Grantor's Shares in the Offer and (ii) granted
Parent a proxy with respect to the voting of such Shares in favor
of the Merger upon the terms and subject to the conditions set
forth therein. For a more detailed description of the
Stockholders' Agreement, see Section 12.
THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY HAS
DETERMINED THAT THE OFFER AND THE MERGER ARE FAIR TO, AND IN THE
BEST INTERESTS OF, THE COMPANY AND ITS STOCKHOLDERS AND
RECOMMENDS THAT STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR
SHARES PURSUANT TO THE OFFER.
MCDONALD & COMPANY SECURITIES, INC. ("MCDONALD & CO."), THE
COMPANY'S INDEPENDENT FINANCIAL ADVISOR, HAS ADVISED THE
COMPANY'S BOARD OF DIRECTORS THAT, IN ITS OPINION, THE
CONSIDERATION TO BE RECEIVED BY THE STOCKHOLDERS OF THE COMPANY
IN CONNECTION WITH THE OFFER AND THE MERGER IS FAIR TO SUCH
HOLDERS, FROM A FINANCIAL POINT OF VIEW. A COPY OF THE OPINION OF
MCDONALD & CO. IS AN EXHIBIT TO THE COMPANY'S
<PAGE>
SOLICITATION/RECOMMENDATION STATEMENT ON SCHEDULE 14D-9 (THE
"SCHEDULE 14D-9") FILED WITH THE SECURITIES AND EXCHANGE
COMMISSION (THE "COMMISSION") IN CONNECTION WITH THE OFFER A COPY
OF WHICH (WITHOUT CERTAIN EXHIBITS) IS BEING FURNISHED TO
STOCKHOLDERS CONCURRENTLY HEREWITH.
The Company has represented pursuant to the Merger
Agreement that, as of September 23, 1998, 191,284 Shares were
issued and outstanding and that as of that date no options to
purchase any Shares were issued and outstanding. Parent,
Purchaser and their affiliates do not currently beneficially own
any Shares or rights to acquire Shares other than the rights to
acquire Shares pursuant to the Stockholders' Agreement. Based on
the foregoing, Purchaser believes the Minimum Condition would be
satisfied if 127,524 Shares are duly tendered and not withdrawn
pursuant to the Offer.
The consummation of the Merger is subject to the
satisfaction or waiver of a number of conditions, including, if
required, the approval of the Merger by the requisite vote of the
stockholders of the Company in accordance with applicable law.
The NMBCA is applicable to the Company and the Merger because the
Company is organized under the laws of New Mexico. Under the
NMBCA, approval of the Merger requires the affirmative vote of
holders of a two-thirds majority of the shares entitled to vote
thereon, provided, that a holder of at least 90% of the
outstanding shares of each class of stock of a corporation may
cause the merger of such corporation with such holder without the
vote of the stockholders of the corporation.
If the Minimum Condition is satisfied, Purchaser will own
at least 66-2/3% plus one of the then outstanding Shares. In such
event, Parent and Purchaser believe that the Merger will be
approved at a subsequent meeting of the stockholders of the
Company (if such a meeting is required). If at least 90% of the
outstanding Shares are tendered and acquired by Purchaser in the
Offer, then Parent and Purchaser believe that, under the NMBCA,
Purchaser will be able to approve the Merger Agreement and effect
the Merger pursuant to the "short-form" merger provisions of
Section 53-14-5 of the NMBCA without any action by any other
stockholder. If the Minimum Condition is satisfied but less than
90% of the then outstanding Shares are tendered, then a vote of
the Company's stockholders will be required under the NMBCA to
approve the Merger. In that event, a longer period of time may be
required to effect the Merger. In any event, Purchaser intends to
effect the Merger in accordance with the terms of the Merger
Agreement as promptly as possible following the purchase of
Shares pursuant to the Offer.
If sufficient shares are not validly tendered pursuant to
the Offer to satisfy the Minimum Condition, Purchaser has the
option (i) to extend the Offer in accordance with (and subject to
the limitations of) the Merger Agreement, (ii) subject to
compliance with applicable rules and regulations of the
Commission, to waive the Minimum Condition, or (iii) to take such
other action as may be allowed by the Merger Agreement including
the termination of the Merger Agreement. In such event, the
Company would solicit the approval of the Merger and the Merger
Agreement by a vote of the stockholders of the Company. However,
there is no guarantee that such approval would be forthcoming.
Whether the Merger is effected pursuant to the "short-form"
merger provisions of applicable law, or pursuant to the
provisions requiring a stockholder vote, holders of Shares who
have not sold their Shares pursuant to the Offer (or otherwise)
will have certain rights under the NMBCA to dissent and demand
payment in cash of the fair value (as agreed by the stockholder
and the Company or as judicially determined) of their Shares. The
fair value so agreed or determined could be more or less than the
Offer Price and the Merger Consideration. See Sections 12 and 14.
This Offer to Purchase, the Letter of Transmittal and the
Schedule 14D-9 contain important information that should be read
carefully by stockholders before they make any decision whether
to tender their Shares pursuant to the 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 such extension or amendment), Purchaser will
accept for payment and pay for all Shares validly tendered and
not withdrawn as provided in Section 4 prior to the Expiration
Date. As used herein, the term "Expiration Date" shall mean 12:00
midnight, New York City time, on Wednesday, October 28, 1998,
- 2 -
<PAGE>
unless and until Purchaser shall, in its sole discretion, have
extended the period of time during which the Offer is open, in
which event the term "Expiration Date" shall mean the latest time
and date at which the Offer, as so extended by Purchaser, shall
expire. Subject to the terms of the Merger Agreement (as
described in Section 12), Purchaser may from time to time extend
the Expiration Date.
The Offer is subject to the conditions set forth in Section
14, including, among other things, expiration or termination of
all waiting periods imposed by the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the "HSR Act") and the
Minimum Condition being satisfied. See Sections 14 and 15.
Subject to the applicable rules and regulations of the
Commission and the Merger Agreement, Purchaser expressly reserves
the right (but will not be obligated) to, at any time and from
time to time in its sole discretion, waive any condition to the
Offer in whole or in part in its sole discretion. In addition,
subject to the applicable rules and regulations of the
Commission, Purchaser expressly reserves the right at any time
and from time to time to modify or amend the terms of the Offer;
provided that under the Merger Agreement, Purchaser has agreed
that it will not, without the prior written consent of the
Company, (1) decrease or change the amount or form of the
consideration payable in the Offer, (2) decrease the number of
Shares sought pursuant to the Offer, (3) impose additional
conditions to the Offer, (4) change the conditions to the Offer
(provided that Purchaser in its sole discretion may waive any
conditions to the Offer), or (5) make any change to any other
provision of the Offer that is materially adverse to the holders
of the Shares.
If the conditions set forth in Section 14 are not satisfied
or waived by Parent or Purchaser as of any scheduled expiration
date, Purchaser may extend the Offer from time to time as
described in Section 12; provided, that Purchaser is not
obligated to make any such extension.
Subject to the limitations set forth in the Merger
Agreement (as described in Section 12), Purchaser reserves the
right (but will not be obligated), at any time or from time to
time in its sole discretion, to extend the period during which
the Offer is open by giving oral or written notice of such
extension to the Depositary and by making a public announcement
of such extension. There can be no assurance that Purchaser will
exercise its right to extend the Offer.
Subject to the Merger Agreement and applicable rules and
regulations of the Commission, including Rule 14e-1(c) under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"),
relating to Purchaser's obligation to pay for or return tendered
Shares promptly after the termination or withdrawal of the Offer,
and to the provisions of the Merger Agreement, Purchaser
expressly reserves the right to delay acceptance for payment of
or payment for any Shares, to extend the Offer, or to terminate
the Offer and not to accept for payment or pay for any Shares not
theretofore accepted for payment or paid for, upon the failure of
any of the conditions specified in paragraphs (a) through (n) of
Section 14 to be fulfilled, and at any time or from time to time,
to amend the Offer or to waive any conditions to the Offer in any
respect consistent with the provisions of the Merger Agreement,
as such provisions may be amended from time to time, in each case
by giving oral or written notice of such delay, extension,
termination, amendment or waiver to the Depositary.
Any such extension of the period during which the Offer is
open, delay in acceptance for payment or payment, termination or
amendment of the Offer or waiver of any conditions to the Offer
will be followed, as promptly as practicable, by public
announcement thereof, such announcement in the case of an
extension to be issued not later than 9:00 a.m., New York City
time, on the next business day after the previously scheduled
Expiration Date in accordance with the public announcement
requirements of Rule 14d-4(c) under the Exchange Act. Without
limiting the obligation of Purchaser under such rule or other
applicable law or the manner in which Purchaser may choose to
make any public announcement, Purchaser currently intends to make
announcements by issuing a press release to the PR Newswire and
making any appropriate filing with the Commission. As used in
this Offer, "business day" means any day other than a Saturday,
Sunday or a U.S. federal holiday, and consists of the time period
from 12:01 a.m. through 12:00 Midnight, New York City time.
If 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 (including a waiver of the
Minimum Condition), Purchaser will disseminate additional tender
offer materials and extend the Offer if and to the extent
required by Rules 14d-4(c), 14d-6(d) and 14e-1 under the Exchange
Act. The minimum period during which a tender offer must remain
open
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following a material change in the terms of the Offer or
information concerning the Offer, other than a change in the
price or in the number of Shares sought, will depend on the facts
and circumstances then existing, including the relative
materiality of the changes. With respect to a change in the price
or number of Shares sought, a minimum of ten business days from
the date of such change is generally required under applicable
Commission rules and regulations to permit adequate disclosure to
stockholders.
The Company has provided Purchaser with the Company's
stockholder lists and security position listings for the purpose
of disseminating the Offer to stockholders. This Offer to
Purchase, the related Letter of Transmittal and certain other
relevant materials will be mailed to record holders of Shares and
will be furnished to brokers, dealers, commercial banks, trust
companies and similar persons whose names, or the names of whose
nominees, appear on the Company's stockholder lists or, if
applicable, who are listed as participants in a clearing agency's
security position listing, for subsequent transmittal to
beneficial owners of Shares.
2. Acceptance for Payment and Payment for Shares
Upon the terms and subject to the conditions of the Offer
(including, if the Offer is extended or amended, the terms and
conditions of any such extension or amendment) and the terms and
conditions of the Merger Agreement, Purchaser will accept for
payment, and pay for, all Shares validly tendered and not
properly withdrawn prior to the Expiration Date, promptly after
the latter of (i) the Expiration Date and (ii) subject to
compliance with Rule 14e-1(c) under the Exchange Act, the date of
satisfaction or waiver of all of the conditions of the Offer set
forth in Section 14 (including expiration or termination of the
waiting period under the HSR Act) applicable to the acquisition
of Shares pursuant to the Offer. Any determination concerning the
satisfaction of such terms and conditions is within the
reasonable discretion of Purchaser and such determination will be
final and binding on all tendering stockholders. See Section 14.
Subject to compliance with Rule 14e-1(c) under the Exchange Act
and the terms and conditions of the Merger Agreement, Purchaser
expressly reserves the right, in its discretion, to delay
acceptance for payment of or payment for Shares in order to
comply, in whole or in part, with any applicable law or
government regulation or any condition contained herein. See
Sections 14 and 15.
In all cases, payment for Shares purchased pursuant to the
Offer will be made only after timely receipt by the Depositary of
(i) certificates evidencing such Shares (or a timely Book-Entry
Confirmation (as defined in Section 3) with respect to such
Shares), (ii) the Letter of Transmittal (or a manually signed
facsimile thereof), properly completed and duly executed with all
required signature guarantees or an Agent's Message, as defined
below, in connection with a book-entry transfer, and (iii) all
other documents required by the Letter of Transmittal. See
Section 3. The term "Agent's Message" means a message,
transmitted by the Book-Entry Transfer Facility (as defined in
Section 3) to, and received by, the Depositary and forming a part
of a Book-Entry Confirmation, which states that the Book-Entry
Transfer Facility has received an express acknowledgment from the
participant in the Book-Entry Transfer Facility tendering the
Shares, which are the subject of such Book-Entry Confirmation,
that such participant has received and agrees to be bound by the
terms of the Letter of Transmittal and that Purchaser may enforce
such agreement against such participant.
For purposes of the Offer, Purchaser will be deemed to have
accepted for payment, and thereby purchased, Shares validly
tendered and not withdrawn as, if and when Purchaser gives oral
or written notice to the Depositary of Purchaser's acceptance of
such Shares for payment. In all cases, payment for Shares
purchased pursuant to the Offer will be made by deposit of the
purchase price therefor with the Depositary, which will act as
agent for tendering stockholders for the purpose of receiving
payment from Purchaser and transmitting payment to tendering
stockholders whose Shares have theretofore been accepted for
payment. If, for any reason, acceptance for payment of any Shares
tendered pursuant to the Offer is delayed, or Purchaser is unable
to accept for payment Shares tendered pursuant to the Offer,
then, without prejudice to Purchaser's rights under Section 14,
the Depositary may, nevertheless, on behalf of Purchaser, retain
tendered Shares, and such Shares may not be withdrawn, except to
the extent that the tendering stockholders are entitled to
withdrawal rights as described in Section 4 and as otherwise
required by Rule 14e-1(c) under the Exchange Act. UNDER NO
CIRCUMSTANCES WILL INTEREST ON THE OFFER PRICE BE PAID BY
PURCHASER, REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY DELAY
IN MAKING SUCH PAYMENT.
If any tendered Shares are not purchased for any reason or
if certificates are submitted for more Shares than are tendered,
certificates for such Shares not purchased or tendered will be
returned pursuant to the instructions of the tendering
stockholder without expense to the tendering stockholder (or, in
the case of Shares delivered by
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<PAGE>
book-entry transfer into the Depositary's account at the
Book-Entry Transfer Facility pursuant to the procedures set forth
in Section 3, such Shares will be credited to an account
maintained at the Book-Entry Transfer Facility) as promptly as
practicable following the expiration, termination or withdrawal
of the Offer.
If, prior to the Expiration Date, Purchaser (in its sole
discretion) increases the consideration to be paid per Share
pursuant to the Offer, Purchaser will pay such increased
consideration for all such Shares purchased pursuant to the
Offer, whether or not such Shares were tendered prior to such
increase in consideration.
Purchaser reserves the right, subject to the terms of the
Merger Agreement, at any time, to assign, in its sole discretion,
to one or more affiliates of Purchaser the right to purchase all
or any portion of the Shares tendered pursuant to the Offer, but
any such assignment will not relieve Purchaser of its obligations
under the Offer and will in no way prejudice the rights of
tendering stockholders to receive payment for Shares validly
tendered and accepted for payment pursuant to the Offer.
Notwithstanding anything to the contrary herein, Purchaser
cannot and will not assert any of the conditions set forth under
Section 14 (other than certain regulatory conditions as, and to
the extent, permitted by applicable rules and regulations of the
Commission) at any time after the Expiration Date.
3. Procedure for Tendering Shares
Valid Tenders. For Shares to be validly tendered pursuant
to the Offer, either (a) a Letter of Transmittal (or a manually
signed facsimile thereof), properly completed and duly executed,
with any required signature guarantees, or an Agent's Message in
connection with a book-entry delivery of Shares and any other
required documents, must be received by the Depositary at the
address set forth on the back cover of this Offer to Purchase
prior to the Expiration Date, and either (i) certificates
representing Shares must be received by the Depositary at any
such address on or prior to the Expiration Date or (ii) such
Shares must be delivered pursuant to the procedures for
book-entry transfer set forth below and a Book-Entry Confirmation
must be received by the Depositary, in each case prior to the
Expiration Date, or (b) the tendering stockholder must comply
with the guaranteed delivery procedures set forth below. No
alternative, conditional or contingent tenders will be accepted.
Book-Entry Transfer. The Depositary will establish an
account with respect to the Shares at The Depository Trust
Company (the "Book-Entry Transfer Facility") for purposes of the
Offer within two business days after the date of this Offer to
Purchase. Any financial institution that is a participant in the
Book-Entry Transfer Facility's system may make book-entry
delivery of Shares by causing the Book-Entry Transfer Facility to
transfer such Shares into the Depositary's account at the
Book-Entry Transfer Facility in accordance with the Book-Entry
Transfer Facility's procedure for such transfer. However,
although delivery of Shares may be effected through book-entry
transfer into the Depositary's account at the Book-Entry Transfer
Facility, the Letter of Transmittal (or a manually signed
facsimile thereof), properly completed and duly executed, with
any required signature guarantees (or an Agent's Message in
connection with a book-entry transfer) and any other required
documents, must, in any case, be transmitted to, and received by,
the Depositary at one of its addresses set forth on the back
cover of this Offer to Purchase on or prior to the Expiration
Date, or the tendering stockholder must comply with the
guaranteed delivery procedures described below. The confirmation
of a book-entry transfer of Shares into the Depositary's account
at the Book-Entry Transfer Facility as described above is
referred to herein as the "Book-Entry Confirmation." DELIVERY OF
DOCUMENTS (INCLUDING AN EXECUTED LETTER OF TRANSMITTAL) TO THE
BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH THE BOOK-ENTRY
TRANSFER FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO
THE DEPOSITARY.
Signature Guarantees. Signatures on all Letters of
Transmittal must be guaranteed by a member in good standing of
the Securities Transfer Agent's Medallion Program, or by any
other bank, broker, dealer, credit union, savings association or
other entity that is an "eligible guarantor institution," as such
term is defined in Rule 17Ad-15 under the Exchange Act, (each of
the foregoing constituting an "Eligible Institution") unless the
Shares tendered thereby are tendered (i) by a registered holder
(which term, for purposes of this Section, includes any
participant in any of the Book-Entry Transfer Facility systems
whose name appears on a security position listing as the owner of
the Shares) of Shares who has not completed either the box
labeled "Special Delivery Instructions" or the box labeled
"Special Payment Instructions" on the Letter of Transmittal or
(ii) for the account of an Eligible Institution. See Instruction
1 of the Letter of Transmittal. If a certificate representing
Shares is registered in the name of a
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person or persons other than the signer of the Letter of
Transmittal, or if payment is to be made or certificates for
Shares not accepted for payment or not tendered are to be issued
or returned to a person other than the registered holder, then
such certificate must be endorsed or accompanied by appropriate
stock powers, in each case signed exactly as the name or names of
the registered holder or holders appear on the certificates, with
the signatures on the certificates or stock powers guaranteed by
an Eligible Institution as described above and as provided in the
Letter of Transmittal. See Instructions 1 and 5 of the Letter of
Transmittal.
Guaranteed Delivery. If a stockholder desires to tender
Shares pursuant to the Offer and such stockholder's certificates
are not immediately available or the procedures for book-entry
transfer cannot be completed on a timely basis or time will not
permit all required documents to reach the Depositary on or prior
to the Expiration Date, such Shares may nevertheless be tendered
if all of the following guaranteed delivery procedures are
complied with:
(i) such tender is made by or through an Eligible
Institution;
(ii) a properly completed and duly executed Notice of
Guaranteed Delivery, substantially in the form provided by
Purchaser herewith, is received by the Depositary, as provided
below, prior to the Expiration Date; and
(iii) the certificates for all tendered Shares in proper
form for transfer, or a Book-Entry Confirmation with respect to
all tendered Shares, in either case together with a properly
completed and duly executed Letter of Transmittal (or a manually
signed facsimile thereof), with any requested signature
guarantees (or, in the case of a book-entry transfer, an Agent's
Message), and any other documents required by the Letter of
Transmittal, are received by the Depositary within three trading
days after the date of execution of such Notice of Guaranteed
Delivery. A "trading day" is any day except Saturday, Sunday or a
federal holiday.
The Notice of Guaranteed Delivery may be delivered by hand
or transmitted by facsimile transmission or mail to the
Depositary and must include an endorsement by an Eligible
Institution in the form set forth in such Notice of Guaranteed
Delivery.
The method of delivery of certificates for Shares, the
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 stockholder. If delivery is made
by mail, registered mail with return receipt requested, properly
insured, is recommended. In all cases, sufficient time should be
allowed to ensure timely delivery.
Notwithstanding any other provision hereof, payment for
Shares accepted for payment pursuant to the Offer in all cases
will be made only after timely receipt by the Depositary of (i)
certificates for (or a Book-Entry Confirmation with respect to)
such Shares, (ii) a Letter of Transmittal (or a manually signed
facsimile thereof), properly completed and duly executed, with
any required signature guarantees, or an Agent's Message, and
(iii) all other documents required by the Letter of Transmittal.
Backup Withholding. In order to avoid "backup withholding"
of U.S. federal income tax on payments of cash pursuant to the
Offer, a stockholder surrendering Shares in the Offer must,
unless an exemption applies, provide the Depositary with such
stockholder's correct taxpayer identification number ("TIN") on a
Substitute Form W-9 and certify under penalties of perjury that
such TIN is correct and that such stockholder is not subject to
backup withholding. If a stockholder does not provide such
stockholder's correct TIN or fails to provide the certifications
described above, the Internal Revenue Service (the "IRS") may
impose a penalty on such stockholder and payment of cash to such
stockholder pursuant to the Offer may be subject to backup
withholding of 31%. All stockholders surrendering Shares pursuant
to the Offer should complete and sign the main signature form and
the Substitute Form W-9 included as part of the Letter of
Transmittal to provide the information and certification
necessary to avoid backup withholding (unless an applicable
exemption exists and is proved in a manner satisfactory to
Purchaser and the Depositary). Certain stockholders (including,
among others, all corporations and certain foreign individuals
and entities) are not subject to backup withholding. Noncorporate
foreign stockholders should complete and sign the main signature
form and a Form W-8, Certificate of Foreign Status, a copy of
which may be obtained from the Depositary, in order to avoid
backup withholding. See Instruction 8 to the Letter of
Transmittal.
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<PAGE>
Determination of Validity. All questions as to the form of
documents and the validity, eligibility (including time of
receipt) and acceptance for payment of any tender of Shares
pursuant to any of the procedures described above will be
determined by Purchaser in its sole discretion, which
determination shall be final and binding on all parties.
Purchaser reserves the absolute right to reject any or all
tenders of Shares that are determined by it not to be in proper
form or the acceptance of or payment for which, in the opinion of
Purchaser, may be unlawful. Purchaser also reserves the absolute
right to waive any defect or irregularity in any tender of
Shares. Purchaser's interpretation of the terms and conditions of
the Offer (including the Letter of Transmittal and the
instructions thereto) will be final and binding on all parties.
No tender of Shares will be deemed to have been validly made
until all defects and irregularities have been cured or waived.
None of Purchaser, Parent, the Depositary, the Information Agent
or any other person will be under any duty to give notification
of any defects or irregularities in tenders or incur any
liability for failure to give any such notification.
Appointment as Proxy. By executing a Letter of Transmittal,
a tendering stockholder irrevocably appoints designees of
Purchaser as such stockholder's attorney-in-fact and proxy, each
with full power of substitution, in the manner set forth in the
Letter of Transmittal, to the full extent of such stockholder's
rights with respect to the Shares tendered by such stockholder
and accepted for payment by Purchaser (and with respect to any
and all other Shares or other securities issued or issuable in
respect of such Shares on or after the date of the Offer). All
such powers of attorney and proxies shall be considered coupled
with an interest in the tendered Shares. Such powers of attorney
and proxies shall be irrevocable and shall be effective when, and
only to the extent that, Purchaser accepts such Shares for
payment. Upon such acceptance for payment, all prior powers of
attorney or proxies given by such stockholder with respect to
such Shares (and any other Shares or other securities so issued
in respect of such purchased Shares) will be revoked, without
further action, and no subsequent powers of attorney or proxies
may be given (and, if given, will not be deemed effective) by
such stockholder. The designees of Purchaser will be empowered to
exercise all voting and other rights of such stockholder with
respect to such Shares (and any other Shares or securities so
issued in respect of such accepted Shares) as they in their sole
discretion may deem proper, including, without limitation, in
respect of any annual or special meeting of the Company's
stockholders, or any adjournment or postponement thereof, or in
connection with any action by written consent in lieu of any such
meeting or otherwise (including any such meeting or action by
written consent to approve the Merger). Purchaser reserves the
absolute right to require that, in order for Shares to be validly
tendered, immediately upon Purchaser's acceptance for payment of
such Shares, Purchaser must be able to exercise full voting and
other rights with respect to such Shares (and any other Shares or
securities so issued in respect of such accepted Shares),
including voting at any meeting of stockholders then scheduled or
giving or withdrawing written consents as to which the record
date has passed.
Binding Agreement. A valid tender of Shares will constitute
the tendering stockholder's acceptance of the terms and
conditions of the Offer. Purchaser's acceptance for payment of
Shares tendered pursuant to the Offer will constitute a binding
agreement between the tendering stockholder and Purchaser upon
the terms and subject to the conditions of the Offer.
4. Withdrawal Rights
Except as otherwise provided in this Section 4, tenders of
Shares made pursuant to the Offer are irrevocable. Shares
tendered pursuant to the Offer may be withdrawn at any time prior
to the Expiration Date and, unless theretofore accepted for
payment by Purchaser as provided herein, may also be withdrawn at
any time after November 27, 1998 If Purchaser extends the Offer,
is delayed in its purchase of or payment for Shares or is unable
to purchase or pay for Shares for any reason, then, without
prejudice to the rights of Purchaser hereunder, tendered Shares
may be retained by the Depositary on behalf of Purchaser and may
not be withdrawn except to the extent that tendering stockholders
are entitled to withdrawal rights as set forth in this Section 4.
The reservation by Purchaser of the right to delay the acceptance
or purchase of or payment for Shares is subject to the provisions
of Rule 14e-1(c) under the Exchange Act, which requires Purchaser
to pay the consideration offered or return Shares deposited by or
on behalf of stockholders promptly after the termination or
withdrawal of the Offer.
For a withdrawal of tendered Shares to be effective, a
written or facsimile transmission notice of withdrawal must be
timely received by the Depositary at the address 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
Shares to be withdrawn, the number of Shares to be withdrawn and
the name of the registered holder, if different from that of the
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person who tendered such Shares. If certificates evidencing
Shares to be withdrawn have been delivered or otherwise
identified to the Depositary, then prior to the physical release
of such certificates, the tendering stockholder must also submit
the serial numbers shown on such certificates, and the
signature(s) on the notice of withdrawal must be guaranteed by an
Eligible Institution (except in the case of Shares tendered for
the account of an Eligible Institution). If Shares have been
tendered pursuant to the procedure for book-entry transfer set
forth in Section 3, any notice of withdrawal with respect to such
Shares must specify the name and number of the account at the
Book-Entry Transfer Facility to be credited with the withdrawn
Shares.
All questions as to the form and validity (including time
of receipt) of notices of withdrawal will be determined by
Purchaser, in its sole discretion, whose determination shall be
final and binding on all parties. No withdrawal of Shares shall
be deemed to have been properly made until all defects and
irregularities have been cured or waived. None of Purchaser,
Parent, the Depositary, the Information Agent or any other person
will be under any duty to give notification of any defects or
irregularities in any notice of withdrawal or incur any liability
for failing to give such notification.
Withdrawals of Shares may not be rescinded. Any Shares
properly withdrawn will be deemed not to have been validly
tendered for purposes of the Offer, but may be retendered at any
subsequent time prior to the Expiration Date by following any of
the procedures described in Section 3.
5. Certain U.S. Federal Income Tax Consequences
The following is a summary of the principal U.S. federal
income tax consequences of the Offer and the Merger to holders
whose Shares are purchased pursuant to the Offer or whose Shares
are converted into the right to receive cash in the Merger
(whether upon receipt of the Merger Consideration or upon receipt
of any cash amounts by dissenting stockholders pursuant to the
exercise of rights to fair value appraisal under the NMBCA). The
discussion applies only to holders of Shares in whose hands
Shares are capital assets, and may not apply to Shares received
pursuant to the exercise of employee stock options or otherwise
as compensation, or to holders of Shares who are not citizens or
residents of the United States.
The U.S. federal income tax consequences set forth below
are included for general informational purposes only and are
based upon present law. Individual circumstances may differ;
accordingly, each holder of Shares should consult such holder's
own tax advisor to determine the applicability of the rules
discussed below to such stockholder and the particular tax
effects of the Offer and the Merger, including the application
and effect of state, local and other tax laws.
The receipt of the Offer Price or the receipt of cash
pursuant to the Merger (whether as Merger Consideration or cash
amounts received by dissenting stockholders pursuant to the
exercise of appraisal rights) will be a taxable transaction for
U.S. federal income tax purposes (and also may be a taxable
transaction under applicable state, local and other income tax
laws). In general, for U.S. federal income tax purposes, a holder
of Shares will recognize gain or loss equal to the difference
between such holder's adjusted tax basis in the Shares sold
pursuant to the Offer or converted to cash in the Merger and the
amount of cash received therefor. Gain or loss must be determined
separately for each block of Shares (i.e., Shares acquired at the
same cost in a single transaction) sold pursuant to the Offer or
converted to cash in the Merger. Such gain or loss will be
capital gain or loss and will be long-term gain or loss if, on
the date of sale (or, if applicable, the date of the Merger), the
Shares were held for more than one year.
Payments in connection with the Offer or the Merger may be
subject to backup withholding at a 31% rate. Backup withholding
generally applies if the stockholder (a) fails to furnish such
stockholder's social security number or TIN, (b) furnishes an
incorrect TIN, (c) fails to properly report interest or dividends
or (d) under certain circumstances, fails to provide a certified
statement, signed under penalties of perjury, that the TIN
provided is such stockholder's correct number and that such
stockholder is not subject to backup withholding. Backup
withholding is not an additional tax but merely an advance
payment, which may be refunded to the extent it results in an
overpayment of tax. Certain persons generally are exempt from
backup withholding, including corporations and financial
institutions. Certain penalties apply for failure to furnish
correct information and for failure to include the reportable
payments in income. Each stockholder should consult with such
stockholder's own tax advisor as to such stockholder's
qualification for exemption from withholding and the procedure
for obtaining such exemption.
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6. Price Range of the Shares; Dividends
According to the Company's Annual Report on Form 10-KSB for
the year ended June 30, 1998 (the "Company 10-K"), there are
approximately 1,065 record holders of Shares. There is no
established trading market for the Shares and the Company is not
normally informed of the terms of transactions in its shares. The
Shares are traded sporadically over-the-counter. Set forth below
are the range of high and low bid quotations as reported on
Bloomberg L.P. for each quarter during the last two fiscal years.
The quotations listed below may reflect inter-dealer
transactions, without retail mark-up, mark-down, or commission.
They do not necessarily represent actual transactions and
management does not have knowledge of the volume of trading, if
any, at any of such bid prices.
Bryan Common Stock
Quarter Ended: High Ask Low Ask
-------- -------
September 30, 1996 40 1/2 37
December 31, 1996 38 37
March 31, 1997 39 1/2 38
June 30, 1997 50 39 1/2
September 30, 1997 50 50
December 31, 1997 63 1/2 53
March 31, 1998 65 7/16 63 1/2
June 30, 1998 67 1/4 65 7/16
September 30, 1998
(through September 28, 1998) 80 67 1/4
According to the Company 10-K and information supplied to
Purchaser by the Company, the Company paid dividends of $1.40 per
Share on September 15, 1995, $1.50 per Share on September 13,
1996, $2.00 per Share on September 15, 1997 and $2.00 per Share
on September 15, 1998.
On September 22, 1998, the last full trading day before the
execution of the Merger Agreement and the public announcement of
Purchaser's intention to make the Offer, the high and low bid
quotations, reported on Bloomberg L.P. were $80 and $67-1/4. On
July 20, 1998, the last date on which a bid in the Shares was
reported on Bloomberg L.P., the bid quotation was $80.
Stockholders are encouraged to obtain current market quotations
for the Shares.
7. Certain Effects of the Transaction
The purchase of Shares pursuant to the Offer will reduce
the number of Shares that might otherwise trade publicly and the
number of holders of Shares, which could adversely affect the
liquidity and market value of the remaining Shares held by the
public. According to the Company 10-K, as of June 30, 1998, there
were 1,065 recordholders of Bryan Common Stock and more than 300
beneficial holders whose shares are held of record by nominees.
The extent of the public market for the Shares and the
continued trading of the Shares over-the-counter after the
purchase of Shares pursuant to the Offer, will depend upon the
number of holders of Shares remaining at such time, the interest
in maintaining a market in such Shares on the part of securities
firms, the possible termination of registration of such Shares
under the Exchange Act, as described below, and other factors.
Depending on the number of Shares acquired pursuant to the Offer,
price quotations for the Shares may no longer meet the
requirements for continued trading over-the-counter. If, as a
result of the purchase of Shares pursuant to the Offer or
otherwise, trading of the Shares over-the-counter is
discontinued, the liquidity of and market for the Shares could be
adversely affected. Any reduction in the number of Shares that
might otherwise trade publicly may have an adverse effect on the
market price for or marketability of the Shares and may cause
future prices to be less than the Offer Price.
The Shares are currently registered under the Exchange Act.
Registration of the Shares under the Exchange Act may be
terminated upon application of the Company to the Commission if
the Shares are not listed on a national securities exchange and
there are fewer than 300 record holders of the Shares.
Termination of
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registration of the Shares 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, such as the
short-swing profit recovery provisions of Section 16(b) of the
Exchange Act, the requirement of furnishing a proxy statement in
connection with stockholders' meetings pursuant to Section 14(a)
or 14(c) of the Exchange Act, and the requirements of Rule 13e-3
under the Exchange Act with respect to "going private"
transactions, no longer applicable to the Company. In addition,
"affiliates" of the Company and persons holding "restricted
securities" of the Company, if any, may be deprived of the
ability to dispose of such securities pursuant to Rule 144
promulgated under the Securities Act of 1933, as amended.
It is the present intention of Purchaser to seek to cause
the Company to make an application for the termination of the
registration of the Shares under the Exchange Act as soon as
possible after the purchase of all validly tendered Shares in the
Offer if the requirements for termination of registration are
met. If registration of the Shares is not terminated prior to the
Merger, the registration of the Shares under the Exchange Act
will be terminated following consummation of the Merger. See
Section 12.
8. Certain Information Concerning the Company
Except as otherwise stated in this Offer to Purchase, the
information concerning the Company contained herein has been
taken from or based upon publicly available documents and records
on file with the Commission and other public sources including,
but not limited to, the Company 10-K. Although neither Parent nor
Purchaser has any knowledge that any statements contained herein
based on such documents and records are untrue, neither Parent
nor Purchaser takes any responsibility for the accuracy or
completeness of the information concerning the Company, furnished
by the Company or contained in such documents and records, or for
any failure by the Company to disclose events that may have
occurred and may affect the significance or accuracy of any such
information.
The Company was incorporated in New Mexico in 1916. Its
executive offices are located at P.O. Box 27, Peru, Indiana
46970. The Company manufactures boilers and boiler accessories
and operates a tank manufacturing facility.
Set forth below is a summary of certain selected financial
information with respect to the Company for the years ended June
30, 1998 and June 30, 1997. The June 30, 1998 and June 30, 1997
information were excerpted from the Company 10-K. More
comprehensive financial information is included in the Company
10-K and the following summary is qualified in its entirety by
reference to such report and the financial statements and other
financial information (including any related notes) contained
therein. The Company 10-K may be inspected and copies may be
obtained in the manner set forth below.
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<PAGE>
BRYAN STEAM CORPORATION
SELECTED CONSOLIDATED CONDENSED FINANCIAL DATA
(In Thousands, Except Share Data)
Audited
-------------------
1998 1997
--------- --------
Year Ended
June 30,
-------------------
Income Statement Data:
Gross sales less discounts,
returns and allowances $26,178 $26,233
Net income (loss) 988 1,609
Earnings (loss) Per Share* 5.17 8.41
Balance Sheet Data:
Total Assets 18,562 17,223
Total Liabilities 3,546 2,831
Stockholders' Equity 15,016 14,392
* Based on 191,284 Shares issued and outstanding throughout the
period.
The Company is subject to the information and reporting
requirements of the Exchange Act and, in accordance therewith, is
required to file periodic reports, proxy statements and other
information with the Commission relating to its business,
financial condition and other matters. Information as of
particular dates concerning the Company's directors and officers,
their remuneration, stock options and other matters, the
principal holders of the Company's securities and any material
interest of such persons in transactions with the Company is
required to be disclosed in proxy statements distributed to the
Company's stockholders and filed with the Commission. Such
reports, proxy statements and other information should be
available for inspection at the Commission's public reference
facilities at Room 1024, 450 Fifth Street, N.W., Washington, D.C.
20549 and also should be available for inspection and copying at
prescribed rates at the regional offices of the Commission
located at the Citicorp Center, 500 West Madison Street, Suite
1400, Chicago, IL 60661. Copies of such material may also be
obtained by mail at prescribed rates, from the Commission's
principal office at 450 Fifth Street, N.W., Washington, D.C.
20549. Such material may be obtained electronically by visiting
the Commission's web site on the Internet at http://www.sec.gov.
Prior to entering into the Merger Agreement, Parent and
Purchaser conducted a due diligence review of the Company and in
connection with such review, received certain non-public
information from the Company. The non-public information
included, among other things, financial estimates (the
"Estimates"). One of the Estimates was provided by Goelzer & Co.,
prepared in March, 1998, respecting potential operating results
for the fiscal year ending June 30, 2000. The other of the
Estimates was provided by McDonald & Co., prepared in June, 1998,
respecting potential operating results for the fiscal year ending
June 30, 1999. The Estimate respecting the year ending June 30,
1999, indicated that sales would increase at the rate of 5%, and
margins would remain consistent with those of prior years. For
the year ended June 30, 2000, the Estimate indicated net sales of
approximately $30.8 million and income from operations (pre-tax)
of approximately $3 million. The Company has advised Parent and
Purchaser that the Estimates were prepared by the Company's
management and the respective financial advisors based on
numerous assumptions, including among others, projections of
revenue, gross profit, operating expenses, depreciation and
amortization, taxes, capital expenditures and working capital
requirements. No assurances can be given with respect to any such
assumptions. None of the assumptions in the Estimates gives
effect to the Offer, the Merger or financing thereof or the
operations of the Company after consummation of such
transactions.
The Company has advised Purchaser that it does not as a
matter of course disclose estimates or projections as to future
revenues or earnings, and the Estimates were not prepared with a
view to public disclosure or compliance with published guidelines
of the Commission or the American Institute of Certified Public
Accountants for projections. The Estimates have not been
examined, reviewed or compiled by the Company's independent
auditors, and accordingly they have not expressed an opinion or
any other assurance on them. The forecasted
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<PAGE>
information is included herein solely because such information
was furnished to Parent and Purchaser or its financial advisors.
Accordingly, the inclusion of the Estimates in this Offer should
not be regarded as an indication that Parent or Purchaser or
their financial advisors or their respective officers and
directors consider such information to be accurate or reliable,
and none of such persons assumes any responsibility for the
accuracy or reliability thereof. The Estimates were prepared for
internal use and are subjective in many respects and thus
susceptible to various interpretations and periodic revision
based upon actual experience and business development. In
addition, because the estimates and assumptions underlying the
Estimates are inherently subject to significant economic and
competitive uncertainties and contingencies, which are difficult
or impossible to predict accurately and are beyond the control of
the Company, Parent and Purchaser, there can be no assurance that
the Estimates will be realized or that the Company's future
results will not vary materially from the Estimates.
9. Certain Information Concerning Purchaser and Parent
Purchaser, a New Mexico corporation, was organized to
acquire the Company and has not conducted any unrelated
activities since its organization. All of Purchaser's outstanding
stock is owned by Parent, a New York corporation. The principal
executive offices of Purchaser and Parent are located at 1241
Harrisburg Avenue, Lancaster PA, 17603. Parent is, itself and
through its subsidiaries, a major manufacturer of boilers,
furnaces, radiators and related equipment.
The name, citizenship, business address, present principal
occupation or employment and five-year employment history of each
of the directors and executive officers of Purchaser and Parent
is set forth in Annex I hereto and incorporated herein by
reference.
Parent and Purchaser are not subject to the informational
reporting requirements of the Exchange Act, and, accordingly, do
not file reports or other information with the Commission
relating to their respective business, financial condition or
other matters.
Set forth below is a summary of certain selected financial
information with respect to Parent for the six months ended June
30, 1998 and June 30, 1997, and for the years ended December 31,
1997 and December 31, 1996.
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<PAGE>
BURNHAM CORPORATION AND ITS SUBSIDIARIES
SELECTED CONSOLIDATED CONDENSED FINANCIAL DATA
(In Thousands, Except Per Share Data)
Unaudited Audited
------------------ ----------------
1998 1997 1997 1996
-------- --------
Six months ended, Year Ended
June 30, December 31,
-------------------------------------
Income Statement Data:
Net sales $72,564 $66,769 $174,593 $159,936
Net income (loss) 602 1,794 9,419 8,844
Earnings (loss)
Per Share* .26 .80 4.20 3.95
Balance Sheet Data:
Total Assets 124,317 112,266 127,642 114,285
Total Liabilities 55,045 48,307 57,752 50,916
Stockholders' Equity 69,272 63,959 69,890 63,369
- ---------------
* Based on 2,264, 2,238, 2,238 and 2,235 Shares issued and
outstanding for each respective period.
A copy of Parent's 1997 Annual Report containing audited
consolidated Balance Sheets as of December 31, 1997 and 1996 and
the related consolidated statements of income, stockholders'
equity and cash flows for the years then ended, as well as recent
unaudited financial statements, may be obtained by requesting the
same from Parent at the following address: Burnham Corporation,
P. O. Box 3205, Lancaster, PA 17604-3205, Telephone:
717-293-5800, Fax: 717-293-5816, Attention: Ronald L. Griffith.
10. Source and Amount of Funds
The total amount of funds required by Purchaser to purchase
all outstanding Shares pursuant to the Offer and to pay related
fees and expenses in connection with the Offer and the Merger is
estimated to be approximately $30.5 million. Purchaser expects to
obtain the necessary funds from Parent. Parent has sufficient
existing cash reserves and existing credit facilities with
available balances to satisfy its and Purchaser's obligations
under the Offer and the Merger Agreement. The Offer is not
conditioned upon any financing arrangements.
11. Background of the Transaction
On June 10, 1998, senior management of Parent and the
Company had initial discussions regarding the possible
acquisition of the Company by Parent. Parent was informed that
the Company would be sold through an "auction", which was to be
conducted by McDonald & Co., the Company's financial advisor.
Parent executed a confidentiality agreement and thereafter
received certain financial, corporate and other information
concerning the Company from McDonald & Co. and from Goelzer & Co.
Inc. ("Goelzer & Co."), a consultant specifically engaged by the
Company to arrange an offer for the Company supported by the
Company's management.
Senior management of Parent and the Company met on July 7,
1998 together with representatives of Goelzer & Co. further to
explore Parent's preliminary plans for the acquisition and to
discuss the views of the Company's management. Representatives of
Parent and Goelzer & Co. had further conversations concerning
Parent's plans during the period July 8, 1998 through July 20,
1998.
On July 21, 1998, based on the information received, Parent
submitted to McDonald & Co. a preliminary, non-binding proposal
for the acquisition of the Company at a cash price in the range
of $135.00 to $148.00 per share. This preliminary proposal was
endorsed by Goelzer & Co., which indicated that the proposal had
the support of the Company's management.
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<PAGE>
The Company thereafter invited Parent and its
representatives to conduct a further business review of the
Company, which the Company undertook between July 23, 1998 and
September 4, 1998.
On September 8, 1998, on the basis of its review and in
accordance with the auction procedures established by McDonald &
Co. and the Company, Parent submitted to McDonald & Co. a final
purchase proposal for the Company. Under this final proposal,
which was ultimately accepted in substantial part by the Company,
Parent offered to pay $152.00 per share net to holders of common
stock of the Company in the Merger. In addition, Parent agreed to
pay the transaction expenses incurred by the Company, and the
amounts to which senior managers of the Company would be entitled
upon certain changes in control of the Company. Parent's proposal
was subject to the condition (among other conditions) that the
Company solicit not more than ten stockholders of the Company and
that ten stockholders of the Company holding in the aggregate in
excess of 50% of the outstanding common shares of the Company
execute and deliver to Parent an option entitling Purchaser to
acquire their shares at $152.00 per share (as well as a proxy to
vote their shares in favor of the Merger).
On September 10, 1998, a meeting of the Board of the
Company was held at which the Company's outside legal counsel
advised the Board regarding its fiduciary duties under applicable
law, and representatives of McDonald & Co. made a presentation to
the Board with respect to the financial terms of the proposed
Merger Agreement, as well as the terms and status of other
proposals, which had been received from other entities during the
auction process. Representatives of McDonald & Co. also delivered
its oral opinion to the Board that the Merger was fair to such
holders from a financial point of view. After discussion, the
Board determined that further negotiations should take place with
Parent to finalize the Merger Agreement on a mutually acceptable
basis.
In subsequent negotiations on September 10 and 11, 1998
between Parent and the Company, in order to expedite the
acquisition, Parent requested that the transaction be
restructured from a single-step merger to a "two-step"
transaction consisting of a tender offer followed by a merger.
Parent also requested that the ten stockholders holding in excess
of 50% of the Company's common stock irrevocably agree to tender
their shares in such tender offer, and grant Parent a proxy to
vote their shares in favor of the Merger, pursuant to a
Stockholders' Agreement.
From September 10, 1998 through September 21, 1998, Parent
and the Company engaged in continued negotiations and document
preparation through their representatives. Based on discussions
with the Company, Parent understood that its proposal was
financially superior to all other proposals.
On September 21, 1998, the Board of the Company met again
to discuss the transaction, including the restructuring to a
"two-step" transaction. At this meeting, the Company's outside
legal counsel again advised the Board regarding its fiduciary
duties under applicable law, and representatives of McDonald &
Co. made a presentation to the Board with respect to the
financial terms of the proposed Offer and Merger. Representatives
of McDonald & Co. also delivered its written opinion to the Board
that the consideration to be received by the stockholders of the
Company in connection with the Offer and the Merger was fair to
such holders from a financial point of view. Based upon such
advice, such presentation and such opinion, the Board, subject to
finalization of the Merger Agreement in subsequent negotiations,
unanimously approved the Merger and the Offer.
Also on September 21, 1998, certain major stockholders of
the Company met with the Company's Chairman, its outside legal
counsel and representatives of McDonald & Co. to discuss the
background of the proposed transaction and the Stockholders'
Agreement. Between September 21, 1998 and September 23, 1998, ten
stockholders holding in the aggregate approximately 55.6% of the
outstanding common stock of the Company executed the
Stockholders' Agreement, which was dated as of September 23, 1998
and was held in escrow subject to the execution of the final
Merger Agreement.
On September 23, 1998, Parent, Purchaser and the Company
executed and delivered the Merger Agreement, and Parent and
Purchaser executed and delivered the Stockholders' Agreement. The
transaction was publicly announced on September 23, 1998, and, on
September 29, 1998, Purchaser commenced the Offer.
- 14 -
<PAGE>
12. Purpose of the Offer; The Merger Agreement; The Stockholders'
Agreement.
General
The purpose of the Offer, the Merger and the Stockholders'
Agreement is to enable Parent to acquire, in one or more
transactions, control of, and the entire equity interest in, the
Company. An additional purpose of the Merger is for Parent to
acquire all Shares not tendered and purchased pursuant to the
Offer. The acquisition of the entire equity interest in the
Company is structured as a cash tender offer followed by a merger
in order to provide a prompt and orderly transfer of ownership of
the Company from the public stockholders to Parent.
If the Minimum Condition is satisfied, Purchaser will own
at least 66-2/3% plus one of the then outstanding Shares. In that
event, the Company will call a stockholders meeting, if required,
and Purchaser will vote such Shares to approve the Merger
Agreement and the Merger. A vote of a two-thirds majority of
outstanding Shares is required under the NMBCA to approve a
merger, and as such, Purchaser believes that if the Minimum
Condition is satisfied the resolution in favor of the Merger will
pass and the Merger will be approved. If at least 90% of the then
outstanding Shares are tendered pursuant to the Offer, Purchaser
will be able to approve the Merger Agreement and the Merger and
to effect the Merger pursuant to the "short-form" merger
provisions of Section 53- 14-5 of the NMBCA without prior notice
to, or any action by, any other stockholder of the Company. On
the other hand, if the Minimum Condition is not satisfied and
such condition is waived by Purchaser in its sole discretion, and
thereafter the Offer is concluded with Purchaser owning not more
than 66-2/3% of the Shares then outstanding, then the Company
will call a stockholders meeting and Purchaser will vote in favor
of the Merger whatever Shares it does acquire pursuant to the
Offer. In such event, however, no assurance can be given that the
affirmative vote of holders of a two-thirds majority of the
Shares would be obtained at a special stockholders' meeting
called for such purpose as required to approve the Merger. See
Introduction and Section 15.
Upon consummation of the Merger, the Company will become a
wholly-owned subsidiary of Parent. The Offer is being made
pursuant to the Merger Agreement.
The Merger Agreement. The following is a summary of the
material terms of the Merger Agreement. This summary is not a
complete description of the terms and conditions thereof and is
qualified in its entirety by reference to the full text thereof,
which is incorporated herein by reference and a copy of which has
been filed with the Commission as an exhibit to the Tender Offer
Statement on Schedule 14D-1 (the "Schedule 14D-1") filed in
connection with the Offer. The Schedule 14D-1 (including the
Merger Agreement and other exhibits) may be examined, and copies
thereof may be obtained, in the manner set forth in Section 8
with respect to the Company 10-K (except that such Schedule will
not be available at the regional offices of the Commission).
The Offer. The Merger Agreement provides for the
commencement of the Offer, in connection with which Parent or
Purchaser has expressly reserved the right to waive conditions of
the Offer, in whole or in part, at any time and from time to time
in their sole discretion. Purchaser has agreed, however, that it
will not, without the prior written consent of the Company, (i)
decrease or change the amount or form of consideration payable in
the Offer, (ii) decrease the number of Shares sought pursuant to
the Offer, (iii) impose additional conditions to the Offer, (iv)
change the conditions of the Offer (provided that Parent or
Purchaser in their sole discretion may waive any of the
conditions to the Offer) or (v) make any change to any other
provision of the Offer that is materially adverse to the holders
of the Shares. Purchaser is entitled to extend the Offer in
accordance with applicable law as follows: (i) if any of the
conditions to the Offer are not satisfied or waived by Purchaser
as of any scheduled expiration date, then Purchaser may extend
the Offer from time to time until the earlier of (a) the
consummation of the Offer or (b) twenty business days following
the original expiration date of the Offer specified herein, and
(ii) if all conditions to the Offer are satisfied or waived as of
any scheduled expiration date, then Purchaser may extend the
Offer from time to time by not more than ten business days in the
aggregate. The obligation of Purchaser to consummate the Offer
and to accept for payment and to pay for any Shares tendered
pursuant to the Offer will be subject only to the conditions set
forth in Section 14.
For a description of the conditions to the Offer, see
Section 14.
The Merger. The Merger Agreement provides that, upon the
terms and subject to the conditions of the Merger Agreement, and
in accordance with the relevant provisions of the NMBCA,
Purchaser shall be merged with
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<PAGE>
and into the Company as soon as practicable following the
satisfaction or waiver of the conditions to the Merger. The
Company shall be the Surviving Corporation and shall continue its
existence under the laws of New Mexico, and the Certificate of
Incorporation and the Bylaws of Purchaser as in effect
immediately prior to the Effective Time shall be the Certificate
of Incorporation and Bylaws of the Surviving Corporation (except
the name of the Surviving Corporation shall be Bryan Steam
Corporation). H. Jesse McVay, Albert Morrison III and Ronald L.
Griffith will be the initial directors of the Surviving
Corporation and H. Jesse McVay (President), Ronald L. Griffith
(Vice President), Kurt J. Krauskopf (Treasurer, Comptroller and
Secretary), Robert Berardi (Assistant Treasurer) and Tammy McEwen
(Assistant Secretary) will be the initial officers of the
Surviving Corporation. Each Share issued and outstanding
immediately prior to the Effective Time (other than Shares owned
by Parent, Purchaser or any subsidiary of Parent, Purchaser or
the Company or held in the treasury of the Company, all of which
shall be canceled, and other than Dissenting Shares, as defined
herein) shall, by virtue of the Merger and without any action on
the part of the holder thereof, be converted into the right to
receive in cash the Merger Consideration, upon the surrender of
the certificate representing such Shares. The parties to the
Merger Agreement shall cause the Merger to be consummated by
filing with the Corporation Commission of the State of New Mexico
or its successor duly prepared and executed Articles of Merger,
as required by the NMBCA. The Merger will become effective upon
such filing or at such time thereafter as is provided under
applicable law.
Stockholder Meeting; Recommendation to Stockholders. Unless
the Merger is consummated in accordance with the "short-form"
merger provisions under the NMBCA, and subject to applicable law,
the Company shall, through its Board of Directors, duly call,
give notice of, convene and hold a special meeting of its
stockholders (the "Stockholder Meeting") for the purpose of
voting on the adoption of the plan of merger set forth in the
Merger Agreement as soon as reasonably practicable following the
consummation of the Offer but in any event prior to the 90th day
after the date of the Merger Agreement (subject to certain
unavoidable delays outside the control of the parties). Except to
the extent legally required for the discharge of the Board of
Directors' fiduciary duties as reflected in a written opinion of
independent legal counsel, Bryan shall, through its Board of
Directors, include in the Proxy Statement the recommendation of
the Board of Directors of Bryan that the stockholders of Bryan
adopt the Merger Agreement and approve the Merger, and the
Company is required to use all reasonable efforts to obtain the
adoption and approval of its stockholders. Parent and Purchaser
have agreed that, at the Stockholder Meeting, all of the Shares
acquired pursuant to the Offer or otherwise by Parent or
Purchaser or any of their affiliates will be voted in favor of
the Merger.
If Purchaser or any other direct or indirect subsidiary of
Parent shall acquire at least 90 percent of the outstanding
Shares, each of Parent, Purchaser and the Company may, if
Purchaser so elects, take all necessary and appropriate action to
cause the Merger to become effective, as soon as practicable
after the consummation of the Offer, without a meeting of
stockholders of the Company, in accordance with Section 53-14-5
of the NMBCA.
Representations and Warranties. The Merger Agreement
contains various representations and warranties of the parties
thereto. These include representations and warranties by the
Company with respect to corporate existence and good standing,
capital structure, subsidiaries, corporate authorization, absence
of changes, Commission filings, consents and approvals, no
defaults under agreements, investment banking fees, employee
benefits, labor relations, litigation, taxes, compliance with
applicable laws, environmental matters, intellectual property,
real property, insurance, material contracts, and other matters.
Purchaser and Parent have also made certain representations
and warranties with respect to corporate existence and good
standing, corporate authorization, consents and approvals, no
violations of other agreements and other matters.
Conduct of Business and Other Covenants Pending the Merger.
The Company has agreed that, except as expressly contemplated or
permitted by the Merger Agreement (or to the extent that Parent
may otherwise grant prior consent in writing, which consent shall
not be unreasonably withheld), during the period from the date of
the Merger Agreement to the Effective Time, the Company will
conduct its business only in, and the Company will cause each of
its subsidiaries not to take any action except in, the ordinary
course consistent with past practice (subject to the further
limitations specified in the Merger Agreement). In addition, the
Company has agreed that it will, and it will cause its
subsidiaries to use, all commercially reasonable efforts to
preserve intact in all material respects its present business
organization and reputation, to keep available the services of
its key officers and employees, to maintain its assets and
properties in good working order and condition (ordinary wear and
tear
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<PAGE>
excepted), to preserve its relationships with customers and
suppliers and others having significant business dealings with
them, to comply in all material respects with all laws and orders
of all governmental or regulatory authorities applicable to them,
and to maintain insurance (subject to consulting with Parent
prior to renewing any insurance policy), including, without
limitation, product liability insurance, in such amounts and
against such risks and losses as was in effect on June 30, 1998
(subject to the specific reinstatement of product liability
insurance for one of the Company's subsidiaries).
In addition, without limiting the generality of the
foregoing and except as expressly contemplated or permitted by
the Merger Agreement, during the period specified in the first
sentence of the preceding paragraph, the Company has agreed that,
without the prior written consent of Parent, it will not (and
will cause its subsidiaries not to):
(i) amend or propose to amend its or their Articles
of Incorporation or By-laws;
(ii) (w) declare, set aside or pay any dividends on or
make other distributions in respect of any of its capital
stock other than the dividend of $2.00 per share declared
on the Shares on August 26, 1998 and payable on September
15, 1998; (x) split, combine, reclassify or take similar
action with respect to any of its capital stock or issue or
authorize or propose the issuance of any other securities
or option in respect of, in lieu of or in substitution for
Shares; (y) adopt a plan of complete or partial liquidation
or resolutions providing for or authorizing such
liquidation or a dissolution, merger, consolidation,
restructuring, recapitalization or other reorganization; or
(z) directly or indirectly redeem, repurchase or otherwise
acquire any Shares or any option with respect thereto;
(iii) issue, deliver or sell, or authorize or propose
the issuance, delivery or sale of, any Shares or any option
with respect thereto, or modify or amend any right of any
holder of outstanding Shares or options with respect
thereto;
(iv) acquire (by merging or consolidating with, or by
purchasing a substantial equity interest in or a
substantial portion of the assets of, or by any other
manner) any business or any corporation, partnership,
association or other business organization or division
thereof or otherwise acquire or agree to acquire any assets
other than raw materials and supplies acquired in the
ordinary course of its business consistent with past
practice in amounts in any one instance (or group of
related instances) not in excess of $250,000 and in each
case pursuant to an order or agreement requiring delivery
of such raw materials and supplies within 120 days after
the creation of such order or agreement;
(v) sell, lease, grant any security interest in or
otherwise dispose of or encumber any of its assets or
properties other than finished goods in the ordinary course
of business consistent with past practice pursuant to
orders as to which (x) no one order (or group of related
orders) involves an aggregate selling price in excess of
$150,000, and (y) (i) each order is to be fully performed
within 150 days after its creation or (ii) in the case of
orders for which there is no definite date by which the
orders must be fully performed, the aggregate selling price
for all such orders that are more than 150 days old shall
not exceed $500,000;
(vi) except to the extent required by applicable law
or generally accepted accounting principals, (x) permit any
material change in (A) any pricing, marketing, purchasing,
investment, accounting, financial reporting, inventory,
receivable, credit, allowance or tax practice or policy or
(B) any method of calculating any bad debt, contingency or
other reserve for accounting, financial reporting or tax
purposes or (y) make any material tax election or settle or
compromise any material income tax liability with any
governmental or regulatory authority;
(vii) (x) other than working capital borrowings of up
to $300,000 under the Company's existing bank line of
credit, incur any indebtedness for borrowed money (which
shall be deemed for this purpose to include entering into
credit agreements, lines of credit or similar arrangements,
whether or not amounts are borrowed thereunder) or
guarantee any such indebtedness, or (y) voluntarily
purchase, cancel, prepay or otherwise provide for a
complete or partial discharge in advance of a scheduled
repayment date with respect to, or waive any right under,
any indebtedness for borrowed money;
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<PAGE>
(viii) (x) enter into, adopt, amend in any material
respect (except as may be required by applicable law) or
terminate any Company benefit plan or other agreement
between the Company (or any of its subsidiaries) and one or
more of its directors, officers or employees, or (y)
increase in any manner the compensation or fringe benefits
of any director, officer or employee or pay any benefit not
required by any plan or arrangement in effect as of the
date hereof (except that the Company shall comply with the
union contract and except for normal increases approved by
Parent);
(ix) enter into any new contract or amend, modify or
terminate any existing contract, or engage in any new
transaction (x) not in the ordinary course of business
consistent with past practice, (y) not on an arm's length
basis, or (z) with any stockholder or affiliate of the
Company;
(x) make any capital expenditure or any commitment to
make a capital expenditure or any commitment for additions
to plant, property or equipment constituting capital
assets;
(xi) make any change in lines of business or any
material changes in prices, marketing plans or procedures;
(xii) make any changes to current levels of inventory,
receivables or payables, except as may occur in the
ordinary course of business consistent with past practice;
(xiii) grant any stock-related, performance or similar
awards or bonuses;
(xiv) forgive any loans to employees, officers or
directors or any of their respective affiliates or
associates;
(xv) make any deposits or contributions of cash or
other property to, or take any other action to fund or in
any other way secure the payment of compensation or
benefits under, any Company benefit plan;
(xvi) enter into, amend, extend or waive any rights
under any collective bargaining or other labor agreement;
(xvii) commence, settle or agree to settle any
litigation, suit, action, claim, proceeding or
investigation;
(xviii) pay, discharge or satisfy or agree to pay,
discharge or satisfy any claim, liability or obligation
(absolute accrued, asserted or unasserted, contingent or
otherwise) other than (A) the payment, discharge or
satisfaction of liabilities reflected or reserved against
in full in the financial statements as at June 30, 1998 or
incurred in the ordinary course of business subsequent to
June 30, 1998 or (B) the Company's Transaction Costs, which
for these purposes shall mean all out-of-pocket costs
reasonably incurred by the Company or any of its
subsidiaries on or after July 1, 1998 in connection with
the potential and actual sale of the Company, including
without limitation (1) the fees and expenses of McDonald &
Co., (2) the fees and expenses of Goelzer & Co., (3) legal
fees and expenses, (4) expenses for environmental reports,
(5) expenses for title reports, (6) expenses for proxy
solicitation and fees and expenses of the Exchange Agent,
and (7) filing fees in connection with compliance with
securities and antitrust laws; but the term Company's
Transaction Costs shall not include (I) any amounts payable
or paid to senior managers of the Company under the Senior
Management Agreements by virtue of the consummation of the
Merger (Parent having agreed separately to cause the
Company after the Effective Time to pay such amounts in
addition to all other consideration for the Merger), or
(II) any expenses incurred by Parent or Purchaser with
respect to the Offer;
(xix) enter into, modify, amend or terminate any
contract material to the business of the Company or any of
its subsidiaries which it may enter, amend or terminate
without violating clause (ix) above, or waive any rights
under any such contract, unless in each instance the
Company first obtains the consent of Parent, which consent
shall not be unreasonably withheld;
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(xx) enter into or extend or renew any contract
(including without limitation any insurance policy), which
contract, extension or renewal has a term or is to be
performed over a period of more than 60 days (and before
renewing any insurance policy, the Company shall reasonably
consult with Parent); or
(xxi) enter into any contract, agreement, commitment
or arrangement to do or engage in any of the foregoing.
The Company has agreed that it will confer on a regular and
frequent basis with Parent with respect to the Company's
businesses and operations and other matters relevant to the
Merger, and shall promptly advise Parent, in writing, of any
change or event, including, without limitation, any complaint,
investigation or hearing by any governmental or regulatory
authority (or communication indicating the same may be
contemplated) or the institution or threat of litigation, having,
or which, insofar as can be reasonably foreseen, could have, a
material adverse effect on the Company or on the ability of the
Company to consummate the transactions contemplated by the Offer
and the Merger Agreement.
No Solicitation.
The Company has agreed that it will not, and it will not
authorize or permit its subsidiaries or any of its or their
officers, directors, employees, investment bankers, financial
advisors, attorneys, accountants or other agents or
representatives (each, a "Representative") to directly or
indirectly, solicit, initiate or participate in any negotiations
regarding, furnish any confidential information in connection
with, endorse or otherwise cooperate with, or assist, participate
in or facilitate (collectively, "Solicitation Activities") the
making of any proposal or offer for, or which may reasonably be
expected to lead to, a Potential Transaction (as defined below),
by any person, corporation, partnership or other entity or group,
including a current holder of Shares or a person acting on behalf
of or who has been in contact with such a holder (a "Potential
Acquiror"); provided, however, that to the extent the Board of
Directors of the Company believes, on the basis of a written
opinion furnished by independent legal counsel, that the failure
to take any such actions would constitute a breach of applicable
fiduciary duties of such Board of Directors, then the Company and
its Representatives may participate in Solicitation Activities
but only to the extent necessary to comply with such duties;
provided further, however, that the Company will promptly inform
Parent, in writing, of the material terms and conditions of any
proposal or offer for, or which may reasonably be expected to
lead to, a Potential Transaction that it receives and the
identity of the Potential Acquiror and the Company shall keep
Parent fully apprised of all developments regarding such
Potential Transaction. Such full apprising of all developments
shall include providing Parent with copies of all correspondence
from or to the Company and the Potential Acquiror, including all
attachments and enclosures. (As used in the Merger Agreement,
"Potential Transaction" means any potential merger, consolidation
or other business combination involving the Company, or any
acquisition in any manner of all or a substantial portion of the
equity of, or all or a substantial portion of the assets of the
Company whether for cash, securities or any other consideration
or combination thereof other than pursuant to the transactions
contemplated by the Merger Agreement.)
The Company has also agreed, as of the date and time of the
Merger Agreement that the Company and its Representatives will
immediately cease and cause to be terminated any existing
activities, discussions or negotiations with any parties other
than Parent and Purchaser conducted theretofore with respect to
any Potential Transaction.
Filing of the Proxy Statement. The Company has agreed that
it will prepare and file with the Commission the Proxy Statement
at the earliest practicable date after the Offer has expired or
terminated (unless 90% or more of Shares are acquired by
Purchaser pursuant to the Offer or the Shares cease to be
registered under the Exchange Act in accordance with applicable
law); and shall use all reasonable efforts to have the Proxy
Statement cleared by the Commission. Parent, Purchaser and the
Company have agreed to cooperate with each other in the
preparation of the Proxy Statement, and the Company has agreed to
promptly notify Parent of the receipt of any comments of the
Commission with respect to the Proxy Statement and of any
requests by the Commission for any amendment or supplement
thereto or for additional information, and to promptly provide to
Parent copies of all correspondence between the Company or any
representative of the Company and the Commission with respect to
the Proxy Statement. The Company has agreed to give Parent and
its counsel the opportunity to review the Proxy Statement and all
responses to requests for additional information by and replies
to comments of the Commission before their being filed with, or
sent to, the Commission. If the Proxy Statement is required to be
filed with the Commission,
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<PAGE>
each of the Company, Parent and Purchaser has agreed to use all
reasonable efforts, after consultation with the other parties
thereto, to respond promptly to all such comments of and requests
by the Commission and to cause the Proxy Statement to be mailed
to the holders of Shares entitled to vote at the Stockholder
Meeting at the earliest practicable time.
Stockholder Approval of the Merger. To the extent required
by applicable law, the Company has agreed to, through its Board
of Directors, duly call, give notice of, convene and hold the
Stockholder Meeting for the purpose of voting on the adoption of
the Merger Agreement (the "Stockholders' Approval") as soon as
reasonably practicable after consummation of the Offer but in any
event prior to the 90th day after the date of the Merger
Agreement (subject to certain unavoidable delays outside the
control of the parties). Except to the extent legally required
for the discharge of its fiduciary duties as reflected in a
written opinion of independent legal counsel, the Company has
agreed to include in the Proxy Statement the recommendation of
the Board of Directors of the Company that the stockholders of
the Company adopt the Merger Agreement and approve the Merger,
and the Company has agreed to use all reasonable efforts to
obtain such adoption and approval, including utilizing a proxy
solicitation firm that is reasonably acceptable to Parent. At
such meeting, Parent shall, and has agreed to and has agreed to
cause its Subsidiaries to, vote all shares of the Shares, if any,
then owned by Parent or any such Subsidiary in favor of the
adoption of the Merger Agreement.
In the event that the approval and adoption of the Merger
Agreement and the Merger at the Stockholder Meeting or any
adjournment thereof receives the affirmative vote of less than
66-2/3% of all shares entitled to vote for such approval, then
Parent may in its sole discretion require the Company to, and the
Company has agreed to be obligated to, through its Board of
Directors, duly call, give notice of, convene and hold a second
Stockholder Meeting for the purpose of voting on the adoption of
the Merger Agreement. Such second Stockholder Meeting shall be
held as soon as reasonably practicable after the date of the
notice from Parent to the Company in which Parent notifies the
Company that Parent desires the Company to call a second
Stockholder Meeting.
If Parent directly or indirectly acquires at least 90
percent of the outstanding Shares, each of Parent, Purchaser and
the Company have agreed, if Purchaser so requests, to take all
necessary and appropriate action as Parent may reasonably request
to cause the Merger to become effective as promptly as
practicable after the consummation of the Offer without a meeting
of holders of the Shares in accordance with the applicable
provisions of the NMBCA.
Consents and Approvals. Subject to certain conditions, each
of the Company and Parent have agreed to proceed diligently and
in good faith and will use all commercially reasonable efforts to
do, or cause to be done, all things necessary, proper or
advisable to, as promptly as practicable, obtain all consents,
approvals or actions of, make all filings with and give all
notices to governmental or regulatory authorities or any other
public or private third parties that may be required of Parent,
the Company or any of their subsidiaries in order to consummate
the Offer and the Merger. In addition to and not in limitation of
the foregoing, (i) each of the parties have agreed to (x) take
promptly all actions necessary to make the filings required of
Parent and the Company or their affiliates under the HSR Act, (y)
comply at the earliest practicable date with any request for
additional information received by such party or its affiliates
from the Federal Trade Commission (the "FTC") or the Antitrust
Division of the Department of Justice (the "Antitrust Division")
pursuant to the HSR Act, and (z) cooperate with the other party
in connection with such party's filings under the HSR Act and in
connection with resolving any investigation or other inquiry
concerning the Merger or the other matters contemplated by the
Merger Agreement commenced by either the FTC or the Antitrust
Division or state attorneys general.
Company Employees. Parent has agreed that after the
Effective Time the Company will honor in accordance with their
respective provisions the existing agreements between the Company
and each of Messrs. Bishop, McVay, Holmquist, Krauskopf, Kubly,
Minard, Mitting, McCune and Sturch (collectively, "Senior
Management Agreements"). Further, Parent has agreed to cause
after the Effective Time the Company to pay to each of such
persons the transaction bonus contemplated in each persons
applicable Senior Management Agreement, in the installments and
at the times specified therein, irrespective of whether the
Merger is deemed to have been supported or sponsored by
management or any management group. In addition, Parent has
agreed that it will cause the Company after the Effective Time to
honor all existing union contracts and all other existing
agreements between the Company and its employees that have been
disclosed by the Company to Parent prior to the date of the
Merger Agreement.
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<PAGE>
Expenses. Subject to the applicability of the Termination
Fee and remedies in respect of a breach of the Merger Agreement,
if the Merger is not consummated, all costs and expenses incurred
in connection with the Merger Agreement and the transactions
contemplated by the Merger Agreement will be paid by the party
incurring such cost or expense. However, if the Merger is
consummated, the Company's Transaction Costs (as defined below)
will be paid by the Company either before or after the Effective
Time, or by Parent, without reduction of the Offer Price or
Merger Consideration payable to holders of Shares pursuant to the
terms of the Offer and the Merger Agreement. As used herein, the
"Company's Transaction Costs" means all out-of-pocket costs
reasonably incurred by the Company or any of its subsidiaries on
or after July 1, 1998 in connection with the potential and actual
sale of the Company, including without limitation (i) the fees
and expenses of McDonald & Co., (ii) the fees and expenses of
Goelzer & Co., (iii) legal fees and expenses, (iv) expenses for
environmental reports, (v) expenses for title reports, (vi)
expenses for proxy solicitation and fees and expenses of the
Exchange Agent, and (viii) filing fees in connection with
compliance with securities and antitrust laws. However, the
Company's Transaction Costs do not include (a) any amounts
payable or paid to senior managers of the Company under the
Senior Management Agreements by virtue of the consummation of the
Merger (Parent having agreed, as described above, to cause the
Company after the Effective Time to pay such amounts in addition
to all other consideration for the Merger), or (b) any expenses
incurred by Parent or Purchaser with respect to the Offer.
Brokers or Finders. Each of Parent and the Company has
represented to the other, as to itself and its affiliates, that
no agent, broker, investment banker, financial advisor or other
firm or person is or will be entitled to any broker's or finder's
fee or any other commission or similar fee in connection with any
of the transactions contemplated by the Offer or the Merger
Agreement, except, in the case of the Company, for McDonald & Co.
and Goelzer & Co.
Directors' and Officers' Indemnification.
(a) Until the fourth anniversary of the Effective Time (and
until resolution of any claims asserted prior to such fourth
anniversary), Parent has agreed to cause the Company after the
Effective Time to indemnify, defend and hold harmless, to the
extent allowed by law and to the extent currently provided in the
By-laws and Articles of Incorporation of the Company, each person
who is as of the date hereof, or has been at any time prior to
the date hereof, a director or officer of the Company or any of
its subsidiaries (the "Indemnified Parties") against (subject to
certain restrictions specified in the Merger Agreement) (i) all
losses, claims, damages, costs, expenses, liabilities or
judgments or amounts that are paid in settlement of or in
connection with any claim, action, suit, proceeding or
investigation based in whole or in part on or arising in whole or
in part out of the fact that such person is or was a director or
officer of the Company or any subsidiary of the Company, whether
pertaining to any matter existing or occurring at or prior to the
Effective Time and whether asserted or claimed prior to, or at or
after, the Effective Time ("Indemnified Liabilities") and (ii)
all Indemnified Liabilities based in whole or in part on, or
arising in whole or in part out of, or pertaining to the Merger
Agreement or the transactions contemplated thereby, in each case
to the full extent the Company would have been permitted under
New Mexico law to indemnify such person (and subject to the
foregoing, the Company after the Effective Time will, in the
event the Company determines in its reasonable discretion that
such person would be entitled to indemnification hereunder, pay
expenses in advance of the final disposition of any such action
or proceeding to each Indemnified Party; provided, however, that
the person to whom the expenses are advanced must provide an
undertaking (without delivering a bond or other security) to
repay such advance if it is ultimately determined that such
person is not entitled to indemnification as provided in Section
53-11-4.1 of the NMBCA). Without limiting the foregoing, in the
event any such claim, action, suit, proceeding or investigation
is brought against any Indemnified Parties (whether arising
before or after the Effective Time), (i) any counsel retained by
the Indemnified Parties for any period after the Effective Time
shall be reasonably satisfactory to the Company; (ii) after the
Effective Time, the Company will pay all reasonable fees and
expenses of such counsel for the Indemnified Parties promptly as
statements therefor are received as theretofore provided; and
(iii) after the Effective Time, the Company will use all
reasonable efforts to assist in the vigorous defense of such
matter, provided that the Company will not be liable for any
settlement of any claim effected without its written consent,
which consent, however, shall not be unreasonably withheld. Any
Indemnified Party wishing to claim indemnification under the
terms of the Merger Agreement, upon learning of any such claim,
action, suit, proceeding or investigation, shall notify the
Company (but the failure so to notify the Company will not
relieve the Company from its obligation to indemnify such person
except to the extent such failure to notify prejudices the
Company), and shall deliver to the Company the undertaking, if
any, required by the NMBCA or the Merger Agreement.
Notwithstanding anything to the contrary contained in the Merger
Agreement, after the
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<PAGE>
Effective Time the Company's obligation to indemnify the officers
and directors prior to the Effective time of the Company as set
forth above shall be limited to cover claims only to the extent
that those claims are not covered under the Company's directors'
and officers' insurance policies in effect as of the date of the
Merger Agreement and the continuation, maintenance or
substitution thereof as required by the Merger Agreement.
Directors' and Officers' Insurance. Parent has agreed to
cause the Company, for a period of four years after the Effective
Time, to maintain in effect the policies of directors' and
officers' liability insurance that were maintained by the Company
prior to the execution of the Merger Agreement (provided that the
Company may substitute therefor other policies of at least the
same coverage and amounts containing terms and conditions which
are no less advantageous) with respect to claims arising from
facts or events which occurred before or at the Effective Time;
provided, however, that the Company is not obligated to make
annual premium payments for such insurance to the extent such
premiums exceed 125% of the premiums paid as of the date of the
Merger Agreement by the Company for such insurance (the
"Company's Current Premium"), and if such premiums for such
insurance would at any time exceed 125% of the Company's Current
Premium, then the Company shall cause to be maintained policies
of insurance which, in the Company's good faith determination,
provide the maximum coverage available at an annual premium equal
to 125% of the Company's Current Premium.
Retention of the Company Name. Parent has agreed that until
the 10th anniversary of the Effective Time of the Merger, Parent
will cause the name of the Company to continue to be "Bryan Steam
Corporation", unless, due to a change in circumstances after the
Effective Time, such continuation will be, in the opinion of the
Board of Directors of the Company at that time, materially
adverse to Parent or the Company.
Takeover Laws. The Company has agreed to, upon the request
of Parent, take all reasonable steps to exclude the applicability
of, or to assist in any challenge by Parent or Purchaser of the
validity or applicability to the Merger of, any Takeover Laws. As
used herein, "Takeover Laws" means any "moratorium", "control
share acquisition", "business combination", "fair price" or other
form of antitakeover laws and regulations of any jurisdiction
that may purport to be applicable to the Merger Agreement or the
Merger.
Termination Fee; Expenses.
(a) The Company has agreed that in the event that the
Merger Agreement is terminated as a result of the occurrence of
any Trigger Event (as defined below), then the Company will pay
to Parent a fee equal to 1.5% of the purchase price as defined in
the Merger Agreement plus all Parent Reimbursable Expenses (as
defined below); provided, however, that if such termination is
solely attributable to events described in clause (iii) or (iv)
of the definition of Trigger Event, then the Company will pay to
Parent all Parent Reimbursable Expenses (but not the 1.5% fee).
Amounts due hereunder shall be payable in immediately available
funds at the time of such termination.
(b) As used herein, "Trigger Event" means the occurrence of
any of the following:
(i) the Board of Directors of the Company (or any
committee thereof) shall approve, recommend, authorize, propose
or facilitate any potential Acquisition Transaction (as defined
below) other than the Offer and the Merger pursuant to the Merger
Agreement, or such Board (or any such committee) shall engage in
discussions or negotiations with a potential counterparty
concerning any such potential Acquisition Transaction, or such
Board (or any such committee) shall publicly announce its
intention to do any of the foregoing;
(ii) the Board of Directors of the Company (or any
committee thereof) shall fail to recommend the Offer and the
Merger to stockholders of the Company in the Schedule 14D-9 or
proxy statement required by the Merger Agreement or within two
business days following Parent's request from time to time that
the Company so confirm its recommendation of the Offer and the
Merger, or such Board (or any such committee) shall withdraw,
modify or amend in any manner adverse to Parent the
authorization, approval or recommendation given by such Board (or
such committee) to the Offer and the Merger, or shall publicly
announce that it does not favor the Offer or the Merger;
(iii) the stockholders of the Company holding at least
66-2/3% of the outstanding Shares shall fail to approve the
Merger in accordance with applicable law at the Stockholder
Meeting, or if the Stockholder Meeting shall not be held on or
prior to December 31, 1998; or
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<PAGE>
(iv) any person, entity or "group" (as that term is
used in Section 13(d)(e) of the Exchange Act), other than those
stockholders who have executed and delivered the Stockholders'
Agreement as described in the recitals to the Merger Agreement,
becomes the beneficial owner (as defined in Rule 13d-3
promulgated under the Exchange Act) of 15% or more of the
outstanding Shares.
(c) As used herein, "Acquisition Transaction" means any
tender offer or exchange offer, any merger, consolidation,
liquidation, dissolution, recapitalization, reorganization or
other business combination, any acquisition, sale or other
disposition of a material amount of assets or securities or any
other similar transaction involving the Company, its securities
or any of its subsidiaries or divisions.
(d) As used herein, "Parent Reimbursable Expenses" means
all out-of-pocket costs (including without limitation reasonable
legal and accounting costs) theretofore and hereafter incurred by
Parent in connection with the transactions contemplated by the
Merger Agreement including, without limitation, costs and
expenses incurred in connection with (i) Parent's due diligence
investigations concerning the Company and its subsidiaries, (ii)
Parent's preparation of preliminary and final proposals relating
to the acquisition of the Company, (iii) Parent's negotiation of
the Merger Agreement, (iv) Parent's assistance in the preparation
of the proxy statement relating to the Merger, (v) fees and
expenses of the Exchange Agent, and (vi) fees and expenses
reasonably incurred so as to facilitate and promote consummation
of the Merger.
Conditions to the Merger. Pursuant to the Merger Agreement,
the respective obligations of each party to effect the Merger are
subject to the fulfillment, or waiver where permissible, at or
prior to the proposed Effective Time, of each of the following
conditions: (a) the Merger Agreement and the transactions
contemplated thereby shall have been approved by the Company's
stockholders in the manner and to the extent required by
applicable law and the Articles of Incorporation and By-laws of
the Company; (b) any waiting period (and any extension thereof)
applicable to the consummation of the Merger under the HSR Act
shall have expired or been terminated; (c) no action or
proceeding before a court of competent jurisdiction or other
competent governmental body by any governmental or regulatory
authority shall have been instituted or threatened to make
illegal or otherwise restrain or prohibit (whether temporarily,
preliminary or permanently) the Merger or the other transactions
contemplated by the Merger Agreement or to obtain an amount of
damages or other material relief in connection with the execution
of the Merger Agreement or the consummation of the Merger or
other transactions contemplated by the Merger Agreement; and no
governmental agency shall have given notice to any party thereto
to the effect that consummation of the Merger or the other
transactions contemplated by the Merger Agreement would
constitute a violation of any law or that it intends to commence
proceedings to restrain consummation of the Merger (each party
thereto, however, has agreed to use reasonable efforts promptly
to have such prohibition or notice lifted); and (d) each of
Purchaser and the Company shall have received from the other
appropriately certified copies of all resolutions adopted by
their respective Boards of Directors and stockholders in
connection with the Merger Agreement and the transactions
contemplated thereby.
Conditions to Obligation of Parent and Purchaser to Effect
the Merger. The obligation of Parent and Purchaser to effect the
Merger is further subject to the fulfillment at or prior to the
proposed Effective Time, of each of the following additional
conditions (all or any of which may be waived in whole or in part
by Parent and Purchaser in their sole discretion): (a) the
Company shall have performed and complied with, in all material
respects, each agreement, covenant and obligation required by the
Merger Agreement to be so performed or complied with by the
Company at or prior to the Closing, and the Company shall have
delivered to Parent a certificate, dated the Closing Date and
executed on behalf of the Company by its President, to such
effect; (b) all proceedings to be taken on the part of the
Company in connection with the transactions contemplated by the
Merger Agreement and all documents incident thereto shall be
reasonably satisfactory in form and substance to Parent, and
Parent shall have received copies of all such documents and other
evidences as Parent may reasonably request in order to establish
the consummation of such transactions and the taking of all
proceedings in connection therewith, and such documents shall
include, but shall not be limited to (i) certain certificates as
required by certain provisions of the Merger Agreement, (ii) a
certificate of existence or good standing regarding each of the
Company and its subsidiaries, certified in the case of the
Company by the New Mexico Corporation Commission and certified in
the case of the Company's Subsidiaries by the appropriate office of
the jurisdiction of its respective incorporation, each dated
within ten (10) business days of the proposed Effective Time,
(iii) an incumbency certificate certifying the identity of the
officers of the Company, and (iv) the resignations, effective the
Closing Date, of such directors and officers of the Company and
its subsidiaries as Parent shall specify consistent with the
Merger Agreement;
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<PAGE>
(c) Parent shall have received a complete list of the signatories
of each account or safe deposit box of the Company and its
subsidiaries; (d) the Company shall not have received written
objections to the Merger from holders who in the aggregate hold
more than 10% of the outstanding Shares, and the Company shall
not have knowledge that holders of 10% or more of the outstanding
Shares intend to file with the Company written objections to the
Merger; (e) the Company shall have delivered to Parent a final
accounting of the Company's Transaction Costs, in form reasonably
satisfactory to Parent, including copies of applicable final
invoices; (f) other than specific filings provided for by the
Merger Agreement, all consents, approvals and actions of filings
with and notices to any governmental or regulatory authority or
any other public or private third party required of the Company
or any of its subsidiaries to consummate the Merger and the other
transactions contemplated by the Merger Agreement, the failure of
which to be obtained or taken could, individually or in the
aggregate, be reasonably expected to have a material adverse
effect on the Company and its subsidiaries or on the ability of
the Company to consummate the transactions contemplated by the
Merger Agreement shall have been obtained, all in form and
substance reasonably satisfactory to Parent and no such consent,
approval or action shall contain any term or condition which
could be reasonably expected to result in a material diminution
of the benefits of the Merger to Parent.
Conditions to Obligation of the Company to Effect the
Merger. The obligation of the Company to effect the Merger is
further subject to the fulfillment, at or prior to the proposed
Effective Time, of each of the following additional conditions
(all or any of which may be waived in whole or in part by the
Company in its sole discretion): (a) each of the representations
and warranties made by Parent and Purchaser in the Merger
Agreement shall be true and correct in all material respects as
of the proposed Effective Time as though made on and as of such
time or, in the case of representations and warranties made as of
a specified date earlier than such time, on and as of such
earlier date, and Parent and Purchaser shall each have delivered
to the Company a certificate, dated the proposed Effective Time
and executed on behalf of Parent by its President and on behalf
of Purchaser by its President, to such effect; (b) Parent and
Purchaser shall have performed and complied with, in all material
respects, each agreement, covenant and obligation required by the
Merger Agreement to be so performed or complied with by Parent or
Purchaser at or prior to the Closing, and Parent and Purchaser
shall each have delivered to the Company a certificate, dated the
Closing Date and executed on behalf of Parent by its President
and on behalf of Purchaser by its President, to such effect; (c)
the Company shall have received a written opinion, dated as of
the Closing Date, from Krieg, Devault, Alexander & Capehart,
Indiana counsel to Parent and Purchaser, from Cleary, Gottlieb,
Steen & Hamilton and/or from Parent's New Mexico counsel, as
appropriate, in form and substance reasonably satisfactory to the
Company, as to certain appropriate matters agreed upon by legal
counsel of Parent and Purchaser and of the Company; (d) all
proceedings to be taken on the part of Parent and Purchaser in
connection with the transactions contemplated by the Merger
Agreement and all documents incident thereto shall be reasonably
satisfactory in form and substance to the Company, and the
Company shall have received copies of all such documents and
other evidences as the Company may reasonably request in order to
establish the consummation of such transactions and the taking of
all proceedings in connection therewith, and such documents shall
include, but shall not be limited to: (i) certain certificates as
required by certain provisions of the Merger Agreement, (ii)
certificates of existence or good standing regarding each of
Parent and Purchaser, certified by the New York Secretary of
State and the New Mexico State Corporation Commission,
respectively, dated within ten (10) business days of the Closing
Date, and (iii) incumbency certificates certifying the identity
of the officers of Parent and Purchaser, respectively; and (e)
the Exchange Fund shall have been funded with the full amount of
the Merger Consideration for all outstanding shares of the
Shares.
For a description of the conditions to the Offer, see
Section 14.
Termination. The Merger Agreement may be terminated, and
the transactions contemplated thereby may be abandoned, at any
time prior to the Effective Time, whether prior to or after
Stockholders' Approval: (a) by mutual written agreement of the
parties thereto duly authorized by action taken by or on behalf
of their respective Boards of Directors; (b) by either the
Company or Parent upon notification to the non-terminating party
by the terminating party: (1) if the Merger shall not have been
consummated on or prior to January 31, 1999 and such failure to
consummate the Merger is not caused by a breach of the Merger
Agreement by the terminating party; provided, however, such date
may be extended indefinitely by the mutual written agreement of
the parties, (2) if Stockholders' Approval shall not be obtained
by January 31, 1999, (3) if any governmental or regulatory
authority, the taking of action by which is a condition to the
obligations of either the Company or Parent to consummate the
transactions contemplated thereby, shall have determined not to
take such action and all appeals of such determination shall have
been taken and have been unsuccessful, or (4) if any court of
competent jurisdiction or
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<PAGE>
other competent governmental or regulatory authority shall have
issued an order making illegal or otherwise restricting,
preventing or prohibiting the Merger and such order shall have
become final and nonappealable; (c) by the Company, if (1)
Purchaser fails to commence the Offer as provided in the Merger
Agreement or fails to purchase validly tendered Shares in
violation of the terms of the Offer or the Merger Agreement; (2)
there has been a breach by Parent or Purchaser of any
representation or warranty contained in the Merger Agreement, or
(3) there has been a material breach of any of the covenants or
agreements set forth in the Merger Agreement on the part of
Parent or Purchaser, which breach is not curable or, if curable,
is not cured within ten (10) days after written notice of such
breach is given by the Company to Parent or Purchaser.; (d) by
Parent, if (1) the Offer is terminated or withdrawn on account of
the failure to be fulfilled of a condition specified in Annex A
to the Merger Agreement (as specified in Section 14 of this
Offer), (2) there has been a breach by the Company of any
representation or warranty contained in the Merger Agreement or
(3) there has been a material breach of any of the covenants or
agreements set forth in the Merger Agreement on the part of the
Company, which breach is not curable or, if curable, is not cured
within ten (10) days after written notice of such breach is given
by Parent to the Company; or (e) by Parent if a Trigger Event
occurs.
Amendment. The Merger Agreement may be amended,
supplemented or modified by the parties thereto at any time prior
to the Effective Time, whether prior to or after adoption of the
Merger Agreement at the Stockholder Meeting, but after such
adoption only to the extent permitted by applicable law. No such
amendment, supplement or modification shall be effective unless
set forth in a written instrument duly executed by or on behalf
of each party thereto.
Governing Law. The Merger Agreement is governed by and
construed in accordance with the laws of the State of Indiana
applicable to a contract executed and performed in such State
without giving effect to the conflicts of laws principles
thereof, except to the extent that the NMBCA, the Securities Act
and the Exchange Act shall apply to the transactions contemplated
therein.
Enforcement of Agreement; Injunctive Relief. Parent,
Purchaser and the Company have irrevocably and unconditionally
submitted to the exclusive jurisdiction and venue of the United
States District Court for the Southern District of Indiana,
Indianapolis Division for federal jurisdiction (unless such court
has no jurisdiction, in which case Parent, Purchaser and the
Company submitted to the exclusive jurisdiction of the courts of
the State of Indiana located in Marion County) for any actions,
suits or proceedings arising out of or relating to the Merger
Agreement and the transactions contemplated thereby. Parent,
Purchaser and the Company have also waived, to the fullest extent
permitted by law, any rights they may have to a jury trial on any
matter related in any way to the Merger Agreement or the
transactions contemplated thereby. In addition, each of the
Company on the one hand and Parent and Purchaser on the other
hand have recognized and acknowledged that a breach by it of any
covenants or agreements contained in the Merger Agreement will
cause the other party to sustain damages for which it would not
have an adequate remedy at law for money damages, and therefore
each of the parties thereto has agreed that in the event of any
such breach, if the aggrieved party so desires, the aggrieved
party shall be entitled to the remedy of specific performance,
injunctive and other equitable relief (without the requirement or
need for the posting of any bond) in addition to any other remedy
to which the aggrieved party may be entitled, at law or in
equity.
Joint and Several Obligations. The obligations of Parent
and Purchaser under the Merger Agreement are joint and several.
Timing. The exact timing and details of the Merger will
depend upon legal requirements and a variety of other factors,
including the number of Shares acquired by Purchaser pursuant to
the Offer. Although Parent has agreed to cause the Merger to be
consummated on the terms and subject to the conditions set forth
above, there can be no assurance as to the timing of the Merger.
Stockholders' Agreement
The following is a summary of the material terms of the
Stockholders' Agreement. This summary is not a complete
description of the terms and conditions thereof and is qualified
in its entirety by reference to the full text thereof 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 Stockholders' Agreement may be examined, and copies thereof
may be
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obtained, as set forth in Section 8 (except that such
Agreement will not be available at the regional offices of the
Commission).
The stockholders who have signed the Stockholders'
Agreement together beneficially own 106,315 Shares, constituting
approximately 55.6% of the outstanding Shares.
Voting of Shares. In order to induce Parent to execute and
deliver the Merger Agreement each Proxy Grantor has agreed to
tender such stockholder's Shares and has irrevocably appointed
Parent as the exclusive attorney-in-fact and proxy of such
stockholder, with full power of substitution. Parent, as proxy of
such holder, has been granted the power:
I. to attend any and every meeting (whether annual or special
or both) of the stockholders of the Company, including any
adjournment or postponement thereof, on behalf of such
stockholder, and at each such meeting, with respect to all
shares of common stock of the Company owned by such
stockholder on the date of execution and delivery of the
Stockholders' Agreement or acquired thereafter that are
entitled to vote at each such meeting or over which such
stockholder has voting power (and any and all other shares
of common or preferred stock of the Company or other
securities issued on or after such date in respect of any
such shares):
A. to vote in favor of the Merger (as such term is
defined in the Merger Agreement) and to vote in favor
of the adjournment of any meeting, which Parent
believes may facilitate the obtaining the approval of
the Merger; and otherwise to act with respect to such
shares as said attorney-in-fact and proxy (or his
substitute) shall deem necessary or appropriate to
cause the approval of the Merger by the necessary
two-thirds majority required under applicable law;
B. to vote and otherwise act with respect to such shares
in such a manner as said attorney-in-fact and proxy
(or his substitute) shall deem proper, with respect to
(x) proposals or offers (other than the Merger)
relating to (1) any proposed sale, lease or other
disposition of all or a substantial amount of the
assets of the Company or any of its subsidiaries, (2)
any proposed merger, consolidation or other
combination of the Company or any of its subsidiaries
with any other entity, (3) any sale, issuance,
disposition or granting of rights in respect of the
shares of the Company or of any subsidiary of the
Company or (4) any other proposed action of the
Company or any of its subsidiaries requiring
stockholder approval that would conflict with or
violate the Company's representations, covenants or
obligations under the Merger Agreement, adversely
affect the Company's ability to consummate the Merger
or the other transactions contemplated by the Merger
Agreement or otherwise impede, interfere with or
discourage the Merger (each of the actions described
in (1) - (4) above, an "Acquisition Proposal"), and
(y) any procedural matters presented at any such
meeting at which any action is scheduled to be taken
with respect to the Merger or any Acquisition
Proposal;
II. if no meeting of stockholders is scheduled in accordance
with the Merger Agreement or if any such meeting is
canceled, postponed or adjourned other than with Parent's
approval, to call a special stockholders meeting of the
Company for the purpose of (i) approving the Merger or any
action with respect thereto, or (ii) taking action with
respect to any Acquisition Proposal; and
III. to waive, for the duration of this Stockholders' Agreement,
any and all rights such stockholder may have to exercise
any rights as dissenting stockholder under Sections 53-15-3
and 53-15-4 of the NMBCA, subject to the right to receive
the consideration as specifically provided in the Merger
Agreement.
Restrictions on Transfer. Each Proxy Grantor has agreed (a)
not to deposit any of such stockholder's shares of common stock
of the Company into a voting trust or enter into a voting
agreement with respect to such shares; (b) not to sell, transfer
or otherwise dispose of or pledge or otherwise encumber, any
shares of common stock of the Company, or options or warrants to
purchase such shares, unless the purchaser or transferee of such
shares or rights agrees in writing (a copy of which shall be
delivered by such stockholder to Parent and Purchaser) prior to
such sale, transfer or disposition to be bound by and subject to
the provisions contained in the Stockholders' Agreement; and (c)
not, in his or her capacity as stockholder, to solicit, initiate,
encourage, endorse, support
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<PAGE>
(including, by providing information) or participate in any
discussions regarding, any Acquisition Proposal other than the
Merger.
Irrevocable Proxy. Each Proxy Grantor has affirmed that the
proxy contained in the Stockholders' Agreement is issued in
connection with the Merger Agreement to facilitate the
transactions contemplated thereunder and in consideration of
Parent and Purchaser entering into the Merger Agreement and as
such is coupled with an interest and is irrevocable. The proxy
contained in the Stockholders' Agreement will terminate upon the
earlier to occur of (a) the Effective Time as defined in the
Merger Agreement and (b) the termination of the Merger Agreement
in accordance with its terms. By execution and delivery of the
Stockholders' Agreement, each of the stockholders who are a party
to the Stockholders' Agreement has confirmed that such
stockholder has received a copy of a substantially final form of
the Merger Agreement, and that all other information deemed
necessary by such stockholder concerning the Merger, the Merger
Agreement and the transactions contemplated thereunder or any
other matters considered by such stockholder to be relevant to
the stockholder's decision to execute this Agreement has been
made available to such stockholder. All authority conferred or
agreed to be conferred in the Stockholders' Agreement survives
the death, insolvency, or incapacity of each the stockholders who
is a party to the Stockholders' Agreement and any obligation of
any of such stockholder thereunder is binding upon the heirs,
personal representatives, successors and assigns of such
stockholder. The proxy contained in the Stockholders' Agreement
revokes any and all other proxies theretofore granted by each and
every stockholder who is party to the Stockholders' Agreement.
Each stockholder who is a party to the Stockholders' Agreement
has agreed to not give any subsequent proxy or grant any option
with respect to such shares (and such proxy or option if given
will be deemed not to be effective) that purports to grant
authority within the scope of the authority conferred in the
Stockholders' Agreement.
Covenant to Tender Shares. In order further to induce
Purchaser and Parent to enter into the Merger Agreement, each
Proxy Grantor has further agreed validly to tender (or cause the
record owner of such shares validly to tender), and not to
withdraw, pursuant to and in accordance with the terms of the
Offer, not later than the tenth business day after commencement
of the Offer pursuant to the Merger Agreement and Rule 14d-2
under the Exchange Act, the number of Shares set forth opposite
such stockholder's name on the signature pages to the
Stockholders' Agreement (the "Existing Securities" and, together
with any Shares acquired by such stockholder (whether
beneficially or of record) after the date of the Stockholders'
Agreement and prior to the termination of the Stockholders'
Agreement by means of purchase, dividend, distribution, transfer,
issuance, or exercise of options or other rights to acquire the
Shares (the "Securities")). If any stockholder who signed the
Stockholders' Agreement acquires Securities after the date of the
Stockholders' Agreement, such stockholder has agreed to tender
(or cause the record holder to tender) pursuant to the Offer such
Securities on or before such tenth business day or, if later, on
or before the second business day after such acquisition. Each
stockholder who signed the Stockholders' Agreement acknowledged
and agreed that Purchaser's obligation to accept for payment,
purchase and pay for the Securities in the Offer, including the
Securities beneficially owned by such stockholder, is subject to
the terms and conditions of the Offer.
Specific Performance. Each stockholder who executed the
Stockholders' Agreement acknowledged that money damages would be
both incalculable and an insufficient remedy for any breach of
the Stockholders' Agreement by it, and that any such breach would
cause Parent and Purchaser irreparable harm. Accordingly, each
such stockholder agreed that in the event of any breach or
threatened breach of this Agreement, Parent and Purchaser, in
addition to any other remedies at law or in equity they may have,
is entitled, without the requirement of posting a bond or other
security, to equitable relief, including injunctive relief and
specific performance.
Representations. Each stockholder who executed the
Stockholders' Agreement represented and warranted that, as of the
date of the Stockholders' Agreement, such stockholder (a) owned
personally and directly the number of shares of the Shares set
forth on the signature page of the Stockholders' Agreement, (b)
owned such stock free and clear of all liens, security interests,
encumbrances, options and other adverse interests of every kind
whatsoever, and (c) had the power and right to execute and
deliver the Stockholders' Agreement, and perform such
stockholder's obligations thereunder, without the consent or
agreement of any other person or entity.
Release of Claims. Each of the stockholders who executed
the Stockholders' Agreement irrevocably waived and released any
and all claims such stockholder may have as a holder of Shares
against any employee,
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officer or director of the Company or any of its subsidiaries in
respect of the conduct of such employee, officer or director in
his or her capacity as such prior to consummation of the Merger.
Governing Law. The Stockholders' Agreement is governed by
the laws of the State of Indiana except that the provisions
thereof with respect to the granting of proxies, the exercise of
the rights granted in respect of such proxies and the associated
appointment of attorneys-in-fact is governed by the laws of the
jurisdiction of incorporation of the Company, which is New
Mexico.
Confidentiality Agreement
Pursuant to an agreement dated as of June 18, 1998 (the
"Confidentiality Agreement") between the Company (acting through
its agent, Goelzer & Co.) and Parent, the Company has supplied
Parent with certain non-public, confidential and proprietary
information about the Company. Parent has agreed in the
Confidentiality Agreement among other provisions that it,
together with its, among others, representatives, employees,
agents, advisors, lenders or affiliates will treat confidentially
all such information supplied by the Company and that it will,
until June 18, 2003, use the confidential information solely for
the purpose of evaluating a possible transaction with the
Company, and will keep the confidential information confidential,
except for disclosure as may be required by law.
Appraisal Rights
No appraisal rights are available to holders of Shares in
connection with the Offer. However, if the Merger is consummated,
holders of Shares will have certain rights under Section 53-15-3
of the NMBCA to dissent and demand payment in cash of the fair
value of their Shares. Such rights, if the statutory procedures
are complied with, could lead to a judicial determination of the
fair value required to be paid in cash to such dissenting holders
for their Shares. Any such judicial determination of the fair
value of Shares could be based upon considerations other than or
in addition to the Offer Price and the market value of the
Shares, including asset values and the investment value of the
Shares. The value so determined could be more or less than the
Offer Price and the Merger Consideration.
If any holder of Shares who demands payment of fair value
under Section 53-15-3 of the NMBCA fails to perfect, or
effectively withdraws or loses such stockholder's right to fair
value as provided in the NMBCA, the Shares of such holder will be
converted into the right to receive Merger Consideration in
accordance with the Merger Agreement. A stockholder may withdraw
such stockholder's demand by delivery to Company of a written
withdrawal of such stockholder's demand and acceptance of the
Merger.
Failure to follow the steps required by Sections 53-15-3
and 4 of the NMBCA for perfecting rights to payment of fair value
may result in the loss of such rights.
Plans for the Company
As soon as practicable following the consummation of the
Offer, Purchaser intends to effect the Merger. It is expected
that, initially following the Offer and the Merger, the business
and operations of the Company will, except as set forth in this
Offer to Purchase, be continued by the Company substantially as
they are currently being conducted, and that the Company's
current management, under the direction of the Board of Directors
of the Surviving Corporation, will continue to manage the
Company.
"Going Private" Transactions. The Commission has adopted
Rule 13e-3 under the Exchange Act which is applicable to certain
"going private" transactions and which may under certain
circumstances be applicable to the Merger. However, Rule 13e-3
would be inapplicable if (i) the Shares are deregistered under
the Exchange Act prior to the Merger or other business
combination or (ii) the Merger or other business combination is
consummated within one year after the purchase of the Shares
pursuant to the Offer and the amount paid per Share in the Merger
or other business combination is at least equal to the amount
paid per Share in the Offer. If applicable, Rule 13e-3 requires,
among other things, that certain financial information concerning
the fairness of the proposed transaction and the consideration
offered to minority stockholders in such transaction be filed
with the Commission and disclosed to stockholders prior to the
consummation of the transaction.
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<PAGE>
Except as noted in this Offer to Purchase, Purchaser and
Parent have no present plans or proposals that would result in an
extraordinary corporate transaction, such as a merger,
reorganization, liquidation, or sale or transfer of a material
amount of assets, involving the Company or any of its
subsidiaries, or any material changes in the Company's
capitalization, dividend policy, corporate structure, business or
composition of its management.
13. Dividends and Distributions
Pursuant to the terms of the Merger Agreement, the Company
is prohibited from issuing, selling, pledging or granting any
options, rights to purchase, warrants or shares of capital stock
of the Company or any option in respect thereof and the Company
is further prohibited from declaring or paying any dividends or
distributions other than the dividend of $2.00 per Share declared
on August 26, 1998 and payable on September 15, 1998.
14. Certain Conditions of the Offer
Notwithstanding any other provision of the Offer, the
obligation of Purchaser to accept for payment, purchase or pay
for any Shares tendered prior to the Expiration Date is subject
to the fulfillment, at or prior to the Expiration Date, of the
following conditions (and upon the failure of any such condition
to be fulfilled, unless waived by Purchaser, Purchaser may
terminate the Offer as to any Shares not then accepted for
payment, and Purchaser shall not be required to accept for
payment, purchase or, subject to any applicable rules and
regulations of the Commission, including Rule 14e-1(c) under the
Exchange Act, pay for any Shares):
(a) The number of Shares validly tendered and not
withdrawn shall constitute at least a two-thirds majority
plus one of the outstanding Shares on a fully diluted
basis.
(b) Any waiting period (and any extension thereof)
applicable to the consummation of the Offer under the HSR
Act shall have expired or been terminated.
(c) No action or proceeding before a court of
competent jurisdiction or other competent governmental body
by any governmental or regulatory authority shall have been
instituted or threatened to make illegal or otherwise
restrain or prohibit (whether temporarily, preliminary or
permanently) the Offer or the Merger or the other
transactions contemplated by the Merger Agreement or to
obtain an amount of damages or other material relief in
connection with the execution of the Merger Agreement or
the consummation of the Offer or other transactions
contemplated by the Merger Agreement; and no governmental
agency shall have given notice to any party hereto to the
effect that consummation of the Offer or the Merger or the
other transactions contemplated by the Merger Agreement
would constitute a violation of any law or that it intends
to commence proceedings to restrain consummation of the
Offer or the Merger.
(d) Purchaser shall have received from the Company
appropriately certified copies of all resolutions adopted
by the Company's Board of Directors in connection with the
Offer, the Merger, the Merger Agreement and the
transactions contemplated thereby.
(e) Each of the representations and warranties made by
the Company in the Merger Agreement shall be true and
correct in all respects (subject to limitations as to
materiality as may be contained therein) as though made on
and as of the Expiration Date or, in the case of
representations and warranties made as of a specified date
earlier than the Expiration Date, on and as of such earlier
date, and the Company shall have delivered to Parent a
certificate, dated the Expiration Date and executed on
behalf of the Company by its President to such effect.
(f) The Company shall have performed and complied
with, in all material respects, each agreement, covenant
and obligation required by the Merger Agreement to be so
performed or complied with by the Company at or prior to
the Expiration Date, and the Company shall have delivered
to Parent a certificate, dated the Expiration Date and
executed on behalf of the Company by its President, to such
effect.
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<PAGE>
(g) Parent and Purchaser shall have received a written
opinion, dated as of the Expiration Date, from Barnes &
Thornburg, counsel to the Company, in form and substance
reasonably satisfactory to Parent and Purchaser, as to
certain appropriate matters agreed upon by legal counsel of
Parent and Purchaser and of the Company.
(h) All proceedings to be taken on the part of the
Company on or before the consummation of the Offer in
connection with the transactions contemplated by the Merger
Agreement and all documents incident thereto shall be
reasonably satisfactory in form and substance to Parent,
and Parent shall have received copies of all such documents
and other evidences as Parent may reasonably request in
order to establish the consummation of such transactions
and the taking of all proceedings in connection therewith.
Such documents shall include, but shall not be limited to:
(i) the certificates required by clauses (e) and (f) of
this Section 14; (ii) a certificate of existence or good
standing regarding each of the Company and its
Subsidiaries, certified in the case of the Company by the
New Mexico Corporation Commission and certified in the case
of the Company's subsidiaries by the appropriate office of
the jurisdiction of its respective incorporation, each
dated within ten (10) business days of the Expiration Date;
and (iii) an incumbency certificate certifying the identity
of the officers of the Company.
(i) The Company and each of its Subsidiaries shall
have good, marketable and insurable title to their
respective real properties, subject only to those
encumbrances identified in a schedule to the Merger
Agreement, and the Company shall have obtained and
delivered to Parent reasonable assurances from the relevant
municipalities to the effect that such real properties and
their current operations are in compliance with local
zoning ordinances without constituting non-conforming uses.
(j) The Company shall have delivered to Parent a
current survey of the real property and facilities of the
Company located in Peru, Indiana, which survey (i) shall
have been prepared by a licensed Indiana land surveyor,
(ii) shall fulfill the Minimum Detail Requirements for
ALTA/ACSM Land Title Surveys (1992) for an Urban Survey and
Table A thereof, and (iii) shall have been certified to the
Surviving Corporation, Parent and Parent's title insurance
company in a manner reasonably satisfactory to Parent; and
such survey shall not show encroachments or other matters
which, individually or in the aggregate, materially
adversely affect the value or use of such real property and
facilities.
(k) There shall not have occurred (A) any general
suspension of, or limitation on prices for, trading in the
securities of a general nature on any national securities
exchange that lasts more than 24 hours, (B) the declaration
of any banking moratorium or any suspension of payments in
respect of banks or any limitation (whether or not
mandatory) on the extension of credit by lending
institutions in the United States, (C) the commencement of
a war, armed hostilities or any other international or
national calamity involving the United States or a
substantial terrorist attack or the threat thereof on a
target in United States that leads to the declaration of a
national emergency, (D) a material adverse change in the
United States currency exchange rates or a suspension of,
or limitation on, the markets therefor, or (E) any decline
in the Dow Jones Index below 6448 (which was the value of
such Index on December 31, 1996).
(l) A Trigger Event shall not have occurred.
(m) Other than the filings required in connection with
the Merger, all consents, approvals and actions of, filings
with and notices to any governmental or regulatory
authority or any other public or private third party
required of the Company or any of its subsidiaries to
consummate the Offer, the failure of which to be obtained
or taken could, individually or in the aggregate, be
reasonably expected to have a material adverse effect on
the Company and its subsidiaries or on the ability of
Parent to consummate the purchase of Shares pursuant to the
Offer, shall have been obtained, all in form and substance
reasonably satisfactory to Parent and no such consent,
approval or action shall contain any term or condition
which could be reasonably expected to result in a material
diminution of the benefits of the Offer to Parent.
(n) The Merger Agreement shall not have been
terminated pursuant to its terms and shall not have been
amended pursuant to its terms to provide for its
termination.
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Notwithstanding anything to the contrary herein, Purchaser cannot
and will not assert any of the conditions set forth under this
Section 14 (other than certain regulatory conditions as, and to
the extent, permitted by applicable rules and regulations of the
Commission) at any time after the Expiration Date.
15. Certain Legal Matters
Based on information supplied by the Company, and on the
advice of local counsel in Indiana, Purchaser does not believe
that any Indiana state takeover statutes apply (or purport to
apply) to the Offer or the Merger. Based on advice of local
counsel in New Mexico, Purchaser does not believe that any New
Mexico state takeover statutes apply (or purport to apply) to the
Offer or the Merger. Accordingly, Purchaser has not currently
complied with any state takeover statute or regulation. Purchaser
reserves the right to challenge the applicability or validity of
any state law purportedly applicable to the Offer, the
Stockholders' Agreement or the Merger and nothing in this Offer
or any action taken in connection with the Offer, the
Stockholders' Agreement or the Merger is intended as a waiver of
such right. If it is asserted that any state takeover statute is
applicable to the Offer, the Stockholders' Agreement or the
Merger and an appropriate court does not determine that such
statute is inapplicable or invalid as applied to the Offer, the
Stockholders' Agreement or the Merger, Purchaser may be required
to file certain information with, or to receive approvals from,
the relevant state authorities, and Purchaser might be unable to
accept for payment or pay for Shares tendered pursuant to the
Offer, or be delayed in consummating the Offer or the Merger. In
such case, Purchaser may not be obligated to accept for payment
or pay for any Shares tendered pursuant to the Offer.
Antitrust. Under the provisions of the HSR Act applicable
to the Offer, the purchase of Shares under the Offer may be
consummated following the expiration of a 15-calendar-day waiting
period following the filing by Parent as the "ultimate parent
entity" of Purchaser of a Notification and Report Form with
respect to the Offer, unless Parent receives a request for
additional information or documentary material from the Antitrust
Division of the Department of Justice (the "Antitrust Division")
or the Federal Trade Commission (the "FTC") or unless early
termination of the waiting period is granted. Parent's filing
under the HSR Act will also be made with respect to Purchaser's
acquisition of Shares under the Stockholders' Agreement. Parent
is expected to make its filing with the Antitrust Division and
the FTC on or about September 29, 1998. If, within the initial
15-day waiting period, either the Antitrust Division or the FTC
requests additional information or documentary material from
Parent, the waiting period will 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.
Only one extension of the waiting period pursuant to a request
for additional information is authorized by the HSR Act.
Thereafter, such waiting period may be extended only by court
order or with the consent of Parent. If the acquisition of Shares
is delayed pursuant to a request by the FTC or the Antitrust
Division for additional information or documentary material
pursuant to the HSR Act, the Offer may, at the discretion of
Purchaser, be extended and, in any event, the purchase of or any
payment for Shares will be deferred until ten days following the
date the request is complied with by Parent, unless the waiting
period is sooner terminated by the FTC and the Antitrust
Division. Unless the Offer is extended, any extension of the
waiting period will not give rise to any additional withdrawal
rights. See Section 4. Although the Company is required to file
certain information and documentary material with the FTC and the
Antitrust Division in connection with the Offer, neither the
Company's failure to make such filings nor a request from the FTC
or the Antitrust Division for additional information or
documentary material made to the Company will extend the waiting
period.
In practice, complying with a request for additional
information or documentary material may require a significant
amount of time. In addition, if the Antitrust Division or the FTC
raises substantive issues in connection with a proposed
transaction, the parties frequently engage in negotiations with
the relevant governmental agency concerning possible means of
addressing those issues and may agree to delay consummation of
the transaction while such negotiations continue.
The FTC and the Antitrust Division frequently scrutinize
the legality under the antitrust laws of transactions such as
Parent's proposed acquisition of the Company. At any time before
or after Purchaser's purchase of Shares pursuant to the Offer,
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 purchase of
Shares pursuant to the Offer or the consummation of the Merger or
seeking the divestiture of Shares acquired by Purchaser or the
divestiture of substantial assets of Purchaser or its
subsidiaries, or the Company or its subsidiaries. Private parties
may also bring legal action under the antitrust laws under
certain circumstances. There can be no
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<PAGE>
assurance that a challenge to the Offer on antitrust grounds will
not be made or, if such a challenge is made, of the result
thereof. If any such action by the FTC, the Antitrust Division or
any other person should be threatened or commenced, Purchaser may
extend, terminate or amend the Offer. See Section 14 for certain
conditions of the Offer. Parent and Purchaser believe that
consummation of the Offer would not violate any antitrust laws;
there can be no assurance, however, that a challenge to the Offer
on antitrust grounds will not be made or, if a challenge is made,
what the result will be.
Although the parties to the Merger Agreement are required
to remove or satisfy, if reasonably practicable, any objections
to the validity or legality of the Merger, Parent is not required
to satisfy any legal requirement that it divest or hold separate
any assets or business operations of Parent or the Company.
16. Certain Fees and Expenses
Purchaser has retained MacKenzie Partners, Inc. to act as
the Information Agent and IBJ Schroder Bank & Trust Company to
act as the Depositary in connection with the Offer. The
Information Agent and the Depositary each will receive reasonable
and customary compensation for their 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
U.S. federal securities laws.
Except as set forth above, neither Parent nor Purchaser
will pay any fees or commissions to any broker or dealer or other
person for soliciting tenders of Shares pursuant to the Offer.
Brokers, dealers, commercial banks and trust companies will be
reimbursed by Purchaser for customary mailing and handling
expenses incurred by them in forwarding the offering materials to
their customers.
17. Miscellaneous
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 Purchaser becomes
aware of any valid state statute prohibiting the making of the
Offer or the acceptance of Shares pursuant thereto, Purchaser
will make a good faith effort to comply with such state statute.
If, after such good faith effort, 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 Shares
in such state.
Purchaser and Parent have filed with the Commission the
Schedule 14D-1 (including exhibits) pursuant to Rule 14d-3, under
the Exchange Act, containing certain additional information with
respect to the Offer and may file amendments thereto. The Company
has filed with the Commission the Schedule 14D-9 (including
exhibits) containing the Company's recommendation with respect to
the Offer and other information required to be disseminated to
stockholders of the Company pursuant to Rule 14d-9. Such
Statements and any amendments thereto, including exhibits, may be
examined and copies may be obtained from the principal office of
the Commission in the manner set forth in Section 8 (except that
they will not be available at the regional offices of the
Commission).
No person has been authorized to give any information or
make any representation on behalf of Purchaser not contained in
this Offer to Purchase or in the Letter of Transmittal and, if
given or made, such information or representations must not be
relied upon as having been authorized.
Burnham Acquisition Corporation
September 29, 1998
- 32 -
<PAGE>
ANNEX I
DIRECTORS AND EXECUTIVE OFFICERS OF PURCHASER AND PARENT
A. Directors and Executive Officers of Purchaser
The following table sets forth the name, business address,
present principal occupation or employment and five-year
employment history of position with Purchaser and each director
and executive officer of Purchaser.
Position with Purchaser and Present
Name and Address Principal Occupation or Employment
- --------------------------- -----------------------------------
Ronald L. Griffith Sole Director & Secretary,
P.O. 3205 Burnham Acquisition Corporation
Lancaster, PA 17604 Senior Vice President-Finance &
Secretary-Treasurer, Burnham
Corporation*
Albert Morrison III President, Burnham Acquisition
P.O. Box 3205 Corporation
Lancaster, PA 17604 President & Chief Executive Officer,
Burnham Corporation*
B. Directors and Executive Officers of Parent
The following table sets forth the name, business address,
position with Parent and present principal occupation of each
director, executive officer and controlling person of Parent.
Each individual listed below is a citizen of the United States.
Position with Parent and Present
Name and Address Principal Occupation or Employment*
- --------------------------- ------------------------------------
John B. Dodge Chairman of the Board, Burnham Corporation
P.O. Box 3205 President, JVD Development Co., a real estate
Lancaster, PA 17604 development firm
Albert Morrison, III President & Chief Executive Officer, Burnham
P.O. Box 3205 Corporation
Lancaster, PA 17604
Ronald L. Griffith Senior Vice President-Finance &
P.O. Box 3205 Secretary-Treasurer, Burnham
Lancaster, PA 17604 Corporation
Donald E. Sweigart Senior Vice President, Burnham Corporation
P.O. Box 3205
Lancaster, PA 17604
Donald B. Titus Vice President, Burnham Corporation
P.O. Box 3205
Lancaster, PA 17604
Robert L. Coons Vice President, Burnham Corporation
P.O. Box 3205
Lancaster, PA 17604
Kenneth H. Sturtz Vice President, Burnham Corporation
P.O. Box 3205
Lancaster, PA 17604
- -------------------
* In each case, such occupation or employment has remained unchanged
during the previous five years.
- 33 -
<PAGE>
Robert B. Balfantz Vice President, Burnham Corporation
P.O. Box 3205
Lancaster, PA 17604
Shaun D. McMeans Controller, Burnham Corporation
P.O. Box 3205
Lancaster, PA 17604
Ben W. Drew, Jr. Director, Burnham Corporation
P.O. Box 3205 President, MKS Corp., a U.S.-Russian
Lancaster, PA 17604 economic development firm
Elizabeth B. Freimer Director, Burnham Corporation
P.O. Box 3205 Retired
Lancaster, PA 17604
Elizabeth Hughes Director, Burnham Corporation
P.O. Box 3205 Retired
Lancaster, PA 17604
Thomas C. Kile Director, Burnham Corporation
P.O. Box 3205 President, Centerville Development Corp., a
Lancaster, PA 17604 real estate development firm
Robert C. Simpson Director, Burnham Corporation
P.O. Box 3205
Lancaster, PA 17604
William N. Vitalis Director, Burnham Corporation
P.O. Box 3205 Investor
Lancaster, PA 17604
- 34 -
<PAGE>
The Depositary for the Offer is:
IBJ SCHRODER BANK & TRUST COMPANY
By Mail: By Facsimile: By Hand/Overnight Delivery:
P.O. Box 84 (212) 858-2611 One State Street
Bowling Green Station Confirm Facsimile by New York, NY 10004
New York, NY 10274-0084 Telephone: Attention: Securities
Attention: Reorganization (212) 858-2103 Processing Window, SC-1
Department
Delivery of this instrument to an address other than as set
forth above or transmission of instructions to a facsimile number
other than the ones listed above will not constitute a valid
delivery.
Questions and requests for assistance may be directed to
the Information Agent at the telephone numbers and address below.
Additional copies of this Offer to Purchase, the Letter of
Transmittal and other tender offer material may be obtained from
the Information Agent. You may also contact your broker, dealer,
commercial bank or trust company or other nominee for assistance
concerning the Offer.
The Information Agent for the Offer is:
[LOGO OF MACKENZIE PARTNERS, INC.]
156 Fifth Avenue
New York, New York 10010
(212) 929-5500 (Call Collect)
Call Toll-Free: (800) 322-2885
- 35 -
LETTER OF TRANSMITTAL
To Tender Shares of Common Stock
of
Bryan Steam Corporation
Pursuant to the Offer to Purchase
Dated September 29, 1998
by
Burnham Acquisition Corporation
a wholly-owned subsidiary of
Burnham Corporation
- -----------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE
AT 12:00 MIDNIGHT, NEW YORK CITY TIME,
ON WEDNESDAY, OCTOBER 28, 1998,
UNLESS THE OFFER IS EXTENDED.
- -----------------------------------------------------------------
The Depositary for the Offer is:
IBJ SCHRODER BANK & TRUST COMPANY
By Mail: By Facsimile:
P.O. Box 84 (212) 858-2611
Bowling Green Station Confirm Facsimile by Telephone:
New York, NY 10274-0084 (212) 858-2103
Attention: Reorganization
Department
By Hand/Overnight Delivery:
One State Street
New York, NY 10004
Attention: Securities Processing Window, SC-1
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER
THAN AS SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA
FACSIMILE TRANSMISSION OTHER THAN AS SET FORTH ABOVE WILL NOT
CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS LETTER OF
TRANSMITTAL WHERE INDICATED BELOW AND COMPLETE THE SUBSTITUTE
FORM W-9 PROVIDED BELOW.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL
SHOULD BE READ CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS
COMPLETED.
-----------------------------------------------------------------------
| DESCRIPTION OF SHARES TENDERED |
| |
|-----------------------------------------------------------------------|
| Name(s) and Address(es) | Share(s) Tendered (Attach |
| of Registered Holder(s) | additional schedule, if necessary) |
| (please fill in, | |
| if blank) | |
|-----------------------------------------------------------------------|
| | Certificate | Total Number | Number of |
| | Number(s)* | of Shares | Shares |
| | | Represented | (Tendered** |
| | | by Certi- | |
| | | ficate(s)* | |
| |-------------|--------------|-------------|
| | | | |
| |-------------|--------------|-------------|
| | | | |
| |-------------|--------------|-------------|
| | | | |
| |-------------|--------------|-------------|
| | | | |
| |-------------|--------------|-------------|
| | | | |
| |-------------|--------------|-------------|
| | | | |
| |-------------|--------------|-------------|
| | | | |
| |-------------|--------------|-------------|
| |Total Shares | | |
- -----------------------------------------------------------------------
* Need not be completed by stockholders making delivery of
Shares by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all
Shares evidenced by any certificate delivered to the
Depositary are being tendered. See Instruction 4.
<PAGE>
This Letter of Transmittal is to be completed by
stockholders of Bryan Steam Corporation (the "Company") either if
certificates ("Share Certificates") evidencing Shares (as defined
below) are to be forwarded herewith or if delivery of Shares is
to be made by book-entry transfer to the account of IBJ Schroder
Bank & Trust Company (the "Depositary") at The Depository Trust
Company (the "Book-Entry Transfer Facility") pursuant to the
book-entry transfer procedures described in Section 3 of the
Offer to Purchase (as defined below). DELIVERY OF DOCUMENTS TO
THE BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO
THE DEPOSITARY.
Stockholders whose Share Certificates are not
immediately available or who cannot deliver their Share
Certificates and all other documents required hereby to the
Depositary prior to the Expiration Date (as defined in the Offer
to Purchase) or who cannot complete the procedure for delivery by
book-entry transfer on a timely basis and who wish to tender
their Shares must do so pursuant to the guaranteed delivery
procedure described in Section 3 of the Offer to Purchase. See
Instruction 2.
The Information Agent for the Offer is:
[MACKENZIE PARTNERS, INC. LOGO]
156 Fifth Avenue
New York, New York 10010
(212) 929-5500 (Call Collect)
Call Toll Free: (800) 322-2885
<PAGE>
|_| CHECK HERE IF SHARES ARE BEING DELIVERED BY BOOK-ENTRY
TRANSFER TO THE DEPOSITARY'S ACCOUNT AT THE BOOK-ENTRY
TRANSFER FACILITY AND COMPLETE THE FOLLOWING:
Name of Tendering Institution:_______________________
Account Number:______________________________________
Transaction Code Number:_____________________________
|_| CHECK HERE IF SHARES 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):_____________________
Date of Execution of Notice
of Guaranteed Delivery:______________________________
Name of Institution which
Guaranteed Delivery:_________________________________
<PAGE>
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ THE INSTRUCTIONS SET FORTH IN THIS
LETTER OF TRANSMITTAL CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to Burnham Acquisition
Corporation, a New Mexico corporation ("Purchaser"), the
above-described shares of Common Stock, par value $10.00 per
share (the "Shares"), of Bryan Steam Corporation, a New Mexico
corporation (the "Company"), pursuant to Purchaser's offer to
purchase all outstanding Shares, and all benefits that may inure
to holders thereof, for a purchase price of $152.00 per Share,
net to the seller in cash, without interest thereon, upon the
terms and subject to the conditions set forth in the Offer to
Purchase dated September 29, 1998 (the "Offer to Purchase"),
receipt of which is hereby acknowledged, and in this Letter of
Transmittal (which, as they may be amended from time to time,
together constitute the "Offer"). The undersigned understands
that Purchaser reserves the right to transfer or assign, in whole
at any time or in part from time to time, to one or more of its
affiliates, the right to purchase all or any portion of the
Shares tendered pursuant to the Offer, but any such transfer or
assignment will not relieve Purchaser of its obligations under
the Offer and will in no way prejudice the rights of tendering
stockholders to receive payment for Shares validly tendered and
accepted for payment pursuant to the Offer. Capitalized terms not
defined herein shall have the meanings attributed to them in the
Offer to Purchase.
Subject to, and effective upon, acceptance for payment of,
the Shares tendered herewith, in accordance with the terms of the
Offer (including, if the Offer is extended or amended, the terms
and conditions of any such extension or amendment), the
undersigned hereby sells, assigns and transfers to, or upon the
order of, Purchaser all right, title and interest in and to all
the Shares that are being tendered hereby (and any and all other
Shares or other securities or rights issued or issuable in
respect of such Shares on or after September 29, 1998
(collectively, "Distributions")), and irrevocably appoints the
Depositary the true and lawful agent and attorney-in-fact of the
undersigned with respect to such Shares and all Distributions,
with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest), to
(a) deliver Share Certificates evidencing such Shares and all
Distributions, or transfer ownership of such Shares and all
Distributions on the account books maintained by the Book-Entry
Transfer Facility, together, in either case, with all
accompanying evidence of transfer and authenticity, to or upon
the order of Purchaser, (b) present such Shares and all
Distributions for transfer on the Company's books and (c) receive
all benefits and otherwise exercise all rights (except for the
specific rights granted herein or in the Stockholders' Agreement
(if applicable) to Burnham Corporation) of beneficial ownership
of such Shares and all Distributions, all in accordance with the
terms of the Offer.
By executing this Letter of Transmittal, the undersigned
irrevocably appoints Burnham Corporation as attorney-in-fact and
proxy of the undersigned, each with full power of substitution,
to the full extent of the undersigned's rights with respect to
the Shares tendered by the undersigned and accepted for payment
by Purchaser (and any and all Distributions). Such power of
attorney and proxy shall be considered coupled with an interest
in the tendered Shares (and Distributions). This appointment will
be effective if, when, and only to the extent that, Purchaser
accepts such Shares for payment pursuant to the Offer. Except for
the irrevocable power of attorney granted in the Stockholders'
Agreement (if applicable), upon such acceptance for payment, all
prior powers of attorney and proxies given by the undersigned
with respect to such Shares and Distributions will, without
further action, be revoked, and no subsequent powers of attorney
or proxies may be given (and if given will be deemed not to be
effective). The above named attorney-in-fact and proxy will, with
respect to the Shares and Distributions for which the appointment
is effective, be empowered to exercise all voting and other
rights of the undersigned as such attorney-in-fact and proxy may
deem proper at any annual, special, adjourned or postponed
meeting of the Company's stockholders, by written consent or
otherwise. The undersigned understands that Purchaser reserves
the right to require that, in order for Shares or Distributions
to be deemed validly tendered, immediately upon Purchaser's
acceptance for payment of such Shares, Purchaser must be able to
exercise full voting rights with respect to such Shares and
Distributions.
The undersigned hereby represents and warrants that the
undersigned has full power and authority to tender, sell, assign
and transfer the Shares tendered hereby and all Distributions and
that when the same are accepted for payment by Purchaser,
Purchaser will acquire good, marketable and unencumbered title
thereto and to all Distributions,
<PAGE>
free and clear of all liens, restrictions, charges and
encumbrances, and that none of such Shares and Distributions will
be subject to any adverse claim. The undersigned, upon request,
shall execute and deliver all additional documents deemed by the
Depositary or Purchaser to be necessary or desirable to complete
the sale, assignment and transfer of the Shares tendered hereby
and all Distributions. In addition, the undersigned shall remit
and transfer promptly to the Depositary for the account of
Purchaser all Distributions in respect of the Shares tendered
hereby, accompanied by appropriate documentation of transfer,
and, pending such remittance and transfer or appropriate
assurance thereof, Purchaser shall be entitled to all rights and
privileges as owner of each such Distribution and may withhold
the entire purchase price of the Shares tendered hereby or deduct
from such purchase price, the amount or value of such
Distribution as determined by 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 and trustees in
bankruptcy or other legal representatives of the undersigned.
Except as stated in the Offer to Purchase, this tender is
irrevocable.
The undersigned understands that tenders of Shares pursuant
to any one of the procedures described in Section 3 of the Offer
to Purchase and in the instructions hereto will constitute the
undersigned's acceptance of the terms and conditions of the
Offer. Purchaser's acceptance for payment of Shares tendered
pursuant to the Offer will constitute a binding agreement between
the undersigned and Purchaser upon the terms and subject to the
conditions of the Offer, including, without limitation, the
undersigned's representation and warranty that the undersigned
owns the Shares being tendered. The undersigned recognizes that
under certain circumstances set forth in the Offer to Purchase,
Purchaser may not be required to accept for payment any of the
Shares tendered hereby.
Unless otherwise indicated herein in the box entitled
"Special Payment Instructions," please issue the check for the
purchase price of all Shares purchased, and return all Share
Certificates evidencing Shares not purchased or not tendered, in
the name(s) of the registered holder(s) appearing above under
"Description of Shares Tendered." Similarly, unless otherwise
indicated in the box entitled "Special Delivery Instructions,"
please mail the check for the purchase price of all Shares
purchased and all Share Certificates evidencing Shares not
tendered or not purchased (and accompanying documents, as
appropriate) to the address(es) of the registered holder(s)
appearing above under "Description of Shares Tendered." In the
event that the boxes entitled "Special Payment Instructions" and
"Special Delivery Instructions" are both completed, please issue
the check for the purchase price of all Shares purchased and
return all Share Certificates evidencing Shares not purchased or
not tendered in the name(s) of, and mail such check and Share
Certificates to, the person(s) so indicated. Unless otherwise
indicated herein in the box entitled "Special Payment
Instructions," please credit any Shares tendered hereby and
delivered by book-entry transfer, but which are not purchased,
by crediting the account at the Book-Entry Transfer Facility
designated above. The undersigned recognizes that Purchaser has
no obligation, pursuant to the Special Payment Instructions, to
transfer any Shares from the name of the registered holder(s)
thereof if Purchaser does not accept for payment any of the
Shares tendered hereby.
<PAGE>
|_| CHECK HERE IF ANY OF THE CERTIFICATES REPRESENTING
SHARES THAT YOU OWN HAVE BEEN LOST OR DESTROYED AND SEE
INSTRUCTION 10.
Number of Shares represented by
the lost or destroyed certificates: __________________
- ----------------------------- -------------------------------
SPECIAL PAYMENT INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(See Instructions 1, 5, (See Instructions 1, 5,
6 and 7) 6 and 7)
To be completed ONLY if To be completed ONLY if
the check for the purchase the check for the purchase
price of Shares purchased or price of Shares purchased or
Share Certificates evidencing Share Certificates evidencing
Shares not tendered or not Shares not tendered or not
purchased are to be issued in purchased are to be mailed to
the name of someone other someone other than the under-
than the undersigned or if signed, or to the undersigned
Shares tendered by book-entry at an address other than that
transfer which are not shown under "Description of
purchased are to be returned Shares Tendered."
by credit to an account
maintained at the Book-Entry Deliver: |_| Check
Transfer Facility other than |_| Share
that designated above. Certificate(s)
to:
Issue: |_| Check
|_| Share Name:_______________________
Certificate(s) (Print)
to:
Address:____________________
Name:_______________________
(Print) ____________________________
(Include Zip Code)
Address:____________________
____________________________
(Include Zip Code)
____________________________
(Taxpayer Identification or
Social Security Number)
|_| Credit unpurchased Shares
tendered by book-entry
transfer to the
Book-Entry Transfer
Facility account set
forth below:
|_| The Depository Trust
Company
____________________________
(Account Number)
(See Substitute Form W-9)
- ----------------------------- -------------------------------
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. No signature guarantee is
required on this Letter of Transmittal if (a) this Letter of
Transmittal is signed by the registered holder(s) (which term,
for purposes of these instructions, includes any participant in
the Book-Entry Transfer Facility's systems whose name appears on
a security position listing as the owner of Shares) of the Shares
tendered herewith and such registered holder(s) has not completed
either the box entitled "Special Payment Instructions" or the box
entitled "Special Delivery Instructions" above or (b) such Shares
are tendered for the account of a financial institution
(including most commercial banks, savings and loan associations
and brokerage houses) that is a participant in the Securities
Transfer Agents Medallion Program or by any other "Eligible
Guarantor Institution" as such term is defined in Rule 17Ad-15
under the Securities Exchange Act of 1934, as amended (an
"Eligible Institution"). In all other cases, all signatures on
this Letter of Transmittal must be guaranteed by an Eligible
Institution. See Instruction 5. If Share Certificates are
registered in the name of a person other than the signer of this
Letter of Transmittal, or if payment is to be made or Share
Certificates not accepted for payment are to be returned to a
person other than the registered holder of the Share Certificates
surrendered, the tendered Share Certificate(s) must be endorsed
or accompanied by appropriate stock powers, in either case signed
exactly as the name or name(s) of the registered holders or
owners appear on the Share Certificate(s), with the signatures on
such Share Certificate(s) or stock powers guaranteed as
aforesaid. See Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND SHARE
CERTIFICATES. This Letter of Transmittal is to be used either if
Share Certificates are to be forwarded herewith or if Shares are
to be delivered by book-entry transfer pursuant to the procedure
set forth in the section entitled "Procedure for Tendering
Shares" of the Offer to Purchase. Share Certificates evidencing
all tendered Shares, or confirmation of a book-entry transfer of
such Shares (a "Book-Entry Confirmation"), if such procedure is
available, 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, together with a properly completed
and duly executed Letter of Transmittal (or a manually signed
facsimile thereof) with any required signature guarantees (or, in
the case of a book-entry transfer, an Agent's Message, as defined
below) and any other documents required by this Letter of
Transmittal, must be received by the Depositary at one of its
addresses set forth herein prior to the Expiration Date (as
defined in the Offer to Purchase). If Share Certificates are
forwarded to the Depositary in multiple deliveries, a properly
completed and duly executed Letter of Transmittal must accompany
each such delivery. Stockholders whose Share Certificates are not
immediately available, who cannot deliver their Share
Certificates and all other required documents to the Depositary
prior to the Expiration Date or who cannot complete the procedure
for delivery by book-entry transfer on a timely basis may tender
their Shares pursuant to the guaranteed delivery procedure
described in Section 3 of the Offer to Purchase. Pursuant to such
procedure: (i) such tender must be made by or through an Eligible
Institution; (ii) a properly completed and duly executed Notice
of Guaranteed Delivery, substantially in the form provided by
Purchaser herewith, must be received by the Depositary prior to
the Expiration Date; and (iii) the Share Certificates, in proper
form for transfer, or a confirmation of a book-entry transfer of
such Shares, if such procedure is available, into the
Depositary's account at the Book-Entry Transfer Facility,
together with a properly completed and duly executed Letter of
Transmittal (or a manually signed facsimile thereof) with any
required signature guarantees (or, in the case of a book-entry
transfer, an Agent's Message), and any other documents required
by this Letter of Transmittal, must be received by the Depositary
within three trading days after the date of execution of the
Notice of Guaranteed Delivery, all as described in Section 3 of
the Offer to Purchase. A "trading day" is any day except
Saturday, Sunday or a federal holiday. The term "Agent's Message"
means a message, transmitted by the Book-Entry Transfer Facility
to, and received by, the Depositary and forming a part of a
Book-Entry Confirmation, which states the Book-Entry Transfer
Facility has received an express acknowledgment from the
participant in the Book-Entry Transfer Facility tendering the
Shares that such participant has received and agrees to be bound
by the terms of this Letter of Transmittal and that Purchaser may
enforce such agreement against the participant.
The method of delivery of this Letter of Transmittal, Share
Certificates and all other required documents, including delivery
through the Book-Entry Transfer Facility, is at the option and
risk of the tendering stockholder, 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.
<PAGE>
No alternative, conditional or contingent tenders will be
accepted and no fractional Shares will be purchased. By execution
of this Letter of Transmittal (or a facsimile hereof), all
tendering stockholders waive any right to receive any notice of
the acceptance of their Shares for payment.
3. INADEQUATE SPACE. If the space provided herein under
"Description of Shares Tendered" is inadequate, the Share
Certificate numbers, the number of Shares evidenced by such Share
Certificates and the number of Shares tendered should be listed
on a separate schedule and attached hereto.
4. PARTIAL TENDERS. (Not applicable to stockholders who
tender by book-entry transfer.) If fewer than all the Shares
evidenced by any Share Certificate delivered to the Depositary
herewith are to be tendered hereby, fill in the number of Shares
which are to be tendered in the box entitled "Number of Shares
Tendered." In such cases, new Share Certificate(s) evidencing the
remainder of the Shares that were evidenced by the Share
Certificates delivered to the Depositary herewith will be sent to
the person(s) signing this Letter of Transmittal, unless
otherwise provided in the box entitled "Special Delivery
Instructions," as soon as practicable after the expiration or
termination of the Offer. All Shares evidenced by Share
Certificates delivered to the Depositary will be deemed to have
been tendered unless otherwise indicated.
5. SIGNATURES ON LETTER OF TRANSMITTAL, STOCK POWERS AND
ENDORSEMENTS. If this Letter of Transmittal is signed by the
registered holder(s) of the Shares tendered hereby, the
signature(s) must correspond with the name(s) as written on the
face of the certificate(s) without any alteration, enlargement or
change whatsoever.
If any Share tendered hereby is owned of record by two or
more persons, all such persons must sign this Letter of
Transmittal. If any of the Shares tendered hereby are registered
in the names of different holders, it will be necessary to
complete, sign and submit as many separate Letters of Transmittal
as there are different registrations of such Shares.
If this Letter of Transmittal is signed by the registered
holder(s) of the Shares tendered hereby, no endorsements of Share
Certificates or separate stock powers are required, unless
payment is to be made to, or Share Certificates evidencing Shares
not tendered or not purchased are to be issued in the name of a
person other than the registered holder(s), in which case the
Share Certificate(s) evidencing the Shares tendered hereby must
be endorsed or accompanied by appropriate stock powers, in either
case signed exactly as the name(s) of the registered holder(s)
appears(s) on such Share Certificate(s). Signatures on such Share
Certificate(s) and stock powers must be guaranteed by an Eligible
Institution.
If this Letter of Transmittal is signed by a person other
than the registered holder(s) of the Shares tendered hereby, the
Share Certificate(s) evidencing the Shares tendered hereby must
be endorsed or accompanied by appropriate stock powers, in either
case, signed exactly as the name(s) of the registered holder(s)
appear(s) on such Share Certificate(s). Signatures on such Share
Certificate(s) and stock powers must be guaranteed by an Eligible
Institution.
If this Letter of Transmittal or any Share Certificate or
stock power is signed by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other
person acting in a fiduciary or representative capacity, such
person should so indicate when signing, and proper evidence
satisfactory to Purchaser of such person's authority so to act
must be submitted.
6. STOCK TRANSFER TAXES. Except as provided in this
Instruction 6, Purchaser will pay all stock transfer taxes with
respect to the transfer and sale of Shares to it or its order
pursuant to the Offer. If, however, payment of the purchase price
of any Shares purchased is to be made to, or if Share
Certificates evidencing Shares not tendered or not purchased are
to be issued in the name of, a person other than the registered
holder(s), the amount of any stock transfer taxes (whether
imposed on the registered owner(s), such other person or
otherwise) payable on account of the transfer to such other
person will be deducted from the purchase price of such Shares
purchased, unless satisfactory evidence to Purchaser of the
payment of such taxes or exemption therefrom is submitted.
Except as provided in this Instruction 6, it will not be
necessary for transfer tax stamps to be affixed to the Share
Certificates evidencing the shares tendered hereby.
<PAGE>
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check
for the purchase price of any Shares tendered hereby is to be
issued, or Share Certificate(s) evidencing Shares not tendered or
not purchased are to be issued, in the name of a person other
than the person(s) signing this Letter of Transmittal or if such
check or any such Share Certificate is to be sent to someone
other than the person(s) signing this Letter of Transmittal or to
the person(s) signing this Letter of Transmittal but at an
address other than that shown in the box entitled "Description of
Shares Tendered," the appropriate boxes on this Letter of
Transmittal must be completed. Stockholders delivering Shares
tendered hereby by book-entry transfer may request that Shares
not purchased be credited to such account maintained at the
Book-Entry Transfer Facility as such stockholder may designate in
the box entitled "Special Payment Instructions." If no such
instructions are given, all such Shares not purchased will be
returned by crediting the account at the Book-Entry Transfer
Facility designated herein as the account from which such Shares
were delivered. See Instruction 1.
8. SUBSTITUTE FORM W-9. Each tendering stockholder (or
other payee) is required to provide the Depositary with a correct
Taxpayer Identification Number ("TIN") and certain other
information on the Substitute Form W-9, which is provided under
"Important Tax Information" below, and to certify whether such
stockholder (or other payee) is subject to backup withholding of
federal income tax. If a tendering stockholder has been notified
by the Internal Revenue Service that such stockholder is subject
to backup withholding, such stockholder must cross out item (2)
of the certification box of the Substitute Form W-9, unless such
stockholder has since been notified by the Internal Revenue
Service that such stockholder is no longer subject to backup
withholding. Failure to provide the information on the Substitute
Form W-9 may subject the tendering stockholder (or other payee)
to 31% federal income tax withholding on the payment of the
purchase price of all Shares purchased from such stockholder. If
the tendering stockholder has not been issued a TIN and has
applied for one or intends to apply for one in the near future,
such stockholder should write "Applied For" in the space provided
for the TIN in Part I of the Substitute Form W-9, sign and date
the Substitute Form W-9, and complete the additional Certificate
of Awaiting Taxpayer Identification Number. If "Applied For" is
written in Part I and the Depositary is not provided with a TIN
by the time of payment, the Depositary will withhold 31% on all
payments thereafter to such stockholder (or other payee) until a
TIN is provided to the Depositary.
9. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests
for assistance may be directed to the Information Agent the
addresses or telephone numbers set forth herein. Additional
copies of the Offer to Purchase, this Letter of Transmittal, the
Notice of Guaranteed Delivery and the Guidelines for
Certification of Taxpayer Identification Number on Substitute
Form W-9 may be obtained from the Information Agent or from
brokers, dealers, commercial banks or trust companies.
10. LOST, DESTROYED OR STOLEN CERTIFICATES. If any
certificate(s) representing Shares has been lost, destroyed or
stolen, the stockholder should promptly notify the Depositary by
checking the box immediately preceding the special
payment/special delivery instructions and indicating the number
of Shares so lost, destroyed or stolen. The Depositary will, in
turn, notify the Company's transfer agent, who will initiate lost
stock proceedings. This Letter of Transmittal and related
documents cannot be processed until the procedures for replacing
lost, destroyed or stolen certificates have been followed.
11. WAIVER OF CONDITIONS. The Conditions of the Offer may
be waived by Purchaser, in whole or in part, at any time in its
sole discretion in the case of any Shares tendered.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A MANUALLY SIGNED
FACSIMILE HEREOF), PROPERLY COMPLETED AND DULY EXECUTED, WITH ANY
REQUIRED SIGNATURE GUARANTEES, OR AN AGENT'S MESSAGE (TOGETHER
WITH SHARE CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER
AND ALL OTHER REQUIRED DOCUMENTS) OR A PROPERLY COMPLETED AND
DULY EXECUTED NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY
THE DEPOSITARY PRIOR TO THE EXPIRATION DATE (AS DEFINED IN THE
OFFER TO PURCHASE).
<PAGE>
IMPORTANT TAX INFORMATION
Under the federal income tax law, a stockholder whose
tendered Shares are accepted for payment is required by law to
provide the Depositary (as payer) with such stockholder's correct
TIN on Substitute Form W-9 above. If such stockholder is an
individual, the TIN is such stockholder's social security number.
If the Depositary is not provided with the correct TIN, the
stockholder or other payee may be subject to a $50 penalty
imposed by the Internal Revenue Service. In addition, payments
that are made to such stockholder or other payee with respect to
Shares purchased pursuant to the Offer may be subject to backup
withholding.
Certain stockholders (including, among others, all
corporations and certain foreign individuals) are not subject to
these backup withholding and reporting requirements. In order for
a foreign individual to qualify as an exempt recipient, such
individual must submit a statement, signed under penalties of
perjury, attesting to such individual's exempt status. Forms of
such statements can be obtained from the Depositary. See the
enclosed Guidelines for Certification of Taxpayer Identification
Number on Substitute Form W-9 for additional instructions.
If backup withholding applies, the Depositary is required
to withhold 31% of any payments made to the stockholder or other
payee. Backup withholding is not an additional tax. Rather, the
tax liability of persons subject to backup withholding will be
reduced by the amount of tax withheld. If withholding results in
an overpayment of taxes, a refund may be obtained from the
Internal Revenue Service.
Purpose of Substitute Form W-9
To prevent backup withholding on payments that are made to
a stockholder or other payee with respect to Shares purchased
pursuant to the Offer, the stockholder is required to notify the
Depositary of such stockholder's correct TIN (or the TIN of any
other payee) by completing the form above certifying that the TIN
provided on Substitute Form W-9 is correct (or that such
stockholder is awaiting a TIN), and that (i) such stockholder is
exempt from backup withholding, (ii) such stockholder has not
been notified by the Internal Revenue Service that such
stockholder is subject to backup withholding as a result of a
failure to report all interest or dividends or (iii) the Internal
Revenue Service has notified such stockholder that such
stockholder is no longer subject to backup withholding.
What Number to Give the Depositary
The stockholder is required to give the Depositary the
social security number or employer identification number of the
record holder of the Shares tendered hereby. If the Shares are in
more than one name or are not in the name of the actual owner,
consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional
guidance on which number to report. If the tendering Stockholder
has not been issued a TIN and has applied for a number or intends
to apply for a number in the near future, the stockholder should
write "Applied For" in the space provided for the TIN in Part I,
sign and date the Substitute Form W-9, and complete the
additional Certificate of Awaiting Taxpayer Identification
Number. If "Applied For" is written in Part I and the Depositary
is not provided with a TIN by the time of payment, the Depositary
will withhold 31% of all payments to such stockholder until a
properly certified TIN is provided to the Depositary.
<PAGE>
- -----------------------------------------------------------------
IMPORTANT STOCKHOLDERS: SIGN HERE
(Also Please Complete Substitute Form W-9 Included Herein)
X:__________________________________________________
X:__________________________________________________
Signature(s) of Holder(s)
Dated: _____________, 199_
(Must be signed by the registered holder(s) exactly as
name(s) appear(s) on Share Certificates or, if tendered by
a participant in a Book-Entry Transfer Facility by the
participant exactly as such participant's name appears on a
security position listing as the owner of the Shares or by
a person(s) authorized to become the registered holder(s)
by certificates and documents transmitted herewith. If
signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or
other person acting in a fiduciary or representative
capacity, please provide the following information. See
Instruction 5.)
Name(s):____________________________________________
____________________________________________
(Please Print)
Capacity (full title):______________________________
Address:____________________________________________
____________________________________________________
(Include Zip Code)
Area Code and Telephone No.:________________________
Taxpayer Identification
or Social Security No.:_____________________________
Guarantee of Signature(s)
(If required - See
Instructions 1 and 5)
Authorized Signature:_______________________________
Name (Please Print):________________________________
Name of Firm:_______________________________________
Address:____________________________________________
____________________________________________________
(Include Zip Code)
Area Code and Telephone Number:_____________________
Dated: _____________, 199_
FOR USE BY FINANCIAL INSTITUTIONS ONLY. PLACE MEDALLION
GUARANTEE IN SPACE BELOW.
- -----------------------------------------------------------------
<PAGE>
Payer's Name: IBJ SCHRODER BANK & TRUST COMPANY
---------------------------------------------------------------------
| SUBSTITUTE | Part I - Taxpayer | Social Security Number |
| | Identification Number - | OR Employee |
| Form W-9 | | Identification Number |
| Department of | | |
| the Treasury | For all accounts, enter | |
| Internal Revenue | taxpayer identification | |
| Service | number in the box at | ---------------------- |
| | right. (For most indi- | (If awaiting TIN write |
| Payer's Request | viduals, this is your | "Applied For") |
| for Taxpayer | social security number. | |
| Identification | If you do not have a | |
| Number (TIN) | number, see OBTAINING A | |
| | NUMBER in the enclosed | |
| | Guidelines). Certify by | |
| | signing and dating | |
| | below. | |
| | | |
| | Note: If the account is | |
| | in more than one name, | |
| | see chart in the | |
| | enclosed Guidelines to | |
| | determine which number | |
| | to give the Payer. | |
|------------------|-------------------------|------------------------|
| | Part II - For Payees exempt from backup with- |
| | holding, see the enclosed Guidelines and com- |
| | plete as instructed therein. |
|------------------|--------------------------------------------------|
| Part III - Certification - Under penalties of perjury, I certify |
| that: |
| |
| (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 either because (a) I am |
| exempt from backup withholding, (b) I have not been notified |
| by the Internal Revenue Service (IRS) that I am subject to |
| backup withholding as a result of a failure to report all |
| interest or dividends, or (c) the IRS has notified me that I |
| am no longer subject to backup withholding. |
| |
| Certification Instructions - You must cross out item (2) above |
| if you have been notified by the IRS that you are subject to |
| backup withholding because of underreporting interest or |
| dividends on your tax return. However, if after being notified |
| by the IRS that you were subject to backup withholding you |
| received another notification from the IRS that you were no |
| longer subject to backup withholding, do not cross out item |
| (2). (Also see instructions in the enclosed Guidelines). |
| |
| __________________________ ________________________ |
| Signature Date |
| |
---------------------------------------------------------------------
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU
WROTE "APPLIED FOR" IN PART I OF THIS SUBSTITUTE FROM 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 (a) 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 (b) I intend |
| to mail or deliver an application in the near future. I |
| understand that, notwithstanding the information I provided in |
| Part III of the Substitute Form W-9 (and the fact that I have |
| completed this Certificate of Awaiting Taxpayer Identification |
| Number), all reportable payments made to me thereafter will be |
| subject to a 31% backup withholding tax until I provide a |
| properly certified taxpayer identification number. |
| |
| __________________________ ________________________ |
| Signature Date |
| |
---------------------------------------------------------------------
NOTE: FAILURE TO COMPLETE AND RETURN THE SUBSTITUTE FORM W-9 MAY
RESULT IN BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO
YOU PURSUANT TO THE OFFER TO PURCHASE. PLEASE REVIEW THE
ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL
DETAILS.
Notice of Guaranteed Delivery
(Not to be Used for Signature Guarantees)
for
Tender of Shares of Common Stock
of
Bryan Steam Corporation
at
$152.00 NET PER SHARE
by
Burnham Acquisition Corporation
a wholly-owned subsidiary of
Burnham Corporation
This Notice of Guaranteed Delivery, or one substantially in
the form hereof, must be used to accept the Offer (as defined
below) if (i) certificates ("Share Certificates") evidencing
shares of Common Stock, par value $10.00 per share (the
"Shares"), of Bryan Steam Corporation, a New Mexico corporation
(the "Company"), are not immediately available, (ii) time will
not permit all required documents to reach IBJ Schroder Bank &
Trust Company (the "Depositary") prior to the Expiration Date (as
defined in the Offer to Purchase (as defined below)) or (iii) the
procedures for book-entry transfer cannot be completed on a
timely basis. This Notice of Guaranteed Delivery may be delivered
by hand or overnight courier or transmitted by facsimile
transmission or mailed to the Depositary. See Section 3 of the
Offer to Purchase. All capitalized terms used but not defined
herein shall have the meanings ascribed to them in the Offer to
Purchase.
To: IBJ Schroder Bank & Trust Company
By Mail: By Facsimile:
P.O. Box 84 (212) 858-2611
Bowling Green Station Confirm Facsimile by Telephone:
New York, NY 10274-0084 (212) 858-2103
Attention: Reorganization
Department
By Hand/Overnight Delivery:
One State Street
New York, NY 10004
Attention: Securities Processing Window, SC-1
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN
ADDRESS OTHER THAN AS SET FORTH ABOVE, OR TRANSMISSION OF
INSTRUCTIONS VIA FACSIMILE TRANSMISSION OTHER THAN AS SET FORTH
ABOVE, DOES NOT CONSTITUTE A VALID DELIVERY.
This form is not to be used to guarantee signatures. If a
signature on a Letter of Transmittal is required to be guaranteed
by an Eligible Institution (as defined in the Offer to Purchase)
under the instructions thereto, such signature guarantee must
appear in the applicable space provided in the signature box on
the Letter of Transmittal.
The Eligible Institution that completes this form must
communicate the guarantee to the Depositary and must deliver the
Letter of Transmittal (or, in the case of book-entry transfers,
an Agent's Message) and certificates for Shares to the Depositary
within the time period shown herein. Failure to do so could
result in a financial loss to such Eligible Institution.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Burnham Acquisition
Corporation, a New Mexico corporation ("Purchaser"), upon the
terms and subject to the conditions set forth in the Offer to
Purchase dated September 29, 1998 (the "Offer to Purchase"), and
the related Letter of Transmittal (which, together with any
amendments or supplements thereof, collectively constitute the
"Offer"), receipt of which is hereby acknowledged, the number of
Shares specified below pursuant to the guaranteed delivery
procedure set forth in Section 3 of the Offer to Purchase.
Number of Shares:_____________ Name(s) of Record Holder(s):
Certificate Nos.
(if applicable):______________ ______________________________
(Please Type or Print)
Check box if Shares will
be delivered by book-entry Address(es):
transfer:
[ ] The Depository Trust ______________________________
Company (Include Zip Code)
Account Number:_______________ Area Code and
Tel. No.:_____________________
Signature(s):_________________
Dated:________________________
THE GUARANTEE SET FORTH BELOW MUST BE COMPLETED
GUARANTEE
(Not to be Used for Signature Guarantees)
The undersigned, an Eligible Institution (as defined in the Offer
to Purchase), hereby guarantees to deliver to the Depositary the
certificates evidencing the Shares tendered hereby, in proper
form for transfer, or Book- Entry Confirmation (as defined in the
Offer to Purchase) with respect to such Shares, in either case
together with delivery of a Letter of Transmittal (or a manually
signed facsimile thereof), properly completed and duly executed,
with any required signature guarantees, or an Agent's Message (as
defined in the Offer to Purchase), and any other documents
required by the Letter of Transmittal, all within three trading
days after the date of execution of this Notice of Guaranteed
Delivery. A "trading day" is any day except Saturday, Sunday or a
U.S. federal holiday.
Name of Firm:___________________ _____________________________
(Authorized Signature)
Address:________________________ Name:________________________
(Please Print or Type)
________________________
(Include Zip Code) Title:_______________________
Area Code Date:________________________
and Tel. No.:___________________
NOTE: DO NOT SEND SHARE CERTIFICATES WITH THIS NOTICE OF
GUARANTEED DELIVERY. SHARE CERTIFICATES SHOULD BE SENT
ONLY TOGETHER WITH YOUR LETTER OF TRANSMITTAL.
Offer to Purchase for Cash
All Outstanding Shares of Common Stock
of
Bryan Steam Corporation
at
$152.00 NET PER SHARE
by
Burnham Acquisition Corporation
a wholly-owned subsidiary of
Burnham Corporation
- -----------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE
AT 12:00 MIDNIGHT, NEW YORK CITY TIME,
ON WEDNESDAY, OCTOBER 28, 1998,
UNLESS THE OFFER IS EXTENDED.
- -----------------------------------------------------------------
September 29, 1998
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
We have been appointed by Burnham Acquisition Corporation,
a New Mexico corporation ("Purchaser") and a wholly-owned
subsidiary of Burnham corporation, a New York corporation
("Parent"), to act as Information Agent in connection with
Purchaser's offer to purchase for cash all outstanding shares of
Common Stock, $10.00 par value (the "Shares"), of Bryan Steam
Corporation, a New Mexico corporation (the "Company"), at $152.00
per Share, net to the seller in cash, upon the terms and subject
to the conditions set forth in the Offer to Purchase, dated
September 29, 1998 (the "Offer to Purchase"), and in the related
Letter of Transmittal (which, together with any supplements or
amendments thereto, collectively constitute the "Offer") enclosed
herewith.
Please furnish copies of the enclosed materials to those of
your clients for whom you hold Shares 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.
2. The Letter of Transmittal to tender Shares for your
use and for the information of your clients. Facsimile
copies of the Letter of Transmittal may be used to tender
Shares.
3. A letter to stockholders of the Company from Albert
J. Bishop, Chairman 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 the stockholders of the Company.
4. The Notice of Guaranteed Delivery to be used to
accept the Offer if neither of the two procedures for
tendering Shares set forth in Section 3 of the Offer to
Purchase can be completed on a timely basis.
5. A printed form of letter which may be sent to your
clients for whose accounts you hold Shares registered in
your name or in the name of your nominee, with space
provided for obtaining such clients' instructions with
regard to the Offer.
<PAGE>
6. Guidelines of the Internal Revenue Service for
Certification of Taxpayer Identification Number on
Substitute Form W-9.
7. A return envelope addressed to IBJ Schroder Bank &
Trust Company, the Depositary.
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT
YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER
AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON WEDNESDAY, OCTOBER 28, 1998, UNLESS THE OFFER IS
EXTENDED.
Please note the following:
1. The tender price is $152.00 per Share, net to the seller
in cash.
2. The Offer is being made for all outstanding Shares. The
Offer is being made pursuant to an Agreement and Plan of Merger,
dated as of September 23, 1998 (the "Merger Agreement"), among
Parent, Purchaser and the Company. The Merger Agreement provides,
among other things, for the making of the Offer by Purchaser and
further provides that, following the Offer and subject to the
satisfaction or waiver of certain conditions, Purchaser will be
merged with and into the Company (the "Merger"), with the Company
surviving the Merger as a wholly owned subsidiary of Parent. As a
result of the Merger, each outstanding Share (other than Shares
held by Parent, Purchaser or any subsidiary of Parent, Purchaser
or the Company, Shares held in the treasury of the Company and
Shares held by stockholders who have properly exercised their
appraisal rights under New Mexico law) will be converted at the
effective time of the Merger into the right to receive $152.00 in
cash, without interest.
3. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE
BEING VALIDLY TENDERED AND NOT WITHDRAWN AT THE EXPIRATION OF THE
OFFER THAT NUMBER OF SHARES THAT CONSTITUTES AT LEAST SIXTY-SIX
AND TWO-THIRDS PERCENT (66-2/3%) PLUS ONE OF THE OUTSTANDING
SHARES ON A FULLY DILUTED BASIS ON THE DATE OF PURCHASE (THE
"MINIMUM CONDITION"). THE OFFER IS ALSO SUBJECT TO CERTAIN OTHER
CONDITIONS CONTAINED IN THE OFFER TO PURCHASE. SEE INTRODUCTION
AND SECTIONS 1 AND 14 OF THE OFFER TO PURCHASE.
4. THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY HAS
DETERMINED THAT THE OFFER AND THE MERGER ARE FAIR TO, AND IN THE
BEST INTERESTS OF, THE COMPANY AND ITS STOCKHOLDERS AND
RECOMMENDS THAT STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR
SHARES PURSUANT TO THE OFFER.
5. The Offer and withdrawal rights will expire at 12:00
midnight, New York City time, on Wednesday, October 28, 1998,
unless the Offer is extended.
6. Tendering stockholders will not be obligated to pay
brokerage fees or commissions or, except as set forth in
Instruction 6 of the Letter of Transmittal, transfer taxes with
respect to the transfer and sale of Shares to it or its order
pursuant to the Offer. However, any tendering stockholder or
other payee who fails to complete and sign the Substitute Form
W-9 that is included in the Letter of Transmittal may be subject
to a required backup federal income tax withholding of 31% of the
gross proceeds payable to such holder or other payee pursuant to
the Offer. See Sections 3 and 5 of the Offer to Purchase.
7. In all cases, payment for Shares purchased pursuant to
the Offer will be made only after timely receipt by the
Depositary of (i) certificates evidencing such Shares (or a
timely Book-Entry Confirmation (as defined in Section 3 of the
Offer to Purchase) with respect to such Shares), (ii) the Letter
of Transmittal (or a manually signed facsimile thereof) properly
completed and duly executed, with all required signature
guarantees or an Agent's Message (as defined in Section 2 of the
Offer to Purchase), and (iii) all other documents required by the
Letter of Transmittal.
In order to take advantage of the Offer, (i) a Letter of
Transmittal (or a manually signed facsimile thereof), properly
completed and duly executed, with any required signature
guarantees, or an Agent's Message and any other required
documents should be sent to the Depositary and (ii) certificates
representing the tendered Shares or a timely
<PAGE>
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 the Shares wish to tender, but it is
impracticable for them to forward their 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 of the Offer to Purchase.
Purchaser will not pay any fees or commission to any
broker, dealer or other person for soliciting tenders of Shares
pursuant to the Offer (other than the Depositary and the
Information Agent, as described in the Offer to Purchase).
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.
Purchaser will pay or will cause to be paid any transfer taxes
payable on the transfer of Shares to it, except as otherwise
provided in Instruction 6 of the Letter of Transmittal.
Any inquiries you may have with respect to the Offer should
be addressed to MACKENZIE PARTNERS, INC., THE INFORMATION AGENT
FOR THE OFFER, AT 156 FIFTH AVENUE, NEW YORK, NEW YORK 10010,
(800) 322-2885.
Requests for additional copies of the enclosed materials
should also be directed to us at the above address and telephone
number.
Very truly yours,
MacKenzie Partners, Inc.
-----------
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL
CONSTITUTE YOU OR ANY OTHER PERSON THE AGENT OF PARENT,
PURCHASER, THE COMPANY, THE DEPOSITARY, THE INFORMATION AGENT OR
ANY AFFILIATE OF ANY OF THEM OR AUTHORIZE YOU OR ANY OTHER PERSON
TO GIVE ANY INFORMATION OR 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.
Offer to Purchase for Cash
All Outstanding Shares of Common Stock
of
Bryan Steam Corporation
at
$152.00 NET PER SHARE
by
Burnham Acquisition Corporation
a wholly-owned subsidiary
of
Burnham Corporation
- -----------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE
AT 12:00 MIDNIGHT, NEW YORK CITY TIME,
ON WEDNESDAY, OCTOBER 28, 1998,
UNLESS THE OFFER IS EXTENDED.
- -----------------------------------------------------------------
September 29, 1998
To Our Clients:
Enclosed for your consideration are the Offer to
Purchase, dated September 29, 1998 (the "Offer to Purchase"), and
the related Letter of Transmittal (which together constitute the
"Offer") relating to the offer by Burnham Acquisition
Corporation, a New Mexico corporation ("Purchaser") and a
wholly-owned subsidiary of Burnham Corporation, a New York
Corporation ("Parent"), to purchase all outstanding shares of
Common Stock, par value $10.00 per share (the "Shares"), of Bryan
Steam Corporation, a New Mexico corporation (the "Company"), at a
purchase price of $152.00 per Share, net to the seller in cash,
without interest thereon, upon the terms and subject to the
conditions set forth in the Offer to Purchase and in the related
Letter of Transmittal enclosed herewith. Also enclosed is the
Letter to Stockholders of the Company, together with a
Solicitation/Recommendation Statement on Schedule 14D-9 filed
with Securities and Exchange Commission by the Company.
WE ARE THE HOLDER OF RECORD OF SHARES HELD BY US FOR
YOUR ACCOUNT. A TENDER OF SUCH SHARES CAN BE MADE ONLY BY US AS
THE HOLDER OF RECORD AND PURSUANT TO YOUR INSTRUCTIONS. THE
LETTER OF TRANSMITTAL IS FURNISHED TO YOU FOR YOUR INFORMATION
ONLY AND CANNOT BE USED BY YOU TO TENDER SHARES HELD BY US FOR
YOUR ACCOUNT.
Accordingly, we request instructions as to whether you
wish to have us tender on your behalf any or all Shares held by
us for your account pursuant to the terms and conditions set
forth in the Offer.
Please note the following:
1. The tender price is $152.00 per Share, net to you
in cash, without interest thereon, upon the terms and
subject to the conditions set forth in the Offer.
2. The Offer is being made for all outstanding Shares.
<PAGE>
3. THE BOARD OF DIRECTORS OF THE COMPANY UNANIMOUSLY
HAS DETERMINED THAT THE OFFER AND THE MERGER (AS DEFINED
BELOW) ARE FAIR TO, AND IN THE BEST INTERESTS OF, THE
COMPANY AND ITS STOCKHOLDERS AND RECOMMENDS THAT
STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR SHARES
PURSUANT TO THE OFFER.
4. The Offer is being made pursuant to an Agreement
and Plan of Merger, dated as of September 23, 1998 (the
"Merger Agreement"), among Parent, Purchaser and the
Company. The Merger Agreement provides, among other things,
for the making of the Offer by Purchaser and further
provides that, following the Offer and subject to the
satisfaction or waiver of certain conditions, Purchaser
will be merged with and into the Company (the "Merger"),
with the Company surviving the Merger as a wholly owned
subsidiary of Parent. As a result of the Merger, each
outstanding Share (other than Shares held by Parent,
Purchaser or any subsidiary of Parent, Purchaser or the
Company and Shares held in the treasury of the Company all
of which shall be cancelled, and Shares held by
stockholders who have properly exercised their right to
dissent and obtain fair value for their Shares under the
New Mexico Business Corporation Act) will be converted at
the effective time of the Merger into the right to receive
$152.00 in cash, without interest.
5. The Offer is conditioned upon, among other things,
there being validly tendered and not withdrawn at the
expiration of the Offer that number of Shares that, when
added to the Shares beneficially owned by Parent and its
affiliates and the Shares Purchaser has the right to
acquire pursuant to the Stockholders' Agreement (as defined
in the Offer to Purchase), constitutes at least sixty-six
and two-thirds percent (66-2/3%) plus one of the
outstanding Shares on a fully diluted basis on the date of
purchase (the "Minimum Condition"). The Offer is also
subject to certain other conditions. See Section 1 and
Section 14 of the Offer to Purchase.
6. Tendering stockholders will not be obligated to pay
brokerage fees or commissions or, except as otherwise
provided in Instruction 6 of the Letter of Transmittal,
stock transfer taxes on the purchase of Shares by Purchaser
pursuant to the Offer.
7. The Offer and withdrawal rights will expire at
12:00 midnight, New York City time, on Wednesday, October
28, 1998, unless the Offer is extended.
8. In all cases, payment for Shares purchased pursuant
to the Offer will be made only after timely receipt by IBJ
Schroder Bank & Trust Company (the "Depositary") of (a)
certificates evidencing such Shares or timely confirmation
of the book-entry transfer of such Shares into the account
maintained by the Depositary at The Depository Trust
Company, pursuant to the procedures set forth in Section 3
of the Offer to Purchase, (b) the Letter of Transmittal (or
a manually signed facsimile thereof), properly completed
and duly executed, with any required signature guarantees
or an Agent's Message (as defined in the Offer to
Purchase), in connection with a book-entry delivery, and
(c) any other documents required by the Letter of
Transmittal.
If you wish to have us tender any or all of the Shares
held by us for your account, please so instruct us by completing,
executing, detaching and returning to us the instruction form
contained in this letter. If you authorize the tender of your
Shares, all such Shares will be tendered unless otherwise
specified on the instruction form. 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 of the Offer.
The Offer is not being made to (nor will tenders be
accepted from or on behalf of) holders of Shares residing in any
jurisdiction in which the making of the Offer or the acceptance
thereof would not be in compliance with the securities, blue sky
or other laws of such jurisdiction. However, Purchaser may, in
its discretion, take such action as it may deem necessary to make
the Offer in any such jurisdiction and extend the Offer to
holders of Shares in such jurisdiction.
2
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
of
Bryan Steam Corporation
by
Burnham Acquisition Corporation
a wholly-owned subsidiary
of
Burnham Corporation
The undersigned acknowledge(s) receipt of your letter, the
enclosed Offer to Purchase, dated September 29, 1998 (the "Offer
to Purchase"), and the related Letter of Transmittal (which
together with the Offer to Purchase constitute the "Offer") in
connection with the offer by Burnham Acquisition Corporation, a
New Mexico corporation ("Purchaser") and a wholly-owned
subsidiary of Burnham Corporation, a New York corporation, to
purchase all outstanding shares of Common Stock, par value $10.00
per share (the "Shares"), of Bryan Steam Corporation, a New
Mexico corporation, at a purchase price of $152.00 per Share, net
to the seller in cash, without interest thereon, upon the terms
and subject to the conditions set forth in the Offer to Purchase.
This will instruct you to tender to Purchaser the number of
Shares indicated below (or if no number is indicated below, all
Shares) which are held by you for the account of the undersigned,
upon the terms and subject to the conditions set forth in the
Offer.
Number of Shares to be Tendered: _____________ Shares*
_________________________________________________________________
SIGN BELOW
Account Number:____________ Signature(s):_______________________
Dated: ___________________, 1998
_________________________________________________________________
Please type or print name(s)
_________________________________________________________________
Please type or print address(es) here
_________________________________________________________________
Area Code and Telephone Number
_________________________________________________________________
Taxpayer Identification or Social Security Number(s)
- ----------------
* Unless otherwise indicated, it will be assumed that you
instruct us to tender all Shares held by us for your account.
3
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 sepa-
rated 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.
- -----------------------------------------------------------------
Give the name and
SOCIAL SECURITY
For this type of account: number of --
- -----------------------------------------------------------------
1. Individual The individual
2. Two or more individuals The actual owner of the
(joint account) account or, if combined
funds, the first individual
on the account (1)
3. Custodian account of a The minor (2)
minor (Uniform Gift to
Minors Act)
4. a. The usual revocable The grantor-trustee (1)
savings trust (grantor is
also trustee)
b. So-called trust account The actual owner (1)
that is not a legal or
valid trust under state
law
5. Sole proprietorship The owner (3)
6. A valid trust, estate, The legal entity (4)
or pension trust
7. Corporate The corporation
8. Association, club, The organization
religious, charitable,
educational or other
tax-exempt organization
9. Partnership The partnership
10. A broker or registered The broker or nominee
nominee
11. Account with the The public entity
Department of
Agriculture in the
name of a public
entity (such as a
state or local
government, school
district, or prison)
that receives
agricultural program
payments
- -------------------------------------------------------------
(1) List first and circle the name of the person whose number
you furnish. If only one person on a joint account has a
social security number, that person's number must be
furnished.
(2) Circle the minor's name and furnish the minor's social
security number.
(3) You must show your individual name, but you may also enter
your business or "doing business as" name. You may use
either your social security number or employer
identification number (if you have one).
(4) List first and circle the name of the legal trust, estate,
or pension trust. (Do not furnish the identifying number of
the personal representative or trustee unless the legal
entity itself is not designated in the account title.)
NOTE: If no name is circled when there is more than one name, the
number will be considered to be that of the first name listed.
<PAGE>
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you don't
know your number, obtain Form SS-5, Application for a Social
Security Number, or Form SS-4, Application for an Employer
Identification Number, at the local office of the Social Security
Administration or the Internal Revenue Service and apply for a
number. United States resident aliens who cannot obtain a social
security number must apply for an ITIN (Individual Taxpayer
Identification Number) on Form W-7.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on payments
of interest, dividends and with respect to broker transactions
include the following:
o A corporation.
o A financial institution.
o An organization exempt from tax under section 501(a), or
an individual retirement plan.
o The United States or any agency or instrumentality
thereof.
o A state, the District of Columbia, a possession of the
United States, or any political subdivision or
instrumentality thereof.
o A foreign government, or any political subdivision, agency
or instrumentality thereof.
o An international organization or any agency or
instrumentality thereof.
o A dealer in securities or commodities required to register
in the United States, the District of Columbia, or a
possession of the United States.
o A real estate investment trust.
o A common trust fund operated by a bank under section
584(a).
o An exempt charitable remainder trust, or a non-exempt
trust described in section 4947.
o An entity registered at all times under the Investment
Company Act of 1940.
o A foreign central bank of issue.
Payments of dividends and patronage dividends not generally
subject to backup withholding include the following:
o Payments to nonresident aliens subject to withholding
under section 1441.
o Payments to partnerships not engaged in a trade or
business in the United States and which have at least one
nonresident alien partner.
o Payments of patronage dividends not paid in money.
o Payments made by certain foreign organizations.
o Payments made to a middleman known in the investment
community as a nominee or who is listed in the most recent
publication of the American Society of Corporate
Secretaries, Inc., Nominee List.
Payments of interest not generally subject to backup withholding
include the following:
o Payments of interest on obligations issued by individuals.
Note: You may be subject to backup withholding if this
interest is $600 or more and is paid in the course of the
payer's trade or business and you have not provided your
correct taxpayer identification number to the payer.
o Payments of tax-exempt interest (including exempt-interest
dividends under section 852).
o Payments described in section 6049(b)(5) to non-resident
aliens.
o Payments on tax-free covenant bonds under section 1451.
o Payments made by certain foreign organizations.
o Payments made to a middleman known in the investment
community as a nominee or who is listed in the most recent
publication of the American Society of Corporate
Secretaries, Inc., Nominee List.
Exempt payees described above should file Form W-9 to avoid
possible erroneous backup withholding.
FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER
IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM,
AND RETURN IT TO THE PAYER. IF THE PAYMENTS ARE INTEREST,
DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO SIGN AND DATE THE FORM.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAX-PAYER IDENTIFICATION
NUMBER.-- If you fail to furnish your taxpayer identification
number to a payer, you are subject to a penalty of $50 for each
such failure unless your failure is due to reasonable cause and
not to willful neglect.
(2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO
WITHHOLDING. -- If you make a false statement with no reasonable
basis which results in no imposition of backup withholding, you
are subject to a penalty of $500.
(3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION. --
Willfully falsifying certifications or affirmations may
subject you to criminal penalties including fines and/or
imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT
OR THE INTERNAL REVENUE SERVICE.
BURNHAM REACHES AGREEMENT TO ACQUIRE BRYAN STEAM
Lancaster, PA September 23, 1998
Peru, IN
Burnham Corporation and Bryan Steam Corporation announced today
that they have entered into a merger agreement pursuant to which
Burnham will acquire all of the outstanding common stock of Bryan
for $152.00 per share in cash. Including transaction expenses of
Bryan and certain other amounts that Burnham has agreed to pay,
the total value of the transaction is approximately $30.4
million. Bryan's Board of Directors unanimously approved the
transaction after a competitive auction process. The acquisition
has the strong support of Bryan's management.
In accordance with the merger agreement, a wholly-owned
subsidiary of Burnham will make a cash tender offer, which is
expected to commence September 30, 1998, for all outstanding
shares of Bryan for $152.00 per share. Any shares not purchased
in the tender offer will be acquired in a second-step merger for
$152.00 per share in cash. The transaction is subject to
customary closing conditions and regulatory approval.
Ten stockholders of Bryan Steam Corporation owning in the
aggregate 55.6% of Bryan's outstanding common stock have
irrevocably agreed to tender their shares to Burnham in the
tender offer and have also granted Burnham an exclusive proxy to
vote their shares in favor of the merger.
Burnham has been a leader in the hydronics industry since
producing its first boiler in 1873. Burnham is a major U.S.
manufacturer of boilers, furnaces, radiators and related
equipment, with sales of $174.6 million in its fiscal year ending
December 31, 1997. Burnham's philosophy is to provide the safest,
most reliable products that are the best values available in the
marketplace.
Bryan, a domestic manufacturer of watertube boilers, is located
in Peru, Indiana, with subsidiaries in Monticello, Indiana and
San Angelo, Texas. Bryan has been in business since 1916 and has
developed a line of watertube boilers that are unique in the
industry. Bryan had sales of $26.3 million in its fiscal year
ending June 30, 1998. Bryan shares Burnham's philosophy of
safety, reliability and value for its products.
After the acquisition, Bryan will operate as a wholly-owned
subsidiary of Burnham. Jesse McVay, current President of Bryan,
will remain as President of Bryan and will be part of the senior
management of Burnham. Bryan's products will continue to be
manufactured at its plants and will be marketed exclusively under
the Bryan label through its existing network of independent
manufacturers' representatives.
The addition of Bryan will allow Burnham to participate in the
domestic watertube boiler market to complement its position in
the firetube and cast-iron boiler markets and to develop an
international market for the watertube product. As a result of
this acquisition, Burnham will be more competitive in the
commercial and industrial hydronics market and Bryan will have
access to the resources it needs for continued growth.
This announcement is neither an offer to purchase nor a solici-
tation of an offer to sell Shares. The Offer is made solely
pursuant to the Offer to Purchase dated September 29, 1998,
and the related Letter of Transmittal and is being made
to all holders of Shares. The Offer is not being made
to (nor will tenders be accepted from or on behalf of)
holders of Shares in any jurisdiction in which the
making of the Offer or the acceptance thereof
would not be in compliance with the laws of
such jurisdiction.
Notice of Offer to Purchase for Cash
All Outstanding Shares of Common Stock
of
BRYAN STEAM CORPORATION
at
$152.00 Net Per Share
by
BURNHAM ACQUISITION CORPORATION
a wholly-owned subsidiary of
BURNHAM CORPORATION
Burnham Acquisition Corporation, a New Mexico corporation
("Purchaser") and a wholly-owned subsidiary of Burnham
Corporation, a New York corporation ("Parent"), is offering to
purchase all outstanding shares of Common Stock, par value $10.00
per share (the "Shares"), of Bryan Steam Corporation, a New
Mexico corporation (the "Company"), for a purchase price of
$152.00 per share (the "Offer Price"), net to the seller in cash,
without interest thereon, upon the terms and subject to the
conditions set forth in the Offer to Purchase and in the related
Letter of Transmittal (which, together with any amendments or
supplements thereto, collectively constitute the "Offer").
- -----------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT
12:00 MIDNIGHT, NEW YORK CITY TIME,
ON WEDNESDAY, OCTOBER 28, 1998,
UNLESS THE OFFER IS EXTENDED.
- -----------------------------------------------------------------
The Offer is being made pursuant to the terms of an
Agreement and Plan of Merger, dated as of September 23, 1998 (the
"Merger Agreement"), among Parent, Purchaser and the Company. The
Merger Agreement provides, among other things, that, following
the Offer and subject to the satisfaction or waiver of certain
conditions, Purchaser will be merged with and into the Company
(the "Merger"), with the Company surviving the Merger as a
wholly-owned subsidiary of Parent. As a result of the Merger,
each outstanding Share (other than Shares held by Parent,
Purchaser or any subsidiary of Parent, Purchaser or the Company,
Shares held in the treasury of the Company and Shares held by
stockholders who have properly exercised their right to dissent
and obtain fair value for their Shares under the New Mexico
Business Corporation Act) will be converted at the effective time
of the Merger into the right to receive in cash the price per
Share paid in the Offer without interest.
Concurrently with the execution of the Merger Agreement,
and as a condition and inducement to Parent and Purchaser
entering into the Merger Agreement, Parent and Purchaser entered
into an agreement dated September 23, 1998 (the "Stockholders'
Agreement"), with certain individuals named therein (each, a
"Proxy Grantor") who in the aggregate beneficially own 106,315
Shares (representing approximately 55.6% of the outstanding
Shares). Pursuant to the Stockholders' Agreement, the Proxy
Grantors have (i) agreed validly to tender (and not to withdraw)
all such Proxy Grantors' Shares in the Offer and (ii) granted
Parent a proxy with respect to the voting of such Shares in favor
of the
<PAGE>
Merger upon the terms and subject to the conditions set forth
therein. For a more detailed description of the Stockholders'
Agreement, see Section 12 of the Offer to Purchase.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY
DETERMINED THAT THE OFFER AND THE MERGER ARE FAIR TO, AND IN THE
BEST INTERESTS OF, THE COMPANY AND ITS STOCKHOLDERS, HAS APPROVED
THE MERGER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY
AND RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS ACCEPT THE OFFER
AND TENDER THEIR SHARES PURSUANT TO THE OFFER.
The Offer is conditioned upon, among other things, there
being validly tendered and not withdrawn at the expiration of the
Offer at least sixty-six and two-thirds percent (66-2/3%) plus
one of the outstanding Shares on a fully diluted basis on the
date of purchase (the "Minimum Condition"). The Offer is also
subject to certain other conditions contained in the Offer to
Purchase. See Introduction and Sections 1 and 14 of the Offer to
Purchase.
For purposes of the Offer, Purchaser will be deemed to have
accepted for payment, and thereby purchased, Shares validly
tendered and not withdrawn as, if and when Purchaser gives oral
or written notice to the Depositary of Purchaser's acceptance of
such Shares for payment. In all cases, payment for Shares
purchased pursuant to the Offer will be made only after timely
receipt by the Depositary of (a) certificates evidencing such
Shares (or a timely Book-Entry Confirmation (as defined in the
Offer to Purchase) with respect to such Shares), (b) a Letter of
Transmittal (or a manually signed facsimile thereof), properly
completed and duly executed, with all required signature
guarantees, or, in connection with a book-entry transfer, an
Agent's Message (as defined in the Offer to Purchase), and (c)
all other documents required by the Letter of Transmittal. In all
cases, payment for Shares purchased pursuant to the Offer will be
made by deposit of the Offer Price therefor with the Depositary,
which will act as agent for tendering stockholders for the
purpose of receiving payment from Purchaser and transmitting
payment to tendering stockholders. Under no circumstances will
interest on the Offer Price be paid by Purchaser, regardless of
any extension of the Offer or any delay in making such payment.
The term "Expiration Date" means 12:00 Midnight, New York
City time, on Wednesday, October 28, 1998, unless and until
Purchaser shall have extended the period of time during which the
Offer is open, in which event the term "Expiration Date" shall
mean the latest time and date at which the Offer, as so extended
by Purchaser, shall expire. Pursuant to the terms of the Merger
Agreement, Purchaser is entitled to extend the Offer in
accordance with applicable law as follows: (i) if any of the
conditions to the Offer are not satisfied or waived by Purchaser
as of any scheduled expiration date, then Purchaser may extend
the Offer from time to time until the earlier of (a) the
consummation of the Offer or (b) twenty business days following
the original expiration date of the Offer specified herein, and
(ii) if all conditions to the Offer are satisfied or waived as of
any scheduled expiration date, then Purchaser may extend the
Offer from time to time by not more than ten business days in the
aggregate. Purchaser may also extend the Offer with the consent
of the Company or as required by law. There can be no assurance
that Purchaser will exercise any of its rights to extend the
Offer.
Subject to the applicable rules and regulations of the
Securities and Exchange Commission, including Rule 14e-1(c) under
the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), relating to Purchaser's obligation to pay for or return
tendered Shares promptly after the termination or withdrawal of
the Offer, and to the provisions of the Merger Agreement,
Purchaser expressly reserves the right to delay acceptance for
payment of or payment for any Shares, to extend the Offer, or to
terminate the Offer and not to accept for payment or pay for any
Shares not theretofore accepted for payment or paid for, upon the
failure to be fulfilled of any of the conditions specified in
Section 14 of the Offer to Purchase, and at any time or from time
to time, to amend the Offer or to waive any conditions to the
Offer in any respect consistent with the provisions of the Merger
Agreement, as such provisions may be amended from time to time,
in each case by giving oral or written notice of such delay,
extension, termination, amendment or waiver to the Depositary.
Any such extension, delay, termination, amendment or waiver
will be followed, as promptly as practicable, by public
announcement. In the case of an extension, Rule 14e-1(d) under
the Exchange Act requires that the announcement be issued no
later than 9:00 a.m., New York City time, on the next business
day after the previously scheduled Expiration Date in accordance
with the public announcement requirements of Rule 14d-4(c) under
the Exchange Act. If Purchaser extends the Offer or if Purchaser
is delayed in its acceptance for payment of or payment for Shares
or is unable to purchase or pay for Shares for any reason, then,
without prejudice to Purchaser's rights under the Offer, tendered
Shares
<PAGE>
may be retained by the Depositary on behalf of Purchaser, and
such Shares may not be withdrawn except to the extent tendering
stockholders are entitled to withdrawal rights.
Except as otherwise provided in the Offer to Purchase,
tenders of Shares made pursuant to the Offer will be irrevocable.
Shares tendered pursuant to the Offer may be withdrawn at any
time prior to the Expiration Date and, unless theretofore
accepted for payment by Purchaser pursuant to the Offer, may also
be withdrawn at any time after November 27, 1998. For a
withdrawal to be effective, a written or facsimile transmission
notice of withdrawal must be timely received by the Depositary at
one of its addresses set forth on the back cover of the Offer to
Purchase and must specify the name of the person who tendered the
Shares to be withdrawn, the number of Shares to be withdrawn and
the name of the registered holder of the Shares to be withdrawn,
if different from the name of the person who tendered the Shares.
If certificates evidencing Shares to be withdrawn have been
delivered or otherwise identified to the Depositary, then prior
to the physical release of such certificates, the tendering
stockholder must also submit the serial numbers shown on such
certificates, and the signature(s) on the notice of withdrawal
must be guaranteed by an Eligible Institution (except in the case
of Shares tendered for the account of an Eligible Institution).
If Shares have been tendered pursuant to the procedures for
book-entry transfer as set forth in Section 3 of the Offer to
Purchase, any notice of withdrawal must specify the name and
number of the account at the Book-Entry Transfer Facility (as
defined in the Offer to Purchase) to be credited with the
withdrawn Shares. Any Shares properly withdrawn will be deemed
not to have been validly tendered for purposes of the Offer, but
may be re-tendered at any subsequent time prior to the Expiration
Date by following any of the procedures described in Section 3 of
the Offer to Purchase. All questions as to the form and validity
(including time of receipt) of notices of withdrawal will be
determined by Purchaser in its sole discretion, whose
determination will be final and binding.
The Company is providing Purchaser with the Company's
stockholder lists and security position listings for the purpose
of disseminating the Offer to holders of Shares in accordance
with the Exchange Act. The Offer to Purchase, the related Letter
of Transmittal and other relevant materials will be mailed to
record holders of Shares, and will be furnished to brokers,
dealers, commercial banks, trust companies and similar persons
whose names, or the names of whose nominees, appear on the
stockholder lists, or, if applicable, who are listed as
participants in a clearing agency's security position listing,
for subsequent transmittal to beneficial owners of Shares.
The information required to be disclosed by Rule
14d-6(e)(1)(vii) under the Exchange Act is contained in the Offer
to Purchase and is incorporated herein by reference.
THE OFFER TO PURCHASE AND LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION AND SHOULD BE READ CAREFULLY BEFORE ANY
DECISION IS MADE WITH RESPECT TO THE OFFER.
Questions and requests for assistance may be directed to
the Information Agent at the telephone numbers and address listed
below. Additional copies of the Offer to Purchase, the Letter of
Transmittal, the Notice of Guaranteed Delivery and other related
materials may be obtained from the Information Agent, and copies
will be furnished promptly at Purchaser's expense. You may also
contact your broker, dealer, commercial bank, trust company or
other nominee for assistance concerning the Offer. No fees or
commissions will be payable to brokers, dealers or other persons
other than the Information Agent for soliciting tenders of Shares
pursuant to the Offer.
The Information Agent for the Offer is:
[Logo of MacKenzie Partners, Inc.]
156 Fifth Avenue
New York, NY 10010
(800) 322-2885 (toll free)
(212) 929-5500 (call collect)
September 29, 1998
AGREEMENT AND PLAN OF MERGER
dated as of September 23, 1998
by and among
BURNHAM CORPORATION,
BURNHAM ACQUISITION CORPORATION
and
BRYAN STEAM CORPORATION
<PAGE>
TABLE OF CONTENTS
ARTICLE A
THE OFFER
A-1.01 The Offer......................................2
A-1.02 Bryan Actions..................................3
A-1.03 Stockholder Lists..............................3
ARTICLE I
PLAN OF MERGER
1.01 The Merger.......................................4
1.02 Effective Time...................................4
1.03 Closing..........................................4
1.04 Articles of Incorporation; By-laws of the
Surviving Corporation; Location of
Principal Office.................................4
1.05 Directors and Officers of the Surviving
Corporation......................................5
1.06 Effects of the Merger............................5
1.07 Further Assurances...............................5
1.08 Shareholders' Approval...........................5
ARTICLE II
CONVERSION OF SHARES
2.01 Conversion of Capital Stock......................6
2.02 Exchange of Certificates.........................7
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
3.01 Organization and Qualification...................9
3.02 Capital Stock...................................10
3.03 Authority Relative to this Agreement............11
3.04 Non-Contravention: Approvals and Consents.......12
3.05 SEC Reports and Financial Statements............13
3.06 Absence of Certain Changes or Events............13
3.07 Absence of Undisclosed Liabilities..............14
3.08 Legal Proceedings...............................14
3.09 Information Supplied; Schedule 14D-9; Offer
Documents and Proxy Statement...................14
3.10 Compliance with Laws and Orders.................15
3.11 Compliance with Agreements; Certain Agreements..15
3.12 Taxes...........................................16
3.13 Benefit Plans; ERISA............................17
3.14 Insurance.......................................19
i
<PAGE>
3.15 Labor Matters...................................20
3.16 Environmental Matters...........................21
3.17 Tangible Property and Assets....................23
3.18 Intellectual Property Rights....................23
3.19 Vote Required...................................25
3.20 Disclosure......................................25
3.21 Effect of Transactions on Manufacturer's
Representatives and Customers...................25
3.22 Bryan's Transaction Costs.......................25
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER AND MERGER
SUB
4.01 Organization and Qualification..................25
4.02 Authority Relative to this Agreement............26
4.03 Non-Contravention; Approvals and Consents.......26
4.04 Legal Proceedings...............................27
4.05 Information Supplied............................27
4.06 Financing.......................................28
ARTICLE V
COVENANTS OF THE COMPANY
5.01 Conduct of Business.............................28
5.02 No Solicitations................................31
ARTICLE VI
ADDITIONAL AGREEMENTS
6.01 Access to Information; Confidentiality..........32
6.02 Preparation of Proxy Statement..................32
6.03 Approval of Shareholders........................33
6.04 Regulatory and Other Approvals..................34
6.05 Employees.......................................34
6.06 Expenses........................................35
6.07 Brokers or Finders..............................35
6.08 Notice and Cure.................................35
6.09 Fulfillment of Conditions.......................36
6.10 Indemnification; Directors' and Officers'
Insurance.......................................36
6.11 Retention of Bryan Name.........................37
6.12 Takeover Laws...................................38
6.13 Subsequent Financial Statements.................38
6.14 Termination Fee; Expenses.......................38
ii
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ARTICLE VII
CONDITIONS
7.01 Conditions to Each Party's Obligation to
Effect the Merger...............................39
7.02 Conditions to Obligation of Buyer and Merger
Sub to Effect the Merger........................40
7.03 Conditions to Obligation of Bryan to Effect
the Merger......................................41
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
8.01 Termination.....................................42
8.02 Effect of Termination...........................43
8.03 Amendment.......................................43
8.04 Waiver..........................................43
ARTICLE IX
GENERAL PROVISIONS
9.01 Non-Survival of Representations; Warranties;
Covenants and Agreements........................44
9.02 Knowledge.......................................44
9.03 Notices.........................................44
9.04 Entire Agreement................................45
9.05 Public Announcements............................45
9.06 No Third Party Beneficiaries....................46
9.07 No Assignment, Binding Effect...................46
9.08 Headings........................................46
9.09 Invalid Provisions..............................46
9.10 Governing Law...................................46
9.11 Counterparts....................................46
9.12 Interpretation..................................47
9.13 Incorporation of Exhibits.......................47
9.14 Enforcement of Agreement; Injunctive Relief.....47
9.15 Joint and Several Obligations...................48
ANNEXES:
Annex A -- Conditions of Offer and List of Encumbrances
EXHIBITS:
Exhibit A - Form of Stockholders Agreement
iii
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SCHEDULES:
Schedule 3.01 - Jurisdictions of Qualification
Schedule 3.04 - Bryan Consents and Approvals
Schedule 3.06 - Material Adverse Changes, etc.
Schedule 3.07 - Undisclosed Liabilities
Schedule 3.08 - Legal Proceedings
Schedule 3.10 - Permits; Legal Compliance
Schedule 3.11 - Contracts and Contract Compliance
Schedule 3.12 - Tax Matters
Schedule 3.13 - Benefit Plans
Schedule 3.14 - Insurance
Schedule 3.15 - Labor Matters
Schedule 3.16 - Environmental Matters
Schedule 3.17 - Exceptions to Title to Personal Property
Schedule 3.18 - Intellectual Property
Schedule 3.21 - Relationships with Representatives
and Customers
Schedule 3.22 - Bryan's Transaction Costs
Schedule 7.02 - Encumbrances
iv
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This AGREEMENT AND PLAN OF MERGER dated as of September 23,
1998 (this "Agreement"), is made and entered into by and among
("BURNHAM CORPORATION"), a New York corporation ("Buyer" or
"Burnham"), BURNHAM ACQUISITION CORPORATION, a New Mexico
corporation wholly owned by Buyer ("Merger Sub"), and BRYAN STEAM
CORPORATION, a New Mexico corporation (prior to the Merger
referred to as "Bryan", and after the Merger referred to as the
"Surviving Corporation").
WHEREAS, the Boards of Directors of Buyer, Merger Sub and
Bryan have each determined that it is advisable and in the best
interests of their respective shareholders to consummate and have
approved the transactions contemplated hereby (in which Merger
Sub will make a tender offer (the "Offer") for all outstanding
shares of Bryan, Merger Sub will subsequently merge with and into
Bryan, and Bryan will thereupon become a wholly-owned subsidiary
of Buyer (the "Merger"));
WHEREAS, the Board of Directors of Bryan has unanimously
adopted a resolution approving the Offer, the Merger, this
Agreement and the transactions contemplated hereby and
recommending that the holders of Bryan Common Stock (as defined
below) tender their shares of Bryan Common Stock in the Offer and
approve the Merger;
WHEREAS, concurrently with the execution hereof and in
order to induce Buyer and Merger Sub to enter into this
Agreement, Buyer and Merger Sub are entering into a Stockholders'
Agreement with ten holders of Bryan Common Stock who collectively
own beneficially and of record 55.6% of the issued and
outstanding shares of common stock of Bryan; and such holders
have, in accordance with Rule 14a-2(b)(2) of the rules
promulgated under the Securities Exchange Act of 1934, as
amended, executed and delivered such Stockholders' Agreement
substantially in form of Exhibit A hereto wherein each such
holder (i) has agreed to tender his shares of Bryan Common Stock
pursuant to the Offer and (ii) has granted to Buyer the right to
vote such holder's shares of common stock of Bryan in favor of
the adoption and approval of the Merger;
WHEREAS, Buyer, Merger Sub and Bryan desire to make certain
representations, warranties and agreements in connection with the
Merger and also to prescribe various conditions to the Merger;
NOW, THEREFORE, in consideration of the foregoing and of
the mutual covenants and agreements and representations and
warranties set forth in this Agreement, and for other good and
valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto agree as follows:
<PAGE>
ARTICLE A
THE OFFER
A-1.01 The Offer.
(a) Provided that this Agreement shall not have been
terminated in accordance with Section 8.01 hereof and subject to
the provisions hereof, Buyer shall cause Merger Sub promptly (but
in no event later than five business days following the public
announcement of the terms of this Agreement) to commence (within
the meaning of Rule 14d-2 under the Securities Exchange Act of
1934, as amended (the "Exchange Act")) an offer to purchase all
outstanding shares of common stock of Bryan, par value $10.00 per
share (the "Bryan Common Stock" or the "Shares"), at a price of
$152.00 per Share, net to the seller in cash (the "Offer").
Subject to the satisfaction of the Offer Conditions (as defined
below) and the terms and conditions of this Agreement, Merger Sub
shall accept for payment and pay for Shares validly tendered and
not withdrawn pursuant to the Offer as soon as practicable under
applicable law. The obligation of Merger Sub to consummate the
Offer and to accept for payment and to pay for any Shares
tendered pursuant thereto shall be subject to only those
conditions set forth in Annex A hereto (the "Offer Conditions"),
which are for the sole benefit of Buyer and Merger Sub and may be
asserted by Buyer or Merger Sub or waived by Buyer or Merger Sub,
in whole or in part, at any time and from time to time in their
sole discretion. Bryan agrees that no Shares held by Bryan or any
of its subsidiaries will be tendered to Merger Sub pursuant to
the Offer. Merger Sub will not, without the prior written consent
of Bryan, (i) decrease or change the amount or form of the
consideration payable in the Offer, (ii) decrease the number of
Shares sought pursuant to the Offer, (iii) impose additional
conditions to the Offer, (iv) change the conditions to the Offer
(provided, that Buyer or Merger Sub in their sole discretion may
waive any of the conditions to the Offer) or (v) make any change
to any other provision of the Offer that is materially adverse to
the holders of the Shares. Merger Sub shall be entitled to extend
the Offer in accordance with applicable law, but if the
conditions set forth in Annex A are satisfied as of any scheduled
expiration date of the Offer, the Offer may not be extended by
more than ten business days in the aggregate, except with the
prior written consent of the Company or as required by law. If
the conditions set forth in Annex A are not satisfied or waived
by Merger Sub as of any scheduled expiration date, Merger Sub may
extend the Offer from time to time until the earlier of the
consummation of the Offer or twenty business days following the
original expiration date of the Offer.
(b) On the date of commencement of the Offer, Buyer
and Merger Sub shall file or cause to be filed with the
Securities and Exchange Commission (the "SEC") a Tender Offer
Statement on Schedule 14D-1 with respect to the Offer (together
with all amendments and supplements thereto, the "Schedule
14D-1"), which shall contain the offer to purchase and related
letter of transmittal and other ancillary Offer documents and
instruments pursuant to which the Offer will be made
(collectively with any supplements or amendments thereto, the
"Offer Documents"). Bryan and its counsel shall be given a
reasonable opportunity to review and comment on the Offer
Documents prior to their filing with the SEC. Buyer and Merger
Sub agree to provide Bryan with, and to consult with Bryan
regarding, any comments that may be received from the SEC or its
staff with respect to the Offer Documents promptly after receipt
thereof.
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<PAGE>
A-1.02 Bryan Actions. (a) Bryan hereby consents to the
Offer and represents and warrants that (i) the making of the
Offer and the other transactions contemplated by this Agreement
have been approved and consented to by the Board of Directors of
Bryan in accordance with applicable law, (ii) Bryan's Board of
Directors (at meetings duly called and held) has unanimously (x)
determined that the Offer and the Merger are fair to and in the
best interests of the stockholders of Bryan, (y) resolved to
recommend acceptance of the Offer and approval of the plan of
merger contained in this Agreement by such stockholders of Bryan,
and (z) resolved to elect, to the extent permitted by law, not to
be subject to any "moratorium", "control share acquisition",
"business combination", "fair price" or other form of
antitakeover laws and regulations (collectively, "Takeover Laws")
of any jurisdiction that may purport to be applicable to this
Agreement, and (iii) McDonald & Company Securities, Inc., Bryan's
independent financial advisor, has advised Bryan's Board of
Directors that, in its opinion, the consideration to be paid in
the Offer and the Merger to Bryan's stockholders is fair, from a
financial point of view, to such stockholders.
(b) Upon commencement of the Offer, Bryan shall file
with the SEC a Solicitation/Recommendation Statement on Schedule
14D-9 (together with all amendments and supplements thereto, the
"Schedule 14D-9") containing the recommendations of its Board of
Directors described in Section A-1.02(a) and hereby consents to
the inclusion of such recommendations in the Offer Documents and
to the inclusion of a copy of the Schedule 14D-9 with the Offer
Documents mailed or furnished to Bryan's stockholders. Buyer,
Merger Sub and their counsel shall be given a reasonable
opportunity to review and comment on the Schedule 14D-9 prior to
its filing with the SEC. Bryan agrees to provide Buyer and Merger
Sub with, and to consult with Buyer and Merger Sub regarding, any
comments that may be received from the SEC or its staff with
respect to the Schedule 14D-9 promptly after receipt thereof.
(c) Bryan hereby agrees that, subject to the terms and
conditions of this Agreement, in the event there shall occur a
change in law or in a binding judicial interpretation of existing
law which would, in the absence of action by Bryan or the Board
of Directors of Bryan specified in such law or interpretation,
prevent Merger Sub, were it to acquire two-thirds of the Shares
then outstanding, from approving and adopting this Agreement
without the affirmative vote of any other holder of Shares, Bryan
will use its best efforts promptly to take such action or cause
such action to be taken.
A-1.03 Stockholder Lists. In connection with the
Offer, Bryan shall promptly furnish Buyer and Merger Sub with
mailing labels, security position listings and any available
listing or computer file containing the names and addresses of
the record holders of the Shares as of the latest practicable
date and shall furnish Buyer and Merger Sub with such information
and assistance (including periodic updates of such information)
as Buyer or Merger Sub or their agents may reasonably request in
communicating the Offer to the record and beneficial holders of
the Shares.
3
<PAGE>
ARTICLE I
PLAN OF MERGER
1.01 The Merger. Upon the terms and subject to the
conditions of this Agreement, at the Effective Time (as defined
in Section 1.02), Merger Sub shall be merged with and into Bryan
and the separate corporate existence of Merger Sub shall
thereupon cease. Bryan shall be the surviving corporation in the
Merger (the "Surviving Corporation"). Merger Sub and Bryan are
sometimes referred to herein as the "Constituent Corporations."
As a result of the Merger, the outstanding shares of capital
stock of the Constituent Corporations shall be converted or
canceled in the manner provided in Article II.
1.02 Effective Time. At the Closing (as defined in Section
1.03), such articles of merger or other appropriate documents (in
each case, "Articles of Merger") shall be duly prepared and
executed by the Constituent Corporations and thereafter delivered
to the Corporation Commission of the State of New Mexico or its
successor (the "New Mexico Corporation Commission") for filing,
as provided in Section 53-14-4 of the New Mexico Business
Corporation Act (the "NMBCA"), on, or as soon as practicable
after, the Closing Date (as defined in Section 1.03) and shall
make all other filings, recordings and publications as required
by the NMBCA. The Merger shall become effective on the date the
Articles of Merger are filed (such date being referred to herein
as the "Effective Time").
1.03 Closing. The closing of the Merger (the "Closing")
will take place at the offices of Barnes & Thornburg, 11 South
Meridian Street, Indianapolis, Indiana 46204, or at such other
place as the parties hereto mutually agree, on a date and at a
time to be specified by the parties, which shall in no event be
later than 10:00 a.m., local time, on the 5th business day
following the day on which the last to be satisfied or waived of
the conditions set forth in Article VII shall be satisfied or, if
permissible, waived in accordance with this Agreement, or on such
other date and time as the parties hereto mutually agree. The
date on which the Closing occurs is hereinafter referred to as
the "Closing Date." At the Closing, Buyer, Merger Sub and Bryan
shall deliver to each other the certificates and other documents
and instruments required to be delivered under Article VII and
take such other actions as may be necessary to consummate the
transactions contemplated by this Agreement.
1.04 Articles of Incorporation; By-laws of the Surviving
Corporation; Location of Principal Office.
(a) Articles of Incorporation. The Articles of
Incorporation of Merger Sub in effect immediately prior to the
Effective Time shall be the Articles of Incorporation of the
Surviving Corporation until thereafter amended as provided by law
and such Articles of Incorporation; provided, however, that
Article I of the Articles of Incorporation of the Surviving
Corporation shall be amended to read in its entirety as follows:
"The name of the Corporation is Bryan Steam Corporation."
(b) By-laws. The By-laws of Merger Sub in effect
immediately prior to the Effective Time shall be the By-laws of
the Surviving Corporation until thereafter amended as provided by
law, the Articles of Incorporation of the Surviving Corporation
and such By-laws.
4
<PAGE>
(c) Location of Principal Office. The location of the
principal office of the Surviving Corporation shall be State Road
19 North, Post Office Box 27, Peru, Indiana 46970.
1.05 Directors and Officers of the Surviving Corporation.
(a) Directors. The individuals listed below shall be
the directors of the Surviving Corporation until their successors
shall have been duly elected or appointed and qualified or until
their earlier death, resignation or removal in accordance with
the Articles of Incorporation and By-laws of the Surviving
Corporation:
H. Jesse McVay
Albert Morrison, III
Ronald L. Griffith
(b) Officers. The individuals listed below shall be
the officers of the Surviving Corporation until their successors
shall have been duly elected or appointed and qualified or until
their earlier death, resignation or removal in accordance with
the Articles of Incorporation and By-laws of the Surviving
Corporation, and the Board of Directors of Bryan will confirm by
resolution the appointment of such officers effective as of the
Effective Time:
H. Jesse McVay, President
Ronald L. Griffith, Vice President
Kurt J. Krauskopf, Treasurer,
Comptroller and Secretary
Robert Berardi, Assistant Treasurer
Tammy McEwen, Assistant Secretary
1.06 Effects of the Merger. Subject to the foregoing, the
Merger shall have the effects specified in accordance with
Section 53-14-6 of the NMBCA.
1.07 Further Assurances. Each party hereto will execute
such further documents and instruments and take such further
actions as may reasonably be requested by one or more of the
others to consummate the Merger, to vest the Surviving
Corporation with full title to all assets, properties, rights,
approvals, immunities and franchises of either of the Constituent
Corporations or to effect the other purposes of this Agreement.
1.08 Shareholders' Approval. In order to consummate the
Merger, Bryan, acting through its Board of Directors, shall
pursuant to Section 6.03 as soon as practicable and in accordance
with (but only if required under) applicable law, promptly and
duly call, give notice of, convene and hold a special shareholder
meeting or its 1998 Annual Meeting of shareholders for the
purpose of considering and taking action upon the Merger and
adopting and approving this Agreement (the "Shareholder
Meeting").
5
<PAGE>
ARTICLE II
CONVERSION OF SHARES
2.01 Conversion of Capital Stock.
(a) Conversion of Capital Stock and Dissenting Shares.
At the Effective Time, by virtue of the Merger and without any
action on the part of the holders thereof:
(i) Capital Stock of Merger Sub. All of the
issued and outstanding shares of the common stock, with no par
value, of Merger Sub ("Merger Sub Common Stock") issued and
outstanding immediately prior to the Effective Time shall remain
outstanding and unchanged after the Merger and shall thereafter
constitute all of the issued and outstanding shares of the
capital stock of the Surviving Corporation ("Surviving
Corporation Common Stock"). Immediately after the Merger, all of
the issued and outstanding shares of common stock of the
Surviving Corporation shall be owned by Buyer.
(ii) Cancellation of Treasury Stock. All shares
of common stock, of Bryan, par value $10.00 per share ("Bryan
Common Stock"), that are owned by Bryan as treasury stock shall
be canceled and retired and shall cease to exist and no stock of
Buyer or other consideration shall be delivered in exchange
therefor.
(iii) Exchange Price for Bryan Common Stock. Each
share of Bryan Common Stock (other than shares to be canceled in
accordance with Section 2.01(a)(ii) and other than Dissenting
Shares (as defined in Section 2.01(b))) issued and outstanding
immediately prior to the Effective Time shall be converted into
and represent the right to receive $152.00 in cash per share (the
"Merger Price"). The Merger Price shall be payable in cash
without interest thereon, upon surrender of the corresponding
Certificate (as defined in Section 2.02(b)) in accordance with
Section 2.02. As of the Effective Time, all shares of Bryan
Common Stock shall no longer be outstanding and shall
automatically be canceled and retired and shall cease to exist,
and each holder of a Certificate representing any such shares
shall cease to have any rights with respect thereto, except the
right to receive the Merger Price per share as provided herein.
(b) Dissenting Shares.
(i) To the extent applicable, each outstanding
share of Bryan Common Stock the holder of which has not voted in
favor of the Merger, has perfected such holder's right to fair
value of such holder's shares in accordance with the applicable
provisions of the NMBCA and has not effectively withdrawn or lost
such right (a "Dissenting Share"), shall not be converted into or
represent a right to receive the Merger Price pursuant to Section
2.01 (a)(iii), but the holder thereof (sometimes referred to
herein as a "Dissenting Shareholder") shall be entitled only to
such rights as are granted by the applicable provisions of the
NMBCA; provided, however, that any Dissenting Share held by a
person at the Effective Time who shall, after the Effective Time,
withdraw the demand for fair value or lose the right to fair
value, in either case pursuant to the NMBCA, shall be deemed to
be converted into, as of the Effective Time, the right to receive
the Merger Price pursuant to Section 2.01(a)(iii).
6
<PAGE>
(ii) Bryan shall give Buyer (x) prompt notice of any
written objection to the proposed adoption and approval of this
Agreement, any written demand for payment of the fair value of
shares, any withdrawals of such demands and any other instruments
received by Bryan served pursuant to the applicable provisions of
the NMBCA relating to dissenting shareholders and (y) the
opportunity to direct all negotiations and proceedings with
respect to demands by dissenting shareholders under the NMBCA.
Bryan will not voluntarily make any payment with respect to any
demands by dissenting shareholders and will not, except with the
prior written consent of Buyer, settle or offer to settle any
such demands.
2.02 Exchange of Certificates.
(a) Exchange Agent.
(i) At the Closing or immediately prior to the
Effective Time, Buyer (x) shall appoint as exchange agent
reasonably satisfactory to Bryan (the "Exchange Agent") in
accordance with an exchange agreement reasonably satisfactory to
Bryan, and (y) shall make available to the Surviving Corporation,
and shall cause to be deposited with the Exchange Agent, the
aggregate amount due to holders of shares of Bryan Common Stock
under Section 2.01(a)(iii) (the "Purchase Price"), to be held for
the benefit of and to be distributed to, holders of shares of
Bryan Common Stock in accordance with this Section 2.02. The
Exchange Agent shall agree to hold such funds (such funds,
together with earnings thereon, being referred to herein as the
"Exchange Fund") for delivery as contemplated by this Section
2.02 and upon such additional terms as may be agreed upon by the
Exchange Agent, Bryan and Buyer.
(ii) The deposit shall be made on the following
terms: (a) the Exchange Agent will be given irrevocable
instructions that monies deposited in the Exchange Fund pursuant
to this Section 2.02 will be applied by the Exchange Agent to
making the cash payments to the former Bryan shareholders
provided for herein; (b) the Exchange Agent, upon the direction
of Buyer or, after the Effective Time, the Surviving Corporation,
may invest in direct obligations of the United States of America
or obligations for which the full faith and credit of the United
States is pledged to provide for the payment of principal and
interest, certificates of deposit issued by commercial banks
having capital and surplus in excess of One Hundred Million
Dollars ($100,000,000), or commercial paper rated A-1 or better
by Standard & Poor's corporation or P-1 by Moody's Investors
Service, Inc.; (c) any net profit resulting from, or interest or
income produced by, such investments will be payable as directed
by the Surviving Corporation (including, if so directed, to it);
provided, that Buyer shall replace any monies lost through any
investments made as contemplated by this Section 2.02, if
required to make payments to former shareholders of Bryan
pursuant to this Agreement, and shall reimburse the Exchange
Agent for all expenses incurred in connection with the
acquisition or liquidation of any such investment; (d) all
expenses of the Exchange Agent will be paid by Buyer or the
Surviving Corporation; and (e) any portion of the Exchange Fund
deposited with the Exchange Agent pursuant to this Section 2.02,
which remains unclaimed by the former shareholders of Bryan for
six (6) months after the Effective Time, will be repaid to the
Surviving Corporation upon demand. If certain Bryan shareholders,
such as shareholders who cannot be located, have not received the
cash to which they are entitled under the terms of this Agreement
within six (6) months after the Effective Time, the Surviving
Corporation will thereafter hold the amount of
7
<PAGE>
cash to which such shareholders are entitled, subject to
applicable law and to the extent that the same has not yet been
paid to a public official pursuant to abandoned property laws,
for their benefit and will act and serve as their agent for the
purpose of holding such funds. To the extent that any former
shareholders of Bryan exercise their rights as Dissenting
Shareholders, payments to them required or authorized by the
NMBCA may be made from the Exchange Fund, but not in excess of
the Merger Price for each share of Bryan Common Stock formerly
owned.
(b) Exchange Procedures.
(i) The record date for the purposes of the
transactions contemplated hereby shall be the Closing Date. As
soon as reasonably practicable after the Effective Time, the
Surviving Corporation shall cause the Exchange Agent to mail to
each holder of record of a certificate or certificates which
immediately prior to the Effective Time represented outstanding
shares of Bryan Common Stock (the "Certificates") converted
pursuant to Section 2.01(a)(iii) into the right to receive the
Merger Price (x) a letter of transmittal (which shall specify
that delivery shall be effected, and risk of loss and title to
the Certificates shall pass, only upon delivery of the
Certificates to the Exchange Agent and shall be in such form and
have such other provisions as the Surviving Corporation may
reasonably specify) and (y) instructions for use in effecting the
surrender of the Certificates in exchange for the Merger Price.
Upon surrender of a Certificate for cancellation to the Exchange
Agent, together with such letter of transmittal duly executed and
completed in accordance with its terms, the holder of such
Certificate shall be entitled to receive in exchange therefor an
amount equal to the Merger Price per share of Bryan Common Stock
represented thereby, which such holder has the right to receive
pursuant to the provisions of this Article II (in accordance with
applicable law), and the Certificate so surrendered shall
forthwith be canceled. In no event shall the holder of any
Certificate be entitled to receive interest on any funds to be
received in the Merger. In the event of a transfer of ownership
of Bryan Common Stock which is not registered in the transfer
records of Bryan, the Merger Price may be issued to a transferee
if the Certificate representing such Bryan Common Stock is
presented to the Exchange Agent accompanied by all documents
required to evidence, to the satisfaction of the Surviving
Corporation, that such transfer had properly occurred and that
any applicable stock transfer taxes had been properly paid.
(ii) Until surrendered as contemplated by this
Section 2.02(b), each Certificate shall be deemed at any time
after the Effective Time to represent only the right to receive
upon such surrender the Merger Price per share of Bryan Common
Stock represented thereby as contemplated by this Article II, and
shall not entitle the holder thereof to any rights of
shareholders of the Surviving Corporation.
(iii) The Surviving Corporation shall pay all
charges and expenses incurred by the Surviving Corporation or the
Exchange Agent in connection with the exchange of Certificates
for cash.
(iv) The parties acknowledge that the Exchange
Agent may require each holder of record of outstanding shares of
Bryan Common Stock to execute and deliver such documents and
instruments as the Exchange Agent may reasonably require to
effectuate the surrender of such shares in exchange for the
Merger Price, including any appropriate affidavits and tax forms.
8
<PAGE>
(c) No Further Ownership Rights in Bryan Common Stock.
All cash paid upon the surrender of shares of Bryan Common Stock
in accordance with the terms hereof shall be deemed to have been
paid in full satisfaction of all rights pertaining to such shares
of Bryan Common Stock. From and after the Effective Time, Bryan's
stock transfer books shall be closed and there shall be no
further registration of transfers on the stock transfer books of
the Surviving Corporation of the shares of Bryan Common Stock
which were outstanding immediately prior to the Effective Time.
If, after the Effective Time, Certificates are presented to the
Surviving Corporation for any reason, they shall be canceled and
exchanged as provided in this Article II. If any Certificates
shall not have been surrendered prior to two years after the
Effective Time, unclaimed funds payable with respect to such
Certificates shall, to the extent permitted by applicable law,
become the property of the Surviving Corporation, free and clear
of all claims or interest of any person previously entitled
thereto.
(d) No Further Ownership Rights in Merger Sub Common
Stock. All shares of common stock of the Surviving Corporation
(the "Surviving Corporation Common Stock") issued upon the
surrender of shares of Merger Sub Common Stock in accordance with
the terms hereof shall be deemed to have been issued in full
satisfaction of all rights pertaining to such shares of Merger
Sub Common Stock, and there shall be no further registration of
transfers on the stock transfer books of the Surviving
Corporation of the shares of Merger Sub Common Stock that were
outstanding immediately prior to the Effective Time. If, after
the Effective Time, certificates representing Merger Sub Common
Stock are presented to the Surviving Corporation for any reason,
they shall be canceled and exchanged as provided in Article II.
(e) Termination of Exchange Fund. Any portion of the
Exchange Fund that remains undistributed to the shareholders of
Bryan six (6) months after the Effective Time shall be delivered
to the Surviving Corporation, upon demand, and any shareholders
of Bryan who have not theretofore complied with this Article II
shall thereafter look only to the Surviving Corporation (subject
to abandoned property, escheat and other similar laws) as general
creditors for payment of their claims for the Merger Price per
share. Neither Buyer nor the Surviving Corporation shall be
liable to any holder of shares of Bryan Common Stock for cash
representing the Merger Price delivered from the Exchange Fund or
otherwise to a public official pursuant to any applicable
abandoned property, escheat or similar law.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Bryan represents and warrants to Buyer and Merger Sub
as follows:
3.01 Organization and Qualification. (a) Bryan is a
corporation duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation and has full
corporate power and authority to conduct its business as and to
the extent now conducted and to own, use and lease its assets and
properties. Bryan is duly qualified, licensed or admitted to do
business and is in good standing in each jurisdiction listed on
Schedule 3.01 hereto in which the ownership, use or leasing of
its assets and properties, or the conduct or nature of its
business, makes such qualification, licensing or admission
necessary, except for such failures to be so
9
<PAGE>
qualified, licensed or admitted and in good standing which,
individually or in the aggregate, (i) are not having and could
not be reasonably expected to have a material adverse effect on
Bryan, and (ii) could not be reasonably expected to have a
material adverse effect on the validity or enforceability of this
Agreement or on the ability of Bryan to perform its obligations
hereunder. As used in this Agreement, any reference to any event,
change or effect being "material" or "materially adverse" or
having a "material adverse effect" on or with respect to an
entity (or group of entities taken as a whole) means such event,
change or effect is material or materially adverse, as the case
may be, to the business, condition (financial or otherwise),
properties, assets (including intangible assets), liabilities
(including contingent liabilities), prospects or results of
operations of such entity (or, if with respect thereto, of such
group of entities taken as a whole). Bryan has previously
delivered to Buyer accurate and complete copies of the Articles
of Incorporation and the By-laws of Bryan and each of its
subsidiaries as currently in effect.
(b) Except for Monticello Exchanger and Manufacturing Co.,
Inc. ("Memco") and Wendland Manufacturing Co., Inc. ("Wendland"),
Bryan does not directly or indirectly own any equity or similar
interest in, or any interest convertible into or exchangeable or
exercisable for, any equity or similar interest in, any
corporation, partnership, joint venture or other business
association or entity. All outstanding shares of capital stock of
each of Memco and Wendland are duly authorized, validly issued,
fully paid, non-assessable and owned, directly or indirectly, by
Bryan free and clear of any liens, claims or encumbrances. Each
of Memco and Wendland is a corporation duly organized, validly
existing and in good standing under the laws of its jurisdiction
of incorporation and has full corporate power and authority to
conduct its business as and to the extent now conducted and to
own, use and lease its assets and properties. Each of Memco and
Wendland is duly qualified, licensed or admitted to do business
and is in good standing in each jurisdiction listed on Schedule
3.01 hereto in which the ownership, use or leasing of its assets
and properties, or the conduct or nature of its business, makes
such qualification, licensing or admission necessary, except for
such failures to be so qualified, licensed or admitted and in
good standing which, individually or in the aggregate, (i) are
not having and could not be reasonably expected to have a
material adverse effect on either Memco or Wendland as the case
may be, and (ii) could not be reasonably expected to have a
material adverse effect on the validity or enforceability of this
Agreement or on the ability of Bryan to perform its obligations
hereunder.
3.02 Capital Stock, etc.. (a) The authorized capital stock
of Bryan consists solely of 200,000 shares of common stock, par
value $10.00 per share (previously defined as "Bryan Common
Stock"), and 2,500 shares of preferred stock (the "Preferred
Stock"). As of the date hereof, 191,284 shares of Bryan Common
Stock are issued and outstanding, 8,716 shares of Bryan Common
Stock are held in the treasury of Bryan; and no shares of
Preferred Stock are issued or outstanding. All of the issued and
outstanding shares of Bryan Common Stock are duly authorized,
validly issued, fully paid and nonassessable. Except pursuant to
this Agreement, there are no outstanding subscriptions, options,
warrants, rights (including "phantom" stock rights), preemptive
rights or other contracts, commitments, understandings or
arrangements, including any right of conversion or exchange under
any outstanding security, instrument or agreement (together,
"Options"), obligating Bryan to issue or sell any shares of
capital stock of Bryan or to grant, extend or enter into any
Option with respect thereto.
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(b) There are no outstanding contractual obligations
of Bryan to repurchase, redeem or otherwise acquire any shares of
Bryan Common Stock or to provide funds to, or make any investment
(in the form of a loan, capital contribution or otherwise) in any
other person.
(c) There are no obligations to issue or to make any
payments in respect of any shares of Preferred Stock; no person
or entity has any right to make any claim in any manner
whatsoever as a holder or a prior holder of any Preferred Stock
or any rights related in any way to any shares of Preferred
Stock; and no person or entity has any right to claim to be a
holder of any rights related in any way to the Preferred Stock.
(d) Except as expressly provided herein or in the
Schedules hereto, no notice to obtain approval of the Merger is
required to be sent to any person or entity, whether or not
entitled to vote, other than the holders of record of Bryan
Common Stock.
(e) There are no outstanding subscriptions, options,
warrants, rights (including "phantom" stock rights), preemptive
rights or other contracts, commitments, understandings or
arrangements, including any right of conversion or exchange under
any outstanding security, instrument or agreement, obligating
either Wendland or Memco to issue or sell any shares of its
capital stock (each, a "Subsidiary Option") or to grant, extend
or enter into any Subsidiary Option with respect thereto. There
are no outstanding contractual obligations of either Wendland or
Memco to provide funds to, or make any investment (in the form of
a loan, capital contribution or otherwise) in, any other person
or entity.
3.03 Authority Relative to this Agreement. Bryan has full
corporate power and authority to enter into this Agreement and,
subject to obtaining Shareholders' Approval (as defined in
Section 6.03) with respect to the Merger, to perform its
obligations hereunder and to consummate the transactions
contemplated hereby. The execution, delivery and performance of
this Agreement by Bryan and the consummation by Bryan of the
transactions contemplated hereby have been duly and validly
approved by the Board of Directors of Bryan, the Board of
Directors of Bryan has recommended adoption of this Agreement by
the shareholders of Bryan and directed that this Agreement be
submitted to the shareholders of Bryan for their consideration,
and no other corporate proceedings on the part of Bryan or its
shareholders are necessary to authorize the execution, delivery
and performance of this Agreement by Bryan and the consummation
by Bryan of the transactions contemplated hereby other than
obtaining Shareholders' Approval (as defined in Section 6.03).
This Agreement has been duly and validly executed and delivered
by Bryan and constitutes a legal, valid and binding obligation of
Bryan enforceable against Bryan in accordance with its terms,
except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, moratorium or other
similar laws affecting the enforcement of creditors' rights
generally and by general equitable principles (regardless of
whether such enforceability is considered in a proceeding in
equity or at law).
3.04 Non-Contravention; Approvals and Consents.
(a) The execution and delivery of this Agreement by
Bryan does not, and the performance by Bryan of its obligations
hereunder and the consummation of the transactions contemplated
hereby will not, conflict with, result in a violation or breach
of, constitute (with or without notice or lapse of time or both)
a default under, or result in the creation or imposition of
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any liens, mortgages, encumbrances, pledges or security interests
of any kind (each a "Lien') upon any of the assets or properties
of Bryan under any of the terms, conditions or provisions of (i)
the Articles of Incorporation or By-laws of Bryan, or (ii)
subject to the obtaining of Shareholders' Approval and the taking
of the actions described in paragraph (b) of this Section, (x)
any statute, law, rule, regulation, requirement, code or
ordinance (together, "Laws"), or any judgment, decree, binding
agreement or order (together, "Orders"), of or with any court,
tribunal, arbitrator, authority, agency, commission, official or
other instrumentality of the United States, any foreign country
or any domestic or foreign state, county, city or other political
subdivision (a "Governmental or Regulatory Authority"),
applicable to Bryan or any of its assets or properties, or (y)
any note, bond, mortgage, security agreement, indenture, license,
franchise, permit, concession, contract, lease or other
instrument, obligation or agreement of any kind (each a
"Contract", and together, "Contracts") to which Bryan or any of
its Subsidiaries is a party or by which Bryan or any of its
Subsidiaries or any of its assets or properties is bound,
excluding from the foregoing clauses (x) and (y) conflicts,
violations, breaches, defaults, terminations, modifications,
accelerations and creations and impositions of Liens which,
individually or in the aggregate, could not be reasonably
expected to have a material adverse effect on the business or a
material product line of Bryan and its Subsidiaries or on the
ability of Bryan to consummate the transactions contemplated by
this Agreement. As used in this Agreement, "Subsidiary" means,
with respect to any party, any corporation or other organization,
whether incorporated or unincorporated, of which more than fifty
percent (50%) of either the equity interests in, or the voting
control of, such corporation or other organization is, directly
or indirectly through Subsidiaries or otherwise, beneficially
owned by such party.
(b) Except (i) for the filing of a premerger
notification report by Bryan under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, and the rules and
regulations thereunder (the "HSR Act"), (ii) for the filing of
the Proxy Statement (as defined in Section 3.09) with the
Securities and Exchange Commission (the "SEC") pursuant to the
Securities Exchange Act of 1934, as amended, and the rules and
regulations thereunder (the "Exchange Act") and clearance of any
SEC comments thereon, (iii) for the filing of the Articles of
Merger required by the NMBCA with the New Mexico Corporate
Commission and appropriate documents with the relevant
authorities of other states in which the Constituent Corporations
are qualified to do business, (iv) for the filing of Schedule
14D-1 and Schedule 14D-9, and (v) as disclosed in Schedule 3.04
hereto, no consent, approval or action of, filing with or notice
to any Governmental or Regulatory Authority or other public or
private third party is necessary or required under any of the
terms, conditions or provisions of any Law or Order of any
Governmental or Regulatory Authority or any Contract to which
Bryan is a party or by which Bryan or any of its assets or
properties is bound for the execution and delivery of this
Agreement by Bryan, the performance by Bryan of its obligations
hereunder or the consummation of the transactions contemplated
hereby, other than such consents, approvals, actions, filings and
notices which the failure to make or obtain, as the case may be,
individually or in the aggregate, could not be reasonably
expected to have a material adverse effect on Bryan or on the
ability of Bryan to consummate the transactions contemplated by
this Agreement.
3.05 SEC Reports and Financial Statements. (a) Bryan
delivered to Buyer prior to the execution of this Agreement a
true and complete copy of each form, report, schedule,
registration statement, definitive proxy statement and other
document, including any financial statements,
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exhibits or schedules included or incorporated by reference
(together with all amendments thereof and supplements thereto)
filed by Bryan with the SEC since July 1, 1995 whether or not the
same was required to have been filed under applicable law (as
such documents have since the time of their filing been amended
or supplemented, the "Bryan SEC Reports"), which includes all the
documents (other than preliminary material) that Bryan was
required to file with the SEC since such date. As of their
respective dates, each of the Bryan SEC Reports (i) complied as
to form in all material respects with the requirements of the
Securities Act of 1933, as amended, and the rules and regulations
thereunder (the "Securities Act"), or the Exchange Act, as the
case may be, (ii) did not contain any untrue statement of a
material fact or omit to state a material fact required to be
stated or incorporated by reference therein or necessary in order
to make the statements therein, in light of the circumstances
under which they were made, not misleading and (iii) was timely
filed pursuant to the Securities Act and the Exchange Act.
(b) The audited consolidated financial statements and
unaudited interim financial statements (including, in each case,
the notes, if any, thereto) included in Bryan SEC Reports (the
"Bryan Financial Statements") or contained in filings subsequent
to the date hereof complied or will comply as to form in all
material respects with the published rules and regulations of the
SEC with respect thereto, were or will be prepared in accordance
with United States generally accepted accounting principles
("GAAP") applied on a consistent basis (except as may be
indicated therein or in the notes thereto and except with respect
to unaudited statements as permitted by Form 10-Q of the SEC) and
fairly present (subject, in the case of the unaudited interim
financial statements, to normal, recurring year-end audit
adjustments which are not expected to be, individually or in the
aggregate, materially adverse to Bryan) the consolidated
financial position of Bryan and its Subsidiaries as at the
respective dates thereof and the results of their consolidated
operations and cash flows for the respective periods then ended.
3.06 Absence of Certain Changes or Events. Except as
disclosed in Schedule 3.06 hereto, (a) since June 30, 1998 there
has not been any change, event or development having, or that
could be reasonably expected to have (individually or when
aggregated with other such changes, events and developments) a
material adverse effect on Bryan, other than those occurring as a
result of general economic or financial conditions and other than
developments which are not unique to Bryan but also generally
affect other persons who participate or are engaged in the lines
of business in which Bryan participates or is engaged, and (b)
except as disclosed in Schedule 3.06 hereto, between such date
and the date hereof (i) Bryan has conducted its business only in
the ordinary course consistent with past practice and (ii) Bryan
has not taken any action which, if taken after the date hereof,
would constitute a breach of any provision of clause (ii) of
Section 5.01(b).
3.07 Absence of Undisclosed Liabilities. Except for matters
reflected or reserved against in the balance sheet dated June 30,
1998 included in Bryan Financial Statements or as disclosed in
Schedule 3.07 hereto, neither Bryan nor any of its Subsidiaries
has at such date, or has incurred since that date, any
liabilities or obligations of any nature, whether accrued,
absolute, contingent or otherwise, that would be required by GAAP
to be reflected on a consolidated balance sheet of Bryan and its
Subsidiaries (including the notes thereto), except liabilities or
obligations (i) which were incurred in the ordinary course of
business consistent with past practice and (ii) which have not
been, and could not be reasonably expected to be, individually or
in the aggregate, materially adverse to Bryan and its
Subsidiaries.
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3.08 Legal Proceedings. Except as disclosed in Schedule
3.08 hereto, (i) there are no claims, actions, suits,
arbitrations, proceedings or any Governmental or Regulatory
Authority investigations or audits pending, or to the knowledge
of Bryan threatened, against, relating to or affecting Bryan,
Wendland, Memco or any of their respective assets or properties,
and there are no facts or circumstances known to Bryan that could
be reasonably expected to give rise to any such claim, action,
suit, arbitration, proceeding, investigation or audit (other than
threatened claims, actions and suits which, individually or in
the aggregate, cannot reasonably be expected to have an adverse
effect on Bryan or on the ability of Bryan to consummate the
Merger); provided, however, that Bryan has been named as a
defendant in litigation involving claims relating to exposure to
asbestos disclosed on Schedule 3.08 ("Asbestos Suits") and Bryan
is likely to be named as defendant in additional Asbestos Suits
prior to the Closing Date, and (ii) neither Bryan, Wendland nor
Memco is subject to any Order of any Governmental or Regulatory
Authority.
3.09 Information Supplied; Schedule 14D-9; Offer Documents
and Proxy Statement.
(a) None of the information supplied or to be supplied
by or on behalf of Bryan or any affiliate of Bryan for inclusion
in the Offer Documents and any other schedule or document
required to be filed with the SEC in connection with the Offer
and the Merger will, at the times such documents are filed with
the SEC and are mailed to stockholders of Bryan, contain any
untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which
they are made, not misleading, or to correct any statement made
in any communication with respect to the Offer previously filed
with the SEC or disseminated to the stockholders of Bryan. The
Schedule 14D-9 will not, at the time the Schedule 14D-9 is filed
with the SEC and at all times prior to the purchase of Shares by
Merger Sub pursuant to the Offer, contain any untrue statement of
a material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in
light of the circumstances under which they are made, not
misleading, except that no representation or warranty is made by
Bryan with respect to information supplied in writing by Buyer,
Merger Sub or an affiliate of Buyer or Merger Sub expressly for
inclusion therein. The Schedule 14D-9 will comply as to form in
all material respects with the provisions of the Exchange Act and
the rules and regulations of the SEC thereunder.
(b) The proxy statement relating to the Shareholder
Meeting, including the letter to stockholders, notice of meeting,
proxy statement and form of proxy, the information statement and
any other information that may be provided in writing to holders
of Bryan Common Stock in connection with the Merger, and any
schedules required to be filed with the SEC in connection
therewith, each as amended or supplemented from time to time (as
so amended and supplemented, the "Proxy Statement"), and any
other documents to be filed by Bryan with any other Governmental
or Regulatory Authority in connection with the Merger and the
other transactions contemplated hereby will not, on the date of
its filing or, in the case of the Proxy Statement, at the date it
is mailed to shareholders, at the time of the Shareholder Meeting
and at the Effective Time, contain any untrue statement of a
material fact, omit to state any material fact required to be
stated therein or necessary to make the statements therein, in
light of the circumstances under which they are made, not
misleading or omit to state any material fact
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required to correct any statement made in any earlier
communication with respect to the solicitation of any proxy or
approval for the Merger, except that no representation is made by
Bryan with respect to information supplied in writing by or on
behalf of Buyer and Merger Sub expressly for inclusion therein
and information incorporated by reference therein from documents
filed by Buyer or any of its Subsidiaries with the SEC. The Proxy
Statement and any such other documents filed by Bryan with the
SEC under the Exchange Act will comply as to form in all material
respects with the requirements of the Exchange Act, to the extent
applicable.
(c) Neither the information supplied or to be supplied in
writing by or on behalf of Bryan for inclusion in any document to
be filed by Buyer or Merger Sub with the SEC nor any other
Governmental or Regulatory Authority in connection with the
Merger and the other transactions contemplated hereby will, on
the date of its filing, contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary to make the statements therein, in
light of the circumstances under which they are made, not
misleading.
3.10 Compliance with Laws and Orders. Set forth on Schedule
3.10 are all permits, licenses, variances, exemptions, orders and
approvals of all Governmental and Regulatory Authorities that are
currently held by Bryan, Wendland or Memco or for which Bryan,
Wendland or Memco has applied. Bryan and its subsidiaries hold
all permits, licenses, variances, exemptions, orders and
approvals of all Governmental and Regulatory Authorities
necessary for the lawful conduct of their respective businesses
("Permits"), except for failures to hold such permits, licenses,
variances, exemptions, orders and approvals which, individually
or in the aggregate, are not having and could not be reasonably
expected to have a material adverse effect on Bryan and its
subsidiaries taken as a whole. Bryan and its subsidiaries are in
compliance with the terms of the Permits, except failures so to
comply which, individually or in the aggregate, are not having
and could not be reasonably expected to have a material adverse
effect on Bryan and its subsidiaries taken as a whole. Except as
set forth in detail on Schedule 3.10, Bryan and its subsidiaries
are not in violation of or default under any Law or Order of any
Governmental or Regulatory Authority, except for violations
which, individually or in the aggregate, are not having and could
not be reasonably expected to have a material adverse effect on
Bryan and its subsidiaries taken as a whole.
3.11 Compliance with Agreements; Certain Agreements. Set
forth on Schedule 3.11 are all Contracts under which either
Bryan, Wendland or Memco have any rights, entitlements, duties or
obligations, other than (i) manufacturer's representative
contracts written on one of the two standard forms disclosed to
Buyer, (ii) contracts for the purchase of materials, supplies or
services in the ordinary course of business consistent with past
practice, no one of which (and no group of related contracts of
which) involves an aggregate purchase price in excess of $250,000
and each of which contracts is to be fully performed within 90
days after its commencement, and (iii) contracts for the sale of
finished goods in the ordinary course of business consistent with
past practice, no one of which contracts (and no group of related
contracts of which) involves an aggregate selling price in excess
of $150,000 and no one of which (other than contracts with
aggregate selling prices of not more than $500,000) has been in
effect, without being fully performed, for more than 150 days.
Except as disclosed in Schedule 3.11 hereto, neither Bryan, its
Subsidiaries nor, to the knowledge of Bryan, any other party
thereto, is in breach or violation of, or in default in the
performance or observance of any term or provision of, and no
event has occurred which, with notice or lapse of time or both,
could be reasonably expected to result in a
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default under, (i) the Articles of Incorporation or By-laws of
Bryan or (ii) any Contract to which Bryan is a party or by which
Bryan or any of its assets or properties is bound, except in the
case of clause (ii) for breaches, violations and defaults which,
individually or in the aggregate, are not having and could not be
reasonably expected to have a material adverse effect on Bryan.
3.12 Taxes.
(a) Each of Bryan and its Subsidiaries has filed all
federal and all material foreign, state and local tax reports and
returns required to be filed and except as disclosed on Schedule
3.12, has duly paid all taxes shown as due thereon, including,
without limitation, income, capital stock, gross receipts, net
proceeds, ad valorem, value added, turnover, sales, use, real
estate transfer, property, personal property (tangible and
intangible), stamp, leasing, lease, user, excise, franchise,
transfer, fuel, vehicle sales, excess profits, occupational and
interest equalization, unitary, severance, withholding, social
security, employment and other taxes, duties, assessments and
charges (including, without limitation, the recapture of any tax
items such as investment tax credits), together with all
interest, penalties and additions imposed with respect to such
amounts, which are due on or before the date hereof or claimed to
be due by federal, state, or local taxing authorities or which
are payable on or before the date hereof with respect to the
business and operations of Bryan and its Subsidiaries
(collectively, "Taxes"). All such returns are accurate and
complete in all material respects. There are no tax liens upon
any property or assets of Bryan and its Subsidiaries, except
liens for Taxes not yet due and payable. All Taxes (including
interest and penalties) applicable for all periods prior to the
Closing or other governmental charges upon Bryan and its
Subsidiaries or their assets, income or revenues have been or
will be paid (if due) or, if not currently payable, reserved
against in accordance with GAAP. Bryan and its Subsidiaries have
not executed any waivers of the statute of limitations on the
right of the Internal Revenue Service (the "IRS") or any state or
local taxing authority to assess additional Taxes or to contest
the income or loss with respect to any tax return. The basis of
any depreciable assets, and the methods used in determining
allowable depreciation (including cost recovery), held by Bryan
and its Subsidiaries, are substantially correct and in compliance
with the Internal Revenue Code of 1986, as amended (the "Code"),
and all regulations thereunder.
(b) No issues have been raised that are currently
pending by any taxing authority in connection with any of the
aforesaid tax returns or reports. No issues have been raised in
any examination by any taxing authority with respect to Bryan and
its Subsidiaries which, by application of similar principles,
reasonably could be expected to result in a material proposed
deficiency for any other period not so examined. The items of
income and deductions reflected on the federal income tax returns
and comparable state and local returns filed by or on behalf of
Bryan and its Subsidiaries for all taxable years (including the
supporting schedules filed therewith), available copies of which
have been supplied (or will be promptly supplied upon request) to
Buyer, state accurately in all material respects the receipts and
expenditures of Bryan and its Subsidiaries, and the same were
derived from the books and records of Bryan.
(c) Bryan and its Subsidiaries have not entered into
any joint venture, partnership, or other arrangement or contract
which is treated as a partnership for federal income tax
purposes.
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(d) None of Bryan or any of its Subsidiaries has ever
been a "consenting corporation," within the meaning of Section
341(f)(l) of the Code, or comparable provisions of any state
statutes, and none of the assets of Bryan and its Subsidiaries is
subject to an election under Section 341(f) of the Code or
comparable provisions of any state statutes.
(e) No property of Bryan and its Subsidiaries is
property which Bryan or Buyer is or will be required to treat as
being owned by another person pursuant to the provisions of
Section 168(f)(8) of the Code, as in effect prior to the Tax
Reform Act of 1986.
(f) No property of Bryan and its Subsidiaries is "tax
exempt use property" as such term is defined in Section 168(h) of
the Code.
(g) None of the properties or assets of Bryan and its
Subsidiaries is tax-exempt bond financed property within the
meaning of Section 168(g)(5) of the Code.
(h) None of Bryan nor any of its Subsidiaries nor any
predecessor thereof is or has been, or has filed a tax return
claiming that it is or has been, an Electing Small Business
Corporation pursuant to the provisions of Subchapter S of the
Code.
(i) None of Bryan or its Subsidiaries (i) has been a
member of an affiliated group filing a consolidated federal
income tax return (other than a group the common parent of which
was Bryan) or (ii) has any liability for the Taxes of any person
(other than any of Bryan and its Subsidiaries) under Treas. Reg.
ss. 1.1502-6 (or any provision of state, local or foreign law),
as a transferor or successor, by contract or otherwise.
3.13 Benefit Plans; ERISA.
(a) All Benefit Plans (as defined below) are listed in
Schedule 3.13, and copies of all documentation relating to such
Benefit Plans have been delivered or made available to Buyer
(including copies of written Benefit Plans, written descriptions
of oral Benefit Plans, summary plan descriptions, trust
agreements, the three most recent annual returns IRS Forms 5500
and IRS determination letters). Except as disclosed in Schedule
3.13 hereto:
(i) each Benefit Plan has at all times been
maintained and administered in all material respects in
accordance with its terms and with the requirements of all
applicable law, including ERISA (as defined below) and the Code,
and each Benefit Plan intended to qualify under Section 401(a) of
the Code has at all times since its adoption been so qualified,
and each trust which forms a part of any such plan has at all
times since its adoption been tax-exempt under Section 501(a) of
the Code whether or not waived;
(ii) no Benefit Plan has incurred any
"accumulated funding deficiency" within the meaning of Section
302 of ERISA or Section 412 of the Code;
(iii) no "reportable event" (within the meaning
of Section 4043 of ERISA) has occurred with respect to any
Benefit Plan or any Plan (as defined below) maintained by an
ERISA Affiliate (as defined below) since the effective date of
Section 4043;
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(iv) with respect to each Multiemployer Plan (as
defined below) (i) no withdrawal liability has been incurred by
Bryan or any ERISA Affiliate, and Bryan has no reason to believe
that any such liability will be incurred, prior to the Closing
Date, (ii) no such plan is in "reorganization" (within the
meaning of Section 4241 of ERISA), (iii) no notice has been
received that increased contributions may be required to avoid a
reduction in plan benefits or the imposition of an excise tax, or
that the plan is or may become "insolvent" (within the meaning of
Section 4241 of ERISA), and (iv) no proceedings have been
instituted by the Pension Benefit Guaranty Corporation against
the plan;
(v) no direct, contingent or secondary liability
has been incurred or is expected to be incurred by Bryan under
Title IV of ERISA to any party with respect to any Benefit Plan
or Multiemployer Plan presently or heretofore maintained or
contributed to by any ERISA Affiliate;
(vi) neither Bryan nor any ERISA Affiliate has
incurred any liability for any tax imposed under Section 4971
through 4980B of the Code or civil liability under Section 502(i)
or (1) of ERISA;
(vii) no benefit under any Benefit Plan (except
as may be set forth in the Senior Management Agreements as
defined in Section 6.05(a)), including, without limitation, any
severance or parachute payment plan or agreement, will increase
the amount of compensation due any employee or will be
established or become accelerated, vested or payable by reason of
any transaction contemplated under this Agreement;
(viii) no tax has been incurred under Section 511
of the Code with respect to any Benefit Plan (or trust or other
funding vehicle pursuant thereto);
(ix) no Benefit Plan provides health or death
benefit coverage beyond the termination of an employee's
employment, except as required by Part 6 of Subtitle B of Title I
of ERISA or Section 4980B of the Code or any State laws requiring
continuation of benefits coverage following termination of
employment and there has been no communication to any employee
that would reasonably be expected to promise or guarantee any
such employee retiree health or life insurance or other retiree
death benefits on a permanent basis;
(x) no suit, actions or other litigation
(excluding claims for benefits incurred in the ordinary course of
plan activities) have been brought or, to the knowledge of Bryan,
threatened against or with respect to any Benefit Plan and there
are no facts or circumstances known to Bryan that could
reasonably be expected to give rise to any such suit, action or
other litigation; and
(xi) all contributions to Benefit Plans and
Multiemployer Plans that were required to be made under such
Benefit Plans as of the Closing Date have been made, and all
benefits accrued under any unfunded Benefit Plan have been paid,
accrued or otherwise adequately reserved in accordance with GAAP,
all of which accruals under unfunded Benefit Plans are as
reflected in Bryan SEC Reports or disclosed in Schedule 3.13, and
Bryan has performed all material obligations required to be
performed under all Benefit Plans.
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(b) Except as set forth in Schedule 3.13 hereto or as
provided in Section 6.05, neither the execution and delivery of
this Agreement nor the consummation of the transaction
contemplated hereby will entitle any former or current employee
of Bryan or any Affiliate or any group of such employees to any
payment, increase the amount of compensation due to any such
employees or cause acceleration of benefits under any Benefit
Plan.
(c) As used herein:
(i) "Benefit Plan" means any Plan, existing at
the Closing Date or prior thereto, established or to which
contributions have at any time been made by Bryan or its
Subsidiaries, or under which any employee, former employee or
director of Bryan or its Subsidiaries or any beneficiary thereof
is covered, is eligible for coverage or has benefit rights.
(ii) "ERISA" means the Employee Retirement Income
Security Act of 1974, as amended, and the rules and regulations
promulgated thereunder.
(iii) "ERISA Affiliate" means any business entity
which is, or at any time was, a member of a controlled group
(within the meaning of Section 412(n)(6) of the Code) that
includes, or at any time included, Bryan or its Subsidiaries.
(iv) "Multiemployer Plan" means a multiemployer
plan within the meaning of Section 4001(a)(3) of ERISA with
respect to which Bryan or any ERISA Affiliate has an obligation
to contribute or has or could have withdrawal liability under
Section 4201 of ERISA.
(v) "Plan" means any employment, consulting,
termination, bonus, incentive compensation, deferred
compensation, pension, profit sharing, retirement stock purchase,
stock option, stock ownership, stock appreciation rights, phantom
stock, savings, leave of absence, layoff, vacation, day or
dependent care, legal services, cafeteria, life, health,
accident, disability, workmen's compensation or other insurance,
severance, separation or other employee benefit plan, practice,
policy, agreement or arrangement of any kind, whether written or
oral, or whether for the benefit of a single individual or more
than one individual including, but not limited to, any "employee
benefit plan" within the meaning of Section 3(3) of ERISA.
3.14 Insurance. Schedule 3.14 identifies all insurance
policies of Bryan and its Subsidiaries currently in force,
inclusive of the name and address of the insurer, the policy
number and the year or years of coverage (the "Insurance
Policies"). To the best of Bryan's knowledge, Schedule 3.14 lists
all claims made against or under the Insurance Policies and under
any prior insurance policies in effect at any time during the
past five years with respect to Bryan, Wendland and Memco,
including claims related to product liability, third-party
property damage, bodily injury and third-party environmental
impairment. To the best of the knowledge of Bryan, Schedule 3.14
also identifies all insurance policies of Bryan under which
asbestos-related claims against Bryan are or would be covered.
Wendland will promptly (and in any event within 10 days from the
date hereof) reinstate product liability insurance coverage with
a scope equivalent to that under the product liability insurance
policy of Wendland most recently expired, and Wendland will
promptly deliver to Buyer reasonable evidence of such
reinstatement.
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3.15 Labor Matters.
(a) Except as set forth in Schedule 3.15, (i) no
employees of Bryan or any of its Subsidiaries are represented by
a labor union or organization, no labor union or organization has
been certified or recognized as a representative of any such
employees, and neither Bryan nor any of its Subsidiaries is a
party to or has any obligation under any collective bargaining
agreement or other labor union contract with any labor union or
organization, or has any obligation to recognize or deal with any
labor union or organization, and there are no such contracts
pertaining to or which determine the terms or conditions of
employment of any employee of Bryan or any of its Subsidiaries;
(ii) there are no pending or threatened representation campaigns,
elections or proceedings or questions concerning union
representation involving any employees of Bryan or any of its
Subsidiaries; (iii) neither Bryan nor any of its Subsidiaries has
any knowledge of any activities or efforts of any labor union or
organization (or representatives thereof) to organize any
employees of Bryan or any of its Subsidiaries, nor of any demands
for recognition or collective bargaining, nor of any strikes,
slowdowns, work stoppages or lock-outs of any kind, or threats
thereof, by or with respect to any employees of Bryan or any of
its Subsidiaries or any actual or claimed representatives
thereof, and no such activities, efforts, demands, strikes,
slowdowns, work stoppages or lock-outs occurred during the
48-month period preceding the date hereof; (iv) neither Bryan nor
any of its Subsidiaries has engaged in, admitted committing or
been held in any administrative or judicial proceeding to have
committed any unfair labor practice under the National Labor
Relations Act, as amended; (v) neither Bryan nor any of its
Subsidiaries is involved in any industrial or trade dispute or
any dispute or negotiations regarding a claim of material
importance with any labor union or organization; and (vi) there
are no controversies, claims, demands or grievances of material
importance pending or, so far as Bryan or any of its Subsidiaries
is aware, threatened, between Bryan or any of its Subsidiaries
and any of their respective employees or any actual or claimed
representative thereof.
(b) Schedule 3.15 (and the exhibits thereto) set forth
all contracts and agreements, including, without limitation,
employment agreements, consulting agreements, change in control
agreements, independent contractor agreements, retainers and
severance agreements under which Bryan or any of its Subsidiaries
has any obligation to provide wages, salary, commissions or other
compensation or remuneration (other than obligations to make
current wage or salary payments terminable at will without
notice) to or on behalf of any employee, former employee,
consultant or contractor (or any designee, assignee or
beneficiary thereof). A complete and correct copy of each written
(and a complete and correct written description of each such
oral) contract or agreement, has been delivered or made available
to Buyer.
(c) A true and correct statement of the names, current
rates of base compensation and description of the formula for
computing bonus compensation of all officers, directors and
salaried non-union employees of Bryan and its Subsidiaries as of
the date hereof, is set forth in Schedule 3.15. Except as set
forth in Schedule 3.15, (i) Bryan and its Subsidiaries have no
obligation (including an obligation for the payment of any fee,
extraordinary bonus or "golden parachute" based upon the
successful completion of the transactions contemplated hereunder)
under any employment contract, severance agreement or other
change in control plan, agreement or arrangement, or any other
similar agreements, employment policies (including vacation and
severance pay policies) or retirement or employee benefit plans,
arrangements or
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understandings, written or otherwise, with any officer, director,
employee or agent of Bryan or any Subsidiary and (ii) since
January 1, 1998, Bryan and its Subsidiaries have (A) not paid or
agreed to pay any bonuses or made or agreed to make any increase
in the rate of wages, salaries or other compensation or
remuneration of any of its officers, directors, consultants or
employees (except for increases in accordance with written
binding commitments, true, correct and complete copies of which
have been previously delivered to Buyer, or in accordance with a
past practice described in Schedule 3.15), or (B) become a party
to any employment contract or arrangement with any of its
officers or employees providing for any new or additional
bonuses, profit sharing payments, severance pay or retirement
benefits or any other form of employee compensation or benefits.
(d) Bryan and each of its Subsidiaries has at all
times complied in all material respects and is in material
compliance with all applicable federal, state and local laws,
rules and regulations respecting employment, wages, hours,
occupational health and safety, and payment and withholding of
taxes in connection with employment. Except as set forth in
Schedule 3.15, there are no claims, complaints or legal or
administrative proceedings pending or, so far as Bryan is aware,
threatened, against Bryan or any of its Subsidiaries before any
federal, state or municipal court or governmental agency, or any
federal, state or municipal taxing authority involving or
relating to any past or present employee(s) or applicant(s) for
employment of Bryan or any of its Subsidiaries, or relating to
any acts, omissions or practices of Bryan or any of its
Subsidiaries relating to employment practices or occupational
health and safety. Neither Bryan nor any of its Subsidiaries are
party to or bound by any court or administrative order, judgment,
decree or ruling of any kind respecting the employment practices
or occupational health and safety of any employees or prospective
employees of Bryan or any of its Subsidiaries.
3.16 Environmental Matters. Except as disclosed in
Schedule 3.16 hereto:
(a) To the best of Bryan's knowledge, Bryan and its
Subsidiaries are and have been consistently in compliance with
applicable Environmental Law (as defined below) and have obtained
all licenses, permits, authorizations, approvals and consents
from Governmental and Regulatory Authorities that are required in
respect of the business, operations, assets or properties of each
under any applicable Environmental Law. Bryan and its
Subsidiaries are in material compliance with the terms and
conditions of all such licenses, permits, authorizations,
approvals and consents.
(b) No Order or notice has been issued, no demand or
claim (including any for personal injury, property or natural
resources damage) has been asserted, no complaint has been filed,
no penalty has been assessed and no investigation or review is
pending or, to the knowledge of Bryan and its Subsidiaries,
threatened by any third party (including any Governmental or
Regulatory Authority) with respect to any alleged failure by
Bryan or any of its Subsidiaries to comply with applicable
Environmental Law or to have any license, permit, authorization,
approval or consent from Governmental or Regulatory Authorities
required under any applicable Environmental Law in connection
with the conduct of the business or operations of Bryan or any of
its Subsidiaries or with respect to any treatment, storage,
recycling, transportation, disposal or "release" as defined in 42
U.S.C. ss. 9601(22) ("Release"), of any Hazardous Material (as
defined below).
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(c) Bryan and its Subsidiaries have not handled any
Hazardous Material on any property owned or leased by Bryan or
any of its Subsidiaries; and, without limiting the foregoing, at
any property owned or leased by Bryan or any of its Subsidiaries,
(i) there are no underground storage tanks, active or abandoned;
(ii) no Hazardous Material has been Released in a quantity
reportable under, or in violation of, any Environmental Law;
(iii) no interim status or hazardous waste permit is or has been
required; and (iv) there has been no disposal of any Hazardous
Material.
(d) Bryan and its Subsidiaries have not transported or
arranged for the transportation of any Hazardous Material to any
location that, to the knowledge of Bryan and its Subsidiaries, is
not consistently in compliance with applicable Environmental Law
or which is the subject of any investigation, action, suit,
arbitration or proceeding that could be reasonably expected to
lead to claims against Bryan or any of its Subsidiaries for
clean-up costs, remedial work, damages to natural resources or
personal injury claims, which could be reasonably expected to
have a material adverse impact on Bryan or any of its
Subsidiaries including, but not limited to, claims under the
Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended, and the rules and regulations
promulgated thereunder ("CERCLA").
(e) No oral or written notification of a Release of a
Hazardous Material has been or was required to be filed by or on
behalf of Bryan or any of its Subsidiaries and no property owned
or leased by Bryan or any of its Subsidiaries is listed or
proposed for listing on the National Priorities List promulgated
pursuant to CERCLA or on any similar state list of sites
requiring investigation or clean-up.
(f) There are no Liens arising under or pursuant to
any Environmental Law with respect to any real property owned or
leased by Bryan or any of its Subsidiaries, and no action of any
Governmental or Regulatory Authority has been taken or is in
process which could subject any of such properties to such Liens,
and Bryan or any of its Subsidiaries would not be required to
place any notice or restriction relating to the presence of
Hazardous Material at any such property owned by it in any deed
to such property.
(g) Bryan has delivered, or made available, to Buyer
all environmental (including asbestos) investigations, studies,
audits, tests, reviews or other analyses conducted during the
prior three years by, or which are in the possession of, Bryan in
relation to any property or facility owned or leased by Bryan or
any of its Subsidiaries, including Phase 1 environmental reports
for all properties owned, leased or controlled, indirectly or
directly, by Bryan or any of its Subsidiaries.
As used herein:
(x) "Environmental Law" means any Law or Order
relating to human health, safety or protection of the environment
or to emissions, discharges, releases or threatened releases of
pollutants, contaminants or Hazardous Materials in the
environment (including, without limitation, ambient air, surface
water, ground water, land surface or subsurface strata), or
otherwise relating to the treatment, storage, disposal,
transport, use or handling of any Hazardous Material; and
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(y) "Hazardous Material" means (A) any chemicals,
materials, substances or wastes which are now or hereafter become
defined as or included in the definition of "hazardous
substances," "hazardous wastes," "hazardous materials,"
"extremely hazardous wastes," "restricted hazardous wastes,"
"toxic substances," "toxic pollutants," "pollutants,"
"contaminants" or words of similar import, under any
Environmental Law; and (B) any petroleum or petroleum products,
radioactive materials, asbestos in any form that is or could
become friable, and polychlorinated biphenyls (PCBs).
3.17 Tangible Property and Assets. Except as disclosed in
Schedule 3.17 hereto, Bryan has good and marketable title to, or
has valid leasehold interests in or valid rights under contract
to use, all tangible property and assets used in and,
individually or in the aggregate, material to the conduct of the
businesses of Bryan free and clear of all Liens other than (i)
any statutory Lien arising in the ordinary course of business by
operation of law with respect to a liability that is not yet due
or delinquent and (ii) any minor imperfection of title or similar
Lien which individually or in the aggregate with other such Liens
does not materially impair the value of the property or asset
subject to such Lien or the use of such property or asset in the
conduct of the business of Bryan. All such property and assets
are, in all material respects, in good working order and
condition, ordinary wear and tear excepted, and adequate and
suitable for the purposes for which they are presently being
used.
3.18 Intellectual Property Rights. Schedule 3.18 sets forth
a true, correct and complete list of all Intellectual Property
(as defined below) owned or held by Bryan or any of its
Subsidiaries (or otherwise used in the business of Bryan and its
Subsidiaries) on the date hereof and all license agreements
(including all amendments or supplements thereto or continuing
thereunder) in effect on the date hereof pursuant to which any
such Intellectual Property is licensed to or by Bryan or its
Subsidiaries, in each case, which have been, are, or may
reasonably be expected in the future to be, material to Bryan and
its Subsidiaries taken as a whole. Except as set forth in
Schedule 3.18, Bryan and its Subsidiaries own all right, title
and interest in and to all Intellectual Property used in their
respective businesses (other than Intellectual Property which,
individually or in the aggregate, is not material to the conduct
of the businesses of Bryan and its Subsidiaries), free and clear
of any royalty or other payment obligation, lien or charge. Bryan
and its Subsidiaries are not in default (and with the giving of
notice or lapse of time or both, would not be in default) in any
material respect under any license to use any Intellectual
Property. The Intellectual Property is not being infringed by any
third party, and Bryan is not infringing any intellectual
property rights of any third party, except for such defaults and
infringements which, individually or in the aggregate, are not
having and could not be reasonably expected to have a material
adverse effect on Bryan. Except as indicated in Schedule 3.18,
all maintenance taxes, annuities and renewal fees have been paid
and all other necessary actions to maintain the Intellectual
Property have been taken through the date hereof and will
continue to be paid or taken by Bryan and its Subsidiaries
through the Effective Time. To the best of Bryan's knowledge, no
claims or controversies currently exist regarding any
infringement of or by or violation of or by any of the
Intellectual Property. For purposes of this Agreement,
"Intellectual Property" includes
(i) all trademarks, service marks, trademark
registrations, service mark registrations, trade
names and applications for registration of
trademarks and service marks;
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(ii) all licenses which create rights in or to the
trademark, service mark or trade name properties
described in clause (i) above;
(iii) all copyrights, copyright registrations and
applications for registration of copyrights;
(iv) all renewals, modifications and extensions of any
items referred to in clauses (i) through (iii)
above;
(v) all patents, design patents and utility patents,
all applications for grant of any such patents
pending as of the date hereof or as of the
Effective Time or filed within five years prior to
the date hereof, and all reissues, divisions,
continuations-in-part and extensions thereof;
(vi) all technical documentation, trade secrets,
designs, inventions, processes, formula, know-how,
operating manuals and guides, plans, new product
development, technical and marketing surveys,
material specifications, product specifications,
invention records, research records, labor
routings, inspection processes, equipment lists,
engineering reports and drawing, architectural or
engineering plans, know-how agreements and other
know- how;
(vii) all marketing and licensing records, sales
literature, customer lists, trade lists, sales
forces and distributor networks lists, advertising
and promotional materials, service and parts
records, warranty records, maintenance records and
similar records;
(viii) all rights arising under, and rights to develop,
use and sell under, any of the foregoing and all
licenses with respect thereto; and
(ix) all rights and incidents of interest in and to all
non-competition or confidentiality agreements.
3.19 Vote Required. The affirmative vote of the holders of
record of at least two-thirds of the outstanding shares of Bryan
Common Stock with respect to the adoption of this Agreement is
the only vote of the holders of any class or series of the
capital stock of Bryan required to adopt this Agreement and
approve the Merger and the other transactions contemplated
hereby.
3.20 Disclosure. The information heretofore delivered or
made available by Bryan with respect to Bryan and its
Subsidiaries, when such information is taken as a whole, does not
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 circumstances under which they were made, not
misleading.
3.21 Effect of Transactions on Manufacturer's
Representatives and Customers. Except as listed on Schedule 3.21,
to the best of the knowledge of Bryan, the execution and delivery
of this Agreement and the consummation of the transactions
contemplated hereby (a) will not
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adversely affect the relationship of Bryan with any of its
manufacturer's representatives or customers, (b) will not
adversely affect the relationship of Bryan with any of its
suppliers, and (c) will not result in any breach or default, or
trigger any "change in control" provision, under any material
Contract.
3.22 Bryan's Transaction Costs. To the best of the
knowledge of Bryan, Schedule 3.22 sets forth an accurate estimate
of Bryan's Transaction Costs (as defined in Section 6.06) through
consummation of the Merger, and Bryan has furnished Buyer with
true and complete copies of all currently-existing agreements
(and written summaries of all currently-existing oral agreements)
under which Bryan's Transaction Costs are likely to become
payable. After the date hereof, neither Bryan nor any of its
subsidiaries will materially amend any such agreement, or enter
into any new such agreement, without the prior approval of Buyer
(such approval not to be unreasonably withheld).
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER AND MERGER SUB
Buyer and Merger Sub represent and warrant to Bryan as
follows:
4.01 Organization and Qualification. Each of Buyer and
Merger Sub is a corporation duly organized, validly existing and
in good standing under the laws of its jurisdiction of
incorporation. Merger Sub was formed solely for the purpose of
engaging in the transactions contemplated by this Agreement, has
engaged in no other business activities and has conducted its
operations only as contemplated hereby. Each of Buyer and Merger
Sub is duly qualified, licensed or admitted to do business and is
in good standing in each jurisdiction in which the ownership, use
or leasing of its assets and properties, or the conduct or nature
of its business, makes such qualification, licensing or admission
necessary, except for such failures to be so qualified, licensed
or admitted and in good standing which, individually or in the
aggregate, could not be reasonably expected to have a material
adverse effect on the validity or enforceability of this
Agreement or on the ability of Buyer or Merger Sub to perform its
obligations hereunder.
4.02 Authority Relative to this Agreement. Each of Buyer
and Merger Sub has full corporate power and authority to enter
into this Agreement, and to perform its obligations hereunder and
to consummate the transactions contemplated hereby. The
execution, delivery and performance of this Agreement by each of
Buyer and Merger Sub and the consummation by each of Buyer and
Merger Sub of the transactions contemplated hereby have been duly
and validly approved by their respective Boards of Directors and
by Buyer in its capacity as the sole shareholder of Merger Sub
and no other corporate proceedings on the part of Buyer, Merger
Sub or their shareholders are necessary to authorize the
execution, delivery and performance of this Agreement by Buyer or
Merger Sub and the consummation by Buyer or Merger Sub of the
transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by Buyer and Merger Sub and
constitutes a legal, valid and binding obligation of Buyer and
Merger Sub enforceable against Buyer and Merger Sub in accordance
with its terms, except as such enforceability may be limited by
applicable bankruptcy, insolvency,
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reorganization, moratorium or other similar laws affecting the
enforcement of creditors' rights generally and by general
equitable principles (regardless of whether such enforceability
is considered in a proceeding in equity or at law).
4.03 Non-Contravention; Approvals and Consents.
(a) The execution and delivery of this Agreement by
Buyer and Merger Sub does not and the performance by Buyer and
Merger Sub of their obligations hereunder and the consummation of
the transactions contemplated hereby will not, conflict with,
result in a violation or breach of, constitute (with or without
notice or lapse of time or both) a default under, result in or
give to any person any right of termination, cancellation,
modification or acceleration of, or result in the creation or
imposition of any Lien upon any of the assets or properties of
Buyer, or any of its Subsidiaries, under any of the terms,
conditions or provisions of (i) the certificates or articles of
incorporation or By-laws (or other comparable charter documents)
of Buyer or any of its Subsidiaries, or (ii) subject to the
taking of the actions described in paragraph (b) of this Section,
(x) any Law or Order of any Governmental or Regulatory Authority
applicable to Buyer or any of its Subsidiaries or any of their
respective assets or properties, or (y) any Contract to which
Buyer or any of its Subsidiaries is a party or by which Buyer or
any of its Subsidiaries or any of their respective assets or
properties is bound, excluding from the foregoing clauses (x) and
(y) conflicts, violations, breaches, defaults, terminations,
modifications, accelerations and creations and impositions of
Liens which, individually or in the aggregate, could not be
reasonably expected to have a material adverse effect on the
ability of Buyer and Merger Sub to consummate the transactions
contemplated by this Agreement.
(b) Except (i) for the filing of a premerger
notification report by Buyer under the HSR Act, (ii) for the
filing of the Articles of Merger required by the NMBCA with the
New Mexico Corporation Commission and appropriate documents with
the relevant authorities of other states in which the Constituent
Corporations are qualified to do business, and (iii) for the
filing of Schedule 14D-1 and Schedule 14D-9, no consent approval
or action of, filing with or notice to any Governmental or
Regulatory Authority or other public or private third party is
necessary or required under any of the terms, conditions or
provisions of any Law or Order of any Governmental or Regulatory
Authority or any Contract to which Buyer or any of its
Subsidiaries is a party or by which Buyer or any of its
Subsidiaries or any of their respective assets or properties is
bound by the execution and delivery of this Agreement by Buyer
and Merger Sub, the performance by Buyer and Merger Sub of their
obligations hereunder or the consummation of the transactions
contemplated hereby, other than such consents, approvals,
actions, filings and notices which the failure to make or obtain,
as the case may be, individually or in the aggregate, could not
be reasonably expected to have a material adverse effect on the
ability of Buyer and Merger Sub to consummate the transactions
contemplated by this Agreement.
4.04 Legal Proceedings. There are no actions, suits,
arbitrations or proceedings pending or, to the knowledge of Buyer
and its Subsidiaries, threatened against, relating to or
affecting, nor to the knowledge of Buyer and its Subsidiaries are
there any Governmental or Regulatory Authority investigations or
audits pending or threatened against, relating to or affecting,
Buyer or any of its Subsidiaries or any of their respective
assets and properties which, if determined adversely to Buyer or
any of its Subsidiaries, individually or in the aggregate,
26
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could be reasonably expected to have a material adverse effect on
the ability of Buyer and Merger Sub to consummate the
transactions contemplated by this Agreement. Neither Buyer nor
any of its Subsidiaries is subject to any Order of any
Governmental or Regulatory Authority which, individually or in
the aggregate, could be reasonably expected to have a material
adverse effect on the ability of Buyer and Merger Sub to
consummate the transactions contemplated by this Agreement.
4.05 Information Supplied.
(a) None of the Offer Documents will, at the times such
documents are filed with the SEC and are mailed to the
stockholders of Bryan, contain any untrue statement of a material
fact or omit to state a material fact required to be stated
therein or necessary in order to make the statements made
therein, in light of the circumstances under which they are made,
not misleading, except that no representation is made by Buyer or
Merger Sub with respect to information supplied in writing by
Bryan or an affiliate of Bryan expressly for inclusion therein.
The Offer Documents will comply as to form in all material
respects with the provisions of the Exchange Act and the rules
and regulations of the SEC thereunder.
(b) None of the information supplied by Buyer, Merger Sub
or any affiliate of Buyer or Merger Sub specifically for
inclusion in the Proxy Statement or the Schedule 14D-9 will, at
the date of filing with the SEC, and, in the case of the Proxy
Statement, at the time the Proxy Statement is mailed and at the
time of the Special Meeting, contain any untrue statement of a
material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were
made, not misleading.
(c) Neither the information supplied or to be supplied in
writing by or on behalf of Buyer or Merger Sub for inclusion, nor
the information incorporated by reference from documents filed by
Buyer or any of its Subsidiaries with the SEC, in the Proxy
Statement or any other documents to be filed by Buyer, Merger Sub
or Bryan with the SEC or any other Governmental or Regulatory
Authority in connection with the Merger and the other
transactions contemplated hereby will on the date of its filing
or, in the case of the Proxy Statement, at the date it is mailed
to shareholders, and at the time of the Shareholder Meeting,
contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in
order to make the statements therein, in light of the
circumstances under which they are made, not misleading. All such
documents filed by Buyer or Merger Sub with the SEC under the
Exchange Act will comply as to form in all material respects with
the requirements of the Exchange Act.
4.06 Financing. Buyer has sufficient cash and/or credit
facilities on hand or immediately available to consummate the
Offer and the Merger in accordance with this Agreement and to
make all other necessary payments of fees and expenses in
connection with the transactions contemplated by this Agreement.
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ARTICLE V
COVENANTS OF THE COMPANY
5.01 Conduct of Business. At all times from and after the
date hereof until the Effective Time, Bryan covenants and agrees
that (except as expressly contemplated or permitted by this
Agreement, or to the extent that Buyer may otherwise grant prior
consent in writing, which consent shall not be unreasonably
withheld):
(a) Bryan shall conduct its business only in, and
Bryan shall cause its Subsidiaries not to take any action except
in, the ordinary course consistent with past practice (subject to
the further limitations specified in this Article).
(b) Without limiting the generality of paragraph (a)
of this Section, Bryan shall, and shall cause its Subsidiaries
to, use all commercially reasonable efforts to preserve intact in
all material respects its present business organization and
reputation, to keep available the services of its key officers
and employees, to maintain its assets and properties in good
working order and condition (ordinary wear and tear excepted), to
preserve its relationships with customers and suppliers and
others having significant business dealings with them, to comply
in all material respects with all Laws and Orders of all
Governmental or Regulatory Authorities applicable to them, and to
maintain (subject to Section 5.01(b)(xx)) insurance, including,
without limitation, product liability insurance, in such amounts
and against such risks and losses as was in effect on June 30,
1998 (subject to Section 3.14). Also without limiting the
generality of paragraph (a) of this Section, Bryan shall not, and
shall cause its Subsidiaries not to:
(i) amend or propose to amend its or their Articles of
Incorporation or By-laws;
(ii) (w) declare, set aside or pay any dividends on or
make other distributions in respect of any of its capital
stock other than the dividend of $2.00 per share declared
on Bryan Common Stock on August 26, 1998 and payable on
September 15, 1998; (x) split, combine, reclassify or take
similar action with respect to any of its capital stock or
issue or authorize or propose the issuance of any other
securities or Option in respect of, in lieu of or in
substitution for shares of its capital stock, (y) adopt a
plan of complete or partial liquidation or resolutions
providing for or authorizing such liquidation or a
dissolution, merger, consolidation, restructuring,
recapitalization or other reorganization or (z) directly or
indirectly redeem, repurchase or otherwise acquire any
shares of its capital stock or any Option with respect
thereto;
(iii) issue, deliver or sell, or authorize or propose
the issuance, delivery or sale of, any shares of its
capital stock or any Option with respect thereto, or modify
or amend any right of any holder of outstanding shares of
capital stock or Options with respect thereto;
(iv) acquire (by merging or consolidating with, or by
purchasing a substantial equity interest in or a
substantial portion of the assets of, or by any other
manner) any business or any corporation, partnership,
association or other business
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organization or division thereof or otherwise acquire or
agree to acquire any assets other than raw materials and
supplies acquired in the ordinary course of its business
consistent with past practice in amounts in any one
instance (or group of related instances) not in excess of
$250,000 and in each case pursuant to an order or agreement
requiring delivery of such raw materials and supplies
within 120 days after the creation of such order or
agreement;
(v) sell, lease, grant any security interest in or
otherwise dispose of or encumber any of its assets or
properties other than finished goods in the ordinary course
of business consistent with past practice pursuant to
orders as to which (x) no one order (or group of related
orders) involves an aggregate selling price in excess of
$150,000, and (y)(i) each order is to be fully performed
within 150 days after its creation or (ii) in the case of
orders for which there is no definite date by which the
orders must be fully performed, the aggregate selling price
for all such orders that are more than 150 days old shall
not exceed $500,000;
(vi) except to the extent required by applicable law
or GAAP, (x) permit any material change in (A) any pricing,
marketing, purchasing, investment, accounting, financial
reporting, inventory, receivable, credit, allowance or tax
practice or policy or (B) any method of calculating any bad
debt, contingency or other reserve for accounting,
financial reporting or tax purposes or (y) make any
material tax election or settle or compromise any material
income tax liability with any Governmental or Regulatory
Authority;
(vii) (x) other than working capital borrowings of up
to $300,000 under Bryan's existing bank line of credit,
incur any indebtedness for borrowed money (which shall be
deemed for this purpose to include entering into credit
agreements, lines of credit or similar arrangements,
whether or not amounts are borrowed thereunder) or
guarantee any such indebtedness, or (y) voluntarily
purchase, cancel, prepay or otherwise provide for a
complete or partial discharge in advance of a scheduled
repayment date with respect to, or waive any right under,
any indebtedness for borrowed money;
(viii) (x) enter into, adopt, amend in any material
respect (except as may be required by applicable law) or
terminate any Bryan Benefit Plan or other agreement between
Bryan (or any of its Subsidiaries) and one or more of its
directors, officers or employees, or (y) increase in any
manner the compensation or fringe benefits of any director,
officer or employee or pay any benefit not required by any
plan or arrangement in effect as of the date hereof (except
that Bryan shall comply with the union contract and except
for normal increases approved by Buyer);
(ix) enter into any new Contract or amend, modify or
terminate any existing Contract, or engage in any new
transaction (x) not in the ordinary course of business
consistent with past practice, (y) not on an arm's length
basis, or (z) with any shareholder or affiliate of Bryan;
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(x) make any capital expenditure or any commitment to
make a capital expenditure or any commitment for additions
to plant, property or equipment constituting capital
assets;
(xi) make any change in lines of business or any
material changes in prices, marketing plans or procedures;
(xii) make any changes to current levels of inventory,
receivables or payables, except as may occur in the
ordinary course of business consistent with past practice;
(xiii) grant any stock-related, performance or similar
awards or bonuses;
(xiv) forgive any loans to employees, officers or
directors or any of their respective affiliates or
associates;
(xv) make any deposits or contributions of cash or
other property to, or take any other action to fund or in
any other way secure the payment of compensation or
benefits under, any Bryan Benefit Plan;
(xvi) enter into, amend, extend or waive any rights
under any collective bargaining or other labor agreement;
(xvii) commence, settle or agree to settle any
litigation, suit, action, claim, proceeding or
investigation;
(xviii) pay, discharge or satisfy or agree to pay,
discharge or satisfy any claim, liability or obligation
(absolute accrued, asserted or unasserted, contingent or
otherwise) other than the payment, discharge or
satisfaction of liabilities reflected or reserved against
in full in the financial statements as at June 30, 1998 or
incurred in the ordinary course of business subsequent to
June 30, 1998 or Bryan's Transaction Costs;
(xix) enter into, modify, amend or terminate any
Contract material to the business of Bryan or any of its
Subsidiaries which it may enter, amend or terminate without
violating clause (ix) above, or waive any rights under any
such Contract, unless in each instance Bryan first obtains
the consent of Buyer, which consent shall not be
unreasonably withheld;
(xx) enter into or extend or renew any Contract
(including without limitation any insurance policy), which
Contract, extension or renewal has a term or is to be
performed over a period of more than 60 days (and before
renewing any insurance policy, Bryan shall reasonably
consult with Buyer); or
(xxi) enter into any contract, agreement, commitment
or arrangement to do or engage in any of the foregoing.
(c) Advice of Changes. Bryan shall confer on a regular
and frequent basis with Buyer with respect to its businesses and
operations and other matters relevant to the Merger,
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and shall promptly advise Buyer, in writing, of any change or
event, including, without limitation, any complaint,
investigation or hearing by any Governmental or Regulatory
Authority (or communication indicating the same may be
contemplated) or the institution or threat of litigation, having,
or which, insofar as can be reasonably foreseen, could have, a
material adverse effect on Bryan or on the ability of Bryan to
consummate the transactions contemplated hereby.
5.02 No Solicitations. (a) Bryan shall not, and it shall
not authorize or permit either of its Subsidiaries or any of its
or their officers, directors, employees, investment bankers,
financial advisors, attorneys, accountants or other agents or
representatives (each, a "Representative") to directly or
indirectly, solicit, initiate or participate in any negotiations
regarding, furnish any confidential information in connection
with, endorse or otherwise cooperate with, or assist, participate
in or facilitate (collectively, "Solicitation Activities") the
making of any proposal or offer for, or which may reasonably be
expected to lead to, a Potential Transaction (as defined below),
by any person, corporation, partnership or other entity or group,
including a current shareholder of Bryan Common Stock or a person
acting on behalf of or who has been in contact with such a
shareholder (a "Potential Acquiror"); provided, however, that to
the extent the Board of Directors of Bryan believes, on the basis
of a written opinion furnished by independent legal counsel, that
the failure to take any such actions would constitute a breach of
applicable fiduciary duties of such Board of Directors, then
Bryan and its Representatives may participate in Solicitation
Activities but only to the extent necessary to comply with such
duties; provided further, however, that such participation shall
only be in compliance with Section 5.02(b); provided further,
however, that nothing herein shall in any event prevent Bryan's
Board of Directors from taking and disclosing to Bryan's
shareholders a position contemplated by Rule 14D-9 and 14e-2
promulgated under the Exchange Act with respect to any tender
offer or from making such other disclosures to Bryan's
shareholders, which, in either case, based upon the advice of
independent legal counsel, the Board in its good faith judgment
determines is required by the fiduciary duties of the Board of
Directors under applicable law.
(b) Bryan shall promptly inform Buyer, in writing, of the
material terms and conditions of any proposal or offer for, or
which may reasonably be expected to lead to, a Potential
Transaction that it receives and the identity of the Potential
Acquiror and Bryan shall keep Buyer fully apprised of all
developments regarding such Potential Transaction. Such full
apprising of all developments shall include providing Buyer with
copies of all correspondence from or to Bryan and the Potential
Acquirer, including all attachments and enclosures.
(c) As of the date and time of this agreement Bryan and its
Representatives will immediately cease and cause to be terminated
any existing activities, discussions or negotiations with any
parties other than Burnham and Merger Sub conducted heretofore
with respect to any Potential Transaction.
(d) As used in this Agreement, "Potential Transaction"
means any potential merger, consolidation or other business
combination involving Bryan, or any acquisition in any manner of
all or a substantial portion of the equity of, or all or a
substantial portion of the assets of Bryan whether for cash,
securities or any other consideration or combination thereof
other than pursuant to the transactions contemplated by this
Agreement.
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ARTICLE VI
ADDITIONAL AGREEMENTS
6.01 Access to Information; Confidentiality.
(a) Bryan shall, throughout the period from the date
hereof to the Effective Time, (i) provide Buyer and its
Representatives with full access, upon reasonable prior notice
and during normal business hours, to all officers, employees,
agents and accountants of Bryan and its assets, properties, books
and records, and (ii) furnish promptly to such persons (x) a copy
of each report, statement, schedule and other document filed or
received by Bryan pursuant to the requirements of federal or
state securities or tax laws or filed with any other Governmental
or Regulatory Authority, and (y) all other information and data
(including, without limitation, copies of Contracts, Bryan
Benefit Plans and other books and records) concerning the
business and operations of Bryan or its Subsidiaries as Buyer or
its Representatives reasonably may request. No investigation
pursuant to this paragraph or otherwise shall affect any
representation or warranty contained in this Agreement or any
condition to the obligations of the parties hereto.
(b) Non-public information obtained by Buyer pursuant
to Section 6.01(a) shall be subject to the provisions of the
confidentiality agreement between Buyer and Bryan, dated June 18,
1998 (the "Confidentiality Agreement"), the terms of which are
incorporated herein by reference.
6.02 Preparation of Proxy Statement. Bryan shall prepare
and file with the SEC the Proxy Statement at the earliest
practicable date after the Offer has expired or terminated
(unless 90% or more of outstanding Bryan Common Stock is acquired
by Merger Sub pursuant to the Offer or Bryan Common Stock ceases
to be registered under the Exchange Act in accordance with
applicable law); and shall use all reasonable efforts to have the
Proxy Statement cleared by the SEC. If at any time prior to the
Effective Time any event shall occur that is required to be set
forth in an amendment of or a supplement to the Proxy Statement,
Bryan shall prepare and file with the SEC such amendment or
supplement as soon thereafter as is reasonably practicable.
Buyer, Merger Sub and Bryan shall cooperate with each other in
the preparation of the Proxy Statement, and Bryan shall promptly
notify Buyer of the receipt of any comments of the SEC with
respect to the Proxy Statement and of any requests by the SEC for
any amendment or supplement thereto or for additional
information, and shall promptly provide to Buyer copies of all
correspondence between Bryan or any representative of Bryan and
the SEC with respect to the Proxy Statement. Bryan shall give
Buyer and its counsel the opportunity to review the Proxy
Statement and all responses to requests for additional
information by and replies to comments of the SEC before their
being filed with, or sent to, the SEC. If the Proxy Statement is
required to be filed with the SEC, each of Bryan, Buyer and
Merger Sub agrees to use all reasonable efforts, after
consultation with the other parties hereto, to respond promptly
to all such comments of and requests by the SEC and to cause the
Proxy Statement to be mailed to the holders of Bryan Common Stock
entitled to vote at the Shareholder Meeting at the earliest
practicable time.
6.03 Approval of Shareholders. (a) To the extent required
by applicable law, Bryan shall, through its Board of Directors,
duly call, give notice of, convene and hold the Shareholder
Meeting for the purpose of voting on the adoption of this
Agreement (the "Shareholders'
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Approval") as soon as reasonably practicable after consummation
of the Offer but in any event prior to the 90th day after the
date hereof (subject to unavoidable delays in receiving comments
from the SEC staff or in considering and preparing responses to
such comments). Except to the extent legally required for the
discharge of its fiduciary duties as reflected in a written
opinion of independent legal counsel, Bryan shall, through its
Board of Directors, include in the Proxy Statement the
recommendation of the Board of Directors of Bryan that the
shareholders of Bryan adopt this Agreement and approve the
Merger, and shall use all reasonable efforts to obtain such
adoption and approval, including utilizing a proxy solicitation
firm that is reasonably acceptable to Buyer and obtaining the
opinion of McDonald & Company Securities, Inc. to the effect that
the Merger Price is fair to the holders of Bryan Common Stock
from a financial point of view. At such meeting, Buyer shall, and
shall cause its Subsidiaries to, cause all shares of Bryan Common
Stock, if any, then owned by Buyer or any such Subsidiary to be
voted in favor of the adoption of this Agreement.
(b) Not earlier than five days, and not later than three
days, prior to the day of the Shareholder Meeting (if such
Shareholder Meeting is required under applicable law), Bryan
shall provide a notice to Buyer stating the number of Bryan
Common Shares for which valid, executed proxies have been
received with directions to vote such shares in favor of the
Merger. Bryan shall thereupon promptly consult with Buyer and, if
after such consultation Buyer so requests, Bryan shall cause the
Shareholder Meeting to be adjourned for such period as Buyer
shall request not to exceed thirty (30) days (or postponed to
such date as Buyer shall request, which date shall not be more
than thirty (30) days after the original date of the meeting) to
allow the proxy solicitation firm to continue to solicit proxies
in favor of the Merger. In such event, Bryan shall cooperate with
Buyer and the proxy solicitation firm to attempt to obtain
proxies sufficient to result in approval of the Merger by the
shareholders of Bryan.
(c) In the event that the approval and adoption of this
Agreement and the Merger at the Shareholder Meeting or any
adjournment thereof receives the affirmative vote of less than
66- 2/3% of all shares entitled to vote for such approval, then
Buyer may in its sole discretion (but subject to Section
8.01(b)(ii)) require Bryan to, and Bryan shall be obligated to,
through its Board of Directors, duly call, give notice of,
convene and hold a second Shareholder Meeting for the purpose of
voting on the adoption of this Agreement. Such second Shareholder
Meeting shall be held as soon as reasonably practicable after the
date of the notice from Buyer to Bryan in which Buyer notifies
Bryan that Buyer desires Bryan to call a second Shareholder
Meeting. In the event Buyer determines a second Shareholder
Meeting is appropriate, then all other provisions in this
Agreement relating to the Shareholder Meeting shall be read
mutatis mutandis as applying to such second Shareholder Meeting.
(d) If Buyer shall directly or indirectly acquire at least
90 percent of the outstanding shares of Bryan Common Stock, each
of Buyer, Merger Sub and Bryan shall take all necessary and
appropriate action as Buyer may reasonably request to cause the
Merger to become effective as promptly as practicable after the
consummation of the Offer without a meeting of holders of Bryan
Common Stock in accordance with Section 53-14-5 of the NMBCA.
6.04 Regulatory and Other Approvals. Subject to the terms
and conditions of this Agreement and without limiting the
provisions of Sections 6.02 and 6.03, each of Bryan and Buyer
will proceed diligently and in good faith and will use all
commercially reasonable efforts
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to do, or cause to be done, all things necessary, proper or
advisable to, as promptly as practicable, (a) obtain all
consents, approvals or actions of, make all filings with and give
all notices to Governmental or Regulatory Authorities or any
other public or private third parties required of Buyer, Bryan or
any of their Subsidiaries to consummate the Merger and the other
matters contemplated hereby, and (b) provide such other
information and communications to such Governmental or Regulatory
Authorities or other public or private third parties as the other
party or such Governmental or Regulatory Authorities or other
public or private third parties may reasonably request. In
addition to and not in limitation of the foregoing, (i) each of
the parties will (x) take promptly all actions necessary to make
the filings required of Buyer and Bryan or their affiliates under
the HSR Act, (y) comply at the earliest practicable date with any
request for additional information received by such party or its
affiliates from the Federal Trade Commission (the "FTC") or the
Antitrust Division of the Department of Justice (the "Antitrust
Division") pursuant to the HSR Act, and (z) cooperate with the
other party in connection with such party's filings under the HSR
Act and in connection with resolving any investigation or other
inquiry concerning the Merger or the other matters contemplated
by this Agreement commenced by either the FTC or the Antitrust
Division or state attorneys general.
6.05 Employees.
(a) Buyer confirms that the Surviving Corporation will
honor in accordance with their respective provisions the existing
agreements between Bryan and each of Messrs. Bishop, McVay,
Holmquist, Krauskopf, Kubly, Minard, Mitting, McCune and Sturch
(collectively, "Senior Management Agreements"), copies of which
Bryan has heretofore delivered to Buyer. Further, Buyer confirms
that it will cause the Surviving Corporation to pay to each of
such persons the Transaction Bonus contemplated in the applicable
Senior Management Agreement, in the installments and at the times
specified therein, irrespective of whether the Merger is deemed
to have been supported or sponsored by management or any
management group.
(b) The Surviving Corporation will honor all existing
union contracts and all other existing agreements between Bryan
and its employees which have heretofore been disclosed to Buyer.
6.06 Expenses. Subject to Section 6.14 and to remedies in
respect of breach of the provisions hereof, if the Merger is not
consummated, all costs and expenses incurred in connection with
this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such cost or expense. If the Merger
is consummated, Bryan's Transaction Costs (as defined below)
shall be paid by Bryan, by the Surviving Corporation and/or by
Buyer without reduction of the per-share amount payable to Bryan
shareholders under Section 2.01(a)(iii). As used herein, "Bryan's
Transaction Costs" means all out-of-pocket costs reasonably
incurred by Bryan or any of its Subsidiaries on or after July 1,
1998 in connection with the potential and actual sale of Bryan
and its Subsidiaries, including without limitation (i) the fees
and expenses of McDonald & Company Securities, Inc., (ii) the
fees and expenses of Goelzer & Co. Inc., (iii) legal fees and
expenses, (iv) expenses for environmental reports, (v) expenses
for title reports, (vi) expenses for proxy solicitation and fees
and expenses of the Exchange Agent, and (viii) filing fees in
connection with compliance with securities and antitrust laws.
Bryan's Transaction Expenses shall not include (a) any amounts
payable or paid to senior managers of Bryan under the Senior
Management Agreements by virtue of the consummation of the Merger
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(Buyer having agreed separately to cause the Surviving
Corporation to pay such amounts in addition to all other
consideration for the Merger), or (b) any expenses incurred by
Buyer or Merger Sub with respect to the Offer.
6.07 Brokers or Finders. Each of Buyer and Bryan
represents, as to itself and its Affiliates, that no agent,
broker, investment banker, financial advisor or other firm or
person is or will be entitled to any broker's or finder's fee or
any other commission or similar fee in connection with any of the
transactions contemplated by this Agreement, except, in the case
of Bryan, for McDonald & Company Securities, Inc. and Goelzer &
Co., Inc. True and complete copies of Bryan's agreements with
such firms have been delivered by Bryan to Buyer prior to the
execution of this Agreement.
6.08 Notice and Cure. Each of Buyer and Bryan will notify
the other promptly in writing of, and contemporaneously will
provide the other with true and complete copies of any and all
information or documents relating to, and will use all
commercially reasonable efforts to cure before the Closing, any
event, transaction or circumstance occurring or not occurring
after the date of this Agreement that causes or will cause or is
likely to cause any covenant or agreement of Buyer or Bryan, as
the case may be, under this Agreement to be breached or that
renders or will render untrue (disregarding any limitations as to
materiality as may be contained therein) any representation or
warranty of Buyer or Bryan, as the case may be, contained in this
Agreement as if the same were made on or as of the date of such
event, transaction or circumstance. Each of Buyer and Bryan also
will notify the other promptly in writing of, and will use all
commercially reasonable efforts to cure before the Closing, any
violation or breach of any representation, warranty, covenant or
agreement made by Buyer or Bryan, as the case may be, in this
Agreement, whether occurring or arising prior to, on or after the
date of this Agreement. No notice given pursuant to this Section
shall have any effect on the representations, warranties,
covenants or agreements contained in this Agreement for purposes
of determining satisfaction of any condition contained herein and
such notice shall not limit or otherwise affect the remedies
available hereunder to the party receiving such notice.
6.09 Fulfillment of Conditions. Subject to the terms and
conditions of this Agreement, each of Buyer and Bryan will take
or cause to be taken all commercially reasonable steps necessary
or desirable and proceed diligently and in good faith to satisfy
each condition to the other's obligations contained in this
Agreement and to consummate and make effective the transactions
contemplated by this Agreement, and neither Buyer nor Bryan will,
nor will either permit any of its Subsidiaries to, take or fail
to take any action that could be reasonably expected to result in
the nonfulfillment of any such condition.
6.10 Indemnification; Directors' and Officers' Insurance.
(a) Until the fourth anniversary of the Effective Time
(and until resolution of any claims asserted prior to such fourth
anniversary), the Surviving Corporation shall, to the extent
allowed by law and to the extent currently provided in the
By-laws and Articles of Incorporation of Bryan, indemnify, defend
and hold harmless each person who is as of the date hereof, or
has been at any time prior to the date hereof, a director or
officer of Bryan or any of its Subsidiaries (the "Indemnified
Parties") against (i) all losses, claims, damages, costs,
expenses, liabilities or judgments or amounts that are paid in
settlement of or in connection with any claim,
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action, suit, proceeding or investigation based in whole or in
part on or arising in whole or in part out of the fact that such
person is or was a director or officer of Bryan or any Subsidiary
of Bryan, whether pertaining to any matter existing or occurring
at or prior to the Effective Time and whether asserted or claimed
prior to, or at or after, the Effective Time ("Indemnified
Liabilities") and (ii) all Indemnified Liabilities based in whole
or in part on, or arising in whole or in part out of, or
pertaining to this Agreement or the transactions contemplated
hereby, in each case to the full extent Bryan would have been
permitted under New Mexico law to indemnify such person (and
subject to the foregoing, the Surviving Corporation shall, in the
event the Surviving Corporation determines in its reasonable
discretion that such person would be entitled to indemnification
hereunder, pay expenses in advance of the final disposition of
any such action or proceeding to each Indemnified Party;
provided, however, that the person to whom the expenses are
advanced must provide an undertaking (without delivering a bond
or other security) to repay such advance if it is ultimately
determined that such person is not entitled to indemnification as
provided in Section 53-11-4.1 of the NMBCA). Without limiting the
foregoing, in the event any such claim, action, suit, proceeding
or investigation is brought against any Indemnified Parties
(whether arising before or after the Effective Time), (i) any
counsel retained by the Indemnified Parties for any period after
the Effective Time shall be reasonably satisfactory to the
Surviving Corporation; (ii) after the Effective Time, the
Surviving Corporation shall pay all reasonable fees and expenses
of such counsel for the Indemnified Parties promptly as
statements therefor are received as heretofore provided; and
(iii) after the Effective Time, the Surviving Corporation will
use all reasonable efforts to assist in the vigorous defense of
such matter, provided that the Surviving Corporation shall not be
liable for any settlement of any claim effected without its
written consent, which consent, however, shall not be
unreasonably withheld. Any Indemnified Party wishing to claim
indemnification under this Section 6.10, upon learning of any
such claim, action, suit, proceeding or investigation, shall
notify the Surviving Corporation (but the failure so to notify
the Surviving Corporation shall not relieve it from any liability
which it may have under this Section 6.10 except to the extent
such failure prejudices the Surviving Corporation), and shall
deliver to the Surviving Corporation the undertaking, if any,
required by the NMBCA or this Agreement. The Surviving
Corporation shall be liable for the fees and expenses hereunder
with respect to only one law firm, in addition to local counsel
in each applicable jurisdiction, to represent the Indemnified
Parties as a group with respect to each such matter unless there
is, under applicable standards of professional conduct, a
conflict between the positions of any two or more Indemnified
Parties that would preclude or render inadvisable joint or
multiple representation of such parties.
(b) For a period of four years after the Effective
Time, the Surviving Corporation shall cause to be maintained in
effect the current policies of directors' and officers' liability
insurance maintained by Bryan (provided that the Surviving
Corporation may substitute therefor other policies of at least
the same coverage and amounts containing terms and conditions
which are no less advantageous) with respect to claims arising
from facts or events which occurred before or at the Effective
Time; provided, however, that the Surviving Corporation shall not
be obligated to make annual premium payments for such insurance
to the extent such premiums exceed 125% of the premiums paid as
of the date hereof by Bryan for such insurance ("Bryan's Current
Premium"), and if such premiums for such insurance would at any
time exceed 125% of Bryan's Current Premium, then the Surviving
Corporation shall cause to be maintained policies of insurance
which, in the Surviving Corporation's good faith determination,
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provided the maximum coverage available at an annual premium
equal to 125% of Bryan's Current Premium. Notwithstanding
anything to the contrary contained elsewhere herein, the
Surviving Corporation's indemnity agreement set forth above in
Section 6.10(a) shall be limited to cover claims only to the
extent that those claims are not covered under Bryan's current
directors' and officers' insurance policies and the continuation
or maintenance thereof as required by this Section 6.10(b) (or
any substitute policies permitted by this Section 6.10(b)).
(c) In the event Buyer or any of its 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, proper
provision shall be made so that the successors and assigns of
Buyer assume the obligations set forth in this section.
(d) The provisions of this Section 6.10 (i) are
intended to be for the benefit of, and shall be enforceable by,
each Indemnified Party, his heirs and his representatives and
(ii) are in addition to, and not in substitution for, any other
rights to indemnification or contribution that any such person
may have by contract or otherwise.
6.11 Retention of Bryan Name. Until the 10th anniversary of
the Closing Date, Buyer shall cause the name of the Surviving
Corporation to continue to be "Bryan Steam Corporation", unless,
due to a change in circumstances after the Closing, such
continuation shall be, in the opinion of the Board of Directors
of the Surviving Corporation at any time, materially adverse to
Buyer or the Surviving Corporation.
6.12 Takeover Laws. Bryan shall, upon the request of Buyer,
take all reasonable steps to exclude the applicability of, or to
assist in any challenge by Buyer or the Merger Sub of the
validity or applicability to the Merger of, any Takeover Laws. As
used herein, "Takeover Laws" shall mean any "moratorium",
"control share acquisition", "business combination", "fair price"
or other form of antitakeover laws and regulations of any
jurisdiction that may purport to be applicable to this Agreement
or the Merger.
6.13 Subsequent Financial Statements. Until the Effective
Time, Bryan will timely file with the SEC each form, report and
document required to be filed by Bryan under the Exchange Act and
will promptly deliver to Buyer copies of each such report filed
with the SEC. As of their respective dates, none of such reports
shall 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. The audited
consolidated financial statements and unaudited interim financial
statements of Bryan included in such reports shall be prepared in
accordance with GAAP applied on a consistent basis (except as may
be indicated in the notes thereto) and shall fairly present the
financial position of Bryan and its Subsidiaries as at the dates
thereof and the results of their operations and changes in
financial position for the periods then ended.
6.14 Termination Fee; Expenses. (a) In the event that this
Agreement is terminated as a result of the occurrence of any
Trigger Event (as defined below), then Bryan shall pay to Buyer a
fee equal to 1.5% of the Purchase Price plus all Reimbursable
Expenses (as defined in Section
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6.14(d)); provided, however, that if such termination is solely
attributable to events described in clause (iii) or (iv) of the
definition of Trigger Event, then Bryan shall pay to Buyer all
Reimbursable Expenses (but not the 1.5% fee). Amounts due
hereunder shall be payable in immediately available funds at the
time of such termination.
(b) As used herein, "Trigger Event" shall mean the
occurrence of any of the following:
(i) the Board of Directors of Bryan (or any
committee thereof) shall approve, recommend, authorize, propose
or facilitate any potential Acquisition Transaction (as
defined below) other than the Offer and the Merger pursuant to
this Agreement, or such Board (or any such committee) shall
engage in discussions or negotiations with a potential
counterparty concerning any such potential Acquisition
Transaction, or such Board (or any such committee) shall publicly
announce its intention to do any of the foregoing;
(ii) the Board of Directors of Bryan (or any
committee thereof) shall fail to recommend the Offer and the
Merger to stockholders of Bryan in the Schedule 14D-9 or proxy
statement required by this Agreement or within two business days
following Buyer's request from time to time that Bryan so confirm
its recommendation of the Offer and the Merger, or such Board (or
any such committee) shall withdraw, modify or amend in any manner
adverse to Buyer the authorization, approval or recommendation
given by such Board (or such committee) to the Offer and the
Merger, or shall publicly announce that it does not favor the
Offer or the Merger;
(iii) the shareholders of Bryan holding at least
66-2/3% of the outstanding shares of Bryan Common Stock shall
fail to approve the Merger in accordance with applicable law at
the Shareholder Meeting, or if the Shareholder Meeting shall not
be held on or prior to December 31, 1998; or
(iv) any person, entity or "group" (as that term
is used in Section 13(d)(e) of the Exchange Act), other than
those shareholders who have executed and delivered Irrevocable
Proxy and Option Agreements as described in the recitals to this
Agreement, becomes the beneficial owner (as defined in Rule 13d-3
promulgated under the Exchange Act) of 15% or more of outstanding
Bryan Common Stock.
(c) As used herein, "Acquisition Transaction" shall mean
any tender offer or exchange offer, any merger, consolidation,
liquidation, dissolution, recapitalization, reorganization or
other business combination, any acquisition, sale or other
disposition of a material amount of assets or securities or any
other similar transaction involving Bryan, its securities or any
of its Subsidiaries or divisions.
(d) As used herein, "Buyer Reimbursable Expenses" means all
out-of-pocket costs (including without limitation reasonable
legal and accounting costs) heretofore and hereafter incurred by
Buyer in connection with the transactions contemplated by this
Agreement including, without limitation, costs and expenses
incurred in connection with (i) Buyer's due diligence
investigations concerning Bryan and its Subsidiaries, (ii)
Buyer's preparation of preliminary and final proposals relating
to the acquisition of Bryan, (iii) Buyer's negotiation of this
Agreement, (iv) Buyer's assistance in the preparation of the
proxy statement relating to the Merger, (v) fees
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and expenses of the Exchange Agent, and (vi) fees and expenses
reasonably incurred so as to facilitate and promote consummation
of the Merger.
ARTICLE VII
CONDITIONS
7.01 Conditions to Each Party's Obligation to Effect the
Merger. The respective obligation of each party to effect the
Merger is subject to the fulfillment, at or prior to the Closing,
of each of the following conditions:
(a) Shareholder Approval. This Agreement and the
transactions contemplated hereby shall have been approved by
Bryan's shareholders in the manner and to the extent required by
applicable law and the Articles of Incorporation and By-laws of
Bryan.
(b) HSR Act. Any waiting period (and any extension
thereof) applicable to the consummation of the Merger under the
HSR Act shall have expired or been terminated.
(c) No Injunctions or Restraints. No action or
proceeding before a court of competent jurisdiction or other
competent governmental body by any Governmental or Regulatory
Authority shall have been instituted or threatened to make
illegal or otherwise restrain or prohibit (whether temporarily,
preliminary or permanently) the Merger or the other transactions
contemplated by this Agreement or to obtain an amount of damages
or other material relief in connection with the execution of the
Agreement or the consummation of the Merger or other transactions
contemplated by this Agreement; and no governmental agency shall
have given notice to any party hereto to the effect that
consummation of the Merger or the other transactions contemplated
by this Agreement would constitute a violation of any law or that
it intends to commence proceedings to restrain consummation of
the Merger (each party hereto, however, agrees to use reasonable
efforts promptly to have such prohibition or notice lifted).
(d) Board Resolutions. Each of Merger Sub and Bryan
shall have received from the other appropriately certified copies
of all resolutions adopted by their respective Boards of
Directors and shareholders in connection with this Agreement and
the transactions contemplated hereby.
7.02 Conditions to Obligation of Buyer and Merger Sub to
Effect the Merger. The obligation of Buyer and Merger Sub to
effect the Merger is further subject to the fulfillment, at or
prior to the Closing, of each of the following additional
conditions (all or any of which may be waived in whole or in part
by Buyer and Merger Sub in their sole discretion):
(a) Bryan shall have performed and complied with, in
all material respects, each agreement, covenant and obligation
required by this Agreement to be so performed or complied with by
Bryan at or prior to the Closing, and Bryan shall have delivered
to Buyer a certificate, dated the Closing Date and executed on
behalf of Bryan by its President, to such effect.
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(b) All proceedings to be taken on the part of Bryan
in connection with the transactions contemplated by this
Agreement and all documents incident thereto shall be reasonably
satisfactory in form and substance to Buyer, and Buyer shall have
received copies of all such documents and other evidences as
Buyer may reasonably request in order to establish the
consummation of such transactions and the taking of all
proceedings in connection therewith.
Such documents shall include, but shall not be limited to:
(i) the certificates required by Section 7.02(a)
of this Agreement;
(ii) a certificate of existence or good standing
regarding each of Bryan and its Subsidiaries, certified in the
case of Bryan by the New Mexico Corporation Commission and
certified in the case of Wendland and Memco by the appropriate
office of the jurisdiction of its respective incorporation, each
dated within ten (10) business days of the Closing Date; and
(iii) an incumbency certificate certifying the
identity of the officers of Bryan.
(iv) the resignations, effective the Closing
Date, of such directors and officers of Bryan, Wendland and Memco
as Buyer shall specify consistent with Section 1.05;
(c) Buyer shall have received a complete list of the
signatories of each account or safe deposit box of Bryan,
Wendland and Memco;
(d) Bryan shall not have received written objections
to the Merger from holders who in the aggregate hold more than
10% of the outstanding shares of Bryan Common Stock, and Bryan
shall not have knowledge that holders of 10% or more of the
outstanding shares of Bryan Common Stock intend to file with
Bryan written objections to the Merger.
(e) Bryan shall have delivered to Buyer a final
accounting of Bryan's Transaction Expenses, in form reasonably
satisfactory to Buyer, including copies of applicable final
invoices;
(f) Other than the filings provided for by Section
1.02, all consents, approvals and actions of filings with and
notices to any Governmental or Regulatory Authority or any other
public or private third party required of Bryan or any of its
Subsidiaries to consummate the Merger and the other transactions
contemplated hereby, the failure of which to be obtained or taken
could, individually or in the aggregate, be reasonably expected
to have a material adverse effect on Bryan and its Subsidiaries
or on the ability of Bryan to consummate the transactions
contemplated hereby shall have been obtained, all in form and
substance reasonably satisfactory to Buyer and no such consent,
approval or action shall contain any term or condition which
could be reasonably expected to result in a material diminution
of the benefits of the Merger to Buyer.
7.03 Conditions to Obligation of Bryan to Effect the
Merger. The obligation of Bryan to effect the Merger is further
subject to the fulfillment, at or prior to the Closing, of each
of the following additional conditions (all or any of which may
be waived in whole or in part by Bryan in its sole discretion):
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(a) Each of the representations and warranties made by
Buyer and Merger Sub in this Agreement shall be true and correct
in all material respects as of the Closing Date as though made on
and as of the Closing Date or, in the case of representations and
warranties made as of a specified date earlier than the Closing
Date, on and as of such earlier date, and Buyer and Merger Sub
shall each have delivered to Bryan a certificate, dated the
Closing Date and executed on behalf of Buyer by its President and
on behalf of Merger Sub by its President, to such effect.
(b) Buyer and Merger Sub shall have performed and
complied with, in all material respects, each agreement, covenant
and obligation required by this Agreement to be so performed or
complied with by Buyer or Merger Sub at or prior to the Closing,
and Buyer and Merger Sub shall each have delivered to Bryan a
certificate, dated the Closing Date and executed on behalf of
Buyer by its President and on behalf of Merger Sub by its
President, to such effect.
(c) Bryan shall have received a written opinion, dated
as of the Closing Date, from Krieg, Devault, Alexander &
Capehart, Indiana counsel to Buyer and Merger Sub, from Cleary,
Gottlieb, Steen & Hamilton and/or from Buyer's New Mexico
counsel, as appropriate, in form and substance reasonably
satisfactory to Bryan, as to certain appropriate matters agreed
upon by legal counsel of Buyer and Merger Sub and of Bryan.
(d) All proceedings to be taken on the part of Buyer
and Merger Sub in connection with the transactions contemplated
by this Agreement and all documents incident thereto shall be
reasonably satisfactory in form and substance to Bryan, and Bryan
shall have received copies of all such documents and other
evidences as Bryan may reasonably request in order to establish
the consummation of such transactions and the taking of all
proceedings in connection therewith. Such documents shall
include, but shall not be limited to:
(i) the certificates required by Section 7.03(a)
and 7.03(b) of this Agreement;
(ii) certificates of existence or good standing
regarding each of Buyer and Merger Sub, certified by the New York
Secretary of State and the New Mexico State Corporation
Commission, respectively, dated within ten (10) business days of
the Closing Date; and
(iii) incumbency certificates certifying the
identity of the officers of Buyer and Merger Sub, respectively.
(e) The Exchange Fund shall have been funded with the
full amount of the Merger Price for all outstanding shares of the
Bryan Common Stock.
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
8.01 Termination. This Agreement may be terminated, and the
transactions contemplated hereby may be abandoned, at any time
prior to the Effective Time, whether prior to or after
Shareholders' Approval:
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(a) by mutual written agreement of the parties hereto
duly authorized by action taken by or on behalf of their
respective Boards of Directors;
(b) by either Bryan or Buyer upon notification to the
non-terminating party by the terminating party:
(i) at any time after January 31, 1999 if the
Merger shall not have been consummated on or prior to such date
and such failure to consummate the Merger is not caused by a
breach of this Agreement by the terminating party; provided,
however, the date may be extended indefinitely by the mutual
written agreement of the parties;
(ii) if Shareholders' Approval shall not be
obtained by January 31, 1999;
(iii) if any Governmental or Regulatory
Authority, the taking of action by which is a condition to the
obligations of either Bryan or Buyer to consummate the
transactions contemplated hereby, shall have determined not to
take such action and all appeals of such determination shall have
been taken and have been unsuccessful; or
(iv) if any court of competent jurisdiction or
other competent Governmental or Regulatory Authority shall have
issued an Order making illegal or otherwise restricting,
preventing or prohibiting the Merger and such Order shall have
become final and nonappealable.
(c) by Bryan, if (1) Merger Sub fails to commence the
Offer as provided in Section A-1.01 or fails to purchase validly
tendered Shares in violation of the terms of the Offer or this
Agreement; (2) there has been a breach by Buyer or Merger Sub of
any representation or warranty contained in this Agreement, or
(3) there has been a material breach of any of the covenants or
agreements set forth in this Agreement on the part of Buyer or
Merger Sub, which breach is not curable or, if curable, is not
cured within ten (10) days after written notice of such breach is
given by Bryan to Buyer or Merger Sub.
(d) by Buyer, if (1) the Offer is terminated or
withdrawn on account of the failure to be fulfilled of a
condition specified in Annex A hereto, (2) there has been a
breach by Bryan of any representation or warranty contained in
this Agreement or (3) there has been a material breach of any of
the covenants or agreements set forth in this Agreement on the
part of Bryan, which breach is not curable or, if curable, is not
cured within ten (10) days after written notice of such breach is
given by Buyer to Bryan.
(e) by Buyer if a Trigger Event occurs.
8.02 Effect of Termination. If this Agreement is validly
terminated by either Bryan or Buyer pursuant to Section 8.01,
this Agreement will forthwith become null and void and there will
be no liability or obligation on the part of either Bryan or
Buyer (or any of their respective Representatives or affiliates),
except (i) that the provisions of Sections 6.01(b), 6.06, 6.07
and 6.14 will continue to apply following any such termination,
and (ii) that nothing contained herein shall relieve any party
hereto from liability for any breach of its representations,
warranties, covenants or agreements contained in this Agreement;
provided however, that no breach of this
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Agreement by Bryan shall be deemed to have occurred if such
termination is solely due to the occurrence of a Trigger Event
described in paragraph 6.14(b)(i) or 6.14(b)(ii), to the extent
that such Trigger Event arose because action was taken by the
Board of Directors of Bryan based upon the belief, and supported
by a written opinion furnished by independent legal counsel, that
the failure to take such action would constitute a breach of
fiduciary duties of such Board of Directors under applicable law.
8.03 Amendment. This Agreement may be amended, supplemented
or modified by the parties hereto at any time prior to the
Effective Time, whether prior to or after adoption of this
Agreement at the Shareholder Meeting, but after such adoption
only to the extent permitted by applicable law. No such
amendment, supplement or modification shall be effective unless
set forth in a written instrument duly executed by or on behalf
of each party hereto.
8.04 Waiver. At any time prior to the Effective Time any
party hereto may to the extent permitted by applicable law (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 of the other
parties hereto contained herein or in any document delivered
pursuant hereto or (iii) waive compliance with any of the
covenants, agreements or conditions of the other parties hereto
contained herein. No such extension or waiver shall be effective
unless set forth in a written instrument duly executed by or on
behalf of the party extending the time of performance or waiving
any such inaccuracy or noncompliance. No waiver by any party of
any term or condition of this Agreement, in any one or more
instances, shall be deemed to be or construed as a waiver of the
same or any other term or condition of this Agreement on any
future occasion.
ARTICLE IX
GENERAL PROVISIONS
9.01 Non-Survival of Representations, Warranties, Covenants
and Agreements. None of the representations, warranties,
covenants and agreements in this Agreement or in any instrument
delivered pursuant to this Agreement, including any rights
arising out of any breach of such representations, warranties,
covenants, and agreements, shall survive the Effective Time,
except for those covenants and agreements contained herein and
therein that by their terms apply or are to be performed in whole
or in part after the Effective Time.
9.02 Knowledge. An individual will be deemed to have
"knowledge" of a particular fact or other matter if such
individual is actually aware of such fact or other matter.
Whenever a provision of this Agreement is qualified as to "the
best knowledge of" or "to the knowledge of" Bryan or Buyer, or is
qualified with words of similar meaning, then the current
officers, directors and senior management of such entity shall be
deemed to have conducted a reasonable inquiry into the question
at hand. The entity will be deemed to have "knowledge" of a
particular fact or other matter if (i) any individual who is
serving, or who has at any time served, as a director, officer,
senior manager or trustee of such person (or in any similar
capacity) has, or at any time had, knowledge of such fact or
other matter, or (ii) such individual would have had such
knowledge if such a reasonable inquiry had been conducted.
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9.03 Notices. All notices, requests and other
communications hereunder must be in writing and will be deemed to
have been duly given only if delivered personally or by facsimile
transmission or mailed (first class postage prepaid) to the
parties at the following addresses or facsimile numbers:
If to Buyer or Merger Sub, to:
Burnham Corporation
1241 Harrisburg Pike
Lancaster, PA 17603
Attn: Albert Morrison III, President and CEO
Facsimile No.: (717) 293-5816
with a copy to:
Cleary, Gottlieb, Steen & Hamilton
One Liberty Plaza
New York, New York 10006
Attn: Donald A. Stern, Esquire
Facsimile No.: (212) 225-3999
If to Bryan, to:
Bryan Steam Corporation
Post Office Box 27
Peru, Indiana 46970
Facsimile No.: (765) 473-6651
Attn: Albert J. Bishop, Chairman
with a copy to:
Barnes & Thornburg
11 South Meridian Street
Indianapolis, Indiana 46204
Facsimile No.: (317) 231-7433
Attn: Eric R. Moy, Esquire
All such notices, requests and other communications will (i) if
delivered personally to the address as provided in this Section,
be deemed given upon delivery, (ii) if delivered by facsimile
transmission to the facsimile number as provided in this Section,
be deemed given upon receipt, and (iii) if delivered by mail in
the manner described above to the address as provided in this
Section, be deemed given upon receipt (in each case regardless of
whether such notice, request or other communication is received
by any other person to whom a copy of such notice is to be
delivered pursuant to this Section). Any party from time to time
may change its address, facsimile number or other information for
the purpose of notices to that party by giving notice specifying
such change to the other parties hereto.
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9.04 Entire Agreement. Except for the Confidentiality
Agreement (as defined in Section 6.01(b)), which shall remain in
full force and effect as provided therein, this Agreement
supersedes all prior discussions and agreements among the parties
hereto with respect to the subject matter hereof and thereof and
contains the sole and entire agreement among the parties hereto
with respect to the subject matter hereof and thereof.
9.05 Public Announcements. Except as otherwise required by
law or the rules of any applicable securities exchange or
national market system, so long as this Agreement is in effect
(until the Closing), Buyer and Bryan will not, and will not
permit any of their respective Representatives to, issue or cause
the publication of any press release or make any other public
announcement with respect to the transactions contemplated by
this Agreement without the consent of the other party, which
consent shall not be unreasonably withheld. Buyer and Bryan will
cooperate with each other in the development and distribution of
all press releases and other public announcements (including
announcements made to the employees, managers, customers,
suppliers and sales representatives of Bryan and its Subsidiaries
and including any interested community members or governmental
officials) with respect to this Agreement and the transactions
contemplated hereby, and will furnish the other with drafts of
any such releases and announcements as far in advance as
practicable.
9.06 No Third Party Beneficiaries. Other than the
Indemnified Parties (as defined in Section 6.10), the terms and
provisions of this Agreement are intended solely for the benefit
of each party hereto and their respective successors or permitted
assigns and it is not the intention of the parties to confer
third party beneficiary rights upon any other person.
9.07 No Assignment, Binding Effect. Neither this Agreement
nor any right, interest or obligation hereunder may be assigned
by any party hereto without the prior written consent of the
other parties hereto and any attempt to do so will be void,
except that Buyer and Merger Sub may assign any or all of their
rights, interests and obligations hereunder to another direct or
indirect wholly-owned Subsidiary of Buyer, provided that any such
Subsidiary agrees in writing to be bound by all of the terms,
conditions and provisions contained herein. Subject to the
preceding sentence, this Agreement is binding upon, inures to the
benefit of and is enforceable by the parties hereto and their
respective successors and assigns.
9.08 Headings. The headings used in this Agreement have
been inserted for convenience of reference only and do not define
or limit the provisions hereof.
9.09 Invalid Provisions. If any provision of this Agreement
is held to be illegal, invalid or unenforceable under any present
or future law, and if the rights or obligations of any party
hereto under this Agreement will not be materially and adversely
affected thereby, (i) such provision will be fully severable,
(ii) this Agreement will be construed and enforced as if such
illegal, invalid or unenforceable provision had never comprised a
part hereof, (iii) the remaining provisions, of this Agreement
will remain in full force and effect and will not be affected by
the legal, invalid or unenforceable provision or by its severance
herefrom and (iv) in lieu of such illegal, invalid or
unenforceable provision, there will be added automatically as a
part of this Agreement a legal, valid and enforceable provision
as similar in terms to such illegal, invalid or unenforceable
provision as may be possible.
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9.10 Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Indiana
applicable to a contract executed and performed in such State
without giving effect to the conflicts of laws principles
thereof, except to the extent that the NMBCA, the Securities Act
and the Exchange Act shall apply to the transactions contemplated
herein.
9.11 Counterparts. This Agreement may be executed in any
number of counterparts, each of which will be deemed an original,
but all of which together will constitute one and the same
instrument. Each counterpart may consist of a number of copies
hereof each signed by less than all, but together signed by all
of the parties hereto.
9.12 Interpretation. In this Agreement, unless the context
otherwise requires, words describing the singular number shall
include the plural and vice versa, and words denoting any gender
shall include all genders and words denoting natural persons
shall include corporations and partnerships and vice versa and
the words "include," "including" and the like shall be deemed not
to be limiting.
9.13 Incorporation of Exhibits. The Exhibits and Schedules
attached hereto and referred to herein are hereby incorporated
herein and made a part hereof for all purposes as if fully set
forth herein.
9.14 Enforcement of Agreement; Injunctive Relief. (a)
Buyer, Merger Sub and Bryan hereby irrevocably and
unconditionally consent to submit to the exclusive jurisdiction
of the United States District Court for the Southern District of
Indiana, Indianapolis Division for federal jurisdiction (unless
such court has no jurisdiction, in which case Buyer, Merger Sub
and Bryan consent to the exclusive jurisdiction of the courts of
the State of Indiana located in Marion County) for any actions,
suits or proceedings arising out of or relating to this Agreement
and the transactions contemplated hereby (and Buyer, Merger Sub
and Bryan agree not to commence any action, suit or proceeding
relating thereto or to this Agreement except in such courts), and
further agree that service of any process, summons, notice or
document by U.S. registered mail to the addresses set forth
herein shall be effective service of process for any such action,
suit or proceedings brought against Buyer, Merger Sub or Bryan in
such court. Bryan, Buyer and Merger Sub hereby irrevocably and
unconditionally waive any objection to the laying of venue of any
action, suit or proceeding arising out of this Agreement or the
transactions contemplated hereby, in such federal court (unless
such court has no jurisdiction, in which case Buyer, Merger Sub
and Bryan consent to the laying of venue in the courts of the
State of Indiana in the County of Marion). Buyer, Merger Sub and
Bryan hereby further irrevocably and unconditionally waive and
agree not to plead or to claim in any such court that any such
action, suit or proceeding brought in any such court has been
brought in an inconvenient forum; and agree not to oppose a
motion to dismiss an improperly filed action. Buyer, Merger Sub
and Bryan waive, to the fullest extent permitted by law, any
rights they may have to a jury trial on any matter related in any
way to this Agreement or the transactions contemplated hereby.
(b) Each of Bryan on the one hand and Buyer and Merger Sub
on the other hand recognize and acknowledge that a breach by it
of any covenants or agreements contained in this Agreement will
cause the other party to sustain damages for which it would not
have an adequate remedy at law for money damages, and therefore
each of the parties hereto agrees that in the
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event of any such breach, if the aggrieved party so desires, the
aggrieved party shall be entitled to the remedy of specific
performance, injunctive and other equitable relief (without the
requirement or need for the posting of any bond) in addition to
any other remedy to which the aggrieved party may be entitled, at
law or in equity.
9.15 Joint and Several Obligations. The obligations of
Buyer and Merger Sub hereunder are joint and several.
[signature page follows]
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IN WITNESS WHEREOF, each party hereto has caused this
Agreement to be signed by its officer thereunto duly authorized
as of the date first above written.
BURNHAM CORPORATION
By:______________________________
Name: Albert Morrison, III
Title: President and Chief
Executive Officer
BURNHAM ACQUISITION CORPORATION
By:______________________________
Name: Albert Morrison, III
Title: President
BRYAN STEAM CORPORATION
By:______________________________
Name:
Title:
<PAGE>
ANNEX A
CONDITIONS TO THE OFFER
Capitalized terms used in this Annex A and not
otherwise defined herein shall have the meanings assigned to them
in the Agreement to which this Annex is attached (the "Merger
Agreement").
Notwithstanding any other provision of the Offer, the
obligation of Merger Sub to accept for payment, purchase or pay
for any Shares tendered prior to the scheduled expiration date of
the Offer or any extension thereof (the "Offer Date") is subject
to the fulfillment, at or prior to the Offer Date, of the
following conditions (and upon the failure of any such condition
to be fulfilled, unless waived by Merger Sub, Merger Sub may
terminate the Offer as to any Shares not then accepted for
payment, and Merger Sub shall not be required to accept for
payment, purchase or, subject to any applicable rules and
regulations of the SEC, including Rule 14e-1(c) under the
Exchange Act, pay for any Shares):
(a) The number of Shares validly tendered and not
withdrawn shall constitute at least a two-thirds
majority plus one of the outstanding Shares on a fully
diluted basis (the "Minimum Condition").
(b) Any waiting period (and any extension thereof)
applicable to the consummation of the Offer under the
HSR Act shall have expired or been terminated.
(c) No action or proceeding before a court of competent
jurisdiction or other competent governmental body by
any Governmental or Regulatory Authority shall have
been instituted or threatened to make illegal or
otherwise restrain or prohibit (whether temporarily,
preliminary or permanently) the Offer or the Merger or
the other transactions contemplated by the Merger
Agreement or to obtain an amount of damages or other
material relief in connection with the execution of
the Merger Agreement or the consummation of the Offer
or other transactions contemplated by the Merger
Agreement; and no governmental agency shall have given
notice to any party hereto to the effect that
consummation of the Offer or the Merger or the other
transactions contemplated by the Merger Agreement
would constitute a violation of any law or that it
intends to commence proceedings to restrain
consummation of the Offer or the Merger.
(d) Merger Sub shall have received from Bryan
appropriately certified copies of all resolutions
adopted by Bryan's Boards of Directors in connection
with the Offer, the Merger, the Merger Agreement and
the transactions contemplated thereby.
(e) Each of the representations and warranties made by
Bryan in the Merger Agreement shall be true and
correct in all respects (subject to limitations as to
materiality as may be contained therein) as though
made on and as of the Offer Date or, in the case of
representations and warranties made as of a specified
date
<PAGE>
earlier than the Offer Date, on and as of such earlier
date, and Bryan shall have delivered to Buyer a
certificate, dated the Offer Date and executed on
behalf of Bryan by its President to such effect.
(f) Bryan shall have performed and complied with, in all
material respects, each agreement, covenant and
obligation required by the Merger Agreement to be so
performed or complied with by Bryan at or prior to the
Offer Date, and Bryan shall have delivered to Buyer a
certificate, dated the Offer Date and executed on
behalf of Bryan by its President, to such effect.
(g) Buyer and Merger Sub shall have received a written
opinion, dated as of the Offer Date, from Barnes &
Thornburg, counsel to Bryan, in form and substance
reasonably satisfactory to Buyer and Merger Sub, as to
certain appropriate matters agreed upon by legal
counsel of Buyer and Merger Sub and of Bryan.
(h) All proceedings to be taken on the part of Bryan on or
before the consummation of the Offer in connection
with the transactions contemplated by the Merger
Agreement and all documents incident thereto shall be
reasonably satisfactory in form and substance to
Buyer, and Buyer shall have received copies of all
such documents and other evidences as Buyer may
reasonably request in order to establish the
consummation of such transactions and the taking of
all proceedings in connection therewith. Such
documents shall include, but shall not be limited to:
(i) the certificates required by clauses (e) and (f)
of this Annex; (ii) a certificate of existence or good
standing regarding each of Bryan and its Subsidiaries,
certified in the case of Bryan by the New Mexico
Corporation Commission and certified in the case of
Wendland and Memco by the appropriate office of the
jurisdiction of its respective incorporation, each
dated within ten (10) business days of the Offer Date;
and (iii) an incumbency certificate certifying the
identity of the officers of Bryan.
(i) Bryan and each of its Subsidiaries shall have good,
marketable and insurable title to their respective
real properties, subject only to those encumbrances
identified in Schedule 7.02 to the Merger Agreement,
and Bryan shall have obtained and delivered to Buyer
reasonable assurances from the relevant municipalities
to the effect that such real properties and their
current operations are in compliance with local zoning
ordinances without constituting non- conforming uses.
(j) Bryan shall have delivered to Buyer a current survey
of the real property and facilities of Bryan located
in Peru, Indiana, which survey (i) shall have been
prepared by a licensed Indiana land surveyor, (ii)
shall fulfill the Minimum Detail Requirements for
ALTA/ACSM Land Title Surveys (1992) for an Urban
Survey and Table A thereof, and (iii) shall have been
certified to the Surviving Corporation, Buyer and
Buyer's title insurance company in a manner reasonably
satisfactory to Buyer; and such survey shall not show
encroachments or other
2
<PAGE>
matters which, individually or in the aggregate,
materially adversely affect the value or use of such
real property and facilities.
(k) There shall not have occurred (A) any general
suspension of, or limitation on prices for, trading in
the securities of a general nature on any national
securities exchange that lasts more than 24 hours, (B)
the declaration of any banking moratorium or any
suspension of payments in respect of banks or any
limitation (whether or not mandatory) on the extension
of credit by lending institutions in the United
States, (C) the commencement of a war, armed
hostilities or any other international or national
calamity involving the United States or a substantial
terrorist attack or the threat thereof on a target in
United States that leads to the declaration of a
national emergency, (D) a material adverse change in
the United States currency exchange rates or a
suspension of, or limitation on, the markets therefor,
or (E) the Dow Jones Index shall fall below 6448
(which was the value of such Index on December 31,
1996).
(l) A Trigger Event shall not have occurred.
(m) Other than the filings provided for by Section 1.02 of
the Merger Agreement, all consents, approvals and
actions of, filings with and notices to any
Governmental or Regulatory Authority or any other
public or private third party required of Bryan or any
of its Subsidiaries to consummate the Offer, the
failure of which to be obtained or taken could,
individually or in the aggregate, be reasonably
expected to have a material adverse effect on Bryan
and its Subsidiaries or on the ability of Buyer to
consummate the purchase of Shares pursuant to the
Offer, shall have been obtained, all in form and
substance reasonably satisfactory to Buyer and no such
consent, approval or action shall contain any term or
condition which could be reasonably expected to result
in a material diminution of the benefits of the Offer
to Buyer.
(n) The Merger Agreement shall not have been terminated
pursuant to its terms and shall not have been amended
pursuant to its terms to provide for its termination.
3
Stockholders' Agreement
In order to induce Burnham Corporation, a New York
corporation ("Buyer"), to execute and deliver the Agreement and
Plan of Merger dated as of the date hereof (as the same may
hereafter be amended, the "Merger Agreement") among Buyer,
Burnham Acquisition Corporation, a New Mexico corporation
("Merger Sub") and Bryan Steam Corporation, a New Mexico
corporation (the "Company"), each undersigned stockholder of the
Company hereby (i) covenants as set forth in the remainder of
this Agreement (the "Agreement"), and (ii) irrevocably appoints
Burnham Corporation, as the exclusive attorney-in-fact and proxy
of such stockholder, with full power of substitution:
(a) to attend any and every meeting (whether annual or
special or both) of the stockholders of the Company,
including any adjournment or postponement thereof, on
behalf of such stockholder, and at each such meeting, with
respect to all shares of common stock of the Company owned
by such stockholder on the date hereof or acquired
hereafter that are entitled to vote at each such meeting or
over which such stockholder has voting power (and any and
all other shares of common or preferred stock of the
Company or other securities issued on or after the date
hereof in respect of any such shares), including, without
limitation, the shares indicated opposite such
stockholder's signature at the end of this Agreement:
(i) to vote in favor of the Merger (as such term
is defined in the Merger Agreement) and to vote in
favor of the adjournment of any meeting, which Buyer
believes may facilitate the obtaining the approval of
the Merger; and otherwise to act with respect to such
shares as said attorney-in-fact and proxy (or his
substitute) shall deem necessary or appropriate to
cause the approval of the Merger by the necessary
majority required under applicable law;
(ii) to vote and otherwise act with respect to
such shares in such a manner as said attorney-in-fact
and proxy (or his substitute) shall deem proper, with
respect to (x) proposals or offers (other than the
Merger) relating to (1) any proposed sale, lease or
other disposition of all or a substantial amount of
the assets of the Company or any of its subsidiaries,
(2) any proposed merger, consolidation or other
combination of the Company or any of its subsidiaries
with any other entity, (3) any sale, issuance,
disposition or granting of rights in respect of the
shares of the Company or of any subsidiary of the
Company or (4) any other proposed action of the
Company or any of its subsidiaries requiring
stockholder approval that would conflict with or
violate the Company's representations, covenants or
obligations under the Merger Agreement, adversely
affect the Company's ability to consummate the Merger
or the other transactions contemplated by the Merger
Agreement or otherwise impede, interfere with or
discourage the Merger (each of the actions described
in (1) - (4) above, an "Acquisition Proposal"), and
(y) any procedural matters presented at any such
meeting at which any action is scheduled to be taken
with respect to the Merger or any Acquisition
Proposal;
1
<PAGE>
(b) if no meeting of stockholders is scheduled in
accordance with the Merger Agreement or if any such meeting
is canceled, postponed or adjourned other than with Buyer's
approval, to call a special stockholders meeting of the
Company for the purpose of (i) approving the Merger or any
action with respect thereto, or (ii) taking action with
respect to any Acquisition Proposal; and
(c) to waive, for the duration of this proxy and
option, any and all rights such stockholder may have to
exercise any rights as dissenting shareholder under
Sections 53- 15-3 and 53-15-4 of the New Mexico Business
Corporation Act, subject to the right to receive the
consideration as specifically provided in the Merger
Agreement.
Each undersigned stockholder agrees (a) not to deposit
any of such stockholder's shares of common stock of the Company
into a voting trust or enter into a voting agreement with respect
to such shares; (b) not to sell, transfer or otherwise dispose of
or pledge or otherwise encumber, any shares of common stock of
the Company, or options or warrants to purchase such shares,
unless the purchaser or transferee of such shares or rights
agrees in writing (a copy of which shall be delivered by such
stockholder to Buyer and Merger Sub) prior to such sale, transfer
or disposition to be bound by and subject to the provisions
contained in this Agreement; and (c) not, in his or her capacity
as stockholder, to solicit, initiate, encourage, endorse, support
(including, by providing information) or participate in any
discussions regarding, any Acquisition Proposal other than the
Merger.
Each undersigned stockholder affirms that this proxy
is issued in connection with the Merger Agreement to facilitate
the transactions contemplated thereunder and in consideration of
Buyer and Merger Sub entering into the Merger Agreement and as
such is coupled with an interest and is irrevocable. This proxy
will terminate upon the earlier to occur of (a) the Effective
Time as defined in the Merger Agreement and (b) the termination
of the Merger Agreement in accordance with its terms. For
purposes of this proxy, any notice of any stockholders' meeting
shall be deemed delivered to the attorney-in-fact and proxy and
his substitutes when delivered to Buyer in accordance with the
Merger Agreement.
By execution and delivery of this Agreement, each
undersigned stockholder confirms that such stockholder has
received a copy of a substantially final form of the Merger
Agreement, and that all other information deemed necessary by
such stockholder concerning the Merger, the Merger Agreement and
the transactions contemplated thereunder or any other matters
considered by such stockholder to be relevant to the
stockholder's decision to execute this Agreement has been made
available to such stockholder.
All authority herein conferred or agreed to be
conferred shall survive the death, insolvency, or incapacity of
any undersigned stockholder and any obligation of any undersigned
stockholder hereunder shall be binding upon the heirs, personal
representatives, successors and assigns of such undersigned
stockholder.
This proxy revokes any and all other proxies
heretofore granted by each and every undersigned stockholder to
vote or otherwise to act with respect to any of the shares to
which this proxy relates. No undersigned stockholder will give
any subsequent proxy or grant any option
2
<PAGE>
with respect to such shares (and such proxy or option if given
will be deemed not to be effective) with respect to such shares
that purports to grant authority within the scope of the
authority hereby conferred.
In order further to induce Merger Sub and Buyer to
enter into the Merger Agreement, each undersigned stockholder
hereby further agrees validly to tender (or cause the record
owner of such shares validly to tender), and not to withdraw,
pursuant to and in accordance with the terms of the Offer, not
later than the tenth business day after commencement of the Offer
pursuant to Section A-1.01 of the Merger Agreement and Rule 14d-2
under the Exchange Act, the number of shares of Bryan Common
Stock set forth opposite such stockholder's name below (the
"Existing Securities" and, together with any shares of Bryan
Common Stock acquired by such stockholder (whether beneficially
or of record) after the date hereof and prior to the termination
of this Agreement by means of purchase, dividend, distribution,
transfer, issuance, or exercise of options or other rights to
acquire Bryan Common Stock (the "Securities")). If any
undersigned stockholder acquires Securities after the date
hereof, such stockholder shall tender (or cause the record holder
to tender) such Securities on or before such tenth business day
or, if later, on or before the second business day after such
acquisition. Each undersigned stockholder hereby acknowledges and
agrees that Merger Sub's obligation to accept for payment,
purchase and pay for the Securities in the Offer, including the
Securities beneficially owned by such stockholder, is subject to
the terms and conditions of the Offer.
Each undersigned stockholder hereby permits Merger Sub
and Buyer to disclose in the Offer documents (and in the proxy
statement, if any, applicable to the Merger) such stockholder's
identity and ownership of the Securities and the content of this
Agreement.
Each undersigned stockholder acknowledges that money
damages would be both incalculable and an insufficient remedy for
any breach of this Agreement by it, and that any such breach
would cause Buyer and Merger Sub irreparable harm. Accordingly,
each undersigned stockholder agrees that in the event of any
breach or threatened breach of this Agreement, Buyer and Merger
Sub, in addition to any other remedies at law or in equity they
may have, shall be entitled, without the requirement of posting a
bond or other security, to equitable relief, including injunctive
relief and specific performance.
The invalidity or unenforceability of any provision of
this Agreement in any jurisdiction shall not affect the validity
or enforceability of any other provision of this Agreement in
such jurisdiction, or the validity or enforceability of any
provision of this Agreement in any other jurisdiction.
Each undersigned stockholder represents and warrants
that, as of the date hereof, such stockholder (a) owns personally
and directly the number of shares of Bryan Common Stock (as
defined in the Merger Agreement) set forth following such
stockholder's name below, (b) owns such stock free and clear of
all liens, security interests, encumbrances, options and other
adverse interests of every kind whatsoever, and (c) may execute
and deliver this Agreement, and perform its obligations
hereunder, without the consent or agreement of any other person
or entity.
3
<PAGE>
Each of the undersigned stockholders hereby
irrevocably waives and releases any and all claims such
stockholder may have as a holder of shares of the Company against
any employee, officer or director of Bryan or any of its
subsidiaries in respect of the conduct of such employee, officer
or director in his or her capacity as such prior to consummation
of the Merger.
For the convenience of the parties, this Agreement may
be executed in one or more counterparts, each of which shall be
deemed an original, but all of which together shall constitute
one and the same instrument.
This Agreement will only become effective upon the
execution and delivery of the Merger Agreement by Buyer, Merger
Sub and the Company. Capitalized terms used and not defined
herein will have the respective meanings set forth in the Merger
Agreement.
This Agreement shall be governed by the laws of the
State of Indiana except that the provisions hereof with respect
to the granting of proxies, the exercise of the rights granted in
respect of such proxies and the associated appointment of
attorneys-in-fact will be governed by the laws of the
jurisdiction of incorporation of the Company.
Dated: as of September __, 1998
[signature pages follow]
4
<PAGE>
STOCKHOLDERS OF BRYAN STEAM CORPORATION
/s/ Robert L. Miller
---------------------------
Robert Miller
R.R. #2, Box 26
Peru, Indiana 46970
12,198 Shares of Bryan Common
----------
Stock Owned
/s/ Ina Mae Miller
---------------------------
Ina Mae Miller
R.R. #2, Box 26
Peru, Indiana 46970
12,199 Shares of Bryan Common
----------
Stock Owned
/s/ Beverly Bryan
---------------------------
Beverly Bryan
6299 Valley View Drive
Fishers, Indiana 46038
11,591 Shares of Bryan Common
----------
Stock Owned
Georgeanna Williams Revokable Living Trust
by:/s/ Georgeanna Williams
---------------------------
Georgeanna Williams, Trustee
R.R., #3, Box 326A
Peru, Indiana 46970
5,491 Shares of Bryan Common
----------
Stock Owned
/s/ Lisa Lockhart
---------------------------
Lisa Lockhart
10778 Pine Valley Court
Fishers, Indiana 46038
3,060 Shares of Bryan Common
----------
Stock Owned
11,591 Shares of Bryan Common Stock Owned
Jointly with Beverly Bryan and Kenneth
Starkey
5
<PAGE>
/s/ Charles J. Miller
---------------------------
Charles Miller
516B Chinworth Court
Warsaw, Indiana 46580
5,492 Shares of Bryan Common
----------
Stock Owned
/s/ Kenneth Starkey
---------------------------
Kenneth Starkey
10356 Leeward Boulevard
Indianapolis, Indiana 46256
3,059 Shares of Bryan Common
----------
Stock Owned
11,591 Shares of Bryan Common Stock Owned
Jointly with Beverly Bryan and Kenneth
Starkey
/s/ Bryan Herd - Sharon Lee Herd
---------------------------
Bryan Herd and Sharon Herd
1208 Glenwick Drive
Logansport, Indiana 46947
17,706 Shares of Bryan Common
----------
Stock Owned Jointly
/s/ Marilyn Malott and
Paul J. Malott
---------------------------
Marilyn Malott and Paul J. Malott
1500 Liberty Street
Logansport, Indiana 46947
17,829 Shares of Bryan Common
----------
Stock Owned Jointly
/s/ Victor L. Herd and
Kristine G. Herd
---------------------------
Victor Herd and Kristine G. Herd
4083 S.E. Honey Hill Lane
Stuart, Florida 34997
17,690 Shares of Bryan Common
----------
Stock Owned Jointly
6
<PAGE>
STATE OF INDIANA )
)SS:
COUNTY OF )
Before me, a Notary Public, in and for said County and
State, personally appeared Robert Miller, and acknowledged the
execution of the foregoing instrument, this 22nd day of
September, 1998.
Witness my hand and Notarial Seal this 22nd day of
September, 1998.
/s/ Debra A. Eiler
---------------------------
Debra A. Eiler Notary Public
residing in Miami County,
Indiana
My Commission Expires:
Aug 11, 2001
- -------------------------
SEAL
STATE OF INDIANA )
)SS:
COUNTY OF )
Before me, a Notary Public, in and for said County and
State, personally appeared Ina Mae Miller, and acknowledged the
execution of the foregoing instrument, this 22nd day of
September, 1998.
Witness my hand and Notarial Seal this 22nd day of
September, 1998.
/s/ Debra A. Eiler
---------------------------
Debra A. Eiler Notary Public
residing in Miami County,
Indiana
My Commission Expires:
Aug 11, 2001
- -------------------------
7
<PAGE>
STATE OF INDIANA )
)SS:
COUNTY OF MIAMI )
Before me, a Notary Public, in and for said County and
State, personally appeared Beverly Bryan, and acknowledged the
execution of the foregoing instrument, this 21st day of
September, 1998.
Witness my hand and Notarial Seal this 21st day of
September, 1998.
/s/ Laura L. Fulton
---------------------------
Notary Public
residing in Miami County,
Indiana
My Commission Expires:
Aug 25, 2000
- -------------------------
8
<PAGE>
STATE OF INDIANA )
)SS:
COUNTY OF MIAMI )
Before me, a Notary Public, in and for said County and
State, personally appeared Georgeanna Williams, the Trustee of
the Georgeanna Willliams Revocable Trust, who acknowledged the
execution of the foregoing instrument, this 23rd day of
September, 1998.
Witness my hand and Notarial Seal this 23rd day of
September, 1998.
/s/ Laura L. Fulton
---------------------------
Notary Public
residing in Miami County,
Indiana
My Commission Expires:
August 25, 2000
- -------------------------
9
<PAGE>
STATE OF INDIANA )
)SS:
COUNTY OF )
Before me, a Notary Public, in and for said County and
State, personally appeared Lisa Lockhart, and acknowledged the
execution of the foregoing instrument, this 22nd day of
September, 1998.
Witness my hand and Notarial Seal this 22nd day of
September, 1998.
/s/ Denise A. Weaver
---------------------------
Notary Public
residing in Hamilton County,
Indiana
My Commission Expires:
9-20-02
- -------------------------
STATE OF INDIANA )
)SS:
COUNTY OF MIAMI )
Before me, a Notary Public, in and for said County and
State, personally appeared Charles Miller, and acknowledged the
execution of the foregoing instrument, this 21st day of
September, 1998.
Witness my hand and Notarial Seal this 21st day of
September, 1998.
/s/ Laura L. Fulton
---------------------------
Notary Public
residing in Miami County,
Indiana
My Commission Expires:
August 25, 2000
- -------------------------
10
<PAGE>
STATE OF INDIANA )
)SS:
COUNTY OF MIAMI )
Before me, a Notary Public, in and for said County and
State, personally appeared Kenneth Starkey, and acknowledged the
execution of the foregoing instrument, this 22nd day of
September, 1998.
Witness my hand and Notarial Seal this 22nd day of
September, 1998.
/s/ Laura L. Fulton
---------------------------
Notary Public
residing in Miami County,
Indiana
My Commission Expires:
August 25, 2000
- -------------------------
STATE OF INDIANA )
)SS:
COUNTY OF MIAMI )
Before me, a Notary Public, in and for said County and
State, personally appeared Bryan Herd, and acknowledged the
execution of the foregoing instrument, this 21st day of
September, 1998.
Witness my hand and Notarial Seal this 21st day of
September, 1998.
/s/ Laura L. Fulton
---------------------------
Notary Public
residing in Miami County,
Indiana
My Commission Expires:
August 25, 2000
- -------------------------
11
<PAGE>
STATE OF INDIANA )
)SS:
COUNTY OF MIAMI )
Before me, a Notary Public, in and for said County and
State, personally appeared Marilyn Malott, and acknowledged the
execution of the foregoing instrument, this 21st day of
September, 1998.
Witness my hand and Notarial Seal this 21st day of
September, 1998.
/s/ Laura L. Fulton
---------------------------
Notary Public
residing in Miami County,
Indiana
My Commission Expires:
August 25, 2000
- -------------------------
STATE OF INDIANA )
)SS: Victor L. Herd
COUNTY OF Martin)
Before me, a Notary Public, in and for said County and
State, personally appeared Victor Herd, and acknowledged the
execution of the foregoing instrument, this 19 day of
September, 1998. /s/ Victor L. Herd
------------------
Witness my hand and Notarial Seal this 19th day of
September, 1998.
/s/ Maynard L. Long
---------------------------
Notary Public
residing in Palm Beach County,
Florida
My Commission Expires: SEAL Maynard L. Long
5-23, 2000 Comm. No. CC 557144
- ------------------------- My Comm. Exp. May 23, 2000
Bonded thru Pichard Ins. Agcy.
12
<PAGE>
STATE OF INDIANA )
)SS:
COUNTY OF MIAMI )
Before me, a Notary Public, in and for said County and
State, personally appeared Paul Malott, and acknowledged the
execution of the foregoing instrument, this 21st day of
September, 1998.
Witness my hand and Notarial Seal this 21st day of
September, 1998.
/s/ Laura L. Fulton
---------------------------
Notary Public
residing in Miami County,
Indiana
SEAL
My Commission Expires:
August 25, 2000
- -------------------------
STATE OF INDIANA )
)SS:
COUNTY OF MIAMI )
Before me, a Notary Public, in and for said County and
State, personally appeared Sharon Herd, and acknowledged the
execution of the foregoing instrument, this 21st day of
September, 1998.
Witness my hand and Notarial Seal this 21st day of
September, 1998.
/s/ Laura L. Fulton
---------------------------
Notary Public
residing in Miami County,
Indiana
SEAL
My Commission Expires:
August 25, 2000
- -------------------------
13
<PAGE>
STATE OF FLORIDA )
)SS: STUART
COUNTY OF MARTIN )
Before me, a Notary Public, in and for said County and
State, personally appeared Kristine G. Herd and acknowledged the
execution of the foregoing instrument, this 23rd day of
September, 1998. /s/ Kristine G. Herd
--------------------
Witness my hand and Notarial Seal this 23 day of
September, 1998.
/s/ Deloris Vance
---------------------------
Notary Public
residing in Martin County,
Florida
My Commission Expires:
9/2001
- ------------------------- SEAL DELORIS VANCE
Comm. No. CC 678543
My Comm. Exp. Sept 8, 2001
Bonded thru Pichard Ins. Agcy.
14
