SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
__________________
AMENDMENT NO. 2
TO
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
<PAGE>
This Amendment No. 2 amends and supplements the Tender Offer
Statement on Schedule 14D-1 filed on April 3, 1995 (as amended, the "Schedule
14D-1") relating 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"), and in the
related Letter of Transmittal. Unless otherwise indicated, all capitalized
terms used but not defined herein shall have the meanings assigned to them in
the Schedule 14D-1.
Item 3. Past Contacts, Transactions or Negotiations with the Subject Company.
Item 3(b) of the Schedule 14D-1 is hereby amended and supplemented as
follows:
On April 9, 1995, following negotiations between the Company and the
Parent from April 7, 1995 to April 9, 1995, the Company and the Parent executed
an Agreement and Plan of Merger dated as of April 9, 1995 (the "Merger
Agreement") and issued a joint press release announcing execution of the Merger
Agreement. Copies of such press release, the Merger Agreement and a Letter of
Intent executed by the Parent and the Company in connection therewith are set
forth as Exhibit (a)(10), (c)(1) and (c)(2), respectively, and each is
incorporated herein by reference.
Item 5. Purpose of the Tender Offer and Plans or Proposals of the Bidder.
Item of the Schedule 14D-1 is hereby amended and supplemented as follows:
The information provided in this Amendment No. 2 under Item 3 is hereby
incorporated by reference.
Item 7. Contracts, Arrangements, Understandings or Relationships with Respect
to the Subject Company's Securities.
Item 7 of the Schedule 14D-1 are hereby amended and supplemented as
follows:
The information provided in this Amendment No. 2 under Item 3 is hereby
incorporated by reference.
Item 11. Material to be Filed as Exhibits.
Item 11 is hereby amended and supplemented to add the following:
<PAGE>
(a)(10) Joint Press Release issued by the Parent and the Company on
April 9, 1995.
(c)(1) Agreement and Plan of Merger, dated as of April 9, 1995,
among the Company, the Parent and the Purchaser.
(c)(2) Letter of Intent, dated as of April 9, 1995, between the
Company and the Parent.
<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/ Thomas F. McBride
Name: Thomas F. McBride
Title: President
Date: April 10, 1995
<PAGE>
EXHIBIT INDEX
Exhibit Page
No. Description No.
(a)(9) Press Release issued by the Parent on April 4, 1995 .
(c)(1) Agreement and Plan of Merger, dated as of April 9,
1995, among the Company, the Parent and the
Purchaser . . . . . . . . . . . . . . . . . . . . .
(c)(2) Letter of Intent, dated as of April 9, 1995, between
the Company and the Parent . . . . . . . . . . . . .
[INGERSOLL-RAND LOGO]NEWS
Corporate Communications
Woodcliff Lake, New Jersey 07675
CONTACT:FOR RELEASE:
Thomas F. McBride For Immediate Release
Senior Vice President
and Chief Financial Officer
(201) 573-3486
INGERSOLL-RAND AND CLARK EQUIPMENT
REACH MERGER AGREEMENT
Woodcliff Lake, N.J. and South Bend, Indiana (April 9, 1995) --
Ingersoll-Rand Company and Clark Equipment Company jointly announced today that
they have entered into a definitive merger agreement under which Ingersoll-Rand
will acquire Clark for $86.00 per share in cash. The Boards of Directors of
both companies have unanimously approved the agreement.
Ingersoll-Rand's pending tender offer is being amended to increase the
offering price to $86.00 per share and extend the expiration date to midnight
New York time on Friday, May 5, 1995.
"We're delighted to add Clark's strong businesses and fine people to our
own," said James E. Perrella, Chairman, President and Chief Executive Officer
of Ingersoll-Rand. "This is a great fit. Clark's businesses complement
Ingersoll-Rand's and, like ours, are well-managed leaders in their sectors."
Clark's Chairman, President and Chief Executive Officer, Leo J.
McKernan, said "This merger delivers fair value to our shareholders and also
provides our employees with excellent opportunities within the framework of a
fine company like Ingersoll-Rand."
Consummation of the merger is subject to customary terms and conditions,
including regulatory approvals.
# # #
Additional contact:
Clark & Weinstock Inc. (212) 953-2550
Davis Weinstock
Gene Donati
Carol Phethean
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
INGERSOLL-RAND COMPANY,
CEC ACQUISITION CORP.
AND
CLARK EQUIPMENT COMPANY
Dated as of April 9, 1995
<PAGE>
AGREEMENT AND PLAN OF MERGER
TABLE OF CONTENTS
Page
ARTICLE I THE OFFER . . . . . . . . . . . . . . . . . . . . . . . 2
1.01 The Offer . . . . . . . . . . . . . . . . . . . . . . . 2
1.02 Company Actions . . . . . . . . . . . . . . . . . . . . 3
ARTICLE II THE MERGER AND RELATED MATTERS . . . . . . . . . . . . 5
2.01 The Merger . . . . . . . . . . . . . . . . . . . . . . 5
2.02 Conversion of Stock . . . . . . . . . . . . . . . . . . 5
2.03 Dissenting Stock . . . . . . . . . . . . . . . . . . . 6
2.04 Surrender of Certificates . . . . . . . . . . . . . . . 6
2.05 Payment . . . . . . . . . . . . . . . . . . . . . . . . 7
2.06 No Further Rights of Transfers . . . . . . . . . . . . 8
2.07 Stock Option and Other Plans . . . . . . . . . . . . . 8
2.08 Certificate of Incorporation of the Surviving
Corporation . . . . . . . . . . . . . . . . . . . . . 9
2.09 By-Laws of the Surviving Corporation . . . . . . . . . 9
2.10 Directors and Officers of the Surviving Corporation . . 10
2.11 Closing . . . . . . . . . . . . . . . . . . . . . . . . 10
ARTICLE III REPRESENTATIONS AND WARRANTIES . . . . . . . . . . . . 10
3.01 Representations and Warranties of the Company . . . . . 10
(a) Due Organization, Good Standing and Corporate Power 10
(b) Authorization and Validity of Agreement . . . . . 11
(c) Capitalization . . . . . . . . . . . . . . . . . . 11
(d) Consents and Approvals; No Violations . . . . . . 12
(e) Company Reports and Financial Statements . . . . . 13
(f) Absence of Other Liabilities . . . . . . . . . . . 14
(g) Anticipated Filings . . . . . . . . . . . . . . . 14
(h) Absence of Certain Changes . . . . . . . . . . . . 14
(i) Compliance with Laws . . . . . . . . . . . . . . . 15
(j) Litigation . . . . . . . . . . . . . . . . . . . . 15
(k) Employee Benefit Plans . . . . . . . . . . . . . . 16
(l) Taxes . . . . . . . . . . . . . . . . . . . . . . 16
(m) Proxy Statement, Schedule 14D-9 and Schedule 14D-1 17
(n) Broker's or Finder's Fee . . . . . . . . . . . . . 17
(o) Environmental Laws and Regulations . . . . . . . . 18
(p) State Takeover Statutes and Supermajority Voting
Provisions . . . . . . . . . . . . . . . . . . . 18
(q) Rights Agreement . . . . . . . . . . . . . . . . . 18
3.02 Representations and Warranties of Parent and Purchaser . 18
(a) Due Organization; Good Standing and Corporate Power 18
(b) Authorization and Validity of Agreement . . . . . 19
(c) Consents and Approvals; No Violations . . . . . . 19
(d) Offer Documents, Schedule 14D-9 and Proxy Statement 20
<PAGE>
(e) Broker's or Finder's Fee . . . . . . . . . . . . . 20
(f) Financing . . . . . . . . . . . . . . . . . . . . 21
ARTICLE IV TRANSACTIONS PRIOR TO CLOSING DATE . . . . . . . . . . . . 21
4.01 Access to Information Concerning Properties and Records 21
4.02 Confidentiality . . . . . . . . . . . . . . . . . . . . 21
4.03 Conduct of the Business of the Company Pending the
Closing Date . . . . . . . . . . . . . . . . . . . . 21
4.04 Proxy Statement . . . . . . . . . . . . . . . . . . . . 24
4.05 Stockholder Approval . . . . . . . . . . . . . . . . . 24
4.06 Reasonable Best Efforts . . . . . . . . . . . . . . . . 24
4.07 Guarantee of Performance . . . . . . . . . . . . . . . 25
4.08 Notification of Certain Matters . . . . . . . . . . . . 25
4.09 HSR Act . . . . . . . . . . . . . . . . . . . . . . . . 25
4.10 Employee Benefits . . . . . . . . . . . . . . . . . . . 25
4.11 Directors' and Officers' Insurance; Indemnification . . 28
4.12 Financing . . . . . . . . . . . . . . . . . . . . . . . 29
4.13 Company Board Representation; Section 14(f) . . . . . . 29
4.14 No Amendment to the Rights Agreement . . . . . . . . . 30
4.15 Disposition of Litigation . . . . . . . . . . . . . . . 30
4.16 Proxy Contests . . . . . . . . . . . . . . . . . . . . 30
4.17 No Solicitation of Transactions . . . . . . . . . . . . 31
4.18 Postponement of Annual Meeting . . . . . . . . . . . . 32
4.19 Sale of VME . . . . . . . . . . . . . . . . . . . . . . 32
ARTICLE V CONDITIONS PRECEDENT TO MERGER . . . . . . . . . . . . . . . 32
5.01 Conditions Precedent to Obligations of Parent, Purchaser
and the Company . . . . . . . . . . . . . . . . . . . 32
(a) Approval of Company's Stockholders . . . . . . . . 33
(b) HSR Act . . . . . . . . . . . . . . . . . . . . . 33
(c) Injunction . . . . . . . . . . . . . . . . . . . . 33
(d) Statutes . . . . . . . . . . . . . . . . . . . . . 33
(e) Payment for Common Stock . . . . . . . . . . . . . 33
ARTICLE VI TERMINATION AND ABANDONMENT . . . . . . . . . . . . . . . . 33
6.01 Termination . . . . . . . . . . . . . . . . . . . . . . 33
6.02 Effect of Termination . . . . . . . . . . . . . . . . . 36
ARTICLE VII MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . 36
7.01 Fees and Expenses . . . . . . . . . . . . . . . . . . . 36
7.02 Extension; Waiver . . . . . . . . . . . . . . . . . . . 37
7.03 Public Announcements . . . . . . . . . . . . . . . . . 37
7.04 Notices . . . . . . . . . . . . . . . . . . . . . . . . 37
7.05 Entire Agreement . . . . . . . . . . . . . . . . . . . 38
7.06 Binding Effect; Benefit; Assignment . . . . . . . . . . 38
7.07 Amendment and Modification . . . . . . . . . . . . . . 39
7.08 Further Actions . . . . . . . . . . . . . . . . . . . . 39
7.09 Headings . . . . . . . . . . . . . . . . . . . . . . . 39
7.10 Counterparts . . . . . . . . . . . . . . . . . . . . . 39
7.11 Applicable Law . . . . . . . . . . . . . . . . . . . . 39
7.12 Severability . . . . . . . . . . . . . . . . . . . . . 39
7.13 "Person" Defined . . . . . . . . . . . . . . . . . . . 40
7.14 Knowledge of the Company . . . . . . . . . . . . . . . 40
7.15 Non-Survival of Representations, Warranties and
Agreements . . . . . . . . . . . . . . . . . . . . . 40
Annexes
Annex A Tender Offer Conditions
<PAGE>
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of April 9, 1995 (this
"Agreement"), by and among INGERSOLL-RAND COMPANY, a New Jersey corporation
("Parent"), CEC ACQUISITION CORP., a Delaware corporation and a wholly-owned
subsidiary of Parent ("Purchaser"), and CLARK EQUIPMENT COMPANY, a Delaware
corporation (the "Company").
WHEREAS, the respective Boards of Directors of Parent, Purchaser
and the Company have approved the acquisition of the Company by Parent;
WHEREAS, Purchaser has outstanding an offer (such offer as
amended pursuant to this Agreement is hereinafter referred to as the "Offer")
to purchase all of the outstanding shares of Common Stock, $7.50 par value per
share, of the Company (the "Common Stock"; all of the outstanding shares of
Company Common Stock being hereinafter referred to as "Shares") and the
associated Preferred Stock Purchase Rights (the "Rights") issued pursuant to
the Rights Agreement dated as of March 10, 1987, and amended and restated, as
of August 14, 1990, between the Company and Harris Trust & Savings Bank, as
Rights Agent (as so amended and restated, the "Rights Agreement"), at a
purchase price of $77 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, and in the related
letter of transmittal;
WHEREAS, in consideration of the Company's entering into this
Agreement, Parent is willing to cause Purchaser to increase the price to be
paid pursuant to the Offer to $86.00 per Share (and associated Right) (such
amount being hereinafter referred to as the "Offer Price");
WHEREAS, to complete such acquisition, the respective Boards of
Directors of Parent, Purchaser and the Company, have approved the merger of
Purchaser with the Company (the "Merger"), pursuant to and subject to the terms
and conditions of this Agreement; and
WHEREAS, the Directors of the Company have unanimously
determined that each of the Offer and the Merger are fair to, and in the best
interests of, the holders of Common Stock, approved this Agreement, the Offer
and the Merger and recommended the acceptance of the Offer and approval and
adoption of this Agreement by the stockholders of the Company.
NOW, THEREFORE, in consideration of the premises and of the
mutual covenants, representations, warranties and agreements herein contained,
the parties hereto agree as follows:
ARTICLE I
THE OFFER
1.01 The Offer. (a) Provided that this Agreement
shall not have been terminated in accordance with Article VI hereof and so long
as none of the events set forth in Annex A hereto (the "Tender Offer
Conditions") shall have occurred and no circumstance shall exist which would
<PAGE>
result in a failure to satisfy any of the Tender Offer Conditions, as promptly
as practicable, but in no event later than the fifth business day after the
date of this Agreement, Purchaser shall amend the Offer (i) to extend the Offer
to May 5, 1995, (ii) to increase the purchase price offered to $86.00 per share
of Common Stock (and associated Right) and (iii) to modify the conditions of
the Offer to conform to the Tender Offer Conditions. The obligations of
Purchaser to accept for payment and promptly to pay for any shares of Common
Stock tendered shall be subject only to the Tender Offer Conditions any of
which may be waived; provided, however, that, without the consent of the
Company, Purchaser shall not waive the condition that there shall have been
validly tendered and not withdrawn prior to the expiration of the Offer a
number of shares of Common Stock which, together with Common Stock owned by
Parent and Purchaser, represent a majority of the total voting power of all
shares of capital stock of the Company outstanding on a fully diluted basis.
The Tender Offer Conditions are for the sole benefit of Parent and Purchaser
and may be asserted by Parent and Purchaser regardless of the circumstances
giving rise to any such Tender Offer Conditions and, subject to the preceding
sentence, may be waived by Parent and Purchaser in whole or in part. Without
the consent of the Company, Purchaser shall not (i) reduce the number of shares
of Company Common Stock to be purchased in the Offer, (ii) reduce the Offer
Price, (iii) impose conditions to the Offer in addition to those set forth in
Annex A, (iv) change the form of consideration payable in the Offer or (v)
amend any other term of the Offer (including the Tender Offer Conditions) in a
manner materially adverse to the holders of the Common Stock. Parent and
Purchaser covenant and agree that, subject to the terms and conditions of this
Agreement, including but not limited to the Tender Offer Conditions, unless the
Company otherwise consents in writing, Purchaser will accept for payment and
pay for Common Stock as soon as it is permitted to do so under applicable law;
provided, that Purchaser shall have the right, in its sole discretion, to
extend the Offer from time to time for up to a maximum of 10 additional
business days, notwithstanding the prior satisfaction of the Tender Offer
Conditions.
(b) As soon as practicable after the date hereof, Parent
or Purchaser shall file with the Securities and Exchange Commission (the
"Commission") an amendment to their Tender Offer Statement on Schedule 14D-1
dated April 3, 1995 with respect to the Offer which will reflect the existence
of this Agreement, amend the conditions to the Offer in accordance herewith and
contain a supplement to the Offer to Purchase dated April 3, 1995 and related
letter of transmittal (together with any supplements or amendments thereto,
collectively the "Offer Documents"). The Offer Documents will comply in all
material respects with the provisions of applicable federal securities laws.
The information provided and to be provided by the Company, Parent and
Purchaser for use in the Offer Documents shall not, on the date filed with the
Commission and on the date first published or sent or given to the Company's
stockholders, as the case may be, contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or neces-
sary in order to make the statements therein, in light of the circumstances
under which they were made, not misleading. Parent, Purchaser and the Company
each agrees promptly to correct any information provided by it for use in the
Offer Documents if and to the extent that it shall have become false or
misleading in any material respect and Parent and Purchaser further agree to
take all steps necessary to cause the Offer Documents as so corrected to be
filed with the Commission and to be disseminated to holders of Common Stock, in
each case as and to the extent required by applicable federal securities laws.
-2-
<PAGE>
1.02 Company Actions. (a) The Company hereby
approves of and consents to the Offer and the Merger and represents that (i)
its Board of Directors (at a meeting duly called and held on April 9, 1995) has
(1) determined by the unanimous vote of the Directors that each of the
transactions contemplated hereby, including each of the Offer and the Merger,
is fair to, and in the best interests of, the holders of Common Stock, (2)
approved this Agreement and the transactions contemplated hereby, including
each of the Offer and the Merger and has determined that the consummation of
any thereof will not constitute a "Change In Control" for purposes of Section
9.2 of the Clark Equipment Company Leveraged Employee Stock Ownership Plan, (3)
resolved to recommend acceptance of the Offer and the tender of Shares
thereunder and approval and adoption of this Agreement and the transactions
contemplated hereby by the stockholders of the Company, (4) taken all other
action necessary to render (A) Section 203 of the Delaware General Corporation
Law, (B) the Rights Agreement and (C) Article SIXTH, Paragraph 6, of the
Company's Restated Certificate of Incorporation (as to the Company, the
"Certificate of Incorporation") inapplicable to the Offer and the Merger and
the transactions contemplated hereby and thereby; provided, however, that such
recommendation or other action may be withdrawn, modified or amended at any
time or from time to time if a majority of the Board of Directors of the
Company determines, in its good faith judgment, based on the opinion of
independent outside legal counsel to the Company, that failing to take such
action would constitute a breach of such Board's fiduciary obligations under
applicable law; and (ii) CS First Boston Corporation ("First Boston") has
delivered to the Board of Directors of the Company its opinion that the
consideration to be received by the holders of Common Stock (other than Parent
and Purchaser) pursuant to the Offer and the Merger is fair to the holders of
Common Stock from a financial point of view. The Company has been authorized
by First Boston to permit, subject to prior review and consent by First Boston
(such consent not to be unreasonably withheld), the inclusion of such fairness
opinion (or a reference thereto) in the Offer Documents and in the Schedule
14D-9 referred to below and the Proxy Statement referred to in Section 4.04.
The Company hereby consents to the inclusion in the Offer Documents of the
recommendations of the Company's Board of Directors described in this Section
1.02(a).
(b) The Company hereby agrees to file with the
Commission as soon as practicable after the date hereof a
Solicitation/Recommendation Statement on Schedule 14D-9 pertaining to the Offer
(together with any amendments or supplements thereto, the "Schedule 14D-9")
containing the recommendation described in Section 1.02(a) and to promptly mail
the Schedule 14D-9 to the stockholders of the Company. The Schedule 14D-9 will
comply in all material respects with the provisions of applicable federal
securities laws and, on the date filed with the Commission and on the date
first published, sent or given to the Company's stockholders, shall not contain
any untrue statement of a material fact or omit to state any material fact re-
quired to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they were made, not mislead-
ing, except that no representation is made by the Company with respect to
information supplied by Parent or Purchaser in writing for inclusion in the
Schedule 14D-9. The Company, Parent and Purchaser each agrees promptly to
correct any information provided by it for use in the Schedule 14D-9 if and to
the extent that it shall have become false or misleading in any material
respect and the Company further agrees to take all steps necessary to cause the
Schedule 14D-9 as so corrected to be filed with the Commission and disseminated
-3-
<PAGE>
to the holders of shares of Common Stock, in each case as and to the extent
required by applicable federal securities laws; provided, however, that such
recommendation or other action may be withdrawn, modified or amended at any
time or from time to time if a majority of the Board of Directors of the
Company determines, in its good faith judgment, based on the opinion of
independent outside legal counsel to the Company, that failing to take such
action would constitute a breach of such Board's fiduciary obligations under
applicable law.
(c) In connection with the Offer, the Company will
promptly furnish Purchaser with mailing labels, security position listings, any
non-objecting beneficial owner lists and any available listing or computer list
containing the names and addresses of the record holders of the Common Stock as
of the most recent practicable date and shall furnish Purchaser with such
additional information (including, but not limited to, updated lists of holders
of Common Stock and their addresses, mailing labels and lists of security posi-
tions and non-objecting beneficial owner lists) and such other assistance as
Purchaser or its agents may reasonably request in communicating the Offer to
the Company's record and beneficial stockholders. Subject to the requirements
of applicable law, and except for such steps as are necessary to disseminate
the Offer Documents and any other documents necessary to consummate the Merger,
the Parent, Purchaser and their affiliates, associates, agents and advisors,
shall keep such information confidential and use the information contained in
any such labels, listings and files only in connection with the Offer and the
Merger and, if this Agreement shall be terminated, will deliver to the Company
all copies of such information then in their possession.
ARTICLE II
THE MERGER AND RELATED MATTERS
2.01 The Merger. (a) Subject to the terms and con-
ditions of this Agreement, at the time of the Closing (as defined in Section
2.11 hereof), a certificate of merger (the "Certificate of Merger") shall be
duly prepared, executed and acknowledged by Purchaser and the Company in
accordance with Delaware General Corporation Law and shall be filed on the
Closing Date (as defined in Section 2.11 hereof). The Merger shall become
effective upon the filing of the Certificate of Merger with the Secretary of
State of the State of Delaware in accordance with the provisions and require-
ments of the Delaware General Corporation Law. The date and time when the
Merger shall become effective is hereinafter referred to as the "Effective
Time."
(b) At the Effective Time, Purchaser shall be merged
with and into the Company and the separate corporate existence of Purchaser
shall cease, and the Company shall continue as the surviving corporation under
the laws of the State of Delaware under the name of "Clark Equipment Company"
(the "Surviving Corporation"). At Parent's election, the Merger may
alternatively be structured so that (i) the Company is merged with and into
Parent, Purchaser or any other direct or indirect subsidiary of Parent or (ii)
any direct or indirect subsidiary of Parent other than Purchaser is merged with
and into the Company. In the event of such an election, the parties agree to
execute an appropriate amendment to this Agreement in order to reflect such
election.
-4-
<PAGE>
(c) From and after the Effective Time, the Merger shall
have the effects set forth in Section 259 of the Delaware General Corporation
Law.
2.02 Conversion of Stock. At the Effective Time:
(a) Each share of Common Stock then issued and
outstanding (other than (i) any shares of Common Stock which are held
by any subsidiary of the Company or in the treasury of the Company, or
which are held, directly or indirectly, by Parent or any direct or
indirect subsidiary of Parent (including Purchaser), all of which shall
be cancelled and none of which shall receive any payment with respect
thereto and (ii) shares of Common Stock held by Dissenting Stockholders
(as defined in Section 2.03 hereof)) shall, by virtue of the Merger and
without any action on the part of Purchaser, the Company or the holder
thereof, be cancelled, extinguished and converted into and represent
the right to receive an amount in cash, without interest, equal to the
price paid for each share of Common Stock pursuant to the Offer (the
"Merger Consideration") payable to the holder thereof less any required
withholding taxes; and
(b) Except as otherwise provided in the next succeeding
sentence, each share of common stock, par value $.01 per share, of
Purchaser then issued and outstanding shall, by virtue of the Merger
and without any action on the part of the holder thereof, become one
validly issued, fully paid and nonassessable share of common stock,
$.01 par value, of the Surviving Corporation.
2.03 Dissenting Stock. Notwithstanding anything in
this Agreement to the contrary but only to the extent required by Delaware
General Corporation Law, shares of Common Stock that are issued and outstanding
immediately prior to the Effective Time and are held by holders of Common Stock
who comply with all the provisions of Delaware law concerning the right of
holders of Common Stock to dissent from the Merger and require appraisal of
their shares of Common Stock ("Dissenting Stockholders") shall not be converted
into the right to receive the Merger Consideration but shall be entitled to
receive such consideration as may be determined to be due such Dissenting
Stockholder pursuant to the law of the State of Delaware; provided, however,
that (i) if any Dissenting Stockholder shall subsequently deliver a written
withdrawal of his or her demand for appraisal (with the written approval of the
Surviving Corporation, if such withdrawal is not tendered within 60 days after
the Effective Time), or (ii) if any Dissenting Stockholder fails to establish
and perfect his or her entitlement to appraisal rights as provided by
applicable law, or (iii) if within 120 days of the Effective Time neither any
Dissenting Stockholder nor the Surviving Corporation has filed a petition
demanding a determination of the value of all shares of Common Stock outstand-
ing at the Effective Time and held by Dissenting Stockholders in accordance
with applicable law, then such Dissenting Stockholder or Stockholders, as the
case may be, shall forfeit the right to appraisal of such shares and such
shares shall thereupon be deemed to have been converted into the right to
receive, as of the Effective Time, the Merger Consideration, without interest.
The Company shall give Parent and Purchaser (A) prompt notice of any written
demands for appraisal, withdrawals of demands for appraisal and any other
related instruments received by the Company, and (B) the opportunity to direct
all negotiations and proceedings with respect to demands for appraisal. The
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Company will not, except with the prior written consent of Parent, voluntarily
make any payment with respect to any demands for appraisal or settle or offer
to settle any demand.
2.04 Surrender of Certificates. (a) Concurrently
with or prior to the Effective Time, Parent shall designate a bank or trust
company located in the United States to act as paying agent (the "Paying
Agent") for purposes of making the cash payments contemplated hereby. As soon
as practicable after the Effective Time, Parent shall cause the Paying Agent to
mail and/or make available to each holder of a certificate theretofore
evidencing shares of Common Stock (other than those which are held by any
subsidiary of the Company or in the treasury of the Company or which are held
directly or indirectly by Parent or any direct or indirect subsidiary of Parent
(including Purchaser)) a notice and letter of transmittal advising such holder
of the effectiveness of the Merger and the procedure for surrendering to the
Paying Agent such certificate or certificates which immediately prior to the
Effective Time represented outstanding Common Stock (the "Certificates") in
exchange for the Merger Consideration deliverable in respect thereof pursuant
to this Article II. Upon the surrender for cancellation to the Paying Agent of
such Certificates, together with a letter of transmittal, duly executed and
completed in accordance with the instructions thereon, and any other items
specified by the letter of transmittal, the Paying Agent shall promptly pay to
the Person entitled thereto the Merger Consideration deliverable in respect
thereof. Until so surrendered, each Certificate shall be deemed, for all
corporate purposes, to evidence only the right to receive upon such surrender
the Merger Consideration deliverable in respect thereof to which such Person is
entitled pursuant to this Article II. No interest shall be paid or accrued in
respect of such cash payments.
(b) If the Merger Consideration (or any portion thereof)
is to be delivered to a Person other than the Person in whose name the
Certificates surrendered in exchange therefor are registered, it shall be a
condition to the payment of the Merger Consideration that the Certificates so
surrendered shall be properly endorsed or accompanied by appropriate stock
powers and otherwise in proper form for transfer, that such transfer otherwise
be proper and that the Person requesting such transfer pay to the Paying Agent
any transfer or other taxes payable by reason of the foregoing or establish to
the satisfaction of the Paying Agent that such taxes have been paid or are not
required to be paid.
(c) In the event any Certificate shall have been lost,
stolen or destroyed, upon the making of an affidavit of that fact by the Person
claiming such Certificate to be lost, stolen or destroyed, the Paying Agent
will issue in exchange for such lost, stolen or destroyed Certificate the
Merger Consideration deliverable in respect thereof as determined in accordance
with this Article II, provided that, the Person to whom the Merger
Consideration is paid shall, as a condition precedent to the payment thereof,
give the Surviving Corporation a bond in such sum as it may direct or otherwise
indemnify the Surviving Corporation in a manner satisfactory to it against any
claim that may be made against the Surviving Corporation with respect to the
Certificate claimed to have been lost, stolen or destroyed.
2.05 Payment. Concurrently with or immediately
prior to the Effective Time, Parent or Purchaser shall deposit in trust with
the Paying Agent cash in United States dollars in an aggregate amount equal to
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the product of (i) the number of shares of Common Stock outstanding immediately
prior to the Effective Time (other than shares of Common Stock which are held
by any subsidiary of the Company or in the treasury of the Company or which are
held directly or indirectly by Parent or any direct or indirect subsidiary of
Parent (including Purchaser) or a Person known at the time of such deposit to
be a Dissenting Stockholder) and (ii) the Merger Consideration (such amount
being hereinafter referred to as the "Payment Fund"). The Payment Fund shall
be invested by the Paying Agent as directed by Parent in direct obligations of
the United States, obligations for which the full faith and credit of the
United States is pledged to provide for the payment of principal and interest,
commercial paper rated of the highest quality by Moody's Investors Services,
Inc. or Standard & Poor's Ratings Group or certificates of deposit, bank
repurchase agreements or bankers' acceptances of a commercial bank having at
least $100,000,000 in assets (collectively, "Permitted Investments") or in
money market funds which are invested in Permitted Investments, and any net
earnings with respect thereto shall be paid to Parent as and when requested by
Parent. The Paying Agent shall, pursuant to irrevocable instructions, make the
payments referred to in Section 2.02(a) hereof out of the Payment Fund. The
Payment Fund shall not be used for any other purpose except as otherwise agreed
to by Parent. Promptly following the date which is three months after the
Effective Time, the Paying Agent shall return to Parent all cash, certificates
and other instruments in its possession that constitute any portion of the
Payment Fund (other than net earnings on the Payment Fund which shall be paid
to Parent), and the Paying Agent's duties shall terminate. Thereafter, each
holder of a Certificate may surrender such Certificate to the Surviving
Corporation and (subject to applicable abandoned property, escheat and similar
laws) receive in exchange therefor the Merger Consideration, without interest,
but shall have no greater rights against the Surviving Corporation or Purchaser
than may be accorded to general creditors of the Surviving Corporation or
Purchaser under applicable law. Notwithstanding the foregoing, neither the
Paying Agent nor any party hereto shall be liable to a holder of a Certificate
for any Merger Consideration delivered to a public official pursuant to
applicable abandoned property, escheat and similar laws.
2.06 No Further Rights of Transfers. At and after
the Effective Time, each holder of a Certificate shall cease to have any rights
as a stockholder of the Company, except for, in the case of a holder of a
Certificate (other than shares to be cancelled pursuant to Section 2.02(a)
hereof and other than shares held by Dissenting Stockholders), the right to
surrender his or her Certificate in exchange for payment of the Merger
Consideration or, in the case of a Dissenting Stockholder, to perfect his or
her right to receive payment for his or her shares pursuant to Delaware law if
such holder has validly perfected and not withdrawn his or her right to receive
payment for his or her shares, and no transfer of shares of Common Stock shall
be made on the stock transfer books of the Surviving Corporation. Certificates
presented to the Surviving Corporation after the Effective Time shall be
cancelled and exchanged for cash as provided in this Article II. At the close
of business on the day of the Effective Time the stock ledger of the Company
with respect to Common Stock shall be closed.
2.07 Stock Option and Other Plans. (a) Prior to
the Effective Time, the Board of Directors of the Company (or, if appropriate,
any Committee thereof) shall adopt appropriate resolutions and take all other
actions necessary to provide for the cancellation, effective at the Effective
Time, of all the outstanding stock options, stock appreciation rights, limited
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stock appreciation rights and performance units (the "Options") heretofore
granted under any stock option, performance unit or similar plan of the Company
(the "Stock Plans"). Immediately prior to the Effective Time, (i) each Option,
whether or not then vested or exercisable, shall no longer be exercisable but
shall entitle each holder thereof, in cancellation and settlement therefor, to
payments in cash (subject to any applicable withholding taxes, the "Cash
Payment"), at the Effective Time, equal to the product of (x) the total number
of shares of Common Stock subject or related to such Option, whether or not
then vested or exercisable, and (y) the excess of the Merger Consideration over
the exercise price per share of Common Stock subject or related to such Option,
each such Cash Payment to be paid to each holder of an outstanding Option at
the Effective Time; provided, however, that with respect to any Person subject
to Section 16 of the Exchange Act, any such amount shall be paid as soon as
practicable after the first date payment can be made without liability to such
Person under Section 16(b) of the Exchange Act, and (ii) each share of Common
Stock previously issued in the form of grants of restricted stock or grants of
contingent shares shall fully vest. As provided herein, the Stock Plans and
any other plan, program or arrangement (excluding the Melroe Savings and
Investment Plan and the Clark Equipment Company Savings and Investment Plan
(collectively, the "Savings Plans"), and the Clark Equipment Company Leveraged
Employee Stock Ownership Plan ("the LESOP")) providing for the issuance or
grant of any other interest in respect of the capital stock of the Company or
any subsidiary (collectively with the Stock Plans, referred to as the "Stock
Incentive Plans") shall terminate as of the Effective Time; provided, however,
that on and after the Effective Time, the Savings Plans and the LESOP shall not
be required to provide for any investment in the capital stock of the Surviving
Corporation or any subsidiary of the Surviving Corporation. The Company will
take all reasonable steps to ensure that none of the Parent, the Company or any
of their respective subsidiaries is or will be bound by any Options, other
options, warrants, rights or agreements which would entitle any Person, other
than Parent or its affiliates, to own any capital stock of the Surviving
Corporation or any of its subsidiaries or to receive any payment in respect
thereof. The Company will use its reasonable best efforts to obtain all
necessary consents to ensure that after the Effective Time, the only rights of
the holders of Options to purchase shares of Common Stock in respect of such
Options will be to receive the Cash Payment in cancellation and settlement
thereof.
(b) All Stock Plans shall terminate as of the
Effective Time and the Company shall ensure that following the Effective Time
no holder of an Option or any participant in any Stock Plans shall have any
right thereunder to acquire any capital stock of the Company, Parent or the
Surviving Corporation, except as provided in the proviso to clause (i) of
Section 2.07(a).
2.08 Certificate of Incorporation of the Surviving
Corporation. The Certificate of Incorporation of the Company, as in effect
immediately prior to the Effective Time, shall be the Certificate of
Incorporation of the Surviving Corporation until amended in accordance with
applicable law.
2.09 By-Laws of the Surviving Corporation. The By-
Laws of the Company, as in effect immediately prior to the Effective Time,
shall be the By-Laws of the Surviving Corporation until amended in accordance
with applicable law.
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2.10 Directors and Officers of the Surviving Corpor-
ation. At the Effective Time, the directors of Purchaser immediately prior to
the Effective Time shall be the initial directors of the Surviving Corporation,
each of such directors to hold office in accordance with the applicable
provisions of the Certificate of Incorporation and By-Laws of the Surviving
Corporation. At the Effective Time, the officers of the Company immediately
prior to the Effective Time shall, subject to the applicable provisions of the
Certificate of Incorporation and By-Laws of the Surviving Corporation, be the
officers of the Surviving Corporation until their respective successors shall
be duly elected or appointed and qualified.
2.11 Closing. The closing of the Merger (the "Clos-
ing") shall take place as soon as practicable after the last of the conditions
set forth in Article V hereof is fulfilled or waived (subject to applicable
law) at such place as Parent and the Company shall mutually agree (the "Closing
Date").
ARTICLE III
REPRESENTATIONS AND WARRANTIES
3.01 Representations and Warranties of the Company.
The Company hereby represents and warrants to Parent and Purchaser as follows
(provided, that from and after the consummation of the transactions
contemplated by the Stock Purchase Agreement, dated March 5, 1995, by and among
the Company, AB Volvo and Clark-Hurth Components Marketing Company (the "VME
Sale Agreement") the Company shall be deemed not to make any representation or
warranty for the purpose of this Agreement with respect to its interest in VME
Group, N.V.):
(a) Due Organization, Good Standing and Corporate Power.
Each of the Company and its subsidiaries is a corporation duly
organized, validly existing and in good standing under the laws of the
jurisdiction of its incorporation and each such corporation has all
requisite corporate power and authority to own, lease and operate its
properties and to carry on its business as now being conducted except
where the failure to be so organized, existing and in good standing or
to have such power and authority would not, individually or in the
aggregate, reasonably be expected to have a material adverse effect on
the business, assets, financial condition or results of operations
("Condition") of the Company and its subsidiaries taken as a whole;
each of the Company and its subsidiaries is duly qualified or licensed
as a foreign corporation to do business and is in good standing in each
jurisdiction in which the property owned, leased or operated by it or
the nature of the business conducted by it makes such qualification or
license necessary, except where the failure to be so qualified or
licensed and in good standing would not reasonably be expected to have
a material adverse effect on the Condition of the Company and its sub-
sidiaries taken as a whole. The Company has made available to Parent
and Purchaser complete and correct copies of the Restated Certificate
of Incorporation and By-Laws of the Company and its subsidiaries, in
each case as amended to the date of this Agreement.
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(b) Authorization and Validity of Agreement. The
Company has full corporate power and authority to execute and deliver
this Agreement, to perform its obligations hereunder and to consummate
the transactions contemplated hereby. The execution, delivery and
performance of this Agreement by the Company, and the consummation by
it of the transactions contemplated hereby, have been duly authorized
and approved by its Board of Directors and no other corporate action on
the part of the Company is necessary to authorize the execution,
delivery and performance of this Agreement by the Company and the con-
summation of the transactions contemplated hereby (other than, with
respect to the Merger, the approval of this Agreement by the holders of
a majority of the shares of Common Stock). This Agreement has been
duly executed and delivered by the Company and is a valid and binding
obligation of the Company.
(c) Capitalization. (i) The authorized capital stock
of the Company consists of 40,000,000 shares of Common Stock and
3,000,000 shares of preferred stock, $1.00 par value (the "Preferred
Stock"). As of April 7, 1995, (1) 17,101,396 shares of Common Stock
were issued and outstanding, (2) 97,438 shares of Common Stock were
reserved for issuance pursuant to outstanding Options granted under the
Stock Incentive Plans, (3) no shares of Preferred Stock were issued and
outstanding and (4) 2,093,288 shares of Common Stock were held in the
Company's treasury. All issued and outstanding shares of Common Stock
have been validly issued and are fully paid and nonassessable, and are
not subject to, nor were they issued in violation of, any preemptive
rights. Except as set forth in this Section 3.01(c)(i) or on Schedule
3.01(c)(i) of the Disclosure Schedule delivered by the Company to
Parent on or prior to the date hereof (the "Disclosure Schedule"), (i)
there are no shares of capital stock of the Company authorized, issued
or outstanding and (ii) there are not as of the date hereof, and at the
Effective Time there will not be, any outstanding or authorized
options, warrants, rights, subscriptions, claims of any character,
agreements, obligations, convertible or exchangeable securities, or
other commitments, contingent or otherwise, relating to Common Stock or
any other shares of capital stock of the Company, pursuant to which the
Company is or may become obligated to issue shares of Common Stock, any
other shares of its capital stock or any securities convertible into,
exchangeable for, or evidencing the right to subscribe for, any shares
of the capital stock of the Company, and there are no outstanding
obligations of the Company or any of its subsidiaries to repurchase,
redeem or otherwise acquire any securities described in this sentence.
Since April 7, 1995, no options to purchase shares of Company Common
Stock have been granted and no shares of Company Common Stock have been
issued. Schedule 3.01(c)(i) sets forth the number of Options and
shares of restricted stock outstanding and, in the case of the Options,
the exercise price therefor. The Company has no authorized or out-
standing bonds, debentures, notes or other indebtedness the holders of
which have the right to vote (or convertible or exchangeable into or
exercisable for securities having the right to vote) with the stock-
holders of the Company or any of its subsidiaries on any matter.
(ii) Set forth in Schedule 3.01(c)(ii) of the Disclosure Schedule
is a list of all of the Company's significant subsidiaries (as such
term is defined in the Securities Exchange Act of 1934, as amended).
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Except for VME Group N.V. and its subsidiaries, the Company is,
directly or indirectly, the record and/or beneficial owner of all of
the shares of capital stock of each of the subsidiaries. Except as set
forth on Schedule 3.01(c)(ii), no securities of any of the subsidiaries
are or may become required to be issued, transferred or sold for any
reason and all of the outstanding securities of each subsidiary are
validly issued, fully paid and nonassessable and are owned free and
clear of any claim, lien, encumbrance or agreement with respect
thereto. No entity in which the Company owns, directly or indirectly,
less than a 50% equity interest is, individually or when taken together
with all such other entities, material to the business of the Company
and its subsidiaries taken as a whole.
(d) Consents and Approvals; No Violations. Assum-
ing (i) the filings required under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended (the "HSR Act"), and Regulation
(EEC) No. 4064/89 of the European Community, are made and the waiting
periods thereunder have been terminated or have expired, (ii) the
requirements of the Exchange Act and any applicable state securities,
"blue sky" or takeover law are met, (iii) the filing of the Certificate
of Merger and other appropriate merger documents, if any, as required
by Delaware General Corporation Law, is made and (iv) approval of the
Merger by a majority of the holders of Common Stock, if required by
Delaware General Corporation Law, is received and except as disclosed
in Schedule 3.01(d) of the Disclosure Schedule, the execution and
delivery of this Agreement by the Company and the consummation by the
Company of the transactions contemplated hereby will not: (1) violate
any provision of the Certificate of Incorporation, as amended, or By-
Laws of the Company or any of its subsidiaries; (2) violate any
statute, ordinance, rule, regulation, order or decree of any court or
of any governmental or regulatory body, agency or authority applicable
to the Company or any of its subsidiaries or by which any of their
respective properties or assets may be bound; (3) require any filing
with, or permit, consent or approval of, or the giving of any notice
to, any governmental or regulatory body, agency or authority; or (4)
result in a violation or breach of, conflict with, constitute (with or
without due notice or lapse of time or both) a default (or give rise to
any right of termination, cancellation, payment or acceleration) under,
or result in the creation of any lien, security interest, charge or
encumbrance upon any of the properties or assets of the Company or any
of its subsidiaries under, any of the terms, conditions or provisions
of any note, bond, mortgage, indenture, license, franchise, permit,
agreement, lease, franchise agreement or other instrument or obligation
to which the Company or any of its subsidiaries is a party, or by which
it or any of their respective properties or assets are bound, except
for such filings, permits, consents, approvals or violations which
would not reasonably be expected to have a material adverse effect on
the Condition of the Company and its subsidiaries, taken as a whole, or
would not individually or in the aggregate reasonably be expected to
prevent or materially delay consummation of the transactions
contemplated by this Agreement.
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(e) Company Reports and Financial Statements. (i)
Since January 1, 1993, the Company has filed all forms, reports and
documents with the Commission required to be filed by it pursuant to
the federal securities laws and the Commission rules and regulations
thereunder, and except as described in Schedule 3.01(e) of the
Disclosure Schedule, all forms, reports and documents filed with the
Commission have complied in all material respects with all applicable
requirements of the federal securities laws and the Commission rules
and regulations promulgated thereunder. The Company has, prior to the
date of this Agreement, made available to Parent true and complete
copies of all forms, reports, registration statements and other filings
filed by the Company with the Commission since January 1, 1993 (such
forms, reports, registration statements and other filings, together
with any exhibits, any amendments thereto and information incorporated
by reference therein, are sometimes collectively referred to as the
"Commission Filings"). Except as described in Schedule 3.01(e) of the
Disclosure Schedule, as of their respective dates, the Commission
Filings (including but not limited to any financial statements or
schedules included or incorporated by reference therein) did not
contain any untrue statement of a material fact or omit to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were
made, not misleading. Except as described in Schedule 3.01(e) of the
Disclosure Schedule, and except to the extent revised or superseded by
a subsequent filing with the Commission, none of the Commission Filings
filed by the Company since December 31, 1994 (excluding any filings in
connection with the transactions contemplated by this Agreement) and
prior to the date hereof contains any untrue statement of a material
fact or omits to state a material fact required to be stated or
incorporated by reference therein or necessary in order to make the
statements therein, in the light of the circumstances under which they
were made, not misleading. Each of the consolidated balance sheets as
of the end of the fiscal years ended December 31, 1994, 1993 and 1992
and the consolidated statements of operations, consolidated statements
of stockholders' equity and consolidated statements of changes in
financial position for the fiscal years ended December 31, 1994, 1993
and 1992 and included in the Commission Filings and the consolidated
pro forma financial statements of the Company included in its Current
Report on Form 8-K filed with the Commission as of March 13, 1995 (the
"March 13 8-K") were prepared in accordance with generally accepted
accounting principles (as in effect from time to time) applied on a
consistent basis (except as may be indicated therein or in the notes or
schedules thereto) and fairly present the consolidated financial
position of the Company and its consolidated subsidiaries as of the
dates thereof and the results of their operations and changes in
financial position for the periods then ended and on a pro forma basis
for 1994 in the case of the March 13 8-K.
(f) Absence of Other Liabilities. Except as and to
the extent set forth on the consolidated balance sheet of the Company
and its subsidiaries at December 31, 1994, including the notes thereto,
and the pro forma consolidated balance sheet of the Company and its
subsidiaries at March 31, 1995, including the notes thereto, neither
the Company nor any of its subsidiaries has any liabilities or
obligations of any nature (whether accrued, absolute, contingent or
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otherwise) which would be required to be reflected on a balance sheet
or in the notes thereto prepared in accordance with generally accepted
accounting principles, except for liabilities or obligations incurred
in the ordinary course of business since December 31, 1994 and as a
result of the acquisition of Club Car, Inc., which would not,
individually or in the aggregate, reasonably be expected to have a
material adverse effect on the Condition of the Company and its
subsidiaries taken as a whole.
(g) Anticipated Filings. The Company has hereto-
fore furnished to Parent a complete and correct copy of any amendments
or modifications which have not yet been filed with the Commission to
agreements (including the Rights Agreement), documents or other
instruments which previously had been filed by the Company with the
Commission pursuant to the Securities Act and the rules and regulations
promulgated thereunder or the Exchange Act and the rules and
regulations promulgated thereunder.
(h) Absence of Certain Changes. Except as previ-
ously disclosed in the Commission Filings or as otherwise disclosed in
Schedule 3.01(h) of the Disclosure Schedule or as otherwise
contemplated by this Agreement, since December 31, 1994 (i) there has
not been any material adverse change in the Condition of the Company
and its subsidiaries taken as a whole (without regard, however, to
changes in conditions generally applicable to the industries in which
the Company and its subsidiaries are involved or general economic
conditions); (ii) the businesses of the Company and each of its
subsidiaries have been conducted only in the ordinary course and in a
manner consistent with past practice; (iii) neither the Company nor any
of its subsidiaries has incurred any material liabilities (direct, con-
tingent or otherwise) or engaged in any material transaction or entered
into any material agreement outside the ordinary course of business;
(iv) neither the Company nor any of its subsidiaries has taken any
action referred to in Section 4.03 hereof except as permitted thereby;
(v) there has not been any damage, destruction or loss (whether or not
covered by insurance) with respect to any assets of the Company or any
of its subsidiaries which would reasonably be expected to, individually
or in the aggregate, have a material adverse effect on the Condition of
the Company and its subsidiaries taken as a whole, (vi) there has not
been any revaluation by the Company of any of its material assets,
including but not limited to writing down the value of inventory or
writing off notes or accounts receivable other than in the ordinary
course of business, (vii) there has not been any entry by the Company
or any of its subsidiaries into any commitment or transactions material
to the Company and its subsidiaries taken as a whole, except for the
acquisition of Club Car, Inc. and the sale of the Company's 50%
interest in VME Group N.V., (viii) there has not been any declaration,
setting aside or payment of any dividends or distributions in respect
of the Shares or any redemption, purchase or other acquisition of any
of its securities, except for the repurchase of 305,000 Shares under a
share repurchase plan announced by the Company on February 3, 1995,
(ix) there has not been any issuance of any shares of capital stock of
the Company of any of its subsidiaries or any grant or issuance of any
options, calls, warrants, or other rights, agreements, arrangements or
commitments of any kind or character relating to the issuance of
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capital stock of the Company or any of its subsidiaries; (x) there has
not been any increase in or establishment of any bonus, insurance,
severance, deferred compensation, pension, retirement, profit sharing,
stock option (including, without limitation, the granting of stock
options, stock appreciation rights, performance awards, or restricted
stock awards), stock purchase or other employee benefit plan or
agreement or arrangement, or any other increase in the compensation
payable or to become payable to any present or former directors,
officers or key employees of the Company or any of its subsidiaries,
except for increases in base compensation in the ordinary course of
business consistent with past practice, or any employment, consulting
or severance agreement or arrangement entered into with any such
present or former directors, officers or key employees; and (xi) there
has been no change by the Company in accounting principles, practices
or methods.
(i) Compliance with Laws. Except as disclosed in
the Commission Filings, the Company and its subsidiaries are in
compliance with all applicable laws, regulations, orders, judgments and
decrees except where the failure to so comply would not reasonably be
expected to have a material adverse effect on the Condition of the
Company and its subsidiaries taken as a whole.
(j) Litigation. Except as disclosed in the Commis-
sion Filings, there is no action, suit, proceeding at law or in equity,
or any arbitration or any administrative or other proceeding by or
before (or to the best knowledge of the Company any investigation by)
any governmental or other instrumentality or agency, pending, or, to
the best knowledge of the Company, threatened, against or affecting the
Company or any of its subsidiaries, or any of their properties or
rights which would reasonably be expected to have a material adverse
effect on the Condition of the Company and its subsidiaries taken as a
whole. Except as disclosed in the Commission Filings, neither the Com-
pany nor any of its subsidiaries is subject to any judgment, order,
award or decree entered in any lawsuit or proceeding which has a
material adverse effect on the Condition of the Company and its
subsidiaries taken as a whole.
(k) Employee Benefit Plans. All "employee benefit
plans" ("Employee Plans") as defined in Section 3(3) of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA"),
maintained or contributed to by the Company and its subsidiaries are in
compliance with the applicable provisions of ERISA and the Internal
Revenue Code of 1986, as amended (the "Code"), except for instances of
non-compliance that individually or in the aggregate would not
reasonably be expected to have a material adverse effect on the
Condition of the Company and its subsidiaries taken as a whole.
(l) Taxes. The Company and each of its subsidi-
aries, and any consolidated, combined, unitary or aggregate group for
tax purposes of which the Company or any of its subsidiaries is or has
been a member, has filed or caused to be filed, or will file or cause
to be filed on or prior to the Closing Date (as defined in Section
2.11), all Tax returns and Tax reports which are required to be filed
by, or with respect to, it on or prior to the Closing Date (taking into
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account any extension of time to file granted to or on behalf of the
Company or any subsidiary) (collectively, the "Returns"). Such Returns
reflect accurately all material liability for Taxes for the periods
covered thereby. All material Taxes payable by, or due from, the
Company or any of its subsidiaries have been fully paid or adequately
disclosed and provided for on the financial statements of the Company
and its subsidiaries in accordance with generally accepted accounting
principles. Except as set forth in Schedule 3.01(l) of the Disclosure
Schedule, all Taxes (as defined below) shown to be due and payable on
the Returns by or with respect to the Company or any of its subsidi-
aries have been, or prior to the Closing Date will be, paid. Except as
disclosed on Schedule 3.01(l), (i) no material claim for unpaid Taxes
(x) to the best knowledge of the Company, has become a lien or
encumbrance of any kind against the property of the Company or any of
its subsidiaries or (y) is being asserted against the Company or any of
its subsidiaries; (ii) no audit of any Return of the Company or any of
its subsidiaries is being conducted by a Tax authority; and (iii) no
extension of the statute of limitations on the assessment of any Taxes
has been granted by the Company or any of its subsidiaries and is cur-
rently in effect. As used herein, "Taxes" shall mean any taxes of any
kind, including but not limited to those on or measured by or referred
to as income, gross receipts, capital, sales, use, ad valorem,
franchise, profits, license, withholding, payroll, employment, excise,
severance, stamp, occupation, premium, value added, property or
windfall profits taxes, customs, duties or similar fees, assessments or
charges of any kind whatsoever, together with any interest and any
penalties, additions to tax or additional amounts imposed by any
governmental authority, domestic or foreign.
(m) Proxy Statement, Schedule 14D-9 and Schedule
14D-1. The definitive proxy statement and related materials, if
required, to be furnished to the holders of Common Stock in connection
with the Merger pursuant to Section 4.04 hereof (together with any
amendments or supplements thereto, the "Proxy Statement") will comply
as to form in all material respects with the Exchange Act and the rules
and regulations thereunder. Notwithstanding the foregoing, no
representation or warranty is made with respect to any information with
respect to Parent or Purchaser or its officers, directors or affiliates
provided to the Company by Parent or Purchaser in writing for inclusion
in the Proxy Statement. The Proxy Statement will not, at the date such
information is supplied, at the time of the stockholders' meeting
referred to in Section 4.05 hereof and at the Effective Time, contain
any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make the
statements therein, in light of the circumstance under which they are
made, not misleading or necessary to correct any statement in any
earlier communication with respect to the solicitation of proxies for
such stockholders' meeting which has become false or misleading. None
of the information in the Schedule 14D-9 or supplied by the Company in
writing for inclusion in the Offer Documents or any amendment or
supplement to any thereof, at the respective times the Schedule 14D-9
or such amendment or supplement is filed with the Commission, will
contain any untrue statement of a material fact or omit to state a
material fact necessary in order to make the statements made, in light
of the circumstances under which they are made, not misleading. Not-
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withstanding the foregoing, no representation or warranty is made with
respect to any information with respect to Parent or Purchaser or its
officers, directors or affiliates provided to the Company by Parent or
Purchaser in writing for inclusion in the Schedule 14D-9. The Schedule
14D-9 will comply as to form in all material respects with the Exchange
Act and the rules and regulations thereunder.
(n) Broker's or Finder's Fee. Except for First
Boston (whose fees and expenses will be paid by the Company in
accordance with the Company's agreement with such firm, a true and
correct copy of which has been previously delivered to Parent by the
Company), no agent, broker, Person or firm acting on behalf of the
Company is, or will be, entitled to any fee, commission or broker's or
finder's fees from any of the parties hereto, or from any Person
controlling, controlled by, or under common control with any of the
parties hereto, in connection with this Agreement or any of the trans-
actions contemplated hereby.
(o) Environmental Laws and Regulations. Except as
disclosed in the Commission Filings or in Schedule 3.01(o) of the
Disclosure Schedule, the Company and its subsidiaries are in material
compliance with all applicable federal and state laws and regulations,
as in effect on the date hereof, relating to the protection of the
environment (collectively, "Environmental Laws"), except for viola-
tions, of Environmental Laws that, individually or in the aggregate,
would not reasonably be expected to have a material adverse effect on
the Condition of the Company and its subsidiaries, taken as a whole.
(p) State Takeover Statutes and Supermajority
Voting Provisions. The Board of Directors of the Company has approved
the Offer, the Merger and this Agreement and such approval is suffici-
ent to render inapplicable to the Offer, the Merger, this Agreement and
the other transactions contemplated by this Agreement, the provisions
of Section 203 of the Delaware General Corporation Law and of the
supermajority stockholder voting requirements of paragraph (6) of
Article SIXTH of the Company's Certificate of Incorporation.
(q) Rights Agreement. The Company and the Board of
Directors of the Company have taken all necessary action so that none
of the execution of this Agreement, the making of the Offer, the
acquisition of shares of Common Stock pursuant to the Offer or the
consummation of the Merger will (i) cause any Rights issued pursuant to
the Rights Agreement to become exercisable, (ii) cause Parent,
Purchaser or any of their Affiliates (as defined in the Rights
Agreement) or Associates (as defined in the Rights Agreement) to be an
Acquiring Person (as defined in the Rights Agreement) or (iii) give
rise to a Distribution Date or a Triggering Event (as each such term is
defined in the Rights Agreement). The Company has delivered to Parent
a complete and correct copy of the Rights Agreement as amended and
supplemented to the date of this Agreement.
3.02 Representations and Warranties of Parent and
Purchaser. Each of Parent and Purchaser represents and warrants to the Company
as follows:
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(a) Due Organization; Good Standing and Corporate
Power. Parent is a corporation duly organized, validly existing and in
good standing under the laws of the State of New Jersey and has all
requisite corporate power and authority to own, lease and operate its
properties and to carry on its business as now being conducted except
where the failure to be so organized, existing and in good standing or
to have such power or authority, would not, individually or in the
aggregate, reasonably be expected to prevent or materially delay
consummation of the transactions contemplated by this Agreement.
Purchaser is a corporation duly organized, validly existing and in good
standing under the laws of the State of Delaware and has all requisite
corporate power and authority to own, lease and operate its properties
and to carry on its business as now being conducted except where the
failure to be so organized, existing and in good standing or to have
such power or authority would not, individually or in the aggregate,
reasonably be expected to prevent or materially delay consummation of
the transactions contemplated by this Agreement.
(b) Authorization and Validity of Agreement. Each
of Parent and Purchaser has full corporate power and authority to
execute and deliver this Agreement, to perform its obligations
hereunder and to consummate the transactions contemplated hereby. The
execution, delivery and performance of this Agreement by Parent and
Purchaser, and the consummation by each of them of the transactions
contemplated hereby, have been duly authorized and approved by the
respective Boards of Directors of Parent and Purchaser. No other cor-
porate action on the part of either of Parent or Purchaser is necessary
to authorize the execution, delivery and performance of this Agreement
by each of Parent and Purchaser and the consummation of the
transactions contemplated hereby (other than, with respect to the
Merger, the approval of this Agreement by the sole stockholder of
Purchaser, if required by Delaware General Corporation Law). This
Agreement has been duly executed and delivered by each of Parent and
Purchaser and is a valid and binding obligation of each of Parent and
Purchaser.
(c) Consents and Approvals; No Violations. Assum-
ing (i) the filings required under the HSR Act and Regulation (EEC) No.
4064/89 of the European Community, are made and the waiting periods
thereunder have been terminated or have expired, (ii) the requirements
of the Exchange Act and any applicable state securities, "blue sky" or
takeover law are met, (iii) the filing of the Certificate of Merger and
other appropriate merger documents, if any, as required by Delaware
General Corporation Law is made and (iv) approval of this Agreement by
the sole stockholder of Purchaser if required by Delaware General
Corporation Law, the execution and delivery of this Agreement by Parent
and Purchaser and the consummation by Parent and Purchaser of the
transactions contemplated hereby will not: (1) violate any provision
of the Certificate of Incorporation or By-Laws of Parent or Purchaser;
(2) violate any statute, ordinance, rule, regulation, order or decree
of any court or of any governmental or regulatory body, agency or
authority applicable to Parent or Purchaser or by which either of their
respective properties or assets may be bound; (3) require any filing
with, or permit, consent or approval of, or the giving of any notice
to, any governmental or regulatory body, agency or authority; or (4)
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result in a violation or breach of, conflict with, constitute (with or
without due notice or lapse of time or both) a default (or give rise to
any right of termination, cancellation, or acceleration) under, or
result in the creation of any lien, security interest, charge or encum-
brance upon any of the properties or assets of the Parent, Purchaser or
any of their subsidiaries under, any of the terms, conditions or pro-
visions of any note, bond, mortgage, indenture, license, franchise,
permit, agreement, lease, or other instrument or obligation to which
Parent or Purchaser or any of their subsidiaries is a party, or by
which they or their respective properties or assets are bound except
for such filings, permits, consents, approvals or violations, which
would not, individually or in the aggregate, reasonably be expected to
prevent or materially delay consummation of the transactions con-
templated by this Agreement.
(d) Offer Documents, Schedule 14D-9 and Proxy
Statement. The Offer Documents will comply as to form in all material
respects with the Exchange Act and the rules and regulations
thereunder. The Offer Documents, will not, at the time such Offer
Documents are filed with the Commission or are first published, sent or
given to the Company's stockholders, as the case may be, contain any
untrue statement of a material fact or omit to state any material fact
required to be stated therein or necessary in order to make the
statements therein, in light of the circumstances under which they were
made, not misleading or necessary to correct any statement in any
earlier Offer Documents which has become false or misleading. If at
any time prior to the expiration or termination of the Offer any event
occurs which should be described in an amendment or supplement to the
Schedule 14D-1 or any amendment or supplement thereto, Purchaser will
file and disseminate, as required, an amendment or supplement which
complies in all material respects with the Exchange Act and the rules
and regulations thereunder and any other applicable laws. None of the
information in the Offer Documents or supplied or to be supplied by
Parent and/or Purchaser in writing for inclusion in the Proxy Statement
and/or the Schedule 14D-9 of the Company or any amendment or supplement
to any thereof, at the respective times the Offer Documents or the
Schedule 14D-9, such amendment or supplement, is filed with the
Commission or, with respect to the Proxy Statement, at the time such
Proxy Statement is first mailed to stockholders, at the time of the
Company's stockholders' meeting or at the Effective Time, will contain
any untrue statement of a material fact or omit to state a material
fact necessary in order to make the statements made, in light of the
circumstances under which they are made, not misleading.
Notwithstanding the foregoing, no representation or warranty is made
with respect to any information with respect to the Company or its
officers, directors and affiliates provided to Parent or Purchaser by
the Company in writing for inclusion in the Offer Documents.
(e) Broker's or Finder's Fee. Except for Merrill
Lynch, Pierce, Fenner & Smith Incorporated (whose fees and expenses as
financial advisor to Parent and Purchaser will be paid by Parent or
Purchaser in accordance with the Parent's agreement with such firm), no
agent, broker, Person or firm acting on behalf of Parent or Purchaser
is, or will be, entitled to any fee, commission or broker's or finder's
fees from any of the parties hereto, or from any Person controlling,
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controlled by, or under common control with any of the parties hereto,
in connection with this Agreement or any of the transactions
contemplated hereby.
(f) Financing. Parent has a commitment to provide
the financing for, and shall provide Purchaser with, the funds
necessary to consummate the Offer and the Merger and the transactions
contemplated thereby in accordance with the terms hereof and thereof.
ARTICLE IV
TRANSACTIONS PRIOR TO CLOSING DATE
4.01 Access to Information Concerning Properties and
Records. During the period commencing on the date hereof and ending on the
Closing Date, the Company shall, and shall cause each of its subsidiaries and
other agents to, upon reasonable notice, afford Parent and Purchaser, and their
respective counsel, accountants, consultants and other authorized
representatives who agree to be bound by the Parent Confidentiality Agreement
(defined below), reasonable access during normal business hours (to the extent
feasible without undue interference with or disruption to the operation of the
Company, or any of its business units) to the employees, properties, offices,
plants and other facilities and to all books and records of the Company and its
subsidiaries in order that they may have the opportunity to make such inves-
tigations as they shall desire of the affairs of the Company and its sub-
sidiaries. The Company shall furnish promptly to Parent and Purchaser (a) a
copy of each report, schedule, registration statement and other document filed
by it or its subsidiaries during such period pursuant to the requirements of
Federal or state securities laws and (b) all other information concerning its
or its subsidiaries' business, properties and personnel as Parent and Purchaser
may reasonably request. The Company agrees to cause its officers and employees
to furnish such additional financial and operating data and other information
and respond to such inquiries as Parent and Purchaser shall from time to time
reasonably request.
4.02 Confidentiality. Information obtained by
Parent and Purchaser pursuant to Section 4.01 hereof shall be subject to the
provisions of the Confidentiality Agreement between the Company and Parent
dated April 9, 1995 (the "Parent Confidentiality Agreement").
4.03 Conduct of the Business of the Company Pending
the Closing Date. The Company agrees that, except as permitted, required or
specifically contemplated by, or otherwise described in, this Agreement or
otherwise consented to or approved in writing by Parent, during the period com-
mencing on the date hereof and ending on the Closing Date:
(a) The Company and each of its subsidiaries will
conduct their respective operations only according to their ordinary
and usual course of business consistent with past practice and, except
for actions taken in the ordinary course of business, will use their
reasonable best efforts to preserve intact their respective business
organization, keep available the services of their officers and
employees and maintain satisfactory relationships with licensors,
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suppliers, distributors, clients and others having business
relationships with them;
(b) Neither the Company nor any of its subsidiaries
(other than VME Group, N.V.) shall (i) make any change in or amendment
to its Certificate of Incorporation or By-Laws (or comparable governing
documents); (ii) issue or sell any shares of its capital stock (other
than in connection with the exercise of Options outstanding on the date
hereof) or any of its other securities (including but not limited to
stock appreciation rights or phantom stock), or issue any securities
convertible into, or options, warrants or rights to purchase or
subscribe to, or enter into any arrangement or contract with respect to
the issuance or sale of, any shares of its capital stock or any of its
other securities, or make any other changes in its capital structure;
(iii) sell or pledge or agree to sell or pledge any stock owned by it
in any of its subsidiaries; (iv) declare, pay, set aside or make any
dividend or other distribution or payment with respect to, or split,
combine, redeem or reclassify, purchase or otherwise acquire, directly
or indirectly, any shares of its capital stock; (v) other than in the
ordinary course of business consistent with past practice, transfer,
lease, license, guarantee, sell, mortgage, pledge, dispose of, encumber
or subject to any lien, any material assets or incur or modify any
indebtedness other than any indebtedness incurred in connection with
the acquisition of Club Car, Inc. or other liability or issue any debt
securities or assume, guarantee or endorse or otherwise as an
accommodation become responsible for the obligations of any person;
(vi) make any tax election or settle or compromise any material tax
liability; (vii) except as may be required as a result of a change in
law or in generally accepted accounting principles, make any material
change in its method of accounting; (viii) (A) acquire (by merger,
consolidation or acquisition of stock or assets) any corporation,
partnership or other business organization or division thereof; (B)
enter into any contract or agreement other than in the ordinary course
of business consistent with past practice that would be material to the
Company and its subsidiaries taken as a whole; (C) to the extent not
included in the Company's capital budget for 1995 previously approved
by the Company's Board of Directors, for 150 days after the date of
this Agreement, authorize any single capital expenditure in excess of
$1.5 million or capital expenditures of $10 million in the aggregate;
or (D) enter into or materially amend any contract, agreement,
commitment or arrangement with respect to any of the matters set forth
in this Section 4.03(b)(viii); (ix) except to the extent required under
existing employee and director benefit plans, agreements or arrange-
ments as in effect on the date of this Agreement, increase the
compensation or fringe benefits of any of its directors, officers or
employees, except for increases in salary or wages of employees of the
Company or its subsidiaries who are not officers of the Company in the
ordinary course of business in accordance with past practice, or grant
any severance or termination pay not currently required to be paid
under existing severance plans or enter into any employment, consulting
or severance agreement or arrangement with any present or former
director, officer or other employee of the Company or any of its
subsidiaries (other than employment contracts with the individuals
listed on Schedule 4.03(b)(ix) of the Disclosure Schedule), or
establish, adopt, enter into or amend or terminate any collective
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bargaining, bonus, profit sharing, thrift, compensation, stock option,
restricted stock, pension, retirement, deferred compensation,
employment, termination, severance or other plan, agreement, trust,
fund, policy or arrangement for the benefit of any directors, officers
or employees; (x) adopt a plan of complete or partial liquidation,
dissolution, merger, consolidation, restructuring, recapitalization or
other reorganization of the Company or any of its subsidiaries not
constituting an inactive subsidiary (other than the Merger); (xi) pay,
discharge or satisfy any claims, liabilities or obligations (absolute,
accrued, asserted or unasserted, contingent or otherwise), other than
the payment, discharge or satisfaction in the ordinary course of busi-
ness and consistent with past practice of liabilities reflected or
reserved against in the financial statements of the Company or incurred
in the ordinary course of business and consistent with past practice;
or (xii) agree, in writing or otherwise, to take any of the foregoing
actions. Notwithstanding anything contained in this Agreement to the
contrary, the Company shall be permitted in anticipation of, or
otherwise with respect to, a change in control of the Company, as de-
fined in the agreement between Leo J. McKernan and the Company, dated
November 12, 1992 (a "Change in Control"), to fully fund, through the
Clark Equipment Company Supplemental Executive Retirement Trust and/or
the Clark Equipment Company Deferred Benefit Trust, (collectively, "the
Rabbi Trusts"), all amounts payable, or which may become payable, to
employees of the Company and its subsidiaries upon a Change in Control
(including additional amounts (up to a maximum of $23 million) required
to be paid to such employees to gross up such payments for any income
or other taxes incurred with respect thereto); provided, however, in no
event shall such additional amounts be contributed to either of such
Rabbi Trusts until the Company has obtained the consents referred to in
Section 4.10(f) hereof from all participants (other than retired
participants) of the Clark Equipment Company Supplemental Retirement
Income Plan for Certain Executives; and
(c) The Company shall not, and shall not permit any
of its subsidiaries other than VME Group, N.V. to, (i) take any action,
engage in any transaction or enter into any agreement which would cause
any of the representations or warranties set forth in Section 3.01
hereof to be untrue as of the Closing Date, or (ii) purchase or
acquire, or offer to purchase or acquire, any shares of capital stock
of the Company.
4.04 Proxy Statement. If stockholder approval of
the Merger is required by law, as promptly as practicable after the
consummation of the Offer, the Company will prepare and file a preliminary
Proxy Statement with the Commission and will use its reasonable best efforts to
have it cleared by the Commission. Parent, Purchaser and the Company will
cooperate with each other in the preparation of the Proxy Statement; without
limiting the generality of the foregoing, each of Parent and Purchaser will
furnish to the Company the information relating to it required by the Exchange
Act to be set forth in the Proxy Statement. The Company, Parent and Purchaser
each agree to use its reasonable best efforts, after consultation with the
other parties hereto, to respond promptly to any comments made by the
Commission with respect to the Proxy Statement and any preliminary version
thereof filed by it and cause such Proxy Statement to be mailed to the
Company's stockholders at the earliest practicable time.
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4.05 Stockholder Approval. (a) Promptly after the
consummation of the Offer, if required by Delaware General Corporation Law in
order to consummate the Merger, the Company, acting through its Board of
Directors, shall, in accordance with applicable law and the Company's Restated
Certificate of Incorporation and By-laws duly call, give notice of and convene
a meeting of the holders of Common Stock for the purpose of voting upon this
Agreement and the Merger and the Company agrees that this Agreement and the
Merger shall be submitted at such meeting. The Company shall use its
reasonable best efforts to solicit from its stockholders proxies and, subject
always to the fiduciary obligations of the Company's directors under applicable
law, shall take all other action necessary and advisable, to secure the vote of
stockholders required by applicable law to obtain the approval for this
Agreement and the Merger. Subject always to the fiduciary obligations of the
Company's directors under applicable law, the Company agrees that it will
include in the Proxy Statement the recommendation of its Board of Directors
that holders of Common Stock approve and adopt this Agreement and approve the
Merger. Parent and Purchaser will cause all shares of Common Stock owned by
them and their subsidiaries to be voted in favor of the approval and adoption
of this Agreement and the Merger.
(b) Notwithstanding the foregoing, in the event that
Purchaser shall acquire at least 90% of the outstanding Company Common Stock,
the Company agrees, at the request of Purchaser, subject to Article V, to take
all necessary and appropriate action to cause the Merger to become effective as
soon as reasonably practicable after such acquisition, without a meeting of the
Company's stockholders, in accordance with Section 253 of the Delaware General
Corporation Law.
4.06 Reasonable Best Efforts. Subject to the terms
and conditions provided herein, each of the Company, Parent and Purchaser
shall, and the Company shall cause each of its subsidiaries to, cooperate and
use their respective reasonable best efforts to take, or cause to be taken, all
appropriate action, and to make, or cause to be made, all filings necessary,
proper or advisable under applicable laws and regulations to consummate and
make effective the transactions contemplated by this Agreement, including but
not limited to cooperation in the preparation and filing of the Offer
Documents, the Schedule 14D-9, the Proxy Statement, any required filings under
the HSR Act, Regulation (EEC) No. 4064/89 of the European Community or other
foreign filings and any amendments to any thereof, and including, without
limitation, their respective reasonable best efforts to obtain, prior to the
Closing Date, all licenses, permits, consents, approvals, authorizations,
qualifications and orders of governmental authorities and parties to contracts
with the Company and its subsidiaries as are necessary for consummation of the
transactions contemplated by this Agreement and to fulfill the conditions to
the Offer and the Merger. In case at any time after the Effective Time any
further action is necessary or desirable to carry out the purposes of this
Agreement, the proper officers and directors of each party to this Agreement
shall use their reasonable best efforts to take all such necessary action.
4.07 Guarantee of Performance. Parent hereby
guarantees the performance by Purchaser of its obligations under this Agreement
and the obligations of the Surviving Corporation pursuant to Sections 4.10 and
4.11 hereof.
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4.08 Notification of Certain Matters. The Company
shall give prompt notice to Parent and Purchaser, and Parent and Purchaser
shall give prompt notice to the Company, of (i) the occurrence, or non-
occurrence, of any event the occurrence, or non-occurrence, of which would be
reasonably likely to cause any representation or warranty contained in this
Agreement to be untrue or inaccurate in any material respect and (ii) any
failure of the Company, Parent or Purchaser, as the case may be, to comply with
or satisfy any covenants, condition or agreement to be complied with or satis-
fied by it hereunder or, in the case of Parent and Purchaser, under the financ-
ing arrangements with respect to the Offer and the Merger. Each of the
Company, Parent and Purchaser shall give prompt notice to the other parties of
any notice or other communication from any third party alleging that the
consent of such third party is or may be required in connection with the
transactions contemplated by this Agreement.
4.09 HSR Act. The Company shall, no later than the
close of business on April 13, 1995, file a Notification and Report Form under
the HSR Act with the Federal Trade Commission (the "FTC") and the Antitrust
Division of the Department of Justice (the "Antitrust Division"). The Company
and Parent shall use their reasonable best efforts to respond as promptly as
practicable to all inquiries received from the FTC or the Antitrust Division
for additional information or documentation.
4.10 Employee Benefits. (a) Parent agrees that,
during the period commencing at the Effective Time and ending on December 31,
1996, the employees of the Company and its subsidiaries (other than those
employees covered by a collective bargaining agreement) will continue to be
provided with employee benefit plans which in the aggregate are substantially
comparable to those currently provided by the Company and its subsidiaries to
such employees (other than plans involving or related to the securities of the
Company except the Savings Plans (as in effect on April 3, 1995 and
disregarding the effect of the transactions contemplated herein on such
plans)). Employees covered by collective bargaining agreements shall be
provided with such benefits as shall be required under the terms of any
applicable collective bargaining agreement.
(b) Parent hereby unconditionally agrees to cause
the Surviving Corporation to honor and continue to perform, without modifica-
tion, all benefit obligations (including, without limitation, benefits payable
(i) pursuant to the Clark Equipment Company Supplemental Executive Retirement
Plan and the Clark Equipment Company Supplemental Retirement Income Plan for
Certain Executives, (ii) pursuant to the Company's Directors Retirement Plan
and the health care plan set forth in Schedule 4.10(b)(ii) of the Disclosure
Schedule and (iii) to employees who shall have retired from the Company and its
subsidiaries before the Effective Time), contracts and agreements (including,
but not limited to, employment, consulting and severance obligations, contracts
and agreements, but excluding any Stock Plans) of the Company or any of its
subsidiaries authorized by the Company or any of its subsidiaries on or prior
to the date of this Agreement which apply to any current or former employee or
current or former director of the Company or any of its subsidiaries. Parent
agrees for itself and its subsidiaries that after the Effective Time the
Surviving Corporation or its subsidiaries will pay all amounts provided under
all contracts and agreements of the Company and its subsidiaries and all
benefit obligations of the Company and its subsidiaries, including, without
limitation, the change in control agreements entered into between the Company
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and its subsidiaries and their officers (the "Change in Control Agreements")
(or honor the provisions of the Change in Control Agreements in the case where
no payment by the Surviving Corporation or its subsidiaries is required) condi-
tioned on a change in control of the Company, in accordance with the terms of
such Change in Control Agreements (or will cause any related trusts to make
such payments in the case of funded plans). A true and complete list of such
benefit obligations, contracts and agreements containing "change in control"
provisions is attached as Schedule 4.10(b) of the Disclosure Schedule.
Notwithstanding anything in this Section 4.10(b) to the contrary, nothing
herein shall prevent Parent or the Surviving Corporation from terminating the
employment of any person.
(c) For purposes of all employee benefit plans,
programs and arrangements maintained by or contributed to by Parent and its
subsidiaries (including, without limitation, the Surviving Corporation), Parent
shall, or shall cause its subsidiaries to, cause each such plan, program or
arrangement to treat the prior service with the Company and its subsidiaries of
each person who is an employee of the Company or its subsidiaries immediately
prior to the Effective Time (a "Clark Employee") (to the same extent such
service is recognized under analogous plans, programs or arrangements of
the Company or its subsidiaries prior to the Effective Time) as service
rendered to Parent or its subsidiaries, as the case may be, for purposes of
eligibility to participate and for all benefits and vesting thereunder;
provided, however, that any benefits provided under the Parent Plans (as
defined below) shall be reduced by benefits in respect of the
same years of service under analogous plans, programs and arrangements
maintained by or contributed to by the Company, the Surviving Corporation or
their subsidiaries.
(d) Each Clark Employee who becomes an employee of
Parent or any of its subsidiaries (other than the Surviving Corporation and its
subsidiaries) following the Effective Time (each a "Continued Employee") shall
be entitled, as an employee of Parent or of any of its subsidiaries (other than
the Surviving Corporation and its subsidiaries), to participate in whatever
employee benefit plans, as defined in Section 3(3) of ERISA, or whatever
nonqualified employee benefit or deferred compensation plans, stock option,
bonus or incentive plans or other employee benefit or fringe benefit programs,
that may be in effect generally for employees of Parent or its subsidiaries
from time to time ("Parent Plans") if such Continued Employee shall be eligible
for participation therein and otherwise shall not be participating in a similar
plan which continues to be maintained by the Surviving Corporation and its
subsidiaries. Parent or Parent's subsidiaries shall cause their respective
tax-qualified defined benefit pension plans in which any Continued Employee
will become a participant on or after the Effective Time to be amended to
recognize, for purposes of vesting, eligibility and benefit accrual thereunder,
each Clark Employee's compensation and term of service with the Company and its
subsidiaries to the same extent recognized under analogous plans of the Company
and its subsidiaries prior to the Effective Time; provided, however, that any
benefits under such plans shall be reduced by benefits in respect of the same
years of service under analogous plans, programs and arrangements maintained by
or contributed to by the Company, the Surviving Corporation or their
subsidiaries. Subject to the provisions hereof, Continued Employees will be
eligible to participate on the same basis as similarly situated employees of
Parent or its subsidiaries. All such participation shall be subject to such
terms of such plans as may be in effect from time to time.
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(e) Notwithstanding anything to the contrary in the
Clark Equipment Company Supplemental Executive Retirement Plan ("SERP 1"), the
Clark Equipment Company Supplemental Executive Retirement Trust ("SERP 1
Trust"), the Clark Equipment Company Supplemental Retirement Income Plan for
Certain Executives ("SERP 2") or the Clark Equipment Company Deferred Benefit
Trust ("SERP 2 Trust"), the terms (i) "committee," as used in the SERP 1 Trust
and SERP 2 Trust, (ii) "Administrator," as used in the SERP 1 and SERP 2, (iii)
"Chief Executive Officer" as used in Section 2.3 of the SERP 1 and SERP 2, and
(iv) "Company" as used in Section 4.2 of the SERP 1 and SERP 2, shall in each
instance mean, at all times on and after the Effective Time, the Parent's
benefits committee.
(f) As soon as practicable after the date hereof,
the Company shall use its best efforts to obtain the requisite consents of all
participants and beneficiaries of the Rabbi Trusts so that the Company may
amend the Clark Equipment Company Supplemental Executive Retirement Plan and
the Clark Equipment Company Supplemental Retirement Income Plan for Certain
Executives to permit either the Parent, the Company or any of their respective
subsidiaries to a one-time withdrawal of assets from the Rabbi Trusts to the
extent such assets exceed 100% of the "Plan benefit value" (as such term is
used in Section 3 of each of the Clark Equipment Company Supplemental Executive
Retirement Plan and the Clark Equipment Company Supplemental Retirement Income
Plan for Certain Executives), such funding level to be first certified by the
actuary for the Company's tax-qualified Plan. After such withdrawal, the right
to withdraw amounts from either such Rabbi Trust shall continue as in effect
prior to the amendments contemplated hereby.
4.11 Directors' and Officers' Insurance; Indemni-
fication. (a) The certificate of incorporation and the by-laws of the
Surviving Corporation shall contain provisions with respect to indemnification
and exculpation from liability no less favorable than those set forth in the
Company's certificate of incorporation and by-laws on the date of this
Agreement, which provisions shall not be amended, repealed or otherwise
modified for a period of six years from the Effective Time in any manner that
would adversely affect the rights thereunder of individuals who on or prior to
the Effective Time were directors, officers, employees or agents of the
Company, unless such modification is required by law.
(b) The Company shall, regardless of whether or not
the Merger is consummated, and for six years from the Effective Time, the
Surviving Corporation shall either (x) maintain in effect the Company's current
directors' and officers' liability insurance covering those persons who are
currently covered on the date of this Agreement by the Company's directors' and
officers' liability insurance policy (the "Indemnified Parties"); provided,
however, that in no event shall Parent be required to expend in any one year an
amount in excess of 175% of the annual premiums currently paid by the Company
for such insurance which the Company represents to be $697,500 for the twelve
month period ending March 25, 1996; and; provided further, that if the annual
premiums of such insurance coverage exceed such amount, the Surviving
Corporation shall be obligated to obtain a policy with the greatest coverage
available for a cost not exceeding such amount; provided further, that the
Surviving Corporation may substitute for such Company policies, policies with
at least the same coverage containing terms and conditions which are no less
advantageous and provided that said substitution does not result in any gaps or
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lapses in coverage with respect to matters occurring prior to the Effective
Time or (y) cause the Parent's, directors' and officers' liability insurance
then in effect to cover those persons who are covered on the date of this
Agreement by the Company's directors' and officers' liability insurance policy
with respect to those matters covered by the Company's directors' and officers'
liability policy.
(c) Any Indemnified Party wishing to claim indemni-
fication under paragraph (a) of this Section, upon learning of any such claim,
action, suit, proceeding or investigation, shall promptly notify Parent
thereof. In the event of any such claim, action, suit, proceeding or investi-
gation (whether arising before or after the Effective Time), (i) Parent or the
Surviving Corporation shall have the right, from and after the purchase of
shares of Common Stock pursuant to the Offer, to assume the defense thereof and
Parent shall not be liable to such Indemnified Parties for any legal expenses
of other counsel or any other expenses subsequently incurred by such
Indemnified Parties in connection with the defense thereof, (ii) the
Indemnified Parties will cooperate in the defense of any such matter and (iii)
Parent shall not be liable for any settlement effected without its prior writ-
ten consent; and provided further that Parent shall not have any obligation
hereunder to any Indemnified Party when and if a court of competent
jurisdiction shall ultimately determine, and such determination shall have
become final, that the indemnification of such Indemnified Party in the manner
contemplated hereby is prohibited by applicable law.
4.12 Financing. Pursuant to the commitment letter
received by Parent from the Chase Manhattan Bank (National Association), Parent
shall provide Purchaser with the funds necessary to consummate the Offer and
the Merger and the transactions contemplated hereby in accordance with the
terms hereof.
4.13 Company Board Representation; Section 14(f).
(a) Promptly upon the purchase by Purchaser of Shares pursuant to the Offer,
and from time to time thereafter, Purchaser shall be entitled to designate up
to such number of directors, rounded up to the next whole number, on the Board
of Directors of the Company as shall give Purchaser representation on the Board
of Directors equal to the product of the total number of directors on such
Board (giving effect to the directors elected pursuant to this sentence)
multiplied by the percentage that the aggregate number of shares of Company
Common Stock beneficially owned by Purchaser or any affiliate of Purchaser
bears to the total number of shares of Company Common Stock then outstanding,
and the Company shall, at such time, promptly take all action necessary to
cause Purchaser's designees to be so elected, including either increasing the
size of the Board of Directors or securing the resignations of incumbent
directors or both. At such times, the Company will use its best efforts to
cause persons designated by Purchaser to constitute the same percentage as is
on the Board of (i) each committee of the Board, (ii) each board of directors
of each domestic subsidiary of the Company and (iii) each committee of each
such board, in each case only to the extent permitted by law. Until Purchaser
acquires a majority of the outstanding shares of Company Common Stock on a
fully diluted basis, the Company shall use its reasonable best efforts to
ensure that all the members of the Board and such boards and committees as of
the date hereof who are not employees of the Company shall remain members of
the Board and such boards and committees.
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(b) The Company's obligations to appoint designees to
its Board of Directors shall be subject to Section 14(f) of the Exchange Act
and Rule 14f-1 promulgated thereunder. The Company shall promptly take all
actions required pursuant to Section 14(f) and Rule 14f-1 in order to fulfill
its obligations under this Section 4.13 and shall include in the Schedule 14D-9
or a separate Rule 14f-1 information statement provided to stockholders such
information with respect to the Company and its officers and directors as is
required under Section 14(f) and Rule 14f-1 to fulfill its obligations under
this Section 4.13. Parent or Purchaser will supply to the Company and be
solely responsible for any information with respect to either of them and their
nominees, officers, directors and affiliates required by Section 14(f) and
Rule 14f-1.
(c) Following the election or appointment of Purchaser's
designees pursuant to this Section 4.13 and prior to the Effective Time, any
amendment of this Agreement or the Certificate of Incorporation or By-Laws of
the Company, any termination of this Agreement by the Company, any extension by
the Company of the time for the performance of any of the obligations or other
acts of Purchaser or waiver of any of the Company's rights hereunder, and any
other consent or action by the Board of Directors hereunder, will require the
concurrence of a majority of the directors of the Company then in office who
are neither designated by Purchaser nor are employees of the Company.
4.14 No Amendment to the Rights Agreement. The
Company covenants and agrees that it will not amend the Rights Agreement,
except as expressly contemplated by this Agreement.
4.15 Disposition of Litigation. (a) The Company
agrees to dismiss without prejudice Clark Equipment Company v. Ingersoll-Rand
Company, Civil Action Docket No. 95 CIV 2130 (CSH) (S.D.N.Y. 1995). The
Company agrees that it will not settle any litigation currently pending, or
commenced after the date hereof, against the Company or any of its directors by
any stockholder of the Company relating to the Offer or this Agreement, without
the prior written consent of Parent.
(b) The Company will not voluntarily cooperate with any
third party which has sought or may hereafter seek to restrain or prohibit or
otherwise oppose the Offer or the Merger and will cooperate with Parent and
Purchaser to resist any such effort to restrain or prohibit or otherwise oppose
the Offer or the Merger.
4.16 Proxy Contests. (a) Parent and Purchaser
hereby agree to withdraw and rescind and shall promptly cause to be withdrawn
and rescinded (i) the notice, dated April 3, 1995, pursuant to Article II
Section 10 of the Company's By-Laws and (ii) the Schedule 14A filed with the
Commission, in each case, relating to the nomination of the persons named in
such notice for election to the Company's Board of Directors at the Annual
Meeting of the Company's Stockholders.
(b) From and after the date hereof until the earlier of
(i) the Effective Time and (ii) the termination of this Agreement, neither
Parent nor Purchaser nor any of their affiliates or associates (as such terms
are defined in Rule 12b-2 promulgated under the Exchange Act) will, except as
otherwise expressly permitted or required by this Agreement, directly or
indirectly, alone or through or with others, in any manner
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(i) solicit, make, or in any way participate in, directly or
indirectly, any "solicitation" of "proxies" (as such terms are used in
the proxy rules of the Securities and Exchange Commission promulgated
pursuant to Section 14(a)-11 of the Exchange Act) from the stockholders
of the Company, become a "participant" in any "election contest" (as
such terms are defined or used in Rule 14(a)-11 under the Exchange Act)
with respect to the Board of Directors of the Company, solicit or
execute any written consent in lieu of a meeting of holders of voting
securities except to support the nominees or directors of the Board of
Directors of the Company or any affiliate thereof or call or seek to
have called any meeting of the stockholders of the Company or any
affiliate thereof;
(ii) except as otherwise provided herein, otherwise seek
election to or seek to place a representative on the Board of Directors
of the Company or any affiliate thereof, or seek the removal of any
member of the Board of Directors of the Company or any affiliate
thereof.
4.17 No Solicitation of Transactions. The Company,
its affiliates and their respective officers, directors, employees,
representatives and agents shall immediately cease any existing discussions or
negotiations, if any, with any parties conducted heretofore with respect to any
acquisition or exchange of all or any material portion of the assets of, or any
equity interest in, the Company or any of its subsidiaries (except pursuant to
the VME Sale Agreement) or any business combination with the Company or any of
its subsidiaries. The Company, its subsidiaries, directors, employees,
representatives and agents may, directly or indirectly, furnish information and
access, in each case only in response to a request for such information or
access to any person made after the date hereof which was not initiated,
solicited or knowingly encouraged by the Company or any of its affiliates or
any of its or their respective officers, directors, employees, representatives
or agents after the date hereof (with respect to confidential information,
pursuant to appropriate confidentiality agreements), and may participate in
discussions and negotiate with such entity or group concerning any merger, sale
of assets, sale of shares of capital stock or similar transaction (including an
exchange of stock or assets) involving the Company or any subsidiary or divi-
sion of the Company, if such entity or group has submitted a bona fide proposal
to the Board relating to any such transaction and if a majority of the Board of
Directors of the Company determines, in its good faith judgment, based on the
opinion of independent outside legal counsel to the Company, that failing to
take such action would constitute a breach of such Board's fiduciary
obligations under applicable law. The Company shall promptly notify Parent if
any proposal or offer, or any inquiry or contact with any person with respect
thereto, is made and shall, in any such notice to Parent, indicate in
reasonable detail the identity of the offeror and the terms and conditions of
any proposal or offer, or any such inquiry or contact. The Company shall keep
Parent promptly advised of all developments which could reasonably be expected
to culminate in the Board of Directors withdrawing, modifying or amending its
recommendation of the Offer, the Merger and other transactions contemplated by
this Agreement. Except as set forth in this Section 4.17, neither the Company
or any of its affiliates, nor any of its or their respective officers,
directors, employees, representatives or agents, shall, directly or indirectly,
knowingly encourage, solicit, participate in or initiate discussions or
negotiations with, or provide any information to, any corporation, partnership,
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person or other entity or group (other than Parent and Purchaser, any affiliate
or associate of Parent and Purchaser, or any designees of Parent or Purchaser)
concerning any merger, sale of assets, sale of shares of capital stock or
similar transactions (including an exchange of stock or assets) involving the
Company or any subsidiary or division of the Company; provided, that nothing in
this Section 4.17 shall prevent the Company or the Board from taking, and
disclosing to the Company's stockholders, a position contemplated by Rules 14d-
9 and 14e-2 promulgated under the Exchange Act with regard to any tender offer
or from making such disclosure to the Company's stockholders which, as advised
in an opinion of counsel, is required under applicable law; provided further,
that the Board shall not recommend that the stockholders of the Company tender
their Shares in connection with any such tender offer unless the Board by a
majority vote determines in its good faith judgment based on the opinion of
independent outside legal counsel to the Company, that failing to take such
action would constitute a breach of the Board's fiduciary duty under applicable
law.
4.18 Postponement of Annual Meeting. The Company
shall as soon as possible indefinitely postpone its annual meeting of
stockholders currently scheduled for May 9, 1995, and shall take no action
unless compelled by legal process to reschedule such annual meeting or to call
a special meeting of stockholders of the Company except in accordance with this
Agreement unless and until this Agreement has been terminated in accordance
with its terms.
4.19 Sale of VME. The Company shall use its reason-
able best efforts to take or cause to be taken all such action necessary (i) to
consummate the transactions contemplated by the VME Sale Agreement (which
agreement is described in the Company's Current Report on Form 8-K filed with
the Commission on March 6, 1995) prior to completion of the Offer, including
selling its 50% interest in VME Group N.V. for cash proceeds of not less than
$573 million, or (ii) failing such consummation, to prevent cancellation or
termination of the VME Sale Agreement, amendment thereof in a manner that would
reasonably be expected to have a material adverse effect on the Company, or any
other event which shall cause the VME Sale Agreement to no longer remain in
full force and effect.
ARTICLE V
CONDITIONS PRECEDENT TO MERGER
5.01 Conditions Precedent to Obligations of Parent,
Purchaser and the Company. The respective obligations of Parent and Purchaser,
on the one hand, and the Company, on the other hand, to effect the Merger are
subject to the satisfaction or waiver (subject to applicable law) at or prior
to the Effective Time of each of the following conditions:
(a) Approval of Company's Stockholders. To the extent
required by applicable law, this Agreement and the Merger shall have
been approved and adopted by holders of a majority of the Common Stock
of the Company in accordance with applicable law (if required by appli-
cable law) and the Company's Certificate of Incorporation and By-Laws;
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(b) HSR Act. Any waiting period (and any extension
thereof) under the HSR Act applicable to the Merger shall have expired
or been terminated;
(c) Injunction. No preliminary or permanent injunction
or other order shall have been issued by any court or by any
governmental or regulatory agency, body or authority which prohibits
the consummation of the Offer or the Merger and the transactions
contemplated by this Agreement and which is in effect at the Effective
Time, provided, however, that, in the case of any such decree,
injunction or other order, each of the parties shall have used
reasonable best efforts to prevent the entry of any such injunction or
other order and to appeal as promptly as possible any decree,
injunction or other order that may be entered;
(d) Statutes. No statute, rule, regulation, executive
order, decree or order of any kind shall have been enacted, entered,
promulgated or enforced by any court or governmental authority which
prohibits the consummation of the Offer or the Merger or has the effect
of making the purchase of the Common Stock illegal; and
(e) Payment for Common Stock. Purchaser shall have
accepted for payment and paid for the shares of Common Stock tendered
pursuant to the Offer; provided, that the foregoing will not be a
condition to Parent's and Purchaser's obligation to consummate the
Merger if Purchaser's failure to purchase Shares of Common Stock
violates the terms of the Offer.
ARTICLE VI
TERMINATION AND ABANDONMENT
6.01 Termination. This Agreement may be terminated
and the transactions contemplated hereby may be abandoned, at any time prior to
the Effective Time, whether before or after approval of the Merger by the
Company's stockholders:
(a) by mutual written consent of the Company, on
the one hand, and of Parent and Purchaser, on the other hand;
(b) by either Parent, on the one hand, or the
Company, on the other hand, if any governmental or regulatory agency
located or having jurisdiction within the United States or any country
or economic region in which either the Company or Parent, directly or
indirectly, has material assets or operations shall have issued an
order, decree or ruling or taken any other action permanently
enjoining, restraining or otherwise prohibiting the acceptance for
payment of, or payment for, shares of Common Stock pursuant to the
Offer or the Merger and such order, decree or ruling or other action
shall have become final and nonappealable; provided, that Parent shall,
if necessary to prevent the taking of such action, or the enaction,
enforcement, promulgation, amendment, issuance or application of any
statute, rule, regulation, legislation, interpretation, judgment, order
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or injunction, offer to accept an order to divest such of the Company's
or Parent's assets and businesses as may be necessary to forestall such
injunction or order and to hold separate such assets and business
pending such divestiture, but only if the amount of such assets and
businesses is not material to the assets or profitability of Parent and
its subsidiaries taken as a whole;
(c) by Parent, on the one hand, or the Company, on
the other hand, if due to an occurrence or circumstance which would
result in a failure to satisfy any of the Tender Offer Conditions,
Purchaser shall have failed to pay for Shares pursuant to the Offer on
or prior to the Outside Date, unless such failure has been caused by or
results from the failure of the party seeking to terminate this
Agreement to perform in any material respect any of its respective
covenants or agreements contained in this Agreement. As used herein,
the term "Outside Date" shall mean the latest (not to exceed 150 days)
of (A) 60 days following the date hereof, (B) the date on which either
the applicable waiting period under the HSR Act shall have expired or
been terminated or the final terms of a consent decree between Parent
and the Antitrust Division of the Department of Justice (the "Antitrust
Division") (the "Consenting Parties"), with respect to the Offer and
the Merger have been agreed to by the Consenting Parties, or an order
of a Federal District Court adjudging that the Merger does not violate
the Federal antitrust laws shall have been issued or the Antitrust
Division shall have otherwise authorized the Parent to acquire Shares
pursuant to the Offer, or (C) 10 business days following the conclusion
of any ongoing proceedings before the European Commission in connection
with its review of the transactions contemplated hereby or any similar
delay pursuant to any other material antitrust or competitive law or
regulation;
(d) by Parent, on the one hand, or the Company, on
the other hand, if the Offer is terminated or expires in accordance
with its terms without Purchaser having purchased any Common Stock
thereunder due to a failure of any of the conditions set forth in Annex
A hereto to be satisfied, unless such termination or expiration has
been caused by or results from the failure of the party seeking to
terminate this Agreement to perform in any material respect any of its
respective covenants or agreements contained in this Agreement;
(e) by the Company, if the Board of Directors of
the Company determines that a proposal for a Third Party Acquisition is
a Superior Proposal and a majority of the Board of Directors of the
Company determines, in its good faith judgment, based on the opinion of
independent legal outside counsel to the Company, that a failure to
terminate this Agreement would constitute a breach of such Board's
fiduciary obligations under applicable law; provided, that any such
termination by the Company under this clause (e) shall not be effective
until the Company has made payment of the full fee and expense
reimbursement required by Section 7.01(a) hereof;
(f) prior to the consummation of the Offer, by the
Company, if (i) any of the representations and warranties of Parent or
Purchaser contained in this Agreement were untrue or incorrect in any
material respect when made or have since become, and at the time of
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termination remain, incorrect in any material respect, or (ii) Parent
or Purchaser shall have breached or failed to comply in any material
respect with any of their respective obligations under this Agreement,
which breach shall not have been cured prior to the earlier of (A) 10
days following notice of such breach and (B) two business days prior to
the date on which the Offer expires; or
(g) by Parent prior to the purchase of Shares pur-
suant to the Offer, if (i) there shall have been a breach of any
representation or warranty on the part of the Company contained in this
Agreement which would reasonably be expected to have a material adverse
effect on the Condition of the Company and its subsidiaries taken as a
whole or which would reasonably be expected to prevent (or materially
delay) the consummation of the Offer, (ii) there shall have been a
breach of any covenant or agreement on the part of the Company
contained in this Agreement which would reasonably be expected to have
a material adverse effect on the Condition of the Company and its
subsidiaries taken as a whole or which would reasonably be expected to
prevent (or materially delay) the consummation of the Offer, which
shall not have been cured prior to the earlier of (A) 10 days following
notice of such breach and (B) two business days prior to the date on
which the Offer expires, (iii) the Board shall have withdrawn or
modified (including by amendment of the Schedule 14D-9) in a manner
adverse to Purchaser its approval or recommendation of the Offer, this
Agreement or the Merger and shall not have reinstated such approval or
recommendation within three business days thereof, shall have approved
or recommended another offer or transaction, or shall have resolved to
effect any of the foregoing, or (iv) the Minimum Condition (as defined
in Annex A) shall not have been satisfied by the expiration date of the
Offer and on or prior to such date (A) any person (other than Parent or
Purchaser) shall have made a proposal or public announcement or com-
munication to the Company with respect to a Third Party Acquisition at
a price in excess of $86.00 per Share or (B) any person (including the
Company or any of its affiliates or subsidiaries), other than Parent or
any of its affiliates, shall have become the beneficial owner of more
than 20.0% of the Shares.
"Third Party Acquisition" shall mean the occurrence of
any of the following events: (i) the acquisition of the Company by merger,
tender offer or otherwise by any person other than Parent, Purchaser or any
affiliate thereof (a "Third Party"); (ii) the acquisition by a Third Party of
20.0% or more of the assets of the Company and its subsidiaries, taken as a
whole; (iii) the acquisition by a Third Party of more than 20.0% of the
outstanding Shares; (iv) the adoption by the Company of a plan of liquidation
or the declaration or payment of an extraordinary dividend; or (v) the
repurchase by the Company or any of its subsidiaries of 20.0% or more of the
outstanding Shares.
"Superior Proposal" shall mean a bona fide proposal made
by a Third Party to acquire all of the outstanding shares of the Company
pursuant to a tender offer or a merger, or to purchase all or substantially all
of the assets of the Company, on terms which a majority of the members of the
Board of Directors of the Company determines in its good faith reasonable
judgment (based on the advice of its financial and legal advisors) to be more
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favorable to the Company and its stockholders than the transactions contem-
plated hereby.
6.02 Effect of Termination. In the event of the
termination of this Agreement pursuant to Section 6.01, this Agreement shall
forthwith become void and there shall be no liability on the part of any party
hereto except as set forth in Sections 4.02, 7.01 and 7.15; provided, however,
that nothing herein shall relieve any party from liability for any breach
hereof.
ARTICLE VII
MISCELLANEOUS
7.01 Fees and Expenses. (a) If:
(i) Parent terminates this Agreement pursuant to Section
6.01(g)(iv)(A) hereof, and within twelve months thereafter:
(A) the Company enters into an agreement with
respect to a Third Party Acquisition, or a Third Party
Acquisition occurs, involving any party (or any affiliate
or associate thereof) (x) with whom the Company (or its
agents) had any discussions with respect to a Third Party
Acquisition, (y) to whom the Company (or its agents)
furnished information with respect to or with a view to a
Third Party Acquisition or (z) who had submitted a pro-
posal or expressed any interest publicly or to the
Company in a Third Party Acquisition, in the case of each
of clauses (x), (y) and (z) prior to such termination; or
(B) the Company enters into an agreement with
respect to a Third Party Acquisition, or a Third Party
Acquisition occurs, that contemplates a direct or
indirect consideration (or implicit valuation) for Shares
(including the value of any stub equity) in excess of
$86.00 per Share; or
(ii) the Company terminates this Agreement pursuant to
Section 6.01(e) hereof or Parent terminates this Agreement pursuant to
Section 6.01(g)(iii) or 6.01(g)(iv)(B) hereof;
then the Company shall pay to Parent and Purchaser, within one business day
following the execution and delivery of such agreement or such occurrence, as
the case may be, or simultaneously with any termination contemplated by Section
7.01(a)(ii) above, a fee, in cash, of $35 million, provided, however, that the
Company in no event shall be obligated to pay more than one such fee with
respect to all such agreements and occurrences and such termination.
(b) Except as otherwise specifically provided herein,
all costs and expenses incurred in connection with this Agreement and the
consummation of the transactions contemplated hereby shall be paid by the party
incurring such costs and expenses.
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7.02 Extension; Waiver. Subject to Section 4.13, at
any time prior to the Effective Time, the parties hereto, by action taken by or
on behalf of the respective Boards of Directors of the Company, Parent or
Purchaser, may (i) extend the time for the performance of any of the
obligations or other acts of the other parties hereto, (ii) waive any inaccur-
acies in the representations and warranties contained herein by any other
applicable party or in any document, certificate or writing delivered pursuant
hereto by any other applicable party or (iii) waive compliance with any of the
agreements or conditions contained herein. Any agreement on the part of any
party to any such extension or waiver shall be valid only if set forth in an
instrument in writing signed on behalf of such party.
7.03 Public Announcements. The Company, on the one
hand, and Parent and Purchaser, on the other hand, agree to consult promptly
with each other prior to issuing any press release or otherwise making any
public statement with respect to the Offer, the Merger and the other trans-
actions contemplated hereby, and shall not issue any such press release or make
any such public statement prior to such consultation and review by the other
party of a copy of such release or statement, unless required by applicable law
or any listing agreement with a securities exchange.
7.04 Notices. All notices, requests, demands,
waivers and other communications required or permitted to be given under this
Agreement shall be in writing and shall be deemed to have been duly given if
delivered in person or mailed, certified or registered mail with postage
prepaid, or sent by telex, telegram or telecopier, as follows:
(a) if to the Company, to it at:
Clark Equipment Company
100 North Michigan Street
P.O. Box 7008
South Bend, Indiana 46634
Attention: Bernard D. Henely, Esq.
with a copy to:
White & Case
1155 Avenue of the Americas
New York, New York 10036
Attention: William F. Wynne, Jr., Esq.
(b) if to either Parent or Purchaser, to it at:
Ingersoll-Rand Company
200 Chestnut Ridge Road
Woodcliff Lake, New Jersey 07675
Attention: Patricia Nachtigal, Esq.
with an additional copy to:
Simpson Thacher & Bartlett
425 Lexington Avenue
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New York, NY 10017
Attention: Robert L. Friedman, Esq.
or to such other Person or address as any party shall specify by notice in
writing to each of the other parties. All such notices, requests, demands,
waivers and communications shall be deemed to have been received on the date of
delivery unless if mailed, in which case on the third business day after the
mailing thereof except for a notice of a change of address, which shall be
effective only upon receipt thereof.
7.05 Entire Agreement. This Agreement, the
Disclosure Schedule, the Parent Confidentiality Agreement and the annex and
other documents referred to herein or delivered pursuant hereto, collectively
contain the entire understanding of the parties hereto with respect to the sub-
ject matter contained herein and supersede all prior agreements and under-
standings, oral and written, with respect thereto.
7.06 Binding Effect; Benefit; Assignment. This
Agreement shall inure to the benefit of and be binding upon the parties hereto
and their respective successors and permitted assigns, but neither this
Agreement nor any of the rights, interests or obligations hereunder shall be
assigned by any of the parties hereto without the prior written consent of the
other parties, except that Parent and Purchaser may assign all or any of their
respective rights and obligations hereunder, other than those set forth in
Section 4.07, to any direct or indirect wholly-owned subsidiary or subsidiaries
of Parent, provided that no such assignment shall relieve the assigning party
of its obligations hereunder if such assignee does not perform such
obligations. Nothing in this Agreement, expressed or implied, is intended to
confer on any Person other than the parties hereto or their respective
successors and permitted assigns, any rights, remedies, obligations or lia-
bilities under or by reason of this Agreement, except for Section 4.11, which
is intended to be for the benefit of the persons referred to therein, and may
be enforced by such persons.
7.07 Amendment and Modification. Subject to Section
4.13 and applicable law, this Agreement may be amended, modified and supple-
mented in writing by the parties hereto in any and all respects before the
Effective Time (notwithstanding any stockholder approval of the Merger), by
action taken by the respective Boards of Directors of Parent, Purchaser and the
Company or by the respective officers authorized by such Boards of Directors,
provided, however, that after any such stockholder approval, no amendment shall
be made which by law requires further approval by such stockholders without
such further approval.
7.08 Further Actions. Each of the parties hereto
agrees that, subject to its legal obligations, it will use its reasonable best
efforts to fulfill all conditions precedent specified herein, to the extent
that such conditions are within its control, and to do all things reasonably
necessary to consummate the transactions contemplated hereby.
7.09 Headings. The descriptive headings of the
several Articles and Sections of this Agreement are inserted for convenience
only, do not constitute a part of this Agreement and shall not affect in any
way the meaning or interpretation of this Agreement.
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7.10 Counterparts. This Agreement may be executed
in several counterparts, each of which shall be deemed to be an original, and
all of which together shall be deemed to be one and the same instrument.
7.11 Applicable Law. This Agreement and the legal
relations between the parties hereto shall be governed by and construed in
accordance with the laws of the State of Delaware, without regard to the
conflict of laws rules thereof.
7.12 Severability. If any term, provision, covenant
or restriction contained in this Agreement is held by a court of competent
jurisdiction or other authority to be invalid, void, unenforceable or against
its regulatory policy, the remainder of the terms, provisions, covenants and
restrictions contained in this Agreement shall remain in full force and effect
and shall in no way be affected, impaired or invalidated so long as the
economic or legal substance of the transactions contemplated hereby is not
affected in any manner adverse to any party. Upon such determination that any
term or other provision is invalid, illegal or incapable of being enforced, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible in an
acceptable manner to the end that the transactions contemplated hereby are
fulfilled to the fullest extent possible.
7.13 "Person" Defined. "Person" shall mean and
include an individual, a partnership, a joint venture, a corporation, a trust,
an unincorporated organization, a group and a government or other department or
agency thereof.
7.14 Knowledge of the Company. As to any matter
represented herein as being within the Company's knowledge, to the knowledge or
best knowledge of the Company or any equivalent limitation, such knowledge
shall be deemed to exist only if the matter is within the actual knowledge of
the Chief Executive Officer or any Vice President of the Company.
7.15 Non-Survival of Representations, Warranties and
Agreements. The representations, warranties and agreements in this Agreement
shall terminate at the Effective Time or upon the termination of this Agreement
pursuant to Section 6.01 as the case may be, except that the agreements set
forth in Article II, Section 4.07, Section 4.10, Section 4.11 and Article VII
shall survive the Effective Time indefinitely and those set forth in Section
4.02 and Article VII shall survive termination indefinitely.
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<PAGE>
IN WITNESS WHEREOF, each of Parent, Purchaser and the
Company have caused this Agreement to be executed by their respective officers
thereunto duly authorized, all as of the date first above written.
INGERSOLL-RAND COMPANY
By /s/ James E. Perrella
Name: James E. Perrella
Title: Chairman, President
and Chief Executive
Officer
CEC ACQUISITION CORP.
By /s/ Thomas F. McBride
Name: Thomas F. McBride
Title: President
CLARK EQUIPMENT COMPANY
By /s/ Leo J. McKernan
Name: Leo J. McKernan
Title: Chairman, President
and Chief Executive
Officer
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<PAGE>
ANNEX A
to
Agreement and
Plan of Merger
The capitalized terms used in this Annex A shall have the
meanings set forth in the Agreement to which it is annexed, except that the
term "Merger Agreement" shall be deemed to refer to the Agreement to which
this Annex A is appended.
Notwithstanding any other provision of the Offer, Purchaser
shall not be required to accept for payment or subject to any applicable rules
and regulations of the Commission, including Rule 14e-1c under the Exchange Act
(relating to Purchaser's obligation to pay for or return tendered shares
promptly after termination or withdrawal of the Offer), pay for any shares of
Common Stock tendered and may terminate or amend the Offer in accordance with
the Merger Agreement and may postpone the acceptance of, and payment for,
shares of Common Stock, if (i) there shall not have been validly tendered and
not withdrawn prior to the expiration of the Offer a number of shares of Common
Stock which, together with Common Stock owned by Parent and Purchaser, repre-
sent a majority of the total voting power of all shares of capital stock of the
Company outstanding on a fully diluted basis (the "Minimum Condition"), (ii)
subject to the proviso contained in paragraph (a) below, any applicable waiting
period under the HSR Act or under any applicable foreign statutes or
regulations in a jurisdiction where Parent or the Company, directly or
indirectly, has material operations or a material amount of assets shall not
have expired or been terminated or (iii) at any time on or after the date of
the Merger Agreement and at or before the time of payment for any such shares
of Common Stock (whether or not any shares of Common Stock have theretofore
been accepted for payment or paid for pursuant to the Offer) any of the follow-
ing shall occur:
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(a) there shall be any action taken, or any statute, rule,
regulation, legislation, interpretation, judgment, order or injunction
enacted, enforced, promulgated, amended, issued or deemed applicable to
the Offer, by any legislative body, court, government or governmental,
administrative or regulatory authority or agency, domestic or foreign,
other than the routine application of the waiting period provisions of
the HSR Act to the Offer or to the Merger, that would reasonably be
expected to: (i) make illegal or otherwise prohibit or materially delay
consummation of the Offer or the Merger or seek to obtain material dam-
ages or make materially more costly the making of the Offer, (ii) pro-
hibit or materially limit the ownership or operation by Parent or
Purchaser of all or any material portion of the business or assets of
the Company or any of its subsidiaries taken as a whole or compel
Parent or Purchaser to dispose of or hold separately all or any
material portion of the business or assets of Parent or Purchaser or
the Company or any of its subsidiaries taken as a whole, or seek to im-
pose any material limitation on the ability of Parent or Purchaser to
conduct its business or own such assets, (iii) impose material limita-
tions on the ability of Parent or Purchaser effectively to acquire,
hold or exercise full rights of ownership of the shares of Common
Stock, including, without limitation, the right to vote any shares of
Common Stock acquired or owned by Purchaser or Parent on all matters
properly presented to the Company's stockholders, or (iv) require
divestiture by Parent or Purchaser of any shares of Common Stock;
provided, that Parent shall, if necessary to prevent the taking of such
action, or the enaction, enforcement, promulgation, amendment, issuance
or application of any statute, rule, regulation, legislation,
interpretation, judgment, order or injunction, offer to accept an order
to divest such of the Company's or Parent's assets and businesses as
may be necessary to forestall such injunction or order and to hold
separate such assets and business pending such divestiture, but only if
the amount of such assets and businesses is not material to the assets
or profitability of Parent and its subsidiaries taken as a whole;
(b) there shall have occurred any development that has, or
would reasonably be expected to have, a material adverse effect on the
business, assets, financial condition or results of operations of the
Company and its subsidiaries taken as a whole;
(c) there shall have occurred (i) any general suspension of
trading in, or limitation on prices for, securities on the New York
Stock Exchange, (ii) any decline in the Standard & Poor's 500 in excess
of 25% measured from the close of business on the trading day next
preceding the date of the Merger Agreement, (iii) a declaration of a
banking moratorium or any suspension of payments in respect of banks in
the United States, (iv) any material limitation by any U.S., federal or
state government or governmental, administrative or regulatory
authority or agency on the extension of credit by banks or other
lending institutions, or (v) a commencement or escalation of a war or
armed hostilities or other national or international calamity directly
or indirectly involving the United States and having a material adverse
effect on the business, assets, financial condition or results of
operations of the Company and its subsidiaries taken as a whole or
materially adversely affecting (or materially delaying) the
consummation of the Offer;
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<PAGE>
(d)(i) it shall have been publicly disclosed or Purchaser
shall have otherwise learned that beneficial ownership (determined for
the purposes of this paragraph as set forth in Rule 13d-3 promulgated
under the Exchange Act) of more than 20.0% of the outstanding Shares
has been acquired by any corporation (including the Company or any of
its subsidiaries or affiliates), partnership, person or other entity or
group (as defined in Section 13(d)(3) of the Exchange Act), other than
Parent or any of its affiliates, or (ii) (A) the Board of Directors of
the Company or any committee thereof shall have withdrawn or modified
in a manner adverse to Parent or Purchaser the approval or
recommendation of the Offer, the Merger or the Merger Agreement, or
approved or recommended any takeover proposal or any other acquisition
of Shares other than the Offer and the Merger, (B) any corporation,
partnership, person or other entity or group shall have entered into a
definitive agreement or an agreement in principle with the Company with
respect to a tender offer or exchange offer for any Shares or a merger,
consolidation or other business combination with or involving the
Company or any of its subsidiaries, or (C) the Board of Directors of
the Company or any committee thereof shall have resolved to do any of
the foregoing;
(e) any of the representations and warranties of the Company
set forth in the Merger Agreement that are qualified as to materiality
shall not be true and correct, or any such representations and
warranties that are not so qualified shall not be true and correct in
any respect which would reasonably be expected to have a material
adverse effect on the business, assets, results of operations or
financial condition of the Company and its subsidiaries taken as a
whole, in each case as if such representations and warranties were made
at the time of such determination except as to any such representation
or warranty which speaks as of a specific date, which must be untrue or
incorrect in the foregoing respects as of such specific date;
(f) the Company shall have failed to perform in any material
respect any obligation or to comply in any material respect with any
agreement or covenant of the Company to be performed or complied with
by it under the Merger Agreement;
(g)(x) the Company shall not have consummated the
sale of its 50% interest in VME Group N.V. for cash proceeds of
not less than $573 million and (y) the definitive agreement to
sell such interest to AB Volvo of Sweden 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 is materially adverse
to the Company, or shall otherwise no longer remain in full
force and effect; or
(h) the Merger Agreement shall have been terminated in
accordance with its terms;
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<PAGE>
which, in the reasonable judgment of Purchaser, in any such case and regardless
of the circumstances giving rise to any such condition, makes it inadvisable to
proceed with such acceptance for payment or payment.
The foregoing conditions (including those set forth in clauses
(i)-(iii) above) are for the sole benefit of Purchaser and may be asserted by
Purchaser, or may be waived by Purchaser, in whole or in part at any time and
from time to time in its sole discretion. The failure by 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. Any determination by Purchaser
concerning the events described in this Annex A will be final and binding upon
all parties.
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April 9, 1995
LETTER OF INTENT
Gentlemen:
Ingersoll-Rand Company, through a designated subsidiary, hereby
proposes to acquire Clark Equipment Company ("the Company"). We are prepared
to make an offer to acquire 100% of the Company's common stock for a cash
purchase price of $86.00 per share subject to the execution of the attached
agreement and plan of merger.
In submitting this proposal it is our understanding that it is not
deemed self-executing and that our respective legal obligations shall arise
solely from the definitive merger agreement described above.
Very truly yours,
INGERSOLL-RAND COMPANY
By /s/ James E. Perrella
Agreed to as of
April 9, 1995
CLARK EQUIPMENT COMPANY
By: /s/ Leo J. McKernan
