<PAGE>
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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
SCHEDULE 14D-1
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(D)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
AND
SCHEDULE 13D
UNDER THE SECURITIES EXCHANGE ACT OF 1934
------------------------
ABT BUILDING PRODUCTS CORPORATION
(Name of Subject Company)
------------------------
STRIPER ACQUISITION, INC.
LOUISIANA-PACIFIC CORPORATION
(Bidders)
COMMON STOCK, PAR VALUE $0.01 PER SHARE
(Title of Class of Securities)
------------------------
000782102
(CUSIP Number of Class of Securities)
GARY WILKERSON, ESQ.
VICE PRESIDENT AND GENERAL COUNSEL
LOUISIANA-PACIFIC CORPORATION
111 S.W. FIFTH AVENUE
PORTLAND, OREGON 97204
(503) 221-0800
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidders)
------------------------
COPIES TO:
ROBERT A. PROFUSEK, ESQ.
MARK E. BETZEN, ESQ.
JONES, DAY, REAVIS & POGUE
599 LEXINGTON AVENUE
NEW YORK, NEW YORK 10022
(212 326-3939
------------------------
CALCULATION OF FILING FEE
<TABLE>
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TRANSACTION VALUATION* AMOUNT OF FILING FEE**
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$197,948,775 $39,590
</TABLE>
* Estimated for purposes of calculating the filing fee only. Such amount was
derived by multiplying $15.00, the amount offered for each share of common
stock, par value $0.01 per share (the "Shares"), of ABT Building Products
Corporation, by the sum of (i) 10,674,160 representing all of the Shares
that were issued and outstanding as of January 14, 1999 and (ii) 2,522,425,
representing all of the Shares reserved for issuance upon the exercise of
all outstanding options to purchase Shares that were outstanding as of
January 14, 1999.
** 1/50th of 1% of the value of the transaction.
/ / Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the form
or schedule and the date of its filing.
<TABLE>
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AMOUNT PREVIOUSLY PAID: NOT APPLICABLE FILING PARTY: NOT APPLICABLE
FORM OR REGISTRATION NO.: NOT APPLICABLE DATE FILED: NOT APPLICABLE
</TABLE>
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<PAGE>
14D-1
<TABLE>
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CUSIP NO. 000782102
</TABLE>
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1. NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
Striper Acquisition, Inc.
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) / /
(b) /X/
3. SEC USE ONLY
4. SOURCES OF FUNDS
AF (See Item 4 below)
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS / /
2(e) OR 2(f)
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
4,952,554
8. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN SHARES / /
9. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
46.4%
10. TYPE OF REPORTING PERSON
CO
</TABLE>
<PAGE>
14D-1
<TABLE>
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CUSIP NO. 000782102
</TABLE>
<TABLE>
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1. NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSONS
Louisiana-Pacific Corporation
93-0609074
2. CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP:
(a) / /
(b) /X/
3. SEC USE ONLY
4. SOURCES OF FUNDS
WC, BK (See Item 4 below)
5. CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS / /
2(e) OR 2(f)
6. CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
7. AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
4,952,554
8. CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN SHARES / /
9. PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
46.4%
10. TYPE OF REPORTING PERSON
CO
</TABLE>
<PAGE>
This Tender Offer Statement on Schedule 14D-1 is filed by Louisiana-Pacific
Corporation, a Delaware corporation ("Parent"), and Striper Acquisition, Inc., a
Delaware corporation and a wholly owned subsidiary of Parent ("Purchaser"),
relating to the offer by Purchaser to purchase all of the outstanding shares of
common stock, par value $0.01 per share (the "Shares"), of ABT Building Products
Corporation, a Delaware corporation ("Company"), at a purchase price of $15.00
per Share, net to the seller in cash, on the terms and subject to the conditions
set forth in the Offer to Purchase, dated January 25, 1999 (the "Offer to
Purchase"), and in the related Letter of Transmittal and any amendments or
supplements thereto, copies of which are attached hereto as Exhibits (a)(1) and
(a)(2), respectively (which collectively constitute the "Offer").
This Tender Offer Statement on Schedule 14D-1 also constitutes a Statement
on Schedule 13D with respect to the acquisition by Parent and Purchaser of
beneficial ownership of certain Shares pursuant to the Stockholder Agreement
described in the Offer to Purchase. The item numbers and responses thereto below
are in accordance with the requirements of Schedule 14D-1.
ITEM 1. SECURITY AND SUBJECT COMPANY
(a) The name of the subject company is ABT Building Products Corporation, a
Delaware corporation. The address of its principal executive offices is One
Neenah Center, Neenah, Wisconsin 54956. The telephone number of Company at such
location is (920) 751-8611.
(b) The information set forth on the cover page and under "Introduction" in
the Offer to Purchase is incorporated herein by reference.
(c) The information set forth in Section 6 ("Price Range of the Shares;
Dividends on the Shares") of the Offer to Purchase is incorporated herein by
reference.
ITEM 2. IDENTITY AND BACKGROUND
(a)-(d),(g) This Statement is filed by Purchaser and Parent. The
information set forth on the cover page, under "Introduction," in Section 9
("Certain Information Concerning Purchaser and Parent") and in Schedule I of the
Offer to Purchase is incorporated herein by reference.
(e)-(f) None of Purchaser, Parent or, to the knowledge of Purchaser and
Parent, any of the persons listed in Schedule I to the Offer to Purchase has
during the last five years been (i) convicted in a criminal proceeding
(excluding traffic violations or similar misdemeanors) or (ii) a party to a
civil proceeding of a judicial or administrative body of a competent
jurisdiction and as a result of such proceeding was or is subject to a judgment,
decree or final order enjoining future violations of, or prohibiting activities
subject to, federal or state securities laws or finding any violation of such
laws.
ITEM 3. PAST CONTACTS, TRANSACTIONS, OR NEGOTIATIONS WITH THE SUBJECT COMPANY
(a)-(b) The information set forth under "Introduction" and in Sections 8
("Certain Information Concerning Company"), 9 ("Certain Information Concerning
Purchaser and Parent"), 11 ("Background of the Offer") and 12 ("Purpose of the
Offer and the Merger; Plans for Company; the Merger Agreement; the Stockholder
Agreement; Other Matters") of the Offer to Purchase is incorporated herein by
reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
(a)-(b) The information set forth in Section 10 ("Source and Amount of
Funds") of the Offer to Purchase is incorporated herein by reference.
(c) Not applicable.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER
(a)-(e) The information set forth under "Introduction" and in Section 12
("Purpose of the Offer and the Merger; Plans for Company; the Merger Agreement;
the Stockholder Agreement; Other Matters") of the Offer to Purchase is
incorporated herein by reference.
<PAGE>
(f)-(g) The information set forth in Section 7 ("Effect of the Offer on the
Market for the Shares, NASDAQ Quotation and Exchange Act Registration and Margin
Securities") of the Offer to Purchase is incorporated herein by reference.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY
(a)-(b) The information set forth on the cover page and under
"Introduction" and in Sections 9 ("Certain Information Concerning Purchaser and
Parent") and 12 ("Purpose of the Offer and the Merger; Plans for Company; the
Merger Agreement; the Stockholder Agreement; Other Matters") of the Offer to
Purchase is incorporated herein by reference.
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO THE SUBJECT COMPANY'S SECURITIES
The information set forth under "Introduction" and in Sections 9 ("Certain
Information Concerning Purchaser and Parent") and 12 ("Purpose of the Offer and
the Merger; Plans for Company; the Merger Agreement; the Stockholder Agreement;
Other Matters") of the Offer to Purchase is incorporated herein by reference.
ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED
The information set forth under "Introduction" and in Section 16 ("Fees and
Expenses") of the Offer to Purchase is incorporated herein by reference.
ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS
The information set forth in Section 9 ("Certain Information Concerning
Purchaser and Parent") of the Offer to Purchase is incorporated herein by
reference.
ITEM 10. ADDITIONAL INFORMATION
(a) The information set forth under "Introduction" and in Sections 9
("Certain Information Concerning Purchaser and Parent") and 12 ("Purpose of the
Offer and the Merger; Plans for Company; the Merger Agreement; the Stockholder
Agreement; Other Matters") of the Offer to Purchase is incorporated herein by
reference.
(b)-(c) The information set forth in Sections 14 ("Certain Conditions of
the Offer") and 15 ("Certain Legal Matters") of the Offer to Purchase is
incorporated herein by reference.
(d) The information set forth in Section 7 ("Effect of the Offer on the
Market for Shares, NASDAQ Quotation and Exchange Act Registration, and Margin
Securities") of the Offer to Purchase is incorporated herein by reference.
(e) Not applicable.
(f) The information set forth in the Offer to Purchase and the Letter of
Transmittal, copies of which are attached hereto as Exhibits (a)(1) and (a)(2),
respectively, is incorporated herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS
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(a)(1) Offer to Purchase, dated January 25, 1999
(a)(2) Letter of Transmittal
(a)(3) Notice of Guaranteed Delivery
(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees
(a)(5) Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and
Other Nominees
(a)(6) Guidelines for Certification of Taxpayer Identification Number on Substitute Form
W-9
(a)(7) Text Summary Advertisement dated January 25, 1999
(a)(8) Text of Press Release of Parent, dated January 19, 1999
</TABLE>
<PAGE>
<TABLE>
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(b)(1) Credit Agreement, dated as of January 31, 1997, among Parent, Louisiana-Pacific
Canada Ltd., Bank of America National Trust and Savings Association and the other
financial institutions party thereto (incorporated by reference to Exhibit 4.A.2 to
Parent's Annual Report on Form 10-K for the year ended December 31, 1996)
(b)(2) Consent and First Amendment to Credit Agreement dated as of December 31, 1997 among
Parent, Louisiana-Pacific Canada Ltd., Louisiana-Pacific Canada Pulp Co., Bank of
America National Trust and Savings Association and the other financial institutions
party thereto
(b)(3) Letter from Bank of America to Parent, dated January 14, 1999, and letter from
Parent to Bank of America, dated January 13, 1999
(c)(1) Agreement and Plan of Merger, dated January 19, 1999, among Parent, Purchaser and
Company
(c)(2) Stockholder Agreement, dated January 19, 1999, among Parent, Purchaser, Kohlberg
Associates, L.P., KABT Acquisition Company, L.P. and George T. Brophy
(d) Not applicable
(e) Not applicable
(f) Not applicable
</TABLE>
<PAGE>
SIGNATURES
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.
<TABLE>
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Dated: January 25, 1999 STRIPER ACQUISITION, INC.
By: /s/ MARK A. SUWYN
-----------------------------------------
Name: Mark A. Suwyn
Title: President
Dated: January 25, 1999 LOUISIANA-PACIFIC CORPORATION
By: /s/ GARY C. WILKERSON
-----------------------------------------
Name: Gary C. Wilkerson
Title: Vice President and
General Counsel
</TABLE>
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT DESCRIPTION PAGE
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(a)(1) Offer to Purchase, dated January 25, 1999......................................................
(a)(2) Letter of Transmittal..........................................................................
(a)(3) Notice of Guaranteed Delivery..................................................................
(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees...............
(a)(5) Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust Companies and Other
Nominees.......................................................................................
(a)(6) Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9..........
(a)(7) Text of Summary Advertisement dated January 25, 1999...........................................
(a)(8) Text of Press Release of Parent, dated January 19, 1999........................................
(b)(1) Credit Agreement dated as of January 31, 1997, among Parent, Louisiana-Pacific Canada Ltd.,
Bank of America National Trust and Savings Association and the other financial institutions
party thereto (incorporated by reference to Exhibit 4.A.2 to Parent's Annual Report on Form
10-K for the year ended December 31, 1996).....................................................
(b)(2) Consent and First Amendment to Credit Agreement dated as of December 31, 1997 among Parent,
Louisiana-Pacific Canada Ltd., Louisiana-Pacific Canada Pulp Co., Bank of America National
Trust and Savings Association and the other financial institutions party thereto...............
(b)(3) Letter from Bank of America to Parent dated January 14, 1999, and letter from Parent to Bank of
America dated January 13, 1999.................................................................
(c)(1) Agreement and Plan of Merger, dated January 19, 1999, among Parent, Purchaser and Company......
(c)(2) Stockholder Agreement, dated January 19, 1999, among Parent, Purchaser, Kohlberg Associates,
L.P., KABT Acquisition Company, L.P. and George T. Brophy......................................
(d) Not applicable.................................................................................
(e) Not applicable.................................................................................
(f) Not applicable.................................................................................
</TABLE>
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
ABT BUILDING PRODUCTS CORPORATION
AT
$15.00 NET PER SHARE
BY
STRIPER ACQUISITION, INC.
A WHOLLY OWNED SUBSIDIARY
OF
LOUISIANA-PACIFIC CORPORATION
- ------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON TUESDAY, FEBRUARY 23, 1999, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
THE BOARD OF DIRECTORS OF ABT BUILDING PRODUCTS CORPORATION ("COMPANY") HAS
UNANIMOUSLY DETERMINED THAT EACH OF THE OFFER AND THE MERGER DESCRIBED HEREIN IS
FAIR TO, AND IN THE BEST INTERESTS OF, COMPANY'S STOCKHOLDERS (THE
"STOCKHOLDERS"), HAS UNANIMOUSLY APPROVED THE MERGER AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE OFFER AND THE MERGER, AND
UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS ACCEPT THE OFFER AND TENDER ALL OF
THEIR SHARES PURSUANT THERETO.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY
TENDERED, AND NOT WITHDRAWN PRIOR TO THE EXPIRATION DATE (AS DEFINED HEREIN),
THAT NUMBER OF SHARES OF COMMON STOCK, PAR VALUE $0.01 PER SHARE, OF COMPANY
WHICH (TOGETHER WITH ANY SHARES OWNED BY LOUISIANA-PACIFIC CORPORATION OR ITS
SUBSIDIARIES) CONSTITUTES A MAJORITY OF THE SHARES OF COMMON STOCK OUTSTANDING
ON A FULLY DILUTED BASIS ON THE DATE OF PURCHASE. THE OFFER IS ALSO SUBJECT TO
CERTAIN OTHER CONDITIONS CONTAINED IN THIS OFFER TO PURCHASE. SEE SECTION 14 OF
THIS OFFER TO PURCHASE.
------------------------
IMPORTANT
Any Stockholder desiring to tender all or a portion of its Shares should
either (1) complete and sign the appropriate Letter(s) of Transmittal (or a
manually signed facsimile thereof) in accordance with the instructions in such
Letter(s) of Transmittal, mail or deliver such Letter(s) of Transmittal and any
other required documents to the Depositary and either deliver the certificates
for those Shares to the Depositary along with such Letter(s) of Transmittal or
tender those Shares pursuant to the procedures for book-entry transfer set forth
in Section 3 hereof or (2) request its broker, dealer, commercial bank, trust
company or other nominee to effect the tender on its behalf. Any Stockholder
whose Shares are registered in the name of a broker, dealer, commercial bank,
trust company or other nominee must contact that broker, dealer, commercial
bank, trust company or other nominee if the Stockholder desires to tender such
Shares.
Any Stockholder who desires to tender Shares and whose certificate(s)
representing those Shares are not immediately available or who cannot comply
with the procedure for book-entry transfer on a timely basis should tender those
Shares by following the procedures for guaranteed delivery set forth in Section
3 hereof.
Questions and requests for assistance may be directed to the Information
Agent or the Dealer Managers at their respective addresses and telephone numbers
set forth on the back cover of this Offer to Purchase. Requests for additional
copies of this Offer to Purchase, the Letter of Transmittal and other related
materials may be directed to the Information Agent or to brokers, dealers,
commercial banks or trust companies.
------------------------
The Dealer Managers for the Offer are:
GOLDMAN, SACHS & CO.
The date of this Offer to Purchase is January 25, 1999.
<PAGE>
TABLE OF CONTENTS
<TABLE>
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PAGE
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INTRODUCTION............................................................................................... 1
1. Terms of the Offer..................................................................................... 2
2. Acceptance for Payment and Payment for Shares.......................................................... 4
3. Procedure for Tendering Shares......................................................................... 5
4. Withdrawal Rights...................................................................................... 7
5. Certain Federal Income Tax Consequences of the Offer and the Merger.................................... 8
6. Price Range of the Shares; Dividends on the Shares..................................................... 9
7. Effect of the Offer on the Market for Shares, NASDAQ Quotation and Exchange Act Registration and Margin
Securities............................................................................................. 9
8. Certain Information Concerning Company................................................................. 11
9. Certain Information Concerning Purchaser and Parent.................................................... 15
10. Source and Amount of Funds............................................................................. 17
11. Background of the Offer................................................................................ 17
12. Purpose of the Offer and the Merger; Plans for Company; the Merger Agreement; the Stockholder
Agreement; Other Matters............................................................................... 19
13. Dividends and Distributions............................................................................ 30
14. Certain Conditions of the Offer........................................................................ 31
15. Certain Legal Matters.................................................................................. 33
16. Fees and Expenses...................................................................................... 35
17. Miscellaneous.......................................................................................... 35
SCHEDULE I................................................................................................. I-1
</TABLE>
<PAGE>
To the Holders of Common Stock of
ABT Building Products Corporation:
INTRODUCTION
Striper Acquisition, Inc., a Delaware corporation ("Purchaser"), hereby
offers to purchase all of the outstanding shares (the "Shares") of common stock,
par value $0.01 per share (the "Common Stock"), of ABT Building Products
Corporation, a Delaware corporation ("Company"), at a purchase price of $15.00
per Share, net to the seller in cash (the "Offer Consideration"), upon the terms
and subject to the conditions set forth in this Offer to Purchase and in the
related Letter of Transmittal (which, together with any amendments or
supplements hereto or thereto, collectively constitute the "Offer"). Purchaser
is a direct, wholly owned subsidiary of Louisiana-Pacific Corporation, a
Delaware corporation ("Parent").
The Offer is being made pursuant to an Agreement and Plan of Merger, dated
as of January 19, 1999 (the "Merger Agreement"), among Parent, Purchaser and
Company. The Merger Agreement provides, among other things, for the commencement
of the Offer by Purchaser and further provides that after the purchase of Shares
pursuant to the Offer, subject to the satisfaction or waiver of certain
conditions, Purchaser will be merged with and into Company (the "Merger"), with
Company surviving the Merger as a wholly owned subsidiary of Parent (the
"Surviving Corporation"). In the Merger, each Share (excluding Shares owned by
Company or any of its subsidiaries or by Parent, Purchaser or any other
subsidiary of Parent, and Shares owned by Stockholders who have properly
exercised their appraisal rights under Delaware law) issued and outstanding
immediately prior to the effective time of the Merger (the "Effective Time")
will be converted at the Effective Time into the right to receive the Offer
Consideration, in cash, without interest and less any required withholding taxes
(the "Merger Consideration").
THE BOARD OF DIRECTORS OF COMPANY (THE "BOARD") HAS UNANIMOUSLY DETERMINED
THAT EACH OF THE OFFER AND THE MERGER IS FAIR TO, AND IN THE BEST INTERESTS OF,
THE STOCKHOLDERS, HAS UNANIMOUSLY APPROVED THE MERGER AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE OFFER AND THE MERGER, AND
UNANIMOUSLY RECOMMENDS THAT THE STOCKHOLDERS ACCEPT THE OFFER AND TENDER ALL OF
THEIR SHARES PURSUANT THERETO.
WARBURG DILLON READ LLC, ONE OF COMPANY'S FINANCIAL ADVISORS ("WDR"), HAS
DELIVERED TO COMPANY ITS OPINION THAT THE CONSIDERATION TO BE RECEIVED BY THE
STOCKHOLDERS IN THE OFFER AND THE MERGER IS FAIR, FROM A FINANCIAL POINT OF
VIEW, TO THE STOCKHOLDERS. A COPY OF THE WRITTEN OPINION OF WDR IS CONTAINED IN
COMPANY'S SOLICITATION/RECOMMENDATION STATEMENT ON SCHEDULE 14D-9 (THE "SCHEDULE
14D-9") FILED WITH THE SECURITIES AND EXCHANGE COMMISSION (THE "COMMISSION") IN
CONNECTION WITH THE OFFER, A COPY OF WHICH IS BEING FURNISHED TO THE
STOCKHOLDERS CONCURRENTLY WITH THIS OFFER TO PURCHASE.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION DATE (AS DEFINED IN SECTION
1) THAT NUMBER OF SHARES WHICH (TOGETHER WITH ANY SHARES OWNED BY PARENT OR ANY
OF ITS SUBSIDIARIES) CONSTITUTES A MAJORITY OF THE SHARES OUTSTANDING ON A FULLY
DILUTED BASIS ON THE DATE OF PURCHASE (THE "MINIMUM SHARE CONDITION"). THE OFFER
ALSO IS SUBJECT TO CERTAIN OTHER CONDITIONS. SEE SECTIONS 1 AND 14.
Company has informed Purchaser that, as of January 14, 1999, (i) 10,674,160
Shares were issued and outstanding, (ii) 2,522,425 Shares were reserved for
issuance to holders of outstanding stock options granted by Company, and (iii)
no shares of preferred stock, par value $0.01 per share, of Company were issued
and outstanding. Based upon the Shares and vested stock options outstanding as
of such date, at least 6,234,806 Shares would need to be validly tendered
pursuant to the Offer and not withdrawn in order for the Minimum Share Condition
to be satisfied. Pursuant to a Stockholder Agreement entered into among Parent,
Purchaser and certain Stockholders (the "Principal Stockholders") which
collectively own 4,952,554 Shares, or approximately 46.4% of the Shares
outstanding as of January 14, 1999 (and one of whom holds options to purchase an
additional 710,000 Shares from Company), the Principal Stockholders have agreed
to tender all of such outstanding Shares pursuant to the Offer and to certain
other matters. See "Purpose of the Offer and the Merger; Plans for Company; the
Merger Agreement; the Stockholder Agreement; Other Matters."
<PAGE>
The consummation of the Merger is subject to the satisfaction or waiver of a
number of conditions, including, if required, the approval of the Merger by the
requisite vote or consent of the Stockholders. The Stockholder vote necessary to
approve the Merger is the affirmative vote of a majority of the outstanding
Shares, including Shares held by Purchaser and its affiliates. If the Minimum
Share Condition is satisfied and Purchaser purchases Shares pursuant to the
Offer, Purchaser will be able to effect the Merger without the affirmative vote
of any other Stockholder. If Purchaser acquires at least 90% of the outstanding
Shares pursuant to the Offer or otherwise, Purchaser will be able to effect the
Merger pursuant to the "short-form" merger provisions of Section 253 of the
Delaware General Corporation Law (the "DGCL"), without prior notice to, or any
action by, any other Stockholder. In that event, Purchaser intends to effect the
Merger as promptly as practicable following the purchase of Shares in the Offer.
See Section 12.
The Merger Agreement is more fully described in Section 12. Certain federal
income tax consequences of the sale of Shares pursuant to the Offer and the
exchange of Shares for the Merger Consideration pursuant to the Merger are
described in Section 5.
Tendering Stockholders will not be obligated to pay brokerage fees or
commissions or, except as set forth in Instruction 6 to the Letter of
Transmittal, transfer taxes on the purchase of Shares pursuant to the Offer or
the Merger. Purchaser will pay all charges and expenses of Goldman, Sachs & Co.,
as the Dealer Managers (the "Dealer Managers"), First Chicago Trust Company of
New York, as the depositary (the "Depositary"), and D.F. King & Co., Inc., as
the information agent (the "Information Agent"), in connection with the Offer.
See Section 16.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION WHICH SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE
WITH RESPECT TO THE OFFER.
1. TERMS OF THE OFFER
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any such extension or
amendment), Purchaser will accept for payment (and thereby purchase) all Shares
that are validly tendered and not withdrawn in accordance with Section 4 prior
to the Expiration Date. As used in the Offer, the term "Expiration Date" means
12:00 midnight, New York City time, on February 23, 1999, unless and until
Purchaser, in accordance with the terms of the Offer and the Merger Agreement,
shall have extended the period of time during which the Offer is open, in which
event the term "Expiration Date" means the latest time and date at which the
Offer, as so extended, expires. As used in this Offer to Purchase, "business
day" has the meaning set forth in Rule 14d-1(e)(6) under the Securities Exchange
Act of 1934, as amended (the "Exchange Act").
In the event that the Offer is not consummated, Purchaser may seek to
acquire Shares through open-market purchases, privately negotiated transactions
or otherwise, upon such terms and conditions and at such prices as it shall
determine, which may be more or less than the Offer Consideration and could be
for cash or other consideration.
The Offer is conditioned upon, among other things, satisfaction of the
Minimum Share Condition and the expiration or termination of all waiting periods
imposed by the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended,
and the regulations thereunder (the "HSR Act"). The Offer is also subject to
certain other conditions set forth in Section 14. Subject to the terms of the
Merger Agreement, Purchaser expressly reserves the right (but will not be
obligated) to waive any or all of the conditions to the Offer. If by the
Expiration Date any or all of the conditions to the Offer are not satisfied or
waived, Purchaser may extend the Expiration Date until such time as all such
conditions are satisfied or waived. Subject to the terms of the Merger Agreement
and the rights of tendering Stockholders to withdraw their Shares, Purchaser
will retain all tendered Shares until the Expiration Date.
2
<PAGE>
Subject to applicable law and the terms of the Merger Agreement, Purchaser
expressly reserves the right to extend the period of time during which the Offer
is open by giving oral followed by written notice of such extension to the
Depositary and by making a public announcement of such extension. There can be
no assurance that Purchaser will exercise its right to extend the Offer.
Purchaser also expressly reserves the right, subject to applicable law
(including applicable rules of the Commission) and to the terms of the Merger
Agreement, at any time or from time to time, (i) to delay acceptance for payment
of, or payment for, any Shares, regardless of whether the Shares were
theretofore accepted for payment, or to terminate the Offer and not accept for
payment or pay for any Shares not theretofore accepted for payment or paid for,
upon the occurrence of any of the conditions specified in Section 14, by giving
oral followed by written notice of such delay in payment or termination to the
Depositary, and (ii) to waive any conditions or otherwise amend the Offer in any
respect, by giving oral followed by written notice to the Depositary. Any
extension, delay in payment, termination or amendment will be followed as
promptly as practicable by public announcement, the announcement in the case of
an extension to be issued no later than 9:00 a.m., New York City time, on the
next business day after the previously scheduled Expiration Date. Without
limiting the manner in which Purchaser may choose to make any public
announcement, Purchaser will have no obligation to publish, advertise or
otherwise communicate any such announcement, other than by issuing a release to
the Dow Jones News Service or as otherwise may be required by law. The
reservation by Purchaser of the right to delay acceptance for payment of, or
payment for, Shares is subject to the provisions of Rule 14e-1(c) under the
Exchange Act, which requires that Purchaser pay the consideration offered or
return the Shares deposited by or on behalf of Stockholders promptly after the
termination or withdrawal of the Offer. Any delay in acceptance for payment or
payment beyond the time permitted by applicable law will be effectuated by an
extension of the period of time during which the Offer is open.
Pursuant to the terms of the Merger Agreement, without the prior written
consent of Company, Purchaser may not (and Parent will cause Purchaser not to)
(i) decrease or change the form of the Offer Consideration or decrease the
number of Shares sought pursuant to the Offer, (ii) amend any term of the Offer
in any manner adverse to holders of Shares, (iii) change the conditions to the
Offer, (iv) impose additional conditions to the Offer, (v) waive the Minimum
Share Condition, or (vi) extend the Expiration Date (except that Purchaser may,
without the consent of Company, (a) extend the Offer, if at the then scheduled
expiration date of the Offer any of the conditions to Purchaser's obligation to
purchase Shares is not satisfied, until such time as such condition is satisfied
or waived, and (b) extend the Offer for any period required by any rule,
regulation, interpretation or position of the Commission or the staff thereof);
PROVIDED, HOWEVER, that, except as set forth above and subject to applicable
legal requirements, Purchaser may amend the Offer or waive any condition to the
Offer in its sole discretion. Assuming the prior satisfaction or waiver of the
conditions to the Offer, Purchaser will accept for payment, and pay for, in
accordance with the terms of the Offer, all Shares validly tendered and not
withdrawn pursuant to the Offer as soon as practicable after the Expiration
Date.
The Commission has announced that, under its interpretation of Rules
14d-4(c) and 14d-6(d) under the Exchange Act, material changes in the terms of a
tender offer or information concerning a tender offer may require that the
tender offer be extended so that it remains open a sufficient period of time to
allow security holders to consider such material changes or information in
deciding whether or not to tender or withdraw their securities. The minimum
period during which an offer must remain open following material changes in the
terms of the offer or information concerning the offer, other than a change in
price or a change in percentage of securities sought, will depend upon the facts
and circumstances, including the relative materiality of the terms or
information. If Purchaser decides to increase or, subject to the consent of
Company, to decrease the consideration in the Offer, to make a change in the
percentage of Shares sought or to change or waive the Minimum Share Condition
and if, at the time that notice of any such change is first published, sent or
given to Stockholders, the Offer is scheduled to expire at any time earlier than
the tenth business day after (and including) the date of that notice, the Offer
will be extended at least until the expiration of that period of ten business
days.
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<PAGE>
Company has provided Purchaser with its stockholder list and security
position listings for the purpose of disseminating the Offer to the
Stockholders. This Offer to Purchase, the related Letter of Transmittal and
other relevant materials will be mailed to record holders of Shares and will be
furnished to brokers, dealers, commercial banks, trust companies and similar
persons whose names, or the names of whose nominees, appear on Company's
stockholder list or, if applicable, who are listed as participants in a clearing
agency's security position listing for subsequent transmittal to beneficial
owners of Shares.
2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any such extension or
amendment), Purchaser will accept for payment (and thereby purchase) and pay for
Shares that are validly tendered and not properly withdrawn prior to the
Expiration Date, as soon as practicable after the later of the following dates:
(i) the Expiration Date and (ii) the date of satisfaction or waiver of all the
conditions to the Offer set forth in this Offer to Purchase. Subject to the
applicable rules of the Commission and the terms of the Merger Agreement,
Purchaser expressly reserves the right to delay acceptance for payment of, or
payment for, Shares in order to comply, in whole or in part, with any other
applicable law, government regulation or condition contained therein. See
Sections 1 and 14.
In all cases, payment for Shares purchased pursuant to the Offer will be
made only after timely receipt by the Depositary of (i) certificates for the
Shares (or a timely Book-Entry Confirmation (as defined in Section 3) with
respect to the Shares), (ii) the Letter of Transmittal (or a manually signed
facsimile thereof), properly completed and duly executed with any required
signature guarantees (or, in the case of a book-entry transfer of Shares, an
Agent's Message (as defined below)), and (iii) all other documents required by
the Letter of Transmittal. See Section 3.
For purposes of the Offer, Purchaser will be deemed to have accepted for
payment (and thereby purchased) tendered Shares if, as and when Purchaser gives
oral followed by written notice to the Depositary of Purchaser's acceptance of
such Shares for payment. In all cases, payment for Shares purchased pursuant to
the Offer will be made by deposit of the purchase price with the Depositary,
which will act as agent for the tendering Stockholders for the purpose of
receiving payment from Purchaser and transmitting payment to the tendering
Stockholders whose Shares shall have been accepted for payment. If, for any
reason, acceptance for payment of any Shares tendered pursuant to the Offer is
delayed, or Purchaser is unable to accept for payment Shares tendered pursuant
to the Offer, then, without prejudice to Purchaser's rights under Section 14,
the Depositary may, nevertheless, on behalf of Purchaser, retain the tendered
Shares, and such Shares may not be withdrawn, except to the extent that the
tendering Stockholders are entitled to withdrawal rights as described in Section
4 and as otherwise required by Rule 14e-1(c) under the Exchange Act. Under no
circumstances will interest accrue on the consideration to be paid for the
Shares by Purchaser, regardless of any delay in making such payment.
If any tendered Shares are not purchased for any reason or if certificates
are submitted for more Shares than are tendered, certificates for the Shares not
purchased or tendered will be returned pursuant to the instructions of the
tendering Stockholder without expense to the tendering Stockholder (or, in the
case of Shares delivered by book-entry transfer into the Depositary's account at
a Book-Entry Transfer Facility pursuant to the procedures set forth in Section
3, the Shares will be credited to an account maintained at the appropriate
Book-Entry Transfer Facility) as promptly as practicable following the
expiration, termination or withdrawal of the Offer.
If, prior to the Expiration Date, Purchaser increases the consideration to
be paid per Share pursuant to the Offer, Purchaser will pay the increased
consideration for all of the Shares purchased pursuant to the Offer, whether or
not the Shares were tendered prior to the increase in consideration.
4
<PAGE>
3. PROCEDURE FOR TENDERING SHARES
VALID TENDERS. For Shares to be validly tendered pursuant to the Offer,
either (i) the Letter of Transmittal (or a manually signed facsimile thereof),
properly completed and duly executed with any required signature guarantees (or,
in the case of a book-entry transfer of Shares, an Agent's Message), and any
other documents required by the Letter of Transmittal, must be received by the
Depositary at one of its addresses set forth on the back cover of this Offer to
Purchase prior to the Expiration Date and either (a) certificates representing
tendered Shares must be received by the Depositary at any one of those addresses
prior to the Expiration Date or (b) the Shares must be delivered pursuant to the
procedures for book-entry transfer set forth below and a Book-Entry Confirmation
must be received by the Depositary prior to the Expiration Date or (ii) the
tendering Stockholder must comply with the guaranteed delivery procedures set
forth below. No alternative, conditional or contingent tenders will be accepted.
BOOK-ENTRY TRANSFER. The Depositary will establish an account with respect
to the Shares at The Depository Trust Company (the "Book-Entry Transfer
Facility") for purposes of the Offer within two business days after the date of
this Offer to Purchase. Any financial institution that is a participant in the
Book-Entry Transfer Facility system may make book-entry delivery of Shares by
causing the applicable Book-Entry Transfer Facility to transfer the Shares into
the Depositary's account at the Book-Entry Transfer Facility in accordance with
the Book-Entry Transfer Facility's procedures for such transfer. However,
although delivery of the Shares may be effected through book-entry transfer into
the Depositary's account at the Book-Entry Transfer Facility, the Letter of
Transmittal (or a manually signed facsimile thereof), properly completed and
duly executed with any required signature guarantees, or an Agent's Message, and
any other required documents must, in any case, be transmitted to, and received
by, the Depositary at one of its addresses set forth on the back cover of this
Offer to Purchase prior to the Expiration Date, or the tendering Stockholder
must comply with the guaranteed delivery procedures described below. The
confirmation of a book-entry transfer of Shares into the Depositary's account at
a Book-Entry Transfer Facility as described above is referred to as a
"Book-Entry Confirmation." The term "Agent's Message" means a message,
transmitted by a Book-Entry Transfer Facility to and received by the Depositary
and forming part of a Book-Entry Confirmation, which states that (i) such
Book-Entry Transfer Facility has received an express acknowledgment from the
participant in such Book-Entry Transfer Facility tendering the Shares that are
the subject of such Book-Entry Confirmation, (ii) such participant has received
and agrees to be bound by the terms of the Letter of Transmittal, and (iii)
Purchaser may enforce such agreement against such participant. DELIVERY OF THE
LETTER OF TRANSMITTAL OR OTHER DOCUMENTS TO A BOOK-ENTRY TRANSFER FACILITY DOES
NOT CONSTITUTE DELIVERY OF THE LETTER OF TRANSMITTAL OR SUCH OTHER DOCUMENTS TO
THE DEPOSITARY.
SIGNATURE GUARANTEES. No signature guarantee is required on the Letter of
Transmittal (i) if the Letter of Transmittal is signed by the registered holder
(which term, for purposes of this Section, includes any participant in the
Book-Entry Transfer Facility system whose name appears on a security position
listing as the owner of the Shares) of Shares tendered therewith and such
registered holder has not completed the box entitled "Special Payment
Instructions" on the Letter of Transmittal or (ii) if such Shares are tendered
for the account of a financial institution (including most commercial banks,
savings and loans associations and brokerage houses) that is a participant in
the Security Transfer Agents Medallion Program (an "Eligible Institution"). In
all other cases, all signatures on the Letter of Transmittal must be guaranteed
by an Eligible Institution. See Instruction 1 of the Letter of Transmittal. If
the certificates representing Shares are registered in the name of a person
other than the signer of the Letter of Transmittal or if payment is to be made
or if certificates for Shares not tendered or not accepted for payment are to be
returned to a person other than the registered holder of the certificates
surrendered, then the tendered certificates representing Shares must be endorsed
or accompanied by appropriate stock powers, in each case signed exactly as the
name or names of the registered holder or owners appears on the certificates,
with the signatures on the certificates or stock powers guaranteed by an
5
<PAGE>
Eligible Institution as described above and as provided in the Letter of
Transmittal. See Instructions 1 and 5 of the Letter of Transmittal.
GUARANTEED DELIVERY. If a Stockholder wishes to tender Shares pursuant to
the Offer and the Stockholder's certificates are not immediately available or
the procedures for book-entry transfer cannot be completed on a timely basis or
time will not permit all required documents to be received by the Depositary
prior to the Expiration Date, the Shares may nevertheless be tendered if all the
following guaranteed delivery procedures are complied with:
(i) the tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed Delivery,
substantially in the form provided by Purchaser with this Offer to
Purchase, is received by the Depositary as provided below prior to the
Expiration Date; and
(iii) the certificates for all tendered Shares in proper form for transfer
or a Book-Entry Confirmation with respect to all tendered Shares,
together with a properly completed and duly executed Letter of
Transmittal (or a manually signed facsimile thereof) and any required
signature guarantees (or, in the case of a book-entry transfer of
Shares, an Agent's Message), and any other documents required by the
Letter of Transmittal, are received by the Depositary within three New
York Stock Exchange ("NYSE") trading days after the date of execution
of the Notice of Guaranteed Delivery.
THE NOTICE OF GUARANTEED DELIVERY MAY BE DELIVERED BY HAND OR TRANSMITTED BY
FACSIMILE TRANSMISSION OR MAILED TO THE DEPOSITARY AND MUST INCLUDE AN
ENDORSEMENT BY AN ELIGIBLE INSTITUTION IN THE FORM SET FORTH IN THE NOTICE OF
GUARANTEED DELIVERY.
IN ALL CASES, SHARES SHALL NOT BE DEEMED VALIDLY TENDERED UNLESS A PROPERLY
COMPLETED AND DULY EXECUTED LETTER OF TRANSMITTAL (OR A MANUALLY SIGNED
FACSIMILE THEREOF) OR, IN THE CASE OF A BOOK-ENTRY TRANSFER OF SHARES, AN
AGENT'S MESSAGE, IS RECEIVED BY THE DEPOSITARY AT ONE OF ITS ADDRESSES SET FORTH
ON THE BACK COVER OF THIS OFFER TO PURCHASE PRIOR TO THE EXPIRATION DATE.
THE METHOD OF DELIVERY OF CERTIFICATES FOR SHARES, THE LETTER OF TRANSMITTAL
AND ANY OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND SOLE RISK OF THE TENDERING
STOCKHOLDER AND DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY THE
DEPOSITARY. IF DELIVERY IS MADE BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME
SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
Notwithstanding any other provision of this Offer to Purchase, payment for
Shares accepted for payment pursuant to the Offer in all cases will be made only
after timely receipt by the Depositary of certificates for (or Book-Entry
Confirmation with respect to) the Shares, a Letter of Transmittal (or a manually
signed facsimile thereof), properly completed and duly executed with any
required signature guarantees (or, in the case of a book-entry transfer, an
Agent's Message), and all other documents required by the Letter of Transmittal.
BACKUP FEDERAL INCOME TAX WITHHOLDING. To prevent backup federal income tax
withholding of 31% of the payments made to Stockholders with respect to the
purchase price of Shares purchased pursuant to the Offer or the Merger, a
Stockholder must provide the Depositary with its correct taxpayer identification
number and certify that it is not subject to backup federal income tax
withholding by completing the substitute Form W-9 included in the Letter of
Transmittal. See Instruction 10 of the Letter of Transmittal. See Section 5
below.
DETERMINATION OF VALIDITY. All questions as to the form of documents and
the validity, eligibility (including time of receipt) and acceptance for payment
of any tender of Shares pursuant to any of the procedures described above will
be determined by Purchaser in its sole discretion, which determination
6
<PAGE>
will be final and binding on all parties. Purchaser reserves the absolute right
to reject any or all tenders of Shares determined not to be in proper form or
the acceptance of or payment for which may, in the opinion of counsel, be
unlawful and reserves the absolute right to waive any defect or irregularity in
any tender of Shares. Subject to the terms of the Merger Agreement, Purchaser
also reserves the absolute right to waive or amend any or all of the conditions
of the Offer. Purchaser's interpretation of the terms and conditions of the
Offer (including the Letters of Transmittal and the instructions thereto) will
be final and binding on all parties. No tender of Shares will be deemed to have
been validly made until all defects and irregularities have been cured or
waived. None of Purchaser, Parent, the Dealer Managers, the Information Agent or
any other person will be under any duty to give notification of any defects or
irregularities in tenders or incur any liability for failure to give any such
notification.
APPOINTMENT AS PROXY. By executing a Letter of Transmittal, a tendering
Stockholder irrevocably appoints designees of Purchaser as his attorneys-in-fact
and proxies, with full power of substitution and resubstitution, in the manner
set forth in the Letter of Transmittal, to the full extent of the Stockholder's
rights with respect to the Shares tendered by the Stockholder and purchased by
Purchaser and with respect to any and all other Shares or other securities
issued or issuable in respect of those Shares, on or after the date of the
Offer. All such powers of attorney and proxies will be considered coupled with
an interest in the tendered Shares. Such appointment will be effective when, and
only to the extent that, Purchaser accepts the Shares for payment. Upon
acceptance for payment, all prior powers of attorney and proxies given by the
Stockholder with respect to the Shares (and any other Shares or other securities
so issued in respect of such purchased Shares) will be revoked, without further
action, and no subsequent powers of attorney and proxies may be given (and, if
given, will not be deemed effective) by the Stockholder. The designees of
Purchaser will be empowered to exercise all voting and other rights of the
Stockholder with respect to such Shares (and any other Shares or securities so
issued in respect of such purchased Shares) as they in their sole discretion may
deem proper, including without limitation in respect of any annual or special
meeting of the Stockholders, or any adjournment or postponement of any such
meeting.
Purchaser reserves the absolute right to require that, in order for Shares
to be validly tendered, immediately upon Purchaser's acceptance for payment of
the Shares, Purchaser must be able to exercise full voting and other rights with
respect to the Shares, including voting at any meeting of Stockholders then
scheduled.
4. WITHDRAWAL RIGHTS
Tenders of Shares made pursuant to the Offer are irrevocable, except as
otherwise provided in this Section 4. Shares tendered pursuant to the Offer may
be withdrawn at any time prior to the Expiration Date and, unless theretofore
accepted for payment by Purchaser as provided in this Offer to Purchase, may
also be withdrawn at any time after March 25, 1999. If Purchaser extends the
Offer, is delayed in its purchase of or payment for Shares, or is unable to
purchase or pay for Shares for any reason, then without prejudice to the rights
of Purchaser, tendered Shares may be retained by the Depositary on behalf of
Purchaser and may not be withdrawn, except to the extent that tendering
Stockholders are entitled to withdrawal rights as set forth in this Section 4.
The reservation by Purchaser of the right to delay the acceptance or
purchase of or payment for Shares is subject to the terms of the Merger
Agreement and the provisions of Rule 14e-1(c) under the Exchange Act, which
requires Purchaser to pay the consideration offered or to return Shares
deposited by or on behalf of Stockholders promptly after the termination or
withdrawal of the Offer.
For a withdrawal to be effective, a written or facsimile transmission notice
of withdrawal must be timely received by the Depositary at one of its addresses
set forth on the back cover of this Offer to Purchase. Any such notice of
withdrawal must specify the name of the persons who tendered the Shares to be
withdrawn, the number of Shares to be withdrawn and the name of the registered
holder, if different
7
<PAGE>
from that of the person who tendered the Shares. If certificates evidencing
Shares have been delivered or otherwise identified to the Depositary then, prior
to the release of the certificates, the tendering Stockholder must also submit
the serial numbers shown on the particular certificates evidencing the Shares to
be withdrawn, and the signature on the notice of withdrawal must be guaranteed
by an Eligible Institution (except in the case of Shares tendered for the
account of an Eligible Institution). If Shares have been tendered pursuant to
the procedure for book-entry transfer set forth in Section 3, the notice of
withdrawal must specify the name and number of the account at the applicable
Book-Entry Transfer Facility to be credited with the withdrawn Shares. All
questions as to the form and validity (including time of receipt) of notices of
withdrawal will be determined by Purchaser, in its sole discretion, which
determination shall be final and binding on all parties. No withdrawal of Shares
will be deemed to have been made properly until all defects and irregularities
have been cured or waived. None of Parent, Purchaser, the Dealer Managers, the
Depositary, the Information Agent or any other person will be under any duty to
give notification of any defects or irregularities in any notice of withdrawal
or incur any liability for failing to give such notification.
Any Shares properly withdrawn will be deemed not validly tendered for
purposes of the Offer, but may be tendered at any subsequent time prior to the
Expiration Date by following any of the procedures described in Section 3 above.
5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES OF THE OFFER AND THE MERGER
The following is a summary of the material federal income tax consequences
of the Offer and the Merger to holders whose Shares are purchased pursuant to
the Offer or whose Shares are converted into the right to receive the Merger
Consideration in the Merger (including any cash amounts received by dissenting
Stockholders pursuant to the exercise of appraisal rights). This discussion is
based upon the provisions of the Internal Revenue Code of 1986, as amended (the
"Code"), the applicable Treasury Regulations promulgated and proposed thereunder
and published judicial authority and administrative rulings and practice.
Legislative, judicial or administrative authorities or interpretations are
subject to change, possibly on a retroactive basis, at any time and a change
could alter or modify the statements and conclusions set forth below. It is
assumed for purposes of this discussion that the Shares are held as "capital
assets" within the meaning of Section 1221 of the Code. This discussion does not
address all aspects of federal income taxation that may be relevant to a
particular Stockholder in light of such Stockholder's personal investment
circumstances, or those Stockholders subject to special treatment under the
federal income tax laws (for example, life insurance companies, tax-exempt
organizations, foreign corporations and nonresident alien individuals) or to
Stockholders who acquired their Shares through the exercise of employee stock
options or other compensation arrangements. In addition, the discussion does not
address any aspect of foreign, state or local income taxation or any other form
of taxation that may be applicable to a Stockholder.
CONSEQUENCES OF THE OFFER AND THE MERGER TO STOCKHOLDERS. The receipt of
the Offer Consideration and the Merger Consideration (and any cash amounts
received by dissenting Stockholders pursuant to the exercise of appraisal
rights) will be a taxable transaction for federal income tax purposes (and also
may be a taxable transaction under applicable state, local and other income tax
laws). In general, for federal income tax purposes, a Stockholder will recognize
gain or loss equal to the difference between its adjusted tax basis in the
Shares sold pursuant to the Offer or converted to cash in the Merger or pursuant
to the exercise of appraisal rights and the amount of cash received therefor.
Such gain or loss will be capital gain or loss and will be long-term gain or
loss, if, on the date of sale (or, if applicable, the date of the Merger) the
Shares were held for more than one year.
BACKUP TAX WITHHOLDING. Under the Code, a Stockholder may be subject, under
certain circumstances, to "backup withholding" at a 31% rate with respect to
payments made in connection with the Offer or the Merger. Backup withholding
generally applies if the Stockholder (i) fails to furnish his social security
number or other taxpayer identification number ("TIN"), (ii) furnishes an
incorrect TIN, (iii) fails
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properly to report interest or dividends, or (iv) under certain circumstances,
fails to provide a certified statement, signed under penalties of perjury, that
the TIN provided is his correct number and that he or she is not subject to
backup withholding. Backup withholding is not an additional tax but merely an
advance payment, which may be refunded to the extent it results in an
overpayment of tax. Certain persons generally are exempt from backup
withholding, including corporations and financial institutions. Certain
penalties apply for failure to furnish correct information and for failure to
include the reportable payments in income. Each Stockholder should consult with
its own tax advisor as to its qualifications for exemption from withholding and
the procedure for obtaining such exemption.
THE FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL
INFORMATION PURPOSES ONLY. STOCKHOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS TO
DETERMINE THE FEDERAL, STATE, LOCAL AND FOREIGN TAX CONSEQUENCES OF THE OFFER
AND THE MERGER TO THEM IN VIEW OF THEIR OWN PARTICULAR CIRCUMSTANCES.
6. PRICE RANGE OF THE SHARES; DIVIDENDS ON THE SHARES
According to Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1997 (the "Company 10-K") and Quarterly Report on Form 10-Q for the
quarterly period ended September 30, 1998 (the "Company 10-Q") and information
supplied to Purchaser by Company, the principal trading market for the Shares is
the Nasdaq Stock Market, Inc.'s National Market (the "NASDAQ") and the Shares
are admitted for quotation and traded on the NASDAQ under the symbol "ABTC." The
following table sets forth, for the periods indicated, the high and low sale
prices per Share reported by NASDAQ Composite Reporting System. Company has not
paid any dividends on the Shares during the periods specified below.
<TABLE>
<CAPTION>
HIGH LOW
------- -------
<S> <C> <C>
1996
First Quarter.............................. $19 1/2 $14 1/4
Second Quarter............................. 23 18 1/2
Third Quarter.............................. 22 1/2 19 1/2
Fourth Quarter............................. 26 3/4 19 3/4
1997
First Quarter.............................. $27 1/4 $21
Second Quarter............................. 26 3/4 21 1/4
Third Quarter.............................. 26 1/2 16 3/4
Fourth Quarter............................. 20 5/8 16 1/2
1998
First Quarter.............................. $18 5/8 $14
Second Quarter............................. 17 1/2 12 1/2
Third Quarter.............................. 17 1/8 8
Fourth Quarter............................. 11 1/2 6 3/4
</TABLE>
On January 15, 1999, the last full trading day before the public
announcement of the Merger Agreement, the last reported sale price on the NASDAQ
was $14 1/8 per Share. On January 22, 1999, the last full trading day before the
commencement of the Offer, the last reported sale price on the NASDAQ was
$14 3/4 per Share. STOCKHOLDERS ARE URGED TO OBTAIN CURRENT MARKET QUOTATIONS
FOR THE SHARES.
7. EFFECT OF THE OFFER ON THE MARKET FOR SHARES, NASDAQ QUOTATION AND EXCHANGE
ACT REGISTRATION AND MARGIN SECURITIES.
The purchase of Shares pursuant to the Offer will reduce the number of
Shares that might otherwise trade publicly and may reduce the number of holders
of Shares, which could adversely affect the
9
<PAGE>
liquidity and market value of the remaining Shares held by Stockholders other
than Purchaser. Purchaser cannot predict whether the reduction in the number of
Shares that might otherwise trade publicly would have an adverse or beneficial
effect on the market price for, or marketability of, the Shares or whether such
reduction would cause future market prices to be greater or less than the Offer
Consideration.
Depending upon the number of Shares purchased pursuant to the Offer, the
Shares may no longer meet the standards for continued inclusion on the NASDAQ
and may, therefore, no longer be included on the NASDAQ. According to the
NASDAQ's published guidelines, the NASDAQ would consider no longer including the
Shares for quotation and trading if, among other things, the number of publicly
held Shares were less than 5,000,000, there were less than 300 round lot holders
(as defined in Section 4200(a)(30) of the NASD Manual--The NASDAQ Stock Market)
of the Shares, or the aggregate market capitalization of the Company were less
than $35.0 million. If, as a result of the purchase of Shares pursuant to the
Offer, the Shares no longer meet the requirements of the NASDAQ for continued
quotation and trading and the quotation and trading of Shares is discontinued,
the market for the Shares could be adversely affected.
Company has advised Purchaser that, as of January 14, 1999, there were
10,674,160 Shares issued and outstanding. If the Shares were no longer quoted on
the NASDAQ (which Purchaser intends to cause the Company to seek if it acquires
control of the Company and the Shares no longer meet the standards for
inclusion), it is possible that the Shares would trade in the over-the-counter
market or otherwise and that price quotations for the Shares would be reported.
The extent of the public market for the Shares and availability of such
quotations would, however, depend upon such factors as the number of holders
and/or the aggregate market value of the publicly-held Shares at such time, the
interest in maintaining a market in the Shares on the part of securities firms,
the possible termination of registration of the Shares under the Exchange Act
and other factors.
The Shares are currently registered under Section 12(g) of the Exchange Act.
Such registration may be terminated upon application of Company to the
Commission if the Shares are neither listed on a national securities exchange
nor held by 300 or more holders of record. Termination of the registration of
the Shares under the Exchange Act would substantially reduce the information
required to be furnished by Company to holders of Shares and to the Commission
and would make certain of the provisions of the Exchange Act, such as the
short-swing profit recovery provisions of Section 16(b), the requirement of
furnishing a proxy statement pursuant to Section 14(a) in connection with a
stockholders' meeting and the related requirement of an annual report to
stockholders and the requirements of Rule 13e-3 under the Exchange Act with
respect to "going private" transactions, no longer applicable to the Shares.
Furthermore, "affiliates" of Company and persons holding "restricted securities"
of Company may be deprived of the ability to dispose of such securities pursuant
to Rule 144 promulgated under the Securities Act of 1933 (the "Securities Act").
If registration of the Shares under the Exchange Act were terminated, the Shares
would no longer be "margin securities," or eligible for listing on a securities
exchange or quotation and trading on the NASDAQ. Purchaser intends to seek to
cause Company to terminate registration of the Shares under the Exchange Act as
soon after consummation of the Offer as the requirements for termination of
registration of the Shares are met.
The Shares are currently "margin securities" under the regulations of the
Board of Governors of the Federal Reserve System (the "Federal Reserve Board"),
which has the effect, among other things, of allowing brokers to extend credit
on the collateral of the Shares. Depending upon factors similar to those
described above regarding listing and market quotations, the Shares might no
longer constitute "margin securities" for the purposes of the Federal Reserve
Board's margin regulations and, therefore, could no longer be used as collateral
for loans made by brokers.
10
<PAGE>
8. CERTAIN INFORMATION CONCERNING COMPANY
GENERAL INFORMATION. Company is a Delaware corporation with its principal
executive offices located at One Neenah Center, Neenah, Wisconsin 54956.
According to the Company 10-K, Company is the largest manufacturer of exterior
hardboard siding in the United States and a leading manufacturer of plastic
resin specialty building products.
According to a Current Report on Form 8-K filed by Company with the
Commission on December 24, 1998, Company has entered into a definitive agreement
to sell its fiber cement plant in Roaring River, North Carolina to CertainTeed
Corporation for an aggregate purchase price of approximately $48 to $50 million.
According to Company, the sale is expected to close in late January 1999 or
early February 1999. The closing of the sale is subject to satisfaction of
customary conditions.
HISTORICAL FINANCIAL INFORMATION. Set forth below is certain selected
consolidated financial information with respect to Company which has been
excerpted from the Company 10-K and the Company 10-Q. More comprehensive
financial information is included in such reports and other documents filed by
Company with the Commission, and the following summary is qualified in its
entirety by reference to such reports and other documents and all of the
financial information (including any related notes) contained therein. Such
reports and other documents should be available for inspection and copies should
be obtainable in the manner set forth below under "Available Information."
11
<PAGE>
ABT BUILDING PRODUCTS CORPORATION
SELECTED CONSOLIDATED FINANCIAL DATA
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
NINE MONTHS
ENDED SEPTEMBER 30,
YEARS ENDED DECEMBER 31,
-------------------------------------------------------- --------------------
1993 1994 1995 1996 1997 (3) 1997 1998
------------ --------- --------- --------- --------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
(IN THOUSANDS, EXCEPT PER SHARE INFORMATION)
OPERATING DATA:
Net Sales............................ $ 161,011 $ 203,264 $ 240,107 $ 320,402 $ 321,813 $ 252,935 $ 258,545
Cost of sales........................ 106,572 139,848 176,119 227,351 225,074 176,718 189,863
------------ --------- --------- --------- --------- --------- ---------
Gross Profit......................... 54,439 63,416 63,988 93,051 96,739 76,217 68,682
Selling, general and administrative
expenses........................... 21,253 25,684 30,961 48,609 53,250 39,650 39,911
Restructuring charge(1).............. -- -- -- -- 10,397 10,397 --
------------ --------- --------- --------- --------- --------- ---------
Operating income..................... 33,186 37,732 33,027 44,442 33,092 26,170 28,771
Interest expense..................... 3,929 2,063 5,929 6,511 8,344 -- --
Other income (expense), net.......... (201) (80) (4) (269) (263) (5,811) (7,482)
------------ --------- --------- --------- --------- --------- ---------
Income before income taxes and
extraordinary item................. 29,056 35,589 27,094 37,662 25,011 20,359 21,289
Provision for income taxes........... 11,572 13,843 10,607 14,510 9,521 7,801 8,091
------------ --------- --------- --------- --------- --------- ---------
Net income before extraordinary
item............................... 17,484 21,746 16,487 23,152 15,490 12,558 13,198
Extraordinary item (net of tax)(2)... (1,070) -- -- -- -- -- --
------------ --------- --------- --------- --------- --------- ---------
Net income........................... $ 16,414 $ 21,746 $ 16,487 $ 23,152 $ 15,490 $ 12,558 $ 13,198
------------ --------- --------- --------- --------- --------- ---------
------------ --------- --------- --------- --------- --------- ---------
PER COMMON SHARE DATA (3):
Income before extraordinary item:
Basic.............................. $ 1.65 $ 1.85 $ 1.54 $ 2.22 $ 1.47 $ 1.19 $ 1.24
Diluted............................ $ 1.50 $ 1.70 $ 1.42 $ 2.01 $ 1.34 $ 1.08 $ 1.16
Income after extraordinary item:
Basic.............................. $ 1.55 $ 1.85 $ 1.54 $ 2.22 $ 1.47 $ 1.19 $ 1.24
Diluted............................ $ 1.41 $ 1.70 $ 1.42 $ 2.01 $ 1.34 $ 1.08 $ 1.16
BALANCE SHEET DATA:
Working capital...................... $ 27,363 $ 42,006 $ 55,762 $ 42,777 $ 55,683 $ 62,181 $ 66,722
Total assets......................... 109,628 143,545 210,767 260,264 309,232 313,871 323,042
Total debt........................... 12,438 33,278 84,629 100,071 132,911 136,440 122,216
Stockholders' equity................. 77,210 80,483 88,120 109,941 124,841 121,363 137,042
</TABLE>
- ------------------------------
(1) Company recorded a $10.4 million charge (consisting of a $1.5 million cash
charge and a $8.9 million non-cash charge) during the second quarter of 1997
in connection with the restructuring of its exterior plastics products
group. The restructuring charge consisted of: the write-down of certain
machinery and equipment, $5.8 million; the write-down of inventory and
goodwill to net realizable values, $3.1 million; and severance payments and
lease obligations related to the closing of certain leased facilities, $1.5
million.
(2) For 1993, represents the write-off of deferred financing costs in connection
with the repayment of long-term debt with the proceeds of Company's initial
public offering.
(3) Gives effect to Company's stock split effected in June 1993 in connection
with Company's initial public offering.
On January 22, 1999, Company issued a press release in which it disclosed
the results of operations data for the three months and year ended December 31,
1998 set forth below. Such data should be read in conjunction with the reports
and other documents filed by Company with the Commission, including the
financial information (and any related notes) contained therein. Such reports
and other documents should be available for inspection and copies should be
obtainable in the manner set forth below under "Available Information."
12
<PAGE>
ABT BUILDING PRODUCTS CORPORATION
SELECTED CONSOLIDATED FINANCIAL DATA
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
THREE MONTHS YEAR
ENDED DECEMBER 31, ENDED DECEMBER 31,
-------------------- ------------------------
1998 1997 1998 1997
--------- --------- ----------- -----------
<S> <C> <C> <C> <C>
OPERATING DATA:
Net Sales............................................... $ 68,790 $ 67,399 $ 317,304 $ 316,984
Income From Continuing Operations....................... $ 1,687 $ 3,799 $ 17,154 $ 16,491
Discontinued Operations:
Loss from operations of discontinued business, net of
income tax benefit.................................. (2,463) (867) (4,732) (1,001)
Loss on disposal of discontinued business, net of
income tax benefit.................................. (11,656) -- (11,656) --
Net Income.............................................. (12,432) 2,932 766 15,490
PER COMMON SHARE DATA:
Income Per Common Share
From Continuing Operations
Basic............................................... 0.16 0.36 1.61 1.56
Diluted............................................. 0.15 0.33 1.51 1.42
From Operations of Discontinued Business
Basic............................................... (0.23) (0.08) (0.44) (0.09)
From Disposal of Discontinued Business Basic.......... (1.09) -- (1.09) --
Net Income Per Share
Basic............................................... (1.16) 0.28 0.07 1.47
Diluted............................................. -- 0.26 0.07 1.34
Weighted Average Common Share Outstanding
Basic............................................... 10,674 10,586 10,660 10,547
Diluted............................................. 11,314 11,448 11,369 11,578
</TABLE>
CERTAIN COMPANY PROJECTIONS. During the course of discussions among Parent,
Purchaser and Company that led to the execution of the Merger Agreement (see
Section 11 below), Company provided Purchaser and Parent with certain business
and financial information which was not publicly available. Such information
included, among other things, forecasted results of operations for Company's
fiscal year ending December 31, 1999 prepared by the management of Company on
December 8, 1998 (the "Company Forecasts"). The Company Forecasts do not take
into account any of the potential effects of the Merger.
The information from the Company Forecasts summarized below is included in
this Offer to Purchase solely because such information was provided to Parent in
connection with its evaluation of the Company. As a matter of course, Company
does not make public projections or forecasts of its anticipated financial
position or results of operations. Accordingly, neither Parent nor Company
anticipates that it will, and each of Parent and Company disclaims any
obligation to, furnish updated forecasts or projections to any person, cause
such information to be included in documents required to be filed with the
Commission or otherwise make such information public (irrespective in any such
case of whether the Company Forecasts, in light of events or developments
occurring after the time at which they were originally prepared, shall have
ceased to have a reasonable basis).
The inclusion herein of the information from the Company Forecasts
summarized below should not be regarded as an indication that either Parent or
Company considers such information to be an
13
<PAGE>
accurate prediction of future events. While presented with numerical
specificity, the information from the Company Forecasts summarized below is
based upon a variety of assumptions, including (i) assumptions relating to
general economic conditions and the business of Company, (ii) the assumed
receipt on December 31, 1998 of $50.0 million of proceeds from the sale of
Company's fiber cement plant in Roaring River, North Carolina, and (iii) the
application of $40.0 million of such proceeds to reduce Company's outstanding
bank borrowings. Such assumptions are subject to significant uncertainties and
contingencies, many of which are beyond the control of Company.
The Company Forecasts were not prepared with a view to public disclosure or
compliance with published guidelines of the Commission or the guidelines
established by the American Institute of Certified Public Accountants.
The information from the Company Forecasts should be evaluated in
conjunction with the historical financial statements and other information
regarding Company contained elsewhere in this Offer to Purchase, the Company
10-K and the Company 10-Q. In light of the foregoing factors and the
uncertainties inherent in the Company Forecasts, holders of Shares are cautioned
not to place undue reliance thereon. A summary of the Company Forecasts is set
forth below.
1999 ANNUAL OPERATING PLAN
KEY SUMMARY DATA
(In thousands, except per share amounts)
<TABLE>
<CAPTION>
FISCAL YEAR
1999
-----------
<S> <C>
Gross Sales...................................................................... $ 353,296
Net Sales........................................................................ 317,544
Operating Income (EBIT).......................................................... 35,426
Net Income....................................................................... 18,715
Earnings Per Share- -Diluted..................................................... $ 1.64
</TABLE>
AVAILABLE INFORMATION. Company is subject to the informational filing
requirements of the Exchange Act. In accordance with the Exchange Act, Company
files periodic reports, proxy statements and other information with the
Commission relating to its business, financial condition and other matters.
Company is required to disclose in such proxy statements certain information, as
of particular dates, concerning Company's directors and officers, their
remuneration, stock options granted to them, the principal holders of Company's
securities and any material interest of those persons in transactions with
Company. Such reports, proxy statements and other information may be inspected
at the Commission's office at 450 Fifth Street, N.W., Washington, D.C. 20549,
and also should be available for inspection and copying at the regional offices
of the Commission located at Citicorp Center, 500 West Madison Street, Suite
1400, Chicago, Illinois 60661; and 7 World Trade Center, Suite 1300, New York,
New York 10048. Copies may be obtained upon payment of the Commission's
prescribed fees by writing to its principal office at 450 Fifth Street, N.W.,
Washington, D.C. 20549, or through the Commission's Website
(http://www.sec.gov).
Except as otherwise stated in this Offer to Purchase, the information
concerning Company contained in this Offer to Purchase has been taken from or is
based upon publicly available documents on file with the Commission and other
publicly available information. Although Purchaser and Parent do not have any
knowledge that any such information is untrue in any material respect, neither
Purchaser nor Parent takes any responsibility for the accuracy or completeness
of such information or for any failure by Company to disclose events that may
have occurred and may affect the significance or accuracy of any such
information.
14
<PAGE>
9. CERTAIN INFORMATION CONCERNING PURCHASER AND PARENT
Purchaser, a Delaware corporation, was organized to acquire all of the
Shares pursuant to the Offer and the Merger and has not conducted any unrelated
activities since its organization. All of the outstanding capital stock of
Purchaser is owned directly by Parent. The principal executive offices of
Purchaser are located at 111 S.W. Fifth Avenue, Portland, Oregon 97204.
Parent is a Delaware corporation, with its principal executive offices
located at 111 S.W. Fifth Avenue, Portland, Oregon 97204. Parent is a major
building products supply firm manufacturing structural panels, including
oriented strand board and plywood and other panel products, lumber, hardwood
veneers, cellulose insulation and specialty building products.
Set forth below is certain selected consolidated financial information with
respect to Parent which has been partially excerpted from Parent's Annual Report
on Form 10-K for the fiscal year ended December 31, 1997 (the "Parent 10-K") and
Parent's Quarterly Report on Form 10-Q for the fiscal quarter ended September
30, 1998 (the "Parent 10-Q"). More comprehensive financial information is
included in such reports and other documents filed by Parent with the
Commission, and the following summary is qualified in its entirety by reference
to such reports and other documents and all the financial information (including
any related notes) contained therein. The Parent 10-K and the Parent 10-Q are
incorporated herein by reference. Such reports and other documents should be
available for inspection and copies should be obtainable from the offices of the
Commission in the same manner as set forth under "Available Information" in
Section 8 above.
15
<PAGE>
LOUISIANA-PACIFIC CORPORATION
SELECTED CONSOLIDATED FINANCIAL DATA
(In millions, except per share amounts)
<TABLE>
<CAPTION>
NINE MONTHS
YEARS ENDED ENDED SEPTEMBER 30,
DECEMBER 31,
------------------------------------------------------------- --------------------
1993 1994 1995(4) 1996 (4) 1997 (4) 1997 1998
------------- --------- --------- ----------- ----------- --------- ---------
<S> <C> <C> <C> <C> <C> <C> <C>
(IN THOUSANDS, EXCEPT PER SHARE INFORMATION)
OPERATING DATA (2):
Net sales................................... $ 2,511.3 $ 3,039.5 $ 2,843.2 $ 2,486.0 $ 2,402.5 $ 1,807.4 $ 1,777.8
Gross profit (loss) (1)..................... 423.6 558.6 268.9 31.0 (88.5) (57.1) 71.4
Interest, net............................... 5.0 1.0 2.9 (7.8) (29) (23.3) (15.3)
Provision (benefit) for income taxes........ 173.2 209.8 (45.8) (125.6) (43.6) (28.7) 9.3
Income (loss) (3)........................... 254.4 346.9 (51.7) (200.7) (101.8) (80.5) (13.9)
PER COMMON SHARE DATA:
Income (loss) per share (3)
Basic....................................... $ 2.32 $ 3.15 $ (0.48) $ (1.87) $ (0.94) (0.78) (0.13)
Diluted..................................... 2.29 3.13 (0.48) (1.87) (0.94) (0.74) (0.13)
Cash dividends per share.................... 0.43 0.485 0.545 0.56 0.56 0.42 0.42
BALANCE SHEET DATA:
Current assets.............................. $ 614.1 $ 721.9 $ 618.5 $ 612.9 $ 596.8 $ 556.6 $ 759.8
Timber and timberlands, at cost less cost of
timber harvested.......................... 673.5 693.5 689.6 648.6 634.2 637.1 909.3
Property, plant and equipment, net.......... 1,145.9 1,273.2 1,452.3 1,278.5 1,191.8 1,239.1 934.0
Goodwill and other assets................... 32.8 55.1 45.0 82.4 155.6 155.6 103.6
------------- --------- --------- ----------- ----------- --------- ---------
Total assets................................ $ 2,466.3 $ 2,743.7 $ 2,805.4 $ 2,622.4 $ 2,578.4 $ 2,588.4 2,706.7
------------- --------- --------- ----------- ----------- --------- ---------
------------- --------- --------- ----------- ----------- --------- ---------
Current liabilities......................... 317.2 344.8 448.5 378.4 319.3 366.6 496.7
Long-term debt, excluding current portion... 288.6 209.8 201.3 458.6 572.3 508.5 475.3
Deferred income taxes and other............. 289.1 339.7 499.6 357.8 400.6 360.2 481.5
Stockholders' equity........................ 1,571.4 1,849.4 1656.0 1,427.6 1,286.2 1,328.5 1253.2
------------- --------- --------- ----------- ----------- --------- ---------
Total liabilities and stockholders'
equity.................................... $ 2,466.3 $ 2,743.7 $ 2,805.4 $ 2,622.4 $ 2,578.4 $ 2,588.4 $ 2,706.7
------------- --------- --------- ----------- ----------- --------- ---------
------------- --------- --------- ----------- ----------- --------- ---------
</TABLE>
- ------------------------------
(1) Gross profit is income before settlements, charges and unusual items, income
taxes, minority interest, and interest.
(2) All per share amounts and number of shares have been retroactively adjusted
for a two-for-one stock split in 1993.
(3) Does not include cumulative effects of accounting changes in 1993.
(4) Includes settlements, charges and other unusual items, net. See the Notes to
Financial Statements in Item 8 of the Parent 10-K.
Except as set forth in this Offer to Purchase, none of Parent, Purchaser or
any of their respective subsidiaries (collectively, the "Purchaser Entities"),
or, to the knowledge of any of the Purchaser Entities, any of the persons listed
in Schedule I, has any contract, arrangement, understanding or relationship
(whether or not legally enforceable) with any other person with respect to any
securities of Company, including, but not limited to, any contract, arrangement,
understanding or relationship concerning the transfer or the voting of any
securities of Company, joint ventures, loan or option arrangements, puts or
calls, guarantees of loans, guarantees against loss or the giving or withholding
of proxies. Except as set forth in this Offer to Purchase, none of the Purchaser
Entities, or, to the knowledge of any of the Purchaser Entities, any of the
persons listed in Schedule I, has had, since January 1, 1996, any transactions
with Company or any of its affiliates that would be required to be disclosed in
the Schedule 14D-1. Except as set forth in this Offer to Purchase, since January
1, 1996, there have been no contacts, negotiations or transactions between the
Purchaser Entities or, to the knowledge of any of the Purchaser Entities, any of
the persons listed in Schedule I, and Company or its affiliates concerning a
merger, consolidation or acquisition, a tender offer or other acquisition of
securities, an election of directors or a sale or other transfer of a material
amount of assets. Except as set forth in this Offer to Purchase, none of the
Purchaser Entities or, to the knowledge of any of the Purchaser Entities, any of
the persons listed in Schedule 1, beneficially owns any Shares or has effected
any transactions in the Shares in the past 60 days.
16
<PAGE>
10. SOURCE AND AMOUNT OF FUNDS
SOURCE AND AMOUNT OF FUNDS. The aggregate amount of funds required by
Purchaser to pay the aggregate purchase price to be paid pursuant to the Offer
and the Merger is estimated to be approximately $179.0 million. Such amount
assumes the purchase pursuant to the Offer of all Shares underlying options that
were outstanding as of January 14, 1999 and that have exercise prices less than
$15.00 per Share.
The funds required by Purchaser to pay the aggregate purchase price to be
paid pursuant to the Offer and the Merger are expected to be provided to
Purchaser in the form of capital contributions or advances made by Parent.
Parent plans to obtain the funds for such capital contributions or advances from
its available cash, borrowings under its existing bank credit facility (the
"Bank Credit Facility") or a combination thereof. Although Parent intends to
enter into discussions with one or more investment banking firms with respect to
a possible refinancing of such borrowings under the Bank Credit Facility
following the completion of the Offer, no specific arrangements therefor had
been entered into as of the date of this Offer to Purchase.
The Bank Credit Facility is provided for in a Credit Agreement, dated as of
January 31, 1997 (as amended, the "Credit Agreement"), with Bank of America
National Trust and Savings Association, as agent (the "Agent"), and the other
financial institutions party thereto. The Credit Agreement provides for an
unsecured revolving line of credit of $300 million, which terminates on January
31, 2002. As of the date of this Offer to Purchase, no borrowings were
outstanding under the Bank Credit Facility. The effective interest rate on
borrowings under the Bank Credit Facility is computed on the basis of specified
alternative interest rate formulas from which Parent may select. Parent believes
that, as of the date of this Offer to Purchase, such interest rate formulas
would result in rates of interest within the range of 5.5% to 6.5% per annum.
Advances under the Bank Credit Facility are conditioned upon (i) proper
notice to the Agent, (ii) the accuracy of the representations and warranties of
Parent set forth in the Credit Agreement (including representations and
warranties with respect to corporate existence, subsidiaries, corporate
authorization, governmental authorization, noncontravention, compliance with
laws, litigation, absence of defaults, use of proceeds, certain financial
statements and ERISA compliance), (iii) the absence, since the date of specified
financial statements, of any changes in Parent's consolidated financial
condition or results of operations sufficient to impair Parent's ability to
repay its borrowings under the Credit Agreement, and (iv) the absence of any
default under the Credit Agreement. Prior to entering into the Merger Agreement,
Parent obtained a waiver of certain provisions of the Credit Agreement that
would have prohibited the use of proceeds of borrowings under the Credit
Agreement to pay for Shares purchased pursuant to the Offer and that would have
prohibited the consummation of the Merger.
The foregoing summary of the Credit Agreement and the waiver thereunder
obtained by Parent is qualified in its entirety by reference to the full text of
the Credit Agreement and such waiver, which are incorporated by reference and
copies of which have been filed with the Commission as exhibits to the Schedule
14D-1. The Credit Agreement and such waiver may be examined at, and copies
thereof may be obtained from, the offices of the Commission in the same manner
as set forth in Section 8 above.
11. BACKGROUND OF THE OFFER
Over the past several years, Parent has considered a number of possible
acquisitions, business combinations and other transactions of or with other
companies in the forest products industry and, in connection therewith, engaged
in brief discussions with representatives of Company in early 1997. Following
the divestiture of Parent's California redwood properties and other nonstrategic
assets in June 1998, Parent's efforts in this area intensified. Among other
companies considered by Parent in this regard was the Company.
On October 12, 1998, Mark A. Suwyn, the Chairman and Chief Executive Officer
of Parent, contacted George T. Brophy, the Chairman, and Chief Executive Officer
of Company, and informed him that Parent was interested in exploring the
possible acquisition of Company by Parent and indicated a potential purchase
price of $11.00 per Share. Mr. Brophy informed Mr. Suwyn that Company might be
willing to engage in these discussions, but only if a customary confidentiality
agreement was signed. On October 19, 1998, Parent and Company entered into an
agreement providing for the confidential treatment of any discussions relating
to a possible acquisition of Company by Parent and of any
17
<PAGE>
confidential information exchanged by Company and Parent in connection with such
discussions. On October 28, 1998, representatives of Parent and Company met to
review and discuss financial, business, operational and other information
regarding Company.
On November 4, 1998, a representative of Parent indicated to a
representative of Kohlberg & Co. (certain affiliates of which own 46.0% of the
Shares outstanding as of January 14, 1999), who was also a member of Company's
Board of Directors, that Parent might be willing to pay a purchase price in the
range of $12.00 to $13.00 per Share for all outstanding Shares, and reviewed
with the Kohlberg & Co. representative certain financial assumptions underlying
Parent's valuation of Company's business. The Kohlberg & Co. representative
indicated that he believed that Company's Board of Directors and stockholders
would not favor a transaction in that price range.
Further discussions were held between November 4, 1998 and November 10, 1998
among representatives of Parent and Company regarding Parent's valuation
assumptions and indicated purchase price. On November 10, 1998, representatives
of Parent indicated to representatives of Company that Parent might be willing
to increase its indicated price to $14.50 per Share depending upon its review of
information relating to Company, its level of assurance that, if announced, the
transaction would be completed and other factors. The representatives of Company
indicated to the representatives of Parent that they believed that any price
less than $15.00 per Share would be unacceptable to Company's Board of Directors
and stockholders.
Thereafter, through approximately January 18, 1999 and with generally
increasing frequency, representatives of Parent had various meetings and
discussions with representatives of Company in connection with Parent's due
diligence review of Company.
On December 21, 1998, Parent proposed that the Company undertake for a
period of less than 30 days to negotiate exclusively with Parent in pursuit of
the possible acquisition of Company by Parent for between $14.50 and $15.00 per
Share in cash. In subsequent discussions, Parent also indicated that any
definitive agreement for an acquisition of Company by Parent would be
conditioned upon the Principal Stockholders contractually committing themselves
to support and participate in the transaction. Company rejected Parent's request
for exclusivity and emphasized Company's position that the purchase price be
$15.00 per Share. Without making any commitment as to the specific manner in
which the Principal Stockholders might agree to support any transaction that
might ultimately be negotiated, Company indicated that it was willing to
continue discussions with Parent.
Parent subsequently reiterated its request for exclusivity on a number of
occasions. On each such occasion, Company refused to grant Parent exclusivity,
but indicated its willingness to pursue discussions for an acquisition of
Company by Parent. Parent also requested that the Principal Stockholders agree
to tender their Shares into the Offer, vote in favor of the Merger and grant
Parent an option on their Shares in connection with the proposed transaction.
The Principal Stockholders indicated a willingness to agree to tender their
Shares and vote in favor of the Merger, but resisted Parent's request for an
option.
On January 8, 1998, representatives of Parent and Company, including Messrs.
Suwyn and Brophy, met to discuss the possible acquisition of Company by Parent.
At that meeting, the representatives of Parent indicated to the representatives
of Company that, subject to satisfactory completion of Parent's financial,
business and operational review of Company, Parent would be willing to increase
its indicated price to $15.00 per Share in cash and representatives of Company
orally agreed not to actively solicit any third party for a competing
transaction through January 17, 1999.
Thereafter, business, legal and financial representatives of Company and
Parent met or continued discussions of the possible transaction on numerous
occasions, including on a substantially continuous basis during the period from
January 12 through January 18, 1999. During this period, Parent made it clear to
the Company that it would not proceed with the transaction without an option on
the Principal Stockholders' Shares. On January 18, 1999, the Principal
Stockholders agreed to grant such option and to the final terms of the
Stockholder Agreement. Later that day, the respective Boards of Directors of
Parent and Company approved the Merger Agreement and the Board of Directors of
Parent approved the Stockholder Agreement. Such agreements were then executed
and delivered by the respective parties thereto and the transaction was publicly
announced on January 19, 1999.
18
<PAGE>
12. PURPOSE OF THE OFFER AND THE MERGER; PLANS FOR COMPANY; THE MERGER
AGREEMENT; THE STOCKHOLDER AGREEMENT; OTHER MATTERS
PURPOSE OF THE OFFER AND THE MERGER. The purpose of the Offer and the
Merger is to enable Purchaser to acquire control of Company and the entire
equity interest in Company. The Offer is intended to increase the likelihood
that the Merger will be completed promptly. The acquisition of the entire equity
interest in Company has been structured as a cash tender offer followed by a
cash merger in order to provide a prompt and orderly transfer of ownership of
Company from the Stockholders to Parent and to provide the Stockholders with
cash in a per Share amount equal to the Offer Consideration for all of their
Shares.
PLANS FOR COMPANY. Following the Merger, Company will be operated as a
wholly owned subsidiary of Parent. Except as otherwise provided in this Offer to
Purchase, and for possible transactions between Company and other subsidiaries
of Parent in connection with the integration of the business conducted by
Company with the other businesses of Parent and its subsidiaries, Purchaser and
Parent have no current plans or proposals that would result in an extraordinary
corporate transaction, such as a merger, reorganization, liquidation or sale or
transfer of a material amount of assets involving Company or any subsidiary of
Company, or any other material changes in Company's capitalization, dividend
policy, corporate structure, business or composition of its management.
Parent intends, from time to time after completion of the Offer, to evaluate
and review Company's operations and the potential opportunities for
rationalization and the achievement of synergies with Parent's operations, and
to consider what, if any, changes would be desirable in light of the results of
such evaluations and reviews. After such review, it is possible that Parent
might modify its current plans not to dispose of any significant businesses or
assets of Company and not effect any significant changes in Company's
operations.
THE MERGER AGREEMENT. The following is a summary of the material terms of
the Merger Agreement. This summary is not a complete description of the terms
and conditions of the Merger Agreement and is qualified in its entirety by
reference to the full text of the Merger Agreement, which is incorporated by
reference and a copy of which has been filed with the Commission as an exhibit
to the Schedule 14D-1. The Merger Agreement may be examined at, and copies
thereof may be obtained from, the offices of the Commission in the same manner
as set forth in Section 8 above.
THE OFFER. The Merger Agreement provides for the commencement of the Offer.
Without the prior written consent of Company, Purchaser has agreed not to (and
Parent has agreed to cause Purchaser not to) (i) decrease or change the form of
the Offer Consideration or decrease the number of Shares sought pursuant to the
Offer, (ii) amend any term of the Offer in any manner adverse to holders of
Shares, (iii) change the conditions to the Offer, (iv) impose additional
conditions to the Offer, (v) waive the Minimum Share Condition, or (vi) extend
the Expiration Date (except that Purchaser may, without the consent of Company,
(a) extend the Offer, if at the Expiration Date any of the conditions to
Purchaser's obligation to purchase Shares is not satisfied, until such time as
such condition is satisfied or waived, and (b) extend the Offer for any period
required by any rule, regulation, interpretation or position of the Commission
or the Staff thereof). Except as set forth above and subject to applicable legal
requirements, Purchaser may amend the Offer or waive any condition to the Offer
in its sole discretion.
BOARD REPRESENTATION. The Merger Agreement provides that promptly upon the
purchase by Purchaser pursuant to the Offer of such number of Shares (together
with any Shares then owned by Parent or any of its subsidiaries) which
represents a majority of the outstanding Shares (on a fully diluted basis) on
the date of purchase, and from time to time thereafter, (i) Parent will be
entitled to designate such number of directors, rounded up to the next whole
number as will give Parent representation on the Board equal to the product of
(a) the number of directors on the Board (giving effect to any increase in the
number of directors pursuant to the Merger Agreement) and (b) the percentage
that such number of Shares so purchased (together with any Shares then owned by
Parent or any of its subsidiaries), bears to the aggregate number of Shares
outstanding on the date of purchase (such number being the "Board
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Percentage"), and (ii) Company will, upon request by Parent, promptly cause
Parent's designees constituting the Board Percentage to be elected to the Board
by (x) increasing the size of the Board or (b) using reasonable efforts to
secure the resignations of such number of directors as is necessary to enable
Parent's designees to be elected to the Board and will use its best efforts to
cause Parent's designees promptly to be so elected, subject in all instances to
compliance with Section 14(f) of the Exchange Act and Rule 14f-1 promulgated
thereunder. Following the election or appointment of Parent's designees pursuant
to the Merger Agreement and prior to the Effective Time, any amendment or
termination of the Merger Agreement, waiver of the obligations or other acts of
Parent or Purchaser or waiver of Company's rights thereunder will require the
concurrence of a majority of the Continuing Directors (defined as those
directors of Company then in office who were directors of Company on the date of
the Merger Agreement and who voted to approve the Merger Agreement and such
additional directors of Company, if any, who are not affiliated with Parent,
Purchaser or any of their affiliates and who were designated as "Continuing
Directors" by a majority of the directors who were Continuing Directors at the
time of such designation). Company is today mailing to the Stockholders a copy
of an Information Statement prepared in accordance with Rule 14f-1 promulgated
under the Exchange Act, relating to the possible designation by Parent, pursuant
to the Merger Agreement, of certain persons to be appointed to the Board
otherwise than at a meeting of the Stockholders.
CONSIDERATION TO BE PAID IN THE MERGER. The Merger Agreement provides that,
on the terms and subject to the conditions set forth in the Merger Agreement and
in accordance with the DGCL, Purchaser will be merged with and into Company at
the Effective Time. In the Merger, each Share issued and outstanding immediately
prior to the Effective Time (excluding Shares owned by Company or any of its
subsidiaries or Shares owned by Parent, Purchaser or any other subsidiary of
Parent and Dissenting Shares (as defined in the Merger Agreement)) will be
converted into the right to receive the Offer Consideration, payable in cash to
the holder thereof without any interest thereon, less any required withholding
taxes, upon surrender and exchange of a certificate representing such Shares.
Each share of the capital stock of Purchaser issued and outstanding immediately
prior to the Effective Time will be converted into and become one fully paid and
nonassessable share of Common Stock, par value $0.01 per share, of the Surviving
Corporation (as defined in the Merger Agreement), which will thereupon become a
wholly owned subsidiary of Parent. Each Share and all other shares of capital
stock of Company that are owned by Company or any subsidiary of Company and all
Shares owned by Parent, Purchaser or any other subsidiary of Parent will be
canceled and retired and will cease to exist and no consideration will be
delivered or deliverable in exchange therefor. The Merger will become effective
upon the filing of a certificate of merger with the Secretary of State of the
State of Delaware or at such time thereafter as is provided in the certificate
of merger.
COMPANY STOCK OPTIONS. The Merger Agreement provides that, at the Effective
Time, each then-outstanding option to purchase Shares (collectively, the
"Options") under Company's Amended and Restated Stock Option Plan, 1994 Director
Stock Option Plan, 1994 Employee Stock Option Plan and new employee compensation
policy (collectively, the "Stock Option Plans"), whether or not then
exercisable, will, in settlement thereof, receive for each Share subject to such
Option an amount (subject to any applicable withholding tax) in cash equal to
the difference between the Offer Consideration and the per Share exercise price
of such Option to the extent such difference is a positive number (such amount
being hereinafter referred to as, the "Option Consideration"); PROVIDED,
HOWEVER, that with respect to any person subject to Section 16(a) 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. Upon receipt of the Option Consideration therefor,
each Option will be canceled. The surrender of an Option to Company in exchange
for the Option Consideration will be deemed a release of any and all rights the
holder had or may have had in respect of such Option.
Company has agreed to use its reasonable best efforts to obtain all
necessary consents or releases from holders of Options under the Stock Option
Plans and take all such other lawful action as may be
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necessary to give effect to the transactions contemplated by the Merger
Agreement. Except as otherwise agreed to by the parties, (i) the Stock Option
Plans will terminate as of the Effective Time and the provisions in any other
plan, program or arrangement providing for the issuance or grant of any other
interest in respect of the capital stock of Company or any subsidiary thereof
will be canceled as of the Effective Time and (ii) Company will use its
reasonable best efforts to assure that following the Effective Time no
participant in the Stock Option Plans or other plans, programs or arrangements
will have any right thereunder to acquire any equity securities of Company, the
Surviving Corporation or any subsidiary thereof and to terminate all such plans.
STOCKHOLDER MEETING. The Merger Agreement provides that Company will, as
soon as practicable following the acceptance for payment of and payment for
Shares by Purchaser in the Offer, if required by applicable law to consummate
the Merger, duly call, give notice of, convene and hold a meeting of its
Stockholders for the purpose of considering and voting upon the Merger
Agreement. In connection with such meeting, if required by applicable law to
consummate the Merger, Company, in consultation with Parent, will prepare and
file with the Commission a proxy statement or information statement, together
with any supplement or amendment thereto (the "Proxy Statement"). Company has
agreed to use its reasonable efforts to respond to all Commission comments with
respect to the Proxy Statement and, subject to compliance with the Commission's
rules and regulations, to cause such proxy statement to be mailed to the
Stockholders at the earliest practicable date.
If Purchaser, or any other wholly owned subsidiary of Parent, acquires at
least 90% of the outstanding Shares in the Offer, at the request of Purchaser,
all parties to the Merger Agreement will take all necessary actions to cause the
Merger to become effective as soon as practicable after the expiration of the
Offer, without a meeting of the Stockholders, in accordance with the provisions
of Section 253 of the DGCL.
REPRESENTATIONS AND WARRANTIES. The Merger Agreement contains various
representations and warranties of the parties. These include representations and
warranties by Company with respect to: (i) organization, standing and corporate
power; (ii) authority and noncontravention; (iii) consents and approvals; (iv)
capital structure; (v) documents filed with the Commission; (vi) absence of
certain changes or events and undisclosed material liabilities; (vii) certain
information required by the Exchange Act and other applicable law; (viii) real
property and other assets; (ix) Year 2000 compliance; (x) intellectual property;
(xi) infringement; (xii) material contracts; (xiii) litigation; (xiv) compliance
with laws; (xv) environmental laws; (xvi) taxes; (xvii) benefit plans; (xviii)
absence of changes in benefit plans; (xix) labor matters; (xx) brokers' fees;
(xxi) opinion of one of its financial advisors; and (xxii) voting requirements.
Parent and Purchaser have also made certain representations and warranties
with respect to: (i) organization, standing and corporate power; (ii) authority
and noncontravention; (iii) consents and approvals; (iv) certain information
required by the Exchange Act and other applicable law; (v) financing; (vi)
brokers' fees; and (vii) operations of Purchaser.
No representations and warranties made by Company, Parent or Purchaser will
survive beyond the Effective Time.
CONDUCT OF BUSINESS PENDING THE MERGER. Company has agreed that during the
period from the date of the Merger Agreement until the Effective Time, except as
expressly provided for in the Merger Agreement or the agreement of Company for
the sale of its fiber cement plant (the "Fiber Cement Agreement"), Company will,
and will cause its subsidiaries to, conduct their businesses only in the
ordinary course of business consistent with past practice and, to the extent
consistent therewith, will use reasonable efforts to preserve intact its current
business organizations, keep available the services of its current key officers
and employees and preserve the goodwill of those engaged in material business
relationships with Company. Company has further agreed that during this period
and except as expressly provided in the Merger Agreement or the Fiber Cement
Agreement, it will not, nor will it permit any of its subsidiaries to: (i) (a)
declare, set aside or pay any dividends on, or make any other
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distributions (whether in cash, securities or other property) in respect of, any
of its outstanding capital stock (other than, with respect to a subsidiary of
Company, to its corporate parent), (b) split, combine or reclassify any of its
outstanding capital stock or issue or authorize the issuance of any other
securities in respect of, in lieu of or in substitution for shares of its
outstanding capital stock, or (c) purchase, redeem or otherwise acquire any
shares of outstanding capital stock or any rights, warrants or options to
acquire any such shares, except for the acquisition of Shares from holders of
Options in full or partial payment of the exercise price payable by such holder
upon exercise of Options; (ii) issue, sell, grant, pledge or otherwise encumber
any shares of its capital stock, any other voting securities or any securities
convertible into or exchangeable for, or any rights, warrants or options to
acquire, any such shares, voting securities or convertible or exchangeable
securities, other than upon the exercise of Options outstanding on the date of
the Merger Agreement; (iii) amend its certificate of incorporation, bylaws or
other comparable charter or organizational documents other than as required for
the performance by Company of its obligations under the Merger Agreement; (iv)
directly or indirectly acquire, make any investment in, or make any capital
contributions to, any person other than in the ordinary course of business
consistent with past practice; (v) directly or indirectly sell, pledge or
otherwise dispose of or encumber any of its properties or assets that are
material to its business, except for sales, pledges or other dispositions or
encumbrances in the ordinary course of business consistent with past practice;
(vi) (a) incur any indebtedness for borrowed money or guarantee any such
indebtedness of another person, other than indebtedness owing to or guarantees
of indebtedness owing to Company or any direct or indirect wholly owned
subsidiary of Company or (b) make any loans or advances to any other person,
other than to Company or to any direct or indirect wholly owned subsidiary of
Company and other than routine advances to employees consistent with past
practice, except, in the case of clause (a), for borrowings under existing
credit facilities described in the reports or other documents filed by the
Company with the Commission in the ordinary course of business consistent with
past practice; (vii) enter into any compromise or settlement of, or take any
material action with respect to, any litigation, action, suit, claim, proceeding
or investigation other than the prosecution, defense and settlement of routine
litigation, actions, suits, claims, proceedings or investigations in the
ordinary course of business; (viii) grant or agree to grant to any officer,
employee or consultant any increase in wages or bonus, severance, profit
sharing, retirement, deferred compensation, insurance or other compensation or
benefits, or establish any new compensation or benefit plans or arrangements, or
amend or agree to amend any existing Company employee benefit plans, except as
may be required under existing agreements or by law or pursuant to the normal
severance policies or practices of Company or its subsidiaries as in effect on
the date of the Merger Agreement, or increases in salary or wages payable or to
become payable in the ordinary course of business consistent with past practice;
(ix) accelerate the payment, right to payment or vesting of any bonus,
severance, profit sharing, retirement, deferred compensation, stock option,
insurance or other compensation or benefits; (x) enter into or amend any
employment, consulting, severance or similar agreement with any individual other
than in the ordinary course of business consistent with past practice, except
with respect to new hires of non-officer employees in the ordinary course of
business consistent with past practice; (xi) adopt or enter into a plan of
complete or partial liquidation, dissolution, merger, consolidation,
restructuring, recapitalization or other material reorganization or any
agreement relating to an Acquisition Proposal (as defined below); (xii) make any
tax election or settle or compromise any income tax liability of Company or of
any of its subsidiaries involving on an individual basis more than $100,000;
(xiii) make any change in any method of accounting or accounting practice or
policy, except as required by any changes in generally accepted accounting
principles; (xiv) enter into any agreement, understanding or commitment that
restrains, limits or impedes Company's ability to compete with or conduct any
business or line of business; (xv) plan, announce, implement or effect any
reduction in force, lay-off, early retirement program, severance program or
other program or effort concerning the termination of employment of employees of
Company or its subsidiaries; or (xvi) authorize any of, or commit or agree to
take any of, the foregoing actions.
CONSENTS, APPROVALS AND FILINGS. The Merger Agreement provides that each of
the parties to the Merger Agreement will (i) make promptly its respective
filings, and thereafter make any other required
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submissions, under the HSR Act and the Exchange Act, with respect to the Offer,
the Merger and the other transactions contemplated by the Merger Agreement and
(ii) use its reasonable best efforts to take, or cause to be taken, all
appropriate action, and to do, or cause to be done, all things necessary, proper
or advisable under applicable laws and regulations to consummate and make
effective the Offer, the Merger and the other transactions contemplated by the
Merger Agreement, including without limitation using its reasonable best efforts
to obtain all licenses, permits, consents, approvals, authorizations,
qualifications and orders of governmental entities and parties to contracts with
Company and its subsidiaries as are necessary for the consummation of the Offer,
the Merger and the other transactions contemplated by the Merger Agreement and
to fulfill the conditions to the Offer and the Merger, except that in no event
will Parent or any of its subsidiaries be required to agree or commit to divest,
hold separate, offer for sale, abandon, limit its operation of or take similar
action with respect to any assets (tangible or intangible) or any business
interest of it or any of its subsidiaries (including without limitation the
Surviving Company after consummation of the Merger) in connection with or as a
condition to receiving the consent or approval of any governmental entity
(including without limitation under the HSR Act). The Merger Agreement also
provides that in case at any time after the Effective Time any further action is
necessary or desirable to carry out the Merger Agreement, the proper officers
and directors of each party to the Merger Agreement will use their reasonable
best efforts to take such action. See Section 15.
EMPLOYEE BENEFIT MATTERS. The Merger Agreement provides that, from and
after the Effective Time, Parent will, and will cause its subsidiaries
(including the Surviving Company) to, honor and provide for payment of all
accrued obligations and benefits under all employee benefit plans of Company and
employment or severance agreements between Company and any persons who are or
had been employees of Company or any of its subsidiaries at or prior to the
Effective Time ("Covered Employees"), all in accordance with their respective
terms.
The Merger Agreement further provides that, from and after the Effective
Time, Parent will, and will cause its subsidiaries (including the Surviving
Company) to, provide Covered Employees who remain in the employ of Parent or any
such subsidiary employee benefits that are reasonably comparable to the employee
benefits provided to similarly situated employees of Parent or any such
subsidiary who are not Covered Employees. The Merger Agreement also provides
that, to the extent Covered Employees are included in any benefit plan of Parent
or its subsidiaries, Parent agrees that the Covered Employees will receive
credit under such plan for service prior to the Effective Time with Company and
its subsidiaries to the same extent such service was counted under similar
employee benefit plans of Company for purposes of eligibility, vesting,
eligibility for retirement (but not for benefit accrual) and, with respect to
vacation, disability and severance, benefit accrual. The Merger Agreement also
provides that, to the extent that Covered Employees are included in any medical,
dental or health plan other than the plan or plans they participated in at the
Effective Time, no such plans will include pre-existing condition exclusions,
except to the extent that such exclusions were applicable under the similar
Company employee benefit plan at the Effective Time, and all such plans will
provide credit for any deductibles and co-payments applied or made with respect
to each Covered Employee in the calendar year of the change.
Notwithstanding anything in the Merger Agreement to the contrary, from and
after the Effective Time, the Surviving Company will have sole discretion over
the hiring, promotion, retention, firing and other terms and conditions of the
employment of employees of the Surviving Company. Except as otherwise provided
in the Merger Agreement, nothing in the Merger Agreement prevents Parent or the
Surviving Company from amending or terminating any Company benefit plan in
accordance with its terms.
NO SOLICITATION. The Merger Agreement provides that, during the period from
and including the date of the Merger Agreement to the Effective Time, Company
will not, and will not authorize or permit any of its subsidiaries, or any of
its or their affiliates, officers, directors, employees, agents or
representatives (including without limitation any investment banker, financial
advisor, attorney or accountant
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retained by Company or any of its subsidiaries), to, directly or indirectly,
initiate, solicit or encourage (including by way of furnishing information or
assistance), or take any other action to facilitate, any Acquisition Proposal
(as defined below), or enter into or maintain or continue discussions or
negotiations with any person in furtherance of, or approve, agree to, endorse or
recommend, any Acquisition Proposal, except that nothing in the Merger Agreement
will prohibit the Board, prior to the time at which the Merger Agreement is
adopted by the Stockholders, from furnishing information to, or entering into,
maintaining or continuing discussions or negotiations with, any person that
makes a bona fide written Acquisition Proposal after the date of the Merger
Agreement under circumstances not involving any breach of the provisions
described above in this sentence if, and to the extent that, (i) the Board,
after consultation with and based upon the advice of independent legal counsel,
determines in good faith that the failure to take such action would constitute a
breach by the Board of its fiduciary duties to the Stockholders under applicable
law and (ii) prior to furnishing any non-public information to such person,
Company receives from such person an executed confidentiality agreement with
provisions no less favorable to Company than the letter agreement relating to
the furnishing of confidential information of Company to Parent. The Merger
Agreement further provides that Company will promptly (and, in any event within
24 hours) notify Parent after receipt of any Acquisition Proposal or any request
for information relating to Company or its subsidiaries or for access to the
properties, books or records of Company or any of its subsidiaries by any person
who has informed Company that such person is considering making, or has made, an
Acquisition Proposal (which notice will identify the person making, or
considering making, such Acquisition Proposal and will set forth the material
terms of any Acquisition Proposal received), and that Company will keep Parent
informed in reasonable detail of the terms, status and other pertinent details
of any such Acquisition Proposal.
The Merger Agreement further provides that during the period from and
including the date of the Merger Agreement to and including the Effective Time,
neither the Board nor any committee thereof will withdraw or modify, or propose
publicly to withdraw or modify, in a manner adverse to Parent or Purchaser, the
approval of the Merger Agreement or the transactions contemplated thereby or the
recommendation provided in the Introduction to this Offer to Purchase, except
that nothing contained in the Merger Agreement will (i) prohibit the Board from
withdrawing or modifying such recommendation following the receipt by Company
after the date of the Merger Agreement, under circumstances not involving any
breach of the provisions described in the immediately preceding paragraph, of an
Acquisition Proposal if, and to the extent that, the Board, after consultation
with and based upon the advice of independent legal counsel, determines in good
faith that the failure to take such action would result in a breach by the Board
of its fiduciary duties to the Stockholders under applicable law or (ii)
prohibit the Board from, to the extent applicable, complying with Rule 14e-2
promulgated under the Exchange Act with regard to an Acquisition Proposal.
Subject to Company's right to terminate the Merger Agreement under certain
circumstances described below, no such action taken by the Board will permit
Company to enter into any agreement providing for any transaction contemplated
by an Acquisition Proposal for as long as the Merger Agreement remains in
effect.
For purposes of the Merger Agreement, "Acquisition Proposal" means an
inquiry, offer, proposal or indication of interest regarding any of the
following (other than the transactions contemplated by the Merger Agreement, the
Stockholder Agreement or the Fiber Cement Agreement) involving Company: (i) any
merger, consolidation, share exchange, recapitalization, business combination,
or other similar transaction; (ii) any sale, lease, exchange, mortgage, pledge,
transfer or other disposition of all or substantially all of the assets of
Company and its subsidiaries, taken as a whole, in a single transaction or
series of related transactions; (iii) any tender offer or exchange offer or
other acquisition of 20% or more of the outstanding shares of capital stock of
Company or the filing of a registration statement under the Securities Act in
connection therewith; or (iv) any public announcement of a proposal, plan or
intention to do any of the foregoing or any agreement to engage in any of the
foregoing.
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FEES AND EXPENSES. The Merger Agreement provides that whether or not the
Merger is consummated, each party will pay its own expenses incident to
preparing for, entering into and carrying out the Merger Agreement and the
consummation of the transactions contemplated thereby.
INDEMNIFICATION; DIRECTORS' AND OFFICERS' INSURANCE. The Merger Agreement
provides that, for a period of six years after the Effective Time, the
provisions with respect to indemnification set forth in the certificate of
incorporation and bylaws of Purchaser will not be amended, repealed or otherwise
modified in any manner that would adversely affect the rights thereunder of
individuals who at any time prior to the Effective Time were directors or
officers of Company in respect of actions or omissions occurring at or prior to
the Effective Time (including without limitation the transactions contemplated
by the Merger Agreement), unless such modification is required by law.
The Merger Agreement also provides that from and after the Effective Time,
Parent will, or will cause the Surviving Company to, indemnify, defend and hold
harmless each person who is now, or has been at any time prior to the date
thereof or who becomes prior to the Effective Time, an officer or director of
Company (the "Indemnified Parties") against all losses, claims, damages, costs,
expenses (including reasonable attorneys' fees and expenses), liabilities or
judgments or amounts that are paid in settlement with the approval of the
indemnifying party (which approval will not be unreasonably withheld) incurred
in connection with any threatened or actual action, suit or proceeding based in
whole or in part on or arising in whole or in part out of the fact that such
person is or was a director or officer of Company ("Indemnified Liabilities"),
including all Indemnified Liabilities based in whole or in part on, or arising
in whole or in part out of, the Merger Agreement or the transactions
contemplated thereby, in each case, to the full extent that a corporation is
permitted under the DGCL to indemnify its own directors or officers, as the case
may be (and shall pay expenses in advance of the final disposition of any such
action, suit or proceeding to each Indemnified Party to the full extent
permitted by the DGCL, upon receipt of an undertaking by or on behalf of such
Indemnified Party to repay such amount if it shall ultimately be determined that
such person is not entitled to be so indemnified). The foregoing rights to
indemnification under the Merger Agreement will continue in full force and
effect for a period of four years from the Effective Time; provided, however,
that all rights to indemnification in respect of any Indemnified Liabilities
asserted or made within such period shall continue until the disposition of such
Indemnified Liabilities.
The Merger Agreement provides that, for a period commencing at the Effective
Time and expiring on the sixth anniversary of the Effective Time, Parent will
cause to be maintained in effect policies of directors' and officers' liability
insurance, for the benefit of those persons who are covered by Company's
directors' and officers' liability insurance policies at the Effective Time,
providing coverage with respect to matters occurring prior to the Effective Time
that is at least equal to the coverage provided under Company's current
directors' and officers' liability insurance policies, to the extent that such
liability insurance can be maintained at an annual cost to Parent not greater
than $350,000. The Merger Agreement further provides that if such insurance
cannot be so maintained at such cost, Parent will maintain as much of such
insurance as can be so maintained at a cost equal to $350,000.
CONDITIONS TO THE MERGER. Pursuant to the Merger Agreement, the obligation
of each party to effect the Merger is subject to the satisfaction or written
waiver prior to the Closing Date, of the following conditions: (i) Purchaser
shall have accepted for payment and paid for all Shares validly tendered in the
Offer and not withdrawn, provided, however, that, neither Parent nor Purchaser
may invoke this condition if Purchaser has failed to purchase Shares so tendered
and not withdrawn in violation of the terms of the Merger Agreement or the
Offer; (ii) the Merger Agreement shall have been adopted by the affirmative vote
of the holders of the requisite number of shares of capital stock of the Company
if such vote is required pursuant to Company's certificate of incorporation, the
DGCL or by applicable law; (iii) no temporary restraining order, preliminary or
permanent injunction or other order issued by any court of competent
jurisdiction or other legal restraint or prohibition preventing the consummation
of the Merger shall be in effect; provided, however, that prior to invoking this
condition the party so invoking this condition shall have complied with its
obligations under the Merger Agreement relating to the taking of
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actions necessary for the consummation of the Merger; and (iv) all necessary
waiting periods under the HSR Act applicable to the Merger shall have expired or
been earlier terminated.
TERMINATION. The Merger Agreement may be terminated and the transactions
contemplated therein may be abandoned at any time prior to the Effective Time,
notwithstanding the adoption of the Merger Agreement by the Stockholders, in any
one of the following circumstances: (i) by mutual written consent duly
authorized by the Boards of Parent and Company; (ii) by Parent or Company if
Shares have not been purchased by Purchaser pursuant to the Offer on or before
April 30, 1999, other than as a result of any material breach of any provision
of the Merger Agreement by the party seeking to effect such termination; (iii)
by Parent or Company if, as a result of the failure of any of the conditions to
the Offer set forth in Section 14, the Offer shall have expired or Purchaser
shall have terminated the Offer in accordance with the terms and conditions
thereof without any Shares being purchased by Purchaser thereunder; provided,
however, that the right to terminate the Merger Agreement pursuant to this
provision will not be available to any party whose breach of or failure to
fulfill its obligations under the Merger Agreement resulted in the failure of
any such condition; (iv) by Parent or Company, if any court of competent
jurisdiction or other governmental entity shall have issued an order, decree or
ruling or taken any other action permanently enjoining, restraining or otherwise
prohibiting the Merger or the acceptance for payment of, or payment for, the
Shares pursuant to the Offer and such order, decree or ruling or other action
shall have become final and nonappealable; provided that the party seeking to
terminate this Agreement shall have used its reasonable best efforts to remove
or lift such order, decree or ruling; (v) by Parent if the Board or any
committee thereof shall have (a) withdrawn or modified in a manner adverse to
Parent or Purchaser, or publicly taken a position materially inconsistent with,
its approval or recommendation of the Merger Agreement, the Offer, the Merger or
the other transactions contemplated thereby, (b) approved, endorsed or
recommended an Acquisition Proposal, or (c) resolved or publicly disclosed any
intention to do any of the foregoing; (vi) by Company, following the receipt by
Company after the date hereof, under circumstances not involving any breach of
the obligations of Company described under the caption "No Solicitation" above,
of a bona fide written Acquisition Proposal, if the Board of Directors of
Company, after consultation with and based upon the advice of independent legal
counsel, shall have determined in good faith that the failure to terminate the
Merger Agreement would constitute a breach by the Board of its fiduciary duties
to the Stockholders under applicable law; provided that (a) Company has complied
with specified provisions of the Merger Agreement, including specified notice
provisions, (b) Company enters into a definitive agreement providing for the
transactions contemplated by such Acquisition Proposal immediately following
such termination, and (c) such termination shall not be effective until Company
shall have paid to Parent the Fee (as defined below) in accordance with
provisions of the Merger Agreement; or (vii) by Company if Purchaser or Parent
shall have (a) failed to commence the Offer within five business days after the
public announcement by Parent and Company of the Merger Agreement, (b) failed to
pay for the Shares pursuant to the Offer in accordance with the Merger
Agreement, or (c) breached in any material respect any of their respective
representations, warranties, covenants or other agreements contained in the
Merger Agreement, which breach described in this clause (c) is incapable of
being cured or has not been cured within 20 days after the giving of written
notice to Parent or Purchaser, as applicable, except such breaches described in
this clause (c) as individually or in the aggregate would not reasonably be
expected to materially and adversely affect the ability of Parent or Purchaser
to complete the Offer or the Merger on the terms and subject to the conditions
of the Merger Agreement. If the Merger Agreement is terminated under the
circumstances described in clause (v) or (vi) above, Company will be obligated
to pay Parent a fee in the amount of $5,000,000 (the "Fee"), which amount will
be payable in immediately available funds (a) promptly (and in any event within
three business days) after such termination, in the case of termination under
the circumstances described in clause (v) above or (b) prior to or concurrently
with such termination, in the case of termination under the circumstances
described in clause (vi) above.
AMENDMENT. Subject to any applicable provisions of the DGCL, at any time
prior to the Effective Time, the parties to the Merger Agreement may modify or
amend the Merger Agreement by written
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agreement executed and delivered by duly authorized officers of the respective
parties. However, after the adoption of the Merger Agreement, no amendment will
be made which would reduce the amount or change the type of consideration into
which each Share will be converted upon consummation of the Merger. The Merger
Agreement may not be modified or amended except by written agreement executed
and delivered by duly authorized officers of each of the respective parties.
ASSIGNMENT. Neither the Merger Agreement nor any of the rights, interests
or obligations thereunder may be assigned or delegated, in whole or in part, by
operation of law or otherwise by any of the parties thereto without the prior
written consent of the other parties, and any such assignment without such prior
written consent will be null and void, except that Parent and/or Purchaser may
assign the Merger Agreement to any direct or indirect wholly owned subsidiary of
Parent without the prior consent of Company, provided that the Parent and/or
Purchaser, as the case may be, will remain liable for all of its obligations
under the Merger Agreement. Subject to the immediately preceding sentence, the
Merger Agreement will be binding upon, inure to the benefit of, and be
enforceable by, the parties and their respective successors and assigns.
TIMING. The exact timing and details for the Merger will depend upon legal
requirements and a variety of other factors, including the number of Shares
acquired by Purchaser pursuant to the Offer. Although Purchaser has agreed to
cause the Merger to be consummated on the terms set forth above, there can be no
assurance as to the timing of the Merger.
THE STOCKHOLDER AGREEMENT. As a condition and an inducement to the
willingness of Parent and Purchaser to enter into the Merger Agreement, Parent
and Purchaser requested that Kohlberg Associates, L.P., KABT Acquisition
Company, L.P. and George T. Brophy (i.e., the "Principal Stockholders"), which
collectively own 4,952,554 Shares, or approximately 46.4% of the Shares
outstanding as of January 14, 1999 (and one of whom, Mr. Brophy, holds options
to purchase an additional 710,000 Shares from Company), enter into the
Stockholder Agreement. The following is a summary of the material terms of the
Stockholder Agreement. This summary is not a complete description of the terms
and conditions of the Stockholder Agreement and is qualified in its entirety by
reference to the full text of the Stockholder Agreement, which is incorporated
by reference and a copy of which has been filed with the Commission as an
exhibit to the Schedule 14D-1. The Stockholder Agreement may be examined at, and
copies thereof may be obtained from, the offices of the Commission in the same
manner as set forth in Section 8 above.
TENDER OF SHARES. Each Principal Stockholder has agreed to cause to be
validly tendered (and not withdrawn) pursuant to and in accordance with the
terms of the Offer, not later than the tenth business day after commencement of
the Offer, all Shares beneficially owned by such Principal Stockholder (such
Shares, together with any other Shares the beneficial ownership of which is
acquired by such Principal Stockholder, being such Principal Stockholder's
"Subject Shares"). If the Offer is amended in any manner set forth in the Merger
Agreement as requiring the consent of Company, the Principal Stockholders will
not be obligated to tender their Subject Shares unless such amendment is made
with their prior approval (which is not to be unreasonably withheld).
VOTING OF SHARES. At any meeting of the Stockholders called to consider and
vote upon the adoption of the Merger Agreement (and at any and all postponements
and adjournments thereof), and in connection with any action to be taken in
respect of the adoption of the Merger Agreement by written consent of
Stockholders, each Principal Stockholder has agreed to vote or cause to be voted
(including by written consent, if applicable) all of such Principal
Stockholder's Subject Shares in favor of the adoption of the Merger Agreement
and in favor of any other matter necessary for the consummation of the
transactions contemplated by the Merger Agreement and considered and voted upon
at any such meeting or made the subject of any such written consent, as
applicable.
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At any meeting of the Stockholders called to consider and vote upon any
Adverse Proposal (as defined below) (and at any and all postponements and
adjournments thereof), and in connection with any action to be taken in respect
of any Adverse Proposal by written consent of Stockholders, each Principal
Stockholder has agreed to vote or cause to be voted (including by written
consent, if applicable) all of such Principal Stockholder's Subject Shares
against such Adverse Proposal. For purposes of the Stockholder Agreement, the
term "Adverse Proposal" means any (a) Acquisition Proposal, (b) proposal or
action that would reasonably be expected to result in a breach of any covenant,
representation or warranty of Company set forth in the Merger Agreement, or (c)
proposal or action that is intended or would reasonably be expected to impede,
interfere with, delay or materially and adversely affect the Merger or any of
the other transactions contemplated by the Merger Agreement or the Stockholder
Agreement.
IRREVOCABLE PROXY. Pursuant to the Stockholder Agreement, each Principal
Stockholder has appointed Parent and any designee of Parent, each of them
individually, such Principal Stockholder's proxy and attorney-in-fact pursuant
to the provisions of Section 212 of the DGCL, with full power of substitution
and resubstitution, to vote or act by written consent with respect to such
Principal Stockholder's Subject Shares in accordance with the Stockholder
Agreement. Each Principal Stockholder has agreed that the proxy is coupled with
an interest and is irrevocable.
GRANT OF OPTION. Each Principal Stockholder has granted to Parent an
irrevocable option (each, an "Option" and, collectively, the "Options") to
purchase such Principal Stockholder's Subject Shares on the terms and subject to
the conditions set forth in the Stockholder Agreement at a purchase price per
share equal to $15.00 or the highest per share price paid in the Offer (the
"Purchase Price"). If (i) the Offer is consummated but (whether due to improper
tender or withdrawal of tender) Purchaser has not accepted for payment and paid
for all of the Subject Shares, or (ii) the Merger Agreement is terminated
(otherwise than by the mutual consent of the parties or as a result of the entry
of a final, nonappealable injunction against the Offer or the Merger under
circumstances not involving a breach by Company of its obligation to seek the
removal thereof) in accordance with its terms for reasons other than the failure
of Parent or Purchaser to fulfill their respective obligations under the Merger
Agreement, the Options will, in any such case, become exercisable (in whole but
not in part) upon the first to occur of any such event and remain exercisable
(in whole but not in part) until the date that is 30 days after the date of the
occurrence of an event described in clause (i) above, or the date that is 90
days after the date of the occurrence of the event described in clause (ii)
above (the applicable period of exercisability being the "Option Period").
EXERCISE OF OPTION. Parent may exercise all of the Options, in whole but
not in part, at any time or from time to time during the Option Period.
Notwithstanding anything in the Stockholder Agreement to the contrary, Parent
will be entitled to purchase all Subject Shares in respect of which it will have
exercised an Option in accordance with the terms of the Stockholder Agreement
prior to the expiration of the Option Period, and the expiration of the Option
Period will not affect any rights thereunder which by their terms do not
terminate or expire prior to or as of such expiration.
The Stockholder Agreement provides that, if Parent wishes to exercise an
Option, it will deliver to the applicable Principal Stockholder (each a "Selling
Stockholder") a written notice (an "Exercise Notice") to that effect which
specifies a date (an "Option Closing Date") not earlier than three business days
after the date such Exercise Notice is delivered for the consummation of the
purchase and sale of such Subject Shares (an "Option Closing"). If the Option
Closing cannot be effected on the Option Closing Date specified in the Exercise
Notice by reason of any applicable judgment, decree, order, law or regulation,
or because any applicable waiting period under the HSR Act shall not have
expired or been terminated, (i) the Principal Stockholders have agreed to
promptly take all such actions as may be requested by Parent, and will otherwise
fully cooperate with Parent, to cause the elimination of all such
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impediments to the Option Closing and (ii) the Option Closing Date specified in
the Exercise Notice will be extended to the third business day following the
elimination of all such impediments.
ADJUSTMENT UPON CHANGES IN CAPITALIZATION, ETC. In the event of any change
in the capital stock of Company by reason of a stock dividend, subdivision,
reclassification, recapitalization, split, combination, exchange of shares,
extraordinary distribution or similar transaction, the type and number or amount
of shares, securities or other property subject to each of the Options, and the
Purchase Price payable therefor, will be adjusted appropriately, and proper
provision will be made in the agreements governing such transaction, so that (a)
Parent will receive upon exercise of any Option the type and number or amount of
shares, securities or property that Parent would have retained and/or been
entitled to receive in respect of the applicable Selling Stockholder's Subject
Shares if the Option had been exercised immediately prior to such event relating
to Company or the record date therefor, as applicable, and (b) the applicable
Selling Stockholder will receive upon exercise of any Option granted by such
Selling Stockholder the amount of cash that such Selling Stockholder would have
received as a result of the exercise of the Option if the Option had been
exercised immediately prior to such event relating to Parent or the record date
therefor, as applicable. The foregoing adjustment will apply in a like manner to
successive stock dividends, subdivisions, reclassifications, recapitalizations,
splits, combinations, exchanges of shares, extraordinary distributions or
similar transactions.
ACQUIRED SHARES. The Stockholder Agreement provides that, in the event that
Subject Shares are acquired by Parent pursuant to the exercise of the Options
(such acquired Subject Shares being "Acquired Shares") and Parent thereafter
sells, transfers or disposes of Acquired Shares within 18 months after the
acquisition of such Acquired Shares (any such sale, transfer or disposition of
Acquired Shares occurring within such 18-month period being a "Sale"), Parent
will promptly pay to the Selling Stockholders (pro rata, in proportion to the
number of Acquired Shares purchased from each Selling Stockholder) an amount in
cash equal to the positive difference (if any) between the aggregate proceeds
received by Parent in the Sale (net of selling commissions, if any) and the
aggregate Purchase Price paid by Parent for the Acquired Shares sold,
transferred or disposed of in such Sale. Parent has agreed to effect any Sale of
Acquired Shares only to an unaffiliated party in a bona fide arm's-length
transaction.
REPRESENTATIONS AND WARRANTIES. The Stockholder Agreement contains various
representations and warranties of the parties. Each Principal Stockholder has
made certain representations and warranties with respect to: (i) title to such
Principal Stockholder's Subject Shares; (ii) authority; and (iii)
noncontravention. Each of Parent and Purchaser has made certain representations
and warranties with respect to: (i) authority; (ii) noncontravention; and (iii)
securities law compliance.
RESTRICTION ON TRANSFER OF SUBJECT SHARES, PROXIES AND NONINTERFERENCE. The
Stockholder Agreement provides that no Principal Stockholder will, directly or
indirectly: (A) except pursuant to the terms of the Stockholder Agreement and
for the conversion of Subject Shares at the Effective Time pursuant to the terms
of the Merger Agreement, offer for sale, sell, transfer, tender, pledge,
encumber, assign or otherwise dispose of, or enter into any contract, option or
other arrangement or understanding with respect to or consent to the offer for
sale, sale, transfer, tender, pledge, encumbrance, assignment or other
disposition of, any or all of such Principal Stockholder's Subject Shares; (B)
except pursuant to the terms of the Stockholder Agreement, grant any proxies or
powers of attorney, deposit any of such Principal Stockholder's Subject Shares
into a voting trust or enter into a voting agreement with respect to any of such
Principal Stockholder's Subject Shares; or (C) take any action that would
reasonably be expected to make any representation or warranty contained in the
Stockholder Agreement untrue or incorrect or have the effect of impairing the
ability of such Principal Stockholder to perform such Principal Stockholder's
obligations under the Stockholder Agreement or preventing or delaying the
consummation of any of the transactions contemplated thereby.
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NO SOLICITATION. The Principal Stockholders have agreed that they will not,
and will not authorize or permit any of their respective officers, directors,
employees, agents or representatives (including without limitation any
investment bankers, financial advisors, attorneys or accountants) to, directly
or indirectly, initiate, solicit, or encourage (including by way of furnishing
information or assistance), or take any other action to facilitate, any
Acquisition Proposal, or enter into or maintain or continue discussions or
negotiations with any person in furtherance of, or approve, agree to, endorse or
recommend, any Acquisition Proposal.
TERMINATION. The Stockholder Agreement will terminate immediately upon the
earlier of (i) the Effective Time and (ii) the date on which the Option Period
expires (or, if later, the date on which the last Option Closing occurs). The
Stockholder Agreement provides that Parent and Purchaser will not amend the
Merger Agreement to increase the Merger Consideration without the prior written
consent of the Principal Stockholders representing a majority of the Subject
Shares subject to the Stockholder Agreement.
OTHER MATTERS
APPRAISAL RIGHTS. No appraisal rights are available to Stockholders in
connection with the Offer. However, if the Merger is consummated, a Stockholder
will have certain rights under Section 262 of the DGCL to dissent and demand
appraisal of, and payment in cash for the fair value of, that Stockholder's
Shares. Those rights, if the statutory procedures are complied with, could lead
to a judicial determination of the fair value (excluding any value arising from
the Merger) required to be paid in cash to dissenting Stockholders for their
Shares. Any judicial determination of the fair value of Shares could be based
upon considerations other than or in addition to the Merger Consideration and
the market value of the Shares, including asset values and the investment value
of the Shares. The value so determined could be more or less than the Merger
Consideration.
If a Stockholder who demands appraisal under Section 262 of the DGCL fails
to perfect, or effectively withdraws or loses, his or her right to appraisal as
provided in the DGCL, the Shares of that Stockholder will be converted into the
right to receive the Merger Consideration in accordance with the Merger
Agreement. A Stockholder may withdraw his demand for appraisal by delivering to
Purchaser a written withdrawal of such demand for appraisal and acceptance of
the Merger.
Failure to precisely follow the steps required by Section 262 of the DGCL
for the perfection of appraisal rights may result in the loss of those rights.
GOING-PRIVATE TRANSACTIONS. Rule 13e-3 under the Exchange Act is applicable
to certain "going-private" transactions. Purchaser does not believe that Rule
13e-3 will be applicable to the Merger, unless, among other things, the Merger
is completed more than one year after termination of the Offer. If applicable,
Rule 13e-3 would require, among other things, that certain financial information
regarding Company and certain information regarding the fairness of the Merger
and the consideration offered to minority Stockholders be filed with the
Commission and disclosed to minority Stockholders prior to consummation of the
Merger.
13. DIVIDENDS AND DISTRIBUTIONS
If, on or after the date of the Merger Agreement, and prior to the Effective
Time, the outstanding Shares are changed into a different number of shares of a
different class, by reason of any stock dividend, subdivision, reclassification,
recapitalization, split, combination or exchange of shares, the Offer
Consideration will be correspondingly adjusted on a per-share basis to reflect
such stock dividend, subdivision, reclassification, recapitalization, split,
combination or exchange of shares.
If, on or after the date of the Merger Agreement, Company (i) acquires
currently outstanding Shares, or otherwise causes a reduction in the number of
outstanding Shares or (ii) issues or sells additional
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Shares, shares of any other class of capital stock, other voting securities or
any securities convertible into, or rights, warrants or options, conditional or
otherwise, to acquire, any of the foregoing then, subject to the provisions of
Section 14, Purchaser in its sole discretion, may make such adjustments as it
deems appropriate in the Offer Consideration and other terms of the Offer,
including, without limitation, the number or type of securities offered to be
purchased.
If, on or after the date of the Merger Agreement, Company declares or pays
any cash dividend on the Shares, makes other distributions on the Shares or
issues with respect to the Shares any additional Shares, shares of any other
class of capital stock, other voting securities or any securities convertible
into, or rights, warrants or options, conditional or otherwise, to acquire, any
of the foregoing, payable or distributable to Stockholders of record prior to
the transfer of the Shares purchased pursuant to the Offer to Purchaser or its
nominee or transferee on Company's stock transfer records, then, subject to
Section 14 below, (i) the Offer Consideration may, in the sole discretion of
Purchaser, be reduced by the amount of any cash dividend or cash distribution
and (ii) the whole of any non-cash dividend, distribution or issuance to be
received by the tendering Stockholders will (A) be received and held by the
tendering Stockholders for the account of Purchaser and will be required to be
promptly remitted and transferred by each tendering Stockholder to the
Depositary for the account of Purchaser, accompanied by appropriate
documentation of transfer or (B) at the direction of Purchaser, be exercised for
the benefit of Purchaser, in which case the proceeds of exercise promptly will
be remitted to Purchaser. Pending the remittance and subject to applicable law,
Purchaser will be entitled to all rights and privileges as owner of any non-cash
dividend, distribution, issuance or proceeds and may withhold the entire Offer
Consideration or deduct from the Offer Consideration the amount or value of the
non-cash dividend, distribution, issuance or proceeds, as determined by
Purchaser in its sole discretion.
Pursuant to the terms of the Merger Agreement, Company is prohibited from
taking any of the actions described in the three preceding paragraphs and
nothing in this Offer to Purchase shall constitute a waiver by Purchaser or
Parent of any of its rights under the Merger Agreement or a limitation of
remedies available to Purchaser or Parent for any breach of the Merger
Agreement, including termination of the Merger Agreement.
14. CERTAIN CONDITIONS OF THE OFFER
Notwithstanding any other provision of the Offer, Purchaser will not be
required to accept for payment or, subject to any applicable rules and
regulations of the Commission, including Rule 14e-1(c) under the Exchange Act
(relating to Purchaser's obligation to pay for or return tendered Shares
promptly after expiration or termination of the Offer), to pay for any Shares
tendered, and may postpone the acceptance for payment or, subject to the
restrictions referred to above, payment for any Shares tendered, and, subject to
the terms of the Merger Agreement, may amend or terminate the Offer (whether or
not any Shares have theretofore been purchased or paid for pursuant to the
Offer) if (i) there shall not have been validly tendered and not withdrawn prior
to the time the Offer shall otherwise expire a number of Shares (together with
any Shares then owned by Parent or any of its subsidiaries) which constitutes a
majority of the Shares outstanding on a fully-diluted basis on the date of
purchase ("on a fully diluted basis" having the following meaning, as of any
date: the number of Shares outstanding (excluding Shares held as treasury stock
by Company or any of its subsidiaries), together with the number of Shares
Company is then required to issue pursuant to obligations outstanding at that
date under employee stock option or other benefit plans or otherwise other than
unvested Options), (ii) any applicable waiting periods under the HSR Act shall
not have expired or been terminated prior to the expiration of the Offer; or
(iii) if at any time on or after the date of the Merger Agreement and before
acceptance for payment of, or payment for, such Shares, any of the following
events shall have occurred and remain in effect:
(A) any United States or Canadian governmental entity or authority or
any United States or Canadian court of competent jurisdiction in the United
States or in Canada shall have enacted,
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issued, promulgated, enforced or entered any statute, rule, regulation,
executive order, decree, injunction or other order which is in effect and
which (1) materially restricts, prevents or prohibits consummation of the
transactions contemplated by the Merger Agreement, including the Offer or
the Merger, (2) prohibits or limits materially the ownership or operation by
Parent or any of its subsidiaries of all or any material portion of the
business or assets of Company and its subsidiaries taken as a whole or
compels Company, Parent, or any of their subsidiaries to dispose of or hold
separate all or any material portion of the business or assets of Company
and its subsidiaries taken as a whole, or (3) imposes material limitations
on the ability of Parent, Purchaser or any other subsidiary of Parent to
exercise effectively full rights of ownership of any Shares, including,
without limitation, the right to vote any Shares acquired by Purchaser
pursuant to the Offer or otherwise on all matters properly presented to the
Stockholders, including, without limitation, the approval and adoption of
the Merger Agreement and the transactions contemplated thereby;
(B) there shall have been instituted or pending any action or proceeding
before any United States or Canadian court or governmental entity or
authority by any United States or Canadian governmental entity or authority
seeking any order, decree or injunction having any effect set forth in
paragraph (A) above;
(C) the representations and warranties of Company contained in the
Merger Agreement (without giving effect to the materiality qualifications
contained therein) shall not be true and correct as of the Expiration Date
of the Offer (as the same may be extended from time to time) as though made
on and as of such date (except for representations and warranties made as of
a specified date, which need be true and correct only as of the specified
date), except for any breach or breaches which, individually or in the
aggregate, would not reasonably be expected to have a material adverse
effect on (i) the ability of Company to perform its obligations under the
Merger Agreement or to consummate the transactions contemplated thereby or
(ii) the assets, liabilities (actual or contingent), financial condition,
results of operations or business of Company and its subsidiaries taken as a
whole, excluding any change or development resulting from (x) events
adversely affecting any principal markets served by the business of Company
generally or affecting the hardboard siding industry generally which do not
have a disproportionate adverse effect on Company or its subsidiaries, (y)
general economic conditions, including changes in the economies of any of
the jurisdictions in which Company or any of its subsidiaries conduct
business, which do not have a disproportionate adverse effect on Company or
its subsidiaries, or (z) the Merger Agreement, the Stockholder Agreement or
any transaction contemplated thereby; provided that this exception shall not
apply to the representations and warranties of Company relating to the
capital structure of Company);
(D) Company shall not have performed or complied in all material
respects with its obligations under the Merger Agreement to be performed or
complied with by it and such failure continues until the later of (1)
fifteen days after actual receipt by it of written notice from Purchaser
setting forth in detail the nature of such failure or (2) the Expiration
Date of the Offer;
(E) there shall have occurred any material adverse change, or any
development that is reasonably likely to result in a material adverse
change, in the assets, liabilities (actual or contingent), results of
operations or business of Company and its subsidiaries taken as a whole,
excluding any change or development resulting from (1) events adversely
affecting any principal markets served by the business of Company generally
or affecting the hardboard siding industry generally which do not have a
disproportionate adverse effect on Company or its subsidiaries, (2) general
economic conditions, including changes in the economies of any of the
jurisdictions in which Company or any of its subsidiaries conduct business,
which do not have a disproportionate adverse effect on Company or its
subsidiaries, or (3) the Merger Agreement, the Stockholder Agreement or any
transaction contemplated thereby;
(F) the Merger Agreement shall have been terminated in accordance with
its terms;
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(G) the Board or any committee thereof shall have (1) withdrawn or
modified in a manner adverse to Parent or Purchaser, or publicly taken a
position materially inconsistent with, its approval or recommendation of the
Merger Agreement, the Offer, the Merger or the other transactions
contemplated thereby, (2) approved, endorsed or recommended an Acquisition
Proposal, or (3) resolved or publicly disclosed any intention to do any of
the foregoing; or
(H) there shall have occurred (1) any general suspension of, or
limitation on prices (other than suspensions or limitations triggered by
price fluctuations on a trading day) for, trading in securities on any
national securities exchange in the United States, (2) the declaration of a
banking moratorium or any limitation or suspension of payments in respect of
the extension of credit by banks or other lending institutions in the United
States, (3) any commencement of war, armed hostilities or other
international or national calamity directly involving the United States
having a significant adverse effect on the functionality of financial
markets in the United States, or (4) in the case of any of the foregoing
existing at time of the commencement of the Offer, a material acceleration
or worsening thereof.
The foregoing conditions (other than the Minimum Share Condition) are for
the sole benefit of Purchaser and its affiliates and may be asserted by
Purchaser regardless of the circumstances giving rise to any such condition or
may be waived by Purchaser, in whole or in part, from time to time in its sole
discretion, except as otherwise provided in the Merger Agreement. The failure by
Purchaser at any time to exercise any of the foregoing rights will not be deemed
a waiver of any such right and each such right will be deemed an ongoing right
and may be asserted at any time and from time to time.
15. CERTAIN LEGAL MATTERS
Except as described in this Section 15, based on a review of publicly
available filings made by Company with the Commission and other publicly
available information concerning Company, but without any independent
investigation, neither Purchaser nor Parent is aware of any license or
regulatory permit that appears to be material to the business of Company and its
subsidiaries, taken as a whole, that might be adversely affected by Purchaser's
acquisition of Shares as contemplated in this Offer to Purchase or of any
approval or other action by any governmental authority that would be required
for the acquisition or ownership of Shares by Purchaser as contemplated in this
Offer to Purchase. Should any such approval or other action be required,
Purchaser and Parent presently contemplate that such approval or other action
will be sought, except as described below, under "State Takeover Laws." While,
except as otherwise expressly described in this Section 15, Purchaser does not
presently intend to delay the acceptance for payment of or payment for Shares
tendered pursuant to the Offer pending the outcome of any such matter, there can
be no assurance that any such approval or other action, if needed, would be
obtained or would be obtained without substantial conditions or that failure to
obtain any such approval or other action might not result in consequences
adverse to Company's business or that certain parts of Company's business might
not have to be disposed of if such approvals were not obtained or other actions
were not taken or in order to obtain any such approval or other action. If
certain types of adverse action are taken with respect to the matters discussed
below, Purchaser could decline to accept for payment or pay for any Shares
tendered. See Section 14 above for certain conditions to the Offer.
STATE TAKEOVER LAWS. A number of states throughout the United States have
enacted takeover statutes that purport, in varying degrees, to be applicable to
attempts to acquire securities of corporations that are incorporated or have
assets, stockholders, executive offices or places of business in those states.
In EDGAR V. MITE CORP., the Supreme Court of the United States invalidated on
constitutional grounds the Illinois Business Takeover Act, which, as a matter of
state securities law, made certain corporate acquisitions more difficult. In CTS
CORP. V. DYNAMICS CORP. OF AMERICA, however, the Supreme Court of the United
States held that a state may, as a matter of corporate law and, in particular,
those laws concerning corporate governance, constitutionally disqualify a
potential acquiror from voting on the
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affairs of a target corporation without prior approval of the remaining
stockholders, provided that the laws were applicable only under certain
conditions.
Section 203 of the DGCL limits the ability of a Delaware corporation to
engage in business combinations with "interested stockholders" (defined as any
beneficial owner of 15% or more of the outstanding voting stock of the
corporation) unless, among other things, the corporation's board of directors
has given its prior approval of either the business combination or the
transaction which resulted in the stockholder becoming an "interested
stockholder." Company has represented in the Merger Agreement that Section 203
of the DGCL is not applicable to the Merger Agreement and the transactions
contemplated thereby, including the Offer and the Merger.
Based on information supplied by Company and Company's representations in
the Merger Agreement, Purchaser does not believe that any other state takeover
statutes apply to the Offer or the Merger. Neither Purchaser nor Parent has
currently complied with any state takeover statute or regulation. Purchaser
reserves the right to challenge the applicability or validity of any state law
purportedly applicable to the Offer or the Merger and nothing in this Offer to
Purchase or any action taken in connection with the Offer or the Merger is
intended as a waiver of that right. If it is asserted that any state takeover
statute is applicable to the Offer or the Merger and an appropriate court does
not determine that it is inapplicable or invalid as applied to the Offer or the
Merger, Purchaser might be required to file certain information with, or to
receive approvals from, the relevant state authorities, and Purchaser might be
unable to accept for payment or pay for Shares tendered pursuant to the Offer,
or be delayed in consummating the Offer or the Merger. In such case, Purchaser
may not be obligated to accept for payment or pay for any Shares tendered
pursuant to the Offer.
ANTITRUST. Under the provisions of the HSR Act applicable to the Offer, the
purchase of Shares under the Offer may be consummated following the expiration
of a 15-calendar-day waiting period following the filing by Purchaser of a
Notification and Report Form with respect to the Offer, unless Purchaser
receives a request for additional information or documentary material from the
Antitrust Division or the Federal Trade Commission (the "FTC") or unless early
termination of the waiting period is granted. As of the date of this Offer to
Purchase, it was expected that such filing would be made on or about January 25,
1999 and such waiting period would expire at 11:59 p.m. on or about February 9,
1999. If, within the initial 15-day waiting period, either the Antitrust
Division or the FTC requests additional information or documentary material from
Purchaser concerning the Offer, the waiting period will be extended and would
expire 11:59 p.m., New York City time, on the tenth calendar day after the date
of substantial compliance by Purchaser with such request. Only one extension of
the waiting period pursuant to a request for additional information is
authorized by the HSR Act. Thereafter, the waiting period may be extended only
by court order or with the consent of Purchaser. In practice, complying with a
request for additional information or documentary material can take a
significant amount of time. In addition, if the Antitrust Division or the FTC
raises substantive issues in connection with a proposed transaction, the parties
frequently engage in negotiations with the relevant governmental agency
concerning possible means of addressing those issues and may agree to delay
consummation of the transaction while the negotiations continue. For information
regarding the obligations of Company, Parent and Purchaser in this regard, see
"The Merger Agreement--Consents, Approvals and Filings" in Section 12.
The FTC and the Antitrust Division frequently scrutinize the legality under
the antitrust laws of transactions such as Purchaser's proposed acquisition of
Company. At any time before or after Purchaser's purchase of Shares pursuant to
the Offer, the Antitrust Division or the FTC could take such action under the
antitrust laws as it deems necessary or desirable in the public interest,
including seeking to enjoin the purchase of Shares pursuant to the Offer or the
consummation of the Merger or seeking the divestiture of Shares acquired by
Purchaser or the divestiture of substantial assets of Purchaser or its
subsidiaries, or Company or its subsidiaries. Private parties may also bring
legal action under the antitrust laws under certain circumstances. There can be
no assurance that a challenge to the
34
<PAGE>
Offer on antitrust grounds will not be made or, if such a challenge is made, of
the result of that challenge. See Section 14 for certain conditions to the
Offer, including conditions with respect to litigation.
16. FEES AND EXPENSES
Parent has retained Goldman, Sachs & Co. to act as the Dealer Managers and
to provide certain financial advisory services, D.F. King & Co., Inc. to act as
the Information Agent and First Chicago Trust Company of New York to act as the
Depositary in connection with the Offer. The Dealer Managers and the Information
Agent may contact holders of Shares by mail, telephone, telex, telegraph and
personal interview and may request brokers, dealers, commercial banks, trust
companies and other nominees to forward the Offer materials to beneficial
owners. The Dealer Managers, the Information Agent and the Depositary each will
receive reasonable and customary compensation for their services, will be
reimbursed for certain reasonable out-of-pocket expenses and will be indemnified
against certain liabilities and expenses in connection therewith, including
certain liabilities under the federal securities laws. Neither Parent nor
Purchaser will pay any fees or commissions to any broker or dealer or other
person for soliciting tenders of Shares pursuant to the Offer. Brokers, dealers,
commercial banks and trust companies will be reimbursed by Purchaser for
reasonable expenses incurred by them in forwarding material to their customers.
17. MISCELLANEOUS
The Offer is not being made to (nor will tenders be accepted from or on
behalf of) Stockholders residing in any jurisdiction in which the making of the
Offer or the acceptance thereof would not be in compliance with the securities,
blue sky or other laws of the jurisdiction. However, Purchaser may, in its
discretion, take such action as it may deem necessary to make the Offer in any
jurisdiction and extend the Offer to Stockholders in that jurisdiction. In any
jurisdiction where the securities, blue sky or other laws require the Offer to
be made by a licensed broker or dealer, the Offer will be deemed to be made on
behalf of Purchaser by the Dealer Managers or one or more registered brokers or
dealers that are licensed under the laws of the jurisdiction.
Purchaser has filed with the Commission the Schedule 14D-1 pursuant to Rule
14d-1 under the Exchange Act containing certain additional information with
respect to the Offer. The Schedule and any amendments to the Schedule, including
exhibits, may be examined and copies may be obtained from the principal office
of the Commission in the manner set forth in Section 8 above (except that they
will not be available at the regional offices of the Commission).
No person has been authorized to give any information or to make any
representation on behalf of Purchaser not contained in this Offer to Purchase or
in the Letter of Transmittal and, if given or made, the information or
representation must not be relied upon as having been authorized.
35
<PAGE>
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF PURCHASER AND PARENT
A. DIRECTORS AND EXECUTIVE OFFICERS OF PURCHASER
The directors of Purchaser are Mark A. Suwyn, Curtis M. Stevens and J. Ray
Barbee. The executive officers of Purchaser are Mark A. Suwyn, J. Ray Barbee,
Joseph Kastelic, Curtis M. Stevens, William Hebert, Anton C. Kirchhof and Gary
C. Wilkerson. Each of the directors and executive officers of Purchaser is also
an executive officer of Parent. Information concerning the name, present
principal occupation or employment and material occupation, positions, offices
or employment for the past five years of each director and executive officer of
Purchaser is set forth in the table of the directors and executive officers of
Parent. The business address of each such person is 111 S.W. Fifth Avenue,
Portland, Oregon 97204. All directors and officers of Purchaser are citizens of
the United States.
B. DIRECTORS AND EXECUTIVE OFFICERS OF PARENT
The following table sets forth the name, present principal occupation or
employment and material occupations, positions, offices or employment for the
past five years of each director and executive officer of Parent and Purchaser.
Unless otherwise indicated below, (i) each individual has held his or her
positions for more than the past five years and (ii) the business address of
each person is 111 S.W. Fifth Avenue, Portland, Oregon 97204. Except as
otherwise stated below, all directors and officers listed below are citizens of
the United States. Directors are identified with a single asterisk.
<TABLE>
<CAPTION>
AGE AT PRESENT PRINCIPAL OCCUPATION OR PERIOD
NAME AND ADDRESS 12/31/98 EMPLOYMENT AND FIVE-YEAR EMPLOYMENT HISTORY SERVED
- ------------------------ ------------- --------------------------------------------- ------------
<S> <C> <C> <C>
*Mark A. Suwyn.......... 56 Chairman of the Board and Chief Executive Since 1996
Officer of Parent
Executive Vice President of International 1992-1995
Paper Company (2 Manhattanville Rd.,
Purchase, NY 10577)
J. Ray Barbee........... 51 Vice President, Sales and Marketing of Parent Since 1998
Director of Market Pulp Operations of Parent 1997
Vice President and General Sales Manager of 1989-1997
Boise Cascade Corporation (1111 W. Jefferson
Street, Boise, ID 83728)
*John W. Barter......... 51 Private investor Since 1998
51 Society St. Executive Vice President of Allied Signal, 1994-1997
Charleston, SC Inc. and President of Allied Signal
29401 Automotive (101 Columbia Rd., Morristown, NJ
07962-1057). 1988-1994
Senior Vice President and Chief Financial
Officer of Allied Signal, Inc.
*William C. Brooks...... 65 Chairman, Brooks Group International, Ltd. Since 1997
1239 Washington Blvd. Vice President, Corporate Affairs of General Prior to
Detriot, MI 48226 Motors Corporation (100 Renaissance Center, 1997
Detroit, MI 48243)
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
AGE AT PRESENT PRINCIPAL OCCUPATION OR PERIOD
NAME AND ADDRESS 12/31/98 EMPLOYMENT AND FIVE-YEAR EMPLOYMENT HISTORY SERVED
- ------------------------ ------------- --------------------------------------------- ------------
<S> <C> <C> <C>
*Archie W. Dunham....... 59 Chief Executive Officer and President of
600 N. Dairy Ashford Rd. Conoco, Inc. and director of E.I. du Pont de
Houston, TX 77079 Nemours and Company (1007 Market St.,
Wilmington, DE 19898); Various other senior
executive positions with Conoco, Inc.
*Pierre S. du Pont IV... 63 Partner in the law firm of Richards, Layton &
One Rodney Square Finger
920 King St.
Wilmington, DE 19801
Warren C. Easley........ 56 Vice President, Technology and Quality of Since 1996
Parent 1992-1996
Technical Manager, North American Nylon, E.I.
du Pont de Nemours (1007 Market St.,
Wilmington, DE 19898)
Richard W. Frost........ 46 Vice President, Timberlands and Fiber Since 1996
Procurement of Parent 1992-1996
Vice President of S.D. Warren Company (225
Franklin Street, Boston, MA 02110)
*Bonnie G. Hill......... 57 President and Chief Executive Officer of the
Times Mirror Sq. Times Mirror Foundation and Vice President of
Los Angeles, CA Times Mirror Company and Senior Vice
90012 President, Communications and Public Affairs
for the Los Angeles Times
Dean of the McIntire School of Commerce at 1992-1997
the University of Virginia (Charlottesville,
Virginia 22903)
*Donald R. Kayser....... 68 Chairman and Chief Executive Officer of 1995-1996
4909 Roberts Road Parent Prior to
Boise, ID 83705 Retired 1995
J. Keith Matheney....... 49 Vice President, Core Businesses of Parent Since 1998
Vice President, Sales and Marketing of Parent 1997-1998
General Manager--Sales and Marketing of 1996
Parent
General Manager--Western Division of Parent 1996
General Manager--Weather-Seal Division of 1994-1996
Parent
Director of Sales and Marketing--Northern 1986-1994
Division of Parent
*Patrick F. McCartan.... 63 Managing partner of the law firm of Jones,
North Point Day, Reavis & Pogue
901 Lakeside Avenue
Cleveland, Ohio 44114
</TABLE>
I-2
<PAGE>
<TABLE>
<CAPTION>
AGE AT PRESENT PRINCIPAL OCCUPATION OR PERIOD
NAME AND ADDRESS 12/31/98 EMPLOYMENT AND FIVE-YEAR EMPLOYMENT HISTORY SERVED
- ------------------------ ------------- --------------------------------------------- ------------
<S> <C> <C> <C>
*Lee C. Simpson......... 64 President and Chief Operating Officer of 1995-1996
#12 Loon Lane Parent
Sunriver, OR 97707
Curtis M. Stevens....... 46 Vice President, Chief Financial Officer and Since 1997
Treasurer of Parent
Executive Vice President of Planar Systems 1983-1997
(1400 N.W. Compton Drive, Beaverton, OR
97006)
Michael J. Tull......... 53 Vice President, Human Resources of Parent Since 1996
Corporate Vice President, Employee Quality 1991-1996
and Development of Sharp Healthcare (3556
Ruffin Road, Bldg. B, San Diego, CA 92123)
Gary C. Wilkerson....... 52 Vice President and General Counsel of Parent Since 1997
Acting Senior Vice President, General Counsel 1997
and Secretary of the Consumer Operations
Division of Ivax Pharmaceuticals (4400
Biscayne Blvd., Miami, FL 33137)
Vice President, General Counsel and Secretary 1990-1996
of Maybelline, Inc. (3030 Jackson Avenue,
Memphis, TN 38112)
</TABLE>
I-3
<PAGE>
Manually signed facsimile copies of the Letter of Transmittal, properly
completed and duly signed, will be accepted. The Letter of Transmittal,
certificates for Shares and any other required documents should be sent or
delivered by each Stockholder of Company or his broker dealer, commercial bank,
trust company or other nominee to the Depositary, at one of the addresses set
forth below:
THE DEPOSITARY FOR THE OFFER IS:
First Chicago Trust Company of New York
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
First Chicago Trust Company First Chicago Trust Company of First Chicago Trust Company of
of New York New York New York
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
Suite 4660 14 Wall Street c/o Securities Transfer &
P.O. Box 2569 8th Floor, Suite 4680 Reporting Services, Inc.
Jersey City, NJ 07303-2569 New York, NY 10005 100 William Street, Galleria
New York, NY 10038
</TABLE>
Questions and requests for assistance may be directed to the Information
Agent or the Dealer Managers at their respective addresses and telephone numbers
listed below. Additional copies of this Offer to Purchase, the Letter of
Transmittal and other tender offer materials may be obtained from the
Information Agent as set forth below and will be furnished promptly at
Purchaser's expense. You may also contact your broker, dealer, commercial bank,
trust company or other nominee for assistance concerning the Offer.
THE INFORMATION AGENT FOR THE OFFER IS:
D.F. KING & CO., INC.
77 Water Street
New York, New York 10005
Banks and Brokerage Firms Call Collect: (212) 425-1685
ALL OTHERS CALL TOLL-FREE: (800) 290-6429
The Dealer Managers for the Offer are:
GOLDMAN, SACHS & CO.
85 Broad Street
New York, New York 10004
(800) 323-5678
<PAGE>
LETTER OF TRANSMITTAL
TO TENDER SHARES OF COMMON STOCK
OF
ABT BUILDING PRODUCTS CORPORATION
PURSUANT TO THE OFFER TO PURCHASE
DATED JANUARY 25, 1999
OF
STRIPER ACQUISITION, INC.
A WHOLLY OWNED SUBSIDIARY
OF
LOUISIANA-PACIFIC CORPORATION
- ---------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON TUESDAY, FEBRUARY 23, 1999, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
THE DEPOSITARY FOR THE OFFER IS:
First Chicago Trust Company of New York
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
First Chicago Trust Company First Chicago Trust Company First Chicago Trust Company
of New York of New York of New York
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
Suite 4660 14 Wall Street c/o Securities Transfer &
P.O. Box 2569 8th Floor, Suite 4680 Reporting Services, Inc.
Jersey City, NJ 07303-2569 New York, NY 10005 100 William Street, Galleria
New York, NY 10038
</TABLE>
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
----------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES)
OF REGISTERED HOLDER(S)
(PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S)
APPEAR(S) ON THE CERTIFICATES ENCLOSED
CERTIFICATE(S)) (ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
- ------------------------------------------------------------------------------------------------------
TOTAL NUMBER
OF SHARES NUMBER OF
CERTIFICATE REPRESENTED BY SHARES
NUMBER(S)* CERTIFICATE(S) TENDERED**
----------------------------------------------
----------------------------------------------
----------------------------------------------
----------------------------------------------
----------------------------------------------
----------------------------------------------
<S> <C> <C> <C>
TOTAL NUMBER
OF SHARES
<CAPTION>
----------------------------------------------------
<S> <C> <C> <C>
* NEED NOT BE COMPLETED BY STOCKHOLDERS DELIVERING SHARES BY BOOK-ENTRY TRANSFER THROUGH THE
DEPOSITARY.
** UNLESS OTHERWISE INDICATED, IT WILL BE ASSUMED THAT ALL SHARES REPRESENTED BY CERTIFICATES
DELIVERED TO THE DEPOSITARY ARE BEING TENDERED. SEE INSTRUCTION 4.
<CAPTION>
- ------------------------------------------------------------------------------------------------------
</TABLE>
<PAGE>
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE OR TRANSMISSION OF INSTRUCTIONS WILL NOT CONSTITUTE A VALID DELIVERY. YOU
MUST SIGN THIS LETTER OF TRANSMITTAL IN THE APPROPRIATE SPACE THEREFOR PROVIDED
BELOW AND COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
This Letter of Transmittal is to be completed by holders of Shares (as
defined below) of ABT Building Products Corporation ("Stockholders") if
certificates evidencing Shares ("Certificates") are to be forwarded with this
Letter of Transmittal or, unless an Agent's Message (as defined in the Offer to
Purchase) is utilized, if delivery of Shares is to be made by book-entry
transfer to an account maintained by First Chicago Trust Company of New York
(the "Depositary") at The Depository Trust Company (the "Book-Entry Transfer
Facility") pursuant to the procedures set forth in Section 3 of the Offer to
Purchase (as defined below).
Stockholders whose Certificates are not immediately available or who cannot
deliver either their Certificates for, or a Book-Entry Confirmation (as defined
in Section 3 of the Offer to Purchase) with respect to, their Shares and all
other required documents to the Depositary prior to the Expiration Date (as
defined in Section 1 of the Offer to Purchase) may tender their Shares according
to the guaranteed delivery procedures set forth in Section 3 of the Offer to
Purchase. See Instruction 2 hereof. Delivery of documents to the Book-Entry
Transfer Facility does not constitute delivery to the Depositary.
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
MADE TO AN ACCOUNT MAINTAINED BY THE DEPOSITARY WITH THE BOOK-ENTRY TRANSFER
FACILITY, AND COMPLETE THE FOLLOWING (ONLY PARTICIPANTS IN THE BOOK-ENTRY
TRANSFER FACILITY MAY DELIVER SHARES BY BOOK-ENTRY TRANSFER).
Name of Tendering Institution: _____________________________________________
Account Number: ____________________________________________________________
Transaction Code Number: ___________________________________________________
/ / CHECK HERE IF SHARES ARE BEING TENDERED PURSUANT TO A NOTICE OF GUARANTEED
DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING.
PLEASE ENCLOSE A PHOTOCOPY OF SUCH NOTICE OF GUARANTEED DELIVERY.
Name(s) of Registered Stockholder(s): ______________________________________
Window Ticket Number (if any): _____________________________________________
Date of Execution of Notice of Guaranteed Delivery: ________________________
Name of Institution which Guaranteed Delivery: _____________________________
Account Number: ____________________________________________________________
Transaction Code Number: ___________________________________________________
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
2
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Striper Acquisition, Inc., a Delaware
corporation (the "Purchaser") and a wholly owned subsidiary of Louisiana-Pacific
Corporation, a Delaware corporation ("Parent"), the above-described shares of
common stock, par value $0.01 per share (the "Shares"), of ABT Building Products
Corporation, a Delaware corporation (the "Company"), at a purchase price of
$15.00 per Share, net to the seller in cash, without interest, upon the terms
and subject to the conditions set forth in the Offer to Purchase, dated January
25, 1999 (the "Offer to Purchase"), receipt of which is hereby acknowledged, and
in this Letter of Transmittal (which, together with any amendments or
supplements hereto or thereto, collectively constitute the "Offer"). The
undersigned understands that Purchaser reserves the right to transfer or assign,
in whole or from time to time in part, to one or more direct or indirect wholly
owned subsidiary of Parent, the right to purchase all or any portion of the
Shares tendered pursuant to the Offer, but any such transfer or assignment will
not relieve Purchaser of its obligations under the Offer or prejudice the rights
of the tendering Stockholders to receive payment for Shares validly tendered and
accepted for payment pursuant to the Offer.
Subject to, and effective upon, acceptance for payment of, or payment for,
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms or conditions of any such extension or amendment), the undersigned hereby
sells, assigns, and transfers to, or upon the order of, Purchaser all right,
title and interest in and to all of the Shares that are being tendered hereby
and any and all other Shares or other securities issued or issuable in respect
thereof on or after January 25, 1999 (a "Distribution") and irrevocably
constitutes and appoints the Depositary the true and lawful agent and
attorney-in-fact of the undersigned with respect to such Shares (and any
Distributions), with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest), to (i) deliver
Certificates evidencing such Shares (and any Distributions), or transfer
ownership of such Shares (and any Distributions) on the account books maintained
by the Book-Entry Transfer Facility, together, in any such case, with all
accompanying evidences of transfer and authenticity to, or upon the order of,
Purchaser, upon receipt by the Depositary as the undersigned's agent, of the
purchase price with respect to such Shares, (ii) present such Shares (and any
Distributions) for transfer on the books of the Company, and (iii) receive all
benefits and otherwise exercise all rights of beneficial ownership of such
Shares (and any Distributions), all in accordance with the terms and subject to
the conditions of the Offer.
The undersigned hereby irrevocably appoints each designee of Purchaser as
the attorney-in-fact and proxy of the undersigned, each with full power of
substitution and resubstitution, to the full extent of the undersigned's rights
with respect to all Shares tendered herewith and accepted for payment and paid
for by Purchaser (and any Distributions), including without limitation the right
to vote such Shares (and any Distributions) in such manner as each such attorney
and proxy or his substitute shall, in his sole discretion, deem proper. All such
powers of attorney and proxies, being deemed to be irrevocable, shall be
considered coupled with an interest in the Shares tendered with this Letter of
Transmittal. Such appointment will be effective when, and only to the extent
that, Purchaser accepts such Shares for payment. Upon such acceptance for
payment, all prior powers of attorney and proxies given by the undersigned with
respect to such Shares (and any Distributions) will be revoked, without further
action, and no subsequent powers of attorneys and proxies may be given with
respect thereto (and, if given, will be deemed ineffective). The designees of
Purchaser will, with respect to the Shares (and any Distributions) for which
such appointment is effective, be empowered to exercise all voting and other
rights of the undersigned with respect to such Shares (and any Distributions) as
they in their sole discretion may deem proper. Purchaser reserves the absolute
right to require that, in order for Shares to be deemed validly tendered,
immediately upon the acceptance for payment of such Shares, Purchaser or its
designees be able to exercise full voting rights with respect to such Shares
(and any Distributions), including voting at any meeting of Stockholders then
scheduled.
All authority conferred or agreed to be conferred in this Letter of
Transmittal shall be binding upon the successors, assigns, heirs, executors,
administrators and legal representatives of the undersigned and shall not be
affected by, and shall survive, the death or incapacity of the undersigned.
Except as stated in the Offer to Purchase, this tender is irrevocable.
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, sell, assign and transfer the Shares tendered
hereby (and any Distributions) and that, when the same are accepted for payment
and paid for by Purchaser, Purchaser will acquire good, marketable and
unencumbered title thereto, free and clear of all liens, restrictions, charges
and encumbrances, and that the Shares tendered hereby (and any Distributions)
will not be subject to any adverse claim. The undersigned, upon request, will
execute and deliver any additional documents deemed by the Depositary or
Purchaser to be necessary or desirable to complete the sale,
3
<PAGE>
assignment and transfer of Shares tendered hereby (and any Distributions). In
addition, the undersigned shall promptly remit and transfer to the Depositary
for the account of Purchaser any and all Distributions issued to the undersigned
on or after January 25, 1999 in respect of the Shares tendered hereby,
accompanied by appropriate documentation of transfer, and pending such
remittance and transfer or appropriate assurance thereof, the Purchaser shall be
entitled to all rights and privileges as owner of any such Distributions and may
withhold the entire purchase price or deduct from the purchase price the amount
of value thereof, as determined by Purchaser in its sole discretion.
The undersigned understands that the valid tender of Shares pursuant to any
one of the procedures described in Section 3 of the Offer to Purchase and in the
instructions to this Letter of Transmittal will constitute a binding agreement
between the undersigned and the Purchaser with respect to such Shares upon the
terms and subject to the conditions of the Offer.
The undersigned recognizes that, under certain circumstances set forth in
the Offer to Purchase, the Purchaser may not be required to accept for payment
any of the Shares tendered hereby.
Unless otherwise indicated in this Letter of Transmittal under "Special
Payment Instructions," please issue the check for the purchase price and return
any Certificates evidencing Shares not tendered or not accepted for payment in
the name(s) of the registered holder(s) appearing under "Description of Shares
Tendered." Similarly, unless otherwise indicated under "Special Delivery
Instructions," please mail the check for the purchase price and return any
Certificates evidencing Shares not tendered or not accepted for payment (and
accompanying documents, as appropriate) to the address(es) of the registered
holder(s) appearing under "Description of Shares Tendered." In the event that
both the "Special Payment Instructions" and the "Special Delivery Instructions"
are completed, please issue the check for the purchase price and return any such
Certificates evidencing Shares not tendered or not accepted for payment (and
accompanying documents, as appropriate) in the name(s) of, and deliver such
check and return such Certificates (and accompanying documents, as appropriate)
to, the person(s) so indicated. Unless otherwise indicated herein under "Special
Payment Instructions," in the case of book-entry delivery of Shares, please
credit the account maintained at the Book-Entry Transfer Facility indicated
above with respect to any Shares not accepted for payment. The undersigned
recognizes that Purchaser has no obligation pursuant to the "Special Payment
Instructions" to transfer any Shares from the name of the registered holder if
the Purchaser does not accept for payment any of the Shares tendered hereby.
4
<PAGE>
- ------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if Certificates for Shares not tendered or not
accepted for payment and/or the check for the payment and the check for the
purchase price of Shares accepted for payment are to be issued in the name
of someone other than the undersigned, or if Shares delivered by book-entry
transfer that are not accepted for payment are to be returned by credit to
an account maintained at the Book-Entry Transfer Facility other than the
account indicated above.
Issue check and certificate(s) to:
Name(s):____________________________________________________________________
____________________________________________________________________________
(PLEASE TYPE OR PRINT)
Address: ___________________________________________________________________
____________________________________________________________________________
(INCLUDE ZIP CODE)
____________________________________________________________________________
(TAX IDENTIFICATION OR SOCIAL SECURITY NO.)
(ALSO COMPLETE SUBSTITUTE FORM W-9 ON THE REVERSE SIDE OF THIS FORM.)
- ------------------------------------------------------------
- ------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if Certificates for Shares not tendered or not
accepted for payment and/or the check for the purchase price of Shares
accepted for payment are to be sent to someone other than the undersigned or
to the undersigned at an address other than that shown above.
Mail check and certificate(s) to:
Name: ______________________________________________________________________
____________________________________________________________________________
(PLEASE TYPE OR PRINT)
Address: ___________________________________________________________________
____________________________________________________________________________
(INCLUDE ZIP CODE)
- ------------------------------------------
5
<PAGE>
- --------------------------------------------------------------------------------
IMPORTANT:
STOCKHOLDER: SIGN HERE AND COMPLETE SUBSTITUTE
FORM W-9 ON THE REVERSE SIDE OF THIS FORM
____________________________________________________________________________
____________________________________________________________________________
SIGNATURE(S) OF STOCKHOLDER(S)
Dated: _____________, 1999
(MUST BE SIGNED BY THE REGISTERED HOLDER(S) EXACTLY AS NAME(S) APPEAR(S)
ON THE CERTIFICATE OR ON A SECURITY POSITION LISTING OR BY PERSON(S)
AUTHORIZED TO BECOME REGISTERED HOLDER(S) BY CERTIFICATES AND DOCUMENTS
TRANSMITTED HEREWITH. IF SIGNATURE IS BY TRUSTEES, EXECUTORS,
ADMINISTRATORS, GUARDIANS, ATTORNEYS-IN-FACT, AGENTS, OFFICERS OR
CORPORATIONS OR OTHERS ACTING IN A FIDUCIARY OR REPRESENTATIVE CAPACITY,
PLEASE PROVIDE THE FOLLOWING INFORMATION. SEE INSTRUCTION 5.)
Name: ______________________________________________________________________
(PLEASE TYPE OR PRINT)
Capacity (Full Title): _____________________________________________________
Address: ___________________________________________________________________
____________________________________________________________________________
(INCLUDE A ZIP CODE)
Area Code and Telephone No.: _______________________________________________
(HOME)
_____________________________________
(BUSINESS)
Tax Identification or
Social Security No. ______________________________________________________
(COMPLETE SUBSTITUTE FORM W-9 BELOW)
GUARANTEE OF SIGNATURE(S)
(SEE INSTRUCTIONS 1 AND 5)
Authorized Signature(s): ___________________________________________________
Name: ______________________________________________________________________
(PLEASE TYPE OR PRINT)
Title: _____________________________________________________________________
Name of Firm: ______________________________________________________________
Address: ___________________________________________________________________
____________________________________________________________________________
(INCLUDE ZIP CODE)
Area Code and Telephone No.: _______________________________________________
Dated: _____________, 1999
- --------------------------------------------------------------------------------
6
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. Except as otherwise provided below, no
signature guarantee is required on this Letter of Transmittal, (a) if this
Letter of Transmittal is signed by the registered holder(s) (which term, for the
purposes of this document, includes any participant in any of the Book-Entry
Transfer Facility systems whose name appears on a security position listing as
the owner of the Shares) of Shares tendered herewith and such registered holder
has not completed the box entitled "Special Payment Instructions" on this Letter
of Transmittal or (b) if such Shares are tendered for the account of a financial
institution (including most commercial banks, savings and loan associations and
brokerage houses) that is a participant in the Security Transfer Agents
Medallion Program (an "Eligible Institution"). In all other cases, all
signatures on the Letter of Transmittal must be guaranteed by an Eligible
Institution. See Instruction 5. If the Certificates are registered in the name
of a person other than the signer of this Letter of Transmittal or if payment is
to be made or Certificates for Shares not tendered or not accepted for payment
are to be returned to a person other than the registered holder of the
Certificates tendered, then the tendered Certificates must be endorsed or
accompanied by duly executed stock powers, in either case signed exactly as the
name or names of the registered owner or owners appear on the Certificates, with
the signatures on the Certificates or stock powers guaranteed by an Eligible
Institution as provided in this Letter of Transmittal. See Instruction 5.
2. REQUIREMENTS OF TENDER. This Letter of Transmittal is to be completed by
Stockholders if Certificates evidencing Shares are to be forwarded with this
Letter of Transmittal or, unless an Agent's Message is utilized, if delivery of
Shares is to be made pursuant to the procedures for book-entry transfer set
forth in Section 3 of the Offer to Purchase. For Shares to be validly tendered
pursuant to the Offer, either (a) a Letter of Transmittal (or a manually signed
facsimile thereof), properly completed and duly executed, with any required
signature guarantees (or, in the case of a book-entry transfer of Shares, an
Agent's Message (as defined in Section 3 of the Offer to Purchase)), and any
other documents required by this Letter of Transmittal, must be received by the
Depositary at one of its addresses set forth in this Letter of Transmittal prior
to the Expiration Date and either (i) Certificates representing tendered Shares
must be received by the Depositary at one of those addresses prior to the
Expiration Date or (ii) Shares must be delivered pursuant to the procedures for
book-entry transfer set forth in Section 3 of the Offer to Purchase and a
Book-Entry Confirmation must be received by the Depositary prior to the
Expiration Date, or (b) the tendering Stockholder must comply with the
guaranteed delivery procedures set forth below and in Section 3 of the Offer to
Purchase.
Stockholders whose Certificates are not immediately available or who cannot
deliver their Certificates and all other required documents to the Depositary or
complete the procedures for book-entry transfer prior to the Expiration Date may
nevertheless tender their Shares by following the guaranteed delivery procedures
set forth in Section 3 of the Offer to Purchase. Pursuant to such procedure: (i)
tender must be made by or through an Eligible Institution, (ii) a properly
completed and duly executed Notice of Guaranteed Delivery, substantially in the
form made available by Purchaser, must be received by the Depositary on or prior
to the Expiration Date, and (iii) Certificates representing all tendered Shares
in proper form for transfer, or a Book-Entry Confirmation with respect to all
the tendered Shares, together with a Letter of Transmittal (or a manually signed
facsimile thereof), properly completed and duly executed, and any required
signature guarantees (or, in the case of a book-entry transfer of Shares, an
Agent's Message), and any other documents required by this Letter of
Transmittal, must be received by the Depositary within three New York Stock
Exchange trading days after the date of such Notice of Guaranteed Delivery. If
Certificates are forwarded separately to the Depositary, a properly completed
and duly executed Letter of Transmittal (or a manually signed facsimile thereof)
must accompany each delivery.
The method of delivery of Certificates, this Letter of Transmittal and any
other required documents is at the option and sole risk of the tendering
Stockholder and delivery will be deemed made only when actually received by the
Depositary. If delivery is by mail, registered mail with return receipt
requested, properly insured, is recommended. In all cases, sufficient time
should be allowed to ensure timely delivery.
No alternative, conditional or contingent tenders will be accepted and no
fractional Shares will be purchased. All tendering Stockholders, by execution of
this Letter of Transmittal (or a manually signed facsimile thereof), waive any
right to receive any notice of the acceptance of their Shares for payment.
3. INADEQUATE SPACE. If the space provided in this Letter of Transmittal is
inadequate, the information required under "Description of Shares Tendered"
should be listed on a separate signed schedule attached to this Letter of
Transmittal.
7
<PAGE>
4. PARTIAL TENDERS. If fewer than all of the Shares represented by any
Certificates delivered to the Depositary with this Letter of Transmittal are to
be tendered, fill in the number of Shares which are to be tendered in the box
entitled "Number of Shares Tendered." In such cases, a new Certificate for the
remainder of the Shares that were evidenced by your old Certificate(s) will be
sent, without expense, to the person(s) signing this Letter of Transmittal,
unless otherwise provided in the box entitled "Special Payment Instructions" or
the box entitled "Special Delivery Instructions" on this Letter of Transmittal,
as soon as practicable after the Expiration Date. All Shares evidenced by
Certificate(s) delivered to the Depositary will be deemed to have been tendered
unless otherwise indicated.
5. SIGNATURES ON LETTER OF TRANSMITTAL, INSTRUMENTS OF TRANSFER AND
ENDORSEMENTS. If this Letter of Transmittal is signed by the registered
holder(s) of the Shares tendered hereby, the signature(s) must correspond
exactly with the name(s) as written on the face of the Certificate(s) without
alteration, enlargement or any change whatsoever.
If any of the Shares tendered hereby are owned of record by two or more
joint owners, all the owners must sign this Letter of Transmittal.
If any of the tendered Shares are registered in different names on several
Certificates, it will be necessary to complete, sign and submit as many separate
Letters of Transmittal as there are different registrations of Certificates.
If this Letter of Transmittal or any Certificates or instruments of transfer
are signed by a trustee, executor, administrator, guardian, attorney-in-fact,
officer of a corporation or other person acting in a fiduciary or representative
capacity, that person should so indicate when signing, and proper evidence
satisfactory to the Purchaser of that person's authority to so act must be
submitted.
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares listed and transmitted hereby, no endorsements of Certificates or
separate instruments of transfer are required unless payment is to be made, or
Certificates not tendered or not purchased are to be issued or returned, to a
person other than the registered holder(s). Signatures on the Certificates or
instruments of transfer must be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares evidenced by the Certificate(s) listed and
transmitted hereby, the Certificate(s) must be endorsed or accompanied by
appropriate instruments of transfer, in either case signed exactly as the
name(s) of the registered holder(s) appear on the Certificates for such Shares.
Signatures on the Certificates or instruments of transfer must be guaranteed by
an Eligible Institution.
6. TRANSFER TAXES. Except as set forth in this Instruction 6, the Purchaser
will pay or cause to be paid any transfer taxes with respect to the transfer and
sale of Shares to it or its order pursuant to the Offer. If, however, payment of
the purchase price is to be made to, or (in the circumstances permitted hereby)
if Certificates for Shares not tendered or not purchased are to be registered in
the name of, any person other than the registered holder(s), or if tendered
Certificates are registered in the name of any person other than the person(s)
signing this Letter of Transmittal, the amount of any transfer taxes (whether
imposed on the registered holder(s) or such person) payable on account of the
transfer to such person will be deducted from the purchase price unless
satisfactory evidence of the payment of such taxes or exemption therefrom is
submitted.
Except as provided in this Instruction 6, it will not be necessary for
transfer tax stamps to be affixed to the Certificate(s) listed in this Letter of
Transmittal.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check and Certificates
for unpurchased Shares are to be issued in the name of a person other than the
signer of this Letter of Transmittal or if a check is to be sent and
Certificates are to be returned to someone other than the signer of this Letter
of Transmittal or to an address other than that shown above, the appropriate
boxes on this Letter of Transmittal should be completed. If any tendered Shares
are not purchased for any reason and the Shares are delivered by book-entry
transfer, the Shares will be credited to an account maintained at the Book-Entry
Transfer Facility.
8. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions and requests for
assistance may be directed to the Information Agent at its address or telephone
number set forth below. Requests for additional copies of the Offer to Purchase,
this Letter of Transmittal and the Notice of Guaranteed Delivery may be directed
to the Information Agent or to brokers, dealers, commercial banks and trust
companies. Such materials will be furnished at Purchaser's expense.
8
<PAGE>
9. WAIVER OF CONDITIONS. The conditions of the Offer may be waived by
Purchaser (subject to certain limitations in the Merger Agreement (as defined in
the Offer to Purchase)), in whole or in part, at any time or from time to time,
in Purchaser's sole discretion.
10. BACKUP WITHHOLDING TAX. Each tendering Stockholder is required to
provide the Depositary with a correct Taxpayer Identification Number ("TIN") on
Substitute Form W-9, which is provided under "Important Tax Information" below
and to certify that the Stockholder is not subject to backup withholding.
Failure to provide the information on the Substitute Form W-9 may subject the
tendering Stockholder to a penalty and 31% federal income tax backup withholding
on the payment of the purchase price for the Shares. If the tendering
Stockholder has not been issued a TIN and has applied for a TIN or intends to
apply for a TIN in the near future, the tendering Stockholder should follow the
instructions set forth in Part III of the Substitute Form W- 9 and sign and date
both the Substitute Form W-9 and the "Certificate of Awaiting Taxpayer
Identification." If the Stockholder has indicated in Part III that a TIN has
been applied for and the Depositary is not provided with a TIN by the time of
payment, the Depositary will withhold 31% of all payments of the purchase price,
if any, made thereafter pursuant to the Offer until a TIN is provided to the
Depositary.
11. LOST OR DESTROYED CERTIFICATES. If any Certificate(s) representing
Shares has been lost or destroyed, the holders should promptly notify the
Transfer Agent, Harris Trust Company, at (312) 461-6001. The holders will then
be instructed as to the procedure to be followed in order to replace the
Certificate(s). This Letter of Transmittal and related documents cannot be
processed until the procedures for replacing lost or destroyed Certificates have
been followed.
IMPORTANT: THIS LETTER OF TRANSMITTAL OR A MANUALLY SIGNED FACSIMILE,
TOGETHER WITH ANY REQUIRED SIGNATURE GUARANTEES (OR, IN THE CASE OF BOOK-ENTRY
TRANSFER, AN AGENT'S MESSAGE), TOGETHER WITH CERTIFICATES OR A BOOK-ENTRY
CONFIRMATION FOR SHARES AND ANY OTHER REQUIRED DOCUMENT, MUST BE RECEIVED BY THE
DEPOSITARY, OR A NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE
DEPOSITARY, PRIOR TO THE EXPIRATION DATE.
IMPORTANT TAX INFORMATION
Under current federal income tax law, a Stockholder whose tendered Shares
are accepted for payment is required to provide the Depositary (as payer) with
such Stockholder's correct TIN on Substitute Form W-9 below. If such Stockholder
is an individual, the TIN is his social security number. If the tendering
Stockholder has not been issued a TIN and has applied for a TIN or intends to
apply for a TIN in the near future, the Stockholder should so indicate on the
Substitute Form W-9. See Instruction 10. If the Depositary is not provided with
the correct TIN, the Stockholder may be subject to a $50 penalty imposed by the
Internal Revenue Service. In addition, payments that are made to the Stockholder
with respect to Shares purchased pursuant to the Offer may be subject to backup
federal income tax withholding.
Certain Stockholders (including, among others, all corporations and certain
foreign individuals) are not subject to these backup withholding and reporting
requirements and should indicate their status by writing "exempt" across the
face of, and by signing and dating, the Substitute Form W-9. In order for a
foreign individual to qualify as an exempt recipient, that Stockholder must
submit a statement, signed under penalties of perjury, attesting to that
individual's exempt status. Forms for such statements can be obtained from the
Depositary. See the enclosed Guidelines for Certificates of Taxpayer
Identification Number on Substitute Form W-9 for additional instructions.
If backup withholding applies, the Depositary is required to withhold 31% of
any payments made to the Stockholder. Backup withholding is not an additional
tax. Rather, the federal income tax liability of persons subject to backup
withholding will be reduced by the amount of tax withheld. If withholding
results in an overpayment of taxes, a refund may be obtained from the Internal
Revenue Service.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup federal income tax withholding with respect to payment of
the purchase price for Shares purchased pursuant to the Offer, a Stockholder
must provide the Depositary with his correct TIN by completing the Substitute
Form W-9 below, certifying that the TIN provided on Substitute Form W-9 is
correct (or that the Stockholder is awaiting a TIN) and that (i) such
Stockholder is exempt from backup withholding, (ii) the Stockholder has not been
notified by the Internal Revenue Service that he is subject to backup
withholding as a result of failure to report all interest or dividends, or (iii)
the Internal Revenue Service has notified the Stockholder that he is no longer
subject to backup withholding.
9
<PAGE>
WHAT NUMBER TO GIVE THE DEPOSITARY
The Stockholder is required to give the Depositary the social security
number or employer identification number of the record holder of the Shares
tendered hereby. If the Shares are registered in more than one name or are not
in the name of the actual owner, consult the enclosed Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional guidance on which number to report.
10
<PAGE>
PAYER'S NAME: FIRST CHICAGO TRUST COMPANY OF NEW YORK
<TABLE>
<C> <S> <C>
- --------------------------------------------------------------------------------------------------------------------------
SUBSTITUTE PART I--Taxpayer Identification Number--For Social security number
FORM W-9 All Accounts Enter P your taxpayer -------------------------
DEPARTMENT OF identification number in the appropriate box. OR
THE TREASURY For most individuals and sole proprietors, Employer Identification Number
INTERNAL REVENUE SERVICE this is your Social Security Number. For ------------------------
other entities, it is your Employer If awaiting TIN, write "
Identification Number. If you do not have a "Applied For".
number, see "How to Obtain a TIN" in the
enclosed GUIDELINES.
Note: if the account is in more than one
name, see the chart on page 2 of the enclosed
GUIDELINES to determine what number to enter.
--------------------------------------------
PART II--For Payees Exempt From Backup
Withholding (see enclosed GUIDELINES and
complete as instructed therein).
- --------------------------------------------------------------------------------------------------------------------------
PART III CERTIFICATION.--Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct taxpayer identification number, or I
PAYER'S REQUEST am waiting for a number to be issued to me and either (a) I have mailed or delivered
FOR TAXPAYER an application to receive a taxpayer identification number to the appropriate
IDENTIFICATION NUMBER Internal Revenue Service Center or Social Security Administration Office or (b) I
intend to mail or deliver an application in the near future. I understand that if
I do not provide a taxpayer identification number, 31% of all reportable payments
made to me thereafter will be withheld until I provide a number;
(2) I am not subject to backup withholding because (a) I am exempt from backup
withholding, or (b) I have not been notified by the Internal Revenue Service
("IRS") that I am subject to backup withholding as a result of a failure to
report all interest or dividends, or (c) the IRS has notified me that I am no
longer subject to backup withholding; and
(3) Any other information provided on this form is true, correct and complete.
CERTIFICATION INSTRUCTIONS--You must cross out item (2) above if you have been
notified by the IRS that you are currently subject to backup withholding because of
underreporting interest or dividends on your tax return. However, if after being
notified by the IRS that you were subject to backup withholding you received another
notification from the IRS that you are no longer subject to backup withholding, do not
cross out item (2).
--------------------------------------------------------------------------------------
SIGNATURE ------------------------- DATE-------------------, 1999
- --------------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW
THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR INSTRUCTIONS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU WROTE "APPLIED FOR" IN
THE BOX IN PART III OF THE SUBSTITUTE FORM W-9.
- --------------------------------------------------------------------------------
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalty of perjury that a taxpayer identification
number has not been issued to me, and either (1) I have mailed or delivered
an application to receive a taxpayer identification number to the
appropriate Internal Revenue Service Center or Social Security
Administration Office or (2) I intend to mail or deliver an application in
the near future. I understand that if I do not provide a taxpayer
identification number by the time of payment, 31% of all payments of the
purchase price pursuant to the Offer made to me thereafter will be
withheld until I provide a number.
<TABLE>
<S> <C>
SIGNATURE ------------------------------------- DATE ------------------, 1999
</TABLE>
- --------------------------------------------------------------------------------
11
<PAGE>
THE INFORMATION AGENT FOR THE OFFER IS:
D.F. KING & CO., INC.
77 Water Street
New York, New York 10005
Banks and Brokerage Firms, Call Collect: (212) 425-1685
ALL OTHERS CALLS TOLL FREE: (800) 290-6429
THE DEALER MANAGERS FOR THE OFFER ARE:
GOLDMAN, SACHS & CO.
85 Broad Street
New York, New York 10004
(800) 323-5678
<PAGE>
NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF SHARES OF COMMON STOCK
OF
ABT BUILDING PRODUCTS CORPORATION
(NOT TO BE USED FOR SIGNATURE GUARANTEES)
This Notice of Guaranteed Delivery, or one substantially equivalent to this
form, must be used to accept the Offer (as defined below) if certificates
representing shares of common stock, par value $0.01 per share (the "Shares"),
of ABT Building Products Corporation, a Delaware corporation, are not
immediately available or time will not permit all required documents to reach
First Chicago Trust Company of New York (the "Depositary") prior to the
Expiration Date (as defined in the Offer to Purchase), or the procedures for
delivery by book- entry transfer cannot be completed on a timely basis. This
Notice of Guaranteed Delivery may be delivered by hand or transmitted by
facsimile transmission or mailed to the Depositary. See Section 3 of the Offer
to Purchase.
THE DEPOSITARY FOR THE OFFER IS:
First Chicago Trust Company of New York
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
First Chicago Trust Company First Chicago Trust Company First Chicago Trust Company
of New York of New York of New York
Tenders & Exchanges Tenders & Exchanges Tenders & Exchanges
Suite 4660 14 Wall Street c/o Securities Transfer &
P.O. Box 2569 8th Floor, Suite 4680 Reporting Services, Inc.
Jersey City, NJ 07303-2569 New York, NY 10005 100 William Street, Galleria
New York, NY 10038
Telecopy: (201) 222-4720 or
(201) 222-4721
</TABLE>
To confirm facsimile transmission only:
(201) 222-4707
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE TRANSMISSION TO
A NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
This Notice of Guaranteed Delivery is not to be used to guarantee
signatures. If a signature on a Letter of Transmittal is required to be
guaranteed by an "Eligible Institution" under the instructions thereto, such
signature guarantee must appear in the applicable space provided in the
signature box on the Letter of Transmittal.
The Eligible Institution that completes this form must communicate the
guarantee to the Depositary and must deliver the Letter of Transmittal and
certificates for Shares to the Depositary within the time period shown herein.
Failure to do so could result in a financial loss to such Eligible Institution.
THE GUARANTEE ON THE REVERSE SIDE MUST BE COMPLETED.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Striper Acquisition, Inc., a Delaware
corporation and a wholly owned subsidiary of Louisiana-Pacific Corporation, a
Delaware corporation, upon the terms and subject to the conditions set forth in
the Offer to Purchase, dated January 25, 1999 (the "Offer to Purchase"), and the
related Letter of Transmittal (which, together with any amendments or
supplements thereto, collectively constitute the "Offer"), receipt of which is
hereby acknowledged, the number of Shares indicated below pursuant to the
guaranteed delivery procedures set forth in Section 3 of the Offer to Purchase.
- -------------------------------------------
Number of Shares: __________________________________________________________
Share Certificate Nos. (if available):
____________________________________________________________________________
____________________________________________________________________________
If Shares will be delivered by book-entry transfer, check the box:
/ / The Depository Trust Company
Account Number _____________________________________________________________
Dated: _______________________________________________________________, 1999
- -------------------------------------------
- -------------------------------------------
Name(s) of Record Holder(s): _______________________________________________
____________________________________________________________________________
PLEASE TYPE OR PRINT
Address(es) ________________________________________________________________
____________________________________________________________________________
ZIP CODE
Area Code and Telephone Number:
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
SIGNATURES(S)
- -----------------------------------------------------
THE GUARANTEE SET FORTH BELOW MUST BE COMPLETED.
GUARANTEE
(Not to be used for signature guarantee)
The undersigned, an Eligible Institution (as such term is defined in Section
3 of the Offer to Purchase), hereby guarantees to deliver to the Depositary at
one of its addresses set forth above (i) the certificates representing all
tendered Shares, in proper form for transfer, or a Book Entry Confirmation (as
defined in Section 3 of the Offer to Purchase) with respect to such Shares, (ii)
a Letter of Transmittal (or a manually signed facsimile thereof), properly
completed and duly executed, with all required signature guarantees, (or, in the
case of a book-entry transfer of Shares, an Agent's Message (as defined in
Section 3 of the Offer to Purchase)), and (iii) all other documents required by
the Letter of Transmittal, all within three New York Stock Exchange trading days
after the date hereof.
<TABLE>
<S> <C>
Name of Firm: AUTHORIZED SIGNATURE
Address: Name:
PLEASE TYPE OR PRINT
Title:
ZIP CODE
Area Code and
Tel. No.: Dated: , 1999
</TABLE>
NOTE: DO NOT SEND CERTIFICATES FOR SHARES WITH THIS NOTICE OF GUARANTEED
DELIVERY. CERTIFICATES FOR SHARES SHOULD BE DELIVERED ONLY WITH THE
LETTER OF TRANSMITTAL.
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
ABT BUILDING PRODUCTS CORPORATION
AT
$15.00 NET PER SHARE
BY
STRIPER ACQUISITION, INC.
A WHOLLY OWNED SUBSIDIARY
OF
LOUISIANA-PACIFIC CORPORATION
- ---------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON TUESDAY, FEBRUARY 23, 1999, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
To Brokers, Dealers, Commercial Banks, January 25, 1999
Trust Companies and Other Nominees:
We have been appointed by Striper Acquisition, Inc., a Delaware corporation
("Purchaser") and a wholly owned subsidiary of Louisiana-Pacific Corporation, a
Delaware corporation ("Parent"), to act as Dealer Managers in connection with
its offer to purchase all of the outstanding shares of common stock, par value
$0.01 per share (the "Shares"), of ABT Building Products Corporation, a Delaware
corporation (the "Company"), at $15.00 per Share, net to the seller in cash,
upon the terms and subject to the conditions set forth in Purchaser's Offer to
Purchase, dated January 25, 1999, and the related Letter of Transmittal (which,
together with any amendments or supplements thereto, collectively constitute the
"Offer"). Please furnish copies of the enclosed materials to those of your
clients for whose accounts you hold Shares in your name or in the name of your
nominee.
Enclosed herewith for your information and for forwarding to your clients
are copies of the following documents:
1. Offer to Purchase, dated January 25, 1999.
2. Letter of Transmittal to tender Shares for your use and for the
information of your clients, together with Guidelines of the Internal
Revenue Service for Certification of Taxpayer Identification Number on
Substitute Form W-9 providing information relating to backup federal income
tax withholding. Manually signed facsimile copies of the Letter of
Transmittal may be used to tender Shares.
3. A letter to stockholders of the Company from George T. Brophy,
Chairman and Chief Executive Officer of the Company, together with a
Solicitation/Recommendation Statement on Schedule 14D-9.
4. Notice of Guaranteed Delivery for Shares to be used to accept the
Offer if neither of the two procedures for tendering Shares set forth in the
Offer to Purchase can be completed on a timely basis.
5. A form of letter which may be sent to your clients for whose
accounts you hold Shares registered in your name or in the name of your
nominee, with space provided for obtaining such clients' instructions with
regard to the Offer.
6. Return envelope addressed to First Chicago Trust Company of New
York, the Depositary.
<PAGE>
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS
PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER AND WITHDRAWAL RIGHTS WILL
EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON TUESDAY, FEBRUARY 23, 1999,
UNLESS THE OFFER IS EXTENDED.
Please note the following:
1. The tender price is $15.00 per Share, net to the seller in cash.
2. The Offer is conditioned upon, among other things, there being
validly tendered and not properly withdrawn prior to the Expiration Date (as
defined in the Offer to Purchase) that number of Shares which (together with
any Shares then owned by Parent or any of its subsidiaries) constitutes a
majority of the Shares outstanding on a fully diluted basis on the date of
purchase. The Offer is also subject to certain other conditions. See Section
14 of the Offer to Purchase.
3. The Offer is being made for all of the outstanding Shares.
4. Tendering stockholders will not be obligated to pay brokerage fees
or commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, transfer taxes on the purchase of Shares by Purchaser pursuant
to the Offer. However, federal income tax backup withholding at a rate of
31% may be required, unless an exemption is provided or unless the required
tax identification information is provided. See Instruction 10 of the Letter
of Transmittal.
5. The Offer and withdrawal rights will expire at 12:00 midnight, New
York City time, on Tuesday, February 23, 1999, unless the Offer is extended.
6. The Board of Directors of the Company has unanimously determined
that the Offer and the Merger (as defined in the Offer to Purchase) are fair
to, and in the best interests of, the Company's stockholders, has
unanimously approved the Merger Agreement (as defined in the Offer to
Purchase) and the transactions contemplated by the Merger Agreement,
including the Offer and the Merger, and unanimously recommends that the
Company's stockholders accept the Offer and tender all their Shares pursuant
thereto.
7. Notwithstanding any other provision of the Offer, payment for Shares
accepted for payment pursuant to the Offer will in all cases be made only
after timely receipt by the Depositary of (a) certificates for such Shares
(the "Certificates") pursuant to the procedures set forth in Section 3 of
the Offer to Purchase, or a timely Book-Entry Confirmation (as defined in
the Offer to Purchase) with respect to such Shares, (b) the Letter of
Transmittal (or a manually signed facsimile thereof), properly completed and
duly executed with any required signature guarantees (or, in the case of
book-entry transfers, an Agent's Message (as defined in the Offer to
Purchase)), and (c) any other documents required by the Letter of
Transmittal. Accordingly, payment may not be made to all tendering
stockholders at the same time depending upon when Certificates are actually
received by the Depositary.
In order to take advantage of the Offer, (i) a duly executed and properly
completed Letter of Transmittal (or a manually signed facsimile thereof) and any
required signature guarantees (or, in the case of book-entry transfers, an
Agent's Message), and any other required documents should be sent to the
Depositary and (ii) either Certificates representing the tendered Shares or a
timely Book-Entry Confirmation (as defined in the Offer to Purchase) should be
delivered to the Depositary in accordance with the instructions set forth in the
Letter of Transmittal and the Offer to Purchase.
If holders of Shares wish to tender their Shares, but it is impracticable
for them to forward the Certificates for such Shares or other required documents
or complete the procedures for book-entry transfer prior to the Expiration Date,
a tender may be effected by following the guaranteed delivery procedures
specified in Section 3 of the Offer to Purchase.
2
<PAGE>
Neither Purchaser nor Parent will pay any fees or commissions to any broker
or dealer or other person (other than the Dealer Managers, the Information Agent
or the Depositary, as described in the Offer to Purchase) for soliciting tenders
of Shares pursuant to the Offer. Purchaser will, however, upon request,
reimburse you for customary mailing and handling expenses incurred by you in
forwarding any of the enclosed materials to your clients. Purchaser will pay or
cause to be paid any stock transfer taxes payable on the transfer of the Shares
to it, except as otherwise provided in Instruction 6 of the Letter of
Transmittal.
Any inquiries you may have with respect to the Offer should be addressed to,
and additional copies of the enclosed materials may be obtained from D.F. King &
Co., Inc., the Information Agent for the Offer, or the undersigned at their
respective addresses and telephone numbers set forth on the back cover of the
Offer to Purchase.
Very truly yours,
GOLDMAN, SACHS & CO.
- --------------------------------------------------------------------------------
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY OTHER PERSON AS AN AGENT OF PURCHASER, PARENT, THE COMPANY, THE
DEALER MANAGERS, THE INFORMATION AGENT, THE DEPOSITARY OR ANY AFFILIATE OF
ANY OF THEM, OR AUTHORIZE YOU OR ANY OTHER PERSON TO USE ANY DOCUMENT OR
MAKE ANY STATEMENT ON BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER
OTHER THAN THE DOCUMENTS ENCLOSED HEREWITH AND THE STATEMENTS CONTAINED
THEREIN.
- --------------------------------------------------------------------------------
3
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
ABT BUILDING PRODUCTS CORPORATION
BY
STRIPER ACQUISITION, INC.
A WHOLLY OWNED SUBSIDIARY
OF
LOUISIANA-PACIFIC CORPORATION
AT
$15.00 NET PER SHARE
- ----------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON TUESDAY, FEBRUARY 23, 1999, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
To Our Clients:
Enclosed for your consideration are the Offer to Purchase, dated January 25,
1999 (the "Offer to Purchase"), and the related Letter of Transmittal (which,
together with any amendments or supplements thereto, collectively constitute the
"Offer") and other materials relating to the offer by Striper Acquisition, Inc.,
a Delaware corporation ("Purchaser") and a wholly owned subsidiary of
Louisiana-Pacific Corporation, a Delaware corporation ("Parent"), to purchase
all of the outstanding shares of common stock, par value $0.01 per share (the
"Shares"), of ABT Building Products Corporation, a Delaware corporation (the
"Company"), at a purchase price of $15.00 per Share, net to the seller in cash,
upon the terms and subject to the conditions set forth in the Offer. Holders of
Shares whose certificates for such Shares (the "Certificates") are not
immediately available or who cannot deliver their Certificates and all other
required documents to the depositary for the Offer (the "Depositary") or
complete the procedures for book-entry transfer on or prior to the Expiration
Date (as defined in the Offer to Purchase) must tender their Shares according to
the guaranteed delivery procedures set forth in Section 3 of the Offer to
Purchase.
We are (or our nominee is) the holder of record of Shares held by us for
your account. A tender of such Shares can be made only by us as the holder of
record and pursuant to your instructions. The Letter of Transmittal accompanying
this letter is furnished to you for your information only and cannot be used by
you to tender Shares held by us for your account.
Accordingly, we request instructions as to whether you wish to have us
tender any or all of the Shares held by us for your account, upon the terms and
subject to the conditions set forth in the Offer.
Your attention is directed to the following:
1. The tender price is $15.00 per Share, net to the seller in cash.
2. The Offer is conditioned upon, among other things, there being
validly tendered and not properly withdrawn prior to the Expiration Date
that number of Shares which (together with any Shares then owned by Parent
or any of its subsidiaries) constitutes a majority of the Shares outstanding
on a fully-diluted basis on the date of purchase. The Offer is also subject
to certain other conditions. See Section 14 of the Offer to Purchase.
3. The Offer is being made for all outstanding Shares.
4. Tendering stockholders will not be obligated to pay brokerage fees
or commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, transfer taxes on the purchase of Shares by Purchaser pursuant
to the Offer. However, federal income tax backup withholding at a
<PAGE>
rate of 31% may be required, unless an exemption is provided or unless the
required taxpayer identification information is provided. See Instruction 10
of the Letter of Transmittal.
5. The Offer and withdrawal rights will expire at 12:00 midnight, New
York City time, on Tuesday, February 23, 1999, unless the Offer is extended.
6. The Board of Directors of the Company has unanimously determined
that the Offer and the Merger (as defined in the Offer to Purchase) are fair
to, and in the best interests of, the Company's stockholders, has
unanimously approved the Merger Agreement (as defined in the Offer to
Purchase), and the transactions contemplated by the Merger Agreement,
including the Offer and the Merger, and unanimously recommends that the
Company's stockholders accept the Offer and tender all of their Shares
pursuant to the Offer.
7. Notwithstanding any other provision of the Offer, payment for Shares
accepted for payment pursuant to the Offer will in all cases be made only
after timely receipt by the Depositary of (a) Certificates pursuant to the
procedures set forth in Section 3 of the Offer to Purchase, or a timely
Book-Entry Confirmation (as defined in the Offer to Purchase) with respect
to such Shares, (b) the Letter of Transmittal (or a manually signed
facsimile thereof), properly completed and duly executed with any required
signature guarantees, or an Agent's Message (as defined in the Offer to
Purchase) in connection with a book-entry transfer, and (c) any other
documents required by the Letter of Transmittal. Accordingly, payment may
not be made to all tendering stockholders at the same time depending upon
when Certificates are actually received by the Depositary.
The Offer is not being made to (nor will tenders be accepted from or on
behalf of) holders of Shares residing in any jurisdiction in which the making of
the Offer or acceptance thereof would not be in compliance with the laws of such
jurisdiction. In any jurisdiction where the securities, blue sky or other laws
require the Offer to be made by a licensed broker or dealer, the Offer shall be
deemed to be made on behalf of the Purchaser by Goldman, Sachs & Co., the Dealer
Managers of the Offer, or one or more registered brokers or dealers licensed
under the laws of such jurisdictions.
If you wish to have us tender any or all of the Shares held by us for your
account, please so instruct us by completing, executing, detaching and returning
to us the instruction form set forth below. Please forward your instructions to
us in ample time to permit us to submit a tender on your behalf prior to the
Expiration Date. IF YOU AUTHORIZE THE TENDER OF YOUR SHARES, ALL SUCH SHARES
WILL BE TENDERED UNLESS OTHERWISE SPECIFIED ON THE INSTRUCTION FORM SET FORTH
BELOW.
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF
COMMON STOCK
OF
ABT BUILDING PRODUCTS CORPORATION
BY
STRIPER ACQUISITION, INC.
A WHOLLY OWNED SUBSIDIARY
OF
LOUISIANA-PACIFIC CORPORATION
The undersigned acknowledge(s) receipt of your letter, the enclosed Offer to
Purchase, dated January 25, 1999, and the related Letter of Transmittal (which,
together with any amendments or supplements thereto, collectively constitute the
"Offer") in connection with the offer by Striper Acquisition, Inc., a Delaware
corporation (the "Purchaser") and a wholly owned subsidiary of Louisiana-Pacific
Corporation, a Delaware corporation, to purchase all of the outstanding shares
of common stock, par value $0.01 per share (the "Shares"), of ABT Building
Products Corporation, a Delaware corporation.
This will instruct you to tender to the Purchaser the number of Shares
indicated below (or if no number is indicated below, all Shares) which are held
by you for the account of the undersigned, upon the terms and subject to the
conditions set forth in the Offer.
Number of Shares to be Tendered:* ______________________________________________
Date: __________________________________________________________________________
________________________________________________________________________________
SIGN HERE
Signature(s): __________________________________________________________________
Print Name(s): _________________________________________________________________
Print Address(es): _____________________________________________________________
Area Code and Telephone Number(s): _____________________________________________
Taxpayer Identification or Social Security Number(s): __________________________
* Unless otherwise indicated, it will be assumed that all Shares held by us
for your account are to be tendered.
THIS FORM MUST BE RETURNED TO THE BROKERAGE FIRM MAINTAINING YOUR ACCOUNT.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE
PAYER. Social Security numbers have nine digits separated by two hyphens: e.g.,
000-00-0000. Employer Identification numbers have nine digits separated by only
one hyphen: e.g., 00-0000000. The table below will help determine the number to
give the payer.
<TABLE>
<CAPTION>
- -----------------------------------------------------
GIVE THE
SOCIAL SECURITY
FOR THIS TYPE OF ACCOUNT: NUMBER OF--
- -----------------------------------------------------
<S> <C> <C>
1. Individual The individual
2. Two or more The actual owner of
individuals (joint the account or, if
account) combined funds, the
first individual on
the account(1)
3. Custodian account of The minor(2)
a minor (Uniform
Gift to Minors Act)
4. a. The usual The grantor-
revocable savings trustee(1)
trust (grantor is
also trustee)
b. So-called trust The actual owner(1)
account that is
not a legal or
valid trust under
state law
5. Sole proprietorship The owner(3)
- -----------------------------------------------------
<CAPTION>
GIVE THE EMPLOYER
IDENTIFICATION
FOR THIS TYPE OF ACCOUNT: NUMBER OF--
<S> <C> <C>
- -----------------------------------------------------
6. Sole proprietorship The owner(3)
7. A valid trust, The legal entity (Do
estate, or pension not furnish the
trust identifying number
of the personal
representative or
trustee unless the
legal entity itself
is not designated in
the account
title.)(4)
8. Corporate The corporation
9. Association, club, The organization
religious,
charitable,
educational or other
tax-exempt
organization
10. Partnership The partnership
11. A broker or The broker or
registered nominee nominee
12. Account with the The public entity
Department of
Agriculture in the
name of a public
entity (such as a
state or local
government, school
district, or prison)
that receives
agriculture program
payments
</TABLE>
- ---------------------------------------------
- ---------------------------------------------
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Show the name of the owner.
(4) List first and circle the name of the legal trust, estate, or pension trust.
NOTE: IF NO NAME IS CIRCLED WHEN THERE IS MORE THAN ONE NAME, THE NUMBER WILL BE
CONSIDERED TO BE THAT OF THE FIRST NAME LISTED.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
PAGE 2
SECTION REFERENCES ARE TO THE INTERNAL REVENUE CODE.
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you don't know your
number, obtain Form SS-5, Application for a Social Security Number Card, or Form
SS-4, Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service (the "IRS") and
apply for a number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
The following is a list of payees exempt from backup withholding and for which
no information reporting is required. For interest and dividends, all listed
payees are exempt except item (9). For broker transactions, payees listed in (1)
through (13) and a person registered under the Investment Advisers Act of 1940
who regularly acts as a broker are exempt. Payments subject to reporting under
sections 6041 and 6041A are generally exempt from backup withholding only if
made to payees described in items (1) through (7), except that a corporation
that provides medical and health care services or bills and collects payments
for such services is not exempt from backup withholding or information
reporting. Only payees described in items (2) through (6) are exempt from backup
withholding for barter exchange transactions, patronage dividends, and payments
by certain fishing boat operators.
(1) A corporation.
(2) An organization exempt from tax under section 501(a), or an individual
retirement plan ("IRA"), or a custodial account under 403(b)(7), if the
account satisfies the requirements of section 401(f)(2).
(3) The United States or any of its agencies or instrumentalities.
(4) A State, the District of Columbia, a possession of the United States, or any
of their political subdivisions or instrumentalities.
(5) A foreign government or any of its political subdivisions, agencies or
instrumentalities.
(6) An international organization or any of its agencies or instrumentalities.
(7) A foreign central bank of issue.
(8) A dealer in securities or commodities required to register in the United
States, the District of Columbia, or a possession of the United States.
(9) A futures commission merchant registered with the Commodity Futures Trading
Commission.
(10) A real estate investment trust.
(11) An entity registered at all times during the tax year under the Investment
Company Act of 1940.
(12) A common trust fund operated by a bank under section 584(a).
(13) A financial institution.
(14) A middleman known in the investment community as a nominee or listed in the
most recent publication of the American Society of Corporate Secretaries,
Inc., Nominee List.
(15) A trust exempt from tax under section 664 or described in section 4947.
Payments of dividends and patronage dividends generally not subject to backup
withholding also include the following:
- - Payments to nonresident aliens subject to withholding under section 1441.
- - Payments to partnerships not engaged in a trade or business in the United
States and that have at least one nonresident partner.
- - Payments of patronage dividends not paid in money.
- - Payments made by certain foreign organizations.
- - Section 404(k) payments made by an ESOP.
Payments of interest generally not subject to backup withholding include the
following:
- - Payments of interest on obligations issued by individuals.
Note: YOU MAY BE SUBJECT TO BACKUP WITHHOLDING IF THIS INTEREST IS $600 OR
MORE AND IS PAID IN THE COURSE OF THE PAYER'S TRADE OR BUSINESS AND YOU HAVE
NOT PROVIDED YOUR CORRECT TAXPAYER IDENTIFICATION NUMBER TO THE PAYER.
- - Payments of tax-exempt interest (including exempt interest dividends under
section 852).
- - Payments described in section 6049(b)(5) to nonresident aliens.
- - Payments on tax-free covenant bonds under section 1451.
- - Payments made by certain foreign organizations.
- - Mortgage interest paid by you.
Payments that are not subject to information reporting are also not subject to
backup withholding. For details see sections 6041, 6041A(a), 6042, 6044, 6045,
6049, 6050A and 6050N, and the regulations under such sections.
PRIVACY ACT NOTICE
Section 6109 requires you to give your correct taxpayer identification number to
persons who must file information returns with the IRS to report interest,
dividends, and certain other income paid to you, mortgage interest you paid, the
acquisition or abandonment of secured property, cancellation of debt, or
contributions you made to an IRA. The IRS uses the numbers for identification
purposes and to help verify the accuracy of your tax return. You must provide
your taxpayer identification number whether or not you are qualified to file a
tax return. Payers must generally withhold 31% of taxable interest, dividend,
and certain other payments to a payee who does not furnish a taxpayer
identification number to a payer. Certain penalties may also apply.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER. If you fail
to furnish your taxpayer identification number to a payer, you are subject to a
penalty of $50 for each such failure unless your failure is due to reasonable
cause and not to willful neglect.
(2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING. If you make
a false statement with no reasonable basis that results in no backup
withholding, you are subject to a $500 penalty.
(3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION. Falsifying certifications or
affirmations may subject you to criminal penalties including fines and/or
imprisonment.
FOR ADDITIONAL INFORMATION CONTACT
YOUR TAX CONSULTANT OR THE INTERNAL
REVENUE SERVICE
<PAGE>
Exhibit 99(a)(7)
THIS ANNOUNCEMENT IS NEITHER AN OFFER TO PURCHASE NOR A SOLICITATION OF AN
OFFER TO SELL SHARES. THE OFFER IS MADE SOLELY BY THE OFFER TO PURCHASE DATED
JANUARY 25,1999 AND THE RELATED LETTER OF TRANSMITTAL AND IS NOT BEING MADE TO
(NOR WILL TENDERS BE ACCEPTED FROM OR ON BEHALF OF) HOLDERS OF SHARES RESIDING
IN ANY JURISDICTION IN WHICH THE MAKING OF THE OFFER OR ACCEPTANCE THEREOF WOULD
NOT BE IN COMPLIANCE WITH THE LAWS OF SUCH JURISDICTION. IN ANY JURISDICTION
WHERE THE SECURITIES, BLUE SKY OR OTHER LAWS REQUIRE THE OFFER TO BE MADE BY A
LICENSED BROKER OR DEALER, THE OFFER SHALL BE DEEMED TO BE MADE ON BEHALF OF THE
PURCHASER BY GOLDMAN, SACHS & CO., THE DEALER MANAGERS OF THE OFFER, OR ONE OR
MORE REGISTERED BROKERS OR DEALERS LICENSED UNDER THE LAWS OF SUCH
JURISDICTIONS.
Notice of Offer to Purchase for Cash
All Outstanding Shares of Common Stock
of
ABT Building Products Corporation
by
Striper Acquisition, Inc.
A Wholly-Owned Subsidiary
of
Louisiana-Pacific Corporation
at
$15.00 Net Per Share
Striper Acquisition, Inc., a Delaware corporation (the "Purchaser") and a
wholly-owned subsidiary of Louisiana-Pacific Corporation, a Delaware corporation
("Parent"), is offering to purchase all of the outstanding shares of common
stock, par value $0.01 per share (the "Shares"), of ABT Building Products
Corporation, a Delaware corporation (the "Company"), at $15.00 per Share, net to
the seller in cash, without interest, upon the terms and subject to the
conditions set forth in the Offer to Purchase dated January 25, 1999 (the "Offer
to Purchase") and in the related Letter of Transmittal (which together
constitute the "Offer").
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON TUESDAY, FEBRUARY 23, 1999, UNLESS THE OFFER IS EXTENDED.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION DATE (AS DEFINED IN THE OFFER
TO PURCHASE) THAT NUMBER OF SHARES OF COMMON STOCK, PAR VALUE $0.01 PER SHARE,
OF THE COMPANY WHICH (TOGETHER WITH ANY SHARES THEN OWNED BY PARENT OR ANY OF
ITS SUBSIDIARIES) CONSTITUTES A MAJORITY OF THE SHARES OF COMMON STOCK
OUTSTANDING ON A FULLY DILUTED BASIS ON THE DATE OF PURCHASE (THE "MINIMUM SHARE
CONDITION"). THE OFFER IS ALSO SUBJECT TO CERTAIN OTHER CONDITIONS SET FORTH IN
THE OFFER TO PURCHASE. SEE SECTION 14 OF THE OFFER TO PURCHASE.
The Offer is being made pursuant to an Agreement and Plan of Merger, dated
as of January 19, 1999 (the "Merger Agreement"), among Parent, the Purchaser and
the Company. The Merger Agreement provides that, among other things, the
Purchaser will make the Offer and that following the purchase of Shares pursuant
to the Offer, subject to the satisfaction or waiver of certain conditions set
forth in the Merger Agreement and in accordance with relevant provisions of the
Delaware General Corporation Law ("DGCL"), the Purchaser will be merged with and
into the Company (the "Merger"). Following consummation of the Merger, the
Company will continue as the surviving corporation and will be a wholly-owned
subsidiary of Parent. At the effective time of the Merger (the "Effective
Time"), each Share (excluding Shares owned by the Company or any subsidiary of
the Company or by Parent or any subsidiary of Parent and any Shares owned by
stockholders who have properly exercised their appraisal rights under Delaware
law) issued and outstanding immediately prior to the Effective Time will be
converted into the right to receive cash in an amount equal to the price per
Share paid pursuant to the Offer, without interest (and less any required
withholding taxes). The Merger Agreement is more fully described in Section 12
of the Offer to Purchase.
<PAGE>
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY DETERMINED THAT EACH
OF THE OFFER AND THE MERGER IS FAIR TO, AND IN THE BEST INTERESTS OF, THE
COMPANY'S STOCKHOLDERS, HAS UNANIMOUSLY APPROVED THE MERGER AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED THEREBY, INCLUDING THE OFFER AND THE MERGER, AND
UNANIMOUSLY RECOMMENDS THAT THE COMPANY'S STOCKHOLDERS ACCEPT THE OFFER AND
TENDER ALL OF THEIR SHARES PURSUANT TO THE OFFER.
Concurrently with the execution and delivery of the Merger Agreement,
Parent, the Purchaser and certain stockholders of the Company (the "Principal
Stockholders") entered into a Stockholder Agreement (the "Stockholder
Agreement"). Pursuant to the Stockholder Agreement, the Principal Stockholders,
who collectively own 4,952,564 Shares, or approximately 46.4% of the shares
outstanding as of January 14, 1999 (and one of whom holds options to purchase an
additional 710,000 Shares from the Company), agreed, among other things, to
tender all of such outstanding Shares pursuant to the Offer, and granted the
Purchaser an option to purchase all of such outstanding Shares upon the
occurrence of certain events. The foregoing agreement to tender and grant of an
option also apply to any Shares acquired by any of the Principal Stockholders
during the term of the Stockholder Agreement, including any Shares acquired upon
the exercise of stock options. The Stockholder Agreement is more fully described
in Section 12 of the Offer to Purchase.
For purposes of the Offer, the Purchaser shall be deemed to have accepted
for payment (and thereby purchased) tendered Shares if, as and when the
Purchaser gives oral or written notice to the Depositary (as defined in the
Offer to Purchase) of its acceptance of such Shares for payment. Payment for
Shares accepted for payment pursuant to the Offer will be made only after timely
receipt by the Depositary (as defined in the Offer to Purchase) of (i)
certificates for such Shares (or a confirmation of a book-entry transfer of such
Shares into the Depositary's account at the Book-Entry Transfer Facility (as
defined in the Offer to Purchase)), (ii) a properly completed and duly executed
Letter of Transmittal (or facsimile thereof) or, in the case of a book-entry
transfer, an Agent's Message (as defined in the Offer to Purchase), and (iii)
any other documents required by the Letter of Transmittal.
The consummation of the Merger is subject to the satisfaction or waiver of
certain conditions set forth in the Merger Agreement, including, if required,
the approval of the Merger by the requisite vote of the stockholders of the
Company. Under the DGCL, the stockholder vote necessary to approve the Merger
will be the affirmative vote of a majority of the outstanding Shares, including
Shares held by the Purchaser and its affiliates. If the Minimum Share Condition
is satisfied and the Purchaser purchases Shares pursuant to the Offer, the
Purchaser will be able to effect the Merger without the affirmative vote of any
other stockholder of the Company. If the Purchaser acquires at least 90% of the
outstanding Shares pursuant to the Offer or otherwise, the Purchaser will be
able to effect the Merger pursuant to the "short-form" merger provisions of
Section 253 of the DGCL, without prior notice to, or any action by, any other
stockholder of the Company.
UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON THE PURCHASE PRICE TO BE
PAID FOR SHARES PURSUANT TO THE OFFER, REGARDLESS OF ANY EXTENSION OF THE OFFER
OR ANY DELAY IN MAKING SUCH PAYMENT. SIMILARLY, NO INTEREST WILL BE PAID ON THE
CONSIDERATION TO BE PAID IN THE MERGER TO STOCKHOLDERS WHO FAIL TO TENDER THEIR
SHARES PURSUANT TO THE OFFER, REGARDLESS OF ANY DELAY IN EFFECTING THE MERGER OR
MAKING SUCH PAYMENT.
The term "Expiration Date" shall mean 12:00 Midnight, New York City time,
on Tuesday, February 23, 1999, unless and until the Purchaser (in accordance
with the terms of the Merger Agreement), shall have extended the period of time
during which the Offer is open, in which event the term "Expiration Date" shall
mean the latest time and date at which the Offer, as so extended by the
Purchaser, shall expire.
Subject to the terms of the Merger Agreement and the applicable rules and
regulations of the Securities and Exchange Commission, the Purchaser may, under
certain circumstances, (i) extend the period of time during which the Offer is
open and thereby delay acceptance for payment of and the payment for any Shares,
by giving oral or written notice of such extension to the Depositary and (ii)
amend the Offer in any other respect by giving oral or written notice of such
amendment to the Depositary. Any extension, delay, waiver, amendment or
termination of the Offer will be
<PAGE>
followed as promptly as practicable by a public
announcement thereof, the announcement in the case of an extension to be issued
no later than 9:00 a.m., New York City time, on the next business day after the
previously scheduled Expiration Date. During any such extension, all Shares
previously tendered and not properly withdrawn will remain subject to the Offer,
subject to the right of a tendering stockholder to withdraw such stockholder's
Shares.
Tenders of Shares made pursuant to the Offer may be withdrawn at any time
prior to the Expiration Date. Thereafter, such tenders are irrevocable, except
that they may be withdrawn at any time after March 25, 1999 unless theretofore
accepted for payment as provided in the Offer to Purchase. For a withdrawal to
be effective, a written, telegraphic, telex or facsimile transmission notice of
withdrawal must be timely received by the Depositary at one of its addresses set
forth in the Offer to Purchase and must specify the name of the person who
tendered the Shares to be withdrawn, the number of Shares to be withdrawn and
the name of the registered holders of the Shares, if different from the person
who tendered the Shares. If the Shares to be withdrawn have been delivered to
the Depositary, a signed notice of withdrawal with (except in the case of Shares
tendered by an Eligible Institution (as defined in the Offer to Purchase))
signatures guaranteed by an Eligible Institution must be submitted prior to the
release of such Shares. In addition, such notice must specify, in the case of
Shares tendered by delivery of certificates, the name of the registered holder
(if different from that of the tendering stockholder) and the serial numbers
shown on the particular certificates evidencing the Shares to be withdrawn or,
in the case of Shares tendered by book-entry transfer, the name and number of
the account at the Book-Entry Transfer Facility to be credited with the
withdrawn Shares.
The information required to be disclosed by paragraph (e)(1)(vii) of Rule
14d-6 of the General Rules and Regulations under the Securities Exchange Act of
1934, as amended, is contained in the Offer to Purchase and is incorporated
herein by reference.
The Company has provided the Purchaser with the Company's stockholder list
and security position listings for the purpose of disseminating the Offer to
holders of Shares. The Offer to Purchase and the related Letter of Transmittal
will be mailed to record holders of Shares and will be furnished to brokers,
banks and similar persons whose names, or the names of whose nominees, appear on
the stockholder list or, if applicable, who are listed as participants in a
clearing agency's security position listing for subsequent transmittal to
beneficial owners of Shares.
The Offer to Purchase and the related Letter of Transmittal contain
important information which should be read carefully before any decision is made
with respect to the Offer.
Requests for copies of the Offer to Purchase, the related Letter of
Transmittal and other tender offer materials may be directed to the Information
Agent or the Dealer Managers as set forth below, and copies will be furnished
promptly at the Purchaser's expense. The Purchaser will not pay any fees or
commissions to any broker or dealer or any other person (other than the Dealer
Managers and the Information Agent) for soliciting tenders of Shares pursuant to
the Offer.
The Information Agent for the Offer is:
D.F. King & Co., Inc.
77 Water Street
New York, New York 10005
Banks and Brokers, Call Collect: (212) 425-1685
All Others Call Toll Free: (800) 290-6429
The Dealer Managers for the Offer are:
Goldman, Sachs & Co.
85 Broad Street
New York, New York 10004
(800) 323-5678
January 25, 1999
<PAGE>
Exhibit 99(a)(8)
[LETTERHEAD OF LOUISIANA-PACIFIC]
NEWS RELEASE
Release No. 102-1-9
Contact:
Bill Hebert (Investor Rel.)
Gerry Soud (Media Rel.)
FOR IMMEDIATE RELEASE
Louisiana-Pacific To Accelerate Growth with Acquisition
of ABT Building Products Corporation
Proposed Acquisition Will Expand Specialty Product Lines and
Complement Commodity Offerings
(Portland, Ore: January 19, 1999) -- In a move designed to expand both the
breadth and geographic scope of its building products offering,
Louisiana-Pacific Corp. (NYSE: LPX) announced today that it has entered into a
definitive agreement to purchase all outstanding shares of ABT Building Products
Corporation (NASDAQ:ABTC) at $15 per share in cash. Louisiana-Pacific will
commence a tender offer for the ABT Building Products Corporation shares by
Monday, January 25, 1999. The transaction is valued at approximately $225
million, including assumption of debt. It is expected to close in late February.
"This acquisition will be a great strategic addition to our business," said Mark
A. Suwyn, chairman and CEO of Louisiana-Pacific. "It accelerates our basic
strategy of complementing our low cost efficiently produced commodity building
products with a wide variety of specialty product offerings for our customers.
In addition, ABT Building Products Corporation has highly-respected and talented
employees who know how to grow a specialty products business and who share our
customer focus philosophy."
The transaction is subject to compliance with certain regulatory requirements
and other customary conditions, but has received the approval of the Boards of
Directors of both companies. In addition, holders of approximately 46% of ABT
Building Products Corporation's outstanding shares have agreed to tender their
shares.
-MORE-
<PAGE>
"We are delighted to join forces with an industry powerhouse like
Louisiana-Pacific, with tremendous resources and high visibility in the
marketplace," said George T. Brophy, Chairman and Chief Executive Officer of
ABT. "The combination of L-P's capabilities with ABT's expertise in producing
specialty building products, as well as the strong marketing relationships we've
developed, offers excellent potential for us to achieve sustained gains in
market share and profitability as a consolidated enterprise."
"The purchase of ABT Building Products Corporation is consistent with L-P's
established acquisition criteria," said Curtis Stevens, L-P's Vice President and
CFO. "We believe that it provides an excellent strategic fit that will rapidly
grow our existing businesses and add to earnings."
Louisiana-Pacific, now in its 26th year, is a major building products company
headquartered in Portland, Oregon, with manufacturing facilities throughout the
United States and in Canada and Ireland. Visit L-P's website at: www.LPCorp.com.
Headquartered in Neenah, Wisconsin, ABT Building Products Corporation
manufactures interior paneling, exterior hardboard and vinyl sidings and
accessories, plastic mouldings, and specialty building products. The company has
six manufacturing facilities in the U.S., and two in Canada. ABT Building
Products Corporation recently announced the site of its fiber cement business
which is expected to be finalized prior to the closure of this transaction. ABT
Building Products Corporation's net sales in 1997 totaled $321 million. Visit
ABT's website at www.ABTCO.com.
-30-
Forward-Looking Statements
Some statements in this document may constitute forward-looking statements
within the meaning of the federal securities laws. Forward-looking statements
include, without limitation, statements regarding the outlook for future
operations, forecasts of future costs and expenditures, evaluation of market
conditions, the outcome of legal proceedings, the adequacy of reserves, or plans
for product development. Investors are cautioned that forward-looking statements
are subject to an inherent risk that actual results may vary materially from
those described herein. Factors that may result in such variance, in addition to
those set forth under the above captions, include changes in interest rates,
commodity prices, and other economic conditions; actions by competitors,
changing weather conditions and other natural phenomena; actions by government
authorities; uncertainties associated with legal proceedings; technological
developments; future decisions by management in response to changing conditions;
and misjudgments in the course of preparing forward-looking statements.
<PAGE>
Exhibit 99(b)(2)
THIS CONSENT AND FIRST AMENDMENT TO CREDIT AGREEMENT ("Amendment"), dated
as of December 31, 1997, is entered into by LOUISIANA-PACIFIC CORPORATION (the
"Revolving Borrower"), LOUISIANA-PACIFIC CANADA LTD. ("OLDCO"),
LOUISIANA-PACIFIC CANADA PULP CO. ("NEWCO"), BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as agent for itself and the Banks (the "Agent"), and the
several financial institutions parties to the Credit Agreement referred to below
(collectively, the "Banks").
RECITALS
A. The Revolving Borrower, OLDCO, the Banks, and Agent are parties to the
Credit Agreement dated as of January 31,1997 (the "Credit Agreement"), pursuant
to which the Agent and the Banks have extended certain credit facilities to the
Revolving Borrower and the Term Borrower.
B. The Revolving Borrower has requested that the Agent and the Banks agree
to permit NEWCO to assume the Term Loans and release OLDCO therefrom.
C. The Revolving Borrower has also reported to the Agent and the Banks
that it intends to dispose of certain assets during to 1998 calendar year, the
fair market value of which will exceed ten percent (10%) of the total
consolidated assets of the Revolving Borrower, thus requiring a waiver from the
Majority Banks under Section 7.02(b) of the Credit Agreement
D. The Banks now hereby wish to grant their consent to the disposition of
certain asset of the Revolving Borrower, and the parties hereto wish to amend
the Credit Agreement in certain respects as provided herein, all subject to the
terms and conditions of this Amendment.
NOW, THEREFORE, for valuable consideration, the receipt and adequacy of
which are hereby acknowledged, the parties hereto hereby agree as follows:
1. Defined Terms. Unless otherwise defined herein or the context
clearly indicates otherwise, capitalized terms used herein shall have the
meanings, if any, assigned to them in the Credit Agreement.
2. Amendments to the Credit Agreement. The following Sections of the
Credit Agreement are hereby amended as follows:
(a) The preamble shall be amended by deleting
"Louisiana-Pacific Canada Ltd." and inserting "Louisiana-Pacific Canada Pulp
Co." in its stead.
(b) Section 5.01 shall be amended by deleting the phrase "Each
Borrower" and inserting the phrase "Revolving Borrower" in its stead; and
deleting the phrase "such Borrower" and inserting the word "it" in its stead and
inserting the following phrase after the semicolon at the end of the section:
"Term Borrower is a Nova Scotia Unlimited Liability Company duly organized and
existing under the laws of the
1
<PAGE>
Province of Nova Scotia, Canada, and is properly qualified or registered under
the laws of every jurisdiction in which it is doing business of a nature that
requires qualification or registration of entities not organized under the laws
of such jurisdiction;"
(c) Subsection 8.01(j) shall be amended by inserting the
phrase, "(either directly or through a wholly-owned subsidiary)" after the word
"own" and inserting the phrase, "or such intermediate wholly-owned subsidiary"
before the semicolon at the end of the Subsection.
(d) Schedule 10.02 shall be amended by deleting the name
end title "William L. Hebert, Treasurer and CFO" from the contact information
for Louisiana-Pacific Corporation and inserting the name and title "Lynn L.
Miller, Assistant Treasurer" in its stead and by inserting the following name
and contact information following the contact information for
Louisiana-Pacific Corporation:
LOUISIANA-PACIFIC CANADA PULP CO.
Address for Notices:
Louisiana-Pacific Canada Pulp Co.
111 S.W. Fifth Avenue
Portland, OR 97204
Attn: Lynn L. Miller
Assistant Treasurer
Telephone: (503) 221-0800
Facsimile: (503) 796-0319
(e) Each reference to "Louisiana-Pacific Canada Ltd." in the
Exhibits to the Credit Agreement, other than in Exhibits D-l, D-2, and D-3,
shall be amended by substituting "Louisiana-Pacific Canada Pulp Co." in its
stead.
3. Release. The Agent and the Banks agree that, upon the Effective
Date defined below, Louisiana-Pacific Canada Ltd. shall be released from its
obligations as Term Borrower under the Credit Agreement, the Term Notes, and all
agreements, documents, and certificates delivered pursuant to the Credit
Agreement (collectively, the "Loan Documents").
4. Consent to Disposition of Assets. The Banks hereby agree that
the sale, lease, sale and lease back, exchange, transfer or other disposition,
during the 1998 calendar year, of the assets listed in Schedule I to this
Amendment shall be disregarded in calculating compliance with Subsection 7.02(b)
of the Credit Agreement for the 1998 calendar year.
2
<PAGE>
5. Representations and Warranties. The Revolving Borrower, OLDCO and
NEWCO hereby jointly and severally represent and warrant to the Agent and the
Banks as follows:
(a) No Default or Event of Default has occurred and is
continuing.
(b) On or before the Effective Date, NEWCO shall have been
duly established as a Nova Scotia Unlimited Liability Company and the execution,
delivery and performance by NEWCO of this Amendment and the Assumption Agreement
of even date herewith shall have been duly authorized by all necessary corporate
and other action and do not and will not require any registration with, consent
or approval of, notice to or action by, any Person (including any governmental
agency) in order to be effective and enforceable. On or before the Effective
Date, the Loan Documents and the Assumption Agreement to which the Term Borrower
is a signatory, as amended by this Amendment, shall constitute the legal, valid
and binding obligations of NEWCO, enforceable against it in accordance with
their respective terms, without defense, counterclaim or offset.
(c) On the Effective Date, all representations and warranties
of the Borrowers contained in Article V of the Credit Agreement as amended by
this Amendment are true and correct, and will remain true and correct following
the substitution of NEWCO for OLDCO as the Term Borrower.
6. Effective Date. This Amendment will become effective on the first
Business Day (the "Effective Date") upon which the Agent has received each of
the following, in form and substance satisfactory to the Agent and each Bank,
and with sufficient copies for each Bank:
(a) Amendment. This Amendment executed by the Revolving
Borrower, OLDCO, NEWCO, the Agent, and each Bank and the Acknowledgement and
Consent attached hereto executed by the Revolving Borrower;
(b) Resolutions; Incumbency.
(i) Copies of the resolutions of the Board of Directors
of NEWCO approving and authorizing the execution, delivery and performance by
the President of NEWCO on behalf of NEWCO of this Amendment and the other
Documents being executed in connection herewith and the transactions
contemplated hereby and thereby, certified as of the Effective Date by the
Secretary of NEWCO; and
(ii) A certificate of the Secretary of NEWCO certifying
the names and true signatures of the officers of NEWCO, authorized to execute,
deliver and perform, as applicable, this Amendment on behalf of NEWCO, and all
other documents to be delivered hereunder, as well as a certificate signed by
the President of NEWCO stating that all representations and warranties contained
herein are true and correct as of the Effective Date and that no Default or
Event of Default exists as of the Effective Date;
3
<PAGE>
(c) Organization Documents; Good Standing. Each of the
following documents:
(i) the incorporation certificate of NEWCO certified by
the Registrar of Joint Stock Companies (or similar applicable governmental
authority) of the state of formation of NEWCO as of a recent date; and
(ii) a Status Certificate for NEWCO issued by the
Registrar of Joint Stock Companies (or similar applicable governmental
authority) of its state of incorporation or formation as of a recent date;
(d) Legal Opinions. opinion of Miller, Nash, Wiener, Hager &
Carlsen LLP, as counsel to the Revolving Borrower, and an opinion of Law Office
of Ivo R. Winter, as counsel to NEWCO, each addressed to the Agent and the
Banks, in a form acceptable to the Majority Banks;
(e) Notes. Replacement Notes for each Bank that has elected to
have its Loans so evidenced, that indicates the change of the Term Borrower
pursuant to this Amendment, and that requests such a replacement Note before the
Effective Date;
(f) Assumption of Obligations by NEWCO. An Assumption
Agreement substantially in the form of Exhibit A; and
(g) Amendment Fee. Payment in immediately available funds of
the amendment fee as previously agreed in the letter from the Agent to the
Revolving Borrower dated December 11, 1997.
7. Reservation of Rights. The Borrowers acknowledge and agree that
the execution and delivery by the Agent and the Banks of this Amendment shall
not be deemed to create a course of dealing or otherwise obligate the Agent or
the Banks to grant similar consents or amendments under the same or similar
circumstances in the future.
8. Miscellaneous.
(a) Except as herein expressly amended, all terms, covenants
and provisions of the Credit Agreement are and shall remain in full force and
effect and all references therein to such Credit Agreement shall henceforth
refer to the Credit Agreement as modified by this Amendment. This Amendment
shall be deemed incorporated into, and a part of, the Credit Agreement.
(b) This Amendment shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and assigns. No
third party beneficiaries are intended in connection with this Amendment.
(c) This Amendment shall be governed by and construed in
accordance with the laws of the State of California.
4
<PAGE>
(d) This Amendment may be executed in any number of
counterparts, each of which shall be deemed an original, but all such
counterparts together shall constitute but one and the same instrument.
(e) This Amendment, together with the Credit Agreement,
contains the entire and exclusive agreement of the parties hereto with reference
to the matters discussed herein and therein. This Amendment supersedes all prior
drafts and communications with respect thereto. This Amendment may not be
amended except in accordance with the provisions of Section 10.01 of the Credit
Agreement.
(f) If any term or provision of this Amendment shall be deemed
prohibited by or invalid under any applicable law, such provision shall be
invalidated without affecting the remaining provisions of this Amendment or the
Credit Agreement, respectively.
(g) Borrower covenants to pay to or reimburse the Agent and
the Banks, upon demand, for all costs and expenses (including allocated costs of
in-house counsel) incurred in connection with the development, preparation,
negotiation, execution and delivery of this Amendment.
5
<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed and delivered this
Amendment as of the date first above written.
LOUISIANA-PACIFIC CORPORATION
By: /s/ Ann Stevens
------------------------------------
Title: Vice President, Treasurer and
Chief Financial Officer
---------------------------------
By: /s/ Lynn L. Miller
------------------------------------
Title: Assistant Treasurer
---------------------------------
LOUISIANA-PACIFIC CANADA PULP CO.
By: /s/ Ann Stevens
------------------------------------
Title: Vice President, Treasurer and
Chief Financial Officer
---------------------------------
By: /s/ Lynn L. Miller
------------------------------------
Title: Assistant Treasurer
---------------------------------
LOUISIANA-PACIFIC CANADA LTD.
By: /s/ Ann Stevens
------------------------------------
Title: Vice President, Treasurer and
Chief Financial Officer
---------------------------------
By: /s/ Lynn L. Miller
------------------------------------
Title: Assistant Treasurer
---------------------------------
6
<PAGE>
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Agent
By: /s/ Christy R. Gerherd
------------------------------------
Title: Vice President
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as a Bank
By: /s/ Christy R. Gerherd
------------------------------------
Title: Vice President
ABN AMRO BANK N.V.
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
ROYAL BANK OF CANADA
By:
------------------------------------
Title:
---------------------------------
<PAGE>
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Agent
By:
------------------------------------
Title: Vice President
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as a Bank
By:
------------------------------------
Title: Vice President
ABN AMRO BANK N.V.
By: /s/ David McGinnis
------------------------------------
Title: David McGinnis, Vice President
---------------------------------
By: /s/ Leif H. Olsson
------------------------------------
Title: Leif H. Olsson, Senior Vice
President
---------------------------------
ROYAL BANK OF CANADA
By:
------------------------------------
Title:
---------------------------------
<PAGE>
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as Agent
By:
------------------------------------
Title: Vice President
BANK OF AMERICA NATIONAL TRUST AND SAVINGS
ASSOCIATION, as a Bank
By:
------------------------------------
Title: Vice President
ABN AMRO BANK N.V.
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
ROYAL BANK OF CANADA
By: /s/ Stephen S. Hughes
------------------------------------
Title: STEPHEN S. HUGHES
SENIOR MANAGER
---------------------------------
<PAGE>
SOCIETE GERERALE
By: /s/ Maureen E. Kelly
------------------------------------
Title: MAUREEN E. KELLY
Vice President
---------------------------------
By:
------------------------------------
Title:
---------------------------------
SOCIETE GENERALE FINANCE (IRELAND) LIMITED
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
THE BANK OF NOVA SCOTIA
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
<PAGE>
SOCIETE GENERALE
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
SOCIETE GENERALE FINANCE (IRELAND) LIMITED
By: /s/ R. Aland
------------------------------------
Title: MANAGING DIRECTOR
---------------------------------
By: /s/ Jacinta Loneoy
------------------------------------
Title: Loan Administrator
---------------------------------
THE BANK OF NOVA SCOTIA
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
<PAGE>
SOCIETE GENERALE
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
SOCIETE GENERALE FINANCE (IRELAND) LIMITED
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
THE BANK OF NOVA SCOTIA
By: /s/ David Keiff
------------------------------------
Title: officer
---------------------------------
By:
------------------------------------
Title:
---------------------------------
<PAGE>
THE CHASE MANHATTAN BANK
By: /s/ Timothy J. Storms
------------------------------------
Title: TIMOTHY J. STORMS
MANAGING DIRECTOR
---------------------------------
FIRST NATIONAL BANK OF CHICAGO
By:
------------------------------------
Title:
---------------------------------
WACHOVIA BANK OF GEORGIA
By:
------------------------------------
Title:
---------------------------------
UNITED STATES NATIONAL BANK OF OREGON
By:
------------------------------------
Title:
---------------------------------
WELLS FARGO BANK, N.A.
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
<PAGE>
THE CHASE MANHATTAN BANK
By:
------------------------------------
Title:
---------------------------------
FIRST NATIONAL BANK OF CHICAGO
By: Mark A. Isley /s/ Mark A. Isley
------------------------------------
Title: First Vice President
---------------------------------
WACHOVIA BANK OF GEORGIA
By:
------------------------------------
Title:
---------------------------------
UNITED STATES NATIONAL BANK OF OREGON
By:
------------------------------------
Title:
---------------------------------
WELLS FARGO BANK, N.A.
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
<PAGE>
THE CHASE MANHATTAN BANK
By:
------------------------------------
Title:
---------------------------------
FIRST NATIONAL BANK OF CHICAGO
By:
------------------------------------
Title:
---------------------------------
WACHOVIA BANK OF GEORGIA
By: /s/ John A. Whites
------------------------------------
Title: Vice President
---------------------------------
UNITED STATES NATIONAL BANK OF
OREGON
By:
------------------------------------
Title:
---------------------------------
WELLS FARGO BANK, N.A.
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
<PAGE>
THE CHASE MANHATTAN BANK
By:
------------------------------------
Title:
---------------------------------
FIRST NATIONAL BANK OF CHICAGO
By:
------------------------------------
Title:
---------------------------------
WACHOVIA BANK OF GEORGIA
By:
------------------------------------
Title:
---------------------------------
UNITED STATES NATIONAL BANK OF
OREGON
By: /s/ Janice T. Thead
------------------------------------
Title: Vice President
---------------------------------
WELLS FARGO BANK, N.A.
By:
------------------------------------
Title:
---------------------------------
By:
------------------------------------
Title:
---------------------------------
<PAGE>
THE CHASE MANHATTAN BANK
By:
------------------------------------
Title:
---------------------------------
FIRST NATIONAL BANK OF CHICAGO
By:
------------------------------------
Title:
---------------------------------
WACHOVIA BANK OF GEORGIA
By:
------------------------------------
Title:
---------------------------------
UNITED STATES NATIONAL BANK OF
OREGON
By:
------------------------------------
Title:
---------------------------------
WELLS FARGO BANK, N.A.
By: /s/ Frieda Youngs
------------------------------------
Title: Vice President
---------------------------------
By: /s/ Ann
------------------------------------
Title: Assistant Vice-President
---------------------------------
<PAGE>
THE BANK OF NEW YORK
By: /s/ Robert Louk
------------------------------------
Robert Louk
Title: Vice President
---------------------------------
<PAGE>
Exhibit 99(b)(3)
[LETTERHEAD OF BANK OF AMERICA]
January 14, 1999
Louisiana-Pacific Corporation
111 S.W. Fifth Avenue
Portland, OR 97204
Attention; Mr. William L. Hebert, Director, Business
Development
Re: Limited Waiver to Credit Agreement ("Credit Agreement") dated as of
January 31, 1997 among Louisiana-Pacific Corporation, a Delaware
corporation (the "Company"), as the Revolving Borrower, Louisiana-Pacific
Canada Pulp Co., a Nova Scotia, Canada corporation, as the Term Borrower,
the financial Institutions party thereto (the "Banks") and Bank of America
National Trust and Savings Association, as agent for the Banks and the
Designated Bidders (the "Agent")
Dear Mr. Hebert:
Pursuant to your letter to the Agent dated January 13, 1999 (the "Request
Letter") you have requested that the Banks agree to a waiver of the provisions
of Section 7.03 of the Credit Agreement (entitled "Mergers") and Section 7.05 of
the Credit Agreement (entitled "Use of Proceeds"). As detailed in the Request
Letter, the Company has requested this waiver to permit it to acquire a
publicly-held company (the "Acquisition") using Loan proceeds. (Capitalized
terms not defined herein shall have the meanings assigned to them in the Credit
Agreement.)
In reliance upon the representations in the Request Letter and our
understanding that the Acquisition will be effected by a merger (the "Merger')
of a newly organized wholly owned subsidiary of the Company with and into the
publicly held target company (whereupon such target company will become a wholly
owned subsidiary of the Company), and subject to the terms and limitations
hereof: (i) the Banks hereby consent to a limited waiver of the provisions of
Section 7.03 of the Credit Agreement to the extent that Section 7.03 would
prohibit the Company from effecting the Acquisition by means of the Merger and
hereby waive any Default or Event of Default arising solely due to a breach of
Section 7.03 of the Credit Agreement as a result of the Merger, and (ii) the
Banks hereby consent to a limited waiver of the provisions of Section 7.05 of
the Credit Agreement to the extent that Section 7.05 would prohibit the Company
from using Loan proceeds to effectuate the Acquisition and hereby waive any
Default or Event of Default arising solely due to a breach of Section 7.05 of
the Credit Agreement as a result of the use of Loan proceeds to effectuate the
Acquisition.
<PAGE>
Re: Louisiana-Pacific Corporation
January 14, 1999
Page 2
This waiver is limited to the transaction described hereby and shall not
(i) except as expressly waived and consented to hereby, waive any Default or
Event of Default otherwise arising out of the Acquisition (whether similar or
dissimilar and including any cross-default arising as a result thereof) nor (ii)
be deemed to create a course of dealing or otherwise obligate the Banks to enter
into other waivers in the future, whether under the same, similar or different
circumstances.
The effectiveness of this waiver is subject to the following conditions:
(1) each of the representations in the Request Letter shall be true and correct
in all material respects as of the date hereof and as of the date of
consummation of the Acquisition; (2) immediately after giving effect to the
Acquisition, there shall be no Default or Event of Default (except as expressly
waived hereby) and the Company shall be in pro forma compliance with Section
7.01 of the Credit Agreement; (3) the Acquisition and the use of the Loan
proceeds therefore are undertaken in accordance with all applicable Requirements
of Law (including Regulation U of the FRB); (4) the prior, effective written
consent or approval to the Acquisition of the board of directors of the acquiree
is obtained; and (5) the Agent shall have received an executed counterpart of
this letter from each of the Company and the Majority Banks (including by
facsimile transmission, which shall be deemed to be an original for all
purposes, the Agent being authorized by the parties to make sufficient copies of
such facsimile signature pages to assemble counterparts for each of the
parties). This waiver may be executed in counterparts, and by each party on
separate counterparts, all of which when taken together shall constitute one and
the same instrument. The parties acknowledge that the Term Commitment has been
terminated and the Term Loans have been repaid; accordingly, the Term Borrower
is not a party hereto.
Yours truly,
Bank of America National Trust and
Savings Association, as Agent
/s/ Carl F. Fye
Carl F. Fye
Vice President
<PAGE>
Re: Louisiana-Pacific Corporation
January 14, 1999
Page 3
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent and Bank
By: /s/ Michael J. Balok
-----------------------------------
Name: Michael J. Balok
---------------------------------
Title: Managing Director
--------------------------------
Agreed to:
LOUISIANA-PACIFIC CORPORATION
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
- --------------------------------------
NAME OF INSTITUTION
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
<PAGE>
Re: Louisiana-Pacific Corporation
January 14, 1999
Page 3
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent and Bank
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
Agreed to:
LOUISIANA-PACIFIC CORPORATION
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
The Bank of New York
- --------------------------------------
NAME OF INSTITUTION
By: /s/ Robert Louk
-----------------------------------
Name: Robert Louk
---------------------------------
Title: Vice President
--------------------------------
<PAGE>
Re: Louisiana-Pacific Corporation
January 14, 1999
Page 3
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent and Bank
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
Agreed to:
LOUISIANA-PACIFIC CORPORATION
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
ABN AMRO Bank
- --------------------------------------
NAME OF INSTITUTION
By: /s/ David McGinnis
-----------------------------------
Name: David McGinnis
---------------------------------
Title: Vice President
--------------------------------
By: /s/ Leif H. Olsson
-----------------------------------
Name: Leif H. Olsson
---------------------------------
Title: Senior Vice President
--------------------------------
<PAGE>
Re: Louisiana-Pacific Corporation
January 14, 1999
Page 3
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent and Bank
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
Agreed to:
LOUISIANA-PACIFIC CORPORATION
By: /s/ Curtis M. Stevens
-----------------------------------
Name: Curtis M. Stevens
---------------------------------
Title: Vice President, Treasurer & CFO
--------------------------------
By: /s/ Lynn L. Miller
-----------------------------------
Name: Lynn L. Miller
---------------------------------
Title: Assistant Treasurer
--------------------------------
- --------------------------------------
NAME OF INSTITUTION
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
<PAGE>
Re: Louisiana-Pacific Corporation
January 14, 1999
Page 3
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent and Bank
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
Agreed to:
LOUISIANA-PACIFIC CORPORATION
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
Chase Manhattan Bank
- --------------------------------------
NAME OF INSTITUTION
By: /s/ Lenard Weiner
-----------------------------------
Name: Lenard Weiner
---------------------------------
Title: Managing Director
--------------------------------
<PAGE>
Re: Louisiana-Pacific Corporation
January 14, 1999
Page 3
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent and Bank
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
Agreed to:
LOUISIANA-PACIFIC CORPORATION
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
The First National Bank of Chicago
- --------------------------------------
NAME OF INSTITUTION
By: /s/ Mark A. Isley
-----------------------------------
Name: Mark A. Isley
---------------------------------
Title: First Vice President
--------------------------------
<PAGE>
Re: Louisiana-Pacific Corporation
January 14, 1999
Page 3
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent and Bank
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
Agreed to:
LOUISIANA-PACIFIC CORPORATION
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
Wachovia Bank, N.A.
- --------------------------------------
NAME OF INSTITUTION
By: /s/ David L. Corts
-----------------------------------
Name: David L. Corts
---------------------------------
Title: Vice President
--------------------------------
<PAGE>
Re: Louisiana-Pacific Corporation
January 14, 1999
Page 3
BANK OF AMERICA NATIONAL TRUST AND
SAVINGS ASSOCIATION, as Agent and Bank
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
Agreed to:
LOUISIANA-PACIFIC CORPORATION
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
By:
-----------------------------------
Name:
---------------------------------
Title:
--------------------------------
U.S. Bank National Association
- --------------------------------------
NAME OF INSTITUTION
By: /s/ Gayle Burgess
-----------------------------------
Name: Gayle Burgess
---------------------------------
Title: Asst. Relationship Manager
--------------------------------
<PAGE>
Exhibit 99(b)(3)
[LETTERHEAD OF LOUISIANA-PACIFIC CORPORATION]
January 13, 1999
Mr. Chris Gernhard Personal & Confidential
Vice President
Bank of America
555 California Street
San Francisco, CA 94104
Dear Chris,
Louisiana-Pacific Corporation is in the process of negotiating the purchase, for
cash, of all of the outstanding shares of a public company. Our current schedule
targets the signing of the share purchase and merger agreements and a public
announcement of the transaction early next week. Our goal is to be able to say
that our offer to purchase is not subject to any financing contingency.
We are planning on using funds available under our current credit agreement to
fund the share purchase. We have reviewed the credit agreement and are concerned
that the purchase of the above mentioned shares would violate paragraph 7.03 and
7.05 of the credit agreement. On a proforma basis, we are in compliance with
all other aspects of the agreement, including the financial covenant. We request
that you secure the necessary approvals from your bank and the other banks in
the credit agreement syndicate to provide the necessary waivers.
It is our intention to began discussions with BofA/NationsBanc Montgomery
Securities and our financial advisor about putting into place more appropriate,
longer-term financing to replace the funds used under the current credit
agreement.
The target is a publicly-traded building materials company. The target has one
shareholder that holds nearly 50% of the shares. This transaction is being
negotiated amongst L-P, target's management and the large shareholder on a
friendly basis and we would only proceed on that basis. Based on discussions to
date, the estimated total transaction value, including debt of $50 million,
would be $220-230 million.
The nature of the target's business is an excellent strategic fit with L-P in
terms of the nature of products sold and the customer and channels served. We
see quite a lot of good synergies in combining L-P and the target. They also
have an excellent management team. The company's sales in recent years have
ranged from $300-325 million and they have been profitable ($15-20 million).
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The target has exposure to a product liability claims and litigation. L-P's
business people and legal people have done extensive due diligence on this
matter. Based on this review, we do not believe this is a material exposure.
Either I or Curt Stevens would be happy to answer any questions you may have
regarding this proposed transaction. Obviously everything discussed in this
letter is highly confidential and should only be used and discussed for purposes
of making the necessary credit decisions.
Sincerely,
/s/ William L. Hebert
William L. Hebert
Director, Business Development
CC: Curt Stevens
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Exhibit 99(c)(1)
EXECUTION COPY
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AGREEMENT AND PLAN OF MERGER
among
LOUISIANA-PACIFIC CORPORATION
STRIPER ACQUISITION, INC.
and
ABT BUILDING PRODUCTS CORPORATION
dated as of January 19, 1999
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TABLE OF CONTENTS
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ARTICLE I
THE OFFER..............................................................................................1
Section 1.1 The Offer.....................................................................1
Section 1.2 Offer Documents...............................................................2
Section 1.3 Company Actions...............................................................3
Section 1.4 Directors.....................................................................4
ARTICLE II
THE MERGER.............................................................................................5
Section 2.1 The Merger....................................................................5
Section 2.2 Closing.......................................................................5
Section 2.3 Effective Time................................................................5
Section 2.4 Effects of the Merger.........................................................5
Section 2.5 Certificate of Incorporation; Bylaws..........................................5
Section 2.6 Directors; Officers...........................................................6
ARTICLE III
EFFECT OF THE MERGER ON THE CAPITAL STOCK
OF THE CONSTITUENT CORPORATIONS; EXCHANGE OF CERTIFICATES..............................................6
Section 3.1 Effect on Capital Stock.......................................................6
Section 3.2 Stock Options.................................................................7
Section 3.3 Payment for Shares............................................................8
ARTICLE IV
REPRESENTATIONS AND WARRANTIES.........................................................................9
Section 4.1 Representations and Warranties of Company.....................................9
Section 4.2 Representations and Warranties of Parent and Merger Sub......................21
ARTICLE V
CONDUCT OF BUSINESS OF COMPANY........................................................................24
Section 5.1 Conduct of Business of Company...............................................24
ARTICLE VI
ADDITIONAL COVENANTS..................................................................................26
Section 6.1 Company Stockholders Meeting; Preparation of the Proxy
Statement; Short-Form Merger........................................................26
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(i)
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Section 6.2 Access to Information; Confidentiality.......................................27
Section 6.3 Reasonable Best Efforts......................................................27
Section 6.4 Public Announcements.........................................................27
Section 6.5 No Solicitation; Acquisition Proposals.......................................27
Section 6.6 Consents, Approvals and Filings..............................................29
Section 6.7 Employee Benefit Matters.....................................................29
Section 6.8 Indemnification; Directors' and Officers' Insurance..........................30
ARTICLE VII
CONDITIONS PRECEDENT..................................................................................32
Section 7.1 Conditions to Each Party's Obligation to Effect the Merger...................32
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER.....................................................................32
Section 8.1 Termination..................................................................32
Section 8.2 Effect of Termination........................................................34
Section 8.3 Amendment....................................................................34
Section 8.4 Extension; Waiver............................................................34
Section 8.5 Procedure for Termination, Amendment, Extension or Waiver....................34
ARTICLE IX
GENERAL PROVISIONS....................................................................................35
Section 9.1 Nonsurvival of Representations and Warranties................................35
Section 9.2 Fees and Expenses............................................................35
Section 9.3 Definitions..................................................................35
Section 9.4 Notices......................................................................36
Section 9.5 Interpretation...............................................................37
Section 9.6 Entire Agreement; Third-Party Beneficiaries..................................37
Section 9.7 Governing Law................................................................37
Section 9.8 Assignment...................................................................37
Section 9.9 Enforcement..................................................................38
Section 9.10 Severability.................................................................38
Section 9.11 Counterparts.................................................................38
EXHIBIT A - Conditions to the Offer
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(ii)
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AGREEMENT AND PLAN OF MERGER
This AGREEMENT AND PLAN OF MERGER, dated as of January 19, 1999 (this
"Agreement"), is made and entered into among Louisiana-Pacific Corporation, a
Delaware corporation ("Parent"), Striper Acquisition, Inc., a Delaware
corporation and wholly owned subsidiary of Parent ("Merger Sub"), and ABT
Building Products Corporation, a Delaware corporation ("Company").
RECITALS:
A. The respective Boards of Directors of Parent, Merger Sub and Company
have determined that it would be advisable and in the best interests of their
respective stockholders for Parent to acquire Company, by means of a merger of
Merger Sub with and into Company (the "Merger"), on the terms and subject to the
conditions set forth in this Agreement.
B. To effectuate the acquisition, Parent and Company each desire that
Parent cause Merger Sub to commence a cash tender offer to purchase all of the
outstanding shares of common stock, par value $0.01 per share (the "Company
Common Stock"), of Company (the "Shares") on the terms and subject to the
conditions set forth in this Agreement and the Board of Directors of Company has
approved such tender offer and is recommending (subject to the limitations
contained herein) that Company's stockholders accept the tender offer and tender
their Shares pursuant thereto.
C. Concurrently with the execution and delivery of this Agreement and
as a condition to Parent's and Merger Sub's willingness to enter into this
Agreement, Parent has entered into a Stockholder Agreement, dated as of the date
hereof (the "Stockholder Agreement"), with each of the Principal Stockholders
(as defined in Section 9.3), pursuant to which each Principal Stockholder has
(i) agreed, among other things, to tender all Shares owned by such Principal
Stockholder pursuant to the Offer (as defined in Section 1.1) and (ii) granted
to Parent an option to purchase all Shares owned by such Principal Stockholder.
D. Parent, Merger Sub and Company desire to make certain
representations and warranties and to enter into certain covenants in connection
with the Offer and the Merger and also to prescribe various conditions to the
consummation thereof;
NOW, THEREFORE, in consideration of the representations, warranties and
covenants contained in this Agreement, the parties hereto hereby agree as
follows:
ARTICLE I
THE OFFER
Section 1.1 THE OFFER. (a) Provided that none of the events set forth
in Exhibit A hereto shall have occurred and be continuing, as promptly as
practicable (but in any event not later than five business days after the public
announcement of the execution and delivery of this
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Agreement), Parent shall cause Merger Sub to commence (within the meaning of
Rule 14d-2 under the Securities Exchange Act of 1934, as amended, and the rules
and regulations promulgated thereunder (the "Exchange Act")), an offer to
purchase (the "Offer") all outstanding shares of Company Common Stock at a price
of $15.00 per share, net to the seller in cash (such price or any higher price
as paid pursuant to the Offer, the "Offer Consideration"). Notwithstanding the
foregoing, if between the date of this Agreement and the Effective Time the
outstanding Shares shall have been changed into a different number of shares or
a different class, by reason of any stock dividend, subdivision,
reclassification, recapitalization, split, combination or exchange of shares,
the Offer Consideration shall be correspondingly adjusted on a per-share basis
to reflect such stock dividend, subdivision, reclassification, recapitalization,
split, combination or exchange of shares. The obligation of Parent and Merger
Sub to commence the Offer, to consummate the Offer and to accept for payment and
to pay for Shares validly tendered in the Offer and not withdrawn shall be
subject only to those conditions set forth in Exhibit A hereto. The Offer shall
initially expire 20 business days after the date of its commencement.
(b) Without the prior written consent of Company, Merger Sub
shall not (and Parent shall cause Merger Sub not to) (i) decrease or change the
form of the Offer Consideration or decrease the number of Shares sought pursuant
to the Offer, (ii) amend any term of the Offer in any manner adverse to holders
of Shares, (iii) change the conditions to the Offer, (iv) impose additional
conditions to the Offer, (v) waive the condition that there shall be validly
tendered and not withdrawn prior to the time the Offer expires a number of
Shares (together with any Shares then owned by Parent or any of its
Subsidiaries) which constitutes a majority of the Shares outstanding on a
fully-diluted basis on the date of purchase ("on a fully-diluted basis" meaning,
as of any date, the number of Shares outstanding (excluding any Shares held as
treasury stock by Company or any of its Subsidiaries), together with the Shares
which Company may be required to issue pursuant to obligations outstanding at
that date under employee stock or similar benefit plans or otherwise (other than
unvested Options), or (vi) extend the expiration date of the Offer beyond the
initial expiration date of the Offer (except that Merger Sub may, without the
consent of Company, (A) extend the Offer, if at the then scheduled expiration
date of the Offer any of the conditions to Merger Sub's obligation to purchase
Shares is not satisfied, until such time as such condition is satisfied or
waived, and (B) extend the Offer for any period required by any rule,
regulation, interpretation or position of the United States Securities and
Exchange Commission (the "SEC") or the staff thereof); provided, however, that,
except as set forth above and subject to applicable legal requirements, Merger
Sub may amend the Offer or waive any condition to the Offer in its sole
discretion. Assuming the prior satisfaction or waiver of the conditions to the
Offer set forth in Exhibit A hereto, Merger Sub shall, and Parent shall cause
Merger Sub to, accept for payment, and pay for all Shares validly tendered and
not withdrawn pursuant to the Offer as soon as practicable after the expiration
date thereof.
(c) Parent shall provide or cause to be provided to Merger Sub
on a timely basis the funds necessary to purchase any Shares that Merger Sub
becomes obligated to purchase pursuant to the Offer and shall be liable on a
direct and primary basis for the performance by Merger Sub of its obligations
under this Agreement.
Section 1.2 OFFER DOCUMENTS. (a) As soon as practicable on the date of
commencement of the Offer, Parent and Merger Sub shall file or cause to be filed
with the SEC a
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Tender Offer Statement on Schedule 14D-1 (together with any supplements or
amendments thereto, the "Schedule 14D-1") with respect to the Offer which shall
comply as to form in all material respects with the provisions of applicable
federal securities laws, shall contain the offer to purchase and related letter
of transmittal and other ancillary Offer documents and instruments pursuant to
which the Offer will be made (collectively with the Schedule 14D-1, and with any
supplements or amendments thereto, the "Offer Documents") and shall be mailed to
the holders of Shares. Company will promptly supply to Parent and Merger Sub in
writing, for inclusion in the Offer Documents, all information concerning
Company required under the Exchange Act to be included in the Offer Documents.
(b) Each of Parent, Merger Sub and Company shall promptly
correct any information provided by them for use in the Offer Documents if and
to the extent that such information shall be or have become false or misleading
in any material respect, and Parent and Merger Sub shall take all lawful action
necessary to cause the Offer Documents as so corrected to be filed promptly with
the SEC and to be disseminated to holders of Shares as and to the extent
required by applicable law. In conducting the Offer, Parent and Merger Sub shall
comply in all material respects with the provisions of the Exchange Act and any
other applicable law. Company and its counsel shall be given a reasonable
opportunity to review and comment on the Offer Documents and any amendments
thereto prior to the filing thereof with the SEC.
Section 1.3 COMPANY ACTIONS. (a) Company hereby consents to the Offer
and represents and warrants that (i) its Board of Directors (at a meeting duly
called and held) has (A) determined that each of this Agreement, the Offer and
the Merger are fair to and in the best interests of Company and its
stockholders, (B) approved and declared the advisability of this Agreement and
the transactions contemplated hereby, including the Offer and the Merger, and
(C) resolved (subject to the limitations herein contained) to recommend
acceptance of the Offer and adoption of this Agreement by the holders of Shares,
and (ii) Warburg Dillon Read LLC ("WDR") has delivered to the Board of Directors
of Company its opinion that the Offer Consideration to be received by the
holders of Shares in the Offer is fair, from a financial point of view, to such
holders. Subject to the provisions of Section 6.5(b), Company hereby consents to
the inclusion in the Offer Documents of the recommendations of the Board of
Directors of Company in favor of the Offer and the adoption of this Agreement.
(b) Company shall file with the SEC, simultaneously with the
filing by Parent and Merger Sub of the Schedule 14D-1, a Solicitation
Recommendation Statement on Schedule 14D-9 (together with any supplements or
amendments thereto, the "Schedule 14D-9") containing, subject to the provisions
of Section 6.5(b), the recommendations of the Board of Directors of Company in
favor of the Offer and the adoption of this Agreement. Each of Parent and Merger
Sub will promptly supply to Company in writing, for inclusion in the Schedule
14D-9, all information concerning Parent's Designees (as such term is defined in
Section 1.4 hereof), as required by Section 14(f) of the Exchange Act and Rule
14f-1 thereunder, and Company shall include such information in the Schedule
14D-9. Each of Company, Parent and Merger Sub shall promptly correct any
information provided by them for use in the Schedule 14D-9 if and to the extent
that such information shall be or have become false or misleading in any
material respect and Company shall take all lawful action necessary to cause the
Schedule 14D-9 as so corrected to be filed promptly with the SEC and
disseminated to the holders of
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Shares as and to the extent required by applicable law. Parent, Merger Sub and
their counsel shall be given a reasonable opportunity to review the Schedule
14D-9 and any amendments thereto prior to the filing thereof with the SEC.
(c) In connection with the Offer, Company shall promptly
furnish Parent with (or cause Parent to be furnished with) mailing labels,
security position listings and all available listings or computer files
containing the names and addresses of the record holders of Shares as of the
latest practicable date and shall furnish Parent with (or cause Parent to be
furnished with) such information and assistance (including updated lists of
stockholders, mailing labels and lists of security positions) as Parent or its
agents may reasonably request in communicating the Offer to the record and
beneficial holders of Shares. Subject to the requirements of applicable law, and
except for such actions as are necessary to disseminate the Offer Documents and
any other documents necessary to consummate the Offer and the Merger, Parent and
Merger Sub and each of their affiliates, associates, partners, employees, agents
and advisors shall hold in confidence the information contained in such labels,
lists and files, shall use such information only in connection with the Offer
and the Merger and, if this Agreement is terminated in accordance with its
terms, shall deliver promptly to Company (or destroy and certify to Company the
destruction of) all copies of such information (and any copies, compilations or
extracts thereof or based thereon) then in their possession or under their
control.
Section 1.4 DIRECTORS. (a) Promptly upon the purchase by Merger Sub
pursuant to the Offer of such number of shares of Company Common Stock (together
with any Shares then owned by Parent or any of its Subsidiaries) as represents a
majority of the outstanding shares of Company Common Stock (on a fully diluted
basis) on the date of purchase, and from time to time thereafter, (i) Parent
shall be entitled to designate such number of directors ("Parent's Designees"),
rounded up to the next whole number that will give Parent, subject to compliance
with Section 14(f) of the Exchange Act, representation on the Board of Directors
of Company equal to the product of (x) the number of directors on the Board of
Directors of Company (giving effect to any increase in the number of directors
pursuant to this Section 1.4) and (y) the percentage that such number of shares
of Company Common Stock so purchased in the Offer (together with any Shares then
owned by Parent or any of its Subsidiaries) bears to the aggregate number of
shares of Company Common Stock outstanding on the date of purchase (such number
being, the "Board Percentage"), and (ii) Company shall, upon request by Parent,
promptly cause Parent's Designees constituting the Board Percentage to be
elected to Company's Board of Directors by (x) increasing the size of the Board
of Directors of Company or (y) using reasonable efforts to secure the
resignations of such number of directors as is necessary to enable Parent's
Designees to be elected to the Board of Directors of Company and shall use best
efforts to cause Parent's Designees promptly to be so elected, subject in all
instances to compliance with Section 14(f) of the Exchange Act and Rule 14f-1
promulgated thereunder. At the request of Parent, Company shall take, at
Parent's expense, all lawful action necessary to effect any such election.
Parent will supply to Company in writing and be solely responsible for any
information with respect to itself, Parent's Designees and Parent's officers,
directors and affiliates required by the Section 14(f) of the Exchange Act and
Rule 14f-1 promulgated thereunder to be included in the Schedule 14D-9.
Notwithstanding the foregoing, at all times prior to the Effective Time (as
defined in Section 2.3) Company's Board of Directors shall include at least two
Continuing Directors (as defined in Section 1.4(b)).
4
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(b) Following the election or appointment of Parent's
Designees pursuant to this Section 1.4 and prior to the Effective Time of the
Merger, any amendment or termination of this Agreement, waiver of the
obligations or other acts of Parent or Merger Sub or waiver of Company's rights
hereunder shall require the concurrence of a majority of the Continuing
Directors then in office. For purposes of this Agreement, the term "Continuing
Directors" means at any time (i) those directors of Company who are directors on
the date hereof and who voted to approve this Agreement, and (ii) such
additional directors of Company who are not affiliated with Parent, Merger Sub
or any of their affiliates and who were designated as "Continuing Directors" for
purposes of this Agreement by a majority of the Continuing Directors in office
at the time of such designation.
ARTICLE II
THE MERGER
Section 2.1 THE MERGER. On the terms and subject to the conditions set
forth in this Agreement, and in accordance with the Delaware General Corporation
Law (the "DGCL"), the Merger shall be effected and Merger Sub shall be merged
with and into Company at the Effective Time. At the Effective Time, the separate
existence of Merger Sub shall cease and Company shall continue as the surviving
corporation (as such, the "Surviving Corporation").
Section 2.2 CLOSING. Unless this Agreement shall have been terminated
and the transactions contemplated hereby shall have been abandoned pursuant to
Article VIII, and subject to the satisfaction or waiver of all of the conditions
set forth in Article VII, the closing of the Merger (the "Closing") will take
place as soon as practicable, but in no event later than 10:00 a.m. on the
second business day (the "Closing Date") following satisfaction or waiver of all
of the conditions set forth in Article VII, other than those conditions that by
their nature are to be satisfied at the Closing, but subject to the fulfillment
or waiver of those conditions, at the offices of Jones, Day, Reavis & Pogue, 599
Lexington Avenue, New York, New York, unless another date, time or place is
agreed to in writing by the parties hereto.
Section 2.3 EFFECTIVE TIME. On the Closing Date (or on such other date
as Parent and Company may agree), the parties hereto shall file with the
Secretary of State of the State of Delaware (the "Delaware State Secretary") a
certificate of merger and any other appropriate documents, executed in
accordance with the relevant provisions of the DGCL, and shall make all other
filings or recordings required under the DGCL in connection with the Merger. The
Merger shall become effective upon the filing of the certificate of merger with
the Delaware State Secretary, or at such later time as is specified in the
certificate of merger (the "Effective Time").
Section 2.4 EFFECTS OF THE MERGER. The Merger shall have the effects
set forth in the applicable provisions of the DGCL. Without limiting the
generality of the foregoing, and subject thereto, at the Effective Time, all
property of Company and Merger Sub shall vest in the Surviving Corporation, and
all liabilities and obligations of Company and Merger Sub shall become
liabilities and obligations of the Surviving Corporation.
5
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Section 2.5 CERTIFICATE OF INCORPORATION; BYLAWS. At the Effective
Time, (a) the certificate of incorporation of Merger Sub as in effect at the
Effective Time shall, from and after the Effective Time, be the certificate of
incorporation of the Surviving Corporation until thereafter changed or amended
in accordance with the provisions thereof and applicable law and (b) the bylaws
of Merger Sub as in effect at the Effective Time shall, from and after the
Effective Time, be the bylaws of the Surviving Corporation until thereafter
changed or amended in accordance with the provisions thereof and applicable law.
Section 2.6 DIRECTORS; OFFICERS. From and after the Effective Time, (a)
the directors of Merger Sub shall be the directors of the Surviving Corporation,
until the earlier of their resignation or removal or until their respective
successors are duly elected and qualified, as the case may be, and (b) the
officers of Merger Sub shall be the officers of the Surviving Corporation, until
the earlier of their resignation or removal or until their respective successors
are duly elected and qualified, as the case may be.
ARTICLE III
EFFECT OF THE MERGER ON THE CAPITAL STOCK
OF THE CONSTITUENT CORPORATIONS; EXCHANGE OF CERTIFICATES
Section 3.1 EFFECT ON CAPITAL STOCK. At the Effective Time, by virtue
of the Merger and without any action on the part of any holder of Shares or any
other shares of capital stock of Company or Merger Sub:
(a) COMMON STOCK OF MERGER SUB. Each share of common stock,
par value $0.01 per share, of Merger Sub issued and outstanding immediately
prior to the Effective Time shall be converted into and become one validly
issued, fully paid and nonassessable share of common stock, par value $0.01 per
share, of the Surviving Corporation.
(b) CANCELLATION OF TREASURY SHARES AND PARENT-OWNED SHARES.
Each Share issued and outstanding immediately prior to the Effective Time that
is owned by Company or any Subsidiary (as defined in Section 9.3) of Company or
by Parent, Merger Sub or any other Subsidiary of Parent (other than shares in
trust accounts, managed accounts, custodial accounts and the like that are
beneficially owned by third parties) shall automatically be canceled and retired
and shall cease to exist, and no cash or other consideration shall be delivered
or deliverable in exchange therefor.
(c) CONVERSION OF SHARES. Each share of Company Common Stock
issued and outstanding immediately prior to the Effective Time (other than
Shares to be canceled and retired in accordance with Section 3.1(b) and any
Dissenting Shares (as defined in Section 3.1(d)) shall be converted into the
right to receive the Offer Consideration, payable in cash to the holder thereof,
without any interest thereon (the "Merger Consideration"), in accordance with
Section 3.3. Notwithstanding the foregoing, if between the date of this
Agreement and the Effective Time the outstanding Shares shall have been changed
into a different number of shares or a different class, by reason of any stock
dividend, subdivision, reclassification,
6
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recapitalization, split, combination or exchange of shares, the Merger
Consideration shall be correspondingly adjusted on a per-share basis to reflect
such stock dividend, subdivision, reclassification, recapitalization, split,
combination or exchange of shares.
(d) DISSENTING SHARES. Notwithstanding anything in this
Agreement to the contrary, Shares issued and outstanding immediately prior to
the Effective Time held by any person who has the right to demand, and who
properly demands, an appraisal of such Shares ("Dissenting Shares") in
accordance with Section 262 of the DGCL (or any successor provision) shall not
be converted into a right to receive the Merger Consideration unless such holder
fails to perfect or otherwise loses such holder's right to such appraisal, if
any. If, after the Effective Time, such holder fails to perfect or loses any
such right to appraisal, each such Share of such holder shall be treated as a
Share that had been converted as of the Effective Time into the right to receive
the Merger Consideration in accordance with Section 3.1(c). At the Effective
Time, any holder of Dissenting Shares shall cease to have any rights with
respect thereto, except the rights provided in Section 262 of the DGCL (or any
successor provision) and as provided in the immediately preceding sentence.
Company shall give prompt notice to Parent of any demands received by Company
for appraisal of Shares, and Parent shall have the right to participate in and
direct all negotiations and proceedings with respect to such demands. Company
shall not, except with the prior written consent of Parent, make any payment
with respect to, or settle or offer to settle, any such demands.
Section 3.2 STOCK OPTIONS.
(a) At the Effective Time, each holder of a then-outstanding
option to purchase Shares under Company's Amended and Restated Stock Option
Plan, 1994 Director Stock Option Plan, 1994 Employee Stock Option Plan and new
employee compensation policy (collectively, the "Stock Option Plans") (true and
correct copies of which have been delivered or made available by Company to
Parent), whether or not then exercisable (the "Options"), shall, in settlement
thereof, receive for each Share subject to such Option an amount (subject to any
applicable withholding tax) in cash equal to the difference between the Merger
Consideration and the per Share exercise price of such Option to the extent such
difference is a positive number (such amount being hereinafter referred to as,
the "Option Consideration"); provided, however, that with respect to any person
subject to Section 16(a) 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. Upon receipt of the
Option Consideration therefor, each Option shall be canceled. The surrender of
an Option to Company in exchange for the Option Consideration shall be deemed a
release of any and all rights the holder had or may have had in respect of such
Option.
(b) Prior to the Effective Time, Company shall use its
reasonable best efforts to obtain all necessary consents or releases from
holders of Options under the Stock Option Plans and take all such other lawful
action as may be necessary to give effect to the transactions contemplated by
this Section 3.2. Except as otherwise agreed to by the parties, (i) the Stock
Option Plans shall terminate as of the Effective Time and the provisions in any
other plan, program or arrangement providing for the issuance or grant of any
other interest in respect of the
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capital stock of Company or any Subsidiary thereof shall be canceled as of the
Effective Time and (ii) Company shall use its reasonable best efforts to assure
that following the Effective Time no participant in the Stock Option Plans or
other plans, programs or arrangements shall have any right thereunder to acquire
any equity securities of Company, the Surviving Corporation or any Subsidiary
thereof and to terminate all such plans.
Section 3.3 PAYMENT FOR SHARES.
(a) PAYMENT FUND. Concurrently with the Effective Time, Parent
shall deposit, or shall cause to be deposited, with or for the account of a bank
or trust company designated by Parent, which shall be reasonably satisfactory to
Company (the "Paying Agent"), for the benefit of the holders of Shares, cash in
an amount sufficient to pay the aggregate Merger Consideration payable upon the
conversion of Shares pursuant to Section 3.1(c) (the "Payment Fund").
(b) LETTERS OF TRANSMITTAL; SURRENDER OF CERTIFICATES. As soon
as reasonably practicable after the Effective Time, Parent shall instruct the
Paying Agent to mail to each holder of record (other than Company or any of its
Subsidiaries or Parent, Merger Sub or any other Subsidiary of Parent) of a
certificate or certificates that, immediately prior to the Effective Time,
evidenced outstanding Shares (the "Certificates"), (i) a form of letter of
transmittal (which shall specify that delivery shall be effected, and risk of
loss and title to the Certificates shall pass, only upon proper delivery of the
Certificates to the Paying Agent, and shall be in such form and have such other
provisions as Parent may reasonably specify) and (ii) instructions for use in
effecting the surrender of the Certificates in exchange for the Merger
Consideration. Upon surrender of a Certificate for cancellation to the Paying
Agent together with such letter of transmittal, duly executed, and such other
customary documents as may be required pursuant to such instructions, the holder
of such Certificate shall be entitled to receive in exchange therefor cash in an
amount equal to the product of (i) the number of Shares theretofore represented
by such Certificate and (ii) the Merger Consideration, and the Certificate so
surrendered shall forthwith be canceled. No interest shall be paid or accrued on
any cash payable upon the surrender of any Certificate. If payment is to be made
to a person other than the person in whose name the surrendered Certificate is
registered, it shall be a condition of payment that the Certificate so
surrendered shall be properly endorsed or otherwise in proper form for transfer
and that the person requesting such payment shall pay any transfer or other
taxes required by reason of the payment to a person other than the registered
holder of the surrendered Certificate or established to the satisfaction of
Parent and the Surviving Corporation that such taxes have been paid or are not
applicable.
(c) CANCELLATION AND RETIREMENT OF SHARES; NO FURTHER RIGHTS.
As of the Effective Time, all Shares (other than Shares to be canceled in
accordance with Section 3.1(b)) issued and outstanding immediately prior to the
Effective Time shall cease to be outstanding and shall automatically be canceled
and retired and shall cease to exist, and each holder of any such Shares shall
cease to have any rights with respect thereto or arising therefrom (including
without limitation the right to vote), except the right to receive the Merger
Consideration, without interest, upon surrender of such Certificate in
accordance with Section 3.3(b), and until so surrendered, each such Certificate
shall represent for all purposes only the right to receive the Merger
Consideration, without interest. The Merger Consideration paid upon the
surrender for
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exchange of Certificates in accordance with the terms of this Section 3.3 shall
be deemed to have been paid in full satisfaction of all rights pertaining to the
Shares theretofore represented by such Certificates.
(d) INVESTMENT OF PAYMENT FUND. The Paying Agent shall invest
the Payment Fund, as directed by Parent, in (i) direct obligations of the United
States of America, (ii) obligations for which the full faith and credit of the
United States of America is pledged to provide for the payment of principal and
interest, (iii) commercial paper rated the highest quality by either Moody's
Investors Services, Inc. or Standard & Poor's Corporation, or (iv) certificates
of deposit, bank repurchase agreements or bankers' acceptances of commercial
banks with capital exceeding $500 million. Any net earnings with respect to the
Payment Fund shall be the property of and paid over to Parent as and when
requested by Parent.
(e) TERMINATION OF PAYMENT FUND. Any portion of the Payment
Fund which remains undistributed to the holders of Certificates for 180 days
after the Effective Time shall be delivered to Parent, upon demand, and any
holders of Certificates that have not theretofore complied with this Section 3.3
shall thereafter look only to Parent, and only as general creditors thereof, for
payment of their claim for any Merger Consideration.
(f) NO LIABILITY. None of Parent, Merger Sub, the Surviving
Corporation or the Paying Agent shall be liable to any person in respect of any
payments or distributions payable from the Payment Fund delivered to a public
official pursuant to any applicable abandoned property, escheat or similar law.
If any Certificates shall not have been surrendered prior to five years after
the Effective Time (or immediately prior to such earlier date on which any
Merger Consideration in respect of such Certificate would otherwise escheat to
or become the property of any Governmental Entity (as defined in Section
4.1(c)), any amounts payable in respect of such Certificate shall, to the extent
permitted by applicable law, become the property of the Surviving Corporation,
free and clear of all claims or interest of any person previously entitled
thereto.
(g) WITHHOLDING RIGHTS. Parent shall be entitled to deduct and
withhold, or cause to be deducted or withheld, from the consideration otherwise
payable pursuant to this Agreement to any holder of Shares, Options or
Certificates such amounts as are required to be deducted and withheld with
respect to the making of such payment under the Internal Revenue Code of 1986,
as amended (the "Code"), or any provision of applicable state, local or foreign
tax law. To the extent that amounts are so deducted and withheld, such deducted
and withheld amounts shall be treated for all purposes of this Agreement as
having been paid to such holders in respect of which such deduction and
withholding was made.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.1 REPRESENTATIONS AND WARRANTIES OF COMPANY. Company
represents and warrants to Parent and Merger Sub as follows:
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(a) ORGANIZATION, STANDING AND CORPORATE POWER. Each of
Company and each Subsidiary of Company is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction in which it is
incorporated and has the requisite corporate power and authority to carry on its
business as now being conducted. Each of Company and each Subsidiary of Company
is duly qualified or licensed to do business and is in good standing in each
jurisdiction in which the nature of its business or the ownership or leasing of
its properties makes such qualification or licensing necessary, other than in
such jurisdictions where the failure to be so qualified or licensed would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect (as defined in Section 9.3) on Company. Company has delivered or
made available to Parent true, complete and correct copies of the certificate of
incorporation and bylaws or comparable governing documents of Company and each
Subsidiary of Company, in each case as amended to the date of this Agreement. A
true, correct and complete list of all Subsidiaries of Company, together with
the jurisdiction of incorporation of each such Subsidiary and the percentage of
each such Subsidiary's capital stock owned by Company or another Subsidiary, is
set forth in Section 4.1(a) of the Disclosure Schedule (as defined in Section
9.3).
(b) AUTHORITY; NONCONTRAVENTION. Company has the requisite
corporate power and authority to enter into this Agreement and to consummate the
transactions contemplated hereby. The execution and delivery of this Agreement
by Company and the consummation by Company of the transactions contemplated
hereby have been duly authorized by all necessary corporate action on the part
of Company, subject, in the case of the Merger, to the adoption of this
Agreement by its stockholders as contemplated by Section 6.1(a). This Agreement
has been duly executed and delivered by Company and, assuming that this
Agreement constitutes a valid and binding obligation of Parent and Merger Sub,
constitutes a valid and binding obligation of Company, enforceable against
Company in accordance with its terms, subject to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and similar laws
affecting creditors' rights and remedies generally and to general principles of
equity. Except as specified in Section 4.1(b) of the Disclosure Schedule, the
execution and delivery of this Agreement does not, and the consummation of the
transactions contemplated hereby and compliance with the provisions hereof will
not, (i) conflict with any of the provisions of the certificate of incorporation
or bylaws of Company or the comparable governing documents of any Subsidiary of
Company, in each case as amended to the date of this Agreement, (ii) subject to
the governmental filings and other matters referred to in Section 4.1(c),
conflict with, result in a breach of or default (with or without notice or lapse
of time, or both) under, or give rise to a material obligation, a right of
termination, cancellation or acceleration of any obligation or a loss of a
material benefit under, or require the consent of any person under, any
indenture or other agreement, permit, concession, franchise, license or similar
instrument or undertaking to which Company or any of its Subsidiaries is a party
or by which Company or any of its Subsidiaries or any of their respective assets
is bound or affected, or (iii) subject to the governmental filings and other
matters referred to in Section 4.1(c), contravene any domestic or foreign law,
rule or regulation or any order, writ, judgment, injunction, decree,
determination or award currently in effect, which, in the case of clauses (ii)
and (iii) above would reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect on Company.
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(c) CONSENTS AND APPROVALS. No consent, approval or
authorization of, or declaration or filing with, or notice to, any domestic or
foreign governmental agency or regulatory authority (a "Governmental Entity")
which has not been received or made is required by or with respect to Company or
any of its Subsidiaries in connection with the execution and delivery of this
Agreement by Company or the consummation by Company of the transactions
contemplated hereby, except for (i) the filing of premerger notification and
report forms under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended (the "HSR Act"), (ii) the filing with the SEC of (A) the Schedule 14D-9,
the information statement required under Rule 14f-1 of the Exchange Act and, if
required by applicable law, the Proxy Statement (as defined in Section 6.1(b)),
(B) such reports under the Exchange Act as may be required in connection with
this Agreement or the Stockholder Agreement and the transactions contemplated
hereby and thereby, (iii) the filing of the certificate of merger or, if
permitted, a certificate of ownership and merger with the Delaware State
Secretary and appropriate documents with the relevant authorities of other
states in which Company is qualified to do business, (iv) such other consents,
approvals, authorizations, filings or notices as are specified in Section 4.1(c)
of the Disclosure Schedule, (v) applicable environmental statutes, and (vi) any
other consents, approvals, authorizations, filings or notices the failure to
make or obtain which would not reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect on Company.
(d) CAPITAL STRUCTURE. The authorized capital stock of Company
consists solely of (i) 40,000,000 shares of Company Common Stock and (ii)
1,000,000 shares of Preferred Stock, par value $0.01 per share, of Company
("Company Preferred Stock"). At the close of business on January 14, 1999
("Capital Structure Date"): (i) 10,674,160 shares of Company Common Stock were
issued and outstanding, (ii) no shares of Company Preferred Stock were issued
and outstanding, (iii) 2,522,425 shares of Company Common Stock were reserved
for issuance pursuant to outstanding Options granted under the Stock Option
Plans, and (iv) 1,537,000 shares of Company Common Stock were held by Company in
its treasury. Except as set forth in the immediately preceding sentence or on
Section 4.1(d) of the Disclosure Schedule, at the close of business on the
Capital Structure Date, no shares of capital stock or other equity securities of
Company were issued, reserved for issuance or outstanding. Since the close of
business on the Capital Structure Date, no shares of capital stock or other
equity securities of Company have been issued or reserved for issuance or become
outstanding (other than any Shares described in clause (iii) of the first
sentence of this Section 4.1(d) that have been issued upon the exercise of
outstanding Options granted under the Stock Option Plans). All outstanding
shares of capital stock of Company are duly authorized, validly issued, fully
paid and nonassessable and not subject to preemptive rights. Except as specified
above or in Section 4.1(d) of the Disclosure Schedule, neither Company nor any
Subsidiary of Company has or is subject to or bound by or, at or after the
Effective Time will have or be subject to or bound by, any outstanding option,
warrant, call, subscription or other right (including any preemptive right),
agreement or commitment which (i) obligates Company or any Subsidiary of Company
to issue, sell or transfer, or repurchase, redeem or otherwise acquire, any
shares of the capital stock of Company or any Subsidiary of Company, (ii)
restricts the transfer of any shares of capital stock of Company or any of its
Subsidiaries, or (iii) relates to the voting of any shares of capital stock of
Company or any of its Subsidiaries. No bonds, debentures, notes or other
indebtedness of Company or any Subsidiary of Company having the right to vote
(or convertible into, or
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exchangeable for, securities having the right to vote) on any matters on which
the stockholders of Company or any Subsidiary of Company may vote are issued or
outstanding. Except as specified in Section 4.1(d) of the Disclosure Schedule,
all of the outstanding shares of capital stock of each Subsidiary of Company
have been duly authorized, validly issued, fully paid and nonassessable and are
owned by Company, by one or more Subsidiaries of Company or by Company and one
or more such Subsidiaries, free and clear of Liens (as defined in Section 9.3).
(e) SEC DOCUMENTS. Company has filed all required reports,
schedules, forms, statements and other documents with the SEC since December 31,
1996 (such reports, schedules, forms, statements and other documents being
hereinafter referred to as the "SEC Documents"). As of their respective dates,
the SEC Documents complied in all material respects with the requirements of the
Securities Act of 1933, as amended (the "Securities Act"), or the Exchange Act,
as the case may be, and the rules and regulations of the SEC promulgated
thereunder applicable to such SEC Documents, and none of the SEC Documents as of
such dates contained any untrue statements of a material fact or omitted to
state a 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. As of their respective dates, the consolidated financial
statements of Company included in the SEC Documents complied as to form in all
material respects with the published rules and regulations of the SEC with
respect thereto, had been prepared in accordance with generally accepted
accounting principles (except, in the case of unaudited consolidated quarterly
statements, as permitted by Form 10-Q of the SEC) applied on a consistent basis
during the periods involved (except as may otherwise be indicated in the notes
thereto) and fairly presented in all material respects the consolidated
financial position of Company and its consolidated Subsidiaries as of the dates
thereof and the consolidated results of their operations and cash flows for the
periods then ended (subject, in the case of unaudited quarterly statements, to
normal year-end audit adjustments).
(f) ABSENCE OF CERTAIN CHANGES OR EVENTS; NO UNDISCLOSED
MATERIAL LIABILITIES.
(i) Except as disclosed in the SEC Documents
filed and publicly available prior to the date of this Agreement (the "Filed SEC
Documents") or specified in Section 4.1(f) of the Disclosure Schedule, since the
date of the most recent audited financial statements included in the Filed SEC
Documents, Company and its Subsidiaries have conducted their businesses only in
the ordinary course, and there has not been: (A) any change, event or occurrence
which has had or would reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect on Company; (B) any declaration, setting
aside or payment of any dividend or other distribution in respect of shares of
Company's capital stock, or any redemption or other acquisition by Company of
any shares of its capital stock; (C) any increase in the rate or terms of
compensation payable or to become payable by Company or its Subsidiaries to
their directors, officers or key employees, except increases occurring in the
ordinary course of business consistent with past practice; (D) any entry into,
or increase in the rate or terms of, any bonus, insurance, severance, pension or
other employee or retiree benefit plan, payment or arrangement made to, for or
with any such directors, officers or key employees, except increases occurring
in the ordinary course of business consistent with past practices or as required
by applicable law; (E) any entry into any agreement, commitment or transaction
by
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Company or any of its Subsidiaries which is material to Company and its
Subsidiaries taken as a whole, except for agreements, commitments or
transactions entered into in the ordinary course of business consistent with
past practice; (F) any change by Company in accounting methods, principles or
practices, except as required or permitted by generally accepted accounting
principles; (G) except to the extent specifically reserved for in the
financial statements included in the Filed SEC Documents, any write-off or
write-down of, or any determination to write-off or write-down, any asset of
Company or any of its Subsidiaries or any portion thereof which write-off,
write-down or determination exceeds $500,000 individually or $1,000,000 in
the aggregate; (H) any announcement or implementation of any reduction in
force, lay-off, early retirement program, severance program or other program
or effort concerning the termination of employment of employees of Company or
its Subsidiaries; or (I) any announcement of or entry into any agreement,
commitment or transaction by Company or any of its Subsidiaries to do any of
the things described in the preceding clauses (A) through (H) otherwise than
as expressly provided for herein.
(ii) As of the date hereof, except as disclosed in
the Filed SEC Documents or specified in Section 4.1(f) of the Disclosure
Schedule and liabilities incurred in the ordinary course of business consistent
with past practice since the date of the most recent financial statements
included in the Filed SEC Documents, there are no liabilities of Company or its
Subsidiaries of any kind whatsoever, whether accrued, contingent, absolute, due,
to become due, determined, determinable or otherwise, having or which would
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect on Company.
(g) CERTAIN INFORMATION. Subject to Parent's and Merger Sub's
fulfillment of their respective obligations hereunder with respect thereto, the
Schedule 14D-9 and the Proxy Statement will contain (or will be amended in a
timely manner so as to contain) all information which is required to be included
therein in accordance with the Exchange Act and the rules and regulations
thereunder and any other applicable law and will conform in all material
respects with the requirements of the Exchange Act and any other applicable law,
and neither the Schedule 14D-9 nor the Proxy Statement will, at the respective
times they are filed with the SEC or published, sent or given to Company's
stockholders, 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 are made,
not misleading; provided, however, that no representation or warranty is hereby
made by Company with respect to any information supplied or to be supplied by
Parent or Merger Sub in writing for inclusion in, or with respect to Parent or
Merger Sub information derived from Parent's public SEC filings which is
included or incorporated by reference in, the Schedule 14D-9 or the Proxy
Statement. None of the information supplied or to be supplied by Company in
writing for inclusion or incorporation by reference in, or which may be deemed
to be incorporated by reference in, any of the Offer Documents will, at the
respective times the Offer Documents are filed with the SEC or published, sent
or given to Company's stockholders, contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the statements therein, in light of the circumstances under
which they are made, not misleading. If at any time prior to the Effective Time
any event with respect to Company, or with respect to any information supplied
by Company for inclusion in any of the Offer Documents, shall occur
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which is required to be described in an amendment of, or a supplement to, any of
the Offer Documents, Company shall so describe the event to Parent.
(h) REAL PROPERTY; OTHER ASSETS. (i) Section 4.1(h)(i) of the
Disclosure Schedule sets forth all of the real property owned in fee by Company
and its Subsidiaries (the "Owned Real Property").
(ii) Company or one of its Subsidiaries has good and
valid title to each parcel of Owned Real Property and to each other asset
reflected in the latest balance sheet of Company included in the Filed SEC
Documents (other than as disclosed in the Filed SEC Documents, or any such other
asset disposed of or consumed in the ordinary course of business or as specified
in Section 4.1(h)(ii) of the Disclosure Schedule) free and clear of all Liens
except (A) those specified in Section 4.1(h)(ii) of the Disclosure Schedule or
reflected or reserved against in the latest balance sheet of Company included in
the Filed SEC Documents, (B) taxes and general and special assessments not in
default and payable without penalty and interest, and (C) other Liens that
individually or in the aggregate would not have a Material Adverse Effect on
Company (collectively, "Permitted Liens").
(iii) Company has heretofore made available to
Parent true, correct and complete copies of all leases, subleases and other
agreements (the "Real Property Leases") under which Company or any of its
Subsidiaries uses or occupies or has the right to use or occupy, now or in the
future, any real property or facility (the "Leased Real Property"), including
all modifications, amendments and supplements thereto. Except in each case where
the failure would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect on Company: (A) Company or one of its
Subsidiaries has a valid leasehold interest in each parcel of Leased Real
Property free and clear of all Liens except Permitted Liens and each Real
Property Lease is in full force and effect, (B) all rent and other sums and
charges due and payable by Company or its Subsidiaries as tenants thereunder are
current in all material respects, (C) no termination event or condition or
uncured default of a material nature on the part of Company or any such
Subsidiary or, to Company's knowledge, the landlord, exists under any Real
Property Lease, and (D) Company or one of its Subsidiaries is in actual
possession of each leased Real Property and is entitled to quiet enjoyment
thereof in accordance with the terms of the applicable Real Property Lease.
(i) YEAR 2000 COMPLIANCE.
(i) Company presently expects that all
reprogramming, remediation and testing of Information Systems and Equipment (as
defined below) that is required to make it in all material respects Year 2000
Compliant will be completed no later than December 31, 1999. Except as otherwise
disclosed in the Filed SEC Documents, the cost of all such reprogramming,
remediation and testing, together with the reasonably foreseeable consequences
of any reasonably foreseeable failure of such Information Systems and Equipment
to be or timely become Year 2000 Compliant will not have, individually or in the
aggregate, a Material Adverse Effect on Company.
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(ii) (A) As used in respect of Information Systems
and Equipment, "Year 2000 Compliant" means that such Information Systems and
Equipment will not cease to properly function, produce erroneous results or
otherwise experience diminished performance or functionality when presented with
or when calculating, comparing, sequencing or otherwise processing date data
before, during and after the year 2000 and (B) "Information Systems and
Equipment" means all computer hardware, firmware, software and information
processing systems and all equipment containing embedded microchips that is used
by Company or any of its Subsidiaries in the conduct of their respective
business.
(j) INTELLECTUAL PROPERTY.
(i) Section 4.1(j)(i) of the Disclosure Schedule
sets forth a true, correct and complete list (including, to the extent
applicable, registration, application or file numbers) of all patents,
registered trademarks and service marks, trade names, domain names and
registered copyrights owned by Company or any Subsidiary of Company, and all
applications for registration of any of the foregoing, including any additions
thereto or extensions, continuations, renewals or divisions thereof (setting
forth the registration, issue or serial number and a description of the same)
(collectively, together with all trade dress, trade secrets, processes,
formulae, designs, know-how and other intellectual property rights that are so
owned, the "Intellectual Property"). Company has heretofore provided or made
available to Parent true, correct and complete copies of each registration or
application for registration covering any of the Intellectual Property which is
registered with, or in respect of which any application for registration has
been filed with, any Governmental Entity.
(ii) The Intellectual Property and that
intellectual property licensed to Company and its Subsidiaries under the
license agreements listed in Section 4.1(j)(ii) of the Disclosure Schedule
includes all of the material intellectual property rights that are reasonably
necessary to conduct Company's business as it is now conducted. Except as
specified in Section 4.1(j)(ii) of the Disclosure Schedule, (A) Company,
directly or through its Subsidiaries, has good, marketable and exclusive
title to, and the valid and enforceable power and right to use, the
Intellectual Property free and clear of all Liens (other than Permitted Liens
and except where the failure to have such title, power and rights has not had
and would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect on Company) and (B) neither Company nor
any of its Subsidiaries has granted any license to a third party with respect
to the Intellectual Property or any portion thereof or any rights to use,
market or exploit the Intellectual Property or any portion thereof.
(k) NO INFRINGEMENT. Except as specified in Section 4.1(k) of
the Disclosure Schedule, neither the existence nor the sale, license, lease,
transfer, use, reproduction, distribution, modification or other exploitation by
Company or any Subsidiary of Company of any Intellectual Property, as such
Intellectual Property is sold, licensed, leased, transferred, used or otherwise
exploited by such persons, (i) infringes on any patent, trademark, copyright or
other right of any other person or (ii) constitutes a misuse or misappropriation
of any trade secret, know-how, process, proprietary information or other right
of any other person (except in each of clauses (i) and (ii) where any such
infringement, misuse or misappropriation has not had and would not reasonably be
expected to have, individually or in the aggregate, a Material Adverse
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Effect on Company). Except as specified in Section 4.1(k) of the Disclosure
Schedule, as of the date hereof, neither Company nor any of its Subsidiaries has
received any written complaint, assertion, threat or allegation or otherwise has
notice of any lawsuit, claim, demand, proceeding or investigation involving
matters of the type contemplated by the immediately preceding sentence. Except
as specified in Section 4.1(k) of the Disclosure Schedule, there are no
restrictions on the ability of Company, any Subsidiary of Company or any of
their respective successors or assigns to sell, license, lease, transfer, use,
reproduce, distribute, modify or otherwise exploit any Intellectual Property.
(l) MATERIAL CONTRACTS. There have been made available to
Parent and its representatives true, correct and complete copies of all of the
following contracts to which Company or any of its Subsidiaries is a party or by
which any of them is bound (collectively, the "Material Contracts"): (i)
contracts with any current officer or director of Company or any of its
Subsidiaries; (ii) contracts (A) for the sale of any of the assets of Company or
any of its Subsidiaries, other than contracts entered into in the ordinary
course of business or (B) for the grant to any person of any preferential rights
to purchase any of its assets; (iii) contracts which restrict Company or any of
its Subsidiaries from competing in any line of business or with any person in
any geographical area or which restrict any other person from competing with
Company or any of its Subsidiaries in any line of business or in any
geographical area; (iv) indentures, credit agreements, security agreements,
mortgages, guarantees, promissory notes and other contracts relating to the
borrowing of money; and (v) all other agreements, contracts or instruments that
are material to Company and its Subsidiaries taken as a whole. Except as
specified in Section 4.1(l) of the Disclosure Schedule, all of the Material
Contracts are in full force and effect and are the legal, valid and binding
obligation of Company and/or its Subsidiaries, enforceable against them in
accordance with their respective terms, subject to applicable bankruptcy,
insolvency, reorganization, moratorium and similar laws affecting creditors'
rights and remedies generally and subject, as to enforceability, to general
principles of equity (regardless of whether enforcement is sought in a
proceeding at law or in equity), except where the failure of such Material
Contracts to be in full force and effect or to be legal, valid, binding or
enforceable against Company and/or its Subsidiaries has not had and would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect on Company. Except as specified in Section 4.1(l) of the
Disclosure Schedule, neither Company nor any of its Subsidiaries is in breach or
default in any material respect under any Material Contract nor, to the
knowledge of Company, is any other party to any Material Contract in breach or
default thereunder in any material respect, except where such breaches or
defaults have not had and would not reasonably be expected to have a Material
Adverse Effect on Company.
(m) LITIGATION, ETC. As of the date hereof, except as
disclosed in the Filed SEC Documents or specified in Section 4.1(m) of the
Disclosure Schedule, (i) there is no suit, claim, action, proceeding (at law or
in equity) or investigation pending or, to the knowledge of Company, threatened
against Company or any of its Subsidiaries before any court or other
Governmental Entity, and (ii) neither Company nor any of its Subsidiaries is
subject to any outstanding order, writ, judgement, injunction, decree or
arbitration order or award that, in any such case described in clauses (i) and
(ii), has had or would reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect on Company. As of the date hereof, there
are no suits, claims, actions, proceedings or investigations pending or, to the
knowledge of
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Company, threatened, seeking to prevent, hinder, modify or challenge the
transactions contemplated by this Agreement.
(n) COMPLIANCE WITH APPLICABLE LAWS. All federal, state, local
and foreign governmental approvals, authorizations, certificates, filings,
franchises, licenses, notices, permits and rights ("Permits") necessary for each
of Company and its Subsidiaries to own, lease or operate its properties and
assets and to carry on its business as now conducted have been obtained or made,
and there has occurred no default under any such Permit, except for the lack of
Permits and for defaults under Permits which lack or default would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect on Company. Except as disclosed in the Filed SEC Documents or
specified in Section 4.1(n) of the Disclosure Schedule, Company and its
Subsidiaries are in compliance with all applicable statutes, laws, ordinances,
rules, orders and regulations of any Governmental Entity, except for
non-compliance which would not reasonably be expected to have, individually or
in the aggregate, a Material Adverse Effect on Company.
(o) ENVIRONMENTAL LAWS. Except as disclosed in the Filed SEC
Documents or as specified in Section 4.1(o) of the Disclosure Schedule or as
would not reasonably be expected to have, individually or in the aggregate, a
Material Adverse Effect on Company: (A) neither Company nor any of its
Subsidiaries has violated or is in violation of any Environmental Law (as
defined in Section 9.3); (B) none of the Owned Real Property or Leased Real
Property (including without limitation soils and surface and ground waters) are
contaminated with any Hazardous Substance (as defined in Section 9.3) in
quantities which require investigation or remediation under Environmental Laws;
(C) neither Company nor any of its Subsidiaries is liable for any off-site
contamination; (D) neither Company nor any of its Subsidiaries has any liability
or remediation obligation under any Environmental Law; (E) no assets of Company
or any of its Subsidiaries are subject to pending or, to Company's knowledge,
threatened Liens under any Environmental Law; (F) Company and its Subsidiaries
have all Permits required under any Environmental Law ("Environmental Permits");
and (G) Company and its Subsidiaries are in compliance with their respective
Environmental Permits.
(p) TAXES. Except as specified in Section 4.1(p) of the
Disclosure Schedule:
(i) Except where the failure to do so would not
reasonably be expected to have, individually or in the aggregate, a Material
Adverse Effect on Company, each of Company and each Subsidiary of Company (and
any affiliated or unitary group of which any such person was a member) has (A)
timely filed all federal, state, local and foreign returns, declarations,
reports, estimates, information returns and statements ("Returns") required to
be filed by or for it in respect of any Taxes (as hereinafter defined) and has
caused such Returns as so filed to be true, correct and complete, (B)
established reserves that are reflected in Company's most recent financial
statements included in the Filed SEC Documents and that as so reflected are
adequate for the payment of all Taxes not yet due and payable with respect to
the results of operations of Company and its Subsidiaries through the date
hereof, and (C) timely withheld and paid over to the proper taxing authorities
all Taxes and other amounts required to be so withheld and paid over. Each of
Company and each Subsidiary of Company (and any affiliated or unitary group of
which any such person was a member) has timely paid all Taxes that are shown as
being
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due on the Returns referred to in the immediately preceding sentence. There have
been made available to Parent and its representatives true, correct and complete
copies of all Returns filed by or for Company and each Subsidiary of Company
(and any affiliated or unitary group of which any such person was a member) in
respect of any Taxes.
(ii) As of the date hereof, (A) there has been no
taxable period since 1992 for which a Return of Company or any of its
Subsidiaries has been or is being examined by the Internal Revenue Service (the
"IRS") or any other federal, state, local or foreign taxing authority, and (B)
except for alleged deficiencies which have been finally and irrevocably
resolved, Company has not received formal or informal notification that any
deficiency for any Taxes, the amount of which could reasonably be expected to
have, individually or in the aggregate, a Material Adverse Effect on Company,
has been or will be proposed, asserted or assessed against Company or any of its
Subsidiaries by any federal, state, local or foreign taxing authority or court
with respect to any period.
(iii) Neither Company nor any of its Subsidiaries is
a party to, is bound by or has any obligation under any tax sharing agreement or
similar agreement or arrangement with any person other than Company or any of
its Subsidiaries.
For purposes of this Agreement, "Taxes" shall mean all
federal, state, local, foreign income, property, sales, excise, employment,
payroll, franchise, withholding and other taxes, tariffs, charges, fees, levies,
imposts, duties, licenses or other assessments of every kind and description,
together with any interest and any penalties, additions to tax or additional
amounts imposed by any federal, state, local or foreign taxing authority.
(q) BENEFIT PLANS. Section 4.1(q) of the Disclosure Schedule
sets forth a true, correct and complete list of all the employee benefit plans
(as that phrase is defined in Section 3(3) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA")) maintained or contributed to (or to
which Company has any obligation to contribute) for the benefit of any current
or former employee, officer or director of Company or any of its Subsidiaries
("Company ERISA Plans") and any other benefit or compensation plan, program or
arrangement maintained or contributed to (or to which Company has any obligation
to contribute) for the benefit of any current or former employee, officer or
director of Company or any of its Subsidiaries (Company ERISA Plans and such
other plans being referred to as "Company Plans"). Company has no liability with
respect to any plan, program or arrangement of the type described in the
preceding sentence other than the Company Plans.
Company has furnished or made available to Parent and its
representatives a true, correct and complete copy of every document pursuant to
which each Company Plan is established or operated (including any summary plan
descriptions), a written description of any Company Plan for which there is no
written document, all determination letters from the IRS with respect to any
Company Plan, all trust agreements, insurance contracts, and other documents
relating to the funding or payment of benefits under any Company Plan and the
six most recent annual reports, financial statements and actuarial valuations
with respect to each Company Plan, where applicable. Except as specified in
Section 4.1(q) of the Disclosure Schedule:
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(i) none of the Company ERISA Plans is a
"multiemployer plan" within the meaning of Section 3(37) of ERISA or a "multiple
employer plan" within the meaning of Section 210(a) of ERISA or Section 413(c)
of the Code;
(ii) no Company ERISA Plan has incurred an
accumulated funding deficiency within the meaning of Section 302 of ERISA or
Section 412 of the Code, nor has any waiver of the minimum funding standards of
Section 302 of ERISA and Section 412 of the Code been requested of or granted by
the Internal Revenue Service with respect to any Employee Plan, nor has any lien
in favor of any Employee Plan arisen under Section 412 of the Code or Section
302(f) of ERISA;
(iii) the Company has not been required to provide
security to any defined benefit plan pursuant to Section 401(a)(29) of the Code;
(iv) (A) the Pension Benefit Guaranty Corporation
("PBGC") has not instituted proceedings to terminate any Company ERISA Plan that
is a "defined benefit plan" within the meaning of Section 3(35) of ERISA of
Company or its Subsidiaries or members of their "controlled group" or to appoint
a trustee or administrator of such defined benefit plan, (B) no circumstances
exist that constitute grounds under Section 404 of ERISA entitling the PBGC to
institute any such proceedings, (C) no liability to the PBGC or under Title IV
of ERISA has been incurred or is expected with respect to any such defined
benefit plan that could result in liability to any member of the "controlled
group" or Parent other than for premiums pursuant to Section 4007 which are not
yet due and payable, and (D) no such defined benefit plan has been terminated by
Company, its Subsidiaries or members of their "controlled group";
(v) there has been no "reportable event" within the
meaning of Section 4043 and the regulations and interpretations thereunder which
has not been fully and accurately reported in a timely fashion, as required, or
which, whether or not reported, would constitute grounds for the PBGC to
institute termination proceedings with respect to any Company ERISA Plan;
(vi) as of the last valuation date for which a
report has been completed, the fair market value of the assets of each Company
ERISA Plan that is a defined benefit plan exceeds the accumulated benefit
obligation thereunder (all determined in accordance with Financial Accounting
Standards Board Statement of Financial Accounting Standards No. 87).
(vii) none of the Company Plans promises or provides
retiree health benefits or retiree life insurance benefits to any person except
as required by Section 4980B of the Code;
(viii) none of the Company Plans provides for payment
of a benefit, the increase of a benefit amount, the payment of a contingent
benefit or the acceleration of the payment or vesting of a benefit by reason of
the execution of this Agreement or the consummation of the transactions
contemplated by this Agreement;
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(ix) neither Company nor any of its Subsidiaries has
an obligation to adopt, or is considering the adoption of, any new benefit or
compensation plan, program or arrangement or, except as required by law, the
amendment of an existing Company Plan;
(x) each Company ERISA Plan intended to be
qualified under Section 401(a) of the Code has received a favorable
determination letter from the IRS that it is so qualified and each trust created
thereunder has heretofore been determined by the IRS to be exempt from tax under
the provisions of Section 501(a) of the Code, and nothing has occurred since the
date of any such determination that could reasonably be expected to affect the
qualified status of such Company ERISA Plan or the tax-exempt status of any such
trust;
(xi) each Company Plan has been operated in
accordance with its terms and the requirements of all applicable law, and no
prohibited transaction (for which an exemption does not apply) described in
Section 406 of ERISA or Section 4975 of the Code has occurred with respect to
any Company ERISA Plan;
(xii) neither Company nor any of its Subsidiaries or
members of their "controlled group" has incurred any direct or indirect
liability under ERISA or the Code in connection with the termination of,
withdrawal from or failure to fund, any Company ERISA Plan or other retirement
plan or arrangement, and no fact or event exists that could reasonably be
expected to give rise to any such liability;
(xiii) Company is not aware of any claims relating to
the Company Plans, other than routine claims for benefits;
(xiv) none of the Company Plans provides for benefits
or other participation therein, and Company has received no written claims or
demands for participation in or benefits under any Company Plan, by any
individual who is not a current or former employee of Company or a dependent or
other beneficiary of any such current or former employee;
(xv) with respect to each group health plan
benefitting any current or former employee of Company, its Subsidiaries or
members of their "controlled group," that is subject to Section 4980B of the
Code, or was subject to Section 162(k) of the Code, Company, its Subsidiaries
and members of their "controlled group" have complied with (x) the continuation
coverage requirements of Section 4980B of the Code and Section 162(k) of the
Code, as applicable, and Part 6 of Subtitle B of Title I of ERISA and (y) the
Health Insurance Portability and Accountability Act of 1996;
(xvi) with respect to each group health plan that is
subject to Section 1862(b)(1) of the Social Security Act, Company has complied
with the secondary payer requirements of Section 1862(b)(1) of such Act;
(xvii) no Company Plan is or at any time was funded
through a "welfare benefit fund" as defined in Section 419(e) of the Code, and
no benefits under any Company Plan are or at any time have been funded through a
voluntary employees' beneficiary association
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(within the meaning of Section 501(c)(9) of the Code) or a supplemental
unemployment benefit plan (within the meaning of Section 501(c)(17) of the
Code);
(xviii) with respect to any insurance policy providing
funding for benefits under any Company Plan, (x) there is no liability of
Company in the nature of a retroactive rate adjustment, loss sharing arrangement
or other actual or contingent liability, nor would there be any such liability
if such insurance policy was terminated on the date hereof, and (y) no insurance
company issuing any such policy is in receivership, conservatorship, liquidation
or similar proceeding and, to the knowledge of Company, no such proceedings with
respect to any insurer are imminent;
provided, however, that the failure of the representations set forth in clauses
(iv), (x), (xi), (xii) and (xiii) to be true and correct shall not be deemed to
be a breach of any such representation unless such failures would reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect on
Company;
(r) ABSENCE OF CHANGES IN BENEFIT PLANS. Except as disclosed
in the Filed SEC Documents or in Section 4.1(r) of the Disclosure Schedule,
since the date of the most recent audited financial statements included in the
Filed SEC Documents, neither Company nor any of its Subsidiaries has adopted or
agreed to adopt any collective bargaining agreement or any Company Plan.
(s) LABOR MATTERS.
(i) Except as specified in Section 4.1(s)(i) of
the Disclosure Schedule, neither Company nor any of its Subsidiaries is a party
to any employment, labor or collective bargaining agreement, and there are no
employment, labor or collective bargaining agreements which pertain to employees
of Company or any of its Subsidiaries. Company has heretofore made available to
Parent true, complete and correct copies of the agreements set forth in Section
4.1(s)(i) of the Disclosure Schedule, together with all amendments,
modifications, supplements or side letters affecting the duties, rights and
obligations of any party thereunder.
(ii) Except as specified in Section 4.1(s)(ii) of
the Disclosure Schedule, as of the date hereof, there are no (A) unfair labor
practice charges, grievances or complaints pending or threatened in writing
by or on behalf of any employee or group of employees of Company or any of
its Subsidiaries, or (B) complaints, charges or claims against Company or any
of its Subsidiaries pending, or threatened in writing to be brought or filed,
with any Governmental Entity or arbitrator based on, arising out of, in
connection with, or otherwise relating to the employment or termination of
employment of any individual by Company or any of its Subsidiaries.
(t) BROKERS. No broker, investment banker, financial advisor
or other person, other than WDR and Kohlberg & Company, L.L.C., the fees and
expenses of which will be paid by Company, is entitled to any broker's,
finder's, financial advisor's or other similar fee or commission in connection
with the transactions contemplated hereby based upon arrangements made by or on
behalf of Company.
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(u) WRITTEN OPINION OF FINANCIAL ADVISOR. Company has received
the opinion of WDR on January 18, 1999 (a true, correct and complete copy of
which will be delivered to Parent by Company), to the effect that, based upon
and subject to the matters set forth therein and as of the date thereof, the
Offer Consideration and the Merger Consideration to be received by the holders
of Shares in the Offer and the Merger, respectively, is fair, from a financial
point of view, to such holders and such opinion has not been withdrawn or
modified.
(v) VOTING REQUIREMENTS. In the event that Section 253 of the
DGCL is inapplicable and unavailable to effectuate the Merger, the affirmative
vote of the holders of a majority of the outstanding Shares entitled to vote at
the Stockholders Meeting (as defined in Section 6.1(a)) with respect to the
adoption of this Agreement is the only vote of the holders of any class or
series of Company's capital stock or other securities required in connection
with the consummation by Company of the Merger and the other transactions
contemplated hereby to be consummated by Company. The restrictions contained in
Section 203 of the DGCL are not applicable to the transactions contemplated
hereby or the transactions contemplated by the Stockholder Agreement.
Section 4.2 REPRESENTATIONS AND WARRANTIES OF PARENT AND MERGER SUB.
Parent and Merger Sub jointly and severally represent and warrant to Company as
follows:
(a) ORGANIZATION, STANDING AND CORPORATE POWER. Each of Parent
and Merger Sub is a corporation duly organized, validly existing and in good
standing under the laws of the jurisdiction in which it is incorporated and has
the requisite corporate power and authority to carry on its business as now
being conducted. Each of Parent and Merger Sub has delivered to Company true,
complete and correct copies of its certificate of incorporation and bylaws, in
each case, as amended to the date of this Agreement.
(b) AUTHORITY; NONCONTRAVENTION. Parent and Merger Sub have
the requisite corporate power and authority to enter into this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement by Parent and Merger Sub and the consummation by Parent and
Merger Sub of the transactions contemplated hereby have been duly authorized by
the Executive Committee of the Board of Directors of Parent and the Board of
Directors of Merger Sub and have been duly approved by Parent as sole
stockholder of Merger Sub, and no other corporate proceedings on the part of
Parent or Merger Sub are necessary to authorize this Agreement or to consummate
the transactions contemplated hereby. This Agreement has been duly executed and
delivered by each of Parent and Merger Sub and, assuming this Agreement
constitutes a valid and binding obligation of Company, constitutes a valid and
binding obligation of each of Parent and Merger Sub, enforceable against each
such party in accordance with its terms, subject to applicable bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium and similar laws
affecting creditors' rights and remedies generally and to general principles of
equity. The execution and delivery of this Agreement do not, and the
consummation of the transactions contemplated hereby and compliance with the
provisions of this Agreement will not (i) conflict with any of the provisions of
the certificate of incorporation or bylaws of Parent or Merger Sub, in each case
as amended to the date of this Agreement, (ii) subject to the governmental
filings and other matters referred to in Section 4.2(c), conflict with, result
in a breach of or default (with or without notice or lapse of time, or
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both) under, or give rise to a material obligation, a right of termination,
cancellation or acceleration of any obligation or loss of a material benefit
under, or require the consent of any person under, any indenture, or other
agreement, permit, concession, franchise, license or similar instrument or
undertaking to which Parent or Merger Sub is a party or by which Parent or
Merger Sub or any of their respective assets is bound or affected, or (iii)
subject to the governmental filings and other matters referred to in Section
4.2(c), contravene any domestic or foreign law, rule or regulation, or any
order, writ, judgment, injunction, decree, determination or award currently in
effect, which, in the case of clauses (ii) and (iii) above, could reasonably be
expected to have, individually or in the aggregate, a Material Adverse Effect on
Parent.
(c) CONSENTS AND APPROVALS. No consent, approval or
authorization of, or declaration or filing with, or notice to, any Governmental
Entity which has not been received or made is required by or with respect to
Parent or Merger Sub in connection with the execution and delivery of this
Agreement by Parent or Merger Sub or the consummation by Parent or Merger Sub,
as the case may be, of any of the transactions contemplated hereby, except for
(i) the filing of premerger notification and report forms under the HSR Act,
(ii) the filing with the SEC of (A) the Schedule 14D-1, the information
statement required under Rule 14f-1 of the Exchange Act and (B) such reports
under the Exchange Act as may be required in connection with this Agreement or
the Stockholder Agreement and the transactions contemplated hereby and thereby,
(iii) the filing of the certificate of merger or, if permitted, a certificate of
ownership and merger with the Delaware State Secretary and appropriate documents
with the relevant authorities of other states in which Company is qualified to
do business, (iv) applicable environmental statutes, and (v) any other consents,
approvals, authorizations, filings or notices the failure to make or obtain
which would not reasonably be expected to have, individually or in the
aggregate, a Material Adverse Effect on Parent.
(d) CERTAIN INFORMATION. Subject to Company's fulfillment of
its obligations hereunder with respect thereto, the Offer Documents will contain
(or will be amended in a timely manner so as to contain) all information which
is required to be included therein in accordance with the Exchange Act and the
rules and regulations thereunder and any other applicable law and will conform
in all material respects with the requirements of the Exchange Act and any other
applicable law, and the Offer Documents will not, at the respective times they
are filed with the SEC or published, sent or given to Company's stockholders,
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 are made, not
misleading; provided, however, that no representation or warranty is hereby made
by Parent or Merger Sub with respect to any information supplied or to be
supplied by Company in writing for inclusion in, or with respect to Company
information derived from Company's public SEC filings which is included or
incorporated by reference in the Offer Documents. None of the information
supplied or to be supplied by Parent or Merger Sub in writing for inclusion or
incorporation by reference in, or which may be deemed to be incorporated by
reference in, the Schedule 14D-9, the information statement required under Rule
14f-1 of the Exchange Act or the Proxy Statement will, at the respective times
the Schedule 14D-9, the information statement required under Rule 14f-1 of the
Exchange Act and the Proxy Statement are filed with the SEC or published, sent
or given to Company's stockholders, contain any untrue statement of a material
fact or omit to state any material fact required to be stated therein or
necessary to make the
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statements therein, in light of the circumstances under which they are made, not
misleading. If at any time prior to the Effective Time any event with respect to
Parent or Merger Sub, or with respect to any information supplied by Parent or
Merger Sub for inclusion in the Schedule 14D-9, the information statement
required under Rule 14f-1 of the Exchange Act or the Proxy Statement, shall
occur which is required to be described in an amendment of, or a supplement to,
such document, Parent or Merger Sub shall so describe the event to Company.
(e) FINANCING. Parent and Merger Sub collectively have cash on
hand or credit facilities with financially responsible third parties, or a
combination thereof, in an aggregate amount sufficient to enable Parent and
Merger Sub to timely perform their obligations hereunder, including to (i) pay
in full (A) the aggregate Offer Consideration, (B) the aggregate Merger
Consideration and the aggregate Option Consideration, and (C) all fees and
expenses payable by Parent and Merger Sub in connection with this Agreement and
the transactions contemplated thereby and (ii) satisfy and discharge such of
Company's existing indebtedness as, pursuant to its terms, will become due and
payable prior to its stated maturity as a result of the consummation of the
transactions contemplated hereby.
(f) BROKERS. No broker, investment banker, financial advisor
or other person, other than Goldman, Sachs & Co., the fees and expenses of which
will be paid by Parent, is entitled to any broker's, finder's, financial
advisor's or other similar fee or commission in connection with the transactions
contemplated hereby based upon arrangement made by or on behalf of Parent or
Merger Sub.
(g) OPERATIONS OF MERGER SUB. Merger Sub (or any other
wholly-owned Subsidiary of Parent which may be used to effect the Offer and the
Merger contemplated by the Agreement) was formed solely for the purpose of
engaging in the transactions contemplated by this Agreement, has engaged in no
other business activities and has conducted its operations only as contemplated
hereby.
ARTICLE V
CONDUCT OF BUSINESS OF COMPANY
Section 5.1 CONDUCT OF BUSINESS OF COMPANY. Except as expressly
provided for herein or in the Fiber Cement Agreement, during the period from the
date of this Agreement to the Effective Time, Company shall, and shall cause
each of its Subsidiaries to, act and carry on its business only in the ordinary
course of business consistent with past practice and, to the extent consistent
therewith, use reasonable efforts to preserve intact its current business
organizations, keep available the services of its current key officers and
employees and preserve the goodwill of those engaged in material business
relationships with Company. To that end, without limiting the generality of the
foregoing, except as expressly provided for in this Agreement or the Fiber
Cement Agreement, Company shall not, and shall not permit any of its
Subsidiaries to, without the prior consent of Parent:
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(i) (A) declare, set aside or pay any dividends
on, or make any other distributions (whether in cash, securities or other
property) in respect of, any of its outstanding capital stock (other than, with
respect to a Subsidiary of Company, to its corporate parent), (B) split, combine
or reclassify any of its outstanding capital stock or issue or authorize the
issuance of any other securities in respect of, in lieu of or in substitution
for shares of its outstanding capital stock, or (C) purchase, redeem or
otherwise acquire any shares of outstanding capital stock or any rights,
warrants or options to acquire any such shares, except, in the case of this
clause (C), for the acquisition of Shares from holders of Options in full or
partial payment of the exercise price payable by such holder upon exercise of
Options;
(ii) issue, sell, grant, pledge or otherwise
encumber any shares of its capital stock, any other voting securities or any
securities convertible into or exchangeable for, or any rights, warrants or
options to acquire, any such shares, voting securities or convertible or
exchangeable securities, other than upon the exercise of Options outstanding on
the date of this Agreement;
(iii) amend its certificate of incorporation, bylaws
or other comparable charter or organizational documents, except for any
amendment required in connection with the performance by Company of its
obligations under this Agreement, including but not limited to its obligations
under Section 1.4;
(iv) directly or indirectly acquire, make any
investment in, or make any capital contributions to, any person other than in
the ordinary course of business consistent with past practice;
(v) directly or indirectly sell, pledge or
otherwise dispose of or encumber any of its properties or assets that are
material to its business, except for sales, pledges or other dispositions or
encumbrances in the ordinary course of business consistent with past practice;
(vi) (A) incur any indebtedness for borrowed money
or guarantee any such indebtedness of another person, other than indebtedness
owing to or guarantees of indebtedness owing to Company or any direct or
indirect wholly owned Subsidiary of Company or (B) make any loans or advances to
any other person, other than to Company or to any direct or indirect wholly
owned Subsidiary of Company and other than routine advances to employees
consistent with past practice, except, in the case of clause (A), for borrowings
under existing credit facilities described in the Filed SEC Documents in the
ordinary course of business consistent with past practice;
(vii) enter into any compromise or settlement of, or
take any material action with respect to, any litigation, action, suit, claim,
proceeding or investigation other than the prosecution, defense and settlement
of routine litigation, actions, suits, claims, proceedings or investigations in
the ordinary course of business;
(viii) grant or agree to grant to any officer,
employee or consultant any increase in wages or bonus, severance, profit
sharing, retirement, deferred compensation,
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insurance or other compensation or benefits, or establish any new compensation
or benefit plans or arrangements, or amend or agree to amend any existing
Company Plans, except as may be required under existing agreements or by law or
pursuant to the normal severance policies or practices of Company or its
Subsidiaries as in effect on the date of this Agreement, or increases in salary
or wages payable or to become payable in the ordinary course of business
consistent with past practice;
(ix) accelerate the payment, right to payment or
vesting of any bonus, severance, profit sharing, retirement, deferred
compensation, stock option, insurance or other compensation or benefits;
(x) enter into or amend any employment, consulting,
severance or similar agreement with any individual other than in the ordinary
course of business consistent with past practice, except with respect to new
hires of non-officer employees in the ordinary course of business consistent
with past practice;
(xi) adopt or enter into a plan of complete or
partial liquidation, dissolution, merger, consolidation, restructuring,
recapitalization or other material reorganization or any agreement relating to
an Acquisition Proposal (as defined in Section 6.5(d));
(xii) make any tax election or settle or compromise
any income tax liability of Company or of any of its Subsidiaries involving on
an individual basis more than $100,000;
(xiii) make any change in any method of accounting or
accounting practice or policy, except as required by any changes in generally
accepted accounting principles;
(xiv) enter into any agreement, understanding or
commitment that restrains, limits or impedes Company's ability to compete with
or conduct any business or line of business;
(xv) plan, announce, implement or effect any
reduction in force, lay-off, early retirement program, severance program or
other program or effort concerning the termination of employment of employees of
Company or its Subsidiaries; or
(xvi) authorize any of, or commit or agree to take
any of, the foregoing actions in respect of which it is restricted by the
provisions of this Section 5.1.
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ARTICLE VI
ADDITIONAL COVENANTS
Section 6.1 COMPANY STOCKHOLDERS MEETING; PREPARATION OF THE PROXY
STATEMENT; SHORT-FORM MERGER.
(a) As soon as practicable following the acceptance for
payment of and payment for Shares by Merger Sub in the Offer, if required by law
to consummate the Merger, Company shall take all action necessary, in accordance
with the DGCL, the Exchange Act and other applicable law and its certificate of
incorporation and bylaws to convene and hold a special meeting of the
stockholders of Company (the "Stockholders Meeting") for the purpose of
considering and voting upon this Agreement and to solicit proxies pursuant to
the Proxy Statement in connection therewith. Subject to the provisions of
Section 6.5(b), the Board of Directors of Company shall recommend that the
holders of Shares vote in favor of the adoption of this Agreement at the
Stockholders Meeting and shall cause such recommendation to be included in the
Proxy Statement. At the Stockholders Meeting, Parent and Merger Sub shall cause
all of the Shares owned by them to be voted in favor of the adoption of this
Agreement.
(b) As soon as practicable following the acceptance for
payment of and payment for Shares by Merger Sub in the Offer, if required by
applicable law in order to consummate the Merger, Company, in consultation with
Parent, shall prepare and file with the SEC a proxy statement or information
statement (together with any supplement or amendment thereto, the "Proxy
Statement") relating to the Stockholders Meeting in accordance with the Exchange
Act and the rules and regulations thereunder. Parent, Merger Sub and Company
will cooperate with each other in the preparation of the Proxy Statement.
Without limiting the generality or effect of the foregoing, Company shall use
its reasonable efforts to respond to all SEC comments with respect to the Proxy
Statement and, subject to compliance with SEC rules and regulations, to cause
the Proxy Statement to be mailed to Company's stockholders at the earliest
practicable date. Each of Parent and Merger Sub shall promptly supply to Company
in writing, for inclusion in the Proxy Statement, all information concerning
Parent and Merger Sub required under the Exchange Act and the rules and
regulations thereunder to be included in the Proxy Statement.
(c) Notwithstanding the foregoing clauses (a) and (b), in the
event that Merger Sub or any other wholly-owned Subsidiary of Parent shall
acquire at least 90% of the outstanding shares of Company Common Stock in the
Offer, the parties hereto shall, at the request of Merger Sub, take all
necessary actions to cause the Merger to become effective, as soon as
practicable after the expiration of the Offer, without a meeting of stockholders
of Company, in accordance with Section 253 of the DGCL.
(d) Parent shall: (i) cause Merger Sub promptly to submit this
Agreement for adoption by its sole stockholder; (ii) cause the outstanding
shares of capital stock of Merger Sub to be voted in favor of the adoption of
this Agreement; and (iii) cause to be taken all additional actions necessary for
Merger Sub to adopt this Agreement.
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Section 6.2 ACCESS TO INFORMATION; CONFIDENTIALITY. Company shall, and
shall cause each of its Subsidiaries to, afford to Parent and its officers,
employees, counsel, financial advisors and other representatives reasonable
access (subject, however, to existing confidentiality and similar non-disclosure
obligations) during normal business hours and upon reasonable notice during the
period prior to the Effective Time to all of Company's and its Subsidiaries'
properties, books, contracts, commitments, Returns, personnel and records and,
during such period, Company shall, and shall cause each of its Subsidiaries to,
furnish as promptly as practicable to Parent such information concerning
Company's and its Subsidiaries' businesses, properties, financial condition,
operations and personnel as Parent may from time to time reasonably request. Any
such investigation by Parent shall not affect the representations or warranties
of Company contained in this Agreement. Except as required by law, Parent and
Company will hold, and will cause its directors, officers, employees,
accountants, counsel, financial advisors and other representatives and
affiliates to hold, any non-public information obtained from the other in
confidence to the extent required by, and in accordance with the provisions of,
the letter agreement, dated October 19, 1998, between Parent and Company with
respect to confidentiality and other matters.
Section 6.3 REASONABLE BEST EFFORTS. On the terms and subject to the
conditions set forth in this Agreement, each of the parties shall use its
reasonable best efforts to take, or cause to be taken, all actions, and do, or
cause to be done, and assist and cooperate with the other parties in doing, all
things necessary, proper or advisable to consummate and make effective, in the
most expeditious manner practicable, the Offer, the Merger and the other
transactions contemplated hereby, including the satisfaction of the respective
conditions set forth in Article VII.
Section 6.4 PUBLIC ANNOUNCEMENTS. Parent and Merger Sub, on the one
hand, and Company, on the other hand, shall consult with each other before
issuing, and provide each other the opportunity to review and comment upon, any
press release, SEC filing (including without limitation the Offer Documents, the
Schedule 14D-9 and the Proxy Statement) or other public statements with respect
to the transactions contemplated hereby, including the Offer and Merger, and
shall not issue any such press release or make any such public statement prior
to such consultation, except as may be required by applicable law, by court
process or by obligations pursuant to any listing agreement with any national
securities exchange.
Section 6.5 NO SOLICITATION; ACQUISITION PROPOSALS.
(a) During the period from and including the date of this
Agreement to and including the Effective Time, Company shall not, and shall not
authorize or permit any of its Subsidiaries, or any of its or their affiliates,
officers, directors, employees, agents or representatives (including without
limitation any investment banker, financial advisor, attorney or accountant
retained by Company or any of its Subsidiaries), to, directly or indirectly,
initiate, solicit or encourage (including by way of furnishing information or
assistance), or take any other action to facilitate, any Acquisition Proposal
(as defined in Section 6.5(d)), or enter into or maintain or continue
discussions or negotiations with any person in furtherance of, or approve, agree
to, endorse or recommend, any Acquisition Proposal; provided, however, that
nothing in this Agreement shall prohibit the Board of Directors of Company,
prior to the time at which this
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Agreement shall have been adopted by Company's stockholders, from furnishing
information to, or entering into, maintaining or continuing discussions or
negotiations with, any person that makes a bona fide written Acquisition
Proposal after the date hereof under circumstances not involving any breach of
the provisions of this Section 6.5(a) if, and to the extent that, (i) the Board
of Directors of Company, after consultation with and based upon the advice of
independent legal counsel, determines in good faith that the failure to take
such action would constitute a breach by the Board of Directors of Company of
its fiduciary duties to Company's stockholders under applicable law and (ii)
prior to furnishing any non-public information to such person, Company receives
from such person an executed confidentiality agreement with provisions no less
favorable to Company than the letter agreement relating to the furnishing of
confidential information of Company to Parent referred to in the last sentence
of Section 6.2. Company shall promptly (and, in any event within 24 hours)
notify Parent after receipt of any Acquisition Proposal or any request for
information relating to Company or any of its Subsidiaries or for access to the
properties, books or records of Company or any of its Subsidiaries by any person
who has informed Company that such person is considering making, or has made, an
Acquisition Proposal (which notice shall identify the person making, or
considering making, such Acquisition Proposal and shall set forth the material
terms of any Acquisition Proposal received), and Company shall keep Parent
informed in reasonable detail of the terms, status and other pertinent details
of any such Acquisition Proposal.
(b) During the period from and including the date of this
Agreement to and including the Effective Time, neither the Board of Directors of
Company nor any committee thereof shall withdraw or modify, or propose publicly
to withdraw or modify, in a manner adverse to Parent or Merger Sub, the approval
of this Agreement or the transactions contemplated hereby or the recommendations
referred to in Section 1.3 or the penultimate sentence of Section 6.1(a);
provided, however, that nothing contained in this Agreement will prohibit the
Board of Directors of Company from withdrawing or modifying the recommendations
referred to in Section 1.3 or the penultimate sentence of Section 6.1(a)
following the receipt by Company after the date hereof, under circumstances not
involving any breach of the provisions of Section 6.5(a), of an Acquisition
Proposal if, and to the extent that, the Board of Directors of Company, after
consultation with and based upon the advice of independent legal counsel,
determines in good faith that the failure to take such action would constitute a
breach by the Board of Directors of Company of its fiduciary duties to Company's
stockholders under applicable law; and provided further that nothing contained
in this Agreement will prohibit the Board of Directors of Company from, to the
extent applicable, complying with Rule 14e-2 promulgated under the Exchange Act
with regard to an Acquisition Proposal.
(c) Subject to Company's right to terminate this Agreement
pursuant to Section 8.1(a)(vi), nothing in this Section 6.5, and no action taken
by the Board of Directors of Company pursuant to this Section 6.5, will permit
Company to enter into any agreement providing for any transaction contemplated
by an Acquisition Proposal for as long as this Agreement remains in effect.
(d) For purposes of this Agreement, "Acquisition Proposal"
means an inquiry, offer, proposal or other indication of interest regarding any
of the following (other than the transactions provided for in this Agreement,
the Stockholder Agreement or the Fiber Cement
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Agreement involving Company: (i) any merger, consolidation, share exchange,
recapitalization, business combination or other similar transaction; (ii) any
sale, lease, exchange, mortgage, pledge, transfer or other disposition of all or
substantially all the assets of Company and its Subsidiaries, taken as a whole,
in a single transaction or series of related transactions; (iii) any tender
offer or exchange offer for or other acquisition of 20% percent or more of the
outstanding shares of capital stock of Company or the filing of a registration
statement under the Securities Act in connection therewith; or (iv) any public
announcement of a proposal, plan or intention to do any of the foregoing or any
agreement to engage in any of the foregoing.
Section 6.6 CONSENTS, APPROVALS AND FILINGS. Upon the terms and subject
to the conditions hereof, each of the parties hereto shall (a) make promptly its
respective filings, and thereafter make any other required submissions, under
the HSR Act and the Exchange Act, with respect to the Offer, the Merger and the
other transactions contemplated hereby and (b) use its reasonable best efforts
to take, or cause to be taken, all appropriate action, and to do, or cause to be
done, all things necessary, proper or advisable under applicable laws and
regulations to consummate and make effective the Offer, the Merger and the other
transactions contemplated hereby, including without limitation using its
reasonable best efforts to obtain all licenses, permits, consents, approvals,
authorizations, qualifications and orders of Governmental Entities and parties
to contracts with Company and its Subsidiaries as are necessary for the
consummation of the Offer, the Merger and the other transactions contemplated
hereby and to fulfill the conditions to the Offer and the Merger; provided,
however, that in no event shall Parent or any of its Subsidiaries be required to
agree or commit to divest, hold separate, offer for sale, abandon, limit its
operation of or take similar action with respect to any assets (tangible or
intangible) or any business interest of it or any of its Subsidiaries (including
without limitation the Surviving Corporation after consummation of the Offer or
the Merger) in connection with or as a condition to receiving the consent or
approval of any Governmental Entity (including without limitation under the HSR
Act). 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 action.
Section 6.7 EMPLOYEE BENEFIT MATTERS.
(a) From and after the Effective Time, Parent shall, and shall
cause its Subsidiaries (including the Surviving Corporation) to, honor and
provide for payment of all accrued obligations and benefits, including but not
limited to any bonus payments earned in respect of fiscal 1998 but not yet paid,
under all Company Plans and employment or severance agreements between Company
and persons who are or had been employees of Company or any of its Subsidiaries
at or prior to the Effective Time ("Covered Employees"), all in accordance with
their respective terms.
(b) From and after the Effective Time, Parent shall, and shall
cause its Subsidiaries (including the Surviving Corporation) to, provide Covered
Employees who remain in the employ of Parent or any such Subsidiary employee
benefits that are reasonably comparable to the employee benefits provided to
similarly situated employees of Parent or any such Subsidiary who are not
Covered Employees. To the extent that Covered Employees are included
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in any benefit plan of Parent or its Subsidiaries, Parent agrees that the
Covered Employees shall receive credit under such plan for service prior to
the Effective Time with Company and its Subsidiaries to the same extent such
service was counted under similar Company Plans for purposes of eligibility,
vesting, eligibility for retirement (but not for benefit accrual) and, with
respect to vacation, disability and severance, benefit accrual. To the extent
that Covered Employees are included in any medical, dental or health plan
other than the plan or plans they participated in at the Effective Time, no
such plans shall include pre-existing condition exclusions, except to the
extent such exclusions were applicable under the similar Company Plan at the
Effective Time, and all such plans shall provide credit for any deductibles
and co-payments applied or made with respect to each Covered Employee in the
calendar year of the change.
(c) Notwithstanding anything in this Agreement to the
contrary, from and after the Effective Time, the Surviving Corporation will have
sole discretion over the hiring, promotion, retention, firing and other terms
and conditions of the employment of employees of the Surviving Corporation.
Except as otherwise provided in this Section 6.7, nothing herein shall prevent
Parent or the Surviving Corporation from amending or terminating any Company
Plan in accordance with its terms.
Section 6.8 INDEMNIFICATION; DIRECTORS' AND OFFICERS' INSURANCE.
(a) The provisions with respect to indemnification set forth
in the certificate of incorporation and bylaws of Merger Sub as in effect on the
date of this Agreement (true, correct and complete copies of which have been
provided to Company) shall be substantially identical to the corresponding
indemnification provisions, if any, contained in the certificate of
incorporation and by-laws of Company and, for a period of six years after the
Effective Time, shall not be amended, repealed or otherwise modified in any
manner that would adversely affect the rights thereunder of individuals who at
any time prior to the Effective Time were directors or officers of Company in
respect of actions or omissions occurring at or prior to the Effective Time
(including without limitation the transactions contemplated by this Agreement),
unless such modification is required by law.
(b) From and after the Effective Time, Parent shall, or shall
cause the Surviving Corporation to, indemnify, defend and hold harmless each
person who is now, or has been at any time prior to the date hereof or who
becomes prior to the Effective Time, an officer or director of Company (the
"Indemnified Parties") against all losses, claims, damages, costs, expenses
(including reasonable attorneys' fees and expenses), liabilities or judgments or
amounts that are paid in settlement with the approval of the indemnifying party
(which approval shall not be unreasonably withheld) incurred in connection with
any threatened or actual action, suit or proceeding based in whole or in part on
or arising in whole or in part out of the fact that such person is or was a
director or officer of Company ("Indemnified Liabilities"), including all
Indemnified Liabilities based in whole or in part on, or arising in whole or in
part out of, this Agreement or the transactions contemplated hereby, in each
case, to the full extent that a corporation is permitted under the DGCL to
indemnify its own directors or officers, as the case may be (and shall pay
expenses in advance of the final disposition of any such action, suit or
proceeding to each Indemnified Party to the full extent permitted by the DGCL,
upon receipt of an undertaking by or on behalf of such Indemnified Party to
repay such amount if it shall
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ultimately be determined that such person is not entitled to be so indemnified).
In the event any such claim, action, suit, proceeding or investigation is
brought against any Indemnified Party, the indemnifying party shall have a right
to assume and direct all aspects of the defense thereof, including settlement,
and the Indemnified Party shall cooperate in the vigorous defense of any such
matter. The Indemnified Party shall have a right to participate in (but not
control) the defense of any such matter with its own counsel and at its own
expense. The indemnifying party shall not settle any such matter unless (i) the
Indemnified Party gives prior written consent, which shall not be unreasonably
withheld, or (ii) the terms of the settlement provide that the Indemnified Party
shall have no responsibility for the discharge of any settlement amount and
impose no other obligations or duties on the Indemnified Party and the
settlement provides the Indemnified Parties with a full release and discharges
all rights against the Indemnified Party with respect to such matter. In no
event shall the indemnifying party be liable for any settlement effected without
its prior written consent. Any Indemnified Party wishing to claim
indemnification under this Section 6.8(b), upon learning of any such claim,
action, suit, proceeding or investigation, shall notify Parent and the Surviving
Corporation (but the failure so to notify shall not relieve the indemnifying
party from any liability which it may have under this Section 6.8(b) except to
the extent such failure prejudices such indemnifying party), and shall deliver
to Parent and the Surviving Corporation the undertaking contemplated by Section
145(e) of the DGCL. The Indemnified Parties as a group will be represented by a
single law firm with respect to each such matter unless there is, under
applicable standards of professional conduct (as determined in good faith by
counsel to the Indemnified Parties), a conflict on any significant issue between
the positions of any two or more Indemnified Parties. The rights to
indemnification under this Section 6.8(b) shall continue in full force and
effect for a period of four years from the Effective Time; provided, however,
that all rights to indemnification in respect of any Indemnified Liabilities
asserted or made within such period shall continue until the disposition of such
Indemnified Liabilities.
(c) For a period commencing at the Effective Time and expiring
on the sixth anniversary of the Effective Time, Parent shall cause to be
maintained in effect policies of directors' and officers' liability insurance,
for the benefit of those persons who are covered by Company's directors' and
officers' liability insurance policies at the Effective Time, providing coverage
with respect to matters occurring prior to the Effective Time that is at least
equal to the coverage provided under Company's current directors' and officers'
liability insurance policies, to the extent that such liability insurance can be
maintained at an annual cost to Parent not greater than $350,000; provided that
if such insurance cannot be so maintained at such cost, Parent shall maintain as
much of such insurance as can be so maintained at a cost equal to $350,000.
(d) The provisions of this Section 6.8 (i) are intended to be
for the benefit of, and will be enforceable by, each Indemnified Party, his or
her heirs and his or her representatives and (ii) are in addition (without
duplication) to any other rights to indemnification or contribution that any
such person may have by contract or otherwise.
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ARTICLE VII
CONDITIONS PRECEDENT
Section 7.1 CONDITIONS TO EACH PARTY'S OBLIGATION TO EFFECT THE MERGER.
The respective obligation of each party to effect the Merger shall be subject to
the satisfaction or written waiver on or prior to the Closing Date of the
following conditions:
(a) COMPLETION OF THE OFFER. Merger Sub shall have accepted
for payment and paid for all Shares validly tendered in the Offer and not
withdrawn; provided, however, that neither Parent nor Merger Sub may invoke this
condition if Merger Sub shall have failed to purchase Shares so tendered and not
withdrawn in violation of the terms of this Agreement or the Offer.
(b) STOCKHOLDER APPROVAL. This Agreement shall have been
adopted by the affirmative vote of the holders of the requisite number of shares
of capital stock of Company if such vote is required pursuant to Company's
certificate of incorporation, the DGCL or other applicable law.
(c) NO INJUNCTIONS OR RESTRAINTS. No temporary restraining
order, preliminary or permanent injunction or other order issued by any court of
competent jurisdiction or other legal restraint or prohibition preventing the
consummation of the Merger shall be in effect; provided, however, that prior to
invoking this condition, the party so invoking this condition shall have
complied with its obligations under Section 6.6.
(d) HSR ACT. All necessary waiting periods under the HSR Act
applicable to the Merger shall have expired or been earlier terminated.
ARTICLE VIII
TERMINATION, AMENDMENT AND WAIVER
Section 8.1 TERMINATION.
(a) This Agreement may be terminated and the transactions
contemplated hereby may be abandoned at any time prior to the Effective Time,
notwithstanding adoption thereof by the stockholders of Company, in any one of
the following circumstances:
(i) By mutual written consent duly authorized by
the Boards of Directors of Parent and Company, subject to Section 1.4(b).
(ii) By Parent or Company, if Shares have not been
purchased by Merger Sub pursuant to the Offer on or before April 30, 1999,
otherwise than as a result of any material breach of any provision of this
Agreement by the party seeking to effect such termination.
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(iii) By Parent or Company if, as the result of the
failure of any of the conditions set forth in Exhibit A to this Agreement, the
Offer shall have expired or Merger Sub shall have terminated the Offer in
accordance with its terms without Merger Sub having purchased any Shares
pursuant to the Offer; provided, however, that the right to terminate this
Agreement pursuant to this Section 8.1(a)(iii) shall not be available to any
party whose breach of or failure to fulfill its obligations under this Agreement
resulted in the failure of any such condition;
(iv) By Parent or Company, if any court of
competent jurisdiction or other Governmental Entity shall have issued an order,
decree or ruling or taken any other action permanently enjoining, restraining or
otherwise prohibiting the Merger or the acceptance for payment of, or payment
for, the Shares pursuant to the Offer and such order, decree or ruling or other
action shall have become final and nonappealable, provided that the party
seeking to terminate this Agreement shall have used its reasonable best efforts
to remove or lift such order, decree or ruling;
(v) By Parent, if the Board of Directors of Company
or any committee thereof shall have (A) withdrawn or modified in a manner
adverse to Parent or Merger Sub, or publicly taken a position materially
inconsistent with, its approval or recommendation of this Agreement, the Offer,
the Merger or the other transactions contemplated hereby, (B) approved, endorsed
or recommended an Acquisition Proposal, or (C) resolved or publicly disclosed
any intention to do any of the foregoing;
(vi) By Company, following the receipt by Company
after the date hereof, under circumstances not involving any breach of the
provisions of Section 6.5(a), of a bona fide written Acquisition Proposal, if
the Board of Directors of Company, after consultation with and based upon the
advice of independent legal counsel, shall have determined in good faith that
the failure to terminate this Agreement would constitute a breach by the Board
of Directors of Company of its fiduciary duties to Company's stockholders under
applicable law; provided that (A) Company has complied with all provisions of
Section 6.5, including the notice provisions therein, (B) Company enters into a
definitive agreement providing for the transactions contemplated by such
Acquisition Proposal immediately following such termination, and (C) such
termination shall not be effective until Company shall have paid to Parent the
Fee (as defined below) in accordance with provisions of Section 8.1(b); or
(vii) by Company if Merger Sub or Parent shall have
(A) failed to commence the Offer within five business days after the public
announcement by Parent and Company of this Agreement, (B) failed to pay for the
Shares pursuant to the Offer in accordance with this Agreement, or (C) breached
in any material respect any of their respective representations, warranties,
covenants or other agreements contained in this Agreement, which breach
described in this clause (C) is incapable of being cured or has not been cured
within 20 days after the giving of written notice to Parent or Merger Sub, as
applicable, except such breaches described in this clause (C) as individually or
in the aggregate would not reasonably be expected to materially and adversely
affect the ability of Parent or Merger Sub to complete the Offer or the Merger
on the terms and subject to the conditions of this Agreement.
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(b) If this Agreement is terminated pursuant to Section
8.1(a)(v) or (vi), then, in such event, Company shall pay to Parent a fee in the
amount of $5,000,000 (the "Fee"), which amount shall be payable in immediately
available funds (i) promptly (and in any event within three business days) after
such termination, in the case of termination pursuant to Section 8.1(a)(v) or
(ii) prior to or concurrently with such termination, in the case of termination
pursuant to Section 8.1(a)(vi).
Section 8.2 EFFECT OF TERMINATION. In the event of the termination and
abandonment of this Agreement pursuant to Section 8.1(a) hereof, this Agreement
(except for the provisions of Section 4.1(t), Section 4.2(f), Section 6.2,
Section 6.4, paragraph (b) of Section 8.1, this Section 8.2 and Article IX)
shall forthwith become void and cease to have any force or effect, without any
liability on the part of any party hereto or any of its affiliates; provided,
however, that nothing in this Section 8.2 shall relieve any party to this
Agreement of liability for any willful or intentional breach of this Agreement.
Section 8.3 AMENDMENT. Subject to any applicable provisions of the DGCL
and Section 1.4(b), at any time prior to the Effective Time, the parties hereto
may modify or amend this Agreement by written agreement executed and delivered
by duly authorized officers of the respective parties; provided, however, that
after adoption of this Agreement at the Stockholders Meeting, no amendment shall
be made which would reduce the amount or change the type of consideration into
which each Share shall be converted upon consummation of the Merger. This
Agreement may not be modified or amended except by written agreement executed
and delivered by duly authorized officers of each of the respective parties.
Section 8.4 EXTENSION; WAIVER. At any time prior to the Effective Time,
the parties may (a) extend the time for the performance of any of the
obligations or other acts of the other parties, (b) waive any inaccuracies in
the representations and warranties of the other parties contained in this
Agreement or in any document delivered pursuant to this Agreement, or (c)
subject to Section 8.3, waive compliance with any of the agreements or
conditions of the other parties contained in this Agreement, in each case
subject to Section 1.4(b). Any agreement on the part of a party to any such
extension or waiver shall be valid only if set forth in a written instrument
executed and delivered by a duly authorized officer on behalf of such party. The
failure of any party to this Agreement to assert any of its rights under this
Agreement or otherwise shall not constitute a waiver of such rights.
Section 8.5 PROCEDURE FOR TERMINATION, AMENDMENT, EXTENSION OR WAIVER.
A termination of this Agreement pursuant to Section 8.1, an amendment of this
Agreement pursuant to Section 8.3 or an extension or waiver pursuant to Section
8.4 shall, in order to be effective, require in the case of Parent, Merger Sub
or Company, action by its Board of Directors or the duly authorized designee of
its Board of Directors.
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ARTICLE IX
GENERAL PROVISIONS
Section 9.1 NONSURVIVAL OF REPRESENTATIONS AND WARRANTIES. None of the
representations and warranties in this Agreement or in any instrument delivered
pursuant to this Agreement shall survive the Effective Time. This Section 9.1
shall not limit any covenant or agreement of the parties which by its terms
contemplates performance after the Effective Time.
Section 9.2 FEES AND EXPENSES. Whether or not the Merger shall be
consummated, each party hereto shall pay its own expenses incident to preparing
for, entering into and carrying out this Agreement and the consummation of the
transactions contemplated hereby.
Section 9.3 DEFINITIONS. For purposes of this Agreement:
(a) an "affiliate" of any person means another person that
directly or indirectly, through one or more intermediaries, controls, is
controlled by, or is under common control with, such first person;
(b) "business day" means any day other than Saturday, Sunday
or any other day on which banks in the City of New York are required or
permitted to close;
(c) "Disclosure Schedule" means the disclosure schedule
delivered by Company to Parent simultaneously with the execution of this
Agreement;
(d) "Environmental Laws" means any federal, state or local law
relating to: (i) releases or threatened releases of Hazardous Substances or
materials containing Hazardous Substances; (ii) the manufacture, handling,
transport, use, treatment, storage or disposal of Hazardous Substances or
materials containing Hazardous Substances; or (iii) otherwise relating to
pollution of the environment or the protection of human health;
(e) "Fiber Cement Agreement" means the Asset Purchase
Agreement, dated December 21, 1998, among Company, ABTco, Inc. and CertainTeed
Corporation, including all its schedules and exhibits, as the same may be
amended from time to time with Parent's prior written consent;
(f) "Hazardous Substances" means: (i) those materials,
pollutants and/or substances defined in or regulated under the following federal
statutes and their state counterparts, as each may be amended from time to time,
and all regulations thereunder: the Hazardous Materials Transportation Act, the
Resource Conservation and Recovery Act, the Comprehensive Environmental
Response, Compensation and Liability Act, the Clean Water Act, the Safe Drinking
Water Act, the Atomic Energy Act, the Federal Insecticide, Fungicide and
Rodenticide Act and the Clean Air Act; (ii) petroleum and petroleum products
including crude oil and any fractions thereof; (iii) natural gas, synthetic gas
and any mixtures thereof; (iv) radon; (v) any other contaminant; and (vi) any
materials, pollutants and/or substance with respect to
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which any Governmental Entity requires environmental investigation, monitoring,
reporting or remediation;
(g) "knowledge" means the actual knowledge of any executive
officer of Company or Parent, as the case may be;
(h) "Liens" means, collectively, all pledges, claims, liens,
charges, mortgages, conditional sale or title retention agreements,
hypothecations, collateral assignments, security interests, easements and other
encumbrances of any kind or nature whatsoever;
(i) a "Material Adverse Effect" with respect to any person
means a material adverse effect on (i) the ability of such person to perform its
obligations under this Agreement or to consummate the transactions contemplated
hereby or (ii) the assets, liabilities (actual or contingent), financial
condition, results of operations or business of such person and its Subsidiaries
taken as a whole, excluding any change or development resulting from (x) events
adversely affecting any principal markets served by the business of Company
generally or affecting the hardboard siding industry generally which do not have
a disproportionate adverse effect on Company or its Subsidiaries, (y) general
economic conditions, including changes in the economies of any of the
jurisdictions in which Company or any of its Subsidiaries conduct business which
do not have a disproportionate adverse effect on Company or its Subsidiaries, or
(z) this Agreement, the Stockholder Agreement or any transaction contemplated
hereby or thereby;
(j) a "Permitted Lien" has the meaning set forth in Section
4.1(h)(ii) hereof;
(k) a "person" means an individual, corporation, partnership,
limited liability company, joint venture, association, trust, unincorporated
organization or other entity;
(l) "Principal Stockholders" means Kohlberg Associates, L.P.,
KABT Acquisition Company, L.P. and George T. Brophy;
(m) a "Subsidiary" of any person means any other person of
which (i) the first mentioned person or any Subsidiary thereof is a general
partner, (ii) voting power to elect a majority of the board of directors or
others performing similar functions with respect to such other person is held by
the first mentioned person and/or by any one or more of its Subsidiaries, or
(iii) at least 50% of the equity interests of such other person is, directly or
indirectly, owned or controlled by such first mentioned person and/or by any one
or more of its Subsidiaries.
Section 9.4 NOTICES. All notices, requests, claims, demands and other
communications under this Agreement shall be in writing and shall be deemed
given if delivered personally or sent by overnight courier (providing proof of
delivery) to the parties at the following addresses (or at such other address
for a party as shall be specified by like notice):
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(i) if to Parent or to Merger Sub, to
Louisiana-Pacific Corporation
111 SW Fifth Avenue, #-4200
Portland, Oregon 97204
Attention: Mr. Mark Suwyn
Chairman and Chief Executive Officer
Telecopy: (503) 821-5322
with a copy (which shall not constitute notice) to:
Jones, Day, Reavis & Pogue
599 Lexington Avenue
32nd Floor
New York, New York, 10022
Attention: Robert A. Profusek, Esq.
Mark E. Betzen, Esq.
Telecopy: (212) 755-7306
(ii) if to Company, to
ABT Building Products Corporation
One Neenah Center, Suite 600
Neenah, Wisconsin 54956
Attention: Mr. George T. Brophy
Chairman and Chief Executive Officer
Telecopy: (920) 791-0370
with a copy (which shall not constitute notice) to:
Paul, Weiss, Rifkind, Wharton & Garrison
1285 Avenue of the Americas
New York, New York 10019-6064
Attention: Bruce A. Gutenplan, Esq.
Telecopy: (212) 757-3990
Section 9.5 INTERPRETATION. When a reference is made in this Agreement
to a Section, such reference shall be to a Section of this Agreement unless
otherwise indicated. The table of contents and headings contained in this
Agreement are for convenience of reference purposes only and shall not affect in
any way the meaning or interpretation of this Agreement. Whenever the words
"include", "includes" or "including" are used in this Agreement, they shall be
deemed to be followed by the words "without limitation".
Section 9.6 ENTIRE AGREEMENT; THIRD-PARTY BENEFICIARIES. This Agreement
constitutes the entire agreement, and supersede all prior agreements and
understandings, both written and oral, among the parties with respect to the
subject matter of this Agreement (except for the letter
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agreement referenced in the last sentence of Section 6.2). Except to the extent
set forth in Section 6.8, this Agreement is not intended to confer upon any
person (including without limitation any employees or former employees of
Company), other than the parties hereto, any rights or remedies.
Section 9.7 GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware, regardless of
the laws that might otherwise govern under applicable principles of conflicts of
laws thereof.
Section 9.8 ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations under this Agreement may be assigned or delegated, in
whole or in part, by operation of law or otherwise by any of the parties without
the prior written consent of the other parties, and any such assignment without
such prior written consent shall be null and void, except that Parent and/or
Merger Sub may assign this Agreement to any direct or indirect wholly owned
Subsidiary of Parent without the prior consent of Company; provided that Parent
and/or Merger Sub, as the case may be, shall remain liable for all of its
obligations under this Agreement. Subject to the preceding sentence, this
Agreement will be binding upon, inure to the benefit of, and be enforceable by,
the parties and their respective successors and assigns.
Section 9.9 ENFORCEMENT. Irreparable damage would occur in the event
that any of the provisions of this Agreement were not performed in accordance
with their specific terms or were otherwise breached. Accordingly, the parties
shall be entitled to an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions of this Agreement
in the Court of Chancery in and for New Castle County in the State of Delaware
(or, if such court lacks subject matter jurisdiction, any appropriate state or
federal court in New Castle County in the State of Delaware), this being in
addition to any other remedy to which they are entitled at law or in equity.
Each of the parties hereto (i) shall submit itself to the personal jurisdiction
of the Court of Chancery in and for New Castle County in the State of Delaware
(or, if such court lacks subject matter jurisdiction, any appropriate state or
federal court in New Castle County in the State of Delaware) in the event any
dispute arises out of this Agreement or any of the transactions contemplated
hereby, (ii) shall not attempt to deny or defeat such personal jurisdiction by
motion or other request for leave from any such court, and (iii) shall not bring
any action relating to this Agreement or any of the transactions contemplated
hereby in any court other than the Court of Chancery in and for New Castle
County in the State of Delaware (or, if such court lacks subject matter
jurisdiction, any appropriate state or federal court in New Castle County in the
State of Delaware).
Section 9.10 SEVERABILITY. Whenever possible, each provision or portion
of any provision of this Agreement shall be interpreted in such manner as to be
effective and valid under applicable law, but if any provision or portion of any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision
or portion of any provision in such jurisdiction, and this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision or portion of any provision had never been
contained herein.
39
<PAGE>
Section 9.11 COUNTERPARTS. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same instrument
and shall become effective when one or more counterparts have been signed by
each of the parties and delivered to the other parties.
[signature page follows]
40
<PAGE>
IN WITNESS WHEREOF, Parent, Merger Sub and Company have caused this
Agreement to be signed by their respective officers thereunto duly authorized,
all as of the date first written above.
LOUISIANA-PACIFIC CORPORATION
By: /S/ MARK A. SUWYN
---------------------------------
Name: MARK A. SUWYN
------------------------------
Title: CHIEF EXECUTIVE OFFICER
------------------------------
STRIPER ACQUISITION, INC.
By: /S/ MARK A. SUWYN
---------------------------------
Name: MARK A. SUWYN
------------------------------
Title: PRESIDENT
------------------------------
ABT BUILDING PRODUCTS CORPORATION
By: /S/ GEORGE T. BROPHY
---------------------------------
Name: GEORGE T. BROPHY
------------------------------
Title: CHIEF EXECUTIVE OFFICER
------------------------------
41
<PAGE>
EXHIBIT A
Unless otherwise defined herein, capitalized terms used herein shall
have the meanings ascribed to them in the Agreement and Plan of Merger among the
Parent, Merger Sub and Company to which this Exhibit A is attached (the
"Agreement").
CONDITIONS TO THE OFFER. Notwithstanding any other provision of the
Offer, Merger Sub shall not be required to accept for payment or, subject to any
applicable rules and regulations of the SEC, including Rule 14e-1(c) under the
Exchange Act (relating to Merger Sub's obligation to pay for or return tendered
Shares promptly after expiration or termination of the Offer), to pay for any
Shares tendered, and may postpone the acceptance for payment or, subject to the
restrictions referred to above, payment for any Shares tendered, and, subject to
the terms of the Agreement, may amend or terminate the Offer (whether or not any
Shares have theretofore been purchased or paid for pursuant to the Offer) if (i)
there shall not have been validly tendered and not withdrawn prior to the time
the Offer shall otherwise expire a number of Shares (together with any Shares
then owned by Parent or any of its Subsidiaries) which constitutes a majority of
the Shares outstanding on a fully-diluted basis on the date of purchase (the
"Minimum Share Condition") ("on a fully-diluted basis" having the following
meaning, as of any date: the number of Shares outstanding (excluding Shares held
as treasury stock by Company or any of its Subsidiaries), together with the
number of Shares Company is then required to issue pursuant to obligations
outstanding at that date under employee stock option or other benefit plans or
otherwise other than unvested Options), (ii) any applicable waiting periods
under the HSR Act shall not have expired or been terminated prior to the
expiration of the Offer, or (iii) if at any time on or after the date of the
Agreement and before acceptance for payment of, or payment for, the Shares, any
of the following events shall have occurred and remain in effect:
(a) any United States or Canadian governmental entity or
authority or any United States or Canadian court of competent
jurisdiction in the United States or in Canada shall have enacted,
issued, promulgated, enforced or entered any statute, rule, regulation,
executive order, decree, injunction or other order which is in effect
and which (1) materially restricts, prevents or prohibits consummation
of the transactions contemplated by the Agreement, including the Offer
or the Merger, (2) prohibits or limits materially the ownership or
operation by Parent or any of its Subsidiaries of all or any material
portion of the business or assets of Company and its Subsidiaries taken
as a whole or compels Company, Parent, or any of their Subsidiaries to
dispose of or hold separate all or any material portion of the business
or assets of Company and its Subsidiaries taken as a whole, or (3)
imposes material limitations on the ability of Parent, Merger Sub or
any other Subsidiary of Parent to exercise effectively full rights of
ownership of any Shares, including without limitation the right to vote
any Shares acquired by Merger Sub pursuant to the Offer or otherwise on
all matters properly presented to Company's stockholders, including
without limitation the approval and adoption of the Agreement and the
transactions contemplated thereby;
A-1
<PAGE>
(b) there shall have been instituted or pending any action or
proceeding before any United States or Canadian court or governmental
entity or authority by any United States or Canadian governmental
entity or authority seeking any order, decree or injunction having any
effect set forth in (a) above;
(c) the representations and warranties of Company contained in
the Agreement (without giving effect to the materiality qualifications
contained therein) shall not be true and correct as of the expiration
date of the Offer (as the same may be extended from time to time) as
though made on and as of such date (except for representations and
warranties made as of a specified date, which need be true and correct
only as of the specified date), except for any breach or breaches which
,individually or in the aggregate, would not reasonably be expected to
have a Material Adverse Effect on Company (provided that this exception
shall not apply to the representations and warranties of Company
relating to the capital structure of Company);
(d) Company shall not have performed or complied in all
material respects with its obligations under the Agreement to be
performed or complied with by it and such failure continues until the
later of (A) fifteen days after actual receipt by it of written notice
from Merger Sub setting forth in detail the nature of such failure or
(B) the expiration date of the Offer;
(e) there shall have occurred any material adverse change, or
any development that is reasonably likely to result in a material
adverse change in the assets, liabilities (actual or contingent),
results of operations or business of Company and its Subsidiaries taken
as a whole, excluding any change or development resulting from (A)
events adversely affecting any principal markets served by the business
of Company generally or affecting the hardboard siding industry
generally which do not have a disproportionate adverse effect on
Company or its Subsidiaries, (B) general economic conditions, including
changes in the economies of any of the jurisdictions in which Company
or any of its Subsidiaries conduct business which do not have a
disproportionate adverse effect on Company or its Subsidiaries, or (C)
this Agreement, the Stockholder Agreement or any transaction
contemplated hereby or thereby;
(f) the Merger Agreement shall have been terminated in
accordance with its terms;
(g) the Board of Directors of Company or any committee thereof
shall have (A) withdrawn or modified in a manner adverse to Parent or
Merger Sub, or publicly taken a position materially inconsistent with,
its approval or recommendation of this Agreement, the Offer, the Merger
or the other transactions contemplated hereby, (B) approved, endorsed
or recommended an Acquisition Proposal, or (C) resolved or publicly
disclosed any intention to do any of the foregoing; or
(h) there shall have occurred (i) any general suspension of,
or limitation on prices (other than suspensions or limitations
triggered by price fluctuations on a trading day) for, trading in
securities on any national securities exchange in the United States,
A-2
<PAGE>
(ii) the declaration of a banking moratorium or any limitation or
suspension of payments in respect of the extension of credit by banks
or other lending institutions in the United States, (iii) any
commencement of war, armed hostilities or other international or
national calamity directly involving the United States having a
significant adverse effect on the functionality of financial markets
in the United States, or (iv) in the case of any of the foregoing,
existing at time of the commencement of the Offer, a material
acceleration or worsening thereof.
The foregoing conditions (other than the Minimum Share Condition) are
for the sole benefit of Merger Sub and its affiliates and may be asserted by
Merger Sub regardless of the circumstances giving rise to any such condition or
may be waived by Merger Sub, in whole or in part, from time to time in its sole
discretion, except as otherwise provided in the Agreement. The failure by Merger
Sub 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
and may be asserted at any time and from time to time.
Should the Offer be terminated pursuant to the foregoing provisions,
all tendered Shares not theretofore accepted for payment shall forthwith be
returned to the tendering stockholders.
A-3
<PAGE>
Exhibit 99(c)(2)
EXECUTION COPY
STOCKHOLDER AGREEMENT
This STOCKHOLDER AGREEMENT, dated as of January 19, 1999 (this
"Agreement"), is made and entered into among Louisiana-Pacific Corporation, a
Delaware corporation ("Parent"), Striper Acquisition, Inc., a Delaware
corporation and wholly owned subsidiary of Parent ("Merger Sub"), and Kohlberg
Associates, L.P., KABT Acquisition Company, L.P. and George T. Brophy (each, a
"Stockholder" and, collectively, the "Stockholders").
RECITALS:
A. Parent, Merger Sub and ABT Building Products Corporation, a Delaware
corporation ("Company"), propose to enter into an Agreement and Plan of Merger,
dated as of the date hereof (the "Merger Agreement"), pursuant to which Merger
Sub will merge with and into Company (the "Merger") on the terms and subject to
the conditions set forth in the Merger Agreement. Except as otherwise defined
herein, terms used herein with initial capital letters have the respective
meanings ascribed thereto in the Merger Agreement.
B. As of the date hereof, each Stockholder beneficially owns and is
entitled to dispose of (or to direct the disposition of) and to vote (or to
direct the voting of) the number of Shares set forth opposite such Stockholder's
name on Schedule A hereto (such Shares, together with any other Shares the
beneficial ownership of which is acquired by such Stockholder during the period
from and including the date hereof through and including the date on which this
Agreement is terminated pursuant to Section 6.2 hereof, are collectively
referred to herein as such Stockholder's "Subject Shares").
C. As a condition and inducement to their willingness to enter into the
Merger Agreement, Parent and Merger Sub have requested that each Stockholder
agree, and each Stockholder has agreed, to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the
representations, warranties and covenants contained in this Agreement, and for
other good and valuable consideration, the receipt and sufficiency of which are
hereby acknowledged, the parties hereto hereby agree as follows:
ARTICLE I
TENDER OF SHARES
Section 1.1 AGREEMENT TO TENDER SHARES. Each Stockholder shall cause to
be validly tendered (and not withdrawn) pursuant to and in accordance with the
terms of the Offer (provided that if the Offer is amended in any manner set
forth in Section 1.1(b) of the Merger Agreement as requiring the consent of
Company, the Stockholders shall not be obligated to tender hereunder unless the
amendment is made with their prior written approval which shall not be
unreasonably withheld), not later than the tenth business day after commencement
of the Offer pursuant to Section 1.1 of the Merger Agreement and Rule 14d-2
under the Exchange Act, all of such Stockholder's Subject Shares. Each
Stockholder hereby acknowledges that Merger Sub's
<PAGE>
obligation to accept for payment and pay for Shares (including such
Stockholder's Subject Shares) pursuant to the Offer is subject to the terms and
conditions of the Offer set forth in the Merger Agreement. For all of the
Subject Shares validly tendered in the Offer and not withdrawn, the Stockholders
will be entitled to receive the highest price paid by Merger Sub in the Offer.
ARTICLE II
VOTING OF SHARES
Section 2.1 AGREEMENT TO VOTE SHARES. At any meeting of the
stockholders of Company called to consider and vote upon the adoption of the
Merger Agreement (and at any and all postponements and adjournments thereof),
and in connection with any action to be taken in respect of the adoption of the
Merger Agreement by written consent of stockholders of Company, each Stockholder
shall vote or cause to be voted (including by written consent, if applicable)
all of such Stockholder's Subject Shares in favor of the adoption of the Merger
Agreement and in favor of any other matter necessary for the consummation of the
transactions contemplated by the Merger Agreement and considered and voted upon
at any such meeting or made the subject of any such written consent, as
applicable. At any meeting of the stockholders of Company called to consider and
vote upon any Adverse Proposal (as hereinafter defined) (and at any and all
postponements and adjournments thereof), and in connection with any action to be
taken in respect of any Adverse Proposal by written consent of stockholders of
Company, each Stockholder shall vote or cause to be voted (including by written
consent, if applicable) all of such Stockholder's Subject Shares against such
Adverse Proposal. For purposes of this Agreement, the term "Adverse Proposal"
means any (a) Acquisition Proposal, (b) proposal or action that would reasonably
be expected to result in a breach of any covenant, representation or warranty of
Company set forth in the Merger Agreement, or (c) proposal or action that is
intended or would reasonably be expected to impede, interfere with, delay or
materially and adversely affect the Merger or any of the other transactions
contemplated by the Merger Agreement or this Agreement.
Section 2.2 IRREVOCABLE PROXY.
(a) GRANT OF PROXY. EACH STOCKHOLDER HEREBY APPOINTS PARENT
AND ANY DESIGNEE OF PARENT, EACH OF THEM INDIVIDUALLY, SUCH STOCKHOLDER'S PROXY
AND ATTORNEY-IN-FACT PURSUANT TO THE PROVISIONS OF SECTION 212 OF THE DELAWARE
GENERAL CORPORATION LAW, WITH FULL POWER OF SUBSTITUTION AND RESUBSTITUTION, TO
VOTE OR ACT BY WRITTEN CONSENT WITH RESPECT TO SUCH STOCKHOLDER'S SUBJECT SHARES
IN ACCORDANCE WITH SECTION 2.1 HEREOF. THIS PROXY IS GIVEN TO SECURE THE
PERFORMANCE OF THE DUTIES OF SUCH STOCKHOLDER UNDER THIS AGREEMENT. EACH
STOCKHOLDER AFFIRMS THAT THIS PROXY IS COUPLED WITH AN INTEREST AND SHALL BE
IRREVOCABLE. EACH STOCKHOLDER SHALL TAKE SUCH FURTHER ACTION OR EXECUTE SUCH
OTHER INSTRUMENTS AS MAY BE NECESSARY TO EFFECTUATE THE INTENT OF THIS PROXY.
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<PAGE>
(b) OTHER PROXIES REVOKED. Each Stockholder represents that
any proxies heretofore given in respect of such Stockholder's Subject Shares are
not irrevocable, and that all such proxies are hereby revoked.
ARTICLE III
PURCHASE OPTION
Section 3.1 GRANT OF OPTION. Each Stockholder hereby grants to Parent
an irrevocable option (each, an "Option" and, collectively, the "Options") to
purchase such Stockholder's Subject Shares on the terms and subject to the
conditions set forth herein at a purchase price per share equal to $15.00 or the
highest per share price paid in the Offer (the "Purchase Price"). If (i) the
Offer is consummated but (whether due to improper tender or withdrawal of
tender) Merger Sub has not accepted for payment and paid for all of the Subject
Shares, or (ii) the Merger Agreement is terminated (otherwise than pursuant to
Section 8.1(a)(i) thereof or pursuant to Section 8.1(a)(iv) thereof under
circumstances in which Company is entitled to so terminate the Merger Agreement)
in accordance with its terms for reasons other than the failure of Parent or
Merger Sub to fulfill their respective obligations under the Merger Agreement,
the Options shall, in any such case, become exercisable (in whole but not in
part) upon the first to occur of any such event and remain exercisable (in whole
but not in part) until the date that is 30 days after the date of the occurrence
of an event in clause (i) above, or the date that is 90 days after the date of
the occurrence of the event in clause (ii) above (the applicable period of
exercisability being the "Option Period").
Section 3.2 EXERCISE OF OPTION. (a) Parent may exercise all of the
Options, in whole but not in part, at any time or from time to time during the
Option Period. Notwithstanding anything in this Agreement to the contrary,
Parent shall be entitled to purchase all Subject Shares in respect of which it
shall have exercised an Option in accordance with the terms hereof prior to the
expiration of the Option Period, and the expiration of the Option Period shall
not affect any rights hereunder which by their terms do not terminate or expire
prior to or as of such expiration.
(b) If Parent wishes to exercise an Option, it shall deliver
to the applicable Stockholder (each a "Selling Stockholder") a written notice
(an "Exercise Notice") to that effect which specifies a date (an "Option Closing
Date") not earlier than three business days after the date such Exercise Notice
is delivered for the consummation of the purchase and sale of such Subject
Shares (an "Option Closing"). If the Option Closing cannot be effected on the
Option Closing Date specified in the Exercise Notice by reason of any applicable
judgment, decree, order, law or regulation, or because any applicable waiting
period under the HSR Act shall not have expired or been terminated, (i) the
Stockholders shall promptly take all such actions as may be requested by Parent,
and shall otherwise fully cooperate with Parent, to cause the elimination of all
such impediments to the Option Closing and (ii) the Option Closing Date
specified in the Exercise Notice shall be extended to the third business day
following the elimination of all such impediments. The place of the Option
Closing shall be at the offices of Jones, Day, Reavis & Pogue, 599 Lexington
Avenue, 32nd Floor, New York, New York 10022, and the time of the Option Closing
shall be 10:00 a.m. (Eastern Time) on the Option Closing Date.
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<PAGE>
Section 3.3 PAYMENT AND DELIVERY OF CERTIFICATES. At any Option
Closing, Parent shall deliver to each Selling Stockholder, by wire transfer of
immediately available funds to such account as shall have been designated by
such Selling Stockholder to Parent prior to the Option Closing, the Purchase
Price payable in respect of the Subject Shares to be purchased from such Selling
Stockholder at the Option Closing, and each Selling Stockholder shall deliver to
Parent such Subject Shares, free and clear of all Liens, with the certificate or
certificates evidencing such Subject Shares being duly endorsed for transfer by
such Selling Stockholder and accompanied by all powers of attorney and/or other
instruments necessary to convey valid and unencumbered title thereto to Parent,
and shall assign to Parent (pursuant to a written instrument in form and
substance satisfactory to Parent) all rights that such Selling Stockholder may
have to require Company to register such Subject Shares under the Securities
Act.
Section 3.4 ADJUSTMENT UPON CHANGES IN CAPITALIZATION, ETC. In the
event of any change in the capital stock of Company by reason of a stock
dividend, subdivision, reclassification, recapitalization, split, combination,
exchange of shares, extraordinary distribution or similar transaction, the type
and number or amount of shares, securities or other property subject to each of
the Options, and the Purchase Price payable therefor, shall be adjusted
appropriately, and proper provision shall be made in the agreements governing
such transaction, so that (a) Parent shall receive upon exercise of any Option
the type and number or amount of shares, securities or property that Parent
would have retained and/or been entitled to receive in respect of the applicable
Selling Stockholder's Subject Shares if the Option had been exercised
immediately prior to such event relating to Company or the record date therefor,
as applicable, and (b) the applicable Selling Stockholder shall receive upon
exercise of any Option granted by such Selling Stockholder the amount of cash
that such Selling Stockholder would have received as a result of the exercise of
the Option if the Option had been exercised immediately prior to such event
relating to Parent or the record date therefor, as applicable. The provisions of
this Section 3.4 shall apply in a like manner to successive stock dividends,
subdivisions, reclassifications, recapitalizations, splits, combinations,
exchanges of shares, extraordinary distributions or similar transactions.
Section 3.5 ACQUIRED SHARES. In the event that Subject Shares are
acquired by Parent pursuant to the exercise of the Options (such acquired
Subject Shares being "Acquired Shares") and Parent thereafter sells, transfers
or disposes of Acquired Shares within 18 months after the acquisition of such
Acquired Shares (any such sale, transfer or disposition of Acquired Shares
occurring within such 18-month period being a "Sale"), Parent shall promptly pay
to the Selling Stockholders (pro rata, in proportion to the number of Acquired
Shares purchased from each Stockholder) an amount in cash equal to the positive
difference (if any) between the aggregate proceeds received by Parent in the
Sale (net of selling commissions, if any) and the aggregate Purchase Price paid
by Parent for the Acquired Shares sold, transferred or disposed of in such Sale.
Parent shall effect any Sale of Acquired Shares only to an unaffiliated party in
a bona fide arm's-length transaction.
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<PAGE>
ARTICLE IV
REPRESENTATIONS AND WARRANTIES
Section 4.1 CERTAIN REPRESENTATIONS AND WARRANTIES OF THE STOCKHOLDERS.
Each Stockholder, severally and not jointly, represents and warrants to Parent
as follows:
(a) OWNERSHIP. Such Stockholder is the sole record and
beneficial owner of the number of Shares set forth opposite such Stockholder's
name on Schedule A hereto and has full and unrestricted power to dispose of and
to vote such Shares. Such Shares are now, and at all times during the term
hereof will be, held by such Stockholder, or by a nominee or custodian for the
benefit of such Stockholder, free and clear of all Liens and proxies, except for
any Liens or proxies arising hereunder and restrictions set forth under
applicable securities laws or the Stockholders' Agreement, dated as of October
20, 1992, by and among Company, the Stockholders and other shareholders of
Company named therein (the "Stockholders' Agreement"). The transfer by such
Stockholder of its Subject Shares to Merger Sub pursuant to the Offer or the
applicable Option shall pass to and unconditionally vest in Merger Sub good and
valid title to such Subject Shares, free and clear of all Liens and other than
restrictions set forth under applicable securities laws or the Stockholders'
Agreement. Except as set forth in Schedule A hereto, such Stockholder does not
beneficially own any securities of Company on the date hereof other than such
Shares.
(b) POWER AND AUTHORITY; EXECUTION AND DELIVERY. Such
Stockholder has all requisite power and authority to enter into this Agreement
and to consummate the transactions contemplated hereby. In the case of each
Stockholder that is not a natural person, the execution and delivery of this
Agreement by such Stockholder and the consummation by such Stockholder of the
transactions contemplated hereby have been duly authorized by all necessary
action, if any, on the part of such Stockholder. This Agreement has been duly
executed and delivered by such Stockholder and, assuming that this Agreement
constitutes the valid and binding obligation of the other parties hereto,
constitutes a valid and binding obligation of such Stockholder, enforceable
against such Stockholder in accordance with its terms, subject to applicable
bankruptcy, insolvency, fraudulent conveyance, reorganization, moratorium and
similar laws affecting creditors' rights and remedies generally and to general
principles of equity.
(c) NO CONFLICTS. The execution and delivery of this Agreement
do not, and, subject to compliance with the HSR Act and appropriate filings
under securities laws (which each Stockholder agrees to make promptly), to the
extent applicable, the consummation of the transactions contemplated hereby and
compliance with the provisions hereof will not, conflict with, result in a
breach or violation of or default (with or without notice or lapse of time or
both) under, or give rise to a material obligation, a right of termination,
cancellation, or acceleration of any obligation or a loss of a material benefit
under, or require notice to or the consent of any person under any agreement,
instrument, undertaking, law, rule, regulation, judgment, order, injunction,
decree, determination or award binding on such Stockholder, other than as set
forth under the Stockholders' Agreement or any such conflicts, breaches,
violations, defaults, obligations, rights or losses that individually or in the
aggregate would not (i) impair the ability
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<PAGE>
of such Stockholder to perform such Stockholder's obligations under this
Agreement or (ii) prevent or delay the consummation of any of the transactions
contemplated hereby.
(d) STOCKHOLDERS' AGREEMENT. The Stockholders have delivered
or made available to Parent a true, correct and complete copy of the
Stockholders' Agreement, as amended to the date of this Agreement.
Section 4.2 REPRESENTATIONS AND WARRANTIES OF PARENT. Each of Parent
and Merger Sub hereby represents and warrants, jointly and severally, to each
Stockholder that:
(a) POWER AND AUTHORITY; EXECUTION AND DELIVERY. Each of
Parent and Merger Sub has all requisite corporate power and authority to enter
into this Agreement and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement by Parent and Merger Sub and the
consummation by Parent and Merger Sub of the transactions contemplated hereby
have been duly authorized by all necessary corporate action on the part of
Parent and Merger Sub. This Agreement has been duly executed and delivered by
Parent and Merger Sub and, assuming that this Agreement constitutes the valid
and binding obligation of each Stockholder, constitutes a valid and binding
obligation of Parent and Merger Sub, enforceable against Parent and Merger Sub
in accordance with its terms, subject to applicable bankruptcy, insolvency,
fraudulent conveyance, reorganization, moratorium and similar laws affecting
creditors' rights and remedies generally and to general principles of equity.
(b) NO CONFLICTS. The execution and delivery of this Agreement
do not, and, subject to compliance with the HSR Act and appropriate filings
under securities laws (which Parent and Merger Sub agree to make promptly), to
the extent applicable, the consummation of the transactions contemplated hereby
and compliance with the provisions hereof will not, conflict with, result in a
breach or violation of or default (with or without notice or lapse of time or
both) under, or give rise to a material obligation, right of termination,
cancellation, or acceleration of any obligation or a loss of a material benefit
under, or require notice to or the consent of any person under any agreement,
instrument, undertaking, law, rule, regulation, judgment, order, injunction,
decree, determination or award binding on Parent or Merger Sub, other than any
such conflicts, breaches, violations, defaults, obligations, rights or losses
that individually or in the aggregate would not (i) impair the ability of Parent
or Merger Sub to perform its obligations under this Agreement or (ii) prevent or
delay the consummation of any of the transactions contemplated hereby.
(c) SECURITIES LAW COMPLIANCE. The Options and the Subject
Shares to be acquired upon exercise of the Options are being and shall be
acquired by Parent without a view to public distribution thereof otherwise than
in compliance with the Securities Act and applicable state securities laws and
shall not be transferred or otherwise disposed of except in a transaction
registered or exempt from registration under the Securities Act and in
compliance with applicable state securities laws. Neither Parent nor Merger Sub
will effect any offer or sale of Subject Shares which would cause any
Stockholder to violate the registration requirements of the Securities Act of
1933, as amended, or the registration or qualification requirements of the
securities laws of any jurisdiction.
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<PAGE>
ARTICLE V
CERTAIN COVENANTS
Section 5.1 CERTAIN COVENANTS OF STOCKHOLDERS.
(a) RESTRICTION ON TRANSFER OF SUBJECT SHARES, PROXIES AND
NONINTERFERENCE. No Stockholder shall, directly or indirectly: (A) except
pursuant to the terms of this Agreement and for the conversion of Subject Shares
at the Effective Time pursuant to the terms of the Merger Agreement, offer for
sale, sell, transfer, tender, pledge, encumber, assign or otherwise dispose of,
or enter into any contract, option or other arrangement or understanding with
respect to or consent to the offer for sale, sale, transfer, tender, pledge,
encumbrance, assignment or other disposition of, any or all of such
Stockholder's Subject Shares; (B) except pursuant to the terms of this
Agreement, grant any proxies or powers of attorney, deposit any of such
Stockholder's Subject Shares into a voting trust or enter into a voting
agreement with respect to any of such Stockholder's Subject Shares; or (C) take
any action that would reasonably be expected to make any representation or
warranty contained herein untrue or incorrect or have the effect of impairing
the ability of such Stockholder to perform such Stockholder's obligations under
this Agreement or preventing or delaying the consummation of any of the
transactions contemplated hereby.
(b) NO SOLICITATION. Subject to Section 6.12, no Stockholder
shall take, or authorize or permit any of its officers, directors, employees,
agents or representatives (including any investment banker, financial advisor,
attorney or accountant) to take, any action that Company would be prohibited
from taking under the first sentence of Section 6.5(a) of the Merger Agreement
(disregarding for purposes of this Section 5.1(b) the proviso to such sentence).
(c) WAIVER OF APPRAISAL RIGHTS. Each Stockholder hereby waives
any rights of appraisal or rights to dissent from the Merger that such
Stockholder may have.
(d) NONEXERCISE OF RIGHTS OF FIRST REFUSAL. No Stockholder
shall exercise any purchase right or right of first refusal that it may have
with respect to any Shares of any other person in connection with any tender by
such other person of such Shares pursuant to the Offer.
(e) COOPERATION. Each Stockholder shall cooperate fully with
Parent and Company in connection with their respective reasonable best efforts
to fulfill the conditions to the Merger set forth in Article VII of the Merger
Agreement.
ARTICLE VI
MISCELLANEOUS
Section 6.1 FEES AND EXPENSES. Each party hereto shall pay its own
expenses incident to preparing for, entering into and carrying out this
Agreement and the consummation of the transactions contemplated hereby.
-7-
<PAGE>
Section 6.2 AMENDMENT; TERMINATION. This Agreement may not be amended
except by an instrument in writing signed on behalf of each of the parties
hereto. This Agreement shall terminate immediately upon the earlier of (i) the
Effective Time and (ii) the date on which the Option Period expires (or, if
later, the date on which the last Option Closing occurs). In addition, this
Agreement may be terminated at any time by mutual written consent of Parent and
Stockholders representing a majority of the Subject Shares subject to this
Agreement. In the event of termination of this Agreement pursuant to this
Section 6.2, this Agreement shall become null and void and of no effect with no
liability on the part of any party hereto and all proxies granted hereby shall
be automatically revoked; provided, however, that no such termination shall
relieve any party hereto from any liability for any breach of this Agreement
occurring prior to such termination, and provided further that the
representations and warranties set forth in Sections 4.1 and 4.2 and covenants
set forth in Section 6.1 shall survive the termination of this Agreement.
Section 6.3 EXTENSION; WAIVER. Any agreement on the part of a party to
waive any provision of this Agreement, or to extend the time for any performance
hereunder, shall be valid only if set forth in an instrument in writing signed
on behalf of such party. The failure of any party to this Agreement to assert
any of its rights under this Agreement or otherwise shall not constitute a
waiver of such rights.
Section 6.4 ENTIRE AGREEMENT; NO THIRD-PARTY BENEFICIARIES. This
Agreement constitutes the entire agreement, and supersedes all prior agreements
and understandings, both written and oral, among the parties with respect to the
subject matter of this Agreement, and is not intended to confer upon any person
other than the parties any rights or remedies.
Section 6.5 GOVERNING LAW. This Agreement shall be governed by, and
construed in accordance with, the laws of the State of Delaware, regardless of
the laws that might otherwise govern under applicable principles of conflict of
laws thereof.
Section 6.6 NOTICES. All notices, requests, claims, demands and other
communications under this Agreement shall be in writing and shall be deemed
given if delivered personally, or sent by overnight courier (providing proof of
delivery), in the case of the Stockholders, to the address set forth on Schedule
A hereto with a copy (which shall not constitute notice) to Paul, Weiss,
Rifkind, Wharton & Garrison, 1285 Avenue of the Americas, New York, New York
10019, Attention: Bruce A. Gutenplan, Esq., Telecopy: (212-757-3990, or, in the
case of Parent, to the address set forth below (or, in each case, at such other
address as shall be specified by like notice).
Louisiana-Pacific Corporation
111 S.W. Fifth Avenue, #4200
Portland, Oregon 97204
Attention: Mr. Mark Suwyn
Telecopy: (503) 821-5322
-8-
<PAGE>
with a copy (which shall not constitute notice) to:
Jones, Day, Reavis & Pogue
32nd Floor
599 Lexington Avenue
New York, NY 10022-6030
Attention: Robert A. Profusek, Esq.
Mark E. Betzen, Esq.
Telecopy: (212) 755-7306
Section 6.7 ASSIGNMENT. Neither this Agreement nor any of the rights,
interests, or obligations under this Agreement may be assigned or delegated, in
whole or in part, by operation of law or otherwise, by any Stockholder without
the prior written consent of Parent, and any such assignment or delegation that
is not consented to shall be null and void. This Agreement, together with any
rights, interests, or obligations of Parent hereunder, may be assigned or
delegated, in whole or in part, by Parent without the consent of or any action
by any Stockholder upon notice by Parent to each Stockholder affected thereby as
herein provided. Subject to the preceding sentence, this Agreement shall be
binding upon, inure to the benefit of, and be enforceable by, the parties and
their respective successors and assigns (including without limitation any person
to whom any Subject Shares are sold, transferred or assigned).
Section 6.8 FURTHER ASSURANCES. Each Stockholder shall execute and
deliver such other documents and instruments and take such further actions as
may be necessary or appropriate or as may be reasonably requested by Parent in
order to ensure that Parent receives the full benefit of this Agreement. Parent
and Merger Sub shall not amend the Merger Agreement to increase the Merger
Consideration without the prior written consent of Stockholders representing a
majority of the Subject Shares subject to this Agreement.
Section 6.9 ENFORCEMENT. Irreparable damage would occur in the event
that any of the provisions of this Agreement were not performed in accordance
with their specific terms or were otherwise breached. Accordingly, the parties
shall be entitled to an injunction or injunctions to prevent breaches of this
Agreement and to enforce specifically the terms and provisions of this Agreement
in the Court of Chancery in and for New Castle County in the State of Delaware
(or, if such court lacks subject matter jurisdiction, any appropriate state or
federal court in New Castle County in the State of Delaware), this being in
addition to any other remedy to which they are entitled at law or in equity.
Each of the parties hereto (i) shall submit itself to the personal jurisdiction
of the Court of Chancery in and for New Castle County in the State of Delaware
(or, if such court lacks subject matter jurisdiction, any appropriate state or
federal court in New Castle County in the State of Delaware) in the event any
dispute arises out of this Agreement or any of the transactions contemplated
hereby, (ii) shall not attempt to deny or defeat such personal jurisdiction by
motion or other request for leave from any such court, and (iii) shall not bring
any action relating to this Agreement or any of the transactions contemplated
hereby in any court other than the Court of Chancery in and for New Castle
County in the State of Delaware (or, if such court lacks subject matter
jurisdiction, any appropriate state or federal court in New Castle County in the
State of Delaware).
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<PAGE>
Section 6.10 SEVERABILITY. Whenever possible, each provision or portion
of any provision of this Agreement shall be interpreted in such manner as to be
effective and valid under applicable law but if any provision or portion of any
provision of this Agreement is held to be invalid, illegal or unenforceable in
any respect under any applicable law or rule in any jurisdiction, such
invalidity, illegality or unenforceability shall not affect any other provision
or portion of any provision in such jurisdiction, and this Agreement shall be
reformed, construed and enforced in such jurisdiction as if such invalid,
illegal or unenforceable provision or portion of any provision had never been
contained herein.
Section 6.11 COUNTERPARTS. This Agreement may be executed in one or
more counterparts, all of which shall be considered one and the same instrument
and shall become effective when one or more counterparts have been signed by
each party and delivered to the other parties.
Section 6.12 STOCKHOLDER CAPACITY. By executing this Agreement, no
person (including any officer, director, employee, partner, principal, agent or
affiliate of such person) who is or becomes during the term hereof a director,
officer, agent or financial advisor of Company makes any agreement or
understanding in his or her capacity as such officer, director, agent or
financial advisor. Each Stockholder signs solely in his or her capacity as the
record holder and beneficial owner, respectively, of the number of Subject
Shares set forth opposite his or her name on Schedule A hereto, respectively,
and nothing herein shall limit or affect any actions taken by a Stockholder in
his or her capacity as an officer, director, agent or financial advisor of
Company.
[signature page follows]
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<PAGE>
IN WITNESS WHEREOF, each of the parties hereto has caused this
Agreement to be signed as of the day and year first written above.
LOUISIANA-PACIFIC CORPORATION
By: /S/ MARK A. SUWYN
------------------------------------
Name: Mark A. Suwyn
Title: Chief Executive Officer
STRIPER ACQUISITION, INC.
By: /S/ MARK A. SUWYN
------------------------------------
Name: Mark A. Suwyn
Title: President
STOCKHOLDERS:
KOHLBERG ASSOCIATES, L.P.
By: KOHLBERG & KOHLBERG, L.L.C.
By: /S/ SAMUEL P. FRIEDER
------------------------------
Name: Samuel P. Frieder
Title: Vice President
KABT ACQUISITION COMPANY, L.P.
By: KOHLBERG ASSOCIATES, L.P.
By: KOHLBERG & KOHLBERG, L.L.C.
By: /S/ SAMUEL P. FRIEDER
------------------------
Name: Samuel P. Frieder
Title: Vice President
/S/ GEORGE T. BROPHY
---------------------------------------
GEORGE T. BROPHY
-11-
<PAGE>
SCHEDULE A
<TABLE>
<CAPTION>
TOTAL NUMBER OF SHARES
NAME AND ADDRESS OF STOCKHOLDER OF COMMON STOCK OWNED
<S> <C>
Kohlberg Associates, L.P. 7,820 Shares
c/o Kohlberg & Co.
111 Radio Circle
Mt. Kisco, NY 10549
KABT Acquisition Company, L.P. 4,899,776 Shares
c/o Kohlberg & Co.
111 Radio Circle
Mt. Kisco, NY 10549
George T. Brophy 44,958 Shares
1100 Beach Road, Apartment 3J 710,000 Options to
Vero Beach, Florida 32963 Purchase Shares
</TABLE>
A-1
