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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant / /
Filed by a Party other than the Registrant /X/
Check the appropriate box:
/X/ Preliminary Proxy Statement
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/ / Soliciting Material Pursuant to Section 240.14a-11(c) or Section 240.14a-12
COMMERCIAL INTERTECH CORP.
(Name of Registrant as Specified in its Charter)
UNITED DOMINION INDUSTRIES LIMITED
and
OPUS ACQUISITION CORPORATION
(Name of Person(s) Filing Proxy Statement)
------------------------
Payment of Filing Fee (Check the appropriate box):
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2).
/X/ $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
/X/ Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid: $500
(2) Form, Schedule or Registration Statement No.: Schedule 14A
(3) Filing Party: Same
(4) Date Filed: July 24, 1996
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PRELIMINARY MATERIALS DATED JULY 26, 1996
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The information included herein is as it is expected to be when the definitive
proxy statement is mailed to shareholders of Commercial Intertech Corp.
This proxy statement will be revised to reflect actual
facts at the time of filing of the definitive
proxy statement.
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PROXY STATEMENT
OF
UNITED DOMINION INDUSTRIES LIMITED
AND
OPUS ACQUISITION CORPORATION
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SPECIAL MEETING OF SHAREHOLDERS
OF
COMMERCIAL INTERTECH CORP.
INTRODUCTION
This Proxy Statement and the accompanying GOLD-STRIPED Special Meeting
proxy card are being furnished to holders of outstanding common shares, par
value $1.00 per share ("Common Shares"), and ESOP Convertible Preferred Shares
Series B, without par value ("Preferred Shares" and, together with the Common
Shares, the "Shares"), of Commercial Intertech Corp., an Ohio corporation (the
"Company"), in connection with the solicitation of proxies from holders of the
Shares by United Dominion Industries Limited, a Canadian corporation ("Parent"),
and Opus Acquisition Corporation, a Delaware corporation and indirect wholly
owned subsidiary of Parent (the "Purchaser"), to be used at a special meeting of
shareholders of the Company and at any adjournments or postponements thereof
(the "Special Meeting") to be called for the purpose of considering and voting
on the proposals described below under "SPECIAL MEETING PROPOSALS" in the order
set forth below (the "Special Meeting Proposals"). As used herein, unless the
context otherwise requires, the term "Common Shares" shall include the
associated Rights (as defined below).
PARENT AND THE PURCHASER URGE YOU TO SIGN, DATE AND RETURN THE ENCLOSED
GOLD-STRIPED SPECIAL MEETING PROXY CARD TO VOTE FOR THE SPECIAL MEETING
PROPOSALS.
A VOTE FOR THE SPECIAL MEETING PROPOSALS WILL HELP ENABLE YOU, AS THE
OWNERS OF THE COMPANY, TO DECIDE WHETHER YOU WILL HAVE THE OPPORTUNITY TO SELL
YOUR SHARES TO THE PURCHASER FOR $30 IN CASH PURSUANT TO ITS PENDING OFFER. NOT
VOTING WILL HAVE THE SAME EFFECT AS VOTING AGAINST THE SPECIAL MEETING PROPOSALS
AND AGAINST YOUR RIGHT TO RECEIVE $30 NET PER COMMON SHARE PURSUANT TO THE
PURCHASER'S OFFER.
PARENT AND THE PURCHASER URGE YOU NOT TO SIGN ANY PROXY CARD SENT TO YOU BY
THE COMPANY. IF YOU HAVE ALREADY DONE SO, YOU MAY REVOKE YOUR PROXY BY
DELIVERING A WRITTEN NOTICE OF REVOCATION OR A LATER DATED PROXY FOR THE SPECIAL
MEETING TO PARENT, C/O MACKENZIE PARTNERS., INC. ("MACKENZIE PARTNERS"), 156
FIFTH AVENUE, NEW YORK, NEW YORK 10010, OR TO THE SECRETARY OF THE COMPANY, OR
IN AN OPEN MEETING OF COMPANY SHAREHOLDERS. SEE "PROXY PROCEDURES" BELOW.
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Under the Ohio Revised Code (the "ORC") and the Code of Regulations of the
Company (the "Company Regulations"), a special meeting of the Company's
shareholders may be called at any time by, among others, the holders of at least
40% of the outstanding Shares (the "Requisite Holders"). Parent and the
Purchaser are, simultaneously with the solicitation of proxies for use at the
Special Meeting, soliciting by means of a Solicitation Statement dated July 24,
1996 (the "Solicitation Statement"), appointments of Designated Agents ("Agent
Designations") to appoint agents of the Company's shareholders (the "Designated
Agents") to call, and take certain other actions in connection with, the Special
Meeting. On July 18, 1996, the Company announced that its Board of Directors
(the "Company's Board") had purported to fix September 3, 1996 as the record
date for determining shareholders entitled to execute Agent Designations for the
purpose of calling the Special Meeting. Parent and the Purchaser believe that
the purported setting of a record date by the Company's Board is invalid under
the Company Regulations, which, in accordance with the ORC, provide that a
special meeting of the Company's shareholders may be called "AT ANY TIME" by the
Requisite Holders. Accordingly, Parent and the Purchaser intend to deliver a
written request (the "Written Request") to the Company to call the Special
Meeting as soon as possible after the date upon which Parent and the Purchaser
have received Agent Designations from the Requisite Holders. Under the Company
Regulations, the Requisite Holders may in the Written Request designate the time
and place of a special meeting called by them. Parent and the Purchaser
currently intend the Special Meeting to be held as soon as practicable following
receipt of Agent Designations from the Requisite Holders, subject to the
requirements of the ORC and the Company Regulations, and intend to designate
such time for the Special Meeting in the Written Request. Holders will be given
notice (the "Notice") of the time and place of the Special Meeting in accordance
with the Company Regulations. See "SOLICITATION OF AGENT DESIGNATIONS; CALLING
OF SPECIAL MEETING."
Under the ORC, the Company's Board may fix a record date for the purpose of
determining the holders of Shares who are entitled to receive notice of and to
vote at the Special Meeting (the "Special Meeting Record Date"), which shall not
be a date earlier than the date on which the Special Meeting Record Date is
fixed nor more than 60 days preceding the date of the Special Meeting. No
Special Meeting Record Date has yet been fixed. In the Written Request, the
Designated Agents will request the Company's Board to fix a Special Meeting
Record Date by the time they cause the Notice of the Special Meeting to be given
to the Company's shareholders. The ORC provides that, if the Company's Board
shall fail or refuse, within such time as the Designated Agents may request, to
fix a Special Meeting Record Date, then the Designated Agents may fix a Special
Meeting Record Date, subject to the limitations described above or, if no record
date is fixed for determining shareholders entitled to vote at the Special
Meeting, then such record date shall be the date next preceding the day on which
the Special Meeting is held.
THE GOLD-STRIPED PROXY WILL NOT CONSTITUTE AN AGENT DESIGNATION TO CALL THE
SPECIAL MEETING. SHAREHOLDERS ARE URGED TO PROMPTLY SIGN AND RETURN THE WHITE
AGENT DESIGNATIONS FURNISHED WITH THE SOLICITATION STATEMENT OF PARENT AND THE
PURCHASER AS WELL AS THE GOLD-STRIPED SPECIAL MEETING PROXY AND THE WHITE PROXY
FOR THE OHIO CONTROL SHARE ACQUISITION MEETING (AS DEFINED HEREIN).
This Proxy Statement and accompanying GOLD-STRIPED Special Meeting proxy
card are first being furnished to Company shareholders on or about August ,
1996. Proxies should be delivered as promptly as possible, but in no event later
than the Special Meeting, by fax or by mail (using the enclosed envelope), to
Parent's information agent, MacKenzie Partners, Inc. ("MacKenzie Partners"), 156
Fifth Avenue, New York, New York 10010, Fax: (212) 929-0308. The principal
executive offices of the Company are located at 1775 Logan Avenue, Youngstown,
Ohio 44510.
According to the Company's recently amended Annual Report on Form 10-K/A
for the fiscal year ended October 31, 1995 (the "Company 1995 10-K/A"), as of
July 15, 1996 there were 14,665,404 Common Shares outstanding and, as of October
31, 1995, there were outstanding options to purchase 617,051 Common Shares, and,
according to the Company's Quarterly Report on Form 10-Q for the quarter ended
April 30, 1996 (the "Company Form 10-Q"), as of April 30, 1996 there were
1,039,657 Preferred Shares (convertible into 1,283,976 Common Shares)
outstanding. According to amendments filed by the Company through July 24,
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1996 to the Solicitation/Recommendation Statement on Schedule 14D-9 originally
filed by the Company on July 12, 1996 (as amended from time to time, the
"Schedule 14D-9"), the Company has repurchased 1,798,600 Common Shares pursuant
to its repurchase program first announced by the Company on July 12, 1996 (the
"Repurchase Program"), 951,000 of which were repurchased after July 15, 1996.
The Company has admitted in litigation proceedings and in the recently filed
Company 1995 10K/A that each Preferred Share is entitled to only one vote
despite statements to the contrary in its public filings prior thereto in which
the Company recognized one and one-half votes per Preferred Share. Thus,
assuming exercise of all options and conversion of all Preferred Shares and
assuming that since the respective dates for which information is given no
additional Shares have been issued or repurchased and no additional options
granted (and assuming that no additional Shares are issued or repurchased prior
to the Special Meeting Record Date), proxies from the holders of at least
10,409,293 Shares (excluding the 1,000 Common Shares owned by Parent and the
Purchaser), representing two-thirds of the total number of Shares outstanding,
must be received by Parent and the Purchaser in order to obtain the necessary
majority to approve all of the Special Meeting Proposals (although in the event
the election of directors is by cumulative voting, Parent and the Purchaser will
need to obtain proxies from holders of at least 11,710,574 Shares (or 75% of the
aggregate voting Shares outstanding, excluding the 1,000 Common Shares owned by
Parent and the Purchaser) in order to ensure that all of the Parent Nominees (as
defined below) are elected to the Company's Board). See "SPECIAL MEETING
PROPOSALS" below for the vote required to approve each individual Special
Meeting Proposal.
The Preferred Shares are held of record by Mellon Bank N.A., as trustee
(the "ESOP Trustee") for the Company's Employee Stock Ownership Plan and
Retirement Stock Ownership and Savings Plan (the "ESOPs"). According to the
Company's proxy statement for its 1996 Annual Meeting of Shareholders (the
"Annual Meeting Proxy Statement"), the trusts for these plans (the "ESOP
Trusts") contain pass-through voting provisions for the participants of the
ESOPs, with Preferred Shares that are allocated to a participant's account voted
by the ESOP Trustee as instructed by the participant and Preferred Shares that
either are not allocated to any participant's account or are allocated but for
which no instruction from the participant has been received by the ESOP Trustee
voted by the ESOP Trustee in the same proportions as the allocated shares for
which instructions were received are voted. See "VOTING AT THE SPECIAL MEETING"
and "CERTAIN LEGAL MATTERS" below. PARTICIPANTS IN THE ESOPS CAN ONLY VOTE WITH
RESPECT TO SHARES HELD IN THE ESOPS ON THEIR BEHALF BY INSTRUCTING THE ESOP
TRUSTEE ON THE FORM THAT SHOULD BE PROVIDED BY THE ESOP TRUSTEE TO PARTICIPANTS
FOR THAT PURPOSE. ESOP PARTICIPANTS CANNOT VOTE WITH RESPECT TO SHARES ALLOCATED
TO THEIR ESOP ACCOUNT BY EXECUTING THE ACCOMPANYING GOLD-STRIPED PROXY.
Similarly, certain Common Shares are held of record by National City Bank,
N.E., as trustee (the "Plan Trustee") for the Company's Non-Qualified Stock
Purchase Plan and the Employee Savings and Stock Purchase Plan (the "Plans").
The trusts for these Plans (the "Plan Trusts") contain pass-through voting
provisions for the participants of the Plans, with Common Shares that are
allocated to a participant's account voted by the Plan Trustee as instructed by
the participant and Common Shares that either are not allocated to any
participant's account or are allocated but for which no instruction from the
participant has been received by the Plan Trustee voted by the Plan Trustee, in
its sole discretion. PARTICIPANTS IN THE PLANS CAN ONLY VOTE WITH RESPECT TO
COMMON SHARES HELD IN THE PLANS ON THEIR BEHALF BY INSTRUCTING THE PLAN TRUSTEE
ON THE FORM THAT SHOULD BE PROVIDED TO PARTICIPANTS BY THE PLAN TRUSTEE FOR THAT
PURPOSE. PLAN PARTICIPANTS CANNOT VOTE WITH RESPECT TO COMMON SHARES ALLOCATED
TO THEIR PLAN ACCOUNT BY EXECUTING THE ACCOMPANYING GOLD-STRIPED PROXY CARD.
Proxies representing Common Shares held of record will include Common
Shares allocated to participants under the Automatic Dividend Reinvestment Plan
(the "Dividend Reinvestment Plan") for shareholders of the Company. The
GOLD-STRIPED Special Meeting proxy accompanying this Proxy Statement can be used
to vote such Common Shares held under the Dividend Reinvestment Plan.
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PURPOSE OF THIS SOLICITATION OF PROXIES
The Purchaser has commenced a tender offer to purchase all outstanding
Common Shares (and associated Rights (as defined below)) at a price of $30 per
Common Share (and associated Right), net to the seller in cash, without interest
thereon (the "Offer Price"), upon the terms and subject to the conditions set
forth in a Revised Offer to Purchase dated July 16, 1996 (the "Offer to
Purchase") and related Revised Letter of Transmittal (the "Letter of
Transmittal") (which, as either may be amended from time to time, together
constitute the "Offer"). The Offer, which was announced on July 15, 1996,
amended the terms of the Purchaser's original offer which the Purchaser
commenced on July 12, 1996 at a price of $27 per Common Share (and associated
Right) (the "Original Offer").
The purpose of the Offer and the Proposed Merger (as defined below) is to
enable the Purchaser to acquire control of, and the entire equity interest in,
the Company. The Offer, as the first step in the acquisition of the Company, is
intended to facilitate the acquisition of all outstanding Shares. Parent
intends, following the completion of the Offer, to seek to have the Company
effect a merger or similar business combination with the Purchaser at the same
price per Common Share as the price per Common Share to be paid in the Offer
(the "Proposed Merger"), subject to the terms and conditions described in the
Offer to Purchase. The Purchaser's ability and willingness to accept Common
Shares tendered to it in the Offer, and to consummate the Proposed Merger, are
subject to certain terms and conditions (described below under "TERMS AND
CONDITIONS OF THE OFFER" and in the Offer to Purchase), certain of which terms
and conditions can only be satisfied in connection with a duly called special or
annual meeting of the Company shareholders.
Parent and the Purchaser are seeking to call the Special Meeting so that
the Company's shareholders will have the opportunity to consider and vote upon
the Special Meeting Proposals, which will include resolutions (i) to appoint
to preside as chairman of the Special Meeting in accordance with
the Company Regulations, (ii) calling upon the Company's incumbent directors to
redeem, prior to their removal as directors, the preferred share purchase rights
(the "Rights") associated with the Common Shares pursuant to the Company's
Rights Agreement, dated as of November 29, 1989, between the Company and The
Mahoning National Bank of Youngstown, as rights agent (the "Rights Agreement"),
(iii) to remove all incumbent directors of the Company, and to amend the Company
Regulations to reduce the size of the Company's Board from 12 members to three
members and to provide that the directors shall serve as a single class having
the same term of office and shall not be divided into three classes having
staggered terms, (iv) to amend the Company Regulations to provide that Section
1701.831 of the ORC (the "Ohio Control Share Acquisition Law") shall not apply
to "control share acquisitions" of Shares, (v) to elect three new directors
nominated by Parent and the Purchaser (the "Parent Nominees") to fill the
vacancies resulting from the removal of all incumbent directors of the Company
and reduction of the size of the Company's Board, and (vi) to amend the
Company's Amended and Restated Articles of Incorporation (the "Company
Articles") to repeal Article SIXTH thereof. See "SPECIAL MEETING PROPOSALS"
below.
IF YOU WISH TO HAVE THE OPPORTUNITY TO RECEIVE THE OFFER PRICE IN CASH FOR
ALL OF YOUR COMMON SHARES, PARENT AND THE PURCHASER URGE YOU TO COMPLETE, SIGN
AND RETURN YOUR GOLD-STRIPED PROXY BY THE SPECIAL MEETING.
Shareholder approval of the Special Meeting Proposals will not require you
to tender your Common Shares to the Purchaser in the Offer, but the Purchaser
may require that the Special Meeting Proposals be approved at the Special
Meeting before it will accept for payment Common Shares tendered pursuant to the
Offer. Tendering Common Shares pursuant to the Offer will not constitute a vote
in favor of the Special Meeting Proposals and will not, by itself, increase the
likelihood of the Offer being consummated. Instead, in order to support the
Offer, you must vote in favor of the Special Meeting Proposals at the Special
Meeting and in favor of the Purchaser's acquisition of Common Shares in the
Offer at the Ohio Control Share Acquisition Meeting.
THE FAILURE TO EXECUTE AND RETURN THE GOLD-STRIPED PROXY WILL HAVE THE SAME
EFFECT AS OPPOSING THE SPECIAL MEETING PROPOSALS AND MAY RESULT IN WITHDRAWAL OF
THE OFFER.
Parent intends to continue to seek to negotiate with the Company with
respect to the acquisition of the Company. If such negotiations result in a
definitive merger agreement between the Company and Parent,
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certain material terms of the Offer may change and Parent may elect not to
proceed with any solicitation of proxies for use at the Special Meeting.
Accordingly, such negotiations could result in, among other things, termination
or amendment of the Offer and/or submission of a different acquisition proposal
to the Company shareholders for their approval.
A copy of the Tender Offer Statement on Schedule 14D-1, which was filed by
the Purchaser with the Securities and Exchange Commission (the "Commission") on
July 12, 1996, and all amendments thereto (including Amendment No. 2 thereto
filed July 16, 1996, which includes the Offer to Purchase and Letter of
Transmittal), may be obtained from the Commission, upon payment of the
Commission's customary charges, by writing to its principal office at 450 Fifth
Street, N.W., Judiciary Plaza, Room 1024, Washington, D.C. 20549. Such material
is also available for inspection and copying at the principal office of the
Commission at the address set forth immediately above, at the Commission's
regional offices at Seven World Trade Center, 13th Floor, New York, New York
10048 and Citicorp Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661, and at the offices of the New York Stock Exchange (the "NYSE"),
20 Broad Street, New York, New York 10005. Such material should also be
available on-line through the Commission's EDGAR electronic filing and retrieval
system.
On July 12, 1996, Parent and the Purchaser delivered to the Company an
"acquiring person statement" pursuant to the Ohio Control Share Acquisition Law
in connection with the Purchaser's proposed acquisition of Common Shares (the
"Proposed Control Share Acquisition") in the Offer. Within ten days of the
receipt of such acquiring person statement, the Ohio Control Share Acquisition
Law requires that the Company's Board call a special meeting of shareholders of
the Company for the purpose of voting on the Proposed Acquisition (the "Ohio
Control Share Acquisition Meeting"). On July 18, 1996, the Company issued a
press release announcing that Company's Board had called the Ohio Control Share
Acquisition Meeting to be held on August 30, 1996. The solicitation of proxies
pursuant to this Proxy Statement does not relate to the Ohio Control Share
Acquisition Meeting. Parent and the Purchaser are soliciting proxies under a
separate proxy statement to authorize the Proposed Control Share Acquisition
pursuant to the Ohio Control Share Acquisition Law (the "Ohio Control Share
Acquisition Approval").
SOLICITATION OF AGENT DESIGNATIONS;
CALLING OF THE SPECIAL MEETING
Parent and the Purchaser are, simultaneously with the solicitation of
proxies for use at the Special Meeting, soliciting, by means of the Solicitation
Statement, Agent Designations to provide for the calling of the Special Meeting.
Under the ORC and the Company Regulations, a special meeting of the Company
shareholders may be called at any time by the holders of at least 40% of the
Shares to be held at such time and such place as such Requisite Holders may set
forth in the Written Request delivered to the Chairman, President or Secretary
of the Company.
On July 18, 1996, the Company announced that the Company's Board had
purported to fix September 3, 1996, as the record date for determining
shareholders entitled to execute Agent Designations for the purpose of calling
the Special Meeting. Parent and the Purchaser believe that the purported setting
of a record date by the Company's Board is a blatant and unlawful attempt by the
Company to take away rights to which you, the shareholders of the Company, are
entitled, so as to prevent Parent's and the Purchaser's acquisition of the
Company and to deny you the right to receive the Offer Price in cash for your
Common Shares. Neither the ORC nor the Company Regulations provide for or make
any reference to the setting of a record date in connection with any action by
shareholders to call a special meeting in the manner specified in the Company
Regulations. Instead, the Company Regulations, in accordance with the ORC,
provide that a special meeting of the Company's shareholders may be called "AT
ANY TIME" by the Requisite Holders, among others. The Company Regulations
provide that, upon receipt of the Written Request by an appropriate officer of
the Company, it shall be the duty of such officer to cause notice of the Special
Meeting to be given to the Company shareholders entitled thereto within five
business days of receipt of the Written Request; provided that, if such officer
fails to cause such notice to be given within such time period, then the
Requisite Holders may give notice of the Special Meeting to the Company
shareholders. Accordingly, following receipt of Agent Designations from
Requisite Holders, the Designated Agents will call the Special Meeting, and
thereupon
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make appropriate delivery to the Chairman and President or to the Secretary of
the Company of the Written Request duly requesting such officer forthwith to
cause appropriate notice of the Special Meeting to be given to the Company
shareholders entitled thereto. If appropriate notice of the Special Meeting is
not so given within five business days of delivery of the Written Request, the
Designated Agents will cause such notice to be given to the Company shareholders
as provided in the Company Regulations.
Under the Company Regulations, the Requisite Holders may in the Written
Request designate the time and place of a special meeting called by them. Parent
and the Purchaser currently intend the Special Meeting to be held as soon as
practicable following receipt of Agent Designations from the Requisite Holders,
subject to the requirements of the ORC and the Company Regulations, and intend
to designate such time for the Special Meeting in the Written Request. Holders
will be given notice of the time and place of the Special Meeting in accordance
with the Company Regulations.
Under the ORC, the Company's Board may fix the Special Meeting Record Date,
which shall not be a date earlier than the date on which it is fixed nor more
than 60 days preceding the date of the Special Meeting. No Special Meeting
Record Date has yet been fixed. In the Written Request, the Designated Agents
will request the Company's Board to fix a Special Meeting Record Date by the
time they cause the Notice of the Special Meeting to be given to the Company's
shareholders. The ORC provides that, if the Company's Board shall fail or
refuse, within such time as the Designated Agents may request, to fix a Special
Meeting Record Date, then the Designated Agents may fix a Special Meeting Record
Date, subject to the limitations described above. The ORC further provides that,
if no Special Meeting Record Date is fixed for determining shareholders entitled
to vote at the Special Meeting, then such record date shall be the date next
preceding the day on which the Special Meeting is held. If the Company's Board
fails or refuses, within the time specified in the Written Request, to fix the
Special Meeting Record Date, then the Designated Agents will fix the Special
Meeting Record Date in compliance with the ORC.
THE GOLD-STRIPED PROXY CARD WILL NOT CONSTITUTE AN AGENT DESIGNATION TO
CALL THE SPECIAL MEETING. STOCKHOLDERS ARE URGED TO PROMPTLY SIGN AND RETURN THE
WHITE AGENT DESIGNATIONS FURNISHED WITH THE SOLICITATION STATEMENT OF PARENT AND
THE PURCHASER AS WELL AS THE GOLD-STRIPED SPECIAL MEETING PROXY AND THE WHITE
OHIO CONTROL SHARE ACQUISITION MEETING PROXY.
The tender of Common Shares pursuant to the Offer does not constitute the
grant to Parent or the Purchaser of any rights to vote with respect to the
tendered Common Shares until such time as such Common Shares are accepted for
payment by the Purchaser. ACCORDINGLY, IT IS IMPORTANT THAT YOU EXECUTE A GOLD-
STRIPED SPECIAL MEETING PROXY EVEN IF YOU TENDER YOUR COMMON SHARES PURSUANT TO
THE OFFER.
If any of your Shares are held in the name of a brokerage firm, bank, bank
nominee or other institution, only it can execute a proxy for such Shares and
will do so only upon receipt of your specific instructions. Accordingly, please
contact the person responsible for your account and instruct that person to
execute the GOLD-STRIPED Special Meeting proxy.
ESOP AND PLAN PARTICIPANTS CAN ONLY VOTE AT THE SPECIAL MEETING WITH
RESPECT TO SHARES HELD IN THE ESOPS OR PLANS ON THEIR BEHALF BY INSTRUCTING THE
ESOP TRUSTEE OR THE PLAN TRUSTEE, AS APPLICABLE, ON THE FORM THAT SHOULD BE
PROVIDED BY THE ESOP TRUSTEE OR THE PLAN TRUSTEE, AS APPLICABLE, TO PARTICIPANTS
FOR THAT PURPOSE. ESOP AND PLAN PARTICIPANTS CANNOT EXECUTE PROXIES WITH RESPECT
TO SHARES ALLOCATED TO THEIR ESOP OR PLAN ACCOUNTS BY EXECUTING THE ACCOMPANYING
GOLD-STRIPED SPECIAL MEETING PROXY.
If the Purchaser should terminate, or materially amend the terms of, the
Offer prior to the Special Meeting, Parent or the Purchaser will disseminate
such information regarding such changes to the Company's shareholders and, in
appropriate circumstances, will provide the Company shareholders with a
reasonable opportunity to revoke their proxies prior to the Special Meeting.
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PROXY PROCEDURES
IN ORDER FOR YOUR VIEWS ON THE SPECIAL MEETING PROPOSALS TO BE REPRESENTED
AT THE SPECIAL MEETING, PLEASE MARK, SIGN AND DATE THE ENCLOSED GOLD-STRIPED
SPECIAL MEETING PROXY CARD AND RETURN IT TO PARENT, C/O MACKENZIE PARTNERS, 156
FIFTH AVENUE, NEW YORK, NEW YORK 10010, IN THE ENCLOSED ENVELOPE IN TIME TO BE
VOTED AT THE SPECIAL MEETING. Execution of the GOLD-STRIPED Special Meeting
proxy card will not affect your right to attend the Special Meeting and to vote
in person.
Only holders of record as of the close of business on the Special Meeting
Record Date will be entitled to vote at the Special Meeting. If you are a
stockholder of record on the Special Meeting Record Date, you will retain your
voting rights for the Special Meeting even if you sell such Shares after the
Special Meeting Record Date or if you tender such Shares pursuant to the Offer,
whether before or after the Special Meeting Record Date. The tender of Shares
pursuant to the Offer does not constitute the grant to the Purchaser of a proxy
or any voting rights with respect to the tendered Shares until such time as such
Shares are accepted for payment by the Purchaser. ACCORDINGLY, IT IS IMPORTANT
THAT YOU VOTE THE SHARES HELD BY YOU ON THE SPECIAL MEETING RECORD DATE OR GRANT
A PROXY TO VOTE SUCH SHARES ON THE GOLD-STRIPED SPECIAL MEETING PROXY CARD, EVEN
IF YOU SELL SUCH SHARES AFTER THE SPECIAL MEETING RECORD DATE OR TENDER SUCH
SHARES PURSUANT TO THE OFFER.
The accompanying GOLD-STRIPED Special Meeting proxy card will be voted at
the Special Meeting in accordance with your instructions on such card. You may
vote FOR or AGAINST or ABSTAIN with respect to each of the Special Meeting
Proposals. With respect to the removal and election of directors, you may vote
FOR removal of all of the incumbent Company directors and the election of all of
the Parent Nominees proposed to replace them at the Special Meeting. You may
also vote FOR removal of less than all of such incumbent Company directors
and/or the election of less than all of the Parent Nominees proposed to replace
them by marking the "FOR" box and writing the name(s) of the person(s) whom you
do not wish to be removed and the name(s) of the person(s) whom you do not wish
to be elected in the space provided on the GOLD-STRIPED Special Meeting proxy
cards. IF NO MARKING IS MADE, YOU WILL BE DEEMED TO HAVE GIVEN A DIRECTION TO
THE PERSONS APPOINTED BY THE PROXIES TO BE SOLICITED BY PARENT AND THE PURCHASER
FOR THE SPECIAL MEETING (THE "PROXY AGENTS") TO VOTE ALL THE SHARES REPRESENTED
BY EACH GOLD-STRIPED SPECIAL MEETING PROXY CARD AT THE SPECIAL MEETING FOR
REMOVAL OF ALL OF THE INCUMBENT COMPANY DIRECTORS AND THE ELECTION OF ALL OF THE
PARENT NOMINEES PROPOSED TO REPLACE THEM AT THE SPECIAL MEETING, AS WELL AS FOR
EACH OF THE OTHER SPECIAL MEETING PROPOSALS.
You may revoke your proxy at any time by executing and delivering a written
revocation to Commercial Intertech Corp., 1775 Logan Avenue, Youngstown, Ohio
44510. Parent and the Purchaser request that you send a copy of any revocation
sent to the Company to United Dominion Industries Limited, 2300 One First Union
Center, Charlotte, North Carolina 28202-6039, c/o B. Bernard Burns, Jr., Senior
Vice President, General Counsel and Secretary. A revocation may be in any
written form, provided that it clearly states that your proxy is no longer
effective. A proxy may also be revoked by notice given to the Company in an open
meeting of the Company shareholders. Any revocation of a proxy will not affect
any action taken by the proxy holders pursuant to such proxy prior to such
revocation. Your presence at a meeting of the Company shareholders will not,
without more, revoke your proxy. ONLY YOUR LATEST DATED GOLD-STRIPED SPECIAL
MEETING PROXY WILL COUNT AT THE SPECIAL MEETING.
SPECIAL MEETING PROPOSALS
At the Special Meeting, Parent and the Purchaser intend to present the
following resolutions for adoption by the Company's shareholders, in the order
set forth below.
First Proposal: Resolution Calling for to Preside at the Special
Meeting
The text of the first resolution proposed by Parent and the Purchaser for
adoption at the Special Meeting by the Company's shareholders reads as follows:
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<PAGE> 9
"RESOLVED, that in accordance with Section 10 of Article I of the Code
of Regulations of the Commercial Intertech Corp. (the "Company"), the
Company's shareholders hereby order that, immediately following the call to
order of the Special Meeting, the Special Meeting and all adjournments
thereof shall be presided over by ."
The Company Regulations permit the shareholders to determine the presiding
officer of the Special Meeting. The Company Regulations further provide that the
order of business at the Special Meeting shall be prescribed by the presiding
officer thereof.
The Proxy Agents will vote all shares represented by such proxies in favor
of adoption of the foregoing resolution. If this resolution is adopted by the
shareholders, ____________ (the "Designated Special Meeting Chairman") intends
to cause the order of business at the Special Meeting to be as set forth in this
Proxy Statement. In accordance with the Company Regulations, adoption of this
resolution requires the affirmative vote of the holders of a majority of the
voting Shares represented and entitled to vote at the Special Meeting.
Second Proposal: Resolution Calling for Redemption of the Rights
The text of the second resolution proposed by Parent and the Purchaser for
adoption at the Special Meeting by the Company's shareholders reads as follows:
"RESOLVED, that the shareholders of the Company call upon the
incumbent members of the Board of Directors of the Company to redeem
immediately, and in any event prior to their removal from office, the
preferred share purchase rights issued pursuant to the Rights Agreement
dated as of November 29, 1989 between the Company and The Mahoning National
Bank of Youngstown (the "Rights Agreement"), or to take other action under
the Rights Agreement that will result in the satisfaction of the Rights
Condition set forth in the Purchaser's Revised Offer to Purchase dated July
16, 1996."
This resolution, if adopted by the shareholders of the Company, will not be
binding on the Company's Board. The Proxy Agents will vote all Shares
represented by each GOLD-STRIPED Special Meeting proxy card in favor of this
resolution. Under the Company Regulations, the affirmative vote of the holders
of a majority of the voting Shares represented and entitled to vote at the
Special Meeting is required to adopt this resolution.
This precatory resolution is intended to send a strong message to the
members of the Company's Board that the Company's shareholders believe that the
fiduciary duties of the members of the Company's Board require that they act
immediately to redeem the Rights or take other action to render the Rights
(including the 180-Day Restrictions (as defined below)) inapplicable to the
Offer, so as to ensure that the Rights Condition to the Offer referred to in the
second resolution is fulfilled. Parent and the Purchaser believe that, being on
notice that Parent and the Purchaser are seeking the approval of this resolution
by the Company's shareholders, the Company's Board should be prepared at the
Special Meeting to take immediate action to fulfill the Rights Condition, if
they shall not already have done so, prior to their removal from office at the
Special Meeting. If the shareholders adopt the resolutions set forth in the
first proposal, Parent and the Purchaser expect that the Designated Special
Meeting Chairman will offer the Company's Board an opportunity to redeem the
Rights prior to the vote on their removal at the Special Meeting. In the event
the Company's Board fails to redeem the Rights or to take other action under the
Rights Agreement to render the Rights inapplicable to the Offer and the Proposed
Merger, as explained below, the Purchaser may be unable or unwilling to purchase
Common Shares in the Offer and/or to consummate the Proposed Merger or the
purchase of Common Shares in the Offer and the consummation of the Proposed
Merger may, due to the 180-day Restrictions described below, be delayed by 180
days from the time nominees of Parent and the Purchaser are elected as directors
of the Company. Thus, assuming Parent and the Purchaser are successful in
obtaining the votes of the requisite majority of the Shares to pass all of the
other Special Meeting Proposals, the likely effect of a refusal by the Company's
Board to take action to fulfill the Rights Condition prior to their removal,
will be to deny to the Company's shareholders the opportunity to receive the
Offer Price in cash for their Shares until six months after the date of the
Special Meeting.
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<PAGE> 10
According to the Company 1995 10-K/A and the Company's Registration
Statement on Form 8-A dated November 30, 1989 (the "Form 8-A"), in November 1989
the Company adopted the Rights Agreement and declared a dividend of one Right
for each outstanding Common Share. The 1995 10-K states that each Right entitles
the registered holder thereof to purchase one one-hundredth of a Series A
Participating Preferred Share at a purchase price of $75, subject to adjustment,
and that the Rights will become operative in the event that certain events
occur. A more detailed description of the Rights is contained in the Offer to
Purchase.
According to the Form 8-A, the Rights Agreement provides that, until the
close of business on the Distribution Date (as defined below), the Rights will
be evidenced by the certificates for Common Shares. Until the Distribution Date
(or earlier redemption or expiration of the Rights), the surrender for transfer
of any certificates for Common Shares will also constitute the surrender for
transfer of the Rights associated with the Common Shares represented by such
certificates. The Rights Agreement further provides that, as soon as practicable
following the Distribution Date, separate certificates representing the Rights
are to be mailed by the Company or the rights agent to holders of record of
Common Shares as of the close of business on the Distribution Date. The Rights
will separate from the Common Shares and a "Distribution Date" for the Rights
will occur upon the earlier to occur of (i) a public announcement that, without
the prior approval of the Company, a person or group of affiliated or associated
persons has acquired, or obtained the right to acquire, beneficial ownership of
securities having 20% or more of the voting power of all outstanding voting
securities of the Company (an "Acquiring Person") or (ii) ten business days
(unless such date is extended by the Company's Board) following the commencement
of (or a public announcement of an intention to make) a tender offer or exchange
offer which would result in any person or group of related persons becoming an
Acquiring Person.
Based on publicly available information, Parent and the Purchaser believe
that, as of the date hereof, the Rights are not exercisable, certificates for
Rights have not been issued and the Rights are evidenced by the certificates for
Common Shares. Parent and the Purchaser believe that, as a result of the
Purchaser's commencement of the Original Offer on July 12, 1996, the
Distribution Date could have occurred as early as July 26, 1996. In its press
release of July 18, 1996, the Company announced that, on July 17, 1996, the
Company's Board had acted to delay the Distribution Date until either (i) the
close of business on August 7, 1996, or (ii) such earlier date prior to the
expiration date of the Offer as the Company's Board, or any duly authorized
committee thereof, shall designate. Accordingly, Parent and the Purchaser
believe that the Distribution Date will occur no later than August 7, 1996,
unless prior to such date the Company's Board defers the Distribution Date,
redeems the Rights or amends the Rights Agreement to make the Rights
inapplicable to the Offer and the Proposed Merger. Based on the Form 8-A, Parent
and the Purchaser expect that each of them would become Acquiring Persons in the
event the Purchaser were to purchase Common Shares representing 20% or more of
the voting power of the Company's outstanding voting securities in the Offer.
According to the Form 8-A, the Rights Agreement provides that, at any time
prior to the close of business on the earlier of (i) the date that an Acquiring
Person becomes such and (ii) November 29, 1999, the Company's Board may redeem
(except as provided in the Rights Agreement) the Rights in whole, but not in
part, at a price of $.01 per Right.
According to the Form 8-A, the Rights Agreement further provides that, in
the event that a majority of the Company's Board is comprised of (i) persons
elected at a meeting of stockholders or by stockholder action by written consent
who were not nominated by the Company's Board in office immediately prior to
such meeting or action by written consent and/or (ii) successors of such persons
elected to the Company's Board for the purpose of either facilitating a
transaction with an Interested Person (as defined therein) or circumventing
directly or indirectly the provisions of the Rights Agreement, then for a period
of 180 days following the effectiveness of such action, (a) the Rights may not
be redeemed if such redemption is reasonably likely to have the purpose of
facilitating a transaction with an Interested Person or if during such 180-day
period, the Company enters into any agreement reasonably likely to facilitate a
transaction with an Interested Person and the redemption is reasonably likely to
facilitate such a transaction, (b) the Rights Agreement may not be amended or
supplemented in any manner reasonably likely to have the purpose or effect of
facilitating certain business combination transactions with an Interested Person
or (c) the Company
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<PAGE> 11
may not exclude from the definition of an Acquiring Person any Interested Person
who acquires 20% or more of the outstanding Common Stock or deem any offer by an
Interested Person to be a Permitted Offer (as defined in the Rights Agreement
(the "180-Day Restrictions"). Accordingly, the Purchaser may be unable or
unwilling to purchase Common Shares in the Offer and Parent and the Purchaser
may be unable or unwilling to consummate the Proposed Merger for a period of 180
days following the election of the Parent Nominees to the Company's Board unless
the persons constituting the current Board of Directors of the Company redeem
the Rights (or amend the Rights Agreement or take other action under the Rights
Agreement to make the Rights and/or the 180-Day Restrictions inapplicable to the
Offer and the Proposed Merger). This 180-day waiting period would take effect
even if the persons constituting the current Board of Directors of the Company
were removed, and the new board of directors consisting of the Parent Nominees
(the "New Board") were elected, at the Special Meeting and the New Board
thereafter voted to redeem the Rights.
Parent and the Purchaser believe that, under the circumstances of the
Offer, and under applicable law, each of the members of the Company's Board has
a fiduciary obligation to redeem the Rights (or to amend or take other action
under the Rights Agreement to make the Rights and the 180-Day Restrictions
inapplicable to the Offer and the Proposed Merger), and Parent and the Purchaser
have requested that the Company's Board do so.
Parent and the Purchaser commenced an action (the "Ohio Action") against
the Company and its directors on July 11, 1996 in The United States District
Court for the Southern District of Ohio, Eastern Division (the "Ohio Federal
District Court"), seeking, among other things, an order requiring the Company's
Board to redeem the Rights. See "CERTAIN LEGAL MATTERS" below.
Third Proposal: Resolution Calling for Removal of All Current Directors and
Reduction of the Size of the Company's Board
The text of the third resolution proposed by Parent and the Purchaser for
adoption at the Special Meeting by the Company's shareholders reads as follows:
"RESOLVED, that all of the directors of the Company be and hereby are
removed from such office, effective immediately, and that the Code of
Regulations of the Company be amended, effective immediately, to delete
Sections 1 and 2 of Article II of the Code of Regulations in their entirety
and replace such Sections with the following language:
"SECTION 1. Number. Until changed in accordance with the
provisions of Section 2 hereof, the board of directors of the
corporation shall consist of three (3) directors.
SECTION 2. Election and Term. Each director shall hold
office until the next annual meeting of shareholders and until
his or her successor is elected, or until his or her earlier
resignation, removal from office, or death. The election of
directors shall, if the number of persons nominated shall be
greater than the number of directorships to be filled, be by
ballot.
The number of directors may be increased or decreased
(subject to the condition that in no event shall the number of
directors be less than three (3)), by resolution adopted by
shareholders entitled to exercise a majority of the voting power
on such proposal present in person or by proxy at any annual
meeting or at any special meeting called for that purpose,
provided that no decrease in the number of directors shall of
itself have the effect of shortening the term of any incumbent
director.
The board of directors may adopt such further regulations
governing the elections of directors, not inconsistent with the
foregoing, as shall to the board seem proper and expedient."
The Proxy Agents will vote all Shares represented by each GOLD-STRIPED
Special Meeting proxy card in favor of the resolution to remove all of the
incumbent directors of the Company and to amend the Company Regulations to
reduce the size of the Company's Board. Because the ORC provides that, if a
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<PAGE> 12
company's board of direcors is divided into classes, each class must have at
least three directors, a reduction in the size of the Company's Board also
requires that the Company's Board no longer be divided into classes. Approval of
this resolution requires the affirmative vote of a majority of the total voting
power of the outstanding Shares.
According to publicly available information, there are currently 12 members
of the Company's Board: William J. Bresnahan, Charles B. Cushwa III, William W.
Cushwa, John M. Galvin, Richard J. Hill, William E. Kassling, Neil D. Humphrey,
Gerald C. McDonough, C. Edward Midgley, Paul J. Powers, George M. Smart and Don
E. Tucker. However, there can be no assurance that prior to the Special Meeting
one or more of such incumbent Company directors will not have ceased to be a
director (by reason of resignation or otherwise) and have been succeeded by
another person appointed by the remaining members of the Company's Board or that
the number of members of the Company's Board will not have been increased.
Accordingly, the GOLD-STRIPED Special Meeting proxy card which is solicited
hereby provides for the removal as directors of all persons who are serving as
directors at the time that the removal becomes effective.
Fourth Proposal: Resolution Calling for the Amendment of the Company Regulations
to Opt Out of the Ohio Control Share Acquisition Statute
The text of the fourth resolution proposed by Parent and the Purchaser for
adoption at the Special Meeting by the Company's shareholders reads as follows:
"RESOLVED, that a new Article XI shall be added to the Company
Regulations reading in its entirety as follows:
"ARTICLE XI
"CONTROL SHARE ACQUISITION STATUTE NOT APPLICABLE
"Section 1701.831 of the Ohio Revised Code does not apply to
'control share acquisitions' (as such term is defined in division
(Z)(1) of Section 1701.01 of the Ohio Revised Code) of shares of
the corporation."
The amendment to the Company Regulations set forth above shall be moot if
the Ohio Control Share Acquisition Approval has been obtained or if Parent and
the Purchaser are otherwise satisfied, in their sole discretion, that the Ohio
Control Share Acquisition Law is invalid or inapplicable to the acquisition of
Common Shares pursuant to the Offer by the date of the Special Meeting.
The Proxy Agents will vote all Shares represented by each GOLD-STRIPED
Special Meeting proxy card in favor of the resolution to amend the Company
Regulations as set forth above. The Company Regulations require the affirmative
vote of a majority of the total voting power of the outstanding Shares to
approve amendments to the Company Regulations.
Fifth Proposal: Election of Directors
Parent and the Purchaser intend to propose at the Special Meeting that,
following the removal of all incumbent directors of the Company from office and
the reduction of the size of the Company's Board to three directors of one
class, the shareholders of the Company elect the three Parent Nominees named
below as directors of the Company to fill the vacancies created by the removal
of such incumbent directors and such reduction in the size of the Company's
Board. In the event the election of directors is not by cumulative voting, a
majority of the Shares represented and entitled to vote at the Special Meeting
shall be sufficient to elect the Parent Nominees.
The ORC provides for cumulative voting for the election of directors if any
shareholder gives notice in writing to the President, a Vice President or the
Secretary of the Company, not less than 48 hours (unless notice of the meeting
has not been given at least ten days before the date fixed for the meeting, in
which case 24 hours) before the time fixed for holding the meeting that such
shareholder desires that the voting for the election of directors shall be
cumulative, provided that announcement of the giving of such notice is made
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<PAGE> 13
upon the convening of the meeting by the Chairman or the Secretary of the
Company or by or on behalf of such shareholder. Each shareholder shall then have
the right to vote his or her Shares cumulatively at the election; that is, each
shareholder shall be entitled to cast a number of votes as shall equal the
number of votes represented by such shareholder's Shares on the Special Meeting
Record Date multiplied by the number of directors to be elected. A shareholder
may cast all such cumulative votes for a single nominee or may allocate them
among as many nominees as that shareholder sees fit. The three nominees with the
highest number of votes shall then be elected as directors.
Accordingly, assuming the Company's Board then consists of three members,
in order to elect all the Parent Nominees to the Company's Board, Parent and the
Purchaser will need to receive proxies or votes at the Special Meeting with
respect to 75% of the number of Shares represented and voting at the Special
Meeting, and in order to elect a majority of the Company's Board, Parent and the
Purchaser will need proxies or votes from 50% of the number of Shares
represented and voting at the Special Meeting.
The text of the fifth resolution proposed by Parent and the Purchaser for
adoption at the Special Meeting by the Company's shareholders will depend upon
whether the election of directors to fill the vacancies created by the removal
of the Company's incumbent directors and the reduction in the size of the
Company's Board shall be by cumulative voting, as determined in accordance with
the ORC and the Company Regulations.
In the event the election of directors at the Special Meeting is not to be
by cumulative voting, the text of the fifth resolution proposed by Parent and
the Purchaser for adoption at the Special Meeting by the Company's shareholders
will read as follows:
"RESOLVED, that the shareholders of the Company hereby elect NOMINEE
I, NOMINEE II and NOMINEE III as directors of the Company."
In the event the election of directors at the Special Meeting is to be by
cumulative voting, the text of the fifth resolution proposed by Parent and the
Purchaser for adoption at the Special Meeting by the Company's shareholders will
read as follows:
"RESOLVED, that the shareholders of the Company hereby elect as
directors of the Company the three persons among all persons nominated for
election as a director of the Company who receive the first, second and
third highest number of votes cast in the aggregate."
In the event the election of directors at the Special Meeting is to be
governed by cumulative voting, the Proxy Agents intend to cast the votes
represented by all GOLD-STRIPED Special Meeting proxies held by the Proxy Agents
(the "Parent Votes") as follows: in the event the total number of Parent Votes
represents less than 25% of the aggregate number of votes represented by all
outstanding Shares (the "Total Votes"), then all of the Parent Votes will be
voted in favor of the election of NOMINEE I; in the event the total number of
Parent Votes represents more than 25% but less than 50% of the aggregate number
of Total Votes, then Parent votes representing 25.1% of the Total Votes will be
voted in favor of the election of NOMINEE I and the remaining Parent Votes will
be voted in favor of the election of NOMINEE II; in the event the total number
of Parent Votes represents more than 50% but less than 75% of the aggregate
number of Total Votes, then Parent Votes representing 25.1% of the Total Votes
will be voted in favor of the election of NOMINEE I, Parent votes representing
25.1% of the Total Votes will be voted in favor of the election of NOMINEE II
and the remaining Parent Votes will be voted in favor of the election of NOMINEE
III; and, in the event the total number of Parent Votes represents more than 75%
of the aggregate number of Total Votes, Parent Votes will be divided evenly
among the Parent Nominees, all of whom will be elected to the Company's Board.
If the Proxy Agents shall determine in their discretion that an alternative
allocation of the Parent Votes would result in a greater likelihood that more
Parent Nominees would be elected, then the Proxy Agents may vary the allocation
described above accordingly. The voting arrangements described above are
referred to in the attached GOLD-STRIPED Special Meeting proxy card as the
"Optimal Parent Voting Arrangement."
The Parent Nominees have furnished the following information concerning
their principal occupations or employment and certain other matters. Each Parent
Nominee, if elected, would hold office until the
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<PAGE> 14
Company's Annual Meeting of Shareholders in 1997, and until a successor has been
elected and qualified, or until death, resignation or removal.
PARENT NOMINEES
<TABLE>
<CAPTION>
NAME, AGE AND PRINCIPAL OCCUPATION AND BUSINESS
PRINCIPAL BUSINESS ADDRESS EXPERIENCE DURING LAST FIVE YEARS
- --------------------------------------------- --------------------------------------------
<S> <C>
NOMINEE I....................................
NOMINEE II...................................
NOMINEE III..................................
</TABLE>
Each of the Parent Nominees has consented to serve as a director of the
Company, if elected. Parent does not expect that any of the Parent Nominees will
be unable to stand for election, but in the event that any vacancy in Parent's
slate of nominees should occur, Shares represented by [COLOR] Special Meeting
proxy cards held by the Proxy Agents will be voted at the Special Meeting for
the remaining Parent Nominees.
If elected as a director of the Company, each Parent Nominee would receive
an annual fee and an appropriate fee for each meeting of the Company's Board
attended, in accordance with the policies of the Company. [In addition, as
compensation for being a Parent Nominee, Parent has agreed to pay each Parent
Nominee $ .] In addition, Parent has agreed to indemnify the Parent
Nominees against certain claims, damages and expenses arising from their
standing for election at the Special Meeting and, if elected, for serving as
directors of the Company following their election.
AS INDICATED ABOVE, IF ELECTED AT THE SPECIAL MEETING, THE PARENT NOMINEES
WILL, SUBJECT TO THEIR FIDUCIARY DUTIES, SEEK TO GIVE ALL SHAREHOLDERS THE
OPPORTUNITY TO ACCEPT THE PURCHASER'S OFFER. ACCORDINGLY, A VOTE FOR THE PARENT
NOMINEES WILL ENHANCE YOUR CHANCES OF BEING ABLE TO TAKE ADVANTAGE OF THE OFFER.
PARENT STRONGLY RECOMMENDS A VOTE FOR REMOVAL OF THE INCUMBENT DIRECTORS OF
THE COMPANY AND THE ELECTION OF THE PARENT NOMINEES.
Sixth Proposal: Resolution Calling for the Recess of Special Meeting
The text of the sixth resolution proposed by Parent and the Purchaser for
adoption at the Special Meeting by the Company's shareholders reads as follows:
"RESOLVED, that this Special Meeting be recessed for one hour, or for
such other reasonable period of time as it shall take the duly appointed
inspectors of election for this Special Meeting (the "Inspectors") to
determine the results of the votes heretofore taken at this Special Meeting
in accordance with their obligations pursuant to Section 1701.50(C) of the
Ohio Revised Code; and that this Special Meeting shall be resumed as
promptly as practicable after the announcement by the Inspectors of the
results of such votes."
The recess will operate as an intermission within the Special Meeting and
will not end the Special Meeting or destroy its continuity as a single gathering
and after which the Special Meeting will be immediately resumed, all in
accordance with Robert's Rules of Order to which the Company Regulations refer
for parliamentary questions not otherwise provided in the Company Regulations.
The purpose of the proposed recess is to give the inspectors of election for the
Special Meeting an opportunity to confirm the results of the election of the
Company's Board, so as to enable the newly elected Company's Board, assuming it
meets the standards set forth in Article SIXTH of the Company Articles and
subject to its fiduciary obligations, to recommend unanimously the repeal of
said Article SIXTH to the Company's shareholders, as described below. Subject to
their fiduciary obligations, the Parent Nominees, if elected, expect to report
such unanimous recommendation to the Company's shareholders at the resumption of
the Special Meeting and prior to the vote of shareholders on the Seventh
Proposal described below.
Parent and the Purchaser believe that, if at the Special Meeting the
Designated Special Meeting Chairman has been elected to preside as chairman of
the Special Meeting, the Designated Special Meeting Chairman would be able to
recess the Special Meeting without the vote of the Company's shareholders.
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<PAGE> 15
However, in order to eliminate any question as to the validity of such action,
Parent and the Purchaser are presenting this resolution to Company shareholders
for their approval. The Proxy Agents will, if required, vote all Shares
represented by such proxies in favor of the resolution to recess the Special
Meeting. Under the Company Regulations, adoption of this resolution requires the
affirmative vote of a majority of the voting Shares represented and entitled to
vote at the Special Meeting.
Seventh Proposal: Resolution Calling for the Amendment of the Company Articles
The text of the seventh resolution proposed by Parent and the Purchaser for
adoption at the Special Meeting by the Company's shareholders reads as follows:
"RESOLVED, that, if such amendment is unanimously recommended by the
Company's Board of Directors, the Amended Articles of Incorporation of the
Company be amended, effective immediately, to delete Article SIXTH thereof
in its entirety."
Article SIXTH of the Company Articles ("Article SIXTH") provides that the
affirmative vote of holders of 95% of all shares of stock of the Company
entitled to vote in the election of directors shall be required to authorize a
business combination (as defined in the Company Articles) with any entity that,
directly or indirectly, beneficially owns 30% or more of the Shares as of the
record date for the meeting of shareholders at which such authorization is
sought unless the consideration to be offered to holders of the outstanding
Shares complies with certain specified provisions (the "Article SIXTH
Requirements"). Consequently, to ensure that all of the conditions to Parent's
and the Purchaser's ability and willingness to consummate the Offer and the
Proposed Merger have been or will be satisfied, Parent proposes that the Company
Articles be amended to repeal Article SIXTH in its entirety.
Article SIXTH may be amended or repealed only by the affirmative vote of
95% of all shares of stock of the Company entitled to vote in the election of
directors, or by the affirmative vote of at least two-thirds of the outstanding
Shares upon the unanimous recommendation of the Company's Board provided that
all of the directors qualify as "continuing directors" at the time such
recommendation is made. "Continuing director" is defined to include directors
holding office prior to the time that any entity proposing a business
combination has acquired 10% or more of the outstanding stock of the Company.
Because the Special Meeting will occur prior to the time the Purchaser purchases
Common Shares in the Offer, the Parent Nominees, if elected at the Special
Meeting, will qualify as "continuing directors" for purposes of Article SIXTH.
Parent and the Purchaser have requested that the Company's Board
unanimously recommend to the Company's shareholders that Article SIXTH be
repealed or otherwise amended such that its provisions are inapplicable to the
Proposed Merger. There can be no assurance that the Company's Board will do so.
In the event that the Company's Board fails to do so prior to the effective time
of their removal at the Special Meeting, the Purchaser expects the Parent
Nominees, if all of such persons are elected at the Special Meeting, and subject
to their fiduciary duties, to take such appropriate action as shall result in a
unanimous recommendation by the Company's Board to the Company's shareholders
that Article SIXTH be repealed. In the event such recommendation is made, the
Proxy Agents will vote all Shares represented by each GOLD-STRIPED Special
Meeting proxy card in favor of the resolution to repeal Article SIXTH in its
entirety. Pursuant to Article SIXTH and the ORC, under such circumstances, the
affirmative vote of holders of two-thirds of the voting power of the total
number of outstanding Shares shall be sufficient to approve the proposal to
repeal Article SIXTH.
Eighth Proposal: Resolution Calling for the Adjournment of the Special Meeting
The text of the eighth resolution proposed by Parent and the Purchaser for
adoption at the Special Meeting by the Company's shareholders reads as follows:
"RESOLVED, that the Special Meeting may be adjourned at such time and
for such purposes as the Proxy Agents may determine."
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<PAGE> 16
This resolution would give Parent and the Purchaser authority to initiate
and vote for a proposal to adjourn the Special Meeting at any time and for any
reason, including to allow the solicitation of additional votes, if necessary,
to approve the Special Meeting Proposals.
IF EACH OF THE SPECIAL MEETING PROPOSALS IS NOT APPROVED BY THE COMPANY
SHAREHOLDERS, IT IS UNLIKELY THAT CERTAIN CONDITIONS TO THE OFFER WILL BE
SATISFIED AND THAT COMMON SHARES WILL BE ACCEPTED FOR PAYMENT PURSUANT TO THE
OFFER. IN SUCH EVENT, PARENT AND THE PURCHASER MAY EITHER (I) TERMINATE THE
OFFER OR (II) CONTINUE TO PURSUE THE OFFER AND THE SATISFACTION OF THE
CONDITIONS TO THE OFFER THROUGH NEGOTIATION, LITIGATION AND OTHER MEANS. SEE
"TERMS AND CONDITIONS OF THE OFFER" AND "CERTAIN LEGAL MATTERS" BELOW.
VOTING AT THE SPECIAL MEETING
Subject to the provisions for cumulative voting in the election of
directors, as described above, each Share is entitled to one vote on all matters
brought before the Company's shareholders for a vote. According to the Annual
Meeting Proxy Statement and other documents publicly filed by the Company under
the Securities Exchange Act of 1934, as amended (the "Exchange Act"), prior to
the filing of the Company 1995 10-K/A, the Common Shares and the Preferred
Shares voted together as a single class, with each Common Share entitled to one
vote and each Preferred Share entitled to one and one-half votes. However, in
the Ohio Action and in the recently filed Company 1995 10-K/A, the Company
admitted that the Preferred Shares are entitled to only one vote per share.
Accordingly, Parent and the Purchaser believe that, in any shareholder vote in
which the Common Shares and Preferred Shares vote together as a single class,
the Preferred Shares are entitled to one vote per share notwithstanding the fact
that since September 1994 all votes of the Company's shareholders have
erroneously been tabulated on the basis of one and one-half votes per Preferred
Share. See "CERTAIN LEGAL MATTERS" below.
As described above in the "INTRODUCTION," the ESOP Trusts contain certain
pass-through voting provisions. Parent and the Purchaser believe that,
notwithstanding the express terms of the trust documents, the ESOP Trustee has a
fiduciary duty under the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), to exercise its discretion with respect to voting Shares held
in the ESOPs which are allocated to a participant's account but for which no
instructions are received by it and for all Shares held in the ESOP which are
not allocated to a participant's account. Parent and the Purchaser also believe
that the indemnification provisions in favor of the ESOP Trustee contained in
the ESOP trust documents, which provide full indemnification for the Trustee
only for actions taken upon the written direction of the participants and in
accordance with the terms of the ESOPs, violate ERISA. The United States
Department of Labor (the "DOL") has successfully advanced similar positions in a
federal district court case, which is currently on appeal, arising out of a
tender offer in which the target company's employee stock ownership plan
provided that tendering decisions were to be passed-through to participants with
respect both to allocated and unallocated shares, and that a failure to direct
by a participant should be interpreted by the trustee as an instruction not to
tender. The court in Reich v. NationsBank of Georgia, N.A. concluded that it is
not appropriate for participants in an employee stock ownership plan to make
tendering decisions with respect to unallocated shares (due to "an inherent
conflict of interest"). The court also stated that "when a trustee receives no
affirmative direction regarding allocated shares, the trustee must take
exclusive responsibility for decisions regarding these shares." (Moreover, the
DOL has taken the position that, under the fiduciary requirements of ERISA, a
trustee of an employee stock ownership plan must override participant
instructions if following them would be imprudent.) In Martin v. NationsBank of
Georgia, N.A., an earlier opinion in the same federal district court proceeding,
the court granted partial summary judgment to the DOL on its claim that
indemnification rights in favor of a trustee of an employee stock ownership plan
that differed depending on whether or not the trustee followed participant
voting and tendering instructions violated ERISA. The court stated that the
indemnification agreement, which created "a financial incentive for the trustee
to breach its fiduciary obligations under ERISA," compromised the trustee's
independent judgment and thus violated ERISA.
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<PAGE> 17
As also described above in the "INTRODUCTION," the Plan Trusts contain
pass-through voting provisions for the participants of the Plans, with Common
Shares that are allocated to a participant's account voted by the Plan Trustee
as instructed by the participant and Common Shares that either are not allocated
to any participant's account or are allocated but for which no instruction from
the participant has been received by the Plan Trustee voted by the Plan Trustee,
in its sole discretion.
Proxies representing Common Shares held of record will include Common
Shares allocated to participants under the Dividend Reinvestment Plan for
shareholders of the Company. The GOLD-STRIPED Special Meeting proxy accompanying
this Proxy Statement can be used to vote such Common Shares held under the
Dividend Reinvestment Plan.
BACKGROUND OF THE PROPOSED ACQUISITION
Parent continuously seeks to strengthen its business segments by adding new
products, including through acquisitions, particularly of manufacturing
businesses producing proprietary engineered products. The Company's planning and
development department has for several years included the Company among a number
of companies that it follows as potential combination prospects. Also, beginning
in late 1995, Parent, based on public information and with the assistance of
Schroder Wertheim & Co. Incorporated ("Schroder Wertheim"), Parent's financial
advisor, began analyzing the potential attractiveness of a possible acquisition
of the Company. Based on this analysis, senior management of Parent determined
to contact the Company to assess its receptiveness to a potential combination of
the Company and Parent.
On May 10, 1996, Mr. William R. Holland, Chairman and Chief Executive
Officer of Parent, met with Mr. Paul J. Powers, Chairman, President and Chief
Executive Officer of the Company, at Mr. Holland's request. At that meeting, Mr.
Holland discussed the benefits of a combination of Parent and the Company and
proposed a transaction in which Parent would acquire all of the Shares at a
price of $24.00 per Common Share. Mr. Powers responded that he was not
interested in considering a transaction between the Company and Parent.
Thereafter, on or about June 17, 1996, a representative of Schroder
Wertheim received a telephone call from a representative of the Company stating
that the Company was considering an initial public offering of 20% of the common
stock of Cuno Incorporated, a wholly-owned subsidiary of the Company ("Cuno").
The Company representative asked if Schroder Wertheim was interested in learning
further about Cuno and potentially participating as a co-manager in such an
offering. The representative of Schroder Wertheim replied that Schroder Wertheim
had no such interest.
On June 27, Mr. Holland sent the following letter to Mr. Powers:
Mr. Paul J. Powers
Chairman, President and
Chief Executive Officer
Commercial Intertech Corporation
1775 Logan Avenue
Youngstown, OH 44505
Dear Paul:
I enjoyed our meeting on May 10 and appreciated your time and
hospitality. I have been pondering the situation since then and would
certainly like to see our discussions proceed further. I was disappointed
that you did not share my desire to move forward. I am convinced that the
combination of our two companies would make an extremely strong industrial
enterprise.
Accordingly, United Dominion Industries is offering to acquire
Commercial Intertech pursuant to a negotiated merger transaction in which
your shareholders would receive $27.00 per share in cash for all common
shares of Commercial Intertech, or approximately $500 million in total
consideration, including assumption of debt. This price represents
approximately a 40% premium to Commercial Intertech's
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<PAGE> 18
current share price. Given United Dominion's strong financial condition,
the proposed transaction would not be subject to a financing condition and
we do not anticipate any anti-trust problems.
We believe that this is a full and fair price that presents an
attractive opportunity for the shareholders of Commercial Intertech. We
obviously would honor outstanding commitments to your employees and would
be pleased to discuss in depth how our companies could best be combined.
As you know, United Dominion does about $2 billion in sales--all in
manufacturing--and earned $77.3 million in 1995. We have a balance sheet
that is about 25% leveraged and have significant financial resources
available to us. We have enjoyed an excellent record of growth the last
five years and have returned, over that time, about a 24% compounded annual
return to our shareholders.
Some of the features of the combined company would be:
- Astron and Varco-Pruden would create one of the largest and strongest
metal building companies in the world, with sales of approximately $450
million, capturing the benefits of geographical reach and substantial
synergies;
- Cuno and Flair would, in our judgment, likewise create significant
synergies. This combination would create an operation doing approximately
$450 million in sales, making it one of the largest filtration businesses
in the world; and
- Our compaction operations (Bomag and Hypac) use approximately $50 million
a year in hydraulics. I would expect that these units would become a
significant customer of your hydraulics operation.
In short, Paul, we believe that the combination of United Dominion and
Commercial Intertech (with sales exceeding $2.5 billion) would produce a
strong company with a bright future.
As our preference is to consummate a negotiated transaction, we would
be pleased to advance our discussions at the earliest practicable time
after you have had an opportunity to discuss this offer with your
directors.
We are experienced in acquiring manufacturing companies and, with our
advisors, we can bring the transaction to a speedy conclusion.
Sincerely,
W.R. Holland
WRH/es
cc: Board of Directors
Commercial Intertech
Also on June 27, 1996, Parent issued a press release announcing its
delivery of the above letter and setting forth the full text thereof. Shortly
before the issuance of Parent's announcement on June 27, 1996, Mr. Holland
telephoned Mr. Powers to apprise him of the announcement. However, Mr. Powers
was unavailable and did not return the telephone call.
On June 30, 1996, the Company issued the following press release:
FOR IMMEDIATE RELEASE
COMMERCIAL INTERTECH RESPONDS TO
UNITED DOMINION UNSOLICITED TAKEOVER BID
Youngstown, Ohio: June 30, 1996--Commercial Intertech Corp. (NYSE:
TEC) said today that the proposal received on June 27, 1996 from
Canadian-based United Dominion Industries, Ltd. to acquire the Company was
unsolicited, that it represents a unilateral effort by United Dominion and,
contrary to the suggestion in United Dominion's letter, did not arise out
of any negotiations between the companies.
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<PAGE> 19
The Board of Directors of Commercial Intertech, at an initial meeting
on June 29, 1996, reaffirmed the Company's long-standing objective of
creating shareholder value as an independent public company and noted that
the Company achieved record financial performance in fiscal 1995. The Board
also indicated that it will review the United Dominion proposal in
consultation with its legal and investment advisers.
As part of its ongoing strategic plans to enhance shareholder value,
the Company is preparing a public offering of up to 20% of the stock of
Cuno Incorporated, its wholly-owned filtration subsidiary. In that
connection, Mr. Paul J. Powers, Chairman of Commercial Intertech Corp.,
noted that Schroder Wertheim, United Dominion's financial adviser, had been
aware of the confidentially-proposed Cuno stock offering, having been
offered the opportunity of participating as co-manager within the last two
weeks.
Also, as part of its strategic plan, on June 28, Commercial Intertech
acquired Component Engineering Company, a manufacturer of cartridge-type
hydraulic valves based in Chanhassen, Minnesota.
Commercial Intertech is a multi-national manufacturer of Hydraulic
Systems, Building Systems and Metal Products, and Fluid Purification.
Employing more than 4,000 men and women around the world, the Company has
35 manufacturing facilities in 10 countries.
On July 3, 1996, Parent acquired 1,000 Common Shares at a price of $27.00
per share in cash on the open market on the NYSE (500 of which were later
contributed to the Purchaser).
On July 10, 1996, as a result of a meeting between the respective financial
advisors of Parent and the Company, Mr. Holland placed a call to Mr. Powers,
which call Mr. Powers returned later that day. During the call, Mr. Holland
indicated to Mr. Powers that he hoped the call could be productive and that the
two could get together once again to discuss a possible transaction. Mr. Powers
replied that the Company would have no response to Parent's proposal until the
Company's Board met and, therefore, there was no reason to have a meeting. He
did not indicate when the meeting of the Company's Board would be held.
On July 11, 1996, the Board of Directors of Parent approved the
commencement of the transactions contemplated herein and Parent announced that
it would be commencing the Original Offer. In addition, Parent also said that it
intends to acquire in the Proposed Merger any Common Shares not purchased in
such offer. Also on July 11, 1996, Parent and the Purchaser commenced the Ohio
Action in the Ohio Federal District Court against the Company and its directors,
among others. See "CERTAIN LEGAL MATTERS" below.
On July 12, 1996, the Purchaser commenced the Original Offer. Also on that
date, Parent and the Purchaser (i) delivered an "acquiring person statement" to
the Company under the ORC, (ii) initiated the process to commence a solicitation
of Agent Designations to call the Special Meeting, (iii) commenced litigation
against the Company and its directors, among others (see "CERTAIN LEGAL MATTERS"
below), and (iv) requested the Company's shareholder list and security position
listings and other information pursuant to the federal securities laws and the
ORC.
On July 12, 1996, after the announcement by Parent and the Purchaser of the
commencement of the Original Offer, the Company issued a press release in which
it stated, among other things, that the Company's Board had determined to
recommend that shareholders reject as inadequate the Original Offer, and had
"reaffirmed the Company's strategic plan which now includes an accelerated
initiative to spin off to shareholders 100% of its wholly owned Cuno
Incorporated filtration subsidiary" (the "Spin-Off"). In addition, the press
release stated that implementation of the Spin-Off was subject to customary
conditions, including receipt of a legal opinion regarding the tax-free nature
of the Spin-Off, and also stated that the Company's Board had approved a program
to repurchase up to 2.5 million of its 15.5 million Common Shares currently
outstanding (the "Repurchase Program").
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<PAGE> 20
Thereafter, on July 12, 1996, Parent issued the following press release:
FOR IMMEDIATE RELEASE
UNITED DOMINION RESPONDS TO COMMERCIAL
INTERTECH'S REJECTION OF ITS TENDER OFFER,
REMAINS COMMITTED TO COMBINATION OF THE COMPANIES
CHARLOTTE, NC (July 12, 1996) -- United Dominion Industries (NYSE,
TSE: UDI), said it is disappointed that directors of Commercial Intertech,
Corp. (NYSE: TEC) have rejected its $27 per share tender offer for all
outstanding common shares of Commercial Intertech and that it will evaluate
all alternatives that would enable it to complete the acquisition.
United Dominion said that it continues to believe that a negotiated
transaction provides substantially more value and less risk for all
Commercial Intertech shareholders than the actions announced today by TEC
directors. United Dominion also reaffirmed its commitment to pursuing the
combination of the two companies.
Following the close of trading on the NYSE on July 12, 1996, the Company
filed the Schedule 14D-9 in which it set forth the recommendation of the
Company's Board in respect of the Original Offer. The Schedule 14D-9 also
disclosed open market purchases by the Company of 847,600 Common Shares during
that day (at an average purchase price of $28.62 per Common Share) and disclosed
for the first time "some risk" that certain future events could cause the
Spin-Off not to be tax-free.
On July 15, 1996, Parent and the Purchaser announced the amendment of the
Original Offer to increase the price to be paid pursuant to the Offer from $27
to $30 per Common Share (and associated Right) as set forth in the following
press release:
FOR IMMEDIATE RELEASE
UNITED DOMINION INCREASES OFFER FOR
COMMERCIAL INTERTECH COMMON STOCK
TO $30 PER SHARE
CHARLOTTE, NC (July 15, 1996) -- United Dominion Industries (NYSE,
TSE: UDI), today announced that it has increased the price to be paid
pursuant to its cash tender offer for all outstanding common shares,
including associated preferred share purchase rights, of Commercial
Intertech Corp. (NYSE: TEC) from $27 to $30 per share, or approximately 57
percent more than TEC's share closing price on June 27 when United Dominion
first publicly announced its acquisition proposal. Including the assumption
of TEC debt, the aggregate transaction value of the revised offer is now
approximately $550 million.
United Dominion also responded to the plan announced Friday by
Commercial Intertech's board of directors to thwart United Dominion's offer
by repurchasing up to 2.5 million common shares and spinning off 100
percent of the company's Cuno Division.
William R. Holland, United Dominion's chairman and chief executive
officer, described the share buy-back effort as "egregious and clearly
unfair to TEC shareholders because it discriminates against certain
shareholders without providing full and adequate disclosure."
"In our judgment, buying back its shares in the open market Friday
from primarily large institutional investors and arbitrageurs is strong
evidence of TEC management's and board of directors' clear intentions to
entrench themselves further rather than to afford all shareholders an
opportunity to decide the future direction of the company," he said.
Mr. Holland also cited the proposed 100 percent spin-off of Cuno as
additional evidence of the extreme and reactive nature of TEC's unilateral
response, taken without first giving its shareholders an opportunity to
consider United Dominion's offer. In a filing with the Securities and
Exchange
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<PAGE> 21
Commission on Friday, Commercial Intertech indicated that its board had
previously considered and rejected the 100 percent spin-off of Cuno. Now,
in the face of United Dominion's offer, the board has proposed the spin-off
despite the admitted tax risk to shareholders and without even obtaining an
Internal Revenue Service ruling or approval by the Company's owners.
Mr. Holland indicated that United Dominion will continue to seek a
special meeting of TEC shareholders to enable them to make an informed
decision regarding United Dominion's offer after carefully comparing its
value against TEC's reactive alternative plan.
"United Dominion's revised offer of $30 per share incorporates the
synergistic opportunities possible only through the combination of United
Dominion and Commercial Intertech and are not available to TEC, or its Cuno
Division, on a stand-alone basis," Mr. Holland said.
"We are confident that Commercial Intertech shareholders will conclude
that United Dominion's cash proposal offers significantly more value and
considerably less risk than the leveraged alternative proposed by
Commercial Intertech's management and board of directors," he said.
Later on July 15, 1996, the Company issued a press release in which it
stated that the Company's Board would promptly review the revised Offer and in
which it "urged shareholders not to make any determination whether to accept or
reject" the Offer until the Company's Board published a recommendation with
respect to the Offer.
On July 15, 1996, Parent and the Purchaser filed their First Amended
Complaint (the "First Amended Complaint") in connection with the Ohio Action.
Also on July 15, the Ohio Federal District Court scheduled a hearing for July
29, 1996 with respect to claims made by Parent and Purchaser in the Original
Action with respect to the Ohio Control Share Acquisition Law. See "CERTAIN
LEGAL MATTERS" below.
On July 18, 1996, the Company issued a press release in which it stated,
among other things, that the Company's Board had (1) determined to recommend
that shareholders reject as inadequate the Offer; (2) fixed August 30, 1996, in
Youngstown, Ohio, as the date and location of the Ohio Control Share Acquisition
Meeting and the close of business on August 7, 1996, as the record date for the
Ohio Control Share Acquisition Meeting; (3) purported to fix the close of
business on September 3, 1996 as a record date for the solicitation of Agent
Designations; and (4) acted to delay the Distribution Date under the Rights
Agreement until either (a) the close of business on August 7, 1996, or (b) such
earlier date prior to the expiration date of the Offer as the Company's Board
shall designate. Also on July 18, 1996, the Company filed its Answer and
Counterclaims to the First Amended Complaint (the "Company Answer") in
connection with the Ohio Action in which it admitted that the Preferred Shares
are entitled to only one vote per share (notwithstanding that the Company's
public filings under the Exchange Act prior to such time have expressly stated
that the Preferred Shares are entitled to one and one-half votes per share). In
the Company Answer, the Company also asserted counterclaims against Parent and
the Purchaser including alleged disclosure violations under state and federal
law. The Company Answer also asserts that if Parent and the Purchaser obtain
proxies representing more than 10% of the voting power of the Common Shares to
remove the Company's Board, Parent and the Purchaser would be "interested
shareholders" under the Ohio Business Combination Law (as defined below). See
"CERTAIN LEGAL MATTERS" below.
On July 19, 1996, Parent and the Purchaser moved to file in the Ohio Action
their Second Amended Complaint seeking to enjoin the Company and the Company's
Board from taking any steps to effectuate the proposed Spin-Off until the
Company's shareholders have the opportunity to vote at the Ohio Control Share
Acquisition Meeting and the Special Meeting. See "CERTAIN LEGAL MATTERS" below.
On July 25, 1996, following the filing by Parent and the Purchaser of their
definitive proxy materials for, and their commencement of, the solicitation of
Agent Designations to call the Special Meeting and proxies for the Ohio Control
Share Acquisition meeting, the Company sought a temporary restraining order to
enjoin Parent and the Purchaser from soliciting such Agent Designations and
proxies. The Ohio Federal District Court denied the Company's motion.
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<PAGE> 22
TERMS AND CONDITIONS OF THE OFFER
As described above, on July 12, 1996, the Purchaser commenced the Original
Offer and, on July 15, 1996, the Purchaser announced it was increasing the price
to be paid pursuant to the Offer from $27 to $30 per Common Share net to the
seller in cash. As stated in the Offer to Purchase, the purpose of the Offer and
the Proposed Merger is to enable the Purchaser to acquire control of, and the
entire equity interest in, the Company. The Offer, as the first step in the
acquisition of the Company, is intended to facilitate the acquisition of all
outstanding Shares. Parent intends to continue to seek to negotiate with the
Company with respect to the acquisition of the Company by Parent. Parent
currently intends, as soon as practicable following consummation of the Offer,
to seek to have the Company consummate the Proposed Merger.
The Offer is conditioned, among other things, upon the following:
(1) The Minimum Condition. There must be validly tendered a number of
Common Shares which, when added to the Common Shares beneficially owned by the
Parent and its affiliates, constitutes at least two-thirds of the total voting
power of all Shares outstanding on a fully diluted basis on the date of
purchase. As of the date hereof, Parent and the Purchaser each own 500 Common
Shares and no Preferred Shares.
According to the Company 1995 10-K/A, as of July 15, 1996, there were
14,665,404 Common Shares outstanding and, according to the Company Form 10-Q, as
of April 30, 1996 there were 1,039,657 Preferred Shares outstanding. According
to the Company 1995 10-K/A, there were 1,818,600 Common Shares reserved for
issuance under the Company stock plans (with options to purchase 617,051 Common
Shares outstanding as of October 31, 1995) and 1,301,082 Common Shares reserved
for issuance upon conversion of Preferred Shares. According to amendments filed
by the Company through July 25, 1996 to the Schedule 14D-9, the Company
repurchased 951,000 Common Shares after July 15, 1996 pursuant to the Repurchase
Program. The Company 1995 10-K/A states that each Preferred Share is convertible
into 1.235 Common Shares (for a total of 1,283,976 Common Shares issuable upon
conversion of all Preferred Shares).
Based on the foregoing, assuming the exercise of all options and the
conversion of all Preferred Shares, and assuming that no additional Shares or
options were issued, granted or repurchased since the respective dates for which
information has been provided, there would be 15,615,431 Common Shares
outstanding on a fully diluted basis. Parent owns 1,000 Common Shares
beneficially, 500 of which are held of record by Parent and 500 of which are
held of record by the Purchaser. Thus, based on the foregoing assumptions, the
valid tender of 10,409,293 Common Shares would satisfy the Minimum Condition.
However, the actual number of Common Shares required will depend upon the facts
as they exist on the date of purchase.
(2) The Control Share Condition. The Ohio Control Share Acquisition
Approval shall have been obtained from the Company shareholders, or the
Purchaser shall be satisfied, in its sole discretion, that the Ohio Control
Share Acquisition Law is invalid or inapplicable to the Proposed Control Share
Acquisition.
(3) The Business Combination Condition. The Purchaser must be satisfied,
in its sole discretion, that the restrictions contained in Chapter 1704 of the
ORC (the "Ohio Business Combination Law") will not apply to the acquisition of
Common Shares pursuant to the Offer or to the Proposed Merger.
The Ohio Business Combination Law provides that if a purchaser becomes
entitled to exercise or direct the exercise of 10% or more of the total voting
power of the Company in the election of directors (thereby becoming an
"interested shareholder"), the Company may not engage in a "business
combination" (defined to include a variety of transactions, including mergers
such as the Proposed Merger) with the purchaser or any affiliate of the
purchaser for three years after the purchaser becomes an interested shareholder,
and the Ohio Business Combination Law imposes significant restrictions on such
transactions thereafter. The three-year prohibition would not apply to the
Proposed Merger if, among other things, the Company's Board adopts a resolution
approving the Proposed Merger, provided that such resolution is adopted prior to
the date that the Purchaser becomes an interested shareholder (as defined in the
Ohio Business Combination Law).
Parent and the Purchaser have requested that the Company's Board take
appropriate action so that the Ohio Business Combination Law is not applicable
to the acquisition of Common Shares pursuant to the Offer or the Proposed
Merger. In the event that the Company's Board fails to do so prior to the
intended date of the
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<PAGE> 23
consummation of the Offer, the Purchaser expects that the Parent Nominees, if
elected at the Special Meeting, and subject to their fiduciary duties, shall
have the power to, and shall take such appropriate action as shall result in the
satisfaction of the Business Combination Condition. However, in the Company
Answer filed July 18, 1996, the Company requests, among other things, that, if
Parent and the Purchaser obtain proxies representing more than 10% of the voting
power of the Common Shares, seeking, among other things, to remove the current
board of directors, Parent and the Purchaser be declared "interested
shareholders" under the Ohio Business Combination Law. Parent believes the
Company's position is without merit.
(4) The Rights Condition. The Rights shall have been redeemed by the
Company or the Purchaser shall be satisfied, in its sole discretion, that the
Rights have been invalidated or are otherwise inapplicable to the Offer and the
Proposed Merger.
(5) The Articles Amendment Condition. Article SIXTH shall have been
repealed or otherwise amended with the effect that, or the Purchaser shall be
otherwise satisfied, in its sole discretion, that, the provisions of such
Article SIXTH are inapplicable to the Proposed Merger.
The Offer is also subject to other terms and conditions which are described
in the Offer to Purchase and the Letter of Transmittal, copies of which are
available from the Information Agent for the Offer, MacKenzie Partners, 156
Fifth Avenue, New York, New York 10010. If you have not already received a copy
of the Offer to Purchase, the Letter of Transmittal and other Offer documents,
Parent and the Purchaser urge you to obtain such documents by contacting
MacKenzie Partners.
With respect to the Control Share Condition, Parent and the Purchaser have
delivered to the Company (without prejudice to their right to challenge the
validity of the Control Share Acquisition Law) an acquiring person statement
pursuant to the Ohio Control Share Acquisition Law and have commenced the
solicitation of proxies under a separate proxy statement to obtain the Ohio
Control Share Acquisition Approval. In addition, on July 11, 1996, Parent and
the Purchaser commenced the Ohio Action relating, in part, to the Ohio Control
Share Acquisition Law. On July 15, 1996, the Ohio Federal District Court
scheduled a hearing for July 29, 1996 with respect to claims made by Parent and
the Purchaser in the Ohio Action with respect to the Ohio Control Share
Acquisition Law. See "CERTAIN LEGAL MATTERS" below.
With respect to the Business Combination Condition, Parent and the
Purchaser requested in the Offer to Purchase that the Company's Board satisfy
the Business Combination Condition by taking appropriate action so that the Ohio
Business Combination Law is inapplicable to the acquisition of Common Shares
pursuant to the Offer and the Proposed Merger. To the knowledge of Parent and
the Purchaser, the Company's Board of Directors has to date refused to take such
action. Parent and the Purchaser expect that the Parent Nominees will, if
elected at the Special Meeting, and subject to their fiduciary duties, take such
appropriate action as shall result in the satisfaction of the Business
Combination Condition.
With respect to the Rights Condition, Parent and the Purchaser requested in
the Offer to Purchase that the Company's Board of Directors satisfy the Rights
Condition by taking appropriate action to redeem the Rights pursuant to the
terms of the Rights Agreement or to amend the Rights Agreement or take other
action under the Rights Agreement to make the Rights inapplicable to the Offer
and the Proposed Merger. To the knowledge of Parent and the Purchaser, the
Company's Board has to date refused to take such action. Parent and the
Purchaser believe that the Company's Board has a fiduciary obligation to redeem
the Rights or to take other action under the Rights Agreement so as to enable
the Company shareholders to accept the Offer and receive $30 per Common Share
therein or in the Proposed Merger. As described above, if the incumbent
directors are removed at the Special Meeting and prior to such time the
Company's Board shall have failed to redeem the Rights, the newly elected
directors may be unable to redeem the Rights, and the Purchaser may be unable or
unwilling to purchase Common Shares in the Offer, for a period of 180 days after
the date on which the Parent Nominees are elected and constitute a majority of
the directors.
Parent and the Purchaser have commenced the Ohio Action relating, in part,
to the Rights. See "CERTAIN LEGAL MATTERS" below.
Parent and the Purchaser have requested that the Company's Board take
appropriate action to unanimously recommend to the Company's shareholders the
repeal of Article SIXTH. There can be no
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<PAGE> 24
assurance that the Company's Board will do so. In the event that the Company's
Board fails to do so prior to the intended date of the consummation of the
Offer, the Purchaser expects the Parent Nominees, if all such nominees are
elected at the Special Meeting, and subject to their fiduciary duties, to take
such appropriate action as shall result in the satisfaction of the Articles
Amendment Condition.
CERTAIN LEGAL MATTERS
On July 11, 1996, Parent and the Purchaser commenced the Ohio Action in the
Ohio Federal District Court against the Company, the directors of the Company,
the Acting Commissioner of Securities of the Ohio Division of Securities, the
Director of Commerce of the Ohio Department of Commerce and the State of Ohio
seeking, among other things, that the Ohio Federal District Court declare
unconstitutional and enjoin application of Sections 1707.041, 1707.042, 1707.23
and 1707.26 of the ORC (collectively, the "Ohio Take-Over Act") and certain
provisions of the Ohio Control Share Acquisition Law that impair the voting
rights of certain "interested shares" (sometimes referred to herein as the
"Disqualified Shares"). In March, 1995, in Luxottica Group S.p.A. v. The United
States Shoe Corporation, the Ohio Federal District Court issued an order
declaring invalid such provisions of the Ohio Control Share Acquisition Law that
impair the voting rights of the Disqualified Shares. Without prejudice to its
position that the Ohio Take-Over Act is unconstitutional, on July 12, 1996,
Parent and the Purchaser submitted Form 041 under the Ohio Take-Over Act,
including a copy of the Schedule 14D-1 relating to the Offer, to the Ohio
Division of Securities. If injunctive relief is not obtained against the
enforcement of the Ohio Take-Over Act, then the Purchaser may not be obligated
to purchase Common Shares tendered pursuant to the Offer or may, among other
things, terminate the Offer or amend the terms and conditions of the Offer.
The complaint also alleges that the 180-Day Restrictions are in violation
of the ORC and invalid, and further that refusal by the directors of the Company
to redeem the Rights constitutes a breach of the directors' fiduciary duties.
The complaint seeks, among other things, that the Court enjoin the Company and
its directors from taking any steps to enforce or amend the Rights, and require
that the Rights be redeemed and that the 180-Day Restrictions be deleted.
The complaint further alleged that the Preferred Shares held of record by
the ESOP Trustee for the Company's ESOPs are not entitled to one and one-half
votes per share under Ohio law and the Company Articles and the Company
Regulations, but rather that each Preferred Share is entitled to one vote. The
complaint sought, among other things, a declaratory judgment that the Preferred
Shares are entitled to only one vote per share and an injunction against the
recognition of any altered or increased voting rights for the Preferred Shares.
In the Company Answer, and subsequently in the Company 1995 10-K/A, the Company
admitted that the Preferred Shares are entitled to only one vote per share
notwithstanding that since September 1994 the Company's Board has recognized one
and one-half votes per Preferred Share.
On July 15, 1995, the Ohio Federal District Court scheduled a hearing for
July 29, 1996 with respect to claims made by Parent and the Purchaser in the
Ohio Action seeking that such court declare unconstitutional and enjoin certain
provisions of the Ohio Control Share Acquisition Law that impair the voting
rights of Disqualified Shares.
Also on July 15, 1996, Parent and the Purchaser filed the First Amended
Complaint alleging that the proposed Spin-Off and the Repurchase Program
constitute violations of the directors' fiduciary duties under Ohio law, that
the Schedule 14D-9 is false and misleading and that the Repurchase Program
violates federal securities laws.
On July 18, 1996, the Company filed the Company Answer to the First Amended
Complaint. Among other things, the Company's counterclaims set forth in the
Company Answer request that if Parent and the Purchaser obtain proxies
representing more than 10% of the voting power of the Common Shares to remove
the Company's Board and elect the Parent Nominees at the Special Meeting, Parent
and Purchaser be declared "interested shareholders" under the Ohio Business
Combination Law with the effect that Parent and the Purchaser would be
prohibited from consummating the Proposed Merger for a period of three years.
23
<PAGE> 25
Parent and the Purchaser believe that the Company's position is an incorrect
reading of the law and is without merit. The Company Answer admitted that each
Preferred Share is entitled to one vote only.
On July 19, 1996, Parent and the Purchaser moved to file their Second
Amended Complaint seeking to enjoin the Company and the Company's Board from
taking any steps to effectuate the Spin-Off until the Company's shareholders
have the opportunity to vote at the Ohio Control Share Acquisition Meeting and
the Special Meeting.
In addition, the ESOP Trusts contain certain pass-through voting
restrictions described under "VOTING AT THE SPECIAL MEETING" above. Parent and
the Purchaser believe that, notwithstanding the express terms of the trust
document, the ESOP Trustee has a fiduciary duty under ERISA to exercise its
discretion with respect to voting Shares held in the ESOP which are allocated to
a participant's account but for which no instructions are received by it and for
all Shares held in the ESOP which are not allocated to a participant's account.
See "VOTING AT THE SPECIAL MEETING" above.
24
<PAGE> 26
SOLICITATION OF PROXIES
Proxies for the Special Meeting may be solicited by mail, telephone,
telecopier or the Internet and in person. Solicitations may be made by
directors, officers, investor relations personnel and other employees of Parent
or the Purchaser, none of whom will receive additional compensation for such
solicitations. Parent has requested banks, brokerage houses and other
custodians, nominees and fiduciaries to forward all of its solicitation
materials to the beneficial owners of the Shares they hold of record. Parent
will reimburse these record holders for customary clerical and mailing expenses
incurred by them in forwarding these materials to their customers.
Parent has retained MacKenzie Partners for solicitation and advisory
services in connection with (i) this solicitation, (ii) the solicitation of
Agent Designations to call the Special Meeting and (iii) the solicitation of
proxies for the Ohio Control Share Acquisition Meeting. Parent has also retained
MacKenzie Partners to act as Information Agent in connection with the Offer.
Parent will pay MacKenzie Partners usual and customary compensation for all such
services, including up to $100,000 as compensation for this solicitation and
will reimburse MacKenzie Partners for reasonable out-of-pocket expenses in
connection therewith. Parent has agreed to indemnify MacKenzie Partners against
certain liabilities and expenses in connection with the Offer, including,
without limitation, certain liabilities under the federal securities laws.
MacKenzie Partners will solicit proxies from individuals, brokers, bank nominees
and other institutional holders.
Schroder Wertheim is acting as Dealer Manager in connection with the Offer
and as Parent's financial advisor with respect to the Offer and the Proposed
Merger. As compensation for such services, Parent has agreed to pay or cause to
be paid to Schroder Wertheim a fee of $500,000 upon commencement of the Offer.
Parent has agreed to pay or cause to be paid to Schroder Wertheim an additional
fee of $3,500,000 contingent upon consummation of a Transaction. "Transaction"
has been defined as an acquisition by Parent of the Company by way of (i)
merger, (ii) purchase of all or a portion of the assets or stock of the Company,
(iii) obtaining 50% or more voting control of the common stock of the Company or
effective control of the Company's Board through a proxy or similar
solicitation, or (iv) otherwise. Parent has also agreed that, in the event a
Transaction is not consummated, Parent will pay to Schroder Wertheim 10% of any
profits Parent receives upon its disposition of, or otherwise received in
respect of, securities of the Company acquired by it, or 10% of any break-up fee
Parent receives from the Company (in each case, less any fees paid to Schroder
Wertheim at the commencement of the Offer). In addition, Parent has agreed to
reimburse Schroder Wertheim for certain reasonable out-of-pocket expenses
incurred in connection with the Offer and the Proposed Merger or otherwise
arising out of Schroder Wertheim's engagement, and has also agreed to indemnify
Schroder Wertheim (and certain affiliated persons) against certain liabilities
and expenses, including, without limitation, certain liabilities under the
federal securities laws.
Schroder Wertheim may from time to time in the future render various
investment banking services to Parent and its affiliates, for which it is
expected it would be paid customary fees. In the ordinary course of business,
Schroder Wertheim and its affiliates may actively trade the securities of Parent
and the Company for their own account and for the account of customers and
accordingly may, at any time, hold long or short positions in such securities.
In connection with Schroder Wertheim's engagement as financial advisor,
Parent anticipates that certain employees of Schroder Wertheim may communicate
in person, by telephone or otherwise with a limited number of institutions,
brokers or other persons who are Company shareholders for the purpose of
assisting in the solicitation of Agent Designations to call the Special Meeting
and of proxies for the Special Meeting, as well as for the solicitation of
proxies for the Ohio Control Share Acquisition Meeting. Schroder Wertheim will
not receive any fee for or in connection with such solicitation activities apart
from the fees which it is otherwise entitled to receive as described above.
The entire expense of soliciting Agent Designations and proxies for the
Special Meeting is being borne by Parent or a subsidiary of Parent. Neither
Parent nor any such subsidiary will seek reimbursement for such expenses from
the Company. Costs incidental to such Agent Designations and proxies include
expenditures for printing, postage, legal and related expenses and are expected
to be approximately $350,000. Total costs incurred to date in furtherance of or
in connection with such Agent Designations and proxies are approximately
$50,000.
25
<PAGE> 27
If the Purchaser should terminate, or materially amend the terms of, the
Offer prior to the Special Meeting, Parent or the Purchaser will disseminate
such information regarding such changes to the Company's shareholders and, in
appropriate circumstances, will provide the Company shareholders with a
reasonable opportunity to revoke their proxies prior to the Special Meeting.
SHAREHOLDER PROPOSALS
According to the Annual Meeting Proxy Statement, the deadline for receipt
of shareholders' proposals for inclusion in the Company's 1997 proxy material is
October 1, 1996.
26
<PAGE> 28
OTHER INFORMATION
Parent is a corporation organized under the Canada Business Corporation Act
and is headquartered in Charlotte, North Carolina. Parent's businesses
manufacture proprietary engineered products for industrial and building
customers worldwide. Parent's Industrial Products Segment serves selected
markets with engineered equipment for heating, air drying and purification,
fluid handling, heat exchange, compaction, food processing and aerospace
applications. Parent's Building Products Segment manufactures a variety of
complementary products, ranging from steel doors to loading dock equipment to
complete pre-engineered metal buildings systems, primarily for the
non-residential construction market.
The Purchaser is a newly incorporated Delaware corporation and an indirect
wholly owned subsidiary of Parent which to date has not conducted any business
other than in connection with the Offer and the Proposed Merger. The principal
executive offices of Parent and the Purchaser are located at 2300 One First
Union Center, 301 South College Street, Charlotte, North Carolina 28202. United
Dominion Industries, Inc., a Delaware corporation and a direct wholly owned
subsidiary of Parent, owns all the outstanding shares of the Purchaser. William
R. Holland, Chairman and Chief Executive Officer of Parent, owns 1,000 Common
Shares that he acquired in 1994.
Certain information about the directors and executive officers of Parent
and the Purchaser and certain employees and other representatives of Parent who
may also assist MacKenzie Partners in soliciting proxies is set forth in the
attached Schedule I. Schedule II sets forth certain information relating to
Common Shares owned by Parent, the Purchaser, and other representatives.
Schedule III sets forth certain information, as made available in public
documents, regarding Shares held by the Company's principal shareholders and its
management.
THIS PROXY STATEMENT IS NEITHER A REQUEST FOR THE TENDER OF COMMON SHARES
NOR AN OFFER WITH RESPECT THERETO. THE PURCHASER'S OFFER IS BEING MADE ONLY BY
MEANS OF THE OFFER TO PURCHASE AND THE LETTER OF TRANSMITTAL. FOR ADDITIONAL
COPIES OF THE OFFER TO PURCHASE AND THE LETTER OF TRANSMITTAL, CALL THE
INFORMATION AGENT FOR THE OFFER, MACKENZIE PARTNERS, AT 212-929-5500 (CALL
COLLECT) OR 800-322-2885 (TOLL FREE).
PLEASE INDICATE YOUR SUPPORT OF THE PURCHASER'S OFFER BY COMPLETING,
SIGNING AND DATING THE ENCLOSED GOLD-STRIPED SPECIAL MEETING PROXY AND RETURNING
IT PROMPTLY TO MACKENZIE PARTNERS AT 156 FIFTH AVENUE, NEW YORK, NEW YORK 10010,
IN THE ENCLOSED ENVELOPE. NO POSTAGE IS NECESSARY IF THE ENVELOPE IS MAILED IN
THE UNITED STATES.
YOUR SUPPORT IS IMPORTANT! PLEASE SIGN, DATE AND MAIL THE ACCOMPANYING
GOLD-STRIPED SPECIAL MEETING PROXY PROMPTLY.
UNITED DOMINION INDUSTRIES LIMITED
OPUS ACQUISITION CORPORATION
August , 1996
27
<PAGE> 29
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS
OF PARENT AND THE PURCHASER
PARENT
The following table sets forth the name, business or residence address,
principal occupation or employment at the present time and during the last five
years, and the name, principal business and address of any corporation or other
organization in which such employment is conducted or was conducted of each
director and executive officer of Parent. Except for Messrs. Crossgrove, Grant,
MacKay, McDonald, Scott, Stinson, Allan Taylor and George Taylor, who are
citizens of Canada, each of the Parent's directors and executive officers is a
citizen of the United States. The business address of each executive officer of
Parent is 2300 One First Union Center, Charlotte, North Carolina 28202. Each
occupation set forth opposite a person's name, unless otherwise indicated,
refers to employment with Parent. Directors are indicated by an asterisk.
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR
EMPLOYMENT AND
MATERIAL OCCUPATIONS FOR PAST
FIVE YEARS,
NAME, PRINCIPAL BUSINESS AND
BUSINESS (b) OR RESIDENCE (r) ADDRESS OF
NAME ADDRESS PRINCIPAL OFFICE OF EMPLOYER
- ------------------------------ ------------------------------ ------------------------------
<S> <C> <C>
James E. Courtney*............ (r)1779 Venus Dr. Chairman of the Board, First
Sanibel, Florida Independence Bank of Fort
33957-3427 Myers, Jan. 1, 1996.
President, The Mariner Group,
Inc., a real estate management
and development company, 12800
University Drive, Suite 350,
Fort Myers, Florida 33907,
from 1992 to 1995.
Peter A. Crossgrove*.......... (b)141 Adelaide Street West President and CEO, Southern
Suite 1703 Africa Minerals Corporation, a
Toronto, Ontario M5H 3L5 diamond exploration company,
Canada 141 Adelaide Street West,
Suite 1703, Toronto, Ontario
M5H 3L5, Canada, from 1994 to
present. Chairman and Chief
Executive Officer of Brush
Creek Corporation, an
investment holding company,
250 Yonge Street, Toronto,
Ontario M5B 1C8, Canada, from
1993 to present. Acting CEO,
Placer Dome Inc., an
international mining company,
Suite 3500, IBM Tower,
Toronto-Dominion Ctr.,
Toronto, Ontario M5K 1N3,
Canada, from 1992 to 1993.
President and Chief Executive
Officer of Itco Properties
Ltd., a wholly owned
subsidiary of Starlaw Holdings
Limited, a company that
develops, purchases and holds
real estate in Canada and the
U.S., from 1982 to 1992.
</TABLE>
S-1
<PAGE> 30
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR
EMPLOYMENT AND
MATERIAL OCCUPATIONS FOR PAST
FIVE YEARS,
NAME, PRINCIPAL BUSINESS AND
BUSINESS (b) OR RESIDENCE (r) ADDRESS OF
NAME ADDRESS PRINCIPAL OFFICE OF EMPLOYER
- ------------------------------ ------------------------------ ------------------------------
<S> <C> <C>
R. Stuart Dickson*............ (b)2000 Two First Union Center Chairman of the Executive
Charlotte, NC 28282 Committee, Ruddick Corporation,
an industrial thread, regional
supermarket and venture capital
company, 2000 Two First Union
Center, Charlotte, NC 28282,
from 1994 to present. Chairman,
Ruddick Corporation, from 1968
to 1994.
1994.James A. Grant*.......... (b)Suite 3900 Partner of Stikeman, Elliott,
1155 Rene Levesque Blvd. W. a law firm, Commerce Court
Montreal, Quebec H3B 3V2 West, Suite 5300, Toronto,
Canada Ontario M5L IB9, Canada, from
1970 to present. Chairman of
Executive Committee of
Stikeman, Elliott since 1988.
William R. Holland*........... Chairman since 1987 and Chief
Executive Officer since 1986.
Russell C. King, Jr.*......... (r)2376E Dunwoody Crossing Retired since May 30, 1994.
Atlanta, GA 30338 President and Chief Operating
Officer, Sonoco Products
Company, an international
manufacturer of packaging
products, 1 North Second
Street, P.O. Box 160,
Hartsville, SC 29551, from
1990 to 1994.
H. John McDonald*............. (b)Suite 2800, 2 Bloor St. Chairman, Black & McDonald
East Toronto, Ontario Limited, an international
M4W 1A8 Canada mechanical and electrical
contracting company, Suite
2800, 2 Bloor St. East,
Toronto, Ontario M4W 1A8,
Canada, since 1984.
Dalton D. Ruffin*............. (r)2841 Galsworthy Dr. Retired since January 1, 1989.
Winston-Salem, NC 27106
I. Barry Scott*............... (r)96 Churchill Road Baie Retired since February 28,
d'Urfe, Quebec H9X 2Y3 1995. Chairman and Chief
Canada Executive Officer of CP Rail
System, a transportation
division of Canadian Pacific
Limited, 910 Peel Street, Room
215, P.O. Box 6042, Station
Centre-ville, Montreal, Quebec
H3C 3E4, Canada, from 1985 to
1995.
William W. Stinson*........... (b)Suite 800, Place du Canada Retired since May 1, 1996.
P.O. Box 6042, Chairman of Canadian Pacific
Station Centre-ville Limited, a transportation,
Montreal, Quebec H3C 3E4 energy, real estate and hotel
Canada company, Suite 800, Place du
Canada, P.O. Box 6042, Station
Centre-ville, Montreal, Quebec
H3C 3E4, Canada from 1989 to
1996. Chief Executive Officer
of Canadian Pacific Limited
from 1985 to 1996.
</TABLE>
S-2
<PAGE> 31
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR
EMPLOYMENT AND
MATERIAL OCCUPATIONS FOR PAST
FIVE YEARS,
NAME, PRINCIPAL BUSINESS AND
BUSINESS (b) OR RESIDENCE (r) ADDRESS OF
NAME ADDRESS PRINCIPAL OFFICE OF EMPLOYER
- ------------------------------ ------------------------------ ------------------------------
<S> <C> <C>
Allan R. Taylor, O.C.*........ (r)The Chedington Manor Retired since January 31,
1 Chedington Place, Suite 2A 1995. Chairman, Royal Bank of
North York, Ontario M4N 3R4 Canada, a financial
Canada institution, Royal Bank Plaza,
Toronto, Ontario M5J 2J5,
Canada, from 1986 to 1995.
George S. Taylor*............. (b)120 Adelaide St. W Retired since December 31,
Suite 1850 1995. President and Chief
Toronto, Ontario M5J 2T3 Executive Officer, John Labatt
Canada Limited, a brewing company,
Labatt House BCE Place, P.O.
Box 811, Suite 200-181 Bay
St., Toronto, Ontario M5J 2T3,
Canada, from 1992 to 1995.
Executive Vice President, John
Labatt Limited, from 1985 to
1992.
Jan K. Ver Hagen*............. President and Chief Operating
Officer since 1994. Vice
Chairman, Emerson Electric
Co., a manufacturer of a broad
range of electrical and
electronic products, 8000 W.
Florissant Ave., St. Louis,
Missouri 63136, from 1988 to
1994.
Robert E. Drury............... Executive Vice President and
Chief Administrative Officer
since 1995. Chief Financial
Officer from 1992 to 1995, and
Senior Vice President from
1993 to 1995. Vice President
from 1987 to 1993.
Richard A. Bearse............. Senior Vice President since
1996. President and Chief
Executive Officer, Flair
Corporation, a manufacturer of
air filtration and dehydration
equipment, 4647 S.W. 40th
Avenue, Ocala, Florida 34474,
from 1992 to 1995. President
and Chief Executive Officer,
Pneumatic Products
Corporation, a subsidiary of
Flair, from 1991 to 1992.
B. Bernard Burns, Jr.......... General Counsel and Secretary
since 1992, and Senior Vice
President since 1993. Vice
President from 1989 to 1993.
Glenn A. Eisenberg............ Senior Vice President and
Chief Financial Officer since
1995. Vice President of
Planning and Development from
1992 to 1995. Director of
Corporate Finance and Investor
Relations since 1991. Manager
of Treasury Analysis and
Services from 1990 to 1991.
John G. MacKay................ Senior Vice President since
1995. Various positions with
Parent since 1990, including
President-- Industrial
Products segment.
</TABLE>
S-3
<PAGE> 32
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR
EMPLOYMENT AND
MATERIAL OCCUPATIONS FOR PAST
FIVE YEARS,
NAME, PRINCIPAL BUSINESS AND
BUSINESS (B) OR RESIDENCE (R) ADDRESS OF
NAME ADDRESS PRINCIPAL OFFICE OF EMPLOYER
- ------------------------------ ------------------------------ ------------------------------
<S> <C> <C>
segment.J. Milton Childress Vice President since 1996.
II.......................... Assistant Vice President from
1995 to 1996. Director of
corporate development from
1992 to 1995. Ernst & Young
prior to 1992.
William Dries................. Vice President and Controller
since 1990.
June P. Hassett............... Vice President since 1996.
Assistant Vice President from
1995 to 1996. Director of
taxes from 1991 to 1995.
Richard L. Magee.............. Vice President since 1996.
Assistant Vice President from
1995 to 1996. Associate
General Counsel since 1993,
and Assistant General Counsel
from 1989 to 1993.
Robert L. Shaffer............. Vice President of Corporate
Communications since 1990.
Thomas J. Snyder.............. Vice President and Treasurer
since 1993, and Treasurer
since 1991. Various positions
with Parent since 1977.
Timothy J. Verhagen........... Vice President since 1993.
Vice President and Associate
General Counsel, The Marley
Company, a manufacturer of
engineered equipment for
heating, fluid handling and
heat exchange applications,
1900 Shawnee Mission Parkway,
Mission, Kansas 66205, from
1985 to 1993.
</TABLE>
THE PURCHASER
The name and position with the Purchaser of each director and executive
officer of the Purchaser are set forth below. The business address, present
principal occupation or employment, five-year employment history and citizenship
of each person is set forth below. Directors are indicated by an asterisk.
<TABLE>
<CAPTION>
NAME POSITION WITH THE PURCHASER
- ---------------------------------------- ---------------------------
<S> <C>
Vice President and
B. Bernard Burns, Jr.*.................. Secretary
Robert E. Drury*........................ President
Vice President and
Glenn A. Eisenberg*..................... Treasurer
Richard L. Magee........................ Assistant Secretary
</TABLE>
S-4
<PAGE> 33
SOLICITATION OF PROXIES
The following individuals constitute representatives of the Dealer Manager
who may solicit proxies:
<TABLE>
<S> <C>
Michael Grad............................ Managing Director
Schroder Wertheim & Co. Incorporated
Equitable Center
787 Seventh Avenue
New York, New York 10019-6016
Henry Aboodi............................ Vice President
Schroder Wertheim & Co. Incorporated
Equitable Center
787 Seventh Avenue
New York, New York 10019-6016
</TABLE>
S-5
<PAGE> 34
SCHEDULE II
SHARES HELD BY PARENT, THE PURCHASER AND SCHRODER WERTHEIM
As of the date hereof, the Purchaser holds of record 500 Common Shares and
no Preferred Shares and Parent holds of record 500 Common Shares and no
Preferred Shares.
In the ordinary course of its business, Schroder Wertheim may trade the
securities of the Company for its own account and the accounts of its customers
and, accordingly, may at any time hold a long or short position in such
securities. As of the date hereof, Schroder Wertheim held no Shares.
The following table sets forth the dates within the past two years on which
Schroder Wertheim purchased or sold Common Shares for its own account, and the
amount purchased or sold on each such date:
<TABLE>
<CAPTION>
DATE TRANSACTION AMOUNT
-------------------------- ----------- --------------------
<S> <C> <C>
September 18, 1995 purchase 600 Common Shares
September 19, 1995 sale 600 Common Shares
February 4, 1996 purchase 2,000 Common Shares
February 15, 1996 sale 500 Common Shares
February 16, 1996 purchase 500 Common Shares
March 5, 1996 sale 2,000 Common Shares
</TABLE>
S-6
<PAGE> 35
SCHEDULE III
PRINCIPAL SHAREHOLDERS OF THE COMPANY
AND SHAREHOLDINGS OF THE COMPANY'S MANAGEMENT
Set forth below is information regarding Shares owned by (i) those persons
owning more than 5% of the outstanding Shares and (ii) directors and executive
officers of the Company as a group. Such information is obtained from the
Company's preliminary proxy statement on Schedule 14A for the Ohio Control Share
Acquisition Meeting, filed with the Commission on July 25, 1996 (the "Company
Preliminary Proxy Statement").
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS
The name of any person or "group" (as that term is used in the Exchange
Act) disclosed by the Company in its proxy statement for its 1996 Annual Meeting
of Shareholders to be the beneficial owner of more than five percent (5%) of any
class of the Company's voting securities as of June 30, 1996 is set forth below:
<TABLE>
<CAPTION>
AMOUNT AND
NATURE OF PERCENT PERCENT OF
NAME AND ADDRESS OF BENEFICIAL OF ALL VOTING
TITLE OF CLASS BENEFICIAL OWNER OWNERSHIP CLASS** SHARES**
- ------------------- ------------------------- ------------- -------- ----------
<S> <C> <C> <C> <C> <C>
Common National City Bank, N.E. 989,707(1) 7.17% 6.67%
P.O. Box 450
Youngstown, OH 44501
Series B Preferred Mellon Bank N.A. 1,039,657(2) 100.00% 7.00%
P.O. Box 444
Pittsburgh, PA 15230
</TABLE>
- ---------------
** Percent of All Voting Shares and Percent of Class based on total
outstanding Common Shares and Preferred Shares as of July 19, 1996.
(1) This figure includes 175,250 Common Shares held in trust by National
City Bank, N.E. (trustee) for the benefit of participants in the Commercial
Intertech Corp. Employee Savings and Stock Purchase Plan. This figure includes
1,597 Common Shares held in trust by National City Bank (trustee) for the
benefit of participants in the Non-Qualified Stock Purchase Plan of Commercial
Intertech Corp.
National City Bank has sole voting power over 644,032 Shares and shared
voting power over 170,806 Shares. National City Bank has sole investment power
over 277,613 Shares and shared investment power over 712,094 Shares.
(2) This figure represents all of the outstanding Preferred Shares held of
record by Mellon Bank N.A. (trustee) for the benefit of participants in the
ESOPs. The trust for these plans contains provisions for pass-through voting
rights to the employee participants in the plans.
Mellon Bank has shared voting power and shared investment power over all
Preferred Shares.
SECURITY OWNERSHIP OF MANAGEMENT
The directors, nominees for the office of director, the Chief Executive
Officer, the four other highly compensated executive officers, a former
executive officer and all directors and executive officers as a group
S-7
<PAGE> 36
were the beneficial owners of the Company's voting shares, as of June 30, 1996,
as disclosed in the Company Preliminary Proxy Statement, as set forth below:
<TABLE>
<CAPTION>
AMOUNT AND NATURE PERCENT OF
OF BENEFICIAL ALL VOTING
NAME OF BENEFICIAL OWNER OWNERSHIP SHARES**
- ------------------------------------------------ ----------------- ----------
<S> <C> <C>
William J. Bresnahan............................ 300 *
Charles B. Cushwa III........................... 200,380(1)(4)(5) 1.48%
(8)(12)(16)
William W. Cushwa............................... 238,925(1)(2)(3)(4)(6)(7) 1.61%
(8)(13)(14)(16)(17)
John M. Galvin.................................. 5,750(8) *
John Gilchrist.................................. 32,032(8)(10)(14) *
Richard J. Hill................................. 10,397(8)(9) *
Neil D. Humphrey................................ 6,635(8)(9) *
Hubert Jacobs van Merlen........................ 13,103 *
Mark G. Kachur.................................. 32,086(8) *
William E. Kassling............................. 5,000 *
Gerald C. McDonough............................. 4,500(8) *
C. Edward Midgley............................... 10,000 *
Paul J. Powers.................................. 329,041(2)(8)(10)(14) 2.22%
George M. Smart................................. 2,750(8) *
Don E. Tucker................................... 136,855(1)(2)(8)(11) *
Bruce C. Wheatley............................... 34,714(8)(15) *
All Directors and Executive Officers............ 1,198,805 8.08%
as a Group (19 people)
</TABLE>
- ---------------
* less than 1%.
** Percent of All Voting Shares based on total outstanding Common Shares and
Preferred Shares as of July 19, 1996.
(1) Does not include Common Shares owned by the members of the above-mentioned
directors' families who share their homes, as follows: of Mr. Charles
Cushwa -- 947 shares; of Mr. William Cushwa -- 26,308 shares; and of Mr.
Tucker -- 1,146 shares. Beneficial ownership thereof is disclaimed by the
respective directors.
(2) Includes the beneficial interest in Common Shares (fractional shares not
shown) credited to the accounts of the above-mentioned beneficial owners by
the Trustee acting under the provisions of the Company's Employee Savings
and Stock Purchase Plan, as follows: Mr. William Cushwa -- 4,347 shares;
Mr. Powers -- 1,630 shares; and Mr. Tucker -- 9,446 shares.
(3) Includes Common Shares held by the directors as custodians for their minor
children as follows: minor children of Mr. William Cushwa -- 4,011 shares.
(4) Charles B. Cushwa III and William W. Cushwa are two of three beneficiaries
of a trust, of which they are not trustees, which consists of 294,000
Common Shares, the income from which will be paid to the beneficiaries
equally during their lives. These shares are not included in the amounts
shown in the table.
(5) Includes 44,000 Common Shares held in trust, in which the children of
Charles B. Cushwa III have a remainder interest, and of which National City
Bank, N.E. and Charles B. Cushwa III are co-trustees. Beneficial ownership
thereof is disclaimed by Mr. Charles B. Cushwa III.
(6) Does not include 11,250 Common Shares held in trust, of which William W.
Cushwa is not a trustee, for the benefit of his child and of which
beneficial ownership is disclaimed by Mr. William W. Cushwa.
(7) Includes 44,000 Common Shares held in trust, in which the children of
William W. Cushwa have a remainder interest, and of which National City
Bank, N.E. and William W. Cushwa are co-trustees. Beneficial ownership
thereof is disclaimed by Mr. William W. Cushwa.
S-8
<PAGE> 37
(8) Includes Common Shares acquirable within 60 days of June 30, 1996 upon
exercise of options issued under the Company's Stock Option and Award Plans
as follows: Mr. Charles Cushwa -- 2,250 shares; Mr. William Cushwa -- 1,875
shares; Mr. Galvin -- 2,250 shares; Mr. Gilchrist -- 11,250 shares; Mr.
Hill -- 2,250 shares; Mr. Humphrey -- 1,500 shares; Mr. McDonough -- 2,250
shares; Mr. Powers -- 137,250 shares; Mr. Wheatley -- 11,250 shares; Mr.
Kachur -- 7,500 shares; Mr. Smart -- 750 shares; and Mr. Tucker -- 750
shares.
(9) Includes Common Shares (fractional shares not shown) credited to the
accounts of the above-mentioned beneficial owners by the administrator of
the Company's Automatic Dividend Reinvestment Plan, as follows: Mr.
Hill -- 3,147 shares; and Mr. Humphrey -- 1,485 shares.
(10) Includes in each case 317 Preferred Shares (fractional shares not shown)
and the following number of Common Shares (fractional shares not shown)
credited to the accounts of the above-mentioned beneficial owners by the
Trustee acting under the provisions of the Company's 401(k) plan: Mr.
Gilchrist -- 441 shares; and Mr. Powers -- 5,011 shares.
(11) Includes 206 Preferred Shares (fractional shares not shown) and 5,036
Common Shares (fractional shares not shown) credited by the Trustee acting
under the provisions of the Company's 401(k) plan.
(12) Includes 38,396 Common Shares held in trust, in which the children of
Charles B. Cushwa III have a remainder interest, and of which National City
Bank, N.E. and Charles B. Cushwa III are co-trustees. Beneficial ownership
thereof is disclaimed by Mr. Charles B. Cushwa III.
(13) Includes 61,000 Common Shares held in trust, in which the children of
William W. Cushwa have a remainder interest, and of which National City
Bank, N.E. and William W. Cushwa are co-trustees. Beneficial ownership
thereof is disclaimed by Mr. William W. Cushwa.
(14) Includes in each case two Common Shares (fractional shares not shown) as a
result of participation in the Company's Employee Stock Ownership Plan and
the following number of Preferred Shares (fractional shares not shown) as a
result of participation in the Company's Employee Stock Ownership Plan: Mr.
William Cushwa -- 324 shares; Mr. Gilchrist -- 398 shares; and Mr.
Powers -- 719 shares.
(15) Includes 96 Preferred Shares (fractional shares not shown) and 1,890 Common
Shares (fractional shares not shown) held under the provisions of the
Company's 401(k) plan. Includes 110 Preferred Shares (fractional shares not
shown) as a result of participation in the Company's Employee Stock
Ownership Plan.
(16) Charles B. Cushwa III and William W. Cushwa are two of three beneficiaries
of a trust, of which they are not trustees, containing 75,000 shares
distribution of which is dependent upon the resolution of certain probate
estate matters. The shares are not included in the amounts shown in the
table.
(17) Includes 300 Preferred Shares (fractional shares not shown) and 903 Common
Shares (fractional shares not shown) credited by the trustee acting under
the provisions of the Company's 401(k) plan.
S-9
<PAGE> 38
<TABLE>
<S> <C> <C>
- ------ IMPORTANT
- -------------------
If your shares are registered in your own name, you may mail or fax your
GOLD-STRIPED proxy card (both sides) to MacKenzie Partners, Inc. at the address or
fax number listed below.
If your shares are held in "street name" -- held by your brokerage firm or bank --
immediately instruct your broker or bank representative to sign United Dominion's
GOLD-STRIPED proxy card on your behalf. If you have any questions on voting your
shares, please call.
PARTICIPANTS IN THE COMPANY'S EMPLOYEE STOCK OWNERSHIP PLAN AND RETIREMENT STOCK
OWNERSHIP AND SAVINGS PLAN (THE "ESOPs") AND THE COMPANY'S NON-QUALIFIED STOCK
PURCHASE PLAN AND EMPLOYEE SAVINGS AND STOCK PURCHASE PLAN (THE "PLANS") DESIRING
TO VOTE SHARES HELD ON THEIR BEHALF SHOULD SO INSTRUCT THE ESOP TRUSTEE OR THE
PLAN TRUSTEE, AS APPLICABLE, BY COMPLETING THE FORM WHICH SHOULD BE PROVIDED TO
PARTICIPANTS BY THE ESOP TRUSTEE OR THE PLAN TRUSTEE, AS APPLICABLE, FOR THAT
PURPOSE.
LOGO
156 Fifth Avenue
New York, NY 10010
CALL TOLL-FREE (800) 322-2885
FAX: (212) 929-0308
- ----------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 39
PROXY
COMMERCIAL INTERTECH CORP.
SPECIAL MEETING OF SHAREHOLDERS
TO BE HELD ON , 1996
THIS PROXY IS SOLICITED BY
UNITED DOMINION INDUSTRIES LIMITED
AND
OPUS ACQUISITION CORPORATION.
The undersigned hereby appoints Daniel H. Burch, Stanley J. Kay, Jr., and
Mark H. Harnett, and each of them, with full power of substitution, the proxies
of the undersigned to vote all of the outstanding Common Shares, par value $1.00
per share ("Common Shares"), of Commercial Intertech Corp. (the "Company") that
the undersigned is entitled to vote at the Special Meeting of Shareholders of
the Company to be held on , 1996 (the "Special Meeting"), or at any
adjournment or postponement of the Special Meeting, on the following matters
which are described in the Proxy Statement (the "Proxy Statement"; all
capitalized terms used herein without definition having the meaning set forth
therein) of United Dominion Industries Limited ("United Dominion") and Opus
Acquisition Corporation ("Opus Acquisition"), dated August , 1996, as follows:
UNITED DOMINION AND OPUS ACQUISITION RECOMMEND
THAT YOU VOTE "FOR" ITEMS 1 - 8.
FIRST PROPOSAL: RESOLUTION CALLING FOR TO PRESIDE AT THE SPECIAL
MEETING.
/ / FOR / / AGAINST / / ABSTAIN
SECOND PROPOSAL: RESOLUTION CALLING FOR REDEMPTION OF THE RIGHTS.
/ / FOR / / AGAINST / / ABSTAIN
THIRD PROPOSAL: RESOLUTION CALLING FOR REMOVAL OF ALL CURRENT DIRECTORS AND
REDUCTION OF THE SIZE OF THE COMPANY'S BOARD.
/ / FOR / / AGAINST / / ABSTAIN
FOURTH PROPOSAL: RESOLUTION CALLING FOR THE AMENDMENT OF THE COMPANY CODE OF
REGULATIONS TO OPT OUT OF THE OHIO CONTROL SHARE ACQUISITION STATUTE.
/ / FOR / / AGAINST / / ABSTAIN
FIFTH PROPOSAL: ELECTION OF DIRECTORS.
If the election of directors is not by cumulative voting, then the
undersigned directs that all of the Common Shares of the undersigned be voted as
follows all on the proposal to elect , , and
(the "United Dominion Nominees") as directors of the Company:
/ / FOR all United Dominion Nominees
/ / WITHHOLD AUTHORITY for all United Dominion Nominees
INSTRUCTION: To withhold authority to vote for the election of one or
more of the United Dominion Nominees, mark FOR above and write the
name(s) of the person(s) with respect to whom you wish to withhold
authority to vote here: ____________
If the election of directors is by cumulative voting, then the undersigned
directs that all of the Common Shares of the undersigned be voted on the
proposal to elect the United Dominion Nominees as directors of the
<PAGE> 40
Company as follows, in accordance with the Optimal Parent Voting Arrangement, as
described in the Proxy Statement:
/ / FOR all United Dominion Nominees
/ / WITHHOLD AUTHORITY for all United Dominion Nominees
INSTRUCTION: To withhold authority to vote for the election of one or
more of the United Dominion Nominees, mark FOR above and write the
name(s) of the person(s) with respect to whom you wish to withhold
authority to vote here: ____________
SIXTH PROPOSAL: RESOLUTION CALLING FOR THE RECESS OF THE SPECIAL MEETING.
/ / FOR / / AGAINST / / ABSTAIN
SEVENTH PROPOSAL: RESOLUTION CALLING FOR THE AMENDMENT OF THE COMPANY ARTICLES
OF INCORPORATION TO REPEAL ARTICLE SIXTH THEREOF.
/ / FOR / / AGAINST / / ABSTAIN
EIGHTH PROPOSAL: RESOLUTION CALLING FOR THE ADJOURNMENT OF THE SPECIAL MEETING.
/ / FOR / / AGAINST / / ABSTAIN
PLEASE MARK, SIGN, DATE AND RETURN THIS PROXY CARD
PROMPTLY IN THE ENCLOSED ENVELOPE PROVIDED
[Proxy Continued On Reverse]
<PAGE> 41
The proxies of the undersigned named above are authorized to vote, in their
discretion, upon such other matters as may properly come before the Special
Meeting and any adjournment or postponement thereof.
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED IN THE MANNER MARKED HEREIN
BY THE UNDERSIGNED. IF NO MARKING IS MADE AS TO ANY PROPOSAL OR ALL PROPOSALS,
THIS PROXY WILL BE VOTED "FOR" EACH OF THE EIGHT PROPOSALS DESCRIBED ABOVE. THE
UNDERSIGNED HEREBY ACKNOWLEDGES RECEIPT OF THE PROXY STATEMENT OF UNITED
DOMINION AND OPUS ACQUISITION DATED AUGUST , 1996, SOLICITING PROXIES FOR THE
SPECIAL MEETING.
All previous proxies given by the undersigned to vote at the Special
Meeting or at any adjournment or postponement thereof are hereby revoked.
Please sign exactly as name
appears on this Proxy:
--------------------------------------
(Signature)
--------------------------------------
(Signature, if jointly held)
Title:
--------------------------------------
Dated:
--------------------------------------,
1996
When shares are held by joint tenants,
both should sign. When signing as an
attorney, executor, administrator,
trustee or guardian, give full title
as such. If a corporation, sign in
full corporate name by President or
other authorized officer. If a
partnership, sign in partnership name
by authorized person.
PLEASE COMPLETE, SIGN, DATE AND MAIL THIS PROXY CARD PROMPTLY TO UNITED
DOMINION INDUSTRIES LIMITED, C/O MACKENZIE PARTNERS, INC., 156 FIFTH AVENUE, NEW
YORK, NEW YORK 10010 IN THE ENCLOSED ENVELOPE.
PARTICIPANTS IN THE ESOPS AND THE PLANS CAN VOTE SHARES HELD IN THE ESOPS
OR PLANS ON THEIR BEHALF ONLY BY INSTRUCTING THE ESOP TRUSTEE OR PLAN TRUSTEE,
AS APPLICABLE, ON THE FORM THAT SHOULD BE PROVIDED, BY THE ESOP TRUSTEE OR PLAN
TRUSTEE, AS APPLICABLE, TO PARTICIPANTS FOR THAT PURPOSE. ESOP PARTICIPANTS AND
PLAN PARTICIPANTS CANNOT VOTE SHARES ALLOCATED TO THEIR ESOP ACCOUNT OR PLAN
ACCOUNT BY EXECUTING THE ACCOMPANYING GOLD-STRIPED PROXY CARD.
