Exhibit 1
STOCKHOLDER VOTING AGREEMENT
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STOCKHOLDER VOTING AGREEMENT, dated as of July 12, 2000 (this
"Agreement"), among General Electric Company, a New York corporation ("Parent"),
GECS Holdings, Inc., a Delaware corporation ("GECS Holdings"), General Electric
Capital Services, Inc. ("GECS"), a Delaware corporation, and General Electric
Capital Corporation, a New York corporation ("Capital" and, together with GECS
Holdings, the "Stockholder", which term shall include Parent and any subsidiary
of Parent to the extent Subject Shares (as defined below) are held by Parent or
such subsidiary), and UBS AG, an Aktiengesellschaft organized under the laws of
Switzerland ("UBS").
WHEREAS, Paine Webber Group, Inc. a Delaware corporation (the
"Company"), UBS and Neptune Merger Subsidiary, Inc., a Delaware corporation and
a wholly owned subsidiary of UBS ("Merger Subsidiary"), are contemporaneously
herewith entering into an Agreement and Plan of Merger, dated the date hereof
(the "Merger Agreement"), which provides, among other things, for the merger of
the Company with and into Merger Subsidiary (the "Merger");
WHEREAS, as a condition and inducement to their willingness to
enter into the Merger Agreement, UBS and Merger Subsidiary have requested that
Stockholder make certain agreements with respect to 31,523,600 shares of common
stock, par value $1.00 per share, having one vote per share ("Shares"), of the
Company owned of record and beneficially by the Stockholder (such Shares,
together with any additional securities of the Company described in Section 4,
being referred to herein as the "Subject Shares"), upon the terms and subject to
the conditions hereof; and
WHEREAS, in order to induce UBS and Merger Subsidiary to enter
into the Merger Agreement, Stockholder is willing to make certain agreements
with respect to the Subject Shares;
NOW, THEREFORE, in consideration of the premises and the
mutual covenants and agreements set forth herein, the parties hereto agree as
follows:
1. Voting Agreements. For so long as this Agreement is in
effect, at any meeting of stockholders of the Company, however called, including
any adjourned or postponed meeting, and in any action by consent of the
stockholders of the Company or in any other circumstances upon which a vote,
consent or other approval is sought, Stockholder shall vote (or cause to be
voted), or, if applicable, give consent or approval with respect to, all of the
Subject Shares that Stockholder has the right to vote in favor of adoption of
the Merger Agreement and approval of the Merger and any other transaction
contemplated by the Merger Agreement. Any such vote shall be cast or consent
shall be given for purposes of this Section 1 in accordance with such procedures
relating thereto as shall ensure that it is duly counted for purposes of
determining that a quorum is present and for purposes of recording in accordance
herewith the results of such vote or consent.
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2. Covenants. From and after the date of this Agreement,
Stockholder agrees not to, and to use best efforts to cause any investment
banker, attorney or other adviser or representative of Stockholder not to, (i)
sell, transfer, exchange, pledge, assign, hypothecate, encumber, tender or
otherwise dispose of, or enter into any contract, option or other arrangement
with respect to the sale, transfer, exchange, pledge, assignment, hypothecation,
encumbrance, tender or other disposition of the Subject Shares, except that
Stockholder may transfer Subject Shares to any subsidiary of Parent; provided,
that such transferee has agreed to be bound by the terms of this Agreement; (ii)
exchange or convert Subject Shares for or into shares of non-voting common
stock, par value $1.00 per share, of the Company prior to the time the
stockholders of the Company have voted on the Merger; (iii) grant any proxies
with respect to any Subject Shares, deposit any such Subject Shares into a
voting trust or enter into a voting or option agreement with respect to any of
such Subject Shares; (iv) directly or indirectly, solicit or encourage inquiries
or proposals with respect to, or engage in any negotiations concerning, or
provide any confidential information to, or have any discussions with, any
person relating to, an Acquisition Proposal; or (v) take any action which would
make any representation or warranty of Stockholder herein untrue or incorrect or
prevent, burden or materially delay the consummation of the transactions
contemplated by this Agreement. As used in this Agreement, "person" shall have
the meaning specified in Sections 3(a)(9) and 13(d)(3) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act").
3. Representations and Warranties of Stockholder. Stockholder
represents and warrants to UBS that:
(a) Capacity; No Violations. Stockholder has the necessary
authority to enter into this Agreement and to consummate the transactions
contemplated hereby. This Agreement has been duly executed and delivered by
Stockholder, and constitutes a valid and binding agreement of Stockholder
enforceable against Stockholder in accordance with its terms, subject to
bankruptcy, insolvency, reorganization, moratorium and similar laws of general
applicability relating to or affecting creditors' rights and to general equity
principles; and such execution and delivery and performance by Stockholder of
this Agreement will not (i) constitute a breach or violation of, or a default
under, or cause or allow the acceleration or creation of a Lien (with or without
the giving of notice, passage of time or both) pursuant to, any law, rule or
regulation or any judgment, decree, order, governmental or non-governmental
permit or license, or any material contract of Stockholder or to which
Stockholder or its properties is subject or bound, (ii) constitute a breach or
violation of, or a default under, the certificate of incorporation, bylaws or
other organizational documents of Stockholder, or (iii) require any consent or
approval under any such law, rule, regulation, judgment, decree, order,
governmental or non-governmental permit or license or the consent or approval of
any other party to any material contract of Stockholder or to which Stockholder
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or its properties is subject or bound. In this Agreement, "Lien" shall mean any
lien, pledge, security interest, claim, third party right or other encumbrance.
(b) Subject Shares. Stockholder is the record holder of, has
sole voting and dispositive power over, and has good and valid title to, the
Subject Shares free and clear of all Liens (other than any Lien created by this
Agreement) and, except as provided by this Agreement, there are no options or
rights to acquire or proxies, voting trusts or voting agreements relating to the
Subject Shares to which Stockholder is a party, other than the Amended and
Restated Stockholders Agreement between the Company, Kidder, Peabody Group,
Inc., Parent, GECS and Capital, dated August 6, 1997 (as further amended by the
letter agreement, dated the date hereof, between the Company, Parent and joined
in by GECS Holdings on September 8, 1997, the "Company Stockholder Agreement").
Except as otherwise disclosed on Schedule A to this Agreement, as of the date
hereof, the Subject Shares are the only shares of any class of capital stock of
the Company which Stockholder has the right, power or authority (sole or shared)
to sell or vote, and Stockholder does not have any right to acquire, nor is it
the beneficial owner of, any other shares of any class of capital stock of the
Company or any securities convertible into or exchangeable or exercisable for
any shares of any class of capital stock of the Company, other than capital
stock and securities held in any Third Party Account (as defined in the
Stockholders Agreement).
4. Adjustments; Additional Shares. In the event (a) of any
stock dividend, stock split, recapitalization, reclassification, subdivision,
combination or exchange of Shares on, of or affecting the Subject Shares, or (b)
GECS, Capital or GECS Holdings shall become the beneficial owner of any
additional Shares or other securities of the Company, then such Shares held by
Stockholder immediately following the effectiveness of the events described in
clause (a) or Stockholder becoming the beneficial owner of the Shares or other
securities, as described in clause (b), shall become Subject Shares hereunder.
5. Expenses. Each party hereto shall pay its own expenses
incurred in connection with this Agreement.
6. Specific Performance. Stockholder acknowledges and agrees
that if it fails to perform any of its obligations under this Agreement
immediate and irreparable harm or injury would be caused to UBS for which money
damages would not be an adequate remedy. In such event, Stockholder agrees that
UBS shall have the right, in addition to any other rights it may have, to
specific performance of this Agreement. Accordingly, if UBS should institute an
action or proceeding seeking specific enforcement of the provisions hereof,
Stockholder hereby waives the claim or defense that UBS has an adequate remedy
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at law and hereby agrees not to assert in any such action or proceeding the
claim or defense that such a remedy at law exists.
7. Notices. All notices or other communications under this
Agreement shall be in writing and shall be deemed duly given, effective (i)
three business days later, if sent by registered or certified mail, return
receipt requested, postage prepaid, (ii) when sent, if sent by facsimile,
provided that the facsimile is promptly confirmed by telephone confirmation
thereof, (iii) when served, if delivered personally to the intended recipient,
and (iv) one business day later, if sent by overnight delivery via a national
courier service, and in each case, addressed to the intended recipient at the
address set forth in the preamble hereof. Any party may change the address to
which notices or other communications hereunder are to be delivered by giving
the other party notice in the manner herein set forth:
If to UBS:
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Bahnhofstrasse 45
Zurich, Switzerland
Attention: Luqman Arnold
Phone: 41-1-234-5801
Fax: 41-1-234-3700
With a copy to:
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Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Attention: James C. Morphy, Esq.
Phone: (212) 558-4000
Fax: (212) 558-3588
If to Stockholder:
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General Electric Company
3135 Easton Turnpike
Fairfield, CT 06431
Attention: Pamela Daley, Esq.
Senior Counsel for Transactions
Phone: (203) 373-2211
Fax: (203) 373-3008
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With a copy to:
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General Electric Capital Services, Inc.
260 Long Ridge Road
Stamford, CT 06527
Attention: General Counsel
Fax: (203) 357-3365
8. Parties in Interest. This Agreement shall inure to the
benefit of and be binding upon the parties named herein and their respective
successors and assigns; provided, however, that such successor in interest or
assigns shall agree to be bound by the provisions of this Agreement. Nothing in
this Agreement, express or implied, is intended to confer upon any Person other
than UBS, Stockholder or their successors or assigns, any rights or remedies
under or by reason of this Agreement.
9. Entire Agreement; Amendments. This Agreement contains the
entire agreement between Stockholder and UBS with respect to the subject matter
hereof and supersedes all prior and contemporaneous agreements and
understandings, oral or written, with respect to such transactions. This
Agreement may not be changed, amended or modified orally, but may be changed
only by an agreement in writing signed by the party against whom any waiver,
change, amendment, modification or discharge may be sought.
10. Assignment. No party to this Agreement may assign any of
its rights or obligations under this Agreement without the prior written consent
of the other party hereto, except that UBS may assign its rights and obligations
hereunder to any of its direct or indirect wholly owned subsidiaries (including
Merger Subsidiary).
11. Cooperation. If any notices, approvals or filings are
required with any regulatory commission or agency in order to allow the parties
hereto to effectively carry out the transactions contemplated by this Agreement,
Stockholder and UBS shall cooperate in making such notices or filings or in
obtaining such approvals.
12. Headings. The section headings herein are for convenience
only and shall not affect the construction of this Agreement.
13. Counterparts. This Agreement may be executed in any number
of counterparts, each of which, when executed, shall be deemed to be an original
and all of which together shall constitute one and the same document.
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14. Governing Law. This Agreement shall be governed by and
construed in accordance with the laws of the State of Delaware (regardless of
the laws that might otherwise govern under applicable Delaware principles of
conflicts of law).
15. Severability. The provisions of this Agreement shall be
deemed severable and the invalidity or unenforceability of any provision shall
not affect the validity or enforceability or the other provisions hereof. If any
provision of this Agreement, or the application thereof to any person or any
circumstance, is invalid or unenforceable, (a) a suitable and equitable
provision shall be substituted therefor in order to carry out, so far as may be
valid and enforceable, the intent and purpose of such invalid or unenforceable
provision and (b) the remainder of this Agreement and the application of such
provision to other persons or circumstances shall not be affected by such
invalidity or unenforceability, nor shall such invalidity or unenforceability
affect the validity or enforceability of such provision, or the application
thereof, in any other jurisdiction.
16. Termination. The provisions of this Agreement shall
terminate at the earlier of (i) the Effective Time (as defined in the Merger
Agreement) and (ii) the termination of the Merger Agreement in accordance with
its terms.
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IN WITNESS WHEREOF, Parent, Stockholder and UBS have caused
this Agreement to be duly executed and delivered on the day and year first above
written.
General Electric Company
By: __________________________
Name:
Title:
GECS Holdings, Inc.
By: __________________________
Name:
Title:
General Electric Capital Corporation
By: __________________________
Name:
Title:
UBS AG
By: __________________________
Name:
Title:
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Schedule A
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Name Number of Shares*
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General Electric Capital Corporation 8,273,600
GECS Holdings, Inc. 23,250,000
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* Excludes 6,500 Shares held in two pension trusts in respect of which GE
(through subsidiaries) acts as fiduciary.
