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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
----------------
SCHEDULE 14D-1
(Amendment No. 9)
TENDER OFFER STATEMENT PURSUANT TO SECTION 14(d)(1)
OF THE SECURITIES EXCHANGE ACT OF 1934
----------------
VARLEN CORPORATION
(Name of Subject Company)
AMSTED INDUSTRIES INCORPORATED
TRACK ACQUISITION INCORPORATED
(Bidders)
COMMON STOCK, PAR VALUE $.10 PER SHARE
(AND ASSOCIATED PREFERRED SHARE PURCHASE RIGHTS)
(Title of Class of Securities)
92224810
(CUSIP Number of Class of Securities)
Thomas C. Berg, Esq.
Track Acquisition Incorporated
c/o Amsted Industries Incorporated
44th Floor--Boulevard Towers South
205 North Michigan Avenue
Chicago, Illinois 60601
(312) 819-8470
(Name, Address and Telephone Number of Person Authorized to Receive
Notices and Communications on Behalf of Bidder)
----------------
Copies to:
Gary A. Goodman, Esq. Robert J. Minkus, Esq.
Terrence R. Brady, Esq. Schiff Hardin & Waite
Winston & Strawn 6600 Sears Tower
35 West Wacker Drive Chicago, Illinois 60606
Chicago, Illinois 60601 Telephone: (312) 258-5500
Telephone: (312) 558-5600
CALCULATION OF FILING FEE
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<TABLE>
<CAPTION>
Transaction Valuation* Amount of Filing Fee**
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<S> <C>
$750,999,774 $150,199.95
</TABLE>
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*For purposes of calculating the filing fee only. This amount assumes the
purchase in cash of 17,880,947 Shares (equal to (A) the sum of (i)
17,035,728 Shares issued and outstanding as of August 1, 1999, according to
Varlen Corporation (the "Company") plus (ii) 845,319 Shares subject to
issuance upon exercise of options for Shares, according to the Company, less
(B) 100 Shares beneficially owned by Track Acquisition Incorporated) at
$42.00 per Share.
**The fee, calculated in accordance with Rule 0-11(d) of the Securities
Exchange Act of 1934, is 1/50th of one percent of the aggregate Transaction
Valuation.
[X] 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 date of its filing.
Amount Previously Paid: $124,021.58
Form or Registration No.: 14D-1
Filing Party: Amsted Industries Incorporated
Date Filed: May 24, 1999
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<PAGE>
SCHEDULE 14D-1
This Amendment No. 9 amends and supplements the Tender Offer Statement on
Schedule 14D-1, as amended, originally filed on May 24, 1999 (the "Schedule
14D-1") by Amsted Industries Incorporated, a Delaware corporation ("Parent"),
and Track Acquisition Incorporated, a Delaware corporation and a wholly owned
subsidiary of Parent (the "Purchaser"), with respect to the Purchaser's offer
to purchase all outstanding shares of common stock, par value $.10 per share
(the "Common Stock"), of Varlen Corporation, a Delaware corporation (the
"Company"), including the associated preferred share purchase rights (the
"Rights") issued pursuant to the Rights Agreement, dated as of June 17, 1996,
as amended, between the Company and Harris Trust and Savings Bank, as Rights
Agent (the Common Stock and the Rights together are referred to herein as the
"Shares"), pursuant to the Offer to Purchase dated May 24, 1999 (the "Offer to
Purchase"), as amended and supplemented by the supplement thereto dated August
4, 1999 (the "Supplement"), and the related revised (green) Letter of
Transmittal (which, together with any amendments or supplements thereto,
collectively constitute the "Offer"), which are annexed to and filed with this
Amendment No. 9 as Exhibits (a)(22) and (a)(23), respectively. Unless
otherwise defined herein, all capitalized terms used herein shall have the
respective meanings given such terms in the Offer to Purchase.
Item 1. Security and Subject Company.
(b) Reference is hereby made to the information set forth in the
"Introduction" and Section 1 ("Amended Terms of the Offer; Expiration Date")
of the Supplement, which is incorporated herein by reference.
(c) Reference is hereby made to the information set forth in Section 2
("Price Range of Shares; Dividends") of the Supplement, which is incorporated
herein by reference.
Item 3. Past Contacts, Transactions or Negotiations with the Subject Company.
(a)-(b) Reference is hereby made to the information set forth in the
"Introduction," Section 1 ("Amended Terms of the Offer; Expiration Date"),
Section 4 ("Certain Information Concerning Parent and the Purchaser"), Section
5 ("Background of the Offer since July 9, 1999; Contacts with the Company"),
Section 6 ("Plans for the Company"), Section 7 ("The Merger Agreement") and
Section 8 ("Certain Conditions to the Offer") of the Supplement, which is
incorporated herein by reference.
Item 4. Source and Amount of Funds or Other Consideration.
(a)-(b) Reference is hereby made to the information set forth in Section 9
("Source and Amount of Funds") of the Supplement, which is incorporated herein
by reference.
Item 5. Purpose of the Tender Offer and Plans or Proposals of the Bidder.
(a)-(g) Reference is hereby made to the information set forth in the
"Introduction," Section 1 ("Amended Terms of the Offer; Expiration Date"),
Section 5 ("Background of the Offer since July 9, 1999; Contacts with the
Company"), Section 6 ("Plans for the Company"), Section 7 ("The Merger
Agreement") and Section 8 ("Certain Conditions to the Offer") of the
Supplement, which is incorporated herein by reference.
2
<PAGE>
Item 10. Additional Information.
(b)-(c) Reference is hereby made to the information set forth in Section 10
("Regulatory Compliance") of the Supplement, which is incorporated herein by
reference.
(f) Reference is hereby made to the entire text of the Supplement, which is
incorporated herein by reference.
Item 11. Material to be Filed as Exhibits.
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(a)(1) Offer to Purchase, dated May 24, 1999.*
(a)(2) Form of Letter of Transmittal.*
(a)(3) Form of letter, dated May 24, 1999, to brokers, dealers, commercial
banks, trust companies and other nominees.*
(a)(4) Form of letter to clients to be used by brokers, dealers, commercial
banks, trust companies and other nominees.*
(a)(5) Press Release, dated May 18, 1999.*
(a)(6) Press Release, dated May 24, 1999.*
(a)(7) Form of summary advertisement, dated May 24, 1999.*
(a)(8) Notice of Guaranteed Delivery.*
(a)(9) IRS Guidelines to Substitute Form W-9.*
(a)(10) Press Release, dated June 7, 1999.*
(a)(11) Form of letter dated June 11, 1999 from Morgan Stanley & Co.
Incorporated to Parent.*
(a)(12) Form of letter dated June 17, 1999 from Arthur W. Goetschel, Chairman,
President and Chief Executive Officer of Parent, to Raymond A. Jean,
President and Chief Executive Officer of the Company*
(a)(13) Press Release, dated June 18, 1999.*
(a)(14) Press Release, dated June 21, 1999.*
(a)(15) Press Release, dated June 22, 1999.*
(a)(16) Press Release, dated July 6, 1999.*
(a)(17) Confidentiality/Standstill Agreement, dated July 9, 1999, between
Parent and the Company.*
(a)(18) Press Release, dated July 20, 1999.*
(a)(19) Agreement and Plan of Merger, dated as of August 1, 1999, between
Parent and the Company.*
(a)(20) Joint press release issued by Parent and the Company, dated August 1,
1999, announcing the execution of the Merger Agreement and the
extension of the Expiration Date.*
(a)(21) Press Release, dated August 2, 1999.*
(a)(22) Supplement to Offer to Purchase dated August 4, 1999.
(a)(23) Revised Letter of Transmittal.
(a)(24) Revised Notice of Guaranteed Delivery.
(a)(25) Form of Second Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Nominees.
</TABLE>
3
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<TABLE>
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(a)(26) Form of Second Letter to Clients for Use by Brokers, Dealers,
Commercial Banks, Trust Companies and Nominees.
(b) Commitment Letter, dated April 29, 1999.*
(b)(2) Commitment Letter, dated July 30, 1999.
(c) None.
(d) None.
(e) Not Applicable.
(f) None.
</TABLE>
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*Previously filed.
4
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SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this statement is true, complete and correct.
Dated: August 4, 1999
Amsted Industries Incorporated
/s/ Thomas C. Berg
By: _________________________________
Name: Thomas C. Berg
Title: Vice President, General
Counsel and Secretary
Track Acquisition Incorporated
/s/ Thomas C. Berg
By: _________________________________
Name: Thomas C. Berg
Title: Vice President and
Secretary
5
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
Exhibit
Number Description
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<C> <S>
(a)(1) Offer to Purchase, dated May 24, 1999.*
(a)(2) Form of Letter of Transmittal.*
(a)(3) Form of letter, dated May 24, 1999, to brokers, dealers, commercial
banks, trust companies and other nominees.*
(a)(4) Form of letter to clients to be used by brokers, dealers, commercial
banks, trust companies and other nominees.*
(a)(5) Press Release, dated May 18, 1999.*
(a)(6) Press Release, dated May 24, 1999.*
(a)(7) Form of summary advertisement, dated May 24, 1999.*
(a)(8) Notice of Guaranteed Delivery.*
(a)(9) IRS Guidelines to Substitute Form W-9.*
(a)(10) Press Release, dated June 7, 1999.*
(a)(11) Form of letter dated June 11, 1999 from Morgan Stanley & Co.
Incorporated to Parent.*
(a)(12) Form of letter dated June 17, 1999 from Arthur W. Goetschel, Chairman,
President and Chief Executive Officer of Parent, to Raymond A. Jean,
President and Chief Executive Officer of the Company*
(a)(13) Press Release, dated June 18, 1999.*
(a)(14) Press Release, dated June 21, 1999.*
(a)(15) Press Release, dated June 22, 1999.*
(a)(16) Press Release, dated July 6, 1999.*
(a)(17) Confidentiality/Standstill Agreement, dated July 9, 1999, between
Parent and the Company.*
(a)(18) Press Release, dated July 20, 1999.*
(a)(19) Agreement and Plan of Merger, dated as of August 1, 1999, between
Parent and the Company.*
(a)(20) Joint press release issued by Parent and the Company, dated August 1,
1999, announcing the execution of the Merger Agreement and the
extension of the Expiration Date.*
(a)(21) Press Release, dated August 2, 1999.*
(a)(22) Supplement to Offer to Purchase dated August 4, 1999.
(a)(23) Revised Letter of Transmittal.
(a)(24) Revised Notice of Guaranteed Delivery.
(a)(25) Form of Second Letter to Brokers, Dealers, Commercial Banks, Trust
Companies and Nominees.
(a)(26) Form of Second Letter to Clients for Use by Brokers, Dealers,
Commercial Banks, Trust Companies and Nominees.
(b) Commitment Letter, dated April 29, 1999.*
(b)(2) Commitment Letter, dated July 30, 1999.
(c) None.
(d) None.
(e) Not Applicable.
(f) None.
</TABLE>
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* Previously filed.
6
<PAGE>
Exhibit (a)(22)
Supplement to Offer to Purchase Dated May 24, 1999
Track Acquisition Incorporated
a wholly owned subsidiary of
Amsted Industries Incorporated
Has Increased the Price of its
Offer to Purchase
All of the Shares of Common Stock
(Including the Associated Preferred Share Purchase Rights)
of
Varlen Corporation
to
$42.00 Net Per Share
THE EXPIRATION DATE OF THE OFFER HAS BEEN EXTEDED SUCH THAT THE OFFER AND
WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON
FRIDAY, AUGUST 13, 1999, UNLESS THE OFFER IS FURTHER EXTENDED.
THE BOARD OF DIRECTORS OF VARLEN CORPORATION ("THE COMPANY") HAS
UNANIMOUSLY DETERMINED THAT THE OFFER AND THE MERGER ARE EACH FAIR TO, AND IN
THE BEST INTERESTS OF, THE STOCKHOLDERS OF THE COMPANY, HAS APPROVED THE
MERGER AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING THE
OFFER AND THE MERGER, HAS DECLARED THAT THE MERGER AGREEMENT IS ADVISABLE AND
RECOMMENDS THAT STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR SHARES PURSUANT
TO THE OFFER.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY
TENDERED PRIOR TO THE EXPIRATION OF THE OFFER AND NOT WITHDRAWN A NUMBER OF
SHARES OF COMMON STOCK, PAR VALUE $.10 PER SHARE (INCLUDING THE ASSOCIATED
PREFERRED SHARE PURCHASE RIGHTS (THE "RIGHTS")) (COLLECTIVELY, THE "SHARES")
OF THE COMPANY WHICH, TOGETHER WITH THE SHARES BENEFICIALLY OWNED BY THE
PURCHASER AND ITS AFFILIATES, WILL CONSTITUTE AT LEAST A MAJORITY OF THE
OUTSTANDING SHARES AS OF THE DATE THE SHARES ARE ACCEPTED FOR PAYMENT PURSUANT
TO THE OFFER (THE "MINIMUM TENDER CONDITION"). THE OFFER IS ALSO SUBJECT TO
CERTAIN OTHER CONDITIONS DESCRIBED IN SECTION 8.
THE OFFER IS NOT CONDITIONED UPON PARENT OR THE PURCHASER OBTAINING
FINANCING.
The Dealer Manager for the Offer is:
SALOMON SMITH BARNEY
1
<PAGE>
IMPORTANT
Any stockholder desiring to tender all or any portion of such stockholder's
Shares should (1) complete and sign either the original (yellow) or the
revised (green) Letter of Transmittal or a facsimile thereof in accordance
with the instructions in the Letter of Transmittal, including any required
signature guarantees, and mail or deliver the Letter of Transmittal or such
facsimile with such stockholder's certificate(s) for the tendered Shares and
any other required documents to the Depositary (as defined herein), (2) follow
the procedure for book-entry tender of Shares set forth in Section 3 of the
Offer to Purchase or (3) request such stockholder's broker, dealer, commercial
bank, trust company or other nominee to effect the transaction for such
stockholder. Stockholders having Shares registered in the name of a broker,
dealer, commercial bank, trust company or other nominee must contact such
broker, dealer, commercial bank, trust company or other nominee if they desire
to tender Shares so registered. Unless the context requires otherwise, all
references to Shares herein shall include the associated Rights.
The Rights are presently evidenced by the certificates for the Common Stock
and a tender by a stockholder of such stockholder's shares of Common Stock
will also constitute a tender of the associated Rights. A stockholder who
desires to tender Shares and whose certificates for such Shares are not
immediately available, or who cannot comply with the procedure for book-entry
transfer on a timely basis, may tender such Shares by following the procedures
for guaranteed delivery set forth in Section 3 of the Offer to Purchase.
Questions and requests for assistance may be directed to the Information
Agent (as defined herein) or to the Dealer Manager (as defined herein) at
their respective addresses and telephone numbers set forth on the back cover
of this Supplement. Requests for additional copies of this Supplement, the
Offer to Purchase and the revised (green) Letter of Transmittal may be
directed to the Information Agent, the Dealer Manager or to brokers, dealers,
commercial banks or trust companies.
August 4, 1999
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Section Page
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<S> <C>
INTRODUCTION............ 1
1. Amended Terms of the
Offer; Expiration Date. 3
2. Price Range of
Shares; Dividends...... 3
3. Certain Information
Concerning the Company. 4
4. Certain Information
Concerning Parent and
the Purchaser.......... 6
5. Background of the
Offer since July 9,
1999; Contacts with the
Company................ 6
6. Plans for the
Company................ 7
7. The Merger
Agreement.............. 7
8. Certain Conditions
to the Offer........... 12
9. Source and Amount of
Funds.................. 13
10. Regulatory
Compliance............. 13
11. Miscellaneous....... 13
</TABLE>
i
<PAGE>
To the Holders of Shares of Varlen Corporation:
INTRODUCTION
The following information amends and supplements the Offer to Purchase,
dated May 24, 1999 (the "Offer to Purchase") of Track Acquisition
Incorporated, a Delaware corporation (the "Purchaser") and a wholly owned
subsidiary of Amsted Industries Incorporated, a Delaware corporation
("Parent"). Pursuant to this Supplement, the Purchaser is now offering to
purchase all of the outstanding shares of common stock, par value $.10 per
share (the "Common Stock"), of Varlen Corporation, a Delaware corporation (the
"Company"), including the associated preferred share purchase rights (the
"Rights") issued pursuant to the Rights Agreement, dated as of June 17, 1996,
as amended (the "Rights Agreement"), between the Company and Harris Trust and
Savings Bank, as Rights Agent (the Common Stock and the Rights together are
referred to herein as the "Shares"), at $42.00 per Share, net to the seller in
cash, upon the terms and subject to the conditions set forth in the Offer to
Purchase and in the related revised (green) Letter of Transmittal (which,
together with any amendments or supplements hereto or thereto, collectively
constitute the "Offer"). Tendering stockholders who have Shares registered in
their own name and who tender directly to the Depositary (as defined herein)
will not be obligated to pay brokerage fees or commissions or, subject to
Instruction 6 of the Letter of Transmittal, transfer taxes on the purchase of
Shares by the Purchaser pursuant to the Offer. Stockholders who hold their
Shares through their broker or bank should consult with such institution as to
whether there are any fees applicable to a tender of Shares. The Purchaser
will pay all charges and expenses of Citibank, N.A., as depositary (the
"Depositary"), Salomon Smith Barney Inc. ("Salomon Smith Barney"), as dealer
manager (the "Dealer Manager"), and Innisfree M&A Incorporated, as information
agent (the "Information Agent"). Unless the context requires otherwise, all
references to Shares herein shall include the associated Rights, and all
references to the Rights shall include all benefits that may inure to the
holders of the Rights pursuant to the Rights Agreement.
Except as otherwise set forth in this Supplement and in the revised (green)
Letter of Transmittal, the terms and conditions previously set forth in the
Offer to Purchase and the related original (yellow) Letter of Transmittal
remain applicable in all respects to the Offer, and this Supplement should be
read in conjunction with the Offer to Purchase. Unless the context otherwise
requires, capitalized terms used but not defined herein have the meanings
ascribed to them in the Offer to Purchase.
Procedures for tendering Shares are set forth in Section 3 of the Offer to
Purchase. Tendering stockholders may continue to use the original (yellow)
Letter of Transmittal and the original (blue) Notice of Guaranteed Delivery
previously circulated with the Offer to Purchase, or they may use the revised
(green) Letter of Transmittal and the revised (grey) Notice of Guaranteed
Delivery circulated with this Supplement. While the Letter of Transmittal
previously circulated with the Offer to Purchase refers only to the Offer to
Purchase, stockholders using such document to tender their Shares will
nevertheless be deemed to be tendering pursuant to the amended Offer
(including the amendments and supplements made by this Supplement) and will
receive the increased Offer price per Share described in this Supplement if
Shares are accepted for payment and paid for by the Purchaser pursuant to the
Offer.
SHARES PREVIOUSLY VALIDLY TENDERED AND NOT WITHDRAWN CONSTITUTE VALID
TENDERS FOR PURPOSES OF THE OFFER. STOCKHOLDERS ARE NOT REQUIRED TO TAKE ANY
FURTHER ACTION WITH RESPECT TO SUCH SHARES IN ORDER TO RECEIVE THE INCREASED
OFFER PRICE OF $42.00 PER SHARE IF SHARES ARE ACCEPTED FOR PAYMENT AND PAID
FOR BY THE PURCHASER PURSUANT TO THE OFFER, EXCEPT AS MAY BE REQUIRED BY THE
GUARANTEED DELIVERY PROCEDURE IF SUCH PROCEDURE WAS UTILIZED. SEE SECTION 4 OF
THE OFFER TO PURCHASE FOR THE PROCEDURES FOR WITHDRAWING SHARES TENDERED
PURSUANT TO THE OFFER.
The Company, Parent and the Purchaser have entered into an Agreement and
Plan of Merger, dated as of August 1, 1999 (the "Merger Agreement"), which
provides for, among other things, (i) an increase in the price
<PAGE>
per Share to be paid pursuant to the Offer from $35.00 per Share to $42.00 per
Share, net to the seller in cash, (ii) the amendment and restatement of the
conditions to the Offer as set forth in their entirety in Section 8 of this
Supplement, (iii) the extension of the Offer such that the Offer and
withdrawal rights will expire at 12:00 midnight, New York City time, on
Friday, August 13, 1999 and (iv) the merger of the Purchaser with and into the
Company (the "Merger") as promptly as is practicable following the
consummation of the Offer. In the Merger, each Share issued and outstanding
immediately prior to the Merger (other than any Shares held in the treasury of
the Company, by Parent, the Purchaser or any subsidiary of Parent or the
Purchaser, or by any wholly owned subsidiary of the Company and other than any
Dissenting Shares (as such term is defined in the Merger Agreement)) shall be
converted into the right to receive $42.00 in cash, payable to the holder
thereof, without interest thereon, upon surrender of the certificate formerly
representing such Share.
THE BOARD OF DIRECTORS OF THE COMPANY (THE "BOARD") HAS UNANIMOUSLY
DETERMINED THAT THE OFFER AND THE MERGER ARE EACH FAIR TO, AND IN THE BEST
INTERESTS OF, THE STOCKHOLDERS OF THE COMPANY, HAS APPROVED THE MERGER
AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREIN, INCLUDING THE OFFER AND
THE MERGER, HAS DECLARED THAT THE MERGER AGREEMENT IS ADVISABLE AND RECOMMENDS
THAT STOCKHOLDERS ACCEPT THE OFFER AND TENDER THEIR SHARES PURSUANT TO THE
OFFER.
Pursuant to the Merger Agreement, the Company has represented that it has
taken all necessary action to cause the dilution provisions of the Rights
Agreement to be inapplicable to the transactions contemplated by the Merger
Agreement, without any payment to holders of the Rights issued pursuant to the
Rights Agreement. In addition, the Company has amended the Rights Agreement to
provide that neither Parent nor any of its "affiliates" or "associates" (each
as defined in the Rights Agreement) (including the Purchaser) will be deemed
an Acquiring Person (as defined in the Rights Agreement) and that the
Distribution Date (as defined in the Rights Agreement) will not be deemed to
occur, and that the Rights will not separate from the Shares, as a result of
the entering into the Merger Agreement, the commencement of the Offer or the
consummation of the Merger.
The Company has advised Parent and the Purchaser that, to the best of the
Company's knowledge, each member of the Board and each of the Company's
executive officers intends to tender all Shares owned by such persons pursuant
to the Offer.
The Company's financial advisor, Morgan Stanley & Co. Incorporated ("Morgan
Stanley"), has delivered to the Board a written opinion dated August 1, 1999
to the effect that, as of such date and based upon and subject to certain
matters stated in its opinion, the $42.00 per Share consideration to be
received in the Offer and the Merger by holders of Shares (other than Parent
and its affiliates) pursuant to the Merger Agreement is fair, from a financial
point of view, to such holders. Such opinion is set forth in full as an annex
to the Amendment No. 3 to Schedule 14D-9, included herewith, and should be
read carefully in its entirety.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THE MINIMUM TENDER
CONDITION. CERTAIN OTHER TERMS AND CONDITIONS TO THE CONSUMMATION OF THE OFFER
ARE DESCRIBED IN SECTION 8 OF THIS SUPPLEMENT.
On July 30, 1999, there were outstanding approximately 17,035,728 Shares
according to the Company, and, as of such date, 100 Shares were beneficially
owned by the Purchaser and its affiliates. As a result, the Minimum Tender
Condition would be satisfied if at least 8,517,815 Shares were validly
tendered and not withdrawn prior to the Expiration Date.
THIS SUPPLEMENT, THE OFFER TO PURCHASE AND THE RELATED REVISED (GREEN)
LETTER OF TRANSMITTAL CONTAIN IMPORTANT INFORMATION WHICH SHOULD BE READ
CAREFULLY BEFORE ANY DECISION IS MADE WITH RESPECT TO THE OFFER.
2
<PAGE>
THE TENDER OFFER
1. Amended Terms of the Offer; Expiration Date.
Pursuant to the Merger Agreement, the Purchaser has agreed to amend the
Offer. The price per Share to be paid pursuant to the Offer has been increased
from $35.00 per Share to $42.00 per Share, net to the seller in cash, upon the
terms and subject to the conditions of the Offer. All stockholders whose
Shares are validly tendered and not withdrawn and accepted for payment
pursuant to the Offer (including Shares tendered and not withdrawn prior to
the date of this Supplement) will receive the increased price.
The Company has amended the Rights Agreement to provide that neither Parent
nor any of Parent's "affiliates" or "associates", including the Purchaser,
will be deemed an Acquiring Person and that the Distribution Date will not be
deemed to occur, and that the Rights will not separate from the shares of
Common Stock, as a result of the entering into the Merger Agreement, the
commencement of the Offer or the consummation of the Merger.
Pursuant to the Merger Agreement, the Offer has been amended such that the
Offer will expire at 12:00 midnight, New York City time, on Friday, August 13,
1999, unless and until the Purchaser, subject to the provisions of the Merger
Agreement, shall have extended the period during which the Offer is open. The
term "Expiration Date" shall mean 12:00 midnight, New York City time, on
Friday, August 13, 1999 or any later time and date at which the Offer, as so
extended by the Purchaser, shall expire. As of the close of business on August
3, 1999, approximately 155,907 Shares had been tendered and not withdrawn
pursuant to the Offer. See Section 7 of this Supplement for a description of
the provisions of the Merger Agreement regarding extensions of the Offer by
the Purchaser.
The Offer is conditioned upon satisfaction of the Minimum Tender Condition
described above in the Introduction and each of the conditions described in
Section 8 of this Supplement. The Purchaser reserves the right (but shall not
be obligated), subject to the provisions of the Merger Agreement, to waive any
or all of such conditions.
The Company has agreed to provide the Purchaser with the Company's
stockholder list and security position listings for the purpose of
disseminating the Offer to holders of Shares. This Supplement, the revised
(green) Letter of Transmittal and other relevant materials will be mailed to
record holders of Shares whose names appear on the Company's stockholder list
and will be furnished to brokers, dealers, commercial banks, trust companies
and similar persons whose names, or the names of whose nominees, appear on the
Company's stockholder list or who are listed as participants in a clearing
agency's security position listing for subsequent transmittal to beneficial
owners of Shares by the Purchaser following receipt of such lists from the
Company.
2. Price Range of Shares; Dividends.
The reported high and low closing bid quotations for the Shares on the
Nasdaq Stock Market's National Market (the "Nasdaq National Market") during
the second quarter of the year ending December 31, 1999 were 40 1/8 and $25
13/16, respectively. On July 30, 1999, the last full day of trading prior to
the announcement of the execution of the Merger Agreement, the reported
closing bid price per Share reported on the Nasdaq National Market was $39
7/8. The reported closing bid quotations on the first two days of the third
quarter, August 2 and 3, for the shares on the Nasdaq National Market were 41
3/4. STOCKHOLDERS ARE URGED TO OBTAIN A CURRENT MARKET QUOTATION FOR THE
SHARES.
3
<PAGE>
See Section 7 of this Supplement for a discussion of certain limitations
contained in the Merger Agreement on the ability of the Company to declare and
pay dividends.
3. Certain Information Concerning the Company.
The information concerning the Company contained in this Supplement has
been taken from or based upon publicly available documents and records on file
with the SEC and other public sources and is qualified in its entirety by
reference thereto. None of Parent, the Purchaser, the Information Agent or the
Dealer Manager can take responsibility for the accuracy or completeness of the
information contained in such documents and records, or for any failure by the
Company to disclose events which may have occurred or may affect the
significance or accuracy of any such information but which are unknown to
Parent, the Purchaser, the Information Agent or the Dealer Manager.
The Company is a Delaware corporation with its principal executive offices
located at 55 Shuman Boulevard, P.O. Box 3089, Naperville, Illinois 60566-
7089, and its telephone number is (630) 420-0400. The following description of
the Company's business has been taken from, and is qualified in its entirety
by reference to, the Company's Annual Report on Form 10-K for the fiscal year
ended January 31, 1999 (the "Company 10-K").
The Company was founded in 1969 and designs, manufactures and markets
products used in the manufacturing of components for locomotives, railcars and
track fasteners in its Railroad Products segment and components for
automobiles, light and heavy duty trucks in its Vehicular Products segment.
The selected financial information of the Company and its consolidated
subsidiaries set forth below has been excerpted and derived from the Company
10-K and the Company's Quarterly Report on Form 10-Q for the three months
ended May 1, 1999. More comprehensive financial and other information is
included in such report (including management's discussion and analysis of
financial condition and results of operations) and in other reports and
documents filed by the Company with the SEC. The financial information set
forth below is qualified in its entirety by reference to such reports and
documents filed with the SEC and the financial statements and related notes
contained therein. These reports and other documents may be examined and
copies thereof may be obtained in the manner set forth below.
VARLEN CORPORATION
AND SUBSIDIARIES
Selected Consolidated Financial Information
<TABLE>
<CAPTION>
Fiscal Year Ended January
31,
----------------------------
1999 1998 1997
-------- -------- --------
(in thousands)
<S> <C> <C> <C>
Statement of Earnings Data:
Net sales......................................... $646,672 $522,254 $409,475
Gross profit...................................... 168,737 129,670 100,448
Selling, general and administrative expenses...... 90,763 74,887 63,607
Earnings from operations.......................... 77,974 54,783 36,841
Interest expense.................................. (7,309) (9,536) (9,402)
Interest income................................... 812 234 662
Gain on sale of business.......................... -- -- 3,730
Net earnings...................................... $ 41,242 $ 25,651 $ 17,857
Balance Sheet Data (at year end):
Current assets.................................... $178,403 $150,167
Total assets...................................... 475,524 419,101
Current liabilities............................... 103,609 76,143
Long-term debt.................................... 94,643 104,715
Stockholder's equity.............................. $240,920 $198,792
</TABLE>
4
<PAGE>
<TABLE>
<CAPTION>
Three Months Ended
--------------------------
May 1, 1999 May 2, 1998
-------------- -----------
(unaudited)
(in thousands)
<S> <C> <C>
Statement of Earnings Data:
Net sales............................................ $193,277 $164,615
Gross profit......................................... 50,568 43,343
Selling, general and administrative expenses......... 24,355 22,276
Interest expense..................................... 1,389 1,706
Earnings before income taxes......................... 24,824 19,361
Net earnings......................................... $ 14,522 $ 11,036
<CAPTION>
May 1, 1999
--------------
(unaudited)
(in thousands)
<S> <C> <C>
Balance Sheet Data:
Current assets....................................... $188,910
Total assets......................................... 488,087
Current liabilities.................................. 107,100
Long-term debt....................................... 91,599
Stockholder's equity................................. $252,814
</TABLE>
Available Information. The Company is subject to the information and
reporting requirements of the Exchange Act and in accordance therewith is
required to file periodic reports, proxy statements and other information with
the SEC relating to its business, financial condition and other matters.
Certain information, as of particular dates, concerning the Company's
business, principal physical properties, capital structure, material pending
legal proceedings, operating results, financial condition, directors and
officers (including their remuneration and the stock options granted to them),
the principal holders of the Company's securities, any material interests of
such persons in transactions with the Company and certain other matters is
required to be disclosed in proxy statements and annual reports distributed to
the Company's stockholders and filed with the SEC. Such reports, proxy
statements and other information can be inspected and copied at the public
reference facilities maintained by the SEC at Judiciary Plaza, 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the SEC's regional offices at 500
West Madison Street, Chicago, Illinois 60606, and 7 World Trade Center, New
York, New York 10048. Copies of such material can also be obtained at
prescribed rates from the Public Reference Section of the SEC at its principal
office at Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549.
Such material may be obtained electronically by visiting the SEC's website on
the Internet, at http://www.sec.gov.
Certain Financial Projections. The Company does not as a matter of course
make public forecasts or projections as to its future financial performance.
However, in connection with the negotiations between Parent and the Company,
the Company made available to representatives of Parent certain non-public
information (the "Projections") regarding the Company's projected operating
performance. The Projections indicated that from February 1, 1999 to January
31, 2002 the Company's revenues would increase at a compound annual growth
rate of approximately 8.7% and the Company's earnings would increase at a
compound annual growth rate of approximately 16.5%.
The Projections were prepared by the Company for internal purposes and not
with a view to publication or dissemination to the public. The Projections
were not prepared in accordance with published guidelines of the American
Institute of Certified Public Accountants or the SEC regarding projections and
forecasts, nor have the Projections been audited, examined or otherwise
reviewed by independent auditors of the Company. The Projections necessarily
make numerous assumptions with respect to the Company's performance, general
business and economic conditions and other matters, many of which are beyond
the Company's control and are inherently uncertain. No assurance can be given
that the Projections will be accurate, and actual future performance may be
materially different than the Projections. Inclusion of the Projections should
not be regarded as a representation by the Company, Parent, the Purchaser, or
any other person that the Projections will prove to be correct. The
Projections are included solely because they were provided by the Company to
Parent and the Purchaser.
5
<PAGE>
4. Certain Information Concerning Parent and the Purchaser.
Parent is a Delaware corporation whose principal executive offices are
located at 44th Floor--Boulevard Towers South, 205 North Michigan Avenue,
Chicago, Illinois 60601.
Parent is composed of six decentralized entities whose products fall into
three product categories: railroad, construction and building, and general
industrial. Railroad products are manufactured by American Steel Foundries and
Griffin Wheel and include components for railroad freight cars and
locomotives, such as side frames and bolsters, wheels and coupling products.
Construction and building products are manufactured by two of Parent's
entities: Griffin Pipe produces ductile iron pressure pipe and fittings for
fresh water and waste water transmission, and Baltimore Aircoil produces
evaporative heat transfer and ice thermal storage equipment used in air
conditioning applications for large buildings. General industrial products are
manufactured by four of Parent's entities: American Steel Foundries, Baltimore
Aircoil, Burgess-Norton and Diamond Chain. This category includes products for
the automotive and truck industry, such as fifth wheels, piston pins and
powder metal parts; evaporative heat transfer equipment for industrial cooling
applications; and roller chain for a variety of applications. In May 1999,
Parent sold its Macwhyte Company division, which produces wire rope for
industrial applications.
The Purchaser's principal executive offices are located care of Amsted
Industries Incorporated, 44th Floor- Boulevard Towers South, 205 North
Michigan Avenue, Chicago, Illinois 60601. The Purchaser is a newly formed
Delaware corporation and a wholly owned subsidiary of Parent. The Purchaser
has not conducted any business other than in connection with the Offer and the
Merger.
Additional Information. As a privately-held company, Parent is not subject
to the information and reporting requirements of the Exchange Act and is not
required to file reports and other information with the SEC relating to its
business, financial condition and other matters.
5. Background of the Offer since July 9, 1999; Contacts with the Company.
On July 9, 1999, Parent and the Company entered into a
Confidentiality/Standstill Agreement, pursuant to which the Company agreed
that it would provide to Parent and its affiliates access to the Company's
senior management and certain non-public information concerning the Company
and its affairs.
On July 13, 1999, certain officers and members of management of the Company
made a presentation to Parent concerning the business and operations of the
Company. On July 16 and 17, 1999, representatives of Parent met with
representatives of the Company to conduct due diligence investigations of the
Company's business. Follow-up diligence investigations continued through the
week of July 26, 1999.
On July 23, 1999, Morgan Stanley sent a letter to third parties, including
Parent, inviting the submission of an offer to acquire all of the Company's
Shares pursuant to the enclosed form of merger agreement and setting July 30,
1999 as the deadline for submitting such offers.
On July 30, 1999, Parent submitted its $42.00 per Share offer together with
Parent's proposed changes to the form of merger agreement circulated by Morgan
Stanley.
Beginning on July 31, 1999, and continuing through August 1, 1999, Winston
& Strawn and Schiff Hardin & Waite, as counsel for Parent, and Kirkland &
Ellis and Richards, Layton & Finger, as counsel to the Company, negotiated the
terms of a definitive merger agreement. The Board unanimously approved the
Merger Agreement at a special meeting of the Board held on August 1, 1999.
Parent, the Purchaser and the Company executed the Merger Agreement on August
1, 1999.
6
<PAGE>
6. Plans for the Company.
Pursuant to the Merger Agreement, Parent, the Purchaser and the Company
have agreed, among other things, to modify the composition of the Board to
include designees of Parent following consummation of the Offer and to make
certain changes to the Company's Certificate of Incorporation and Bylaws at
the time of the Merger (the "Effective Time").
7. The Merger Agreement.
The following is a summary of the Merger Agreement, a copy of which is
attached as Exhibit (a)(19) to Amendment No. 8 to Parent's and the Purchaser's
Schedule 14D-1 filed with the SEC with respect to the Offer. Such summary is
qualified in its entirety by reference to the text of the Merger Agreement.
The Amended Offer. Pursuant to the Merger Agreement, Parent and the
Purchaser have agreed, subject to certain conditions, to amend the Offer (i)
to increase the price per Share to be paid pursuant to the Offer from $35.00
per Share to $42.00 per Share, net to the seller in cash, (ii) to amend and
restate the conditions to the Offer as set forth in their entirety in Section
8 of this Supplement, (iii) to amend the Offer such that the Offer and
withdrawal rights will expire at 12:00 midnight, New York City time, on
Friday, August 13, 1999 and (iv) to provide for the Merger as promptly as is
practicable following the consummation of the Offer.
Parent and the Purchaser have also agreed that they will not, without the
prior written consent of the Company, decrease the price per Share or change
the form of consideration payable in the Offer, decrease the number of Shares
sought in the Offer, amend or waive satisfaction of the Minimum Tender
Condition, change or impose additional conditions to the Offer or amend any
other term of the Offer in any manner adverse to the holders of Shares or
extend the Offer (other than as set forth in the next paragraph). The
Purchaser further agreed that, upon the terms and subject to the conditions of
the Offer, the Purchaser will accept for payment and will purchase, as soon as
permitted under the terms of the Offer, all Shares validly tendered and not
withdrawn prior to the expiration of the Offer.
Parent and the Purchaser also agreed that they will not extend the
Expiration Date unless at the Expiration Date the conditions to the Offer
described in Annex I of the Merger Agreement (as set forth in their entirety
in Section 8 of this Supplement) shall not have been satisfied or earlier
waived. If at the Expiration Date, such conditions shall not have been
satisfied or earlier waived, Purchaser may extend the Expiration Date for an
additional period of up to 10 business days. The Purchaser may also extend the
Offer on up to two occasions for up to 10 business days each in the event that
(i) the conditions to the Offer shall have been satisfied or waived at the
Expiration Date and (ii) the number of Shares tendered and not withdrawn
represent more than 50% but less than 90% of the issued and outstanding
Shares.
Company Actions. Pursuant to the Merger Agreement, the Company has
consented to the Offer and represented that the Board unanimously (i) approved
the Merger Agreement, the Offer and the Merger and (ii) resolved to recommend
acceptance of the Offer and adoption and approval of the Merger Agreement and
the Merger by the stockholders of the Company.
The Company also has agreed that it shall file with the SEC an amendment to
the Schedule 14D-9 with respect to the Offer (together with any amendments or
supplements thereto, the "Amended Schedule 14D-9") which amendment shall
include, subject to the next sentence, the recommendation described in the
preceding paragraph. Subject to the provisions of the Merger Agreement
described under "Termination" below, such recommendation may be withdrawn,
modified or amended to the extent that the Board deems it necessary to do so
in the exercise of its fiduciary duty.
Pursuant to the Merger Agreement, promptly upon the purchase of and payment
for any Shares by the Purchaser which represent at least a majority of the
outstanding Shares, Parent will be entitled to designate members of the Board
such that Parent will have a number of representatives on the Board, rounded
up to the next whole number, equal to the product of (x) the total number of
directors on the Board multiplied by (y) the percentage of the outstanding
Shares owned by the Purchaser; provided, however, that until the Effective
Time, there shall be at least three directors who were directors as of the
date of the Merger Agreement. The Company will, upon request by Parent,
increase the size of the Board and, if necessary, secure the resignations of
such number of directors as is necessary to enable Parent's designees to be
elected to the Board and will cause Parent's designees to be so elected.
7
<PAGE>
Following the election or appointment of Parent's designees and prior to
the Effective Time, the affirmative vote of a majority of the then serving
directors of the Company who were directors as of the date of the Merger
Agreement shall be required to amend or terminate the Merger Agreement,
exercise or waive any of the Company's rights, benefits or remedies under the
Merger Agreement, amend the certificate of incorporation or bylaws of the
Company or take any other action of the Board (other than the calling of a
special meeting of the stockholders of the Company to approve and adopt the
Merger Agreement) under or in connection with the Merger Agreement.
The Merger. The Merger Agreement provides that in accordance with the
provisions thereof, at the Effective Time, the Purchaser will be merged with
and into the Company, and the Company will be the surviving corporation in the
Merger (hereinafter sometimes called the "Surviving Corporation") and will
continue to be governed by the laws of the State of Delaware. At the Effective
Time, the separate corporate existence of the Purchaser shall cease.
Pursuant to the Merger Agreement, at the Effective Time, by virtue of the
Merger and without any action on the part of the holders of the Shares or the
shares of the capital stock of the Purchaser, each Share issued and
outstanding immediately prior to the Effective Time (other than any Shares
owned by the Company or by Parent, the Purchaser or any subsidiary of either
of them or Shares which are held by dissenting stockholders exercising
appraisal rights in accordance with the DGCL) will be converted into the right
to receive $42.00 in cash, without interest. For a description of certain
appraisal rights available to stockholders under Delaware law in connection
with the Merger, see Section 11 of the Offer to Purchase.
At the Effective Time, by virtue of the Merger and without any action on
the part of the holders of the Shares or the shares of the capital stock of
the Purchaser, each share of capital stock of the Purchaser issued and
outstanding immediately prior to the Effective Time will be converted into one
share of capital stock of the Surviving Corporation.
Under the Merger Agreement, the Company has agreed, at or prior to the
Effective Time, to use its best efforts to cause each holder of each employee
option or right to acquire Shares and each stock appreciation right
outstanding to be exercised or, if not exercised, to be canceled immediately
prior to the Effective Time in consideration of the payment to such holder of
an amount in cash equal to the product of (A) the number of Shares subject to
such option or stock appreciation right and (B) the excess, if any, of $42.00
over the exercise price per Share.
The Merger Agreement provides that the certificate of incorporation of the
Surviving Corporation shall be amended to read in its entirety as the
certificate of incorporation of the Purchaser reads as in effect immediately
prior to the Effective Time until thereafter amended, provided that such
certificate of incorporation shall be amended to reflect "Varlen Corporation"
as the name of the Surviving Corporation.
Under the Merger Agreement, the bylaws of the Purchaser at the Effective
Time shall be the bylaws of the Surviving Corporation until thereafter changed
or amended. Under the Merger Agreement, the directors of the Purchaser at the
Effective Time will be the initial directors of the Surviving Corporation and
will hold office until their respective successors are duly elected or
qualified or until their earlier resignation or removal. Pursuant to the
Merger Agreement, the officers of the Company at the Effective Time will be
the initial officers of the Surviving Corporation and will hold office until
their respective successors are duly elected or qualified or until their
earlier resignation or removal.
Agreements of the Company, Parent and the Purchaser. Pursuant to the Merger
Agreement, if required by applicable law in order to consummate the Merger,
the Company shall, as soon as practicable following the acquisition by the
Purchaser of the Shares pursuant to the Offer, duly call, give notice of,
convene and hold a meeting of its stockholders (the "Company Stockholders
Meeting") for the purpose of obtaining the requisite number of votes to
approve and adopt the Merger Agreement, and the Company shall, through the
Board, recommend to its stockholders that they vote in favor of the approval
and adoption of the Merger Agreement; provided, however, that the Board may
withdraw, modify or change such recommendation to the extent that the Board
determines to do so in exercise of its fiduciary duties. The Merger Agreement
provides that Parent shall vote or cause to be voted all Shares owned of
record by Parent, the Purchaser or any of their affiliates in favor of the
approval and adoption of the Merger Agreement.
8
<PAGE>
The Merger Agreement provides that, if required by applicable law, as soon
as practicable following Parent's request, the Company and Parent shall
prepare and file with the SEC the proxy statement relating to the Company
Stockholders Meeting. Each of the Company and Parent shall use its reasonable
efforts to cause the Company's proxy statement to be mailed to the Company's
stockholders, as promptly as practicable.
Notwithstanding the preceding paragraph or any other provision of the
Merger Agreement, the Merger Agreement provides that in the event that Parent
or the Purchaser shall own at least 90% of the Shares, the Company shall not
be required to call the Company Stockholders Meeting or to file or mail a
proxy statement, and the parties to the Merger Agreement shall, at the request
of Parent, take all necessary action to cause the Merger to become effective
as soon as practicable after the acceptance for payment of and payment for
Shares by the Purchaser pursuant to the Offer without a meeting of
stockholders of the Company.
In the Merger Agreement, the Company has covenanted and agreed that, except
for certain exceptions, during the period from the date of the Merger
Agreement to the Effective Time, among other things, (A) each of the Company
and its material subsidiaries will conduct its business in the ordinary course
in all material respects, (B) the Company will use its reasonable best efforts
to preserve its business organizations intact, to keep available the services
of its and its material subsidiaries' current officers, employees and
consultants and to preserve its and its material subsidiaries' relationships
with customers, suppliers and other person with which it or any of its
subsidiaries has significant business relations and (C) neither the Company
nor any of its material subsidiaries will (i) amend the certificate of
incorporation or bylaws of the Company, (ii) issue or sell any share of
capital stock of the Company or any of its or its material Subsidiaries'
assets, (iii) declare, set aside or pay any dividend with respect to its
capital stock (other than regular quarterly dividends not to exceed $.05 per
share), (iv) make any acquisitions in excess of $10 million in the aggregate
or (v) incur certain indebtedness other than in the ordinary course of
business.
Pursuant to the Merger Agreement, the Company shall not take or cause,
directly or indirectly, any of the following actions with any party other than
Parent, the Purchaser or their respective designees: (i) solicit, knowingly
encourage, initiate or participate in any negotiations, inquiries or
discussions with respect to any offer, indication or proposal to acquire all
or substantially all of its business, assets or capital shares whether by
merger, consolidation, other business combination, purchase of assets or
shares, tender or exchange offer or otherwise (each of the foregoing, an
"Acquisition Proposal"), (ii) disclose, in connection with an Acquisition
Proposal, any information or provide access to its properties, books or
records, except as required by law or pursuant to a governmental request for
information or (iii) agree to, or enter into any agreement with respect to,
any Acquisition Proposal.
Notwithstanding anything to the contrary contained in the previous
paragraph, the Merger Agreement provides that prior to the Effective Time, the
Company may participate in discussions or negotiations with, and furnish non-
public information and afford access to the properties, books, records,
officers, employees and representatives of the Company to any Person, entity
or group if such Person, entity or group has delivered to the Company, prior
to the date of the Company Stockholders Meeting, and in writing, an
Acquisition Proposal which the Board in its good faith reasonable judgment
determines if consummated would be more favorable, from a financial point of
view, to the Company's stockholders than the transactions contemplated by the
Merger Agreement, which determination may be made only after the Board
determines, upon the advice of its legal counsel, that the Board would breach
its fiduciary duties if it did not accept the Acquisition Proposal (a
"Superior Proposal"). Pursuant to the Merger Agreement, in the event the
Company receives a Superior Proposal the Board could execute and enter into an
agreement relating to such Superior Proposal and recommend such Superior
Proposal to its stockholders, if the Board determines that its fiduciary
duties require it to do so; in such case, the Board agrees that it may
withdraw, modify or refrain from making its recommendation of the Merger;
provided, however, that the Company shall (i) promptly, and in any event
within 24 hours, notify Parent if any such Acquisition Proposal is received
by, any such information is requested from, or any such negotiations or
discussions are sought to be initiated or continued with, the Company or any
of its subsidiaries, indicating, in connection with such notice, the name of
such person and the material terms of any such Acquisition Proposal, (ii)
provide Parent at least 24 hours prior written notice of the Company's
intention to execute or enter into an agreement relating to such Superior
Proposal and (iii) terminate the Merger Agreement by written notice to Parent
provided no sooner than 48 hours after Parent's receipt of a copy of such
Superior Proposal (or a description of the significant terms and conditions
thereof).
9
<PAGE>
Pursuant to the Merger Agreement, the Company has agreed to afford Parent's
officers, employees, counsel, accountants, financial advisors, auditors and
other representatives reasonable access to its and its Subsidiaries' offices,
properties, books, contracts, records and representatives and, during such
period, will furnish promptly all information concerning its business,
properties and personnel as may be reasonably requested.
Under the Merger Agreement, before issuing any press release or otherwise
making any public announcements with respect to the Merger and the
transactions contemplated by the Merger Agreement, Parent and the Company will
consult with each other.
Under the Merger Agreement, for a period of six years after the Effective
Time, Parent and the Surviving Corporation shall indemnify the current and
former officers and directors of the Company.
Pursuant to the Merger Agreement, for a period of six years after the
Effective Time, each of Parent and Surviving Corporation has agreed that it
shall maintain the Company's existing directors' and officers' liability
insurance policy (provided that Parent may substitute therefor policies of
substantially similar coverage and amounts containing terms which are no less
advantageous); provided, however, that Parent is not obligated to make annual
premium payments for such insurance to the extent such premiums exceed 150% of
the premiums paid as of the date of the Merger Agreement by the Company for
such insurance.
Pursuant to the Merger Agreement, Parent has agreed that, for the period of
one year commencing on the consummation of the Offer, the employees of the
Company and its subsidiaries will continue to be provided with employee
benefits comparable in the aggregate to those currently provided by the
Company and its Subsidiaries to such employees.
Rights Agreement. In the Merger Agreement, the Company has represented that
it has taken all necessary action to cause the dilution provisions of the
Rights Agreement to be inapplicable to the transactions contemplated by the
Merger Agreement, without any payment to holders of the Rights issued pursuant
to the Rights Agreement. In addition, the Company has amended the Rights
Agreement to provide that neither Parent nor any of its "affiliates" or
"associates" (including the Purchaser) will be deemed an Acquiring Person and
that the Distribution Date will not be deemed to occur, and that the Rights
will not separate from the Shares, as a result of the entering into the Merger
Agreement, the commencement of the Offer or the consummation of the Merger.
Representations and Warranties. The Merger Agreement contains certain
representations and warranties by the Company, including representations and
warranties concerning: the organization, good standing and qualification of
the Company and its material subsidiaries; the capital structure of the
Company; the corporate authority of the Company relative to the execution and
delivery of and consummation of the transactions contemplated by the Merger
Agreement; the absence of any violations of the corporate documents and
certain instruments of the Company or its material subsidiaries or of any
statute, rule, regulation, order or decree, subject to certain exceptions; the
accuracy and timelines of filing of reports and documents filed by the Company
with the SEC; certain litigation and environmental matters; and the absence
since May 1, 1999 to the date of the Merger Agreement of any adverse change in
the financial condition of the Company and it material Subsidiaries taken as a
whole which would constitute a Company Material Adverse Effect (as defined in
the Merger Agreement).
The Merger Agreement also contains certain representations and warranties
by Parent and the Purchaser, including that the Purchaser has available
sufficient funds to consummate the Offer and the Merger and the transactions
contemplated thereby.
Conditions to the Merger. The conditions to the Offer are set forth in
Section 8 ("Certain Conditions to the Offer"). The Company's, Parent's and the
Purchaser's obligations to effectuate the Merger are subject to the
satisfaction or waiver on or prior to the Effective Time of the following
conditions:
(a) the Merger Agreement shall have been approved and adopted by the
stockholders of the Company in accordance with Delaware law (except that
this condition shall be deemed satisfied if Parent and/or the Purchaser
shall have acquired 90% or more of the outstanding Shares);
10
<PAGE>
(b) no governmental entity or federal or state court of competent
jurisdiction shall have enacted, issued or enforced any statute,
regulation, decree, injunction or other order which prohibits the
consummation of the Merger;
(c) with respect to the obligations of Parent and the Purchaser, each of
the representations and warranties of the Company contained in the Merger
Agreement shall be true and correct as of the Effective Time as though made
on and as of the Effective Time;
(d) with respect to the obligations of the Company, each of the
representations and warranties of Parent contained in the Merger Agreement
shall be true and correct as of the Effective Time, as though made on and
as of the Effective Time; and
(e) the Purchaser shall have (i) amended the Offer pursuant to the
Merger Agreement and (ii) purchased, pursuant to the terms and conditions
of such Offer, all Shares duly tendered and not withdrawn; provided,
however, that neither Parent nor the Purchaser shall be entitled to rely on
the condition in clause (ii) above if either of them shall have failed to
purchase Shares pursuant to the Offer in breach of their obligations under
the Merger Agreement.
Termination. The Merger Agreement may be terminated at any time prior to
the Effective Time (notwithstanding any approval of the Merger Agreement by
the stockholders of the Company):
(a) by mutual written consent of the Company and Parent;
(b) by either Parent or the Company, if any permanent injunction or
action by any governmental entity preventing the consummation of the Merger
shall have become final and nonappealable;
(c) by either Parent or the Company, if the Merger shall not have been
consummated before November 30, 1999; provided, however, that the right to
terminate the Merger Agreement under this subparagraph shall not be
available to any party whose failure to fulfill an obligation or condition
under the Merger Agreement has been the cause of, or resulted in, the
failure of the Merger to occur on or before such date and shall not be
available to Parent if it has purchased Shares pursuant to the Offer;
(d) by the Company, if the Purchaser shall have failed to amend the
Offer within the three business day period specified in the Merger
Agreement or if Parent or the Purchaser terminates or withdraws the Offer
without purchasing Shares thereunder or the Offer shall have expired
without the purchase of the Shares thereunder;
(e) by either Parent or the Company, if the Merger shall fail to receive
the requisite vote for approval and adoption by the stockholders of the
Company at the Company Stockholders Meeting;
(f) by the Company, if the Board determines to accept a Superior
Proposal;
(g) by Parent, prior to the purchase by the Purchaser of Shares pursuant
to the Offer, if (i) the Board shall have withdrawn or adversely modified
its recommendation of the Offer, the Merger or the Merger Agreement (it
being understood, however, that for all purposes of the Merger Agreement,
the fact that the Company has supplied any person with information
regarding the Company or has entered into discussions or negotiations with
such person as permitted by the Merger Agreement, or the disclosure of such
facts, shall not be deemed a withdrawal or modification of the Board's
recommendation of the Offer, the Merger or the Merger Agreement); (ii) the
Board shall have recommended to the stockholders of the Company that they
approve an Acquisition Proposal other than transactions contemplated by the
Merger Agreement; or (iii) a tender offer or exchange offer that, if
successful, would result in any person or "group" becoming a "beneficial
owner" (such terms having the meaning in the Merger Agreement as is
ascribed under Regulation 13D under the Exchange Act) of 15% or more of the
outstanding Shares is commenced (other than by Parent or an affiliate of
Parent) and the Board recommends that the stockholders of the Company
tender their Shares in such tender or exchange offer; or
(h) by Parent or the Company, if the Offer terminates or expires on
account of the failure of any condition specified in Annex I to the Merger
Agreement without the Purchaser having purchased any Shares thereunder
(provided that the right to terminate the Merger Agreement pursuant to this
subparagraph shall not be available to any party whose failure to fulfill
any obligation under the Merger Agreement has been the cause of, or
resulted in, the failure of any such condition).
11
<PAGE>
In the event that either (A) the Merger Agreement is terminated for the
reasons described in subparagraphs (f) or (g) above or (B)(i) the Offer shall
have remained open for a minimum of at least 10 business days from the date
that it is amended pursuant to the Merger Agreement, (ii) after the date of
the Merger Agreement any corporation, partnership, person, other entity or
group (as defined in Section 13(d)(3) of the Exchange Act) other than Parent
or any of its affiliates shall have become the beneficial owner of 15% or more
of the outstanding Shares or made any Acquisition Proposal, (iii) the Minimum
Tender Condition shall not have been satisfied and the Offer is terminated
pursuant to subparagraph (c) above and the Purchaser shall not have accepted
for payment any Shares pursuant to the Offer and (iv) within twelve months of
such termination the Company enters into an agreement providing for the
consummation of an Acquisition Proposal or any other person or other entity
(other than Parent or any of its affiliates) becomes the beneficial owner of
40% or more of the outstanding Shares, then, in each such case, the Company
shall pay Parent in cash $25,000,000.
Amendment. Any provision of the Merger Agreement may be amended or waived
prior to the Effective Time if, and only if, such amendment or waiver is in
writing and signed, in the case of an amendment, by the Company, Parent and
the Purchaser or in the case of a waiver, by the party against whom the waiver
is to be effective; provided that after the adoption of the Merger Agreement
by the stockholders of the Company, no such amendment or waiver shall, without
the further approval of such stockholders, alter or change (i) the amount or
kind of consideration to be received in exchange for any shares of capital
stock of the Company, (ii) any term of the certificate of incorporation of the
Surviving Corporation or (iii) any of the terms or conditions of the Merger
Agreement if such alteration or change would adversely affect the holders of
any shares of capital stock of the Company.
The capitalized terms used but not otherwise defined in this Section 7
shall have the meanings set forth in the Merger Agreement.
8. Certain Conditions to the Offer.
Pursuant to the Merger Agreement, the conditions of the Offer are amended
and restated in their entirety as follows:
Notwithstanding any other provision of the Offer, the Purchaser shall
not be required to accept for payment or pay for any Shares if (i) prior to
the expiration date of the Offer, the Minimum Tender Condition shall not
have been satisfied or (ii) prior to the acceptance for payment of or
payment for Shares and at any time on or after the date of the Merger
Agreement, any of the following conditions shall have occurred and be
continuing:
(a) Any governmental entity or federal or state court of competent
jurisdiction shall have enacted, issued or enforced any statute,
regulation, decree, injunction or other order (whether temporary,
preliminary or permanent) which is in effect and which prohibits
consummation of the Offer, the Merger or any transaction contemplated
by the Merger Agreement; provided that Parent shall have used its
commercially reasonable efforts to cause any such decree, judgment,
injunction or other order to be vacated or lifted; or
(b) The Merger Agreement shall have been terminated in accordance
with its terms; or
(c) There shall have occurred an event or condition which has a
Company Material Adverse Effect; or
(d) There shall have occurred, and continued to exist, (1) any
general suspension of, or limitation on prices for, trading in
securities on the NASDAQ National Market or the New York Stock Exchange
or (2) a declaration of a banking moratorium or any suspension of
payments in respect of banks in the United States, or a material
limitation (whether or not mandatory) by any governmental entity on the
extension of credit by banks or other lending institutions.
12
<PAGE>
9. Source and Amount of Funds.
The Purchaser estimates that the total amount of funds required to purchase
all of the outstanding Shares (other than those already owned by the
Purchaser) on a fully diluted basis pursuant to the Offer and the Merger and
to pay related fees and expenses will be approximately $779 million (taking
into account any proceeds to be received by the Company upon the exercise of
options). The Purchaser will obtain these funds from Parent in the form of a
capital contribution or loan. Parent will obtain the necessary funds from its
internal cash reserves and borrowings under the Credit Agreement described in
the Offer to Purchase. On July 30, 1999, Parent entered into an amended and
restated Commitment Letter which increased the aggregate amount of the Credit
Facilities to $1 billion. The amended and restated Commitment Letter has been
filed as an exhibit to the Tender Offer Statement on Schedule 14D-1 and
incorporated herein by reference.
10. Regulatory Compliance.
On June 8, 1999, the waiting period under the HSR Act expired with respect
to the acquisition of Shares pursuant to the Offer and the Merger.
11. Miscellaneous.
The Offer is not being made to (nor will tenders be accepted from or on
behalf of) holders of Shares in any jurisdiction in which the making of the
Offer or the acceptance thereof would not be in compliance with the laws of
such jurisdiction. However, the Purchaser may, in its sole discretion, take
such action as it may deem necessary to make the Offer in any such
jurisdiction and extend the Offer to holders of Shares in such jurisdiction.
Neither Parent nor the Purchaser is aware of any jurisdiction in which the
making of the Offer or the acceptance of Shares in connection therewith would
not be in compliance with the laws of such jurisdiction.
Parent and the Purchaser have filed with the SEC a Statement on Schedule
l4D-1 pursuant to Rule l4d-3 of the General Rules and Regulations under the
Exchange Act and have filed amendments and may file additional amendments
thereto furnishing certain additional information with respect to the Offer.
Such Statement and any amendments thereto, including exhibits, may be examined
and copies may be obtained from the SEC in the manner set forth in Section 8
of the Offer to Purchase.
EXCEPT AS OTHERWISE SET FORTH IN THIS SUPPLEMENT AND IN THE REVISED (GREEN)
LETTER OF TRANSMITTAL, THE TERMS AND CONDITIONS PREVIOUSLY SET FORTH IN THE
OFFER TO PURCHASE REMAIN APPLICABLE IN ALL RESPECTS TO THE OFFER, AND THIS
SUPPLEMENT SHOULD BE READ IN CONJUNCTION WITH THE OFFER TO PURCHASE.
No person has been authorized to give any information or make any
representation on behalf of Parent or the Purchaser not contained in this
Supplement, the Offer to Purchase or in the revised (green) Letter of
Transmittal and, if given or made, such information or representation must not
be relied upon as having been authorized.
Neither the delivery of this Supplement or the Offer to Purchase nor any
purchase pursuant to the Offer shall, under any circumstances, create any
implication that there has been no change in the affairs of Parent, the
Purchaser, the Company or any of their respective subsidiaries since the date
as of which information is furnished or the date of this Supplement.
TRACK ACQUISITION INCORPORATED
August 4, 1999
13
<PAGE>
Manually signed facsimile copies of the Letter of Transmittal will be
accepted. The Letter of Transmittal, certificates for Shares and any other
required documents should be sent or delivered by each stockholder of the
Company or such stockholder's broker, dealer, commercial bank, trust company
or other nominee to the Depositary at one of its addresses set forth below.
The Depositary for the Offer is:
CITIBANK, N.A.
By Hand: By Mail: By Overnight Courier:
Citibank, N.A. Citibank, N.A. Citibank, N.A.
Corporate Trust Window P.O. Box 685 915 Broadway, 5th Floor
111 Wall Street, 5th Old Chelsea Station New York, New York 10010
Floor New York, New York 10113
New York, New York 10043
Facsimile For Eligible Institutions: (212) 505-2248
To Confirm Facsimile Only: (800) 270-0808
Questions and requests for assistance or for additional copies of the
Supplement, the Offer to Purchase and the related Letter of Transmittal, and
other tender offer materials, may be directed to the Information Agent or the
Dealer Manager at their respective telephone numbers and locations listed
below. Stockholders may also contact their broker, dealer, commercial bank,
trust company or other nominee for assistance concerning the Offer.
The Information Agent for the Offer is:
INNISFREE M&A INCORPORATED
501 Madison Avenue, 20th Floor
New York, New York 10022
Banks and Brokers Call Collect (212) 750-5833
All Others Call Toll Free (888) 750-5834
The Dealer Manager for the Offer is:
SALOMON SMITH BARNEY
Seven World Trade Center
New York, New York 10048
<PAGE>
Exhibit (a)(23)
Letter of Transmittal
to Tender Shares of Common Stock
(Including the Associated Preferred Share Purchase Rights)
of
Varlen Corporation
at
$42.00 Net Per Share
by
Track Acquisition Incorporated
a wholly owned subsidiary of
Amsted Industries Incorporated
THE EXPIRATION DATE OF THE OFFER HAS BEEN EXTENDED SUCH THAT THE OFFER AND
WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON
FRIDAY, AUGUST 13, 1999, UNLESS THE OFFER IS FURTHER EXTENDED.
The Depositary for the Offer is:
CITIBANK, N.A.
By Hand: By Mail: By Overnight Courier:
Citibank, N.A. Citibank, N.A. Citibank, N.A.
Corporate Trust Window P.O. Box 685 915 Broadway, 5th
111 Wall Street, 5th Old Chelsea Station Floor
Floor New York, New York New York, New York
New York, New York 10113 10010
10043
Facsimile For Eligible Institutions: (212) 505-2248
To Confirm Facsimile Only: (800) 270-0808
DELIVERY OF THIS REVISED LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS ACCOMPANYING THIS REVISED LETTER OF TRANSMITTAL SHOULD BE
READ CAREFULLY BEFORE THIS REVISED LETTER OF TRANSMITTAL IS COMPLETED.
This revised Letter of Transmittal or the original (yellow) Letter of
Transmittal previously circulated is to be used either if certificates are to
be forwarded herewith or, unless an Agent's Message (as defined in Section 3
of the Offer to Purchase (as defined below)) is utilized, if delivery is to be
made by book-entry transfer to the Depositary's account at The Depository
Trust Company (the "Book-Entry Transfer Facility"), pursuant to the procedures
set forth in Section 3 of the Offer to Purchase. Stockholders who deliver
Shares by book-entry transfer are referred to herein as "Book-Entry
Stockholders" and other stockholders are referred to herein as "Certificate
Stockholders." Stockholders whose certificates for Shares are not immediately
available or who cannot comply with the procedure for book-entry transfer on a
timely basis, or who cannot deliver all required documents to the Depositary
prior to the Expiration Date (as defined in the Supplement dated August 4,
1999 to the offer to Purchase (the "Supplement")), may tender their Shares in
accordance with the guaranteed delivery procedure set forth in Section 3 of
the Offer to Purchase. See Instruction 2. DELIVERY OF DOCUMENTS TO THE BOOK-
ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
The Company has amended the Rights Agreement to provide that neither Parent
nor any of Parent's "affiliates" or "associates", including the Purchaser,
will be deemed an Acquiring Person and that the Distribution Date will not be
deemed to occur, and that the Rights will not separate from the shares of
Common Stock, as a result of the entering into the Merger Agreement, the
commencement of the Offer or the consummation of the Merger.
<PAGE>
DESCRIPTION OF SHARES TENDERED
- - -------------------------------------------------------------------------------
<TABLE>
<CAPTION>
<S> <C>
Shares
Tendered
Name(s) and Address(es) of Registered Owner(s) (Attach
(Please fill additional
in if blank, exactly as name(s) appear(s) on list if
certificate(s)) necessary)
</TABLE>
<TABLE>
- - -----------------------------------------------------------------------------------------------
<CAPTION>
<S> <C> <C> <C>
Share Total Number Number of
Certificate of Shares Shares
Number(s)* Represented by Tendered**
Share
Certificate*
-------------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
-------------------------------------------------------
Total Shares:
- - -----------------------------------------------------------------------------------------------
</TABLE>
* Need not be completed by Book-Entry Stockholders.
** Unless otherwise indicated, it will be assumed that all Shares described
above are being tendered. See Instruction 4.
[_] CHECK HERE IF CERTIFICATE HAS BEEN LOST OR MUTILATED. SEE SECTION 11.
[_] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
MADE TO THE ACCOUNT MAINTAINED BY THE DEPOSITARY WITH A BOOK-ENTRY TRANSFER
FACILITY AND COMPLETE THE FOLLOWING (ONLY FINANCIAL INSTITUTIONS THAT ARE
PARTICIPANTS IN THE SYSTEM OF ANY BOOK-ENTRY TRANSFER FACILITY MAY DELIVER
SHARES BY BOOK-ENTRY TRANSFER):
Name of Tendering Institution _______________________________________________
If delivered by book-entry transfer, check box: [_]
Account Number ______________________________________________________________
Transaction Code Number _____________________________________________________
[_] CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY, ENCLOSE A PHOTOCOPY
OF SUCH NOTICE OF GUARANTEED DELIVERY AND COMPLETE THE FOLLOWING:
Name(s) of Registered Owner(s) ________________________________________________
Date of Execution of Notice of Guaranteed Delivery ____________________________
Name of Institution which Guaranteed Delivery _________________________________
If delivered by book-entry transfer, check box: [_]
Account Number ________________________________________________________________
Transaction Code Number _______________________________________________________
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
2
<PAGE>
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
Ladies and Gentlemen:
The undersigned hereby tenders to Track Acquisition Incorporated, a
Delaware corporation (the "Purchaser") and a wholly owned subsidiary of Amsted
Industries Incorporated, a Delaware corporation ("Parent"), the above-
described shares, par value $.10 per share (the "Common Stock"), including the
associated preferred share purchase rights (the "Rights" and, together with
the Common Stock, the "Shares"), of Varlen Corporation, a Delaware corporation
(the "Company"), pursuant to the Offer to Purchase, dated May 24, 1999, as
amended and supplemented by the Supplement (the "Offer to Purchase"), all of
the outstanding Shares at a price of $42.00 per Share, net to the seller in
cash, upon the terms and subject to the conditions set forth in the Offer to
Purchase, receipt of which is hereby acknowledged, and in this revised Letter
of Transmittal (which, together with the Offer to Purchase, constitute the
"Offer"). The undersigned understands that the Purchaser reserves the right to
transfer or assign, from time to time, in whole or in part, to one or more of
its affiliates, the right to purchase the Shares tendered herewith.
On the terms and subject to the conditions of the Offer (including the
conditions set forth in Section 13 of the Offer to Purchase and, if the Offer
is extended or amended, the terms and conditions of such extension or
amendment), subject to, and effective upon, acceptance for payment of, and
payment for, the Shares tendered herewith in accordance with the terms of the
Offer, the undersigned hereby sells, assigns and transfers to, or upon the
order of, the Purchaser, all right, title and interest in and to all of the
Shares being tendered hereby and any and all cash dividends, distributions,
rights, other Shares or other securities issued or issuable in respect of such
Shares on or after May 24, 1999 (collectively, the "Distributions"), and
appoints Citibank, N.A. (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 the fullest
extent of such stockholder's rights with respect to such Shares (and any
Distributions) (a) to deliver such Share Certificates (as defined herein) (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 either such case with all accompanying evidences of
transfer and authenticity, to or upon the order of the Purchaser, (b) to
present such Shares (and any Distributions) for transfer on the books of the
Company and (c) to receive all benefits and otherwise exercise all rights of
beneficial ownership of such Shares (and any Distributions), all in accordance
with the terms and the conditions of the Offer.
The undersigned hereby irrevocably appoints the designees of the Purchaser,
and each of them, the attorneys-in-fact and proxies of the undersigned, each
with full power of substitution, to the full extent of such stockholder's
rights with respect to the Shares tendered hereby which have been accepted for
payment by the Purchaser and with respect to any Distributions. The designees
of the Purchaser will, with respect to the Shares (and any associated
Distributions) for which the appointment is effective, be empowered to
exercise all voting and any other rights of such stockholder, as they, in
their sole discretion, may deem proper at any annual, special or adjourned
meeting of the Company's stockholders, by written consent in lieu of any such
meeting or otherwise. This proxy and power of attorney shall be irrevocable
and coupled with an interest in the tendered Shares. Such appointment is
effective when, and only to the extent that, the Purchaser deposits the
payment for such Shares with the Depositary. Upon the effectiveness of such
appointment, without further action, all prior powers of attorney, proxies and
consents given by the undersigned with respect to such Shares (and any
associated Distributions) will be revoked, and no subsequent powers of
attorney, proxies, consents or revocations may be given (and, if given, will
not be deemed effective). The Purchaser reserves the right to require that, in
order for Shares to be deemed validly tendered, immediately upon the
Purchaser's payment for such Shares, the Purchaser must be able to exercise
full voting rights with respect to such Shares (and any associated
Distributions), including voting at any meeting of stockholders.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Shares (and
any Distributions) tendered hereby and, when the same are accepted for payment
by the Purchaser, the Purchaser will acquire good, marketable and unencumbered
title thereto, free and clear of all liens, restrictions, charges and
encumbrances, and the same will not be subject to any adverse claim. The
undersigned will, upon request, execute and deliver any additional documents
deemed by the Depositary or the Purchaser to be necessary or desirable to
complete the sale, assignment and transfer of the Shares (and any
Distributions) tendered hereby. In addition, the undersigned shall promptly
remit and transfer to the Depositary for the account of the Purchaser any and
all Distributions in respect of the Shares tendered hereby, accompanied by
appropriate documentation of transfer; and, pending such remittance or
3
<PAGE>
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 or value thereof,
as determined by the Purchaser in its sole discretion.
All authority conferred or agreed to be conferred pursuant to this revised
Letter of Transmittal shall not be affected by, and shall survive, the death or
incapacity of the undersigned and any obligation of the undersigned hereunder
shall be binding upon the heirs, personal representatives, successors and
assigns of the undersigned. Except as stated in the Offer to Purchase, this
tender is irrevocable.
The undersigned understands that the valid tender of Shares pursuant to one
of the procedures described in Section 3 of the Offer to Purchase, as amended
and supplemented by the Supplement and the Instructions hereto, will constitute
a binding agreement between the undersigned and the Purchaser upon the terms
and subject to the conditions of the Offer. The undersigned recognizes that
under certain circumstances set forth in the Offer to Purchase, Purchaser may
not be required to accept for payment any of the Shares tendered hereby.
Unless otherwise indicated herein under "Special Payment Instructions,"
please issue the check for the purchase price and return any certificates for
Shares not tendered or accepted for payment in the name(s) of the registered
owner(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 for Shares not
tendered or accepted for payment (and accompanying documents, as appropriate)
to the address(es) of the registered owner(s) appearing under "Description of
Shares Tendered." In the event that both the Special Delivery Instructions and
the Special Payment Instructions are completed, please issue the check for the
purchase price and issue any certificates for Shares not tendered or accepted
for payment (and any accompanying documents, as appropriate) in the name of,
and deliver such check and return such certificates (and any accompanying
documents, as appropriate) to, the person or persons so indicated. The
undersigned recognizes that the Purchaser has no obligation pursuant to the
Special Payment Instructions to transfer any Shares from the name of the
registered owner thereof if the Purchaser does not accept for payment any of
the Shares so tendered.
SPECIAL PAYMENT INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(See Instructions 1, 5, 6 and 7) (See Instructions 5 and 7)
To be completed ONLY if To be completed ONLY if
certificate(s) for Shares not certificate(s) for Shares not
tendered or not accepted for tendered or not accepted for
payment and the check for the payment and the check for the
purchase price of Shares accepted purchase price of Shares accepted
for payment are to be issued in the for payment are to be sent to
name of someone other than the someone other than the undersigned,
undersigned. or to the undersigned at an address
other than that above.
Issue: [_] Check [_] Certificate(s)
to: Deliver: [_] Check [_] Certificate(s)
to:
Name: ______________________________
(Please Print) Name: ______________________________
(Please Print)
Address: ___________________________
------------------------------------ Address: ___________________________
(Include Zip Code) ------------------------------------
------------------------------------ (Include Zip Code)
(Tax Identification or Social
Security No.)
4
<PAGE>
IMPORTANT
SIGN HERE
(Also Complete Substitute Form W-9 Below)
(Signature(s) of Holder(s))
- - --------------------------------------------------------------------------------
- - --------------------------------------------------------------------------------
Dated , 1999
(Must be signed by registered owner(s) exactly as name(s) appear(s) on stock
certificate(s) or on a security position listing or by person(s) authorized to
become registered owner(s) by certificates and documents transmitted herewith.
If signature is by trustees, executors, administrators, guardians, attorneys-
in-fact, officers of corporations or others acting in a fiduciary or
representative capacity, please set forth full title and see Instruction 5.)
(Please Type or Print)
Name(s) ________________________________________________________________________
- - --------------------------------------------------------------------------------
Address ________________________________________________________________________
- - --------------------------------------------------------------------------------
(Include Zip Code)
Capacity (Full Title) __________________________________________________________
Area Code and Telephone Number _________________________________________________
Tax Identification or Social Security Number ___________________________________
Guarantee of Signature(s)
(See Instructions 1 and 5)
Authorized Signature ___________________________________________________________
Name ___________________________________________________________________________
Address ________________________________________________________________________
- - --------------------------------------------------------------------------------
(Include Zip Code)
Full Title and Name of Firm ____________________________________________________
Dated , 1999
5
<PAGE>
INSTRUCTIONS
Forming Part of the Terms and Conditions of the Offer
1. Guarantee of Signatures. Except as otherwise provided below, all
signatures on this revised Letter of Transmittal must be guaranteed by a
financial institution (including most commercial banks, savings and loan
associations and brokerage houses) which is a participant in the Securities
Transfer Agents Medallion Program or an "eligible guarantor institution," as
such term is defined in Rule 17Ad-15 under the Securities Exchange Act of
1934, as amended (an "Eligible Institution"). Signatures on this revised
Letter of Transmittal need not be guaranteed (a) if this revised Letter of
Transmittal is signed by the registered owners (which term, for purposes of
this document, includes any participant in the Book-Entry Transfer Facility's
system whose name appears on a security position listing as the owner of the
Shares) of Shares tendered herewith and such registered owner has not
completed the box entitled "Special Payment Instructions" or the box entitled
"Special Delivery Instructions" on this revised Letter of Transmittal or (b)
if such Shares are tendered for the account of an Eligible Institution. See
Instruction 5 of this revised Letter of Transmittal.
2. Delivery of Revised Letter of Transmittal and Certificates or Book-Entry
Confirmations. This revised Letter of Transmittal or the original (yellow)
Letter of Transmittal is to be used either if certificates are to be forwarded
herewith or if tenders are to be made pursuant to the procedures for tender by
book-entry transfer set forth in Section 3 of the Offer to Purchase.
Certificates for all physically tendered Shares ("Share Certificates"), or
confirmation of any book-entry transfer into the Depositary's account at the
Book-Entry Transfer Facility of Shares tendered by book-entry transfer, as
well as this revised Letter of Transmittal properly completed and duly
executed with any required signature guarantees, and any other documents
required by this revised Letter of Transmittal, must be received by the
Depositary at one of its addresses set forth herein on or prior to the
Expiration Date (as defined in the Offer to Purchase).
Stockholders whose certificates for Shares are not immediately available or
who cannot deliver all other required documents to the Depositary on or prior
to the Expiration Date or who cannot comply with the procedures for book-entry
transfer on a timely basis may nevertheless tender their Shares by properly
completing and duly executing a Notice of Guaranteed Delivery pursuant to the
guaranteed delivery procedure set forth in Section 3 of the Offer to Purchase.
Pursuant to such procedure: (i) such tender must be made by or through an
Eligible Institution; (ii) a properly completed and duly executed Notice of
Guaranteed Delivery substantially in the form provided by the Purchaser must
be received by the Depositary prior to the Expiration Date; and (iii) Share
Certificates or confirmation of any book-entry transfer into the Depositary's
account at a Depository Institution of Shares tendered by book-entry transfer,
as well as a Letter of Transmittal, 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 this revised Letter
of Transmittal, must be received by the Depositary within three Nasdaq
National Market trading days after the date of execution of such Notice of
Guaranteed Delivery.
The Company has amended the Rights Agreement to provide that neither Parent
nor any of Parent's "affiliates" or "associates", including the Purchaser,
will be deemed an Acquiring Person and that the Distribution Date will not be
deemed to occur, and that the Rights will not separate from the shares of
Common Stock, as a result of the entering into the Merger Agreement, the
commencement of the Offer or the consummation of the Merger.
If Share Certificates are forwarded separately to the Depositary, a
properly completed and duly executed Letter of Transmittal must accompany each
such delivery.
The method of delivery of Share Certificates and all other required
documents, including delivery through any Book-Entry Transfer Facility, is at
the election and risk of the tendering stockholder. The delivery will be
deemed made only when actually received by the Depositary (including, in the
case of a Book-Entry Transfer, by Book-Entry confirmation). If such delivery
is by mail, it is recommended that such certificates and documents be sent by
registered mail, properly insured, with return receipt requested. 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 revised Letter of Transmittal (or facsimile thereof), waive any right
to receive any notice of the acceptance of their Shares for payment.
6
<PAGE>
3. Inadequate Space. If the space provided herein is inadequate, the
certificate numbers and the number of Shares should be listed on a separate
schedule attached hereto.
4. Partial Tenders (Applicable to Certificate Stockholders Only). If fewer
than all the Shares evidenced by any certificate submitted are to be tendered,
fill in the number of Shares which are to be tendered in the box entitled
"Number of Shares Tendered." In such cases, new certificate(s) for the
remainder of the Shares that were evidenced by the old certificate(s) will be
sent to the registered owner, unless otherwise provided in the appropriate box
on this revised Letter of Transmittal, as soon as practicable after the
Expiration Date. All Shares represented by certificates delivered to the
Depositary will be deemed to have been tendered unless otherwise indicated.
5. Signatures on Letter of Transmittal; Stock Powers and Endorsements. If
this revised Letter of Transmittal is signed by the registered owners of the
Shares tendered hereby, the signature must correspond with the names as
written on the face of the certificates without alteration, enlargement or any
other change whatsoever.
If any of the Shares tendered hereby are owned of record by two or more
joint owners, all such owners must sign this revised 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 revised Letter of Transmittal or any certificates or stock powers
are signed by trustees, executors, administrators, guardians, attorneys-in-
fact, officers of corporations or others acting in a fiduciary or
representative capacity, such persons should so indicate when signing, and
proper evidence satisfactory to the Parent of their authority so to act must
be submitted.
If this revised Letter of Transmittal is signed by the registered owner(s)
of the Shares listed and transmitted hereby, no endorsements of certificates
or separate stock powers are required unless payment is to be made to, or
certificates for Shares not tendered or accepted for payment are to be issued
in the name of, a person other than the registered owner(s). Signatures on
such certificates or stock powers must be guaranteed by an Eligible
Institution.
If this revised Letter of Transmittal is signed by a person other than the
registered owner of the certificates(s) listed, the certificate(s) must be
endorsed or accompanied by the appropriate stock powers, in either case signed
exactly as the name or names of the registered owner or holders appears on the
certificate(s). Signatures on such certificates or stock powers must be
guaranteed by an Eligible Institution.
6. Stock Transfer Taxes. The Purchaser will pay any stock 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
accepted for payment are to be registered in the name of, any person other
than the registered owner, or if tendered certificates are registered in the
name of any person other than the person(s) signing this revised Letter of
Transmittal, the amount of any stock transfer taxes (whether imposed on the
registered owner or such person) payable on account of the transfer to such
person will be deducted from the purchase price if satisfactory evidence of
the payment of such taxes, or exemption therefrom, is not submitted.
EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY FOR
TRANSFER TAX STAMPS TO BE AFFIXED TO THE CERTIFICATES LISTED IN THIS REVISED
LETTER OF TRANSMITTAL.
7. Special Payment and Delivery Instructions. If a check is to be issued in
the name of, and certificates for Shares not tendered or accepted for payment
are to be issued or returned to, a person other than the signer of this
revised Letter of Transmittal or if a check and such certificates are to be
mailed to a person other than the signer of this revised Letter of Transmittal
or to an address other than that shown above, the appropriate boxes on this
revised Letter of Transmittal should be completed.
8. Requests for Assistance or Additional Copies. Questions and requests for
assistance or for additional copies of the Offer to Purchase, the Supplement,
the Letter of Transmittal and the Notice of Guaranteed Delivery, may be
directed to the
7
<PAGE>
Information Agent or the Dealer Manager at their respective telephone numbers
and locations set forth below. You may also contact your broker, dealer,
commercial bank, trust company or other nominee for assistance concerning the
Offer.
9. Substitute Form W-9. Each tendering stockholder is required to provide
the Depositary with a correct Taxpayer Identification Number ("TIN"),
generally the stockholder's social security or federal employer identification
number, on Substitute Form W-9 below. Failure to provide the information on
the form may subject the tendering stockholder to 31% federal income tax
backup withholding on the payment of the purchase price. The box in Part 3 of
the form may be checked if the tendering stockholder has not been issued a TIN
and has applied for a TIN or intends to apply for a TIN in the near future. If
the box in Part 3 is checked and the Depositary is not provided with a TIN
within 60 days, the Depositary will withhold 31% of all payments of the
purchase price thereafter until a TIN is provided to the Depositary.
10. Waiver of Conditions. The conditions of the Offer may be waived by the
Purchaser (subject to certain limitations), in whole or in part, at any time
or from time to time, in the Purchaser's sole discretion.
11. Lost or Destroyed Certificates. If any Certificate(s) representing
Shares has been lost or destroyed, the holders should promptly notify the
Company's Transfer Agent. The holders will then be instructed as to the
procedure to be followed in order to replace the Certificate(s). This revised
Letter of Transmittal and related documents cannot be processed until the
procedures for replacing lost or destroyed Certificates have been followed.
IMPORTANT: THIS REVISED LETTER OF TRANSMITTAL OR AN ORIGINAL (YELLOW)
LETTER OF TRANSMITTAL OR A MANUALLY SIGNED FACSIMILE THEREOF (TOGETHER WITH
SHARE CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER AND ALL OTHER
REQUIRED DOCUMENTS) OR THE NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY
THE DEPOSITARY PRIOR TO THE EXPIRATION DATE.
Important Tax Information
Under the federal income tax law, a stockholder whose tendered Shares are
accepted for purchase is required by law to provide the Depositary (as payer)
with such stockholder's correct TIN on Substitute Form W-9 below and to
certify that such TIN is correct (or that such stockholder is awaiting a TIN)
or otherwise establish a basis for exemption from backup withholding. If such
stockholder is an individual, the TIN is his or her social security number. If
a stockholder fails to provide a TIN to the Depositary, such stockholder may
be subject to a $50 penalty imposed by the Internal Revenue Service. In
addition, payments that are made to such stockholder with respect to Shares
purchased pursuant to the Offer may be subject to backup withholding of 31%
(see below).
Certain stockholders (including, among others, all corporations and certain
foreign individuals) are not subject to these backup withholding and reporting
requirements. In order for a foreign individual to qualify as an exempt
recipient, that stockholder must generally submit a Form W-8, signed under
penalties of perjury, attesting to that individual's exempt status. A Form W-8
can be obtained from the Depositary. See the enclosed Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9 for
additional instructions.
If backup withholding applies, the Depositary is required to withhold 31%
of any payments made to the stockholder or payee. Backup withholding is not an
additional tax. Rather, the tax liability of persons subject to backup
withholding will be reduced by the amount of tax withheld. If withholding
results in an overpayment of taxes, a refund may be obtained from the Internal
Revenue Service.
The box in Part 3 of the Substitute Form W-9 may be checked if the
tendering stockholder has not been issued a TIN and has applied for a TIN or
intends to apply for a TIN in the near future. If the box in Part 3 is
checked, the stockholder or other payee must also complete the Certification
of Awaiting Taxpayer Identification Number below in order to avoid backup
withholding. If a stockholder's TIN is provided to the Depositary within 60
days of the date of the Substitute Form W-9, payment will be made to such
stockholder without the imposition of backup withholding. If a stockholder's
TIN is not provided to the Depositary within such 60-day period, the
Depositary will make such payment, subject to backup withholding.
8
<PAGE>
Purpose of Substitute Form W-9
To prevent backup withholding on payments made to a stockholder whose
tendered Shares are accepted for purchase, the stockholder is required to
notify the Depositary of its correct TIN by completing Substitute Form W-9
certifying that the TIN provided on such Form is correct (or that such
stockholder is awaiting a TIN, in which case the stockholder should check the
box in Part 3 of the Substitute Form W-9) and that (A) such stockholder is
exempt from backup withholding, (B) such stockholder has not been notified by
the Internal Revenue Service that such stockholder is subject to backup
withholding as a result of failure to report all interest or dividends or (C)
the Internal Revenue Service has notified the stockholder that the stockholder
is no longer subject to backup withholding. The stockholder must sign and date
the Substitute Form W-9 where indicated, certifying that the information on
such Form is correct.
Alternatively, a stockholder that qualifies as an exempt recipient (other
than a stockholder required to complete Form W-8 as described above) should
write "Exempt" in Part 1 of the Substitute Form W-9, enter its correct TIN and
sign and date such Form where indicated.
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 owner of the Shares or
of the last transferee appearing on the transfers attached to, or endorsed on,
the Shares. If the Shares are in more than one name or are not in the name of
the actual owner, consult the enclosed Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9 for additional guidance
on which number to report.
TO BE COMPLETED BY ALL TENDERING STOCKHOLDERS
(See Instruction 9)
PAYER: [ ]
- - -------------------------------------------------------------------------------
Part 1--PLEASE PROVIDE Social security number or
YOUR Employer identification
number
SUBSTITUTE TIN IN THE BOX AT RIGHT
AND
FORM W-9
CERTIFY BY SIGNING AND ---------------------------
Part 2--Certification--Under penalties of perjury, I
certify that:
DATING BELOW
Department of the
Treasury ---------------------------------------------------------
(1) The number shown on this form is my correct
Internal Revenue Taxpayer Identification Number (or I am waiting for a
Service number to be issued to me); and
(2) I am not subject to backup withholding either
because (i) I am exempt from backup withholding, (ii)
I have not been notified by the Internal Revenue
Service (the "IRS") that I am subject to backup
withholding as a result of a failure to report all
interest or dividends, or (iii) the IRS has notified
me that I am no longer subject to backup withholding.
Payer's Request for
Taxpayer
Identification
Number (TIN) SIGNATURE DATE
NAME (Please Print) ___________________ Part 3
---------------------------------------------------------
Awaiting
Certification Instructions--You must TIN [_]
cross out item (2) in Part 2 above if
you have been notified by the IRS that
you are subject to backup withholding
because of under-reporting interest or
dividends on your tax return. However,
if after being notified by the IRS
that you were subject to backup
withholding you received another
notification from the IRS stating that
you are no longer subject to backup
withholding, do not cross out item
(2).
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER.
PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL INFORMATION.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED THE BOX IN PART 3
OF SUBSTITUTE FORM W-9.
9
<PAGE>
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer
identification number has not been issued to me, and either (i) 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 (ii) I intend to
mail or deliver an application in the near future. I understand that
if I do not provide a taxpayer identification number within 60 days,
31% of all reportable payments made to me thereafter will be withheld
until I provide a taxpayer identification number to the Depositary.
Signature.................................... Date...................
Name (Please Print)...................................................
Manually signed facsimile copies of this revised Letter of Transmittal or
an original (yellow) Letter of Transmittal will be accepted. The Letter of
Transmittal, certificates for Shares and any other required documents should
be sent or delivered by each stockholder of the Company or such stockholder's
broker, dealer, commercial bank, trust company or other nominee to the
Depositary at one of its addresses set forth below.
The Depositary for the Offer is:
CITIBANK, N.A.
By Hand: By Mail: By Overnight Courier:
Citibank, N.A. Citibank, N.A. Citibank, N.A.
Corporate Trust Window P.O. Box 685 915 Broadway, 5th Floor
111 Wall Street, 5th Old Chelsea Station New York, New York 10010
Floor New York, New York 10113
New York, New York
10043
Facsimile For Eligible Institutions: (212) 505-2248
To Confirm Facsimile Only: (800) 270-0808
DELIVERY OF THIS REVISED LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE TO A NUMBER OTHER
THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY TO THE
DEPOSITARY.
Questions and requests for assistance or for additional copies of this
revised Letter of Transmittal, the Offer to Purchase, the Supplement and the
Notice of Guaranteed Delivery may be directed to the Information Agent or the
Dealer Manager at their respective telephone numbers and locations listed
below. 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:
INNISFREE M&A INCORPORATED
501 Madison Avenue, 20th Floor
New York, New York 10022
Banks and Brokers Call Collect (212) 750-5833
All Others Call Toll Free (888) 750-5834
The Dealer Manager for the Offer is:
SALOMON SMITH BARNEY
Seven World Trade Center
New York, New York 10048
10
<PAGE>
Exhibit (a)(24)
Notice of Guaranteed Delivery
for
Tender of Shares of Common Stock
(Including the Associated Preferred Share Purchase Rights)
of
Varlen Corporation
Pursuant to the Offer to Purchase Dated May 24, 1999
and the Supplement thereto dated August 4, 1999
by
Track Acquisition Incorporated
A Wholly Owned Subsidiary of
Amsted Industries Incorporated
As set forth in Section 3 of the Offer to Purchase (as defined below), this
form or one substantially equivalent may be used to accept the Offer (as
defined below) if certificates for shares of common stock, par value $.10 per
share (the "Common Stock"), including the associated preferred share purchase
rights (the "Rights" and, collectively with the Common Stock, the "Shares"),
of Varlen Corporation, a Delaware corporation (the "Company"), are not
immediately available, or if the procedure for book-entry transfer cannot be
complied with on a timely basis, or all required documents cannot be delivered
to the Depositary prior to the Expiration Date (as defined in Section 1 of the
Offer to Purchase). This form may be delivered by hand to the Depositary or
transmitted by telegram, facsimile transmission or mail to the Depositary and
must include a guarantee by an Eligible Institution (as defined in Section 3
of the Offer to Purchase). See Section 3 of the Offer to Purchase.
The Depositary for the Offer is:
CITIBANK, N.A.
By Mail: By Overnight Courier:
By Hand:
Citibank, N.A. Citibank, N.A.
Citibank, N.A. P.O. Box 685 915 Broadway, 5th Floor
Corporate Trust Window Old Chelsea Station New York, New York 10010
111 Wall Street, 5th New York, New York 10113
Floor
New York, New York 10043
Facsimile For Eligible Institutions: (212) 505-2248
To Confirm Facsimile Only: (800) 270-0808
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE TO A NUMBER
OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY TO THE
DEPOSITARY.
This form is not to be used to guarantee signatures. If a signature on a
Letter of Transmittal is required to be guaranteed by an Eligible Institution
under the instructions thereto, such signature guarantee must appear in the
applicable space provided in the signature box on the Letter of Transmittal.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to Track Acquisition Incorporated, a
Delaware corporation and a wholly owned subsidiary of Amsted Industries
Incorporated, a Delaware corporation, on the terms and subject to the
conditions set forth in the Offer to Purchase, dated May 24, 1999 (the "Offer
to Purchase"), as amended and supplemented by the Supplement thereto dated
August 4, 1999 (the "Supplement") and the related revised (green) Letter of
Transmittal (which, as amended or supplemented from time to time, together
constitute the "Offer"), receipt of which is hereby acknowledged, the number
of Shares set forth below, all pursuant to the guaranteed delivery procedures
set forth in Section 3 of the Offer to Purchase.
Number of Shares: ___________________
Dated: ______________________________
Certificate Nos.(if available): _____ Name(s) of Record Holder(s): (Please
Print)
CHECK BOX IF SHARES WILL BE TENDERED -------------------------------------
BY BOOK-ENTRY TRANSFER [_] -------------------------------------
Address(es): (Include Zip Code)
Account Number: _____________________ -------------------------------------
-------------------------------------
Daytime Area Code
and Tel. No.: _______________________
Signature(s) ________________________
-------------------------------------
<PAGE>
GUARANTEE
(Not to be Used for Signature Guarantee)
The undersigned, a bank, broker, dealer, credit union, savings association
or other entity which is a member in good standing of the Securities Transfer
Agents Medallion Program or a bank, broker, dealer, credit union, savings
association or other entity which is an "eligible guarantor institution," as
such term is defined in Rule 17Ad-15 under the Securities Exchange Act of
1934, as amended (each of the foregoing constituting an "Eligible
Institution"), guarantees the delivery to the Depositary of the Shares
tendered hereby, in proper form of transfer, or a Book-Entry Confirmation (as
defined in the Offer to Purchase), together with a properly completed and duly
executed Letter of Transmittal, with any required signature guarantees, or an
Agent's Message (as defined in the Offer to Purchase) in the case of a book-
entry delivery, and any other required documents within three Nasdaq National
Market trading days of the date hereof.
The Eligible Institution that completes this form must communicate this
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.
Name of Firm: _____________________ -----------------------------------
(Authorized Signature)
Address: __________________________ Name: _____________________________
----------------------------------- (Please Print)
Area Code and Telephone Number: ___ Title: ____________________________
Dated: ____________________________
NOTE: DO NOT SEND CERTIFICATES FOR SHARES WITH THIS FORM. CERTIFICATES FOR
SHARES SHOULD BE SENT WITH YOUR LETTER OF TRANSMITTAL.
<PAGE>
Exhibit (a)(25)
Salomon Smith Barney
Seven World Trade Center
New York, New York 10048
Track Acquisition Incorporated
a wholly owned subsidiary of
Amsted Industries Incorporated
Has Increased the Price of its
Offer to Purchase for Cash
All of the Shares of Common Stock
(Including the Associated Preferred Share Purchase Rights)
of
Varlen Corporation
to
$42.00 Net Per Share
THE EXPIRATION DATE OF THE OFFER HAS BEEN EXTENDED SUCH THAT THE OFFER AND
WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON
FRIDAY, AUGUST 13, 1999, UNLESS THE OFFER IS FURTHER EXTENDED.
August 4, 1999
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
We have been engaged by Track Acquisition Incorporated, a Delaware
corporation (the "Purchaser") and a wholly owned subsidiary of Amsted
Industries Incorporated, a Delaware corporation ("Parent"), to act as Dealer
Manager in connection with the Purchaser's offer to purchase all outstanding
shares of common stock, par value $.10 per share (the "Common Stock"),
including the associated preferred share purchase rights (the "Rights" and,
together with the Common Stock, the "Shares"), of Varlen Corporation, a
Delaware corporation (the "Company"), at $42.00 per Share, net to the seller
in cash, on the terms and subject to the conditions set forth in the Offer to
Purchase, dated May 24, 1999 (the "Offer to Purchase"), as amended and
supplemented by the Supplement thereto dated August 4, 1999 (the
"Supplement"), and the related revised (green) 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 whom you hold Shares registered in your name or in the name of
your nominee.
The Company has amended the Rights Agreement to provide that neither Parent
nor any of Parent's "affiliates" or "associates", including the Purchaser,
will be deemed an Acquiring Person and that the Distribution Date will not be
deemed to occur, and that the Rights will not separate from the shares of
Common Stock, as a result of the entering into the Merger Agreement, the
commencement of the Offer or the consummation of the Merger.
Tendering stockholders may continue to use the original (yellow) Letter of
Transmittal and the original (blue) Notice of Guaranteed Delivery previously
circulated with the Offer to Purchase, or may use the revised (green) Letter
of Transmittal and the revised (grey) Notice of Guaranteed Delivery circulated
with the Supplement. While the original (yellow) Letter of Transmittal
previously circulated with the Offer to Purchase refers only to the Offer to
Purchase, stockholders using such document to tender their Shares will
nevertheless be deemed to be tendering pursuant to the amended offer
(including the amendments and supplements made by the Supplement) and will
receive $42.00 for each Share validly tendered and not properly withdrawn if
Shares are accepted for payment and paid for by the Purchaser pursuant to the
Offer.
<PAGE>
Enclosed herewith are the following documents:
1. Supplement, dated August 4, 1999;
2. The revised (green) Letter of Transmittal to be used by stockholders
of the Company in accepting the Offer;
3. A printed form of letter that may be sent to your clients for whose
account you hold Shares in your name or in the name of your nominee, with
space provided for obtaining such clients' instructions with regard to the
Offer;
4. The revised (grey) Notice of Guaranteed Delivery;
5. Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9; and
6. Return envelope addressed to Citibank, N.A., P.O. Box 685, Old
Chelsea Station, New York, New York 10113, the Depositary.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY
TENDERED PRIOR TO THE EXPIRATION OF THE OFFER AND NOT WITHDRAWN A NUMBER OF
SHARES WHICH, TOGETHER WITH THE SHARES BENEFICIALLY OWNED BY THE PURCHASER AND
ITS AFFILIATES, WILL CONSTITUTE AT LEAST A MAJORITY OF THE OUTSTANDING
SHARES ON A FULLY DILUTED BASIS AS OF THE DATE THE SHARES ARE ACCEPTED FOR
PAYMENT PURSUANT TO THE OFFER. THE OFFER IS ALSO SUBJECT TO CERTAIN OTHER
CONDITIONS DESCRIBED IN SECTION 8 OF THE SUPPLEMENT. THE OFFER IS NOT
CONDITIONED UPON PARENT OR THE PURCHASER OBTAINING FINANCING.
We urge you to contact your clients promptly. Please note that the Offer
and withdrawal rights will expire at 12:00 Midnight, New York City time, on
Friday, August 13, 1999, unless the Offer is extended.
In all cases, payment for Shares accepted for payment pursuant to the Offer
will be made only after timely receipt by the Depositary of (i) certificates
for such Shares or timely confirmation of the book-entry transfer of such
Shares into the Depositary's account at the Book-Entry Transfer Facility (as
defined in the Offer to Purchase) pursuant to the procedures set forth in
Section 3 of the Offer to Purchase, (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,
an Agent's Message (as defined in the Offer to Purchase)) and (iii) any other
documents required by such Letter of Transmittal. UNDER NO CIRCUMSTANCES WILL
INTEREST BE PAID ON THE PURCHASE PRICE FOR SHARES, REGARDLESS OF ANY EXTENSION
OF THE OFFER OR ANY DELAY IN MAKING SUCH PAYMENT PURSUANT TO THE OFFER.
Neither Parent nor the Purchaser will pay any fees or commissions to any
broker or dealer or other person (other than the Depositary, the Information
Agent and the Dealer Manager, as disclosed in the Offer to Purchase) in
connection with the solicitation of tenders of Shares pursuant to the Offer.
You will be reimbursed upon request for customary mailing and handling
expenses incurred by you in forwarding the enclosed offering materials to your
clients.
Questions and requests for assistance may be directed to the Information
Agent or the Dealer Manager at their respective addresses and telephone
numbers set forth on the back cover of the enclosed Supplement. Requests for
additional copies of the enclosed materials may be directed to the Information
Agent or the Dealer Manager or to brokers, dealers, commercial banks or trust
companies.
Very truly yours,
Salomon Smith Barney
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL RENDER YOU OR
ANY OTHER PERSON, THE AGENT OF PARENT, THE PURCHASER, THE DEALER MANAGER, THE
DEPOSITARY OR THE INFORMATION AGENT, OR ANY AFFILIATE OF ANY OF THEM, OR
AUTHORIZE YOU OR ANY OTHER PERSON TO GIVE ANY INFORMATION OR USE ANY DOCUMENT
OR MAKE ANY REPRESENTATION ON BEHALF OF ANY OF THEM WITH RESPECT TO THE OFFER
NOT CONTAINED IN THE OFFER TO PURCHASE THE SUPPLEMENT OR THE LETTER OF
TRANSMITTAL.
<PAGE>
Exhibit (a)(26)
Track Acquisition Incorporated
a wholly owned subsidiary of
Amsted Industries Incorporated
Has Increased the Price of its
Offer to Purchase for Cash
All of the Shares of Common Stock
(Including the Associated Preferred Share Purchase Rights)
of
Varlen Corporation
to
$42.00 Net Per Share
THE EXPIRATION DATE OF THE OFFER HAS BEEN EXTENDED SUCH THAT THE OFFER AND
WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON
FRIDAY, AUGUST 13, 1999, UNLESS THE OFFER IS FURTHER EXTENDED.
To Our Clients:
Enclosed for your consideration is a Supplement dated August 4, 1999 (the
"Supplement") to the Offer to Purchase, dated May 24, 1999 (the "Offer to
Purchase"), and the related revised (green) Letter of Transmittal (which,
together with any amendments or supplements thereto, collectively constitute
the "Offer") relating to the offer by Track Acquisition Incorporated, a
Delaware corporation (the "Purchaser") and a wholly owned subsidiary of Amsted
Industries Incorporated, a Delaware corporation ("Parent"), to purchase for
cash, all of the outstanding shares of common stock, par value $.10 per share
(the "Common Stock"), including the associated preferred share purchase rights
(the "Rights"), of Varlen Corporation, a Delaware corporation (the "Company")
(the Common Stock and the Rights together are referred to herein as the
"Shares"), on the terms and subject to the conditions set forth in the Offer.
The Company has amended the Rights Agreement to provide that neither Parent
nor any of Parent's "affiliates" or "associates", including the Purchaser,
will be deemed an Acquiring Person and that the Distribution Date will not be
deemed to occur, and that the Rights will not separate from the shares of
Common Stock, as a result of the entering into the Merger Agreement, the
commencement of the Offer or the consummation of the Merger.
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 REVISED (GREEN) LETTER OF
TRANSMITTAL IS FURNISHED TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED
TO TENDER SHARES HELD BY US FOR YOUR ACCOUNT.
We request instructions as to whether you wish to tender any of or all the
Shares held by us for your account, pursuant to the terms and conditions set
forth in the Offer.
Your attention is directed to the following:
1. The Offer price is $42.00 per Share, net to the seller in cash,
without interest thereon, upon the terms and subject to the conditions of
the Offer.
2. The Offer is being made for all of the outstanding Shares.
3. The Offer is conditioned upon, among other things, there being
validly tendered prior to the expiration of the Offer a number of Shares
which, together with the Shares beneficially owned by the
<PAGE>
Purchaser and its affiliates, will constitute at least a majority of the
outstanding Shares on a fully diluted basis as of the date the Shares are
accepted for payment pursuant to the Offer. The Offer is also subject to
certain other conditions described in Section 8 of the Supplement. The
Offer is not conditioned upon Parent or the Purchaser obtaining financing.
4. THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON FRIDAY, AUGUST 13, 1999, UNLESS THE OFFER IS FURTHER EXTENDED
BY THE PURCHASER (THE "EXPIRATION DATE").
5. Any stock transfer taxes applicable to a sale of Shares to the
Purchaser will be borne by the Purchaser, except as otherwise provided in
Instruction 6 of the Letter of Transmittal.
6. Tendering stockholders will not be obligated to pay brokerage fees or
commissions to Salomon Smith Barney Inc. (the "Dealer Manager"), Citibank,
N.A. (the "Depositary"), or Innisfree M&A Incorporated as the Information
Agent 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 in provided or unless the required
taxpayer identification information is provided. See Instruction 9 of the
Letter of Transmittal.
Your instructions to us should be forwarded promptly to permit us to submit
a tender on your behalf prior to the Expiration Date.
If you wish to have us tender any of 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 on the detachable part hereof. Your
instructions should be forwarded to us in ample time to permit us to submit a
tender on your behalf prior to the Expiration Date.
In all cases, payment for Shares accepted for payment pursuant to the Offer
will be made only after timely receipt by the Depositary, of (a) certificates
for (or a timely Book-Entry Confirmation (as defined in the Offer to Purchase)
with respect to) such Shares, (b) either the original (yellow) or revised
(green) Letter of Transmittal, properly completed and duly executed, with any
required signature guarantees, or, in the case of a book-entry transfer
effected pursuant to the procedure set forth in Section 3 of the Offer to
Purchase, an Agent's Message (as defined in the Offer to Purchase), and (c)
any other documents required by the Letter of Transmittal. Accordingly,
tendering stockholders may be paid at different times depending upon when
certificates for Shares or Book-Entry Confirmations with respect to Shares are
actually received by the Depositary. UNDER NO CIRCUMSTANCES WILL INTEREST BE
PAID ON THE PURCHASE PRICE FOR SHARES, REGARDLESS OF ANY EXTENSION OF THE
OFFER OR ANY DELAY IN MAKING PAYMENT PURSUANT TO THE OFFER.
The Offer is not being made to, nor will tenders be accepted from, or on
behalf of, holders of Shares in any jurisdiction in which the making or
acceptance of the Offer would not be in compliance with the laws of such
jurisdiction. In any jurisdiction where the securities or blue sky laws
require the Offer to be made by a licensed broker or dealer, the Offer will be
deemed made on behalf of the Purchaser by the Dealer Manager or one or more
registered brokers or dealers that are licensed under the laws of such
jurisdiction. An envelope in which to return your instructions to us is
enclosed. If you authorize tender of your Shares, all such Shares will be
tendered unless otherwise indicated in such instruction form. Please forward
your instructions to us as soon as possible to allow us ample time to tender
Shares on your behalf prior to the expiration of the Offer.
<PAGE>
Instructions with Respect to the Offer to Purchase for Cash
All of the Outstanding Shares of Common Stock
(Including the Associated Preferred Share Purchase Rights)
of
Varlen Corporation
The undersigned acknowledge(s) receipt of your letter, the Offer to Purchase
dated May 24, 1999 (the "Offer to Purchase"), as amended and supplemented by
the Supplement thereto dated August 4, 1999 (the "Supplement"), and the related
revised (green) Letter of Transmittal relating to the offer by Track
Acquisition Incorporated, a Delaware corporation and a wholly owned subsidiary
of Amsted Industries Incorporated, a Delaware corporation, to purchase for
$42.00, net to the seller in cash, all outstanding shares of common stock, par
value $.10 per share (the "Common Stock"), including the associated preferred
share purchase rights (the "Rights"), of Varlen Corporation, a Delaware
corporation. The Common Stock and the Rights together are referred to herein as
the "Shares."
This will instruct you to tender the number of Shares indicated below held
by you for the account of the undersigned, on the terms and subject to the
conditions set forth in the Offer to Purchase, the Supplement and the related
Letter of Transmittal.
Number of Shares to be Tendered:* SIGN HERE
----------------------------------
_______________ Shares ----------------------------------
Name(s) __________________________
----------------------------------
Dated: ________, 1999 (Please print name(s) and
address(es))
- - ------------------------------------------- Address(s) _______________________
Taxpayer Identification ----------------------------------
No. or Social Security No.
Daytime Area Code and Tel. No. ___
- - ---------------------
*UNLESS OTHERWISE INDICATED, IT WILL BE ASSUMED THAT ALL YOUR SHARES ARE TO BE
TENDERED.
<PAGE>
EXHIBIT (b)(2)
July 30, 1999
AMSTED Industries Incorporated
44th Floor--Boulevard Towers South
205 North Michigan Avenue
Chicago, Illinois 60601
Attention: Mr. Gary B. Montgomery
Vice President and CFO
$1,000,000,000 Senior Unsecured Credit Facilities
COMMITMENT LETTER
Dear Gary:
You have advised us that AMSTED Industries Incorporated ("AMSTED" or the
"Company"), a Delaware corporation, desires to establish $1,000,000,000 of
senior unsecured credit facilities (as further described herein, the
"Facilities"), the proceeds of which would be used (i) to finance the
acquisition (the "Acquisition") pursuant to a merger agreement (the "Merger
Agreement") of Varlen Corporation (the "Acquired Business"), (ii) to refinance
(the "Refinancing") all indebtedness outstanding under the Credit Agreement
dated as of July 1, 1997 (the "Existing Credit Agreement"), among the Company,
The First National Bank of Chicago and certain other lenders, and the
Company's existing senior unsecured private placement debt, (iii) to provide
working capital from time to time for the Company and its subsidiaries; and
(iv) for other general corporate purposes. You have asked Salomon Smith Barney
Inc. ("SSB") to act as advisor, lead arranger and book manager and Citibank,
N.A. ("Citibank"; together with SSB, "Citigroup") to commit to provide you
with financing commitments for the entire Facilities and to act as
Administrative Agent with respect to the Facilities and, subject to the terms
and conditions described in this letter, in the attached Fee Letter and the
attached Summary of Terms and Conditions (the "Term Sheet") (collectively, the
"Commitment Letter"), SSB and Citibank so agree.
Conditions Precedent
The commitment of Citibank hereunder is subject to: (i) the preparation,
execution and delivery of definitive loan documentation, including a credit
agreement incorporating substantially the terms and conditions outlined in
this Commitment Letter and otherwise satisfactory to us and our counsel; (ii)
the absence of (A) a material adverse change in the business, condition
(financial or otherwise), operations, performance or properties of the Company
and its subsidiaries, including the Acquired Business, taken as a whole, since
September 30, 1998, or (B) any change in loan syndication, financial or
capital market conditions generally that, in Citigroup's judgment, could be
reasonably expected to materially impair completion of a Successful
Syndication (as defined in the section captioned "Syndication" below) of the
Facilities; (iii) the accuracy and completeness in all material respects of
all representations that you make to us and all information (in the case of
the Acquired Business, to the Company's knowledge) that you furnish to us
(taken as a whole) and your compliance with the terms of this Commitment
Letter; (iv) the payment in full of all fees, expenses and other amounts
payable under this Commitment Letter; (v) Citigroup's satisfaction with the
terms of the Merger Agreement; (vi) a purchase price for the Acquired Business
not to exceed the amount set forth on Schedule 1 hereto and pro forma total
debt to EBITDA not to exceed 3.25x at closing; (vii) nothing shall have come
to the attention of Citigroup that is inconsistent in any material respect
with the Pre-Commitment Information (as defined below) that could be
reasonably expected to have a material adverse effect on the Company and its
subsidiaries assuming consummation of the Acquisition (taken as a whole); and
(viii) a closing of the Facilities on or prior to September 30, 1999.
<PAGE>
Commitment Termination
Citibank's commitment set forth in this Commitment Letter will terminate on
September 30, 1999, unless the Facilities close on or before such date.
Syndication
Citibank reserves the right, prior to or after the execution of definitive
documentation with respect to the Facilities, to syndicate all or a portion of
its commitment to one or more other financial institutions that will become
parties to such definitive documentation pursuant to a syndication to be
managed by SSB (the financial institutions becoming parties to such definitive
documentation being collectively referred to herein the "Lenders"). You
understand that SSB intends to commence syndication efforts promptly after
AMSTED publicly announces the Acquisition, and that it may elect to appoint one
or more syndication agents (which may include Citibank) to direct the
syndication efforts on its behalf.
SSB will act as the lead arranger and book manager with respect to the
Facilities and will manage all aspects of the syndication in consultation with
you, including the timing of all offers to potential Lenders, the acceptance of
commitments, and the determination of the amounts offered and the compensation
provided.
You agree to take all action as SSB may reasonably request to assist it and
you in forming a syndicate acceptable to SSB and you. Your assistance in
forming such syndicate shall include but will not be limited to: (i) making
senior management and representatives of the Company available to participate
in information meetings with potential Lenders at such times and places as SSB
may reasonably request; (ii) using your reasonable efforts to ensure that the
syndication efforts benefit from your bank relationships; and (iii) providing
SSB with all information reasonably deemed necessary by it to successfully
complete the syndication.
To ensure an orderly and effective syndication of the Facilities, you agree
that until the completion of a Successful Syndication (as defined below) or
expiration of this commitment letter, you will not, and will not permit any of
your subsidiaries to, syndicate or issue, attempt to syndicate or issue,
announce or authorize the announcement of the syndication or issuance of, or
engage in discussions concerning the syndication or issuance of, any debt
facility or debt security (including any renewals of any such security but
excluding working capital, debt under existing facilities and other debt having
an outstanding principal amount not in excess of $50 million), without the
prior written consent of SSB.
You agree that Citibank will act as the sole Administrative Agent for the
Facilities and that SSB will act as sole lead arranger and book manager and
that no additional agents, co-agents or arrangers will be appointed, or other
titles conferred, without the consent of SSB and Citibank.
Provided that the aggregate amount of the Facilities remains unchanged and
subject to the terms of the Fee Letter (as defined below), SSB reserves the
right at any time, after consultation with you, to change any or all of the
terms, structure, tenor, or pricing of the Facilities if SSB determines that
such changes are advisable in SSB's judgment, to ensure that the Facilities are
successfully syndicated such that, as a result of such syndication, the
commitment of Citigroup is reduced to $125 million in a syndication to
prospective Lenders (herein defined as a "Successful Syndication"). Citigroup's
commitment is subject to this paragraph.
Fees
In addition to the fees described in Annex I, you agree to pay the fees set
forth in that certain letter of even date herewith (the "Fee Letter"). The
terms of the Fee Letter are an integral part of Citibank's commitment and SSB's
undertaking hereunder, and constitute part of this Commitment Letter for all
purposes hereof. Each of the fees described in the Fee Letter shall be
nonrefundable when paid.
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<PAGE>
Indemnification
You agree to indemnify and hold harmless Citigroup, each Lender and each of
their affiliates and each of their respective officers, directors, employees,
agents, advisors and representatives (each, an "Indemnified Party") from and
against any and all claims, damages, losses, liabilities and expenses
(including, without limitation, fees and disbursements of counsel), joint or
several, that may be incurred by or asserted or awarded against any
Indemnified Party, in each case arising out of or in connection with or
relating to any investigation, litigation or proceeding or the preparation of
any defense with respect thereto arising out of or in connection with or
relating to this Commitment Letter or the loan documentation or the
transactions contemplated hereby or thereby, or any use made or proposed to be
made with the proceeds of the Facilities, whether or not such investigation,
litigation or proceeding is brought by the Company, any of its shareholders or
creditors, any Indemnified Party or any other person, or an Indemnified Party
is otherwise a party thereto and whether or not the transactions contemplated
hereby are consummated, except to the extent such claim, damage, loss,
liability or expense is found in a final judgment by a court of competent
jurisdiction to have resulted from such Indemnified Party's breach of
contract, gross negligence or willful misconduct.
You agree that no Indemnified Party shall have any liability (whether
direct or indirect, in contract, tort or otherwise) to the Company or any of
its shareholders or creditors for or in connection with the transactions
contemplated hereby, except to the extent such liability is found in a final
non-appealable judgment by a court of competent jurisdiction to have resulted
from such Indemnified Party's breach of contract, gross negligence or willful
misconduct.
Costs and Expenses
In further consideration of the commitment of Citigroup hereunder, and
recognizing that in connection herewith Citigroup is incurring substantial
costs and expenses (including, without limitation, fees and disbursements of
counsel and its syndication agents, filing and recording fees and due
diligence, syndication (including printing, distribution and bank meetings),
transportation, computer, duplication, messenger, appraisal, audit, insurance
and consultant costs and expenses), you hereby agree to pay, or reimburse
Citigroup on demand for, all such reasonable costs and expenses (whether
incurred before or after the date hereof), regardless of whether any of the
transactions contemplated hereby are consummated. You also agree to pay all
reasonable costs and expenses of Citigroup (including, without limitation,
reasonable fees and disbursements of counsel) incurred in connection with the
enforcement of any of its rights and remedies hereunder.
Confidentiality
By accepting delivery of this Commitment Letter, you agree that this
Commitment Letter is for your confidential use only and that neither its
existence nor the terms hereof will be disclosed by you to any person other
than your officers, directors, employees, accountants, attorneys and other
advisors, and than only on a "need to know" basis in connection with the
transactions contemplated hereby and on a confidential basis. Notwithstanding
the foregoing, following your acceptance of the provisions hereof and your
return of an executed counterpart of this Commitment Letter to us as provided
below, (i) you may make public disclosure of the existence and amount of
Citigroup's commitment hereunder and of Citibank's identity as Administrative
Agent, (ii) you may file a copy of this Commitment Letter (other than the Fee
Letter) in any public record in which it is required by law to be filed and
(iii) you may make such other public disclosures of the terms and conditions
hereof as you are required by law, in the opinion of your counsel, to make.
Representations and Warranties of the Company
You represent and warrant that (i) all information (in the case of the
Acquired Business, to the Company's knowledge) that has been or will hereafter
be made available to Citigroup, any Lender or any potential Lender by you or
any of your representatives in connection with the transaction contemplated
hereby (when taken as a
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<PAGE>
whole) is and will be complete and correct in all material respects and does
not and will not contain any untrue statement of a material fact or omit to
state a material fact necessary in order to make the statements contained
therein not misleading in light of the circumstances under which such
statements were or are made and (ii) all financial projections that have been
or will be prepared by you and made available to Citigroup, SSB, any Lender or
any potential Lender have been or will be prepared in good faith based upon
reasonable assumptions at the time made and at the time the related
projections were made available to Citigroup. During the period prior to
termination of this Commitment Letter, you agree to supplement the information
and projections from time to time so that the representations and warranties
contained in this paragraph remain correct.
In issuing this undertaking, Citigroup is relying on the accuracy of the
information furnished to it by or on behalf of the Company and its
subsidiaries (the "Pre-Commitment Information") without independent
verification thereof.
Assignments
The Company may not assign this Commitment Letter or Citigroup's commitment
hereunder without Citicorp's prior written consent, and any attempted
assignment without such consent shall be void.
No Third Party Reliance, Etc.
The agreements of Citigroup hereunder and of any Lender that issues a
commitment to provide financing under the Facilities are made solely for the
benefit of the Company and may not be relied upon or enforced by any other
person. Please note that those matters that are not covered or made clear
herein or in Annex I or in the Fee Letter are subject to mutual agreement of
the parties. The terms and conditions of this undertaking may be modified only
in writing. This letter is not intended to create a fiduciary relationship
among the parties hereto.
Governing Law, Etc.
This Commitment Letter shall be governed by, and construed in accordance
with, the laws of the State of New York. This Commitment Letter sets forth the
entire agreement between the parties with respect to the matters addressed
herein and supersedes all prior communications, written or oral, with respect
thereto. This Commitment Letter may be executed in any number of counterparts,
each of which, when so executed, shall be deemed to be an original and all of
which, taken together, shall constitute one and the same Commitment Letter.
Delivery of an executed counterpart of a signature page to this Commitment
Letter by telecopier shall be as effective as delivery of a manually executed
counterpart of this Commitment Letter. Your obligations under the paragraphs
captioned "Fees", "Indemnification", "Costs and Expenses", "Confidentiality"
and "Representations and Warranties" shall survive the expiration or
termination of this Commitment Letter whether or not the definitive documents
shall be executed and delivered.
Waiver of Jury Trial
Each party hereto irrevocably waives all right to trial by jury in any
action, proceeding or counterclaim (whether based on contract, tort or
otherwise) arising out of or relating to this Commitment Letter or the
transactions contemplated hereby or the actions of Citigroup or SSB in the
negotiation, performance or enforcement hereof.
Please indicate your acceptance of the provisions hereof by signing the
enclosed copy of this Commitment Letter and the Fee Letter and returning them
to Jordan Schweon, Managing Director, Citibank, N.A., 399 Park Avenue, 11th
Floor, New York, New York 10043 (fax: (212) 793-3963) at or before 5 p.m. (New
York City time) on July 30, 1999, the time at which the commitment of
Citigroup set forth above (if not so accepted prior thereto) will expire. This
Commitment Letter and the accompanying Fee Letter supersede and replace the
corresponding letters dated April 29, 1999, except that any accrued and unpaid
Facility Fee and accrued and unpaid expenses and liabilities under such
corresponding letters as of the date hereof will be treated as though accrued
and payable under this Commitment Letter and the accompanying Fee Letter. If
you elect to deliver this Commitment Letter by telecopier, please arrange for
the executed original to follow by next-day courier.
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<PAGE>
Very truly yours,
Salomon Smith Barney Inc.
/s/ Douglas Greeff
By: _________________________________
Title: Attorney in Fact
Citibank, N.A.
/s/ Jordan Schweon
By: _________________________________
Title: Managing Director and Vice
President
ACCEPTED AND AGREED
this 30th day of July, 1999:
Amsted Industries Incorporated
/s/ Gary B. Montgomery
By: _________________________________
Title: Vice President
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