<PAGE>
As filed with the Securities and Exchange Commission on March 20, 2000.
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- -------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
SCHEDULE TO
(Rule 14d-100)
Tender Offer Statement Under Section 14(d)(1)
or Section 13(e)(1) of the Securities Exchange Act of 1934
CORDANT TECHNOLOGIES INC.
(Name of Subject Company (Issuer))
OMEGA ACQUISITION CORP.
a wholly owned subsidiary of
ALCOA INC.
(Names of Filing Persons (Offerors))
----------------
COMMON STOCK, PAR VALUE $1.00 PER SHARE
(Including the Associated Rights to Purchase Preferred Stock)
(Title of Class of Securities)
----------------
218412104
(CUSIP Number of Class of Securities)
Lawrence R. Purtell, Esq.
Alcoa Inc.
201 Isabella Street
Pittsburgh, Pennsylvania 15212
Telephone: (412) 553-4545
(Name, address and telephone number of
person authorized to receive notices
and communications on behalf of filing persons)
Copy to:
J. Michael Schell, Esq.
Margaret L. Wolff, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York 10036
Telephone: 212-735-3000
CALCULATION OF FILING FEE
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- -------------------------------------------------------------------------------
Transaction Valuation* Amount of Filing Fee
$2,092,745,367 $418,549.07
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* For purposes of calculating amount of filing fee only. This amount assumes
the purchase of 36,714,831 shares of common stock of Cordant Technologies
Inc. at the offer price of $57.00 per share. The amount of the filing fee,
calculated in accordance with Rule 0-11 of the Securities Exchange Act of
1934, as amended, equals 1/50 of 1% of the transaction value.
[_]Check the box if any part of the fee is offset as provided by Rule 0-
11(a)(2) and identify the filing with which the offsetting fee was
previously paid. Identify the previous filing by registration statement
number or the Form or Schedule and the date of its filing.
Amount Previously Paid: N/A Form or Registration No.: N/A
Filing party: N/A Date Filed: N/A
[_]Check the box if the filing relates solely to preliminary communications
made before the commencement of a tender offer.
Check the appropriate boxes below to designate any transactions to which the
statement relates:
[X] third-party tender offer subject to Rule 14d-1.
[_] issuer tender offer subject to Rule 13e-4.
[_] going-private transaction subject to Rule 13e-3.
[_] amendment to Schedule 13D under Rule 13d-2.
Check the following box if the filing is a final amendment reporting the
results of the tender offer: [_]
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<PAGE>
Item 1. Summary Term Sheet.
The information set forth in the section of the Offer to Purchase entitled
"Summary Term Sheet" is incorporated herein by reference.
Item 2. Subject Company Information.
(a) The name of the subject company is Cordant Technologies Inc., a Delaware
corporation (the "Company"), and the address of its principal executive
offices is 15 W. South Temple, Suite 1600, Salt Lake City, Utah 84101. Its
telephone number is (801) 933-4000.
(b) This Statement relates to the offer by Omega Acquisition Corp. (the
"Purchaser"), a Delaware corporation and a wholly owned subsidiary of Alcoa
Inc., a Pennsylvania corporation ("Alcoa"), to purchase all outstanding shares
of common stock of the Company, par value $1.00 per share, including the
associated rights to purchase preferred stock (collectively, the "Shares"), at
a price of $57.00 per Share, net to the seller in cash, upon the terms and
subject to the conditions set forth in the Offer to Purchase and in the
related Letter of Transmittal, copies of which are attached hereto as Exhibits
(a)(l) and (a)(2) (which are herein collectively referred to as the "Offer").
The information set forth in the introduction to the Offer to Purchase (the
"Introduction") is incorporated herein by reference.
(c) The information concerning the principal market in which the Shares are
traded and certain high and low sales prices for the Shares in such principal
market is set forth in Section 6--"Price Range of Shares; Dividends" in the
Offer to Purchase and is incorporated herein by reference.
Item 3. Identity and Background of the Filing Person.
(a), (b), (c) The information set forth in Section 8--"Certain Information
Concerning Alcoa and the Purchaser" and Schedule I in the Offer to Purchase is
incorporated herein by reference.
Item 4. Terms of the Transaction.
(a)(1)(i)-(viii), (xii) The information set forth under "Introduction",
Section 10--"Background of the Offer; Past Contacts or Negotiations with the
Company", Section 12--"Purpose of the Offer; Plans for the Company", Section
11--"The Merger Agreement; Other Arrangements", Section 7--"Certain
Information Concerning the Company", Section 13--"Certain Effects of the
Offer" and Section 9--"Source and Amount of Funds" in the Offer to Purchase is
incorporated herein by reference.
(a)(1) (ix) Not applicable
(x) Not applicable
(xi) Not applicable
(a)(2) Not applicable
Item 5. Past Contacts, Transactions, Negotiations and Agreements.
The information set forth in Section 10--"Background of the Offer; Past
Contacts or Negotiations with the Company", Section 11--"The Merger Agreement;
Other Arrangements", Section 8--"Certain Information Concerning Alcoa and the
Purchaser" and Section 12--"Purpose of the Offer; Plans for the Company" in
the Offer to Purchase is incorporated herein by reference.
Item 6. Purpose of the Tender Offer and Plans or Proposals.
(a), (c)(1), (4-7) The information set forth in "Introduction," Section 11--
"The Merger Agreement; Other Arrangements," Section 12--"Purpose of the Offer;
Plans for the Company," and Section 14--"Dividends and Distributions" in the
Offer to Purchase is incorporated herein by reference.
(c)(2) None
(3) None
2
<PAGE>
Item 7. Source and Amount of Funds or Other Consideration.
(a) The information set forth in Section 9--"Source and Amount of Funds" in
the Offer to Purchase is incorporated herein by reference.
(b) Not applicable
(d) Not applicable
Item 8. Interest in Securities of the Subject Company.
The information set forth in "Introduction", Section 7--"Certain Information
Concerning the Company", Section 8--"Certain Information Concerning Alcoa and
the Purchaser" and Schedule I in the Offer to Purchase is incorporated herein
by reference.
Item 9. Persons/Assets, Retained, Employed, Compensated or Used.
The information set forth in "Introduction" and Section 18--"Fees and
Expenses" of the Offer to Purchase is incorporated herein by reference.
Item 10. Financial Statements.
Not applicable
Item 11. Additional Information.
Not applicable
Item 12. Exhibits.
(a)(1) Offer to Purchase dated March 20, 2000.
(a)(2) Letter of Transmittal.
(a)(3) Notice of Guaranteed Delivery.
(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and
Other Nominees.
(a)(5) Letter to Clients for use by Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees.
(a)(6) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9.
(a)(7) Joint Press Release issued by Alcoa and the Company on March 14,
2000, incorporated herein by reference to the Schedule TO filed by the parties
on March 14, 2000.
(a)(8) Summary Advertisement as published in The Wall Street Journal on
March 20, 2000.
(b) Not applicable
(d)(1) Agreement and Plan of Merger, dated as of March 14, 2000, among
Alcoa, the Purchaser and the Company.
(d)(2) Amendment, dated March 13, 2000, to the Corporate Agreement between
Howmet International Inc., Cordant Technologies Holding Company and Cordant
Technologies Inc., incorporated herein by reference to Amendment No. 2 to the
Schedule 13D filed by Cordant Technologies Inc. on March 15, 2000.
(d)(3) Letter Agreement, dated March 13, 2000, between Alcoa Inc. and Howmet
International Inc.
(g) Not applicable
(h) Not applicable
3
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this statement is true, complete and correct.
Omega Acquisition Corp.
/s/Barbara S. Jeremiah
By: _________________________________
Name: Barbara S. Jeremiah
Title: Vice President
Alcoa Inc.
/s/Richard B. Kelson
By: _________________________________
Name: Richard B. Kelson
Title: Executive Vice President and
Chief Financial Officer
Dated: March 20, 2000
4
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit No. Exhibit Name Page Number
----------- ------------ -----------
<C> <S> <C>
(a)(1) Offer to Purchase dated March 20, 2000 ..............
(a)(2) Letter of Transmittal ...............................
(a)(3) Notice of Guaranteed Delivery .......................
(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees ........................
(a)(5) Letter to Clients for use by Brokers, Dealers,
Commercial Banks, Trust Companies and Other Nominees
.....................................................
(a)(6) Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 ........
(a)(8) Summary Advertisement as published in The Wall Street
Journal on
March 20, 2000 ......................................
(d)(1) Agreement and Plan of Merger, dated as of March 14,
2000, among Alcoa, the Purchaser and the Company ....
(d)(3) Letter Agreement, dated March 13, 2000, between Alcoa
Inc. and Howmet International Inc. ..................
</TABLE>
<PAGE>
Offer To Purchase For Cash
All Outstanding Shares of Common Stock
(Including the Associated Rights to Purchase Preferred Stock)
of
Cordant Technologies Inc.
at
$57.00 Net Per Share
by
Omega Acquisition Corp.
a wholly owned subsidiary of
Alcoa Inc.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON MONDAY, APRIL 24, 2000, UNLESS THE OFFER IS EXTENDED.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (I) THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER OF
SHARES OF COMMON STOCK, PAR VALUE $1.00 PER SHARE, OF CORDANT TECHNOLOGIES
INC. (THE "COMPANY"), INCLUDING THE ASSOCIATED RIGHTS TO PURCHASE PREFERRED
STOCK (COLLECTIVELY, THE "SHARES"), THAT REPRESENTS AT LEAST A MAJORITY OF THE
THEN OUTSTANDING SHARES ON A FULLY DILUTED BASIS AND (II) THE WAITING PERIOD
UNDER THE HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT OF 1976, AS AMENDED,
AND THE REGULATIONS THEREUNDER HAVING EXPIRED OR BEEN TERMINATED. THE OFFER IS
ALSO SUBJECT TO OTHER CONDITIONS. SEE SECTION 15.
THE OFFER IS BEING MADE IN CONNECTION WITH THE AGREEMENT AND PLAN OF MERGER,
DATED AS OF MARCH 14, 2000 (THE "MERGER AGREEMENT"), AMONG ALCOA INC.
("ALCOA"), OMEGA ACQUISITION CORP. (THE "PURCHASER") AND THE COMPANY. THE
BOARD OF DIRECTORS OF THE COMPANY (I) DETERMINED THAT THE TERMS OF THE OFFER
AND THE MERGER DESCRIBED HEREIN ARE FAIR TO AND IN THE BEST INTERESTS OF THE
STOCKHOLDERS OF THE COMPANY, (II) APPROVED THE MERGER AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE OFFER AND THE MERGER AND
(III) UNANIMOUSLY RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS ACCEPT THE OFFER
AND TENDER THEIR SHARES PURSUANT TO THE OFFER AND APPROVE AND ADOPT THE MERGER
AGREEMENT.
IMPORTANT
Any stockholder of the Company wishing to tender Shares in the Offer must
(1) complete and sign the Letter of Transmittal (or a facsimile thereof) in
accordance with the instructions in the Letter of Transmittal and mail or
deliver the Letter of Transmittal and all other required documents to the
Depositary (as defined herein) together with certificates representing the
Shares tendered or follow the procedure for book-entry transfer set forth in
Section 3 or (2) request such stockholder's broker, dealer, commercial bank,
trust company or other nominee to effect the transaction for the stockholder.
A stockholder whose Shares are registered in the name of a broker, dealer,
commercial bank, trust company or other nominee must contact such person if
such stockholder wishes to tender such Shares.
Rights are presently evidenced by the certificates for the shares of common
stock of the Company and a tender by a stockholder of such stockholder's
shares of common stock of the Company will also constitute a tender of the
associated rights to purchase preferred stock. Any stockholder of the Company
who wishes to tender Shares and cannot deliver certificates representing such
Shares and all other required documents to the Depositary on or prior to the
Expiration Date (as defined herein) or who cannot comply with the procedures
for book-entry transfer on a timely basis may tender such Shares pursuant to
the guaranteed delivery procedure set forth in Section 3.
Questions and requests for assistance may be directed to the Information
Agent or the Dealer Manager at their respective addresses and telephone
numbers set forth on the back cover of this Offer to Purchase. Additional
copies of this Offer to Purchase, the Letter of Transmittal, the Notice of
Guaranteed Delivery and other related materials may be obtained from the
Information Agent or the Dealer Manager. Stockholders may also contact their
broker, dealer, commercial bank, trust company or other nominee for copies of
these documents.
The Dealer Manager for the Offer is:
Salomon Smith Barney
March 20, 2000
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
<S> <C>
SUMMARY TERM SHEET........................................................ 1
INTRODUCTION.............................................................. 5
THE TENDER OFFER.......................................................... 7
1.Terms of the Offer.................................................... 7
2.Acceptance for Payment and Payment for Shares......................... 9
3.Procedures for Accepting the Offer and Tendering Shares............... 9
4.Withdrawal Rights..................................................... 12
5.Certain United States Federal Income Tax Consequences ................ 13
6.Price Range of Shares; Dividends...................................... 14
7.Certain Information Concerning the Company............................ 14
8.Certain Information Concerning Alcoa and the Purchaser................ 17
9.Source and Amount of Funds............................................ 18
10.Background of the Offer; Past Contacts or Negotiations with the
Company................................................................ 18
11.The Merger Agreement, Other Arrangements............................. 20
12.Purpose of the Offer; Plans for the Company.......................... 29
13.Certain Effects of the Offer......................................... 30
14.Dividends and Distributions.......................................... 31
15.Certain Conditions of the Offer...................................... 32
16.Certain Legal Matters; Regulatory Approvals.......................... 33
17.Dissenters' Rights................................................... 36
18.Fees and Expenses.................................................... 36
19.Miscellaneous........................................................ 37
SCHEDULE I
Directors and Executive Officers of Alcoa and the Purchaser............. I-1
</TABLE>
i
<PAGE>
SUMMARY TERM SHEET
Omega Acquisition Corp. is offering to purchase all of the outstanding
common stock of Cordant Technologies Inc. for $57.00 per share in cash. The
following are some of the questions you, as a stockholder of Cordant, may have
and answers to those questions. We urge you to read carefully the remainder of
this Offer to Purchase and the Letter of Transmittal because the information
in this summary term sheet is not complete. Additional important information
is contained in the remainder of this Offer to Purchase and the Letter of
Transmittal.
WHO IS OFFERING TO BUY MY SECURITIES?
Our name is Omega Acquisition Corp. We are a Delaware corporation formed for
the purpose of making a tender offer for all of the common stock of Cordant
and have carried on no activities other than in connection with the merger
agreement among Alcoa Inc., Omega Acquisition Corp. and Cordant. We are a
wholly owned subsidiary of Alcoa, a Pennsylvania corporation. See the
"Introduction" to this Offer to Purchase and Section 8.
WHAT ARE THE CLASSES AND AMOUNTS OF SECURITIES SOUGHT IN THE OFFER?
We are seeking to purchase all of the outstanding common stock of Cordant
and the rights to purchase preferred stock associated with those shares. See
the "Introduction" to this Offer to Purchase and Section 1.
HOW MUCH ARE YOU OFFERING TO PAY? WHAT IS THE FORM OF PAYMENT? WILL I HAVE TO
PAY ANY FEES OR COMMISSIONS?
We are offering to pay $57.00 per share, net to you, in cash. If you are the
record owner of your shares and you tender your shares to us in the offer, you
will not have to pay brokerage fees or similar expenses. If you own your
shares through a broker or other nominee, and your broker tenders your shares
on your behalf, your broker or nominee may charge you a fee for doing so. You
should consult your broker or nominee to determine whether any charges will
apply. See the "Introduction" to this Offer to Purchase.
DO YOU HAVE THE FINANCIAL RESOURCES TO MAKE PAYMENT?
Alcoa, our parent company, will provide us with sufficient funds to purchase
all shares validly tendered and not withdrawn in the offer and to provide
funding for the merger, which is expected to follow the successful completion
of the offer in accordance with the terms and conditions of the merger
agreement. We anticipate that a significant portion of these funds will be
obtained from the existing resources and internally generated funds of Alcoa,
including short-term borrowing in the ordinary course of business. For the
remainder, Alcoa is evaluating a number of financing alternatives with
different maturities in both bank borrowings and the capital markets. See
Section 9.
IS YOUR FINANCIAL CONDITION RELEVANT TO MY DECISION TO TENDER IN THE OFFER?
We do not think our financial condition is relevant to your decision whether
to tender in the offer because the form of payment consists solely of cash.
Alcoa has arranged for a significant portion of our funding to come from its
existing resources and internally generated funds, including short-term
borrowing in the ordinary course of business, and Alcoa will have the
remainder arranged prior to the expiration of the tender offer. See Section 9.
HOW LONG DO I HAVE TO DECIDE WHETHER TO TENDER IN THE OFFER?
You will have at least until 5:00 p.m., New York City time, on Monday, April
24, 2000, to tender your shares in the offer. Further, 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, which is described later
in this Offer to Purchase. See Sections 1 and 3.
1
<PAGE>
CAN THE OFFER BE EXTENDED AND UNDER WHAT CIRCUMSTANCES?
We have agreed in the merger agreement that:
. Without the consent of Cordant, we may extend the offer beyond the
scheduled expiration date if at that date any of the conditions to our
obligation to accept for payment and to pay for the shares are not
satisfied or, to the extent permitted by the merger agreement, waived.
. Without the consent of Cordant, we may generally extend the offer for
any period required by any rule, regulation or interpretation of the
Securities and Exchange Commission applicable to the offer.
. Unless Cordant advises us that it does not wish us to extend the offer,
we will extend the offer from time to time until the earlier of (1) 30
days after the date on which any applicable waiting period under the
Hart-Scott-Rodino Antitrust Improvements Act has expired or terminated,
the notification of and approval by the European Commission under the EU
Council Regulation 4064/89, as amended, has been received and the
applicable waiting period under the Canadian Competition Act has expired
or (2) September 30, 2000, in the event that on such date all of the
conditions to the offer have not been satisfied or waived as permitted
by the merger agreement.
. If all conditions to the offer have been satisfied or waived, we will
accept for payment and pay for all shares validly tendered and not
withdrawn at such time (which shares may not thereafter be withdrawn)
and extend the offer to provide a "subsequent offering period" for at
least three business days, during which time stockholders whose shares
have not been accepted for payment may tender, but not withdraw, their
shares and receive the offer consideration. We are not permitted under
the federal securities laws to provide a subsequent offering period of
more than 20 business days (for all such extensions).
Any extension under the circumstances described in the first and third
bullet points above will not exceed that number of days that we reasonably
believe is necessary to cause the conditions of the offer to be satisfied, but
no more than ten business days.
See Section 1 of this Offer to Purchase for more details on our ability to
extend the offer.
HOW WILL I BE NOTIFIED IF THE OFFER IS EXTENDED?
If we extend the offer, we will inform ChaseMellon Shareholder Services,
L.L.C. (the depositary for the offer) of that fact and will make a public
announcement of the extension not later than 9:00 a.m., New York City time, on
the next business day after the day on which the offer was scheduled to
expire. See Section 1.
WHAT ARE THE MOST SIGNIFICANT CONDITIONS TO THE OFFER?
. We are not obligated to purchase any shares that are validly tendered
unless the number of shares validly tendered and not withdrawn before
the expiration date of the offer represents at least a majority of the
then outstanding shares on a fully diluted basis. We call this condition
the "minimum condition."
. We are not obligated to purchase shares that are validly tendered if,
among other things, there is a material adverse change in Cordant or its
business.
. We are not obligated to purchase shares that are validly tendered if,
among other things, the applicable waiting period under the Hart-Scott-
Rodino Antitrust Improvements Act has not expired or been terminated.
The offer is also subject to a number of other conditions. We can waive some
of the conditions to the offer without Cordant's consent; however, we cannot
waive the minimum condition. See Section 15.
2
<PAGE>
HOW DO I TENDER MY SHARES?
To tender shares, you must deliver the certificates representing your
shares, together with a completed letter of transmittal and any other
documents required by the letter of transmittal, to ChaseMellon Shareholder
Services, the depositary for the offer, not later than the time the tender
offer expires. If your shares are held in street name, the shares can be
tendered by your nominee through The Depository Trust Company. If you are
unable to deliver any required document or instrument to the depositary by the
expiration of the tender offer, you may gain some extra time by having a
broker, a bank or other fiduciary that is an eligible institution guarantee
that the missing items will be received by the depositary within three New
York Stock Exchange trading days. For the tender to be valid, however, the
depositary must receive the missing items within that three trading day
period. See Section 3.
UNTIL WHAT TIME MAY I WITHDRAW PREVIOUSLY TENDERED SHARES?
You may withdraw shares at any time until the offer has expired and, if we
have not accepted your shares for payment by Thursday, May 18, 2000, you may
withdraw them at any time after that date until we accept shares for payment.
This right to withdraw will not apply to the subsequent offering period
discussed in Section 1. See Section 4.
HOW DO I WITHDRAW PREVIOUSLY TENDERED SHARES?
To withdraw shares, you must deliver a written notice of withdrawal, or a
facsimile of one, with the required information to the depositary while you
still have the right to withdraw the shares. See Section 4.
WHAT DOES THE CORDANT BOARD OF DIRECTORS RECOMMEND REGARDING THE OFFER?
We are making the offer pursuant to the merger agreement, which has been
approved by the Cordant board of directors. The board of directors of Cordant
(1) determined that the terms of the offer and the merger are fair to and in
the best interests of the stockholders of Cordant, (2) approved the merger
agreement and the transactions contemplated thereby, including the offer and
the merger and (3) unanimously recommends that Cordant's stockholders accept
the offer and tender their shares pursuant to the offer and approve and adopt
the merger agreement. See the "Introduction" to this Offer to Purchase.
IF A MAJORITY OF THE SHARES ARE TENDERED AND ACCEPTED FOR PAYMENT, WILL
CORDANT CONTINUE AS A PUBLIC COMPANY?
No. Following the purchase of shares in the offer we expect to consummate
the merger. If the merger takes place, Cordant no longer will be publicly
owned. Even if for some reason the merger does not take place, if we purchase
all of the tendered shares, there may be so few remaining stockholders and
publicly held shares that Cordant common stock will no longer be eligible to
be traded through the New York Stock Exchange; there may not be a public
trading market for Cordant common stock; and Cordant may cease making filings
with the Securities and Exchange Commission or otherwise cease being required
to comply with the SEC rules relating to publicly held companies. See Section
13.
WILL THE TENDER OFFER BE FOLLOWED BY A MERGER IF ALL OF THE CORDANT
TECHNOLOGIES INC. SHARES ARE NOT TENDERED IN THE OFFER?
Yes. If we accept for payment and pay for at least a majority of the shares
of Cordant on a fully diluted basis, Omega Acquisition Corp. will be merged
with and into Cordant. If that merger takes place, Alcoa will own all of the
shares of Cordant and all remaining stockholders of Cordant (other than Alcoa
Inc. and stockholders properly exercising dissenters' rights) will receive
$57.00 per share in cash (or any higher price per share that is paid in the
offer). See the "Introduction" to this Offer to Purchase.
3
<PAGE>
IF I DECIDE NOT TO TENDER, HOW WILL THE OFFER AFFECT MY SHARES?
If the merger described above takes place, stockholders not tendering in the
offer will receive the same amount of cash per share that they would have
received had they tendered their shares in the offer, subject to any
dissenters' rights properly exercised under Delaware law. Therefore, if the
merger takes place, the only difference to you between tendering your shares
and not tendering your shares is that you will be paid earlier if you tender
your shares. If the merger does not take place, however, the number of
stockholders and the number of shares of Cordant that are still in the hands
of the public may be so small that there no longer will be an active public
trading market (or, possibly, there may not be any public trading market) for
the Cordant common stock. Also, as described above, Cordant may cease making
filings with the SEC or otherwise may not be required to comply with the SEC
rules relating to publicly held companies. See the "Introduction" and Section
13 of this Offer to Purchase.
WHAT IS THE MARKET VALUE OF MY SHARES AS OF A RECENT DATE?
On March 13, 2000, the last trading day before we announced the acquisition,
the last sale price of Cordant common stock reported on the New York Stock
Exchange was $29.56 per share. On March 17, 2000, the last trading day before
we commenced the tender offer, the closing price of Cordant common stock
reported on the New York Stock Exchange was $55.56. We encourage you to obtain
a recent quotation for shares of Cordant common stock in deciding whether to
tender your shares. See Section 6.
WHAT ARE CERTAIN UNITED STATES FEDERAL INCOME TAX CONSEQUENCES OF TENDERING
SHARES?
The receipt of cash for shares pursuant to the tender offer or the merger
will be a taxable transaction for United States federal income tax purposes
and possibly for state, local and foreign income tax purposes as well. In
general, a stockholder who sells shares pursuant to the tender offer or
receives cash in exchange for shares pursuant to the merger will recognize
gain or loss for United States federal income tax purposes equal to the
difference, if any, between the amount of cash received and the stockholder's
adjusted tax basis in the shares sold pursuant to the tender offer or
exchanged for cash pursuant to the merger. If the shares exchanged constitute
capital assets in the hands of the stockholder, such gain or loss will be
capital gain or loss. In general, capital gains recognized by an individual
will be subject to a maximum United States federal income tax rate of 20% if
the shares were held for more than one year, and if held for one year or less
they will be subject to tax at ordinary income tax rates. See Section 5.
TO WHOM MAY I SPEAK IF I HAVE QUESTIONS ABOUT THE TENDER OFFER?
You may call Morrow & Co., Inc. at (800) 566-9061 (toll free) or Salomon
Smith Barney Inc. at (877) 319-4978 (toll free). Morrow & Co., Inc. is acting
as the information agent and Salomon Smith Barney Inc. is acting as the dealer
manager for our tender offer. See the back cover of this Offer to Purchase.
4
<PAGE>
To the Holders of Shares of Common Stock
of Cordant Technologies Inc.:
INTRODUCTION
Omega Acquisition Corp. (the "Purchaser"), a Delaware corporation and a
wholly owned subsidiary of Alcoa Inc., a Pennsylvania corporation ("Alcoa"),
hereby offers to purchase all outstanding shares of common stock, par value
$1.00 per share (the "Common Stock"), of Cordant Technologies Inc. (the
"Company"), and the associated rights to purchase preferred stock (the
"Rights") issued pursuant to the Rights Agreement, dated as of May 22, 1997,
as amended (the "Rights Agreement"), between the Company and First Chicago
Trust Company of New York, as rights agent (the shares of Common Stock and any
associated Rights are referred to as the "Shares"), at a price of $57.00 per
Share, net to the seller in cash (the "Offer Price"), upon the terms and
subject to the conditions set forth in this Offer to Purchase and in the
related Letter of Transmittal (which, together with any amendments or
supplements hereto or thereto, collectively constitute the "Offer").
The Offer is being made pursuant to the Agreement and Plan of Merger dated
as of March 14, 2000 (the "Merger Agreement") among Alcoa, the Purchaser and
the Company. The Merger Agreement provides that the Purchaser will be merged
with and into the Company (the "Merger") with the Company continuing as the
surviving corporation (the "Surviving Corporation"), wholly owned by Alcoa.
Pursuant to the Merger, at the effective time of the Merger (the "Effective
Time") each Share outstanding immediately prior to the Effective Time (other
than Shares owned by Alcoa or any subsidiary of Alcoa or the Company or any
subsidiary of the Company, all of which will be cancelled, and other than
Shares that are held by stockholders, if any, who properly exercise their
dissenters' rights under the Delaware General Corporation Law (the "DGCL")),
will be converted into the right to receive $57.00 or any greater per Share
price paid in the Offer in cash, without interest (the "Merger
Consideration"). The Merger Agreement is more fully described in Section 11,
which also contains a discussion of the treatment of stock options.
Tendering stockholders who are record owners of their Shares and tender
directly to the Depositary (as defined below) 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 the Purchaser pursuant to the Offer. Stockholders who
hold their Shares through a broker or bank should consult such institution as
to whether it charges any service fees. Alcoa or the Purchaser will pay all
charges and expenses of Salomon Smith Barney Inc., as dealer manager ("Salomon
Smith Barney" or the "Dealer Manager"), ChaseMellon Shareholder Services,
L.L.C., as depositary (the "Depositary"), and Morrow & Co., Inc., as
information agent (the "Information Agent"), incurred in connection with the
Offer. See Section 18.
The Board of Directors of the Company (the "Company Board") has (1)
determined that the terms of the Offer and the Merger are fair to and in the
best interests of the stockholders of the Company, (2) approved the Merger
Agreement and the transactions contemplated thereby, including the Offer and
the Merger and (3) unanimously recommends that the Company's stockholders
accept the Offer and tender their shares pursuant to the Offer and approve and
adopt the Merger Agreement.
Morgan Stanley & Co. Incorporated ("Morgan Stanley"), the Company's
financial advisor, has delivered to the Company Board its written opinion
dated March 13, 2000, to the effect that, as of such date and based on and
subject to the matters stated in such opinion, the consideration to be
received by holders of Shares pursuant to the Merger Agreement is fair from a
financial point of view to such holders. The full text of Morgan Stanley's
written opinion, which describes the assumptions made, procedures followed,
matters considered and limitations on the review undertaken, is included as an
annex to the Company's Solicitation/Recommendation Statement on Schedule 14D-9
(the "Schedule 14D-9") under the Securities Exchange Act of 1934, as amended
(the "Exchange Act"), which is being mailed to stockholders concurrently
herewith. Stockholders are urged to read the full text of such opinion
carefully in its entirety.
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The Offer is conditioned upon, among other things, (1) there being validly
tendered in accordance with the terms of the Offer and not withdrawn prior to
the expiration date of the Offer that number of Shares that represents at
least a majority of the then outstanding Shares on a fully diluted basis (the
"Minimum Condition") and (2) the waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, and the regulations thereunder
(the "HSR Act") having expired or been terminated. The Offer is also subject
to the satisfaction of certain other conditions. See Section 15.
For purposes of the Offer, "on a fully diluted basis" means, as of any time,
on a basis that includes the number of Shares that are actually issued and
outstanding plus the maximum number of Shares that the Company may be required
to issue pursuant to obligations under stock options, warrants and other
rights or securities convertible into shares of Common Stock, whether or not
currently exercisable.
The Company has advised Alcoa that, on March 3, 2000, 36,714,831 Shares were
issued and outstanding and 3,091,298 Shares were subject to stock option
grants. Neither Alcoa, the Purchaser nor any person listed on Schedule I
hereto beneficially owns any Shares. Accordingly, the Purchaser believes that
the Minimum Condition would be satisfied if approximately 19,903,065 Shares
were validly tendered and not withdrawn prior to the expiration of the Offer.
The Merger Agreement provides that promptly upon the purchase of and payment
for Shares pursuant to the Offer, Alcoa will be entitled to designate such
number of directors, rounded up to the next whole number, on the Company Board
that equals the product of (1) the total number of directors on the Company
Board (giving effect to the directors designated by Alcoa pursuant to the
Merger Agreement) and (2) the percentage that the number of Shares so
purchased and paid for bears to the total number of Shares then outstanding.
The Company has agreed, upon request of the Purchaser, promptly to increase
the size of the Company Board or exercise its best efforts to secure the
resignations of such number of directors, or both, as is necessary to enable
Alcoa's designees to be so elected to the Company Board and, subject to
Section 14(f) of the Exchange Act and Rule 14f-1 promulgated thereunder, to
cause Alcoa's designees to be so elected; provided, however, that until the
Effective Time there shall be at least two members of the Company Board who
were directors as of the date of the Merger Agreement and are not employees of
the Company. See Section 11.
The Company and the Rights Agent under the Rights Agreement amended the
Rights Agreement to provide that (1) so long as the Merger Agreement has not
been terminated pursuant to the termination provisions thereof, a Distribution
Date (as defined in the Rights Agreement) will not occur or be deemed to
occur, and neither Alcoa nor the Purchaser will become an Acquiring Person (as
defined in the Rights Agreement), as a result of the execution, delivery or
performance of the Merger Agreement, the announcement, making or consummation
of the Offer, the acquisition of Shares pursuant to the Offer or the Merger,
the consummation of the Merger or any other transaction contemplated by the
Merger Agreement and (2) the Rights will expire immediately prior to the
consummation of the Offer.
The Merger is subject to the satisfaction or waiver of certain conditions,
including, if required, the approval and adoption of the Merger Agreement by
the affirmative vote of the holders of a majority of the outstanding Shares.
If the Minimum Condition is satisfied, the Purchaser would have sufficient
voting power to approve the Merger without the affirmative vote of any other
stockholder of the Company. The Company has agreed, if required, to cause a
meeting of its stockholders to be held as promptly as practicable following
consummation of the Offer for the purposes of considering and taking action
upon the approval and adoption of the Merger Agreement. Alcoa and the
Purchaser have agreed to vote their Shares in favor of the approval and
adoption of the Merger Agreement. See Section 11.
This Offer to Purchase and the related Letter of Transmittal contain
important information that should be read carefully before any decision is
made with respect to the Offer.
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THE TENDER OFFER
1. Terms of the Offer
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of such extension or
amendment), the Purchaser will accept for payment and pay for all Shares
validly tendered prior to the Expiration Date and not properly withdrawn as
permitted under Section 4. The term "Expiration Date" means 5:00 p.m., New
York City time, on Monday, April 24, 2000, unless the Purchaser, in accordance
with the Merger Agreement, extends the period during which the Offer is open,
in which event the term "Expiration Date" means the latest time and date on
which the Offer, as so extended (other than any extension with respect to the
Subsequent Offering Period described below), expires.
The Offer is conditioned upon the satisfaction of the Minimum Condition and
the other conditions set forth in Section 15. Subject to the provisions of the
Merger Agreement, the Purchaser may waive any or all of the conditions to its
obligation to purchase Shares pursuant to the Offer (other than the Minimum
Condition). If by the initial Expiration Date or any subsequent Expiration
Date any or all of the conditions to the Offer have not been satisfied or
waived, subject to the provisions of the Merger Agreement, the Purchaser may
elect to (i) terminate the Offer and return all tendered Shares to tendering
stockholders, (ii) waive all of the unsatisfied conditions (other than the
Minimum Condition) and, subject to any required extension, purchase all Shares
validly tendered by the Expiration Date and not properly withdrawn or (iii)
extend the Offer and, subject to the right of stockholders to withdraw Shares
until the new Expiration Date, retain the Shares that have been tendered until
the expiration of the Offer as extended.
The Purchaser will not make any change without the prior written consent of
the Company that (i) decreases the price per Share payable in the Offer, (ii)
reduces the maximum number of Shares to be purchased in the Offer, (iii)
changes the form of consideration to be paid in the Offer, (iv) modifies or
amends any of the conditions to the Offer set forth in Section 15, (v) imposes
conditions to the Offer in addition to the conditions set forth in Section 15,
(vi) waives the Minimum Condition, (vii) makes any other changes in the terms
and conditions of the Offer that are in any manner adverse to the holders of
Shares or (viii) except as provided below, extends the Offer.
Subject to the terms of the Merger Agreement, the Purchaser may, without the
consent of the Company, (i) extend the Offer beyond the scheduled expiration
date if any of the conditions to the Purchaser's obligation to accept for
payment and to pay for the Shares are not satisfied or, to the extent
permitted by the Merger Agreement, waived or (ii) extend the Offer for any
period required by any rule, regulation or interpretation of the Securities
and Exchange Commission (the "SEC") or its staff applicable to the Offer,
other than Rule 14e-5 promulgated under the Exchange Act. In addition, unless
the Company advises the Purchaser that it does not wish the Purchaser to
extend the Offer, the Purchaser shall extend the Offer from time to time until
the earlier of (a) 30 days after the date on which any applicable waiting
period under the HSR Act has expired or been terminated, the notification of
and approval by the European Commission under the EU Council Regulation
4064/89, as amended (the "EU Regulation"), has been received and the
applicable waiting period under the Canadian Competition Act (the "Competition
Act") has expired (the "Regulatory Condition") or (b) September 30, 2000, in
the event that on such date all of the conditions to the Offer have not been
satisfied or waived as permitted by the Merger Agreement. An extension
described in the preceding sentence or described in clause (i) of the first
sentence of this paragraph will not exceed the lesser of (a) ten business days
or (b) such smaller number of days that the Purchaser reasonably believes is
necessary to cause the conditions of the Offer to be satisfied.
Rule 14d-11 under the Exchange Act permits the Purchaser, subject to certain
conditions, to provide a subsequent offering period following the expiration
of the Offer on the Expiration Date (a "Subsequent Offering Period"). A
Subsequent Offering Period is an additional period of time from three business
days to 20 business days in length, beginning after the Purchaser purchases
Shares tendered in the Offer, during which stockholders may tender, but not
withdraw, their Shares and receive the Offer Price.
The Purchaser has agreed to include a Subsequent Offering Period of not less
than three business days in the event that all of the conditions to the Offer
have been satisfied or waived, as permitted by the Merger Agreement, as of the
Expiration Date. Pursuant to Rule 14d-7 under the Exchange Act, no withdrawal
rights
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apply to Shares tendered during a Subsequent Offering Period and no withdrawal
rights apply during the Subsequent Offering Period with respect to Shares
tendered in the Offer and accepted for payment. During a Subsequent Offering
Period, the Purchaser will promptly purchase and pay for all Shares tendered
at the same price paid in the Offer.
Subject to the applicable rules and regulations of the SEC and the
provisions of the Merger Agreement, the Purchaser also expressly reserves the
right, in its sole discretion, at any time or from time to time, (i) to
terminate the Offer if any of the conditions set forth in Section 15 have not
been satisfied and (ii) to waive any condition to the Offer (other than the
Minimum Condition) or otherwise amend the Offer in any respect, in each case
by giving oral or written notice of such extension, termination, waiver or
amendment to the Depositary and by making a public announcement thereof. If
the Purchaser accepts for payment any Shares pursuant to the Offer, it will
accept for payment all Shares validly tendered prior to the Expiration Date
and not properly withdrawn, and will promptly pay for all Shares so accepted
for payment.
The rights reserved by the Purchaser by the preceding paragraph are in
addition to the Purchaser's rights pursuant to Section 15. Any 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, in
accordance with the public announcement requirements of Rule 14e-1(d) under
the Exchange Act. Subject to applicable law (including Rules 14d-4(d) and 14d-
6(c) under the Exchange Act, which require that material changes be promptly
disseminated to stockholders in a manner reasonably designed to inform them of
such changes) and without limiting the manner in which the Purchaser may
choose to make any public announcement, the Purchaser shall 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.
If the Purchaser extends the Offer or if the Purchaser is delayed in its
acceptance for payment of or payment for Shares or it is unable to pay for
Shares pursuant to the Offer for any reason, then, without prejudice to the
Purchaser's rights under the Offer, the Depositary may retain tendered Shares
on behalf of the Purchaser, and such Shares may not be withdrawn except to the
extent tendering stockholders are entitled to withdrawal rights as described
herein under Section 4. However, the ability of the Purchaser to delay the
payment for Shares that the Purchaser has accepted for payment is limited by
(i) Rule 14e-1(c) under the Exchange Act, which requires that a bidder pay the
consideration offered or return the securities deposited by or on behalf of
stockholders promptly after the termination or withdrawal of such bidder's
offer, unless such bidder elects to offer a Subsequent Offering Period and
pays for Shares tendered during the Subsequent Offering Period in accordance
with Rule 14d-11 under the Exchange Act and (ii) the terms of the Merger
Agreement, which require that the Purchaser pay for Shares that are tendered
pursuant to the Offer as soon as permitted after the Offer.
If the Purchaser makes a material change in the terms of the Offer or the
information concerning the Offer, or if it waives a material condition of the
Offer, the Purchaser will disseminate additional tender offer materials and
extend the Offer to the extent required by Rules 14d-4(d), 14d-6(c) and 14e-1
under the Exchange Act. The minimum period during which an offer must remain
open following material changes in the terms of the Offer, other than a change
in price, percentage of securities sought or inclusion of or changes to a
dealer's soliciting fee, will depend upon the facts and circumstances,
including the materiality, of the changes. In the SEC's view, an offer should
remain open for a minimum of five (5) business days from the date the material
change is first published, sent or given to stockholders and, if material
changes are made with respect to information that approaches the significance
of price and share levels, a minimum of ten (10) business days may be required
to allow for adequate dissemination to stockholders. Accordingly, if, prior to
the Expiration Date, the Purchaser decreases the number of Shares being sought
or increases the consideration offered pursuant to the Offer, and if the Offer
is scheduled to expire at any time earlier than the tenth business day from
the date that notice of such increase or decrease is first published, sent or
given to stockholders, the Offer will be extended at least until the
expiration of such tenth business day.
The Company has provided the Purchaser with the Company's stockholder list
and security position listings for the purpose of disseminating the Offer to
holders of Shares. This Offer to Purchase and the related Letter of
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Transmittal will be mailed to record holders of Shares whose names appear on
the Company's stockholder 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 stockholder 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) and the satisfaction or earlier waiver of all the conditions to
the Offer set forth in Section 15, the Purchaser will accept for payment and
will pay for all Shares validly tendered prior to the Expiration Date and not
properly withdrawn pursuant to the Offer as soon as it is permitted to do so
under applicable law. Subject to the Merger Agreement and compliance with Rule
14e-1(c) under the Exchange Act, the Purchaser expressly reserves the right to
delay payment for Shares in order to comply in whole or in part with any
applicable law. See Section 16.
In all cases, payment for Shares accepted for payment pursuant to the Offer
will be made only after timely receipt by the Depositary of (1) the
certificates evidencing such Shares (the "Share Certificates") or 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
Facility") pursuant to the procedures set forth in Section 3, (2) the Letter
of Transmittal (or a 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 (as defined below) in lieu of the Letter of
Transmittal and (3) any other documents required by the Letter of Transmittal.
For purposes of the Offer, the Purchaser will be deemed to have accepted for
payment, and thereby purchased, Shares validly tendered and not properly
withdrawn as, if and when the Purchaser gives oral or written notice to the
Depositary of the 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 payment pursuant to the Offer will be made by
deposit of the Offer Price therefor with the Depositary, which will act as
agent for tendering stockholders for the purpose of receiving payments from
the Purchaser and transmitting such payments to tendering stockholders whose
Shares have been accepted for payment. If, for any reason whatsoever,
acceptance for payment of any Shares tendered pursuant to the Offer is
delayed, or the Purchaser is unable to accept for payment Shares tendered
pursuant to the Offer, then, without prejudice to the Purchaser's rights under
Section 1 hereof, the Depositary may, nevertheless, on behalf of the
Purchaser, retain tendered Shares, and such Shares may not be withdrawn,
except to the extent that the tendering stockholders are entitled to
withdrawal rights as described in Section 4 and as otherwise required by Rule
14e-1(c) under the Exchange Act.
Under no circumstances will interest on the Offer Price 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 stockholder (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.
The 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
transaction or assignment will not relieve the Purchaser of its obligations
under the Offer and will in no way prejudice the rights of tendering
stockholders to receive payment for Shares validly tendered and accepted for
payment pursuant to the Offer.
3. Procedures for Accepting the Offer and Tendering Shares.
Valid Tenders. In order for a stockholder validly to tender Shares pursuant
to the Offer, either (1) the Letter of Transmittal (or a facsimile thereof),
properly completed and duly executed, together with any required
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signature guarantees (or, in the case of a book-entry transfer, an Agent's
Message in lieu of the Letter of Transmittal) 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 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, in each case prior to the
Expiration Date, or (2) the tendering stockholder must comply with the
guaranteed delivery procedures described below.
The term "Agent's Message" means a message, transmitted by the Book-Entry
Transfer Facility, to and received by, the Depositary and forming a part of a
Book-Entry Confirmation, that 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
terms of the Letter of Transmittal and that the Purchaser may enforce such
agreement against such participant.
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, either the Letter of Transmittal (or a facsimile thereof),
properly completed and duly executed, together with any required signature
guarantees, or an Agent's Message in lieu of the Letter of Transmittal, 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 stockholder 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.
Signature Guarantees. No signature guarantee is required on the Letter of
Transmittal (1) if the Letter of Transmittal is signed by the registered
holder of the Shares tendered therewith, unless such holder has completed
either the box entitled "Special Delivery Instructions" or the box entitled
"Special Payment Instructions" on the Letter of Transmittal or (2) if the
Shares are tendered for the account of a firm that is participating in the
Security Transfer Agents Medallion Program, the New York Stock Exchange
Medallion Signature Guarantee Program or the Stock Exchange Medallion Program
(each an "Eligible Institution" and collectively "Eligible Institutions"). In
all other cases, all signatures on a Letter of Transmittal must be guaranteed
by an Eligible Institution. See Instruction 1 of the Letter of Transmittal. If
a Share Certificate is registered in the name of a person or persons other
than the signer of the Letter of Transmittal, or if payment is to be made or
delivered to, or a Share Certificate not accepted for payment or not tendered
is to be issued, in the name of a person other than the registered holder(s),
then the Share Certificate must be endorsed or accompanied by appropriate duly
executed 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
as provided in the Letter of Transmittal. See Instructions 1 and 5 of the
Letter of Transmittal.
Guaranteed Delivery. If a stockholder desires to tender Shares pursuant to
the Offer and the Share Certificates evidencing such stockholder's Shares are
not immediately available or such stockholder cannot deliver the Share
Certificates and all other required documents to the Depositary prior to the
Expiration Date, or such stockholder cannot complete the procedure for
delivery by book-entry transfer on a timely basis, such Shares may
nevertheless be tendered; provided that all of the following conditions are
satisfied:
(1) such tender is made by or through an Eligible Institution;
(2) a properly completed and duly executed Notice of Guaranteed Delivery,
substantially in the form made available by the Purchaser, is received
prior to the Expiration Date by the Depositary as provided below; and
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(3) 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 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 New York Stock Exchange trading days after
the date of execution of such Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand or transmitted by
facsimile transmission or mailed 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 the Purchaser.
In all cases, Shares will not be deemed validly tendered unless a properly
completed and duly executed Letter of Transmittal (or a facsimile thereof) is
received by the Depositary.
The method of delivery of Share Certificates, the Letter of Transmittal and
all other required documents, including delivery through the Book-Entry
Transfer Facility, is at the option and risk of the tendering stockholder, and
the delivery will be deemed made only when actually received by the Depositary
(including, in the case of a book-entry transfer, receipt of a Book-Entry
Confirmation). 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.
Determination of Validity. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance for payment of any
tender of Shares will be determined by the Purchaser in its sole discretion,
which determination shall be final and binding on all parties. The 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. The Purchaser also reserves the absolute
right to waive any defect or irregularity in the tender of any Shares of any
particular stockholder, whether or not similar defects or irregularities are
waived in the case of other stockholders. No tender of Shares will be deemed
to have been validly made until all defects and irregularities have been cured
or waived to the satisfaction of the Purchaser. None of the Purchaser, the
Dealer Manager, the Depositary, the Information Agent or any other person will
be under any duty to give notification of any defects or irregularities in
tenders or incur any liability for failure to give any such notification. The
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.
Other Requirements. By executing the Letter of Transmittal as set forth
above, a tendering stockholder irrevocably appoints designees of the Purchaser
as such stockholder's proxies, each with full power of substitution, in the
manner set forth in the Letter of Transmittal, to the full extent of such
stockholder's rights with respect to the Shares tendered by such stockholder
and accepted for payment by the Purchaser (including, with respect to any and
all other Shares or other securities issued or issuable in respect of such
Shares on or after the date of this Offer to Purchase). All such proxies shall
be considered coupled with an interest in the tendered Shares. Such
appointment will be effective when, and only to the extent that, the Purchaser
accepts such Shares for payment. Upon such acceptance for payment, all prior
proxies given by such stockholder with respect to such Shares (and such other
Shares and securities) will be revoked without further action, and no
subsequent proxies may be given nor any subsequent written consent executed by
such stockholder (and, if given or executed, will not be deemed to be
effective) with respect thereto. The designees of the Purchaser will, with
respect to the Shares for which the appointment is effective, be empowered to
exercise all voting and other rights of such stockholder as they in their sole
discretion may deem proper at any annual or special meeting of the Company's
stockholders or any adjournment or postponement thereof, by written consent in
lieu of any such meeting or otherwise. The Purchaser reserves the right to
require that, in order for Shares to be deemed validly tendered, immediately
upon the Purchaser's payment for such Shares, the Purchaser must be able to
exercise full voting rights with respect to such Shares.
The tender of Shares pursuant to any one of the procedures described above
will constitute the tendering stockholder's acceptance of the Offer, as well
as the tendering stockholder's representation and warranty that
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such stockholder has the full power and authority to tender and assign the
Shares tendered, as specified in the Letter of Transmittal. The Purchaser's
acceptance for payment of Shares tendered pursuant to the Offer will
constitute a binding agreement between the tendering stockholder and the
Purchaser upon the terms and subject to the conditions of the Offer.
Backup Withholding. Under the "backup withholding" provisions of United
States federal income tax law, the Depositary may be required to withhold 31%
of the amount of any payments pursuant to the Offer. In order to prevent
backup federal income tax withholding with respect to payments to certain
stockholders of the Offer Price of Shares purchased pursuant to the Offer,
each such stockholder must provide the Depositary with such stockholder's
correct taxpayer identification number ("TIN") and certify that such
stockholder is not subject to backup withholding by completing the Substitute
Form W-9 in the Letter of Transmittal. Certain stockholders (including, among
others, all corporations and certain foreign individuals and entities) are not
subject to backup withholding. If a stockholder does not provide its correct
TIN or fails to provide the certifications described above, the Internal
Revenue Service may impose a penalty on the stockholder and payment of cash to
the stockholder pursuant to the Offer may be subject to backup withholding.
All stockholders surrendering Shares pursuant to the Offer should complete and
sign the Substitute Form W-9 included in the Letter of Transmittal to provide
the information necessary to avoid backup withholding. Non-corporate foreign
stockholders should complete and sign a Form W-8, Certificate of Foreign
Status (a copy of which may be obtained from the Depositary) in order to avoid
backup withholding. See Instruction 8 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 the Purchaser pursuant to the
Offer, may also be withdrawn at any time after Thursday, May 18, 2000 (or such
later date as may apply if the Offer is extended).
For a withdrawal to be effective, a written, telegraphic 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, address and
taxpayer identification number 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 hereof, any notice of withdrawal must also specify the
name and number of the account at the Book-Entry Transfer Facility to be
credited with the withdrawn Shares.
If the 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 the Purchaser's rights under the Offer,
the Depositary may, nevertheless, on behalf of the Purchaser, retain tendered
Shares, and such Shares may not be withdrawn except to the extent that
tendering stockholders are entitled to withdrawal rights as described herein.
All questions as to the form and validity (including time of receipt) of any
notice of withdrawal will be determined by the Purchaser, in its sole
discretion, whose determination will be final and binding. None of the
Purchaser, the Dealer Manager, the Depositary, the Information Agent or any
other person will be under duty to give notification of any defects or
irregularities in any notice of withdrawal or incur any liability for failure
to give any such notification.
12
<PAGE>
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. However, withdrawn Shares may be re-tendered at any time prior to
the Expiration Date or during the Subsequent Offering Period by following one
of the procedures described in Section 3 hereof.
No withdrawal rights will apply to Shares tendered into a Subsequent
Offering Period and no withdrawal rights apply during the Subsequent Offering
Period with respect to Shares tendered in the Offer and accepted for payment.
See Section 1.
5. Certain United States Federal Income Tax Consequences.
The following is a summary of certain United States federal income tax
consequences of the Offer and the Merger to stockholders of the Company whose
Shares are tendered and accepted for payment pursuant to the Offer or whose
Shares are converted into the right to receive cash in the Merger. The
discussion is for general information only and does not purport to consider
all aspects of United States federal income taxation that might be relevant to
stockholders of the Company. The discussion is based on current provisions of
the Internal Revenue Code of 1986, as amended (the "Code"), existing, proposed
and temporary regulations promulgated thereunder and administrative and
judicial interpretations thereof, all of which are subject to change, possibly
with a retroactive effect. The discussion applies only to stockholders of the
Company in whose hands Shares are capital assets within the meaning of Section
1221 of the Code and who do not own directly or through attribution 50% or
more of the stock of Alcoa. This discussion does not apply to Shares received
pursuant to the exercise of employee stock options or otherwise as
compensation, or to certain types of stockholders (such as insurance
companies, tax-exempt organizations, financial institutions and broker-
dealers) who may be subject to special rules. This discussion does not discuss
the United States federal income tax consequences to any stockholder of the
Company who, for United States federal income tax purposes, is a non-resident
alien individual, a foreign corporation, a foreign partnership or a foreign
estate or trust, nor does it consider the effect of any foreign, state or
local tax laws.
Because individual circumstances may differ, each stockholder should consult
his or her own tax advisor to determine the applicability of the rules
discussed below and the particular tax effects of the Offer and the Merger, on
a beneficial holder of Shares, including the application and effect of the
alternative minimum tax, and any state, local and foreign tax laws and of
changes in such laws.
The exchange of Shares for cash pursuant to the Offer or the Merger will be
a taxable transaction for United States federal income tax purposes and
possibly for state, local and foreign income tax purposes as well. In general,
a stockholder who sells Shares pursuant to the Offer or receives cash in
exchange for Shares pursuant to the Merger will recognize gain or loss for
United States federal income tax purposes equal to the difference, if any,
between the amount of cash received and the stockholder's adjusted tax basis
in the Shares sold pursuant to the Offer or exchanged for cash pursuant to the
Merger. Gain or loss will be determined separately for each block of Shares
(i.e., Shares acquired at the same cost in a single transaction) tendered
pursuant to the Offer or exchanged for cash pursuant to the Merger. Such gain
or loss will be long-term capital gain or loss provided that a stockholder's
holding period for such Shares is more than one year at the time of
consummation of the Offer or the Merger, as the case may be. Capital gains
recognized by an individual upon a disposition of a Share that has been held
for more than one year generally will be subject to a maximum United States
federal income tax rate of 20% or, in the case of a Share that has been held
for one year or less, will be subject to tax at ordinary income tax rates.
Certain limitations apply to the use of a stockholder's capital losses.
A stockholder whose Shares are purchased in the Offer may be subject to 31%
backup withholding unless certain information is provided to the Depositary or
an exemption applies. See Section 3.
13
<PAGE>
6. Price Range of Shares; Dividends.
The Shares trade on the New York Stock Exchange (the "NYSE") under the
symbol "CDD." The following table sets forth, for the periods indicated, the
high and low sale prices per Share as well as the dividends paid to
stockholders for the periods indicated. The Rights trade together with the
Common Stock. Share prices are as reported on the NYSE based on published
financial sources.
<TABLE>
<CAPTION>
Common Stock
----------------------------
High Low Dividends
---- ---- ---------
<S> <C> <C> <C>
Twelve Months Ended December 31, 1998:
First Quarter................................... $50 1/8 $39 17/32 $0.10
Second Quarter.................................. 55 3/4 44 1/2 0.10
Third Quarter................................... 47 3/8 35 1/2 0.10
Fourth Quarter.................................. 44 5/8 31 3/8 0.10
Fiscal Year 1999:
First Quarter................................... 42 7/8 30 1/8 0.10
Second Quarter.................................. 52 3/8 39 9/16 0.10
Third Quarter................................... 49 30 0.10
Fourth Quarter.................................. 33 1/8 25 1/2 0.10
Fiscal Year 2000:
First Quarter (through March 17, 2000).......... 55 9/16 28 15/16 0.10
</TABLE>
On March 13, 2000, the last full day of trading before the public
announcement of the execution of the Merger Agreement, the closing price of
the Shares on the NYSE was $29.56 per Share. On March 17, 2000, the last full
day of trading before the commencement of the Offer, the closing price of the
Shares on the NYSE was $55.56 per Share. Stockholders are urged to obtain a
current market quotation for the Shares.
7. Certain Information Concerning the Company.
General. The Company is a Delaware corporation with its principal offices
located at 15 W. South Temple, Suite 1600, Salt Lake City, Utah 84101. The
telephone number of the Company is (801) 933-4000. According to the Company's
Form 10-K for the fiscal year ended December 31, 1998, the Company operates in
three business segments. Thiokol Propulsion is a leading producer of high
technology solid rocket motors for space, defense and commercial launch
applications. Huck International, Inc., a wholly owned subsidiary of the
Company, is a major supplier of precision fastening systems for aerospace and
industrial markets worldwide and custom injection molded plastic products. The
Company's 84.6 percent owned subsidiary, Howmet International Inc. ("Howmet"),
is a leading manufacturer of investment cast turbine engine components for jet
aircraft and industrial gas turbine power generation markets, as well as a
leading producer of aluminum investment castings for commercial aerospace and
defense electronics industries.
Available Information. The Shares are registered under the Exchange Act.
Accordingly, the Company is subject to the informational reporting
requirements of the Exchange Act and, in accordance therewith, is required to
file periodic reports, proxy statements and other information with the SEC
relating to its business, financial condition and other matters. Such reports,
proxy statements and other information can be inspected and copied at the
public reference facilities maintained by the SEC at 450 Fifth Street, N.W.,
Room 1024, Washington, D.C. 20549, and at the SEC's regional offices located
at Seven World Trade Center, Suite 1300, New York, New York 10048 and Citicorp
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661.
Information regarding the public reference facilities may be obtained from the
SEC by telephoning 1-800-SEC-0330. The Company's filings are also available to
the public on the SEC's Internet site (http://www.sec.gov). Copies of such
materials may also be obtained by mail from the Public Reference Section of
the SEC at 450 Fifth Street, N.W., Washington, D.C. 20549 at prescribed rates.
14
<PAGE>
Summary Unaudited Financial Information. The following summary unaudited
consolidated financial data relating to the Company has been taken from the
Company's Current Report on Form 8-K, filed with the SEC on February 11, 2000.
More comprehensive financial information is included in the Company's annual
report on Form 10-K and quarterly reports on Form 10-Q and the other documents
filed by the Company with the SEC, and the financial data set forth below is
qualified in its entirety by reference to such reports and other documents and
all of the financial statements and notes contained therein. Such reports and
other documents may be examined and copies may be obtained from the offices of
the SEC in the manner set forth above.
CORDANT TECHNOLOGIES INC.
SUMMARY UNAUDITED
CONSOLIDATED FINANCIAL INFORMATION
(in millions, except per Share data)
<TABLE>
<CAPTION>
Year Ended
December 31,
------------------
1999 1998
-------- --------
<S> <C> <C>
Sales:
Investment Castings......................................... $1,459.7 $1,350.6
Fastening Systems........................................... 465.2 433.3
Propulsion Systems.......................................... 588.0 643.0
-------- --------
Total Sales............................................... $2,512.9 $2,426.9
Operating income:
Investment Castings......................................... $ 204.7 $ 185.8
Fastening Systems........................................... 52.8 65.2
Propulsion Systems.......................................... 87.9 82.1
Unallocated corporate expense............................... (25.8) (24.4)
-------- --------
Total operating income.................................... 319.6 308.7
Interest income............................................. 7.4 12.8
Interest expense............................................ (42.9) (28.3)
Other, net.................................................. (3.5) (3.8)
Income taxes................................................ (93.4) (107.6)
-------- --------
Income before minority interest............................. 187.2 181.8
Minority interest........................................... (22.8) (39.8)
-------- --------
Net income................................................ $ 164.4 $ 142.0
======== ========
Net income per share:
Basic..................................................... $ 4.49 $ 3.89
Diluted................................................... $ 4.39 $ 3.79
</TABLE>
- --------
Results for the current year include Continental/Midland's operations which
was purchased in October 1999, the additional 22.6 percent of Howmet ownership
purchased in February 1999 and Jacobson's operations, which was purchased in
Mid-June 1998.
15
<PAGE>
Except as otherwise stated in this Offer to Purchase, the information
concerning the Company contained herein has been taken from or is based upon
reports and other documents on file with the SEC or otherwise publicly
available. Although neither the Purchaser nor Alcoa has any knowledge that
would indicate that any statements contained herein based upon such reports
and documents are untrue, neither the Purchaser nor Alcoa takes any
responsibility for the accuracy or completeness of the information contained
in such reports and other documents or for any failure by the Company to
disclose events that may have occurred and may affect the significance or
accuracy of any such information but that are unknown to the Purchaser or
Alcoa.
Certain Projections. The Company does not, as a matter of course, make
public any forecasts as to its future financial performance. However, in
connection with Alcoa's review of the transactions contemplated by the Merger
Agreement, the Company provided Alcoa with certain projected financial
information concerning the Company. Such information included, among other
things, the Company's projections of gross sales, net income and earnings per
Share for the Company for the years 2000 through 2004, assuming the Company
purchased the publicly held Howmet shares at $17.00 per share. Set forth below
is a summary of such projections. These projections should be read together
with the financial statements of the Company that can be obtained from the SEC
as described above.
<TABLE>
<CAPTION>
Year Ended December 31,
--------------------------------------------
2000 2001 2002 2003 2004
-------- -------- -------- -------- --------
(in millions, except per Share data)
<S> <C> <C> <C> <C> <C>
Gross Sales........................ $2,639.5 $2,828.5 $3,013.1 $3,183.1 $3,289.8
Net Income......................... 166.2 201.6 232.3 264.9 289.8
Earnings Per Share................. $ 4.44 $ 5.38 $ 6.20 $ 7.07 $ 7.74
</TABLE>
It is the understanding of Alcoa and the Purchaser that the projections were
not prepared with a view to public disclosure or compliance with published
guidelines of the SEC or the guidelines established by the American Institute
of Certified Public Accountants regarding projections or forecasts and are
included herein only because such information was provided to Alcoa and the
Purchaser in connection with their evaluation of a business combination
transaction. The projections do not purport to present operations in
accordance with generally accepted accounting principles, and the Company's
independent auditors have not examined or compiled the projections presented
herein and accordingly assume no responsibility for them. These forward-
looking statements (as that term is defined in the Private Securities
Litigation Reform Act of 1995) are subject to certain risks and uncertainties
that could cause actual results to differ materially from the projections. The
Company has advised the Purchaser and Alcoa that its internal financial
forecasts (upon which the projections provided to Alcoa and the Purchaser were
based in part) are, in general, prepared solely for internal use and capital
budgeting and other management decisions and are subjective in many respects
and thus susceptible to interpretations and periodic revision based on actual
experience and business developments. The projections also reflect numerous
assumptions (not all of which were provided to Alcoa and the Purchaser), all
made by management of the Company, with respect to industry performance,
general business, economic, market and financial conditions and other matters,
including effective tax rates consistent with historical levels for the
Company, all of which are difficult to predict, many of which are beyond the
Company's control, and none of which were subject to approval by Alcoa or the
Purchaser. Accordingly, there can be no assurance that the assumptions made in
preparing the projections will prove accurate. It is expected that there will
be differences between actual and projected results, and actual results may be
materially greater or less than those contained in the projections. The
inclusion of the projections herein should not be regarded as an indication
that any of Alcoa, the Purchaser, the Company or their respective affiliates
or representatives considered or consider the projections to be a reliable
prediction of future events, and the projections should not be relied upon as
such. None of Alcoa,
16
<PAGE>
the Purchaser, the Company or any of their respective affiliates or
representatives has made or makes any representation to any person regarding
the ultimate performance of the Company compared to the information contained
in the projections, and none of them intends to update or otherwise revise the
projections to reflect circumstances existing after the date when made or to
reflect the occurrence of future events even in the event that any or all of
the assumptions underlying the projections are shown to be in error.
8. Certain Information Concerning Alcoa and the Purchaser.
General. Alcoa is a Pennsylvania corporation with its principal offices
located at 201 Isabella Street, Alcoa Corporate Center, Pittsburgh,
Pennsylvania 15212. The telephone number of Alcoa is (412) 553-4545. Alcoa is
the world's leading producer of primary aluminum, fabricated aluminum and
alumina and a major participant in all segments of the industry: mining,
refining, smelting, fabricating and recycling. Alcoa serves customers
worldwide primarily in the transportation (including aerospace, automotive,
rail and shipping), packaging, building and industrial markets with a great
variety of fabricated and finished products. Alcoa is organized into
approximately 25 independently managed business units and has over 250
operating locations in 31 countries.
The Purchaser is a Delaware corporation with its principal offices located
at 201 Isabella Street, Alcoa Corporate Center, Pittsburgh, Pennsylvania
15212. The telephone number of the Purchaser is (412) 553-4545. The Purchaser
is a wholly owned subsidiary of Alcoa. The Purchaser has not carried on any
activities other than in connection with the Merger Agreement.
The name, citizenship, business address, business phone number, principal
occupation or employment and five-year employment history for each of the
directors and executive officers of Alcoa and the Purchaser and certain other
information are set forth in Schedule I hereto.
Except as described in this Offer to Purchase, (1) none of Alcoa, the
Purchaser nor, to the best knowledge of Alcoa and the Purchaser, any of the
persons listed in Schedule I to this Offer to Purchase or any associate or
majority-owned subsidiary of Alcoa or the Purchaser or any of the persons so
listed beneficially owns or has any right to acquire, directly or indirectly,
any Shares and (2) none of Alcoa, the Purchaser nor, to the best knowledge of
Alcoa and the Purchaser, 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.
Except as provided in the Merger Agreement or as otherwise described in this
Offer to Purchase, none of Alcoa, the Purchaser nor, to the best knowledge of
Alcoa and the Purchaser, any of the persons listed in Schedule I to this Offer
to Purchase, has any contract, arrangement, understanding or relationship with
any other person with respect to any securities of the Company, including, but
not limited to, any contract, arrangement, understanding or relationship
concerning the transfer or voting of such securities, finder's fees, joint
ventures, loan or option arrangements, puts or calls, guarantees of loans,
guarantees against loss, guarantees of profits, division of profits or loss or
the giving or withholding of proxies.
Except as set forth in this Offer to Purchase, none of Alcoa, the Purchaser
nor, to the best knowledge of Alcoa and the Purchaser, any of the persons
listed on Schedule I hereto, has had any business relationship or transaction
with the Company or any of its executive officers, directors or affiliates
that is required to be reported under the rules and regulations of the SEC
applicable to the Offer. Except as set forth in this Offer to Purchase, there
have been no contracts, negotiations or transactions between Alcoa or any of
its subsidiaries or, to the best knowledge of Alcoa, any of the persons listed
in Schedule I to this Offer to Purchase, on the one hand, and the Company or
its affiliates, on the other hand, concerning a merger, consolidation or
acquisition, tender offer or other acquisition of securities, an election of
directors or a sale or other transfer of a material amount of assets. None of
the persons listed in Schedule I has, during the past five years, been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors). None of the persons listed in Schedule I has, during the past
five years, been a party to any judicial or administrative proceeding (except
for matters that were dismissed without sanction of 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 a finding of any violation of federal or state securities
laws.
17
<PAGE>
9. Source and Amount of Funds.
The total amount of funds required by the Purchaser to purchase Shares
pursuant to the Offer and the Merger is estimated to be approximately $2,268
million. The Purchaser will obtain such funds from Alcoa. Alcoa currently
expects to obtain the a significant portion of such funds from existing
resources and internally generated funds, including short-term borrowings in
the ordinary course of its business. For the remainder, Alcoa is evaluating a
number of financing alternatives with different maturities in both bank
borrowings and the capital markets. Alcoa will have arranged such alternatives
prior to the Expiration Date.
10. Background of the Offer; Past Contacts or Negotiations with the Company.
In early August 1999, following a meeting of the board of directors of a
corporation on whose board Mr. James R. Wilson, Chief Executive Officer of the
Company, and Mr. Alain J.P. Belda, President and Chief Executive Officer of
Alcoa, sit, Mr. Belda informally told Mr. Wilson that Alcoa from time to time
considered the Company as a possible acquisition candidate and a possible good
fit with Alcoa's businesses.
On August 12, 1999, Mr. Belda spoke with Mr. Wilson and expressed an
interest in meeting to discuss Alcoa's strategy and to explore a possible
business combination transaction with the Company. Following their discussion,
Messrs. Belda and Wilson arranged for representatives of both companies to
meet on October 1, 1999.
On October 1, 1999, Mr. Belda and Ms. Barbara S. Jeremiah, Vice President--
Corporate Development of Alcoa, met with Mr. Wilson and Mr. Richard L. Corbin,
Executive Vice President and Chief Financial Officer of the Company, at the
Company's offices in Salt Lake City. Mr. Belda suggested that, if the Company
had interest in further exploratory discussions, Alcoa and the Company should
work together to identify potential synergies that might be achieved through a
business combination transaction involving the Company and Alcoa. Mr. Wilson
told the Alcoa representatives that he would discuss with the Company Board
Alcoa's expression of interest in exploring a possible business combination
transaction.
On October 19, 1999, Mr. Wilson telephoned Mr. Belda and Ms. Jeremiah. He
stated that he had advised the Company Board of Alcoa's expression of
interest. Mr. Wilson told the Alcoa representatives that the Company was
prepared to work with Alcoa to identify potential synergies that might be
achieved through a business combination transaction involving Alcoa and the
Company.
On November 9, 1999, representatives of Alcoa and the Company met in Salt
Lake City to conduct preliminary financial due diligence. On November 10,
1999, representatives of Alcoa contacted representatives of the Company to
continue their financial due diligence discussions.
On December 2, 1999, Alcoa and the Company entered into a confidentiality
agreement to facilitate discussions between the two companies relating to a
possible business combination transaction.
During December 1999 and January 2000, representatives of Alcoa and the
Company met on several occasions to conduct further financial and business due
diligence.
On various occasions between February 9, 2000 and February 24, 2000, Mr.
Belda and Ms. Jeremiah discussed matters relating to a possible business
combination transaction with Messrs. Wilson and Corbin, including the status
of Alcoa's due diligence, structural matters relating to a possible
transaction, valuation ranges, the appropriate form of consideration to be
offered, termination fee provisions, the status and timing of the Company's
proposal on November 12, 1999 to acquire all of the outstanding publicly held
shares of Howmet common stock (the "Publicly Held Howmet Shares") for a price
of $17.00 per share in cash and the impact of that proposal on a possible
transaction between Alcoa and the Company.
On February 25, 2000, representatives of Alcoa and its financial advisors,
Salomon Smith Barney, and its legal advisors, Skadden, Arps, Slate, Meagher &
Flom LLP, met in New York with representatives of the Company's financial
advisors, Morgan Stanley & Co. Incorporated, and its legal advisors, Wachtell,
Lipton, Rosen & Katz, to discuss issues relating to the Company's November 12,
1999 proposal to acquire the Publicly Held Howmet Shares.
18
<PAGE>
During the week of February 28, 2000, Mr. Belda and Ms. Jeremiah spoke with
Mr. Wilson to discuss Alcoa's views with respect to the discussions on
February 25 relating to Howmet, and continued to discuss the possible
structure and terms of a business combination transaction involving the
Company and Alcoa.
On March 3, 2000, Alcoa's legal advisors provided the Company's legal
advisors with a form of an acquisition agreement.
Between March 3, 2000 and March 6, 2000, Alcoa's and the Company's
respective legal advisors had a number of conversations relating to certain
corporate legal issues with respect to seeking the Howmet Board's approval for
Alcoa to become an "interested stockholder" of Howmet for purposes of Section
203 of the DGCL as a result of entering into an acquisition agreement with the
Company. Alcoa's legal counsel stated that Alcoa was not prepared to enter
into an acquisition agreement with the Company unless such Howmet Board
approval was given or the Company and Howmet entered into a definitive merger
agreement pursuant to which the Company would purchase the Publicly Held
Howmet Shares at an agreed upon price.
From March 7, 2000 to March 10, 2000, the Company's and Alcoa's respective
legal advisors began negotiating the proposed form of acquisition agreement.
On March 8, 2000, representatives of the Company advised representatives of
the committee of independent directors of the Howmet Board of Directors (the
"Howmet Special Committee") of the Company's discussions with Alcoa regarding
a possible transaction involving Alcoa and the Company. At that time the
Company requested that the Howmet Special Committee consider recommending to
the Board of Directors of Howmet that it approve Alcoa's becoming an
"interested stockholder" of Howmet under Section 203 of the DGCL as a result
of Alcoa's entering into an acquisition agreement with the Company, so that
Alcoa would not be restricted from entering into a business combination with
Howmet for three years without an affirmative vote of two-thirds of the
disinterested Howmet shares.
Over the next few days, representatives of the Company conducted discussions
with representatives of the Howmet Special Committee regarding the terms under
which the committee would consider recommending the approval, for purposes of
Section 203, of Alcoa's becoming an interested stockholder of Howmet as a
result of its entering into the proposed acquisition agreement with the
Company. In addition, representatives of the Company explored with
representatives of the Howmet Special Committee the possibility of negotiating
a definitive acquisition agreement to acquire the Publicly Held Howmet Shares.
During the course of these discussions, the Company made a proposal to the
Howmet Special Committee to acquire all of the Publicly Held Howmet Shares for
$18.75 per share, but following further discussions, no agreement was reached.
On March 9, 2000, representatives of Alcoa conducted additional due
diligence relating to the Company's fasteners division.
On March 10, 2000, the Board of Directors of Alcoa held a board meeting to
review the status of the discussions between Alcoa and the Company. For the
next couple of days, Alcoa completed its due diligence investigation based on
various information contained in disclosure schedules delivered by the Company
in connection with the negotiation of the proposed acquisition agreement.
On March 11, 2000, the legal advisors to the Howmet Special Committee
contacted the Company's legal advisors and discussed the proposed terms for an
amendment to the Corporate Agreement between Howmet and the Company to provide
for additional restrictions on the Company's ability to purchase publicly held
shares of Howmet and Alcoa's entering into a separate agreement with Howmet
pursuant to which it would be bound by the same restrictions as the Company
under the amended agreement as conditions for the Howmet Special Committee's
recommending to the full Howmet Board of Directors that it approve, for
purposes of Section 203 under the DGCL, Alcoa's becoming an "interested
stockholder" of Howmet.
19
<PAGE>
On March 12, 2000 and March 13, 2000, representatives of Alcoa and the
Company satisfactorily resolved the issues relating to Alcoa's due diligence
concerns, agreed upon the purchase price and continued to negotiate the terms
of the proposed acquisition agreement.
In the afternoon on March 13, 2000, the executive committee of the Board of
Directors of Alcoa met to approve the terms of the Merger Agreement.
On March 13, 2000, the Board of Directors of Howmet approved the terms of an
amendment to the Corporate Agreement pursuant to which the Company would agree
to certain restrictions on acquiring shares of Howmet Common Stock if doing so
would reduce the number of Publicly Held Howmet Shares below 14% of the
outstanding shares. The Board of Directors of Howmet also approved the terms
of a separate agreement with Alcoa pursuant to which Alcoa agreed to be bound
by the same restrictions. In addition, on that date the full Board of
Directors of Howmet approved, for purposes of Section 203, following receipt
of the recommendation of the Howmet Special Committee for such approval,
Alcoa's becoming an interested stockholder of Howmet as a result of its
entering into the proposed acquisition agreement.
Later on March 13, the Board of the Company met to approve the Offer, the
Merger and the Merger Agreement. Following such meeting, the Company and
Howmet entered into the amendment to the Corporate Agreement and Alcoa and
Howmet entered into the letter agreement pursuant to which Alcoa agreed to be
bound by the terms of the amendment to the Corporate Agreement.
Thereafter representatives of the Company's and Alcoa's respective legal
advisors finalized the Merger Agreement, and the Merger Agreement was signed
on March 14, 2000.
On March 14, 2000, Alcoa and the Company issued a joint press release
announcing the execution of the Merger Agreement.
On March 20, 2000, in accordance with the Merger Agreement, the Purchaser
commenced the Offer.
11. The Merger Agreement; Other Arrangements.
The Merger Agreement
The following is a summary of the material provisions of the Merger
Agreement, a copy of which is filed as an exhibit to the Tender Offer
Statement on Schedule TO filed by Alcoa and the Purchaser pursuant to Rule
14d-3 of the General Rules and Regulations under the Exchange Act with the SEC
in connection with the Offer (the "Schedule TO"). The summary is qualified in
its entirety by reference to the Merger Agreement, which is deemed to be
incorporated by reference herein. Capitalized terms used herein and not
otherwise defined have the meanings ascribed to them in the Merger Agreement.
The Offer. The Merger Agreement provides for the making of the Offer. The
obligation of the Purchaser to accept for payment and pay for Shares tendered
pursuant to the Offer is subject to the satisfaction of the Minimum Condition
and the satisfaction or waiver of the Regulatory Condition and certain other
conditions that are described in Section 15.
Directors. The Merger Agreement provides that promptly upon the purchase of
and payment for Shares pursuant to the Offer, Alcoa shall be entitled to
designate such number of directors, rounded up to the next whole number, on
the Company Board that equals the product of (1) the total number of directors
on the Company Board (giving effect to the directors designated by Alcoa
pursuant to the Merger Agreement) and (2) the percentage that the number of
Shares so purchased and paid for bears to the total number of Shares then
outstanding. In furtherance thereof, the Company will, upon request of the
Purchaser, promptly increase the size of the Company Board or exercise its
best efforts to secure the resignations of such number of directors, or both,
as is necessary to enable Alcoa's designees to be so elected to the Company
Board and will cause Alcoa's
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designees to be so elected; provided, however, that until the Effective Time
there shall be at least two members of the Company Board who are directors as
of the date of the Merger Agreement and are not employees of the Company.
Following the election of Alcoa's designees to the Company Board (a) any
amendment or termination of the Merger Agreement by the Company, (b) any
extension or waiver by the Company of the time for the performance of any of
the obligations of Alcoa or the Purchaser under the Merger Agreement or (c)
any waiver of any of the Company's rights under the Merger Agreement, will
require the concurrence of a majority of the directors of the Company then in
office who neither were designated by Alcoa nor are employees of the Company.
The Merger. The Merger Agreement provides that no later than two business
days after the satisfaction or waiver of each of the conditions to the Merger
set forth therein, at the Effective Time the Purchaser will be merged with and
into the Company with the Company being the surviving corporation in the
Merger (the "Surviving Corporation"). Following the Merger, the separate
existence of the Purchaser will cease, and the Company will continue as the
Surviving Corporation, wholly owned by Alcoa.
If required by the DGCL, the Company will call and hold a meeting of its
stockholders (the "Company Stockholders' Meeting") promptly following
consummation of the Offer for the purpose of voting upon the approval of the
Merger Agreement. At any such meeting all Shares then owned by Alcoa or the
Purchaser or any subsidiary of Alcoa will be voted in favor of approval of the
Merger Agreement.
Pursuant to the Merger Agreement, each Share outstanding at the Effective
Time (other than Shares owned by Alcoa or any of its subsidiaries or by the
Company or any of its subsidiaries, all of which will be cancelled, and other
than Shares that are held by stockholders, if any, who properly exercise their
dissenters' rights under the DGCL) will be converted into the right to receive
the Merger Consideration. Stockholders who perfect their dissenters' rights
under the DGCL will be entitled to the amounts determined pursuant to such
proceedings. See Section 17.
Representations and Warranties. Pursuant to the Merger Agreement, the
Company has made customary representations and warranties to Alcoa and the
Purchaser, including representations relating to corporate existence and
power; capitalization; corporate authorizations; subsidiaries; SEC filings;
financial statements; absence of certain changes (including any material
adverse effect on the business, results of operations, assets, or financial
condition of the Company); absence of undisclosed liabilities; government
authorizations; litigation; compliance with laws; employee matters; labor
matters; environmental matters; taxes; intellectual property; accuracy of
certain disclosures; the opinion of the Company's financial advisor; the
Rights Agreement; and the required stockholder vote.
Certain representations and warranties in the Merger Agreement made by the
Company and Alcoa are qualified as to "materiality" or "Material Adverse
Effect." For purposes of the Merger Agreement and this Offer to Purchase, the
term "Material Adverse Effect" means any state of facts, event, change or
effect that has had, or would reasonably be expected to have, a material
adverse effect on the business, results of operations, assets or financial
condition of the Company and its subsidiaries, taken as a whole, or Alcoa and
its subsidiaries, taken as a whole, as the case may be.
Pursuant to the Merger Agreement, Alcoa and the Purchaser have made
customary representations and warranties to the Company, including
representations relating to their corporate existence and power; good
standing; corporate authority; corporate authorizations; the accuracy of
certain disclosures; receipt of the opinion of Alcoa's financial advisor;
their ability to finance the Offer and the Merger; and their not owning any
Shares or any shares of common stock of Howmet.
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Covenants. The Merger Agreement contains various covenants of the parties
thereto. A description of certain of these covenants follows:
Company Conduct of Business Covenants. The Merger Agreement provides that,
prior to the Effective Time and except as may be agreed in writing by Alcoa,
which agreement will not be unreasonably withheld or delayed, or as expressly
permitted by the Merger Agreement, the Company:
(1) will, and will cause each of its subsidiaries to, conduct its
operations in all material respects according to its ordinary course of
business;
(2) will use its reasonable best efforts to, and cause each of its
subsidiaries to use its reasonable efforts to, (a) preserve intact its
business organization and goodwill, (b) keep available the services of
its current officers and other key employees and (c) preserve its
current relationships with those persons having significant business
dealings with the Company and its subsidiaries;
(3) will notify Alcoa of any emergency or other substantial change in the
normal course of its or its subsidiaries' respective businesses or in
the operation of its or its subsidiaries' respective properties and of
any complaints of or hearings of which the Company has knowledge before
any governmental entity if such emergency, change, complaint or hearing
would have a Material Adverse Effect on the Company;
(4) will not, and will not permit any of its subsidiaries that is not
incorporated or organized in the United States or not wholly owned to,
repatriate funds, authorize or pay any dividends on or make any
distribution with respect to its outstanding shares of capital stock
(other than (a) regular quarterly cash dividends by the Company in an
amount not to exceed $0.10 per Share per quarter declared and paid in
accordance with past practice, including establishment of record and
payment dates and (b) dividends or distributions by wholly owned
subsidiaries of the Company);
(5) will not, and will not permit any of its subsidiaries to, establish,
enter into or amend any severance plan, agreement or arrangement or any
employee benefit plan or materially increase the compensation payable
or the benefits provided to its officers or employees, except as may be
required by applicable law or a contract in existence on the date of
the Merger Agreement and except for increases for nonofficer employees
in the normal course of business consistent with past practice;
(6) will not, and will not permit any of its subsidiaries to, authorize or
announce an intention to authorize, or enter into an agreement with
respect to, any merger, consolidation or business combination (other
than the Merger), any acquisition of any assets or securities or any
disposition of any assets or securities, except in an amount that is
not material to the Company and its subsidiaries taken as a whole;
(7) will not, and will not permit any of its subsidiaries to, propose or
adopt any amendments to its certificate of incorporation or by-laws (or
other similar organizational documents);
(8) will not, and will not permit any of its subsidiaries to, issue or
authorize the issuance of, or agree to issue or sell any shares of
capital stock of any class except for (a) the issuance of Common Stock
and associated Rights pursuant to options and grants outstanding as of
the date of the Merger Agreement that were issued or made pursuant to
the Company's stock award or long-term incentive plans, (b) the
issuance of common stock, par value $0.01 per share ("Howmet Common
Stock"), of Howmet, pursuant to options and grants outstanding as of
the date of the Merger Agreement that were issued or made pursuant to
Howmet's stock award plans; or take any action to cause to be
exercisable any otherwise unexercisable option under any existing stock
option plan and (c) the annual issuance to each non-employee director
of the Company of Shares having a value of $20,000; provided that such
issuance is made at such time as is consistent with past practice;
(9) will not, and will not permit any of its subsidiaries to, reclassify,
combine, split, purchase or redeem any shares of its capital stock or
purchase or redeem any rights, warrants or options to acquire any such
shares (other than as contemplated by the Company's employee benefit
plans);
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(10) will not, and will not permit any of its subsidiaries to, (a) incur
any indebtedness for borrowed money other than (i) incurrences and
repayments of indebtedness under the Company's or its subsidiaries'
credit facilities in existence on the date of the Merger Agreement in
the ordinary course of business consistent with past practice and (ii)
in an amount not to exceed $40 million in the aggregate or (b) assume,
guarantee, endorse or otherwise become liable or responsible for the
obligations of any other person, except for guarantees by subsidiaries
of the Company of indebtedness permitted under the preceding clause
(a);
(11) will not, and will not permit any of its subsidiaries to (or consent
to any proposal by any entity in which the Company has an investment
to), make or forgive any loans, advances or capital contributions to,
or investments in, any other person, other than the Company or any
wholly owned subsidiary of the Company, other than advances to
employees in the ordinary course of business in accordance with the
Company's or its subsidiaries' established policies;
(12) will not, and will not permit any of its subsidiaries to, (a) enter
into any material lease or license or otherwise subject to any
material lien any of its properties or assets (including
securitizations), other than in the ordinary course of business
consistent with past practice; (b) modify or amend in any material
respect, or terminate, any of its material contracts (except (x) with
respect to "classified" contracts or (y) in the ordinary course of
business); (c) waive, release or assign any rights that are material
to the Company and its subsidiaries taken as a whole; or (d) permit
any insurance policy naming it as a beneficiary or a loss payable
payee to lapse, be cancelled or expire unless a new policy with
substantially identical coverage is in effect as of the date of lapse,
cancellation or expiration;
(13) will not, and will not permit any of its subsidiaries to, change any
of the financial accounting methods used by it unless required by
generally accepted accounting principles of the applicable country or
a change in applicable law;
(14) will not, and will not permit any of its subsidiaries to, file with,
or submit to, any governmental entity (including the SEC) any
registration statement, prospectus or similar document relating to the
issuance of any securities of the Company or any subsidiary of the
Company, other than a registration statement of the Company on Form S-
8 filed with the SEC in connection with its stock awards and long-term
incentive plans in the ordinary course of business consistent with
past practice; and
(15) will not, and will not permit its subsidiaries to, agree to take any
of the foregoing actions or take any action that would (a) make
certain representations and warranties of the Company in the Merger
Agreement untrue or incorrect in any material respect or (b) result in
any of the conditions to the Offer or any of the conditions to the
Merger not being satisfied.
The restrictions on the operation of the Company and its subsidiaries
described above do not preclude (a) the Company and its subsidiaries from
discussing and negotiating the acquisition of the Publicly Held Howmet Shares,
provided that the Company may not enter into an agreement with respect to any
such acquisition without the consent of Alcoa or (b) Howmet from entering into
discussions and negotiations with Alcoa for the acquisition of the Publicly
Held Howmet Shares.
Alcoa Conduct of Business Covenant. The Merger Agreement provides that,
prior to the Effective Time and except as may be agreed in writing by the
Company or as may be expressly permitted pursuant to the Merger Agreement,
Alcoa will not, and will not permit any of its subsidiaries to, (i) agree, in
writing or otherwise, to take any action that would result in any of the
conditions to the Offer or any of the conditions to the Merger not being
satisfied or (ii) delay the consummation of the Offer, including by
application of Rule 14e-5 under the Exchange Act.
Access; Confidentiality. The Merger Agreement provides that, except for
competitively sensitive information or government "classified" information or
as limited by applicable law or the terms of any confidentiality agreement or
provision in effect on the date of the Merger Agreement, the Company will and
will cause each of its subsidiaries to afford to Alcoa's representatives
reasonable access during normal business hours upon reasonable notice,
throughout the period prior to the earlier of the Effective Time or the
termination of the
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Merger Agreement, to its properties, offices, facilities, employees,
contracts, commitments, books and records and any report, schedule or other
document filed or received by it pursuant to the requirements of federal or
state securities laws and will and will cause each of its subsidiaries to
furnish to Alcoa such additional financial and operating data and tax and
other information as to its and its subsidiaries' respective businesses and
properties as Alcoa may from time to time reasonably request. The Merger
Agreement further provides that Alcoa will hold any information provided under
this covenant that is non-public in confidence to the extent required by, and
in accordance with, the provisions of the December 2, 1999 confidentiality
agreement between Alcoa and the Company.
Reasonable Best Efforts. The Merger Agreement provides that subject to the
terms and conditions of the Merger Agreement and applicable law, each of
Alcoa, the Purchaser and the Company will act in good faith and use reasonable
best efforts to take, or cause to be taken, all actions, and to do, or cause
to be done, all things necessary, proper or advisable to consummate and make
effective the transactions contemplated by the Merger Agreement as soon as
practicable. Alcoa, the Purchaser and the Company have agreed to (and to cause
their respective subsidiaries, and to use reasonable best efforts to cause
their respective affiliates, directors, officers, employees, agents,
attorneys, accountants and representatives, to) do the following:
(i) consult and cooperate with and provide assistance to each other in the
preparation and filing of certain documents with the SEC;
(ii) obtain all consents, approvals, waivers, licenses, permits,
authorizations, registrations, qualifications or other permissions or
actions by, and give all necessary notices to, and make all filings with
and applications and submissions to, any governmental entity or other
person necessary in connection with the consummation of the transactions
contemplated by the Merger Agreement as soon as reasonably practicable;
(iii) provide all such information concerning Alcoa, the Company, their
respective subsidiaries and their respective officers, directors,
employees, partners and affiliates as may be necessary or reasonably
requested in connection with any of the foregoing;
(iv) avoid the entry of, or have vacated or terminated, any decree, order,
or judgment that would restrain, prevent, or delay the consummation of the
Offer or the Merger, including but not limited to defending through
litigation on the merits any claim asserted in any court by any person;
(v) take any and all reasonable steps necessary to avoid or eliminate every
impediment under any antitrust, competition, or trade regulation law that
is asserted by any governmental entity with respect to the Offer or the
Merger so as to enable the consummation of the Offer or the Merger to occur
as expeditiously as possible; and
(vi) divest such plants, assets or businesses of the Company or any of its
subsidiaries (including entering into customary ancillary agreements on
commercially reasonable terms relating to any such divestiture of such
assets or businesses) as may be required in order to avoid the filing of a
lawsuit by any governmental entity seeking to enjoin the purchase of Shares
pursuant to the Offer or the consummation of the Merger, or the entry of,
or to effect the dissolution of, any injunction, temporary restraining
order, or other order in any suit or proceeding, which would otherwise have
the effect of preventing or delaying the purchase of Shares pursuant to the
Offer or the consummation of the Merger; provided, however, that Alcoa will
not be required to take any actions in connection with, or agree to, any
hold separate order, sale, divestiture, or disposition of plants, assets
and businesses of (x) Alcoa or any of its subsidiaries or (y) of the
Company or any of its subsidiaries that accounted in the aggregate for more
than $60 million in revenues in the Company's 1999 fiscal year. At the
request of Alcoa, the Company shall agree to divest, hold separate or
otherwise take or commit to take any action that limits its freedom of
action with respect to, or its ability to retain, any of the businesses,
product lines or assets of the Company or any of its subsidiaries, provided
that any such action shall be conditioned upon the consummation of the
purchase of Shares in the Offer.
The Merger Agreement also provides that the Company, Alcoa and the Purchaser
will keep the other reasonably apprised of the status of matters relating to
completion of the transactions contemplated thereby,
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including promptly furnishing the other with copies of notices or other
communications received by Alcoa, the Purchaser or the Company, as the case
may be, or any of their respective subsidiaries, from any third party and/or
any governmental entity with respect to the transactions contemplated by the
Merger Agreement.
Employee Stock Options and Other Employee Benefits. The Merger Agreement
provides that the Company will use its reasonable best efforts to cause each
outstanding option to purchase shares of Common Stock (including any related
alternative rights) granted under any stock option or compensation plan or
arrangement of the Company or its subsidiaries (collectively, the "Company
Option Plans") (including those granted to current or former employees and
directors of the Company or any of its subsidiaries) (the "Employee Stock
Options") to become exercisable, and each restricted Share granted under the
Company Option Plans, to vest in full and become fully transferable and free
of restrictions, either prior to the purchase of the Shares pursuant to the
Offer or immediately prior to the Effective Time, as permitted pursuant to the
terms and conditions of the applicable Company Option Plan. The Merger
Agreement provides that the Company will offer to each holder of an Employee
Stock Option that is outstanding immediately prior to the first purchase of
Shares pursuant to the Offer (the "Purchase Date") to cancel such Employee
Stock Option in exchange for an amount in cash equal to the product of (x) the
difference between the Offer Price and the per share exercise price of such
Employee Stock Option and (y) the number of shares of Common Stock covered by
such Employee Stock Option. The Merger Agreement also provides that all
payments in respect of such Employee Stock Options will be made as promptly as
practicable after the Purchase Date, subject to the collection of all
applicable withholding taxes required by law to be collected by the Company.
Each Employee Stock Option, the holder of which does not accept such offer,
that remains outstanding immediately before the Effective Time will be assumed
by Alcoa and converted, effective as of the Effective Time, into an option
with respect to that number (the "New Share Number") of shares of common
stock, par value $1.00 per share, of Alcoa ("Alcoa Common Stock") that equals
the number of Shares subject to such Employee Stock Option immediately before
the Effective Time, times an amount equal to the Merger Consideration divided
by the Alcoa Share Value (as defined below), rounded to the nearest whole
number, with a per-share exercise price equal to the aggregate exercise price
of such option immediately before the Effective Time, divided by the New Share
Number, rounded to the nearest whole cent; provided, that in the case of any
such option that was granted as an "incentive stock option" within the meaning
of Section 422 of the Code and did not cease to qualify as such as a result of
any acceleration of vesting provided for above or otherwise, the number of
shares will be rounded down to the nearest whole number to determine the New
Share Number, and the new per-share exercise price will be determined by
rounding up to the nearest whole cent. The "Alcoa Share Value" means the
average of the daily high and low trading prices of the Alcoa Common Stock on
the NYSE on each trading day during the period of 30 days ending the second
trading day prior to the Effective Time.
Pursuant to the Merger Agreement Alcoa has also agreed (1) from the Purchase
Date through and including December 31, 2001 to, or to cause the Company or
the Surviving Corporation to, maintain employee benefit plans, programs and
arrangements for continuing employees that are no less favorable in the
aggregate than those provided by the Company and its subsidiaries as of the
Purchase Date; (2) to recognize time served with the Company or any of its
subsidiaries for determining (x) eligibility, vesting and levels of benefits
under benefit plans of Alcoa or its subsidiaries, including the Surviving
Corporation (but not for level of benefit accrual under any defined benefit
plans) and (y) severance payments; (3) for the period through and including
December 31, 2001, to provide the Company's Employees (defined in the Merger
Agreement as those persons who are employees or former employees of the
Company or its subsidiaries immediately prior to the Purchase Date) whose
employment is terminated following the Purchase Date with severance benefits
on terms and conditions and in amounts that are not less favorable than those
provided under the Company Severance Pay Plan; and (4) to honor certain
agreements and change-of-control payments and benefits.
No Solicitation. The Merger Agreement provides that neither the Company nor
any of its subsidiaries nor any of the officers and directors of any of them
will, and the Company will direct and use its reasonable best efforts to cause
its and its subsidiaries' employees, agents and representatives, including any
investment banker, attorney or accountant retained by it or any of its
subsidiaries not to, directly or indirectly through another person, (1)
initiate, solicit, encourage or otherwise knowingly facilitate any inquiry,
proposal or offer from any person
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that constitutes an Acquisition Proposal or (2) participate in any discussions
or negotiations regarding an Acquisition Proposal; provided, however, that the
Company Board may, or may authorize the Company, its subsidiaries and their
respective officers, directors, employees, agents and representatives to, in
response to an Acquisition Proposal that the Company Board concludes in good
faith is an Incipient Superior Proposal, (x) furnish information with respect
to the Company and its subsidiaries to any person making such Acquisition
Proposal pursuant to a confidentiality agreement and (y) participate in
discussions or negotiations regarding such Acquisition Proposal, provided
that, prior to taking any such action, the Company provides reasonable advance
notice to Alcoa that it is taking such action.
The term "Acquisition Proposal" is defined in the Merger Agreement to mean
any direct or indirect inquiry, proposal or offer (or any improvement,
restatement, amendment, renewal or reiteration thereof) relating to the
acquisition or purchase of a business or shares of any class of equity
securities of the Company or any of its subsidiaries, any tender offer or
exchange offer that, if consummated, would result in any person beneficially
owning any class of equity securities of the Company or any of its
subsidiaries, or any merger, reorganization, share exchange, consolidation,
business combination, recapitalization, liquidation, dissolution or similar
transaction (a "Business Combination Transaction") involving the Company or
any of its subsidiaries, or any purchase or sale of a substantial portion of
the consolidated assets (including without limitation stock of subsidiaries
owned directly or indirectly by the Company) of the Company or any of its
subsidiaries (an "Asset Transaction"), other than the transactions
contemplated by the Merger Agreement or certain other transactions permitted
by the Merger Agreement, including discussions and negotiations among the
Company and its subsidiaries and discussions with Alcoa relating to the
acquisition of the publicly held shares of Howmet. The term "Incipient
Superior Proposal" is defined in the Merger Agreement to mean an unsolicited
bona fide written Acquisition Proposal that the Company Board concludes in
good faith (after consultation with the Company's financial advisor) would, if
consummated, provide greater aggregate value to the Company's stockholders
from a financial point of view than the transactions contemplated by the
Merger Agreement, provided that for purposes of this definition the term
"Acquisition Proposal" shall have the meaning set forth above, except that (x)
references to "shares of any class of equity securities of the Company" shall
be deemed to be references to "100% of the outstanding Shares" and (y) an
"Acquisition Proposal" shall be deemed to refer only to a Business Combination
Transaction involving the Company or, with respect to an Asset Transaction,
such transaction must involve the assets of the Company and its subsidiaries,
taken as a whole, and not any subsidiary of the Company alone.
The Merger Agreement provides that neither the Company Board nor any
committee thereof shall (i) withdraw, modify or change, or propose publicly to
withdraw, modify or change, in a manner adverse to Alcoa, the recommendation
by the Company Board or such committee of the Offer, the Merger or the Merger
Agreement unless the Company Board shall have determined in good faith, after
consultation with its financial advisor, that the Offer, the Merger or the
Merger Agreement is no longer in the best interests of the Company's
stockholders and that such withdrawal, modification or change is, therefore,
required in order to satisfy its fiduciary duties to the Company's
stockholders under applicable law, (ii) approve or recommend, or propose
publicly to approve or recommend, any Acquisition Proposal, or (iii) cause the
Company to enter into any letter of intent, agreement in principle,
acquisition agreement or other similar agreement (each, an "Acquisition
Agreement") related to any Acquisition Proposal. Notwithstanding the
foregoing, the Company may, in response to a Superior Proposal, (1) withdraw,
modify or change or propose publicly to withdraw, modify or change in a manner
adverse to Alcoa its recommendation of the Offer, the Merger or the Merger
Agreement, (2) approve or recommend, or propose publicly to approve or
recommend, any Acquisition Proposal or (3) so long as the Company is not in
breach of its obligations described in this "No Solicitation" section,
terminate the Merger Agreement, but only after the third business day
following Alcoa's receipt of written notice advising Alcoa that the Company
Board is prepared to accept an Acquisition Proposal and attaching the most
current version of any such Acquisition Proposal or any draft of an
Acquisition Agreement. The term "Superior Proposal" is defined in the Merger
Agreement to mean an Incipient Superior Proposal for which any required
financing is committed or which, in the good faith judgment of the Company
Board, is capable of being financed by the person making the Acquisition
Proposal.
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The Merger Agreement also provides that the Company agrees to promptly (but
in any event within one business day) notify Alcoa orally and in writing of
any Acquisition Proposal or any inquiry regarding the making of any
Acquisition Proposal.
Indemnification; Insurance. The Merger Agreement provides that from and
after the Purchase Date, Alcoa will indemnify and hold harmless each present
and former director and officer of the Company and its subsidiaries against
any costs or expenses (including attorneys' fees), judgments, fines, losses,
claims, damages or liabilities incurred in connection with any claim, action,
suit, proceeding or investigation, whether civil, criminal, administrative or
investigative, by reason of the fact that such individual is or was a
director, officer, employee or agent of the Company or any of its
subsidiaries, or is or was serving at the request of the Company or any of its
subsidiaries as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, arising out of or
pertaining to matters existing or occurring at or prior to the Effective Time,
whether asserted or claimed prior to, at or after the purchase of Shares in
the Offer, to the fullest extent permitted under applicable law, and Alcoa
will also advance fees and expenses as incurred to the fullest extent
permitted under applicable law.
The Merger Agreement provides that the Certificate of Incorporation of the
Company will, from and after the Purchase Date, and the Certificate of
Incorporation of the Surviving Corporation will, from and after the Effective
Time, contain provisions no less favorable with respect to indemnification
than are set forth as of the date of the Merger Agreement in the Certificate
of Incorporation of the Company, which provisions shall not be amended,
repealed or otherwise modified for a period of six years from the Purchase
Date in any manner that would adversely affect the rights thereunder of
individuals who at the Purchase Date were directors, officers or employees of
the Company; provided that this provision shall not limit Alcoa's ability to
merge the Company into Alcoa or any of its subsidiaries or otherwise eliminate
the Company's corporate existence.
The Merger Agreement further provides that, for six years from the Effective
Time, Alcoa will maintain in effect the Company's and its subsidiaries'
current directors' and officers' liability insurance policies (the "Policies")
covering those persons who are currently covered by the Policies; provided,
however, that in no event shall Alcoa be required to expend in any one year an
amount in excess of the annual premiums currently paid by the Company and its
subsidiaries for such insurance, and, provided, further, that if the annual
premiums of such insurance coverage exceed such amount, Alcoa shall be
obligated to obtain policies with the greatest coverage available for a cost
not exceeding such amount; and provided, further, that Alcoa may meet its
obligations under this paragraph by covering the above persons under Alcoa's
insurance policy on the terms described above that expressly provide coverage
for any acts that are covered by the existing policies of the Company and its
subsidiaries.
Howmet Acquisition. The Merger Agreement provides that nothing therein will
prevent Alcoa or any affiliate of Alcoa from offering to acquire or agreeing
with Howmet to acquire all of the Publicly Held Howmet Shares in accordance
with the terms of the Corporate Agreement, dated as of December 2, 1997, by
and among the Company, Cordant Technologies Holding Company and Howmet, as
amended; provided, however, Alcoa agrees that it will not acquire any shares
of Howmet Common Stock prior to the Purchaser's purchase of Shares pursuant to
the Offer.
Conditions to the Merger. The Merger Agreement provides that the obligations
of Alcoa, the Purchaser and the Company to consummate the Merger are subject
to the satisfaction of the following conditions at or prior to the Effective
Time:
(1) if required by the DGCL, the approval of the Merger Agreement by the
stockholders of the Company in accordance with such law;
(2) no statute, rule, regulation, executive order, decree, ruling or
permanent injunction shall have been enacted, entered, promulgated or
enforced by any Governmental Entity that prohibits the consummation of
the Merger substantially on the terms contemplated by the Merger
Agreement or has the effect of making Alcoa or the Purchaser's
acquisition of Shares illegal;
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(3) Alcoa or the Purchaser shall have purchased Shares pursuant to the
Offer, except that this condition shall not be a condition to Alcoa's
and the Purchaser's obligation to effect the Merger if Alcoa or the
Purchaser shall have failed to purchase Shares pursuant to the Offer in
breach of its obligations under the Merger Agreement; and
(4) the applicable waiting period under the HSR Act shall have expired or
been terminated.
Termination. The Merger Agreement may be terminated at any time prior to the
Effective Time:
(1) by the mutual written consent of the Company (including, from and after
the Purchase Date, only with the concurrence of a majority of the
directors of the Company then in office who neither were designated by
Alcoa nor are employees of the Company), Alcoa and the Purchaser;
(2) by either Alcoa or the Company if (a) (i) the Offer shall have expired
without any Shares being purchased pursuant thereto, or (ii) the Offer
has not been consummated on or before September 30, 2000, so long as
the terminating party is not the cause of the failure to purchase
shares pursuant to the Offer; (b) a law prohibits the consummation of
the Offer or the Merger substantially on the terms contemplated by the
Merger Agreement; or (c) a final and non-appealable order, decree,
ruling or injunction has been entered permanently restraining,
enjoining or otherwise prohibiting the consummation of the Offer or the
Merger substantially on the terms contemplated by the Merger Agreement,
so long as the terminating party shall have used its reasonable best
efforts to remove such order, decree, ruling or injunction and is not
in breach of its obligations described above under "Reasonable Best
Efforts;"
(3) by Alcoa if due to an occurrence or circumstance, other than as a
result of a breach by Alcoa or the Purchaser of its obligations under
the Merger Agreement or under the Offer, resulting in a failure to
satisfy any condition to the Offer, the Purchaser shall have (a) failed
to commence the Offer within 30 days following the date of the Merger
Agreement or (b) terminated the Offer without having accepted any
Shares for payment thereunder;
(4) by the Company, upon approval by the Company Board, if the Purchaser
shall have terminated the Offer without having accepted any Shares for
payment thereunder, other than as a result of a breach by the Company
of its obligations under the Merger Agreement that would result in a
failure to satisfy any of the conditions to the Offer; or
(5) by the Company, in accordance with the Merger Agreement, in response to
a Superior Proposal, provided that such termination shall not be
effective unless and until the Company shall have paid to Alcoa the fee
described below.
If the Merger Agreement is terminated, there shall be no other liability
(other than with respect to termination fees and confidentiality) on the part
of Alcoa, the Purchaser or the Company or their respective officers or
directors except liability arising out of a willful breach of the Merger
Agreement. In the event of termination of the Merger Agreement prior to the
expiration of the Offer, Alcoa and the Purchaser will promptly terminate the
Offer without the purchase of Shares thereunder.
Fee and Expenses. Except as otherwise specified below, all fees and expenses
incurred in connection with the Merger Agreement and the transactions
contemplated thereby will be paid by the party incurring such expenses,
whether or not the Offer or the Merger is consummated.
In the event that the Merger Agreement shall have been terminated pursuant
to paragraph (3) under "--Termination" above as a result of the failure of the
condition set forth in paragraph (e) of Section 15 below or pursuant to
paragraph (5) under "Termination" above, the Company will immediately pay
Alcoa a fee equal to $75 million (the "Termination Fee"), payable by wire
transfer of immediately available funds, the receipt of which by Alcoa in the
case of termination pursuant to paragraph (5) under "--Termination" above
shall be a condition to the effectiveness of such termination.
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Amendment. At any time prior to the Effective Time, the Merger Agreement may
be amended by written agreement of the parties thereto; provided, however,
that after adoption of the Merger Agreement by stockholders of the Company,
there shall be no amendment or change to the Merger Agreement that would
reduce the amount or change the type of consideration into which each Share
shall be converted upon consummation of the Merger or other change requiring
stockholder approval without further approval by the stockholders of the
Company.
Letter Agreement Relating to Alcoa's Compliance with the Company's Corporate
Agreement
On March 13, 2000, the Company and Howmet amended the Corporate Agreement,
dated December 2, 1997, by and among the Company, Cordant Technologies Holding
Company and Howmet (the "Corporate Agreement"), relating to the Company's
ownership of Howmet Common Stock. Under the amended Corporate Agreement, the
Company has agreed not to acquire shares of Howmet Common Stock if it would
reduce the number of Publicly Held Howmet Shares below 14% of the outstanding
shares unless (1) the acquisition is approved by the Howmet Special Committee,
(2) the acquisition is accomplished by a tender offer for all of the Publicly
Held Howmet Shares that is conditioned upon the tender of a majority of the
Publicly Held Howmet Shares, with a merger following on the same terms or (3)
the acquisition is accomplished by a merger that has been approved by the
affirmative vote of a majority of the Publicly Held Howmet Shares. A copy of
the amendment to the Corporate Agreement is filed as an exhibit to the
Schedule TO and is incorporated herein by reference.
Alcoa has separately agreed with Howmet to be bound by the same limitations
as the Company under the Corporate Agreement. These arrangements were approved
by the Board of Directors of Howmet with the recommendation and concurrence of
the Howmet Special Committee. The Howmet Special Committee also approved
Alcoa's becoming an "interested stockholder" of Howmet under Section 203 of
the DGCL as a result of the Merger Agreement. A copy of the letter agreement
between Alcoa and Howmet, pursuant to which Alcoa agreed to be bound is filed
as an exhibit to the Schedule TO and is incorporated herein by reference.
12. Purpose of the Offer; Plans for the Company.
Purpose of the Offer. The purpose of the Offer is to acquire control of, and
the entire equity interest in, the Company. The purpose of the Merger is to
acquire all outstanding Shares not tendered and purchased pursuant to the
Offer. If the Offer is successful, the Purchaser intends to consummate the
Merger as promptly as practicable.
The Company Board has approved the Merger and the Merger Agreement.
Depending upon the number of Shares purchased by the Purchaser pursuant to the
Offer, the Company Board may be required to submit the Merger Agreement to the
Company's stockholders for approval at a stockholder's meeting convened for
that purpose in accordance with the DGCL. If stockholder approval is required,
the Merger Agreement must be approved by a majority of all votes entitled to
be cast at such meeting.
If the Minimum Condition is satisfied, the Purchaser will have sufficient
voting power to approve the Merger Agreement at the stockholders' meeting
without the affirmative vote of any other stockholder. If the Purchaser
acquires at least 90% of the then outstanding Shares pursuant to the Offer,
the Merger may be consummated without a stockholder meeting and without the
approval of the Company's stockholders. The Merger Agreement provides that the
Purchaser will be merged into the Company and that the certificate of
incorporation and bylaws of the Purchaser will be the certificate of
incorporation and bylaws of the Surviving Corporation following the Merger;
provided that, at the Effective Time, such certificate of incorporation shall
be amended to provide that the name of the corporation shall be "Cordant
Technologies Inc."
Under the DGCL, holders of Shares do not have dissenters' rights as a result
of the Offer. In connection with the Merger, however, stockholders of the
Company may have the right to dissent and demand appraisal of their Shares
under the DGCL. Dissenting stockholders who comply with the applicable
statutory procedures under the DGCL will be entitled to receive a judicial
determination of the fair value of their Shares (exclusive of any element of
value arising from the accomplishment or expectation of the Merger) and to
receive payment of
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such fair value in cash. Any such judicial determination of the fair value of
the Shares could be based upon considerations other than or in addition to the
price per Share paid in the Merger and the market value of the Shares. In
Weinberger v. UOP, Inc., the Delaware Supreme Court stated, among other
things, that "proof of value by any techniques or methods which are generally
considered acceptable in the financial community and otherwise admissible in
court" should be considered in an appraisal proceeding. Stockholders should
recognize that the value so determined could be higher or lower than the price
per Share paid pursuant to the Offer or the consideration per Share to be paid
in the Merger. Moreover, the Purchaser may argue in an appraisal proceeding
that, for purposes of such a proceeding, the fair value of the Shares is less
than the price paid in the Offer or the Merger.
Plans for the Company. Pursuant to the terms of the Merger Agreement,
promptly upon the purchase of and payment for any Shares by the Purchaser
pursuant to the Offer, Alcoa currently intends to seek maximum representation
on the Company Board, subject to the requirement in the Merger Agreement that
if Shares are purchased pursuant to the Offer, there shall be until the
Effective Time at least two members of the Company Board who were directors as
of the date of the Merger Agreement and who are not employees of the Company.
The Purchaser currently intends, as soon as practicable after consummation of
the Offer, to consummate the Merger.
Except as otherwise provided herein, it is expected that, initially
following the Merger, the business and operations of the Company will, except
as set forth in this Offer to Purchase, be continued substantially as they are
currently being conducted. Alcoa will continue to evaluate the business and
operations of the Company during the pendency of the Offer and after the
consummation of the Offer and the Merger and will take such actions as it
deems appropriate under the circumstances then existing. Alcoa intends to seek
additional information about the Company during this period. Thereafter, Alcoa
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 development of the Company's potential in conjunction with Alcoa's
business.
Alcoa has advised Howmet that it intends, promptly after the commencement of
the Offer to enter into discussions with the committee of independent
directors of Howmet to pursue the acquisition of the Publicly Held Howmet
Shares. Alcoa has agreed with Howmet to be bound by the terms of the amended
Corporate Agreement for so long as the Merger Agreement is in effect, to the
same extent as the Company. The Merger Agreement provides that nothing in the
Merger Agreement prevents Alcoa or any affiliate of Alcoa from offering to
acquire or agreeing with Howmet to acquire all of the shares of Howmet Common
Stock not owned by the Company or any of its subsidiaries in accordance with
the Corporate Agreement; provided that Alcoa has agreed that it will not
acquire any shares of Howmet Common Stock prior to the Purchaser's purchase of
Shares in the Offer.
Except as described above or elsewhere in this Offer to Purchase, the
Purchaser and Alcoa have no present plans or proposals that would relate to or
result in (i) any extraordinary corporate transaction involving the Company or
any of its subsidiaries (such as a merger, reorganization, liquidation,
relocation of any operations or sale or other transfer of a material amount of
assets), (ii) any sale or transfer of a material amount of assets of the
Company or any of its subsidiaries, (iii) any change in the Company Board or
management of the Company, (iv) any material change in the Company's
capitalization or dividend policy, (v) any other material change in the
Company's corporate structure or business, (vi) a class of securities of the
Company being delisted from a national securities exchange or ceasing to be
authorized to be quoted in an inter-dealer quotation system of a registered
national securities association or (vii) a class of equity securities of the
Company being eligible for termination of registration pursuant to Section
12(g) of the Exchange Act.
13. Certain Effects of the Offer
Market for the Shares. The purchase of Shares pursuant to the Offer will
reduce the number of holders of Shares and the number of Shares that might
otherwise trade publicly, which could adversely affect the liquidity and
market value of the remaining Shares held by stockholders other than the
Purchaser. The Purchaser cannot
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predict whether the reduction in the number of Shares that might otherwise
trade publicly would have an adverse or beneficial effect on the market price
for, or marketability of, the Shares or whether such reduction would cause
future market prices to be greater or less than the Offer Price.
Stock Quotation. 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 the NYSE's published guidelines, the NYSE would
consider delisting the Shares if, among other things, the number of publicly
held Shares falls below 600,000, the number of record holders of at least 100
Shares falls below 400 (or below 1,200 if the average monthly trading volume
is below 100,000 for the last twelve months) or the aggregate market value of
such publicly held Shares falls below $8,000,000. Shares held by officers or
directors of the Company or their immediate families, or by any beneficial
owner of 10% or more of the Shares, ordinarily will not be considered to be
publicly held for this purpose.
If, as a result of the purchase of Shares pursuant to the Offer or
otherwise, the Shares no longer meet the requirements of the NYSE for
continued listing and the listing of the Shares is discontinued, the market
for the Shares could be adversely affected.
If the NYSE were to delist the Shares, it is possible that the Shares would
continue to trade on another securities exchange or in the over-the-counter
market and that price or other quotations would be reported by such exchange
or through the Nasdaq National Market or through other sources. The extent of
the public market for such Shares and the availability of such quotations
would depend, however, upon such factors as the number of stockholders and/or
the aggregate market value of such securities remaining at such time, the
interest in maintaining a market in the Shares on the part of securities
firms, the possible termination of registration under the Exchange Act as
described below and other factors.
Margin Regulations. The Shares are currently "margin securities" under the
Regulations 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 the Shares. Depending
upon factors similar to those described above regarding the market for the
Shares and stock quotations, it is possible that, following the Offer, the
Shares would no longer constitute "margin securities" for the purposes of the
margin regulations of the Federal Reserve Board and therefore could no longer
be used as collateral for loans made by brokers.
Exchange Act Registration. The Shares are currently registered under the
Exchange Act. Such registration may be terminated upon application of the
Company to the SEC if the Shares are neither listed on a national securities
exchange nor held by 300 or more holders of record. Termination of
registration of the Shares under the Exchange Act would substantially reduce
the information required to be furnished by the Company to its stockholders
and to the SEC and would make certain provisions of the Exchange Act no longer
applicable to the Company, such as the short-swing profit recovery provisions
of Section 16(b) of the Exchange Act, the requirement of furnishing a proxy
statement pursuant to Section 14(a) of the Exchange Act in connection with
stockholders' meetings and the related requirement of furnishing an annual
report to stockholders and the requirements of Rule 13e-3 under the Exchange
Act with respect to "going private" transactions. Furthermore, the ability of
"affiliates" of the Company and persons holding "restricted securities" of the
Company to dispose of such securities pursuant to Rule 144 promulgated under
the Securities Act of 1933, as amended, may be impaired or eliminated. If
registration of the Shares under the Exchange Act were terminated, the Shares
would no longer be "margin securities" or be eligible for trading on the NYSE.
Alcoa and the Purchaser currently intend 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.
14. Dividends and Distributions.
As discussed in Section 11, the Merger Agreement provides that from the date
of the Merger Agreement to the Effective Time, without the prior written
approval of Alcoa, the Company will not and will not permit any of its
subsidiaries to repatriate funds, authorize or pay any dividends on or make
any distribution with respect to its
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outstanding shares of capital stock (other than (a) regularly quarterly cash
dividends by the Company in an amount not to exceed $0.10 per Share per
quarter declared and paid in accordance with past practice, including
establishment of record and payment dates, and (b) dividends or distributions
by wholly owned subsidiaries of the Company).
15. Certain Conditions of the Offer.
Notwithstanding any other provision of the Offer, the Purchaser shall not be
required to accept for payment or, subject to any applicable rules and
regulations of the SEC, including Rule 14e-1(c) promulgated under the Exchange
Act (relating to the Purchaser's obligation to pay for or return Shares
promptly after termination or withdrawal of the Offer), pay for, and may
postpone the acceptance for payment of and payment for Shares tendered, and,
except as set forth in the Merger Agreement, terminate the Offer as to any
Shares not then paid for if (i) the Minimum Condition shall not have been
satisfied at the Expiration Date, (ii) any applicable waiting period under the
HSR Act shall not have expired or been terminated, the notification of and
approval by the European Commission under the EU Council Regulation 4064/89,
as amended (the "EU Regulation"), shall not have been received or the
applicable waiting period under the Canadian Competition Act (the "Competition
Act") shall not have expired, in each case to the extent applicable to the
purchase of Shares in the Offer, or (iii) immediately prior to the expiration
of the Offer, any of the following conditions shall exist:
(a) there shall have been entered, enforced or issued by any federal,
regional, state or local court, arbitrator, tribunal, administrative
agency, whether U.S. or foreign (a "Governmental Entity"), any
judgment, order, injunction or decree (i) which makes illegal,
restrains or prohibits or makes materially more costly the making of
the Offer, the acceptance for payment of, or payment for, any Shares by
Alcoa, the Purchaser or any other affiliate of Alcoa, or the
consummation of the Merger transaction; (ii) which prohibits or limits
materially the ownership or operation by the Company, Alcoa or any of
their subsidiaries of all or any material portion of the business or
assets of the Company, Alcoa or any of their subsidiaries, or compels
the Company, Alcoa or any of their Subsidiaries to dispose of or hold
separate all or any portion of the business or assets of the Company,
Alcoa or any of their Subsidiaries; (iii) which imposes or confirms
limitations on the ability of Alcoa, the Purchaser or any other
affiliate of Alcoa to exercise full rights of ownership of any Shares,
including, without limitation, the right to vote any Shares acquired by
the Purchaser pursuant to the Offer or otherwise on all matters
properly presented to the Company's stockholders, including, without
limitation, the approval and adoption of the Merger Agreement and the
transactions contemplated by the Merger Agreement; (iv) which requires
divestiture by Alcoa, the Purchaser or any other affiliate of Alcoa of
any Shares; or (v) which otherwise would have a Material Adverse Effect
on the Company to the extent that it relates to or arises out of the
transactions contemplated by the Merger Agreement or Alcoa, except in
the case of clauses (i) through (v), where such events are consistent
with or result from Alcoa's, the Purchaser's and the Company's
obligations described under "The Merger Agreement--Reasonable Best
Efforts" in Section 11;
(b) there shall have been any statute, rule, regulation, legislation or
interpretation enacted, enforced, promulgated, amended or issued by any
Governmental Entity or deemed by any Governmental Entity applicable to
(i) Alcoa, the Company or any subsidiary or affiliate of Alcoa or the
Company or (ii) any transaction contemplated by the Merger Agreement,
other than the HSR Act, the EU Regulation and the Competition Act,
which is reasonably likely to result, directly or indirectly, in any of
the consequences referred to in clauses (i) through (v) of paragraph
(a) above, except where such events are consistent with or result from
Alcoa's, the Purchaser's and the Company's obligations described under
"The Merger Agreement--Reasonable Best Efforts" in Section 11;
(c) there shall have occurred any changes, conditions, events or
developments that would have, or be reasonably likely to have,
individually or in the aggregate, a Material Adverse Effect on the
Company;
(d) there shall have occurred (i) any general suspension of, or limitation
on prices for, trading in securities on the NYSE 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
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moratorium or any suspension of payments in respect of banks in the
United States, (iii) any limitation (whether or not mandatory) on the
extension of credit by banks or other lending institutions in the United
States, (iv) the commencement of a war, material armed hostilities or
any other material international or national calamity involving the
United States or (v) in the case of any of the foregoing existing at the
time of the commencement of the Offer, a material acceleration or
worsening thereof;
(e) (i) it shall have been publicly disclosed or the Purchaser shall have
otherwise learned that any individual, corporation, partnership,
association, trust or any other entity or organization, other than
Alcoa or any of its affiliates, shall have acquired or entered into a
definitive agreement or agreement in principle to acquire beneficial
ownership (determined for the purposes of this paragraph as set forth
in Rule 13d-3 promulgated under the Exchange Act) of the then
outstanding Shares, or shall have been granted any option, right or
warrant, conditional or otherwise, to acquire beneficial ownership of
50% or more of the then outstanding Shares, or (ii) the Company Board
or any committee thereof shall have (A) withdrawn, modified or changed,
in a manner adverse to Alcoa or the Purchaser, the recommendation by
such Company Board or such committee of the Offer, the Merger or the
Merger Agreement, (B) approved or recommended, or proposed publicly to
approve or recommend an Acquisition Proposal, (C) caused the Company to
enter into any Acquisition Agreement, relating to any Acquisition
Proposal, or (D) resolved to do any of the foregoing;
(f) the representations or warranties of the Company set forth in the
Merger Agreement that are qualified by materiality or Material Adverse
Effect shall not be true and correct, or the representations and
warranties of the Company set forth in the Merger Agreement that are
not so qualified shall not be true and correct in all material
respects, in each case, as if such representations or warranties were
made as of such time on or after the date of the Merger Agreement
(except to the extent such representations and warranties speak as of a
specific date or as of the date of the Merger Agreement, in which case
such representations and warranties shall not be so true and correct or
true and correct in all material respects, as the case may be, as of
such specific date or as of the date of the Merger Agreement,
respectively);
(g) the Company shall have failed to perform in any material respect any
material obligation or to comply in any material respect with any
material agreement or covenant of the Company to be performed or
complied with by it under the Merger Agreement;
(h) the Merger Agreement shall have been terminated in accordance with its
terms; or
(i) the Purchaser and the Company shall have agreed that the Purchaser
shall terminate the Offer or postpone the acceptance for payment of or
payment for Shares thereunder;
which, in the reasonable good faith judgment of the Purchaser in any such
case, and regardless of the circumstances (including any action or inaction by
Alcoa or any of its affiliates) giving rise to any such condition, makes it
inadvisable to proceed with such acceptance for payment or payment.
Except as expressly set forth in the Merger Agreement, the foregoing
conditions are for the benefit of the Purchaser and Alcoa and may be asserted
by the Purchaser or Alcoa regardless of the circumstances giving rise to any
such condition or may be waived by the Purchaser or Alcoa in whole or in part
at any time and from time to time in their reasonable discretion. The failure
by Alcoa or the 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.
16. Certain Legal Matters; Regulatory Approvals.
General. The Purchaser is not aware of any pending legal proceeding relating
to the Offer. Except as described in this Section 16, based on its examination
of publicly available information filed by the Company with the SEC and other
publicly available information concerning the Company, the Purchaser is not
aware of
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any governmental license or regulatory permit that appears to be material to
the Company's business that might be adversely affected by the Purchaser's
acquisition of Shares as contemplated herein or of any approval or other
action by any governmental, administrative or regulatory authority or agency,
domestic or foreign, that would be required for the acquisition or ownership
of Shares by the Purchaser or Alcoa as contemplated herein. Should any such
approval or other action be required, the Purchaser currently contemplates
that, except as described below under "State Takeover Statutes," such approval
or other action will be sought. While the Purchaser does not currently intend
to delay acceptance for payment of Shares tendered pursuant to the Offer
pending the outcome of any such matter, there can be no assurance that any
such approval or other action, if needed, would be obtained or would be
obtained without substantial conditions or that if such approvals were not
obtained or such other actions were not taken, adverse consequences might not
result to the Company's business, or certain parts of the Company's business
might not have to be disposed of, any of which could cause the Purchaser to
elect to terminate the Offer without the purchase of Shares thereunder under
certain conditions. See Section 15.
State Takeover Statutes. A number of states have adopted laws that purport,
to varying degrees, to apply to attempts to acquire corporations that are
incorporated in, or that have substantial assets, stockholders, principal
executive offices or principal places of business or whose business operations
otherwise have substantial economic effects in, such states. The Company,
directly or through subsidiaries, conducts business in a number of states
throughout the United States, some of which have enacted such laws.
In Edgar v. MITE Corp., the Supreme Court of the United States invalidated
on constitutional grounds the Illinois Business Takeover Statute which, as a
matter of state securities law, made takeovers of corporations meeting certain
requirements more difficult. However, in 1987 in CTS Corp. v. Dynamics Corp.
of America, the Supreme Court held that the State of Indiana could, as a
matter of corporate law, constitutionally disqualify a potential acquiror from
voting shares of a target corporation without the prior approval of the
remaining stockholders where, among other things, the corporation is
incorporated in, and has a substantial number of stockholders in, the state.
Subsequently, in TLX Acquisition Corp. v. Telex Corp., a Federal District
Court in Oklahoma ruled that the Oklahoma statutes were unconstitutional
insofar as they apply to corporations incorporated outside Oklahoma in that
they would subject such corporations to inconsistent regulations. Similarly,
in Tyson Foods, Inc. v. McReynolds, a Federal District Court in Tennessee
ruled that four Tennessee takeover statutes were unconstitutional as applied
to corporations incorporated outside Tennessee. This decision was affirmed by
the United States Court of Appeals for the Sixth Circuit.
The Company is incorporated under the laws of the State of Delaware. In
general, Section 203 of the DGCL ("Section 203") prevents an "interested
stockholder" (including a person who has the right to acquire 15% or more of
the corporation's outstanding voting stock) from engaging in a "business
combination" (defined to include mergers and certain other actions) with a
Delaware corporation for a period of three years following the date such
person became an interested stockholder. The Company Board approved for
purposes of Section 203 the entering into by the Purchaser, Alcoa and the
Company of the Merger Agreement and the consummation of the transactions
contemplated thereby and has taken all appropriate action so that Section 203,
with respect to the Company, will not be applicable to Alcoa and the Purchaser
by virtue of such actions. In addition, the Board of Directors of Howmet
approved for purposes of Section 203 Alcoa and the Purchaser becoming
"interested stockholders" by virtue of Alcoa executing the letter agreement,
dated March 13, 2000 with Howmet and their entering into the Merger Agreement.
If any government official or third party should seek to apply any state
takeover law to the Offer or the Merger or other business combination between
the Purchaser or any of its affiliates and the Company, the Purchaser will
take such action as then appears desirable, which action may include
challenging the applicability or validity of such statute in appropriate court
proceedings. In the event it is asserted that one or more state takeover
statutes is applicable to the Offer or the Merger and an appropriate court
does not determine that it is inapplicable or invalid as applied to the Offer
or the Merger, the Purchaser might be required to file certain information
with, or to receive approvals from, the relevant state authorities or holders
of Shares, and the Purchaser might be unable to accept for payment or pay for
Shares tendered pursuant to the Offer, or be delayed
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in continuing or consummating the Offer or the Merger. In such case, the
Purchaser may not be obligated to accept for payment or pay for any tendered
Shares. See Section 15.
United States Antitrust Compliance. Under the HSR Act and the rules that
have been promulgated thereunder by the Federal Trade Commission (the "FTC"),
certain acquisition transactions may not be consummated unless certain
information has been furnished to the Antitrust Division of the Department of
Justice (the "Antitrust Division") and the FTC and certain waiting period
requirements have been satisfied. The purchase of Shares pursuant to the Offer
is subject to such requirements.
Pursuant to the requirements of the HSR Act, the Purchaser expects to file a
Notification and Report Form with respect to the Offer and Merger with the
Antitrust Division and the FTC on or about March 21, 2000. As a result, the
waiting period applicable to the purchase of Shares pursuant to the Offer is
scheduled to expire at 11:59 p.m., New York City time, 15 days after such
filing. However, prior to such time, the Antitrust Division or the FTC may
extend the waiting period by requesting additional information or documentary
material relevant to the Offer from the Purchaser. If such a request is made,
the waiting period will be extended until 11:59 p.m., New York City time, on
the tenth day after substantial compliance by the Purchaser with such request.
Thereafter, such waiting period can be extended only by court order.
The Antitrust Division and the FTC scrutinize the legality under the
antitrust laws of transactions such as the acquisition of Shares by the
Purchaser pursuant to the Offer. At any time before or after the consummation
of any such transactions, the Antitrust Division or the FTC could take such
action under the antitrust laws of the United States as it deems necessary or
desirable in the public interest, including seeking to enjoin the purchase of
Shares pursuant to the Offer or seeking divestiture of the Shares so acquired
or divestiture of substantial assets of Alcoa or the Company. Private parties
(including individual States) may also bring legal actions under the antitrust
laws of the United States. The Purchaser does not believe that the
consummation of the Offer will result in a violation of any applicable
antitrust laws. However, 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 will be. See Section 15, including conditions with respect to
litigation and certain governmental actions and Section 11 for certain
termination rights and obligations to make certain divestitures.
Canadian Competition Act. The merger provisions of the Competition Act
permit the Commissioner of Competition appointed thereunder (the
"Commissioner") to apply to the Competition Tribunal (the "Tribunal") to seek
relief in respect of a merger which prevents or lessens, or is likely to
prevent or lessen, competition substantially. The relief that may be ordered
by the Tribunal includes, in the case of a completed merger, ordering a
dissolution of the merger or a disposition of assets or shares, and in the
case of a proposed merger, prohibiting or delaying completion of the
transaction.
The Competition Act also requires parties to certain proposed mergers that
exceed specified size thresholds to provide the Commissioner with prior notice
of and information relating to the transaction and the parties thereto, and to
await the expiration or termination of the prescribed waiting period, prior to
completing the transaction. A prescribed notification form can be either
short-form or long-form. The waiting period in respect of a short-form is 14
days and in respect of a long-form filing is 42 days. A party to a proposed
merger may also apply for an advance ruling certificate ("ARC") or some form
of comfort letter, which may be issued by the Commissioner if the Commissioner
is satisfied there would not be sufficient grounds on which to apply to the
Tribunal for an order under the merger provisions in respect of the
transaction. The issuance of an ARC will also terminate the waiting period.
Alcoa and the Company will be filing a short-form notification with the
Commissioner and applying for an ARC or some form of comfort letter.
EEA and European National Merger Regulation. Alcoa and the Company each
conduct substantial operations in the European Economic Area. Council
Regulation (EEC) 4064/89, as amended, and Article 57 of the European Economic
Area Agreement require that concentrations with a "Community or EFTA
dimension" be notified in prescribed form to the Commission of the European
Communities for review and approval. In these
35
<PAGE>
cases, the European Commission, as opposed to the individual countries within
the European Economic Area, will, with certain exceptions, have exclusive
jurisdiction to review the concentration. Approval by the European Commission
is, with certain very limited exceptions, required prior to completion of
transactions, with "Community or EFTA dimensions".
Alcoa and the Company have determined that the Offer and the Merger have a
"community dimension," and thus, intend to file notification in the prescribed
form with the European Commission in accordance with the European Regulation
promptly.
This filing will trigger a one-month review period in which the European
Commission is required to determine whether the proposed merger is compatible
with the European common market or that there is sufficiently "serious doubt"
about the proposed merger's compatibility with the common market to require a
more complete review of the proposed merger.
The one-month review period can be extended to six weeks if the parties
offer undertakings to address certain concerns the European Commission may
have. If after the initial one-month (or six weeks) review period, the
European Commission continues to have serious doubts regarding the
compatibility of the merger with the European common market, the total review
period can be as long as five months from the date of complete notification.
During the review process conditions can be imposed and obligations by the
parties may become necessary.
Other Filings. Alcoa and the Company each conduct operations in a number of
foreign countries, and filings may have to be made with foreign governments
under their pre-merger notification statutes. The filing requirements of
various nations are being analyzed by the parties and, where necessary, such
filings will be made.
17. Dissenters' Rights.
If the Merger is consummated, stockholders of the Company may have the right
to dissent and demand appraisal of their Shares under the DGCL. See Section
12. Under the DGCL, dissenting stockholders who comply with the applicable
statutory procedures will be entitled to receive a judicial determination of
the fair value of their Shares (exclusive of any element of value arising from
the accomplishment or expectation of the Merger) and to receive payment of
such fair value in cash, together with a fair rate of interest, if any. Any
such judicial determination of the fair value of the Shares could be based
upon considerations other than or in addition to the Offer Price, the
consideration per Share to be paid in the Merger and the market value of the
Shares, including asset values and the investment value of the Shares.
Stockholders should recognize that the value so determined could be higher or
lower than the price per Share paid pursuant to the Offer or the consideration
per Share to be paid in the Merger.
18. Fees and Expenses.
Salomon Smith Barney is acting as the Dealer Manager in connection with the
Offer and Alcoa's proposed acquisition of the Company. Salomon Smith Barney
will receive reasonable and customary compensation for its services relating
to the Offer and to be reimbursed for certain out-of-pocket expenses. Alcoa
and the Purchaser will indemnify Salomon Smith Barney and certain related
persons against certain liabilities and expenses in connection with its
engagement, including certain liabilities under the federal securities laws.
Alcoa and the Purchaser have retained Morrow & Co., Inc. to be the
Information Agent and ChaseMellon Shareholder Services, L.L.C. to be the
Depositary in connection with the Offer. The Information Agent may contact
holders of Shares by mail, telephone, telecopy, telegraph and personal
interview and may request banks, brokers, dealers and other nominees to
forward materials relating to the Offer to beneficial owners of Shares.
The Information Agent and the Depositary each will receive reasonable and
customary compensation for their respective services in connection with the
Offer, will be reimbursed for reasonable out-of-pocket expenses and will be
indemnified against certain liabilities and expenses in connection therewith,
including certain liabilities under federal securities laws.
Neither of Alcoa nor the Purchaser will pay any fees or commissions to any
broker or dealer or to any other person (other than to the Dealer Manager, the
Depositary and the Information Agent) in connection with the solicitation of
tenders of Shares pursuant to the Offer. Brokers, dealers, commercial banks
and trust companies
36
<PAGE>
will, upon request, be reimbursed by the Purchaser for customary mailing and
handling expenses incurred by them in forwarding offering materials to their
customers.
19. Miscellaneous.
The Offer is not being made to (nor will tenders be accepted from or on
behalf of) holders of Shares in any jurisdiction in which the making of the
Offer or the acceptance thereof would not be in compliance with the laws of
such jurisdiction. However, the Purchaser may, in its discretion, take such
action as it may deem necessary to make the Offer in any such jurisdiction and
extend the Offer to holders of Shares in such jurisdiction.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION ON BEHALF OF ALCOA OR THE PURCHASER NOT CONTAINED HEREIN OR IN
THE LETTER OF TRANSMITTAL, AND, IF GIVEN OR MADE, SUCH INFORMATION OR
REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED.
The Purchaser has filed with the SEC a Tender Offer Statement on Schedule TO
pursuant to Rule 14d-3 of the General Rules and Regulations under the Exchange
Act, together with exhibits furnishing certain additional information with
respect to the Offer, and may file amendments thereto. In addition, the
Company has filed with the SEC a Solicitation/Recommendation Statement on
Schedule 14D-9, together with exhibits, pursuant to Rule 14d-9 under the
Exchange Act, setting forth the recommendation of the Company Board with
respect to the Offer and the reasons for such recommendation and furnishing
certain additional related information. A copy of such documents, and any
amendments thereto, may be examined at, and copies may be obtained from, the
SEC (but not the regional offices of the SEC) in the manner set forth under
Section 7 above.
Omega Acquisition Corp.
March 20, 2000
37
<PAGE>
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF
ALCOA AND THE PURCHASER
1. Directors and Executive Officers of Alcoa.
The following table sets forth the name, present principal occupation or
employment and material occupations, positions, offices or employments for the
past five years of each director and executive officer of Alcoa. Unless
otherwise indicated, the current business address of each person is 201
Isabella Street, Pittsburgh, Pennsylvania 15212. Unless otherwise indicated,
each such person is a citizen of the United States of America and each
occupation set forth opposite an individual's name refers to employment with
Alcoa.
<TABLE>
<CAPTION>
Present Principal Occupation or
Employment; Material Positions
Name, Age and Business Address Held During the Past Five Years
------------------------------ -------------------------------
<C> <S>
Kenneth W. Dam, 67............. Max Pam Professor of American and Foreign Law,
University of Chicago Law University of Chicago Law School since 1992;
School Director of Council on Foreign Relations and the
5801 South Ellis Avenue Brookings Institution.
Chicago, IL 60637-1496
Joseph T. Gorman, 62........... Chairman and Chief Executive Officer, TRW Inc.
TRW Inc. since 1988; Director of The Procter & Gamble
1900 Richmond Road Company and TRW.
Cleveland, OH 44124-3760
Judith M. Gueron, 58........... President, Manpower Demonstration Research
Manpower Demonstration Corporation since 1986.
Research Corporation
16 East 34th Street
New York, NY 10016-4328
Sir Ronald Hampel, 67.......... Chairman of United News & Media plc since April
United News & Media plc 1999; Chairman, Imperial Chemical Industries PLC
32 Union Square East, 5th (ICI), from 1995 to 1999; Deputy Chairman and
Floor Chief Executive of ICI from 1993 to 1995;
New York, NY 10003-3209 Chairman of the UK Committee on Corporate
Governance; Director of ICI from 1985 to 1999;
Director of BAE Systems PLC and the All England
Lawn Tennis Club (Wimbledon) Limited. Sir Hampel
is a citizen of the United Kingdom.
Hugh M. Morgan, 59............. Managing Director since 1986 and Chief Executive
WMC Limited Officer since 1990 of WMC Limited; Director of
IBM Centre 60 City Road Reserve Bank of Australia and a number of
Southbank Victoria 3006, industry, business, trade and international
Australia associations and advisory groups. Mr. Morgan is a
citizen of Australia.
John P. Mulroney, 64........... (Former) President and Chief Operating Officer,
510 Walnut Street Rohm and Haas Company from 1986 to 1998; Director
Suite 1500 of Rohm and Haas from 1982 to 1998; Director of
Philadelphia, PA 19106 Teradyne, Inc.
Paul H. O'Neill, 64............ Chairman of the Board since 1987; Chief Executive
Officer from 1987 to May 1999; Director of
Eastman Kodak Company, Gerald R. Ford Foundation,
Lucent Technologies Inc., Manpower Demonstration
Research Corporation, National Association of
Securities Dealers, Inc. and The RAND
Corporation.
</TABLE>
I-1
<PAGE>
<TABLE>
<CAPTION>
Present Principal Occupation or
Employment; Material Positions
Name, Age and Business Address Held During the Past Five Years
------------------------------ -------------------------------
<C> <S>
Henry B. Schacht, 65........... Managing Director, E. M. Warburg, Pincus &
E.M. Warburg, Pincus & Co., Co., LLC, since January 2000; Senior Advisor
LLC to E. M. Warburg, Pincus since 1999; Senior
466 Lexington Avenue, 10th Advisor to Lucent Technologies Inc. from
Floor February 1998 to February 1999; Chairman of
New York, NY 10017-3140 Lucent Technologies from 1996 to 1998; Chief
Executive Officer of Lucent Technologies from
February 1996 to October 1997; Chairman of
Cummins Engine Company, Inc. from 1977 to
1995 and its Chief Executive Officer from
1973 to 1994; Director of Cummins Engine
Company, Inc., The Chase Manhattan Bank, The
Chase Manhattan Corporation, Johnson &
Johnson, Knoll, Inc., Lucent Technologies
Inc. and The New York Times Company.
Franklin A. Thomas, 65......... Consultant, TFF Study Group; President of the
TFF Study Group Ford Foundation from 1979 to 1996; Director
595 Madison Avenue of Citigroup Inc., Conoco Inc., Cummins
33rd Floor Engine Company, Inc., Lucent Technologies
New York, NY 10022 Inc. and PepsiCo, Inc.
Marina v.N. Whitman, 64........ Professor of Business Administration and
University of Michigan Public Policy, School of Business
Ann Arbor, MI 48109-1318 Administration and the School of Public
Policy at the University of Michigan since
1992; Director of The Chase Manhattan
Corporation, The Procter & Gamble Company and
Unocal Corporation.
Alain J. P. Belda, 56.......... President and Chief Executive Officer since
May 1999; President and Chief Operating
Officer from 1997 to May 1999; Vice Chairman
from 1995 to 1997; Executive Vice President
from 1994 to 1995; Director of Citigroup
Inc., Cooper Industries, Inc., E. I. du Pont
de Nemours and Company and The Ford
Foundation. Mr. Belda is a citizen of Brazil.
Michael Coleman, 49............ Vice President and President--Alcoa Rigid
Packaging Division. Mr. Coleman joined Alcoa
in January 1998. He had been Vice President--
Operations of North Star Steel from 1993 to
1994, Executive Vice President--Operations
from 1994 to 1996 and President from 1996
through 1997. Mr. Coleman joined North Star
Steel in 1982.
L. Patrick Hassey, 54.......... Vice President and President--Alcoa Europe.
Mr. Hassey joined Alcoa in 1967 and was named
Davenport Works Manager in 1985. In 1991, he
was elected a Vice President of Alcoa and
appointed President--Aerospace/Commercial
Rolled Products Division. He was appointed
President--Alcoa Europe in November 1997.
Barbara S. Jeremiah, 48........ Vice President--Corporate Development. Ms.
Jeremiah joined Alcoa in 1977 as an attorney
and was elected Assistant General Counsel in
1992 and Corporate Secretary in 1993. She was
elected to her current position in 1998,
where she heads Alcoa corporate development
activities.
Richard B. Kelson, 53.......... Executive Vice President and Chief Financial
Officer. Mr. Kelson was elected Assistant
General Counsel in 1989, Senior Vice
President--Environment, Health and Safety in
1991 and Executive Vice President and General
Counsel in May 1994. He was named to his
current position in May 1997.
</TABLE>
I-2
<PAGE>
<TABLE>
<CAPTION>
Present Principal Occupation or
Employment; Material Positions
Name, Age and Business Address Held During the Past Five Years
------------------------------ -------------------------------
<C> <S>
Frank L. Lederman, 50.......... Vice President and Chief Technical Officer.
Mr. Lederman was Senior Vice President and
Chief Technical Officer of Noranda, Inc., a
Canadian-based, diversified natural resource
company, from 1988 to 1995. He joined Alcoa
as a Vice President in May 1995 and became
Chief Technical Officer in December 1995. In
his current position Mr. Lederman directs
operations of the Alcoa Technical Center.
Joseph C. Muscari, 53.......... Vice President--Environment, Health and
Safety, Audit and Compliance. Mr. Muscari
joined Alcoa in 1969 and was named
President--Alcoa Asia in 1993. In 1997, he
was elected Vice President--Audit. He was
named to his current position in May 1999 and
is responsible for EHS policy, standards and
strategy and the Alcoa integrated audit
process. In addition, Mr. Muscari is the
chief compliance officer for the company.
G. John Pizzey, 54............. Vice President and President--Alcoa World
Alumina and Chemicals. Mr. Pizzey joined
Alcoa of Australia Limited in 1970 and was
appointed to the board of Alcoa of Australia
as Executive Director--Victoria Operations
and Managing Director of Portland Smelter
Services in 1986. He was named President--
Bauxite and Alumina Division of Alcoa in 1994
and President--Primary Metals Division of
Alcoa in 1995. Mr. Pizzey was elected a Vice
President of Alcoa in 1996 and was appointed
President--Alcoa World Alumina in November
1997. Mr. Pizzey is a citizen of Australia.
Lawrence R. Purtell, 52........ Executive Vice President and General Counsel
since 1997; from 1996 to 1997, Senior Vice
President, General Counsel and Corporate
Secretary of Koch Industries, Inc.; from 1993
to 1996, Senior Vice President, General
Counsel and Corporate Secretary of McDermott
International, Inc.; and from 1992 to 1993,
Vice President and General Counsel of Carrier
Corporation, a unit of United Technologies
Corporation.
Robert F. Slagle, 59........... Executive Vice President, Human Resources and
Communications. Mr. Slagle was elected
Treasurer in 1982 and Vice President in 1984.
In 1986, he was named Vice President--
Industrial Chemicals and, in 1987, Vice
President--Industrial Chemicals and U.S.
Alumina Operations. Mr. Slagle served as Vice
President--Raw Materials, Alumina and
Industrial Chemicals in 1989, and Vice
President of Alcoa and Managing Director--
Alcoa of Australia Limited in 1991. He was
named President--Alcoa World Alumina in 1996
and was elected to his current position in
November 1997.
G. Keith Turnbull, 64.......... Executive Vice President--Alcoa Business
System. Dr. Turnbull was appointed Assistant
Director of Alcoa Laboratories in 1980. He
was named Director--Technology Planning in
1982, Vice President--Technology Planning in
1986 and Executive Vice President--Strategic
Analysis/Planning and Information in 1991. In
January 1997 he was named to his current
position, with responsibility for company-
wide implementation of the Alcoa Business
System.
</TABLE>
I-3
<PAGE>
2. Directors and Executive Officers of the Purchaser.
The following table sets forth the name, present principal occupation or
employment and material occupations, positions, offices or employments for the
past five years of each director and executive officer of the Purchaser.
Unless otherwise indicated, the current business address of each person is 201
Isabella Street, Pittsburgh, Pennsylvania 15212. Unless otherwise indicated,
each such person is a citizen of the United States of America and each
occupation set forth opposite an individual's name refers to employment with
Alcoa.
<TABLE>
<CAPTION>
Present Principal Occupation
or
Employment; Material Positions
Held During the Past Five
Name, Age and Business Address Years
------------------------------ ------------------------------
<S> <C>
Barbara S. Jeremiah, 48....................... See Part 1 of this Schedule I.
Richard B. Kelson, 53......................... See Part 1 of this Schedule I.
Lawrence R. Purtell, 52....................... See Part 1 of this Schedule I.
</TABLE>
I-4
<PAGE>
Manually signed facsimile copies of the Letter of Transmittal, properly
completed and duly executed, will be accepted. The Letter of Transmittal,
certificates for Shares and any other required documents should be sent or
delivered by each stockholder of the Company or such stockholder's broker,
dealer, commercial bank, trust company or other nominee to the Depositary at
one of the addresses set forth below:
The Depositary for the Offer is:
ChaseMellon Shareholder Services, L.L.C.
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
ChaseMellon Shareholder
Services, L.L.C. ChaseMellon Shareholder Services, L.L.C. ChaseMellon Shareholder Services, L.L.C.
P.O. Box 3301 Mail Drop and Reorganization Department 120 Broadway, 13th Floor
South Hackensack, NJ 85 Challenger Road New York, NY 10271
07606 Ridgefield Park, NJ 07660 Attn: Reorganization Department
</TABLE>
BY FACSIMILE TRANSMISSION:
(For Eligible
Institutions Only)
(201) 296-4293
CONFIRM FACSIMILE BY TELEPHONE:
(201) 295-4860
(For Confirmation Only)
Questions or requests for assistance may be directed to the Information
Agent or the Dealer Manager, at the addresses and telephone numbers set forth
below. Additional copies of this Offer to Purchase, the Letter of Transmittal,
the Notice of Guaranteed Delivery and related materials may be obtained from
the Information Agent or the Dealer Manager as set forth below and will be
furnished promptly at the Purchaser's expense. Stockholders may also contact
their broker, dealer, commercial bank, trust company or other nominee for
assistance concerning the Offer.
The Information Agent for the Offer is:
[Logo of Morrow & Co., Inc.]
445 Park Avenue, 5th Floor
New York, NY 10022
Call Collect: (212) 754-8000
Banks and Brokerage Firms, Please Call: (800) 662-5200
Stockholders Please Call: (800) 566-9061
The Dealer Manager for the Offer is:
Salomon Smith Barney
388 Greenwich Street
New York, NY 10013
Call Toll Free: (877) 319-4978
<PAGE>
Letter of Transmittal
to Tender Shares of Common Stock
(Including the Associated Rights to Purchase Preferred Stock)
of
Cordant Technologies Inc.
Pursuant to the Offer to Purchase dated March 20, 2000
by
Omega Acquisition Corp.
a wholly owned subsidiary of
Alcoa Inc.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON MONDAY, APRIL 24, 2000, UNLESS THE OFFER IS EXTENDED.
The Depositary for the Offer is:
ChaseMellon Shareholder Services, L.L.C.
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
ChaseMellon Shareholder ChaseMellon Shareholder Services, L.L.C. ChaseMellon Shareholder Services, L.L.C.
Services, L.L.C. Mail Drop and Reorganization Department 120 Broadway, 13th Floor
P.O. Box 3301 85 Challenger Road New York, NY 10271
South Hackensack, NJ Ridgefield Park, NJ 07660 Attn: Reorganization Department
07606
</TABLE>
BY FACSIMILE TRANSMISSION:
(For Eligible Institutions Only)
(201) 296-4293
CONFIRM FACSIMILE BY TELEPHONE:
(201) 295-4860
(For Confirmation Only)
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE, OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TO A NUMBER OTHER THAN AS
SET FORTH ABOVE, WILL NOT CONSTITUTE A VALID DELIVERY TO THE DEPOSITARY. YOU
MUST SIGN THIS LETTER OF TRANSMITTAL IN THE APPROPRIATE SPACE PROVIDED
THEREFOR BELOW, WITH SIGNATURE GUARANTEE IF REQUIRED, AND COMPLETE THE
SUBSTITUTE FORM W-9 SET FORTH BELOW.
THE INSTRUCTIONS CONTAINED WITHIN THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
DESCRIPTION OF SHARES TENDERED
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
Name(s) and Address(es) of
Registered Holder(s) Shares Certificate(s) and Share(s) Tendered
(Please Fill in, if blank) (Please attach additional signed list, if necessary)
- ----------------------------------------------------------------------------------
Total Number of
Shares
Represented Number
Share Certificate by of Shares
Number(s)(1) Certificate(s)(1) Tendered(2)
----------------------------------------------------
<S> <C> <C> <C>
----------------------------------------------------
----------------------------------------------------
----------------------------------------------------
----------------------------------------------------
----------------------------------------------------
Total Shares Tendered
</TABLE>
- -------------------------------------------------------------------------------
(1) Need not be completed by stockholders who deliver Shares by book-entry
transfer ("Book-Entry Stockholders").
(2) Unless otherwise indicated, all Shares represented by certificates
delivered to the Depositary will be deemed to have been tendered. See
Instruction 4.
[_] CHECK HERE IF CERTIFICATES HAVE BEEN LOST OR MUTILATED. SEE
INSTRUCTION 11.
The names and addresses of the registered holders of the tendered Shares
should be printed, if not already printed above, exactly as they appear on the
Share Certificates tendered hereby.
<PAGE>
This Letter of Transmittal is to be used by stockholders of Cordant
Technologies Inc. (the "Company") if certificates for Shares (as defined
below) are to be forwarded herewith or, unless an Agent's Message (as defined
in Section 3 of the Offer to Purchase) is utilized, if delivery of Shares is
to be made by book-entry transfer to an account maintained by the Depositary
at the Book-Entry Transfer Facility (as defined in Section 2 of the Offer to
Purchase and pursuant to the procedures set forth in Section 3 thereof).
Holders of Shares whose certificates for such Shares (the "Share
Certificates") are not immediately available, or who cannot complete the
procedure for book-entry transfer on a timely basis, or who cannot deliver all
other required documents to the Depositary prior to the Expiration Date (as
defined in the Offer to Purchase), must tender their Shares according to the
guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase.
See Instruction 2. DELIVERY OF DOCUMENTS TO THE BOOK-ENTRY TRANSFER FACILITY
WILL NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
TENDER OF SHARES
[_]CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY
TRANSFER TO THE DEPOSITARY'S ACCOUNT AT THE BOOK-ENTRY TRANSFER
FACILITY AND COMPLETE THE FOLLOWING (ONLY PARTICIPANTS IN THE BOOK-
ENTRY TRANSFER FACILITY MAY DELIVER SHARES BY BOOK-ENTRY TRANSFER):
Name of Tendering Institution: _________________________________________
Account Number: ________________________________________________________
Transaction Code Number: _______________________________________________
_______________________________________________________________________________
[_]CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE
OF GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE
THE FOLLOWING:
Name(s) of Registered Holder(s): _______________________________________
Window Ticket Number (if any): _________________________________________
Date of Execution of Notice of Guaranteed Delivery: ____________________
Name of Eligible Institution that Guaranteed Delivery: _________________
2
<PAGE>
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE INSTRUCTIONS SET FORTH IN THIS LETTER OF
TRANSMITTAL CAREFULLY
Ladies and Gentlemen:
The undersigned hereby tenders to Omega Acquisition Corp., a Delaware
corporation (the "Purchaser") and a wholly owned subsidiary of Alcoa Inc., a
Pennsylvania corporation ("Alcoa"), the above-described shares of common
stock, par value $1.00 per share, of Cordant Technologies Inc., a Delaware
corporation (the "Company"), including the associated rights to purchase
preferred stock (collectively, the "Shares"), pursuant to the Purchaser's
offer to purchase all outstanding Shares, at a purchase price of $57.00 per
Share, net to the seller in cash (the "Offer Price"), without interest
thereon, upon the terms and subject to the conditions set forth in the Offer
to Purchase dated March 20, 2000, and in this Letter of Transmittal (which
together with any amendments or supplements thereto or hereto, collectively
constitute the "Offer"). Receipt of the Offer is hereby acknowledged.
Upon the terms and subject to the conditions of the Offer (and if the Offer
is extended or amended, the terms of any such extension or amendment), and
effective upon acceptance for payment of the Shares tendered herewith in
accordance with the terms of the Offer, the undersigned hereby sells, assigns
and transfers to or upon the order of the Purchaser all right, title and
interest in and to all of the Shares that are being tendered hereby (and any
and all dividends (other than regular quarterly cash dividends not in excess
of $0.10 per Share declared and paid in accordance with past practice,
including the establishment of record and payment dates, with a record date
prior to the date of acceptance for payment of the Shares in the Offer),
distributions, rights, other Shares or other securities issued or issuable in
respect thereof on or after the date hereof (collectively, "Distributions"))
and irrevocably constitutes and appoints ChaseMellon Shareholder Services,
L.L.C. (the "Depositary") the true and lawful agent and attorney-in-fact of
the undersigned with respect to such Shares (and all Distributions), with full
power of substitution (such power of attorney being deemed to be an
irrevocable power coupled with an interest), to (i) deliver certificates for
such Shares (and any and all Distributions) or transfer ownership of such
Shares (and any and all Distributions) on the account books maintained by the
Book-Entry Transfer Facility, together, in any such case, with all
accompanying evidences of transfer and authenticity, to or upon the order of
the Purchaser, (ii) present such Shares (and any and all Distributions) for
transfer on the books of the Company, and (iii) receive all benefits and
otherwise exercise all rights of beneficial ownership of such Shares (and any
and all Distributions), all in accordance with the terms of the Offer.
By executing this Letter of Transmittal, the undersigned hereby irrevocably
appoints Richard B. Kelson and Lawrence R. Purtell in their respective
capacities as officers or directors of the Purchaser, and any individual who
shall thereafter succeed to any such office of the Purchaser, and each of
them, and any other designees of the Purchaser, the attorneys-in-fact and
proxies of the undersigned, each with full power of substitution, to vote at
any annual or special meeting of the Company's stockholders or any adjournment
or postponement thereof or otherwise in such manner as each such attorney-in-
fact and proxy or his or her substitute shall in his or her sole discretion
deem proper with respect to, to execute any written consent concerning any
matter as each such attorney-in-fact and proxy or his or her substitute shall
in his or her sole discretion deem proper with respect to, and to otherwise
act as each such attorney-in-fact and proxy or his or her substitute shall in
his or her sole discretion deem proper with respect to, all of the Shares (and
any and all Distributions) tendered hereby and accepted for payment by the
Purchaser. This appointment will be effective if and when, and only to the
extent that, the Purchaser accepts such Shares for payment pursuant to the
Offer. This power of attorney and proxy are irrevocable and are granted in
consideration of the acceptance for payment of such Shares in accordance with
the terms of the Offer. Such acceptance for payment shall, without further
action, revoke any prior powers of attorney and proxies granted by the
undersigned at any time with respect to such Shares (and any and all
Distributions), and no subsequent powers of attorney, proxies, consents or
revocations may be given by the undersigned with respect thereto (and, if
given, will not be deemed effective). The Purchaser reserves the right to
require that, in order for the Shares or other securities to be deemed validly
tendered, immediately upon the Purchaser's acceptance for payment of such
Shares, the Purchaser must be able to exercise full voting,
3
<PAGE>
consent and other rights with respect to such Shares (and any and all
Distributions), including voting at any meeting of the Company's stockholders.
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, sell, assign and transfer the Shares tendered
hereby and all Distributions and that, when the same are accepted for payment
by the Purchaser, the Purchaser will acquire good, marketable and unencumbered
title thereto and to all Distributions, free and clear of all liens,
restrictions, charges and encumbrances and the same will not be subject to any
adverse claims. The undersigned will, upon request, execute and deliver any
additional documents deemed by the Depositary or the Purchaser to be necessary
or desirable to complete the sale, assignment and transfer of the Shares
tendered hereby and all Distributions. In addition, the undersigned shall
remit and transfer promptly to the Depositary for the account of the Purchaser
all Distributions in respect of the Shares tendered hereby, accompanied by
appropriate documentation of transfer, and, pending such remittance and
transfer or appropriate assurance thereof, the Purchaser shall be entitled to
all rights and privileges as owner of each such Distribution and may withhold
the entire purchase price of the Shares tendered hereby or deduct from such
purchase price, the amount or value of such Distribution as determined by the
Purchaser in its sole discretion.
All authority herein conferred or agreed to be conferred shall survive the
death or incapacity of the undersigned, and any obligation of the undersigned
hereunder shall be binding upon the heirs, executors, administrators, personal
representatives, trustees in bankruptcy, successors and assigns of the
undersigned. Except as stated in the Offer, this tender is irrevocable.
The undersigned understands that the valid tender of the Shares pursuant to
any one of the procedures described in Section 3 of the Offer to Purchase and
in the Instructions hereto will constitute a binding agreement between the
undersigned and the Purchaser upon the terms and subject to the conditions of
the Offer (and if the Offer is extended or amended, the terms or conditions of
any such extension or amendment). Without limiting the foregoing, if the price
to be paid in the Offer is amended in accordance with the Merger Agreement,
the price to be paid to the undersigned will be the amended price
notwithstanding the fact that a different price is stated in this Letter of
Transmittal. The undersigned recognizes that under certain circumstances set
forth in the Offer to Purchase, the Purchaser may not be required to accept
for payment any of the Shares tendered hereby.
Unless otherwise indicated under "Special Payment Instructions," please
issue the check for the purchase price of all of the Shares purchased and/or
return any certificates for the Shares not tendered or accepted for payment in
the name(s) of the registered holder(s) appearing above under "Description of
Shares Tendered." Similarly, unless otherwise indicated under "Special
Delivery Instructions," please mail the check for the purchase price of all of
the Shares purchased and/or return any certificates for the Shares not
tendered or not accepted for payment (and any accompanying documents, as
appropriate) to the address(es) of the registered holder(s) appearing above
under "Description of Shares Tendered." In the event that the boxes entitled
"Special Payment Instructions" and "Special Delivery Instructions" are both
completed, please issue the check for the purchase price of all Shares
purchased and/or return any certificates evidencing Shares not tendered or not
accepted for payment (and any accompanying documents, as appropriate) in the
name(s) of, and deliver such check and/or return any such certificates (and
any accompanying documents, as appropriate) to, the person(s) so indicated.
Unless otherwise indicated herein in the box entitled "Special Payment
Instructions," please credit any Shares tendered herewith by book-entry
transfer that are not accepted for payment by crediting the account at the
Book-Entry Transfer Facility designated above. The undersigned recognizes that
the Purchaser has no obligation, pursuant to the "Special Payment
Instructions," to transfer any Shares from the name of the registered holder
thereof if the Purchaser does not accept for payment any of the Shares so
tendered.
4
<PAGE>
SPECIAL PAYMENT INSTRUCTIONS (See SPECIAL DELIVERY INSTRUCTIONS
Instructions 1, 5, 6 and 7) (See Instructions 1, 5, 6 and 7)
To be completed ONLY if the To be completed ONLY if the
check for the purchase price of check for the purchase price of
Shares accepted for payment Shares accepted for payment
and/or certificates representing and/or certificates representing
Shares not tendered or accepted Shares not tendered or accepted
for payment are to be issued in for payment are to be sent to
the name of someone other than someone other than the under-
the undersigned. signed or to the undersigned at
an address other than that shown
Issue:[_] Check under "Description of Shares Ten-
[_] Certificate(s) to dered."
Name _____________________________ Mail:[_] Check
(Please Print) [_] Certificate(s) to
Address __________________________ Name _____________________________
(Please Print)
__________________________________
(Include Zip Code) Address __________________________
__________________________________ __________________________________
(Taxpayer Identification or
Social Security Number)
(Include Zip Code)
(Also complete Substitute Form W-
9 below)
5
<PAGE>
IMPORTANT
SHAREHOLDER: SIGN HERE
(Please Complete Substitute Form W-9 Included Herein)
_______________________________________________________
_______________________________________________________
(Signature(s) of Owner(s))
Name(s)________________________________________________
________________________________________________
Capacity (Full Title) _________________________________
(See Instructions)
Address________________________________________________
________________________________________________
________________________________________________
________________________________________________
(Include Zip Code)
Area Code and Telephone Number ________________________
Taxpayer Identification or
Social Security Number ________________________________
(See Substitute Form W-9)
Dated: __________ , 2000
(Must be signed by the registered holder(s) exactly as
name(s) appear(s) on stock certificate(s) or on a
security position listing or by the person(s)
authorized to become registered holder(s) by
certificates and documents transmitted herewith. If
signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation
or other person acting in a fiduciary or
representative capacity, please set forth full title
and see Instruction 5.)
GUARANTEE OF SIGNATURE(S)
(If required--See Instructions 1 and 5)
Authorized Signatures(s) ______________________________
Name __________________________________________________
Name of Firm __________________________________________
Address _______________________________________________
(Include Zip Code)
Area Code and Telephone Number ________________________
Dated: __________ , 2000
6
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. Guarantee of Signatures. No signature guarantee is required on this
Letter of Transmittal (a) if this Letter of Transmittal is signed by the
registered holder(s) (which term, for purposes of this Section, includes any
participant in the Book-Entry Transfer Facility's systems whose name appears
on a security position listing as the owner of the Shares) of Shares tendered
herewith, unless such registered holder(s) has completed either the box
entitled "Special Payment Instructions" or the box entitled "Special Delivery
Instructions" on the Letter of Transmittal or (b) if such Shares are tendered
for the account of a financial institution (including most commercial banks,
savings and loan associations and brokerage houses) that is a participant in
the Security Transfer Agents Medallion Program, the New York Stock Exchange
Medallion Signature Guarantee Program or the Stock Exchange Medallion Program
or by any other "eligible guarantor institution," as such term is defined in
Rule 17Ad-15 under the Exchange Act (each, an "Eligible Institution"). In all
other cases, all signatures on this Letter of Transmittal must be guaranteed
by an Eligible Institution. See Instruction 5.
2. Requirements of Tender. This Letter of Transmittal is to be completed by
stockholders if certificates are to be forwarded herewith or, unless an
Agent's Message is utilized, if tenders are to be made pursuant to the
procedure for tender by book-entry transfer set forth in Section 3 of the
Offer to Purchase. Share Certificates evidencing tendered Shares, or timely
confirmation (a "Book-Entry Confirmation") of a book-entry transfer of Shares
into the Depositary's account at the Book-Entry Transfer Facility, as well as
this Letter of Transmittal (or a facsimile hereof), properly completed and
duly executed, with any required signature guarantees, or an Agent's Message
in connection with a book-entry transfer, and any other documents required by
this Letter of Transmittal, must be received by the Depositary at one of its
addresses set forth herein prior to the Expiration Date (as defined in Section
1 of the Offer to Purchase). Stockholders whose Share Certificates are not
immediately available, or who cannot complete the procedure for delivery by
book-entry transfer on a timely basis or who cannot deliver all other required
documents to the Depositary prior to the Expiration Date, may tender their
Shares by properly completing and duly executing a Notice of Guaranteed
Delivery pursuant to the guaranteed delivery procedure set forth in Section 3
of the Offer to Purchase. Pursuant to such procedure: (i) such tender must be
made by or through an Eligible Institution; (ii) a properly completed and duly
executed Notice of Guaranteed Delivery, substantially in the form made
available by the Purchaser, must be received by the Depositary prior to the
Expiration Date; 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 facsimile thereof),
properly completed and duly executed, with any required signature guarantees
(or, in the case of a book-entry delivery, an Agent's Message) and any other
documents required by this Letter of Transmittal, must be received by the
Depositary within three New York Stock Exchange trading days after the date of
execution of such Notice of the Guaranteed Delivery. If Share Certificates are
forwarded separately to the Depositary, a properly completed and duly executed
Letter of Transmittal must accompany each such delivery.
The method of delivery of this Letter of Transmittal, Share Certificates and
all other required documents, including delivery through the Book-Entry
Transfer Facility, is at the option and the risk of the tendering stockholder
and the delivery will be deemed made only when actually received by the
Depositary (including, in the case of book-entry transfer, by book-entry
confirmation). 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.
No alternative, conditional or contingent tenders will be accepted and no
fractional Shares will be purchased. All tendering stockholders, by execution
of this Letter of Transmittal (or a facsimile hereof), waive any right to
receive any notice of the acceptance of their Shares for payment.
3. Inadequate Space. If the space provided herein is inadequate, the
certificate numbers and/or the number of Shares and any other required
information should be listed on a separate signed schedule attached hereto.
7
<PAGE>
4. Partial Tenders (not applicable to stockholders who tender by book-entry
transfer). If fewer than all of the Shares evidenced by any Share Certificate
are to be tendered, fill in the number of Shares that are to be tendered in
the box entitled "Number of Shared Tendered." In this case, new Share
Certificates for the Shares that were evidenced by your old Share
Certificates, but were not tendered by you, will be sent to you, unless
otherwise provided in the appropriate box on this Letter of Transmittal, as
soon as practicable after the Expiration Date. All Shares represented by Share
Certificates delivered to the Depositary will be deemed to have been tendered
unless indicated.
5. Signatures on Letter of Transmittal, Stock Powers and Endorsements. If
this Letter of Transmittal is signed by the registered holder(s) of the Shares
tendered hereby, the signature(s) must correspond with the name(s) as written
on the face of the certificate(s) without alteration, enlargement or any
change whatsoever.
If any of the Shares tendered hereby are held of record by two or more joint
owners, all such owners must sign this Letter of Transmittal.
If any of the tendered Shares are registered in different names on several
certificates, it will be necessary to complete, sign and submit as many
separate Letters of Transmittal as there are different registrations.
If this Letter of Transmittal or any certificates or stock powers are signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of
a corporation or other person acting in a fiduciary or representative
capacity, such person should so indicate when signing, and proper evidence
satisfactory to the Purchaser of the authority of such person so to act must
be submitted. If this Letter of Transmittal is signed by the registered
holder(s) of the Shares listed and transmitted hereby, no endorsements of
certificates or separate stock powers are required unless payment is to be
made or certificates for Shares not tendered or not accepted for payment are
to be issued in the name of a person other than the registered holder(s).
Signatures on any such Share Certificates or stock powers must be guaranteed
by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the certificate(s) listed and transmitted hereby, the
certificate(s) must be endorsed or accompanied by appropriate stock powers, in
either case signed exactly as the name(s) of the registered holder(s)
appear(s) on the certificate(s). Signature(s) on any such Share Certificates
or stock powers must be guaranteed by an Eligible Institution.
6. Stock Transfer Taxes. Except as otherwise provided in this Instruction 6,
the Purchaser will pay all stock transfer taxes with respect to the transfer
and sale of any Shares to it or its order pursuant to the Offer. If, however,
payment of the purchase price is to be made to, or if certificate(s) for
Shares not tendered or not accepted for payment are to be registered in the
name of, any person other than the registered holder(s), or if tendered
certificate(s) are registered in the name of any person other than the
person(s) signing this Letter of Transmittal, the amount of any stock transfer
taxes (whether imposed on the registered holder(s) or such other person)
payable on account of the transfer to such other person will be deducted from
the purchase price of such Shares purchased unless evidence satisfactory to
the Purchaser of the payment of such taxes, or exemption therefrom, is
submitted.
Except as provided in this Instruction 6, it will not be necessary for
transfer tax stamps to be affixed to the certificate(s) evidencing the Shares
tendered hereby.
7. Special Payment and Delivery Instructions. If a check is to be issued in
the name of, and/or certificates for Shares not tendered or not accepted for
payment are to be issued or returned to, a person other than the signer of
this Letter of Transmittal or if a check and/or such certificates are to be
returned to a person other than the person(s) signing this Letter of
Transmittal or to an address other than that shown in this Letter of
Transmittal, the appropriate boxes on this Letter of Transmittal must be
completed.
8. Substitute Form W-9. A tendering stockholder is required to provide the
Depositary with a correct Taxpayer Identification Number ("TIN") on Substitute
Form W-9, which is provided under "Important Tax
8
<PAGE>
Information" below, and to certify, under penalties of perjury, that such
number is correct and that such stockholder is not subject to backup
withholding of Federal income tax. If a tendering stockholder is subject to
backup withholding, the stockholder must cross out Item (y) of Part 3 of the
Certification Box of the Substitute Form W-9. Failure to provide the
information on the Substitute Form W-9 may subject the tendering stockholder
to Federal income tax withholding of 31% of any payments made to the
stockholder, but such withholdings will be refunded if the tendering
stockholder.
Certain stockholders (including, among others, all corporations and certain
foreign individuals and entities) are not subject to backup withholding.
Noncorporate foreign stockholders should submit an appropriate and properly
completed IRS Form W-8, a copy of which may be obtained from the Depositary,
in order to avoid backup withholding. See the enclosed "Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9" for
more instructions.
9. Requests for Assistance or Additional Copies. Questions and requests for
assistance or additional copies of the Offer to Purchase, this Letter of
Transmittal, the Notice of Guaranteed Delivery, IRS Form W-8 and the
Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9 may be directed to the Information Agent or Dealer Manager at the
addresses and phone numbers set forth below, or from brokers, dealers,
commercial banks or trust companies.
10. Waiver of Conditions. Subject to the terms and conditions of the Merger
Agreement (as defined in the Offer to Purchase), the Purchaser reserves the
right, in its sole discretion, to waive, at any time or from time to time, any
of the specified conditions of the Offer, in whole or in part, in the case of
any Shares tendered (other than the Minimum Condition).
11. Lost, Destroyed or Stolen Certificates. If any certificate representing
Shares has been lost, destroyed or stolen, the stockholder should promptly
notify First Chicago Trust Company of New York, in its capacity as transfer
agent for the shares (toll-free telephone number: (800) 446-2617). The
stockholder will then be instructed as to the steps that must be taken in
order to replace the certificate. This Letter of Transmittal and related
documents cannot be processed until the procedures for replacing lost or
destroyed certificates have been followed.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A MANUALLY SIGNED FACSIMILE
HEREOF) TOGETHER WITH ANY REQUIRED SIGNATURE GUARANTEES, OR, IN THE CASE OF A
BOOK-ENTRY TRANSFER, AN AGENT'S MESSAGE, AND ANY OTHER REQUIRED DOCUMENTS,
MUST BE RECEIVED BY THE DEPOSITARY PRIOR TO THE EXPIRATION DATE AND EITHER
CERTIFICATES FOR TENDERED SHARES MUST BE RECEIVED BY THE DEPOSITARY OR SHARES
MUST BE DELIVERED PURSUANT TO THE PROCEDURES FOR BOOK-ENTRY TRANSFER, IN EACH
CASE PRIOR TO THE EXPIRATION DATE, OR THE TENDERING STOCKHOLDER MUST COMPLY
WITH THE PROCEDURES FOR GUARANTEED DELIVERY.
9
<PAGE>
IMPORTANT TAX INFORMATION
Under the federal income tax law, a stockholder whose tendered Shares are
accepted for payment is required to provide the Depositary with such
stockholder's correct TIN on the Substitute Form W-9 below. If such
stockholder is an individual, the TIN is such stockholder's Social Security
Number. If a tendering stockholder is subject to backup withholding, such
stockholder must cross out Item (y) of Part 3 on the Substitute Form W-9. If
the Depositary is not provided with the correct TIN, the stockholder may be
subject to a $50 penalty imposed by the Internal Revenue Service. In addition,
payments that are made to such stockholder may be subject to backup
withholding of 31%.
Certain stockholders (including, among others, all corporations and certain
foreign individuals) are not subject to these backup withholding and reporting
requirements. In order for a foreign individual to qualify as an exempt
recipient, such individual must submit an appropriate and properly completed
IRS Form W-8, attesting to that individual's exempt status. Such a Form W-8
may be obtained from the Depositary. Exempt stockholders, other than foreign
individuals, should furnish their TIN, write "Exempt" in Part 2 of the
Substitute Form W-9 below and sign, date and return the Substitute Form W-9 to
the Depositary. See the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional instructions.
If backup withholding applies, the Depositary is required to withhold 31% of
any payments made to the stockholder. Backup withholding is not an additional
tax. Rather, the tax liability of persons subject to withholding will be
reduced by the amount of tax withheld. If backup withholding results in an
overpayment of taxes, a refund may be obtained from the Internal Revenue
Service.
Purpose of Substitute Form W-9
To prevent backup withholding on payments that are made to a stockholder
with respect to Shares and Rights purchased pursuant to the Offer, the
stockholder is required to notify the Depositary of such stockholder's correct
TIN by completing the form below certifying that the TIN provided on
Substitute Form W-9 is correct (or that such stockholder is awaiting a TIN).
What Number to Give the Depositary
The stockholder is required to give the Depositary the Social Security
Number of the record holder of the Shares. If the Shares are in more than one
name, or are not in the name of the actual owner, consult the enclosed
Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9 for additional guidelines on which number to report. If the tendering
stockholder has not been issued a TIN and has applied for a number or intends
to apply for a number in the near future, the stockholder should check the box
in Part 1(b), sign and date the Substitute Form W-9. If the box in Part 1(b)
is checked, the Depositary will withhold 31% of payments made for the
stockholder, but such withholdings will be refunded if the tendering
stockholder provides a TIN within 60 days.
10
<PAGE>
PAYER'S NAME: CHASEMELLON SHAREHOLDER SERVICES, L.L.C.
Name _________________________________________________
SUBSTITUTE
Form W-9 Address ______________________________________________
Department of
the Treasury ______________________________________________________
Internal (Number and Street)
Revenue Service
______________________________________________________
Payer's Request for (Zip Code) (City) (State)
Taxpayer --------------------------------------------------------
Part 1(a)--PLEASE PROVIDE TIN __________________
Identification YOUR TIN IN THE BOX AT
Number (TIN) RIGHT AND CERTIFY BY ----------------------
SIGNING AND DATING BELOW. (Social Security Number or
Employer identification Number)
--------------------------------------------------------
Part 1(b)--PLEASE CHECK THE BOX AT RIGHT IF YOU HAVE
APPLIED FOR, AND ARE AWAITING RECEIPT OF, YOUR TIN [_]
--------------------------------------------------------
Part 2--FOR PAYEES EXEMPT FROM BACKUP WITHHOLDING
PLEASE WRITE "EXEMPT" HERE (SEE INSTRUCTIONS)
--------------------------------------------------------
Part 3--CERTIFICATION UNDER PENALTIES OF PERJURY, I
CERTIFY THAT (X) The number shown on this form is my
correct TIN (or I am waiting for a number to be
issued to me) and (Y) I am not subject to backup
withholding because: (a) I am exempt from backup
withholding, or (b) I have not been notified by the
Internal Revenue Service (the "IRS") that I am
subject to backup withholding as a result of a
failure to report all interest or dividends, or (c)
the IRS has notified me that I am no longer subject
to backup withholding.
Sign Here (right SIGNATURE ____________________________________________
arrow)
DATE _________________________________________________
Certification of Instructions--You must cross out Item (Y) of Part 3 above
if you have been notified by the IRS that you are currently subject to backup
withholding because of underreporting interest or dividends on your tax
return. However, if after being notified by the IRS that you were subject to
backup withholding you received another notification from the IRS that you are
no longer subject to backup withholding, do not cross out such Item (Y).
11
<PAGE>
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART
1(B) OF THE SUBSTITUTE FORM W-9 INDICATING YOU HAVE APPLIED FOR, AND ARE
AWAITING RECEIPT OF, YOUR TIN.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification
number has not been issued to me, and either (1) I have mailed or
delivered an application to receive a taxpayer identification number
to the appropriate Internal Revenue Service Center or Social Security
Administration Office or (2) I intend to mail or deliver an
application in the near future. I understand that if I do not provide
a taxpayer identification number to the Payor by the time of payment,
31 percent of all reportable payments made to me pursuant to this
Offer will be withheld.
_________________________________ _________________________________
Signature Date
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER.
PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
MANUALLY SIGNED FACSIMILE COPIES OF THE LETTER OF TRANSMITTAL WILL BE
ACCEPTED. THE LETTER OF TRANSMITTAL, CERTIFICATES FOR SHARES AND ANY OTHER
REQUIRED DOCUMENTS SHOULD BE SENT OR DELIVERED BY EACH STOCKHOLDER OF THE
COMPANY OR SUCH STOCKHOLDER'S BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY
OR OTHER NOMINEE TO THE DEPOSITARY AT ONE OF ITS ADDRESSES SET FORTH ON THE
FIRST PAGE.
Questions and requests for assistance or for additional copies of the Offer
to Purchase, the Letter of Transmittal, the Notice of Guaranteed Delivery and
other tender offer materials may be directed to the Information Agent or the
Dealer Manager at their respective telephone numbers and locations listed
below, and will be furnished promptly at the Purchaser's expense. You may also
contact your broker, dealer, commercial bank, trust company or other nominee
for assistance concerning the Offer.
The Information Agent for the Offer is:
[Logo of Morrow & Co., Inc]
445 Park Avenue, 5th Floor
New York, NY 10022
Call Collect: (212) 754-8000
Banks and Brokerage Firms, Please Call: (800) 662-5200
Stockholders Please Call: (800) 566-9061
The Dealer Manager for the Offer is:
Salomon Smith Barney
388 Greenwich Street
New York, NY 10013
Call Toll Free: (877) 319-4978
12
<PAGE>
Notice of Guaranteed Delivery
for
Tender of Shares of Common Stock
(Including the Associated Rights to Purchase Preferred Stock)
of
Cordant Technologies Inc.
to
Omega Acquisition Corp.
a wholly owned subsidiary of
Alcoa Inc.
(Not to be used for signature guarantees)
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON MONDAY, APRIL 24, 2000, UNLESS THE OFFER IS EXTENDED.
This Notice of Guaranteed Delivery, or a form substantially equivalent
hereto, must be used to accept the Offer (as defined below) if certificates
for Shares (as defined below) are not immediately available, if the procedure
for book-entry transfer cannot be completed on a timely basis, or if time will
not permit all required documents to reach ChaseMellon Shareholder Services,
L.L.C. (the "Depositary") on or prior to the Expiration Date (as defined in
Section 1 of the Offer to Purchase). This form may be delivered by hand,
transmitted by facsimile transmission or mailed (to the Depositary). See
Section 3 of the Offer to Purchase.
ChaseMellon Shareholder Services, L.L.C.
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
ChaseMellon Shareholder
Services, L.L.C. ChaseMellon Shareholder Services, L.L.C. ChaseMellon Shareholder Services, L.L.C.
P.O. Box 3301 Mail Drop and Reorganization Department 120 Broadway, 13th Floor
South Hackensack, NJ 85 Challenger Road New York, NY 10271
07606 Ridgefield Park, NJ 07660 Attn: Reorganization Department
</TABLE>
BY FACSIMILE
TRANSMISSION:
(For Eligible Institutions Only)
(201) 296-4293
CONFIRM FACSIMILE BY TELEPHONE:
(201) 295-4860
(For Confirmation Only)
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN ONE
SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE NUMBER OTHER
THAN THE FACSIMILE NUMBER SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY
TO THE DEPOSITARY.
THIS NOTICE OF GUARANTEED DELIVERY TO THE DEPOSITARY IS NOT TO BE USED TO
GUARANTEE SIGNATURES. IF A SIGNATURE ON A LETTER OF TRANSMITTAL IS REQUIRED TO
BE GUARANTEED BY AN "ELIGIBLE INSTITUTION" (AS DEFINED IN THE OFFER TO
PURCHASE) UNDER THE INSTRUCTIONS THERETO, SUCH SIGNATURE GUARANTEES MUST
APPEAR IN THE APPLICABLE SPACE PROVIDED IN THE SIGNATURE BOX ON THE LETTER TO
TRANSMITTAL.
The Eligible Institution that completes this form must communicate the
guarantee to the Depositary and must deliver the Letter of Transmittal or an
Agent's Message (as defined in the Offer to Purchase) and certificates for
Shares to the Depositary within the time period shown herein. Failure to do so
could result in a financial loss to such Eligible Institution.
THE GUARANTEE ON THE REVERSE SIDE MUST BE COMPLETED.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Omega Acquisition Corp., a Delaware
corporation and a wholly owned subsidiary of Alcoa Inc., a Pennsylvania
corporation, upon the terms and subject to the conditions set forth in the
Offer to Purchase dated March 20, 2000 (the "Offer to Purchase") and the
related Letter of Transmittal (which, together with any amendments or
supplements thereto, constitute the "Offer"), receipt of which is hereby
acknowledged, the number of shares of common stock, par value $1.00 per share,
of Cordant Technologies Inc., a Delaware corporation (the "Company"),
including the associated rights to purchase preferred stock (collectively, the
"Shares"), set forth below, pursuant to the guaranteed delivery procedures set
forth in the Offer to Purchase.
Number of Shares Tendered: SIGN HERE
------------ Name(s) of Record Holder(s)
Certificate No(s) (if available):
---------------------------------
- ---------------------------------
- --------------------------------- ---------------------------------
(Please Print)
[_]Check if securities will be
tendered by book-entry Address(es):
transfer
---------------------------------
Name of Tendering Institution:
---------------------------------
- --------------------------------- (Zip Code)
Account: No.: Area Code and Telephone No(s):
-----------------------
---------------------------------
Dated: , 2000
----------------------- Signature(s)
---------------------------------
---------------------------------
<PAGE>
GUARANTEE
(Not to be used for signature guarantee)
The undersigned, a bank, broker, dealer, credit union, savings association
or other entity that is a member in good standing of the Securities Transfer
Agents Medallion Program, (a) represents that the above named person(s)
"own(s)" the Shares tendered hereby within the meaning of Rule 14e-4 under the
Securities Exchange Act of 1934, as amended ("Rule 14e-4"), (b) represents
that such tender of Shares complies with Rule 14e-4 and (c) guarantees to
deliver to the Depositary either the certificates evidencing all tendered
Shares, in proper form for transfer, or to deliver Shares pursuant to the
procedure for book-entry transfer into the Depositary's account at The
Depository Trust Company (the "Book-Entry Transfer Facility"), in either case
together with the Letter of Transmittal (or a facsimile thereof) properly
completed and duly executed, with any required signature guarantees or an
Agent's Message (as defined in the Offer to Purchase) in the case of a book-
entry delivery, and any other required documents, all within three New York
Stock Exchange trading days after the date hereof.
Name of Firm: ---------------------------------
----------------------- (Authorized Signature)
Address: Title:
--------------------------- -----------------------------
- ---------------------------------- Name:
----------------------------
Zip Code
---------------------------------
Area Code and Tel. No. (Please type or print)
----------------
Dated: , 2000
------------------------
NOTE: DO NOT SEND CERTIFICATES FOR SHARES WITH THIS NOTICE. CERTIFICATES FOR
SHARES SHOULD BE SENT WITH YOUR LETTER OF TRANSMITTAL.
<PAGE>
[LOGO OF SOLOMON SMITH BARNEY]
Offer to Purchase for Cash
All Outstanding Shares of Common Stock
(Including the Associated Rights to Purchase Preferred Stock)
of
Cordant Technologies Inc.
by
Omega Acquisition Corp.
a wholly owned subsidiary of
Alcoa Inc.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON MONDAY, APRIL 24, 2000, UNLESS THE OFFER IS EXTENDED.
March 20, 2000
To Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees:
We have been appointed by Omega Acquisition Corp., a Delaware corporation
(the "Purchaser") and a wholly owned subsidiary of Alcoa Inc., a Pennsylvania
corporation ("Alcoa") to act as Dealer Manager in connection with the
Purchaser's offer to purchase all outstanding shares of common stock, par
value $1.00 per share, including the associated rights to purchase preferred
stock (collectively, the "Shares"), of Cordant Technologies Inc., a Delaware
corporation (the "Company") at a purchase price of $57.00 per Share, net to
the seller in cash, without interest thereon, upon the terms and subject to
the conditions set forth in the Offer to Purchase dated March 20, 2000 (the
"Offer to Purchase") and the related Letter of Transmittal (which, together
with any amendments or supplements thereto, collectively constitute the
"Offer") enclosed herewith.
Holders of Shares whose certificates for such Shares (the "Share
Certificates") are not immediately available, who cannot complete the
procedures for book-entry transfer on a timely basis, or who cannot deliver
all other required documents to ChaseMellon Shareholder Services, L.L.C. (the
"Depositary") prior to the Expiration Date (as defined in the Offer to
Purchase) must tender their Shares according to the guaranteed delivery
procedures set forth in Section 3 of the Offer to Purchase.
The Offer is conditioned upon, among other things, (i) there being validly
tendered and not withdrawn prior to the expiration date of the Offer a number
of Shares that represents at least a majority of the issued and outstanding
Shares on a fully diluted basis and (ii) the waiting period under the Hart-
Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the
regulations thereunder, having expired or been terminated. The Offer is also
subject to other conditions. See Section 15 of the Offer to Purchase.
Please furnish copies of the enclosed materials to those of your clients for
whose accounts you hold Shares registered in your name or in the name of your
nominee.
1. Offer to Purchase dated March 20, 2000;
2. Letter of Transmittal for your use in accepting the Offer and
tendering Shares and for the information of your clients (manually signed
facsimile copies of the Letter of Transmittal may be used to tender
Shares);
3. Notice of Guaranteed Delivery to be used to accept the Offer if Share
Certificates are not immediately available or if such certificates and all
other required documents cannot be delivered to the Depositary, or if the
procedures for book-entry transfer cannot be completed on a timely basis;
<PAGE>
4. A printed form of letter that may be sent to your clients for whose
accounts you hold Shares registered in your name or in the name of your
nominee, with space provided for obtaining such clients' instructions with
regard to the Offer;
5. The letter to stockholders of the Company from James R. Wilson, the
President and Chief Executive Officer of the Company, accompanied by the
Company's Solicitation/Recommendation Statement on Schedule 14D-9 filed
with the Securities and Exchange Commission by the Company, which includes
the recommendation of the Board of Directors of the Company (the "Board of
Directors") that stockholders accept the Offer and tender their Shares to
the Purchaser pursuant to the Offer; and
6. Guidelines of the Internal Revenue Service for Certification of
Taxpayer Identification Number on Substitute Form W-9.
The Board of Directors (i) determined that the terms of the Offer and the
Merger are fair to and in the best interests of the stockholders of the
Company, (ii) approved the Merger Agreement (as defined below) and the
transactions contemplated thereby, including the Offer and the Merger (as
defined below) and (iii) unanimously recommends that the Company's
stockholders accept the Offer and tender their Shares pursuant to the Offer
and approve and adopt the Merger Agreement.
The Offer is being made pursuant to an Agreement and Plan of Merger, dated
as of March 14, 2000 (the "Merger Agreement"), among Alcoa, the Purchaser and
the Company. The Merger Agreement provides for, among other things, the making
of the Offer by the Purchaser, and further provides that the Purchaser will be
merged with and into the Company (the "Merger") as soon as practicable
following the satisfaction or waiver of each of the conditions to the Merger
set forth in the Merger Agreement. Following the Merger, the Company will
continue as the surviving corporation, wholly owned by Alcoa, and the separate
corporate existence of the Purchaser will cease.
In order to take advantage of the Offer, (i) a duly executed and properly
completed Letter of Transmittal and any required signature guarantees, or an
Agent's Message (as defined in the Offer to Purchase) in connection with a
book-entry delivery of Shares, and other required documents should be sent to
the Depositary and (ii) Share Certificates representing the tendered Shares
should be delivered to the Depositary, or such Shares should be tendered by
book-entry transfer into the Depositary's account maintained at the Book-Entry
Transfer Facility (as described in the Offer to Purchase), all in accordance
with the instructions set forth in the Letter of Transmittal and the Offer to
Purchase.
If holders of Shares wish to tender, but it is impracticable for them to
forward their Share Certificates or other required documents prior to the
Expiration Date or to comply with the book-entry transfer procedures on a
timely basis, a tender may be effected by following the guaranteed delivery
procedures specified in Section 3 of the Offer to Purchase.
The Purchaser will not pay any fees or commissions to any broker or dealer
or other person (other than the Depositary, the Information Agent and the
Dealer Manager as described in the Offer to Purchase) for soliciting tenders
of Shares pursuant to the Offer. The Purchaser will, however, upon request,
reimburse you for customary mailing and handling costs incurred by you in
forwarding the enclosed materials to your customers.
The Purchaser will pay or cause to be paid all stock transfer taxes
applicable to its purchase of Shares pursuant to the Offer, except as
otherwise provided in Instruction 6 of the Letter of Transmittal.
WE URGE YOU TO CONTACT YOUR CLIENTS AS PROMPTLY AS POSSIBLE. PLEASE NOTE
THAT THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON MONDAY, APRIL 24, 2000, UNLESS THE OFFER IS EXTENDED.
<PAGE>
Any inquiries you may have with respect to the Offer should be addressed to,
and additional copies of the enclosed materials may be obtained from, the
Information Agent or the undersigned at the addresses and telephone numbers
set forth on the back cover of the Offer to Purchase.
Very truly yours,
SALOMON SMITH BARNEY INC.
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY OTHER PERSON AS AN AGENT OF ALCOA, THE PURCHASER, THE COMPANY, THE
DEALER MANAGER, THE INFORMATION AGENT, THE DEPOSITARY OR ANY AFFILIATE OF ANY
OF THE FOREGOING OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR
MAKE ANY STATEMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER
THAN THE DOCUMENTS ENCLOSED HEREWITH AND THE STATEMENTS CONTAINED THEREIN.
<PAGE>
Offer to Purchase for Cash
All Outstanding Shares of Common Stock
(Including the Associated Rights to Purchase Preferred Stock)
of
Cordant Technologies Inc.
by
Omega Acquisition Corp.
a wholly owned subsidiary of
Alcoa Inc.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M.,
NEW YORK CITY TIME, ON MONDAY, APRIL 24, 2000, UNLESS THE OFFER IS EXTENDED.
To Our Clients:
Enclosed for your consideration is the Offer to Purchase dated March 20,
2000 (the "Offer to Purchase") and a related Letter of Transmittal (which,
together with any amendments or supplements thereto, collectively constitute
the "Offer") in connection with the offer by Omega Acquisition Corp., a
Delaware corporation (the "Purchaser") and a wholly owned subsidiary of Alcoa
Inc., a Pennsylvania corporation ("Alcoa"), to purchase all outstanding shares
of common stock, par value $1.00 per share, of Cordant Technologies Inc., a
Delaware corporation (the "Company"), including the associated rights to
purchase preferred stock (collectively, the "Shares"), at a purchase price of
$57.00 per Share, net to the seller in cash, without interest thereon, upon
the terms and subject to the conditions set forth in the Offer to Purchase and
in the Letter of Transmittal enclosed herewith.
We are the holder of record of Shares for your account. A tender of such
Shares can be made only by us as the holder of record and pursuant to your
instructions. The enclosed Letter of Transmittal is furnished to you for your
information only and cannot be used by you to tender Shares held by us for
your account.
We request instructions as to whether you wish us to tender any or all of
the Shares held by us for your account, upon the terms and subject to the
conditions set forth in the Offer to Purchase. Your attention is invited to
the following:
1. The offer price is $57.00 per Share, net to you in cash, without
interest.
2. The Offer is being made for all outstanding Shares.
3. The Offer is being made pursuant to an Agreement and Plan of Merger,
dated as of March 14, 2000 (the "Merger Agreement"), among Alcoa, the
Purchaser and the Company. The Merger Agreement provides, among other
things, that the Purchaser will be merged with and into the Company (the
"Merger") following the satisfaction or waiver of each of the conditions to
the Merger set forth in the Merger Agreement.
4. The Board of Directors of the Company (i) determined that the terms of
the Offer and the Merger are fair to and in the best interests of the
stockholders of the Company, (ii) approved the Merger Agreement and the
transactions contemplated thereby, including the Offer and the Merger and
(iii) unanimously recommends that the Company's stockholders accept the
Offer and tender their Shares pursuant to the Offer and approve and adopt
the Merger Agreement.
5. The Offer and withdrawal rights will expire at 5:00 p.m., New York
City time, on Monday, April 24, 2000 (the "Expiration Date"), unless the
Offer is extended.
<PAGE>
6. Any stock transfer taxes applicable to the sale of Shares to the
Purchaser pursuant to the Offer will be paid by the Purchaser, except as
otherwise provided in Instruction 6 of the Letter of Transmittal.
The Offer is conditioned upon, among other things, (i) there being validly
tendered and not withdrawn prior to the Expiration Date a number of Shares
that represents at least a majority of the issued and outstanding Shares on a
fully diluted basis and (ii) the waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, and the regulations
thereunder, having expired or been terminated. The Offer is also subject to
other conditions. See Section 15 of the Offer to Purchase.
The Offer is made solely by the Offer to Purchase and the related Letter of
Transmittal and is being made to all holders of Shares. The Purchaser is not
aware of any state where the making of the Offer is prohibited by
administrative or judicial action pursuant to any valid state statute. If the
Purchaser becomes aware of any valid state statute prohibiting the making of
the Offer or the acceptance of Shares pursuant thereto, the Purchaser shall
make a good faith effort to comply with such state statute or seek to have
such statute declared inapplicable to the Offer. If, after such good faith
effort, the Purchaser cannot comply with such state statute, the Offer will
not be made to (nor will tenders be accepted from or on behalf of) holders of
Shares in such state. In those jurisdictions where the securities, blue sky or
other laws require the Offer to be made by a licensed broker or dealer, the
Offer will be deemed to be made on behalf of the Purchaser by Salomon Smith
Barney Inc. in its capacity as Dealer Manager for the Offer or one or more
registered brokers or dealers licensed under the laws of such jurisdiction.
If you wish to have us tender any or all of your Shares, please so instruct
us by completing, executing and returning to us the instruction form set forth
on the reverse side of this letter. An envelope to return your instructions to
us is also enclosed. If you authorize the tender of your Shares, all such
Shares will be tendered unless otherwise specified on the reverse side of this
letter. Your instructions should be forwarded to us in ample time to permit us
to submit a tender on your behalf prior to the Expiration Date.
<PAGE>
Instructions with Respect to the
Offer to Purchase for Cash
All Outstanding Shares of Common Stock
(Including the Associated Rights to Purchase Preferred Stock)
of
Cordant Technologies Inc.
by
Omega Acquisition Corp.
a wholly owned subsidiary of
Alcoa Inc.
The undersigned acknowledge(s) receipt of your letter and the enclosed Offer
to Purchase dated March 20, 2000 and the related Letter of Transmittal of
Omega Acquisition Corp., a Delaware corporation and a wholly owned subsidiary
of Alcoa Inc., a Pennsylvania corporation, all outstanding shares of common
stock, par value $1.00 per share, including the associated rights to purchase
preferred stock (collectively, the "Shares"), of Cordant Technologies Inc. at
a purchase price of $57.00 per Share, net to the seller in cash, without
interest thereon, upon the terms and subject to the conditions set forth in
the Offer to Purchase and the related Letter of Transmittal.
This will instruct you to tender to the Purchaser the number of Shares
indicated below (or, if no number is indicated below, all Shares) that are
held by you for the account of the undersigned, upon the terms and subject to
the conditions set forth in the Offer to Purchase and the related Letter of
Transmittal.
Number of Shares to Be Tendered:* ________
Account No.: _________________
Dated: , 2000
SIGN HERE
___________________________________
___________________________________
Signature(s)
___________________________________
___________________________________
___________________________________
___________________________________
Print Name(s) and Address(es)
___________________________________
___________________________________
___________________________________
Area Code and Telephone Number(s)
___________________________________
Taxpayer Identification or Social
Security Number(s)
- --------
*Unless otherwise indicated, it will be assumed that all Shares held by us for
your account are to be tendered.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
Guidelines for Determining the Proper Identification Number to Give the
Payer. -- Social Security numbers have nine digits separated by two hyphens:
i.e. 000-00-0000. Employer identification numbers have nine digits separated
by only one hyphen: i.e. 00-0000000. The table below will help determine the
number to give the payer.
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For this Type of Account: Give the
SOCIAL
SECURITY
Number of --
- --------------------------------------------------------------------------------
<S> <C>
1. An individual's account The individual
2. Two or more individuals The actual owner
(joint account) of the account
or, if combined
funds, the first
individual on
the account (1)
3. Custodian account of a minor (Uniform Gift to Minors Act) The minor (2)
4. a. The usual revocable savings trust account (grantor is The grantor-
also trustee) trustee (1)
b. So-called trust account that is not a legal or valid The actual owner
trust under state law (1)
5. Sole proprietorship account The owner (3)
</TABLE>
- -------------------------------------------------------------------------------
- -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
For this Type of Account: Give the
EMPLOYER
IDENTIFICATION
Number of --
- --------------------------------------------------------------------------------
<S> <C>
7. A valid trust, estate, or pension trust The legal entity
(Do not furnish
the identifying
number of the
personal
representative
or trustee
unless the legal
entity itself is
not designated
in the account
title.) (4)
8. Corporate account The corporation
9. Association, club, religious, charitable, educational or The organization
other tax-exempt organization account
10. Partnership The partnership
11. A broker or registered nominee The broker or
nominee
12. Account with the Department of Agriculture in the name of The public
a public entity (such as a state or local government, school entity
district, or prison) that receives agricultural program
payments
</TABLE>
- -------------------------------------------------------------------------------
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Show the name of the owner. Either the social security number or the
employer identification number may be furnished.
(4) List first and circle the name of the legal trust, estate, or pension
trust.
Note: If no name is circled when there is more than one name, the number will
be considered to be that of the first name listed.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
Page 2
Obtaining a Number
If you do not have a taxpayer identification number or you do not know your
number, obtain Form SS-5, Application for a Social Security Card (for resident
individuals), Form SS-4, Application for Employer Identification Number (for
businesses and all other entities), or Form W-7, Application for IRS Individ-
ual Taxpayer Identification Number (for alien individuals required to file
U.S. tax returns), at an office of the Social Security Administration or the
Internal Revenue Service.
To complete the Substitute Form W-9, if you do not have a taxpayer identifica-
tion number, check the appropriate box in Part 1(b), sign and date the Form,
and give it to the requester. Generally, you will then have 60 days to obtain
a taxpayer identification number and furnish it to the requester. If the re-
quester does not receive your taxpayer identification number within 60 days,
backup withholding, if applicable, will begin and will continue until you fur-
nish your taxpayer identification number to the requester.
Payees and Payments Exempt from Backup Withholding
Set forth below is a list of payees that are exempt from backup withholding
with respect to all or certain types of payments. For interest and dividends,
all listed payees are exempt except the payee in item (9). For broker transac-
tions, all payees listed in items (1) through (13) and any person registered
under the Investment Advisors Act of 1940 who regularly acts as a broker is
exempt. For payments subject to reporting under Sections 6041 and 6041A, the
payees listed in items (1) through (7) are generally exempt. For barter ex-
change transactions and patronage dividends, the payees listed in items (1)
through (5) are exempt.
(1)A corporation.
(2) An organization exempt from tax under Section 501(a), an IRA, or a custo-
dial account under Section 403(b)(7) if the account satisfies the require-
ments of Section 401(f)(2).
(3) The United States or any agency or instrumentality thereof.
(4) A state, the District of Columbia, a possession of the United States, or
any subdivision or instrumentality thereof.
(5) A foreign government, or a political subdivision, agency or instrumental-
ity thereof.
(6) An international organization or any agency or instrumentality thereof.
(7) A foreign central bank of issue.
(8) A registered dealer in securities or commodities registered in the U.S. or
a possession of the U.S.
(9) A futures commission merchant registered with the Commodity Futures Trad-
ing Commission.
(10) A real estate investment trust.
(11) An entity registered at all times under the Investment Company Act of
1940.
(12) A common trust fund operated by a bank under Section 584(a).
(13) A financial institution.
(14) A middleman known in the investment community as a nominee or custodian.
(15) A trust exempt from tax under Section 664 or described in Section
4947(a)(1).
Payments of dividends and patronage dividends not generally subject to backup
withholding include the following:
. Payments to nonresident aliens subject to withholding under Section 1441.
. Payments to partnerships not engaged in a trade or business in the U.S. and
which have at least one nonresident partner.
. Payments of patronage dividends not paid in money.
. Payments made by certain foreign organizations.
. Section 404(k) distributions made by an ESOP.
Payments of interest not generally subject to backup withholding include the
following:
. Payments of interest on obligations issued by individuals. Note: You may be
subject to backup withholding if this interest is $600 or more and is paid
in the course of the payer's trade or business and you have not provided
your correct taxpayer identification number to the payer.
. Payments of tax-exempt interest (including exempt-interest dividends under
Section 852).
. Payments described in Section 6049(b)(5) to non-resident aliens.
. Payments on tax-free covenant bonds under Section 1451.
. Payments made by certain foreign organizations.
. Mortgage or student loan interest paid to you.
Exempt payees described above should file a Substitute Form W-9 to avoid pos-
sible erroneous backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH
YOUR TAXPAYER IDENTIFICATION NUMBER, WRITE "EXEMPT" IN PART 2 OF THE FORM, AND
RETURN IT TO THE PAYER.
Certain payments other than interest, dividends, and patronage dividends, that
are not subject to information reporting are also not subject to backup with-
holding. For details, see Sections 6041, 6041A, 6042, 6044, 6045, 6049, 6050A
and 6050N and the regulations promulgated thereunder.
Privacy Act Notice.--Section 6109 requires most recipients of dividend, inter-
est, or other payments to give taxpayer identification numbers to payers who
must report the payments to the IRS. The IRS uses the numbers for identifica-
tion purposes. Payers must be given the numbers whether or not recipients are
required to file tax returns. Payers must generally withhold 31% of taxable
interest, dividend, and certain other payments to a payee who does not furnish
a taxpayer identification number to a payer. Certain penalties may also apply.
Penalties
(1) Penalty for Failure to Furnish Taxpayer Identification Number.--If you
fail to furnish your taxpayer identification number to a requester, you are
subject to a penalty of $50 for each such failure unless your failure is due
to reasonable cause and not to willful neglect.
(2) Civil Penalty for False Information with Respect to Withholding.--If you
make a false statement with no reasonable basis which results in no imposition
of backup withholding, you are subject to a penalty of $500.
(3) Criminal Penalty for Falsifying Information.--Falsifying certifications or
affirmations may subject you to criminal penalties including fines and/or im-
prisonment.
FOR ADDITIONAL INFORMATION CONSULT YOUR TAX ADVISOR OR THE INTERNAL REVENUE
SERVICE
<PAGE>
EXHIBIT (a)(8)
This announcement is neither an offer to purchase nor a solicitation of an offer
to sell Shares (as defined below). The Offer (as defined below) is made only by
the Offer to Purchase, dated March 20, 2000, and the related Letter of
Transmittal and any amendments or supplements thereto, and is being made to all
holders of Shares. The Offer is not being made to (nor will tenders be accepted
from or on behalf of) holders of Shares in any jurisdiction in which the making
of the Offer or the acceptance thereof would not be in compliance with the
securities, blue sky or other laws of such jurisdiction. However, the Purchaser
(as defined below) may, in its discretion, take such action as it may deem
necessary to make the Offer in any jurisdiction and extend the Offer to holders
of Shares in such jurisdiction. In those jurisdictions where securities, blue
sky or other laws require the Offer to be made by a licensed broker or dealer,
the Offer shall be deemed to be made on behalf of the Purchaser by Salomon Smith
Barney Inc. ("Salomon Smith Barney" or the "Dealer Manager") or one or more
registered brokers or dealers licensed under the laws of such jurisdiction.
NOTICE OF OFFER TO PURCHASE FOR CASH
ALL OF THE OUTSTANDING SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED RIGHTS TO PURCHASE PREFERRED STOCK)
OF
CORDANT TECHNOLOGIES INC.
AT
$57.00 NET PER SHARE
BY
OMEGA ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
ALCOA INC.
<PAGE>
Omega Acquisition Corp., a Delaware corporation (the "Purchaser") and a
wholly owned subsidiary of Alcoa Inc., a Pennsylvania corporation ("Alcoa"), is
offering to purchase all of the outstanding shares of common stock, par value
$1.00 per share, of Cordant Technologies Inc., a Delaware corporation (the
"Company"), including the associated rights to purchase preferred stock
(collectively, the "Shares"), at price of $57.00 per Share, net to the seller in
cash, on the terms and subject to the conditions set forth in Offer to Purchase,
dated March 20, 2000 (the "Offer to Purchase"), and in the related Letter of
Transmittal (which, together with any amendments or supplements thereto,
collectively constitute the "Offer"). Tendering stockholders who have Shares
registered in their names and who tender directly to ChaseMellon Shareholder
Services, L.L.C. (the "Depositary") will not be charged brokerage fees or
commissions or, subject to Instruction 6 of the Letter of Transmittal, transfer
taxes on the purchase of Shares pursuant to the Offer. Stockholders who hold
their Shares through a broker or bank should consult such institution as to
whether it charges any service fees. The Purchaser will pay all charges and
expenses of the Dealer Manager, the Depositary and Morrow & Co., Inc., which is
acting as the information agent (the "Information Agent"), incurred in
connection with the Offer. Following the consummation of the Offer, the
Purchaser intends to effect the Merger described below.
- --------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 5:00 P.M., NEW YORK CITY
TIME, ON MONDAY, APRIL 24, 2000, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
The Offer is conditioned upon, among other things, (i) there being validly
tendered and not withdrawn prior to the expiration date of the Offer a number
Shares that represents at least a majority of the issued and outstanding Shares
on a fully diluted basis and (ii) the waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, and the regulations thereunder,
having expired or been terminated. The Offer is also subject to other
conditions. See Section 15 of the Offer to Purchase.
The Offer is being made pursuant to the Agreement and Plan of Merger,
dated as of March 14, 2000 (the "Merger Agreement"), among Alcoa, the Purchaser
and the Company. The purpose of the Offer is for Alcoa, through the Purchaser,
to acquire a majority voting interest in the Company as the first step in
acquiring the entire equity interest in the Company. The Merger Agreement
provides that, among other things, the Purchaser will make the Offer and that as
promptly as practicable after the purchase of Shares pursuant to the Offer and
the satisfaction or waiver of the other conditions set forth in the Merger
Agreement and in accordance with relevant provisions of the General Corporation
Law of the State of Delaware (the "DGCL"), the Purchaser will be merged with and
into the Company, with the Company continuing as the surviving corporation (the
"Merger"). At the effective time of the Merger (the "Effective Time"), each
Share issued and outstanding immediately prior to the Effective Time (other
than Shares owned by Alcoa or any of its subsidiaries or by the Company or any
of its subsidiaries, all of which will be cancelled, and other than Shares that
are held by stockholders, if any, who properly exercise their dissenters'
rights under the DGCL) will be converted into the right to receive $57.00 in
cash, or any higher price that is paid in the Offer, without interest thereon.
THE BOARD OF DIRECTORS OF THE COMPANY (I) DETERMINED THAT THE TERMS OF THE
OFFER AND THE MERGER ARE FAIR TO AND IN THE BEST INTERESTS OF THE STOCKHOLDERS
OF THE COMPANY, (II) APPROVED THE MERGER AGREEMENT AND THE TRANSACTIONS
CONTEMPLATED THEREBY, INCLUDING THE OFFER AND THE MERGER AND (III) UNANIMOUSLY
RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR
SHARES PURSUANT TO THE OFFER AND APPROVE AND ADOPT THE MERGER AGREEMENT.
For purposes of the Offer, the Purchaser will be deemed to have accepted
for payment, and thereby purchased, Shares validly tendered and not properly
withdrawn as, if and when the Purchaser gives oral or written notice to the
Depositary of the Purchaser's acceptance of such Shares for payment pursuant to
the Offer. In all cases, on the terms and subject to the conditions of the
Offer, payment for Shares purchased pursuant to the Offer will be made by
deposit of the purchase price with the Depositary, which will act as agent for
tendering stockholders for the purpose of receiving payment from the Purchaser
and transmitting such payment to tendering stockholders. Under no circumstances
will interest on the purchase price of Shares be paid by the Purchaser because
of any delay in making any payment. Payment for Shares tendered and accepted for
payment pursuant to the Offer will be made only after the timely receipt by the
Depositary of (i) certificates for such Shares or timely confirmation of a book-
entry transfer of such Shares into the Depositary's account at the Book-Entry
Transfer Facility (as defined in the Offer to Purchase) pursuant to the
procedures set forth in the Offer to Purchase, (ii) a properly completed and
duly executed Letter of Transmittal (or manually signed facsimile thereof) with
all required signature guarantees or, in the case of book-entry transfer, an
Agent's Message (as defined in the Offer the Purchase), and (iii) any other
documents required by the Letter of Transmittal.
<PAGE>
The Purchaser may, without the consent of the Company, (i) extend the Offer
beyond the scheduled expiration date if any of the conditions to its obligation
to accept for payment and to pay for the Shares shall not be satisfied or, to
the extent permitted by the Merger Agreement, waived by 5:00 p.m., New York City
time, on Monday, April 24, 2000 (or any other time then set as the Expiration
Date), or (ii) extend the Offer for any period required by any rule, regulation
or interpretation of the Securities and Exchange Commission applicable to the
Offer other than Rule 14e-5 promulgated under the Securities Exchange Act of
1934 (the "Exchange Act"). Unless the Company advises the Purchaser that it does
not wish the Offer to be extended, the Purchaser shall extend the Offer from
time to time until the earlier of (a) 30 days after the date on which certain
regulatory conditions are satisfied or (b) September 30, 2000, in the event that
on the Expiration Date all of the conditions to the Offer have not been
satisfied or waived as permitted by the Merger Agreement. Any extension
described in clause (i) of the first sentence in this paragraph or described in
the preceding sentence will not exceed the lesser of (1) ten business days or
(2) such small number of days that the Purchaser reasonably believes it
necessary to cause the conditions to the Offer to be satisfied. If all
conditions to the Offer have been satisfied or waived, the Purchaser will accept
for payment and pay for all Shares validly tendered and not withdrawn at such
time (which Shares may not thereafter be withdrawn) and extend the Offer to
provide a "subsequent offering period" for at least three business days, during
which time stockholders may tender, but not withdraw, their Shares and receive
the Offer consideration. The Purchaser may not extend the Offer during the
subsequent offering period for more than 20 business days (for all such
extensions). The term "Expiration Date" means 5:00 p.m., New York City time, on
Monday, April 24, 2000 unless the Purchaser shall have extended the period of
time for which the Offer is open, in which event the term "Expiration Date"
shall mean the latest time and date at which the Offer, as so extended by the
Purchaser, shall expire.
Any extension of the period during which the Offer is open will be
followed, as promptly as practicable, by public announcement thereof, such
announcement to be issued not later than 9:00 a.m., New York City time, on the
next business day after the previously scheduled Expiration Date. During any
such extension, all Shares previously tendered and not withdrawn will remain
subject to the Offer, subject to the rights of a tendering stockholder to
withdraw such stockholder's Shares (except during the subsequent offering
period).
Shares tendered pursuant to the Offer may be withdrawn at any time prior to
the Expiration Date (except during the subsequent offering period) and, unless
theretofore accepted for payment pursuant to the Offer, also may be withdrawn at
any time after Thursday, May 18 2000. Except as otherwise provided in Section 4
of the Offer to Purchase, tenders of Shares made pursuant to the Offer are
irrevocable. For a withdrawal of Shares tendered pursuant to the Offer to be
effective, a written, telegraphic or facsimile transmission notice of withdrawal
must be timely received by the Depositary at one of its addresses set forth on
the back cover of the Offer to Purchase. Any notice of withdrawal must specify
the name, address and taxpayer identification number of the person who tendered
the Shares to be withdrawn, the number of Shares to be withdrawn and the name of
registered holder of such shares, if different from that of the person who
tendered the Shares. If certificates for Shares to be withdrawn have been
delivered or otherwise identified to the Depositary, then, prior to the physical
release of such certificates, the serial numbers shown on such certificates must
be submitted to the Depositary and, unless such Shares have been tendered for
the account of an Eligible Instiution (as defined in the Offer to Purchase), the
signature on the notice of withdrawal must be guaranteed by an Eligible
Insitution. If Shares have been tendered pursuasnt to the procedures for book-
entry transfer as set forth in the Offer to Purchase, any notice of withdrawal
must also specify the name and number of the account at the Book-Entry Transfer
Facility to be credited with the withdrawn Shares. All questions as to the form
and validity (including time of receipt) of notices of withdrawal will be
determined by the Purchaser, in its sole discretion, and its determination will
be final and binding on all parties.
The receipt of cash in exchange for Shares pursuant to the Offer or the
Merger will be a taxable for U.S. federal income tax purposes and may also be a
taxable transaction under applicable state, local or foreign tax laws. In
general, a stockholder who receives cash in exchange for Shares pursuant to the
Offer or the Merger will recognize gain or loss for U.S. federal income tax
purposes equal to the difference, if any, between the amount of cash received
and such stockholder's adjusted tax basis in the Shares exchanged therefor.
Provided that such Shares constitute capital assets in the hands of the
stockholder, such gain or loss will be capital gain or loss, and will be
long-term capital gain or loss if the holder has held the Shares for more than
one year at the time of sale. The maximum U.S. federal income tax rate
applicable to individual taxpayers on long-term capital gains is 20%, and the
deductibility of capital losses is subject to limitations. All stockholders
should consult with their own tax advisors as to the particular tax consequences
of the Offer and the Merger to them, including the applicability and effect of
the alternative minimum tax and any state, local or foreign income and other tax
laws and of changes in such tax laws. For a more complete decription of certain
U.S. federal income tax consequences of the Offer and the Merger see Section 5
of Offer to Purchase.
The information required to be disclosed by Paragraph (d)(1) of Rule 14d-6
of the General Rules and Regulations under the Exchange Act is contained in the
Offer to Purchase and is incorporated herein by reference.
<PAGE>
- --------------------------------------------------------------------------------
The Company has provided to the Purchaser its list of stockholders and
security position listings for the purpose of disseminating the Offer to holders
of Shares. The Offer to Purchase, the related Letter of Transmittal and other
related materials are being mailed to record holders of Shares and will be
furnished to brokers, dealers, commercial banks, trust companies and similar
persons whose names, or the names of whose nominees, appear on the stockholder
list or, if applicable, who are listed as participants in a clearing agency's
security position listing, for subsequent transmittal to beneficial owners of
Shares.
THE OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION THAT SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE
WITH RESPECT TO THE OFFER.
Questions and requests for assistance and copies of the Offer to Purchase,
the Letter of Transmittal and all other tender offer materials may be directed
to the Information Agent or the Dealer Manager at their respective addresses and
telephone numbers set forth below and will be furnished promptly at the
Purchaser's expense. The Purchaser will not pay any fees or commissions to any
broker or dealer or any other person (other than the Dealer Manager and the
Information Agent) for soliciting tenders of Shares pursuant to the Offer.
The Information Agent for the Offer is:
MORROW & CO., INC.
445 Park Avenue, 5th Floor
New York, NY 10022
Call Collect (212) 754-8000
Banks and Brokerage Firms Call: (800) 662-5200
Stockholders Please Call: (800) 566-9061
The Dealer Manager for the Offer is:
SALOMON SMITH BARNEY
388 Greenwich Street
New York, NY 10013
Call Toll Free: (877) 319-4978
March 20, 2000
- --------------------------------------------------------------------------------
<PAGE>
EXHIBIT D(1)
================================================================================
AGREEMENT AND PLAN OF MERGER
among
ALCOA INC.,
OMEGA ACQUISITION CORP.
and
CORDANT TECHNOLOGIES INC.
Dated as of March 14, 2000
================================================================================
<PAGE>
TABLE OF CONTENTS
Page
ARTICLE I
Section 1.1 The Offer................................................... 2
Section 1.2 Company Actions............................................. 4
Section 1.3 Directors of the Company.................................... 5
ARTICLE II
THE MERGER
Section 2.1 The Merger.................................................. 6
Section 2.2 Closing..................................................... 6
Section 2.3 Effective Time.............................................. 7
Section 2.4 Effects of the Merger....................................... 7
Section 2.5 Certificate of Incorporation; By-laws....................... 7
Section 2.6 Directors; Officers of Surviving Corporation................ 8
Section 2.7 Conversion of Securities.................................... 8
Section 2.8 Exchange of Certificates.................................... 9
Section 2.9 Appraisal Rights............................................ 11
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Section 3.1 Organization, Qualification, Etc............................ 12
Section 3.2 Capital Stock............................................... 13
Section 3.3 Corporate Authority Relative to this Agreement; No Violation 15
Section 3.4 Reports and Financial Statements............................ 16
Section 3.5 No Undisclosed Liabilities.................................. 18
Section 3.6 No Violation of Law......................................... 18
Section 3.7 Environmental Matters....................................... 18
Section 3.8 Employee Benefit Plans; ERISA............................... 20
Section 3.9 Absence of Certain Changes or Events........................ 22
Section 3.10 Litigation.................................................. 23
Section 3.11 Schedule 14D-9; Offer Documents; and Proxy Statement........ 23
Section 3.12 Intellectual Property....................................... 23
Section 3.13 Tax Matters................................................. 24
i
<PAGE>
Page
----
Section 3.14 Opinion of Financial Advisor................................ 26
Section 3.15 Required Vote of the Company Stockholders................... 26
Section 3.16 Employment Matters.......................................... 26
Section 3.17 Rights Plan................................................. 27
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF ALCOA AND THE PURCHASER
Section 4.1 Organization, Qualification, Etc............................ 27
Section 4.2 Corporate Authority Relative to this Agreement; No Violation 28
Section 4.3 Offer Documents; Proxy Statement; Schedule 14D-9............ 29
Section 4.4 Financing................................................... 29
Section 4.5 Opinion of Financial Advisor................................ 29
Section 4.6 Ownership of Capital Stock.................................. 30
ARTICLE V
COVENANTS AND AGREEMENTS
Section 5.1 Conduct of Business Prior to the Effective Time............. 30
Section 5.2 Access; Confidentiality..................................... 33
Section 5.3 Special Meeting; Proxy Statement............................ 34
Section 5.4 Reasonable Best Efforts; Further Assurances................. 35
Section 5.5 Employee Stock Options and Other Employee Benefits.......... 37
Section 5.6 Takeover Statute............................................ 39
Section 5.7 No Solicitation by the Company.............................. 39
Section 5.8 Public Announcements........................................ 42
Section 5.9 Indemnification; Insurance.................................. 42
Section 5.10 Disclosure Schedule Supplements............................. 43
Section 5.11 Howmet Acquisition.......................................... 44
ARTICLE VI
CONDITIONS TO THE MERGER
Section 6.1 Conditions to Each Party's Obligation to Effect the Merger.. 43
ii
<PAGE>
Page
----
ARTICLE VII
TERMINATION
Section 7.1 Termination................................................. 45
Section 7.2 Effect of Termination....................................... 46
Section 7.3 Termination Fee............................................. 46
ARTICLE VIII
MISCELLANEOUS
Section 8.1 No Survival of Representations and Warranties............... 47
Section 8.2 Expenses.................................................... 47
Section 8.3 Counterparts; Effectiveness................................. 47
Section 8.4 Governing Law............................................... 47
Section 8.5 Notices..................................................... 47
Section 8.6 Assignment; Binding Effect.................................. 48
Section 8.7 Severability................................................ 49
Section 8.8 Enforcement of Agreement.................................... 49
Section 8.9 Entire Agreement; No Third-Party Beneficiaries.............. 49
Section 8.10 Headings.................................................... 49
Section 8.11 Definitions................................................. 49
Section 8.12 Finders or Brokers.......................................... 50
Section 8.13 Amendment or Supplement..................................... 50
Section 8.14 Extension of Time, Waiver, Etc.............................. 50
iii
<PAGE>
Index of Defined Terms
Defined Term Section
- ------------ -------
Acquisition Agreement.................................................... 5.7(b)
Acquisition Proposal..................................................... 5.7(a)
affiliates................................................................. 8.11
Agreement.......................................................... Introduction
Alcoa.............................................................. Introduction
Alcoa and Purchaser Agreements........................................... 4.2(b)
Alcoa Common Stock....................................................... 5.5(a)
Alcoa Disclosure Schedule............................... Article IV Introduction
Asset Transaction........................................................ 5.7(a)
Business Combination Transaction......................................... 5.7(a)
CERCLA................................................................... 3.7(d)
Certificate of Merger....................................................... 2.3
Certificate of Ownership and Merger......................................... 2.3
Certificates............................................................. 2.8(b)
Closing..................................................................... 2.2
Closing Date................................................................ 2.2
Code..................................................................... 2.8(f)
Company............................................................ Introduction
Company Affiliated Group................................................ 3.13(a)
Company Agreements....................................................... 3.3(b)
Company Common Stock................................................... Recitals
Company Disclosure Schedule............................ Article III Introduction
Company Employee......................................................... 5.5(b)
Company Option Plans..................................................... 5.5(a)
Company Plans............................................................ 3.8(a)
Company Preferred Stock.................................................. 3.2(a)
Company Representatives.................................................. 5.7(a)
Company SEC Reports...................................................... 3.4(e)
Company Stockholder Approval............................................... 3.15
Company Title IV Plan.................................................... 3.8(d)
Computer Software....................................................... 3.12(c)
Confidentiality Agreement................................................ 5.2(b)
control.................................................................... 8.11
Copyrights.............................................................. 3.12(c)
DGCL................................................................... Recitals
i
<PAGE>
Defined Term Section
- ------------ -------
Disclosure Schedule..................................... Article IV Introduction
Dissenting Shares........................................................... 2.9
Dissenting Stockholders..................................................... 2.9
Drop Dead Date........................................................... 7.1(b)
Effective Time.............................................................. 2.3
Employee Stock Options................................................... 5.5(a)
Environmental Claim................................................... 3.7(f)(i)
Environmental Law.................................................... 3.7(f)(ii)
Environmental Permits.................................................... 3.7(a)
ERISA.................................................................... 3.8(a)
ERISA Affiliate.......................................................... 3.8(a)
Exchange Act............................................................. 1.1(a)
Exchange Agent........................................................... 2.8(a)
Foreign Plans............................................................ 3.8(a)
GAAP..................................................................... 3.4(e)
Governmental Entity...................................................... 3.3(b)
Group SEC Reports........................................................ 3.4(e)
Hazardous Materials................................................. 3.7(f)(iii)
Howmet................................................................... 3.1(b)
Howmet Common Stock...................................................... 3.1(b)
Howmet Options........................................................... 3.2(b)
Howmet Preferred Stock................................................... 3.2(b)
Howmet SEC Reports....................................................... 3.4(e)
Howmet Transaction......................................................... 5.11
HSR Act.................................................................. 3.3(b)
Incipient Superior Proposal.............................................. 5.7(a)
Including.................................................................. 8.11
Indemnified Parties...................................................... 5.9(a)
Independent Director Approval............................................ 1.3(c)
Intellectual Property................................................... 3.12(c)
IRS...................................................................... 3.8(b)
Lien..................................................................... 3.1(b)
Material Adverse Effect.................................................. 3.1(a)
Merger................................................................. Recitals
Merger Consideration..................................................... 2.7(b)
Minimum Condition........................................................ 1.1(a)
New Share Number......................................................... 5.5(a)
ii
<PAGE>
Defined Term Section
- ------------ -------
Offer.................................................................. Recitals
Offer Documents.......................................................... 1.1(b)
Offer Price............................................................ Recitals
Offer to Purchase........................................................ 1.1(b)
Patents................................................................. 3.12(c)
Person..................................................................... 8.11
Policies................................................................. 5.9(c)
Proxy Statement...................................................... 5.3(a)(ii)
Purchase Date............................................................ 5.5(a)
Purchaser.......................................................... Introduction
Regulatory Condition....................................... Annex A Introduction
Rights................................................................... 3.2(c)
Rights Agreement......................................................... 3.2(a)
Schedule 14D-9........................................................... 1.2(b)
Schedule TO.............................................................. 1.1(b)
SEC...................................................................... 1.1(a)
Securities Act........................................................... 3.3(b)
Shares................................................................. Recitals
Significant Subsidiaries................................................... 8.11
Special Meeting....................................................... 5.3(a)(i)
Subsidiaries............................................................... 8.11
Superior Proposal........................................................ 5.7(a)
Surviving Corporation....................................................... 2.1
Tax Return.............................................................. 3.13(c)
Taxes................................................................... 3.13(c)
Termination Date............................................................ 5.1
Termination Fee............................................................. 7.3
Trademarks.............................................................. 3.12(c)
iii
<PAGE>
AGREEMENT AND PLAN OF MERGER, dated as of March 14, 2000 (the
"Agreement"), among ALCOA INC., a Pennsylvania corporation ("Alcoa"), OMEGA
ACQUISITION CORP., a Delaware corporation (the "Purchaser"), and CORDANT
TECHNOLOGIES INC., a Delaware corporation (the "Company").
WHEREAS, the Boards of Directors of Alcoa, the Purchaser and the
Company deem it advisable and in the best interests of their respective
stockholders that Alcoa acquire the Company upon the terms and subject to the
conditions provided for in this Agreement;
WHEREAS, in furtherance thereof it is proposed that the acquisition be
accomplished by the Purchaser commencing a cash tender offer (as it may be
amended from time to time as permitted by this Agreement, the "Offer") to
purchase all of the issued and outstanding shares of common stock, par value
$1.00 per share, of the Company (the "Company Common Stock") and the associated
Rights (the shares of Company Common Stock and any associated Rights are
referred to herein as "Shares"), for $57.00 per Share (such amount or any
greater amount per Share paid pursuant to the Offer being hereinafter referred
to as the "Offer Price"), subject to applicable withholding Taxes, net to the
seller in cash, upon the terms and subject to the conditions set forth in this
Agreement;
WHEREAS, the Board of Directors of the Company has approved the Offer
and the Merger and resolved to recommend that holders of Shares tender their
Shares pursuant to the Offer and approve and adopt this Agreement and the
Merger; and
WHEREAS, the Boards of Directors of Alcoa (on its own behalf and as
the sole stockholder of the Purchaser), the Purchaser and the Company have each
approved this Agreement and the merger of the Purchaser with and into the
Company (the "Merger") in accordance with the General Corporation Law of the
State of Delaware (the "DGCL"), in the case of each of the Company and the
Purchaser, and in accordance with the Pennsylvania Business Corporation Law, in
the case of Alcoa, and upon the terms and conditions set forth in this
Agreement.
NOW, THEREFORE, in consideration of the representations, warranties,
covenants and agreements contained in this Agreement, and intending to be
legally bound hereby, Alcoa, the Purchaser and the Company agree as follows:
<PAGE>
ARTICLE I
Section 1.1 The Offer.
---------
(a) Provided that this Agreement shall not have been terminated in
accordance with Section 7.1 and none of the events set forth in paragraphs (a)
through (i) of Annex A hereto shall have occurred or be existing (and shall not
have been waived by the Purchaser), the Purchaser shall commence (within the
meaning of Rule 14d-2 under the Securities Exchange Act of 1934, as amended (the
"Exchange Act")) the Offer as promptly as reasonably practicable after the date
hereof, but in no event later than five business days after the public
announcement of the execution of this Agreement. The obligation of the
Purchaser to accept for payment and pay for Shares tendered pursuant to the
Offer shall be subject only to the satisfaction of the condition that there be
validly tendered and not withdrawn prior to the expiration of the Offer that
number of Shares which represents at least a majority of the then outstanding
Shares on a fully diluted basis (the "Minimum Condition") and to the
satisfaction or waiver by the Purchaser of the other conditions set forth in
Annex A hereto. The Company agrees that no Shares held by the Company or any of
its Subsidiaries will be tendered to the Purchaser pursuant to the Offer. The
Purchaser expressly reserves the right to waive any of such conditions (other
than the Minimum Condition), to increase the price per Share payable in the
Offer and to make any other changes in the terms of the Offer; provided,
however, that no change may be made without the prior written consent of the
Company which decreases the price per Share payable in the Offer, reduces the
maximum number of Shares to be purchased in the Offer, changes the form of
consideration to be paid in the Offer, modifies or amends any of the conditions
set forth in Annex A hereto, imposes conditions to the Offer in addition to the
conditions set forth in Annex A hereto, waives the Minimum Condition or makes
other changes in the terms and conditions of the Offer that are in any manner
adverse to the holders of Shares or, except as provided below, extends the
Offer. Subject to the terms of the Offer and this Agreement and the
satisfaction or earlier waiver of all the conditions of the Offer set forth in
Annex A hereto as of any expiration date of the Offer, the Purchaser will accept
for payment and pay for all Shares validly tendered and not withdrawn pursuant
to the Offer as soon as it is permitted to do so under applicable law.
Notwithstanding the foregoing, the Purchaser may, without the consent of the
Company, (i) extend the Offer beyond the scheduled expiration date, which shall
be 25 business days following the date of commencement of the Offer, if, at the
scheduled expiration of the Offer, any of the conditions to the Purchaser's
obligation to accept for payment and to pay for the Shares shall not be
satisfied or, to the extent permitted by this Agreement, waived or (ii) extend
2
<PAGE>
the Offer for any period required by any rule, regulation or interpretation of
the Securities and Exchange Commission (the "SEC") or the staff thereof
applicable to the Offer, other than Rule 14e-5 promulgated under the Exchange
Act. Unless the Company advises the Purchaser that it does not wish the
Purchaser to extend the Offer, the Purchaser shall extend the Offer from time to
time until the earlier of (A) the date that is 30 days after the date on which
the Regulatory Condition (as defined in Annex A) is satisfied or (B) the Drop
Dead Date, in the event that, at the then-scheduled expiration date, all of the
conditions of the Offer set forth in Annex A hereto have not been satisfied or
waived as permitted by this Agreement. Any extension of the Offer pursuant to
the preceding sentence of clause (i) of the second preceding sentence or this
Section 1.1 shall not exceed the lesser of ten business days or such fewer
number of days that the Purchaser reasonably believes are necessary to cause the
conditions of the Offer set forth in Annex A hereto to be satisfied. The
Purchaser shall provide a "subsequent offering period" (as contemplated by Rule
14d-11 under the Exchange Act) of not less than three business days following
its acceptance for payment of Shares in the Offer. On or prior to the dates
that the Purchaser becomes obligated to accept for payment and pay for Shares
pursuant to the Offer, Alcoa shall provide or cause to be provided to the
Purchaser the funds necessary to pay for all Shares that the Purchaser becomes
so obligated to accept for payment and pay for pursuant to the Offer. The Offer
Price shall, subject to any required withholding of Taxes, be net to the seller
in cash, upon the terms and subject to the conditions of the Offer.
(b) As promptly as practicable on the date of commencement of the
Offer, the Purchaser shall file with the SEC a Tender Offer Statement on
Schedule TO (together with all amendments and supplements thereto, the "Schedule
TO") with respect to the Offer. The Schedule TO shall contain or incorporate by
reference an offer to purchase (the "Offer to Purchase") and forms of the
related letter of transmittal and all other ancillary Offer documents
(collectively, together with all amendments and supplements thereto, the "Offer
Documents"). Alcoa and the Purchaser shall cause the Offer Documents to be
disseminated to the holders of the Shares as and to the extent required by
applicable federal securities laws. Alcoa and the Purchaser, on the one hand,
and the Company, on the other hand, will promptly correct any information
provided by it for use in the Offer Documents if and to the extent that it shall
have become false or misleading in any material respect, and the Purchaser will
cause the Offer Documents as so corrected to be filed with the SEC and to be
disseminated to holders of the Shares, in each case as and to the extent
required by applicable federal securities laws. The Company and its counsel
shall be given a reasonable opportunity to review and comment upon the Schedule
TO before it is filed with the SEC. In addition, Alcoa and the Purchaser agree
to provide the Company and its counsel with any comments,
3
<PAGE>
whether written or oral, that Alcoa or the Purchaser or their counsel may
receive from time to time from the SEC or its staff with respect to the Offer
Documents promptly after the receipt of such comments and to consult with the
Company and its counsel prior to responding to any such comments.
Section 1.2 Company Actions.
---------------
(a) The Company hereby approves of and consents to the Offer and
represents and warrants that the Company's Board of Directors, at a meeting duly
called and held, has (i) determined that the terms of the Offer and the Merger
are fair to and in the best interests of the stockholders of the Company, (ii)
approved this Agreement and approved the transactions contemplated hereby,
including the Offer and the Merger and (iii) resolved to recommend that the
stockholders of the Company accept the Offer, tender their Shares to the
Purchaser thereunder and approve and adopt this Agreement and the Merger.
Subject to Section 5.7, the Company hereby consents to the inclusion in the
Offer Documents of the recommendation of the Board described in the immediately
preceding sentence.
(b) As promptly as practicable on the date of commencement of the
Offer, the Company shall file with the SEC a Solicitation/Recommendation
Statement on Schedule 14D-9 (together with all amendments and supplements
thereto, the "Schedule 14D-9") which shall contain the recommendation referred
to in clause (iii) of Section 1.2(a) hereof. The Company further agrees to take
all steps necessary to cause the Schedule 14D-9 to be disseminated to holders of
the Shares as and to the extent required by applicable federal securities laws.
The Company, on the one hand, and each of Alcoa and the Purchaser, on the other
hand, will promptly correct any information provided by it for use in the
Schedule 14D-9 if and to the extent that it shall have become false or
misleading in any material respect, and the Company will cause the Schedule 14D-
9 as so corrected to be filed with the SEC and to be disseminated to holders of
the Shares, in each case as and to the extent required by applicable federal
securities laws. Alcoa and its counsel shall be given a reasonable opportunity
to review and comment upon the Schedule 14D-9 before it is filed with the SEC.
In addition, the Company agrees to provide Alcoa, the Purchaser and their
counsel with any comments, whether written or oral, that the Company or its
counsel may receive from time to time from the SEC or its staff with respect to
the Schedule 14D-9 promptly after the receipt of such comments and to consult
with Alcoa, the Purchaser and their counsel prior to responding to any such
comments.
4
<PAGE>
(c) The Company shall promptly furnish the Purchaser with mailing
labels containing the names and addresses of all record holders of Shares and
with security position listings of Shares held in stock depositories, each as of
a recent date, together with all other available listings and computer files
containing names, addresses and security position listings of record holders and
non-objecting beneficial owners of Shares. The Company shall furnish the
Purchaser with such additional information, including, without limitation,
updated listings and computer files of stockholders, mailing labels and security
position listings, and such other assistance as Alcoa, the Purchaser or their
agents may reasonably require in communicating the Offer to the record and
beneficial holders of Shares. Subject to the requirements of applicable law,
and except for such steps as are necessary to disseminate the Offer Documents
and any other documents necessary to consummate the Offer or the Merger, Alcoa
and the Purchaser shall hold in confidence the information contained in such
labels, listings and files, shall use such information solely in connection with
the Offer and the Merger, and, if this Agreement is terminated in accordance
with Section 7.1 or if the Offer is otherwise terminated, shall promptly deliver
or cause to be delivered to the Company all copies of such information, labels,
listings and files then in their possession or in the possession of their agents
or representatives.
Section 1.3 Directors of the Company.
------------------------
(a) Promptly upon the purchase of and payment for Shares by the
Purchaser or any of its affiliates pursuant to the Offer, Alcoa shall be
entitled to designate such number of directors, rounded up to the next whole
number, on the Board of Directors of the Company as is equal to the product
obtained by multiplying the total number of directors on such Board (giving
effect to the directors designated by Alcoa pursuant to this sentence) by the
percentage that the number of Shares so purchased and paid for bears to the
total number of Shares then outstanding. In furtherance thereof, the Company
shall, upon request of the Purchaser, promptly increase the size of its Board of
Directors or exercise its best efforts to secure the resignations of such number
of directors, or both, as is necessary to enable Alcoa's designees to be so
elected to the Company's Board and, subject to Section 14(f) of the Exchange Act
and Rule 14f-1 promulgated thereunder, shall cause Alcoa's designees to be so
elected. At such time, the Company shall, if requested by Alcoa, also cause
directors designated by Alcoa to constitute at least the same percentage
(rounded up to the next whole number) as is on the Company's Board of Directors
of each committee of the Company's Board of Directors. Notwithstanding the
foregoing, if Shares are purchased pursuant to the Offer, there shall be until
the Effective Time at least two members of the Company's Board of Directors who
are directors on the date hereof and are not employees of the Company.
5
<PAGE>
(b) The Company shall promptly take all actions required pursuant to
Section 14(f) of the Exchange Act and Rule 14f-1 promulgated thereunder in order
to fulfill its obligations under Section 1.3(a), including mailing to
stockholders together with the Schedule 14D-9 the information required by such
Section 14(f) and Rule 14f-1 as is necessary to enable Alcoa's designees to be
elected to the Company's Board of Directors. Alcoa and the Purchaser will
supply the Company and be solely responsible for any information with respect to
them and their nominees, officers, directors and affiliates required by such
Section 14(f) and Rule 14f-1.
(c) Following the election of Alcoa's designees to the Company's Board
of Directors pursuant to this Section 1.3, prior to the Effective Time (i) any
amendment or termination of this Agreement by the Company, (ii) any extension or
waiver by the Company of the time for the performance of any of the obligations
or other acts of Alcoa or the Purchaser under this Agreement, or (iii) any
waiver of any of the Company's rights hereunder shall, in any such case, require
the concurrence of a majority of the directors of the Company then in office who
neither were designated by the Purchaser nor are employees of the Company (the
"Independent Director Ap proval").
ARTICLE II
THE MERGER
Section 2.1 The Merger. Upon the terms and subject to the
----------
conditions set forth in this Agreement, and in accordance with the DGCL, at the
Effective Time the Purchaser shall merge with and into the Company, and the
separate corporate existence of the Purchaser shall thereupon cease, and the
Company shall be the surviving corporation in the Merger (the "Surviving
Corporation"). The Surviving Corporation shall possess all the rights,
privileges, powers and franchises of a public as well as of a private nature and
shall be subject to all of the restrictions, disabilities, duties, debts and
obligations of the Company and the Purchaser, all as provided in the DGCL.
Section 2.2 Closing. The closing of the Merger (the "Closing")
-------
will take place at 10:00 a.m. on a date to be specified by the parties (the
"Closing Date"), which shall be no later than the second business day after
satisfaction or waiver of the conditions set forth in Article VI, unless another
time or date, or both, are agreed to in writing by the parties hereto. The
Closing will be held at the offices of Skadden, Arps,
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Slate, Meagher & Flom LLP, Four Times Square, New York, New York, unless another
place is agreed to by the parties hereto.
Section 2.3 Effective Time. Subject to the provisions of this
--------------
Agreement, on the Closing Date the parties shall file with the Secretary of
State of the State of Delaware a certificate of merger in accordance with
Section 251 of the DGCL (the "Certificate of Merger") or a certificate of
ownership and merger (the "Certificate of Ownership and Merger") in accordance
with Section 253 of the DGCL, as applicable, executed in accordance with the
relevant provisions of the DGCL and shall make all other filings or recordings
required under the DGCL in order to effect the Merger. The Merger shall become
effective upon the filing of the Certificate of Merger or Certificate of
Ownership and Merger or at such other time as is agreed by the parties hereto
and specified in the Certificate of Merger or Certificate of Ownership and
Merger (the time at which the Merger becomes fully effective being hereinafter
referred to as the "Effective Time").
Section 2.4 Effects of the Merger. The Merger shall have the
---------------------
effects set forth in Section 259 of the DGCL.
Section 2.5 Certificate of Incorporation; By-laws.
-------------------------------------
(a) At the Effective Time, the Certificate of Incorporation of the
Purchaser, as in effect immediately prior to the Effective Time, shall be the
Certificate of Incorporation of the Surviving Corporation; provided, however,
that Article FIRST of the Certificate of Incorporation of the Surviving
Corporation shall be amended to read in its entirety as follows: "FIRST: The
name of the corporation is Cordant Technologies Inc." and as so amended shall be
the Certificate of Incorporation of the Surviving Corporation until thereafter
amended as provided by the DGCL and such Certificate of Incorporation.
(b) At the Effective Time, the By-laws of the Purchaser, as in effect
immediately prior to the Effective Time, shall be the By-laws of the Surviving
Corporation until thereafter amended as provided by the DGCL, the Certificate of
Incorporation of the Surviving Corporation and such By-laws.
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Section 2.6 Directors; Officers of Surviving Corporation.
--------------------------------------------
(a) The directors of the Purchaser at the Effective Time shall be the
directors of the Surviving Corporation until their respective successors are
duly elected and qualified or their earlier death, resignation or removal in
accordance with the Certificate of Incorporation and By-laws of the Surviving
Corporation.
(b) The officers of the Company at the Effective Time shall be the
officers of the Surviving Corporation until their respective successors are duly
elected and qualified or their earlier death, resignation or removal in
accordance with the Certificate of Incorporation and By-laws of the Surviving
Corporation.
Section 2.7 Conversion of Securities. At the Effective Time, by
------------------------
virtue of the Merger and without any action on the part of the holders of any
securities of the Purchaser or the Company:
(a) Each Share that is owned by Alcoa, the Purchaser, any of their
respective Subsidiaries, the Company or any Subsidiary of the Company shall
automatically be cancelled and retired and shall cease to exist, and no
consideration shall be delivered in exchange therefor.
(b) Each issued and outstanding Share, other than Shares to be
cancelled in accordance with Section 2.7(a) and Dissenting Shares, shall
automati cally be converted into the right to receive the Offer Price in cash
(the "Merger Consideration"), payable, without interest, to the holder of such
Share, upon surrender, in the manner provided in Section 2.8, of the certificate
that formerly evidenced such Share. All such Shares, when so converted, shall
no longer be outstanding and shall automatically be cancelled and retired and
shall cease to exist, and each holder of a certificate representing any such
Shares shall cease to have any rights with respect thereto, except the right to
receive the Merger Consideration therefor upon the surrender of such certificate
in accordance with Section 2.8.
(c) Each issued and outstanding share of common stock, par value $.01
per share, of the Purchaser shall be converted into one validly issued, fully
paid and nonassessable share of common stock of the Surviving Corporation.
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Section 2.8 Exchange of Certificates.
------------------------
(a) Exchange Agent. Prior to the Effective Time, Alcoa shall
--------------
designate a bank or trust company reasonably acceptable to the Company to act as
agent for the holders of the Shares (other than Shares held by Alcoa and its
Subsidiaries, the Company and its Subsidiaries, and Dissenting Shares) in
connection with the Merger (the "Exchange Agent") to receive in trust, the
aggregate Merger Consideration to which holders of Shares shall become entitled
pursuant to Section 2.7(b). Alcoa shall deposit such aggregate Merger
Consideration with the Exchange Agent promptly following the Effective Time.
Such aggregate Merger Consideration shall be invested by the Exchange Agent as
directed by Alcoa or the Surviving Corporation.
(b) Exchange Procedures. Promptly after the Effective Time, Alcoa and
-------------------
the Surviving Corporation shall cause to be mailed to each holder of record, as
of the Effective Time, of a certificate or certificates, which immediately prior
to the Effective Time represented outstanding Shares (the "Certificates"), whose
Shares were converted pursuant to Section 2.7(b) into the right to receive the
Merger Consideration, a letter of transmittal (which shall specify that delivery
shall be effected, and risk of loss and title to the Certificates shall pass,
only upon proper delivery of the Certificates to the Exchange Agent and shall be
in such form and have such other provisions as Alcoa may reasonably specify) and
instructions for use in effecting the surrender of the Certificates in exchange
for the Merger Consideration. Upon surrender of a Certificate for cancellation
to the Exchange Agent or to such other agent or agents as may be appointed by
Alcoa, together with such letter of transmittal, properly completed and duly
executed in accordance with the instructions thereto, the holder of such
Certificate shall be entitled to receive in exchange therefor the Merger
Consideration for each Share formerly represented by such Certificate, and the
Certificate so surrendered shall forthwith be cancelled. No interest will be
paid or accrued on the cash payable upon the surrender of the Certificates. If
payment of the Merger Consideration is to be made to a Person other than the
Person in whose name the surrendered Certificate is registered, it shall be a
condition of payment that the Certificate so surrendered shall be properly
endorsed or shall be otherwise in proper form for transfer and that the Person
requesting such payment shall have paid all transfer and other Taxes required by
reason of the issuance to a Person other than the registered holder of the
Certificate surrendered or shall have established to the satisfaction of the
Surviving Corporation that such Tax either has been paid or is not applicable.
Until surrendered as contemplated by this Section 2.8, each Certificate shall be
deemed at any time after the Effective Time to represent only the right to
receive the Merger Consideration for each Share in cash as contemplated by this
Section 2.8.
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(c) Transfer Books; No Further Ownership Rights in the Shares. At
---------------------------------------------------------
the Effective Time, the stock transfer books of the Company shall be closed, and
thereafter there shall be no further registration of transfers of the Shares on
the records of the Company. From and after the Effective Time, the holders of
Certificates evidencing ownership of the Shares outstanding immediately prior to
the Effective Time shall cease to have any rights with respect to such Shares,
except as otherwise provided for herein or by applicable law. If, after the
Effective Time, Certificates are presented to the Surviving Corporation for any
reason, they shall be cancelled and exchanged as provided in this Article II.
(d) Termination of Fund; No Liability. At any time following the
---------------------------------
first anniversary of the Effective Time, the Surviving Corporation shall be
entitled to require the Exchange Agent to deliver to it any funds (including
any interest received with respect thereto) which had been made available to the
Exchange Agent, and holders shall be entitled to look to the Surviving
Corporation (subject to abandoned property, escheat or other similar laws) only
as general creditors thereof with respect to the Merger Consideration payable
upon due surrender of their Certificates without any interest thereon.
Notwithstanding the foregoing, neither the Surviving Corporation nor the
Exchange Agent shall be liable to any holder of a Certificate for Merger
Consider ation delivered to a public official pursuant to any applicable
abandoned property, escheat or similar law.
(e) Lost, Stolen or Destroyed Certificates. In the event any
--------------------------------------
Certificates for Shares shall have been lost, stolen or destroyed, upon the
making of an affidavit of that fact by the Person claiming such Certificate(s)
to be lost, stolen or destroyed and, if required by Alcoa, the posting by such
Person of a bond in such sum as Alcoa may reasonably direct as indemnity against
any claim that may be made against it or the Surviving Corporation with respect
to such Certificate(s), the Exchange Agent will issue the Merger Consideration
pursuant to Section 2.8(b) deliverable in respect of the Shares represented by
such lost, stolen or destroyed Certificates.
(f) Withholding Taxes. Alcoa and the Purchaser shall be entitled to
-----------------
deduct and withhold, or cause the Exchange Agent to deduct and withhold, from
the Offer Price or the Merger Consideration payable to a holder of Shares
pursuant to the Offer or the Merger any such amounts as are required under the
Internal Revenue Code of 1986, as amended (the "Code"), or any applicable
provision of state, local or foreign Tax law. To the extent that amounts are so
withheld by Alcoa or the Purchaser, such withheld amounts shall be treated for
all purposes of this Agreement as having
10
<PAGE>
been paid to the holder of the Shares in respect of which such deduction and
withholding was made by Alcoa or the Purchaser.
Section 2.9 Appraisal Rights. Notwithstanding anything in this
----------------
Agreement to the contrary, Shares (the "Dissenting Shares") that are issued and
outstanding immediately prior to the Effective Time and which are held by
stockholders who did not vote in favor of the Merger and who comply with all of
the relevant provisions of Section 262 of the DGCL (the "Dissenting
Stockholders") shall not be converted into or be exchangeable for the right to
receive the Merger Consideration, unless and until the holder or holders thereof
shall have failed to perfect or shall have effectively withdrawn or lost their
rights to appraisal under the DGCL. If any Dissenting Stockholder shall have
failed to perfect or shall have effectively withdrawn or lost such right, such
holder's Shares shall thereupon be converted into and become exchangeable for
the right to receive, as of the Effective Time, the Merger Consideration for
each Share without any interest thereon. The Company shall give Alcoa (i)
prompt notice of any written demands for appraisal of any Shares, attempted
withdrawals of such demands and any other instruments served pursuant to the
DGCL and received by the Company relating to stockholders' rights of appraisal,
and (ii) the opportunity to direct all negotiations and proceedings with respect
to demands for appraisal under the DGCL. Neither the Company nor the Surviving
Corporation shall, except with the prior written consent of Alcoa, voluntarily
make any payment with respect to, or settle or offer to settle, any such demand
for payment. If any Dissenting Stockholder shall fail to perfect or shall have
effectively withdrawn or lost the right to dissent, the Shares held by such
Dissenting Stockholder shall thereupon be treated as though such Shares had been
converted into the right to receive the Merger Consideration pursuant to Section
2.7(b).
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Except as set forth on the schedule delivered by the Company to Alcoa
prior to the execution and delivery of this Agreement (the "Company Disclosure
Schedule"), the Company represents and warrants to Alcoa and the Purchaser as
set forth below:
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Section 3.1 Organization, Qualification, Etc.
---------------------------------
(a) The Company is a corporation duly organized, validly existing and
in good standing under the laws of the State of Delaware, has the corporate
power and authority required for it to own its properties and assets and to
carry on its business as it is now being conducted. The Company is duly
qualified to do business and is in good standing in each jurisdiction in which
the ownership of its properties or the conduct of its business requires such
qualification, except for jurisdictions in which the failure to be so qualified
or in good standing would not, individually or in the aggregate, have a Material
Adverse Effect on the Company or substantially delay the Offer and the Merger or
otherwise prevent the Company from performing its obligations hereunder. As
used in this Agreement, any reference to any state of facts, event, change or
effect having a "Material Adverse Effect" on or with respect to the Company or
Alcoa, as the case may be, means such state of facts, event, change or effect
that has had, or would reasonably be expected to have, a material adverse effect
on the business, results of operations, assets or financial condition of the
Company and its Subsidiaries, taken as a whole, or Alcoa and its Subsidiaries,
taken as a whole, as the case may be. The Company has delivered or made
available to Alcoa copies of the certificate of incorporation and by-laws of the
Company. Such certificate of incorporation and by-laws are complete and correct
and in full force and effect, and the Company is not in violation of any of the
provisions of its certificate of incorporation or by-laws.
(b) Each of the Company's Significant Subsidiaries is a corporation or
other business entity duly organized, validly existing and in good standing
under the laws of its jurisdiction of incorporation or organization. Each of
the Company's Significant Subsidiaries (i) has the corporate or other
organizational power and authority required for it to own its properties and
assets and to carry on its business as it is now being conducted and (ii) is
duly qualified to do business and is in good standing in each jurisdiction in
which the ownership of its properties or the conduct of its business requires
such qualification, except for jurisdictions in which the failure to be so
qualified or in good standing would not, individually or in the aggregate, have
a Material Adverse Effect on the Company. All the outstanding shares of capital
stock of, or other ownership interests in, the Company's Subsidiaries are duly
authorized, validly issued, fully paid and non-assessable and, with respect to
such shares or ownership interests that are owned by the Company or its
Subsidiaries, are free and clear of all liens, claims, mortgages, encumbrances,
pledges, security interests, equities or charges of any kind (each, a "Lien").
All the outstanding shares of capital stock of, or other ownership interests in,
the Company's Subsidiaries are wholly owned by the Company, directly or
indirectly, except for the common stock, par value $0.01 per share
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<PAGE>
(the "Howmet Common Stock"), of Howmet International Inc. ("Howmet"), of which a
wholly owned Subsidiary of the Company owns as of the date hereof 84,650,000
shares. Other than the Subsidiaries listed in Section 3.1 of the Company
Disclosure Schedule, there are no Persons in which the Company owns, of record
or beneficially, any direct or indirect equity or similar interest or any right
(contingent or otherwise) to acquire the same.
Section 3.2 Capital Stock.
-------------
(a) The authorized capital stock of the Company consists of
200,000,000 shares of Company Common Stock and 25,000,000 shares of Preferred
Stock, par value $1.00 per share (the "Company Preferred Stock"). As of March
3, 2000, (i) 36,714,831 shares of Company Common Stock are issued and
outstanding; (ii) 1,560,220 shares of Company Common Stock are subject to
outstanding options issued under the Company's 1989 Stock Awards Plan; (iii)
1,514,143 shares of Company Common Stock are subject to outstanding options
issued under the Company's 1996 Stock Awards Plan, as amended; (iv) 4,356,725
shares of Company Common Stock are issued and held in the treasury of the
Company; and (v) no shares of Company Preferred Stock are issued, outstanding or
reserved for issuance, except for 600,000 shares of the Company Preferred Stock
which have been designated as "Series A Junior Participating Preferred Stock"
and reserved for issuance in connection with the Rights Agreement, dated May 22,
1997, between the Company and First Chicago Trust Company of New York (the
"Rights Agreement"). Since March 3, 2000 through the date of this Agreement,
(A) no options to purchase shares of Company Common Stock have been granted, (B)
no shares of Company Common Stock have been issued other than pursuant to the
exercise of options to purchase shares of Company Common Stock outstanding on
March 3, 2000 and (C) no shares of Company Preferred Stock have been issued.
Section 3.2(a) of the Company Disclosure Schedule sets forth a complete and
correct list, as of February 29, 2000, of all holders of options, directors'
restricted stock or other rights to purchase or receive capital stock of the
Company under a stock option or other stock based employee or non-employee
director benefit plan of the Company or any of its Subsidiaries, including such
person's name, the number of options (vested, unvested and total) or other
rights held by such person, the date of grant and the exercise price for each
such option or right.
(b) The authorized capital stock of Howmet consists of 400,000,000
shares of Howmet Common Stock, and 10,000,000 shares of preferred stock, par
value $.01 per share ("Howmet Preferred Stock"). As of March 3, 2000, (i)
100,033,307 shares of Howmet Common Stock are issued and outstanding; (ii)
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<PAGE>
4,301,250 shares of Howmet Common Stock are subject to outstanding options
issued under Howmet's 1997 Stock Awards Plan ("Howmet Options"); (iii) no shares
of Howmet Common Stock are issued and held in the treasury of Howmet; (iv) no
shares of Howmet Preferred Stock are issued and outstanding; and (v) no shares
of Howmet Preferred Stock are issued and outstanding or reserved for issuance.
Since March 3, 2000 through the date of this Agreement, (A) no Howmet Options
have been granted, (B) no shares of Howmet Common Stock have been issued other
than pursuant to the exercise of Howmet Options outstanding as of March 3, 2000
and (C) no shares of Howmet Preferred Stock have been issued. Section 3.2(b) of
the Company Disclosure Schedule sets forth a complete and correct list, as of
February 29, 2000 of all holders of options or other rights to purchase or
receive capital stock of Howmet under a stock option or other stock based
employee or non-employee director benefit plan of the Company, Howmet or any of
their Subsidiaries, including such person's name, the number of options (vested,
unvested and total) or other rights held by such person, the date of grant and
the exercise price for each such option or right.
(c) All the outstanding shares of Company Common Stock are duly
authorized, validly issued, fully paid and non-assessable. Except as set forth
in paragraph (a) or (b) above, except for the Company's obligations under the
Rights Agreement (including with respect to the preferred share purchase rights
issued or issuable thereunder (the "Rights"), and except for the transactions
contemplated by this Agreement, (1) there are no shares of capital stock of the
Company authorized, issued or outstanding, (2) there are no authorized or
outstanding options, warrants, calls, preemptive rights, subscriptions or other
rights, agreements, arrangements or commitments of any character obligating the
Company or any of its Subsidiaries to issue, transfer or sell or cause to be
issued, transferred or sold any shares of capital stock or other equity interest
in the Company or any of its Subsidiaries or securities convertible into or
exchangeable for such shares or equity interests, or obligating the Company or
any of its Subsidiaries to grant, extend or enter into any such option, warrant,
call, subscription or other right, agreement, arrangement or commitment, and (3)
there are no outstanding contractual obligations of the Company or any of its
Subsidiaries to repurchase, redeem or otherwise acquire any Shares or other
capital stock of the Company or any Subsidiary or to provide funds to make any
investment (in the form of a loan, capital contribution or otherwise) in any
Subsidiary (other than a Subsidiary that is wholly owned, directly or
indirectly, by the entity obligated to provide such funds) or other entity.
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Section 3.3 Corporate Authority Relative to this Agreement; No
--------------------------------------------------
Violation.
- ---------
(a) The Company has the corporate power and authority to enter into
this Agreement and to carry out its obligations hereunder. The execution and
delivery of this Agreement and the consummation of the transactions contemplated
hereby have been duly and validly authorized by the Board of Directors of the
Company and, except for obtaining the Company Stockholder Approval and the
filing of the Certificate of Merger or the Certificate of Ownership and Merger,
as applicable, no other corporate proceedings on the part of the Company are
necessary to authorize the consummation of the transactions contemplated hereby.
The Board of Directors of the Company approved for purposes of Section 203 of
the DGCL the entering into by Alcoa, the Purchaser and the Company of this
Agreement and the consummation of the transactions contemplated hereby and has
taken all appropriate action so that Section 203 of the DGCL, with respect to
the Company, will not be applicable to Alcoa and the Purchaser by virtue of such
actions. The Board of Directors of Howmet approved for purposes of Section 203
of the DGCL Alcoa and the Purchaser becoming "interested stockholders" pursuant
to Alcoa executing a letter agreement, dated March 13, 2000 with Howmet or their
entry into an agreement with the Company providing for a tender offer by the
Purchaser to acquire the outstanding Shares, to be followed by a merger in which
Alcoa would acquire the remaining Shares, and the consummation of such
transactions and the Board of Directors of Howmet has taken all appropriate
action so that Section 203 of the DGCL, with respect to Howmet, will not be
applicable to Alcoa and the Purchaser by virtue of such actions. This Agreement
has been duly and validly executed and delivered by the Company and, assuming
this Agreement constitutes a valid and binding agreement of Alcoa and the
Purchaser, constitutes a valid and binding agreement of the Company, enforceable
against the Company in accordance with its terms.
(b) Except for the filings, permits, authorizations, consents and
approvals set forth in Section 3.3(b)(i) of the Company Disclosure Schedule or
as may be required under the Securities Act of 1933, as amended (the "Securities
Act"), the Exchange Act, the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended (the "HSR Act"), state securities or blue sky laws, the rules
and regulations of the New York Stock Exchange or the Chicago Stock Exchange or
the anti-competition laws or regulations of the European Union or any foreign
jurisdiction in which the Company or Alcoa (directly or through Subsidiaries, in
each case ) has material assets or conducts material operations, and the filing
of the Certificate of Merger or Certificate of Ownership and Merger, as
applicable, under the DGCL, none of the execution, delivery
15
<PAGE>
or performance of this Agreement by the Company, the consummation by the Company
of the transactions contemplated hereby or compliance by the Company with any of
the provisions hereof will (i) conflict with or result in any breach of any
provision of the certificate of incorporation, by-laws or similar organizational
documents of the Company or any of its Subsidiaries, (ii) require any filing by
the Company or any of its Subsidiaries with, or permit, authorization, consent
or approval of, any federal, regional, state or local court, arbitrator,
tribunal, administrative agency or commission or other governmental or other
regulatory authority or agency, whether U.S. or foreign (a "Governmental
Entity"), (iii) result in a violation or breach of, or constitute (with or
without due notice or lapse of time or both) a default (or give rise to any
right of termination, amendment, cancellation or acceleration) under, any of the
terms, conditions or provisions of any note, bond, mortgage, indenture, lease,
license, contract, agreement or other instrument or obligation to which the
Company or any of its Subsidiaries is a party or by which any of them or any of
their properties or assets may be bound (the "Company Agreements"), or (iv)
violate any order, writ, injunction, decree, judgment, permit, license,
ordinance, law, statute, rule or regulation applicable to the Company, any of
its Subsidiaries or any of their properties or assets, excluding from the
foregoing clauses (ii), (iii) and (iv) such filings, permits, authorizations,
consents, approvals, violations, breaches or defaults which will not,
individually or in the aggregate, have a Material Adverse Effect on the Company
or prevent or substan tially delay the consummation of the transactions
contemplated hereby.
Section 3.4 Reports and Financial Statements. The Company has
--------------------------------
previously furnished or otherwise made available (by electronic filing or
otherwise) to Alcoa true and complete copies of:
(a) the Annual Reports on Form 10-K filed by the Company with the
SEC for the fiscal year ended June 30, 1998 and the fiscal period ended December
31, 1998, and the Annual Reports on Form 10-K filed by Howmet with the SEC for
each of the fiscal years ended December 31, 1997 and 1998;
(b) the Quarterly Reports on Form 10-Q filed by each of the
Company and Howmet with the SEC for the quarters ended March 31, 1999, June 30,
1999 and September 30, 1999;
(c) each definitive proxy statement filed by each of the Company
and Howmet with the SEC since December 31, 1997;
16
<PAGE>
(d) each final prospectus filed by each of the Company and Howmet
with the SEC since December 31, 1997, except any final prospectus on Form S-8;
and
(e) all Current Reports on Form 8-K filed by each of the Company
and Howmet with the SEC since January 1, 1998.
As of their respective dates, such reports, proxy statements and prospectuses
filed by the Company (collectively with, and giving effect to, any amendments,
supplements and exhibits thereto, the "Company SEC Reports") and filed by Howmet
(collectively with, and giving effect to, any amendments, supplements and
exhibits thereto, the "Howmet SEC Reports," and together with the Company SEC
Reports, the "Group SEC Reports") (i) complied as to form in all material
respects with the applicable requirements of the Securities Act, the Exchange
Act and the rules and regulations promulgated thereunder in effect as of the
date of filing, and (ii) did not contain any untrue statement of a material fact
or omit to state a material fact required to be stated therein or necessary to
make the statements therein, in the light of the circumstances under which they
were made, not misleading. Except to the extent that information contained in
any Group SEC Report was amended or was superseded by a later filed Group SEC
Report, none of the Group SEC Reports contains any untrue statement of a
material fact or omits to state any material fact required to be stated therein
or necessary in order to make the statements therein, in the light of the
circumstances under which they were made, not misleading. Except for (x) filing
requirements of Subsidiaries of the Company in connection with guarantees by
such Subsidiaries of indebtedness of the Company, (y) Cordant Technologies
Holding Company (with respect to the filing of Statements on Schedule 13D under
the Exchange Act) and (z) Howmet, none of the Company's Subsidiaries is required
to file any forms, reports or other documents with the SEC. The audited
consolidated financial statements and unaudited consolidated interim financial
statements included in the Group SEC Reports (including any related notes and
schedules) fairly present in all material respects the consolidated financial
position of each of the Company and Howmet, as the case may be, and its
respective consolidated Subsidiaries as of the dates thereof and the results of
operations and cash flows for the periods or as of the dates then ended
(subject, in the case of the unaudited interim financial statements, to normal
recurring year-end adjustments), and in each case were prepared in accordance
with generally accepted accounting principles in the United States ("GAAP")
consistently applied during the periods involved (except as otherwise disclosed
in the notes thereto). Since January 1, 1999, each of the Company and Howmet
has timely filed all reports, registration statements and other filings required
to be filed by it with the SEC under the rules and regulations of the SEC.The
Company
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<PAGE>
represents and warrants to Alcoa that, as of the respective dates
thereof, all reports of the type referred to in this Section 3.4 which the
Company files with the SEC on or after the date hereof, will not contain any
untrue statement of a material fact or omit to state a material fact required to
be stated therein or necessary to make the statements therein, in light of the
circumstances under which they were made, not misleading. The audited
consolidated financial statements and the unaudited consolidated interim
financial statements included in such reports (including any related notes and
schedules) will fairly present in all material respects the consolidated
financial position of the Company and its consolidated Subsidiaries as of the
dates thereof and the results of operations and cash flows or other information
included therein for the periods or as of the date then ended (subject, in the
case of the interim financial statements, to normal, recurring year-end
adjustments), and will be prepared in each case in accordance with GAAP
consistently applied during the periods involved (except as otherwise disclosed
in the notes thereto).
Section 3.5 No Undisclosed Liabilities. Neither the Company nor
--------------------------
any of its Subsidiaries has any liabilities or obligations of any nature
required to be set forth in a consolidated balance sheet of the Company and its
consolidated Subsidiaries under GAAP whether or not accrued, contingent or
otherwise, and there is no existing condition, situation or set of circumstances
which could be expected to result in such a liability or obligation, except
liabilities or obligations (a) reflected in the Group SEC Reports or (b) which,
individually or in the aggregate, would not have a Material Adverse Effect on
the Company.
Section 3.6 No Violation of Law. The businesses of the Company and
-------------------
its Subsidiaries are not being conducted in violation of any order, writ,
injunction, decree, judgment, permit, license, ordinance, law, statute, rule or
regulation of any Governmental Entity (provided that no representation or
warranty is made in this Section 3.6 with respect to Environmental Laws), except
(a) as described in the Group SEC Reports, and (b) for violations or possible
violations which would not, individually or in the aggregate, have a Material
Adverse Effect on the Company.
Section 3.7 Environmental Matters.
---------------------
(a) Each of the Company and its Subsidiaries has obtained all
licenses, permits, authorizations, approvals and consents from Governmental
Entities which are required under any applicable Environmental Law and necessary
for it to carry on its business or operations as now conducted ("Environmental
Permits"), except for such failures to have Environmental Permits which,
individually or in the aggregate,
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would not have a Material Adverse Effect on the Company. Each of such Environmen
tal Permits is in full force and effect, and each of the Company and its
Subsidiaries is in compliance with the terms and conditions of all such
Environmental Permits and with all applicable Environmental Laws, except for
such failures to be in full force and effect or in compliance which,
individually or in the aggregate, would not have a Material Adverse Effect on
the Company.
(b) There are no Environmental Claims pending or, to the best
knowledge of the Company, threatened against the Company or any of its
Subsidiaries, or, to the best knowledge of the Company, for which the Company or
any of its Subsidiaries is liable, that, individually or in the aggregate, would
have a Material Adverse Effect on the Company.
(c) To the best knowledge of the Company, there are no past or present
actions, activities, circumstances, conditions, events or incidents, including,
without limitation, the release, threatened release or presence of any Hazardous
Material, that would form the basis of any Environmental Claim against the
Company or any of its Subsidiaries, or for which the Company or any of its
Subsidiaries is liable, except for such Environmental Claims which, individually
or in the aggregate, would not have a Material Adverse Effect on the Company.
(d) To the best knowledge of the Company, no site or facility now or
previously owned, operated or leased by the Company or any of its Subsidiaries
is listed or proposed for listing on the National Priorities List promulgated
pursuant to the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended, and the rules and regulations thereunder ("CERCLA").
(e) No Liens have arisen under or pursuant to any Environ mental Law
on any site or facility owned, operated or leased by the Company or any of its
Subsidiaries, except for such Liens which would not, individually or in the
aggregate, have a Material Adverse Effect on the Company, and no action of any
Governmental Entity has been taken or, to the best knowledge of the Company, is
in process which could subject any of such properties to such Liens, except for
any such action which, individually or in the aggregate, would not have a
Material Adverse Effect on the Company.
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(f) As used in this Agreement:
(i) "Environmental Claim" means any claim, action, lawsuit
or proceeding by any Person which seeks to impose liability (including,
without limitation, liability for investigatory costs, cleanup costs,
governmental response costs, natural resources, damages, property damages,
personal injuries or penalties) arising out of, based on or resulting from
(A) the presence, or release or threatened release, of any Hazardous
Materials at any location, whether or not owned or operated by the Company
or any of its Subsidiaries, or (B) circumstances which would give rise to
any violation, or alleged violation, of any Environmental Law.
(ii) "Environmental Law" means any law or order of any
Governmental Entity relating to (A) the generation, treatment, storage,
disposal, use, handling, manufacturing, transportation or shipment of
Hazardous Materials or (B) the environment or to emissions, discharges,
releases or threatened releases of Hazardous Material into the environment.
(ii) "Hazardous Materials" means (A) any petroleum or
petroleum products, radioactive materials or friable asbestos; (B) any
chemicals or other materials or substances which are now defined as or
included in the definition of "hazardous substances," "hazardous wastes,"
"hazardous materials," "extremely hazardous wastes," "restricted hazardous
wastes," "toxic substances," "toxic pollutants," "pollutants,"
contaminants," "infectious wastes," "hazardous chemicals" or "hazardous
pollutants," under any Environmental Law; and (C) pesticides.
Section 3.8 Employee Benefit Plans; ERISA.
-----------------------------
(a) Section 3.8(a) of the Company Disclosure Schedule contains a true
and complete list of each material deferred compensation, incentive compensation
or equity compensation plan; "welfare" plan, fund or program (within the meaning
of section 3(1) of the Employee Retirement Income Security Act of 1974, as
amended ("ERISA")); "pension" plan, fund or program (within the meaning of
section 3(2) of ERISA); each material employment, consulting, termination or
severance agreement; and each other material employee benefit plan, fund,
program, agreement or arrangement, in each case, that is sponsored, maintained
or contributed to or required to be contributed to by the Company or by any
trade or business, whether or not incorporated (an "ERISA Affiliate"), that
together with the Company would be deemed
20
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a "single employer" within the meaning of section 4001(b) of ERISA, or to which
the Company or an ERISA Affiliate is party, for the benefit of any employee or
former employee of the Company or any Subsidiary (the "Company Plans");
provided, that Section 3.8(a) of the Company Disclosure Schedule does not set
forth a complete list of Company Plans that are maintained outside the United
States primarily for the benefit of persons who are not citizens or residents of
the United States ("Foreign Plans"). The Company shall deliver a true and
complete list of Foreign Plans to Purchaser as soon as practicable after the
date hereof. The Company and its Subsidiaries do not have any material
liabilities or obligations with respect to Foreign Plans (whether or not
accrued, contingent or otherwise) which are not reflected in the Group SEC
Reports to the extent required to be so reflected.
(b) With respect to each Company Plan, the Company shall, as soon as
practicable after the date hereof, deliver or make available to Alcoa true and
complete copies of the Company Plans and any amendments thereto, any related
trust or other funding vehicle, any reports or summaries required under ERISA or
the Code and the most recent determination letter received from the Internal
Revenue Service (the "IRS") with respect to each Company Plan intended to
qualify under Section 401 of the Code.
(c) No liability under Title IV or section 302 of ERISA has been
incurred by the Company or any ERISA Affiliate that has not been satisfied in
full, and no condition exists that presents a material risk to the Company or
any ERISA Affiliate of incurring any such liability, other than liability for
premiums due the Pension Benefit Guaranty Corporation (which premiums have been
paid when due), except as would not have a Material Adverse Effect on the
Company.
(d) No Company Plan that is subject to Title IV (a "Company Title IV
Plan") is a "multiemployer pension plan," as defined in section 3(37) of ERISA,
nor is any Company Title IV Plan a plan described in section 4063(a) of ERISA.
(e) Each Company Plan has been operated and administered in accordance
with its terms and applicable law, including but not limited to ERISA and the
Code, except as would not have a Material Adverse Effect on the Company, and
each Company Plan intended to be "qualified" within the meaning of section
401(a) of the Code is so qualified and the trusts maintained thereunder are
exempt from taxation under section 501(a) of the Code, except for failures to so
qualify or be exempt that would reasonably be expected to be curable without a
Material Adverse Effect on the Company.
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(f) No Company Plan provides medical, surgical, hospitaliza tion,
death or similar benefits (whether or not insured) for employees or former
employees of the Company or any Subsidiary for periods extending beyond their
retirement or other termination of service, other than (i) coverage mandated by
applicable law, (ii) death benefits under any "pension plan," or (iii) benefits
the full cost of which is borne by the current or former employee (or his
beneficiary).
(g) Section 3.8(g)(i) of the Company Disclosure Schedule sets forth
each Company Plan under which payments may be made that could constitute "excess
parachute payments" within the meaning of Section 280G of the Code. The
aggregate amount of such excess parachute payments (exclusive of "gross-up
payments" for excise tax) shall not exceed the amount set forth in Section
3.8(g)(ii) of the Company Disclosure Schedule.
(h) Section 3.8(h) of the Company Disclosure Schedule sets forth each
Company Plan under which, as a result of the consummation of the Offer or the
Merger, either alone or in combination with another event, (A) any current or
former employee or officer of the Company or any ERISA Affiliate may become
entitled to severance pay or any other payment, except as expressly provided in
this Agreement, or (B) compensation due any such employee or officer may become
accelerated the time of payment or vested, or increased.
(i) There are no pending or, to the best knowledge of the Company,
threatened claims by or on behalf of any Company Plan, by any employee or
beneficiary covered under any such Company Plan, or otherwise involving any such
Company Plan (other than routine claims for benefits), except as would not have
a Material Adverse Effect on the Company.
(j) There are no pending or scheduled audits of any Company Plan by
any Governmental Entity or any pending nor, to the best knowledge of the
Company, threatened claims or penalties resulting from any such audit, except as
would not have a Material Adverse Effect on the Company.
Section 3.9 Absence of Certain Changes or Events. Except as
------------------------------------
disclosed in the Group SEC Reports, since December 31, 1998 (a) the businesses
of the Company and its Subsidiaries have been conducted in all material respects
in the ordinary course, and (b) there has not been any event, occurrence,
development or state
22
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of circumstances or facts that has had, or would have,
individually or in the aggregate, a Material Adverse Effect on the Company.
Section 3.10 Litigation. Except as disclosed in the Group SEC
----------
Reports, there are no claims, actions, suits, proceedings, arbitrations or
investigations pending (or, to the best knowledge of the Company, threatened)
against or affecting the Company or its Subsidiaries or any of their respective
properties or assets at law or in equity, by or before any Governmental Entity
which, individually or in the aggregate, will have a Material Adverse Effect on
the Company or would prevent or substantially delay the Offer or the Merger.
Section 3.11 Schedule 14D-9; Offer Documents; and Proxy Statement.
----------------------------------------------------
Neither the Schedule 14D-9 nor any information supplied by the Company for
inclusion in the Offer Documents will, at the respective times the Schedule 14D-
9, the Offer Documents or any amendments or supplements thereto are filed with
the SEC or are first published, sent or given to stockholders of the Company, as
the case may be, contain any untrue statement of a material fact or omit to
state any material fact required to be stated therein or necessary in order to
make the statements made therein, in the light of the circumstances under which
they are made, not misleading. The Proxy Statement will not, on the date the
Proxy Statement (or any amendment or supplement thereto) is first mailed to
stockholders of the Company, contain any untrue statement of a material fact, or
omit to state any material fact required to be stated therein or necessary in
order to make the statements made therein, in the light of the circumstances
under which they are made, not misleading or will, at the time of the Special
Meeting, omit to state any material fact necessary to correct any statement in
any earlier communication with respect to the solicitation of proxies for the
Special Meeting which shall have become false or misleading in any material
respect. The Schedule 14D-9 and the Proxy Statement will, when filed by the
Company with the SEC, comply as to form in all material respects with the
applicable provisions of the Exchange Act and the rules and regulations
thereunder. Notwithstanding the foregoing, the Company makes no representation
or warranty with respect to information supplied by or on behalf of Alcoa or the
Purchaser which is contained in any of the foregoing documents.
Section 3.12 Intellectual Property.
---------------------
(a) The Company and its Subsidiaries own or have valid rights to use
all items of Intellectual Property utilized in the conduct of the business of
the Company and its Subsidiaries as presently conducted free and clear of all
Liens with
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such exceptions as would not have, individually or in the aggregate,
a Material Adverse Effect on the Company.
(b) Except as would not individually or in the aggregate have a
Material Adverse Effect on the Company, (i) neither the Company nor any
Subsidiary of the Company is in default (or with the giving of notice or lapse
of time or both, would be in default) under any license or other grant to use
such Intellectual Property, (ii) such Intellectual Property is not being
infringed by any third party, (iii) neither the Company nor any Subsidiary is
infringing any Intellectual Property of any third party, and (iv) in the last
three years neither the Company nor any Subsidiary has received any written
claim or notice of infringement from any third party.
(c) As used in this Agreement, "Intellectual Property" means all of
the following: (i) U.S. and foreign registered and unregistered trademarks and
pending trademark applications, trade dress, service marks, logos, trade names,
brand names, corporate names, assumed names and business names and all
registrations and applications to register the same (the "Trademarks"), (ii)
issued U.S. and foreign patents and pending patent applications, invention
disclosures, and any and all divisions, continuations, continuations-in-part,
reissues, continuing patent applications, reexaminations, and extensions
thereof, any counterparts claiming priority therefrom, utility models, patents
of importation/confirmation, certificates of invention, certificates of
registration and like statutory rights (the "Patents"), (iii) U.S. and foreign
copyrights (including, but not limited to, those in computer software and
databases), rights of publicity, and all registrations and applications to
register the same (the "Copyrights"), (iv) all categories of trade secrets as
defined in the Uniform Trade Secrets Act and under corresponding foreign
statutory and common law, including, but not limited to, business, technical and
know-how information, (v) all licenses and agreements pursuant to which the
Company or any Subsidiary has acquired rights in or to any Trademarks, Patents,
trade secrets, technology, know-how, Computer Software, rights of publicity or
Copyrights, or licenses and agreements pursuant to which the Company has
licensed or transferred the right to use any of the foregoing, and (vi) all
computer software, data files, source and object codes, user interfaces, manuals
and other specifications and documentation and all know-how relating thereto
(collectively, "Computer Software").
Section 3.13 Tax Matters.
-----------
(a) All federal, state, local and foreign Tax Returns required to be
filed by or on behalf of the Company, each of its Subsidiaries and each
affiliated, combined, consolidated or unitary group of which the Company or any
of its
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Subsidiaries is a member (a "Company Affiliated Group") have been timely
filed or requests for extensions have been timely filed and any such extension
has been granted and has not expired, and all such filed Tax Returns are
complete and accurate except to the extent any failure to file or any
inaccuracies in filed Tax Returns would not, individually or in the aggregate,
have a Material Adverse Effect on the Company. All Taxes due and owing by the
Company, any Subsidiary of the Company or any Company Affiliated Group have been
paid, or adequately reserved for, except to the extent any failure to pay or
reserve for would not, individually or in the aggregate, have a Material Adverse
Effect on the Company. There is no audit, examination, deficiency, refund
litigation, proposed adjustment or matter in controversy with respect to any
Taxes due and owing by the Company, any Subsidiary of the Company or any Company
Affiliated Group which if determined adversely would, individually or in the
aggregate, have a Material Adverse Effect on the Company. All assessments for
Taxes due and owing by the Company, any Subsidiary of the Company or any Company
Affiliated Group with respect to completed and settled examinations or concluded
litigation have been paid, except to the extent any failures to pay would not
individually or in the aggregate have a Material Adverse Effect on the Company.
Section 3.13(a) of the Company Disclosure Schedule sets forth (i) the taxable
years of the Company for which the statutes of limitations with respect to U.S.
federal income Taxes have not expired, and (ii) with respect to federal income
Taxes for such years, those years for which examinations have been completed,
those years for which examinations are presently being conducted, and those
years for which examinations have not yet been initiated. Neither the Company
nor any of its Subsidiaries has any liability under Treasury Regulation Section
1.1502-6 for U.S. federal income Taxes of any Person other than the Company and
its Subsidiar ies except to the extent of any liabilities that would not,
individually or in the aggregate, have a Material Adverse Effect on the Company.
The Company and each of its Subsidiaries have complied in all material respects
with all rules and regulations relating to the withholding of Taxes, except to
the extent any such failure to comply would not, individually or in the
aggregate, have a Material Adverse Effect on the Company.
(b) Neither the Company nor any Subsidiary of the Company has (i)
entered into a closing agreement or other similar agreement with a taxing
authority relating to Taxes of the Company or any Subsidiary of the Company with
respect to a taxable period for which the statute of limitations is still open,
or (ii) with respect to U.S. federal income Taxes, granted any waiver of any
statute of limitations with respect to, or any extension of a period for the
assessment of, any income Tax, in either case, that is still outstanding. There
are no Liens relating to material Taxes upon the assets of the Company or any
Subsidiary of the Company other than Liens relating to Taxes not yet due or
Liens for which adequate reserves have been established.
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Neither the Company nor any Subsidiary of the Company is a party to or is bound
by any Tax sharing agreement, Tax indemnity obligation or similar agreement or
practice in respect of Taxes (other than with respect to agreements solely
between or among members of the consolidated group of which the Company is the
common parent). No consent under Section 341(f) of the Code has been filed with
respect to the Company or any Subsidiary of the Company.
(c) For purposes of this Agreement: (i) "Taxes" means any and all
federal, state, local, foreign or other taxes of any kind (together with any and
all interest, penalties, additions to tax and additional amounts imposed with
respect thereto) imposed by any taxing authority, including, without limitation,
taxes or other charges on or with respect to income, franchises, windfall or
other profits, gross receipts, property, sales, use, capital stock, payroll,
employment, social security, workers' compensation, unemployment compensation or
net worth, and taxes or other charges in the nature of excise, withholding, ad
valorem or value added, and (ii) "Tax Return" means any return, report or
similar statement (including the attached schedules) required to be filed with
respect to any Tax, including, without limitation, any information return, claim
for refund, amended return or declaration of estimated Tax.
Section 3.14 Opinion of Financial Advisor. The Board of Directors
----------------------------
of the Company has received the opinion of Morgan Stanley & Co. Incorporated,
dated the date of this Agreement, substantially to the effect that, the
consideration to be received by the holders of Shares pursuant to this Agreement
is fair to such stockholders from a financial point of view.
Section 3.15 Required Vote of the Company Stockholders. The
-----------------------------------------
affirmative vote of the holders of a majority of the outstanding shares of
Company Common Stock (the "Company Stockholder Approval") is the only vote of
the holders of any class or series of the Company's capital stock which is
necessary to approve and adopt this Agreement.
Section 3.16 Employment Matters. Neither the Company nor any of its
------------------
Subsidiaries has experienced any work stoppages, strikes, collective labor
grievances, other collective bargaining disputes or claims of unfair labor
practices in the last year which would, individually or in the aggregate, have a
Material Adverse Effect on the Company. There is no organizational effort
presently being made or, to the best knowledge of the Company, threatened by or
on behalf of any labor union with respect to employees of the Company or any of
its Subsidiaries, except as would not have a Material Adverse Effect on the
Company.
26
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Section 3.17 Rights Plan. The Board of Directors of the Company has
-----------
amended the Rights Agreement to provide that (i) so long as this Agreement has
not been terminated pursuant to Section 7.1, a Distribution Date (as such term
is defined in the Rights Agreement) shall not occur or be deemed to occur, and
neither Alcoa nor the Purchaser shall become an Acquiring Person (as such term
is defined in the Rights Agreement), as a result of the execution, delivery or
performance of this Agreement, the announcement, making or consummation of the
Offer, the acquisition of Shares pursuant to the Offer or the Merger, the
consummation of the Merger or any other transaction contemplated by this
Agreement and (ii) the Rights shall expire immediately prior to the consummation
of the Offer.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
OF ALCOA AND THE PURCHASER
Except as set forth on the schedule delivered by Alcoa to the Company
prior to the execution of this Agreement (the "Alcoa Disclosure Schedule," and
together with the Company Disclosure Schedule, the "Disclosure Schedule"), Alcoa
and the Purchaser jointly and severally represent and warrant to the Company as
set forth below:
Section 4.1 Organization, Qualification, Etc. Each of Alcoa and
---------------------------------
the Purchaser is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation, has the
corporate power and authority and all governmental approvals required for it to
own its properties and assets and to carry on its business as it is now being
conducted or presently proposed to be conducted. Each of Alcoa and the Purchaser
is duly qualified to do business and is in good standing in each jurisdiction in
which the ownership of its properties or the conduct of its business requires
such qualification, except for jurisdictions in which the failure to be so
qualified and in good standing would not, individually or in the aggregate, have
a Material Adverse Effect on Alcoa or delay consummation of the transactions
contemplated by this Agreement or otherwise prevent Alcoa or the Purchaser from
performing its obligations hereunder. The Purchaser is a wholly owned
Subsidiary of Alcoa.
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Section 4.2 Corporate Authority Relative to this Agreement; No
--------------------------------------------------
Violation.
- ---------
(a) Each of Alcoa and the Purchaser has the corporate power and
authority to enter into this Agreement and to carry out its obligations
hereunder. The execution and delivery of this Agreement and the consummation of
the transactions contemplated hereby have been duly and validly authorized by
the Board of Directors of each of Alcoa and the Purchaser. Alcoa, as the sole
stockholder of the Purchaser, has duly and validly approved and adopted this
Agreement. Other than the filing of the Certificate of Merger no other
corporate proceedings on the part of Alcoa or the Purchaser (including their
respective stockholders) are necessary to authorize the consummation of the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by Alcoa and the Purchaser and, assuming this Agreement
constitutes a valid and binding agreement of the Company, constitutes a valid
and binding agreement of each of Alcoa and the Purchaser, enforceable against
each of Alcoa and the Purchaser in accordance with its terms.
(b) Except for the filings, permits, authorizations, consents and
approvals as may be required under the Exchange Act, the HSR Act, or the anti-
competition laws or regulations of the European Union or any foreign
jurisdiction in which the Company or Alcoa (directly or through Subsidiaries, in
each case) has material assets or conducts material operations and the filing of
the merger certificate under the DGCL, none of the execution, delivery or
performance of this Agreement by Alcoa or the Purchaser, the consummation by
Alcoa or the Purchaser of the transactions contemplated hereby or compliance by
Alcoa or the Purchaser with any of the provisions hereof will (i) conflict with
or result in any breach of any provision of the articles of incorporation or by-
laws of Alcoa or the certificate of incorporation, by-laws or similar
organizational documents of any of its Subsidiaries, including the Purchaser,
(ii) require any filing with, or permit, authorization, consent or approval of,
any Governmental Entity, (iii) result in a violation or breach of, or constitute
(with or without due notice or lapse of time or both) a default (or give rise to
any right of termination, amendment, cancellation or acceleration) under, any of
the terms, conditions or provisions of any note, bond, mortgage, indenture,
lease, license, contract, agreement or other instrument or obligation to which
Alcoa or any of its Subsidiaries is a party or by which any of them or any of
their respective properties or assets may be bound (the "Alcoa and Purchaser
Agreements"), or (iv) violate any order, writ, injunction, decree, judgment,
permit, license, ordinance, law, statute, rule or regulation applicable to
Alcoa, any of its Subsidiaries or any of their respective properties or assets,
excluding from the foregoing clauses (ii), (iii) and (iv) such violations,
breaches or
28
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defaults which will not, individually or in the aggregate, have a Material
Adverse Effect on Alcoa or prevent or substantially delay the consummation of
the transactions contemplated hereby.
Section 4.3 Offer Documents; Proxy Statement; Schedule 14D-9.
------------------------------------------------
Neither the Offer Documents nor any information supplied by Alcoa or the
Purchaser for inclusion in the Schedule 14D-9 will, at the time the Offer
Documents, the Schedule 14D-9, or any amendments or supplements thereto, are
filed with the SEC or are first published, sent or given to stockholders of the
Company, as the case may be, contain any untrue statement of a material fact or
omit to state any material fact required to be stated therein or necessary in
order to make the statements made therein, in the light of the circumstances
under which they are made, not misleading. The information supplied by Alcoa
for inclusion in the Proxy Statement will not, on the date the Proxy Statement
(or any amendment or supplement thereto) is first mailed to stockholders of the
Company, contain any untrue statement of a material fact or omit to state any
material fact required to be stated therein or necessary in order to make the
statements therein, in the light of the circumstances under which they are made,
not misleading, or shall, at the time of the Special Meeting, omit to state any
material fact necessary to correct any statement in any earlier communication
with respect to the solicitation of proxies for the Special Meeting which shall
have become false or misleading. Notwithstanding the foregoing, Alcoa and the
Purchaser make no representation or warranty with respect to any information
supplied by or on behalf of the Company which is contained in any of the Offer
Documents, the Proxy Statement or any amendment or supplement thereto. The Offer
Documents shall comply as to form in all material respects with the requirements
of the Exchange Act and the rules and regulations thereunder.
Section 4.4 Financing. At or prior to the dates that the Purchaser
---------
becomes obligated to accept for payment and pay for Shares pursuant to the
Offer, and at the Effective Time, Alcoa and the Purchaser will have sufficient
cash resources available to pay for the Shares that the Purchaser becomes so
obligated to accept for payment and pay for pursuant to the Offer and to pay the
aggregate Merger Consider ation pursuant to the Merger.
Section 4.5 Opinion of Financial Advisor. The Board of Directors
----------------------------
of Alcoa has received the opinion of Salomon Smith Barney Inc., dated the date
of this Agreement, substantially to the effect that the consideration to be
offered by Alcoa in the Offer and the Merger, taken together, is fair to Alcoa
from a financial point of view.
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Section 4.6 Ownership of Capital Stock. Immediately prior to the
--------------------------
execution and delivery of this Agreement, neither Alcoa nor any of its
Subsidiaries beneficially owned any Shares or any shares of Howmet Common Stock.
ARTICLE V
COVENANTS AND AGREEMENTS
Section 5.1 Conduct of Business Prior to the Effective Time. (a)
-----------------------------------------------
The Company agrees that, from and after the date hereof and prior to the
Effective Time or the date, if any, on which this Agreement is earlier
terminated pursuant to Section 7.1 (the "Termination Date"), and except as may
be agreed in writing by Alcoa, which agreement shall not be unreasonably
withheld or delayed, as may be expressly permitted pursuant to this Agreement or
as set forth in Section 5.1 of the Company Disclosure Schedule, the Company:
(i) shall, and shall cause each of its Subsidiaries to,
conduct its operations in all material respects according to their ordinary
course of business in substantially the same manner as heretofore
conducted;
(ii) shall use its reasonable best efforts, and cause each
of its Subsidiaries to use its reasonable best efforts, to preserve intact
its business organization and goodwill, keep available the services of its
current officers and other key employees and preserve its current
relationships with those Persons having significant business dealings with
the Company and its Subsidiaries;
(ii) shall notify Alcoa of any emergency or other
substantial change in the normal course of its or its Subsidiaries'
respective businesses or in the operation of its or its Subsidiaries'
respective properties and of any complaints of or hearings (or written
communications indicating that the same are threatened) of which the
Company has knowledge before any Governmental Entity if such emergency,
change, complaint, investigation or hearing would have a Material Adverse
Effect on the Company ;
(iv) shall not, and shall not permit any of its
Subsidiaries that is not incorporated or organized in the United States or
not wholly owned to, repatriate funds, authorize or pay any dividends on or
make any distribution with respect to its outstanding shares of capital
stock (other than (A) regularly
30
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quarterly cash dividends by the Company in an amount not to exceed $0.10
per Share per quarter declared and paid in accordance with past practice,
including establishment of record and payment dates and (B) dividends or
distributions by wholly owned Subsidiaries of the Company;
(v) shall not, and shall not permit any of its Subsidiaries
to establish, enter into or amend any severance plan, agreement or
arrangement or any Company Plan or materially increase the compensation
payable or to become payable or the benefits provided to its officers or
employees, except as may be required by applicable law or a contract in
existence on the date hereof, and except for increases for nonofficer
employees in the normal course of business consistent with past practice;
(vi) shall not, and shall not permit any of its Subsidiaries
to, authorize or announce an intention to authorize, or enter into an
agreement with respect to, any merger, consolidation or business
combination (other than the Merger), any acquisition of any assets or
securities, or any disposition of any assets or securities, except in an
amount that is not material to the Company and its Subsidiaries taken as a
whole;
(vii) shall not, and shall not permit any of its
Subsidiaries to, propose or adopt any amendments to its certificate of
incorporation or by-laws (or other similar organizational documents);
(viii) shall not, and shall not permit any of its Subsidiar
ies to, issue or authorize the issuance of, or agree to issue or sell any
shares of capital stock of any class (whether through the issuance or
granting of options, warrants, commitments, convertible securities,
subscriptions, rights to purchase or otherwise), except for (1) the
issuance of Company Common Stock and associated Rights pursuant to options
and grants outstanding as of the date of this Agreement which were issued
or made, as the case may be, pursuant to the Company's 1989 Stock Awards
Plan, 1996 Stock Awards Plan and Key Executive Long-Term Incentive Plan and
each of which is set forth in Section 3.2(a) of the Company Disclosure
Schedule, (2) the issuance of Howmet Common Stock pursuant to options and
grants outstanding as of the date of this Agreement, which were issued or
made, as the case may be, pursuant to Howmet's 1997 Stock Awards Plan, and
each of which is set forth in Section 3.2(b) of the Company Disclosure
Schedule; or take any action to cause to be exercisable any otherwise
unexercisable option under any existing stock option
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plan and (3) the annual issuance to each non-employee director of the
Company of shares of Company Common Stock having a value of $20,000;
provided, that such issuance is made at such time as is consistent with
past practice;
(ix) shall not, and shall not permit any of its
Subsidiaries to, reclassify, combine, split, purchase or redeem any shares
of its capital stock or purchase or redeem any rights, warrants or options
to acquire any such shares (other than as contemplated by the Company
Plans);
(x) shall not, and shall not permit any of its
Subsidiaries to, (A) incur, assume or prepay any indebtedness or any other
material liabilities for borrowed money or issue any debt securities other
than (i) incurrences and repayments of indebtedness under the Company's or
its Subsidiaries' credit facilities in existence on the date of this
Agreement in the ordinary course of business consistent with past practice
and (ii) in an amount not to exceed $40 million in the aggregate or (B)
assume, guarantee, endorse or otherwise become liable or responsible
(whether directly, contingently or otherwise) for the obligations of any
other Person (other than wholly owned Subsidiaries), except for guarantees
by Subsidiaries of the Company of indebtedness permitted under the
preceding clause (A) ;
(xi) shall not, and shall not permit any of its
Subsidiaries to (or consent to any proposal by any Person in which the
Company has an investment to), make or forgive any loans, advances or
capital contributions to, or investments in, any other Person other than
the Company or any wholly-owned Subsidiary of the Company (including any
intercompany loans, advances or capital contributions to, or investments
in, any affiliate) other than advances to employees in the ordinary course
of business in accordance with the Company's or its Subsidiaries'
established policies;
(xii) shall not, and shall not permit any of its
Subsidiaries to, (A) enter into any material lease or license or otherwise
subject to any material Lien any of its properties or assets (including
securitizations), other than in the ordinary course of business consistent
with past practice; (B) modify or amend in any material respect, or
terminate, any of its material contracts (except (x) with respect to
"classified" contracts or (y) in the ordinary course of business); (C)
waive, release or assign any rights that are material to the Company and
its Subsidiaries taken as a whole; or (D) permit any insurance policy
naming it as a beneficiary or a loss payable payee to lapse, be cancelled
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<PAGE>
or expire unless a new policy with substantially identical coverage is in
effect as of the date of lapse, cancellation or expiration;
(xiii) shall not, and shall not permit any of its Subsidiar
ies to change any of the financial accounting methods used by it unless
required by generally accepted accounting principles of the applicable
country or change in applicable law;
(xiv) shall not, and shall not permit any of its Subsidiar
ies to, file with, or submit to, any Governmental Entity (including the
SEC) any registration statement, prospectus or other similar document, or
any amendment or supplement thereto, relating to the issuance of any
securities of the Company or any Subsidiary of the Company, other than a
registration statement of the Company on Form S-8 (including any final
prospectus thereon) or any amendment or supplement thereto, filed with the
SEC in connection with the Company Stock Plans, in each case, in the
ordinary course of business consistent with past practice;
(xv) shall not, and shall not permit any of its
Subsidiaries to, agree, in writing or otherwise, to take any of the
foregoing actions or take any action which would (y) make any
representation or warranty in Article III hereof untrue or incorrect in any
material respect, or (z) result in any of the conditions to the Offer set
forth in Annex A hereto or any of the conditions to the Merger set forth in
Article VI hereof not being satisfied;
(b) Alcoa agrees that, from and after the date hereof and prior to the
earlier of the Effective Time and the Termination Date, and except as may be
agreed in writing by the Company or as may be expressly permitted pursuant to
this Agreement, Alcoa shall not, and shall not permit any of its Subsidiaries to
(i) agree, in writing or otherwise, to take any action which would result in any
of the conditions to the Offer set forth in Annex A hereto or any of the
conditions to the Merger set forth in Article VI hereof not being satisfied or
(ii) delay the consummation of the Offer, including by application of Rule 14e-5
under the Exchange Act.
Section 5.2 Access; Confidentiality.
-----------------------
(a) Except for competitively sensitive information or government
"classified" information or as limited by applicable law (including, without
limitation, antitrust laws) or the terms of any confidentiality agreement or
provision in
33
<PAGE>
effect on the date of this Agreement, the Company shall (and shall
cause each of its Subsidiaries to) afford to the officers, employees,
accountants, counsel and other authorized representatives of Alcoa reasonable
access during normal business hours upon reasonable notice, throughout the
period prior to the earlier of the Effective Time or the Termination Date, to
its properties, offices, facilities, employees, contracts, commitments, books
and records (including but not limited to Tax Returns and supporting work
papers) and any report, schedule or other document filed or received by it
pursuant to the requirements of federal or state securities laws and shall (and
shall cause each of its Subsidiaries to) furnish to Alcoa such additional
financial and operating data and Tax and other information as to its and its
Subsidiaries' respective businesses and properties as Alcoa may from time to
time reasonably request. Alcoa and the Purchaser will use their best efforts to
minimize any disruption to the businesses of the Company and its Subsidiaries
which may result from the requests for data and information hereunder. No
investigation pursuant to this Section 5.2(a) shall affect any representation or
warranty in this Agreement of any party hereto or any condition to the
obligations of the parties hereto.
(b) Alcoa will hold any information provided under this Section 5.2
that is non-public in confidence to the extent required by, and in accordance
with, the provisions of the letter dated December 2, 1999, between Alcoa and the
Company (the "Confidentiality Agreement").
Section 5.3 Special Meeting; Proxy Statement.
--------------------------------
(a) Following the purchase of Shares pursuant to the Offer, if
required by applicable law in order to consummate the Merger, the Company,
acting through its Board of Directors, shall, in accordance with applicable law:
(i) duly call, give notice of, convene and hold a special
meeting of its stockholders (the "Special Meeting") for the purposes of
considering and taking action upon the approval and adoption of this Agree
ment; and
(ii) prepare and file with the SEC a preliminary proxy or
information statement relating to the Merger and this Agreement and obtain
and furnish the information required to be included by the SEC in the Proxy
Statement and, after consultation with Alcoa, respond promptly to any
comments made by the SEC with respect to the preliminary proxy or informa
tion statement and cause a definitive proxy or information statement,
including
34
<PAGE>
any amendments or supplements thereto (the "Proxy Statement") to be mailed
to its stockholders at the earliest practicable date, provided that no
amendments or supplements to the Proxy Statement will be made by the
Company without consultation with Alcoa and its counsel.
(b) Alcoa shall vote, or cause to be voted, all of the Shares acquired
in the Offer or otherwise then owned by it, the Purchaser or any of Alcoa's
other Subsidiaries in favor of the approval and adoption of this Agreement.
(c) Notwithstanding the provisions of paragraphs (a) and (b) above, in
the event that Alcoa, the Purchaser and any other Subsidiaries of Alcoa shall
acquire in the aggregate at least 90% of the outstanding shares of each class of
capital stock of the Company pursuant to the Offer or otherwise, the parties
hereto shall, subject to Article VI hereof, take all necessary and appropriate
action to cause the Merger to become effective as soon as practicable after such
acquisition, without a meeting of stockholders of the Company, in accordance
with Section 253 of the DGCL.
Section 5.4 Reasonable Best Efforts; Further Assurances.
-------------------------------------------
(a) Subject to the terms and conditions of this Agreement and
applicable law, each of the parties shall act in good faith and use reasonable
best efforts to take, or cause to be taken, all actions, and to do, or cause to
be done, all things necessary, proper or advisable to consummate and make
effective the transactions contemplated by this Agreement as soon as
practicable. Without limiting the foregoing, the parties shall (and shall cause
their respective Subsidiaries, and use reasonable best efforts to cause their
respective affiliates, directors, officers, employees, agents, attorneys,
accountants and representatives, to) (i) consult and cooperate with and provide
assistance to each other in the preparation and filing with the SEC of the Offer
Documents, the Schedule 14D-9, the preliminary Proxy Statement and the Proxy
Statement and all necessary amendments or supplements thereto; (ii) obtain all
consents, approvals, waivers, licenses, permits, authorizations, registrations,
qualifications or other permissions or actions by, and give all necessary
notices to, and make all filings with and applications and submissions to, any
Governmental Entity or other Person necessary in connection with the
consummation of the transactions contemplated by this Agreement as soon as
reasonably practicable; (iii) provide all such information concerning such
party, its Subsidiaries and its officers, directors, employees, partners and
affiliates as may be necessary or reasonably requested in connection with any of
the foregoing; (iv) avoid the entry of, or have vacated or terminated, any
decree, order, or judgment that would restrain, prevent, or delay the
consummation of the Offer or the
35
<PAGE>
Merger, including but not limited to defending through litigation on the merits
any claim asserted in any court by any Person; (v) take any and all reasonable
steps necessary to avoid or eliminate every impediment under any antitrust,
competition, or trade regulation law that is asserted by any Governmental Entity
with respect to the Offer or the Merger so as to enable the consummation of the
Offer or the Merger to occur as expeditiously as possible; and (vi) divest such
plants, assets or businesses of the Company or any of its Subsidiaries
(including entering into customary ancillary agreements on commercially
reasonable terms relating to any such divestiture of such assets or businesses)
as may be required in order to avoid the filing of a lawsuit by any Governmental
Entity seeking to enjoin the purchase of Shares pursuant to the Offer or the
consummation of the Merger, or the entry of, or to effect the dissolution of,
any injunction, temporary restraining order, or other order in any suit or
proceeding, which would otherwise have the effect of preventing or delaying the
purchase of Shares pursuant to the Offer or the consummation of the Merger;
provided, however, that Alcoa shall not be required to take any actions in
connection with, or agree to, any hold separate order, sale, divestiture, or
disposition of plants, assets and businesses of (x) Alcoa or any of its
Subsidiaries or (y) of the Company or any of its Subsidiaries that accounted in
the aggregate for more than $60 million in revenues in the Company's 1999 fiscal
year. At the request of Alcoa, the Company shall agree to divest, hold separate
or otherwise take or commit to take any action that limits its freedom of action
with respect to, or its ability to retain, any of the businesses, product lines
or assets of the Company or any of its Subsidiaries, provided that any such
action shall be conditioned upon the consummation of the purchase of Shares in
the Offer. Prior to making any application to or filing with a Governmental
Entity or other entity in connection with this Agreement (other than filing
under the HSR Act), each party shall provide the other party with drafts thereof
and afford the other party a reasonable opportunity to comment on such drafts.
(b) The Company, Alcoa and the Purchaser shall keep the other
reasonably apprised of the status of matters relating to completion of the
transactions contemplated hereby, including promptly furnishing the other with
copies of notices or other communications received by Alcoa, the Purchaser or
the Company, as the case may be, or any of their respective Subsidiaries, from
any third party and/or any Governmental Entity with respect to the transactions
contemplated by this Agreement.
36
<PAGE>
Section 5.5 Employee Stock Options and Other Employee Benefits.
--------------------------------------------------
(a) The Company shall use its reasonable best efforts to cause each
outstanding option to purchase shares of Company Common Stock (including any
related alternative rights) granted under any stock option or compensation plan
or arrangement of the Company or its Subsidiaries (collectively, the "Company
Option Plans") (including those granted to current or former employees and
directors of the Company or any of its Subsidiaries) (the "Employee Stock
Options") to become exercisable, and each share of restricted Company Common
Stock granted under the Company Option Plans, to vest in full and become fully
transferable and free of restrictions, either prior to the purchase of the
Shares pursuant to the Offer or immediately prior to the Effective Time, as
permitted pursuant to the terms and conditions of the applicable Company Option
Plan. The Company shall offer to each holder of an Employee Stock Option that
is outstanding immediately prior to the first purchase of Shares pursuant to the
Offer (the "Purchase Date") (whether or not then presently exercisable or
vested) to cancel such Employee Stock Option in exchange for an amount in cash
equal to the product obtained by multiplying (x) the difference between the
Offer Price and the per share exercise price of such Employee Stock Option, and
(y) the number of shares of Company Common Stock covered by such Employee Stock
Option. All payments in respect of such Employee Stock Options shall be made as
promptly as practicable after the Purchase Date, subject to the collection of
all applicable withholding Taxes required by law to be collected by the Company.
Each Employee Stock Option, the holder of which does not accept such offer, that
remains outstanding immediately before the Effective Time shall be assumed by
Alcoa and converted, effective as of the Effective Time, into an option with
respect to that number (the "New Share Number") of shares of common stock, par
value $1.00 per share, of Alcoa ("Alcoa Common Stock") that equals the number of
shares of Company Common Stock subject to such Employee Stock Option immediately
before the Effective Time, times an amount equal to the Merger Consideration
divided by the Alcoa Share Value (as defined below), rounded to the nearest
whole number, with a per-share exercise price equal to the aggregate exercise
price of such option immediately before the Effective Time, divided by the New
Share Number, rounded to the nearest whole cent; provided, that in the case of
any such option that was granted as an "incentive stock option" within the
meaning of Section 422 of the Code and did not cease to qualify as such as a
result of any acceleration of vesting provided for above or otherwise, the
number of shares shall be rounded down to the nearest whole number to determine
the New Share Number, and the new per-share exercise price shall be determined
by rounding up to the nearest whole cent. The Alcoa Share Value means the
average of the daily high and low trading prices of the Alcoa Common Stock on
the New York Stock Exchange on each
37
<PAGE>
trading day during the period of 30 days ending the second trading day prior to
the Effective Time. Upon the Effective Time or as soon as reasonably practicable
thereafter, Alcoa shall file with the SEC a Registration Statement or
Registration Statements on Form S-8 covering all shares of Alcoa Common Stock to
be issued pursuant to the options converted into options to purchase shares of
Alcoa Common Stock pursuant to the terms of this Section 5.5(a) and shall cause
such Registration Statement to remain effective so long as Alcoa continues to
have a registration statement on Form S-8 (or any successor form) outstanding
for other options to purchase Alcoa Common Stock. Prior to the Purchase Date,
the Company and Alcoa shall take all action as may be necessary to carry out the
terms of this Section 5.5.
(b) For the period from the Purchase Date through and including
December 31, 2001, Alcoa shall, or shall cause the Company or the Surviving
Corporation to, maintain employee benefit plans, programs and arrangements which
are, in the aggregate, for the employees who were employees of the Company or
any Subsidiary of the Company immediately prior to the Purchase Date and
continue to be employees of Alcoa, the Surviving Corporation or any other
Subsidiary of Alcoa, no less favorable than those provided by the Company and
its Subsidiaries as of the Purchase Date. Each person who is an employee or
former employee of the Company or its Subsidiaries immediately prior to the
Purchase Date (a "Company Employee") shall, without duplication of benefits, be
given credit for all service with the Company or any of its Subsidiaries (and
service credited by the Company or any of its Subsidiar ies) prior to the
Purchase Date, using the same methodology utilized by the Company as of
immediately before the Purchase Date for crediting service and determining
levels of benefits, under (i) all employee benefit plans, programs and
arrangements maintained by or contributed to by Alcoa and its Subsidiaries
(including, without limitation, the Company and the Surviving Corporation) in
which such Company Employees become participants for purposes of eligibility to
participate, vesting and determination of level of benefits (excluding, however,
benefit accrual under any defined benefit plans), and (ii) severance plans for
purposes of calculating the amount of each Company Employee's severance
benefits. Alcoa, the Company and the Surviving Company shall (x) waive all
limitations as to preexisting conditions exclusions and waiting periods with
respect to participation and coverage requirements applicable to the Company
Employees under any welfare benefit plans that such Company Employees may be
eligible to participate in after the Purchase Date, other than limitations or
waiting periods that are already in effect with respect to such employees and
that have not been satisfied as of the Purchase Date under any welfare benefit
plan maintained for the Company Employees immediately prior to the Purchase
Date, and (y) provide each Company Employee with credit for any co-payments and
deductibles paid prior to the
38
<PAGE>
Purchase Date in satisfying any applicable deductible or out-of-pocket
requirements under any welfare plans that such Company Employees are eligible to
participate in after the Purchase Date.
(c) Without limiting the generality of the foregoing, for the period
through and including December 31, 2001, Alcoa shall provide, and shall cause
its Subsidiaries (including, without limitation, the Company and the Surviving
Corporation) to provide Company Employees whose employment is terminated
following the Purchase Date with severance benefits on terms and conditions, and
in amounts, that are not less favorable than those provided under the Company
Severance Pay Plan.
(d) Without limiting the generality of the foregoing, Alcoa shall
honor and provide, and/or shall cause it Subsidiaries (including, without
limitation, the Company and the Surviving Corporation) to honor provide, the
agreements and change-of-control payments and benefits set forth in Section
5.5(d) of the Company Disclosure Schedule.
(e) The Company shall take the actions provided for in Item 4 of
Section 5.1 of the Company Disclosure Schedule with respect to its qualified
pension plans.
Section 5.6 Takeover Statute. If any "fair price," "moratorium,"
----------------
"control share acquisition" or other form of anti-takeover statute or regulation
shall become applicable to the transactions contemplated hereby, each of the
Company, Alcoa and the Purchaser and the members of their respective Boards of
Directors shall grant such approvals and take such actions as are reasonably
necessary so that the transactions contemplated hereby may be consummated as
promptly as practicable on the terms contemplated hereby and otherwise act to
eliminate or minimize the effects of such statute or regulation on the
transactions contemplated hereby.
Section 5.7 No Solicitation by the Company.
------------------------------
(a) Neither the Company nor any of its Subsidiaries nor any of the
officers and directors of any of them shall, and the Company shall direct and
use its reasonable best efforts to cause its and its Subsidiaries' employees,
agents and representatives, including any investment banker, attorney or
accountant retained by it or any of its Subsidiaries (the Company, its
Subsidiaries and their respective officers, directors, employees, agents and
representatives being the "Company Representatives")
39
<PAGE>
not to, directly or indirectly through another Person, (i) initiate, solicit,
encourage or otherwise knowingly facilitate any inquiries (by way of furnishing
information or otherwise) or the making of any inquiry, proposal or offer from
any Person which constitutes an Acquisition Proposal (or would reasonably be
expected to lead to an Acquisition Proposal) or (ii) participate in any
discussions or negotiations regarding an Acquisition Proposal; provided,
however, that the Company's Board of Directors may, or may authorize the Company
Representatives to, in response to an Acquisition Proposal that the Board of
Directors of the Company concludes in good faith is an Incipient Superior
Proposal, (x) furnish information with respect to the Company and its
Subsidiaries to any Person making such Acquisition Proposal pursuant to a
customary confidentiality agreement and (y) participate in discussions or
negotiations regarding such Acquisition Proposal, provided that, prior to taking
any such action, the Company provides reasonable advance notice to Alcoa that it
is taking such action. For purposes of this Agreement "Acquisition Proposal"
means any direct or indirect inquiry, proposal or offer (or any improvement,
restatement, amendment, renewal or reiteration thereof) relating to the
acquisition or purchase of a business or shares of any class of equity
securities of the Company or any of its Subsidiaries, any tender offer or
exchange offer that, if consummated, would result in any Person beneficially
owning any class of equity securities of the Company or any of its Subsidiaries,
or any merger, reorganiza tion, share exchange, consolidation, business
combination, recapitalization, liquidation, dissolution or similar transaction
(a "Business Combination Transaction") involving the Company or any of its
Subsidiaries, or any purchase or sale of a substantial portion of the
consolidated assets (including without limitation stock of Subsidiaries owned
directly or indirectly by the Company) of the Company or any of its Subsidiaries
(an "Asset Transaction"), other than the transactions contemplated by this
Agreement or as permitted by Section 5.1 of this Agreement. For purposes of this
Agreement, (A) "Incipient Superior Proposal" shall mean an unsolicited bona fide
written Acquisition Proposal that the Board of Directors of the Company
concludes in good faith (after consultation with the Company's financial
advisor) would, if consummated, provide greater aggregate value to the Company's
stockholders from a financial point of view than the transactions contemplated
by this Agreement; provided that for purposes of this definition the term
"Acquisition Proposal" shall have the meaning set forth above, except that (x)
references to "shares of any class of equity securities of the Company" shall be
deemed to be references to "100% of the outstanding Shares" and (y) an
"Acquisition Proposal" shall be deemed to refer only to a Business Combination
Transaction involving the Company or, with respect to an Asset Transaction, such
transaction must involve the assets of the Company and its Subsidiaries, taken
as a whole, and not any Subsidiary of the Company alone and (B) "Superior
Proposal" shall mean an Incipient Superior Proposal for which any required
financing is committed or
40
<PAGE>
which, in the good faith judgment of the Board of Directors in the Company
(after consultation with its financial advisor), is capable of being financed by
the Person making the Acquisition Proposal.
(b) Except as expressly permitted by this Section 5.7, neither
the Company's Board of Directors nor any committee thereof shall (i) withdraw,
modify or change, or propose publicly to withdraw, modify or change, in a manner
adverse to Alcoa, the recommendation by such Board of Directors or such
committee of the Offer, the Merger or this Agreement unless the Board of
Directors of the Company shall have determined in good faith, after consultation
with its financial advisor, that the Offer, the Merger or this Agreement is no
longer in the best interests of the Company's stockhold ers and that such
withdrawal, modification or change is, therefore, required in order to satisfy
its fiduciary duties to the Company's stockholders under applicable law, (ii)
approve or recommend, or propose publicly to approve or recommend, any
Acquisition Proposal, or (iii) cause the Company to enter into any letter of
intent, agreement in principle, acquisition agreement or other similar agreement
(each, an "Acquisition Agreement") related to any Acquisition Proposal.
Notwithstanding the foregoing, the Company may, in response to a Superior
Proposal, (x) take any of the actions described in clauses (i) or (ii) above or
(y) subject to this paragraph (b), terminate this Agreement (and concurrently
with or after such termination, if it so chooses, cause the Company to enter
into any Acquisition Agreement with respect to any Acquisition Proposal) but
only after the third business day following Alcoa's receipt of written notice
advising Alcoa that the Company's Board of Directors is prepared to accept an
Acquisition Proposal, and attaching the most current version of any such
Acquisition Proposal or any draft of an Acquisition Agreement; provided, the
Company is not in breach of any of its obligations under this Section 5.7.
(c) In addition to the obligations of the Company set forth in
paragraphs (a) and (b) of this Section 5.7, the Company shall promptly (but in
any event within one business day) notify Alcoa orally and in writing of any
Acquisition Proposal or any inquiry regarding the making of any Acquisition
Proposal, indicating, in connection with such notice, the name of such Person
making such Acquisition Proposal or inquiry and the substance of any such
Acquisition Proposal or inquiry. The Company thereafter shall keep Alcoa
reasonably informed of the status and terms (including amendments or proposed
amendments) of any such Acquisition Proposals or inquiries and the status of any
discussions or negotiations relating thereto.
(d) Nothing contained in this Section 5.7 shall prohibit the Company
or its Board of Directors from at any time taking and disclosing to its
41
<PAGE>
stockholders a position contemplated by Rule 14e-2 promulgated under the
Exchange Act or from making any disclosure to the Company's stockholders
required by applicable law.
Section 5.8 Public Announcements. Alcoa and the Company agree that
--------------------
neither one of them will issue any press release or otherwise make any public
statement or respond to any press inquiry with respect to this Agreement or the
transactions contemplated hereby without the prior approval of the other party
(which approval will not be unreasonably withheld or delayed), except as may be
required by applicable law or the rules of any stock exchange on which such
party's securities are listed.
Section 5.9 Indemnification; Insurance. (a) From and after the
--------------------------
Purchase Date, Alcoa will indemnify and hold harmless each present and former
director and officer of the Company and its Subsidiaries (the "Indemnified
Parties"), against any costs or expenses (including attorneys' fees), judgments,
fines, losses, claims, damages or liabilities incurred in connection with any
claim, action, suit, proceeding or investigation, whether civil, criminal,
administrative or investigative, by reason of the fact that such individual is
or was a director, officer, employee or agent of the Company or any of its
Subsidiaries, or is or was serving at the request of the Company or any of its
Subsidiaries as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise, arising out of or
pertaining to matters existing or occurring at or prior to the Effective Time,
whether asserted or claimed prior to, at or after the purchase of Shares in the
Offer, to the fullest extent permitted under applicable law, and Alcoa shall
also advance fees and expenses (including attorneys' fees) as incurred to the
fullest extent permitted under applicable law.
(b) The Certificate of Incorporation of the Company shall, from and
after the Purchase Date, and the Certificate of Incorporation of the Surviving
Corporation shall, from and after the Effective Time, contain provisions no less
favorable with respect to indemnification than are set forth as of the date of
this Agreement in Article Ninth of the Certificate of Incorporation of the
Company, which provisions shall not be amended, repealed or otherwise modified
for a period of six years from the Purchase Date in any manner that would
adversely affect the rights thereunder of individuals who at the Purchase Date
were directors, officers or employees of the Company; provided that nothing
contained herein shall limit Alcoa's ability to merge the Company into Alcoa or
any of its Subsidiaries or otherwise eliminate the Company's corporate
existence.
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(c) For six years from the Effective Time, Alcoa shall maintain in
effect the Company's and its Subsidiaries' current directors' and officers'
liability insurance policy (the "Policies") covering those persons who are
currently covered by the Policies; provided, however, that in no event shall
Alcoa be required to expend in any one year an amount in excess of the annual
premiums currently paid by the Company and its Subsidiaries for such insurance,
and, provided, further, that if the annual premiums of such insurance coverage
exceeds such amount, Alcoa shall be obligated to obtain policies with the
greatest coverage available for a cost not exceeding such amount; and provided,
further, that Alcoa may meet its obligations under this paragraph by covering
the above persons under Alcoa's insurance policy on the terms described above
that expressly provide coverage for any acts which are covered by the existing
policies of the Company and its Subsidiaries.
(d) Nothing in this Agreement is intended to, shall be construed to,
or shall release, waive or impair any rights to directors' and officers'
insurance claims under any policy that is or has been in existence with respect
to the Company or any of its Subsidiaries or any of their respective officers,
directors or employees, it being understood and agreed that the indemnification
provided for in this Section 5.9 is not prior to or in substitution for any
such claims under such policies.
Section 5.10 Disclosure Schedule Supplements. From time to time
-------------------------------
after the date of this Agreement and prior to the Effective Time, the Company
will promptly supplement or amend the Company Disclosure Schedule with respect
to any matter hereafter arising which, if existing or occurring at or prior to
the date of this Agreement, would have been required to be set forth or
described in the Company Disclosure Schedule or which is necessary to correct
any information in a schedule or in any representation and warranty of the
Company which has been rendered inaccurate thereby in any material respect;
provided, however, that the Company may not update Sections 5.1 and 5.5(d) of
the Company Disclosure Schedule. For purposes of determining the accuracy of
the representations and warranties of the Company contained in this Agreement in
order to determine the fulfillment of the conditions set forth in clause (f) of
Annex A, the Company Disclosure Schedule shall be deemed to include only that
information contained therein on the date of this Agreement and shall be deemed
to exclude any information contained in any subsequent supplement or amendment
thereto.
43
<PAGE>
Section 5.11 Howmet Acquisition. Nothing in this Agreement shall
------------------
prevent Alcoa or any affiliate of Alcoa from offering to acquire or agreeing
with Howmet to acquire all of the shares of Howmet Common Stock not owned by the
Company or any of its Subsidiaries (a "Howmet Transaction") in accordance with
the terms of the Corporate Agreement, dated as of December 2, 1997, by and among
the Company, Cordant Technologies Holding Company and Howmet, as amended;
provided, however, Alcoa agrees that it will not acquire any shares of Howmet
Common Stock prior to the Purchaser's purchase of Shares pursuant to the Offer.
ARTICLE VI
CONDITIONS TO THE MERGER
Section 6.1 Conditions to Each Party's Obligation to Effect the
---------------------------------------------------
Merger. The respective obligations of each party to effect the Merger shall be
- ------
subject to the fulfillment at or prior to the Effective Time of the following
conditions:
(a) The Company Stockholder Approval shall have been obtained, if
required by applicable law.
(b) No statute, rule, regulation, executive order, decree, ruling or
permanent injunction shall have been enacted, entered, promulgated or enforced
by any Governmental Entity which prohibits the consummation of the Merger
substantially on the terms contemplated hereby or has the effect of making the
acquisition of Shares by Alcoa or the Purchaser or any affiliate of either of
them illegal.
(c) Alcoa or the Purchaser or any affiliate of either of them shall
have purchased Shares pursuant to the Offer, except that this condition shall
not be a condition to Alcoa's and the Purchaser's obligation to effect the
Merger if Alcoa, the Purchaser or such affiliate shall have failed to purchase
Shares pursuant to the Offer in breach of their obligations under this
Agreement.
(d) The applicable waiting period under the HSR Act shall have
expired or been terminated.
44
<PAGE>
ARTICLE VII
TERMINATION
Section 7.1 Termination. This Agreement may be terminated and
-----------
the other transactions contemplated herein abandoned at any time prior to the
Effective Time, whether before or after obtaining the Company Stockholder
Approval:
(a) by the mutual written consent of the Company (including, from and
after the Purchase Date, the Independent Director Approval contemplated by
Section 1.3(c)), Alcoa and the Purchaser;
(b) by either Alcoa or the Company if (i) (1) the Offer shall have
expired without any Shares being purchased pursuant thereto, or (2) the Offer
has not been consummated on or before September 30, 2000 (the "Drop Dead Date");
provided, however, that the right to terminate this Agreement pursuant to this
Section 7.1(b)(i) shall not be available to any party whose failure to fulfill
any obligation under this Agreement or the Offer has been the cause of, or
resulted in, the failure of the Shares to have been purchased pursuant to the
Offer; (ii) a statute, rule, regulation or executive order shall have been
enacted, entered or promulgated prohibiting the consummation of the Offer or the
Merger substantially on the terms contemplated hereby; or (iii) an order,
decree, ruling or injunction shall have been entered perma nently restraining,
enjoining or otherwise prohibiting the consummation of the Offer or the Merger
substantially on the terms contemplated hereby and such order, decree, ruling or
injunction shall have become final and non-appealable; provided, that the party
seeking to terminate this Agreement pursuant to this Section 7.1(b)(iii) shall
have used its reasonable best efforts to remove such order, decree, ruling or
injunction and shall not be in violation of Section 5.4;
(c) by Alcoa, if due to an occurrence or circumstance, other than as a
result of a breach by Alcoa or the Purchaser of its obligations hereunder or
under the Offer, resulting in a failure to satisfy any condition set forth in
Annex A hereto, the Purchaser shall have (i) failed to commence the Offer within
30 days following the date of this Agreement, or (ii) terminated the Offer
without having accepted any Shares for payment thereunder;
(d) by the Company, upon approval of its Board of Directors, if the
Purchaser shall have terminated the Offer without having accepted any Shares for
payment thereunder, other than as a result of a breach by the Company of its
obligations
45
<PAGE>
hereunder, that would result in a failure to satisfy any of the
conditions set forth in Annex A hereto;
(e) by the Company, in accordance with Section 5.7(b); provided, that
such termination shall not be effective unless and until the Company shall have
paid to Alcoa the fee described in Section 7.3 hereof and shall have complied
with the provisions of Sections 5.7(b) and (c).
Section 7.2 Effect of Termination. In the event of termination of
---------------------
this Agreement pursuant to Section 7.1, written notice thereof shall forthwith
be given to the other party or parties specifying the provision hereof pursuant
to which such termination is made, and this Agreement shall terminate and be of
no further force and effect (except for the provisions of Sections 5.2, 7.3 and
8.2 in the case of termination of this Agreement at any time, and Section 5.5 in
the case of a termination following the purchase of Shares pursuant to the
Offer), and there shall be no other liability on the part of Alcoa, the
Purchaser or the Company or their respective officers or directors except
liability arising out of a willful breach of this Agreement. In the event of
termination of this Agreement pursuant to Section 7.1 prior to the expiration of
the Offer, Alcoa and the Purchaser will promptly terminate the Offer upon such
termination of this Agreement without the purchase of Shares thereunder.
Section 7.3 Termination Fee. In the event that this Agreement
---------------
shall have been terminated pursuant to Section 7.1(c) as a result of the failure
of the condition of the Offer set forth in paragraph (e) of Annex A hereto or
Section 7.1(e), the Company shall immediately pay Alcoa a fee equal to $75
million (the "Termination Fee"), payable by wire transfer of immediately
available funds, the receipt of which by Alcoa in the case of termination
pursuant to Section 7.1(e), shall be a condition to the effectiveness of such
termination. The Company acknowledges that the agreements contained in this
Section 7.3 are an integral part of the transactions contemplated by this
Agreement, and that, without these agreements, Alcoa and the Purchaser would not
enter into this Agreement; accordingly, if the Company fails to pay the amount
due pursuant to this Section 7.3, and, in order to obtain such payment, Alcoa
commences a suit which results in a judgment against the Company for the fee set
forth in this Section 7.3, the Company shall pay to Alcoa its costs and expenses
(including attorneys' fees and expenses) in connection with such suit, together
with interest on the amount of the fee at the prime rate of Citibank N.A. in
effect on the date such payment was required to be made.
46
<PAGE>
ARTICLE VII
MISCELLANEOUS
Section 8.1 No Survival of Representations and Warranties. None of
---------------------------------------------
the representations and warranties in this Agreement or in any instrument
delivered pursuant to this Agreement shall survive the Effective Time.
Section 8.2 Expenses. Except as otherwise expressly contemplated
--------
by this Agreement, all costs and expenses incurred in connection with this
Agreement and the transactions contemplated hereby shall be paid by the party
incurring such costs and expenses.
Section 8.3 Counterparts; Effectiveness. This Agreement may be
---------------------------
executed in two or more separate counterparts, each of which shall be deemed to
be an original but all of which shall constitute one and the same agreement.
This Agreement shall become effective when each party hereto shall have received
counterparts hereof signed by each of the other parties hereto.
Section 8.4 Governing Law. This Agreement shall be governed by and
-------------
construed in accordance with the laws of the State of Delaware, without regard
to the principles of conflicts of laws thereof.
Section 8.5 Notices. All notices and other communications
-------
hereunder shall be in writing (including telecopy or similar writing) and shall
be effective (a) if given by telecopy, when such telecopy is transmitted to the
telecopy number specified in this Section 8.5 and the appropriate telecopy
confirmation is received or (b) if given by any other means, when delivered at
the address specified in this Section 8.5:
To Alcoa or the Purchaser:
Alcoa Inc.
201 Isabella Street
Pittsburgh, Pennsylvania 15212-5858
Attention: Lawrence R. Purtell, Esq.
Telecopy: (412) 553-3200
47
<PAGE>
copy to:
Skadden, Arps, Slate, Meagher & Flom LLP
Four Times Square
New York, New York 10036-6522
Attention: J. Michael Schell, Esq.
Margaret L. Wolff, Esq.
Telecopy: (212) 735-2000
To the Company:
Cordant Technologies Inc.
15 West S. Temple
Suite 1600
Salt Lake City, Utah 84101-1532
Attention: Corporate Secretary
Telecopy: (801) 933-4203
copy to:
Wachtell, Lipton, Rosen & Katz
51 West 52/nd/ Street
New York, New York 10019-6150
Attention: Eric S. Robinson, Esq.
Telecopy: (212) 403-2000
Section 8.6 Assignment; Binding Effect. Neither this Agreement nor
--------------------------
any of the rights, interests or obligations hereunder shall be assigned by any
of the parties hereto (whether by operation of law or otherwise) without the
prior written consent of the other parties, except that the Purchaser may
assign, in its sole discretion, all or any of its rights and interests hereunder
to Alcoa or to any direct or indirect wholly owned Subsidiary of Alcoa, provided
that no such assignment shall relieve the Purchaser of its obligations hereunder
if such assignee does not perform such obligations. Subject to the preceding
sentence, this Agreement shall be binding upon and shall inure to the benefit of
the parties hereto and their respective successors and permitted assigns. Any
assignment not permitted under this Section 8.6 shall be null and void.
48
<PAGE>
Section 8.7 Severability. Any term or provision of this Agreement
------------
which is invalid or unenforceable in any jurisdiction shall, as to that
jurisdiction, be ineffective to the extent of such invalidity or
unenforceability without rendering invalid or unenforceable the remaining terms
and provisions of this Agreement in any other jurisdiction. If any provision of
this Agreement is so broad as to be unenforceable, such provision shall be
interpreted to be only so broad as is enforceable.
Section 8.8 Enforcement of Agreement. The parties hereto agree
------------------------
that money damages or other remedy at law would not be sufficient or adequate
remedy for any breach or violation of, or a default under, this Agreement by
them and that in addition to all other remedies available to them, each of them
shall be entitled to the fullest extent permitted by law to an injunction
restraining such breach, violation or default or threatened breach, violation or
default and to any other equitable relief, including, without limitation,
specific performance, without bond or other security being required.
Section 8.9 Entire Agreement; No Third-Party Beneficiaries. This
----------------------------------------------
Agreement together with the Disclosure Schedule and exhibits hereto and the
Confidentiality Agreement constitute the entire agreement, and supersede all
other prior agreements and understandings, both written and oral, among the
parties, or any of them, with respect to the subject matter hereof and thereof
and except for the provisions of Section 5.5(d) (with respect to the individuals
identified by name on Section 5.5(d) of the Company Disclosure Schedule) and
Section 5.9 hereof, is not intended to and shall not confer upon any Person
other than the parties hereto any rights or remedies hereunder.
Section 8.10 Headings. Headings of the Articles and Sections of
--------
this Agreement are for convenience of the parties only, and shall be given no
substantive or interpretive effect whatsoever.
Section 8.11 Definitions. References in this Agreement to (a)
-----------
"Subsidiaries" of the Company or Alcoa shall mean any corporation or other form
of legal entity of which more than 50% of the outstanding voting securities are
on the date hereof directly or indirectly owned by the Company or Alcoa or in
which the Company or Alcoa has the right to elect a majority of the members of
the board of directors or other similar governing body; (b) "Significant
Subsidiaries" shall mean Subsidiaries which constitute "significant
subsidiaries" under Rule 405 promulgated by the SEC under the Securities Act;
(c) "affiliates" shall mean, as to any Person, any other Person which, directly
or indirectly, controls, or is controlled by, or is under common control
49
<PAGE>
with, such Person; (d) "Person" shall mean an individual, a corporation, a
partnership, an association, a trust or any other entity or organization,
including, without limitation, a Governmental Entity. As used in the definition
of "affiliates," "control" (including, with its correlative meanings,
"controlled by" and "under common control with") shall mean the possession,
directly or indirectly, of the power to direct or cause the direction of
management or policies of a Person, whether through the ownership of securities
or partnership or other ownership interests, by contract or otherwise.
"Including," as used herein, shall mean "including, without limitation."
Section 8.12 Finders or Brokers. Except for Morgan Stanley & Co.
------------------
Incorporated, a copy of whose engagement agreement has been provided to Alcoa,
with respect to the Company, and Salomon Smith Barney, Inc. with respect to
Alcoa, neither the Company nor Alcoa nor any of their respective Subsidiaries
has employed any investment banker, broker, finder or intermediary in connection
with the transactions contemplated hereby who would be entitled to any fee or
any commission in connection with or upon consummation of the Offer or the
Merger.
Section 8.13 Amendment or Supplement. At any time prior to the
-----------------------
Effective Time, this Agreement may be amended or supplemented in any and all
respects, whether before or after the Company Stockholder Approval, by written
agreement of the parties hereto, by action taken by their respective Boards of
Directors (which in the case of the Company shall include the Independent
Director Approval contemplated in Section 1.3(c)), with respect to any of the
terms contained in this Agreement; provided, however that following the Company
Stockholder Approval there shall be no amendment or change to the provisions
hereof which would reduce the amount or change the type of consideration into
which each Share shall be converted upon consummation of the Merger or other
change requiring stockholder approval without further approval by the
stockholders of the Company.
Section 8.14 Extension of Time, Waiver, Etc. At any time prior to
-------------------------------
the Effective Time, any party may (a) extend the time for the performance of any
of the obligations or acts of any other party hereto; (b) waive any inaccuracies
in the representations and warranties of any other party hereto contained herein
or in any document delivered pursuant hereto; or (c) subject to the proviso of
Section 8.13 waive compliance with any of the agreements or conditions of any
other party hereto contained herein; provided, however, in the case of the
Company following the acceptance of Shares for payment in the Offer, the
Independent Director Approval contemplated in Section 1.3(c) is obtained.
Notwithstanding the foregoing no failure or delay by the Company, Alcoa or the
Purchaser in exercising any right hereunder shall operate as a
50
<PAGE>
waiver thereof nor shall any single or partial exercise thereof preclude any
other or further exercise thereof or the exercise of any other right hereunder.
Any agreement on the part of a party hereto to any such extension or waiver
shall be valid only if set forth in an instrument in writing signed on behalf of
such party.
51
<PAGE>
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be duly executed and delivered as of the date first above written.
ALCOA INC.
By: /s/ Richard B. Kelson
---------------------
Name: Richard B. Kelson
Title: Chief Financial Officer
OMEGA ACQUISITION CORP.
By: /s/ Barbara Jeremiah
--------------------
Name: Barbara Jeremiah
Title: Vice President
CORDANT TECHNOLOGIES INC.
By: /s/ James R. Wilson
-------------------
Name: James R. Wilson
Title: Chief Executive Officer
<PAGE>
ANNEX A
-------
Conditions to the Offer
-----------------------
The capitalized terms used in this Annex A have the meanings set forth
in the attached Agreement, except that the term "the Agreement" shall be deemed
to refer to the attached Agreement.
Notwithstanding any other provision of the Offer, the Purchaser shall
not be required to accept for payment or, subject to any applicable rules and
regulations of the SEC, including Rule 14e-1(c) promulgated under the Exchange
Act (relating to the Purchaser's obligation to pay for or return tendered Shares
promptly after termination or withdrawal of the Offer), pay for, and may
postpone the acceptance for payment of and payment for Shares tendered, and,
except as set forth in the Agreement, terminate the Offer as to any Shares not
then paid for if (i) the Minimum Condition shall not have been satisfied at the
scheduled expiration date of the Offer, (ii) any applicable waiting period
under the HSR Act shall not have expired or been terminated, the notification of
and approval by the European Commission under the EU Council Regulation 4064/89,
as amended, shall not have been received or the applicable waiting period under
the Canadian Competition Act shall not have expired, in each case to the extent
applicable to the purchase of Shares in the Offer (the "Regulatory Condition"),
prior to the expiration of the Offer, or (iii) immediately prior to the
expiration of the Offer, any of the following conditions shall exist:
(a) there shall have been entered, enforced or issued by any
Governmental Entity, any judgment, order, injunction or decree (i) which makes
illegal, restrains or prohibits or makes materially more costly the making of
the Offer, the acceptance for payment of, or payment for, any Shares by Alcoa,
the Purchaser or any other affiliate of Alcoa, or the consummation of the Merger
transaction; (ii) which prohibits or limits materially the ownership or
operation by the Company, Alcoa or any of their Subsidiaries of all or any
material portion of the business or assets of the Company, Alcoa or any of their
Subsidiaries, or compels the Company, Alcoa or any of their Subsidiaries to
dispose of or hold separate all or any portion of the business or assets of the
Company, Alcoa or any of their Subsidiaries; (iii) which imposes or confirms
limitations on the ability of Alcoa, the Purchaser or any other affiliate of
Alcoa to exercise full rights of ownership of any Shares, including, without
limitation, the right to vote any Shares acquired by the Purchaser pursuant to
the Offer or otherwise on all matters properly presented to the Company's
stockholders, including, without limitation, the approval and adoption of this
Agreement and the transactions contemplated by this
i
<PAGE>
Agreement; (iv) which requires divestiture by Alcoa, the Purchaser or any other
affiliate of Alcoa of any Shares; or (v) which otherwise would have a Material
Adverse Effect on the Company to the extent that it relates to or arises out of
the transaction contem plated by this Agreement or Alcoa, except in the case of
clauses (i) through (v), where such events are consistent with or result from
Alcoa's, the Purchaser's and the Company's obligations under Section 5.4 of the
Agreement;
(b) there shall have been any statute, rule, regulation, legislation
or interpretation enacted, enforced, promulgated, amended or, issued by any
Governmental Entity or deemed by any Governmental Entity applicable to (i)
Alcoa, the Company or any Subsidiary or affiliate of Alcoa or the Company or
(ii) any transaction contemplated by this Agreement, other than the HSR Act, the
EU Council Regulation 4064/89, as amended, and the Canadian Competition Act,
which is reasonably likely to result, directly or indirectly, in any of the
consequences referred to in clauses (i) through (v) of paragraph (a) above,
except where such events are consistent with or result from Alcoa's, the
Purchaser's and the Company's obligations under Section 5.4 of the Agreement;
(c) there shall have occurred any changes, conditions, events or
developments that would have, or be reasonably likely to have, individually or
in the aggregate, a Material Adverse Effect on the Company;
(d) there shall have occurred (i) any general suspension of, or
limitation on prices for, trading in securities on the New York Stock Exchange
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, (iii) any limitation (whether or not
mandatory) on the extension of credit by banks or other lending institutions in
the United States, (iv) the commencement of a war, material armed hostilities or
any other material international or national calamity involving the United
States or (v) in the case of any of the foregoing existing at the time of the
commencement of the Offer, a material acceleration or worsening thereof;
(e) (i) it shall have been publicly disclosed or the Purchaser shall
have otherwise learned that any Person, other than Alcoa or any of its
affiliates, shall have acquired or entered into a definitive agreement or
agreement in principle to acquire beneficial ownership (determined for the
purposes of this paragraph as set forth in Rule 13d-3 promulgated under the
Exchange Act) of the then outstanding Shares, or shall have been granted any
option, right or warrant, conditional or otherwise, to acquire
ii
<PAGE>
beneficial ownership of 50% or more of the then outstanding Shares, or (ii) the
Board of Directors of the Company or any committee thereof shall have (A)
withdrawn, modified or changed, in a manner adverse to Alcoa or the Purchaser,
the recommenda tion by such Board of Directors or such committee of the Offer,
the Merger or this Agreement, (B) approved or recommended, or proposed publicly
to approve or recommend, an Acquisition Proposal, (C) caused the Company to
enter into any Acquisition Agreement relating to any Acquisition Proposal, or
(D) resolved to do any of the foregoing;
(f) the representations or warranties of the Company set forth in the
Agreement that are qualified by materiality or Material Adverse Effect shall not
be true and correct, or the representations and warranties of the Company set
forth in the Agreement that are not so qualified shall not be true and correct
in all material respects, in each case, as if such representations or warranties
were made as of such time on or after the date of the Agreement (except to the
extent such representations and warranties speak as of a specific date or as of
the date hereof, in which case such representations and warranties shall not be
so true and correct or true and correct in all material respects, as the case
may be, as of such specific date or as of the date hereof, respectively);
(g) the Company shall have failed to perform in any material respect
any material obligation or to comply in any material respect with any material
agreement or covenant of the Company to be performed or complied with by it
under the Agreement;
(h) the Agreement shall have been terminated in accordance with
its terms; or
(i) the Purchaser and the Company shall have agreed that the Purchaser
shall terminate the Offer or postpone the acceptance for payment of or payment
for Shares thereunder;
which, in the reasonable good faith judgment of the Purchaser in any such case,
and regardless of the circumstances (including any action or inaction by Alcoa
or any of its affiliates) giving rise to any such condition, makes it
inadvisable to proceed with such acceptance for payment or payment.
The foregoing conditions are for the benefit of the Purchaser and
Alcoa and may be asserted by the Purchaser or Alcoa regardless of the
circumstances giving rise to any such condition or may be waived by the
Purchaser or Alcoa in whole or in
iii
<PAGE>
part at any time and from time to time in their reasonable discretion. The
failure by Alcoa or the 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.
iv
<PAGE>
EXHIBIT (d)(3)
[LETTERHEAD OF ALCOA, INC.]
March 16, 2000
Howmet International Inc.
475 Steamboat Road
Greenwich, Connecticut 06830
Gentlemen:
Reference is made to the Corporate Agreement, dated as of December 2,
1997, as amended by the Amendment, dated as of March 13, 2000 (as amended, the
"Corporate Agreement"), by and among Cordant Technologies Inc. (formerly named
Thiokol Corporation), a Delaware corporation ("Cordant"), Cordant Technol ogies
Holding Company (formerly named Thiokol Holding Company), a Delaware corporation
and a wholly owned subsidiary of Cordant ("Holding"), and Howmet International
Inc., a Delaware corporation (the "Company").
We hereby agree to comply with Article I of the Corporate Agreement to
the same extent as if we were Cordant unless and until the Agreement and Plan of
Merger, to be dated as of March 14, 2000 (the "Merger Agreement"), by and among
Alcoa Inc. ("Alcoa"), Omega Acquisition Corp. (the "Purchaser") and Cordant is
terminated prior to our purchase of Cordant shares in the Offer (as defined in
the Merger Agreement).
This letter agreement is given in consideration of the Board of
Directors of the Company approving for purposes of Section 203 of the General
Corporation Law of the State of Delaware ("DGCL") Alcoa and the Purchaser
becoming "interested stockholders" pursuant to Alcoa's execution of this letter
agreement or their entry into an agreement with Cordant providing for a tender
offer by the Purchaser to acquire the outstanding shares of common stock, par
value $1.00
<PAGE>
March 16, 2000
Page 2
per share, of Cordant (the "Cordant Common Stock") and the preferred
share purchase rights issued or issuable under the Cordant Rights Agreement (the
"Rights," and together with Cordant Common Stock, the "Shares"), to be followed
by a merger in which they would acquire the remaining Shares and the
consummation of such transactions and the Board of Directors of the Company
taking all appropriate action so that Section 203 of the DGCL, with respect to
the Company, will not be applica ble to Alcoa and the Purchaser by virtue of
such actions.
This letter agreement shall be governed by New York law, without
reference to its conflicts of law principles.
Please confirm your agreement with the foregoing by signing the
enclosed copy of this letter agreement and returning it to us, whereupon it will
become a binding agreement.
Very truly yours,
ALCOA INC.
By: /s/ Lawrence R. Purtell
-------------------------------
Name: Lawrence R. Purtell
Title: Executive Vice President and
General Counsel
ACKNOWLEDGED AND AGREED;
HOWMET INTERNATIONAL INC.
By: /s/ Roland A. Paul
-------------------------------
Name: Roland A. Paul
Title: Vice President and
General Counsel
