SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
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SCHEDULE 13D
(Rule 13d-101)
INFORMATION TO BE INCLUDED IN STATEMENTS FILED PURSUANT TO RULE 13d-1(a) AND
AMENDMENTS THERETO FILED PURSUANT TO RULE 13d-2(a)
(Amendment No. ___)
Premark International, Inc.
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(Name of Issuer)
Common Stock, par value $1.00 per share
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(Title of Class of Securities)
740459102
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(CUSIP Number)
Stewart S. Hudnut
Senior Vice President, General Counsel and Secretary
Illinois Tool Works Inc.
3600 West Lake Avenue
Glenview, Illinois 60025
(847) 724-7500
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(Name, Address and Telephone Number of Persons
Authorized to Receive Notices and Communications)
September 9, 1999
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(Date of Event Which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition which is the subject of this Schedule 13D,
and is filing this schedule because of Rule 13d-1(e), 13d-1(f) or 13d-1(g),
check the following box [ ]
(Continued on following pages)
(Page 1 of 9 Pages)
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CUSIP NO.: [740459102] 13D
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1 NAME OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Illinois Tool Works Inc. (#36-1258310)
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2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ]
(b) [ ]
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3 SEC USE ONLY
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4 SOURCE OF FUNDS
WC, OO
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5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED
PURSUANT TO ITEM 2(d) or 2(e) [ ]
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6 CITIZENSHIP OR PLACE OF ORGANIZATION
DELAWARE
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7 SOLE VOTING POWER
12,203,694 shares
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NUMBER OF
SHARES 8 SHARED VOTING POWER
BENEFICIALLY 0
OWNED BY ----------------------------------------------------
EACH 9 SOLE DISPOSITIVE POWER
REPORTING 12,203,694 shares
PERSON ----------------------------------------------------
10 WITH SHARED DISPOSITIVE POWER
0
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11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
12,203,694 shares
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12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES [ ]
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13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11)
16.6%
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14 TYPE OF REPORTING PERSON
CO
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ITEM 1. SECURITY AND ISSUER
This statement relates to the common stock, par value $1.00 per
share (the "Premark Common Stock"), of Premark International, Inc., a
Delaware corporation ("Premark"). Premark's principal executive offices are
located at 1717 Deerfield Road, Deerfield, Illinois 60015.
ITEM 2. IDENTITY AND BACKGROUND
(a) - (c) This statement is being filed by Illinois Tool Works
Inc., a Delaware corporation ("ITW"). ITW's principal executive offices are
located at 3600 West Lake Avenue, Glenview, Illinois 60025. ITW's principal
business is the manufacture and marketing of a variety of products and
systems that provide specific, problem-solving solutions for a diverse
customer base worldwide. The names, business addresses and principal
occupation or employment (and the name, principal business and address of
any corporation or other organization in which such employment is
conducted) of each of the persons specified by Instruction C of the
Schedule 13D is set forth on Schedule 1.
(d) - (e) To the knowledge of ITW, neither ITW nor any of the
persons specified in Schedule 1 has, during the last five years, been
convicted in a criminal proceeding (excluding traffic violations or similar
misdemeanors) or has been a party to a civil proceeding of a judicial or
administrative body of competent jurisdiction and as a result of such
proceeding was or is subject to a judgment, decree or final order enjoining
future violations of, or prohibiting or mandating activities subject to,
Federal or State securities laws or finding any violation with respect to
such laws.
(f) See (a) - (c) above.
ITEM 3. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
An irrevocable option (the "Option") to purchase up to 12,203,694
shares of Premark Common Stock (the "Option Shares") representing
approximately 19.9% of the shares of Premark Common Stock issued and
outstanding (without giving effect to the shares issued or issuable under
the Option) is exercisable only upon the occurrence of the conditions set
forth in the Stock Option Agreement described in Item 4. The Option may be
exercised at $34.06 per share. If the Option becomes exercisable and ITW
exercises the Option, ITW anticipates that it would fund the purchase with
working capital of ITW and commercial paper issued by ITW.
ITEM 4. PURPOSE OF THE TRANSACTION
On September 9, 1999, Premark, ITW and CS Merger Sub Inc., a
Delaware corporation and wholly owned subsidiary of ITW ("Merger Sub"),
entered into an Agreement and Plan of Merger (the "Merger Agreement"),
pursuant to which Merger Sub will merge with and into Premark (the
"Merger") with Premark continuing in existence as the surviving corporation
(the "Surviving Corporation") and a wholly owned subsidiary of ITW. Each
share of Premark Common Stock issued and outstanding at the effective time
of the Merger (other than shares of Premark Common Stock owned by ITW,
Premark or any direct or indirect subsidiary of ITW or Premark, which will
be canceled in the Merger) will be converted into between .5776 and .9181
shares of common stock of ITW, par value $0.01 per share, subject to
adjustment as provided in the Merger Agreement. All shares of Premark
Common Stock, when so converted, will no longer be outstanding and will
automatically be canceled and retired and will cease to exist. Each issued
and outstanding share of common stock of Merger Sub, par value $0.01 per
share, will be converted into one share of common stock of the Surviving
Corporation.
The closing of the Merger will occur on the second business day
after the date on which the last of the closing conditions to the Merger
contained in the Merger Agreement has been satisfied or waived or on such
other date as Premark and ITW may agree. The Merger is intended to qualify
as a reorganization for purposes of Section 368(a) of the Internal Revenue
Code of 1986, as amended, and for accounting and financial purposes as a
pooling of interests. The Merger is subject to a number of conditions set
forth in the Merger Agreement.
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Pursuant to the Merger Agreement, upon consummation of the Merger,
(i) the certificate of incorporation and bylaws of Merger Sub in effect
immediately prior to the effective time of the Merger will be the
certificate of incorporation and bylaws of the Surviving Corporation until
duly amended as provided therein or by applicable law; (ii) the directors
of Merger Sub at the effective time of the Merger will be the directors of
the Surviving Corporation; and (iii) the officers of Premark at the
effective time of the Merger will be the officers of the Surviving
Corporation.
The Merger Agreement provides that Premark may not take certain
actions prior to the effective time of the Merger, except as agreed to in
writing by ITW or as contemplated by the Merger Agreement, the Stock Option
Agreement, or as disclosed or as required by applicable law, including the
declaration, setting aside or payment of any dividend payable in cash,
stock or property in respect of any capital stock, other than regular
quarterly dividends not in excess of $0.11 per share of Premark Common
Stock. The Merger Agreement also provides that, prior to the closing, the
record date for determining shareholders who are entitled to receive
Premark's regular quarterly dividends will be the close of business on the
day on which ITW's then current fiscal quarter ends.
Pursuant to the Merger Agreement, Premark must pay ITW a fee of $75
million in cash (the "Termination Fee") if the Merger Agreement is
terminated:
(i) (x) by either ITW or Premark following completion of the
Premark stockholders meeting held to consider the Merger Agreement on the
basis that Premark's stockholders have not adopted the Merger Agreement,
and (y) an Acquisition Proposal (as defined in the Merger Agreement) has
been publicly announced and not withdrawn prior to the Premark stockholders
meeting, and (z) Premark's board of directors has withdrawn or materially
modified, in a manner adverse to ITW, the board's approval or
recommendation of the Merger Agreement or the Merger;
(ii) by ITW on the basis that Premark's board of directors has
withdrawn, materially modified, in a manner adverse to ITW, or changed, in
a manner adverse to ITW, its approval or recommendation of the Merger
Agreement or the Merger, to such an extent that Premark's board of
directors is no longer approving or recommending the Merger Agreement or
the Merger;
(iii) (x) by either ITW or Premark following completion of the
Premark stockholders meeting held to consider the Merger Agreement on the
basis that Premark's stockholders have not adopted the Merger Agreement,
and (y) an Acquisition Proposal has been publicly announced and not
withdrawn prior to the Premark stockholders meeting, and (z) within one
year after such termination, Premark enters into a definitive agreement
with respect to an Acquisition Proposal or an Acquisition Proposal is
consummated with any person; or
(iv) by Premark at any time prior to the adoption of the Merger
Agreement by Premark's stockholders, by reason of a Superior Proposal (as
defined below), but only if Premark has provided ITW notice and a copy of
such proposal and four business days' notice of Premark's intent to enter
into a binding agreement with respect to such proposal and, during such
four business day period, Premark has considered any adjustment in the
terms and conditions of the Merger Agreement that ITW may propose. A
"Superior Proposal" is an Acquisition Proposal that the Premark board of
directors concludes in good faith (after consultation with its outside
legal counsel and its financial advisor) is reasonably capable of being
completed, and would, if consummated, result in a transaction more
favorable to Premark's stockholders than the Merger.
As an inducement and condition to ITW's and Merger Sub's
willingness to enter into the Merger Agreement, Premark entered into a
Stock Option Agreement with ITW, dated as of September 9, 1999 (the "Stock
Option Agreement"), whereby Premark granted ITW an option to purchase up to
12,203,694, shares of Premark Common Stock, or such number of shares of
Premark Common Stock as represents 19.9% of the then
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outstanding shares of Premark Common Stock (without giving effect to the
shares issued or issuable under the Option), at a price per share of
$34.06, subject to adjustment as described in the Stock Option Agreement.
The Option is exercisable within 135 days following the occurrence
of any event entitling ITW to receive the Termination Fee under the Merger
Agreement (a "Triggering Event"), unless prior to the Triggering Event, the
effective time of the Merger has occurred or the Option has expired. The
Option expires upon either (i) the effective time of the Merger or (ii) the
close of business on the earlier of (x) 135 days after the date that ITW
becomes entitled to receive the Termination Fee under the Merger Agreement
and (y) the date that ITW is no longer potentially entitled to receive the
Termination Fee under the Merger Agreement for a reason other than that ITW
has already received the Termination Fee.
The Stock Option Agreement provides that ITW may require Premark,
within 135 days after the occurrence of a Triggering Event, to (i)
repurchase the Option at a price equal to (w) the number of shares of
Common Stock then purchasable upon exercise of the Option (or a lesser
number requested by ITW) multiplied by (x) the amount by which the
market/offer price exceeds $34.06 and (ii) repurchase the number of shares
of Premark Common Stock acquired by ITW pursuant to the Option that ITW
designates at a price equal to (y) the number of shares designated by ITW
multiplied by (z) the market/offer price. The market/offer price is the
highest of (i) the price per share of Premark Common Stock at which a
tender or exchange offer for Premark Common Stock has been made during the
term of the Option, (ii) the price per share of Premark Common Stock to be
paid by any third party pursuant to an agreement with Premark with respect
to a business combination transaction, and (iii) the highest trading price
for a share of Premark Common Stock on the New York Stock Exchange within
the six month period immediately preceding the date of ITW's delivery to
Premark of its repurchase request.
To the extent ITW does not exercise its rights described in the
preceding paragraph, Premark has the right, within 135 days after the
expiration of ITW's rights described in the preceding paragraph, to
repurchase from ITW, and ITW shall sell, three-quarters (but not less than
three-quarters) of the shares of Premark Common Stock acquired by ITW
pursuant to the Stock Option Agreement and then owned by ITW at a price per
share equal to the greater of (i) the market/offer price and (ii) $34.06
per share for the shares acquired.
The Stock Option Agreement limits the amount of total profit that
ITW may receive from the Option to an aggregate of $30 million.
The preceding are summaries of certain principal terms of the
Merger Agreement and the Stock Option Agreement and do not purport to be
complete. Reference is made to the full text of such agreements which are
filed as exhibits to this statement and are incorporated in this Schedule
13D by this reference. The full text of the joint press release filed as an
exhibit to this statement is also incorporated in this Schedule 13D by this
reference.
Except as set forth in this Item 4 or as provided in the Merger
Agreement or the Stock Option Agreement or as otherwise referred to or
described in this Schedule 13D, ITW has no present plan or proposal which
relates to or would result in any of the matters referred to in Items (a)
through (j) of Item 4 of Schedule 13D.
ITEM 5. INTEREST IN SECURITIES OF THE ISSUER
(a) - (b) By reason of its execution of the Stock Option Agreement,
ITW may be deemed to beneficially own 12,203,694 shares, or approximately
16.6% of the Premark Common Stock outstanding after giving effect to the
issuance of shares of Premark Common Stock upon exercise of the Option.
However, ITW disclaims beneficial ownership of shares of Premark Common
Stock which are purchasable by ITW upon exercise of the Option on the
grounds that the Option is not currently exercisable and only becomes
exercisable upon the occurrence of the events set forth in the Stock Option
Agreement, none of which has occurred. Subject to the limitations set forth
in the Stock Option Agreement, if the Option becomes exercisable and ITW
exercises the
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Option, ITW would have the sole right to vote and to dispose of the shares
of Premark Common Stock acquired as a result of such exercise.
W. James Farrell, the Chairman and Chief Executive Officer of ITW
and a Director of Premark, owns 1,446 shares of Premark Common Stock and an
option to purchase 750 shares of Premark Common Stock.
(c) Other than the execution of the Stock Option Agreement on
September 9, 1999, none of ITW or, to ITW's knowledge, any of the persons
named on Schedule 1 have effected any transactions in Premark Common Stock
in the past 60 days.
(d) - (e) Not applicable.
ITEM 6. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH
RESPECT TO SECURITIES OF THE ISSUER
Reference is made to Item 4 above.
Except as provided in the Merger Agreement, the Stock Option
Agreement and as otherwise referred to or described in this Schedule 13D,
to ITW's knowledge, there are no contracts, arrangements, understandings or
relationships (legal or otherwise) between ITW and Premark or any other
person with respect to any securities of Premark.
ITEM 7. MATERIAL TO BE FILED AS EXHIBITS.
Exhibit No. Description
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99(a)(1) Agreement and Plan of Merger dated as of September 9, 1999, among
Premark, ITW and Merger Sub (incorporated by reference to Exhibit
2.1 to the Current Report on Form 8-K/A filed by Premark on
September 14, 1999).
99(a)(2) Stock Option Agreement dated as of September 9, 1999, between
Premark and ITW (incorporated by reference to Exhibit 99.1 to the
Current Report on Form 8-K filed by Premark on
September 13, 1999).
99(a)(3) Text of Joint Press Release dated September 9, 1999, issued by
Premark and ITW (incorporated by reference to Exhibit 99.3 to the
Current Report on Form 8-K filed by Premark on
September 13, 1999).
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SCHEDULE 1
Information Concerning Executive Officers and
Directors of Illinois Tool Works Inc.
The current executive officers and directors of Illinois Tool Works
Inc. ("ITW") are listed below. The address of ITW is: Illinois Tool Works
Inc., 3600 West Lake Avenue, Glenview, Illinois 60025. Unless otherwise
indicated, the business address listed for each individual not principally
employed by ITW is also the address of the corporation or other
organization which principally employs that individual.
NAME PRESENT POSITION WITH ITW CITIZENSHIP
CORPORATE OFFICERS
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Thomas W. Buckman Vice President, Patents and Technology USA
W. James Farrell Chairman and Chief Executive Officer USA
Russell M. Flaum Executive Vice President USA
Thomas J. Hansen Executive Vice President USA
Stewart S. Hudnut Senior Vice President, General Counsel USA
and Secretary
John Karpan Senior Vice President, Human Resources USA
Jon C. Kinney Senior Vice President and Chief Financial USA
Officer
Dennis J. Martin Executive Vice President USA
Frank S. Ptak Vice Chairman USA
F. Ronald Seager Executive Vice President USA
Harold B. Smith Chairman of the Executive Committee USA
David B. Speer Executive Vice President USA
Allan C. Sutherland Senior Vice President USA
Hugh J. Zentmeyer Executive Vice President USA
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POSITION/PRESENT PRINCIPAL
OCCUPATION OR EMPLOYMENT AND
NAME BUSINESS ADDRESS CITIZENSHIP
DIRECTORS
William F. Aldinger III Chairman and Chief Executive Officer USA
Household International, Inc.
2700 Sanders Road
Prospect Heights, Illinois 60070
Michael J. Birck President and Chief Executive Officer USA
Tellabs, Inc.
4951 Indiana Avenue
Lisle, Illinois 60532
Marvin D. Brailsford Vice President USA
Kaiser-Hill Company, LLC
10828 State Highway 93
Golden, Colorado 80402
Susan Crown Vice President USA
Henry Crown and Company
222 North LaSalle Street
Chicago, Illinois 60601
H. Richard Crowther Director of ITW USA
W. James Farrell Chairman and Chief Executive Officer of ITW USA
Robert C. McCormack Partner USA
Trident Capital, L.P.
190 South LaSalle Street
Chicago, Illinois 60603
Phillip B. Rooney Vice Chairman USA
ServiceMaster Company
One ServiceMaster Way
Downers Grove, Illinois 60515
Harold B. Smith Chairman of the Executive Committee of ITW USA
Ormand J. Wade Director of ITW USA
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SIGNATURE
After reasonable 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.
Dated: September 20, 1999
ILLINOIS TOOL WORKS INC.
By: /s/ Stewart S. Hudnut
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Name: Stewart S. Hudnut
Title: Senior Vice President, General Counsel and
Secretary
