SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________
SCHEDULE 14D-1
Tender Offer Statement
Pursuant to Section 14(d)(1) of the Securities Exchange Act of 1934
__________________
Clark Equipment Company
(Name of Subject Company)
CEC Acquisition Corp.
Ingersoll-Rand Company
(Bidder)
Common Stock, $7.50 par value per share
(Title of Class of Securities)
18139610
(CUSIP Number of Class of Securities)
Patricia Nachtigal, Esq.
Vice President and General Counsel
Ingersoll-Rand Company
World Headquarters
200 Chestnut Ridge Road
Woodcliff Lake, New Jersey 07675
Telephone: (201) 573-0123
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidder)
Copy to:
Robert L. Friedman, Esq.
Simpson Thacher & Bartlett
425 Lexington Avenue
New York, New York 10017
Telephone: (212) 455-2000
CALCULATION OF FILING FEE
Transaction Valuation* Amount of Filing Fee**
$1,319,813,418.00 $263,963.00
* Based on the offer to purchase all of the outstanding shares of Common
Stock of the Subject Company and the associated Preferred Stock Purchase
Rights at $77.00 cash per share, the number of Shares outstanding as
reported as of March 13, 1995 in the 1995 Proxy Statement of the Subject
Company and the number of options outstanding as of December 31, 1994 as
reported in the Annual Report to Stockholders of the Subject Company for
the year ended December 31, 1994.
** 1/50 of 1% of Transaction Valuation.
/ / Check 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:
Form or Registration No.:
Filing Party:
Date Filed:
<PAGE>
2
This Tender Offer Statement on Schedule 14D-1 relates
to the offer by CEC Acquisition Corp., a Delaware corporation
(the "Purchaser") and a wholly owned subsidiary of Ingersoll-Rand
Company, a New Jersey corporation (the "Parent"), to purchase all
of the outstanding shares of Common Stock, $7.50 par value per
share (the "Shares"), of Clark Equipment Company, a Delaware
corporation (the "Company"), and (unless and until the Purchaser
declares that the Rights Condition as defined in the Offer to
Purchase referred to below is satisfied) the associated Preferred
Stock Purchase Rights (the "Rights") issued pursuant to the
Rights Agreement dated as of March 10, 1987, as amended and
restated as of August 14, 1990, between the Company and Harris
Trust and Savings Bank, as Rights Agent, at a purchase price of
$77.00 per Share (and associated Right), 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 April 3, 1995
(the "Offer to Purchase"), a copy of which is attached hereto as
Exhibit (a)(1), and in the related Letter of Transmittal (which,
together with the Offer to Purchase, constitute the "Offer"), a
copy of which is attached hereto as Exhibit (a)(2).
Item 1. Security and Subject Company.
(a) The name of the subject company is Clark Equipment
Company. The information set forth in Section 7 ("Certain
Information Concerning the Company") of the Offer to Purchase is
incorporated herein by reference.
(b) The exact title of the class of equity securities
being sought in the Offer is Common Stock, $7.50 par value per
share, including the associated Preferred Stock Purchase Rights,
of the Company. The information set forth in the Introduction
(the "Introduction") of the Offer to Purchase is incorporated
herein by reference.
(c) The information set forth in Section 6 ("Price
Range of Shares; Dividends") of the Offer to Purchase is
incorporated herein by reference.
Item 2. Identity and Background.
(a)-(d) and (g) This Statement is filed by the
Purchaser and the Parent. The information set forth in Section 8
("Certain Information Concerning the Purchaser and the Parent")
of the Offer to Purchase and in Schedule I thereto is
incorporated herein by reference.
(e) and (f) During the last five years, neither the
Purchaser nor the Parent nor, to the best knowledge of the
Purchaser or the Parent, any of the persons listed in Schedule I
to the Offer to Purchase (i) has been convicted in a criminal
proceeding (excluding traffic violations or similar misdemeanors)
or (ii) was 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 activities
subject to, federal or state securities laws or finding any
violation of such laws.
Item 3. Past Contacts, Transactions or Negotiations with the
Subject Company.
(a) The information set forth in Section 8 ("Certain
Information Concerning the Purchaser and the Parent") of the
Offer to Purchase is incorporated herein by reference. Except as
set forth in Section 8 of the Offer to Purchase, since January 1,
1992, there have been no transactions which would be required to
be disclosed under this Item 3(a) between either the Purchaser or
the Parent or, to the best knowledge of the Purchaser and the
Parent, any of the persons listed in Schedule I to the Offer to
Purchase and the Company or any of its executive officers,
directors or affiliates.
(b) The information set forth in Section 8 ("Certain
Information Concerning the Purchaser and the Parent") and Section
10 ("Background of the Offer; Contacts with the Company") of the
Offer to Purchase is incorporated herein by reference. Except as
set forth in Section 8 and Section 10 of the Offer to Purchase,
since January 1, 1992, there have been no contacts, negotiations
or transactions which would be required to be disclosed under
Item 3(b) between either the Purchaser or the Parent or any of
their respective subsidiaries or, to the best knowledge of the
Purchaser and the Parent, any of those persons listed in Schedule
<PAGE>
3
I to the Offer to Purchase and the Company or its affiliates
concerning a merger, consolidation or acquisition, a tender offer
or other acquisition of securities, an election of directors or a
sale or other transfer of a material amount of assets.
Item 4. Source and Amount of Funds or Other Consideration.
(a) and (b) The information set forth in Section 9
("Source and Amount of Funds") of the Offer to Purchase is
incorporated herein by reference.
(c) Not applicable.
Item 5. Purpose of the Tender Offer and Plans or Proposals of
the Bidder.
(a)-(g) The information set forth in the
Introduction, Section 10 ("Background of the Offer; Contacts with
the Company"), Section 11 ("Purpose of the Offer; the Merger;
Plans for the Company"), Section 12 ("Dividends and
Distributions") and Section 13 ("Effect of the Offer on the
Market for the Shares, Stock Exchange Listing and Exchange Act
Registration") of the Offer to Purchase is incorporated herein by
reference.
Item 6. Interest in Securities of the Subject Company.
(a) The information set forth in the Introduction and
Section 8 ("Certain Information Concerning the Purchaser and the
Parent") of and Schedules I and II to the Offer to Purchase is
incorporated herein by reference. Except as set forth in the
Introduction and Section 8 of and Schedules I and II to the Offer
to Purchase, neither the Purchaser nor the Parent nor, to the
best knowledge of the Purchaser or the Parent, any of the persons
listed in Schedule I to the Offer to Purchase or any associate or
majority-owned subsidiary of either the Purchaser or the Parent
or any of the persons so listed beneficially owns or has any
right to acquire, directly or indirectly, any Shares.
(b) The information set forth in the Introduction and
Section 8 ("Certain Information Concerning the Purchaser and the
Parent") of and Schedules I and II to the Offer to Purchase is
incorporated herein by reference. Except as set forth in the
Introduction and Section 8 of and Schedules I and II to the Offer
to Purchase, neither the Purchaser nor the Parent nor, to the
best knowledge of the Purchaser or the Parent, any of the persons
or entities referred to above or any executive officer, director
or subsidiary of any of the foregoing has effected any
transactions in the Shares during the past sixty days.
Item 7. Contracts, Arrangements, Understandings or
Relationships with Respect to the Subject Company's
Securities.
The information set forth in the Introduction, Section
8 ("Certain Information Concerning the Purchaser and the
Parent"), Section 9 ("Source and Amount of Funds"), Section 10
("Background of the Offer; Contacts with the Company"), Section
11 ("Purpose of the Offer; the Merger; Plans for the Company")
and Section 16 ("Fees and Expenses") of the Offer to Purchase is
incorporated herein by reference. Except as set forth in the
Introduction and Sections 8, 9, 10, 11 and 16 of the Offer to
Purchase, neither the Purchaser nor the Parent, nor, to the best
knowledge of the Purchaser or the Parent, any of the persons
listed in Schedule I to the 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 the voting of any such
securities, joint ventures, loans or option arrangements, puts or
calls, guarantees of loans, guarantee agreements or any giving or
withholding of proxies).
Item 8. Persons Retained, Employed or to be Compensated.
The information set forth in the Introduction and
Section 16 ("Fees and Expenses") of the Offer to Purchase is
incorporated herein by reference.
<PAGE>
4
Item 9. Financial Statements of Certain Bidders.
The information set forth in Section 8 ("Certain
Information Concerning the Purchaser and the Parent") of the
Offer to Purchase is incorporated herein by reference.
Item 10. Additional Information.
(a) None.
(b) and (c) The information set forth in the
Introduction, Section 11 ("Purpose of the Offer; the Merger;
Plans for the Company") and Section 15 ("Certain Legal Matters
and Regulatory Approvals") of the Offer to Purchase is
incorporated herein by reference.
(d) The information set forth in Section 9 ("Source
and Amount of Funds") and Section 15 ("Certain Legal Matters and
Regulatory Approvals") of the Offer to Purchase is incorporated
herein by reference.
(e) The information set forth in Section 10
("Background of the Offer; Contacts with the Company") and
Section 15 ("Certain Legal Matters and Regulatory Approvals") of
the Offer to Purchase is incorporated herein by reference.
(f) The information set forth in the Offer to Purchase
and the Letter of Transmittal is incorporated herein by
reference.
Item 11. Material to be Filed as Exhibits.
(a) (1) Offer to Purchase dated April 3, 1995.
(a) (2) Letter of Transmittal.
(a) (3) Notice of Guaranteed Delivery.
(a) (4) Letter from the Dealer Manager to Brokers,
Dealers, Commercial Banks, Trust Companies
and Nominees.
(a) (5) Letter to clients for use by Brokers,
Dealers, Commercial Banks, Trust Companies
and Nominees.
(a) (6) Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9.
(a) (7) Summary Advertisement as published on April
3, 1995.
(a) (8) Press Release issued by the Parent on April
3, 1995.
(b) (1) Commitment Letter dated March 31, 1995 to the
Parent from The Chase Manhattan Bank
(National Association).
(c) Not applicable.
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
<PAGE>
5
(g) Complaint in Clark Equipment Company v.
Ingersoll-Rand Company, U.S. District Court
for the Southern District of New York.
<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.
INGERSOLL-RAND COMPANY
By: /s/ James E. Perrella
---------------------------------
Name: James E. Perrella
Title: Chairman, President and
Chief Executive Officer
CEC ACQUISITION CORP.
By: s/ Patricia Nachtigal
---------------------------------
Name: Patricia Nachtigal
Title: Vice President and
Assistant Secretary
Date: April 3, 1995
<PAGE>
EXHIBIT INDEX
Exhibit Page
No. Description No.
------- ----------- ----
11(a)(1) Offer to Purchase dated April 3, 1995 . . . . . .
11(a)(2) Letter of Transmittal . . . . . . . . . . . . . .
11(a)(3) Notice of Guaranteed Delivery . . . . . . . . . .
11(a)(4) Letter from the Dealer Manager to Brokers,
Dealers, Commercial Banks, Trust Companies and
Nominees . . . . . . . . . . . . . . . . . . . .
11(a)(5) Letter to clients for use by Brokers, Dealers,
Commercial Banks, Trust Companies and Nominees .
11(a)(6) Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 . .
11(a)(7) Summary Advertisement as published on April 3,
1995 . . . . . . . . . . . . . . . . . . . . . .
11(a)(8) Press Release issued by the Parent on April 3,
1995 . . . . . . . . . . . . . . . . . . . . . .
11(b)(1) Commitment Letter dated March 31, 1995 to the
Parent from The Chase Manhattan Bank (National
Association). . . . . . . . . . . . . . . . . .
11(g) Complaint in Clark Equipment Company v. Ingersoll-
Rand Company, U.S. District Court for the Southern
District of New York . . . . . . . . . . . . . .
<PAGE>
EXHIBIT 11(a)(1)
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
OF
CLARK EQUIPMENT COMPANY
AT
$77.00 NET PER SHARE
BY
CEC ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
INGERSOLL-RAND COMPANY
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON FRIDAY, APRIL 28, 1995, UNLESS THE OFFER IS EXTENDED.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS: (1) THERE BEING VALIDLY
TENDERED AND NOT PROPERLY WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A
NUMBER OF SHARES OF COMMON STOCK OF THE COMPANY WHICH CONSTITUTES AT LEAST 51%
OF THE VOTING POWER (DETERMINED ON A FULLY DILUTED BASIS) ON THE DATE OF
PURCHASE OF ALL SECURITIES OF THE COMPANY ENTITLED TO VOTE GENERALLY IN THE
ELECTION OF DIRECTORS OR IN A MERGER; (2) THE PURCHASER BEING SATISFIED, IN ITS
SOLE DISCRETION, THAT THE SUPERMAJORITY STOCKHOLDER VOTE SPECIFIED IN THE
SUPERMAJORITY VOTING PROVISIONS CONTAINED IN THE COMPANY'S RESTATED CERTIFICATE
OF INCORPORATION WOULD NOT (AS A RESULT OF ACTION BY THE COMPANY'S BOARD OF
DIRECTORS OR OTHERWISE) BE REQUIRED PRIOR TO THE CONSUMMATION OF THE PROPOSED
MERGER DESCRIBED HEREIN OR THAT THE PURCHASER WILL ACQUIRE A SUFFICIENT NUMBER
OF SHARES TO INSURE A VOTE IN FAVOR OF SUCH PROPOSED MERGER UNDER SUCH
PROVISIONS; (3) THE COMPANY'S PREFERRED STOCK PURCHASE RIGHTS HAVING BEEN
REDEEMED BY THE COMPANY'S BOARD OF DIRECTORS OR THE PURCHASER BEING SATISFIED,
IN ITS SOLE DISCRETION, THAT SUCH PREFERRED STOCK PURCHASE RIGHTS HAVE BEEN
INVALIDATED OR ARE OTHERWISE INAPPLICABLE TO, OR THAT THE DILUTIVE PROVISIONS
THEREOF WOULD NOT BE TRIGGERED BY, THE OFFER AND THE PROPOSED MERGER DESCRIBED
HEREIN; AND (4) THE PURCHASER BEING SATISFIED, IN ITS SOLE DISCRETION, THAT THE
RESTRICTIONS ON BUSINESS COMBINATIONS CONTAINED IN SECTION 203 OF THE DELAWARE
GENERAL CORPORATION LAW WOULD NOT APPLY TO THE PURCHASER OR THE PARENT IN
CONNECTION WITH THE OFFER OR THE PROPOSED MERGER (AS A RESULT OF ACTION BY THE
COMPANY'S BOARD OF DIRECTORS, THE OWNERSHIP BY THE PURCHASER UPON CONSUMMATION
OF THE OFFER OF AT LEAST 85% OF THE OUTSTANDING VOTING STOCK OF THE COMPANY
(OTHER THAN SHARES HELD BY DIRECTORS WHO ARE ALSO OFFICERS AND CERTAIN EMPLOYEE
STOCK PLANS OF THE COMPANY) OR OTHERWISE). THE OFFER IS ALSO SUBJECT TO OTHER
TERMS AND CONDITIONS. SEE THE INTRODUCTION AND SECTIONS 1 AND 14.
THE DEALER MANAGER FOR THE OFFER IS:
MERRILL LYNCH & CO.
April 3, 1995 (Continued on next page)
<PAGE>
(Continued from previous page)
IMPORTANT
Any stockholder desiring to tender all or any portion of such stockholder's
shares of Common Stock, $7.50 par value per share (the "Shares"), and the
associated Preferred Stock Purchase Rights (the "Rights"), of the Company should
either (1) complete and sign the Letter of Transmittal (or a facsimile thereof)
in accordance with the instructions in the Letter of Transmittal, mail or
deliver the Letter of Transmittal (or such facsimile) and any other required
documents to the Depositary (as defined herein), and either deliver the
certificates representing the tendered Shares and, if separate, the certificates
representing the associated Rights and any other required documents to the
Depositary or tender such Shares (and Rights, if applicable) pursuant to 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 such stockholder. Stockholders having Shares (and
Rights, if applicable) registered in the name of a broker, dealer, commercial
bank, trust company or other nominee must contact such broker, dealer,
commercial bank, trust company or other nominee if they desire to tender Shares
(and Rights, if applicable) so registered. Unless and until the Purchaser
declares that the Rights Condition (as defined herein) is satisfied, holders of
Shares will be required to tender one Right for each Share tendered in order to
effect a valid tender of such Share.
A stockholder who desires to tender Shares and Rights and whose certificates
representing such Shares (and Rights, if applicable) are not immediately
available, or who cannot comply with the procedure for book-entry transfer on a
timely basis, may tender such Shares (and Rights, if applicable) by following
the procedures for guaranteed delivery set forth in Section 3.
Questions and requests for assistance may be directed to Merrill Lynch,
Pierce, Fenner & Smith Incorporated (the "Dealer Manager") or to Georgeson &
Company Inc. (the "Information Agent") at their respective addresses and
telephone numbers set forth on the back cover of this Offer to Purchase.
Additional copies of this Offer to Purchase, the Letter of Transmittal and the
Notice of Guaranteed Delivery may also be obtained from the Information Agent or
from brokers, dealers, commercial banks or trust companies.
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<C> <S> <C>
INTRODUCTION............................................................................ 1
THE TENDER OFFER........................................................................ 7
1. Term of the Offer; Expiration Date........................................ 7
2. Acceptance for Payment and Payment for Shares............................. 8
3. Procedure for Tendering Shares and Rights................................. 10
4. Withdrawal Rights......................................................... 13
5. Certain Federal Income Tax Consequences................................... 14
6. Price Range of Shares; Dividends.......................................... 15
7. Certain Information Concerning the Company................................ 16
8. Certain Information Concerning the Purchaser and the Parent............... 18
9. Source and Amount of Funds................................................ 20
10. Background of the Offer; Contacts with the Company........................ 22
11. Purpose of the Offer; the Merger; Plans for the Company................... 29
12. Dividends and Distributions............................................... 36
13. Effect of the Offer on the Market for the Shares, Stock Exchange Listing
and Exchange Act Registration........................................... 36
14. Certain Conditions of the Offer........................................... 37
15. Certain Legal Matters and Regulatory Approvals............................ 42
16. Fees and Expenses......................................................... 45
17. Miscellaneous............................................................. 46
Schedule I Directors and Executive Officers of the Purchaser and the Parent
Schedule II Parent Purchases of Shares
</TABLE>
i
<PAGE>
To: The Stockholders of
CLARK EQUIPMENT COMPANY
INTRODUCTION
CEC Acquisition Corp., a Delaware corporation (the "Purchaser") and a wholly
owned subsidiary of Ingersoll-Rand Company, a New Jersey corporation (the
"Parent"), hereby offers to purchase all of the outstanding shares of Common
Stock, $7.50 par value per share (the "Shares"), of Clark Equipment Company, a
Delaware corporation (the "Company"), and (unless and until the Purchaser
declares that the Rights Condition (as defined below) is satisfied) the
associated Preferred Stock Purchase Rights (the "Rights") issued pursuant to the
Rights Agreement, dated as of March 10, 1987, as amended and restated as of
August 14, 1990 (as so amended and restated, the "Rights Agreement"), between
the Company and Harris Trust and Savings Bank, as Rights Agent (the "Rights
Agent"), at a purchase price of $77.00 per Share (and associated Right), net to
the seller in cash without interest thereon, upon the terms and subject to the
conditions set forth in this Offer to Purchase and in the related Letter of
Transmittal (which together constitute the "Offer"). Unless the context requires
otherwise, all references in this Offer to Purchase to "Shares" shall be deemed
to refer also to the associated Rights, and all references to "Rights" shall be
deemed to include all benefits that may inure to the stockholders of the Company
or to holders of the Rights pursuant to the Rights Agreement. Based on publicly
available information, the Purchaser believes that one Right is currently
associated with each Share.
Tendering stockholders will not be obligated to pay brokerage fees or
commissions or, subject to Instruction 6 of the Letter of Transmittal, stock
transfer taxes on the transfer and sale of Shares and Rights pursuant to the
Offer. The Purchaser will pay all fees and expenses of Merrill Lynch, Pierce,
Fenner & Smith Incorporated, which is acting as Dealer Manager for the Offer (in
such capacity, the "Dealer Manager"), The Bank of New York (the "Depositary")
and Georgeson & Company Inc. (the "Information Agent") incurred in connection
with the Offer. See Section 16.
The purpose of the Offer is to acquire control of, and the entire equity
interest in, the Company. The Purchaser intends to propose, and to seek to have
the Company consummate as soon as practicable after consummation of the Offer, a
merger or similar business combination (the "Merger") with the Purchaser or
another direct or indirect subsidiary of the Parent, pursuant to which each then
outstanding Share (other than Shares held by the Parent, the Purchaser or any
other wholly owned subsidiary of the Parent, Shares held in the treasury of the
Company and Shares held by stockholders who properly exercise appraisal rights
under Delaware law) would be converted into the right to receive in cash the
price per Share paid by the Purchaser pursuant to the Offer.
Although the Purchaser will seek to have the Company consummate the Merger
as soon as practicable after consummation of the Offer, if the Board of
Directors of the Company opposes the Offer and the Merger, certain terms of the
Rights and certain provisions of the Delaware General Corporation Law (the
"DGCL") and the Company's Restated Certificate of Incorporation (the "Charter")
and By-Laws (the "By-Laws") may affect the ability of the Purchaser to obtain
control of the Company and to effect the Merger. Accordingly, the timing and
details of the Merger will depend on a variety of factors and legal
requirements, the actions of the Board of Directors of the Company, the number
of Shares acquired by the Purchaser pursuant to the Offer, and whether the
Minimum Condition, the Supermajority Charter Condition, the Rights Condition and
the Delaware Takeover Statute Condition (each as defined below) are satisfied.
On April 3, 1995, the Parent delivered a notice to the Company nominating
seven individuals for election as directors at the Company's annual meeting of
stockholders scheduled for May 9, 1995. The Parent intends to solicit proxies
from stockholders for the purpose of electing the seven director
1
<PAGE>
candidates nominated by the Parent in order to insure that the new Board of
Directors will take all such actions necessary or appropriate (subject to such
directors' fiduciary duties) to approve and effectuate the consummation of the
Offer and the Merger, including taking action to execute an agreement and plan
of merger and to satisfy the Supermajority Charter Condition, the Rights
Condition and the Delaware Takeover Statute Condition. If the seven director
candidates nominated by the Parent are not elected at the annual meeting and the
conditions to the Offer are not otherwise satisfied, the Parent will explore the
other options available to it, including soliciting stockholder demands to call
a special meeting of the Company's stockholders for the purpose of electing
candidates nominated by the Parent as directors of the Company, adopting
resolutions of stockholders instructing the Board of Directors of the Company to
approve the Offer and the Merger or taking other actions to insure that the
Offer and the Merger will be consummated. Under the Charter and By-Laws, the
Company is required to call a special meeting of the stockholders upon the
demand of the holders of a majority of the outstanding Shares.
THIS OFFER TO PURCHASE DOES NOT CONSTITUTE A SOLICITATION OF A PROXY,
CONSENT OR AUTHORIZATION FOR OR WITH RESPECT TO THE ANNUAL MEETING OR ANY
SPECIAL MEETING OF THE COMPANY'S STOCKHOLDERS OR ANY ACTION IN LIEU THEREOF. ANY
SUCH SOLICITATION WHICH THE PURCHASER MAY MAKE WILL BE MADE ONLY PURSUANT TO
SEPARATE PROXY MATERIALS IN COMPLIANCE WITH THE REQUIREMENTS OF SECTION 14(A) OF
THE SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT").
Upon consummation of the Offer, assuming the Minimum Condition, the
Supermajority Charter Condition, the Rights Condition, the Delaware Takeover
Statute Condition and the other conditions to the Offer set forth in Section 14
are satisfied, the Purchaser will own sufficient Shares, subject to the
procedures described in Section 11, ultimately to remove and/or replace the
Company's Board of Directors and to approve the Merger without the vote of any
other stockholder. For a discussion of certain appraisal rights available to
stockholders upon consummation of the Merger, see Section 11.
THE OFFER IS CONDITIONED, AMONG OTHER THINGS, UPON SATISFACTION, IN THE
PURCHASER'S SOLE DISCRETION, OF THE FOLLOWING CONDITIONS: (1) THE MINIMUM
CONDITION, (2) THE SUPERMAJORITY CHARTER CONDITION, (3) THE RIGHTS CONDITION AND
(4) THE DELAWARE TAKEOVER STATUTE CONDITION, EACH OF WHICH IS DESCRIBED BELOW.
CERTAIN OTHER CONDITIONS TO THE OFFER ARE DESCRIBED IN SECTION 14.
The Minimum Condition. The Offer is subject to the condition (the "Minimum
Condition") that there shall have been validly tendered and not properly
withdrawn on or prior to the Expiration Date (as defined below) a number of
Shares which, together with the Shares owned by the Parent, constitutes at least
51% of the voting power (determined on a fully diluted basis) on the date of
purchase of all securities of the Company entitled to vote generally in the
election of directors or in a merger.
According to the Company's 1995 Proxy Statement (the "1995 Proxy
Statement"), 17,132,696 Shares were outstanding at March 13, 1995. According to
the Company's Annual Report to Stockholders for the fiscal year ended December
31, 1994 (the "1994 Annual Report"), options covering a total of 7,738 Shares
were outstanding under the Company's various stock option plans at December 31,
1994. The Parent currently beneficially owns an aggregate of 274,200 Shares,
representing approximately 1.6% of the Shares outstanding based on the number of
Shares reported by the Company as outstanding at March 13, 1995. See Section 8.
Based on this information, the Purchaser believes that the Minimum Condition
will be satisfied if approximately 8,463,475 Shares are validly tendered
pursuant to the Offer and not properly withdrawn.
According to a Current Report on Form 8-K filed by the Company on February
3, 1995, the Company has been authorized by the Board of Directors to repurchase
up to 3,000,000 of its Shares (the "Company Repurchase Plan"). There has been no
public announcement by the Company as to how many Shares it has repurchased
under the Company Repurchase Plan, if any. If the Company were to have
repurchased Shares after March 13, 1995, the number of Shares that would have to
be tendered to satisfy the Minimum Condition would be correspondingly reduced.
The Purchaser will make a
2
<PAGE>
determination as to whether the Minimum Condition has been satisfied based on
the best information available to it at the time of determination.
If, upon consummation of the Offer, the Purchaser and the Parent together
own at least 51% of the outstanding Shares (determined on a fully diluted
basis), then the Purchaser and the Parent will own sufficient Shares to enable
them to effect stockholder approval of the Merger (subject to the requirements
of the Supermajority Charter Provision and the Delaware Takeover Statute
described below).
The Supermajority Charter Condition. The Offer is subject to the condition
(the "Supermajority Charter Condition") that the Purchaser shall be satisfied,
in its sole discretion, that the supermajority stockholder vote specified in the
Supermajority Charter Provision (as defined below) would not (as a result of
action by the Company's Board of Directors or otherwise) be required prior to
the consummation of the Merger or that the Purchaser will acquire a sufficient
number of Shares to insure a vote in favor of the Merger under such provision.
The Charter provides that in addition to any affirmative vote required by
applicable law (currently the affirmative vote of holders of at least a majority
of the outstanding Shares), the affirmative vote of the holders of at least 80%
of the outstanding Shares is required to approve certain business combinations
(including the Merger) between the Company and a person who or which, together
with its affiliates and associates and persons with whom any of it, its
affiliates and associates have an agreement regarding any Shares, is the
beneficial owner of more than 10% of the outstanding Shares (an "Interested
Stockholder"), unless prior to such person becoming an Interested Stockholder
the Company's Board of Directors shall by resolution have approved a memorandum
of understanding or a letter of intent with respect to such business combination
(the "Supermajority Charter Provision").
The acquisition by the Purchaser in the Offer of a number of Shares which,
together with Shares held by the Parent, would be in excess of 10% of the
outstanding Shares would make the Purchaser and the Parent "Interested
Stockholders" for purposes of the Supermajority Charter Provision. As such, the
Purchaser and the Parent could be prohibited from consummating the Merger unless
(a) prior to the consummation of the Offer the Company's Board of Directors
approves by resolution a memorandum of understanding or a letter of intent with
respect to the Merger, (b) immediately following the consummation of the Offer
the Purchaser and the Parent own at least 80% of the outstanding Shares or (c)
the Merger is otherwise approved by the affirmative vote of the holders of at
least 80% of the outstanding Shares. See Section 11.
According to the Company's 1995 Proxy Statement, at December 31, 1994 (i)
certain employee benefit plans of the Company (the "Company Benefit Plans") held
an aggregate of 2,080,689 Shares and (ii) the directors and officers of the
Company held an aggregate of approximately 247,530 Shares (not including Shares
held through the Company Benefit Plans), for an aggregate of approximately
2,328,219 Shares, or 13.6% of the outstanding Shares. If the Company were to
have repurchased Shares under the Company Repurchase Plan, then the Company
Benefit Plans and the directors and officers of the Company would hold a
correspondingly greater percentage of the outstanding Shares. Based on publicly
available information, the Purchaser is unable to determine the number of Shares
out of the 2,080,689 Shares beneficially owned by the Company Benefit Plans (i)
that may be tendered in the Offer or voted for the Merger at the sole discretion
of employee participants thereof or (ii) that may be tendered in the Offer or
voted for the Merger at the sole discretion of the trustees thereof. However,
according to a Schedule 13G filed with the Securities and Exchange Commission
(the "Commission") on January 24, 1995 on behalf of the Company's leveraged
employee stock ownership plan (the "LESOP") (one of the Company Benefit Plans),
as of December 31, 1994 the LESOP held sole voting power as to 834,494 Shares,
shared voting power as to 1,219,502 Shares, sole dispositive power as to no
Shares and shared dispositive power as to 834,494 Shares. According to the
Company's 1995 Proxy Statement, at December 31, 1994 the LESOP held 2,053,996
Shares. Based on the above information, the Purchaser believes that participants
in the LESOP are entitled to voting rights with respect to, and entitled to
determine whether to tender, at least 1,219,502 Shares.
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The Purchaser is hereby requesting that the Company's Board of Directors
adopt a resolution approving a memorandum of understanding or a letter of intent
with respect to the Merger for purposes of the Supermajority Charter Provision.
The Purchaser believes that under the circumstances of the Offer and under
applicable law, the Board of Directors of the Company is obligated by its
fiduciary responsibilities to so approve the Merger in order to permit the Offer
and the Merger to be consummated. However, there can be no assurance that the
Board will do so. If the Board does not so approve the Merger but upon
consummation of the Offer the Purchaser and the Parent together own at least 80%
of the outstanding Shares, then the Purchaser and the Parent would own
sufficient Shares to enable them to satisfy the Supermajority Charter Provision
and effect stockholder approval of the Merger (subject to the requirements of
the Delaware Takeover Statute described below). As indicated above, any action
by the Purchaser and the Parent to change the composition of the Board of
Directors would be intended to result in the reconstituted Board taking action
to approve the Merger in order to satisfy the Supermajority Charter Condition.
The Rights Condition. The Offer is subject to the condition (the "Rights
Condition") that the Rights shall have been redeemed by the Company's Board of
Directors or that the Purchaser shall be satisfied, in its sole discretion, that
such Rights have been invalidated or are otherwise inapplicable to, or the
dilutive provisions thereof will not be triggered by, the Offer and the Merger.
The Rights are described in the Company's Quarterly Report on Form 10-Q for the
quarter ended September 30, 1990 (the "September 1990 Form 10-Q"). The following
discussion is based on information contained in the September 1990 Form 10-Q. A
more detailed description of the Rights is contained in Section 11.
In the event that at any time following a Distribution Date (as defined in
Section 11) a person becomes the beneficial owner of 20% or more of the then
outstanding Shares (the "Ownership Flip-In"), each holder of a Right will
thereafter have the right to purchase, upon exercise thereof at a price subject
to adjustment of $80 per Right (the "Purchase Price"), a number of Shares which
have a market value of two times the Purchase Price. In the event that at any
time following the date (the "Stock Acquisition Date") of a public announcement
that a person, entity or group of affiliated or associated persons (an
"Acquiring Person") has acquired beneficial ownership of 20% or more of the
outstanding Shares, the Company is involved in a merger or other business
combination transaction in which it is not the continuing or surviving
corporation or in which any or all of the Shares are changed into or exchanged
for securities of another party or cash or other property or 50% or more of the
Company's assets or earning power is sold (the "Flip-Over"), each holder of a
Right will thereafter have the right to purchase, upon the exercise thereof at
the Purchase Price, common stock of the acquiring entity or parent thereof which
has a market value of two times the Purchase Price. Following an Ownership Flip-
In or Flip-Over, any Rights beneficially owned by an Acquiring Person or
affiliates or associates of any Acquiring Person will immediately become null
and void. The Purchaser believes that the consummation of the Offer likely would
trigger the Ownership Flip-In and as a result cause significant dilution to the
Purchaser's interest in the Company and render the Offer and the Merger
economically unattractive for the Purchaser. However, the Ownership Flip-In and
the Flip-Over would not be triggered if a majority of the non-officer directors
of the Company who are not affiliated with an Acquiring Person (the "Independent
Directors") determine, after receiving advice from one or more investment
banking firms, that the acquisition of Shares which would cause an Acquiring
Person to become such was pursuant to a tender or exchange offer for all
outstanding Shares at a price and on terms which such majority of Independent
Directors determines to be fair and otherwise in the best interests of the
Company and its stockholders.
At any time until 15 days following the Stock Acquisition Date, the Company
may redeem the Rights in whole, but not in part, at a price of $.05 per Right,
subject to adjustment. Until the Distribution Date, the Rights will be
transferred with and only with the Shares. Until the Distribution Date, the
surrender for transfer of any of the certificates representing Shares (the
"Share Certificates") will also constitute the surrender for transfer of the
Rights associated with the Shares represented by such Share Certificates. As
soon as practicable following the Distribution Date, separate certificates
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evidencing the Rights ("Rights Certificates") will be mailed to holders of
record of Shares as of the close of business on the Distribution Date. After the
Distribution Date, such separate Rights Certificates alone will evidence the
Rights.
The Purchaser believes that currently the Rights are not exercisable, Rights
Certificates have not been issued and the Rights are evidenced by the Share
Certificates. The Purchaser believes that under the Rights Agreement, as a
result of the commencement of the Offer, the Distribution Date will be as early
as April 17, 1995, unless prior to that date the Company's Board of Directors
redeems the Rights or takes action to delay the Distribution Date.
Unless and until the Purchaser declares that the Rights Condition is
satisfied, holders of Shares will also be required to tender one Right for each
Share tendered in order to effect a valid tender of such Share. If separate
certificates for the Rights are not issued, a tender of Shares will also
constitute a tender of associated Rights.
The Purchaser further believes that under the circumstances of the Offer and
under applicable law, the Board of Directors of the Company is obligated by its
fiduciary responsibilities to redeem the Rights or take such other action to
invalidate the Rights or otherwise render the Rights inapplicable to, or prevent
the dilutive provisions thereof from being triggered by, the Offer and the
Merger, in each case in order to permit the Offer and the Merger to be
consummated. In addition, the Purchaser believes that under the circumstances of
the Offer and under applicable law, the Independent Directors are obligated by
their fiduciary responsibilities to make the determination that the Offer is at
a price and on terms fair to and otherwise in the best interests of the Company
and its stockholders. However, there can be no assurance that the Board or a
majority of the Independent Directors will take such action.
The Purchaser is hereby requesting that the Company's Board of Directors
redeem the Rights or take such other action described above and that the
Company's Independent Directors make the determination described above. As
indicated above, any action by the Purchaser and the Parent to change the
composition of the Board of Directors would be intended to result in the
reconstituted Board taking action to redeem the Rights or taking such other
action or a majority of the then-Independent Directors making such determination
in order to satisfy the Rights Condition.
The Delaware Takeover Statute Condition. The Offer is subject to the
condition (the "Delaware Takeover Statute Condition") that the Purchaser shall
be satisfied, in its sole discretion, that the restrictions on business
combinations contained in Section 203 of the DGCL (the "Delaware Takeover
Statute") would not apply to the Purchaser or the Parent in connection with the
Offer or the Merger (as a result of action by the Company's Board of Directors,
the ownership by the Purchaser upon consummation of the Offer of at least 85% of
the outstanding voting stock of the Company (other than Shares held by directors
who are also officers and certain employee stock plans of the Company) or
otherwise).
In general, the Delaware Takeover Statute prohibits any person who is the
beneficial owner of 15% or more of the outstanding voting stock of a corporation
(a "Statutory Interested Stockholder") from engaging in certain business
combinations (including the Merger) with such corporation for a period of three
years following the date on which such person became a Statutory Interested
Stockholder, unless (i) either the transaction by which such person became a
Statutory Interested Stockholder or the business combination is approved by the
board of directors of the corporation prior to the date on which such person
became a Statutory Interested Stockholder, (ii) upon consummation of the
transaction which resulted in such person becoming a Statutory Interested
Stockholder, such person owned at least 85% of the voting stock outstanding at
the time the transaction commenced, excluding shares owned by (a) persons who
are both officers and directors of the corporation and (b) employee stock plans
in which employee participants do not have the right to determine confidentially
whether shares held subject to the plan will be tendered in a tender or exchange
offer (all such non-excluded voting stock, "Eligible Voting Stock"), or (iii)
subsequent to the date on which such person became a Statutory Interested
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Stockholder, the business combination is approved by the board of directors of
the corporation and authorized by the affirmative vote, at a meeting called for
that purpose, of at least two-thirds of the outstanding voting stock not
beneficially owned by the Statutory Interested Stockholder or any of its
affiliates or associates or by persons who are either directors or officers and
also employees of the Statutory Interested Stockholder. Consequently, under the
Delaware Takeover Statute, unless the Board of Directors of the Company approves
the Offer and the Merger in advance of the consummation of the Offer or the
Purchaser acquires 85% of the Eligible Voting Stock upon consummation of the
Offer, the Merger could not occur for three years unless it is approved by the
holders of two-thirds of the Shares that were not tendered in the Offer or owned
by the Purchaser or the Parent. A more detailed description of the Delaware
Takeover Statute is contained in Section 11.
Whether the Shares held by the Company Benefit Plans are Eligible Voting
Stock depends on whether the employee participants thereof have the right to
determine confidentially whether the Shares held subject to such plans will be
tendered in a tender or exchange offer. Because the provisions of certain
Company Benefit Plans are not publicly available, the Purchaser is unable to
determine if such Shares held by such plans will be considered for purposes of
determining whether the Purchaser acquires 85% of the Eligible Voting Stock of
the Company. According to the 1995 Proxy Statement, (i) 17,132,696 Shares were
outstanding at March 13, 1995 and (ii) at December 31, 1994, directors who were
also officers of the Company held an aggregate of approximately 107,346 Shares
(excluding Shares held through the Company Benefit Plans), all other directors
and officers of the Company held an aggregate of approximately 140,184 Shares
(excluding Shares held through the Company Benefit Plans), and the Company
Benefit Plans held an aggregate of 2,080,689 Shares. Assuming that all of the
Company Benefit Plans permit the employee participants thereof to determine
confidentially whether the Shares held subject to such plans will be tendered in
a tender or exchange offer, there are approximately 17,025,350 Shares of
Eligible Voting Stock outstanding, of which an aggregate of approximately 13.0%
is held by directors or officers of the Company or by the Company Benefit Plans.
If the Company were to have repurchased Shares under the Company Repurchase
Plan, then the directors or officers of the Company and the Company Benefit
Plans would hold a correspondingly greater percentage of the outstanding
Eligible Voting Stock.
The Purchaser is hereby requesting that the Board of Directors approve the
Offer and the Merger for purposes of the Delaware Takeover Statute. Under the
circumstances of the Offer and under applicable law, the Purchaser believes that
the Board of Directors of the Company is obligated by its fiduciary
responsibilities to approve, pursuant to the Delaware Takeover Statute, the
acquisition of Shares pursuant to the Offer and the Merger. However, there can
be no assurance that the Board of Directors will do so. If the Board does not so
approve the Offer and the Merger but upon consummation of the Offer the
Purchaser and the Parent together own at least 85% of the Eligible Voting Stock
of the Company, then the restrictions on business combinations contained in the
Delaware Takeover Statute would not be applicable. As indicated above, any
action by the Purchaser and the Parent to change the composition of the Board of
Directors would be intended to result in the reconstituted Board taking action
to approve the Offer and the Merger in order to satisfy the Delaware Takeover
Statute Condition.
* * *
The Purchaser expressly reserves the right to waive any one or more of the
conditions to the Offer. See Sections 11, 14 and 15.
In the event the Offer is not consummated, the Purchaser intends to explore
all options which may be available to it at such time, which may include without
limitation the acquisition of Shares through open market purchases, privately
negotiated transactions, another tender offer or exchange offer or otherwise,
upon such terms and at such prices as it shall determine, which may be more or
less than the price to be paid pursuant to the Offer. The Purchaser also
reserves the right to dispose of Shares.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION WHICH SHOULD BE READ BEFORE ANY DECISION IS MADE WITH
RESPECT TO THE OFFER.
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THE TENDER OFFER
1. TERM OF THE OFFER; EXPIRATION DATE. 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 on or prior to the
Expiration Date and not properly withdrawn as permitted by Section 4. The term
"Expiration Date" means 12:00 Midnight, New York City time, on Friday, April 28,
1995, unless and until the Purchaser, in its sole discretion, shall have
extended the period during 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.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, SATISFACTION OF EACH OF
THE CONDITIONS SET FORTH ABOVE IN THE INTRODUCTION AND IN SECTION 14. THE
PURCHASER RESERVES THE RIGHT (BUT SHALL NOT BE OBLIGATED) TO WAIVE ANY OR ALL OF
SUCH CONDITIONS.
If by the Expiration Date any or all of such conditions have not been
satisfied or waived, the Purchaser reserves the right (but shall not be
obligated) (i) to decline to purchase any of the Shares tendered and terminate
the Offer, (ii) to waive all of the unsatisfied conditions and, subject to
complying with applicable rules and regulations of the Commission, to purchase
all Shares validly tendered or (iii) to extend the Offer and, subject to the
right of stockholders to withdraw Shares until the Expiration Date, retain the
Shares which have been tendered during the period or periods for which the Offer
is extended. In the event that the Purchaser waives any of the conditions set
forth in Section 14, the Commission may, if the waiver is deemed to constitute a
material change to the information previously provided to the stockholders,
require that the Offer remain open for an additional period of time and/or that
the Purchaser disseminate information concerning such waiver.
The Purchaser expressly reserves the right, in its sole discretion, at any
time and from time to time, to extend the period during which the Offer is open
for any reason, including the occurrence of any of the conditions specified in
Section 14, by giving written notice of such extension to the Depositary. During
any such extension, all Shares previously tendered and not properly withdrawn
will remain subject to the Offer, subject to the rights of a tendering
stockholder to withdraw such stockholder's Shares. See Section 4.
Subject to the applicable regulations of the Commission, the Purchaser also
reserves the right, in its sole discretion, at any time or from time to time to
(i) delay acceptance for payment of or, regardless of whether such Shares were
theretofore accepted for payment, payment for any Shares pending receipt of any
regulatory approvals specified in Section 15, (ii) terminate the Offer (whether
or not any Shares have theretofore been accepted for payment) if any of the
conditions referred to in Section 14 has not been satisfied or upon the
occurrence of any of the events specified in Section 14 and (iii) waive any
condition or otherwise amend the Offer in any respect, in each case by giving
written notice of such delay, termination, waiver or amendment to the Depositary
and by making a public announcement thereof. The Purchaser acknowledges (i) that
Rule 14e-1(c) under the Exchange Act requires the Purchaser to pay the
consideration offered or return the Shares tendered promptly after the
termination or withdrawal of the Offer and (ii) that the Purchaser may not delay
acceptance for payment of, or payment for (except as provided in clause (i) of
the preceding sentence), any Shares upon the occurrence of any of the conditions
specified in Section 14 without extending the period of time during which the
Offer is open.
Any such extension, delay, termination, waiver or amendment will be followed
as promptly as practicable by public announcement thereof, and such announcement
in the case of an extension will be made no later than 9:00 A.M., New York City
time, on the next business day after the previously scheduled Expiration Date.
Without limiting the manner in which the Purchaser may choose to make any public
announcement, except as provided by applicable law (including Rules 14d-4(c) and
14d-6(d)
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under the Exchange Act, which require that material changes be promptly
disseminated to holders of Shares), the Purchaser shall have no obligation to
publish, advertise or otherwise communicate any such public announcement other
than by issuing a release to the Dow Jones News Service.
If the Purchaser makes a material change in the terms of the Offer or if it
waives a material condition of the Offer, the Purchaser will extend the Offer to
the extent required by Rules 14d-4(c) and 14d-6(d) 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 or a change in the
percentage of securities sought, will depend upon the facts and circumstances,
including the materiality, of the changes. With respect to a change in price or,
subject to certain limitations, a change in the percentage of securities sought,
a minimum ten business day period from the day of such change is generally
required to allow for adequate dissemination to stockholders. Accordingly, if
prior to the Expiration Date, the Purchaser decreases the number of Shares being
sought, increases or decreases the consideration offered pursuant to the Offer
and if the Offer is scheduled to expire at any time earlier than the period
ending on 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 ten business day period. For
purposes of the Offer, a "business day" means any day other than a Saturday,
Sunday or a federal holiday and consists of the time period from 12:01 A.M.
through 12:00 Midnight, New York City time.
A demand under Delaware law has been made to the Company for its list of
stockholders and security position listings for the purpose of disseminating the
Offer to holders of Shares and communicating with stockholders regarding proxy
solicitations in connection with the upcoming annual meeting. Upon compliance by
the Company with such request, this Offer to Purchase and the related Letter of
Transmittal and, if required, other relevant materials will be mailed to record
holders of Shares whose names appear on the Company's stockholder list 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 who are listed as participants in a clearing agency's security position
listing for subsequent transmittal to beneficial owners of Shares. On April 3,
1995, a request pursuant to Rule 14d-5 under the Exchange Act for use of the
Company's stockholder list and security position listings was also made to the
Company.
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), the Purchaser will
accept for payment and will pay for all Shares validly tendered and not properly
withdrawn on or prior to the Expiration Date as soon as practicable after the
later to occur of (i) the Expiration Date and (ii) the satisfaction or waiver of
the conditions of the Offer set forth in Section 14, including without
limitation the expiration or termination of the waiting period applicable to the
acquisition of Shares pursuant to the Offer under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended (the "HSR Act") and satisfaction
of any applicable foreign regulatory requirements. In addition, subject to
applicable rules of the Commission, the Purchaser expressly reserves the right
to delay acceptance for payment of or payment for Shares pending receipt of any
other regulatory approvals specified in Section 15.
The Parent intends to file on the date hereof with the Federal Trade
Commission (the "FTC") and the Antitrust Division of the Department of Justice
(the "Antitrust Division") a Premerger Notification and Report Form under the
HSR Act with respect to the Offer. Accordingly, the waiting period under the HSR
Act applicable to the Offer will expire at 11:59 P.M., New York City time, on
Tuesday, April 18, 1995, unless prior to the expiration or termination of the
waiting period, the FTC or the Antitrust Division extends the waiting period by
requesting additional information from the Parent. If such a request is made,
the waiting period applicable to the Offer will expire on the tenth calendar day
after the date of substantial compliance by the Parent with such request.
Thereafter, the waiting period may only be extended by court order. The waiting
period under the HSR Act may be terminated by the
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FTC and the Antitrust Division prior to its expiration. For information with
respect to approvals required to be obtained prior to the consummation of the
Offer, including under the HSR Act and under applicable regulations within the
European Economic Area (the "EEA"), see Section 15.
In all cases, payment for Shares tendered and accepted for payment pursuant
to the Offer will be made only after timely receipt by the Depositary of (i)
Share Certificates for such Shares and, if applicable, Rights Certificates, or
timely confirmation (a "Book-Entry Confirmation") of a book-entry transfer of
such Shares and, if applicable, Rights into the Depositary's account at The
Depository Trust Company, the Midwest Securities Trust Company or the
Philadelphia Depository Trust Company (each a "Book-Entry Transfer Facility"
and, collectively, the "Book-Entry Transfer Facilities") pursuant to the
procedures set forth in Section 3, (ii) 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 below) in connection
with a book-entry transfer, and (iii) any other documents required by the Letter
of Transmittal.
The term "Agent's Message" means a message transmitted by a Book-Entry
Transfer Facility to and received by the Depositary and forming a part of a
Book-Entry Confirmation, which states that such Book-Entry Transfer Facility has
received an express acknowledgment from the participant in such Book-Entry
Transfer Facility tendering the Shares and, if applicable, Rights which 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.
Unless and until the Purchaser declares that the Rights Condition is
satisfied, if Rights Certificates have been distributed to holders of Shares,
such holders are required to tender, or make book-entry transfer of, Rights
Certificates representing a number of Rights equal to the number of Shares being
tendered in order to effect a valid tender of such Shares.
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 purchase 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 stockholders whose Shares have been accepted
for payment. UNDER NO CIRCUMSTANCES WILL INTEREST ON THE PURCHASE PRICE FOR
SHARES BE PAID, REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY DELAY IN MAKING
SUCH PAYMENT. If for any reason whatsoever acceptance for payment of or payment
for any Shares tendered pursuant to the Offer is delayed or the Purchaser is
unable to accept for payment or pay for Shares tendered pursuant to the Offer,
then without prejudice to the Purchaser's rights set forth herein, the
Depositary may nevertheless, on behalf of the Purchaser and subject to Rule
14e-l(c) under the Exchange Act, retain tendered Shares and such Shares may not
be withdrawn except to the extent that the tendering stockholder is entitled to
and duly exercises withdrawal rights as described in Section 4.
If any tendered Shares are not accepted for payment for any reason or if
Share Certificates are submitted for more Shares than are tendered, Share
Certificates evidencing unpurchased or untendered 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 a Book-Entry Transfer
Facility pursuant to the procedures set forth in Section 3, such Shares will be
credited to an account maintained at such Book-Entry Transfer Facility), in each
case with the related Rights Certificates, if any, as promptly as practicable
following the expiration, termination or withdrawal of the Offer.
IF PRIOR TO THE EXPIRATION DATE THE PURCHASER INCREASES THE CONSIDERATION
OFFERED TO STOCKHOLDERS PURSUANT TO THE OFFER, SUCH INCREASED CONSIDERATION WILL
BE PAID TO ALL STOCKHOLDERS WHOSE SHARES ARE
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PURCHASED PURSUANT TO THE OFFER, WHETHER OR NOT SUCH SHARES WERE TENDERED OR
ACCEPTED FOR PAYMENT PRIOR TO SUCH INCREASE IN CONSIDERATION.
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 and Rights tendered pursuant to the Offer, but any
such transfer 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. PROCEDURE FOR TENDERING SHARES AND RIGHTS. Except as set forth below, in
order for Shares and, prior to the Distribution Date, Rights to be validly
tendered pursuant to the Offer, 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 connection with a book-entry
delivery of Shares and Rights, 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 on or prior to the Expiration
Date and either (i) Share Certificates and Rights Certificates, if applicable,
evidencing tendered Shares and Rights must be received by the Depositary at such
address or such Shares and Rights 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 on or prior to the Expiration Date, or
(ii) the guaranteed delivery procedures described below must be complied with.
If the Purchaser declares that the Rights Condition is satisfied, the
Purchaser will not require delivery of Rights Certificates. Unless and until the
Purchaser declares that the Rights Condition is satisfied, holders of Shares
will be required to tender one Right for each Share tendered in order to effect
a valid tender of such Share. ACCORDINGLY, STOCKHOLDERS WHO SELL THEIR RIGHTS
SEPARATELY FROM THEIR SHARES AND DO NOT OTHERWISE ACQUIRE RIGHTS MAY NOT BE ABLE
TO SATISFY THE REQUIREMENTS OF THE OFFER FOR A VALID TENDER OF SHARES.
Rights Certificates. If the Distribution Date has occurred and Rights
Certificates have been distributed to such holders prior to the date of tender
pursuant to the Offer, Rights Certificates representing a number of Rights equal
to the number of Shares being tendered must be delivered to the Depositary or,
if available, a Book-Entry Confirmation must be received by the Depositary with
respect thereto, in order for such Shares to be validly tendered. If the
Distribution Date has occurred and Rights Certificates have not been distributed
prior to the time Shares are tendered pursuant to the Offer, Rights may be
tendered prior to a stockholder receiving Rights Certificates by use of the
guaranteed delivery procedures described below. A tender of Shares without
Rights Certificates constitutes an agreement by the tendering stockholder to
deliver Rights Certificates representing a number of Rights equal to the number
of Shares tendered pursuant to the Offer to the Depositary within five business
days after the date such Rights Certificates are distributed. If the Rights
Condition is not satisfied, the Purchaser reserves the right to require that the
Depositary receive such Rights Certificates or a Book-Entry Confirmation with
respect to such Rights prior to accepting Shares for payment, if the
Distribution Date occurs prior to the Expiration Date. In that event, payment
for Shares tendered and accepted for payment pursuant to the Offer will be made
only after timely receipt by the Depositary of, or Book-Entry Confirmation with
respect to, among other things, Rights Certificates, if Rights Certificates have
been distributed to holders of Shares. See Section 1.
THE METHOD OF DELIVERY OF SHARE CERTIFICATES OR RIGHTS CERTIFICATES AND ALL
OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH ANY 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. IF
DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY
INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO
INSURE TIMELY DELIVERY.
Book-Entry Transfer. The Depositary will make a request to establish
accounts with respect to the Shares at the Book-Entry Transfer Facilities for
purposes of the Offer within two business days after the
10
<PAGE>
date of this Offer to Purchase. Any financial institution that is a participant
in the system of any Book-Entry Transfer Facility may make book-entry delivery
of Shares by causing such Book-Entry Transfer Facility to transfer such Shares
into the Depositary's account at such Book-Entry Transfer Facility in accordance
with such Book-Entry Transfer Facility's procedures for such transfer. However,
although delivery of Shares may be effected through book-entry transfer at a
Book-Entry Transfer Facility, 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 connection with a book-entry
transfer, and any other documents required by the Letter of Transmittal, 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 on or prior to the Expiration Date, or the
guaranteed delivery procedures described below must be complied with.
If the Distribution Date occurs, to the extent that the Rights become
eligible for book-entry transfer under procedures established by a particular
Book-Entry Transfer Facility, the Depositary will make a request to establish an
account with respect to the Rights at such Book-Entry Transfer Facility as soon
as practicable. If book-entry delivery of Rights is available, the foregoing
book-entry transfer procedure will also apply to Rights. However, no assurance
can be given that book-entry delivery of Rights will be available. If book-entry
delivery is not available and if separate Rights Certificates have been issued,
a tendering stockholder is not relieved of delivery requirements hereunder and
thus will be required to tender Rights by means of actual physical delivery of
Rights Certificates to the Depositary or pursuant to the guaranteed delivery
procedures set forth below.
DELIVERY OF DOCUMENTS TO A BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH
SUCH BOOK-ENTRY TRANSFER FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO
THE DEPOSITARY.
Signature Guarantees. Signatures on Letters of Transmittal must be
guaranteed by a firm which is a bank, broker, dealer, credit union, savings
association or other entity which is a member in good standing of the Securities
Transfer Agents Medallion Program (each of the foregoing being referred to as an
"Eligible Institution"), except in cases where Shares or Rights are tendered (i)
by a registered holder of Shares and Rights who has not completed either the box
labeled "Special Payment Instructions" or the box labeled "Special Delivery
Instructions" on the Letter of Transmittal or (ii) for the account of an
Eligible Institution. See Instruction 1 of the Letter of Transmittal.
If the Share Certificates or Rights Certificates are registered in the name
of a person other than the signer of the Letter of Transmittal, or if payment is
to be made, or Share Certificates or Rights Certificates not accepted for
payment or not tendered are to be returned, to a person other than the
registered holder, the Share Certificates or Rights Certificates, as the case
may be, must be endorsed or accompanied by appropriate stock powers, in either
case, signed exactly as the name of the registered holder appears on such
certificates, with the signatures on such certificates or stock powers
guaranteed as aforesaid. See Instructions 1 and 5 of the Letter of Transmittal.
If Share Certificates and Rights Certificates are forwarded separately to
the Depositary, a properly completed and duly executed Letter of Transmittal (or
a facsimile thereof) must accompany each such delivery.
Guaranteed Delivery. If a stockholder desires to tender Shares and Rights
pursuant to the Offer and such stockholder's Share Certificates or Rights
Certificates are not immediately available (including because Rights
Certificates have not yet been distributed by the Company), or such stockholder
cannot deliver the Share Certificates or Rights Certificates and all other
required documents to reach the Depositary on or prior to the Expiration Date,
or such stockholder cannot complete the procedure for delivery by book-entry
transfer on a timely basis, such Shares and Rights may nevertheless be tendered,
provided that all of the following conditions are satisfied:
(i) such tender is made by or through an Eligible Institution;
11
<PAGE>
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery substantially in the form made available by the Purchaser is
received by the Depositary as provided below on or prior to the Expiration
Date; and
(iii) the Share Certificates or Rights Certificates, as the case may be
(or a Book-Entry Confirmation), representing all tendered Shares or Rights,
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 (x) in the case of
Shares, five New York Stock Exchange, Inc. ("NYSE") trading days after the
date of execution of such Notice of Guaranteed Delivery or (y) in the case
of Rights, a period ending on the later of (1) five NYSE trading days after
the date of execution of such Notice of Guaranteed Delivery and (2) five
business days after the date the Rights Certificates are distributed to
stockholders of the Company.
The Notice of Guaranteed Delivery may be delivered by hand or transmitted by
telegram, telex, facsimile transmission or mail to the Depositary and must
include a guarantee by an Eligible Institution and a representation that the
stockholder owns the Shares and, if applicable, Rights tendered within the
meaning of, and that the tender of the Shares and, if applicable, Rights
effected thereby complies with, Rule 14e-4 under the Exchange Act, each in the
form set forth in such Notice of Guaranteed Delivery.
Notwithstanding any other provision hereof, payment for Shares accepted for
payment pursuant to the Offer will in all cases be made only after timely
receipt by the Depositary of Share Certificates for, or of Book-Entry
Confirmation with respect to, such Shares, and if the Distribution Date has
occurred, Rights Certificates for, or a Book-Entry Confirmation if available
with respect to, the associated Rights (unless the Purchaser elects, in its sole
discretion, to make payment for such Shares pending receipt of the Rights
Certificates for, or a Book-Entry Confirmation with respect to, such Rights), a
properly completed and duly executed Letter of Transmittal (or a facsimile
thereof), together with any required signature guarantees (or, in the case of a
book-entry transfer, an Agent's Message), and any other documents required by
the Letter of Transmittal. Accordingly, payment might not be made to all
tendering stockholders at the same time and will depend upon when Share
Certificates (or Rights Certificates) or Book-Entry Confirmations of such Shares
(or Rights, if available) are received into the Depositary's account at a
Book-Entry Transfer Facility.
If the Rights Condition is satisfied, the guaranteed delivery procedure with
respect to Rights Certificates and the requirement for the tender of Rights will
no longer apply.
Appointment as Proxy. By executing the Letter of Transmittal, a tendering
stockholder irrevocably appoints designees of the Purchaser and each of them as
such stockholder's attorneys-in-fact and proxies, 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 and Rights
tendered by such stockholder and accepted for payment by the Purchaser (and with
respect to any and all other Shares or Rights or other securities issued or
issuable in respect of such Shares on or after the date hereof). All such powers
of attorney and proxies shall be considered irrevocable and coupled with an
interest in the tendered Shares and Rights. Such appointment will be effective
when, and only to the extent that, the Purchaser accepts such Shares and Rights
for payment. Upon such acceptance for payment, all prior powers of attorney and
proxies given by such stockholder with respect to such Shares and Rights (and
such other shares and securities) will be revoked without further action, and no
subsequent powers of attorney and proxies may be given nor any subsequent
written consents executed (and, if given or executed, will not be deemed
effective). The designees of the Purchaser will, with respect to the Shares and
Rights (and such other shares and securities) for which such 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,
12
<PAGE>
by written consent in lieu of any such meeting or otherwise. The Purchaser
reserves the right to require that, in order for Shares and Rights to be deemed
validly tendered, immediately upon the Purchaser's payment for such Shares and
Rights, the Purchaser must be able to exercise full voting rights with respect
to such Shares, Rights and other securities, including voting at any meeting of
stockholders.
Determination of Validity. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance for payment of any tender
of Shares and Rights 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 of the conditions of the Offer or any defect or irregularity in any
tender of Shares and Rights 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. None of the Purchaser, the Parent, any
of their affiliates or assigns, 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.
BACKUP FEDERAL INCOME TAX WITHHOLDING AND SUBSTITUTE FORM W-9. UNDER THE
"BACKUP WITHHOLDING" PROVISIONS OF FEDERAL INCOME TAX LAW, THE DEPOSITARY MAY BE
REQUIRED TO WITHHOLD 31% OF THE AMOUNT OF ANY PAYMENTS OF CASH PURSUANT TO THE
OFFER. IN ORDER TO AVOID BACKUP WITHHOLDING, EACH STOCKHOLDER SURRENDERING
SHARES IN THE OFFER MUST PROVIDE THE PAYOR OF SUCH CASH WITH SUCH STOCKHOLDER'S
CORRECT TAXPAYER IDENTIFICATION NUMBER ("TIN") ON A SUBSTITUTE FORM W-9 AND
CERTIFY UNDER PENALTIES OF PERJURY THAT SUCH TIN IS CORRECT AND THAT SUCH
STOCKHOLDER IS NOT SUBJECT TO BACKUP WITHHOLDING. 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 ("IRS") MAY IMPOSE A PENALTY ON SUCH STOCKHOLDER
AND PAYMENT OF CASH TO SUCH 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 INCLUDED IN THE LETTER OF
TRANSMITTAL TO PROVIDE THE INFORMATION AND CERTIFICATION NECESSARY TO AVOID
BACKUP WITHHOLDING (UNLESS AN APPLICABLE EXEMPTION EXISTS AND IS PROVED IN A
MANNER SATISFACTORY TO THE DEPOSITARY). NONCORPORATE 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 9 OF THE LETTER OF TRANSMITTAL.
Other Requirements. The Purchaser's acceptance for payment of Shares and, if
applicable, Rights tendered pursuant to any of the procedures described above
will constitute a binding agreement between the tendering stockholder and the
Purchaser upon the terms and subject to the conditions of the Offer, including
the tendering stockholder's representation and warranty that the stockholder is
the holder of the Shares within the meaning of, and that the tender of the
Shares and Rights complies with, Rule 14e-4 under the Exchange Act.
4. WITHDRAWAL RIGHTS. Tenders of Shares and Rights made pursuant to the
Offer are irrevocable, except that Shares and Rights tendered pursuant to the
Offer may be withdrawn at any time on or 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 June 1, 1995 (or such later date as may
apply in case the Offer is extended). If the Purchaser extends the Offer, is
delayed in its acceptance for payment of Shares and Rights or is unable to
purchase Shares and Rights validly tendered 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 Rights and such Shares and Rights may not be withdrawn except to the extent
that tendering stockholders are entitled to withdrawal rights
13
<PAGE>
as described in this Section 4. Any such delay will be accompanied by an
extension of the Offer to the extent required by law.
For a withdrawal to be effective, a written, telegraphic, telex 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 this Offer to Purchase. Any
notice of withdrawal must specify the name of the person who tendered the Shares
or Rights to be withdrawn, the number of Shares or Rights to be withdrawn and
the name of the registered holder, if different from that of the person who
tendered such Shares or Rights. If Share Certificates or Rights Certificates 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 the signatures on the
notice of withdrawal must be guaranteed by an Eligible Institution unless such
Shares or Rights have been tendered for the account of any Eligible Institution.
If Shares or Rights have been tendered pursuant to the procedure for book-entry
transfer as set forth in Section 3, any notice of withdrawal must specify the
name and number of the account at the Book-Entry Transfer Facility to be
credited with the withdrawn Shares or Rights, in which case a notice of
withdrawal will be effective if delivered to the Depositary by any method of
delivery described in the first sentence of this paragraph. A withdrawal of
Shares or Rights shall also constitute a withdrawal of the associated Rights or
Shares, as applicable.
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 Parent, any of their affiliates or assigns, 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 any notice of
withdrawal or incur any liability for failure to give any such notification.
Withdrawals of Shares and Rights may not be rescinded. Any Shares or Rights
properly withdrawn will thereafter be deemed not to have been validly tendered
for purposes of the Offer. However, withdrawn Shares or Rights may be
re-tendered at any time prior to the Expiration Date by following one of the
procedures described in Section 3.
5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES. The summary of tax consequences
set forth below is for general information only and is based on the law as
currently in effect. The tax treatment of each stockholder will depend in part
upon such stockholder's particular situation. Special tax consequences not
described herein may be applicable to particular classes of taxpayers, such as
financial institutions, broker-dealers, persons who are not citizens or
residents of the United States, stockholders who acquired their Shares through
the exercise of an employee stock option or otherwise as compensation, and
persons who received payments in respect of options to acquire Shares. 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 CHANGES IN SUCH TAX LAWS.
The receipt of cash pursuant to the Offer or the Merger will be a taxable
transaction for Federal income tax purposes under the Internal Revenue Code of
1986, as amended, and may also be a taxable transaction under applicable state,
local, foreign income or other tax laws. Generally, a tendering stockholder will
recognize gain or loss in an amount equal to the difference between the cash
received by the stockholder pursuant to the Offer or the Merger and the
stockholder's adjusted tax basis in the Shares and the Rights tendered by the
stockholder and purchased pursuant to the Offer or the Merger. For Federal
income tax purposes, such gain or loss will be a capital gain or loss if the
Shares are a capital asset in the hands of the stockholder, and a long-term
capital gain or loss if the stockholder's holding period is more than one year
as of the date the Purchaser accepts such Shares for payment pursuant to the
Offer or the effective date of the Merger, as the case may be. There are
limitations on the deductibility of capital losses.
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<PAGE>
Proposals have recently been introduced in the House of Representatives and
the Senate to reduce the effective tax rates applicable to net long-term capital
gains. Additionally, the proposals would further limit the deduction for
long-term capital losses. These proposals would apply generally to transactions
effected after December 31, 1994. Therefore, if these proposals were enacted
into law, gains from sales of Shares pursuant to the Offer which constituted
long-term capital gains would generally be taxed at reduced effective tax rates.
However, there can be no assurance that these proposals will be enacted and, if
enacted, the effective dates of the proposals or the particular type of
transactions or assets to which the proposals apply could be modified. If the
proposals were enacted with an effective date subsequent to the Expiration Date
of the Offer, sales of Shares pursuant to the Offer which constituted long-term
capital gains would be taxed at the higher rates currently in effect.
Shareholders should consult their tax advisors about the impact of this proposed
legislation.
6. PRICE RANGE OF SHARES; DIVIDENDS. According to the 1994 Annual Report,
the Shares are listed and traded principally on the NYSE. The following table
sets forth, for the quarters indicated, the high and low sales prices per Share
on the NYSE as reported in the 1994 Annual Report with respect to periods
occurring in 1993 and 1994 and as reported by the Dow Jones News Service
thereafter, and the amount of cash dividends paid or declared per share for each
quarter based on publicly available sources.
<TABLE>
<CAPTION>
HIGH LOW DIVIDENDS
------------- ------------- ---------
<S> <C> <C> <C>
Year Ended December 31, 1993:
First Quarter..................................................... $ 24 1/8 $ 19 5/8 $ --
Second Quarter.................................................... 34 3/4 22 1/2 --
Third Quarter..................................................... 48 1/2 34 1/4 --
Fourth Quarter.................................................... 53 3/4 45 1/8 --
Year Ended December 31, 1994:
First Quarter..................................................... 65 5/8 50 1/8 --
Second Quarter.................................................... 69 1/8 55 3/4 --
Third Quarter..................................................... 71 1/8 59 1/4 --
Fourth Quarter.................................................... 70 3/4 51 1/8 --
Year Ended December 31, 1995:
First Quarter..................................................... 84 49 1/8 --
</TABLE>
On March 31, 1995, the last full trading day prior to announcement of the
Offer, the closing sale price per Share reported on the NYSE was $82 1/2. On
March 27, 1995, the day prior to the Parent's issuance of the press release
announcing the transmission of a letter to the Company containing a proposal to
acquire the Company in a transaction in which stockholders would receive between
$75 and $77 per Share in cash, the closing sale price per Share reported on the
NYSE was $52 5/8. The Offer represents a 52% premium over the $50 1/2 closing
sale price per Share reported on the NYSE on March 14, 1995, the last full
trading day before the Parent first contacted the Company to convey its proposal
to acquire the Company at a price of between $75 and $77 per Share in cash.
STOCKHOLDERS ARE URGED TO OBTAIN A CURRENT MARKET QUOTATION FOR THE SHARES.
The Rights are currently attached to the outstanding Shares and may not be
traded separately. As a result of the commencement of the Offer, the
Distribution Date may be as early as April 17, 1995, after which the Rights
could begin trading separately from the Shares. See Section 11. IN SUCH EVENT,
STOCKHOLDERS ARE URGED TO OBTAIN A CURRENT MARKET QUOTATION, IF ANY, FOR THE
RIGHTS. Unless and until the Purchaser declares that the Rights Condition is
satisfied, holders of Shares will be required to tender one Right for each Share
tendered in order to effect a valid tender of such Share. Accordingly,
stockholders who sell their Rights separately from their Shares and do not
otherwise acquire Rights may not be able to satisfy the requirements of the
Offer for a valid tender of Shares.
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<PAGE>
7. CERTAIN INFORMATION CONCERNING THE COMPANY. The information concerning
the Company contained in this Offer to Purchase, including financial
information, has been taken from or based upon publicly available documents and
records on file with the Commission and other public sources. The summary
information concerning the Company in this Section 7 and elsewhere in this Offer
to Purchase is derived from the 1994 Annual Report and other publicly available
information. The summary information set forth below is qualified in its
entirety by reference to such reports (which may be obtained and inspected as
described below) and should be considered in conjunction with the more
comprehensive financial and other information in such reports and other publicly
available reports and documents filed by the Company with the Commission and
other publicly available information. Although the Purchaser and the Parent do
not have any knowledge that would indicate that any statements contained herein
based upon such reports are untrue, neither the Purchaser nor the Parent assumes
any responsibility for the accuracy or completeness of the information contained
therein, 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
which are unknown to the Purchaser and the Parent.
General. The Company is a Delaware corporation and is the successor to
certain corporations, the first of which was organized in 1902. The Company's
principal executive offices are located at 100 North Michigan Street, P.O. Box
7008, South Bend, Indiana 46634. The telephone number of the Company at such
offices is (219) 239-0100.
The Company's business, together with its subsidiaries, is the design,
manufacture and sale of compact construction machinery, asphalt paving
equipment, axles and transmissions for off-highway equipment and golf carts and
utility vehicles.
The Company's Melroe Company Business Unit ("Melroe") is the leading
manufacturer of skid steer loaders and also manufactures compact excavators and
a limited line of agricultural equipment domestically, all of which it
distributes throughout the world to, among others, the construction and
agricultural industries under the trademarks "Melroe" and "Bobcat". Melroe
products are also manufactured by a licensee in Australia. The Company's
Clark-Hurth Components Company Business Unit ("Clark-Hurth") manufactures
off-highway axles and transmissions in the United States, Belgium and Italy for
sale throughout the world to the construction, mining and material handling
equipment industries. Clark-Hurth products are also manufactured by a licensee
in South Africa. The Company maintains engineering staffs at each of its
principal manufacturing facilities which are supplemented by laboratories to
engage in engineering and product development activities, including product
testing, materials research and process development.
On May 13, 1994, the Company completed the purchase of the Blaw-Knox
Construction Equipment Corporation ("Blaw-Knox") and related assets in the
United Kingdom. Blaw-Knox is a leading manufacturer of asphalt pavers which are
sold in North America and other world markets. On March 17, 1995, the Company
completed the acquisition of Club Car, Inc. ("Club Car"), which designs,
manufactures, markets and services electric and gasoline golf cars for
recreational use and similar off-road utility vehicles for golf, commercial and
industrial use.
On March 6, 1995, the Company announced that it had signed a definitive
agreement to sell its 50% interest in VME Group N.V. ("VME") to AB Volvo of
Sweden ("Volvo") for $573 million. VME is a joint venture between the Company
and Volvo which manufactures and sells construction and earth-moving equipment.
Financial Information. Set forth below are certain selected consolidated
financial data for the Company's last three fiscal years which were derived from
the 1994 Annual Report as well as selected consolidated financial data for 1994
shown on a pro forma basis to give effect to the Company's acquisition of Club
Car which were derived from the Company's Current Report on Form 8-K filed with
the Commission for March 13, 1995 (the "March 13 Form 8-K"). More comprehensive
financial information is included in the reports (including management's
discussion and analysis of financial condition and results of operations) and
other documents filed by the Company with the Commission,
16
<PAGE>
and the following financial data is qualified in its entirety by reference to
such reports and other documents including the financial information and related
notes contained therein. Such reports and other documents may be examined and
copies thereof may be obtained from the offices of the Commission and the NYSE
in the manner set forth below.
CLARK EQUIPMENT COMPANY
SELECTED CONSOLIDATED FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
PRO FORMA FOR
CLUB CAR ACQUISITION FOR THE YEAR ENDED DECEMBER 31,
FOR THE YEAR ENDED ----------------------------------
DECEMBER 31, 1994(A) 1994 1993 1992
-------------------- ---------- ---------- --------
<S> <C> <C> <C> <C>
INCOME STATEMENT DATA
Net Sales.................................. $1,138,400 $ 946,599 $ 692,022 $658,535
Income from Continuing Operations.......... 61,200 62,815 21,579 12,016
Income (Loss) from Discontinued
Operations................................. 99,120 20,290 (38,058)
---------- ---------- --------
Income (Loss) before Effect of Changes in
Accounting Principles...................... 161,935 41,869 (26,042)
Effect of Accounting Changes--Income
Taxes...................................... 0 6,150 92,000
---------- ---------- --------
Net Income................................. $ 161,935 $ 48,019 $ 65,958
---------- ---------- --------
---------- ---------- --------
INCOME (LOSS) PER SHARE
From Continuing Operations................. $3.52 $3.61 $1.24 $0.69
From Discontinued Operations............... 5.69 1.17 (2.19)
From Effect of Accounting Changes.......... 0.00 0.35 5.31
---------- ---------- --------
Net Income................................. 9.30 2.76 3.81
---------- ---------- --------
---------- ---------- --------
Average Number of Shares Used to Compute
Net Income per Share....................... 17,400 17,412 17,421 17,334
BALANCE SHEET DATA (AT PERIOD END)
Working Capital............................ $ 182,600 $ 290,517 $ 255,006 $199,608
Total Assets............................... 1,361,800 1,193,899 1,003,274 958,691
Total Liabilities.......................... 909,600 741,739 735,121 706,104
Total Stockholders' Equity................. 452,200 452,160 268,153 252,587
</TABLE>
- ------------
(a) Pro forma balance sheet and pro forma income statement data are as presented
in the Pro Forma Financial Information sections of the March 13 Form 8-K and
are rounded to the nearest 100,000 (except per Share amounts).
The Shares are registered under the Exchange Act. Accordingly, the Company
is subject to the informational filing requirements of the Exchange Act and in
accordance therewith is obligated to file periodic reports, proxy statements and
other information with the Commission relating to its business, financial
condition and other matters. Information as of particular dates concerning the
Company's directors and officers, their remuneration, options granted to them,
the principal holders of the Company's securities and any material interest of
such persons in transactions with the Company is required to be disclosed in
such proxy statements and distributed to the Company's stockholders and filed
with the Commission. Such reports, proxy statements and other information should
be available for inspection at the public reference facilities of the Commission
located in Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and
should also be available for inspection and copying at prescribed rates at the
regional offices of the Commission located at Citicorp Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661, and Seven World Trade Center, Suite
1300, New York, New York 10048. Copies of this material may also be obtained by
mail, upon payment of the
17
<PAGE>
Commission's customary fees, from the Commission's principal office at 450 Fifth
Street, N.W., Washington, D.C. 20549. In addition, such material should also be
available for inspection at the library of the New York Stock Exchange, 20 Broad
Street, New York, New York 10005. Except as otherwise noted in this Offer to
Purchase, all of the information with respect to the Company set forth in this
Offer to Purchase has been derived from publicly available information.
8. CERTAIN INFORMATION CONCERNING THE PURCHASER AND THE PARENT. The
Purchaser, a Delaware corporation and a wholly owned subsidiary of the Parent,
was organized in connection with the Offer and has not carried on any activities
to date other than those incident to its formation and the commencement of the
Offer.
The Parent is a New Jersey corporation organized in 1905. The Parent,
together with its subsidiaries, manufactures and sells primarily industrial
machinery and capital equipment, including compressors, bearings, pumps, engine
starting systems, power tools, rock drills, construction equipment, automotive
components and door hardware. The Parent believes that it is one of the leading
manufacturers in the world of a broad line of air compression systems,
anti-friction bearings, construction equipment, air tools and pumps. In
addition, it believes it is also an important factor in domestic markets for
locks and other door hardware products. Products are sold primarily under the
Parent's name and also under other names including Torrington, Fafnir, Klemm,
Schlage, CPM, LCN Closers, Von Duprin, Aro, ABG, Ingersoll-Dresser Pumps,
Pacific, Worthington, Jeumont-Schneider Pumps and Pleuger.
The Parent is involved in two ventures with Dresser Industries, Inc.:
Dresser-Rand Company, which manufactures and sells reciprocating compressors and
turbomachinery worldwide and in which the Parent has a 49% interest, and
Ingersoll-Dresser Pump Company, which manufactures and sells industrial pumps
and in which the Parent has a 51% interest. The Parent also maintains extensive
research, engineering and development facilities for experimenting, testing and
developing high quality products.
The name, citizenship, business address, principal occupation or employment,
and five year employment history of each of the directors and executive officers
of the Purchaser and the Parent and certain other information are set forth in
Schedule I hereto.
Set forth below are certain selected consolidated financial data relating to
the Parent and its subsidiaries for the Parent's last three fiscal years which
have been derived from the financial statements contained in the Parent's Annual
Report on Form 10-K for the fiscal year ended December 31, 1994 filed by the
Parent with the Commission. More comprehensive financial information is included
in the reports (including management's discussion and analysis of financial
condition and results of operations) and other documents filed by the Parent
with the Commission, and the following financial data is qualified in its
entirety by reference to such reports and other documents, including the
financial information and related notes contained therein. Such reports and
other documents may be examined and copies thereof may be obtained from the
offices of the Commission and the NYSE in the same manner as set forth with
respect to information about the Company in Section 7.
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INGERSOLL-RAND COMPANY
SELECTED CONSOLIDATED FINANCIAL DATA
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
FOR THE YEAR ENDED DECEMBER 31,
--------------------------------------
1994 1993 1992
---------- ---------- ----------
<S> <C> <C> <C>
INCOME STATEMENT DATA
Net Sales.............................................. $4,507,470 $4,021,071 $3,783,787
Earnings Before Effect of Accounting Changes........... 211,140 163,524 115,594
Effect of Accounting Changes........................... 0 (21,000) (350,000)
---------- ---------- ----------
Net Earnings (Loss).................................... $ 211,140 $ 142,524 $ (234,406)
---------- ---------- ----------
---------- ---------- ----------
EARNINGS PER SHARE
Earnings Before Effect of Accounting Changes........... $2.00 $1.56 $1.11
Net Earnings (Loss).................................... 2.00 1.36 (2.25)
Average Number of Shares Outstanding for EPS
Calculation............................................ 105,458 104,992 104,341
BALANCE SHEET DATA (AT PERIOD END)
Working Capital........................................ $ 962,810 $ 877,836 $ 887,816
Total Assets........................................... 3,596,921 3,375,332 3,387,552
Total Liabilities...................................... 2,065,579 2,025,507 2,094,177
Total Shareowners' Equity.............................. 1,531,342 1,349,825 1,293,375
</TABLE>
The Parent currently beneficially owns an aggregate of 274,200 Shares,
representing approximately 1.6% of the 17,132,696 Shares reported by the Company
as outstanding at March 13, 1995, all of which Shares were acquired by the
Parent in the transactions described in Schedule II.
Except as described in this Offer to Purchase and in Schedules I and II,
none of the Purchaser, the Parent nor, to the best knowledge of the Purchaser
and the Parent, any of the persons listed on Schedule I hereto or any associate
or majority-owned subsidiary of the Purchaser, the Parent or any of the persons
so listed, beneficially owns or has a right to acquire directly or indirectly
any Shares, and none of the Purchaser, the Parent nor, to the best knowledge of
the Purchaser and the Parent, any of the persons or entities referred to above,
or any of the respective executive officers, directors or subsidiaries of any of
the foregoing, has effected any transactions in the Shares during the past 60
days.
Various divisions, subsidiaries and affiliates of the Parent purchase
products from or sell products to various divisions and subsidiaries of the
Company, in all cases in amounts which are not material. Except as set forth in
this Offer to Purchase, neither the Purchaser nor the Parent or, to the best
knowledge of the Purchaser and the Parent, any of the persons listed on Schedule
I hereto, has any contract, arrangement, understanding or relationship with any
other person with respect to any securities of the Company, including but not
limited to contracts, arrangements, understandings or relationships concerning
the transfer or voting of such securities, joint ventures, loan or option
arrangements, puts or calls, guarantees of loans, guarantees against loss or the
giving or withholding of proxies. Except as set forth in this Offer to Purchase,
neither the Purchaser nor the Parent or, to the best knowledge of the Purchaser
and the Parent, any of the persons listed on Schedule I hereto, has had since
January 1, 1992 any business relationships or transactions with the Company or
any of its executive officers, directors or affiliates that are required to be
reported under the rules and regulations of the Commission applicable to the
Offer. Except as set forth in this Offer to Purchase, since January 1, 1992
there have been no contacts, negotiations or transactions between any of the
Parent, the Purchaser or, to the best knowledge of the Purchaser and the Parent,
any of the persons listed in Schedule I hereto, on the one hand, and the Company
or its affiliates, on the other hand, concerning a merger, consolidation or
19
<PAGE>
acquisition, a tender offer or other acquisition of securities, an election of
directors, or a sale or other transfer of a material amount of assets.
9. SOURCE AND AMOUNT OF FUNDS. The total amount of funds required by the
Purchaser to purchase all of the outstanding Shares and pay related fees and
expenses is expected to be approximately $1.34 billion. The Purchaser will
obtain such funds through capital contributions by the Parent and/or various
wholly-owned direct or indirect subsidiaries of the Parent. The Parent and/or
such subsidiaries will obtain such funds through borrowings from commercial
banks and from its general corporate funds.
The Parent has accepted a commitment letter (the "Commitment Letter") from
The Chase Manhattan Bank (National Association) ("Chase"), which provides that
so long as the Offer has been consummated on or before August 31, 1995 Chase
will provide to the Parent, on specified terms and subject to specified
conditions, $1.35 billion, a portion of which may be provided by a syndicate of
banks and/or other financial institutions acceptable to the Parent and Chase,
and will act as administrative agent (the "Administrative Agent") for the
Facility.
The Commitment Letter contemplates a five-year reducing revolving credit
facility in the amount of $1.35 billion (the "Facility"). The proceeds of the
Facility may be used by the Parent to finance the Offer and the Merger and to
pay related fees, commissions and expenses. The Facility will be guaranteed by
the Purchaser until the consummation of the Merger. The Facility will be
secured, on an equal and ratable basis with the Parent's $400 million Credit
Agreement dated as of October 31, 1994 (the "Existing Credit Agreement") and any
other long-term notes or debentures that by their express terms so require, by a
pledge of all the capital stock of, and the Parent's advances to, the Purchaser.
Such security shall be released on or after the Initial Facility Reduction Date
(as defined below), upon receipt by the Administrative Agent of a certificate of
the Parent that no default exists under the Facility.
The Facility will be reduced to $1.0 billion on the date (the "Initial
Facility Reduction Date") which is the earlier of (i) 45 days after the
consummation of the Merger or (ii) 180 days after the consummation of the Offer.
The remaining Facility will be reduced at the end of the second, third, fourth
and fifth years after the consummation of the Offer by $100 million, $200
million, $300 million and $400 million, respectively. Upon the issuance by the
Parent or any of its subsidiaries for cash of any debt maturing on or after the
Facility's maturity date (other than refinancing of existing debt of foreign
subsidiaries or of certain debt of the Parent and other than up to $25 million
of domestic economic development financing) or of any equity (in each case,
other than inter-company), the Facility will be reduced by an amount equal to
the net cash proceeds of such debt or equity financing. Loans under the Facility
("Loans") must be repaid on the date of any such reduction to the extent the
amount of outstanding Loans exceeds the amount of the Facility as so reduced.
Until the earlier of completion of the primary syndication or 30 days after
consummation of the Offer, the Loans will bear interest, at the Parent's option,
at Chase's Base Rate or at a rate determined through a competitive bid process
among the lenders based on a spread above or below LIBOR or a fixed rate (a "Bid
Rate"). Thereafter, the Loans will bear interest at the Parent's option at
Chase's Base Rate, a Bid Rate or at specified spreads above a CD rate or LIBOR
(adjusted for reserves). Loans bearing interest at LIBOR will be for interest
periods of 1, 2, 3, 6, 9 or 12 month periods, and loans bearing interest at the
CD Rate will be for interest periods of 30, 60, 90, 180, 270 or 360 days, at the
Parent's option (9 or 12 month and 270 or 360 day interest periods to be
acceptable to all lenders except in the case of Bid Rate LIBOR Loans). Bid Rate
Loans bearing interest at a fixed rate may be made for any period up to 360
days. All interest will be paid at the end of the applicable interest period or
quarterly, whichever is earlier.
Chase's commitment to provide the Facility may be terminated in the event of
certain customary events as follows: (a) if (i) the terms of the Offer or the
Merger are changed in any manner, (ii) information provided to Chase by or on
behalf of the Parent proves to be inaccurate or incomplete in any respect, (iii)
any adverse change occurs or (iv) any additional information is disclosed to or
20
<PAGE>
discovered by Chase, that in case of clauses (i) through (iv) Chase deems to be
materially adverse in respect of the condition (financial or otherwise),
business, operations, assets or liabilities of the Parent and its subsidiaries
taken as a whole or the Company and its subsidiaries taken as a whole, (b)
failure to pay any of the fees payable to Chase or the lenders in connection
with the Facility and (c) any material adverse change in loan syndication or
capital market conditions generally. The conditions precedent to the initial
borrowing under the Facility include (a) execution and delivery of satisfactory
loan documentation, (b) the lenders' reasonable satisfaction with the terms and
conditions of the Offer, (c) the principal conditions to the consummation of the
Offer having been satisfied and not having been waived, provided that conditions
which must be satisfied to the satisfaction of the Purchaser must also be
fulfilled to the satisfaction of lenders in their reasonable determination, and
(d) the Shares having been accepted for payment pursuant to the Offer in
accordance with the terms of the Offer. It is a further condition precedent to
the initial borrowing under the Facility that after giving effect to the
consummation of the Offer, the Purchaser shall own and control that number of
Shares as shall be necessary to permit the Purchaser to approve the Merger
without the affirmative vote or approval of any other shareholders. In addition,
the Offer and financing must be in compliance with applicable law, and all
licenses, consents and approvals necessary to consummate the Offer and the
Merger must be in full force and effect, in order for the initial borrowing
under the Facility to occur. Conditions to each extension of credit under the
Facility will be reasonably consistent with those contained in the Existing
Credit Agreement.
The definitive documentation relating to the Facility also will contain
representations, warranties, covenants and events of default and conditions
reasonably consistent with those contained in the Existing Credit Agreement and
other provisions customary for transactions of this type. In addition, the
Facility will contain covenants that (a) total subsidiary (other than
inter-company) debt will not exceed $600 million at any time that the Parent's
senior unsecured long-term debt rating is below investment-grade, (b) until the
Initial Facility Reduction Date, total debt of the Parent and its subsidiaries
(including the Company and its subsidiaries) will not exceed $2.5 billion and
(c) consolidated shareholders' equity of the Parent and its subsidiaries will
not be less than $1.1 billion plus a certain percentage of cumulative net
earnings and a certain percentage of cumulative net proceeds of equity
issuances, in each case after December 31, 1994.
The Parent has agreed to pay specified fees to Chase and the lenders in
connection with the Facility. The Parent also has agreed to pay certain expenses
of, and provide customary indemnities to, Chase and (under certain
circumstances) the other lenders under the Facility.
The foregoing summary of the source and amount of funds is qualified in its
entirety by reference to the text of the Commitment Letter, a copy of which is
filed as an exhibit to the Tender Offer Statement on Schedule 14D-1 of the
Purchaser and the Parent filed with the Commission in connection with the Offer
(the "Schedule 14D-l") and is incorporated herein by reference and may be
inspected in the same manner as set forth in Section 7. When definitive
agreements relating to the Facility are executed, copies will be filed as
exhibits to amendments to the Schedule 14D-1.
As noted above, the Facility will be reduced to $1.0 billion on the earlier
of 45 days after consummation of the Merger or 180 days after consummation of
the Offer. At that time, Parent intends to repay the amount by which the
Facility exceeds $1.0 billion (which amount is presently expected to be $350
million) in the following manner. The Parent intends to use up to $150 million
of cash and cash equivalents that it has on hand and/or, if the Merger has been
consummated, up to $350 million of cash and cash equivalents which the Company
will then have on hand (including some of the proceeds which the Company will
shortly be receiving from the sale of its 50% interest in VME (see Section 7)),
to fund the entire amount of such repayment. If the Merger has not been
consummated, or if it has but the Company's cash and cash equivalents on hand
are not sufficient to fund the entire amount of such required repayment not
funded out of the Parent's cash and cash equivalents on hand, the Parent intends
to obtain the remaining funds necessary to effect such repayment from the
proceeds of private
21
<PAGE>
placements under a commercial paper program of the Parent or other borrowings by
the Parent, including possible drawdowns under the Existing Credit Agreement.
The Parent anticipates that the remainder of the Facility will be repaid
with internally generated funds, including those of the Company if the Merger is
consummated, and from the proceeds of future borrowings or other debt or equity
financings. At this time, no specific plans or arrangements have been made for
any such future borrowings or other financings. However, after consummation of
the Merger, the Parent intends to explore various possible plans for long-term
debt financing that might be considered to refinance part of the Facility and
any commercial paper issuances or other borrowings that were used to refinance
part of the Facility as noted above.
10. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY. For more than one
year prior to the Offer, members of the Parent's senior management have
considered potential transactions which could enhance the value of the Parent
for its stockholders, including the possibility of a strategic acquisition of
another industrial company or business such as the Company. The Parent developed
an extensive list of potential acquisition candidates and then gradually
narrowed the list of potential candidates by applying various acquisition
criteria. Detailed analysis was then performed on a select group of companies to
help narrow the list of potential acquisition candidates even further. In
January 1995, the Parent's discussions regarding possible acquisitions began to
focus particularly on the Company and actions were taken to effect a more formal
analysis of the Company.
On March 15, 1995, James E. Perrella, Chairman, President and Chief
Executive Officer of the Parent, had a telephone conversation with Leo J.
McKernan, Chairman, President and Chief Executive Officer of the Company. Mr.
Perrella said that he had called Mr. McKernan to propose that the Parent acquire
the Company in an all-cash merger transaction in which the stockholders of the
Company would receive between $75.00 and $77.00 in cash per share. Mr. McKernan
immediately replied that the Company was "not interested" in any transaction
with the Parent and Mr. McKernan then terminated the phone call.
On March 15, 1995, Mr. Perrella sent the following letter to Mr. McKernan
and to each of the Company's directors:
March 15, 1995
Mr. Leo J. McKernan
Chairman, President and Chief Executive Officer
Clark Equipment Company
100 North Michigan Street
South Bend, Indiana 46634
Dear Leo:
I was disappointed that you did not give me the chance to explain fully
our proposal when we spoke today. I would have much preferred to convey
to you personally everything that I wanted to say, but since I was
unable to do so, I am sending this letter to set forth our specific
proposal.
Ingersoll-Rand Company proposes to acquire Clark Equipment Company in a
merger transaction in which Clark's stockholders would receive between
$75.00 and $77.00 in cash for each share of outstanding Clark common
stock. We think the lower end of that range is the appropriate price,
but I would like to meet with you to give you the opportunity to
convince us that the higher end of the range is justified.
22
<PAGE>
We believe our proposal presents an extremely attractive opportunity for
Clark's stockholders, who at $75.00 per share would receive a premium of
50% over today's closing market price of Clark common stock. We and our
financial advisors believe that Clark's stockholders will
enthusiastically support our proposal.
We have been studying Clark for some time and we are extremely impressed
with the businesses you have so ably built up and the manner in which
they complement Ingersoll-Rand's businesses. We believe the
complementary aspects of our two companies' products, customers and
distribution capabilities would enable the combined entity to be an even
more effective competitor in the global marketplace.
Our proposal visualizes the negotiation and execution of a mutually
acceptable definitive merger agreement, the operation of Clark in the
ordinary course of business and the taking of the various actions by
Clark's Board necessary to facilitate the completion of the transaction.
Our proposal also assumes Clark's consummation of the sale of its 50%
interest in VME to Volvo on substantially the terms previously
announced. Our antitrust counsel has studied the two companies'
businesses and we do not believe that our proposal gives rise to any
meaningful antitrust concerns. We are confident that any antitrust
issues would readily be resolved. Finally, based on our discussions with
Ingersoll-Rand's principal senior lender, we are also confident that the
necessary financing for this transaction can easily be arranged.
We hope that you and your Board of Directors will view this proposal as
we do--a unique opportunity for Clark's stockholders to realize full
value for their shares in a transaction that can quickly be consummated.
We are prepared to meet with you and your advisors to answer any
questions that you may have about our proposal and to proceed
expeditiously to negotiate a definitive merger agreement with you.
My purpose in sending this letter is to provide you and your fellow
directors with information about our proposal and to express our sincere
desire to work together with you to reach agreement on a transaction
that can be presented to Clark's stockholders as the joint effort of
Ingersoll-Rand's and Clark's Boards of Directors and management. At this
point, therefore, we hope that our discussions can remain a private
matter between us.
Needless to say, it is important that we hear from you as soon as
practicable as to your Board's views about our proposal.
Sincerely,
James E. Perrella
Chairman, President and Chief Executive Officer
cc: Members of the Board of Directors of Clark Equipment Company
On March 20, 1995, Mr. McKernan telephoned Mr. Perrella and informed him
that the Company would give serious consideration to the Parent's proposal, and
that he would convene a special meeting of the Company's Board of Directors
within the upcoming week to consider the proposal.
23
<PAGE>
On March 21, 1995, Mr. Perrella sent the following letter to Mr. McKernan:
March 21, 1995
Mr. Leo J. McKernan
Chairman, President and Chief Executive Officer
Clark Equipment Company
100 North Michigan Street
South Bend, Indiana 46634
Dear Leo:
I appreciated your phone call yesterday. I think it would be in our
mutual best interests for us to continue to stay in touch with each
other as events unfold.
We hope you will be able to convene your Board as soon as possible this
week since time is so important. But we certainly hope that Monday would
be the latest possible date for your Board meeting.
When it does meet, we hope that your Board will view this proposal as we
do--as an unusual opportunity for Clark's stockholders to realize full
value for their shares in a transaction that will create a company that
will be uniquely positioned in the global marketplace.
I want to stress my desire to meet with you to discuss our proposal and
answer any questions that you may have about it. I would like to give
you the opportunity to show us how the higher end of the range that I
mentioned in my March 15 letter might be justified.
Thanks again for your call.
Sincerely,
James E. Perrella
On March 23, 1995, Mr. McKernan telephoned Mr. Perrella to report that the
Company's Board would be meeting on Monday, March 27, 1995 to consider the
Parent's proposal.
24
<PAGE>
On March 28, 1995, Mr. Perrella received the following letter (the "March 27
Clark Letter") from Mr. McKernan:
March 27, 1995
Mr. James E. Perrella
Chairman, President and Chief Executive Officer
Ingersoll-Rand Company
200 Chestnut Ridge Road
Woodcliff Lake, NJ 07675
Dear Mr. Perrella:
The Board of Directors of Clark Equipment Company met today to consider
your letter of March 15, 1995. During the meeting, we considered the
views of our financial and legal advisors and other issues we deemed
appropriate.
Although the Board of Directors appreciates your interest in Clark
Equipment Company as a strategic acquisition, the Board of Directors
unanimously reaffirmed its long-standing position that the Company is
not for sale. We therefore decline your proposal.
The management team at Clark, with the full support of the Board, has
been successfully implementing a strategic plan which has benefited our
shareholders materially. As a result of our efforts, Clark Equipment
Company enjoys an outstanding reputation with its shareholders,
customers and the financial community. The management and Board of
Directors of Clark believe that our shareholders will continue to
benefit materially from our commitment to stay the course of our
strategic plan.
Thank you again for your expression of interest in Clark. The Board of
Directors requests that this letter remain confidential and that it
shall serve as an appropriate final response to your inquiry.
Sincerely,
Leo J. McKernan
Following receipt of Mr. McKernan's letter, Mr. Perrella telephoned Mr.
McKernan on March 28, 1995 to urge Mr. McKernan and the Company's Board to
reconsider their rejection of the Parent's proposal. Mr. McKernan reiterated the
Board's position that the Company was not for sale. Later that day, Mr. Perrella
sent the letter set forth below to Mr. McKernan and the Parent issued the
following press release:
Woodcliff Lake, N.J. (March 28, 1995)--Ingersoll-Rand Company
announced today that it had submitted a proposal to Clark Equipment
Company for the acquisition of Clark in a merger transaction in which
Clark's stockholders would receive between $75 and $77 in cash per
share.
A letter sent today by James E. Perrella, Chairman, President and
Chief Executive Officer of Ingersoll-Rand, to Clark's Chairman is
attached.
Ingersoll-Rand first submitted its acquisition proposal to Clark on
March 15, 1995. Clark advised Ingersoll-Rand today that at a meeting
held on March 27, 1995 Clark's Board of Directors had rejected
Ingersoll-Rand's proposal.
25
<PAGE>
Here is the full text of Ingersoll-Rand's letter:
March 28, 1995
Mr. Leo J. McKernan
Chairman, President and Chief Executive Officer
Clark Equipment Company
100 North Michigan Street
South Bend, Indiana 46634
Dear Leo:
We are surprised and disappointed that Clark Equipment Company's Board
has rejected our acquisition proposal and "reaffirmed its long-standing
position that the Company is not for sale." We would have thought that
an acquisition proposal at a 50% premium over the price at which Clark
common stock has recently been trading--and a price exceeding Clark's
all time high stock price--would have led to a more constructive
dialogue between us. But as I have mentioned to you, we have proposed a
transaction that is so compelling for the stockholders of both of our
companies that we feel obligated to pursue it notwithstanding your
Board's rejection. Because we are confident that Clark's stockholders
will enthusiastically support our proposal, we are sending this letter
to you and also releasing it publicly.
Ingersoll-Rand Company proposes to acquire Clark in a merger transaction
in which Clark's stockholders would receive between $75.00 and $77.00 in
cash for each share of outstanding Clark common stock. We think the
lower end of that range is the appropriate price, but as you know we
have repeatedly offered to meet with you to give you the opportunity to
convince us that the higher end of that range is justified. We have been
studying Clark for some time and we are extremely impressed with the
businesses you have so ably built up and the manner in which they
complement Ingersoll-Rand's businesses. We believe the complementary
aspects of our two companies' products, customers and distribution
capabilities would enable the combined entity to be an even more
effective competitor in the global marketplace.
Our offer is subject to the negotiation and execution of a mutually
acceptable definitive merger agreement, the operation of Clark in the
ordinary course of business, the taking of the various actions by
Clark's Board necessary to facilitate the completion of the transaction
and the absence of any actions by Clark's Board which would frustrate
our offer. Our proposal also assumes Clark's consummation of the sale of
its 50% interest in VME to Volvo on substantially the terms previously
announced or, if not consummated, the continued effectiveness of Clark's
announced agreement with Volvo without any change in its terms.
Our antitrust counsel has studied the two companies' businesses and we
do not believe that our proposal gives rise to any meaningful antitrust
concerns. We are confident that any antitrust issues would readily be
resolved. Finally, based on our discussions with our senior lenders, we
are also confident that the necessary financing for the transaction can
easily be arranged.
I still would like to meet with you at your earliest convenience to
discuss our proposal and to proceed with negotiations leading to the
execution of a definitive merger agreement.
We believe that your Board of Directors should reconsider our proposal
and view it as we do--as a unique opportunity for Clark's stockholders
to realize full value for their shares in a transaction that can quickly
be consummated.
26
<PAGE>
We hope to hear from you promptly.
Sincerely,
James E. Perrella
Later in the evening on March 28, 1995, the Company issued the following
press release:
South Bend, Ind. (March 28, 1995)--Clark Equipment Company said
today that its Board of Directors met on March 27, 1995 to review a
letter received from Ingersoll-Rand proposing an acquisition of the
company. After consulting with Clark's financial and legal advisors, the
Board of Directors unanimously determined to decline Ingersoll-Rand's
unsolicited proposal. The Board reaffirmed its long standing position
that Clark is not for sale and its commitment to implement successfully
its strategic plan. This plan has included the recent acquisitions of
Club Car and Blaw-Knox and the impending divestiture of its 50 percent
interest in VME Group for $573 million.
Clark Chairman Leo J. McKernan stated that Ingersoll-Rand's proposal
is entirely inadequate. "Clark's share price reached a high of $71 only
five months ago. I believe this is an opportunistic attempt to buy Clark
during a temporary decline in the price of Clark's shares," added Mr.
McKernan. (A copy of McKernan's letter to James E. Perrella, Chairman,
President and CEO of Ingersoll-Rand, declining the offer follows.)
Clark's press release then included the text of the March 27 Clark Letter
set forth above.
On March 29, 1995, the Company filed suit against the Parent in the United
States District Court for the Southern District of New York alleging that the
acquisition by the Parent of the Company would violate the federal antitrust
laws and seeking preliminary and permanent injunctions barring the Parent from
proceeding with the acquisition. See Section 15 for additional information about
this suit.
On March 30, 1995, the Parent issued the following press release:
Woodcliff Lake, N.J. (March 28, 1995)--Ingersoll-Rand Company said
it had been sued by Clark Equipment Company in Federal District Court in
New York City. The suit alleges that Ingersoll-Rand's proposed
acquisition of Clark violates the U.S. antitrust laws because of overlap
between the two companies in the manufacture and distribution of asphalt
pavers.
Thomas F. McBride, Senior Vice President and Chief Financial
Officer, said: "Clark's lawsuit is nothing more than a diversionary
tactic. Clark knows as well as we do that any antitrust issues which may
arise from the paver overlap between our two companies can readily be
resolved. Ingersoll-Rand's 1994 domestic revenues from the relevant
product line were below $10 million out of 1994 total revenues of $4.5
billion."
27
<PAGE>
On March 31, 1995, the Parent sent to the Company a demand under Delaware
law for the Company's list of stockholders and security position listings.
On April 3, 1995, the Purchaser commenced the Offer and the Parent delivered
a notice to the Company nominating seven individuals for election as directors
at the Company's annual meeting of stockholders scheduled for May 9, 1995. On
April 3, 1995, Mr. Perrella also sent the following letter to Mr. McKernan:
April 3, 1995
Mr. Leo J. McKernan
Chairman, President and Chief Executive Officer
Clark Equipment Company
100 North Michigan Street
South Bend, Indiana 46634
Dear Leo:
Over the past two and a half weeks, Ingersoll-Rand has made repeated
efforts to meet with Clark in an attempt to negotiate the terms of a
merger transaction that could be presented to Clark's stockholders as
the joint effort of both companies' Boards and managements. But rather
than recognize its fiduciary responsibility to explore further a
possible transaction on the basis we have proposed, the only response
from Clark has been to state its long-standing position that Clark is
not for sale and to file a lawsuit against us.
The Company's actions leave us with only one alternative. Today we are
commencing a tender offer to acquire all outstanding shares of Clark
common stock at $77.00 in cash per share and we are sending a letter
notifying you that we are nominating seven individuals for election as
directors of Clark at Clark's May 9 annual meeting of stockholders.
We regret that we have to resort to these actions; we would have greatly
preferred to enter into negotiations with you in an effort to reach
agreement on a merger transaction. But even though we have commenced a
tender offer, we continue to be interested in meeting with you to
negotiate the terms of a transaction that can be approved by your Board.
When your Board recognizes that its fiduciary duties require
consideration of the sale of Clark, please call me.
Sincerely,
James E. Perrella
Chairman, President and Chief Executive Officer
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11. PURPOSE OF THE OFFER; THE MERGER; PLANS FOR THE COMPANY. The purpose of
the Offer is to acquire control of, and the entire equity interest in, the
Company.
The Merger. The Purchaser intends to propose, and to seek to have the
Company consummate, the Merger as soon as practicable after consummation of the
Offer. However, certain terms of the Rights and certain provisions of the DGCL,
the Charter and the By-Laws may affect the ability of the Purchaser to obtain
control of the Company and to consummate the Merger. Accordingly, the timing and
details of the Merger will depend on a variety of factors and legal
requirements, the actions of the Board of Directors of the Company, the number
of Shares acquired by the Purchaser pursuant to the Offer and whether the
Minimum Condition, the Supermajority Charter Condition, the Rights Condition and
the Delaware Takeover Statute Condition have been satisfied.
Board Approval. Except in the case of a short form merger in accordance with
the DGCL described below, the DGCL requires that the Merger be approved by the
Company's Board of Directors. As described above, the Parent and the Purchaser
have previously requested and continue to request that the Company's Board of
Directors approve the Merger and believe that the Company's Board of Directors
is obligated by its fiduciary responsibilities to do so. On April 3, 1995, the
Parent delivered a notice to the Company nominating seven individuals for
election as directors at the Company's annual meeting of stockholders scheduled
for May 9, 1995. The Parent intends to solicit proxies from stockholders for the
purpose of electing the seven director candidates nominated by the Parent, in
order that the new Board of Directors would take all such actions necessary or
appropriate (subject to such directors' fiduciary duties) to approve and
effectuate the consummation of the Offer and the Merger, including taking action
to execute an agreement and plan of merger and to satisfy the Supermajority
Charter Condition, the Rights Condition and the Delaware Takeover Statute
Condition. If the seven director candidates nominated by the Parent are not
elected at the annual meeting and the conditions to the Offer are not otherwise
satisfied, the Parent will explore the other options available to it, including
soliciting stockholder demands to call a special meeting of the Company's
stockholders for the purpose of electing candidates nominated by the Parent as
directors of the Company, adopting resolutions of stockholders instructing the
Board of Directors of the Company to approve the Offer and the Merger or taking
other actions to insure that the Offer and the Merger will be consummated. Under
the Charter and By-Laws, the Company is required to call a special meeting of
the stockholders upon the demand of the holders of a majority of the outstanding
Shares. The Parent and the Purchaser may also consider the possible commencement
of litigation seeking to eliminate obstacles to the consummation of the Offer
and the Merger.
There are currently seven members of the Company's Board of Directors. The
directors are elected to the Board of Directors for a term of one year at each
annual meeting of the Company. The DGCL provides that any director, or the
entire Board of Directors, may be removed from office by the affirmative
majority vote of the outstanding Shares entitled to vote for directors. The
vacancy caused by any such removal may be filled at such meeting by the vote of
the holders of a plurality of the Shares present in person or by proxy and
entitled to vote, except that any vacancy not so filled may be filled by a
majority of the remaining directors.
Under the DGCL, the amendment of any provision of the Charter requires a
resolution of the Board of Directors and the affirmative vote of a majority of
the outstanding Shares entitled to vote, except that the Charter provides that
the Supermajority Charter Provision may not be amended without the affirmative
vote or consent of 80% of the Shares entitled to vote in elections of directors.
The By-Laws provide that they may be amended by the stockholders or Board of
Directors at a meeting with notice duly given of the proposed amendment or by
unanimous written consent of the Board of Directors.
If all the conditions to the Offer are satisfied even though the Company's
Board of Directors does not take the actions requested by the Purchaser to
approve the Offer and the Merger, and if the Parent
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is unsuccessful in seeking election of the seven director candidates nominated
by the Parent to the Company's Board of Directors at the upcoming annual
meeting, then the Parent and the Purchaser presently intend to request as soon
as practicable following consummation of the Offer that some or all of the
then-current members of the Board of Directors resign and to cause nominees of
the Parent or the Purchaser to be elected to fill the resulting vacancies.
Should such request be refused, the Parent and the Purchaser intend to take such
action as may be necessary and lawful to secure control of the Board of
Directors of the Company. Such action may include calling a special meeting of
the stockholders of the Company, which the Purchaser will have the power to
effect without the action of any other stockholder as a result of it having
acquired a majority of the outstanding Shares through consummation of the Offer.
In the event the Purchaser obtains control of the Company's Board of Directors,
the Purchaser would expect to seek approval of the Merger as soon as practicable
thereafter, consistent with the fiduciary obligations of the Board.
THIS OFFER TO PURCHASE DOES NOT CONSTITUTE A SOLICITATION OF A PROXY,
CONSENT OR AUTHORIZATION FOR OR WITH RESPECT TO THE ANNUAL MEETING OR ANY
SPECIAL MEETING OF THE COMPANY'S STOCKHOLDERS OR ANY ACTION IN LIEU THEREOF. ANY
SUCH SOLICITATION WHICH THE PURCHASER MAY MAKE WILL BE MADE ONLY PURSUANT TO
SEPARATE PROXY MATERIALS IN COMPLIANCE WITH THE REQUIREMENTS OF SECTION 14(A) OF
THE EXCHANGE ACT.
Stockholder Approval. The DGCL requires that unless otherwise provided by
the Company's Charter, the Merger be approved by the affirmative vote of the
holders of at least a majority of the outstanding Shares. The Minimum Condition
requires that there shall have been validly tendered and not properly withdrawn
on or prior to the Expiration Date a number of Shares which, together with the
Shares owned by the Parent, constitutes at least 51% of the voting power
(determined on a fully diluted basis) on the date of purchase of all securities
entitled to vote generally in the election of directors or in a merger. Upon
consummation of the Offer and assuming the Minimum Condition is satisfied, the
Purchaser will own sufficient Shares to enable it to effect stockholder approval
of the Merger (subject to the requirements of the Supermajority Charter
Provision and the Delaware Takeover Statute) with the affirmative vote of the
Shares owned by it.
THE OFFER IS CONDITIONED UPON THE MINIMUM CONDITION BEING SATISFIED.
Supermajority Charter Provision. The Charter provides that, in addition to
any affirmative vote required by applicable law, the affirmative vote of the
holders of at least 80% of the outstanding Shares is required to approve certain
business combinations (including the Merger) between the Company and an
Interested Stockholder, unless prior to such person becoming an Interested
Stockholder the Company's Board of Directors shall by resolution have approved a
memorandum of understanding or a letter of intent with respect to such business
combination. The Supermajority Charter Condition requires that the Purchaser
shall be satisfied, in its sole discretion, that the supermajority stockholder
vote specified in the Supermajority Charter Provision would not (as a result of
action by the Company's Board of Directors or otherwise) be required prior to
the consummation of the Merger or that the Purchaser will acquire a sufficient
number of Shares to insure a vote in favor of the Merger under such provision.
The Purchaser is hereby requesting that the Company's Board of Directors
adopt a resolution approving a memorandum of understanding or a letter of intent
with respect to the Merger for purposes of the Supermajority Charter Provision.
The Purchaser believes that under the circumstances of the Offer and under
applicable law, the Board of Directors of the Company is obligated by its
fiduciary responsibilities to so approve the Merger in order to permit the Offer
and the Merger to be consummated. However, there can be no assurance that the
Board will do so. If the Board does not so approve the Merger but upon
consummation of the Offer the Purchaser and the Parent together own at least 80%
of the outstanding Shares, then the Purchaser and the Parent will own sufficient
Shares to enable them to satisfy the Supermajority Charter Provision and effect
stockholder approval of the Merger (subject to the requirements of the Delaware
Takeover Statute).
THE OFFER IS CONDITIONED UPON THE SUPERMAJORITY CHARTER CONDITION BEING
SATISFIED.
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The foregoing description of the Charter and the By-Laws is qualified in its
entirety by reference to the text of the Charter and By-Laws, copies of which
have been filed by the Company as exhibits to documents filed with the
Commission and may be obtained in the manner described in Section 7.
The Rights. The following discussion is based on information contained in
the September 1990 Form 10-Q. Although the Purchaser and the Parent do not have
any knowledge (except as otherwise described herein) that would indicate that
any statements contained herein based upon such document are untrue, neither the
Purchaser nor the Parent assumes any responsibility for the accuracy or
completeness of the information contained in such document, 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 which are unknown to the
Purchaser and the Parent.
On March 10, 1987, the Board of Directors of the Company, declared a
dividend distribution of one Right for each outstanding Share to the
stockholders of record at the close of business on March 20, 1987 (the "Record
Date"). Each Right entitles the registered holder to purchase from the Company a
unit consisting of one one-hundredth of a share (a "Unit") of Series A Junior
Participating Preferred Stock, $1.00 par value (the "Preferred Stock"), at a
Purchase Price of $80 per Unit, subject to adjustment. On March 20, 1987, each
outstanding Share received one Right. As long as the Rights are attached to the
Shares, the Company will issue one Right for each Share issued between the
Record Date and the Distribution Date so that all such Shares will have attached
Rights.
Initially, Rights are attached to all Share Certificates outstanding and no
separate Right Certificates are distributed. A "Distribution Date" for the
Rights will occur upon the earlier of (i) the fifteenth day after the Stock
Acquisition Date or (ii) the tenth business day (or such later date as may be
determined by the Board of Directors) after the date of the commencement of a
tender offer or exchange offer if upon consummation thereof the person or group
proposing such offer would be the beneficial owner of 30% or more of the
outstanding Shares.
Until the Distribution Date, the Rights will be transferred with and only
with Share Certificates and new Share Certificates issued upon transfer or new
issuances of Shares after March 20, 1987 until the Distribution Date (or earlier
redemption or expiration of the Rights) will contain a notation incorporating
the Rights Agreement by reference. Until the Distribution Date (or earlier
redemption or expiration of the Rights), the surrender for transfer of any Share
Certificate will also constitute the transfer of the Rights associated with the
Shares represented by such Share Certificate.
The Rights are not exercisable until the Distribution Date (or the
expiration of the Company's redemption rights, as described below) and will
expire on March 20, 1997, unless earlier redeemed by the Company as described
below.
As soon as practicable following the Distribution Date, separate Rights
Certificates will be mailed to holders of record of the Shares as of the close
of business on the Distribution Date. After the Distribution Date, such separate
Rights Certificates alone will evidence the Rights.
In the event that at any time following the Distribution Date a person
(other than the Company, any subsidiary of the Company or any employee benefit
plan of the Company or any of its subsidiaries) becomes the beneficial owner of
20% or more of the then outstanding Shares (the "Ownership Flip-In"), each
holder of a Right will thereafter have the right to purchase, upon exercise
thereof at the Purchase Price, Shares which have a market value of two times the
Purchase Price. However, such right will not be triggered if a majority of
Independent Directors determine, after receiving advice from one or more
investment banking firms, that the acquisition of Shares which would cause an
Acquiring Person to become such was pursuant to a tender or exchange offer for
all outstanding Shares at a price and on terms which such majority of
Independent Directors determines to be fair and otherwise in the best interests
of the Company and its stockholders (the "Approved Tender Offer Exception").
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In the event that at any time following the Stock Acquisition Date the
Company is involved in a merger or other business combination transaction in
which it is not the continuing or surviving corporation or in which any or all
of the Shares are changed into or exchanged for securities of another party or
cash or other property or 50% or more of the Company's assets or earning power
is sold (the "Flip-Over"), each holder of a Right will thereafter have the right
to purchase, upon the exercise thereof at the Purchase Price, common stock of
the acquiring entity or parent thereof which has a value of two times the
Purchase Price, subject to the same Approved Tender Offer Exception.
Following the occurrence of an Ownership Flip-In or Flip-Over, any Rights
beneficially owned by an Acquiring Person or its affiliates or associates will
immediately become null and void.
The Purchase Price payable and the number of Shares or other securities or
property issuable upon exercise of Rights are subject to adjustment from time to
time to prevent dilution (i) in the event of a stock dividend on or a
subdivision, combination or reclassification of the Preferred Stock or the
Shares, (ii) upon the grant to holders of the Preferred Stock of certain rights
or warrants to subscribe for Preferred Stock or convertible securities at less
than the current market price of the Preferred Stock or (iii) upon the
distribution to holders of the Preferred Stock of evidences of indebtedness or
assets (excluding dividends payable in Preferred Stock) or cash (excluding
regular quarterly cash dividends) or of subscription rights or warrants (other
than those referred to above).
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
the Purchase Price. No fractional Units will be issued and in lieu thereof an
adjustment in cash will be made based on the market price of the Preferred Stock
on the last trading date prior to the date of issuance of a Right.
At any time until the fifteenth day following the Stock Acquisition Date,
the Company may redeem the Rights in whole but not in part at a price (the
"Redemption Price") of $.05 per Right, subject to adjustment. The concurrence of
a majority of the Continuing Directors (as defined below) is required to redeem
the Rights if the redemption occurs (i) on or after a time a person becomes an
Acquiring Person or (ii) on or after the date of a change (resulting from a
proxy or consent solicitation) in a majority of the directors in office at the
commencement of such solicitation if any person who is a participant in such
solicitation is or might become an Acquiring Person unless, concurrent with such
solicitation, such person (or one or more of its affiliates or associates) is
making a cash tender offer for all shares of common stock not beneficially owned
by such person (or by its affiliates and associates) (the "Cash Tender Offer
Exception"). The term "Continuing Director" means any member of the Company's
Board of Directors who was a member of the Board prior to the date of the Rights
Agreement or has been subsequently elected to the Board if such person was
recommended or approved by a majority of the Continuing Directors, but does not
include an Acquiring Person or any representative thereof. Because the Purchaser
is making a cash tender offer for all outstanding Shares, it believes that the
Cash Tender Offer Exception applies and thus the redemption of the Rights
following the election of its nominees to the Board of Directors of the Company
will not require the concurrence of a majority of the Continuing Directors.
Immediately upon the action of the Board of Directors of the Company
ordering redemption of the Rights, the Rights will terminate and the only right
of the holders of Rights will be to receive the Redemption Price. Rights will
not be exercisable prior to the expiration of the Company's right of redemption
described above.
Until a Right is exercised, it will not entitle the holder thereof to any
rights as a stockholder of the Company, including without limitation the right
to vote or to receive dividends. The terms of the Rights other than certain
provisions relating to the principal economic terms of the Rights may be amended
by the Board of Directors of the Company, but after any person becomes an
Acquiring Person in certain circumstances the concurrence of the Continuing
Directors will be required to amend the Rights.
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Under the Rights Agreement, as a result of the commencement of the Offer,
the Distribution Date will be as early as April 17, 1995, unless prior to such
date the Company's Board of Directors redeems the Rights or takes action to
delay the Distribution Date. The Purchaser believes that the consummation of the
Offer likely would trigger the Ownership Flip-In and as a result cause
significant dilution to the Purchaser's interest in the Company and render the
Offer and the Merger economically unattractive for the Purchaser.
The Rights Condition requires that the Rights shall have been redeemed by
the Company's Board of Directors or that the Purchaser shall be satisfied, in
its sole discretion, that the Rights have been invalidated or are otherwise
inapplicable to, or the dilutive provisions thereof will not be triggered by,
the Offer and the Merger. The Purchaser believes that under the circumstances of
the Offer and under applicable law, the Board of Directors of the Company is
obligated by its fiduciary responsibilities to redeem the Rights or take such
other action to invalidate the Rights or otherwise render the Rights
inapplicable to, or prevent the dilutive provisions thereof from being triggered
by, the Offer and the Merger, in each case in order to permit the Offer and the
Merger to be consummated. In addition, the Purchaser believes that under the
circumstances of the Offer and under applicable law, the Independent Directors
are obligated by their fiduciary responsibilities to make the determination that
the Offer is at a price and on terms fair to and otherwise in the best interests
of the Company and its stockholders. However, there can be no assurance that the
Board or a majority of the Independent Directors will take any such action.
The Purchaser is hereby requesting that the Company's Board of Directors
redeem the Rights or take such other action described above and that the
Company's Independent Directors make the determination described above.
UNLESS THE RIGHTS ARE REDEEMED, HOLDERS OF SHARES WILL ALSO BE REQUIRED TO
TENDER ONE RIGHT FOR EACH SHARE TENDERED IN ORDER TO EFFECT A VALID TENDER OF
SUCH SHARE. If separate certificates for the Rights are not issued, a tender of
Shares will also constitute a tender of associated Rights.
THE OFFER IS CONDITIONED UPON THE RIGHTS CONDITION BEING SATISFIED.
Delaware Takeover Statute. In general, the Delaware Takeover Statute
prohibits any person who is the beneficial owner of 15% or more of the
outstanding voting stock of a corporation from engaging in certain business
combinations (including the Merger) with such corporation for a period of three
years following the date on which such person became a Statutory Interested
Stockholder, unless: (i) either the transaction by which such person became a
Statutory Interested Stockholder or the business combination is approved by the
board of directors of the corporation prior to the date on which such person
became a Statutory Interested Stockholder; (ii) upon consummation of the
transaction which resulted in the stockholder becoming an Statutory Interested
Stockholder, the stockholder owned at least 85% of the voting stock outstanding
at the time the transaction commenced, excluding shares owned by (a) persons who
are both officers and directors of the corporation and (b) employee stock plans
in which employee participants do not have the right to determine confidentially
whether shares held subject to the plan will be tendered in a tender or exchange
offer; or (iii) subsequent to the date on which such person became a Statutory
Interested Stockholder, the business combination is approved by the board of
directors of the corporation and authorized by the affirmative vote, at a
meeting called for that purpose, of at least two-thirds of the outstanding
voting stock not beneficially owned by the Statutory Interested Stockholder or
any of its affiliates or associates or by persons who are either directors or
officers and also employees of the Statutory Interested Stockholder.
The Delaware Takeover Statute Condition will be satisfied if prior to the
acceptance for payment of Shares pursuant to the Offer, the Company's Board of
Directors approves the Offer and the Merger with respect to the Company or if
the Purchaser acquires 85% of the Eligible Voting Stock of the Company. The
Parent hereby requests that the Company's Board of Directors approve the Offer
and the Merger for all purposes, including the Delaware Takeover Statute. Under
the circumstances of the
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Offer and under applicable law, the Purchaser believes that the Board of
Directors of the Company is obligated by its fiduciary responsibilities to
approve, pursuant to the Delaware Takeover Statute, the acquisition of Shares
pursuant to the Offer and the Merger. However, there can be no assurance that
the Board of Directors will do so. If the Board does not so approve the Offer
and the Merger but upon consummation of the Offer the Purchaser and the Parent
together own at least 85% of the Eligible Voting Stock of the Company, then the
restrictions on business combinations contained in the Delaware Takeover Statute
would not be applicable.
THE OFFER IS CONDITIONED UPON THE DELAWARE TAKEOVER STATUTE CONDITION BEING
SATISFIED.
Short Form Merger. Under the DGCL and subject to the Delaware Takeover
Statute, a parent corporation owning at least 90% of the outstanding shares of
each class of a subsidiary corporation may merge the subsidiary corporation into
itself without the approval of the stockholders of the parent corporation or of
the board of directors or stockholders of the subsidiary corporation. In the
event that the Purchaser owns more than 90% of the Shares following the
consummation of the Offer and assuming that the Delaware Takeover Statute
Condition and the Rights Condition have been satisfied, the Purchaser may elect
to consummate a short form merger in accordance with the DGCL. If the Purchaser
does not own 90% or more of the Shares following consummation of the Offer, it
may seek to purchase additional Shares in the open market or otherwise in order
to reach the 90% threshold for the Shares.
Appraisal Rights in Connection with the Offer. Stockholders do not have
appraisal rights as a result of the Offer. However, if the Merger is
consummated, stockholders of the Company at the time of the Merger who do not
vote in favor of the Merger will have the right under the DGCL to dissent and
demand appraisal of, and receive payment in cash of the fair value of, their
Shares outstanding immediately prior to the effective date of the Merger in
accordance with Section 262 of the DGCL.
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 such merger or similar business combination)
and to receive payment of such fair value in cash. Any such judicial
determination of the fair value of such Shares could be based upon
considerations other than or in addition to the price paid in the Offer and 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 or other similar business
combination.
In addition, several decisions by Delaware courts have held that in certain
circumstances a controlling stockholder of a corporation involved in a merger
has a fiduciary duty to other stockholders that requires that the merger be fair
to other stockholders. In determining whether a merger is fair to minority
stockholders, Delaware courts have considered, among other things, the type and
amount of the consideration to be received by the stockholders and whether there
was fair dealing among the parties. The Delaware Supreme Court stated in
Weinberger and Rabkin v. Philip A. Hunt Chemical Corp. that the remedy
ordinarily available to minority stockholders in a cash-out merger is the right
to appraisal described above. However, a damages remedy or injunctive relief may
be available if a merger is found to be the product of procedural unfairness,
including fraud, misrepresentation or other misconduct.
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THE FOREGOING SUMMARY OF THE RIGHTS OF OBJECTING STOCKHOLDERS DOES NOT
PURPORT TO BE A COMPLETE STATEMENT OF THE PROCEDURES TO BE FOLLOWED BY
STOCKHOLDERS DESIRING TO EXERCISE ANY AVAILABLE APPRAISAL RIGHTS. THE
PRESERVATION AND EXERCISE OF APPRAISAL RIGHTS REQUIRE STRICT ADHERENCE TO THE
APPLICABLE PROVISIONS OF THE DELAWARE LAW.
The foregoing description of the DGCL is not necessarily complete and is
qualified in its entirety by reference to the DGCL.
Rule 13e-3. The Commission has adopted Rule 13e-3 under the Exchange Act
which is applicable to certain "going private" transactions and which may under
certain circumstances be applicable to the Merger following the purchase of
Shares pursuant to the Offer in which the Purchaser seeks to acquire any
remaining Shares. Rule 13e-3 should not be applicable to the Merger if the
Merger is consummated within one year after the expiration or termination of the
Offer and the price paid in the Merger is not less than the per Share price paid
pursuant to the Offer. However, in the event that the Purchaser is deemed to
have acquired control of the Company pursuant to the Offer and if the Merger is
consummated more than one year after completion of the Offer or an alternative
acquisition transaction is effected whereby stockholders of the Company receive
consideration less than that paid pursuant to the Offer, in either case at a
time when the Shares are still registered under the Exchange Act, the Purchaser
may be required to comply with Rule 13e-3 under the Exchange Act. If applicable,
Rule 13e-3 would require, among other things, that certain financial information
concerning the Company and certain information relating to the fairness of the
Merger or such alternative transaction and the consideration offered to minority
stockholders in the Merger or such alternative transaction, be filed with the
Commission and disclosed to stockholders prior to consummation of the Merger or
such alternative transaction. The purchase of a substantial number of Shares
pursuant to the Offer may result in the Company being able to terminate its
Exchange Act registration. See Section 13. If such registration were terminated,
Rule 13e-3 would be inapplicable to any such future Merger or such alternative
transaction.
Other. The timing and details of the Merger will depend on a variety of
factors and legal requirements, the action of the Company's Board of Directors
and the number of Shares acquired by the Purchaser pursuant to the Offer and
whether the Minimum Condition, the Supermajority Charter Condition, the Rights
Condition and the Delaware Takeover Statute Condition are satisfied or waived.
Although the Purchaser has proposed the Merger to the Company and seeks to have
the Company consummate the Merger as soon as practicable after consummation of
the Offer, the Purchaser can give no assurance that the Merger will be
consummated or as to the timing of the Merger if it is consummated. Although the
Purchaser has proposed the Merger on the terms described above, it is possible
that as a result of substantial delays in the Purchaser's ability to effect the
Merger, information hereafter obtained by the Purchaser, changes in general
economic or market conditions or in the business, operations or financial
condition or prospects of the Company, any of the Minimum Condition, the
Supermajority Charter Condition, the Rights Condition and/or the Delaware
Takeover Statute Condition not being satisfied or any other currently unforeseen
factors, the Merger may not be so proposed, may be delayed or abandoned or may
be proposed on different terms. Although it has no current intention to do so,
the Purchaser expressly reserves the right to propose a Merger on terms other
than those described above and the right to withdraw any Merger proposal.
The Purchaser reserves the right to purchase, following consummation or
termination of the Offer, additional Shares or Rights in the open market, in
privately negotiated transactions, in another tender offer or exchange offer or
otherwise. In addition, in the event that the Purchaser decides not to propose
the Merger, to propose a Merger on terms other than those described above or to
withdraw any Merger previously proposed, the Purchaser will evaluate its other
alternatives. Such alternatives could include purchasing additional Shares or
Rights in the open market, in privately negotiated transactions, in another
tender offer or exchange offer or otherwise, or taking no further action to
acquire additional Shares or Rights. Any additional purchases of Shares or
Rights could be at a price greater or less than the price to be paid for Shares
and Rights in the Offer and could be for cash or other consideration.
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Alternatively, the Purchaser and the Parent may sell or otherwise dispose of any
or all Shares or Rights acquired pursuant to the Offer or otherwise. Such
transactions may be effected on terms and at prices then determined by the
Purchaser and the Parent, which may vary from the price paid for Shares and
Rights in the Offer.
Plans for the Company. The Parent does not have any current plans to dispose
of any businesses or other assets of the Company or to effect any changes in its
operations, except that it will consider possible changes in the Company's
headquarters operations. If the Parent acquires control of the Company, it
intends to conduct a further review of the Company and its subsidiaries and
their respective assets, businesses, corporate structure, capitalization,
operations, properties, policies, management and personnel. After such review,
it is possible that the Parent might modify its current plans not to dispose of
any businesses or other assets of the Company and not to effect any changes in
the Company's operations other than as described above.
Except as described in this Offer to Purchase, none of the Purchaser, the
Parent nor, to the best knowledge of the Purchaser and the Parent, any of the
persons listed on Schedule I have any present plans or proposals that would
relate to or result in an extraordinary corporate transaction such as a merger,
reorganization or liquidation involving the Company or any of its subsidiaries
or a sale or other transfer of a material amount of assets of the Company or any
of its subsidiaries, any material change in the capitalization or dividend
policy of the Company or any other material change in the Company's corporate
structure or business or the composition of its Board of Directors or
management.
12. DIVIDENDS AND DISTRIBUTIONS. If the Company should, during the pendency
of the Offer, split, combine or otherwise change the Shares or its
capitalization, or disclose that it has taken any such action, then without
prejudice to the Purchaser's rights under Section 14, the Purchaser may make
such adjustments to the purchase price and other terms of the Offer as it deems
appropriate to reflect such split, combination or other change.
If on or after March 15, 1995 (except to the extent publicly disclosed by
the Company with specificity in documents filed with the Commission prior to
March 31, 1995), the Company should declare or pay any cash or stock dividend or
other distribution on, or issue any rights with respect to, the Shares that is
payable or distributable to stockholders of record on a date prior to the
transfer to the name of the Purchaser or the nominee or transferee of the
Purchaser on the Company's stock transfer records of such Shares that are
purchased pursuant to the Offer (except that if the Rights are redeemed by the
Board of Directors in accordance with the terms of the Rights Agreement,
tendering stockholders who are holders of record as of the applicable record
date will be entitled to receive and retain the redemption price of $.05 per
Right in accordance with the Rights Agreement), then without prejudice to the
Purchaser's rights under Section 14, (i) the purchase price payable per Share by
the Purchaser pursuant to the Offer will be reduced to the extent any such
dividend or distribution is payable in cash and (ii) any non-cash dividend,
distribution (including additional Shares) or right received and held by a
tendering stockholder shall be required to be promptly remitted and transferred
by the tendering stockholder to the Depositary for the account of the Purchaser,
accompanied by appropriate documentation of transfer. Pending such remittance or
appropriate assurance thereof, the Purchaser will, subject to applicable law, be
entitled to all rights and privileges as owner of any such non-cash dividend,
distribution or right and may withhold the entire purchase price or deduct from
the purchase price the amount or value thereof, as determined by the Purchaser
in its sole discretion.
13. EFFECT OF THE OFFER ON THE MARKET FOR THE SHARES, STOCK EXCHANGE LISTING
AND EXCHANGE ACT REGISTRATION. The purchase of Shares pursuant to the Offer will
reduce the number of Shares that might otherwise trade publicly and will reduce
the number of holders of Shares. This could adversely affect the liquidity and
market value of the remaining Shares held by the public. Depending upon the
number of Shares purchased pursuant to the Offer, the Shares may no longer meet
the requirements for continued listing on the NYSE and may therefore be delisted
from the NYSE. According to the NYSE's published guidelines, the NYSE would
consider delisting the Shares if, among other things: (i) the
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number of record holders of 100 or more Shares should fall below 1,200; (ii) the
number of publicly held Shares (exclusive of holdings of the Parent and the
Purchaser and any other subsidiaries or affiliates of the Parent and of officers
or directors of the Company or their immediate families or other concentrated
holdings of 10% or more ("Excluded Holdings")) should fall below 600,000; or
(iii) the aggregate market value of such publicly held Shares (exclusive of
Excluded Holdings) should fall below $5,000,000.
According to the 1994 Annual Report, as of December 31, 1994 there were
2,076 holders of record of Shares. 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 and prices for such Shares could be adversely affected.
If the NYSE were to delist the Shares, it is possible that such Shares would
continue to trade on other securities exchanges or in the over-the-counter
market and that price quotations would be reported by such exchanges or through
the National Association of Securities Dealers Automated Quotation System
("NASDAQ") or other sources. However, the extent of the public market for the
Shares and the availability of such quotations would depend upon such factors as
the number of stockholders and/or the aggregate market value of the Shares
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. The Purchaser cannot 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.
The Shares are currently "margin securities" under the rules of the Board of
Governors of the Federal Reserve System (the "Federal Reserve Board"), which has
the effect, among other things, of allowing brokers to extend credit on the
collateral of such Shares for the purpose of buying, carrying, or trading in
securities ("purpose loans"). Depending upon factors similar to those described
above with respect to stock exchange listing and market quotations, the Shares
might no longer constitute "margin securities" for the purposes of the Federal
Reserve Board's margin regulations and therefore could no longer be used as
collateral for purpose loans made by brokers.
The Shares, along with certain of the Company's other securities, are
currently registered under the Exchange Act. The purchase of Shares pursuant to
the Offer may result in the Shares becoming eligible for deregistration under
the Exchange Act. Registration of the Shares may be terminated upon application
of the Company to the Commission if the Shares are not listed on a national
securities exchange and there are fewer than 300 record holders. The termination
of the registration of the Shares under the Exchange Act would substantially
reduce the information required to be furnished by the Company to holders of the
Shares and would make certain provisions of the Exchange Act, such as the
short-swing profit recovery provisions of Section 16(b), the requirement of
furnishing a proxy statement in connection with stockholders' meetings and the
requirements of Rule 13e-3 under the Exchange Act with respect to "going
private" transactions, no longer applicable to the Shares. Furthermore,
"affiliates" of the Company and persons holding "restricted securities" of the
Company may be deprived of the ability to dispose of the securities pursuant to
Rule 144 under the Securities Act of 1933. If registration of the Shares under
the Exchange Act were terminated, the Shares would no longer be "margin
securities" or eligible for NASDAQ reporting. The Purchaser intends to seek to
cause the Company to terminate the registration of the Shares as soon after the
consummation of the Offer or Merger as the requirements for termination of
registration are met.
14. 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 Commission, including Rule
14e-l(c) 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 any Shares or Rights tendered pursuant to the Offer, and may
postpone the acceptance for payment or, subject to the restriction referred to
above, payment for any Shares or Rights tendered
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pursuant to the Offer, and may amend or terminate the Offer (whether or not any
Shares have theretofore been purchased or paid for) if, in the sole judgment of
the Purchaser, the Minimum Condition, the Supermajority Charter Condition, the
Rights Condition or the Delaware Takeover Statute Condition shall not have been
satisfied or if, at any time on or after March 15, 1995 and prior to the
acceptance for payment of or payment for Shares, any one or more of the events
listed below shall have occurred or shall be determined by the Parent or the
Purchaser to have occurred (except for any such events occurring between March
15, 1995 and March 31, 1995 which shall have been publicly disclosed prior to
March 31, 1995):
(a) there shall have been threatened, instituted or pending any action,
proceeding, claim or application by any government or governmental
regulatory or administrative authority or agency, domestic, foreign or
supranational, or by any other person, domestic or foreign, before any court
or governmental, regulatory or administrative agency, authority or tribunal,
domestic, foreign or supranational, that (i) challenges or seeks to make
illegal, to delay or otherwise directly or indirectly to restrain or
prohibit, or which is likely to impose, in the sole judgment of the
Purchaser, voting, procedural, price or other requirements in addition to
those required by the provisions of the DGCL described in Section 11 and
federal securities law in connection with the acquisition of Shares by the
Purchaser or any of its affiliates, the making of the Offer, the acceptance
for payment of or payment for Shares by the Purchaser or any of its
affiliates or the consummation of the Merger or any other business
combination involving the Company or the performance of any of the contracts
or other arrangements entered into by the Purchaser or any of its affiliates
in connection with the acquisition of the Company, seeking to obtain any
material damages as a result thereof or otherwise directly or indirectly
relating to the Offer or the Merger or such other business combination, (ii)
seeks to restrain, prohibit or limit the exercise of full rights of
ownership or operation by the Purchaser or any of its affiliates of all or
any portion of the business or assets of the Company or any of its
subsidiaries or the Purchaser or any of its affiliates or to compel the
Purchaser or any of its affiliates to dispose of or to hold separately all
or any portion of the business or assets of the Company or any of its
subsidiaries or the Purchaser or any of its affiliates, (iii) seeks to
impose or confirm limitations on the ability of the Purchaser or any of its
affiliates effectively to acquire or hold or to exercise full rights of
ownership of Shares, including without limitation the right to vote the
Shares acquired or owned by the Parent or the Purchaser or any of its
affiliates on all matters properly presented to the stockholders of the
Company, or the right to vote any shares of capital stock of any subsidiary
directly or indirectly owned by the Company, (iv) seeks to require
divestiture by the Parent or the Purchaser or any of its affiliates of any
Shares, (v) might result, in the sole judgment of the Purchaser, in a
diminution of the benefits expected to be derived by the Purchaser or any of
its affiliates as a result of the Offer or the Merger or any other business
combination involving the Company, or in a diminution of the value of the
Shares or the Company or any of its subsidiaries to the Purchaser or any of
its affiliates or (vi) challenges or adversely affects the financing of the
Offer or the Merger or any other business combination involving the Company;
or
(b) other than the application of the waiting periods under the HSR Act
and the necessity for the approvals and other actions by any domestic
(federal and state) or foreign or supranational governmental, administrative
or regulatory agency described in Section 15, there shall have been
proposed, sought, promulgated, enacted, entered, enforced or deemed
applicable to the Offer, the Merger or any other business combination
involving the Company, by any government or governmental, regulatory or
administrative agency or authority or by any court or tribunal, in each case
whether domestic, foreign or supranational, any statute, rule, regulation,
judgment, decree, decision, order or injunction that, in the sole judgment
of the Purchaser, might, directly or indirectly, result in any of the
consequences referred to in clauses (i) through (vi) of paragraph (a) above;
or
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(c) any change (or any condition, event or development involving a
prospective change) shall have occurred or been threatened in the business,
properties, assets, liabilities, stockholders' equity, financial condition,
capitalization, licenses, franchises, permits, operations, results of
operations or prospects of the Company or any of its subsidiaries or
affiliates (or the Purchaser shall have become aware thereof) or in general
economic or financial market conditions in the United States or abroad that,
in the sole judgment of the Purchaser, is or may be materially adverse to
the Company or any of its subsidiaries or affiliates, or the Purchaser shall
have become aware of any facts that, in the sole judgment of the Purchaser,
have or may have material adverse significance with respect to either the
value of the Company or any of its subsidiaries or affiliates or the value
of the Shares to the Parent or the Purchaser or any of its affiliates; or
(d) there shall have occurred (i) any general suspension of trading in,
or limitation on prices for, securities on any national securities exchange
or in the United States over-the-counter market, (ii) the declaration of a
banking moratorium or any suspension of payments in respect of banks in the
United States, (iii) any material adverse change (or any existing or
threatened condition, event or development involving a prospective material
adverse change) in United States or any other currency exchange rates or a
suspension of, or a limitation on, the markets therefor, (iv) any other
material adverse change in the market price of the Shares or in the United
States securities or financial markets generally, including without
limitation a decline of at least 15% in either the Dow Jones Average of
Industrial Stocks or the Standard & Poor's 500 index from April 3, 1995
through the date of termination or expiration of the Offer, (v) the
commencement of a war, armed hostilities or other international or national
calamity directly or indirectly involving the United States, (vi) any
limitation (whether or not mandatory) by any governmental authority or any
other event that, in the sole judgment of the Purchaser, may have material
adverse significance with respect to the extension of credit by banks or
other lending institutions or the financing of the Offer or the Merger or
any other business combination involving the Company or (vii) in the case of
any of the situations described in clauses (i) through (vi) above existing
at the time of the commencement of the Offer, a material acceleration or
worsening thereof; or
(e) a tender or exchange offer for some or all of the Shares shall have
been publicly proposed to be made or shall have been made by another person
(including the Company or any of its subsidiaries or affiliates), or it
shall have been publicly disclosed or the Purchaser shall have otherwise
deemed that (i) any person, entity (including the Company or any of its
subsidiaries or affiliates) or "group" (within the meaning of Section
13(d)(3) of the Exchange Act) shall have acquired or proposed to acquire
beneficial ownership of more than 10% of any class or series of capital
stock of the Company (including the Shares) through the acquisition of
stock, the formation of a group or otherwise, or shall have been granted any
option, right or warrant, conditional or otherwise, to acquire beneficial
ownership of more than 10% of any class or series of capital stock of the
Company (including the Shares) other than acquisitions for bona fide
arbitrage purposes only and other than as disclosed in a Schedule 13D or 13G
on file with the Commission prior to March 31, 1995, (ii) any such person,
entity or group which, prior to such date, had filed such a Schedule with
the Commission, shall have acquired or proposed to acquire, through the
acquisition of stock, the formation of a group or otherwise, beneficial
ownership of additional shares of any class or series of capital stock of
the Company (including the Shares) constituting 2% or more of any such class
or series, or shall have been granted any option, right or warrant,
conditional or otherwise, to acquire beneficial ownership of shares of any
class or series of capital stock of the Company (including the Shares)
constituting 2% or more of any such class or series, (iii) any person,
entity or group shall have entered into a definitive agreement or an
agreement in principle or made a proposal with respect to a tender or
exchange offer for some or all the Shares or a merger, consolidation or
other business combination with or involving the Company or any of its
subsidiaries or affiliates or (iv) any person, entity or group shall have
filed a Notification and Report Form under the HSR Act or made a public
announcement reflecting an intent to acquire
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the Company or any of its subsidiaries or any assets or securities of the
Company or any of its subsidiaries; or
(f) the Company or any of its subsidiaries shall have, directly or
indirectly, (i) split, combined or otherwise changed, or authorized or
proposed the split, combination or other change of, the Shares or its
capitalization, (ii) acquired or otherwise caused a reduction in the number
of, or authorized or proposed the acquisition or other reduction in the
number of, any outstanding Shares (other than as part of the repurchase of
up to 3,000,000 Shares under the Company Repurchase Plan announced by the
Company on February 3, 1995 (but only if each such repurchase is made at a
price per Share less than or equal to the purchase price per Share offered
hereby) and other than a redemption of the Rights in accordance with the
terms of the Rights Agreement as publicly disclosed to be in effect on March
15, 1995) or other securities of the Company or any subsidiary thereof,
(iii) issued, distributed or sold, or authorized, proposed or announced the
issuance, distribution or sale of, (A) any additional Shares, shares of any
other class or series of capital stock, other voting securities, or any
securities convertible into or exchangeable or exercisable for any of the
foregoing, or options, rights or warrants, conditional or otherwise, to
acquire any of the foregoing, except for the issuance of up to 7,738 Shares
assumed to be reserved for issuance prior to December 31, 1994 pursuant to
the exercise of then outstanding employee stock options, in accordance with
their terms or (B) any other securities or rights in respect of, in lieu of
or in substitution or exchange for any shares of its capital stock, (iv)
permitted the issuance or sale of any shares of any class of capital stock
or other debt or equity securities of any subsidiary of the Company or any
securities convertible into or exchangeable or exercisable for any of the
foregoing, (v) declared, paid or proposed to declare or pay any dividend or
other distribution, whether payable in cash, securities or other property,
on, or in respect of, any Shares (other than a distribution of the Rights
Certificates or a redemption of the Rights in accordance with the Rights
Agreement as publicly disclosed to be in effect on March 15, 1995), (vi)
altered or proposed to alter any material term of any outstanding security
of the Company or any of its subsidiaries (including the Rights), (vii)
issued, distributed or sold, or authorized or proposed the issuance,
distribution or sale of, any debt securities or securities convertible into
or exchangeable or exercisable for debt securities or any rights, warrants
or options entitling the holder thereof to purchase or otherwise acquire any
debt securities, or otherwise incurred, authorized or proposed the
incurrence of, any debt other than in the ordinary course of business and
consistent with past practice or any debt containing burdensome covenants,
(viii) authorized, recommended, proposed, effected or announced its
intention to engage in any merger (other than the Merger), consolidation,
liquidation, dissolution, business combination, acquisition (including by
way of exchange) of assets or securities, disposition (including by way of
exchange) of assets or securities, joint venture, any release or
relinquishment of any material contract or other rights of the Company or
any of its affiliates or any comparable event not in the ordinary course of
business, (ix) authorized, recommended, proposed or announced its intent to
enter into, or entered into any agreement or arrangement with any person,
entity or group that in the sole judgment of the Purchaser, has or may have
material adverse significance with respect to the value of the Company or
any of its affiliates, or the value of the Shares to the Purchaser or any of
its affiliates, (x) amended or proposed, adopted or authorized any amendment
(other than any amendment which provides that the Rights are inapplicable to
the Offer and the Merger) to the Charter or the By-Laws or similar
organizational documents of the Company or any of its subsidiaries or the
Rights Agreement or the Purchaser shall have learned that the Company or any
of its subsidiaries shall have proposed or adopted any such amendment which
shall not have been previously disclosed, (xi) entered into or amended any
employment, severance or similar agreement, arrangement or plan with or for
the benefit of any employee of the Company or any of its subsidiaries (other
than in the ordinary course of business) or so as to provide for increased
or accelerated benefits to employees as a result of or in connection with
the making of the Offer, the acceptance for payment of or payment for Shares
by the Purchaser or the consummation by the Purchaser or any of its
affiliates of the Merger or any other business combination involving
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the Company, (xii) except as may be required by law, taken any action to
terminate or amend any employee benefit plan (as defined in Section 3(2) of
the Employee Retirement Income Security Act of 1974, as amended) of the
Company or any of its affiliates, or the Purchaser shall have become aware
of any such action which shall not have been previously disclosed, or (xiii)
agreed in writing or otherwise to take any of the foregoing actions; or
(g) the Purchaser shall become aware (i) that any material contractual
right of the Company or any of its subsidiaries shall be impaired or
otherwise adversely affected or that any material amount of indebtedness of
the Company or any of its subsidiaries shall become accelerated or otherwise
become due or become subject to acceleration prior to its stated due date,
in each case with or without notice or the lapse of time or both, as a
result of or in connection with the Offer or the consummation by the
Purchaser or any of its affiliates of the Merger or any other business
combination involving the Company, (ii) of any covenant, term or condition
in any of the instruments or agreements of the Company or any of its
subsidiaries that, in the sole judgment of the Purchaser, is or may be
(whether considered alone or in the aggregate with other such covenants,
terms or conditions) materially adverse to either the value of the Company
or any of its subsidiaries (including without limitation any event of
default that may occur as a result of or in connection with the Offer, the
consummation by the Purchaser or any of its affiliates of the Merger or any
other business combination involving the Company) or the value of the Shares
to the Purchaser or any of its affiliates or the consummation by the
Purchaser or any of its affiliates of the Merger or any other business
combination involving the Company, or (iii) that any report, document,
instrument, financial statement or schedule of the Company filed with the
Commission contained, when filed, an untrue statement of a material fact or
omitted to state a material fact required to be stated therein or necessary
in order to make the statements made therein, in light of the circumstances
under which they were made, not misleading; or
(h) any waiting periods under the HSR Act applicable to the purchase of
Shares pursuant to the Offer shall not have expired or been terminated, or
any approval, permit, authorization or consent of any domestic or foreign or
supranational governmental, administrative or regulatory agency (federal,
state, local, provincial or otherwise) (including those described or
referred to in Section 15) which is required or believed to be appropriate
shall not have been obtained on terms satisfactory to the Parent in its sole
discretion; or
(i) (i) the Purchaser or any of its affiliates shall have entered into a
definitive agreement or announced an agreement in principle with respect to
the Merger or any other business combination with the Company or any of its
affiliates or the purchase of any material portion of the securities or
assets of the Company or any of its subsidiaries or (ii) the Purchaser or
any of its affiliates and the Company shall have agreed that the Purchaser
shall amend or terminate the Offer or postpone the payment for the Shares
pursuant thereto; or
(j) (i) the Company shall not have consummated the sale of its 50%
interest in VME for cash proceeds of not less than $573 million and (ii) the
definitive agreement to sell such interest to Volvo described in the
Company's Current Report on Form 8-K filed with the Commission on March 6,
1995 shall have been cancelled or terminated, or shall have been amended in
a manner that, or shall have been the subject of any other action that, in
the sole judgment of the Purchaser, is or may be adverse to the Company, or
shall otherwise no longer remain in full force and effect;
which, in the sole judgment of the Purchaser with respect to each and every
matter referred to above and regardless of the circumstances (including any
action or inaction by the Purchaser or any of its affiliates) giving rise to any
such condition, makes it inadvisable to proceed with the Offer or with such
acceptance for payment of or payment for Shares.
The foregoing conditions are for the sole benefit of the Purchaser and may
be waived by the Purchaser in whole or in part at any time and from time to time
in its sole discretion. Any determination by the Purchaser concerning the events
described above shall be final and binding upon all parties
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including tendering stockholders. The failure by the Purchaser at any time to
exercise any of the foregoing rights shall not be deemed a waiver of any such
right and each such right shall be deemed an ongoing right which may be asserted
at any time and from time to time.
A public announcement will be made of a material change in, or waiver of,
such conditions, to the extent required by Rules 14d-4(c) and 14d-6(d) under the
Exchange Act, and the Offer will be extended in connection with any such change
or waiver to the extent required by such rules.
15. CERTAIN LEGAL MATTERS AND REGULATORY APPROVALS. General. Except as set
forth below, based upon its examination of publicly available filings by the
Company with the Commission and other publicly available information concerning
the Company, neither the Purchaser nor the Parent is aware of any licenses or
other regulatory permits that appear to be material to the business of the
Company and its subsidiaries, taken as a whole, that might be adversely affected
by the Purchaser's acquisition of Shares (and the indirect acquisition of the
stock of the Company's subsidiaries) as contemplated herein, or of any filings,
approvals or other actions by or with any domestic (federal or state), foreign
or supranational governmental authority or administrative or regulatory agency
that would be required prior to the acquisition of Shares (or the indirect
acquisition of the stock of the Company's subsidiaries) by the Purchaser
pursuant to the Offer as contemplated herein. Should any such approval or other
action be required, it is the Purchaser's present intention to seek such
approval or action. However, the Purchaser does not presently intend to delay
the purchase of Shares tendered pursuant to the Offer pending the receipt of any
such approval or the taking of any such action (subject to the Purchaser's right
to delay or decline to purchase Shares if any of the conditions in Section 14
shall have occurred). There can be no assurance that any such approval or other
action, if needed, would be obtained without substantial conditions or that
adverse consequences might not result to the business of the Company, the Parent
or the Purchaser or that certain parts of the businesses of the Company, the
Parent or the Purchaser might not have to be disposed of or held separate or
other substantial conditions complied with in order to obtain such approval or
other action or in the event that such approval was not obtained or such other
action was not taken, any of which could cause the Purchaser to elect to
terminate the Offer without the purchase of the Shares thereunder. The
Purchaser's obligation under the Offer to accept for payment and pay for Shares
is subject to certain conditions, including conditions relating to the legal
matters discussed in this Section 15. See Section 14.
State Takeover Laws. A number of states have adopted takeover laws and
regulations which purport to varying degrees to be applicable to attempts to
acquire securities of corporations which are incorporated in such states or
which have or whose business operations have substantial economic effects in
such states, or which have substantial assets, security holders, principal
executive offices or principal places of business therein. To the extent that
certain provisions of certain of these state takeover statutes purport to apply
to the Offer, the Purchaser believes that such laws conflict with federal law
and constitute an unconstitutional burden on interstate commerce. In 1982, the
Supreme Court of the United States, in Edgar v. Mite Corp., invalidated on
constitutional grounds the Illinois Business Takeovers Act, which as a matter of
state securities law made takeovers of corporations meeting certain requirements
more difficult, and the reasoning in such decision is likely to apply to certain
other state takeover statutes. However, in 1987, in CTS Corp. v. Dynamics Corp.
of America, the Supreme Court of the United States held that the State of
Indiana could, as a matter of corporate law and in particular those aspects of
corporate law concerning corporate governance, constitutionally disqualify a
potential acquiror from voting on the affairs of a target corporation without
the prior approval of the remaining stockholders, provided that such laws were
applicable only under certain conditions. Subsequently, in TLX Acquisition Corp.
v. Telex Corp., a federal district court in Oklahoma ruled that the Oklahoma
statutes were unconstitutional insofar as they applied 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. In December 1988, a federal district court in Florida held in Grand
Metropolitan PLC v. Butterworth that the provisions of the Florida Affiliated
Transactions Act and the Florida Control Share Acquisition Act were
unconstitutional as applied to corporations incorporated outside of Florida.
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Except as described herein, the Purchaser has not attempted to comply with
any state takeover statutes in connection with the Offer. The Purchaser reserves
the right to challenge the validity or applicability of any state law allegedly
applicable to the Offer and nothing in this Offer to Purchase nor any action
taken in connection herewith is intended as a waiver of that right. In the event
that any state takeover statute is found applicable to the Offer, the Purchaser
might be unable to accept for payment or purchase Shares tendered pursuant to
the Offer or be delayed in continuing or consummating the Offer. In such case,
the Purchaser may not be obligated to accept for purchase, or pay for, any
Shares tendered. See Section 14.
Antitrust. Under the HSR Act and the rules that have been promulgated
thereunder by the FTC, certain acquisition transactions may not be consummated
unless certain information has been furnished to the Antitrust Division and the
FTC and certain waiting period requirements have been satisfied. The acquisition
of Shares pursuant to the Offer is subject to such requirements. See Section 2.
The Parent intends to file on the date hereof with the FTC and the Antitrust
Division a Premerger Notification and Report Form in connection with the
purchase of Shares pursuant to the Offer. Under the provisions of the HSR Act
applicable to the Offer, the purchase of Shares pursuant to the Offer may not be
consummated until the expiration of a 15-calendar day waiting period following
the filing by the Parent. Accordingly, the waiting period under the HSR Act
applicable to such purchases of Shares pursuant to the Offer will expire at
11:59 p.m., New York City time, on Tuesday, April 18, 1995, unless such waiting
period is extended by a request from the FTC or the Antitrust Division for
additional information or documentary material prior to the expiration of the
waiting period. If either the FTC or the Antitrust Division were to request
additional information or documentary material from the Parent, the waiting
period would expire at 11:59 p.m., New York City time, on the tenth calendar day
after the date of substantial compliance by the Parent with such request.
Thereafter, the waiting period could be extended only by court order. If the
acquisition of Shares is delayed pursuant to a request by the FTC or the
Antitrust Division for additional information or documentary material pursuant
to the HSR Act, the Offer may, but need not, be extended and in any event the
purchase of and payment for Shares will be deferred until ten days after the
request is substantially complied with, unless the waiting period is sooner
terminated by the FTC and the Antitrust Division. See Section 2. Only one
extension of such waiting period pursuant to a request for additional
information is authorized by the HSR Act and the rules promulgated thereunder,
except by court order. Any such extension of the waiting period will not give
rise to any withdrawal rights not otherwise provided for by applicable law. See
Section 4. Although the Company is required to file certain information and
documentary material with the Antitrust Division and the FTC in connection with
the Offer, neither the Company's failure to make such filings nor a request from
the Antitrust Division or the FTC for additional information or documentary
material made to the Company will extend the waiting period.
The FTC and the Antitrust Division frequently scrutinize the legality under
the antitrust laws of transactions such as the proposed acquisition of Shares by
the Purchaser pursuant to the Offer. At any time before or after the purchase by
the Purchaser of Shares pursuant to the Offer, either of the FTC and the
Antitrust Division could take such action under the antitrust laws as it deems
necessary or desirable in the public interest, including seeking to enjoin the
purchase of Shares pursuant to the Offer or seeking the divestiture of Shares
purchased by the Purchaser or the divestiture of substantial assets of the
Parent, its subsidiaries or the Company. Private parties and state attorneys
general may also bring legal action under federal or state antitrust laws under
certain circumstances.
Based upon an examination of publicly available information relating to the
businesses in which the Company and its subsidiaries are engaged, the Purchaser
has determined that the Company and the Parent both produce and distribute
similar product lines in certain geographic areas. In particular, both the
Company and the Parent manufacture and distribute asphalt pavers. Although the
Purchaser believes that the acquisition of Shares pursuant to the Offer would
not violate the antitrust laws, there can be no assurance that a challenge to
the Offer on antitrust grounds will not be made or, if such
43
<PAGE>
challenge is made, what the outcome will be. Should the FTC or the Antitrust
Division raise antitrust concerns, the Purchaser would be prepared, in order to
expedite the Offer or the Merger, to consider the divestiture of certain assets
to deal with those concerns. There is no guarantee that the Purchaser and the
FTC or the Antitrust Division would reach an agreement with respect to such
divestiture. See Section 14 for certain conditions to the Offer, including
conditions with respect to litigation and certain government actions.
On March 29, 1995, the Company initiated litigation (the "Antitrust
Litigation") against the Parent in the United States District Court for the
Southern District of New York. The Antitrust Litigation claims that the Parent's
acquisition of the Company would be in violation of the federal antitrust laws
and asks the court to enter preliminary and permanent injunctions barring the
Parent from proceeding with the transaction. In addition, the Antitrust
Litigation seeks a judgment declaring that the proposed acquisition violates the
federal antitrust laws. The Antitrust Litigation alleges that the proposed
acquisition will substantially lessen competition in the market for asphalt
pavers, which are manufactured and distributed by both the Company and the
Parent. The Parent believes the Antitrust Litigation is without merit since any
antitrust issues which may arise from the paver overlap can readily be resolved.
The Parent's 1994 domestic revenues from the relevant product line were below
$10 million out of total 1994 revenues of $4.5 billion.
EEA Merger Regulation. According to publicly available information, the
Purchaser conducts substantial operations within the EEA and certain of the
individual member states of the EEA. Regulation (EEC) No. 4064/89 (the "Merger
Regulation") and Article 57 of the EEA Agreement require that notices of
concentrations with a "Community dimension" be provided to the European
Commission for review and approval for compatibility with the common market
prior to being put into effect. The Offer would be deemed to have a "Community
dimension" if the combined aggregate worldwide consolidated annual revenues of
both the Parent and the Company exceed ECU 5 billion, if the Community-wide
annual revenues of each of the Parent and the Company exceed ECU 250 million,
and if both the Parent and the Company do not receive more than two-thirds of
their respective Community-wide revenues from one and the same member state.
Based upon publicly available information, the Purchaser believes that the Offer
may be considered to have a "Community dimension." If the Offer falls within the
Merger Regulation, the European Commission, as opposed to individual member
states, has exclusive jurisdiction to review it, subject to certain exceptions.
Under the Merger Regulation, a concentration that meets the foregoing
criteria requires the filing of a notification in a prescribed form with the
European Commission. This filing must normally be made within seven days of the
earlier of the announcement of a public bid, the conclusion of the relevant
agreement or acquisition of a controlling interest. Transactions subject to the
filing requirements of the Merger Regulation are normally suspended
automatically until three weeks after receipt of the notification. The European
Commission may extend the suspension period for such period as it finds
necessary to make a final decision. However, in the case of a public bid the
bidder may acquire shares of the target company during the suspension period
(provided that the transaction has been duly notified to the European
Commission), but may not vote such shares until after the end of the suspension
period unless the European Commission grants permission to do so in order to
maintain the full value of the bidder's investment.
The European Commission must decide whether to initiate proceedings within
one month after the receipt of the notification, subject to certain extensions
for holidays or if an individual member state has requested a referral of the
transaction (or part of it) to itself. If proceedings are initiated, the
European Commission must reach a decision in the proceedings within four months
of the commencement of the proceedings. If the European Commission fails to
reach a decision within either of these time periods the transaction will be
deemed to be compatible with the common market.
44
<PAGE>
If the European Commission declares the Offer to be incompatible with the
common market, it may prevent the consummation of the transaction, order a
divestiture if the transaction has already been consummated or impose conditions
or other obligations. Based upon an examination of publicly available
information relating to the businesses in which the Company and its subsidiaries
are engaged, the Purchaser does not believe that the acquisition of the Company
pursuant to the Offer would be found to be incompatible with the common market.
In the event that the transaction is found not to be subject to the Merger
Regulation, various national merger control regimes of the member states of the
EEA may apply, resulting in the possibility that it may be necessary or
desirable to obtain approvals from the various national authorities. Based upon
an examination of publicly available information relating to the businesses in
which the Company and its subsidiaries are engaged, the Purchaser believes that
if any approval from any such national authority should be required, it would
not preclude the consummation of the Offer or the Merger.
There can be no assurance that a challenge to the Offer will not be made
pursuant to the Merger Regulation or alternatively, if applicable, pursuant to
the merger regulations of one or more of the various member states or, if such a
challenge is made, what the outcome will be. See Section 14.
Other Foreign Approvals. Based on publicly available information, it appears
that the Company also owns property or conducts business in other foreign
countries and jurisdictions outside the EEA. In connection with the acquisition
of the Shares pursuant to the Offer, the laws of certain of those foreign
countries and jurisdictions may require the filing of information with, or the
obtaining of the approval of, governmental authorities in such countries and
jurisdictions. The governments in such countries and jurisdictions might attempt
to impose additional conditions on the Company's operations conducted in such
countries and jurisdictions as a result of the acquisition of the Shares
pursuant to the Offer. There can be no assurance that the Purchaser will be able
to cause the Company or its subsidiaries to satisfy or comply with such laws or
that compliance or non-compliance will not have adverse consequences for the
Company or any subsidiary after purchase of the Shares pursuant to the Offer.
Margin Credit Regulations. Federal Reserve Board Regulations G, T, U and X
(the "Margin Credit Regulations") restrict the extension or maintenance of
credit for the purpose of buying or carrying margin stock, including the Shares,
if the credit is secured directly or indirectly thereby. Such secured credit may
not be extended or maintained in an amount that exceeds the maximum loan value
of the margin stock. Under the Margin Credit Regulations, the Shares are
presently margin stock and the maximum loan value thereof is generally 50% of
their current market value. The definition of "indirectly secured" contained in
the Margin Credit Regulations provides that the term does not include an
arrangement with a customer if the lender in good faith has not relied upon
margin stock as collateral in extending or maintaining the particular credit.
16. FEES AND EXPENSES. Merrill Lynch, Pierce, Fenner & Smith Incorporated
("Merrill Lynch") is acting as Dealer Manager in connection with the Offer and
serving as financial advisor to the Parent and the Purchaser in connection with
the proposed acquisition of the Company. The Parent has paid to Merrill Lynch
fees of $950,000 and has agreed to pay to Merrill Lynch an additional fee of
$4,450,000 upon the consummation of the Offer or a merger or other business
combination with, or acquisition of 50% or more of the Shares or of all or
substantially all of the assets of, the Company. The Parent and the Purchaser
will also reimburse Merrill Lynch for reasonable out-of-pocket expenses,
including reasonable attorneys' fees, and have also agreed to indemnify Merrill
Lynch against certain liabilities and expenses in connection with the Offer,
including certain liabilities under the federal securities laws.
The Purchaser has retained Georgeson & Company Inc. to act as the
Information Agent and The Bank of New York to act as the Depositary in
connection with the Offer. The Information Agent may contact holders of Shares
by mail, telephone, telex, telegraph and personal interview and may request
brokers, dealers and other nominee stockholders to forward the Offer materials
to beneficial owners. The Information Agent and the Depositary will receive
reasonable and customary compensation for
45
<PAGE>
services relating to the Offer and will be reimbursed for certain out-of-pocket
expenses. The Purchaser and the Parent have also agreed to indemnify the
Information Agent and the Depositary against certain liabilities and expenses in
connection with the Offer, including certain liabilities under the federal
securities laws.
The Purchaser will not pay any fees or commissions to any broker or dealer
or any other person for soliciting tenders of Shares pursuant to the Offer
(other than to the Dealer Manager, the Information Agent and the Depositary).
Brokers, dealers, commercial banks and trust companies will, upon request, be
reimbursed by the Purchaser for customary mailing and handling expenses incurred
by them in forwarding offering materials to their customers.
17. MISCELLANEOUS. The Offer is being made solely by this Offer to Purchase
and the related Letter of Transmittal and is being made to 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 will make a good faith effort to comply with any such state statute.
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 the holders of Shares in such state. In any jurisdiction where the
securities, blue sky or other laws require the Offer to be made by a licensed
broker or dealer, the Offer shall be deemed to be made on behalf of the
Purchaser by the Dealer Manager or one or more registered brokers or dealers
that are licensed under the laws of such jurisdiction.
The Purchaser and the Parent have filed with the Commission a Schedule 14D-1
(including exhibits) pursuant to Rule 14d-3 under the Exchange Act, furnishing
certain additional information with respect to the Offer. Such statement and any
amendments thereto, including exhibits, may be inspected and copies may be
obtained from the offices of the Commission (except that they will not be
available at the regional offices of the Commission) in the manner set forth in
Section 7 of this Offer to Purchase.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION ON BEHALF OF THE PURCHASER OR THE PARENT 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.
CEC Acquisition Corp.
April 3, 1995
46
<PAGE>
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS
OF THE PURCHASER AND THE PARENT
1. Directors and Executive Officers of the Purchaser. The name and position
with the Purchaser of each director and executive officer of the Purchaser are
set forth below. The other required information with respect to each such person
is set forth under "Directors and Executive Officers of the Parent" below. All
directors and executive officers listed below are citizens of the United States.
NAME POSITION
- ----------------------------------------------- ---------------------------
Thomas F. McBride.............................. Director and President
William G. Mulligan............................ Director
Patricia Nachtigal............................. Director, Vice President
and Assistant Secretary
William J. Armstrong........................... Treasurer
Ronald G. Heller............................... Secretary
2. Directors and Executive Officers of the Parent. The name, business
address, present principal occupation or employment and material occupations,
positions, offices or employments during the last five years of each director
and executive officer of the Parent and certain other information are set forth
below. Unless otherwise indicated, the business address of each such director
and executive officer is 200 Chestnut Ridge Road, Woodcliff Lake, New Jersey
07675. Unless otherwise indicated, each occupation set forth opposite an
individual's name refers to employment with the Parent. All directors and
executive officers listed below are citizens of the United States, except that
Cedric E. Ritchie is a citizen of Canada and Frederick W. Hadfield is a citizen
of the United Kingdom.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT
AND MATERIAL OCCUPATIONS, POSITIONS, OFFICES
NAME AND ADDRESS OR EMPLOYMENT HELD DURING THE LAST FIVE YEARS
- --------------------------------------------- ---------------------------------------------
<S> <C>
Donald J. Bainton............................ Director since 1993; Chairman, Chief
Continental Can Company Executive Officer and a director of
One Aerial Way Continental Can Co., Inc., an industrial
Sysosset, New York 11791 packaging company which also provides
engineering, architectural and surveying
services, since 1983; director of General
Public Utilities Corporation.
Theodore H. Black............................ Director since 1988; former Chairman and
Chief Executive Officer (1988-1993);
President (1988-1992); director of CPC
International, Inc., McDermott
International, Inc. and General Public
Utilities Corporation.
Brendan T. Byrne............................. Director since 1988; member of law firm of
Carella, Byrne, Bain, Gilfillan, Carella, Byrne, Bain, Gilfillan, Cecchi and
Cecchi and Stewart Stewart since 1982; Governor of State of
6 Becker Farm Road New Jersey (1974-1982); director of
Roseland, New Jersey 07068 Elizabethtown Water Co., Chelsea GCA
Realty, Inc. and Bell Atlantic-New Jersey,
Inc.
</TABLE>
I-1
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT
AND MATERIAL OCCUPATIONS, POSITIONS, OFFICES
NAME AND ADDRESS OR EMPLOYMENT HELD DURING THE LAST FIVE YEARS
- --------------------------------------------- ---------------------------------------------
<S> <C>
Joseph P. Flannery........................... Director since 1986; Chairman, President and
Uniroyal Holding, Inc. Chief Executive Officer of Uniroyal
70 Great Hill Road Holding, Inc., a holding company, since
Naugatuck, Connecticut 06770 1986; partner in Clayton & Dubilier, an
investment firm, (1988-1990); Chairman,
President and Chief Executive Officer of
Uniroyal, Inc., a manufacturer of
chemicals, tires, engineered products and
leisure products (1982-1986); director of
APS, Inc., Arvin Industries, Inc., K Mart
Corporation, Newmont Gold Company, Newmont
Mining Corporation and The Scotts Company.
Constance J. Horner.......................... Director since 1994; Guest Scholar at The
The Brookings Institution Brookings Institution since 1993; Assistant
1775 Massachusetts Ave. NW to the President and Director of
Washington, D.C. 20036 Presidential Personnel at the White House
(1991-1993); Deputy Secretary, U.S.
Department of Health and Human Services
(1989-1991); director of Pfizer, Inc. and
The Prudential Insurance Company of
America.
Alexander H. Massad.......................... Director since 1982; director of Maxim
Engineers, Inc., Research Applications Inc.
and Texas Commerce Bank-Austin; director of
Mobil Corporation (1977-1986); director and
Executive Vice President of Mobil Oil
Corporation (1976-1986).
James E. Perrella............................ Chairman, President and Chief Executive
Officer since 1993 (President since 1992);
Director since 1992; Executive Vice
President (1982-1992); director of
Cincinnati Milacron Inc.
John E. Phipps............................... Director since 1970; private investor;
director of W.R. Grace & Co.
Donald E. Procknow........................... Director since 1973; former Vice Chairman,
Chief Operating Officer and director of
AT&T Technologies, Inc. (formerly Western
Electric Company, Inc.), a
telecommunications company (1984-1986);
Chief Executive Officer of Western Electric
Company (1972-1984); director of The
Prudential Insurance Company of America
(until April 6, 1995).
Cedric E. Ritchie............................ Director since 1987; Chairman of the
The Bank of Nova Scotia Executive Committee of The Bank of Nova
44 King Street West Scotia since 1993; Chairman of the Board
Toronto, Ontario M5H 1H1 and Chief Executive Officer of The Bank of
Nova Scotia from 1974 to January 1995
(Chairman of the Board) and January 1993
(Chief Executive Officer); director of J.
Ray McDermott S.A., MacMillan Bloedel
Limited, Moore Corporation Limited and Nova
Corporation of Alberta.
William G. Mulligan.......................... Executive Vice President since 1988.
</TABLE>
I-2
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT
AND MATERIAL OCCUPATIONS, POSITIONS, OFFICES
NAME AND ADDRESS OR EMPLOYMENT HELD DURING THE LAST FIVE YEARS
- --------------------------------------------- ---------------------------------------------
<S> <C>
J. Frank Travis.............................. Executive Vice President since January 1994;
Vice President (1990-December 1993).
Thomas F. McBride............................ Senior Vice President and Chief Financial
Officer since May 1993; Senior Vice
President and Comptroller (February 1992-
May 1993); Vice President and Comptroller,
(1981-1992).
William J. Armstrong......................... Vice President since 1986 and Treasurer since
1983.
Paul L. Bergren.............................. Vice President and President of the Air
Compressor Group since 1992; Vice
President/General Manager--Centrifugal
Compressor Division (1989-1992).
Frederick W. Hadfield........................ Vice President and President of Ingersoll-
Dresser Pump Company since March 1994; Vice
President (1979-March 1994).
Daniel E. Kletter............................ Vice President since 1990.
Patricia Nachtigal........................... Vice President and General Counsel since
1991; Secretary and Managing Attorney (1988-
1991).
Allen M. Nixon............................... Vice President since February 1995 and
President of Bearing and Components Group
since 1994; Vice President/General
Manager--Torrington Needle Bearings
Division (1983-1994).
James R. O'Dell.............................. Vice President since 1988.
Donald H. Rice............................... Vice President since February 1995; Executive
Director--Human Resources (1994-February
1995); Vice President--Human Resources of
Bearings and Components Group (1988-1993).
Larry H. Pitsch.............................. Vice President since 1990.
Gerald E. Swimmer............................ Vice President since 1982.
R. Barry Uber................................ Vice President since 1990.
Ronald G. Heller............................. Secretary and Assistant General Counsel since
1991; Assistant General Counsel
(1988-1991).
</TABLE>
3. Ownership of Shares by Directors and Executive Officers. Mr. Mulligan
currently owns 2,000 Shares which he acquired more than two years ago. To the
best knowledge of the Purchaser and the Parent, none of the other persons listed
on this Schedule I beneficially owns or has a right to acquire directly or
indirectly any Shares, and none of the persons listed on this Schedule I has
effected any transactions in the Shares during the past 60 days.
I-3
<PAGE>
SCHEDULE II
PARENT PURCHASES OF SHARES
(ALL PURCHASES WERE MADE ON THE OPEN MARKET)
NUMBER PRICE PER
DATE OF SHARES SHARE
- -------- --------- ------------
2/15/95 5,000 54 1/8
10,000 54
14,600 53 7/8
2/21/95 8,000 55
2/22/95 8,400 55 1/4
5,000 55 1/8
2,000 55
2/23/95 15,000 55 3/8
5,000 55 1/4
5,000 55 1/8
5,000 55
5,000 54 7/8
2/24/95 3,200 54 7/8
5,000 54 3/4
10,000 54 5/8
5,000 54 1/2
NUMBER PRICE PER
DATE OF SHARES SHARE
- -------- --------- ------------
2/27/95 5,000 54 1/2
5,000 54 3/8
30,000 54
20,300 53 7/8
2/28/95 15,000 53 7/8
10,000 53 3/4
10,000 53 5/8
10,000 53 1/2
3/1/95 20,000 54 1/4
10,000 54 1/8
3/2/95 7,600 54 1/8
5,000 54
5,000 53 7/8
10,100 53 3/4
---------
TOTAL: 274,200
II-1
<PAGE>
Facsimile copies of the Letter of Transmittal, properly completed and duly
executed, will be accepted. The Letter of Transmittal, certificates for Shares
and/or Rights and any other required documents should be sent or delivered by
each stockholder of the Company or his broker, dealer, commercial bank, trust
company or other nominee to the Depositary as follows:
<TABLE>
<S> <C> <C>
The Depositary for the Offer
is:
THE BANK OF NEW YORK
By Mail: By Facsimile Transmission: By Hand or Overnight Delivery:
Tender & Exchange Department (for Eligible Institutions Tender & Exchange Department
P.O. Box 11248 only) 101 Barclay Street
Church Street Station (212) 815-6213 Receive and Deliver Window
New York, NY 10286-1243 For Information Telephone: New York, NY 10286
(800) 507-9357
</TABLE>
Any questions and requests for assistance may be directed to the Information
Agent or the Dealer Manager at their respective telephone numbers and addresses
listed below. Additional copies of this Offer to Purchase, the Letter of
Transmittal and the Notice of Guaranteed Delivery may also be obtained from the
Information Agent. You may also contact your broker, dealer, commercial bank or
trust company for assistance concerning the Offer.
The Information Agent for the Offer is:
LOGO
Wall Street Plaza
New York, NY 10005
Banks and Brokers Call Collect: (212) 440-9800
All Other Call Toll-Free: (800) 223-2064
The Dealer Manager for the Offer is:
MERRILL LYNCH & CO.
World Financial Center
North Tower
New York, NY 10281-1305
(212) 236-4723 (Call Collect)
EXHIBIT 11(a)(2)
<PAGE>
LETTER OF TRANSMITTAL
TO TENDER SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
OF
CLARK EQUIPMENT COMPANY
PURSUANT TO THE OFFER TO PURCHASE
DATED APRIL 3, 1995
BY
CEC ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
INGERSOLL-RAND COMPANY
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON FRIDAY, APRIL 28, 1995 UNLESS THE OFFER IS EXTENDED.
<TABLE>
<S> <C> <C>
The Depositary for the Offer is:
The Bank of New York
By Mail: By Facsimile Transmission: By Hand or Overnight Delivery:
Tender & Exchange Department (for Eligible Institutions only) Tender & Exchange Department
P.O. Box 11248 (212) 815-6213 101 Barclay Street
Church Street Station Confirm by Telephone: Receive and Deliver Window
New York, NY 10286-1243 (800) 507-9357 New York, NY 10286
</TABLE>
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE, OR TRANSMISSIONS OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN AS SET
FORTH ABOVE, WILL NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
This Letter of Transmittal is to be completed by stockholders either if
certificates for Shares or Rights (as such terms are defined below) are to be
forwarded herewith or, unless an Agent's Message (as defined in Section 2 of the
Offer to Purchase) is utilized, if tenders of Shares or Rights are to be made by
book-entry transfer into the account of The Bank of New York, as Depositary (the
"Depositary"), at The Depository Trust Company ("DTC"), the Midwest Securities
Trust Company ("MSTC") or the Philadelphia Depository Trust Company ("PDTC")
(each a "Book-Entry Transfer Facility" and collectively the "Book-Entry Transfer
Facilities") pursuant to the procedures set forth in Section 3 of the Offer to
Purchase (as defined below). Stockholders who tender Shares or Rights by
book-entry transfer are referred to herein as "Book-Entry Stockholders".
Unless and until CEC Acquisition Corp., a Delaware corporation (the
"Purchaser"), declares that the Rights Condition (as defined in the Offer to
Purchase) is satisfied, holders of Shares will be required to tender one Right
for each Share tendered in order to effect a valid tender of such Share. If the
Distribution Date (as defined in the Offer to Purchase) has not occurred prior
to the time Shares are tendered pursuant to the Offer, a tender of Shares will
also constitute a tender of the associated Rights. See Section 3 of the Offer to
Purchase. If the Distribution Date has occurred, and certificates representing
Rights (the "Rights Certificates") have been distributed to holders of Shares,
such holders of Shares will be required to tender Rights Certificates
representing a number of Rights equal to the number of Shares being tendered in
order to effect a valid tender of such Shares. Holders of Shares and Rights
whose certificates for such Shares (the "Share Certificates") and, if
applicable, Rights Certificates are not immediately available or who cannot
deliver their Share Certificates or, if applicable, Rights Certificates and all
other required documents to the Depositary prior to the Expiration Date (as
defined in Section 1 of the Offer to Purchase), or who cannot complete the
procedure for book-entry transfer on a timely basis, must tender their Shares
and Rights according to the guaranteed delivery procedure set forth in Section 3
of the Offer to Purchase. See Instruction 2. DELIVERY OF DOCUMENTS TO A
BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
<PAGE>
<TABLE>
<S> <C> <C> <C>
DESCRIPTION OF SHARES TENDERED
NAME(S) & ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN, IF BLANK, EXACTLY AS SHARES CERTIFICATE(S) AND SHARE(S) TENDERED
NAME(S) APPEAR(S) ON CERTIFICATE(S)) (ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
TOTAL NUMBER
SHARES OF SHARES NUMBER OF
CERTIFICATE REPRESENTED BY SHARES
NUMBER(S)* CERTIFICATE(S)* TENDERED**
Total Shares..................................
</TABLE>
* Need not be completed by Book-Entry Stockholders.
** Unless otherwise indicated, all Shares represented by certificates
delivered to the Depositary will be deemed to have been tendered. See
Instruction 4.
<TABLE>
<S> <C> <C> <C>
DESCRIPTION OF RIGHTS TENDERED*
NAME(S) & ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN, IF BLANK, EXACTLY AS RIGHTS CERTIFICATE(S) AND RIGHT(S) TENDERED
NAME(S) APPEAR(S) ON CERTIFICATE(S)) (ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
TOTAL NUMBER
OF RIGHTS
RIGHTS REPRESENTED BY NUMBER OF
CERTIFICATE RIGHTS RIGHTS
NUMBER(S)** CERTIFICATE(S)** TENDERED***
Total Rights..................................
</TABLE>
* Need not be completed if the Distribution Date (as defined below) has not
occurred.
** Need not be completed by Book-Entry Stockholders.
*** Unless otherwise indicated, all Rights represented by certificates
delivered to the Depositary will be deemed to have been tendered. See
Instruction 4.
<PAGE>
/ / CHECK HERE IF SHARES ARE BEING TENDERED BY BOOK-ENTRY TRANSFER MADE TO AN
ACCOUNT MAINTAINED BY THE DEPOSITARY WITH A BOOK-ENTRY TRANSFER FACILITY AND
COMPLETE THE FOLLOWING (ONLY PARTICIPANTS IN A BOOK-ENTRY TRANSFER FACILITY
MAY DELIVER SHARES BY BOOK-ENTRY TRANSFER):
Name of Tendering
Institution ________________________________________________________________
Check box of Book-Entry Transfer Facility (check one):
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
Account Number ___________________Transaction Code Number ____________________
/ / CHECK HERE IF SHARES ARE BEING TENDERED PURSUANT TO A NOTICE OF GUARANTEED
DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING:
Name(s) of Registered Owner(s): ____________________________________________
Window Ticket Number (if any): _____________________________________________
Date of Execution of Notice of Guaranteed Delivery: ________________________
Name of Institution that Guaranteed Delivery: ______________________________
If delivered by Book-Entry Transfer, check box of Book-Entry Transfer
Facility (check one):
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
Account Number __________________ Transaction Code Number __________________
<PAGE>
/ / CHECK HERE IF RIGHTS ARE BEING TENDERED BY BOOK-ENTRY TRANSFER MADE TO AN
ACCOUNT MAINTAINED BY THE DEPOSITARY WITH A BOOK-ENTRY TRANSFER FACILITY AND
COMPLETE THE FOLLOWING (ONLY PARTICIPANTS IN A BOOK-ENTRY TRANSFER FACILITY
MAY DELIVER RIGHTS BY BOOK-ENTRY TRANSFER):
Name of Tendering Institution ______________________________________________
Check box of Book-Entry Transfer Facility (check one):
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
Account Number ___________________ Transaction Code Number __________________
/ / CHECK HERE IF RIGHTS ARE BEING TENDERED PURSUANT TO A NOTICE OF GUARANTEED
DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING:
Name(s) of Registered Owner(s): ____________________________________________
Window Ticket Number (if any): _____________________________________________
Date of Execution of Notice of Guaranteed Delivery: ________________________
Name of Institution that Guaranteed Delivery: ______________________________
If delivered by Book-Entry Transfer, check box of Book-Entry Transfer Facility
(check one):
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
Account Number ____________________ Transaction Code Number __________________
<PAGE>
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
Ladies and Gentlemen:
The undersigned hereby tenders to CEC Acquisition Corp., a Delaware
corporation (the "Purchaser"), a wholly owned subsidiary of Ingersoll-Rand
Company, a New Jersey corporation ("Parent"), the above-described shares of
Common Stock, $7.50 par value per share (the "Shares"), of Clark Equipment
Company, a Delaware corporation (the "Company"), and (unless and until the
Purchaser declares that the Rights Condition (as defined in the Offer to
Purchase described below) is satisfied), the associated Preferred Stock Purchase
Rights (the "Rights") issued pursuant to the Rights Agreement, dated as of March
10, 1987, as amended and restated as of August 14, 1990 (as so amended and
restated, the "Rights Agreement"), between the Company and Harris Trust and
Savings Bank, as Rights Agent (the "Rights Agent"), at a purchase price of
$77.00 per Share (and associated Right), 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 April 3, 1995 (the "Offer to Purchase") and in this
Letter of Transmittal (which together constitute the "Offer"). Unless the
context requires otherwise, all references to Shares shall be deemed to refer
also to the associated Rights, and all references to Rights shall be deemed to
include all benefits that may inure to the stockholders of the Company or to
holders of the Rights pursuant to the Rights Agreement. The undersigned
understands that 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 and Rights tendered pursuant to the
Offer, receipt of which is hereby acknowledged.
The undersigned understands that if the Distribution Date (as defined in the
Offer to Purchase) has occurred and certificates representing Rights (the
"Rights Certificates") have been distributed to holders of Shares prior to the
date of tender of the Shares and Rights tendered herewith, Rights Certificates
representing a number of Rights equal to the number of Shares being tendered
herewith must be delivered to the Depositary (as defined below) or, if
available, a Book-Entry Confirmation (as defined herein) received with respect
thereto, in order for the Shares tendered herewith to be validly tendered. If
the Distribution Date has occurred and Rights Certificates have not been
distributed prior to the time Shares and Rights are tendered herewith, the
undersigned agrees to deliver Rights Certificates representing a number of
Rights equal to the number of Shares tendered herewith to The Bank of New York
(the "Depositary") within five business days after the date such Rights
Certificates are distributed. A tender of shares without Rights Certificates
constitutes an agreement by the tendering stockholder to deliver Rights
Certificates representing a number of Rights equal to the number of Shares
tendered pursuant to the Offer to the Depositary within five business days after
the date such Rights Certificates are distributed. The undersigned understands
that if the Rights Condition is not satisfied the Purchaser reserves the right
to require that the Depositary receive such Rights Certificates prior to
accepting Shares for payment. In that event, payment for Shares tendered and
accepted for payment pursuant to the Offer will be made only after timely
receipt by the Depositary of, among other things, Rights Certificates, if Rights
Certificates have been distributed to holders of Shares.
Subject to, and effective upon, acceptance for payment for the Shares and
Rights 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 and Rights
that are being tendered hereby and any and all dividends, distributions
(including additional Shares) or rights declared, paid or issued with respect to
the tendered Shares on or after April 3, 1995 and payable or distributable to
the undersigned on a date prior to the transfer to the name of the Purchaser or
nominee or transferee of the Purchaser on the Company's stock transfer records
of the Shares tendered herewith (except that if the Rights are redeemed by the
Company's Board of Directors in accordance with the terms of the Rights
Agreement, tendering stockholders who are holders of record as of the applicable
record date will be entitled to receive and retain the redemption price of $.05
per Right in accordance with the Rights Agreement) (collectively, a
"Distribution"), and appoints the Depositary the true and lawful agent and
attorney-in-fact of the undersigned with respect to such Shares and Rights (and
any Distribution) with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest) to (a) deliver such
Share Certificates (as defined herein) and Rights Certificates (and any
Distribution) or transfer ownership of such Shares and Rights (and any
Distribution) on the account books maintained by a Book-Entry Transfer Facility,
together in either case with appropriate evidences of transfer, to the
Depositary for the account of the Purchaser, (b) present such Shares and Rights
(and any Distributions) for transfer on the books of the Company and (c) receive
all benefits and otherwise exercise all rights of beneficial ownership of such
Shares and Rights (and any Distribution), all in accordance with the terms and
subject to the conditions of the Offer.
<PAGE>
The undersigned irrevocably appoints designees of the Purchaser as such
stockholder's proxy, with full power of substitution, to the full extent of such
stockholder's rights with respect to the Shares and Rights tendered by such
stockholder and accepted for payment by the Purchaser and with respect to any
and all other Shares or other securities issued or issuable in respect of such
Shares on or after April 3, 1995. 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 Rights (and such other shares and securities) will be
revoked without further action, and no subsequent proxies may be given nor any
subsequent written consents executed (and, if given or executed, will not be
deemed effective). The designees of the Purchaser will 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 and Rights 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 and Rights.
The undersigned hereby represents and warrants that (a) the undersigned has
full power and authority to tender, sell, assign and transfer the Shares and
Rights tendered hereby (and any Distribution) and (b) when the Shares and Rights
are accepted for payment by the Purchaser, the Purchaser will acquire good,
marketable and unencumbered title to the Shares and Rights (and any
Distribution), free and clear of all liens, restrictions, charges and
encumbrances, and the same will not be subject to any adverse claim. The
undersigned, upon request, will 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 and Rights tendered
hereby (and any Distribution). In addition, the undersigned shall promptly remit
and transfer to the Depositary for the account of the Purchaser any and all
Distributions in respect of the Shares and Rights tendered hereby, accompanied
by appropriate documentation of transfer; and pending such remittance or
appropriate assurance thereof, the Purchaser will be, subject to applicable law,
entitled to all rights and privileges as owner of any such Distribution and may
withhold the entire purchase price or deduct from the purchase price the amount
or value thereof, as determined by the Purchaser in its sole discretion.
All authority herein conferred or agreed to be conferred shall not be
affected by and shall survive the death or incapacity of the undersigned and any
obligation of the undersigned hereunder shall be binding upon the heirs,
personal representatives, successors and assigns of the undersigned.
Tenders of Shares and Rights made pursuant to the Offer are irrevocable,
except that Shares and Rights tendered pursuant to the Offer may be withdrawn at
any time prior to the Expiration Date (as defined in the Offer to Purchase) and,
unless theretofore accepted for payment by the Purchaser pursuant to the Offer,
may also be withdrawn at any time after June 1, 1995. See Section 4 of the Offer
to Purchase.
The undersigned understands that tenders of Shares and Rights pursuant to
any 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 set forth in the
Offer, including the undersigned's representation that the undersigned owns the
Shares and Rights being tendered.
Unless otherwise indicated herein under "Special Payment Instructions",
please issue the check for the purchase price and/or issue or return any
certificate(s) for Shares and Rights not tendered or not accepted for payment in
the name(s) of the registered holder(s) appearing under "Description of Shares
Tendered" and "Description of Rights Tendered", respectively. Similarly, unless
otherwise indicated herein under "Special Delivery Instructions", please mail
the check for the purchase price and/or any certificate(s) for Shares and Rights
not tendered or not accepted for payment (and accompanying documents, as
appropriate) to the address(es) of the registered holder(s) appearing under
"Description of Shares Tendered" and "Description of Rights Tendered",
respectively. In the event that both the Special Delivery Instructions and the
Special Payment Instructions are completed, please issue the check for the
purchase price and/or any certificate(s) for Shares and Rights not tendered or
accepted for payment in the name of, and deliver such check and/or such
certificates to, the person or persons so indicated. Unless otherwise indicated
herein under "Special Payment Instructions", please credit any Shares and Rights
tendered herewith by book-entry transfer that are not accepted for payment by
crediting the account at the Book-Entry Transfer Facility (as defined herein)
designated above. The undersigned recognizes that the Purchaser has no
obligation, pursuant to the Special Payment Instructions, to transfer any Shares
or Rights from the name(s) of the registered holder(s) thereof if the Purchaser
does not accept for payment any of the Shares or Rights so tendered.
<PAGE>
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if certificate(s) for Shares and Rights not tendered or not
accepted for payment and/or the check for the purchase price of Shares and
Rights accepted for payment are to be issued in the name of someone other than
the undersigned or if Shares or Rights tendered by book-entry transfer which are
not accepted for payment are to be returned by credit to an account maintained
at a Book-Entry Transfer Facility.
Issue: / / check / / certificates to:
Name............................................................................
(PLEASE PRINT)
Address.........................................................................
...............................................................................
(INCLUDE ZIP CODE)
...............................................................................
(TAX ID. OR SOCIAL SECURITY NO.)
(SEE SUBSTITUTE FORM W-9 ON THE REVERSE SIDE)
Credit Shares and Rights tendered by book-entry transfer that are not accepted
for payment to (Check one):
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
...............................................................................
(DTC, MSTC OR PDTC ACCOUNT NO.)
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if certificate(s) for Shares and Rights not tendered or not
accepted for payment and/or the check for the purchase price of Shares and
Rights accepted for payment are to be sent to someone other than the undersigned
or to the undersigned at an address other than that shown above.
Mail: / / check / / certificates to:
Name............................................................................
(PLEASE PRINT)
Address.........................................................................
...............................................................................
(INCLUDE ZIP CODE)
...............................................................................
(TAX ID. OR SOCIAL SECURITY NO.)
(SEE SUBSTITUTE FORM W-9 ON THE REVERSE SIDE)
<PAGE>
<TABLE>
<S> <C> <C> <C>
SIGN HERE
SIGN AND COMPLETE SUBSTITUTE FORM W-9 ON REVERSE SIGN
HERE .............................................................................. HERE
..............................................................................
(SIGNATURES(S) OF HOLDERS(S))
DATED:................................................................., 1995
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on
Share Certificate(s) or Rights Certificate(s) or on a security position list-
ing or by person(s) authorized to become registered holder(s) by certificates
and document transmitted herewith. If signature is by trustees,executors,
administrators, guardians, attorneys-in-fact, officers of corporations or
others acting in a fiduciary or representative capacity, please provide the
following information and see Instruction 5.)
Name(s).......................................................................
..............................................................................
(Please Print)
Capacity (Full Title).........................................................
Address.......................................................................
..............................................................................
(Include Zip Code)
Area Code and Telephone Number................................................
Tax Identification or
social Security No............................................................
COMPLETE SUBSTITUTE FORM W-9 ON REVERSE
Guarantee of Signature(s)
(See Instructions 1 and 5)
Authorized Signature..........................................................
Name..........................................................................
Name of Firm..................................................................
(Please Print)
Address.......................................................................
(Include Zip Code)
Area Code and Telephone Number................................................
DATED:.................................................................., 1995
</TABLE>
<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) of Shares and Rights (which term, for purposes of this
document, shall include any participant in a Book-Entry Transfer Facility whose
name appears on a security position listing as the owner of Shares and/or
Rights) tendered herewith, unless such holder(s) has completed either the box
entitled "Special Payment Instructions" or the box entitled "Special Delivery
Instructions" above, or (b) if such Shares and/or Rights are tendered for the
account of a firm which is a bank, broker, dealer, credit union, savings
association or other entity which is a member in good standing of the Securities
Transfer Agents Medallion Program (each of the foregoing being referred to as an
"Eligible Institution"). In all other cases, all signatures on this Letter of
Transmittal must be guaranteed by an Eligible Institution. See Instruction 5 of
this Letter of Transmittal.
2. REQUIREMENTS OF TENDER. This Letter of Transmittal is to be completed by
stockholders either 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, or timely confirmation (a "Book-Entry
Confirmation") of a book-entry transfer of such Shares into the Depositary's
account at a 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) and,
unless and until the Purchaser declares that the Rights Condition (as defined in
the Offer to Purchase) is satisfied, Rights Certificates or timely confirmation
of a book-entry transfer of Rights into the Depositary's account at a Book-Entry
Transfer Facility, if available (together with, if Rights are forwarded
separately from Shares, a properly completed and duly executed Letter of
Transmittal (or a facsimile hereof) with any required signature guarantees, or
an Agent's Message in the case of a book-entry delivery, 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 or, if later,
within five business days after the date such Rights Certificates are
distributed. Stockholders whose Share Certificates or Rights Certificates are
not immediately available (including Rights Certificates that have not yet been
distributed by the Company) or who cannot deliver their Share Certificates or
Rights Certificates and all other required documents to the Depositary prior to
the Expiration Date or who cannot complete the procedure for delivery by
book-entry transfer on a timely basis may tender their Shares and Rights 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; (iii) the Share
Certificates (or a Book-Entry Confirmation) representing 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 five New York Stock Exchange, Inc.
("NYSE") trading days after the date of execution of such Notice of Guaranteed
Delivery; and (iv) unless and until the Purchaser declares that the Rights
Condition is satisfied, the Rights Certificates, if issued, representing the
appropriate number of Rights or a Book Entry Confirmation, if available, in each
case together with a properly completed and duly executed Letter of Transmittal
(or a facsimile thereof), 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 five NYSE trading days after the date of execution of such Notice of
Guaranteed Delivery or, if later, five NYSE trading days after Rights
Certificates are distributed to stockholders, all as provided in Section 3 of
the Offer to Purchase. If Share Certificates and Rights 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 SHARE CERTIFICATES OR OF RIGHTS CERTIFICATES AND
ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH ANY BOOK-ENTRY TRANSFER
FACILITY, IS AT THE OPTION AND RISK OF THE TENDERING STOCKHOLDER. 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 and Rights 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 and Rights for payment.
3. INADEQUATE SPACE. If the space provided herein is inadequate, the
certificate numbers and/or the number of Shares and Rights and any other
required information should be listed on a separate signed schedule attached
hereto.
<PAGE>
4. PARTIAL TENDERS. (Not Applicable to Book-Entry Stockholders) If fewer
than all the Shares evidenced by any Share Certificate submitted are to be
tendered, fill in the number of Shares which are to be tendered in the box
entitled "Number of Shares Tendered". If fewer than all the Rights evidenced by
any Rights Certificates submitted are to be tendered, fill in the number of
Rights which are to be tendered in the box entitled "Number of Rights Tendered".
In such cases, new Share Certificates or Rights Certificates, as the case may
be, for the Shares or Rights that were evidenced by your old Share Certificates
or Rights 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 and all Rights represented by Rights Certificates delivered
to the Depositary will be deemed to have been tendered unless otherwise
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
and Rights 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 and Rights tendered hereby are owned of record by two
or more joint owners, all such owners must sign this Letter of Transmittal.
If any of the tendered Shares and Rights 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 of
certificates.
If this Letter of Transmittal or any certificates or stock powers are signed
by trustees, executors, administrators, guardians, attorneys-in-fact, officers
of corporations or others acting in a fiduciary or representative capacity, such
persons should so indicate when signing, and proper evidence satisfactory to the
Purchaser of their authority so to act must be submitted.
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares and Rights listed and transmitted hereby, no endorsements of certificates
or separate stock powers are required unless payment is to be made to or
certificates for Shares or Rights not tendered or not purchased are to be issued
in the name of a person other than the registered holder(s). Signatures on such
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, 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 on the certificate(s).
Signatures on such certificates or stock powers must be guaranteed by an
Eligible Institution.
Unless and until the Purchaser declares the Rights Condition to be
satisfied, if Rights Certificates have been distributed to holders of Shares,
such holders are required to tender Rights Certificate(s) representing a number
of Rights equal to the number of Shares tendered in order to effect a valid
tender of such Shares. It is necessary that stockholders follow all signature
requirements of this Instruction 5 with respect to the Rights in order to tender
such Rights.
6. STOCK TRANSFER TAXES. Except as otherwise provided in this Instruction 6,
the Purchaser will pay any stock transfer taxes with respect to the transfer and
sale of Shares and Rights 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
and Rights not tendered or 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 person) payable on account
of the transfer to such person will be deducted from the purchase price unless
satisfactory evidence of the payment of such taxes or an exemption therefrom, is
submitted.
Except as otherwise provided in this Instruction 6, it will not be necessary
for transfer tax stamps to be affixed to the certificate(s) listed in this
Letter of Transmittal.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check is to be issued in
the name of, and/or certificates for Shares and Rights 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. A Book-Entry Stockholder may request that Shares and/or Rights not
accepted for payment be credited to such account maintained at a Book-Entry
Transfer Facility as such Book-Entry Stockholder may designate under "Special
Payment Instructions". If no such instructions are given, such Shares or Rights
not accepted for payment will be returned by crediting the account at the
Book-Entry Transfer Facility designated above.
8. WAIVER OF CONDITIONS. The conditions of the Offer may be waived by the
Purchaser in whole or in part at any time and from time to time in its sole
discretion.
9. 31% BACKUP WITHHOLDING; SUBSTITUTE FORM W-9. Under U.S. Federal income
tax law, a stockholder whose tendered Shares or Rights are accepted for payment
is required to provide the Depositary with such stockholder's correct taxpayer
identification number ("TIN") on Substitute Form W-9 below. If the Depositary is
not provided with the correct TIN, the Internal Revenue Service may subject the
stockholder or other payee to a $50 penalty. In addition, payments that are made
to such stockholder or other payee with respect to Shares or Rights purchased
pursuant to the Offer may be subject to 31% backup withholding.
<PAGE>
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, the stockholder must submit a Form W-8, signed under penalties of
perjury, attesting to that individual's exempt status. A Form W-8 can be
obtained from the Depositary. See the enclosed "Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9" for more instructions.
If backup withholding applies, the Depositary is required to withhold 31% of
any such payments made to the stockholder or other payee. Backup withholding is
not an additional tax. Rather, the tax liability of persons subject to backup
withholding will be reduced by the amount of tax withheld. If withholding
results in an overpayment of taxes, a refund may be obtained from the Internal
Revenue Service.
The box in Part 3 of the Substitute Form W-9 may be checked if the tendering
stockholder has not been issued a TIN and has applied for a TIN or intends to
apply for a TIN in the near future. If the box in Part 3 is checked, the
stockholder or other payee must also complete the Certificate of Awaiting
Taxpayer Identification Number below in order to avoid backup withholding.
Notwithstanding that the box in Part 3 is checked and the Certificate of
Awaiting Taxpayer Identification Number is completed, the Depositary will
withhold 31% of all payments made prior to the time a properly certified TIN is
provided to the Depositary.
The stockholder is required to give the Depositary the TIN (e.g., social
security number or employer identification number) of the record owner of the
Shares and Rights or of the last transferee appearing on the transfers attached
to, or endorsed on, the Shares and Rights. If the Shares or Rights 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 guidance on which number to report.
10. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions or requests for
assistance may be directed to the Dealer Manager or the Information Agent at
their respective addresses and telephone numbers set forth below. Additional
copies of the Offer to Purchase, this Letter of Transmittal and the Notice of
Guaranteed Delivery may also be obtained from the Information Agent or from
brokers, dealers, commercial banks or trust companies.
11. LOST, DESTROYED OR STOLEN CERTIFICATES. If any certificate representing
Shares or Rights has been lost, destroyed or stolen, the stockholder should
promptly notify the Depositary. 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 FACSIMILE HEREOF), TOGETHER WITH
CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER OR THE NOTICE OF GUARANTEED
DELIVERY, AND ALL OTHER REQUIRED DOCUMENTS, MUST BE RECEIVED BY THE DEPOSITARY
PRIOR TO THE EXPIRATION DATE.
<PAGE>
PAYER'S NAME: THE BANK OF NEW YORK
<TABLE>
<S> <C> <C>
SUBSTITUTE
PART 1--PLEASE PROVIDE YOUR TIN IN THE BOX AT Social Security Number
THE RIGHT AND CERTIFY BY SIGNING AND or Employer
Identification Number
FORM W-9
DATING BELOW.
Department of the Treasury,
Internal Revenue Service
PAYER'S REQUEST FOR
TAXPAYER IDENTIFICATION
NUMBER ("TIN")
Part 2--Certification--Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct Taxpayer Identification
Number (or I am waiting for a number to be issued to me) and
(2) 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.
Certification Instructions--You must cross out item (2) above if you
have been notified by the IRS that you are currently subject to
backup withholding because of under-reporting interest or dividends
on your tax return. However, if after being notified by the IRS that
you were subject to backup witholding you received another
notification from the IRS that you are no longer subject to backup
withholding, do not cross out such Item (2).
PART 3--
SIGN HERE Signature.............................
Date............................., 1995 Awaiting TIN / /
</TABLE>
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.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX
IN PART 3 OF SUBSTITUTE FORM W-9.
<TABLE>
<S> <C>
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 by the time of payment, 31% of all reportable payments made
to me will be withheld.
Signature .................................... Date .................................... , 1995
</TABLE>
<PAGE>
The Information Agent for the Offer is:
[GEORGESON & COMPANY INC.]
Wall Street Plaza
New York, New York 10005
1-800-223-2064 (Toll Free)
The Dealer Manager for the Offer is:
MERRILL LYNCH & CO.
World Financial Center
North Tower
New York, New York 10281-1305
(212) 236-4723 (Call Collect)
April 3, 1995
EXHIBIT 11(a)(3)
<PAGE>
NOTICE OF GUARANTEED DELIVERY
TO
TENDER SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
OF
CLARK EQUIPMENT COMPANY
As set forth in Section 3 of the Offer to Purchase described below, this
instrument or one substantially equivalent hereto must be used to accept the
Offer (as defined below) if certificates for Shares (as defined below) or the
associated Preferred Stock Purchase Rights (the "Rights") are not immediately
available or the certificates for Shares or Rights and all other required
documents cannot be delivered to the Depositary prior to the Expiration Date (as
defined in Section 1 of the Offer to Purchase) or if the procedure for delivery
by book-entry transfer cannot be completed on a timely basis. This instrument
may be delivered by hand or transmitted by facsimile transmission or mail to the
Depositary.
<TABLE>
<S> <C> <C>
The Depositary for the Offer
is:
THE BANK OF NEW YORK
By Mail: By Facsimile Transmission: By Hand or Overnight Delivery:
Tender & Exchange Department (for Eligible Institutions Tender & Exchange Department
P.O. Box 11248 only) 101 Barclay Street
Church Street Station (212) 815-6213 Receive and Deliver Window
New York, NY 10286-1243 Confirm by Telephone: New York, NY 10286
(800) 507-9357
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION OTHER THAN AS SET FORTH
ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
This form 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
under the instructions thereto, such signature guarantee must appear in the
applicable space provided in the signature box in the Letter of Transmittal.
Ladies and Gentlemen:
The undersigned hereby tender(s) to CEC Acquisition Corp., a Delaware
corporation and a wholly owned subsidiary of Ingersoll-Rand Company, a New
Jersey corporation, upon the terms and subject to the conditions set forth in
the Offer to Purchase dated April 3, 1995 (the "Offer to Purchase"), and in the
related Letter of Transmittal (which together constitute the "Offer"), receipt
of which is hereby acknowledged, the number of shares of Common Stock, $7.50 par
value per share (the "Shares"), and the number of Rights, indicated below of
Clark Equipment Company, a Delaware corporation, pursuant to the guaranteed
delivery procedure set forth in Section 3 of the Offer to Purchase.
<PAGE>
<TABLE>
<S> <C>
Signature(s) ......................... Address(es) ...........................
Name(s) of Record Holders
.............................
...................................... ZIP CODE
PLEASE TYPE OR PRINT
Area Code and Tel. No(s) ....
Check one box if Shares and
Rights will be tendered by
book-entry transfer)
Number of Shares and Rights ..........
Certificate Nos. (If Available)
/ / The Depository Trust Company
.......................................
........................................ / / Midwest Securities Trust Company
........................................
/ / Philadelphia Depository Trust Company
Dated ............................, 1995
Account Number ..............
.............................
</TABLE>
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm which is a bank, broker, dealer, credit union,
savings association or other entity which 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 and/or Rights 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, (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 Midwest Securities Trust Company or
the Philadelphia Depository Trust Company (each a "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 five New York Stock Exchange, Inc. ("NYSE") trading days after the date
hereof and (d) guarantees, if applicable, to deliver certificates representing
the Rights ("Rights Certificates") in proper form for transfer, or to deliver
such Rights pursuant to the procedure for book-entry transfer into the
Depositary's account at a Book-Entry Transfer Facility together with, if Rights
are forwarded separately, 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 five NYSE
trading days after the date hereof or, if later, five business days after Rights
Certificates are distributed to holders of Shares.
..................................... ...............................
NAME OF FIRM AUTHORIZED SIGNATURE
..................................... Name ..............................
ADDRESS PLEASE TYPE OR PRINT
..................................... Title .............................
ZIP CODE
Dated ........................, 1995
AREA CODE AND TEL. NO. ...............
NOTE: DO NOT SEND CERTIFICATES FOR SHARES OR RIGHTS WITH THIS NOTICE.
CERTIFICATES SHOULD BE SENT WITH YOUR LETTER OF TRANSMITTAL.
EXHIBIT 11(a)(4)
<PAGE>
WORLD FINANCIAL CENTER
NORTH TOWER
NEW YORK, NEW YORK
10281-1305
(212) 236-4723 (CALL
COLLECT)
[MERRILL LYNCH LOGO]
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
OF
CLARK EQUIPMENT COMPANY
AT
$77.00 NET PER SHARE
BY
CEC ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
INGERSOLL-RAND COMPANY
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON FRIDAY, APRIL 28, 1995 UNLESS THE OFFER IS EXTENDED.
April 3, 1995
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
We have been appointed by CEC Acquisition Corp., a Delaware corporation (the
"Purchaser") and a wholly owned subsidiary of Ingersoll-Rand Company, a New
Jersey corporation (the "Parent"), to act as Dealer Manager in connection with
the Purchaser's offer to purchase for cash all the outstanding shares of Common
Stock, par value $7.50 per share (the "Shares"), of Clark Equipment Company, a
Delaware corporation (the "Company"), and (unless and until the Purchaser
declares the Rights Condition (as defined in the Offer to Purchase) is
satisfied) the associated Preferred Stock Purchase Rights (the "Rights") issued
pursuant to the Rights Agreement, dated as of March 10, 1987, as amended and
restated as of August 14, 1990 (as so amended and restated, the "Rights
Agreement"), between the Company and Harris Trust and Savings Bank, as Rights
Agent, at a purchase price of $77.00 per Share (and associated Right), 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 April 3, 1995 (the "Offer
to Purchase") and in the related Letter of Transmittal (which together
constitute the "Offer") enclosed herewith. Unless and until the Purchaser
declares that the Rights Condition is satisfied, holders of Shares will be
required to tender one Right for each Share tendered in order to effect a valid
tender of such Share. If the Distribution Date (as defined in the Offer to
Purchase) has not occurred prior to the time Shares are tendered pursuant to the
Offer, a tender of Shares will constitute a tender of the associated Rights. If
the Distribution Date has occurred and certificates representing Rights ("Rights
Certificates") have been distributed by the Company to holders of Shares, such
holders of Shares shall be required to tender Rights Certificates representing a
number of Rights equal to the number of Shares being tendered in order to effect
valid tender of such Shares. Holders of Shares and Rights whose certificates for
such Shares (the "Share Certificates") and, if applicable, Rights Certificates
are not immediately available or who cannot deliver their Share Certificates or,
if applicable, their Rights Certificates, and all other required documents to
the Depositary (as defined below) prior to the
<PAGE>
[MERRILL LYNCH LOGO]
Expiration Date (as defined in the Offer to Purchase), or who cannot complete
the procedures for book-entry transfer on a timely basis, must tender their
Shares and Rights according to the guaranteed delivery procedures set forth in
Section 3 of the Offer to Purchase. Unless the context otherwise requires, all
references to Shares shall include the associated Rights. All references to the
Rights shall include all benefits that may inure to holders of Rights pursuant
to the Rights Agreement.
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.
The Offer is conditioned upon, among other things: (1) there being validly
tendered and not properly withdrawn prior to the expiration of the Offer a
number of Shares which constitutes at least 51% of the voting power (determined
on a fully diluted basis) on the date of purchase of all securities of the
Company entitled to vote generally in the election of directors or in a merger;
(2) the Purchaser being satisfied, in its sole discretion, that the
supermajority stockholder vote specified in the supermajority voting provisions
contained in the Company's Restated Certificate of Incorporation would not (as a
result of action by the Company's Board of Directors or otherwise) be required
prior to the consummation of the Merger (as defined in the Offer to Purchase) or
that the Purchaser will acquire a sufficient number of shares to insure a vote
in favor of the Merger under such provisions; (3) the Rights having been
redeemed by the Company's Board of Directors or the Purchaser being satisfied,
in its sole discretion, that the Rights have been invalidated or are otherwise
inapplicable to, or that the dilutive provisions thereof would not be triggered
by, the Offer and the Merger; and (4) the Purchaser being satisfied, in its sole
discretion, that the restrictions on business combinations contained in Section
203 of the Delaware General Corporation Law would not apply to the Purchaser or
the Parent in connection with the Offer or the Merger (as a result of action by
the Company's Board of Directors, the ownership by the Purchaser upon
consummation of the Offer of at least 85% of the outstanding voting stock of the
Company (other than shares held by directors who are also officers and certain
employee stock plans of the Company) or otherwise). The Offer is also subject to
other terms and conditions. See the Introduction and Sections 1 and 14 of the
Offer to Purchase.
Enclosed herewith for your information and forwarding to your clients are
copies of the following documents:
1. The Offer to Purchase, dated April 3, 1995.
2. The green Letter of Transmittal to tender Shares for your use and for
the information of your clients. Facsimile copies of the Letter of
Transmittal may be used to tender Shares.
3. The gold Notice of Guaranteed Delivery for Shares and Rights to be
used to accept the Offer if Share Certificates or Rights Certificates are
not immediately available or if such certificates and all other required
documents cannot be delivered to The Bank of New York (the "Depositary") by
the Expiration Date or if the procedure for book-entry transfer cannot be
completed by the Expiration Date.
4. A gray printed form of letter which 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. Guidelines of the Internal Revenue Service for Certification of
Taxpayer Identification Number on Substitute Form W-9.
6. A return envelope addressed to The Bank of New York, the Depositary.
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS
PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT
12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, APRIL 28, 1995 UNLESS THE OFFER
IS EXTENDED.
<PAGE>
[MERRILL LYNCH LOGO]
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 or Rights, and other required documents should be
sent to the Depositary, and (ii) either Share Certificates, and if applicable,
Rights Certificates, representing the tendered Shares (and, if applicable,
tendered Rights) should be delivered to the Depositary, or such Shares (and, if
applicable, tendered Rights) should be tendered by book-entry transfer into the
Depositary's account maintained at one of the Book-Entry Transfer Facilities (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, if applicable, Rights Certificates, or
other required documents on or 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 commissions or fees to any broker, dealer or
other person (other than the Dealer Manager, the Depositary and Georgeson &
Company Inc. (the "Information Agent") (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 clerical and mailing expenses
incurred by you in forwarding any of the enclosed materials to your clients. The
Purchaser will pay or cause to be paid any stock transfer taxes payable on the
transfer of Shares to it, except as otherwise provided in Instruction 6 of the
Letter of Transmittal.
Any inquiries you may have with respect to the Offer should be addressed to
Merrill Lynch & Co., the Dealer Manager, or the Information Agent, at their
respective addresses and telephone numbers set forth on the back cover of the
Offer to Purchase. Additional copies of the enclosed materials may be obtained
from the Information Agent.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY OTHER PERSON THE AGENT OF THE PURCHASER, THE PARENT, THE DEALER MANAGER,
THE COMPANY, THE DEPOSITARY OR THE INFORMATION AGENT, OR ANY AFFILIATE OF ANY OF
THEM, OR AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENT OR USE ANY
DOCUMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE
ENCLOSED DOCUMENTS AND THE STATEMENTS CONTAINED THEREIN.
EXHIBIT 11(a)(5)
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
OF
CLARK EQUIPMENT COMPANY
AT
$77.00 NET PER SHARE
BY
CEC ACQUISITION CORP.
A WHOLLY OWNED SUBSIDIARY OF
INGERSOLL-RAND COMPANY
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON FRIDAY, APRIL 28, 1995, UNLESS THE OFFER IS EXTENDED.
To Our Clients:
Enclosed for your consideration is an Offer to Purchase dated April 3, 1995
(the "Offer to Purchase"), and the related Letter of Transmittal relating to an
offer by CEC Acquisition Corp., a Delaware corporation (the "Purchaser") and a
wholly owned subsidiary of Ingersoll-Rand Company, a New Jersey corporation (the
"Parent"), to purchase all of the outstanding shares of Common Stock, $7.50 par
value per share (the "Shares"), of Clark Equipment Company, a Delaware
corporation (the "Company"), and (unless and until the Purchaser declares that
the Rights Condition (as defined in the Offer to Purchase) is satisfied) the
associated Preferred Stock Purchase Rights (the "Rights") issued pursuant to the
Rights Agreement, dated as of March 10, 1987, as amended and restated as of as
of August 14, 1990 (as so amended and restated, the "Rights Agreement"), between
the Company and Harris Trust and Savings Bank, as Rights Agent, at a purchase
price of $77.00 per Share (and associated Right), 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 related Letter of Transmittal (which
together constitute the "Offer"). Unless the context requires otherwise, all
references to "Shares" shall be deemed to refer also to the associated Rights.
We are the holder of record of Shares held by us 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 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.
Unless and until the Purchaser declares that the Rights Condition (as
defined below) is satisfied, if certificates representing Rights (the "Rights
Certificates") have been distributed to holders of Shares, such holders are
required to tender Rights Certificate(s) representing a number of Rights equal
the number of Shares being tendered in order to effect a valid tender of such
Shares. Based on the Company's filings with the Securities and Exchange
Commission (the "Commission"), until the Distribution Date (as defined in the
Offer to Purchase), the surrender for transfer of any of the certificates
representing Shares (the "Share Certificates") will also constitute the
surrender for transfer of the Rights associated with the Shares represented by
such Share Certificates. Based on the Company's filings with the Commission, as
soon as practicable following the Distribution Date, the Rights Certificates
will be mailed to holders of record of Shares as of the close of business on the
Distribution Date; after the Distribution Date, such separate Rights
Certificates alone will evidence the Rights. See Section 3 of the Offer to
Purchase.
<PAGE>
We request instructions as to whether you wish to have us tender on your
behalf any or all of such Shares held by us for your account, pursuant to the
terms and subject to the conditions set forth in the Offer to Purchase. Your
instructions to tender Shares held by us for your account will also constitute a
direction to us to tender a number of Rights held by us for your account equal
to the number of Shares tendered.
Your attention is directed to the following:
1. The tender price is $77.00 per share, net to the seller in cash
without interest thereon.
2. The Offer is made for all of the outstanding Shares.
3. The Offer and withdrawal rights will expire at 12:00 Midnight, New
York City time, on Friday, April 28, 1995 unless the Offer is extended.
4. The Offer is conditioned upon, among other things: (1) there being
validly tendered and not properly withdrawn prior to the expiration of the
Offer a number of Shares which constitutes at least 51% of the voting power
(determined on a fully diluted basis) on the date of purchase of all
securities of the Company entitled to vote generally in the election of
directors or in a merger; (2) the Purchaser being satisfied, in its sole
discretion, that the supermajority stockholder vote specified in the
supermajority voting provisions contained in the Company's Restated
Certificate of Incorporation would not (as a result of action by the
Company's Board of Directors or otherwise) be required prior to the
consummation of the Merger (as defined in the Offer to Purchase) or that the
Purchaser will acquire a sufficient number of shares to insure a vote in
favor of the Merger under such provisions, (3) the Rights having been
redeemed by the Company's Board of Directors or the Purchaser being
satisfied, in its sole discretion, that the Rights have been invalidated or
are otherwise inapplicable to, or that the dilutive provisions thereof would
not be triggered by, the Offer and the Merger; and (4) the Purchaser being
satisfied, in its sole discretion, that the restrictions on business
combinations contained in Section 203 of the Delaware General Corporation
Law would not apply to the Purchaser or the Parent in connection with the
Offer or the Merger (as a result of action by the Company's Board of
Directors, the ownership by the Purchaser upon consummation of the Offer of
at least 85% of the outstanding voting stock of the Company (other than
shares held by directors who are also officers and certain employee stock
plans of the Company) or otherwise). The Offer is also subject to other
terms and conditions. See the Introduction and Sections 1 and 14 of the
Offer to Purchase.
5. Tendering shareholders will not be obligated to pay brokerage fees or
commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, stock transfer taxes on the purchase of Shares pursuant to the
Offer.
The Offer is being 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 will make a
good faith effort to comply with any such state statute. 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 the
holders of Shares in such state. In any jurisdiction where the securities, blue
sky or other laws require the Offer to be made by a licensed broker or dealer,
the Offer shall be deemed to be made on behalf of the Purchaser by the Dealer
Manager or one or more registered brokers or dealers that are licensed under the
laws of such jurisdiction.
If you wish to have us tender any or all of the Shares held by us for your
account, please instruct us by completing, executing and returning to us the
instruction form contained in this letter. If you authorize a tender of your
Shares, all such Shares will be tendered unless otherwise specified in such
instruction form. Your instructions should be forwarded to us in ample time to
permit us to submit a tender on your behalf prior to the expiration of the
Offer.
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED PREFERRED STOCK PURCHASE RIGHTS)
OF
CLARK EQUIPMENT COMPANY
The undersigned acknowledge(s) receipt of your letter enclosing the Offer to
Purchase dated April 3, 1995 (the "Offer to Purchase") and the related Letter of
Transmittal pursuant to an offer by CEC Acquisition Corp., a Delaware
corporation and a wholly owned subsidiary of Ingersoll-Rand Company, a New
Jersey corporation, to purchase all outstanding shares of Common Stock, $7.50
par value per share (the "Shares"), of Clark Equipment Company, a Delaware
corporation, and (unless and until the Purchaser declares that the Rights
Condition (as defined in the Offer to Purchase) is satisfied) the associated
Preferred Stock Purchase Rights (the "Rights").
This will instruct you to tender the number of Shares and Rights indicated
below (or, if no number is indicated below, all Shares and Rights) which 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 in the related Letter of
Transmittal furnished to the undersigned.
<TABLE>
<S> <C>
Number of Shares (and Rights) to be SIGN HERE
Tendered* ..........................................
.......................Shares (and Rights)
..........................................
Dated.................................,1995 Signature(s)
..........................................
Please print names(s)
..........................................
Address
..........................................
Area Code and Telephone Number
..........................................
Tax Identification or Social Security Number
</TABLE>
- ------------
* Unless otherwise indicated, it will be assumed that all of your Shares (and
Rights) held by us for your account are to be tendered.
EXHIBIT 11(a)(6)
<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.
- ------------------------------------------------------
FOR THIS TYPE OF ACCOUNT: GIVE THE
SOCIAL SECURITY
NUMBER OF--
- ------------------------------------------------------
1. An individual's account The individual
2. Two or more individuals The actual owner of
(joint account) the account or, if
combined funds, any
one of the
individuals(1)
3. Husband and wife (joint The actual owner of
account) the account or, if
joint funds, either
person(1)
4. Custodian account of a The minor(2)
minor (Uniform Gift to
Minors Act)
5. Adult and minor (joint The adult or, if the
account) minor is the only
contributor, the
minor(1)
6. Account in the name of The ward, minor, or
guardian or committee incompetent person(3)
for a designated ward,
minor or incompetent
person
7. a. The usual revocable The grantor-trustee(1)
savings trust
account (grantor is
also trustee)
b. So-called trust The actual owner(1)
account that is not a
legal or valid trust
under State law
8. Sole proprietorship The owner(4)
account
- ------------------------------------------------------
FOR THIS TYPE OF ACCOUNT: GIVE THE EMPLOYER
IDENTIFICATION
NUMBER OF--
- ------------------------------------------------------
9. A valid trust, estate, The legal entity (Do
or pension trust not furnish the
identifying number of
the personal
representative or
trustee unless the
legal entity itself is
not designated in the
account title.)(5)
10. Corporate account The corporation
11. Religious charitable, The organization
or educational
organization account
12. Partnership account The partnership
held in the name of the
business
13. Association, club, or The organization
other tax-exempt
organization
14. A broker or registered The broker or nominee
nominee
15. Account with the The public entity
Department of
Agriculture in the name
of a public entity
(such as a State or
local government,
school district, or
prison) that receives
agricultural program
payments
- --------------------------------------------------------------------------------
(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) Circle the ward's, minor's or incompetent person's name and furnish such
person's social security number.
(4) Show the name of the owner.
(5) 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 don't have a taxpayer identification number or you don't know your
number, obtain Form SS-5, Application for a Social Security Number Card, or Form
SS-4, Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for a
number.
PAYEE EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on ALL payments include the
following:
. A corporation.
. A financial institution.
. An organization exempt from tax under section 501(a), or an individual
retirement plan.
. The United States or any agency or instrumentality thereof.
. A State, the District of Columbia, a possession of the United States, or any
subdivision or instrumentality thereof.
. A foreign government, a political subdivision of a foreign government, or any
agency or instrumentality thereof.
. An international organization or any agency, or instrumentality thereof.
. A registered dealer in securities or commodities registered in the U.S. or a
possession of the U.S.
. A real estate investment trust.
. A common trust fund operated by a bank under section 584(a).
. An exempt charitable remainder trust, or a nonexempt trust described in
section 4947(a)(1).
. An entity registered at all times under the Investment Company Act of 1940.
. A foreign central bank of issue.
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 where the amount received is not paid in
money.
. Payments made by certain foreign organizations.
. Payments made to a nominee
Payments of interest to 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.
. Payments made to a nominee
Exempt payees described above should file Form W-9 to avoid possible erroneous
backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER
IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO
THE PAYER, IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO
SIGN AND DATE THE FORM.
Certain payments other than interest, dividends, and patronage dividends,
that are not subject to information reporting are also not subject to backup
withholding. For details, see the regulations under sections 6041, 6041(a),
6045, and 6050A.
PRIVACY ACT NOTICE.--Section 6109 requires most recipients of dividend,
interest, or other payments to give taxpayer identification numbers to payers
who must report the payments to IRS. The IRS uses the numbers for identification
purposes. Payers must be given the numbers whether or not recipients are
required to file a tax return. Beginning January 1, 1984, payers must generally
withhold 20% 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 payer, 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) FAILURE TO REPORT CERTAIN DIVIDEND AND INTEREST PAYMENTS.--If you fail to
include any portion of an includible payment for interest, dividends, or
patronage dividends in gross income, such failure will be treated as being due
to negligence and will be subject to a penalty of 5% on any portion of an
under-payment attributable to that failure unless there is clear and convincing
evidence to the contrary.
(3) 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.
(4) CRIMINAL PENALTY FOR FALSIFYING INFORMATION.--Falsifying certifications or
affirmations may subject you to criminal penalties including fines and/or
imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX
CONSULTANT OR THE INTERNAL REVENUE SERVICE
EXHIBIT 11(a)(7)
<PAGE>
This announcement is neither an offer to purchase nor a solicitation of an offer
to sell Shares. The Offer is made solely by the Offer to Purchase dated April 3,
1995 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 a state statute. If
the Purchaser becomes aware of any state where the making of the Offer is
prohibited, the Purchaser will make a good faith effort to comply with any such
statute or seek to have such statute declared inapplicable to the Offer. If,
after such good faith effort, the Purchaser cannot comply with any applicable
statute, the Offer will not be made to (nor will tenders be accepted from or on
behalf of) the holders of Shares in such state. In those jurisdictions whose
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 Merrill Lynch, Pierce, Fenner & Smith Incorporated or one or more
registered brokers or dealers licensed under the laws of such jurisdictions.
Notice of Offer to Purchase for Cash
All Outstanding Shares of Common Stock
(including the Associated Preferred Stock Purchase Rights)
of
Clark Equipment Company
at
$77 Net Per Share
by
CEC Acquisition Corp.
a wholly owned subsidiary of
Ingersoll-Rand Company
CEC Acquisition Corp., a Delaware corporation (the "Purchaser") and a wholly
owned subsidiary of Ingersoll-Rand Company, a New Jersey corporation (the
"Parent"), hereby offers to purchase all of the outstanding shares of common
stock, $7.50 par value per share (the "Shares"), of Clark Equipment Company, a
Delaware corporation (the "Company"), and (unless and until the Purchaser
declares that the Rights Condition (as defined below) is satisfied) the
associated Preferred Stock Purchase Rights (the "Rights") issued pursuant to the
Rights Agreement, dated as of March 10, 1987, as amended and restated as of
August 14, 1990, between the Company and Harris Trust and Savings Bank, as
Rights Agent (as so amended and restated, the "Rights Agreement"), at a purchase
price of $77.00 per Share (and associated Right) 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 April 3, 1995 (the "Offer to Purchase") and in
the related Letter of Transmittal (which together constitute the "Offer").
Unless the context requires otherwise, all references to Shares shall be deemed
to refer also to the associated Rights, and all references to Rights shall be
deemed to include all benefits that may inure to the stockholders of the Company
or to holders of Rights pursuant to the Rights Agreement.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON FRIDAY, APRIL 28, 1995, UNLESS THE OFFER IS EXTENDED.
The Offer is conditioned upon, among other things, (1) there being validly
tendered and not properly withdrawn prior to the expiration of the Offer a
number of Shares which constitutes at least 51% of the voting power (determined
on a fully diluted basis) on the date of purchase of all securities of the
Company entitled to vote generally in the election of directors or in a merger;
(2) the Purchaser being satisfied, in its sole discretion, that the
supermajority stockholder vote specified in the supermajority voting provisions
contained in the Company's Restated Certificate of Incorporation would not (as a
result of action by the Company's Board of Directors or otherwise) be required
prior to the consummation of the proposed Merger described below or that the
Purchaser will acquire a sufficient number of Shares to insure a vote in favor
of such Merger under such provisions; (3) the Company's Preferred Stock Purchase
Rights having been redeemed by the Company's Board of Directors or the Purchaser
being satisfied, in its sole discretion, that such Preferred Stock Purchase
Rights have been invalidated or are otherwise inapplicable to, or that the
dilutive provisions thereof would not be triggered by, the Offer and the
proposed Merger described below (the "Rights Condition"); and (4) the Purchaser
being satisfied, in its sole discretion, that the restrictions on business
combinations contained in Section 203 of the Delaware General Corporation Law
would not apply to the Purchaser or the Parent in connection with the Offer or
the proposed Merger described below (as a result of action by the Company's
Board of Directors, the ownership by the Purchaser upon consummation of the
Offer of at least 85% of the outstanding voting stock of the Company (other than
shares held by directors who are also officers and certain employee stock plans
of the Company) or otherwise). The Offer is also subject to other terms and
conditions. See the Introduction and Sections 1 and 14 of the Offer to Purchase.
The purpose of the Offer is to acquire control of, and the entire equity
interest in, the Company. The Purchaser intends to propose, and to seek to have
the Company consummate as soon as practicable after consummation of the Offer, a
merger or similar business combination (the "Merger") with the Purchaser or
another direct or indirect subsidiary of the Parent, pursuant to which each then
outstanding Share (other than Shares held by the Parent, the Purchaser or any
<PAGE>
other wholly owned subsidiary of the Parent, Shares held in the treasury of the
Company and Shares held by stockholders who properly exercise appraisal rights
under Delaware law) would be converted into the right to receive in cash the
price per Share paid by the Purchaser pursuant to the Offer. The consummation of
the Merger would be subject to a number of factors (including satisfaction of
various conditions) discussed in the Introduction and in Sections 11 and 14 of
the Offer to Purchase. Section 11 of the Offer to Purchase also discusses
certain appraisal rights available to stockholders upon consummation of the
Merger.
Unless and until the Purchaser declares that the Rights Condition is satisfied,
if certificates representing Rights ("Rights Certificates") have been
distributed to holders of Shares, such holders will be required to tender Rights
Certificates representing a number of Rights equal to the number of Shares being
tendered in order to effect a valid tender of such Shares.
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 (as defined in the Offer to Purchase) 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 purchase 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
stockholders whose Shares have been accepted for payment. Under no circumstance
will interest on the purchase price for Shares be paid, regardless of any delay
in making such payment. In all cases, payment for Shares tendered and accepted
for payment pursuant to the Offer will be made only after timely receipt by the
Depositary of (i) certificates representing shares ("Share Certificates") and,
if applicable, Rights Certificates, or timely confirmation of a book-entry
transfer of such Shares and Rights into the Depositary's account at The
Depository Trust Company, the Midwest Securities Trust Company or the
Philadelphia Depository Trust Company (each a "Book-Entry Transfer Facility")
pursuant to the procedures set forth in Section 3 of the Offer to Purchase; (ii)
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 Section 2 of the Offer to Purchase) in connection with a book-entry
transfer, and (iii) any other documents required by the Letter of Transmittal.
The Purchaser expressly reserves the right, in its sole discretion, at any time
and from time to time, to extend the period during which the Offer is open for
any reason, including the occurrence of any of the events specified in Section
14 of the Offer to Purchase, by giving written notice of such extension to the
Depositary. Any such extension will be followed as promptly as practicable by
public announcement 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.
The term "Expiration Date" means 12:00 Midnight, New York City time, on Friday,
April 28, 1995, unless and until the Purchaser, in its sole discretion, shall
have extended the period during 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.
Tenders of Shares and Rights made pursuant to the Offer are irrevocable, except
that Shares and Rights tendered pursuant to the Offer may be withdrawn at any
time on or 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 June 1, 1995. For a withdrawal to be effective, a written
telegraphic, telex 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 such notice of withdrawal must specify the name of
the person who tendered the Shares or Rights to be withdrawn, the number of
Shares or Rights to be withdrawn and the name of the registered holder, if
different from that of the person who tendered such Shares or Rights. If Share
Certificates or Rights Certificates 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 the signatures on the notice of withdrawal must
be guaranteed by an Eligible Institution (as defined in Section 3 of the Offer
to Purchase) unless such Shares or Rights have been tendered for the account of
any Eligible Institution. If Shares or Rights have been tendered pursuant to the
procedure for book-entry transfer as set forth in Section 3 of the Offer to
Purchase, any notice of withdrawal must specify the name and number of the
account at the Book-Entry Transfer Facility to be credited with the withdrawn
Shares or Rights, in which case a notice of withdrawal will be effective if
delivered to the Depositary by any method of delivery described in the second
sentence of this paragraph. A withdrawal of Shares or Rights shall also
constitute a withdrawal of the associated Rights or Shares as applicable. All
questions as to the term 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.
The information required to be disclosed by Rule 14d-6(e)(1)(vii) of the General
<PAGE>
Rules and Regulations under the Securities Exchange Act of 1934, as amended, is
contained in the Offer to Purchase and is incorporated herein by reference.
A demand under Delaware law has been made to the Company for its list of
stockholders and security position listings for the purpose of, among other
things, disseminating the Offer to holders of Shares. Upon compliance by the
Company with such request, the Offer to Purchase and the related Letter of
Transmittal and, if required, other relevant materials will be mailed to record
holders of Shares and Rights whose names appear on the Company's list of
stockholders 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 list of stockholders, or who are listed as participants in a
clearing agency's security position listing for subsequent transmittal to
beneficial owners of Shares. A request pursuant to Rule 14d-5 under the Exchange
Act for use of the Company's stockholder list and security position listings is
also being made to the Company.
The Offer to Purchase and the related Letter of Transmittal contain important
information which should be read before any decision is made with respect to the
Offer.
Questions and requests for assistance may be directed to the Dealer Manager or
the Information Agent as set forth below. Requests for copies of the Offer to
Purchase and the related Letter of Transmittal and all other tender offer
materials may be directed to the Information Agent, and copies 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 and Rights
pursuant to the Offer.
The Information Agent for the Offer is:
[Georgeson & Company Inc. Logo]
Wall Street Plaza
88 Pine Street
New York, New York 10005
1-800-223-2064 (Toll Free)
The Dealer Manager for the Offer is:
Merrill Lynch & Co.
World Financial Center
North Tower
New York, New York 10281-1305
(212) 236-4723 (Call Collect)
April 3, 1995
EXHIBIT 11(a)(8)
<PAGE>
Thomas F. McBride
Senior Vice President For Immediate Release
and Chief Financial Officer
(201) 573-3486
INGERSOLL-RAND ANNOUNCES CASH TENDER OFFER FOR CLARK
EQUIPMENT AT $77 PER SHARE
Woodcliff Lake, N.J. (April 3, 1995) -- Ingersoll-Rand
Company announced today that it has commenced a tender offer for
all outstanding shares of common stock of Clark Equipment Company
at $77 per share in cash.
Ingersoll-Rand also said it is delivering a notice to Clark
today nominating a slate of seven directors to replace the Clark
directors who will be up for election at Clark's annual meeting
scheduled for May 9, 1995. Ingersoll-Rand said it is taking this
action to ensure that Clark's Board of Directors will take all
necessary actions to approve Ingersoll-Rand's tender offer and
permit it to be consummated.
James E. Perrella, Chairman, President and Chief Executive
Officer of Ingersoll-Rand, said: "Last week, Clark's Board of
Directors rejected our invitation to negotiate a merger agreement
between Clark and Ingersoll-Rand. We think Clark's stockholders
should have the opportunity to decide for themselves whether to
accept our proposal."
"We have taken the further step of nominating seven
directors to replace the Clark directors who are up for election
at the upcoming annual meeting scheduled for May 9. 1995.
Ingersoll-Rand's director nominees are all committed to take all
steps necessary to permit Ingersoll-Rand's tender offer and
proposed merger to proceed, including redeeming Clark's
stockholder rights plan and approving the tender offer and
proposed merger for purposes of the Delaware takeover law and
supermajority voting provisions in Clark's certificate of
incorporation," Mr. Perrella said.
<PAGE>
A letter sent today by Mr. Perrella to Leo J. McKernan,
Chairman of Clark, is set forth below::
April 3, 1995
Chairman, President and Chief Executive Officer
Clark Equipment Company
100 North Michigan Street
South Bend, Indiana 46634
Dear Leo:
Over the past two and a half weeks, Ingersoll-Rand has made
repeated efforts to meet with Clark in an attempt to
negotiate the terms of a merger transaction that could be
presented to Clark's stockholders as the joint effort of
both companies' Board and managements. But rather than
recognize its fiduciary responsibility to explore further a
possible transaction on the basis we have proposed, the only
response from Clark has been to state its long-standing
position that Clark is not for sale and to file a lawsuit
against us.
The Company's actions leave us with only one alternative.
Today we are commencing a tender offer to acquire all
outstanding shares of Clark common stock at $77.00 in cash
per share and we are sending a letter notifying you that we
are nominating seven individuals for election as directors
of Clark at Clark's May 9 annual meeting of stockholders.
We regret that we have to resort to these actions; we would
have greatly preferred to enter into negotiations with you
in an effort to reach agreement on a merger transaction.
But even though we have commenced a tender offer, we
continue to be interested in meeting with you to negotiate
the terms of a transaction that can be approved by your
Board.
When your Board recognizes that its fiduciary duties require
consideration of the sale of Clark, please call me.
Sincerely,
/s/ James E. Perrella
Chairman, President and Chief Executive Officer
<PAGE>
The tender offer and withdrawal rights thereunder will expire at
12:00 Midnight, New York City time, on Friday, April 28, 1995,
unless the tender offer is extended.
# # #
Additional Contact:
Clark & Weinstock (212) 953-2550
-----------------
Davis Weinstock
Gene Donati
Carol Phethean
This press release does not constitute a solicitation of a proxy,
consent or authorization for or with respect to the annual
meeting of the Company's stockholders or any action in lieu
thereof. Any such solicitation which Ingersoll-Rand may make
will be made only pursuant to separate proxy materials in
compliance with the requirements of Section 14(a) of the
Securities Exchange Act of 1934, as amended.
EXHIBIT 11(b)(1)
<PAGE>
March 31, 1995
Ingersoll-Rand Company
200 Chestnut Ridge Road
Woodcliff Lake, New Jersey
Attention: Thomas F. McBride --
Senior Vice President and
Chief Financial Officer
Ladies and Gentlemen:
You have advised The Chase Manhattan Bank (National Association)
("Chase") that Ingersoll-Rand Company (the "Company") proposes to form a
----- -------
wholly-owned subsidiary (the "Purchaser") to make a public tender offer (the
---------
"Tender Offer") to acquire (the "Acquisition") all of the issued and
------------ -----------
outstanding capital stock of a public company disclosed to Chase (the
"Target"), to be followed by the merger of the Purchaser with and into the
------
Target (the "Merger" and, collectively with the Acquisition, the
------
"Transactions").
------------
We understand that senior bank financing of up to $1,350,000,000 is
required to finance the consummation of the Transactions, including the
payment of fees, commissions and expenses payable in connection therewith, of
which only $1,000,000,000 is to be available from and after the earlier of
(i) the date 45 days after the effective date of the Merger (the "Merger
------
Effective Date") and (ii) the date 180 days after the Tender Offer Closing
--------------
Date (defined below) for working capital and other general corporate purposes
of the Company and its subsidiaries.
Chase is pleased to offer a commitment to provide the full amount
of the required senior bank financing, all on the terms and conditions
described herein, in the Term Sheet annexed hereto as Exhibit A (the "Term
----
Sheet") and in the letter of even date herewith (the "Fee Letter") addressed
----- ----------
by Chase to you providing, among other things, for certain fees relating to
the senior bank financing (such required senior bank financing is hereinafter
referred to as the "Facility"). Chase's commitment is subject to the
--------
negotiation, execution and exchange of mutually satisfactory definitive
credit documentation. Chase reserves the right to arrange, directly or
indirectly through one or more of
Commitment Letter
-----------------
<PAGE>
-2-
its affiliates (including Chase Securities, Inc.), a syndicate of banks
and/or other financial institutions acceptable to the Company and Chase
(including Chase, the "Lenders") to provide a portion of the Facility; and
-------
Chase shall be relieved of its commitment to provide the Facility to the
extent that other Lenders commit to provide a portion of the Facility.
Chase has submitted this letter after reviewing certain historical
financial statements and other information provided to Chase by you and your
financial advisor. Chase may terminate its obligations under the preceding
paragraph to provide the Facility: (a) if (i) the terms of the Transactions
are changed in any manner, (ii) any information submitted to Chase by you or
on your behalf proves to have been inaccurate or incomplete in any respect,
(iii) any adverse change occurs or (iv) any additional information is
disclosed to or discovered by Chase, that, in the case of each of (i), (ii),
(iii) and (iv) above, Chase deems materially adverse in respect of the
condition (financial or otherwise), business, operations, assets or
liabilities of the Company and its subsidiaries taken as a whole or the
Target and its subsidiaries taken as a whole; (b) if any of the fees provided
for by the Fee Letter are not paid when due or the Company breaches any of
its other undertakings in the Fee Letter; or (c) if any material adverse
change shall occur in loan syndication or capital market conditions
generally.
You hereby indemnify and hold harmless each of Chase and the other
Lenders and each director, officer, employee and affiliate thereof (each, an
"indemnified person") from and against any and all losses, claims, damages,
------------------
liabilities (or actions or other proceedings commenced or threatened in
respect thereof) and expenses that arise out of, result from or in any way
relate to this letter, the Term Sheet or the Fee Letter, or in connection
with the Transactions or the other transactions contemplated hereby or the
provision or syndication of the Facility, and to reimburse each indemnified
person, upon its demand, for any legal or other expenses incurred in
connection with investigating, defending or participating in any such loss,
claim, damage, liability or action or other proceeding (whether or not such
indemnified person is a party to any action or proceeding out of which any
such expenses arise), other than any of the foregoing claimed by any
indemnified person to the extent incurred by reason of the gross negligence
or willful misconduct of such person. Neither Chase nor any other Lender
shall be responsible or liable to the Company or any other person for any
consequential damages that may be alleged as a result of this letter. In
addition, you hereby agree to reimburse Chase from time to time upon Chase's
demand for Chase's reasonable out-of-pocket costs and expenses (including,
without limitation, reasonable legal fees and expenses, appraisal fees and
printing,
Commitment Letter
-----------------
<PAGE>
-3-
reproduction, document delivery, communication and publicity costs) incurred
in connection with the syndication of the Facility and the preparation,
review, negotiation, execution and delivery of this letter, the Term Sheet,
the Fee Letter, the definitive credit documentation and the other documents
relating to the Transactions. Your obligations under this paragraph shall
survive any termination of Chase's obligations under this letter and shall be
effective regardless of whether the definitive credit documentation is
executed.
In accordance with market practice, an information package
containing relevant information concerning the Facility, the Company and its
subsidiaries, the Target and its subsidiaries and the Transactions will be
provided, on a confidential basis, by the Company to potential lenders and
participants. Chase will be pleased to assist the Company in the preparation
of this package. The Company agrees to cooperate, and to cause the
management of the Company to cooperate, with Chase in effecting the
syndication of the Facility (including participation in a reasonable number
of meetings with potential lenders and participants). Chase will manage all
aspects of the primary syndication process, including, without limitation,
the invitation and timing of offers to potential lenders and participants,
the acceptance of commitments and the amounts of commitments accepted.
From the date of delivery of this letter by Chase until the earlier
of (i) the date 30 days after the Tender Offer Closing Date and (ii) Chase
advises you that primary syndication of the Facility has been completed, you
will ensure that, other than the Facility, no financing for the Company and
its subsidiaries shall be syndicated or privately placed among any financial
institutions that would have a detrimental effect upon the Transactions or
the primary syndication of the Facility.
You acknowledge that Chase and its affiliates may be providing
financing or other services to other companies in respect of which you or
your affiliates may have conflicting interests. Chase and its affiliates
will not use confidential information obtained from you by virtue of the
transactions contemplated by this letter or their other relationships with
you in connection with the engagements of Chase and its affiliates with other
companies, and Chase and its affiliates will not furnish any such information
to such other companies. You also acknowledge that Chase and its affiliates
have no obligation to use in connection with the transactions contemplated by
this letter, or to furnish to you or any of your affiliates, confidential
information obtained from other companies.
Commitment Letter
-----------------
<PAGE>
-4-
This letter is delivered to you upon the condition that, prior to
your acceptance of this offer, neither the existence of this letter, the Term
Sheet or the Fee Letter nor any of their contents shall be disclosed by you
except (i) as may be compelled to be disclosed in a judicial or
administrative proceeding or as otherwise required by law or (ii) on a
confidential and "need to know" basis, to your directors, officers,
employees, advisors and agents.
Chase shall have the right to review and approve all public
announcements and filings relating to the Transactions that refer to Chase or
the other Lenders before they are made (such approval not to be unreasonably
withheld).
Chase's offer set forth in this letter will terminate at 11:00 p.m.
(New York City time) on April 2, 1995 unless you accept this letter and the
Fee Letter at or prior to that time by signing and returning to Chase
counterparts of this letter and the Fee Letter. Chase's commitment under
this letter, if accepted by you, will in any event terminate at 5:00 p.m.
(New York City time) on August 31, 1995 if the initial acquisition of shares
under the Tender Offer (the "Tender Offer Closing Date") and the initial
-------------------------
borrowing under the Facility shall not have occurred on or prior to such
date.
This letter and the Fee Letter may be executed in any number of
counterparts, each of which shall be an original and all of which, when taken
together, shall constitute one agreement, and this letter, the Term Sheet and
the Fee Letter may not be assigned by you without the prior written consent
of Chase and may not be amended or any provision hereof or thereof waived or
modified except by an instrument in writing signed by each of the parties
hereto. No person or entity (including, without limitation, Target and its
affiliates) other than the parties hereto shall have any rights under or be
entitled to rely upon this letter, the Term Sheet or the Fee Letter.
This letter, the Term Sheet and the Fee Letter shall be governed by
and construed in accordance with the law of the State of New York.
Commitment Letter
-----------------
<PAGE>
-5-
We look forward to working with you to complete the Transactions.
THE CHASE MANHATTAN BANK
(NATIONAL ASSOCIATION)
By /s/ Patricia B. Bril
---------------------------
Title: Patricia B. Bril
Managing Director
ACCEPTED AND AGREED:
INGERSOLL-RAND COMPANY
By /s/ Thomas F. McBride
--------------------------
Title: Senior Vice President and
Chief Financial Officer
Date: April 2, 1995
Commitment Letter
-----------------
<PAGE>
EXHIBIT A
TERM SHEET
Capitalized terms used herein and not defined
herein have the meanings set forth in the
letter (the "Commitment Letter") to which
-----------------
this Term Sheet is annexed.
Borrower Ingersoll-Rand Company (the "Company").
-------- -------
Guarantor Purchaser/until Merger Effective Date.
---------
Administrative
Agent Chase.
-----
Purpose To fund capital contributions and/or advances
-------
by the Company to the Purchaser required to
consummate the Transactions, and to pay
related fees, commissions and expenses.
Type and Amount
of the Facility $1,350,000,000 reducing revolving credit
---------------
facility.
Chase's Commitment $1,350,000,000
------------------
Final Maturity Five years after the Tender Offer Closing
--------------
Date.
Amortization The Facility shall reduce to $1,000,000,000
------------
on the earlier of (i) the date 45 days after
the Merger Effective Date and (ii) the date
180 days after the Tender Offer Closing Date
(the "Initial Facility Reduction Date"). The
-------------------------------
remaining Facility shall reduce annually
starting two years after the Tender Offer
Closing Date by $100,000,000 at the end of
the second year, by $200,000,000 at the end
of the third year, by $300,000,000 at the end
of the fourth year and by $400,000,000 at the
end of the fifth year.
Availability Drawings may be made at any time from the
------------
Tender Offer Closing Date to but excluding
the Final Maturity.
Security The Facility, the Company's $400,000,000
--------
Credit Agreement dated as of October 31, 1994
(the "Existing Credit Agreement") and any
-------------------------
other long-term notes or debentures that by
Term Sheet
----------
<PAGE>
-2-
their express terms require it will be
equally and ratably secured by a pledge of
all of the capital stock of, and the
Company's advances to, the Purchaser. At any
time on or after the Initial Facility
Reduction Date the Administrative Agent shall
release the security promptly upon receipt
from the Company of a certification referring
to the security and certifying that no
default has occurred and is continuing.
Interest Prior to the earlier of (i) completion of
--------
primary syndication and (ii) 30 days after
the Tender Offer Closing Date, at the
Company's option Base Rate and Competitive
Bid. Thereafter, at the Company's option,
Base Rate, LIBOR, CD and Competitive Bid
loans will be available as follows:
A. Base Rate Option
----------------
Interest shall be at the Base Rate of
Chase, calculated on the basis of the
actual number of days elapsed in a year
of 365/366 days (or 360 days when the
Fed Funds Rate controls the Base Rate),
payable quarterly in arrears. The Base
Rate is defined as the higher of (i) the
Federal Funds Rate, as published by the
Federal Reserve Bank of New York plus
1/2 of 1%, and (ii) the prime commercial
lending rate of Chase, as announced from
time to time at its head office. Base
Rate drawings shall be made available on
a same-day basis if requested prior to
10:00 A.M. New York time and shall be in
minimum amounts of $10,000,000 or any
integral multiple of $1,000,000 in
excess thereof.
B. LIBOR Option
------------
Interest shall be determined for periods
("Interest Periods") of one, two, three
----------------
or six months (as selected by the
Company) and, if agreeable to all of the
Lenders, nine or twelve months, and
shall be at an annual rate equal to the
London Interbank Offered Rate ("LIBOR")
-----
for the corresponding deposits of U.S.
Term Sheet
----------
<PAGE>
-3-
Dollars plus the applicable Interest
Margin specified below. LIBOR will be
determined at the start of each Interest
Period by the Administrative Agent from
the Reuters Screen LIBO Page. Interest
will be paid at the end of each Interest
Period or quarterly, whichever is
earlier, and will be calculated on the
basis of the actual number of days
elapsed in a year of 360 days. LIBOR
will be adjusted for Regulation D
reserve requirements. LIBOR drawings
shall require three business days' prior
notice and shall be in minimum amounts
of $10,000,000 or any integral multiple
of $5,000,000 in excess thereof.
C. CD Option
---------
Interest shall be determined for
Interest Periods of 30, 60, 90 or
180 days (as selected by the Company)
and, if agreeable to all of the Lenders,
270 or 360 days and shall be at an
annual rate equal to the Adjusted
Certificate of Deposit Rate ("CD Rate")
-------
for each Interest Period plus the
applicable Interest Margin specified
below. Interest will be paid at the end
of each Interest Period or quarterly,
whichever is earlier, and will be
calculated on the basis of the actual
number of days elapsed in a year of 360
days. The CD Rate will be determined at
the start of each Interest Period by the
Agent from H.15(519) published by the
Federal Reserve Board, adjusted for
Regulation D reserve requirements and
Federal Deposit Insurance Corporation
premiums. CD drawings shall require
two business days' notice and shall be
in minimum amounts of $10,000,000 or any
integral multiple of $5,000,000 in
excess thereof.
D. Competitive Bid Option
----------------------
The Company may request the
Administrative Agent to solicit
competitive bids from the Lenders
Term Sheet
----------
<PAGE>
-4-
through an auction for borrowings priced
either (i) at a margin above or below
LIBOR or (ii) at an Absolute Interest
Rate, substantially on the terms and
conditions of the provisions for money
market borrowings under the Existing
Credit Agreement. LIBOR bids may be
requested for 1, 2, 3, 6, 9 or 12 months
periods and Absolute bids may be
requested for periods up to and
including 360 days. Interest on LIBOR
and Absolute bids will be paid at the
end of each Interest Period or
quarterly, whichever is earlier.
Lenders may bid, at their own
discretion, for amounts up to the total
Facility amount, regardless of their pro
rata commitments. Competitive Bid Rate
loans will be allotted to the bidding
Lenders in order of effective cost,
starting from the lowest cost and rising
to the highest acceptable cost. The
Company shall be under no obligation to
accept all or any of the bids received
from the Lenders.
Outstandings under the Facility will be
defined as the sum of the Competitive
Bid Rate Borrowings plus committed
borrowings. Each Lender will be
obligated to fund committed borrowings
equal to their pro rata share regardless
of the amount of Competitive Bid
Borrowings held by it.
The Competitive Bid Option shall be
available for borrowings of a minimum of
$10,000,000 and multiples of $5,000,000
in excess thereof up to a maximum of the
Facility. Competitive bids require four
business days notice for LIBOR bids and
one business day notice for Absolute
Rate bids. The Company will pay to the
Administrative Agent a fee of $1,000 for
each Competitive Bid solicitation.
Interest on any amount not paid when due will
accrue at a rate of 2% in excess of the Base
Rate and will be payable on demand.
Term Sheet
----------
<PAGE>
-5-
Facility Fee Facility fee shall accrue on the daily
------------
aggregate amount of the commitments under the
Facility (whether or not utilized), for each
day from and including the date of the
definitive credit agreement to but excluding
the date such commitment is terminated, at
the rate specified below.
Facility Fee and
Interest Margins The applicable facility fee and interest
----------------
margins shall be as follows:
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
I II III IV V VI
- -- --- -- - --
Rating A or A2 A- and A3 BBB+ and Baa1 BBB and Baa2 BBB- and Baa3 < BBB- or < Baa3 or NR
Level
Facility .08% .10% .135% .17% .20% .275%
Fee
CD .295% .325% .365% .40% .45% .475%
Margin
LIBOR .17% .20% .24% .275% .325% .35%
Margin
</TABLE>
Pricing for the Facility shall be at Rating Level VI until the
Initial Facility Reduction Date. Following the Initial Facility
Reduction Date, so long as either Moody's Investor Services and
Standard and Poor's have not announced revised or reaffirmed the
senior unsecured long-term debt ratings of the Company, pricing
shall be at Rating Level IV. Thereafter, pricing shall be
determined according to the lower of the Company's outstanding
senior unsecured long-term debt ratings as established by Moody's
Investor Services and Standard and Poor's, except that the higher
rating shall apply in the case in which the Company's ratings are
A and A3 or A- and A2; provided that, if the rating level as
first so established after the Initial Facility Reduction Date is
below Rating Level IV, such lower Rating Level will apply
retroactively from the Initial Facility Reduction Date.
Voluntary Facility
Reductions and
Prepayments Permitted in whole or in part, with prior
-----------
notice but without premium or penalty (except
for LIBOR or CD breakage costs, if any), in
minimum amounts of $25,000,000 and multiples
of $5,000,000 in excess thereof. Competitive
Bid loans may not be prepaid.
Mandatory
Facility
Reductions Upon the issuance by the Company or any of
----------
its subsidiaries for cash of any debt
maturing on or after the Final Maturity
(other than (i) refinancing of existing debt
of foreign subsidiaries or of the Company's
$75,000,000 8 1/4% Notes due 1996 and (ii) up to
$25,000,000 of domestic economic development
financing) or of any equity (other than in
each case inter-company), the Facility shall
be reduced by an amount equal to the net cash
proceeds thereof.
Term Sheet
----------
<PAGE>
-6-
Application of
Facility
Reductions Until the Facility is reduced to
----------
$1,000,000,000, all voluntary and mandatory
Facility reductions will reduce the amount by
which the Facility is scheduled to be reduced
on the Initial Facility Reduction Date.
Thereafter, the amount of any voluntary or
mandatory Facility reduction will reduce the
remaining regularly scheduled reductions
ratably.
Documentation The Facility will be subject to the
-------------
negotiation, execution and delivery of a
definitive credit agreement (including
schedules, exhibits and ancillary
documentation) and related pledge agreement,
guarantee and other support documentation
satisfactory to the Lenders. Such credit
agreement will contain representations and
warranties, funding and yield protection
provisions (including, without limitation, a
requirement for compensation for the cost of
compliance by the Lenders with capital
adequacy and similar requirements),
conditions precedent, covenants, events of
default reasonably consistent with those
contained in the Existing Credit Agreement
and other provisions determined to be
appropriate for transactions of this type,
including (without limitation) the following:
A. Conditions
Precedent Conditions precedent to the initial
---------
borrowing under the Facility will
include (without limitation):
1. Terms and conditions of the Tender
Offer shall be in form and
substance satisfactory to the
Lenders in their reasonable
determination (including, without
limitation, conditions that (i) any
"poison pill" of the Target be
redeemed or otherwise rendered
inapplicable to the Tender Offer,
(ii) Section 203 of the Delaware
General Corporation Law not prevent
the Merger from being consummated
within 180 days after the Tender
Term Sheet
----------
<PAGE>
-7-
Offer Closing Date and (iii) the
Purchaser shall own and control the
number of shares of the Target's
common stock as shall be necessary
to approve the Merger without the
affirmative vote or approval of any
other shareholders); the principal
conditions to the consummation of
the Tender Offer shall have been
satisfied and shall not have been
waived (for which purpose
conditions that must be fulfilled
to the satisfaction of the
Purchaser must also be fulfilled to
the satisfaction of the Lenders in
their reasonable determination);
and the tendered shares shall have
been accepted for payment pursuant
to the Tender Offer in accordance
with the terms of the Tender Offer.
2. There shall have been accepted for
payment pursuant to the Tender
Offer sufficient shares of the
Target for the Purchaser to be able
to approve the consummation of the
Merger without the affirmative vote
of any other shareholder(s) of the
Target.
3. The Lenders' satisfaction that all
necessary licenses, permits and
governmental and third-party
filings, consents and approvals for
the Acquisition and the Merger have
been obtained and remain in full
force and effect.
4. The Tender Offer and the financing
thereof shall be in compliance with
all laws and regulations
(including, without limitation, the
margin regulations).
Conditions precedent to each extension
of credit under the Facility will be
reasonably consistent with those
contained in the Existing Credit
Agreement.
Term Sheet
----------
<PAGE>
-8-
B. Covenants Covenants will be reasonably consistent
---------
with those contained in the Existing
Credit Agreement; provided that (a) at
any time that the Company's senior
unsecured long-term debt is rated below
BBB- by S&P or below Baa3 by Moody's,
subsidiary debt (other than inter-
company debt) shall not exceed
$600,000,000 in the aggregate, (b) until
the Initial Facility Reduction Date,
total debt of the Company and its
subsidiaries (including the Target and
its subsidiaries) will not exceed
$2,500,000,000 and (c) consolidated
shareholders' equity of the Company and
its subsidiaries will be not less than
the sum of (i) $1,100,000,000 plus (ii)
40% of cumulative quarterly consolidated
net earnings since December 31, 1994
plus (iii) 75% of the cumulative
additions to consolidated shareholders'
equity resulting from equity issuances
after December 31, 1994. Calculations
for minimum consolidated shareholders'
equity will be adjusted to eliminate the
effect of one time pre-tax non-cash
special charges to income during the
period of 18 months after the Tender
Offer Closing Date of up to $50,000,000
in connection with the Acquisition.
C. Events of
Default Events of Default will be reasonably
-------
consistent with those contained in the
Existing Credit Agreement.
Assignments and
Participations Rights reasonably consistent with those
--------------
contained in the Existing Credit
Agreement.
Expenses and
Indemnification As specified in the Commitment Letter.
---------------
Term Sheet
----------
<PAGE>
-9-
Majority Lenders 66-2/3%.
----------------
Governing Law The law of the State of New York
-------------
Chase's
New York Counsel Milbank, Tweed, Hadley & McCloy
----------------
Term Sheet
----------
EXHIBIT 11(g)
<PAGE>
Richard J. Holwell (RJH-5098)
Robert M. Kelly (RMK-7204)
WHITE & CASE
1155 Avenue of the Americas
New York, New York 10036
Telephone: (212) 819-8200
Attorneys for Plaintiff
Clark Equipment Company
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF NEW YORK
-----------------------------------x
:
CLARK EQUIPMENT COMPANY, : 95 Civ. 2130 (CSH) :
Plaintiff, :
:
-against- :
:
INGERSOLL-RAND COMPANY, : COMPLAINT
---------
:
Defendant. :
:
-----------------------------------x
Plaintiff, Clark Equipment Company ("Clark") complaining against
defendant, Ingersoll-Rand Company ("Ingersoll"), alleges as follows:
NATURE OF THE ACTION
--------------------
1. This action arises from an offer to purchase Clark's stock
which was publicly announced by defendant on March 28, 1995.
2. Plaintiff claims that the offer, if consummated, will violate
the federal antitrust laws.
3. Plaintiff seeks an injunction prohibiting defendant from
taking any further action to acquire control of Clark.
<PAGE>
2
JURISDICTION AND VENUE
----------------------
4. This Court has subject matter jurisdiction pursuant to Section
16 of the Clayton Act, 15 U.S.C. Sec. 26, and Sections 1331 and 1337 of the
Judicial Code, 28 U.S.C. Sec.Sec. 1331 and 1337.
5. Venue is proper in this District pursuant to Section 12 of the
Clayton Act, 15 U.S.C. Sec. 22, and Section 1391 of the Judicial Code, 28
U.S.C. Sec. 1391. Plaintiff and defendant both transact business in this
District.
THE PARTIES
-----------
6. Plaintiff Clark is a corporation organized and existing under
the laws of Delaware and having its principal place of business in Indiana.
Clark is engaged in the business of designing, manufacturing and selling
various machinery and equipment, including self-propelled asphalt paving
equipment. Clark is a publicly held corporation and its stock is listed and
traded on the New York Stock Exchange.
7. Defendant Ingersoll is a corporation organized and existing
under the laws of New Jersey and having its principal place of business in
New Jersey. Ingersoll is engaged in the business of designing, manufacturing
and selling various machinery and equipment, including self-propelled asphalt
paving equipment. Ingersoll is a publicly held corporation and its stock is
listed and traded on the New York Stock Exchange.
<PAGE>
3
THE ASPHALT PAVING INDUSTRY
---------------------------
8. One of the principal lines of business in which both plaintiff
Clark and defendant Ingersoll are engaged is the design, manufacture and sale
of self-propelled asphalt paving equipment.
9. Asphalt paving equipment is used principally for purposes of
paving roads and highways. The bulk of the work for which such equipment is
used consists of public works projects that are performed by private
contractors pursuant to competitive bidding awards. In addition, a lesser
proportion of asphalt paving equipment is sold directly to governmental
agencies for highway and road maintenance purposes. A certain portion of
asphalt paving work (which is usually done by private paving contractors)
consists of paving large parking lots. Finally, a certain proportion of
asphalt paving work (which is typically done by private paving contractors
using a different type of equipment) consists of paving small projects such
as driveways, bike and golf paths and small parking lots.
10. Due to differences in applications, the asphalt paving
equipment industry can be divided into distinct market segments depending
upon the size of the equipment manufactured and sold.
11. For purposes of this lawsuit, the relevant product market
consists of large asphalt pavers, i.e., those weighing more than
approximately 15,000 pounds. Asphalt pavers in this market classification
are used for large scale projects such as road paving, highway construction,
and large parking lots.
<PAGE>
4
12. For purposes of this lawsuit, the relevant geographic market
consists of all asphalt pavers in the relevant product market which are sold
for use in the United States. The relevant product market and the relevant
geographic market will hereafter be referred to collectively as "the Relevant
Market."
13. Within the Relevant Market, there are two separate product
submarkets: (1) asphalt pavers weighing approximately 15,000 to 30,000 pounds
and (2) asphalt pavers weighing more than 30,000 pounds. For purposes of
this lawsuit, the relevant product submarket market consists of asphalt
pavers weighing approximately 15,000 to 30,000 pounds. The relevant product
submarket will hereafter be referred to as "the Relevant Submarket."
14. Plaintiff Clark and defendant Ingersoll are direct competitors
in the Relevant Market and Submarket.
15. Plaintiff Clark is the largest supplier of asphalt pavers in
the Relevant Market and Submarket. Plaintiff presently controls a market
share of approximately 30 percent of the Relevant Market and more than 45
percent of the Relevant Submarket.
16. Defendant Ingersoll presently controls a market share of
approximately 10 percent of the Relevant Market and more than 25 percent of
the Relevant Submarket.
17. The Relevant Market is highly concentrated. In addition to
Clark and Ingersoll, only three other companies compete in the Relevant
Market: (1) Caterpillar Paving Products, Inc. (including its wholly-owned
subsidiary Barber-Greene Company), (2) Cedarapids, Inc. (which is a
wholly-owned
<PAGE>
5
subsidiary of Raytheon Company), and (3) Roadtec, Inc. (which is a
wholly-owned subsidiary of Astec Industries, Inc.).
18. The Relevant Submarket is even more concentrated. In addition
to Clark and Ingersoll, only two companies compete in the Relevant Submarket:
Caterpillar and Cedarapids.
19. In addition to the unusually high levels of concentration, the
Relevant Market and Submarket have significant barriers to entry. For
example, it is necessary to have access to a well-developed dealer network in
order to compete effectively in this market. Due to the high cost of
downtime and machine malfunction, customers insist on a reliable dealer
network to service machines and supply replacement parts. Dealers normally
handle one supplier's product line exclusively and, because of the importance
of parts sales, dealers have a strong incentive to stay with an existing
supplier with an established market share rather than switch to a new
supplier. The resulting lack of access to an established distribution
network was a significant factor in the unsuccessful attempt of several
foreign manufacturers to enter the U.S. market.
20. The cost and inconvenience of having to train operators and
maintenance personnel in new equipment, customer loyalty to established
product lines, and interchange of replacement parts with existing product
base also constitute significant barriers to entry in the Relevant Market and
Submarket.
21. Should Ingersoll acquire Clark, the level of concentration in
both the Relevant Market and Submarket would radically increase. The
combined entity would have a market share of more than 50 percent in the
Relevant Market and more
<PAGE>
6
than 65 percent of the Relevant Submarket. In light of these market shares
and given the significant barriers to entry in the industry, the proposed
acquisition would substantially lessen competition and tend to create a
monopoly in the Relevant Market and Submarket.
THE OFFER
---------
22. On March 28, 1995, defendant Ingersoll publicly announced that
it had made an offer to acquire control of Clark. James Perrella,
Ingersoll's Chairman and Chief Executive Officer, sent a letter to Clark
indicating that Ingersoll intended to proceed with its offer. The letter was
publicly released by Ingersoll on March 28, 1995, and on March 29, 1995,
Ingersoll's intention to launch a hostile tender offer was widely reported in
the press, including both The Wall Street Journal and The New York Times.
23. If the tender offer is allowed to proceed and Clark is
acquired by Ingersoll, there will be a massive reduction of competition in,
and defendant's total domination and monopolization of, both the Relevant
Market and the Relevant Submarket.
FIRST CLAIM FOR RELIEF
----------------------
(Violation of Section 7
of the Clayton Act)
-------------------
24. Plaintiff repeats the allegations contained in paragraphs 1
through 23.
25. Clark and Ingersoll are both engaged in commerce and in
activities affecting commerce.
<PAGE>
7
26. The effect of the proposed acquisition of Clark by Ingersoll
will be substantially to lessen competition and tend to create a monopoly in
the Relevant Market and Submarket.
27. Defendant is thereby threatening to violate Section 7 of the
Clayton Act, 15 U.S.C. Sec. 18.
28. Plaintiff will sustain irreparable injury by reason of
defendant's threatened violation of the antitrust laws and is entitled to the
relief requested herein.
29. Plaintiff has no adequate remedy at law.
SECOND CLAIM FOR RELIEF
-----------------------
(Violation of Section 2
of the Sherman Act)
-----------------------
30. Plaintiff repeats the allegations contained in paragraphs 1
through 29.
31. Defendant, acting with specific intent to do so, is attempting
to monopolize the Relevant Market and Submarket.
32. There is a dangerous probability that defendant will achieve
monopoly power in the Relevant Market and Submarket through its actions.
33. As a result of the forgoing acts, defendant has violated and,
unless enjoined by this Court, will continue to violate Section 2 of the
Sherman Act, 15 U.S.C. Sec. 2.
34. Plaintiff will sustain irreparable injury by reason of
defendants' violation of the antitrust laws and is entitled to the relief
requested herein.
35. Plaintiff has no adequate remedy at law.
WHEREFORE, plaintiff respectfully prays that judgment be entered as
follows:
<PAGE>
8
(a) Declaring that the proposed acquisition of plaintiff by
defendant violates Section 7 of the Clayton Act and Section 2 of the Sherman
Act;
(b) Preliminarily and permanently enjoining defendant, its
officers, directors, employees and agents, and all other persons acting on
their behalf or in concert with them, from proceeding with the proposed
tender offer;
(c) Granting plaintiff its costs and disbursements in this action,
including attorneys' fees; and
(d) Granting plaintiff such other and further relief as the Court
deems appropriate.
Dated: New York, New York
March 29, 1995
WHITE & CASE
By: /s/ Richard J. Holmwell
-----------------------------
Richard J. Holwell (RJM-5098)
Robert M. Kelly (RMK-7204)
1155 Avenue of the Americas
New York, New York 10036
Telephone (212) 819-8200
Attorneys for Plaintiff
Clark Equipment Company
