<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED COMMON STOCK PURCHASE RIGHTS)
OF
PRIMARK CORPORATION
AT
$38.00 NET PER SHARE
BY
MARQUEE ACQUISITION CORPORATION
AN INDIRECT WHOLLY OWNED SUBSIDIARY OF
THE THOMSON CORPORATION
---------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON JULY 12, 2000, UNLESS THE OFFER IS EXTENDED.
-------------------
THE OFFER IS BEING MADE PURSUANT TO THE TERMS OF AN AGREEMENT AND PLAN OF MERGER
DATED AS OF JUNE 5, 2000 (THE "MERGER AGREEMENT") AMONG THE THOMSON CORPORATION
("THOMSON"), MARQUEE ACQUISITION CORPORATION ("PURCHASER") AND PRIMARK
CORPORATION (THE "COMPANY").
---------------------
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (I) THERE HAVING BEEN VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER AT LEAST THE
NUMBER OF SHARES THAT SHALL CONSTITUTE FIFTY ONE PERCENT OF THE THEN OUTSTANDING
SHARES ON A FULLY DILUTED BASIS (INCLUDING, WITHOUT LIMITATION, ALL SHARES
ISSUABLE UPON THE CONVERSION OF ANY CONVERTIBLE SECURITIES OR UPON THE EXERCISE
OF ANY OPTIONS, WARRANTS, OR RIGHTS) (THE "MINIMUM CONDITION") AND (II) ALL
APPLICABLE WAITING PERIODS UNDER THE HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS
ACT OF 1976, AS AMENDED (THE "HSR ACT"), AND ANY APPLICABLE ANTITRUST ACTS OF
ANY OTHER JURISDICTION, INCLUDING THE UNITED KINGDOM AND THE FEDERAL REPUBLIC OF
GERMANY (THE "ANTITRUST ACTS"), HAVING EXPIRED OR BEEN TERMINATED PRIOR TO THE
EXPIRATION OF THE OFFER ("THE ANTITRUST CONDITION"). THE OFFER IS ALSO SUBJECT
TO CERTAIN OTHER CONDITIONS CONTAINED IN THIS OFFER TO PURCHASE. PLEASE READ
SECTIONS 1 AND 14, WHICH SET FORTH IN FULL THE CONDITIONS TO THE OFFER.
---------------------
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY DETERMINED THAT THE MERGER
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE OFFER AND THE
MERGER (EACH AS DEFINED HEREIN) ARE FAIR TO, AND IN THE BEST INTEREST OF, THE
HOLDERS OF SHARES OF COMPANY COMMON STOCK ("SHARES"), AND HAS APPROVED AND
ADOPTED THE MERGER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY,
INCLUDING EACH OF THE OFFER AND MERGER, AND HAS RECOMMENDED THAT THE HOLDERS OF
SHARES ACCEPT THE OFFER AND TENDER THEIR SHARES PURSUANT TO THE OFFER.
---------------------
IMPORTANT
ANY SHAREHOLDER DESIRING TO TENDER ALL OR ANY PORTION OF SUCH SHAREHOLDER'S
SHARES SHOULD EITHER (I) COMPLETE AND SIGN THE ACCOMPANYING LETTER OF
TRANSMITTAL (OR A MANUALLY SIGNED FACSIMILE THEREOF) IN ACCORDANCE WITH THE
INSTRUCTIONS IN THE LETTER OF TRANSMITTAL AND MAIL OR DELIVER IT TOGETHER WITH
THE CERTIFICATE(S) EVIDENCING ANY TENDERED SHARES AND ANY OTHER REQUIRED
DOCUMENTS, TO THE DEPOSITARY OR TENDER SUCH SHARES PURSUANT TO THE PROCEDURE FOR
BOOK-ENTRY TRANSFER SET FORTH IN SECTION 3 OF THIS OFFER OR (II) REQUEST SUCH
SHAREHOLDER'S BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR OTHER NOMINEE TO
EFFECT THE TRANSACTION FOR SUCH SHAREHOLDER. ANY SHAREHOLDER WHOSE SHARES ARE
REGISTERED IN THE NAME OF A BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR
OTHER NOMINEE MUST CONTACT SUCH BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY
OR OTHER NOMINEE IF SUCH SHAREHOLDER INTENDS TO TENDER SUCH SHARES.
A SHAREHOLDER INTENDING TO TENDER SHARES AND WHOSE CERTIFICATES EVIDENCING SUCH
SHARES ARE NOT IMMEDIATELY AVAILABLE, OR WHO CANNOT COMPLY WITH THE PROCEDURE
FOR BOOK-ENTRY TRANSFER ON A TIMELY BASIS, MAY TENDER SUCH SHARES BY FOLLOWING
THE PROCEDURE FOR GUARANTEED DELIVERY SET FORTH IN SECTION 3.
QUESTIONS OR REQUESTS FOR ASSISTANCE MAY BE DIRECTED TO THE INFORMATION AGENT OR
THE DEALER MANAGER AT THEIR RESPECTIVE ADDRESSES AND TELEPHONE NUMBERS SET FORTH
ON THE BACK COVER OF THIS OFFER TO PURCHASE. ADDITIONAL COPIES OF THIS OFFER TO
PURCHASE, THE LETTER OF TRANSMITTAL AND THE NOTICE OF GUARANTEED DELIVERY MAY
ALSO BE OBTAINED FROM THE INFORMATION AGENT.
------------------------
THE DEALER MANAGER FOR THE OFFER IS:
MORGAN STANLEY DEAN WITTER
JUNE 14, 2000
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
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<S> <C>
SUMMARY OF THE OFFER........................................ 1
INTRODUCTION................................................ 4
1. Terms of the Offer; Expiration Date................. 7
2. Acceptance for Payment and Payment for Shares....... 8
3. Procedures for Accepting the Offer and Tendering
Shares................................................. 10
4. Withdrawal Rights................................... 12
5. Certain Federal Income Tax Consequences............. 13
6. Price Range of Shares; Dividends.................... 14
7. Certain Information Concerning the Company.......... 14
8. Certain Information Concerning Purchaser and
Thomson................................................ 17
9. Financing of the Offer and the Merger............... 18
10. Background of the Offer; Contacts with the Company;
the Merger Agreement; the Shareholders Agreement;
the Change of Control Agreements; the
Confidentiality Agreement........................... 18
11. Purpose of the Offer; Plans for the Company After
the Offer and the Merger............................... 34
12. Dividends and Distributions......................... 36
13. Possible Effects of the Offer on the Market for
Shares, NYSE Listing, PCX Listing, Exchange Act
Registration and Margin Regulations................. 36
14. Certain Conditions of the Offer..................... 37
15. Certain Legal Matters and Regulatory Approvals...... 39
16. Fees and Expenses................................... 41
17. Miscellaneous....................................... 42
</TABLE>
<TABLE>
<S> <C>
Schedule I. Information Concerning Directors and Executive Officers of
Thomson and Purchaser
</TABLE>
<PAGE>
SUMMARY OF THE OFFER
THIS SUMMARY OF THE OFFER HIGHLIGHTS SELECTED INFORMATION FROM THIS OFFER TO
PURCHASE, AND MAY NOT CONTAIN ALL OF THE INFORMATION THAT IS IMPORTANT TO YOU.
TO BETTER UNDERSTAND OUR OFFER TO YOU AND FOR A COMPLETE DESCRIPTION OF THE
TERMS OF THE OFFER, YOU SHOULD READ THIS ENTIRE OFFER TO PURCHASE AND THE
ACCOMPANYING LETTER OF TRANSMITTAL CAREFULLY. QUESTIONS OR REQUESTS FOR
ASSISTANCE MAY BE DIRECTED TO THE INFORMATION AGENT OR THE DEALER MANAGER AT
THEIR ADDRESSES AND TELEPHONE NUMBERS LISTED ON THE LAST PAGE OF THIS OFFER TO
PURCHASE.
WHO IS OFFERING TO BUY MY SECURITIES?
- We are Marquee Acquisition Corporation, a newly formed Michigan
corporation and an indirect wholly owned subsidiary of The Thomson
Corporation ("Thomson"). We have been organized in connection with this
offer and have not carried on any activities other than in connection with
this offer.
- Thomson is a corporation incorporated in Ontario, Canada. Thomson
(www.thomson.com) is a leading, global e-information and solutions company
in the business and professional marketplace. Thomson's Legal & Regulatory
group, led by the West Group, is a leading provider of information and
software-based solutions to law, tax, accounting, human resources, and
other corporate professionals around the world. Thomson Financial provides
information services and software-based solutions to the worldwide
financial community. Thomson Learning is among the world's largest
providers of lifelong learning information, servicing the needs of
individuals, learning institutions and corporations. Thomson's Scientific,
Reference & Healthcare group provides high-value information and services
to researchers and other professionals in the academic, scientific,
government and healthcare marketplaces. Thomson's common shares are listed
on the Toronto and London Stock Exchanges.
WHAT ARE THE CLASSES AND AMOUNTS OF SECURITIES SOUGHT IN THIS OFFER?
- We are offering to purchase all the outstanding and issued shares of
common stock, no par value per share, of the Company, as well as the
purchase rights that are associated with the common stock. Please see the
"Introduction" and Section 1.
HOW MUCH ARE YOU OFFERING TO PAY AND WHAT IS THE FORM OF PAYMENT?
- We are offering to pay $38.00 per share, net to you in cash and without
interest. Please see "Introduction" and Section 1.
- If you tender your shares in the offer, you will not be obligated to pay
brokerage fees or commissions or, except as otherwise provided in
Instruction 6 of the Letter of Transmittal, stock transfer taxes with
respect to the sale of Shares. Please see the "Introduction."
WHAT ARE THE MOST SIGNIFICANT CONDITIONS OF THE OFFER?
- We are not obligated to purchase any shares unless at least 51% of the
outstanding shares are validly tendered and not withdrawn prior to the
expiration of the offer. Please see Sections 1 and 4.
- We are not obligated to purchase any shares unless and until the
applicable waiting period under the HSR Act and the other applicable
antitrust laws in other jurisdictions, including the United Kingdom and
the Federal Republic of Germany, have expired or been terminated. Please
see Section 15.
- Please read Sections 1 and 14 of the offer, which set forth in full the
conditions to the offer.
<PAGE>
DO YOU HAVE ENOUGH FINANCIAL RESOURCES TO MAKE PAYMENT?
- We will obtain all necessary funds to purchase the shares of the Company's
common stock from Thomson or one of Thomson's other subsidiaries. Thomson
and its subsidiaries will provide such funds from existing resources. For
a more detailed description of the financing of the offer and the merger,
see Section 9.
IS YOUR FINANCIAL CONDITION RELEVANT TO MY DECISION TO TENDER IN THE OFFER?
- Because the form of payment consists solely of cash and all of the funding
that will be needed has already been arranged, and also because of the
lack of any relevant historical information concerning Marquee Acquisition
Corporation, we do not think our financial condition is relevant to your
decision to tender in the offer.
HOW LONG DO I HAVE TO DECIDE WHETHER TO TENDER IN THE OFFER?
- You will have until at least 12:00 midnight, New York City time, on
July 12, 2000 to tender your shares of the Company's common stock. If you
cannot deliver everything that is required in order to make a valid tender
by that time, you may be able to use a guaranteed delivery procedure that
is described in Section 3.
CAN THE OFFER BE EXTENDED, AND UNDER WHAT CIRCUMSTANCES?
- We expressly reserve the right, in our sole discretion, but subject to the
terms of the Merger Agreement and applicable law, to extend the period of
time during which the offer remains open. We have agreed in the Merger
Agreement that we may extend the offer if certain conditions to the offer
have not been satisfied. Please see Section 1.
HOW WILL I BE NOTIFIED IF THE OFFER IS EXTENDED?
- If we decide to extend the offer, we will inform ChaseMellon Shareholder
Services, L.L.C., the Depositary, of that fact, and will issue a press
release giving the new expiration date no later than 9:00 a.m., New York
City time, on the day after the day on which the offer was previously
scheduled to expire. Please see Section 1.
HOW DO I TENDER MY SHARES?
To tender your shares in the offer, you must:
- complete and sign the accompanying Letter of Transmittal (or a manually
signed facsimile of the Letter of Transmittal) in accordance with the
instructions in the Letter of Transmittal and mail or deliver it together
with your share certificates and any other required documents, to the
Depositary;
- tender your shares pursuant to the procedure for book-entry transfer set
forth in Section 3; or
- if your share certificates are not immediately available or if you cannot
deliver your share certificates, and any other required documents, to
ChaseMellon, prior to the expiration of the offer, or you cannot complete
the procedure for delivery by book-entry transfer on a timely basis, you
may still tender your shares if you comply with the guaranteed delivery
procedures described in Section 3.
UNTIL WHAT TIME CAN I WITHDRAW PREVIOUSLY TENDERED SHARES?
- You may withdraw any previously tendered shares at any time prior to the
expiration of the offer, and, unless we have previously accepted them
pursuant to the offer, you may also withdraw any
2
<PAGE>
tender of shares of the Company common stock at any time after August 12,
2000. Please see Section 4.
HOW DO I WITHDRAW MY PREVIOUSLY TENDERED SHARES?
- In order to withdraw your tender of shares, you must deliver a written or
facsimile notice of withdrawal with the required information to
ChaseMellon while you still have the right to withdraw. If you tendered
shares by giving instructions to a broker or bank, you must instruct the
broker or bank to arrange for the withdrawal of your shares. Please see
Section 4.
WHAT DOES THE COMPANY'S BOARD OF DIRECTORS THINK OF THE OFFER?
- The Board of Directors of the Company has unanimously determined that the
offer and merger are fair to, and in the best interests of, the
shareholders of the Company, and has recommended that the shareholders
accept the offer.
WILL THE COMPANY CONTINUE AS A PUBLIC COMPANY?
- No. If the merger occurs, the Company will no longer be publicly owned.
Even if the merger does not occur, if we purchase all the tendered shares,
there may be so few remaining shareholders and publicly held shares that
the shares may no longer be eligible to be listed on the New York Stock
Exchange or other securities markets, there may not be a public trading
market for the shares and the Company may cease making filings with the
SEC or otherwise cease being required to comply with SEC rules relating to
publicly held companies. Please see Section 13.
WILL THE TENDER OFFER BE FOLLOWED BY A MERGER IF ALL THE SHARES ARE NOT
TENDERED?
- If we accept for payment and pay for at least 51% of the outstanding
shares on a fully diluted basis, we will merge with and into the Company.
If the merger occurs, the Company will become a wholly owned subsidiary of
Thomson, and each share that remains outstanding (other than any shares
held in the treasury of the Company, or owned by Thomson, Marquee
Acquisition Corporation or any of their subsidiaries, and any shares held
by stockholders seeking appraisal for their shares) will be canceled and
converted automatically into the right to receive $38.00 net per share, in
cash (or any greater amount per share paid pursuant to the offer).
IF I DECIDE NOT TO TENDER, HOW WILL THE OFFER AFFECT MY SHARES?
- If you decide not to tender your shares in the offer and the merger
occurs, you will receive in the merger the same amount of cash per share
as if you would have tendered your shares in the offer.
- If you decide not to tender your shares in the offer and the merger does
not occur, if we purchase all the tendered shares, there may be so few
remaining stockholders and publicly held shares that the shares will no
longer be eligible to be listed on the New York Stock Exchange or other
securities market, there may not be a public trading market for the shares
and the Company may cease making filings with the SEC or otherwise cease
being required to comply with SEC rules relating to publicly held
companies. Please see Section 13.
WHAT IS THE MARKET VALUE OF MY SHARES AS OF A RECENT DATE?
- On June 2, 2000, the last full trading day before we announced our offer,
the last reported closing price per share reported on the New York Stock
Exchange was $29.00 per share. See Section 7.
WITH WHOM MAY I TALK IF I HAVE QUESTIONS ABOUT THE OFFER?
- You can call Innisfree M&A Incorporated, the Information Agent, at
(888) 750-5834 or Morgan Stanley & Co. Incorporated, the Dealer Manager,
at (212) 761-6051. See the back cover of this Offer to Purchase.
3
<PAGE>
To the Holders of Common Stock of
Primark Corporation:
INTRODUCTION
Marquee Acquisition Corporation, a Michigan corporation ("Purchaser") and an
indirect wholly owned subsidiary of The Thomson Corporation, a corporation
organized under the laws of Ontario, Canada ("Thomson"), hereby offers to
purchase all the shares of common stock, no par value per share ("Common
Stock"), of Primark Corporation, a Michigan corporation (the "Company"), that
are issued and outstanding, together with the associated common stock purchase
rights (the "Rights" and, together with the Common Stock, the "Shares") issued
pursuant to the Rights Agreement, dated as of May 29, 1997, between the Company
and BankBoston, N.A., as Rights Agent (the "Rights Agreement"), for $38.00 per
Share, net to the seller in cash, without interest, upon the terms and subject
to the conditions set forth in this Offer to Purchase and in the related Letter
of Transmittal (which, together with this Offer to Purchase and any amendments
or supplements hereto or thereto, collectively constitute the "Offer"). Please
read Section 8 for additional information concerning Thomson and Purchaser.
Tendering shareholders who are record owners of their shares and tender
directly to the Depositary will not be obligated to pay brokerage fees or
commissions or, except as otherwise provided in Instruction 6 of the Letter of
Transmittal, stock transfer taxes with respect to the purchase of Shares by
Purchaser pursuant to the Offer. Nonetheless, any tendering shareholder or other
payee that fails to complete and sign the Substitute Form W-9, which is included
in the Letter of Transmittal, may be subject to a required back-up U.S. federal
income tax withholding of 31% of the gross proceeds payable to such shareholder
or other payee pursuant to the Offer. See Section 5. Purchaser or Thomson shall
pay all charges and expenses of ChaseMellon Shareholder Services, L.L.C. (the
"Depositary"), Innisfree M&A Incorporated (the "Information Agent") and Morgan
Stanley & Co. Incorporated (the "Dealer Manager") incurred in connection with
the Offer. See Section 16.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY DETERMINED THAT THE
MERGER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE OFFER
AND THE MERGER, ARE FAIR TO, AND IN THE BEST INTEREST OF, THE HOLDERS OF SHARES
OF COMPANY COMMON STOCK ("SHARES") AND HAS APPROVED AND ADOPTED THE MERGER
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING EACH OF THE OFFER
AND MERGER, AND HAS RECOMMENDED THAT THE HOLDERS OF SHARES ACCEPT THE OFFER AND
TENDER THEIR SHARES PURSUANT TO THE OFFER.
Deutsche Bank Securities Inc. ("Deutsche Bank") has delivered to the Board
of Directors of the Company its opinion to the effect that, as of the date
thereof, the consideration to be received by the holders of Shares in connection
with the Offer and the Merger is fair to them from a financial point of view. A
copy of the written opinion of Deutsche Bank is contained in the Company's
Solicitation/ Recommendation Statement on Schedule 14D-9 (the
"Schedule 14D-9"), which has been filed with the Securities and Exchange
Commission (the "Commission") and is being mailed to you concurrently herewith.
YOU ARE URGED TO READ THE OPINION CAREFULLY AND IN ITS ENTIRETY FOR A
DESCRIPTION OF THE ASSUMPTIONS MADE, MATTERS CONSIDERED AND LIMITS ON THE REVIEW
UNDERTAKEN BY DEUTSCHE BANK.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (I) THERE HAVING BEEN
VALIDLY TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER AT LEAST
THE NUMBER OF SHARES THAT SHALL CONSTITUTE 51% OF THE THEN OUTSTANDING SHARES ON
A FULLY DILUTED BASIS (INCLUDING, WITHOUT LIMITATION, ALL SHARES ISSUABLE UPON
THE CONVERSION OF ANY CONVERTIBLE SECURITIES OR UPON THE EXERCISE OF ANY
OPTIONS, WARRANTS, OR RIGHTS) (THE "MINIMUM CONDITION") AND (II) THE EXPIRATION
OF ANY APPLICABLE WAITING PERIOD UNDER THE HARD-SCOTT-RODINO ANTITRUST
IMPROVEMENTS ACT OF 1976, AS AMENDED (THE "HSR ACT"), AND ANY APPLICABLE
ANTITRUST ACTS OF ANY OTHER JURISDICTION, INCLUDING THE UNITED KINGDOM AND THE
4
<PAGE>
FEDERAL REPUBLIC OF GERMANY (THE "ANTITRUST ACTS"), HAVING EXPIRED OR BEEN
TERMINATED PRIOR TO THE EXPIRATION OF THE OFFER (THE "ANTITRUST CONDITION"). THE
OFFER IS ALSO SUBJECT TO CERTAIN OTHER CONDITIONS CONTAINED IN THIS OFFER TO
PURCHASE. PLEASE READ SECTIONS 1 AND 14, WHICH SET FORTH IN FULL THE CONDITIONS
TO THE OFFER.
The Offer is being made pursuant to an Agreement and Plan of Merger, dated
as of June 5, 2000 (the "Merger Agreement"), among Thomson, Purchaser and the
Company. The Merger Agreement provides, among other things, that as promptly as
practicable after the purchase of Shares pursuant to the Offer and the
satisfaction or, if permissible, waiver of the other conditions set forth in the
Merger Agreement and in accordance with the relevant provisions of the Michigan
Business Corporation Act ("Michigan Law"), Purchaser will be merged with and
into the Company (the "Merger"). As a result, the Company will continue as the
surviving corporation and will become an indirect wholly owned subsidiary of
Thomson. At the effective time of the Merger (the "Effective Time"), each Share
issued and outstanding immediately prior to the Effective Time (other than
Shares held in the treasury of the Company and other than Shares held by
shareholders who shall have demanded and perfected appraisal rights under
Michigan Law, if any) shall be canceled and converted automatically into the
right to receive $38.00 in cash, or any higher price that may be paid per Share
in the Offer, without interest. Shareholders who demand and fully perfect
appraisal rights under Michigan Law will be entitled to receive, in connection
with the Merger, cash for the fair value of their Shares as determined pursuant
to the procedures prescribed by Michigan Law. See Section 11. The Merger
Agreement is more fully described in Section 10. Certain federal income tax
consequences of the sale of Shares pursuant to the Offer and the Merger, as the
case may be, are described in Section 5.
Simultaneously with the execution of the Merger Agreement, Thomson and
Purchaser have entered into a Shareholders Agreement with Joseph E. Kasputys,
Stephen H. Curran and Michael R. Kargula, the Chief Executive Officer, Chief
Financial Officer and General Counsel, respectively, of the Company (the
"Shareholders Agreement") pursuant to which Messrs. Kasputys, Curran and Kargula
have agreed, among other things, to (i) tender all of the Shares owned by them,
(ii) vote all of the Shares owned by them in favor of the Merger, against any
action that would result in a material breach of any covenant, obligation,
agreement, representation or warranty of the Company under the Merger Agreement,
and against any action, agreement or transaction that would materially delay or
impair the ability of the Company to consummate the transactions provided for in
the Merger Agreement or any Acquisition Proposal (as defined in the Merger
Agreement) and (iii) grant an irrevocable proxy to Thomson and each of its
officers to vote and act (by written consent or otherwise) with respect to all
of the Shares owned by them at any meeting of the shareholders of the Company or
by written consent in lieu of any such meetings with regard to any matter
covered in (ii). See Section 10.
Simultaneously with the execution of the Merger Agreement,
Messrs. Kasputys, Curran and Kargula have entered into letter agreements with
the Company in which they amend their existing change of control agreements.
Pursuant to the terms of these letter agreements, Messrs. Kasputys, Curran and
Kargula agree not to terminate their employment as a result of their change in
status as officers of a public company prior to the later of the Effective Time
of the Merger and January 1, 2001. The agreements also provide that during the
term of the agreement and for a period equal to two years in the case of
Mr. Kasputys, and one year in the case of Messrs. Curran and Kargula, after the
termination or expiration of the individual's employment by the Company, however
caused, the individual shall not engage in the Company's business as conducted
on June 5, 2000 or as it may be conducted during the course of the individual's
employment, or a business competitive with the Company's business; assist any
person in conducting a business competitive with the Company's business; or
interfere with business relationships between the Company and customers of or
suppliers to the Company's business.
In addition, simultaneous with the execution of the Merger Agreement,
various subsidiaries of the Company entered into employment agreements or
amendments thereto with certain of the executives
5
<PAGE>
employed by such subsidiary. Those employment agreements provide for the
continued employment of each such executive and that each such executive, in the
event of the termination of employment, for varying periods not compete with the
business of the Company as conducted on June 5, 2000 or during the period of
such executive's employment with the Company or any of its subsidiaries, assist
any person in doing the same or solicit or encourage any employee of the Company
or any of its subsidiaries to leave the employment of the Company or any of its
subsidiaries. See Section 10.
The Merger Agreement provides that promptly upon the purchase by Purchaser
of Shares pursuant to the Offer, and from time to time thereafter, Purchaser
will be entitled to designate up to such number of directors, rounded up to the
next whole number, on the Board as shall give Purchaser representation on the
Board equal to the product of the total number of directors on the Board (giving
effect to the directors elected pursuant to the Merger Agreement) multiplied by
the percentage that the aggregate number of Shares then beneficially owned by
Purchaser or any affiliate of Purchaser following such purchase bears to the
total number of Shares then outstanding. In the Merger Agreement, the Company
has agreed, at such time, promptly to take all actions within its power
reasonably necessary to cause Purchaser's designees to be elected as directors
of the Company, including increasing the size of the Board or securing the
resignations of incumbent directors, or both.
The consummation of the Merger is subject to the satisfaction or waiver of
certain conditions, including the consummation of the Offer, and, if necessary,
the approval and adoption of the Merger Agreement and the Merger by the
requisite vote of the shareholders of the Company. For a more detailed
description of the conditions to the Merger, please see Section 10. Under the
Company's Articles of Incorporation and Michigan Law, the affirmative vote of
the holders of at least a majority of the outstanding Shares is required to
approve and adopt the Merger Agreement and the Merger. Consequently, if
Purchaser acquires (pursuant to the Offer or otherwise) at least a majority of
the outstanding Shares, then Purchaser will have sufficient voting power to
approve and adopt the Merger Agreement and the Merger without the affirmative
vote of any other shareholder. See Sections 10 and 11.
Under Michigan Law, if Purchaser acquires, pursuant to the Offer or
otherwise, at least 90% of the then outstanding Shares, Purchaser will be able
to approve and adopt the Merger Agreement and the Merger without the necessity
of a vote of the Company's shareholders. In such event, Thomson, Purchaser and
the Company have agreed to take, at the request of Purchaser, all necessary and
appropriate action to cause the Merger to become effective in accordance with
Michigan Law as promptly as reasonably practicable after such acquisition,
without a meeting of the Company's shareholders. If, however, Purchaser does not
acquire at least 90% of the then outstanding Shares and a vote of the Company's
shareholders is required under Michigan Law, a significantly longer period of
time will be required to effect the Merger. See Section 11.
The Company has advised Purchaser that as of June 9, 2000, 20,308,103 Shares
were issued and outstanding, 4,905,293 Shares were subject to outstanding stock
options and no Shares were held in the treasury of the Company. As a result, as
of such date, the Minimum Condition would be satisfied if Purchaser acquired
12,858,832 Shares. Also, as of such date, Purchaser could cause the Merger to
become effective in accordance with Michigan Law, without the necessity of
calling a meeting of the Company's shareholders or requiring a vote of the
Company's shareholders, if Purchaser acquired 18,277,293 Shares.
No appraisal rights are available in connection with the Offer; however,
shareholders may have appraisal rights in connection with the Merger regardless
of whether the Merger is consummated with or without a vote of the Company's
shareholders. See Section 11.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION THAT SHOULD BE READ CAREFULLY BEFORE YOU MAKE ANY DECISION
WITH RESPECT TO THE OFFER.
6
<PAGE>
1. TERMS OF THE OFFER; EXPIRATION DATE.
Upon the terms and subject to the conditions of the Offer (including any
terms and conditions of any extension or amendment), Purchaser will accept for
payment and pay for all Shares validly tendered (and not withdrawn in accordance
with the procedures set forth in Section 4) on or prior to the Expiration Date.
"Expiration Date" means 12:00 midnight, New York City time, on July 12, 2000,
unless and until Purchaser (subject to the terms and conditions of the Merger
Agreement) shall have extended the period during which the Offer is open, in
which case Expiration Date shall mean the latest time and date at which the
Offer, as may be extended by Purchaser, shall expire.
The Offer is subject to the conditions set forth under Section 14, including
the satisfaction of the Minimum Condition and the Antitrust Condition. Subject
to the applicable rules and regulations of the Commission and subject to the
terms and conditions of the Merger Agreement (which provides that the Minimum
Condition may not be waived), Purchaser expressly reserves the right to waive
any such condition in whole or in part, in its sole discretion, and also
expressly reserves the right to increase the price per Share payable in the
Offer and to make any other changes in the terms and conditions of the Offer;
PROVIDED, HOWEVER, that the Purchaser may not decrease the price per Share
payable in the Offer, change the form of consideration payable in the Offer,
reduce the maximum number of Shares to be purchased in the Offer, impose
conditions to the Offer in addition to those set forth in Section 14, modify or
amend any condition to the Offer in any manner that is materially adverse to the
holders of Shares, or, except as provided in the Merger Agreement or required by
any rule, regulation, interpretation or position of the Commission, change the
expiration date of the Offer.
The Merger Agreement provides that Purchaser may, without the consent of the
Company, (i) extend the Offer beyond the scheduled expiration date, which shall
be 20 business days following the commencement of the Offer, if, at the
scheduled expiration of the Offer, any of the conditions to Purchaser's
obligation to accept for payment Shares, shall not be satisfied or waived, until
such condition is satisfied or waived (except that the Minimum Condition may not
be waived), provided that no such extension shall extend the offer beyond
October 31, 2000, (ii) extend the Offer for any period required by any rule,
regulation or interpretation of the Commission, or the staff thereof, applicable
to the Offer, or (iii) on one or more occasions, extend the Offer for one or
more periods, each not to exceed two business days and, in no event, in excess
of an aggregate period of 10 business days beyond the latest applicable date
that would otherwise be permitted under clause (i) or (ii) of this sentence, if,
as of such date, all of the conditions to Purchaser's obligations to accept
Shares for payment are satisfied or waived, but the number of Shares validly
tendered and not withdrawn pursuant to the Offer equals 80% or more, but less
than 90% of outstanding Shares on a fully diluted basis. The Merger Agreement
also provides that, if, on the initial scheduled expiration date of the Offer,
the sole condition remaining unsatisfied is the failure of the waiting period
under the Antitrust Acts to have expired or been terminated, then Purchaser
shall extend the Offer from time to time until the earlier to occur of
(i) December 31, 2000 and (ii) the fifth business day after the expiration or
termination of the applicable waiting periods under the Antitrust Acts. During
any such extension, all Shares previously tendered and not withdrawn will remain
subject to the Offer and subject to the right of a tendering shareholder to
withdraw such shareholder's Shares. See Section 4. Under no circumstances will
interest be paid on the purchase price for tendered Shares, whether or not the
Offer is extended. Any extension of the Offer may be effected by Purchaser
giving oral or written notice of such extension to the Depositary.
Purchaser shall pay for all Shares validly tendered and not withdrawn
promptly following the acceptance of Shares for payment pursuant to the Offer.
Notwithstanding the immediately preceding sentence and subject to the applicable
rules of the Commission and the terms and conditions of the Offer, Purchaser
also expressly reserves the right to delay payment for Shares in order to comply
in whole or in part with applicable laws (any such delay shall be effected in
compliance with Rule 14e-1(c) under the Securities Exchange Act of 1934, as
amended (the "Exchange Act"), which requires Purchaser to pay the
7
<PAGE>
consideration offered or to return Shares deposited by or on behalf of
shareholders promptly after the termination or withdrawal of the Offer).
Any such extension, delay, termination, waiver or amendment will be followed
as promptly as practicable by public announcement thereof, such announcement in
the case of an extension to be made no later than 9:00 a.m., New York City time,
on the next business day after the previously scheduled Expiration Date. Subject
to applicable law (including Rules 14d-4(c), 14d-6(d) and 14e-1 under the
Exchange Act, which require that material changes be promptly disseminated to
shareholders in a manner reasonably designed to inform them of such changes) and
without limiting the manner in which Purchaser may choose to make any public
announcement, Purchaser will have no obligation to publish, advertise or
otherwise communicate any such public announcement other than by issuing a press
release to the Dow Jones News Service or the Public Relations Newswire.
If Purchaser makes a material change in the terms of the Offer or the
information concerning the Offer, or if it waives a material condition of the
Offer, Purchaser will extend the Offer to the extent required by
Rules 14d-4(c), 14d-6(d) and 14e-1 under the Exchange Act. Subject to the terms
of the Merger Agreement, if, prior to the Expiration Date, Purchaser should
decide to increase the consideration being offered in the Offer, such increase
in the consideration being offered will be applicable to all shareholders whose
Shares are accepted for payment pursuant to the Offer and, if at the time notice
of any such increase in the consideration being offered is first published, sent
or given to holders of such Shares, the Offer is scheduled to expire at any time
earlier than the period ending on the tenth business day from and including the
date that such notice is first so published, sent or given, the Offer will be
extended at least until the expiration of such ten business day period.
For purposes of the Offer, a "business day" means any day on which the
principal offices of the Commission in Washington, D.C. are open to accept
filings, or, in the case of determining a date when any payment is due, any day
on which banks are not required or authorized to close in The City of New York,
and consists of the time period from 12:01 a.m. through 12:00 midnight, New York
City time.
The Company has provided Purchaser with the Company's shareholder list and
security position listings, including the most recent list of names, addresses
and security positions of non-objecting beneficial owners in the possession of
the Company, for the purpose of disseminating the Offer to holders of Shares.
This Offer to Purchase and the related Letter of Transmittal will be mailed by
Purchaser to record holders of Shares whose names appear on the Company's
shareholder list and will be furnished, for subsequent transmittal to beneficial
owners of Shares, to brokers, dealers, commercial banks, trust companies and
similar persons whose names, or the names of whose nominees, appear on the
shareholder list or, if applicable, who are listed as participants in a clearing
agency's security position listing.
2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES.
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any such extension or
amendment), Purchaser will accept for payment all Shares validly tendered (and
not properly withdrawn in accordance with Section 4) prior to the Expiration
Date promptly after the occurrence of the Expiration Date. Purchaser shall pay
for all Shares validly tendered and not withdrawn promptly following the
acceptance of Shares for payment pursuant to the Offer. Notwithstanding the
immediately preceding sentence and subject to applicable rules and regulations
of the Commission and the terms of the Merger Agreement, Purchaser expressly
reserves the right to delay payment for Shares in order to comply in whole or in
part with applicable laws. See Sections 1 and 15.
In all cases, payment for Shares tendered and accepted for payment pursuant
to the Offer will be made only after timely receipt by the Depositary of
(i) the certificates evidencing such Shares (the "Share Certificates") or timely
confirmation (a "Book-Entry Confirmation") of a book-entry transfer of such
Shares into the Depositary's account at The Depository Trust Company (the
"Book-Entry Transfer
8
<PAGE>
Facility") pursuant to the procedures set forth in Section 3, (ii) the Letter of
Transmittal (or a manually signed facsimile thereof), properly completed and
duly executed, with any required signature guarantees or an Agent's Message (as
defined below), in connection with the book-entry transfer and (iii) any other
documents required under the Letter of Transmittal. The term "Agent's Message"
means a message, transmitted by the Book-Entry Transfer Facility to, and
received by, the Depositary and forming a part of the Book-Entry Confirmation
which states that the Book-Entry Transfer Facility has received an express
acknowledgment from the participant in the Book-Entry Transfer Facility
tendering the Shares that are the subject of such Book-Entry Confirmation, that
such participant has received and agrees to be bound by the Letter of
Transmittal and that Purchaser may enforce such agreement against such
participant.
On June 12, 2000, Thomson filed with the Federal Trade Commission (the
"FTC") and the Antitrust Division of the Department of Justice (the "Antitrust
Division") a Premerger Notification and Report Form under the HSR Act with
respect to the Offer. Accordingly, the statutory waiting period under the HSR
Act applicable to the Offer will expire at 11:59 p.m., New York City time, on
June 27, 2000, unless extended by the FTC and the Antitrust Division. The FTC or
the Antitrust Division may extend such waiting period by requesting additional
information from Thomson with respect to the Offer. If such a request is made,
the waiting period will expire at 11:59 p.m., New York City time, on the tenth
calendar day after substantial compliance with such a request. Thereafter, the
waiting period may only be extended by court order or with the consent of
Thomson. The waiting period under the HSR Act may be terminated prior to
expiration by the FTC and the Antitrust Division. Thomson has requested early
termination of the waiting period, although there can be no assurance that this
request will be granted.
Thomson and the Company intend to provide notice of the Merger to the Office
of Fair Trading (the "OFT") in the United Kingdom as soon as possible. After an
initial review of the plan of merger by the OFT, which may last for several
weeks, the Secretary of State for Trade and Industry in the United Kingdom will
decide whether or not to refer the merger to the Competition Commission for a
full investigation. Reference to the Competition Commission is normally made on
competition grounds and the Competition Commission is usually given a period of
3 to 4 months to complete its report, which is then published by the Secretary
of State for Trade and Industry approximately one month later. If following
reference to the Competition Commission it finds that the merger may operate
against the public interest, the Secretary of State for Trade and Industry in
the United Kingdom may prohibit its consummation, or order partial divestiture,
or may accept other undertakings from the companies concerned.
The parties intend to notify the proposed merger to the German Federal
Cartel Office (the "FCO") as soon as possible. After an initial review of the
proposed merger by the FCO, which may last for 1 month, the FCO will decide
whether to clear the proposed merger or open a second stage investigation, which
may last for a further period of 3 months. If following the investigation, the
FCO has found that the proposed merger would create or strengthen a dominant
position in Germany, the FCO may take such actions as it deems necessary or
desirable in the public interest to prevent the proposed merger from being
implemented in respect of the German market.
Thomson and the Company conduct operations in a number of jurisdictions
where other regulatory filings or approvals may be required or advisable in
connection with the completion of the merger. Thomson and the Company are
currently in the process of reviewing whether any such filings or approvals are
in fact required. It is possible that one or more of these filings may not be
made, or one or more of the approvals that are not required to be obtained prior
to the Effective Time, may not be obtained prior to the merger.
See Section 15 for additional information regarding the Antitrust Acts.
For purposes of the Offer, Purchaser will be deemed to have accepted for
payment (and thereby purchased) Shares validly tendered and not properly
withdrawn as, if and when Purchaser gives oral or written notice to the
Depositary of Purchaser's acceptance for payment of such Shares pursuant to the
Offer. Upon the terms and subject to the conditions of the Offer, payment for
Shares accepted for
9
<PAGE>
payment pursuant to the Offer will be made by deposit of the purchase price
therefor with the Depositary, which will act as agent for tendering shareholders
for the purpose of receiving payments from Purchaser and transmitting such
payments to tendering shareholders whose Shares have been accepted for payment.
UNDER NO CIRCUMSTANCES WILL INTEREST ON THE PURCHASE PRICE FOR SHARES BE PAID,
REGARDLESS OF ANY DELAY IN MAKING SUCH PAYMENT.
If any tendered Shares are not accepted for payment for any reason pursuant
to the terms and conditions of the Offer, or if Share Certificates are submitted
evidencing more Shares than are tendered, Share Certificates evidencing
unpurchased Shares will be returned, without expense to the tendering
shareholder (or, in the case of Shares tendered by book-entry transfer into the
Depositary's account at the Book-Entry Transfer Facility pursuant to the
procedure set forth in Section 3, such Shares will be credited to an account
maintained at the Book-Entry Transfer Facility), as promptly as practicable
following the expiration or termination of the Offer.
Purchaser reserves the right to transfer or assign, in whole or from time to
time in part, to one or more of its affiliates, the right to purchase all or any
portion of the Shares tendered pursuant to the Offer, but any such transfer or
assignment will not relieve Purchaser of its obligations under the Offer and
will in no way prejudice the rights of tendering shareholders to receive payment
for Shares validly tendered and accepted for payment pursuant to the Offer.
3. PROCEDURES FOR ACCEPTING THE OFFER AND TENDERING SHARES.
In order for a holder of Shares to tender Shares validly pursuant to the
Offer, the Letter of Transmittal (or a manually signed facsimile thereof),
properly completed and duly executed, together with any required signature
guarantees or, in the case of a book-entry transfer, an Agent's Message, and any
other documents required by the Letter of Transmittal, must be received by the
Depositary at one of its addresses set forth on the back cover of this Offer to
Purchase and either (i) the Share Certificates evidencing tendered Shares must
be received by the Depositary at such address or such Shares must be tendered
pursuant to the procedure for book-entry transfer described below and a
Book-Entry Confirmation must be received by the Depositary (including an Agent's
Message if the tendering shareholder has not delivered a Letter of Transmittal),
in each case prior to the Expiration Date, or (ii) the tendering shareholder
must comply with the guaranteed delivery procedures described below.
THE METHOD OF DELIVERY OF SHARE CERTIFICATES AND ALL OTHER REQUIRED
DOCUMENTS, INCLUDING DELIVERY THROUGH THE BOOK-ENTRY TRANSFER FACILITY, IS AT
THE OPTION AND RISK OF THE TENDERING SHAREHOLDER, AND THE DELIVERY WILL BE
DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF DELIVERY IS BY
MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS
RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY
DELIVERY.
BOOK-ENTRY TRANSFER. The Depositary will establish an account with respect
to the Shares at the Book-Entry Transfer Facility for purposes of the Offer
within two business days after the date of this Offer to Purchase. Any financial
institution that is a participant in the system of the Book-Entry Transfer
Facility may make a book-entry delivery of Shares by causing the Book-Entry
Transfer Facility to transfer such Shares into the Depositary's account at the
Book-Entry Transfer Facility in accordance with the Book-Entry Transfer
Facility's procedures for such transfer. However, although delivery of Shares
may be effected through book-entry transfer at the Book-Entry Transfer Facility,
the Letter of Transmittal (or a manually signed facsimile thereof), properly
completed and duly executed, together with any required signature guarantees, or
an Agent's Message, and any other required documents, must, in any case, be
received by the Depositary at one of its addresses set forth on the back cover
of this Offer to Purchase prior to the Expiration Date, or the tendering
shareholder must comply with the guaranteed delivery procedure described below.
DELIVERY OF DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE
DELIVERY TO THE DEPOSITARY.
10
<PAGE>
SIGNATURE GUARANTEES. Signatures on all Letters of Transmittal must be
guaranteed by a firm that is a member of the Security Transfer Agent Medallion
Signature Program, or by any other "eligible guarantor institution," as such
term is defined in Rule 17Ad-15 under the Exchange Act (each of the foregoing
being referred to as an "Eligible Institution"), except in cases where Shares
are tendered (i) by a registered holder of Shares who has not completed either
the box entitled "Special Payment Instructions" or the box entitled "Special
Delivery Instructions" on the Letter of Transmittal or (ii) for the account of
an Eligible Institution. If a Share Certificate is registered in the name of a
person other than the signer of the Letter of Transmittal, or if payment is to
be made, or a Share Certificate not accepted for payment or not tendered is to
be returned, to a person other than the registered holder(s), then the Share
Certificate must be endorsed or accompanied by appropriate stock powers, in
either case signed exactly as the name(s) of the registered holder(s) appear on
the Share Certificate, with the signature(s) on such Share Certificate or stock
powers guaranteed by an Eligible Institution. See Instructions 1 and 5 of the
Letter of Transmittal.
GUARANTEED DELIVERY. If a shareholder desires to tender Shares pursuant to
the Offer and such shareholder's Share Certificates evidencing such Shares are
not immediately available or such shareholder cannot deliver the Share
Certificates and all other required documents to the Depositary prior to the
Expiration Date, or such shareholder cannot complete the procedure for delivery
by book-entry transfer on a timely basis, such Shares may nevertheless be
tendered, provided that all the following conditions are satisfied:
(i) such tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form made available by Purchaser, is received
prior to the Expiration Date by the Depositary as provided below; and
(iii) the Share Certificates (or a Book-Entry Confirmation) evidencing
all tendered Shares, in proper form for transfer, in each case together with
the Letter of Transmittal (or a manually signed facsimile thereof), properly
completed and duly executed, with any required signature guarantees or, in
the case of a book-entry transfer, an Agent's Message, and any other
documents required by the Letter of Transmittal are received by the
Depositary within three trading days after the date of execution of such
Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand or mail or by
facsimile transmission to the Depositary and must include a guarantee by an
Eligible Institution in the form set forth in the form of Notice of Guaranteed
Delivery made available by Purchaser.
In all cases, payment for Shares tendered and accepted for payment pursuant
to the Offer will be made only after timely receipt by the Depositary of the
Share Certificates evidencing such Shares, or a Book-Entry Confirmation of the
delivery of such Shares, and the Letter of Transmittal (or a manually signed
facsimile thereof), properly completed and duly executed, with any required
signature guarantees or, in the case of a book-entry transfer, an Agent's
Message, and any other documents required by the Letter of Transmittal.
DETERMINATION OF VALIDITY. ALL QUESTIONS AS TO THE FORM OF DOCUMENTS AND
THE VALIDITY, FORM, ELIGIBILITY (INCLUDING TIME OF RECEIPT) AND ACCEPTANCE FOR
PAYMENT OF ANY TENDER OF SHARES WILL BE DETERMINED BY PURCHASER, IN ITS SOLE
DISCRETION, WHICH DETERMINATION SHALL BE FINAL AND BINDING ON ALL PARTIES.
Purchaser reserves the absolute right to reject any and all tenders determined
by it not to be in proper form or the acceptance for payment of which may, in
the opinion of its counsel, be unlawful. Purchaser also reserves the absolute
right to waive any condition of the Offer to the extent permitted by applicable
law and the Merger Agreement or any defect or irregularity in the tender of any
Shares of any particular shareholder, whether or not similar defects or
irregularities are waived in the case of other shareholders. NO TENDER OF SHARES
WILL BE DEEMED TO HAVE BEEN VALIDLY MADE UNTIL ALL DEFECTS AND IRREGULARITIES
HAVE BEEN CURED OR WAIVED. NONE OF PURCHASER, THOMSON OR ANY OF THEIR RESPECTIVE
AFFILIATES OR ASSIGNS, THE DEPOSITARY, THE INFORMATION AGENT, THE DEALER MANAGER
OR ANY OTHER PERSON WILL BE UNDER ANY DUTY TO GIVE NOTIFICATION OF
11
<PAGE>
ANY DEFECTS OR IRREGULARITIES IN TENDERS OR INCUR ANY LIABILITY FOR FAILURE TO
GIVE ANY SUCH NOTIFICATION. Purchaser's interpretation of the terms and
conditions of the Offer (including the Letter of Transmittal and the
instructions thereto) will be final and binding.
A tender of Shares pursuant to any of the procedures described above will
constitute the tendering shareholder's acceptance of the terms and conditions of
the Offer, as well as the tendering shareholder's representation and warranty to
Purchaser that (i) such shareholder has the full power and authority to tender,
sell, assign and transfer the tendered Shares (and any and all other Shares or
other securities issued or issuable in respect of such Shares), and (ii) when
the same are accepted for payment by Purchaser, Purchaser will acquire good and
unencumbered title thereto, free and clear of all liens, restrictions, charges
and encumbrances and not subject to any adverse claims.
The acceptance for payment by Purchaser of Shares pursuant to any of the
procedures described above will constitute a binding agreement between the
tendering shareholder and Purchaser upon the terms and subject to the conditions
of the Offer.
APPOINTMENT AS PROXY. By executing the Letter of Transmittal as set forth
above, a tendering shareholder irrevocably appoints designees of Purchaser as
such shareholder's agents, attorneys-in-fact and proxies, each with full power
of substitution, in the manner set forth in the Letter of Transmittal, to the
full extent of such shareholder's rights with respect to the Shares tendered by
such shareholder and accepted for payment by Purchaser (and with respect to any
and all other Shares or other securities issued or issuable in respect of such
Shares on or after June 5, 2000). All such powers of attorney and proxies will
be considered irrevocable and coupled with an interest in the tendered Shares.
Such appointment will be effective when, and only to the extent that, Purchaser
accepts such Shares for payment. Upon such acceptance for payment, all prior
powers of attorney and proxies given by such shareholder with respect to such
Shares (and such other Shares and securities) will be revoked, without further
action, and no subsequent powers of attorney or proxies may be given nor any
subsequent written consent executed by such shareholder (and, if given or
executed, will not be deemed to be effective) with respect thereto. The
designees of Purchaser will, with respect to the Shares for which the
appointment is effective, be empowered to exercise all voting and other rights
of such shareholder as they in their sole discretion may deem proper at any
annual or special meeting of the Company's shareholders or any adjournment or
postponement thereof, by written consent in lieu of any such meeting or
otherwise. Purchaser reserves the right to require that, in order for Shares to
be deemed validly tendered, immediately upon Purchaser's payment for such
Shares, Purchaser must be able to exercise full voting rights with respect to
such Shares (and such other Shares and securities).
UNDER THE "BACKUP WITHHOLDING" PROVISIONS OF U.S. FEDERAL INCOME TAX LAW,
THE DEPOSITARY MAY BE REQUIRED TO WITHHOLD 31% OF ANY PAYMENTS OF CASH PURSUANT
TO THE OFFER. TO PREVENT BACKUP FEDERAL INCOME TAX WITHHOLDING WITH RESPECT TO
PAYMENT TO CERTAIN SHAREHOLDERS OF THE PURCHASE PRICE OF SHARES PURCHASED
PURSUANT TO THE OFFER, EACH SUCH SHAREHOLDER MUST PROVIDE THE DEPOSITARY WITH
SUCH SHAREHOLDER'S CORRECT TAXPAYER IDENTIFICATION NUMBER AND CERTIFY THAT SUCH
SHAREHOLDER IS NOT SUBJECT TO BACKUP FEDERAL INCOME TAX WITHHOLDING BY
COMPLETING THE SUBSTITUTE FORM W-9 IN THE LETTER OF TRANSMITTAL. SEE INSTRUCTION
10 OF THE LETTER OF TRANSMITTAL.
4. WITHDRAWAL RIGHTS.
Tenders of Shares made pursuant to the Offer are irrevocable except that
such Shares may be withdrawn at any time prior to the Expiration Date and,
unless theretofore accepted for payment by Purchaser pursuant to the Offer, may
also be withdrawn at any time after August 12, 2000. If Purchaser extends the
Offer, is delayed in its acceptance for payment of Shares or is unable to accept
Shares for payment pursuant to the Offer for any reason, then, without prejudice
to Purchaser's rights under the Offer, the Depositary may, nevertheless, on
behalf of Purchaser, retain tendered Shares, and such Shares may not be
withdrawn except to the extent that tendering shareholders are entitled to
withdrawal rights as
12
<PAGE>
described in this Section 4, subject to Rule 14e-1(c) under the Exchange Act.
Any such delay will be by an extension of the Offer to the extent required by
law.
For a withdrawal to be effective, a written or facsimile transmission notice
of withdrawal must be timely received by the Depositary at one of its addresses
set forth on the back cover page of this Offer to Purchase. Any such notice of
withdrawal must specify the name of the person who tendered the Shares to be
withdrawn, the number of Shares to be withdrawn and the name of the registered
holder of such Shares, if different from that of the person who tendered such
Shares. If Share Certificates evidencing Shares to be withdrawn have been
delivered or otherwise identified to the Depositary, then, prior to the physical
release of such Share Certificates, the serial numbers shown on such Share
Certificates must be submitted to the Depositary and the signature(s) on the
notice of withdrawal must be guaranteed by an Eligible Institution, unless such
Shares have been tendered for the account of an Eligible Institution. If Shares
have been tendered pursuant to the procedure for book-entry transfer as set
forth in Section 3, any notice of withdrawal must specify the name and number of
the account at the Book-Entry Transfer Facility to be credited with the
withdrawn Shares.
ALL QUESTIONS AS TO THE FORM AND VALIDITY (INCLUDING TIME OF RECEIPT) OF ANY
NOTICE OF WITHDRAWAL WILL BE DETERMINED BY PURCHASER, IN ITS SOLE DISCRETION,
WHOSE DETERMINATION WILL BE FINAL AND BINDING. NONE OF PURCHASER, THOMSON OR ANY
OF THEIR RESPECTIVE AFFILIATES OR ASSIGNS, THE DEPOSITARY, THE INFORMATION
AGENT, THE DEALER MANAGER OR ANY OTHER PERSON WILL BE UNDER ANY DUTY TO GIVE ANY
NOTIFICATION OF ANY DEFECTS OR IRREGULARITIES IN ANY NOTICE OF WITHDRAWAL OR
INCUR ANY LIABILITY FOR FAILURE TO GIVE ANY SUCH NOTIFICATION.
Withdrawals of Shares may not be rescinded. Any Shares properly withdrawn
will thereafter be deemed not to have been validly tendered for purposes of the
Offer. Notwithstanding the foregoing, withdrawn Shares may be re-tendered at any
time prior to the Expiration Date by following one of the procedures described
in Section 3.
5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES.
The following is a summary of the principal federal income tax consequences
of the Offer and the Merger to holders whose Shares are purchased pursuant to
the Offer or whose Shares are converted into the right to receive cash in the
Merger (whether upon receipt of the Merger Consideration or pursuant to the
proper exercise of dissenter's rights). The discussion applies only to holders
of Shares in whose hands Shares are capital assets, and may not apply to Shares
received pursuant to the exercise of employee stock options or otherwise as
compensation, or to holders of Shares who are not citizens or residents of the
United States of America.
THE TAX DISCUSSION SET FORTH BELOW IS INCLUDED FOR GENERAL INFORMATION
PURPOSES ONLY AND IS BASED UPON PRESENT LAW. BECAUSE INDIVIDUAL CIRCUMSTANCES
MAY DIFFER, EACH HOLDER OF SHARES SHOULD CONSULT SUCH HOLDER'S OWN TAX ADVISOR
TO DETERMINE THE APPLICABILITY OF THE RULES DISCUSSED HEREIN TO SUCH SHAREHOLDER
AND THE PARTICULAR TAX EFFECTS OF THE OFFER AND THE MERGER, INCLUDING THE
APPLICATION AND EFFECT OF OTHER FEDERAL, STATE, LOCAL AND OTHER TAX LAWS.
The receipt of the offer price and the receipt of cash pursuant to the
Merger (whether as Merger Consideration or pursuant to the proper exercise of
dissenter's rights) will be a taxable transaction for federal income tax
purposes (and also may be a taxable transaction under applicable state, local
and other income tax laws). In general, for federal income tax purposes, a
holder of Shares will recognize gain or loss equal to the difference between
such holder's adjusted tax basis in the Shares sold pursuant to the Offer or
converted to cash in the Merger and the amount of cash received therefor. Gain
or loss must be determined separately for each block of Shares (i.e., Shares
acquired at the same cost in a single transaction) sold pursuant to the Offer or
converted to cash in the Merger. Such gain or loss will be capital gain or loss.
Individual holders generally will be subject to tax on the net amount of such
gain at a maximum rate of 20% provided such holder's holding period for the
Shares exceeds 12 months. Special rules (and generally lower maximum rates)
apply to individuals in lower tax brackets. The deduction of
13
<PAGE>
capital losses is subject to certain limitations. Shareholders should consult
their own tax advisors in this regard.
Payments in connection with the Offer or the Merger may be subject to backup
withholding at a 31% rate. Backup withholding generally applies if a shareholder
(i) fails to furnish such shareholder's social security number or taxpayer
identification number ("TIN"), (ii) furnishes an incorrect TIN, (iii) fails
properly to report interest or dividends or (iv) under certain circumstances,
fails to provide a certified statement, signed under penalties of perjury, that
the TIN provided is such shareholder's correct number and that such shareholder
is not subject to backup withholding. Backup withholding is not an additional
tax but merely an advance payment, which may be refunded to the extent it
results in an overpayment of tax. Certain persons, including corporations and
financial institutions generally, are exempt from backup withholding. Certain
penalties apply for failure to furnish correct information and for failure to
include the reportable payments in income. Each shareholder should consult with
such shareholder's own tax advisor as to such shareholder's qualifications for
exemption from withholding and the procedure for obtaining such exemption.
6. PRICE RANGE OF SHARES; DIVIDENDS.
The Shares are listed and principally traded on the New York Stock Exchange
("NYSE") and the Pacific Stock Exchange ("PCX"). The following table sets forth,
for the quarters indicated, the high and low sales prices per Share on NYSE as
reported by the Dow Jones News Service and the amount of cash dividends paid per
Share according to published financial sources.
SHARE MARKET DATA
<TABLE>
<CAPTION>
HIGH LOW DIVIDENDS
------------- ------------- ---------
<S> <C> <C> <C>
1998:
First Quarter............................................. 43 7/8 38 None
Second Quarter............................................ 44 1/2 30 5/8 None
Third Quarter............................................. 32 23 3/8 None
Fourth Quarter............................................ 30 5/8 22 1/2 None
1999:
First Quarter............................................. 27 7/8 18 7/8 None
Second Quarter............................................ 28 7/16 19 None
Third Quarter............................................. 29 3/16 23 None
Fourth Quarter............................................ 28 15/16 23 3/4 None
2000:
First Quarter............................................. 27 15/16 19 9/16 None
Second Quarter (through June 13, 2000).................... 37 1/2 22 1/2 None
</TABLE>
On June 2, 2000, the last full trading day prior to the announcement of the
execution of the Merger Agreement and of Purchaser's intention to commence the
Offer, the closing price per Share, as reported on NYSE, was $29.00. On
June 13, 2000, the last full trading day prior to the commencement of the Offer,
the closing price per Share, as reported on the NYSE, was $37 1/4. As of
June 12, 2000, the approximate number of holders of record of the Shares was
8,500.
SHAREHOLDERS ARE URGED TO OBTAIN A CURRENT MARKET QUOTATION FOR THE SHARES.
7. CERTAIN INFORMATION CONCERNING THE COMPANY.
Except as otherwise set forth in this Offer to Purchase, all of the
information concerning the Company contained in this Offer to Purchase,
including financial information, has been furnished by the Company or
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<PAGE>
has been taken from or based upon publicly available documents and records on
file with the Commission and other public sources. Neither Purchaser nor Thomson
assumes any responsibility for the accuracy or completeness of the information
concerning the Company furnished by the Company or contained in such documents
and records or for any failure by the Company to disclose events which may have
occurred or may affect the significance or accuracy of any such information but
which are unknown to Purchaser or Thomson.
GENERAL. The Company is a Michigan corporation with its principal executive
offices located at 1000 Winter Street, Suite 4300N, Waltham, Massachusetts, and
its telephone number is (781) 466-6611. The Company was incorporated in Michigan
in 1981 and made its initial public offering of common stock, which trades on
the NYSE and the PCX under the symbol "PMK" in that same year. The Company's
businesses principally consist of the operations of A-T Financial Information,
Baseline Financial Services, Inc., Datastream International Limited and
affiliates, Disclosure Incorporated, I/B/E/S International, Inc., ICV Limited,
Vestek Systems, Inc., WEFA Holdings, Inc. and Worldscope/Disclosure LLC. The
Company also has an equity interest in Primark Decision Economics and minority
interests in certain other companies conducting business activities related to
those of the Company. The Company develops and markets value-added databases
that it combines with proprietary analytical software to create a series of
products used for the analysis and presentation of financial and economic
information. Customers include investment managers and bankers, financial market
traders, analysts, commercial bankers, accounting and legal professionals,
corporate managers, government officials and reference service providers. The
Company's databases are authoritative sources of data and analytics.
CERTAIN PROJECTED FINANCIAL DATA OF THE COMPANY. Prior to entering into the
Merger Agreement, Thomson conducted a due diligence review of the Company and in
connection with such review received certain projections of the Company's future
operating performance (the "Projections"). The Company does not, in the ordinary
course, publicly disclose projections and the Projections were not prepared with
a view to public disclosure. The Company has advised Thomson and Purchaser that
the Projections were prepared by the Company's management based on numerous
assumptions including, among others, projections of revenues, operating income,
benefits and other expenses, depreciation and amortization, capital expenditure
and working capital requirements. No assurances can be given with respect to any
such assumptions. The Projections do not give effect to the Offer or the
potential combined operations of Thomson and the Company or any alterations
Thomson may make to the Company's operations or strategy after the consummation
of the Offer. The information set forth below is presented for the limited
purpose of giving the shareholders access to the material financial projections
prepared by the Company's management that were made available to Thomson and
Purchaser in connection with the Merger Agreement and the Offer.
15
<PAGE>
PRIMARK CORPORATION
PROJECTED FINANCIAL PERFORMANCE(*)
<TABLE>
<CAPTION>
DESCRIPTION FY 2000 FY 2001 FY 2002 FY 2003 FY 2004
----------- -------- -------- -------- -------- ---------
<S> <C> <C> <C> <C> <C>
Total Revenue................................. 546,938 640,369 747,311 870,892 1,024,318
Cost of Sales--Direct......................... 102,775 111,172 129,752 155,891 190,842
EBITDA........................................ 104,134 145,082 175,024 204,710 239,943
Operating Income.............................. 33,445 68,483 94,092 119,157 148,979
Net Income after taxes........................ 16,164 24,818 44,886 62,429 81,903
</TABLE>
------------------------
(*) All amounts in thousands of US$. The Projections were compiled as of
January 1, 2000 and assumed the sale of 45% of the equity interest in Yankee
Group Research, Inc. Subsequently, on June 1, 2000, the entire equity
interest in the Yankee Group was sold. The Projections were not updated.
CERTAIN MATTERS DISCUSSED HEREIN, INCLUDING, BUT NOT LIMITED TO THE
PROJECTIONS, CONTAIN FORWARD-LOOKING STATEMENTS THAT INVOLVE RISKS AND
UNCERTAINTIES. FORWARD-LOOKING STATEMENTS INCLUDE THE INFORMATION SET FORTH
ABOVE UNDER "CERTAIN PROJECTED FINANCIAL DATA OF THE COMPANY". WHILE PRESENTED
WITH NUMERICAL SPECIFICITY, THE PROJECTIONS WERE NOT PREPARED BY THE COMPANY IN
THE ORDINARY COURSE AND ARE BASED UPON A VARIETY OF ESTIMATES AND HYPOTHETICAL
ASSUMPTIONS THAT MAY NOT BE ACCURATE, MAY NOT BE REALIZED, AND ARE ALSO
INHERENTLY SUBJECT TO SIGNIFICANT BUSINESS, ECONOMIC AND COMPETITIVE
UNCERTAINTIES AND CONTINGENCIES, EACH OF WHICH IS DIFFICULT TO PREDICT, AND ARE,
IN MOST INSTANCES, BEYOND THE CONTROL OF THE COMPANY. ACCORDINGLY, THERE CAN BE
NO ASSURANCE THAT ANY OF THE PROJECTIONS WILL BE REALIZED AND THE ACTUAL RESULTS
FOR THE YEARS ENDING DECEMBER 31, 2000 TO 2004 MAY VARY MATERIALLY FROM THOSE
SHOWN ABOVE.
The Projections were not prepared in accordance with generally accepted
accounting principles, and neither the Company's nor Thomson's independent
accountants have examined or compiled any of the Projections or expressed any
conclusion or provided any other form of assurance with respect to these
projections and accordingly assume no responsibility for these projections.
These projections were prepared with a limited degree of precision, and were not
prepared with a view to public disclosure or compliance with the published
guidelines of the Commission or the guidelines established by the American
Institute of Certified Public Accountants regarding projections, which would
require a more complete presentation of data than as shown above. THE INCLUSION
OF THE PROJECTIONS HEREIN SHOULD NOT BE REGARDED AS A REPRESENTATION EITHER BY
THOMSON, PURCHASER OR THE COMPANY OR ANY OTHER PERSON THAT THE PROJECTED RESULTS
WILL BE ACHIEVED. THE PROJECTIONS SHOULD BE READ IN CONJUNCTION WITH THE
HISTORICAL FINANCIAL INFORMATION OF THE COMPANY INCLUDED ABOVE. NONE OF THOMSON,
PURCHASER, THE COMPANY, OR ANY OTHER PERSON ASSUMES ANY RESPONSIBILITY FOR THE
ACCURACY OR VALIDITY OF THE FOREGOING PROJECTIONS. FORWARD-LOOKING STATEMENTS
ALSO INCLUDE THOSE PRECEDED BY, FOLLOWED BY OR THAT INCLUDE THE WORDS
"BELIEVES", "EXPECTS", "ANTICIPATES" OR SIMILAR EXPRESSIONS.
AVAILABLE INFORMATION. The Company is subject to the informational filing
requirements of the Exchange Act and, in accordance therewith, is required to
file periodic reports, proxy statements and other information with the
Commission relating to its business, financial condition and other matters.
Information as of particular dates concerning the Company's directors and
officers, their remuneration, stock options granted to them, the principal
holders of the Company's securities and any material interest of such persons in
transactions with the Company is required to be disclosed in proxy statements
distributed to the Company's shareholders and filed with the Commission. Such
reports, proxy statements and other information should be available for
inspection at the public reference facilities maintained by the Commission at
Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and also should
be available for inspection at the Commission's regional offices located at
Seven World Trade Center, 13(th) Floor, New York, New York 10048 and the
Northwestern Atrium Center, 500 West Madison Street, Suite 1400, Chicago,
Illinois 60661-2511. Copies of such materials may also be obtained by mail, upon
payment of the Commission's customary fees, by writing to its principal office
at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549. The
Commission also maintains a World Wide Website on the Internet at
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http://www.sec.gov that contains reports and other information regarding issuers
that file electronically with the Commission. The phone number of the Commission
is (202) 942-8088.
8. CERTAIN INFORMATION CONCERNING PURCHASER AND THOMSON.
GENERAL. Purchaser is a newly incorporated Michigan corporation organized
in connection with the Offer and the Merger and has not carried on any
activities other than in connection with the Offer and the Merger. The principal
offices of Purchaser are located at Metro Center, One Station Place, Stamford,
Connecticut, and its telephone number is (203) 969-8700. Purchaser is an
indirect wholly owned subsidiary of Thomson.
Until immediately prior to the time that Purchaser will purchase Shares
pursuant to the Offer, it is not anticipated that Purchaser will have any
significant assets or liabilities or engage in activities other than those
incident to its formation and capitalization and the transactions contemplated
by the Offer and the Merger. Because Purchaser is newly formed and has minimal
assets and capitalization, no meaningful financial information regarding
Purchaser is available.
Thomson is a corporation organized under the laws of Ontario, Canada. Its
principal offices are located at Suite 2706, Toronto Dominion Bank Tower,
P.O. Box 24, Toronto Dominion Centre, Toronto, Ontario, M5K 1A1, Canada. Thomson
(www.thomson.com) is a leading, global e-information and solutions company in
the business and professional marketplace. Thomson's Legal & Regulatory group,
led by the West Group, is a leading provider of information and software-based
solutions to law, tax, accounting, human resources, and other corporate
professionals around the world. Thomson Financial provides information services
and software-based solutions to the worldwide financial community. Thomson
Learning is among the world's largest providers of lifelong learning
information, servicing the needs of individuals, learning institutions and
corporations. Thomson's Scientific, Reference & Healthcare group provides
high-value information and services to researchers and other professionals in
the academic, scientific, government and healthcare marketplaces. The
Corporation's common shares are listed on the Toronto and London Stock
Exchanges.
The name, citizenship, business address, business telephone number,
principal occupation or employment, and five-year employment history for each of
the directors and executive officers of Purchaser and Thomson and certain other
information are set forth in Schedule I hereto. Except as described in this
Offer to Purchase and in Schedule I hereto, none of Thomson, Purchaser or, to
the best knowledge of such corporations, any of the persons listed on
Schedule I to the Offer of Purchase has during the last five years (i) been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or (ii) been a party to any judicial or administrative proceeding
(except for matters that were dismissed without sanction or settlement) that
resulted in a judgment, decree or final order enjoining the person from future
violations of, or prohibiting activities subject to, federal or state securities
laws or finding any violation of such laws.
Except as described in this Offer to Purchase, (i) none of Purchaser,
Thomson nor, to the best knowledge of Purchaser and Thomson, any of the persons
listed in Schedule I to this Offer to Purchase or any associate or majority
owned subsidiary of Purchaser, Thomson or any of the persons so listed,
beneficially owns or has any right to acquire any Shares and (ii) none of
Purchaser, Thomson nor, to the best knowledge of Purchaser and Thomson, any of
the persons or entities referred to above nor any director, executive officer or
subsidiary of any of the foregoing has effected any transaction in the Shares
during the past 60 days. Please see Section 10 for a description of the Merger
Agreement and the Shareholders Agreement.
Except as provided in the Merger Agreement and the Shareholders Agreement
and as otherwise described in this Offer to Purchase, none of Purchaser, Thomson
nor, to the best knowledge of Purchaser and Thomson, any of the persons listed
in Schedule I to this Offer to Purchase, has any agreement, arrangement,
understanding, whether or not legally enforceable, with any other person with
respect to any
17
<PAGE>
securities of the Company, including, but not limited to, the transfer or voting
of such securities, joint ventures, loan or option arrangements, puts or calls,
guaranties of loans, guaranties against loss or the giving or withholding of
proxies, consents or authorizations. Except as set forth in this Offer to
Purchase, since January 1, 1998, neither Purchaser nor Thomson nor, to the best
knowledge of Purchaser and Thomson, any of the persons listed on Schedule I
hereto, has had any transaction with the Company or any of its executive
officers, directors or affiliates that is required to be reported under the
rules and regulations of the Commission applicable to the Offer. Except as set
forth in this Offer to Purchase, since January 1, 1998, there have been no
negotiations, transactions or material contacts between any of Purchaser,
Thomson, or any of their respective subsidiaries or, to the best knowledge of
Purchaser and Thomson, any of the persons listed in the Schedule to this Offer
to Purchase, on the one hand, and the Company or its affiliates, on the other
hand, concerning a merger, consolidation or acquisition, tender offer for or
other acquisition of any class of the Company's securities, an election of the
Company's directors or a sale or other transfer of a material amount of assets
of the Company.
9. FINANCING OF THE OFFER AND THE MERGER.
The total amount of funds required by Purchaser to consummate the Offer and
the Merger and to pay related fees and expenses is estimated to be approximately
$1.09 billion. Purchaser will obtain all of such funds from Thomson or its
affiliates. Thomson and its affiliates will provide such funds from existing
resources.
10. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY; THE MERGER
AGREEMENT; THE SHAREHOLDERS AGREEMENT; THE CHANGE OF CONTROL AGREEMENTS; THE
CONFIDENTIALITY AGREEMENT.
In the second half of February 2000, Patrick J. Tierney, President and Chief
Executive Officer of Thomson Financial, a division of Thomson ("Thomson
Financial") called Joseph E. Kasputys, the Company's Chairman, President and
Chief Executive Officer to request a meeting to discuss how Thomson Financial
and the Company might work together. Messrs. Tierney and Kasputys agreed to
schedule a meeting for March 20, 2000.
On March 20, 2000, Messrs. Kasputys and Richard Harrington, Thomson's
President and Chief Executive Officer met to discuss developments in the
financial information industry and the operations of the Company and Thomson.
Mr. Harrington raised the possible acquisition of the Company by Thomson,
indicating that the two companies' respective financial information businesses
were very complementary and that Thomson Financial was extremely interested in
the Company's strong management team and capable staff.
Following discussions with Morgan Stanley & Co. Incorporated and Compass
Partners International, LLC, Thomson's financial advisors, and its legal
counsel, on March 22, 2000, Mr. Harrington sent Mr. Kasputys the following
letter:
[THOMSON LETTERHEAD]
March 22, 2000
Mr. Joseph E. Kasputys
Chairman, President and Chief Executive Officer
Primark Corporation
1000 Winter Street, Suite 4300N
Waltham, MA 02451-1241
Dear Joe:
I enjoyed having lunch with you on Monday. I very much
appreciated your description of the history of Primark Corporation
and its transformation into an information company. You and your
team should be proud of your accomplishments in
18
<PAGE>
that regard. As promised, I am sending this letter to you to
provide certain specifics regarding the matters that we discussed.
The Thomson Corporation proposes to acquire Primark through a
negotiated tender offer/merger transaction in which Primark's
shareholders would receive no less than $31.00 in cash for each
share of outstanding common stock. Our current proposal is based
on a review of public information and our assessment of the
benefits of combining our organizations. Thomson may be prepared
to offer value of up to an additional 10%. Any increase above $31
per share will be a function of our findings during due diligence
and our ability to reach agreement on a transaction in an
accelerated fashion.
We believe that our proposal represents an excellent
opportunity to maximize value for your shareholders. At our
proposed price, which represents a premium of over 50% to current
trading levels, we believe that Primark's stockholders would
enthusiastically support a transaction.
As I know you are aware, The Thomson Corporation, with 1999
revenues of $6.6 billion, is a global e-information and solutions
company in the business and professional marketplace. We hold
leading positions in the legal and regulatory, financial,
scientific, reference, healthcare, learning and corporate
training, information sectors. Thomson has, as does Primark, an
enviable reputation for the quality of its products and services.
Thomson's senior management team has been studying the benefits of
a combination with Primark for some time. We strongly believe the
complementary aspects of our products, product capabilities and
technologies would be a terrific strategic fit. In addition, our
financial ability to enhance such technologies would enable the
combined operation to compete more effectively in the global
marketplace. For these reasons, a combination of Primark with the
Thomson Financial business has become of great interest to our
management and the Thomson Board of Directors.
At Thomson, we believe that people are the core value of our
business, and that we provide a stimulating and satisfying
environment for all levels of our staff. In this regard, we
recognize the importance of Primark's management and employees. We
fully intend to sustain an environment which continues to motivate
and reward its people as we invest in growing the business.
We envision that should you agree to move forward, we would be
in a position to swiftly complete confirmatory due diligence and
negotiate a mutually acceptable definitive merger agreement on
appropriate and customary terms and conditions. Obviously, given
our financial strength and resources, consummation of a
transaction would not be contingent on obtaining financing, and
Morgan Stanley and Compass Partners, our financial advisors,
concur.
We hope that you will view this proposal as we do--a unique
opportunity for Primark's shareholders to realize full value for
their shares in a transaction that can be quickly consummated.
Attached please find a Confidentiality Agreement that we would
propose to have executed prior to commencement of a due diligence
review, and a schedule of the limited due diligence we would need
to perform prior to entering into a definitive agreement. We are
prepared to meet with you and your advisors to answer any
questions that you may have about our proposal and to proceed
expeditiously to negotiate a merger agreement with you. We are
prepared to provide to you, and meet to review as soon as
appropriate, our proposed form of definitive agreements.
My purpose in sending this letter is to provide you with more
information about our proposal and to express our sincere desire
to work together with you to reach
19
<PAGE>
agreement on a consensual basis. We would expect that you will not
publicly disclose this proposal, other than to discuss it with
your Board of Directors and advisors. Consequently, this proposal
will be null and void upon any public disclosure of this proposal.
We seek to move quickly on our proposal and would like to hear
back from you as soon as possible. Accordingly, unless we hear
back from you before then, we will contact you on Monday, March
27, to discuss your Board's response to our proposal.
Regards,
/s/ Richard J. Harrington
Richard J. Harrington
RJH/kmr
On March 31, 2000, Mr. Kasputys sent Mr. Harrington the following letter:
[PRIMARK LETTERHEAD]
March 31, 2000
Mr. Richard J. Harrington
President and Chief Executive Officer
The Thomson Corporation
Metro Center @ One Station Place
Stamford, CT 06902
Dear Richard:
This will respond to your letter to me of March 22, 2000. I
have shared your letter with my fellow directors and we have
concluded that it is not in the best interests of Primark or its
shareholders to pursue the matters set forth therein.
Sincerely,
/s/ Joseph E. Kasputys
Joseph E. Kasputys
cc: Primark Board of Directors
On April 3, 2000, Thomson's management team requested additional information
from the Company in order to analyse whether a higher offer would be justified.
As a result of Thomson's request for additional information, the Company and
Thomson entered into a confidentiality agreement, dated as of April 4, 2000. A
few days later, Mr. Kasputys and Mr. Tierney met at the Company's executive
offices in Waltham, Massachusetts to discuss the Company's business.
On April 8, 2000, Mr. Kasputys, Stephen H. Curran, the Company's Chief
Financial Officer, Michael R. Kargula, the Company's General Counsel, and
certain members of the Company's financial staff met with Mr. Tierney, James
Schroeder, Thomson's Vice President for Tax, Sharon Rowlands, Chief Operating
Officer of Thomson Financial, and Raymond Fagan, Chief Financial Officer of
Thomson Financial at the Company's executive offices in Waltham, Massachusetts
to discuss the Company's business.
Following this meeting, Mr. Tierney called Mr. Kasputys to request certain
additional information to assist Thomson in its valuation of the Company.
20
<PAGE>
On May 8, 2000, Mr. Harrington called Mr. Kasputys to inform him that
Thomson would be making a revised proposal shortly after Thomson's scheduled
board meeting on May 18, 2000. Mr. Harrington again stated this intention to Mr.
Kasputys on May 11, 2000.
On May 18, 2000, Mr. Tierney made a presentation to the Board of Directors
of Thomson concerning a possible acquisition of the Company. The Thomson Board
authorized the executive officers of Thomson and Thomson Financial to pursue an
acquisition of the Company.
On May 22, 2000, Mr. Harrington sent the following letter to Mr. Kasputys:
[THOMSON LETTERHEAD]
May 22, 2000
Mr. Joseph E. Kasputys
Chairman, President and Chief Executive Officer
Primark Corporation
1000 Winter Street, Suite 4300N
Waltham, MA 02451-1241
Dear Joe:
As indicated in our previous discussions, a combination of
Primark (the "Company") with the Thomson Financial business
continues to be of great interest to The Thomson Corporation
("Thomson"). My Board and I wish to reemphasize the seriousness of
our proposal and our desire to move these discussions forward.
As you will recall, during our initial lunch meeting on March
20, 2000, I presented an offer of not less than $31 in cash for
each outstanding common share of Primark. This offer was based on
public information and our assessment of the benefits of combining
our organizations. After further consideration and reflection on
our discussions, we shared with you a written proposal dated March
22, 2000 which indicated Thomson's willingness to offer value of
up to an additional 10% depending on our findings during due
diligence.
Since that time, we have incorporated the additional
information that you have provided to us and further enhanced our
understanding of Primark's transformation. In an effort to advance
our discussions and consummate a transaction with Primark, we are
prepared to revise our proposal.
After reviewing the additional information and further
studying the strategic benefits of a combination, Thomson proposed
to acquire Primark through a negotiated tender offer/merger
transaction in which Primark's shareholders would receive $36.50
per share in cash for each outstanding share of common stock. We
believe that our proposal represents an excellent opportunity to
maximize value for your shareholders and represents a full and
fair price. The offer represents a premium of over 80% to the
"unaffected" trading level when we first met to discuss a possible
business combination on March 20, 2000. The offer represents a
premium of almost 50% to current trading levels and a premium of
over 25% to the last twelve months high price. We are confident
that Primark's Board of Directors and shareholders will
enthusiastically support a transaction at this level.
To consummate a transaction, we believe we could complete due
diligence in five business days. (We have attached our original
schedule of the limited due diligence which we would require.) We
are prepared to negotiate concurrently a mutually acceptable
definitive merger agreement on customary terms and conditions.
Given our
21
<PAGE>
financial strength and resources, consummation of a transaction
would not be contingent on obtaining financing, and Morgan Stanley
and Compass Partners, our financial advisors, concur. This
transaction has been fully considered by my senior management team
and has the support of my Board of Directors.
I would like to reiterate that at Thomson, we believe that
people are the core value of our business, and that we provide a
satisfying working environment for all levels of our staff. In
this regard, we recognize the importance of Primark's management
and employees and would seek to ensure that key people are
retained. In this regard, it should be one of our first priorities
to identify key managers and employees that we want to retain, and
address specific plans to do so. We fully intend to sustain an
environment within Primark that continues to motivate and reward
its people as we invest in growing the business.
Joe, as we discussed, we would be pleased for you to assume
the position of Non-executive Chairman of Thomson Financial
working with Pat and his management team to drive the consolidated
business forward.
I hope the seriousness with which I am treating this matter is
conveyed by this letter, our recent conversations, and the
increased offer of $36.50 per share in cash. As a result, we seek
to move quickly on our proposal, and we expect that you will share
this letter with your Board of Directors and that it will be given
the attention it deserves.
We believe that you will view this proposal as we do--a unique
opportunity for Primark's shareholders to realize full value for
their shares in a transaction that can be quickly consummated. As
noted in my previous letter, we would expect that you will not
disclose this proposal, other than to discuss it with your Board
of Directors and advisors. Consequently, this proposal will be
null and void upon any public disclosure of this letter or offer.
We look forward to hearing back from you by Tuesday, May 30, 2000.
Regards,
/s/ Richard J. Harrington
Richard J. Harrington
RJH/kmr
Attachment
Later on May 22, Mr. Kasputys called Mr. Harrington to indicate that the
Company would consider a proposal if Thomson was willing to increase its offer
to $38.00 per Share. Mr. Harrington informed Mr. Kasputys that Thomson would
consider acquiring the Company at $38.00 per Share in cash, if Thomson was
satisfied with the results of its due diligence review and the parties were able
to negotiate a mutually acceptable definitive merger agreement.
On May 24, 2000, Messrs. Kasputys and Kargula met with Messrs. Harrington,
Tierney, Robert D. Daleo, Thomson's Chief Financial Officer, and Michael S.
Harris, Thomson's General Counsel, at Thomson's executive offices in Stamford,
Connecticut. At this meeting, the parties discussed issues relating to personnel
and the timing of Thomson's due diligence review of the Company.
Also on May 24, 2000, outside legal counsel for Thomson delivered a draft of
the Merger Agreement to the Company's outside legal counsel. From May 24, 2000
through June 4, 2000, the parties, together with their respective outside legal
counsel, conducted negotiations with respect to the Merger Agreement, the
Shareholders Agreement, the employment agreements for certain key employees of
the Company, and
22
<PAGE>
agreements relating to certain change of control agreements between the Company
and certain of its executive officers.
In addition, on May 24, 2000, representatives of Thomson commenced due
diligence at the Company's offices in Waltham, Massachusetts. Subsequently,
employees of Thomson Financial and representatives of its outside legal counsel
and independent auditors joined the due diligence review, which continued
through June 4, 2000.
On June 5, 2000, Thomson, Purchaser and the Company executed and delivered
the Merger Agreement and issued a press release announcing the execution of the
Merger Agreement and the transactions contemplated thereby. On June 14, 2000,
the Purchaser commenced the Offer.
THE MERGER AGREEMENT
THE FOLLOWING IS A SUMMARY OF CERTAIN PROVISIONS OF THE MERGER AGREEMENT.
THIS SUMMARY IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO THE MERGER AGREEMENT,
WHICH IS INCORPORATED HEREIN BY REFERENCE, AND HAS BEEN FILED AS AN EXHIBIT TO
THE TENDER OFFER STATEMENT ON SCHEDULE TO (THE "SCHEDULE TO") FILED WITH THE
COMMISSION BY PURCHASER AND THOMSON IN CONNECTION WITH THE OFFER. THE MERGER
AGREEMENT MAY BE EXAMINED AND COPIES MAY BE OBTAINED AT THE PLACES SET FORTH IN
SECTION 7 OR DOWNLOADED FOR FREE AT WWW.SEC.GOV. DEFINED TERMS USED HEREIN AND
NOT DEFINED HEREIN SHALL HAVE THE RESPECTIVE MEANINGS ASSIGNED TO THOSE TERMS IN
THE MERGER AGREEMENT.
THE OFFER. The Merger Agreement provides for the commencement of the Offer
as promptly as reasonably practicable and, in any event within ten business
days, after the initial public announcement of Purchaser's intention to commence
the Offer. The obligation of Purchaser to accept for payment Shares tendered
pursuant to the Offer is subject to the satisfaction of the Minimum Condition
and certain other conditions that are described in Section 14 hereof. Purchaser
and Thomson have agreed that no change in the Offer may be made that decreases
the price per Share payable in the Offer, changes the form of the consideration
payable in the Offer, reduces the maximum number of Shares to be purchased in
the Offer, imposes conditions to the Offer in addition to those set forth in
Section 14, or modifies or amends any condition to the Offer in any manner that
is materially adverse to the holders of Shares, or, except as provided in the
Merger Agreement or required by any rule, regulation, interpretation or position
of the Commission, extends the expiration date of the Offer.
THE MERGER. The Merger Agreement provides that, upon the terms and subject
to the conditions thereof, and in accordance with Michigan law, Purchaser shall
be merged with and into the Company. As a result of the Merger, the separate
corporate existence of Purchaser will cease and the Company will continue as the
Surviving Corporation and will become a wholly owned subsidiary of Thomson. Upon
consummation of the Merger, each issued and then outstanding Share (other than
any Shares held in the treasury of the Company, or owned by Purchaser, Thomson
or any direct or indirect wholly owned subsidiary of Thomson or of the Company
and any Shares that are held by shareholders who have not voted in favor of the
Merger or consented thereto in writing and who shall have demanded properly in
writing appraisal for such Shares in accordance with Michigan Law) shall be
canceled and converted automatically into the right to receive the Merger
Consideration.
Pursuant to the Merger Agreement, each Share issued and outstanding
immediately prior to the Effective Time shall be converted into and exchanged
for one validly issued, fully paid and non-assessable share of common stock, no
par value per share, of the Surviving Corporation.
The Merger Agreement provides that the directors of Purchaser immediately
prior to the Effective Time will be the initial directors of the Surviving
Corporation and that the officers of the Company immediately prior to the
Effective Time will be the initial officers of the Surviving Corporation.
Subject to the Merger Agreement at the Effective Time, the Articles of
Incorporation of Purchaser, as in effect immediately prior to the Effective
Time, will be the Articles of Incorporation of the Surviving Corporation;
provided, however, that, at the Effective Time, Article I of the Articles of
Incorporation of the Surviving
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<PAGE>
Corporation shall be amended to read as follows: "The name of the corporation is
Primark Corporation". Subject to the Merger Agreement, at the Effective Time,
the By-laws of Purchaser, as in effect immediately prior to the Effective Time,
will be the By-laws of the Surviving Corporation.
SHAREHOLDERS' MEETING. Pursuant to the Merger Agreement, the Company,
acting through its Board, shall, if required by applicable law in order to
consummate the Merger, duly call, give notice of, convene and hold an annual or
special meeting of its shareholders as promptly as practicable following
consummation of the Offer for the purpose of considering and taking action on
the Merger Agreement and the Merger (the "Shareholders' Meeting"). If Purchaser
acquires at least a majority of the outstanding Shares, Purchaser shall have
sufficient voting power to approve the Merger, even if no other shareholder
votes in favor of the Merger.
PROXY STATEMENT. The Merger Agreement provides that the Company shall, if
approval of the Company's shareholders is required by applicable law to
consummate the Merger, promptly following consummation of the Offer, file with
the Commission under the Exchange Act, and use its reasonable best efforts to
have cleared by the Commission, a proxy statement and related proxy materials
(the "Proxy Statement") with respect to the Shareholders' Meeting and shall
cause the Proxy Statement and all required amendments and supplements thereto to
be mailed to the holders of Shares at the earliest practicable time. The Company
has agreed to include in the Proxy Statement, and, subject to the terms of the
Merger Agreement, not subsequently withdraw or modify in any manner adverse to
Purchaser or Thomson, the unanimous recommendation of the Board that the
shareholders of the Company approve and adopt the Merger Agreement and the
Merger and take all actions reasonably necessary to obtain such approval and
adoption. Thomson and Purchaser have agreed to cause all Shares then owned by
them and their subsidiaries to be voted in favor of approval and adoption of the
Merger Agreement and the Merger. The Merger Agreement provides that, in the
event that Purchaser shall acquire at least 90% of the then outstanding Shares,
Thomson, Purchaser and the Company will take all necessary and appropriate
action to cause the Merger to become effective, in accordance with Michigan Law,
as promptly as reasonably practicable after such acquisition, without a meeting
of the Company's shareholders.
CONDUCT OF BUSINESS BY THE COMPANY PENDING THE MERGER. Pursuant to the
Merger Agreement, the Company has covenanted and agreed that, between the date
of the Merger Agreement and the Effective Time, unless Thomson shall otherwise
agree in writing, the businesses of the Company and its subsidiaries (the
"Subsidiaries" and, individually, a "Subsidiary") will be conducted only in, and
the Company and the Subsidiaries shall not take any action except in, the
ordinary course of business and in a manner consistent with past practice; and
the Company shall use its reasonable best efforts to preserve substantially
intact the business organization of the Company and the Subsidiaries, to keep
available the services of the current officers, employees and consultants of the
Company and the Subsidiaries and to preserve the current relationships of the
Company and the Subsidiaries with customers, suppliers and other persons with
which the Company or any Subsidiary has significant business relations. The
Merger Agreement provides that except as contemplated therein, neither the
Company nor any Subsidiary shall, between the date of the Merger Agreement and
the Effective Time, directly or indirectly, do, or propose to do, any of the
following, without the prior written consent of Thomson, which consent will not
be unreasonably withheld: (a) amend or otherwise change its Articles of
Incorporation or By-laws or equivalent organizational documents; (b) issue,
sell, pledge, dispose of, grant, encumber, or authorize the issuance, sale,
pledge, disposition, grant or encumbrance of, (i) any shares of any class of
capital stock of the Company or any Subsidiary, or any options, warrants,
convertible securities or other rights of any kind to acquire any shares of such
capital stock, or any other ownership interest (including, without limitation,
any phantom interest), of the Company or any Subsidiary (except for the issuance
of a maximum of 4,933,628 Shares issuable pursuant to options outstanding on the
date of the Merger Agreement) or (ii) any material assets of the Company or any
Subsidiary, except in the ordinary course of business and in a manner consistent
with past practice; (c) declare, set aside, make or pay any dividend or other
distribution, payable in cash, stock, property or otherwise, with respect to any
of its capital stock, except that a direct or indirect wholly owned
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subsidiary may declare and pay a dividend or make advance to its parent or the
Company; (d) reclassify, combine, split, subdivide or redeem or purchase or
otherwise acquire, directly or indirectly, any of its capital stock; (e) (i)
acquire (including, without limitation, by merger, consolidation, or acquisition
of stock or assets or any other business combination) any corporation,
partnership, other business organization or any division thereof or any material
amount of assets, other than pending acquisition or minority investments, in
each case publicly announced prior to the date of the Merger Agreement,
(ii) incur any indebtedness for borrowed money or issue any debt securities or
assume, guarantee or endorse, or otherwise become responsible for, the
obligations of any person, or make any loans or advances, except in the ordinary
course of business and consistent with past practice, (iii) authorize, or make
any commitment with respect to (A) any capital expenditures in excess of
$4,000,000 in the aggregate per month, (B) any single capital expenditure which
is in excess of $500,000 or (C) any single capital project that as reasonably
likely to cost $2,000,000 or more in the aggregate for the Company and the
Subsidiaries taken as a whole, make or direct to be made any capital investments
or equity investments in any entity, other than investments in any wholly owned
Subsidiary in excess of $500,000 for a single transaction and $1,000,000 in the
aggregate, or (iv) enter into or amend any contract, agreement, commitment or
arrangement with respect to any of the foregoing matters; (f) increase the
compensation payable or to become payable or the benefits provided to its
directors, officers or employees, except for increases in the ordinary course of
business and consistent with past practice in salaries or wages of employees of
the Company or any Subsidiary who are not directors or officers of the Company,
or grant any severance or termination pay to, or enter into any employment or
severance agreement with any director, officer or other employee of the Company
or of any Subsidiary, or establish, adopt, enter into or amend any collective
bargaining, bonus, profit-sharing, thrift, compensation, stock option,
restricted stock, pension, retirement, deferred compensation, employment,
termination, severance or other plan, agreement, trust, fund, policy or
arrangement for the benefit of any director, officer or employee; (g) take any
action, other than reasonable and usual actions in the ordinary course of
business and consistent with past practice, with respect to accounting policies
or procedures; (h) make any material tax election or settle or compromise any
material United States federal, state, local or non-United States income tax
liability, except in the ordinary course of business or a manner consistent with
past practice; (i) pay, discharge or satisfy any claim, liability or obligation
(absolute, accrued, asserted or unasserted, contingent or otherwise), other than
the payment, discharge or satisfaction, in the ordinary course of business and
consistent with past practice, of liabilities reflected or reserved against in
the 1999 Balance Sheet or subsequently incurred in the ordinary course of
business and consistent with past practice; (j) amend, modify or consent to the
termination of any Company Material Contract, or amend, waive, modify or consent
to the termination of the Company's or any Subsidiary's rights thereunder, other
than in the ordinary course of business and consistent with past practice;
(k) commence or settle any material litigation, suit, claim, action, proceeding
or investigation; or (l) announce an intention, enter into any formal or
informal agreement or otherwise make a commitment, to do any of the foregoing.
COMPANY BOARD REPRESENTATION. The Merger Agreement provides that, promptly
upon the purchase by Purchaser of Shares pursuant to the Offer and from time to
time thereafter, Purchaser shall be entitled to designate up to such number of
directors, rounded up to the next whole number, on the Board as shall give
Purchaser representation on the Board equal to the product of the total number
of directors on the Board (giving effect to the directors elected pursuant to
this sentence), multiplied by the percentage that the aggregate number of Shares
beneficially owned by Purchaser or any affiliate of Purchaser following such
purchase bears to the total number of Shares then outstanding, and the Company
shall, at such time, promptly take all actions within its power reasonably
necessary to cause Purchaser's designees to be elected as directors of the
Company, including increasing the size of the Board or securing the resignations
of incumbent directors, or both. The Merger Agreement also provides that, at
such times, the Company shall use its reasonable best efforts to cause persons
designated by Purchaser to constitute the same percentage as persons designated
by Purchaser shall constitute of the Board of (i) each committee of the Board,
(ii) each board of directors of each Subsidiary, and (iii) each committee of
each such board, in each case only to the extent permitted by applicable law.
Notwithstanding the foregoing, until the Effective
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Time, the Company has agreed to use its reasonable best efforts to ensure that
at least two members of the Board (in addition to the Company's Chief Executive
Officer) and each committee of the Board and such boards and committees of the
Subsidiaries, as of the date of the Merger Agreement, who are not employees of
the Company shall remain members of the Board and of such boards and committees.
The Merger Agreement provides that, following the election or appointment of
Purchaser's designees in accordance with the immediately preceding paragraph and
prior to the Effective Time, any amendment of the Merger Agreement or the
Articles of Incorporation or By-laws of the Company, any termination of the
Merger Agreement by the Company, any extension by the Company of the time for
the performance of any of the obligations or other acts of Thomson or Purchaser,
or waiver of any of the Company's rights thereunder, shall require the
concurrence of a majority of those directors of the Company then in office who
were directors of the Company on June 5, 2000 or designees of such directors.
ACCESS TO INFORMATION. Pursuant to the Merger Agreement, until the
Effective Time, to the extent permitted by applicable law, the Company shall,
and shall cause the Subsidiaries and the officers, directors, employees,
auditors and agents of the Company and the Subsidiaries to, afford the officers,
employees and agents of Thomson and Purchaser complete access at all reasonable
times to the officers, employees, agents, properties, offices, plants and other
facilities, books and records of the Company and each Subsidiary, and shall
furnish Thomson and Purchaser with such financial, operating and other data and
information as Thomson or Purchaser, through its officers, employees or agents,
may reasonably request, Thomson and Purchaser have agreed to keep such
information confidential, except in certain circumstances.
NO SOLICITATION OF TRANSACTIONS. The Company has agreed that neither it nor
any Subsidiary shall, directly or indirectly, through any officer, director,
agent or otherwise, (i) solicit, initiate or encourage the submission of, any
Acquisition Proposal (as defined in the Merger Agreement) including a Superior
Proposal (as defined below) or (ii) participate in any discussions or
negotiations regarding, or furnish to any person, any information with respect
to, or otherwise cooperate in any way with respect to, or assist or participate
in, or facilitate, any Acquisition Proposal, except that the Company may take
any actions listed in (ii) if (A) the Board determines in good faith after
having received advice from outside legal counsel that such action is required
by the fiduciary duties of the Board under applicable law, (B) the Board
determines in good faith that the Acquisition Proposal constitutes, or may be
reasonably expected to lead to, a Superior Proposal, and (C) after giving prior
written notice to Thomson and Purchaser and entering into a customary
confidentiality agreement on terms no less favorable to the Company than those
contained in the Confidentiality Agreement.
A "Superior Proposal" means any bona fide written proposal, not solicited,
initiated or encouraged in violation of the foregoing made by a third person to
acquire, directly or indirectly, for consideration consisting of cash and/or
securities, all the equity securities of the Company entitled to vote generally
in the election of directors or all or substantially all of the assets of the
Company, if and only if, the Board reasonably determines (after consultation
with its financial advisor and outside counsel) (i) that the proposed
transaction would be more favorable from a financial point of view to its
shareholders than the Offer and the Merger and the Transactions taking into
account at the time of determination any changes to the terms of the Merger
Agreement that as of that time had been proposed by Thomson, and (ii) that the
person or entity making such Superior Proposal is capable of consummating such
Acquisition Proposal (based upon, among other things, the availability of
financing and the degree of certainty of obtaining financing, the expectation of
obtaining required regulatory approvals and the identity and background of such
person).
The Company has also agreed that neither the Board nor any committee thereof
shall withdraw or modify, or propose to withdraw or modify in a manner adverse
to Thomson or Purchaser, the approval or recommendation by the Board or any such
committee of the Merger Agreement, the Offer, the Merger or any other
Transaction. Notwithstanding the foregoing, in the event that, prior to the time
of acceptance for payment of Shares pursuant to the Offer, in connection with an
Acquisition Proposal, the Board
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determines in good faith (x) after having received advice from outside legal
counsel that such action is required by the fiduciary duties of the Board under
applicable law and (y) that the Acquisition Proposal constitutes a Superior
Proposal, the Board may withdraw or modify its approval or recommendation of the
Offer and the Merger.
The Company has agreed to, and will direct or cause its directors, officers,
employees, representatives and agents to, immediately cease and cause to be
terminated any discussions or negotiations with any parties that may be ongoing
with respect to any Acquisition Proposal. The Company has also agreed to
promptly advise Thomson orally and in writing, of (i) any Acquisition Proposal
or any request for information with respect to any Acquisition Proposal, the
material terms and conditions of such Acquisition Proposal or request and the
identity of the person making such Acquisition Proposal or request and (ii) any
changes in any such Acquisition Proposal or request.
Nothing contained in the section of the Merger Agreement relating to the
non-solicitation of transactions by the Company shall prohibit the Company from
taking and disclosing to its shareholders a position contemplated by
Rules 14d-9 and 14e-2(a) promulgated under the Exchange Act or from making any
disclosure to the Company's shareholders, if the Board determines in good faith,
after having received advice from outside legal counsel, that such action is
required under applicable law; provided, however, that neither the Company nor
the Board nor any committee thereof shall, except as permitted by the section in
the Merger Agreement relating to the non-solicitation of transactions by the
Company, withdraw or modify, or propose publicly to withdraw or modify, its
position with respect to this Agreement, the Offer, the Merger or any other
Transaction or shall approve or recommend, or propose publicly to approve or
recommend, any Acquisition Proposal, including a Superior Proposal.
Except as required by the Board's fiduciary duties under applicable law
after having received advice from outside legal counsel, the Company has agreed
not to release any third party from, or waive any provision of, any
confidentiality or standstill agreement to which the Company is a party.
EMPLOYEE STOCK OPTIONS. The Merger Agreement also provides that, effective
as of the Effective Time, the Company shall take all necessary action, including
obtaining the consent of the individual option holders, if necessary, to
(i) terminate the Company's stock option plans and (ii) cancel, at the Effective
Time, each outstanding option to purchase shares of Company Common Stock granted
under the company stock option plans (each, a "Company Stock Option") that is
outstanding and unexercised as of such date. Each holder of a Company Stock
Option that is outstanding and unexercised at the Effective Time, whether or not
then exercisable or vested, will be entitled to receive from the Surviving
Corporation immediately after the Effective Time, in exchange for the
cancellation of such Company Stock Option, an amount in cash equal to the
excess, if any, of (x) the Per Share Amount over (y) the per share exercise
price of such Company Stock Option, multiplied by the number of shares of
Company Common Stock subject to such Company Stock Option as of the Effective
Time.
DIRECTORS' AND OFFICERS' INDEMNIFICATION INSURANCE. The Merger Agreement
further provides that the By-laws of the Surviving Corporation will contain
provisions no less favorable with respect to indemnification than are set forth
in Article VII of the By-laws of the Company, which provisions shall not be
amended, repealed or otherwise modified for a period of six years from the
Effective Time in any manner that would affect adversely the rights thereunder
of individuals who, at or prior to the Effective Time, were directors, officers,
employees, fiduciaries or agents of the Company, unless such modification shall
be required by law.
Thomson shall cause the Surviving Corporation, to the fullest extent
permitted under applicable law, to indemnify and hold harmless, each present and
former director, officer or employee of the Company or any of its Subsidiaries
(collectively, the "Indemnified Parties") against any costs or expenses
(including attorneys' fees), judgments, fines, losses, claims, damages,
liabilities and amounts paid in settlement in connection with any claim, action,
suit, proceeding or investigation, whether civil, criminal, administrative or
investigative, (i) arising out of or pertaining to the Transactions or
(ii) otherwise with respect to any acts
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or omissions occurring at or prior to the Effective Time, to the same extent as
provided in the Company's Articles of Incorporation or By-laws or any applicable
contract or agreement as in effect on the date hereof, in each case for a period
of six years after June 5, 2000. In the event of any such claim, action, suit,
proceeding or investigation (whether arising before or after the Effective Time)
and subject to the specific terms of any indemnification contract, (i) any
counsel retained by the Indemnified Parties for any period after the Effective
Time shall be reasonably satisfactory to the Surviving Corporation, (ii) after
the Effective Time, the Surviving Corporation shall pay the reasonable fees and
expenses of such counsel, promptly after statements therefor are received and
(iii) the Surviving Corporation will cooperate in the defense of any such
matter; provided, however, that the Surviving Corporation shall not be liable
for any settlement effected without its written consent (which consent shall not
be unreasonably withheld or delayed); and provided further, that, in the event
that any claim or claims for indemnification are asserted or made within such
six-year period, all rights to indemnification in respect of any such claim or
claims shall continue until the disposition of any and all such claims. The
Indemnified Parties as a group may retain only one law firm (plus local counsel,
if applicable) to represent them with respect to any single action unless there
is, under applicable standards of professional conduct, a conflict on any
significant issue between the positions of any two or more Indemnified Parties,
in which case each Indemnified Person with respect to whom such a conflict
exists (or group of such Indemnified Persons who among them have no such
conflict) may retain one separate law firm.
The Merger Agreement also provides that the Surviving Corporation shall
maintain in effect for six years from the Effective Time, if available, the
current directors' and officers' liability insurance policies maintained by the
Company (provided that the Surviving Corporation may substitute therefor
policies of at least the same coverage containing terms and conditions that are
not materially less favorable) with respect to matters occurring prior to the
Effective Time; provided, however, that in no event shall the Surviving
Corporation be required to expend more than an amount per year equal to 200% of
current annual premiums paid by the Company for such insurance (which premiums
the Company has represented to Thomson and Purchaser to be $215,000 per annum in
the aggregate).
Thomson, Purchaser and the Company have also agreed that in the event the
Company or the Surviving Corporation or any of their respective successors or
assigns (i) consolidates with or merges into any other person and shall not be
the continuing or surviving corporation or entity of such consolidation or
merger or (ii) transfers all or substantially all of its properties and assets
to any person, then and in each such case, proper provision shall be made so
that the successors and assigns of the Company or the Surviving Corporation, as
the case may be, or at Thomson's option, Thomson, shall assume the foregoing
indemnification obligations.
FURTHER ACTION; REASONABLE BEST EFFORTS. The Merger Agreement provides
that, subject to its terms and conditions, each of the parties thereto shall
(i) make promptly its respective filings, and thereafter make any other required
submissions, under the Antitrust Acts and (ii) use its reasonable best efforts
to take, or cause to be taken, all appropriate action, and to do, or cause to be
done, all things necessary, proper or advisable under applicable laws and
regulations to consummate and make effective the Transactions including, without
limitation, using its reasonable best efforts to obtain all Permits, consents,
approvals, authorizations, qualifications and orders of Governmental Authorities
and parties to contracts with the Company and the Subsidiaries as are necessary
for the consummation of the Transactions and to inform or consult with any trade
unions, works councils, employee representatives or any other representative
body as required, and to fulfill the conditions to the Offer and the Merger;
provided that neither the Company, Purchaser nor Thomson will be required to
take any action, including entering into a consent decree, hold separate orders
or other arrangements, that (A) requires the divestiture of any assets of any of
the Purchaser, Thomson, Company or any of their respective subsidiaries or
(B) limits Thomson's freedom of action with respect to, or its ability to
retain, the Company and the Subsidiaries or any portion thereof or any of
Thomson's or its affiliates' other assets or businesses. In case, at any time
after the Effective Time, any further action is necessary or desirable to carry
out the purposes of the Merger Agreement, the
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proper officers and directors of each party to the Merger Agreement are required
to use their reasonable best efforts to take all such action.
REPRESENTATIONS AND WARRANTIES. The Merger Agreement contains various
customary representations and warranties of the parties thereto including
representations by the Company as to the absence of certain changes or events
concerning the Company's business, compliance with law, absence of litigation,
employee benefit plans, labor matters, property and leases, intellectual
property, environmental matters, taxes, amendment to the Rights Agreement,
material contracts, insurance and brokers.
CONDITIONS TO THE MERGER. Under the Merger Agreement, the respective
obligations of each party to effect the Merger are subject to the satisfaction,
at or prior to the Effective Time, of the following conditions: (a) if and to
the extent required by Michigan law, the Merger Agreement and the Merger shall
have been approved and adopted by the affirmative vote of the shareholders of
the Company; (b) any waiting period (and any extension thereof) applicable to
the consummation of the Merger under the Antitrust Acts shall have expired or
been terminated; (c) the UK Office of Fair Trading shall have indicated in terms
satisfactory to Thomson and Purchaser in their reasonable discretion that it is
not the intention of the Secretary for Trade and Industry to refer the
Transactions, or any matter arising therefrom, to the Competition Commission;
(d) no Governmental Authority shall have enacted, issued, promulgated, enforced
or entered any Law (whether temporary, preliminary or permanent) which is then
in effect and has the effect of making the acquisition of Shares by Thomson or
Purchaser or any affiliate of either of them illegal or otherwise restricting,
preventing or prohibiting consummation of the Transactions; and (e) Purchaser or
its permitted assignee shall have purchased all Shares validly tendered and not
withdrawn pursuant to the Offer.
TERMINATION. The Merger Agreement provides that it may be terminated and
the Merger may be abandoned at any time prior to the Effective Time,
notwithstanding any requisite approval and adoption of the Merger Agreement and
the Merger by the shareholders of the Company, (a) by mutual written consent of
each of Thomson, Purchaser and the Company duly authorized by the Boards of
Directors of Thomson, Purchaser and the Company; or (b) by either Thomson,
Purchaser or the Company if (i) the Effective Time shall not have occurred on or
before December 31, 2000; provided, however, that the right to terminate the
Merger Agreement under (b)(i) will not be available to any party whose failure
to fulfill any obligation under the Merger Agreement has been the cause of, or
resulted in, the failure of the Effective Time to occur on or before such date,
or (ii) any Governmental Authority shall have enacted, issued, promulgated,
enforced or entered any injunction, order, decree or ruling (whether temporary,
preliminary or permanent) which has become final and nonappealable and has the
effect of making consummation of the Offer or the Merger illegal or otherwise
preventing or prohibiting consummation of the Offer or the Merger; or (c) by
Thomson if (i) due to an occurrence or circumstance that would result in a
failure to satisfy any condition set forth in Section 14 hereto, Purchaser shall
have (A) failed to commence the Offer within 10 business days following the date
of the Merger Agreement or (B) terminated the Offer or the Offer shall have
expired without having accepted any Shares for payment thereunder, unless such
action or inaction under (A) or (B) shall have been caused by or resulted from
the failure of Thomson or Purchaser to perform, in any material respect, any of
their material covenants or agreements contained in the Merger Agreement, or the
material breach by Thomson or Purchaser of any of their material representations
or warranties contained in the Merger Agreement or (ii) prior to the purchase of
Shares pursuant to the Offer, the Board or any committee thereof shall have
withdrawn or modified in a manner adverse to Purchaser or Thomson its approval
or recommendation of the Merger Agreement, the Offer, the Merger or any other
transaction contemplated thereby, or shall have recommended or approved any
Acquisition Proposal, or shall have resolved to do any of the foregoing; or
(d) by the Company if Purchaser shall have (A) failed to commence the Offer
within 10 business days following the date of the Merger Agreement or
(B) terminated the Offer or the Offer shall have expired without Purchaser
having accepted any Shares for payment thereunder, unless such action or
inaction under (A) or (B) shall have been caused by or resulted from the failure
of the Company to perform, in any material respect, any of its material
covenants or
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agreements contained in the Merger Agreement or the material breach by the
Company of any of its material representations or warranties contained in the
Merger Agreement.
EFFECT OF TERMINATION. In the event of the termination of the Merger
Agreement, the Merger Agreement shall become void, and there shall be no
liability on the part of any party thereto, except (i) as set forth below under
the section entitled "Fees" and (ii) nothing in the Merger Agreement shall
relieve any party from liability for any fraudulent or willful breach thereof
prior to the date of such termination. The Confidentiality Agreement shall
survive any termination of the Merger Agreement.
FEES. The Merger Agreement provides that in the event that (i) any person
(including, without limitation, the Company or any affiliate thereof), other
than Thomson or any affiliate of Thomson, shall have become the beneficial owner
of more than 15% of the then-outstanding Shares, and the Merger Agreement shall
have been terminated pursuant to the provisions described above in
clause (b)(i), (c) or (d) of the Section titled "Termination"; or (ii) any
person shall have commenced, publicly proposed or communicated to the Company an
Acquisition Proposal that is publicly disclosed and (A) the Offer shall have
remained open for at least 20 business days, (B) the Minimum Condition shall not
have been satisfied, and (C) the Merger Agreement shall have been terminated
pursuant to the termination provision described above; or (iii) the Merger
Agreement is terminated pursuant to (x) the provisions described above in
(c)(ii) of the Section titled "Termination" or (y) to the provisions described
above in (c)(i) or (d) of the Section titled "Termination," to the extent that
the failure to commence, the termination or the failure to accept any Shares for
payment, as set forth in the provisions described above in (c)(i) or (d) of the
Section titled "Termination," as the case may be, will relate to the failure of
the Company to perform, in any material respect, any of its material covenants
or agreements contained in the Merger Agreement or the material breach by the
Company of any of its material representations or warranties contained in the
Merger Agreement; or (iv) the Company enters into an agreement with respect to
an Acquisition Proposal or an Acquisition Proposal is consummated, in each case
within 12 months after the termination of the Merger Agreement pursuant to the
provisions described above in (c) or (d) of the Section titled "Termination,"
and the Company shall not theretofore have been required to pay the Fee to
Thomson pursuant to the provisions described above in (a)(i), (a)(ii) or
(a)(iii) of the Section titled "Termination"; then, in any such event, the
Company shall pay Thomson promptly (but in no event later than one business day
after the first of such events shall have occurred) a fee of $42,000,000, which
amount shall be payable in immediately available funds. Notwithstanding the
foregoing, the Company shall not be required to pay Thomson the Fee if this
Agreement is terminated pursuant to the provisions described above in the
Section titled "Termination" if the failure to consummate the Offer is the
result of the failure of the conditions set forth in clause (ii) of the
introductory paragraph or clause (a) or (b) of the conditions set forth in
Section 14 of the Offer to Purchase. In addition, notwithstanding the foregoing,
the Company shall be required to pay to Thomson only $11,000,000 of the Fee in
the event this Agreement is terminated due to the occurrence of any event in
clause (f) of the conditions set forth in Section 14 of the Offer to Purchase;
provided, that if the Company consummates a transaction that would be an
Acquisition Proposal within 12 months of the date of such Termination, the
Company shall pay to Thomson the balance of the Fee.
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THE SHAREHOLDERS AGREEMENT
The following is a summary of certain provisions of the Shareholders
Agreement, dated as of June 5, 2000 among Thomson, Purchaser, Joseph E.
Kasputys, the Chairman, President and Chief Executive Officer of the Company,
Stephen H. Curran, Executive Vice President and Chief Financial Officer of the
Company, and Michael R. Kargula, Executive Vice President, General Counsel and
Secretary of the Company (the "Shareholders Agreement").
TENDER OF SHARES. Each of Messrs. Kasputys, Curran and Kargula (the
"Shareholders") have agreed to tender all of their respective Shares in the
Offer, and not to withdraw such Shares from the Offer unless the Offer is
terminated.
VOTING AGREEMENT. Each of the Shareholders further agreed that from
June 5, 2000 until the termination of the Merger Agreement, at any meeting of
the shareholders of the Company, however called, and in any action by consent of
the shareholders of the Company, such Shareholder will vote such Shareholder's
Shares (i) in favor of the approval and adoption of the Merger Agreement, the
Merger and all the transactions contemplated by the Merger Agreement and
otherwise in such manner as may be necessary to consummate the Merger;
(ii) except as otherwise agreed to in writing by Thomson, against any action,
proposal, agreement or transaction that would result in a material breach of any
covenant, obligation, agreement, representation or warranty of the Company under
the Merger Agreement (whether or not theretofore terminated) or of the
Shareholder contained in the Shareholders Agreement; and (iii) against any
action, agreement or transaction that would materially delay or impair the
ability of the Company to consummate the transactions provided for in the Merger
Agreement or any Acquisition Proposal (as defined in the Merger Agreement).
IRREVOCABLE PROXY. Pursuant to the Shareholder Agreements, each of the
Shareholders irrevocably appointed Thomson and each of its officers as such
Shareholder's attorney, agent and proxy, with full power of substitution, to
vote and otherwise act (by written consent or otherwise) with respect to such
Shareholder's Shares at any meeting of shareholders of the Company or by written
consent in lieu of any such meeting or otherwise, on the matters and in the
manner specified in the paragraph above.
Pursuant to the Shareholders Agreement, each Shareholder agreed to revoke
all other proxies and powers of attorney with respect to such Shareholder's
Shares, and agreed that no subsequent proxy or power of attorney will be given
or written consent executed (and if given or executed, shall not be effective)
by any Shareholder with respect thereto.
NO DISPOSITION OR ENCUMBRANCE OF SHARES. Each of the Shareholders further
agreed that, except as contemplated by the Shareholders Agreement, such
Shareholder will not (i) sell, transfer, tender, pledge, assign, contribute to
the capital of any entity, hypothecate, give or otherwise dispose of, grant a
proxy or power of attorney with respect to, deposit into any voting trust, enter
into any voting agreement, or create or permit to exist any liens of any nature
whatsoever with respect to, any of such Shareholder's Shares other than the
making of bona fide gifts of Shares in an aggregate amount of not more than
10,000 Shares per Shareholder, (ii) other than as contemplated by the
Shareholders Agreement, take any action that would make any representation or
warranty of such Shareholder untrue or incorrect in any material respect or have
the effect of preventing or disabling such Shareholder from performing such
Shareholder's material obligations or (iii) directly or indirectly, initiate,
solicit or encourage any person to take actions that could reasonably be
expected to lead to the occurrence of any of the foregoing.
NO SOLICITATION OF TRANSACTIONS. Subject to each of the Shareholder's
fiduciary duties and obligations as an officer or director of the Company, each
Shareholder agreed that between June 5, 2000 and the date of termination of the
Merger Agreement, such Shareholder will not, directly or indirectly, solicit,
initiate, facilitate, including by furnishing any information to any person, or
encourage the submission of any Acquisition Proposal or any proposal that may
reasonably be expected to lead to, an Acquisition Proposal.
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TERMINATION. Each Shareholder's obligation under the Shareholders Agreement
to tender, and not withdraw, their Shares pursuant to the Offer will terminate
on the expiration date of the Offer. The remaining provisions of the
Shareholders Agreement will terminate, and no party will have any rights or
obligations under and the Shareholders Agreement shall become null and void and
have no further effect upon the earlier of (i) the effective time of the Merger
and (ii) the termination of the Merger Agreement.
THE CHANGE OF CONTROL AGREEMENTS
The purchase of Shares pursuant to the Offer and/or consummation of the
Merger will constitute a "change of control" of the Company for purposes of
employment and severance agreements the Company has entered into with Joseph E.
Kasputys, the Chairman, President and Chief Executive Officer of the Company,
Stephen H. Curran, Executive Vice President and Chief Financial Officer of the
Company, Michael R. Kargula, Executive Vice President, General Counsel and
Secretary of the Company, and certain other key employees, including other
officers of the Company. If Messrs. Kasputys, Curran, Kargula are terminated by
the Company without "cause" (as defined in each relevant agreement), or choose
to terminate their employment for "good reason" (as defined in each relevant
agreement), at any time within three years of the change of control, then such
officers will receive a lump sum payment, equal to three times the average of
the aggregate annual salary, bonus, and benefits (other than stock option gains
and certain specified bonuses and benefits) included in the gross income of such
officer during the five years preceding the Effective Time of the Merger. If the
other key employees are terminated by the Company without "cause," or choose to
terminate their employment for "good reason," at any time within a designated
period following a change of control, then such employees will receive,
generally, a lump sum payment equal to a multiple of the average of the
aggregate annual compensation included in the gross income of such employee
during the five years preceding the change of control (or such shorter period of
employment).
OFFICERS' LETTER AGREEMENTS. Messrs. Kasputys, Curran and Kargula have
entered into letter agreements with the Company, in connection with the Offer
and the Merger, in which they amend the change of control agreements that are
described above. Pursuant to the terms of these letter agreements,
Messrs. Kasputys, Curran and Kargula agree not to terminate their employment as
a result of their change in status as officers of a public company prior to the
later of the Effective Time of the Merger and January 1, 2001.
Messrs. Kasputys, Curran and Kargula further agree that the change of control
agreement, as amended by the letter agreement, will be the sole document
governing the payment of severance in connection with the termination of each of
their employment with the Company and that, accordingly, they will not be
entitled to any severance payments under any other agreement, plan, policy or
arrangement.
Upon a termination of Messrs. Kasputys, Curran or Kargula's employment by
the Company without cause or a resignation by Messrs. Kasputys, Curran or
Kargula for good reason during the period ending on the later of the Effective
Time of the Merger and January 1, 2001, or if Messrs. Kasputys, Curran or
Kargula remain continuously employed by the Company through the end of the
period ending in the later of the Effective Time of the Merger and January 1,
2001, Messrs. Kasputys, Curran or Kargula are entitled to severance benefits
described in their change of control agreements, as modified in the letter
agreement. Specifically, the letter agreements provide that "annual
compensation" for purposes of each of the change of control agreements of
Messrs. Kasputys, Curran and Kargula means the annual salary, bonus and benefits
(other than stock option gains) paid, respectively, to each executive and
includable in his gross income.
The agreements also provide that during the term of the agreement and for a
period equal to two years in the case of Mr. Kasputys, and one year in the case
of Messrs. Curran and Kargula, after the termination or expiration of the
individual's employment by the Company, however caused, (the "Restricted
Period"), the individual shall not engage in the Company's business as conducted
on June 5, 2000 or as it may be conducted during the course of the individual's
employment, or a business competitive with the Company's business; assist any
person in conducting a business competitive with the Company
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Business; or interfere with business relationships between the Company and
customers of or suppliers to the Company Business.
Messrs. Kasputys, Curran and Kargula each agreed that during and after the
Restricted Period, they shall keep secret and retain in strictest confidence all
confidential information relating to the Company business and shall not disclose
it to anyone outside of the Company and its affiliates, either during or after
employment by the Company or any of its affiliates, except (i) as required in
the course of performing their duties under the employment agreements or
(ii) with the Company's express written consent, or (iii) pursuant to legal
process.
Messrs. Kasputys, Kargula and Curran each also agreed that during the
Restricted Period and so long as he is employed by the Company, he shall not,
directly or indirectly, hire, solicit or encourage any employee other than his
assistants to leave the employment of the Company or any of its affiliates or
hire any such employee who has left the employment of the Company or any of its
affiliates within one year of the termination of such employee's employment with
the Company or any of its affiliates except for Messrs. Kasputys, Kargula,
Curran and their assistants.
RETIREMENT BENEFITS. Under the terms of Mr. Kasputys' employment agreement
with the Company, upon his retirement he will receive annual retirement
compensation for life in an amount that will equal 55% of his salary (not
including bonus) during his final year prior to retirement. In addition,
Mr. Kasputys' spouse will be entitled to certain benefits in the event
Mr. Kasputys predeceases his spouse. Thomson has guaranteed the Company's
obligation relating to Mr. Kasputys' retirement benefits.
In addition, the Company's Board of Directors recognized the long tenure and
extraordinary services provided to the Company by Messrs. Curran and Kargula by
providing that, upon their termination of employment, they will be deemed to be
retired under the Company's Supplemental Death Benefit and Retirement Income
Plan. Under that plan, each of Messrs. Curran and Kargula will receive an annual
cash retirement payment from the Company equal to 20% of their respective final
annual salary for each of the first ten years following such officer's
attainment of age 62.
OTHER EMPLOYMENT AGREEMENTS. In connection with the transactions
contemplated by the Merger Agreement, nine key employees of subsidiaries of the
Company have entered into employment agreements, effective as of the Effective
Time of the Merger, in each case with the Company subsidiary by which they are
currently employed. Pursuant to these employment agreements, each of these
individuals will continue to be employed by their respective employers in
comparable positions and performing comparable duties to those previously held
or performed, such employment to commence at the Effective Time of the Merger
and to continue for a period ending on the eighteen month anniversary of the
Effective Time, unless earlier terminated in accordance with the terms of their
respective agreements. These agreements generally provide that the employees
will be entitled to receive at least the same salary and bonus and comparable
benefits to those that each was entitled to receive before the Effective Time.
In addition, in each case, if the employee remains employed by the subsidiary at
the end of the eighteen-month term, the employee receives a special bonus paid
in a lump sum on the expiration of the eighteen-month term equal to one-half of
the employee's annual salary then in effect. In addition, in the event that an
employee's employment is terminated without Cause (as defined in the agreement),
an employee terminates his employment for good reason or upon the expiration of
the term of the agreement, unless the employer has previously offered to renew
the employment agreement on commercially reasonable terms, and at least equal to
the terms in these new agreements, then the employee will also receive a
continuation of his or her annual salary for the twelve months following the
termination of employment, certain insurance benefits for the twelve-month
period, and any earned and unpaid deferred compensation and/or long-term
incentive plan payments.
Four other key employees of a United Kingdom subsidiary of the Company
entered agreements with that subsidiary that provide for the payment of certain
lump sum bonuses if still employed by the subsidiary eighteen months after the
Effective Time and, in two cases, provide for the establishment of a long-term
incentive plan.
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CONFIDENTIALITY AGREEMENT
The following is a summary of certain provisions of the Confidentiality
Agreement, dated April 4, 2000, between the Company and Thomson (the
"Confidentiality Agreement"). This summary is qualified in its entirety by
reference to the Confidentiality Agreement, which is incorporated herein by
reference, and a copy of which has been filed with the Commission as an exhibit
to the Schedule TO. The Confidentiality Agreement may be examined and copies may
be obtained at the places set forth in Section 7.
Pursuant to the terms of the Confidentiality Agreement, the Company agreed
to provide Thomson certain non-public confidential and proprietary information
concerning the Company, Thomson on behalf of itself and any of its affiliates
that received any of the confidential information, agreed among other things:
(1) to keep the confidential information confidential, (2) not to use the
confidential information for any purpose other than to evaluate a possible
acquisition transaction with the Company, and (3) that neither Thomson nor any
of its affiliates would in any manner, directly or indirectly, except with the
prior written consent of the Board of Directors of the Company, for a period of
one year after the date of the Confidentiality Agreement or until the occurence
of a significant event (as defined below) whichever comes first, (a) acquire or
offer or agree to acquire by purchase or otherwise, any securities (or direct or
indirect rights or options to acquire any securities) of the Company in open
market (i.e., trading exchange) transactions (subject to an exception for
passive investments to be mutually agreed upon by the parties after the
execution of the Confidentiality Agreement), or seek by any action not permitted
under the Confidentiality Agreement to influence or control the management or
policies of the Company, or (b) publicly propose to (i) acquire or offer or
agree to acquire any securities (or direct or indirect rights or options to
acquire any securities) or assets of the Company or (ii) influence or control
the management or policies of the Company, or (c) directly or indirectly,
publicly present, or publicly propose to present, to the shareholders of the
Company any proposal or offer for a merger, tender or exchange offer or other
form of business combination involving the Company, or effect, publicly propose
to effect, or cause to occur any of the foregoing, that previously has not been
approved in writing by the Board of Directors of the Company, or (d) directly or
indirectly, solicit, or propose (whether publicly or otherwise) to solicit,
proxies or consents to vote or become a participant in any "election contest"
with respect to the Company (as such terms are used in Rule 14a-1 and
Rule 14a-11 of Regulation 14A under the Exchange Act). A "significant event"
means (i) the acquisition by a person or group of 15% or more of the Company's
voting securities, (ii) the announcement or commencement of a tender or exchange
for 15% or more of the Company's voting securities, or (iii) the Company
entering into or seeking to enter into any merger, sale or business combination
that would result in the Company's Common Stock being converted into cash or any
person or group owning 35% or more of the Company's Common Stock.
11. PURPOSE OF THE OFFER; PLANS FOR THE COMPANY AFTER THE OFFER AND THE
MERGER.
PURPOSE OF THE OFFER. The Offer is being made pursuant to the Merger
Agreement. The purpose of the Offer and the Merger is for Thomson to acquire
control of, and the entire equity interest in, the Company. The purpose of the
Merger is for Thomson to acquire all Shares not purchased pursuant to the Offer.
Upon consummation of the Merger, the Company will become a wholly owned
subsidiary of Thomson.
Under Michigan Law, the approval of the Board and the affirmative vote of
the holders of a majority of the outstanding Shares is required to approve and
adopt the Merger Agreement and the transactions contemplated thereby, including
the Merger. The Board of Directors of the Company has unanimously determined
that each of the Offer and the Merger is fair to, and in the best interests of,
the holders of Shares, has approved and adopted the Merger Agreement and the
Merger (such approval and adoption having been made in accordance with Michigan
Law) and has recommended that shareholders accept the Offer and tender their
Shares pursuant to the Offer. Unless the Merger is consummated pursuant to the
short-form merger provisions under Michigan Law as described below, the only
remaining required corporate action of the Company is the approval and adoption
of the Merger Agreement and the Merger
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by the affirmative vote of the holders of at least a majority of the Shares.
Accordingly, if the Minimum Condition is satisfied, Purchaser will have
sufficient voting power to cause the approval and adoption of the Merger
Agreement and the Merger without the affirmative vote of any other shareholder.
In the Merger Agreement, the Company has agreed to duly call, give notice
of, convene and hold an annual or special meeting of its shareholders as
promptly as practicable following consummation of the Offer for the purpose of
considering and taking action on the Merger Agreement and the Merger, if such
action is required by Michigan Law. Thomson and Purchaser have agreed that all
Shares owned by them and their subsidiaries will be voted in favor of the
approval and adoption of the Merger Agreement and the Merger.
The Merger Agreement provides that, promptly upon the purchase by Purchaser
of Shares pursuant to the Offer, Purchaser will be entitled to designate
representatives to serve on the Board in proportion to Purchaser's ownership of
Shares following such purchase. See Section 10. Purchaser expects that such
representation would permit Purchaser to exert substantial influence over the
Company's conduct of its business and operations.
SHORT-FORM MERGER. Under Michigan Law, if Purchaser acquires, pursuant to
the Offer or otherwise, at least 90% of the then outstanding Shares, Purchaser
will be able to approve the Merger without a vote of the Company's shareholders.
In such event, Thomson, Purchaser and the Company have agreed in the Merger
Agreement to take, at the request of Purchaser, all necessary and appropriate
action to cause the Merger to become effective as promptly as reasonably
practicable after such acquisition, without a meeting of the Company's
shareholders. If, however, Purchaser does not acquire at least 90% of the
outstanding Shares pursuant to the Offer or otherwise and a vote of the
Company's shareholders is required under Michigan Law, a significantly longer
period of time would be required to effect the Merger.
APPRAISAL RIGHTS. Thomson and the Purchaser do not believe that appraisal
rights are available in connection with the Offer. Notwithstanding the
foregoing, if the Merger is consummated, shareholders who have not tendered
their Shares may have certain rights under Michigan Law to dissent from the
Merger and demand appraisal of, and to receive payment in cash of the fair value
of, their Shares. Shareholders who perfect such rights by complying with the
procedures set forth in Sections 450.1761 to 450.1774 of the Michigan Business
Corporation Act will have the "fair value" of their Shares (exclusive of any
element of value arising from the accomplishment or expectation of the Merger)
determined by the Michigan Circuit Court and will be entitled to receive a cash
payment equal to such fair value for the Surviving Corporation. In addition,
such dissenting shareholders may be entitled to receive payment of a fair rate
of interest from the date of consummation of the Merger on the amount determined
to be the fair value of their Shares.
Thomson does not intend to object, assuming the proper procedures are
followed, to the exercise of appraisal rights by any shareholder and the demand
for appraisal of, and payment in cash for the fair value of, the Shares. Thomson
intends, however, to cause the Surviving Corporation to argue in an appraisal
proceeding that, for purposes of such proceeding, the fair value of each Share
is less than or equal to the Merger Consideration. In this regard, shareholders
should be aware that opinions of investment banking firms as to the fairness
from a financial point of view (including Deutsche Bank's) are not necessarily
opinions as to "fair value" under Michigan law.
The foregoing summary of the rights of dissenting shareholders under
Michigan Law does not purport to be a complete statement of the procedures to be
followed by shareholders desiring to exercise any dissenters' rights under
Michigan Law. The preservation and exercise of dissenters' rights require strict
adherence to the applicable provisions of Michigan Law.
GOING PRIVATE TRANSACTIONS. The Commission has adopted Rule 13e-3 under the
Exchange Act which is applicable to certain "going private" transactions and
which may under certain circumstances be applicable to the Merger or another
business combination following the purchase of Shares pursuant to the Offer in
which Purchaser seeks to acquire the remaining Shares not held by it. Purchaser
believes that
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Rule 13e-3 will not be applicable to the Merger. Rule 13e-3 requires, among
other things, that certain financial information concerning the Company and
certain information relating to the fairness of the proposed transaction and the
consideration offered to minority shareholders in such transaction be filed with
the Commission and disclosed to shareholders prior to consummation of the
transaction.
PLANS FOR THE COMPANY. It is expected that following the Merger, Thomson
will continue to evaluate the business and operations of the Company and will
take such actions as it deems appropriate under circumstances then existing.
Thomson will continue to seek additional information about the Company and
employ consultants to aid it in its evaluation during the pendency of the Offer
and after consummation of the Offer. Thereafter, Thomson intends to review such
information as part of a comprehensive review of the Company's business,
operations, capitalization and management with a view to optimizing exploitation
of the Company's potential in conjunction with Thomson's businesses, including,
but not limited to, aligning the Company's businesses with the businesses within
Thomson Financial. It is expected that the business and operations of the
Company would form an important part of Thomson's future business plans.
12. DIVIDENDS AND DISTRIBUTIONS.
The Merger Agreement provides that the Company shall not, between the date
of the Merger Agreement and the Effective Time, without the prior written
consent of Thomson, which consent will not be unreasonably withheld, (a) issue,
sell, pledge, dispose of, grant, encumber, or authorize the issuance, sale,
pledge, disposition, grant or encumbrance of (i) any shares of any class of
capital stock of the Company or any subsidiaries, or any options, warrants,
convertible securities or other rights of any kind to acquire any shares of such
capital stock, or any other ownership interest (including, without limitation,
any phantom interest), of the Company or any subsidiaries (except for the
issuance of a maximum of 4,933,628 Shares issuable pursuant to options
outstanding on June 5, 2000 under the Company stock option plans), or (ii) any
material assets of the Company or any subsidiaries, except in the ordinary
course of business consistent with past practice; (b) declare, set aside, make
or pay any dividend or other distribution, payable in cash, stock, property or
otherwise, with respect to any of its capital stock except that a wholly owned
Subsidiary may declare and pay a dividend or make an advance to its Thomson or
the Company or (c) reclassify, combine, split, subdivide or redeem, or purchase
or otherwise acquire, directly or indirectly, any of its capital stock. See
Section 10.
13. POSSIBLE EFFECTS OF THE OFFER ON THE MARKET FOR SHARES, NYSE LISTING,
PCX LISTING, EXCHANGE ACT REGISTRATION, MARGIN REGULATIONS.
POSSIBLE EFFECTS OF THE OFFER ON THE MARKET FOR THE SHARES. The purchase of
Shares by Purchaser pursuant to the Offer will reduce the number of Shares that
might otherwise trade publicly and will reduce the number of holders of Shares,
which could adversely affect the liquidity and market value of the remaining
Shares held by the public.
Thomson intends to cause the delisting of the Shares by the NYSE and the PCX
following consummation of the Offer.
NYSE LISTING. Depending upon the number of Shares purchased pursuant to the
Offer, the Shares may no longer meet the standards for continued listing on the
NYSE. According to NYSE's published guidelines, the Shares would not be eligible
to be included for listing if, among other things, the number of Shares publicly
held falls below 600,000, or the number of holders of Shares falls below 400 or
the number of holders of shares falls below 1,200 and the average monthly
trading volume (for most recent 12 months) is less than 100,000 shares. If, as a
result of the purchase of Shares pursuant to the Offer, the Merger, the Merger
Agreement or otherwise, the Shares no longer meet the requirements of the NYSE
for continued listing, the listing of the Shares will be discontinued. In such
event, the market for the Shares would be adversely affected. In the event the
Shares were no longer eligible for listing on the NYSE, quotations might still
be available from other sources. The extent of the public market for the Shares
and the
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availability of such quotations would, however, depend upon the number of
holders of such Shares remaining at such time, the interest in maintaining a
market in such Shares on the part of securities firms, the possible termination
of registration of such Shares under the Exchange Act as described below and
other factors.
PCX LISTING. Depending upon the number of Shares purchased pursuant to the
Offer, the Shares may no longer meet the standards for continued listing on the
PCX. The Shares will no longer be eligible to be included for listing if, among
other things, either the number of Shares publicly held falls below 300,000 or
the market value falls below $500,000, or the number of public beneficial
holders falls below 250. If, as a result of the purchase of Shares pursuant to
the Offer, the Merger, the Merger Agreement or otherwise, the Shares no longer
meet the requirements of the PCX for continued listing, the listing of the
Shares will be discontinued. In such event, the market for the Shares would be
adversely affected. In the event the Shares were no longer eligible for listing
on the PCX, quotations might still be available from other sources. The extent
of the public market for the Shares and the availability of such quotations
would, however, depend upon the number of holders of such Shares remaining at
such time, the interest in maintaining a market in such Shares on the part of
securities firms, the possible termination of registration of such Shares under
the Exchange Act as described below and other factors.
EXCHANGE ACT REGISTRATION. The Shares are currently registered under the
Exchange Act. Such registration may be terminated upon application by the
Company to the Commission if the Shares are not listed on a "national securities
exchange" and there are fewer than 300 record holders. The termination of the
registration of the Shares under the Exchange Act would substantially reduce the
information required to be furnished by the Company to holders of Shares and to
the Commission and would make certain provisions of the Exchange Act, such as
the short-swing profit recovery provisions of Section 16(b) of the Exchange Act,
the requirement of furnishing a proxy statement in connection with shareholders'
meetings pursuant to Section 14(a) or 14(c) of the Exchange Act and the related
requirements of an annual report, and the requirements of Rule 13e-3 under the
Exchange Act with respect to "going private" transactions, no longer applicable
to the Shares. In addition, "affiliates" of the Company and persons holding
"restricted securities" of the Company may be deprived of the ability to dispose
of such securities pursuant to Rule 144 promulgated under the Securities Act of
1933, as amended. If registration of the Shares under the Exchange Act were
terminated, the Shares would no longer be eligible for NYSE reporting. Purchaser
currently intends to seek to cause the Company to terminate the registration of
the Shares under the Exchange Act as soon after consummation of the Offer as the
requirements for termination of registration are met.
MARGIN REGULATIONS. The Shares are currently "margin securities," as such
term is defined under the rules of the Board of Governors of the Federal Reserve
System (the "Federal Reserve Board"), which has the effect, among other things,
of allowing brokers to extend credit on the collateral of such securities.
Depending upon factors similar to those described above regarding listing and
market quotations, following the Offer it is possible that the Shares might no
longer constitute "margin securities" for purposes of the margin regulations of
the Federal Reserve Board, in which event such Shares could no longer be used as
collateral for loans made by brokers. In addition, if registration of the Shares
under the Exchange Act were terminated, the Shares would no longer constitute
"margin securities."
14. CERTAIN CONDITIONS OF THE OFFER.
Notwithstanding any other provision of the Offer, Purchaser shall not be
required to accept for payment any Shares tendered pursuant to the Offer, and
may extend, terminate or amend the Offer, if (i) immediately prior to the
expiration of the Offer, the Minimum Condition shall not have been satisfied,
(ii) any applicable waiting period under the HSR Act, the antitrust laws in the
Federal Republic of Germany and the United Kingdom and in the other countries
where a merger filing was necessary shall not
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have expired or been terminated prior to the expiration of the Offer, or
(iii) at any time on or after June 5, 2000 and prior to the expiration of the
Offer, any of the following conditions shall exist:
(a) there shall have been instituted, threatened or be pending any
action before any governmental authority (i) challenging or seeking to make
illegal, materially delay, or otherwise, directly or indirectly, restrain or
prohibit or make materially more costly, the making of the Offer, the
acceptance for payment of any Shares by Thomson, Purchaser or any other
affiliate of Thomson, or the purchase of Shares pursuant to any Shareholder
Agreement, or the consummation of any other transaction contemplated by the
Merger Agreement ("Transaction"), or seeking to obtain material damages in
connection with any Transaction; (ii) seeking to prohibit or limit
materially the ownership or operation by the Company, Thomson or any of
their subsidiaries of all or any of the business or assets of the Company,
Thomson or any of their subsidiaries that is material to either Thomson and
its subsidiaries or the Company and the Subsidiaries, in either case, taken
as a whole, or to compel the Company, Thomson or any of their subsidiaries,
as a result of the Transactions, to dispose of or to hold separate all or
any portion of the business or assets of the Company, Thomson or any of
their subsidiaries that is material to either Thomson and its subsidiaries
or the Company and the Subsidiaries, in each case, taken as a whole;
(iii) seeking to impose or confirm any limitation on the ability of Thomson,
Purchaser or any other affiliate of Thomson to exercise effectively full
rights of ownership of any Shares, including, without limitation, the right
to vote any Shares acquired by Purchaser pursuant to the Offer or otherwise
on all matters properly presented to the Company's shareholders, including,
without limitation, the approval and adoption of this Agreement and the
Transactions; (iv) seeking to require divestiture by Thomson, Purchaser or
any other affiliate of Thomson of any Shares; or (v) which otherwise would
prevent or materially delay consummation of the Offer or the Merger or would
have a Material Adverse Effect (as defined in the Merger Agreement);
(b) there shall have been any statute, rule, regulation, legislation or
interpretation enacted, promulgated, amended, issued or deemed applicable to
(i) Thomson, the Company or any subsidiary or affiliate of Thomson or the
Company or (ii) any Transaction, by any United States or non-United States
legislative body or governmental authority with appropriate jurisdiction,
other than the routine application of the waiting period provisions of the
HSR Act and in the other countries where a merger filing was necessary or
advisable, to the Offer, the Shareholders Agreement or the Merger, that is
reasonably likely to result, directly or indirectly, in any of the
consequences referred to in clauses (i) through (v) of paragraph (a) above;
(c) any Material Adverse Effect shall have occurred;
(d) there shall have occurred (i) any general suspension of trading in,
or limitation on prices for, securities on the New York Stock Exchange or
the Pacific Exchange, Inc. (other than a shortening of trading hours or any
coordinated trading halt triggered solely as a result of a specified
increase or decrease in a market index), (ii) a declaration of a banking
moratorium or any suspension of payments in respect of banks in the United
States or Canada, (iii) any limitation (whether or not mandatory) by any
government or governmental authority, on the extension of credit by banks or
other lending institutions, (iv) a commencement of a war or armed
hostilities or other national or international calamity directly or
indirectly involving the United States or Canada or (v) in the case of any
of the foregoing existing on the date hereof, a material acceleration or
worsening thereof;
(e) (i) it shall have been publicly disclosed, or Purchaser shall have
otherwise learned, that beneficial ownership (determined for the purposes of
this paragraph as set forth in Rule 13d-3 promulgated under the Exchange
Act) of 15% or more of the then-outstanding Shares has been acquired by any
person, other than Thomson or any of its affiliates, or (ii) (A) the Board,
or any committee thereof, shall have withdrawn or modified, in a manner
adverse to Thomson or Purchaser, the approval or recommendation of the
Offer, the Merger, or the Agreement, or approved or recommended any
Acquisition Proposal (as defined in the Merger Agreement) other than the
Offer
38
<PAGE>
or the Merger or (B) the Board, or any committee thereof, shall have
resolved to do any of the foregoing;
(f) the representations and warranties of the Company set forth in the
Merger Agreement shall not be true and accurate (without giving effect to
any qualification as to "materiality" or "Material Adverse Effect" set forth
therein) as of the date of consummation of the Offer as though made on or as
of such date or the Company shall have breached or failed to perform or
comply with any material obligation, agreement or covenant required by the
Merger Agreement to be performed of complied with by it except, in each
case, (A) those representations and warranties that address matters only as
of a particular date or only with respect to a specified period of time
which need only be true and accurate as of such date or with respect to such
period or (B) where the failure of such representations and warranties to be
true and correct, or the failure to perform or comply with such obligations,
agreements or covenants, would not, individually or in the aggregate, have a
Material Adverse Effect; or
(g) the Agreement shall have been terminated in accordance with its
terms,
which, in the reasonable judgment of Purchaser in any such case, and regardless
of the circumstances (including any action or inaction by Thomson or any of its
affiliates) giving rise to any such condition, makes it inadvisable to proceed
with such acceptance for payment.
The foregoing conditions are for the sole benefit of Purchaser and Thomson
and may be asserted by Purchaser or Thomson regardless of the circumstances
giving rise to any such condition or may be waived by Purchaser or Thomson in
whole or in part at any time and from time to time in their sole discretion. The
failure by Thomson or Purchaser at any time to exercise any of the foregoing
rights shall not be deemed a waiver of any such right; the waiver of any such
right with respect to particular facts and other circumstances shall not be
deemed a waiver with respect to any other facts and circumstances; and each such
right shall be deemed an ongoing right that may be asserted at any time and from
time to time.
15. CERTAIN LEGAL MATTERS AND REGULATORY APPROVALS.
GENERAL. Based upon its examination of publicly available information with
respect to the Company and the review of certain information furnished by the
Company to Thomson and discussions between representatives of Thomson with
representatives of the Company during Thomson's investigation of the Company,
neither Purchaser nor Thomson is aware of (i) any license or other regulatory
permit that appears to be material to the business of the Company or any of its
subsidiaries, taken as a whole, which might be adversely affected by the
acquisition of Shares by Purchaser pursuant to the Offer or (ii) except as set
forth below, of any approval or other action by any domestic (federal or state)
or foreign governmental authority which would be required prior to the
acquisition of Shares by Purchaser pursuant to the Offer. Should any such
approval or other action be required, it is Purchaser's present intention to
seek such approval or action. Purchaser does not currently intend, however, to
delay the purchase of Shares tendered pursuant to the Offer pending the outcome
of any such action or the receipt of any such approval (subject to Purchaser's
right to decline to purchase Shares if any of the conditions in Section 14 shall
have occurred). There can be no assurance that any such approval or other
action, if needed, would be obtained without substantial conditions or that
adverse consequences might not result to the business of the Company, Purchaser
or Thomson or that certain parts of the businesses of the Company, Purchaser or
Thomson might not have to be disposed of or held separate or other substantial
conditions complied with in order to obtain such approval or other action or in
the event that such approval was not obtained or such other action was not
taken. Purchaser's obligation under the Offer to accept for payment and pay for
Shares is subject to certain conditions, including conditions relating to the
legal matters discussed in this Section 15. See Section 14 for certain
conditions of the Offer.
STATE TAKEOVER LAWS. The Company is incorporated under the laws of the
State of Michigan. In general, Section 450.1780 of Michigan Law prevents an
"interested shareholder" (generally a person who owns or has the right to
acquire 10% or more of a corporation's outstanding voting stock, or an affiliate
or associate thereof) from engaging in a "business combination" (defined to
include mergers and certain
39
<PAGE>
other transactions) with a Michigan corporation for a period of five years
following the date such person became an interested shareholder unless, among
other things, prior to such date the board of directors of the corporation
approved either the business combination or the transaction in which the
interested shareholder became an interested shareholder. On June 4, 2000, prior
to the execution of the Merger Agreement, the Board by unanimous vote of all
directors present at a meeting held on such date, approved the Merger Agreement,
determined that each of the Offer and the Merger is fair to, and in the best
interest of, the shareholders of the Company. Accordingly, Section 450.1780 is
inapplicable to the Offer and the Merger.
A number of other states have adopted laws and regulations applicable to
attempts to acquire securities of corporations which are incorporated, or have
substantial assets, shareholders, principal executive offices or principal
places of business, or whose business operations otherwise have substantial
economic effects, in such states. In EDGAR V. MITE CORPORATION, the Supreme
Court of the United States invalidated on constitutional grounds the Illinois
Business Takeover Statute, which, as a matter of state securities law, made
takeovers of corporations meeting certain requirements more difficult. However,
in 1987 in CTS CORPORATION V. DYNAMICS CORPORATION OF AMERICA, the Supreme Court
held that the State of Indiana may, as a matter of corporate law and, in
particular, with respect to those aspects of corporate law concerning corporate
governance, constitutionally disqualify a potential acquiror from voting on the
affairs of a target corporation without the prior approval of the remaining
shareholders. The state law before the Supreme Court was by its terms applicable
only to corporations that had a substantial number of shareholders in the state
and were incorporated there.
The Company, directly or through its subsidiaries, conducts business in a
number of states throughout the United States, some of which have enacted
takeover laws. Purchaser does not know whether any of these laws will, by their
terms, apply to the Offer or the Merger and has not complied with any such laws.
Should any person seek to apply any state takeover law, Purchaser will take such
action as then appears desirable, which may include challenging the validity or
applicability of any such statute in appropriate court proceedings. In the event
it is asserted that one or more state takeover laws is applicable to the Offer
or the Merger, and an appropriate court does not determine that it is
inapplicable or invalid as applied to the Offer, Purchaser might be required to
file certain information with, or receive approvals from, the relevant state
authorities. In addition, if enjoined, Purchaser might be unable to accept for
payment any Shares tendered pursuant to the Offer, or be delayed in continuing
or consummating the Offer, and the Merger. In such case, Purchaser may not be
obligated to accept for payment any Shares tendered. See Section 14.
ANTITRUST. Under the HSR Act and the rules that have been promulgated
thereunder by the FTC, certain acquisition transactions may not be consummated
unless certain information has been furnished to the Antitrust Division and the
FTC and certain waiting period requirements have been satisfied. The acquisition
of Shares by Purchaser pursuant to the Offer are subject to such requirements.
See Section 2.
Pursuant to the HSR Act, on June 12, 2000, Thomson filed a Premerger
Notification and Report Form in connection with the purchase of Shares pursuant
to the Offer with the Antitrust Division and the FTC. Under the provisions of
the HSR Act applicable to the Offer, the purchase of Shares pursuant to the
Offer may not be consummated until the expiration of a 15-calendar day waiting
period following the filing by Thomson. Accordingly, the waiting period under
the HSR Act applicable to the purchase of Shares pursuant to the Offer will
expire at 11:59 p.m., New York City time, on June 27, 2000, unless such waiting
period is earlier terminated by the FTC and the Antitrust Division or extended
by a request from the FTC or the Antitrust Division for additional information
or documentary material prior to the expiration of the waiting period. Pursuant
to the HSR Act, Thomson has requested early termination of the waiting period
applicable to the Offer. There can be no assurance, however, that the 15-day HSR
Act waiting period will be terminated early. If either the FTC or the Antitrust
Division were to request additional information or documentary material from
Thomson with respect to the Offer, the waiting period with respect to the Offer
would expire at 11:59 p.m., New York City time, on the tenth calendar day after
the date of
40
<PAGE>
substantial compliance with such request. Thereafter, the waiting period could
be extended only by court order or with the consent of Thomson. If the
acquisition of Shares is delayed pursuant to a request by the FTC or the
Antitrust Division for additional information or documentary material pursuant
to the HSR Act, the Offer shall be extended and, in any event, the purchase of
and payment for Shares will be deferred until 10 days after the request is
substantially complied with, unless the waiting period is sooner terminated by
the FTC and the Antitrust Division. Only one extension of such waiting period
pursuant to a request for additional information is authorized by the HSR Act
and the rules promulgated thereunder, except by court order. Any such extension
of the waiting period will not give rise to any withdrawal rights not otherwise
provided for by applicable law. See Section 4. It is a condition to the Offer
that the waiting period applicable under the HSR Act to the Offer expire or be
terminated. See Section 2 and Section 14.
The FTC and the Antitrust Division frequently scrutinize the legality under
the antitrust laws of transactions such as the proposed acquisition of Shares by
Purchaser pursuant to the Offer. At any time before or after the purchase of
Shares pursuant to the Offer by Purchaser, the FTC or the Antitrust Division
could take such action under the antitrust laws as it deems necessary or
desirable in the public interest, including seeking to enjoin the purchase of
Shares pursuant to the Offer or seeking the divestiture of Shares purchased by
Purchaser or the divestiture of substantial assets of Thomson, the Company or
their respective subsidiaries. Private parties and state attorneys general may
also bring legal action under federal or state antitrust laws under certain
circumstances. Based upon an examination of information available to Thomson
relating to the businesses in which Thomson, the Company and their respective
subsidiaries are engaged, Thomson and Purchaser believe that the Offer will not
violate the antitrust laws. Nevertheless, there can be no assurance that a
challenge to the Offer on antitrust grounds will not be made or, if such a
challenge is made, what the result would be. See Section 14 for certain
conditions to the Offer, including conditions with respect to litigation.
The parties intend to provide notice of their plan and intent to merge to
the Office of Fair Trading in the United Kingdom (the "OFT") as soon as
possible. After an initial review of the plan of merger by the OFT, which may
last for several weeks, the Secretary of State for Trade and Industry in the
United Kingdom will decide whether or not to refer the merger to the Competition
Commission for a full investigation. Reference to the Competition Commission is
usually made on competition grounds and the Competition Commission is usually
given a period of 3 to 4 months to complete its report, which is then published
by the Secretary of State for Trade and Industry approximately one month later.
If following reference to the Competition Commission it finds that the merger
may operate against the public interest, the Secretary of State for Trade and
Industry in the United Kingdom may prohibit its consummation, or order partial
divestiture, or may accept other undertakings from the companies concerned.
The parties intend to notify the proposed merger to the German Federal
Cartel Office (the "FCO") as soon as possible. After an initial review of the
proposed merger by the FCO, which may last for 1 month, the FCO will decide
whether to clear the proposed merger or open a second stage investigation, which
may last for a further period of 3 months. If following the investigation, the
FCO has found that the proposed merger would create or strengthen a dominant
position in Germany, the FCO may take such actions as it deems necessary or
desirable in the public interest to prevent the proposed merger from being
implemented in respect of the German market.
Thomson and the Company conduct operations in a number of jurisdictions
where other regulatory filings or approvals may be required or advisable in
connection with the completion of the merger. Thomson and the Company are
currently in the process of reviewing whether filings or approvals may be
required or desirable in these jurisdictions which may be material to Thomson
and the Company and its subsidiaries. It is possible that one or more of these
filings may not be made, or one or more of these approvals, which are not as a
matter of practice required to be obtained prior to effectiveness of a merger
transaction, may not be obtained, prior to the merger.
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<PAGE>
16. FEES AND EXPENSES.
Except as set forth below, Purchaser will not pay any fees or commissions to
any broker, dealer or other person for soliciting tenders of Shares pursuant to
the Offer.
Morgan Stanley & Co. Incorporated is acting as Dealer Manager in connection
with the Offer and has provided certain financial advisory services to Thomson
and Purchaser in connection with the acquisition of the Company. Thomson has
agreed to pay Morgan Stanley & Co. Incorporated reasonable and customary
compensation for such services. Thomson has also agreed to reimburse Morgan
Stanley & Co. Incorporated for all reasonable out-of-pocket expenses incurred by
Morgan Stanley & Co. Incorporated, including the reasonable fees and expenses of
legal counsel and to indemnify Morgan Stanley & Co. Incorporated against
liabilities under the federal securities laws.
Purchaser and Thomson have retained Innisfree M&A Incorporated, as the
Information Agent, and ChaseMellon Shareholder Services, L.L.C., as the
Depositary, in connection with the Offer. The Information Agent may contact
holders of Shares by mail, telephone, telex, telecopy, telegraph and personal
interview and may request banks, brokers, dealers and other nominee shareholders
to forward materials relating to the Offer to beneficial owners. As compensation
for acting as Information Agent in connection with the Offer, Innisfree M&A
Incorporated will be paid a fee of $15,000 for its services and will also be
reimbursed for certain out-of-pocket expenses and may be indemnified against
certain liabilities and expenses in connection with the Offer, including certain
liabilities under the federal securities laws.
Purchaser will pay the Depositary reasonable and customary compensation for
its services in connection with the Offer, plus reimbursement for out-of-pocket
expenses, and will indemnify the Depositary against certain liabilities and
expenses in connection therewith, including under federal securities laws.
Brokers, dealers, commercial banks and trust companies will be reimbursed by
Purchaser for customary handling and mailing expenses incurred by them in
forwarding material to their customers.
17. MISCELLANEOUS.
The Offer is being made solely by this Offer to Purchase and the related
Letter of Transmittal and is being made to holders of Shares. Purchaser is not
aware of any jurisdiction where the making of the Offer is prohibited by any
administrative or judicial action pursuant to any valid state statute. If
Purchaser becomes aware of any valid state statute prohibiting the making of the
Offer or the acceptance of Shares pursuant thereto, Purchaser will make a good
faith effort to comply with any such state statute. If, after such good faith
effort, Purchaser cannot comply with any such state statute, the Offer will not
be made to (nor will tenders be accepted from or on behalf of) the holders of
Shares in such state. In any jurisdiction where the securities, blue sky or
other laws require the Offer to be made by a licensed broker or dealer, the
Offer shall be deemed to be made on behalf of Purchaser by the Dealer Manager or
by one or more registered brokers or dealers licensed under the laws of such
jurisdiction.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR MAKE ANY
REPRESENTATION ON BEHALF OF PURCHASER OR THE COMPANY NOT CONTAINED IN THIS OFFER
TO PURCHASE OR IN THE LETTER OF TRANSMITTAL, AND IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED.
Pursuant to Rule 14d-3 of the General Rules and Regulations under the
Exchange Act, Thomson and Purchaser have filed with the Commission the Schedule
TO, together with exhibits, furnishing certain additional information with
respect to the Offer. The Schedule TO and any amendments thereto, including
exhibits, may be inspected at, and copies may be obtained from, the same places
and in the same manner as set forth in Section 7 (except that they will not be
available at the regional offices of the Commission).
MARQUEE ACQUISITION CORPORATION
Dated: June 14, 2000
42
<PAGE>
SCHEDULE I
INFORMATION CONCERNING THE DIRECTORS AND EXECUTIVE
OFFICERS OF THOMSON AND PURCHASER
1. DIRECTORS AND EXECUTIVE OFFICERS OF THOMSON. The following table sets
forth the name, current business address, citizenship and present principal
occupation or employment, and material occupations, positions, offices or
employments and business addresses thereof for the past five years of each
director and executive officer of Thomson. Except for Alan M. Lewis, who is a
citizen of Canada, Great Britain and South Africa, David J. Hulland, Martin B.
Jones and Stuart Garner who are citizens of Great Britain and Richard J.
Harrington, Brian Hall, Patrick Tierney, Ronald Schlosser, Michael Harris,
Steven Denning, Vance Opperman, David Shaffer, Robert Daleo, Robert Christie,
Theron Hoffman, John Kechejian and Janey Loyd who are citizens of the United
States, each such person is a citizen of Canada. Unless otherwise indicated,
each occupation set forth opposite an individual's name refers to employment
with Thomson.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS HELD
NAME, AGE AND DURING THE PAST FIVE YEARS AND
CURRENT BUSINESS ADDRESS BUSINESS ADDRESSES THEREOF
------------------------------------------------ ------------------------------------------------------------
<S> <C>
Kenneth R. Thomson, 76 Chairman of Thomson since July 1978. Director of Thomson
The Woodbridge Company Limited since July 1976. Chairman of The Woodbridge Company Limited
65 Queen Street West ("Woodbridge"), 65 Queen Street West, Toronto, Ontario M5H
Toronto, Ontario M5H 2M8 2M8, Canada, since March 1979. Director of Woodbridge since
Canada August 1956.
John A. Tory, 69 Deputy Chairman of Thomson from February 1978 to December
The Woodbridge Company Limited 31, 1997. Director of Thomson since February 1978. Director
65 Queen Street West of Abitibi Consolidated, Inc., 207 Queens Quay West,
Toronto, Ontario M5H 2M8 Toronto, Ontario M5J 2P5, Canada, since September 1965.
Canada Director of Rogers Communications Inc., 40 King Street West,
Toronto, Ontario M5H 3Y2, Canada, since December 1979.
Director, Sun Life Insurance Company of Canada, 150 King
Street West, Toronto, Ontario M5H 1J9, Canada, from December
1971 to 1994. Director of Woodbridge, 65 Queen Street West,
Toronto, Ontario M5H 2M8, Canada, since October 1967.
President of Woodbridge from March 1979 to 1998. Director of
Hudson's Bay Company, 401 Bay Street, Toronto, Ontario M5H
2Y4, Canada, since May 1979. Deputy Chairman and Director of
Markborough Properties Inc., One Dundas Street West, Suite
2800, Toronto, Ontario M5G 2J2, since September 1989.
Director of The Thomson Corporation PLC, First Floor, the
Quandrangle, 180 Wardour Street, W1A 4YG, England, since
December 1977. Director of the Royal Bank of Canada, Royal
Bank Plaza, 9(th) Floor, South Tower, Toronto, Ontario M5J
2J5 from 1971 to 2000.
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS HELD
NAME, AGE AND DURING THE PAST FIVE YEARS AND
CURRENT BUSINESS ADDRESS BUSINESS ADDRESSES THEREOF
------------------------------------------------ ------------------------------------------------------------
<S> <C>
Ronald D. Barbaro, 68 Director of Thomson since May 1993. Director, Clairvest
Ontario Lottery and Gaming Corporation Group Inc., Suite 1700, 22 St. Clair Avenue East, Toronto,
4120 Yonge Street, Suite 420 Ontario M4V 2S3, Canada, from September 1994 to 1998.
Toronto, Ontario M2P 2158 Director of Equifax Canada, 7171 Jean Talon East, Anjou,
Canada Quebec H1M 3N2, Canada, since June 1997. Director of
ChoicePoint, Inc., 1000 Alderman Drive, Alpharetta, Georgia
30005, since July 1997. Director of Prudential of America
Life Insurance Company of Canada ("PALI"), c/o Prudential of
America Insurance Co. (Canada), 200 Consilium Place,
Scarborough, Ontario M1H 3E6, Canada, since January 1991.
Chairman of PALI from 1992 to January 1997. President of
Prudential Insurance Company of America, Inc., 260 Madison
Avenue, Second Floor, New York, New York 10116, from 1990 to
1993. President of Worldwide Operations Prudential Insurance
Company of America-Canada, from 1985 to 1990. Director of
Equifax Inc., 1600 Peachtree Street, N.W., Atlanta, Georgia
30309, from April 1992 to July 1997. Director, Canbra Foods
Ltd., P.O. Box 99, 2415 2nd Avenue "A" North, Lethbridge,
Alberta, T1J 3Y4, Canada, since July 1988; interim-Chairman
since March 1996; Chairman since March 1997. Director,
Consoltex Group Inc., 8555 TransCanada Highway, Ville Saint-
Laurent, Quebec H4S 1Z6, Canada, since May 1997. Director,
Flow International Corporation, 2300-64th Avenue South,
Kent, Washington 98032, since 1995. Chairman, Natraceuticals
Inc., 8290 Woodbine Avenue, Markham, Ontario L3R 9W9,
Canada, since February 1997. Director, Signature Security
Group Inc., 26-28 Market Street, Sydney, NSW, Australia,
since March 1997. Director, VoxCom Incorporated,
#102,4209-99 Street, Edmonton, Alberta T6E 5V7, Canada,
since December 1996. Director, O'Donnell Investment
Management Corporation, 4100 Yonge Street, Suite 601,
Toronto, Ontario M2P 2B5, Canada, since April 1997.
W. Geoffrey Beattie, 40 Deputy Chairman of Thomson since May 18, 2000. Director of
The Woodbridge Company Limited Thomson since May 1998. President of Woodbridge since 1998.
65 Queen Street West From 1990 to 1998, attorney (partner from 1993) at Torys
Toronto, Ontario M5H 2M8 (formerly Tory, Tory, DesLauriers & Binnington). Director of
Canada Playdium Entertainment Corporation since 1996. Director of
The Bioscience Corp. since 1996. Director of Genesis Organic
Inc. since 1996. Director of National Ballet of Canada since
1996.
</TABLE>
I-2
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS HELD
NAME, AGE AND DURING THE PAST FIVE YEARS AND
CURRENT BUSINESS ADDRESS BUSINESS ADDRESSES THEREOF
------------------------------------------------ ------------------------------------------------------------
<S> <C>
V. Maureen Kempston Darkes, 51 Director of Thomson since May 1996. Chairman and General
General Motors of Canada Limited Manager, General Motors of Canada Limited ("GMCL"),
1908 Colonel Sam Drive 1908 Colonel Sam Drive, Oshawa, Ontario L1H 8T7. Director of
Oshawa, Ontario L1H8T7 CAMI Automotive Inc., P.O. Box 1005, 300 Ingersoll Street,
Canada Ingersoll, Ontario N5C 4A6, Canada. Director of the
Education Quality and Accountability Office (Ontario
Government), 2 Carlton Street, Suite 1200, Toronto, Ontario
M5B 2M9. Director of GMCL since August 1991. Vice President
of GMCL from August 1991 to July 1994. Director, CN Rail,
935 de la Gauchetiere Street West, Montreal, Quebec, Canada
since March 1995. Director of Noranda, Inc., 181 Bay Street,
Suite 4100, 755 BCE Place, Toronto, Ontario M5J 2T3, Canada
since January 1998.
Steven A. Denning, 51 Director of Thomson since January, 2000. Mr. Denning is
General Atlantic Partners currently a Managing Partner of General Atlantic Partners, a
Pickwick Plaza private investment company. Prior to joining General
Greenwich, CT 06830 Atlantic, Mr. Denning was a consultant with McKinsey & Co.
USA Mr. Denning is also a director of Exult, Inc. and GT
Interactive Software Corporation. Member, Board of Trustees,
of Georgia Tech. Director of New York Nature Conservancy.
Director of Cancer Research Institute. Director of National
Parks & Conservation Association. Director of Stanford
Graduate School of Business Advisory Council. Director of
Xchanging. Director of Metapath Software Int'l. Director of
Eclipsys Corporation. Director of Talus Solutions. Director
of EXE Technologies.
John F. Fraser, 69 Director of Thomson since June 1989. Chairman of Air Canada,
Air Canada 355 Portage Avenue, Room 500, Winnipeg, Manitoba R3B 2C3,
Suite 500 Canada since August 1996. Director of Air Canada since 1989.
355 Portgage Avenue Vice Chairman of Russel Metals, Inc. ("Russel"), 1900
Winnipeg, Manitoba R3B 2C3 Minnesota Court, Suite 210, Mississauga, Ontario L5N 3C9
Canada Canada, from May, 1995 to May 1997. Chairman of Russel from
May 1992 to May 1995. Chairman and Chief Executive Officer
of Russel from May 1991 to May 1992. President and Chief
Executive Officer of Russel from May 1978 to May 1991.
Director, Bank of Montreal, First Bank Tower, First Canadian
Place, Toronto, Ontario M5X1A1, Canada, since January 1985.
Director, Manitoba Telecom, Services, Inc., 21(st) Floor,
333 Main Street, Winnipeg, Manitoba R3C 3V6, since May 1997.
Director, Shell Canada Limited, 400-4th Avenue S.W.,
Calgary, Alberta T2P 0J4, Canada, since April 1990.
</TABLE>
I-3
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS HELD
NAME, AGE AND DURING THE PAST FIVE YEARS AND
CURRENT BUSINESS ADDRESS BUSINESS ADDRESSES THEREOF
------------------------------------------------ ------------------------------------------------------------
<S> <C>
Richard J. Harrington, 53 Director of Thomson since September 1993. President and CEO
The Thomson Corporation of Thomson since October 1997. Executive Vice-President of
Metro Center Thomson September 1993 to October 1997. President and Chief
One Station Place Executive Officer, Thomson Newspapers Group, Metro Center,
Stamford, CT 06902 One Station Place, Stamford, Connecticut 06902, July 1993 to
USA October 1997. President and Chief Executive Officer, Thomson
Professional Publishing, Metro Center, One Station Place,
Stamford, Connecticut 06902, from June 1989 to July 1993.
Roger L. Martin, 43 Director of Thomson since September, 1999. Dean of the
Rotman School of Management Joseph L. Rotman School of Management at the University of
105 St. George Street Toronto. Previously a director of Monitor Company from
Toronto, Ontario M5S 3E6 January, 1996 to September, 1998. Co-head of the Monitor
Canada Company in 1995 and 1996. Director of Celestica Inc., 844
Don Mills Rd., Toronto, Ontario, since July 1998.
Vance K. Opperman, 54 Director of Thomson since September 1996. President and CEO
Key Investments Inc. of Key Investments Inc., 601 Second Avenue South, Suite
601 Second Avenue South 5200, Minneapolis, MN 55402, since August 1996. Director;
Suite 5200 Chief Executive Officer and General Counsel, MSP
Minneapolis, MN 55402 Communications, Inc. (magazine publisher) since December
USA 1996. President and Chief Operating Officer of West
Publishing Company ("West") between 1993 and 1996. General
Counsel of West prior to 1993. Served on West's Board of
Directors from 1992 to 1996.
David H. Shaffer, 57 Director of Thomson since August 6, 1998. Chief Operating
The Thomson Corporation Officer of Thomson. Executive Vice President of Thomson
Metro Center since May, 1998. Chairman of the Board and Chief Executive
One Station Place Officer of Jostens Learning Corporation from July, 1995 to
Stamford, CT 06902 April, 1998, President of Dun & Bradstreet's Official
USA Airline Guides, Inc. (OAG) and Vice Chairman of Thomas Cook
Travel Inc. President and Chief Executive Officer of
MacMillan Inc., and Chairman of OAG. Member of Maxwell
Communications Corporation PLC (MCC) board of directors.
Currently chairman of the board of T&S Incorporated. Board
member and publisher of The Black Book Group. Member of the
Advisory Board of Kellogg Graduate School of Management at
Northwestern University, and trustee of the La Jolla Country
Day School.
David K.R. Thomson, 42 Director of Thomson since April 1988. Deputy Chairman of
The Woodbridge Company Limited Woodbridge since June 1990.
65 Queen Street West
Toronto, Ontario M5H 2M8
Canada
</TABLE>
I-4
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS HELD
NAME, AGE AND DURING THE PAST FIVE YEARS AND
CURRENT BUSINESS ADDRESS BUSINESS ADDRESSES THEREOF
------------------------------------------------ ------------------------------------------------------------
<S> <C>
Richard M. Thomson, 66 Director of Thomson since October 1984. Retired Chairman and
Toronto-Dominion Bank Chief Executive Officer of Toronto Dominion Bank ("TDM"),
Toronto-Dominion Bank Tower, 11th Floor 11th Floor, Toronto-Dominion Bank Tower, Toronto, Ontario
Toronto, Ontario M5K 1A2 M5K 1A2, Canada since February 1998. Chairman and Chief
Canada Executive Officer of TDM from May 1978 to February 1998.
Chief Executive Officer of TDM from 1978 to 1997. Director
of Canada Pension Plan Investment Board, Toronto. Chairman
of Canadian Occidental Petroleum Ltd, Calgary. Director of
CGC Inc., Toronto. Director of INCO Limited, Toronto.
Director of S.C. Johnson & Son Inc., Racine, Wisconsin.
Director of Ontario Power Generation Inc., Toronto. Director
of The Prudential Insurance Company of America, Newark, New
Jersey.
Peter J. Thomson, 34 Director of Thomson since January 1995. Deputy Chairman of
The Woodbridge Company Limited Woodbridge since February 1995.
65 Queen Street West
Toronto, Ontario M5H 2M8
Canada
David J. Hulland, 49 Vice-President, Finance of Thomson since September 1999.
The Thomson Corporation Vice President, Group Controller, of Thomson, May 1993 to
Metro Center September 1999. Group Controller of Thomson from 1977 to May
One Station Place 1993.
Stamford, Connecticut 06902
USA
Martin B. Jones, 48 Vice President of Thomson since May 1993. Group Treasurer of
The Thomson Corporation Thomson since December 1984.
The Quadrangle, First Floor
180 Wardour Street
London WIA 4YG
England
Alan M. Lewis, 62 Treasurer of Thomson since May 1979.
The Thomson Corporation
Toronto Dominion Bank Tower, Suite 2706
P.O. Box 24
Toronto-Dominion Centre
Toronto, Ontario M5K 1A1
Canada
</TABLE>
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<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS HELD
NAME, AGE AND DURING THE PAST FIVE YEARS AND
CURRENT BUSINESS ADDRESS BUSINESS ADDRESSES THEREOF
------------------------------------------------ ------------------------------------------------------------
<S> <C>
Robert D. Daleo, 51 Executive Vice President and Chief Financial Officer of
The Thomson Corporation Thomson since May, 1999. Executive Vice-President, Finance
Metro Center and Business Development of Thomson from November 1997 to
One Station Place May 1999. Senior Vice President, Finance and Business
Stamford, CT 06902 Development of Thomson from January 1997 to October 1997.
USA Senior Vice President and Chief Operating Officer, Thomson
Newspapers, One Station Place, Metro Center, Stamford, CT
06902, from January 1996 to December 1997. Senior Vice
President and Chief Financial Officer, Thomson Newspapers,
from December 1994 to December 1995. Senior Vice President
and General Manager, Sweets Group, McGraw-Hill Company, 1221
Avenue of the Americas, New York, New York 10020, until
November 1994.
Michael S. Harris, 50 Senior Vice President, General Counsel and Secretary of
The Thomson Corporation Thomson since May, 1998. Vice President and General Counsel
Metro Center of Thomson Holdings, Inc. ("THI"), Metro Center, One Station
One Station Place Place, Stamford, CT 06902, since June 1993. Assistant
Stamford, CT 06902 Secretary and Assistant General Counsel of THI from May 1989
USA to June 1993. Vice President, Secretary and Director of
Purchaser since May, 2000.
Robert Christie, 46 Executive Vice President of Thomson since March 2000. Senior
Thomson Learning Vice President of Thomson from October 1998 to March 2000.
290 Harbor Drive President and Chief Officer of Thomson Learning Group since
Stamford, CT 06902 February, 1998. President and Chief Executive Officer of
USA Thomson & Thomson, 500 Victory Road, North Quincy, MA, from
November 1996 to February 1998. President of Higher
Education Division, McGraw Hill Company, from August, 1994
to October, 1996.
Stuart M. Garner, 55 Senior Vice President of Thomson since October 1998.
Thomson Newspapers Inc. President and Chief Executive Officer of Thomson Newspapers
2 Harbor Drive Inc. since May, 1997.
Stamford, CT 06902
USA
Brian H. Hall, 52 Executive Vice President of Thomson since March 2000. Senior
Thomson Legal and Regulatory Vice President of Thomson from October 1998 to March 2000.
610 Opperman Drive President and Chief Executive Officer of West Group from
Eagan, MN 55123 1996 to February 1999. President and Chief Executive Officer
USA of Thomson Legal and Regulatory Group since February, 1999.
Formerly President and Chief Executive Officer of Thomson
Legal Publishing from 1995 to 1996.
</TABLE>
I-6
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS HELD
NAME, AGE AND DURING THE PAST FIVE YEARS AND
CURRENT BUSINESS ADDRESS BUSINESS ADDRESSES THEREOF
------------------------------------------------ ------------------------------------------------------------
<S> <C>
Patrick J. Tierney, 54 Executive Vice President of Thomson since March 2000. Senior
Thomson Financial Vice President of Thomson from October 1998 to March 2000.
Metro Center President and Chief Executive Officer of Thomson Financial
One Station Place since November 1999. President and Chief Executive Officer
Stamford, CT 069402 of Thomson's Reference, Scientific, and Healthcare Group
USA from January 1997 to November 1999. Prior to joining
Thomson, President and Chief Executive Officer of Knight
Ridder Financial. President and Treasurer of Purchaser since
May, 2000.
Ronald H. Schlosser, 51 Executive Vice President of Thomson since March 2000.
Thomson Scientific, Reference & Healthcare President and Chief Executive Officer of Thomson's
Metro Center Reference, Scientific and Healthcare Group since January
One Station Place 2000. President of Thomson Financial Publishing Group August
Stamford, CT 06902 1995 to December 1999.
USA
Theron S. Hoffman, 53 Executive Vice President, Human Resources of Thomson since
The Thomson Corporation May, 1998. Senior Vice-President of Human Resources and
Metro Center Services for General Reinsurance Corporation from 1991 to
One Station Place April 1998. Trustee of the Yale-China Association.
Stamford, CT 06902
USA
John Kechejian, 53 Vice President, Investor Relations of Thomson since June
The Thomson Corporation 1997. Vice President, Investor Relations of Asea Brown
Metro Center Boveri from September 1971 to June 1997.
One Station Place
Stamford, CT 06902
USA
Joseph J. G. M. Vermeer, 54 Vice President, Director of Taxes of Thomson since January
The Thomson Corporation 1995. Partner in Peat Marwick Thorne, 40 King Street West,
Metro Center Toronto, Ontario, Canada from 1977 to December 31, 1994.
One Station Place
Stamford, CT 06902
USA
Janey Loyd, 47 Vice President, Corporate Communications of Thomson since
The Thomson Corporation May 2000, Director of Corporate Communications of Thomson
Metro Center from October 1999 to May 2000. Vice President, Marketing
One Station Place Communications of LAI Worldwide from January 1998 to
Stamford, CT 06902 September 1999. Vice President, Business Development and
USA Communications of TAM Brands Inc. from 1991 to September
1999.
</TABLE>
2. DIRECTORS AND EXECUTIVE OFFICERS OF PURCHASER. The following table sets
forth the name, age, current business address, citizenship and present principal
occupation or employment, and material occupations, positions, offices or
employments and business addresses thereof for the past five years of
I-7
<PAGE>
each director and executive officer of Purchaser. All directors and officers are
citizens of the United States. Unless otherwise indicated, the current business
address of each person is Marquee Acquisition Corporation, Metro Center, One
Station Place, Stamford, Connecticut 06902. Each occupation set forth opposite
an individual's name refers to employment with Purchaser, unless otherwise
noted.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS HELD
NAME, AGE AND DURING THE PAST FIVE YEARS AND
CURRENT BUSINESS ADDRESS BUSINESS ADDRESSES THEREOF
------------------------------------------ --------------------------------------------------------
<S> <C>
Patrick J. Tierney, 54 President and Treasurer of Purchaser since May, 2000.
Thomson Financial Executive Vice President of Thomson since March 2000.
Metro Center Senior Vice President of Thomson from October 1998 to
One Station Place March 2000. President and Chief Executive Officer of
Stamford, CT 06902 Thomson Financial since November 1999. President and
USA Chief Executive Officer of Thomson's Reference,
Scientific, and Healthcare Group from January 1997 to
November 1999. Prior to joining Thomson, President and
Chief Executive Office of Knight Ridder Financial.
Michael S. Harris, 50 Vice President, Secretary and Director of Purchaser
The Thomson Corporation since May, 2000. Senior Vice President, General Counsel
Metro Center and Secretary of Thomson since May, 1998. Vice President
One Station Place and General Counsel of Thomson Holdings, Inc. ("THI"),
Stamford, CT 06902 Metro Center, One Station Place, Stamford, CT 06902,
USA since June 1993. Assistant Secretary and Assistant
General Counsel of THI from May 1989 to June 1993.
</TABLE>
I-8
<PAGE>
The Information Agent for the Offer is:
[LOGO]
501 Madison Avenue, 20th Floor
New York, New York 10022
BANKS AND BROKERS CALL COLLECT: (212) 750-5833
ALL OTHERS CALL TOLL FREE: (888) 750-5834
THE DEALER MANAGER FOR THE OFFER IS:
MORGAN STANLEY DEAN WITTER
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
(212) 761-6051
