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SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
SCHEDULE 14D-1
TENDER OFFER STATEMENT PURSUANT TO
SECTION 14(d)(1) OF THE SECURITIES EXCHANGE ACT OF 1934
------------------------
AMERICAN MEDICAL RESPONSE, INC.
(Name of Subject Company)
MEDTRANS ACQUISITION CO.
LAIDLAW INC.
(Bidders)
COMMON STOCK, PAR VALUE $.01 PER SHARE
(Title of Class of Securities)
027446 10 3
(Cusip Number of Class of Securities)
------------------------
IVAN R. CAIRNS
SENIOR VICE PRESIDENT AND GENERAL COUNSEL
LAIDLAW INC.
3221 NORTH SERVICE ROAD
BURLINGTON, ONTARIO L7R 3Y8
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidders)
------------------------
COPY TO:
STEPHEN J. DRAGICH
SCHIFF HARDIN & WAITE
7200 Sears Tower
Chicago, Illinois
(312) 258-5692
------------------------
CALCULATION OF FILING FEE
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Transaction Valuation*: $1,211,107,320 Amount of Filing Fee**: $242,221.46
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</TABLE>
* For purposes of calculating the fee only. This amount assumes the purchase
of 30,277,683 shares of common stock, par value $.01 per share (the
"Shares"), of the subject company for $40.00 cash per Share, based on the
number of Shares represented by the subject company in the Agreement and
Plan of Merger, dated as of January 6, 1997, as outstanding or issuable on
December 31, 1996, and the number of Shares issuable upon exercise of all
outstanding options under the subject company's stock option plans and
agreements and stock purchase plan, and upon conversion of all outstanding
convertible notes.
** The amount of the filing fee, calculated in accordance with Rule 0-11(d)
under the Securities Exchange Act of 1934, as amended, equals 1/50th of one
percent of the aggregate of the cash offered by the bidders.
/ / Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number, or the form
or schedule and the date of its filing.
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Amount Previously Paid: Not Applicable Filing Party: Not Applicable
Form or Registration No.: Not Applicable Date Filed: Not Applicable
</TABLE>
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<PAGE>
14D-1
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CUSIP No. 027446 10 3 Page 2
1. Name of Reporting Persons
S.S. or I.R.S. Identification Nos. of Above Persons
MEDTRANS ACQUISITION CO.
2. Check the Appropriate Box if a Member of a Group
(a) /X/
(b) / /
3. SEC Use Only
4. Sources of Funds
WC, AF
5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(e) or 2(f)
/ /
6. Citizenship or Place of Organization
DELAWARE
7. Aggregate Amount Beneficially Owned by Each Reporting Person
480,000
8. Check if the Aggregate Amount in Row 7 Excludes Certain Shares
/ /
9. Percent of Class Represented by Amount in Row 7
2.3%
10. Type of Reporting Person
CO
</TABLE>
2
<PAGE>
14D-1
<TABLE>
<C> <S>
CUSIP No. 027446 10 3 Page 3
1. Name of Reporting Persons
S.S. or I.R.S. Identification Nos. of Above Persons
LAIDLAW INC.
2. Check the Appropriate Box if a Member of a Group
(a) /X/
(b) / /
3. SEC Use Only
4. Sources of Funds
WC, OO
5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(e) or 2(f)
/X/
6. Citizenship or Place of Organization
CANADA
7. Aggregate Amount Beneficially Owned by Each Reporting Person
480,000
8. Check if the Aggregate Amount in Row 7 Excludes Certain Shares
/ /
9. Percent of Class Represented by Amount in Row 7
2.3%
10. Type of Reporting Person
CO
</TABLE>
3
<PAGE>
SCHEDULE 14D-1
This Tender Offer Statement on Schedule 14D-1 relates to the offer by
MedTrans Acquisition Co. (the "Purchaser"), a Delaware corporation and a
wholly-owned subsidiary of Laidlaw Inc., a Canadian corporation ("Laidlaw"), to
purchase all of the outstanding shares of common stock, par value $.01 per share
(the "Shares"), of American Medical Response, Inc. at a purchase price of $40.00
per Share, net to the seller in cash, without interest thereon, upon the terms
and subject to the conditions set forth in the Offer to Purchase dated January
10, 1997 and in the related Letter of Transmittal (which, together with any
supplements or amendments, collectively constitute the "Offer"), copies of which
are attached as Exhibits (a)(1) and (a)(2) hereto, respectively. The item
numbers and responses thereto below are in accordance with the requirements of
Schedule 14D-1.
ITEM 1. SECURITY AND SUBJECT COMPANY.
(a) The name of the subject company is American Medical Response, Inc., a
Delaware corporation (the "Company"). The address of the Company's principal
executive offices is 2821 South Parker Road, 10th Floor, Aurora, Colorado 80014.
The address of the Purchaser's principal executive office is 669 Airport
Freeway, Suite 400, Hurst, Texas 76503.
(b) The class of equity securities to which this Schedule 14D-1 relates is
common stock, par value $.01 per share, of the Company. The information set
forth in the Offer to Purchase under "Introduction" is incorporated herein by
reference.
(c) The information set forth in the Offer to Purchase under "Introduction"
and in Section 6 ("Price Range of Shares; Dividends") is incorporated herein by
reference.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(d), (g) This Statement is being filed by the Purchaser and Laidlaw.
The information set forth in the Offer to Purchase under "Introduction," in
Section 8 ("Certain Information Concerning the Purchaser and Laidlaw") and in
Schedule I to the Offer to Purchase is incorporated herein by reference.
(e)-(f) During the last five years, neither the Purchaser, Laidlaw nor, to
the best of their knowledge, any of the persons listed in Schedule I to the
Offer to Purchase (i) has been convicted in a criminal proceeding (excluding
traffic violations or similar misdemeanors) or (ii) was a party to a civil
proceeding of a judicial or administrative body of competent jurisdiction and as
a result of such proceeding was or is subject to a judgment, decree or final
order enjoining further violations of or prohibiting activities subject to
federal or state securities laws or finding any violation with respect to such
laws.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
(a)-(b) The information set forth in the Offer to Purchase under
"Introduction," in Section 10 ("Background of the Offer; Contacts with the
Company") and in Section 11 ("Purpose of the Offer; Merger Agreement; Plans for
the Company") is incorporated herein by reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a)-(b) The information set forth in the Offer to Purchase in Section 9
("Source and Amount of Funds") is incorporated herein by reference.
(c) Not applicable.
4
<PAGE>
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER.
(a)-(c) The information set forth in the Offer to Purchase under
"Introduction," in Section 10 ("Background of the Offer; Contacts with the
Company") and in Section 11 ("Purpose of the Offer; Merger Agreement; Plans for
the Company") is incorporated herein by reference.
(d) The information set forth in the Offer to Purchase in Section 10
("Background of the Offer; Contacts with the Company") and in Section 11
("Purpose of the Offer; Merger Agreement; Plans for the Company") is
incorporated herein by reference.
(e)-(g) The information set forth in the Offer to Purchase in Section 11
("Purpose of the Offer; Merger Agreement; Plans for the Company") and in Section
13 ("Effect of the Offer on the Market for the Shares, NYSE Listing and Exchange
Act Registration") is incorporated herein by reference.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a) The information set forth in the Offer to Purchase under "Introduction,"
in Section 8 ("Certain Information Concerning the Purchaser and Laidlaw"), in
Section 10 ("Background of the Offer; Contacts with the Company") and in Section
11 ("Purpose of the Offer; Merger Agreement; Plans for the Company") is
incorporated herein by reference.
(b) The information set forth in the Offer to Purchase in Section 10
("Background of the Offer; Contacts with the Company") is incorporated herein by
reference.
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT
TO THE SUBJECT COMPANY'S SECURITIES.
The information set forth in the Offer to Purchase under "Introduction," in
Section 8 ("Certain Information Concerning the Purchaser and Laidlaw"), in
Section 9 ("Source and Amount of Funds"), in Section 10 ("Background of the
Offer; Contacts with the Company") and in Section 11 ("Purpose of the Offer;
Merger Agreement; Plans for the Company") is incorporated herein by reference.
ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED.
The information set forth in the Offer to Purchase under "Introduction" and
in Section 16 ("Fees and Expenses") is incorporated herein by reference.
ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS.
The information set forth in the Offer to Purchase in Section 8 ("Certain
Information Concerning the Purchaser and Laidlaw") is incorporated herein by
reference.
ITEM 10. ADDITIONAL INFORMATION.
(a) The information set forth in the Offer to Purchase in Section 11
("Purpose of the Offer; Merger Agreement; Plans for the Company") is
incorporated herein by reference.
(b)-(e) The information set forth in the Offer to Purchase under
"Introduction," in Section 13 ("Effect of the Offer on the Market for the
Shares, NYSE Listing and Exchange Act Registration") and in Section 15 ("Certain
Legal Matters and Regulatory Approvals") is incorporated herein by reference.
(f) The information set forth in the Offer to Purchase and the related
Letter of Transmittal, copies of which are filed as Exhibits (a)(1) and (a)(2)
hereto, respectively, is incorporated herein by reference in its entirety.
5
<PAGE>
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
(a)(1) Offer to Purchase, dated January 10, 1997.
(a)(2) Letter of Transmittal.
(a)(3) Notice of Guaranteed Delivery.
(a)(4) Letter from the Information Agent to Brokers, Dealers, Commercial
Banks, Trust Companies and Nominees.
(a)(5) Letter to clients for use by Brokers, Dealers, Commercial Banks, Trust
Companies and Nominees.
(a)(6) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9.
(a)(7) Form of summary advertisement, dated January 10, 1997.
(a)(8) Text of press release issued by Laidlaw on January 6, 1997.
(b) Not applicable.
(c) Agreement and Plan of Merger, dated as of January 6, 1997, by and
among the Company, the Purchaser and Laidlaw.
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
6
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this statement is true, complete and correct.
Dated: January 10, 1997 MEDTRANS ACQUISITION CO.
By: /s/ IVAN R. CAIRNS
-------------------------------------------
Its: SENIOR VICE PRESIDENT
-------------------------------------------
LAIDLAW INC.
By: /s/ IVAN R. CAIRNS
-------------------------------------------
Its: SENIOR VICE PRESIDENT AND GENERAL COUNSEL
-------------------------------------------
7
<PAGE>
EXHIBIT INDEX
EXHIBIT
NO. DESCRIPTION
- -------- --------------------------------------------------------------------
(a)(1) Offer to Purchase, dated January 10, 1997.
(a)(2) Letter of Transmittal.
(a)(3) Notice of Guaranteed Delivery.
(a)(4) Letter from the Information Agent to Brokers, Dealers, Commercial
Banks, Trust Companies and Nominees.
(a)(5) Letter to clients for use by Brokers, Dealers, Commercial Banks,
Trust Companies and Nominees.
(a)(6) Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9.
(a)(7) Form of summary advertisement, dated January 10, 1997.
(a)(8) Text of press release issued by Laidlaw on January 6, 1997.
(c) Agreement and Plan of Merger, dated as of January 6, 1997, by and
among the Company, the Purchaser and Laidlaw.
8
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
AMERICAN MEDICAL RESPONSE, INC.
AT
$40.00 NET PER SHARE
BY
MEDTRANS ACQUISITION CO.
AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF
LAIDLAW INC.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON FRIDAY, FEBRUARY 7, 1997, UNLESS THE OFFER IS EXTENDED.
THE BOARD OF DIRECTORS OF AMERICAN MEDICAL RESPONSE, INC. (THE "COMPANY")
HAS UNANIMOUSLY APPROVED THE OFFER AND THE MERGER, DETERMINED THAT THE OFFER AND
THE MERGER DESCRIBED HEREIN ARE FAIR AND IN THE BEST INTEREST OF THE COMPANY'S
STOCKHOLDERS AND RECOMMENDS THAT ALL STOCKHOLDERS TENDER THEIR SHARES.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER OF
SHARES REPRESENTING AT LEAST TWO-THIRDS OF THE OUTSTANDING SHARES OF THE
COMPANY, ASSUMING CERTAIN EXERCISES AND CONVERSIONS (THE "MINIMUM CONDITION").
THE OFFER IS ALSO SUBJECT TO CERTAIN OTHER TERMS AND CONDITIONS. SEE SECTION 14.
THE OFFER IS NOT CONDITIONED UPON LAIDLAW OR THE PURCHASER OBTAINING
FINANCING.
--------------------------
IMPORTANT
ANY STOCKHOLDER DESIRING TO TENDER ALL OR ANY PORTION OF SUCH STOCKHOLDER'S
SHARES SHOULD EITHER (I) COMPLETE AND SIGN THE LETTER OF TRANSMITTAL (OR A
FACSIMILE THEREOF) IN ACCORDANCE WITH THE INSTRUCTIONS IN THE LETTER OF
TRANSMITTAL AND MAIL OR DELIVER THE LETTER OF TRANSMITTAL (OR SUCH FACSIMILE)
TOGETHER WITH THE CERTIFICATE(S) EVIDENCING THE TENDERED SHARES AND ANY OTHER
REQUIRED DOCUMENTS TO THE DEPOSITARY, OR TENDER SUCH SHARES PURSUANT TO THE
PROCEDURES FOR BOOK-ENTRY TRANSFER SET FORTH IN SECTION 3; OR (II) REQUEST SUCH
STOCKHOLDER'S BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR OTHER NOMINEE TO
EFFECT THE TRANSACTION FOR SUCH STOCKHOLDER. A STOCKHOLDER WHOSE SHARES ARE
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 SUCH STOCKHOLDER DESIRES TO TENDER SHARES SO REGISTERED.
A STOCKHOLDER WHO DESIRES TO TENDER SHARES AND WHOSE CERTIFICATES EVIDENCING
SUCH SHARES ARE NOT IMMEDIATELY AVAILABLE, OR WHO CANNOT COMPLY WITH THE
PROCEDURES FOR BOOK-ENTRY TRANSFER DESCRIBED IN THIS OFFER TO PURCHASE ON A
TIMELY BASIS, MAY TENDER SUCH SHARES BY FOLLOWING THE PROCEDURES FOR GUARANTEED
DELIVERY SET FORTH IN SECTION 3.
QUESTIONS AND REQUESTS FOR ASSISTANCE, OR FOR ADDITIONAL COPIES OF THIS
OFFER TO PURCHASE, THE LETTER OF TRANSMITTAL OR OTHER OFFER MATERIALS, MAY BE
DIRECTED TO THE INFORMATION AGENT OR TO THE DEALER MANAGER AT THEIR RESPECTIVE
ADDRESSES AND TELEPHONE NUMBERS SET FORTH ON THE BACK COVER OF THIS OFFER TO
PURCHASE. STOCKHOLDERS MAY ALSO CONTACT BROKERS, DEALERS, COMMERCIAL BANKS OR
TRUST COMPANIES FOR ASSISTANCE CONCERNING THE OFFER.
--------------------------
THE DEALER MANAGER FOR THE OFFER IS:
MERRILL LYNCH & CO.
January 10, 1997
<PAGE>
TABLE OF CONTENTS
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PAGE
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INTRODUCTION............................................................................................... 1
THE OFFER.................................................................................................. 3
Section 1. Terms of the Offer; Expiration Date............................................................. 3
Section 2. Acceptance for Payment and Payment for Shares................................................... 4
Section 3. Procedure for Tendering Shares.................................................................. 6
Section 4. Withdrawal Rights............................................................................... 9
Section 5. Certain U.S. Federal Income Tax Matters......................................................... 9
Section 6. Price Range of Shares; Dividends................................................................ 10
Section 7. Certain Information Concerning the Company...................................................... 11
Section 8. Certain Information Concerning the Purchaser and Laidlaw........................................ 12
Section 9. Source and Amount of Funds...................................................................... 14
Section 10. Background of the Offer; Contacts with the Company............................................. 15
Section 11. Purpose of the Offer; Merger Agreement; Plans for the Company.................................. 17
Section 12. Dividends and Distributions.................................................................... 24
Section 13. Effect of the Offer on the Market for the Shares, NYSE Listing and Exchange Act Registration... 25
Section 14. Certain Conditions of the Offer................................................................ 25
Section 15. Certain Legal Matters and Regulatory Approvals................................................. 27
Section 16. Fees and Expenses.............................................................................. 29
Section 17. Miscellaneous.................................................................................. 30
Schedule I-- Information Concerning the Directors and Executive Officers of Laidlaw and the Purchaser...... S-1
</TABLE>
<PAGE>
TO: THE HOLDERS OF COMMON STOCK OF
AMERICAN MEDICAL RESPONSE, INC.:
INTRODUCTION
MedTrans Acquisition Co. (the "Purchaser"), a Delaware corporation and an
indirect wholly-owned subsidiary of Laidlaw Inc., a Canadian corporation
("Laidlaw"), hereby offers to purchase all of the outstanding shares of common
stock, par value $0.01 per share (the "Shares"), of American Medical Response,
Inc., a Delaware corporation (the "Company"), at a purchase price of $40.00 per
Share, net to the seller in cash, without interest thereon, upon the terms and
subject to the conditions set forth in this Offer to Purchase and in the related
Letter of Transmittal (which, together with any supplements or amendments,
collectively constitute the "Offer").
Tendering stockholders will not be obligated to pay brokerage fees or
commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, stock transfer taxes on the transfer and sale of Shares pursuant to
the Offer. The Purchaser will pay all fees and expenses of The First National
Bank of Boston, as Depositary (the "Depositary"), Morrow & Co., Inc., as
Information Agent (the "Information Agent"), and Merrill Lynch & Co. (the
"Dealer Manager") incurred in connection with the Offer. See Section 16.
The Offer is conditioned upon, among other things, there having been validly
tendered and not properly withdrawn prior to the expiration of the Offer a
number of Shares which constitutes at least two-thirds of the Company's
outstanding voting power (assuming exercise of all outstanding options to
purchase shares of Common Stock the holders of which have not entered into an
agreement to cancel such options as described in the Merger Agreement (as
defined below) and the conversion of all of the Company's Convertible
Subordinated Notes (the "Notes")) (the "Minimum Condition"). The Company has
informed the Purchaser that as of December 31, 1996, there were 21,047,345
Shares issued and outstanding, 1,999,180 shares of Common Stock reserved for
issuance under the Company's stock option plans and agreements and stock
purchase plan, 3,311,258 shares of Common Stock reserved for issuance upon
conversion of the Notes, and 3,919,900 shares of Common Stock issuable in
connection with the acquisition of STAT Healthcare, Inc., and that, except as
otherwise disclosed in the Merger Agreement, no other stock of the Company is
outstanding or committed to be issued. Based on this information and assuming
all holders of outstanding options to purchase shares of Common Stock will have
entered into agreements to cancel such options effective on the date Purchaser
purchases the Shares pursuant to the Offer, the Purchaser believes that the
Minimum Condition will be satisfied if the Purchaser acquires at least
18,852,335 Shares in the Offer. Laidlaw directly or indirectly holds 480,000
Shares. These Shares will not be tendered but will count toward the satisfaction
of the Minimum Condition. Certain other conditions to the Offer are described in
Section 14. The Purchaser expressly reserves the right to waive any one or more
of the conditions to the Offer, although the Minimum Condition cannot be waived
without the consent of the Company.
The Offer is being made pursuant to the Agreement and Plan of Merger, dated
as of January 6, 1997 (the "Merger Agreement"), by and among the Company,
Laidlaw and the Purchaser. The Merger Agreement provides, among other things,
that as soon as practicable after the consummation of the Offer and satisfaction
or, to the extent permitted under the Merger Agreement, waiver of all conditions
to the Merger, the Purchaser will be merged with and into the Company (the
"Merger"). Following consummation of the Merger, the Company will continue as
the surviving corporation of the Merger and as an indirect wholly-owned
subsidiary of Laidlaw. Thereupon, each outstanding Share (other than treasury
Shares, Shares held by Laidlaw, the Purchaser or any other subsidiary of
Laidlaw, and Shares held by stockholders, if any, who properly exercise
appraisal rights) will be converted into and represent the right to receive
$40.00 in cash, or any higher price that may be paid per Share in the Offer,
without interest. See Section 11.
1
<PAGE>
THE BOARD OF DIRECTORS OF THE COMPANY (THE "BOARD OF DIRECTORS" OR THE
"BOARD") HAS UNANIMOUSLY APPROVED EACH OF THE OFFER AND THE MERGER, HAS
DETERMINED THAT EACH OF THE OFFER AND THE MERGER IS FAIR AND IN THE BEST
INTEREST OF THE COMPANY'S STOCKHOLDERS, AND RECOMMENDS THAT ALL STOCKHOLDERS
TENDER THEIR SHARES PURSUANT TO THE OFFER.
The Company has advised Laidlaw that Smith Barney Inc. ("Smith Barney"),
financial advisor to the Company, has delivered to the Board of Directors a
written opinion dated January 6, 1997 to the effect that, as of such date and
based upon and subject to certain matters stated in such opinion, the $40.00 per
Share cash consideration to be received by the holders of Shares (other than
Laidlaw and its affiliates) pursuant to the Offer and the Merger, taken
together, was fair to such holders from a financial point of view. A copy of the
written opinion of Smith Barney dated January 6, 1997, which sets forth the
assumptions made, factors considered and limitations on the review undertaken,
is contained in the Company's Solicitation/Recommendation Statement on Schedule
14D-9 (the "Schedule 14D-9"), which is being mailed to stockholders concurrently
herewith and should be carefully read in its entirety.
The Merger Agreement provides that, commencing upon the purchase of Shares
pursuant to the Offer, and from time to time thereafter, Purchaser shall be
entitled to designate on the Board of Directors up to such number of directors,
rounded up to the next whole number, as will give Laidlaw representation on the
Board equal to the product of (i) the total number of directors on the Board and
(ii) the percentage that the aggregate number of Shares directly or indirectly
owned by Purchaser and its affiliates bears to the total number of outstanding
Shares. In the Merger Agreement, the Company, subject to certain limitations
(see Section 11), has agreed to take all action necessary to cause Purchaser's
designees to be elected or appointed as directors of the Company, including
increasing the size of the Board or securing the resignation of incumbent
directors or both.
The consummation of the Merger is subject to the satisfaction or waiver of
certain conditions, including, if required by law, the approval and adoption of
the Merger Agreement by the requisite vote of the stockholders of the Company.
See Section 11 and Section 14. Under the Company's Certificate of Incorporation
and the General Corporation Law of the State of Delaware ("Delaware Law"), the
holders of Shares have one vote for each Share owned by them of record. Under
the Company's Certificate of Incorporation, a two-thirds vote of the then
outstanding Shares is required to approve and adopt the Merger Agreement and the
Merger. Consequently, if the Purchaser acquires (pursuant to the Offer or
otherwise) at least two-thirds of the then outstanding Shares, the Purchaser
will have sufficient voting power to approve and adopt the Merger Agreement and
the Merger without the vote of any other stockholders.
Under Delaware Law, if the Purchaser acquires, pursuant to the Offer or
otherwise, at least 90% of the then outstanding Shares, the Purchaser will be
able to approve and adopt the Merger Agreement and the transactions contemplated
thereby, including the Merger, without a vote of the Company's stockholders. In
such event, Laidlaw and the Purchaser shall take all necessary and appropriate
action to cause the Merger to become effective as soon as practicable after such
acquisition, without a meeting of the Company's stockholders. If, however, the
Purchaser does not acquire at least 90% of the then outstanding Shares pursuant
to the Offer or otherwise, and a vote of the Company's stockholders is required
under Delaware Law, a longer period of time will be required to effect the
Merger. See Section 11.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION AND SHOULD BE READ CAREFULLY AND IN THEIR ENTIRETY BEFORE
ANY DECISION IS MADE WITH RESPECT TO THE OFFER.
2
<PAGE>
THE OFFER
SECTION 1. TERMS OF THE OFFER; EXPIRATION DATE. Upon the terms and subject
to the conditions of the Offer (including, if the Offer is extended or amended,
the terms and conditions of such extension or amendment), the Purchaser will
accept for payment and pay for all Shares validly tendered on or prior to the
Expiration Date and not properly withdrawn as permitted by Section 4 below. For
purposes of the Offer, the term "Expiration Date" means 12:00 midnight, New York
City time, on Friday, February 7, 1997, unless and until the Purchaser, in its
sole discretion (subject to the terms of the Merger Agreement), shall have
extended the period of time during which the Offer is open, in which event the
term "Expiration Date" shall mean the latest time and date at which the Offer,
as so extended by the Purchaser, shall expire.
The Offer is conditioned upon, among other things, satisfaction of the
Minimum Condition and the expiration or termination of all waiting periods
imposed by the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended,
and the regulations thereunder (the "HSR Act"). The Offer is also subject to
certain other conditions set forth in Section 14 below. If these or any of the
other conditions referred to in Section 14 are not satisfied or any events
specified in Section 14 have occurred or are determined by the Purchaser to have
occurred prior to the Expiration Date, the Purchaser reserves the right (but is
not obligated) (i) to decline to purchase any of the Shares tendered in the
Offer, terminate the Offer and return all tendered Shares to the tendering
stockholders, (ii) to waive or amend any or all conditions to the Offer, to the
extent permitted by applicable law and the provisions of the Merger Agreement,
and, subject to complying with applicable rules and regulations of the
Securities and Exchange Commission (the "Commission"), purchase all Shares
validly tendered, (iii) to extend the Offer and, subject to the right of
stockholders to withdraw Shares until the Expiration Date, retain the Shares
which have been tendered during the period or periods for which the Offer is
extended or (iv) to delay acceptance for payment or payment for Shares, subject
to applicable law, until satisfaction or waiver of the conditions to the Offer.
In the event that the Purchaser waives any of the conditions set forth in
Section 14, the Commission may, if the waiver is deemed to constitute a material
change to the information previously provided to the stockholders, require that
the Offer remain open for an additional period of time and/or that the Purchaser
disseminate information concerning such waiver.
The Purchaser shall, subject to the conditions specified in Section 14,
accept for payment and pay for Shares which have been validly tendered and not
withdrawn pursuant to the Offer as soon as it is permitted to do so under
applicable law; provided that, if the number of Shares that have been validly
tendered and not withdrawn represent less than 90% of the Company's outstanding
voting power (calculated assuming the exercise of all outstanding options to
purchase shares of Common Stock the holders of which have not entered into an
agreement to cancel such options as described in the Merger Agreement and the
conversion of the Notes), the Purchaser may extend the Offer up to the tenth
business day following the date on which all conditions to the Offer shall first
have been satisfied or waived. If all of the conditions specified in Section 14
are not satisfied on the initial Expiration Date, the Purchaser shall extend
(and re-extend) the Offer through April 15, 1997, to provide time to satisfy
such conditions; provided that, if the Purchaser shall not have purchased the
Shares pursuant to the Offer prior to April 15, 1997, as the result of the
receipt by the Company of an Acquisition Proposal (as defined in Section 11) or
as a result of a failure of the applicable waiting period under the HSR Act to
expire or the failure to obtain any necessary governmental or regulatory
approvals, but all other conditions shall have been satisfied, the Purchaser
shall extend (and re-extend) the Offer through July 15, 1997. During any such
extension, all Shares previously tendered and not withdrawn will remain subject
to the Offer, subject to the rights of a tendering stockholder to withdraw its
Shares. See Section 4.
The Merger Agreement provides that the Purchaser may modify the terms of the
Offer except that, without the written approval of the Company, the Purchaser
will not decrease the price per Share paid in the Offer, change the form of
consideration payable in the Offer, reduce the maximum number of Shares to be
purchased in the Offer, or impose conditions to the Offer other than those set
forth herein.
3
<PAGE>
Subject to the applicable regulations of the Commission, the Purchaser also
reserves the right, in its sole discretion, at any time and from time to time,
(i) to delay acceptance for payment of or, regardless of whether such Shares
were theretofore accepted for payment, payment for, any Shares pending receipt
of any regulatory approval specified in Section 15 below or in order to comply
in whole or in part with any other applicable law, (ii) to terminate the Offer
(whether or not any Shares have theretofore been accepted for payment) if any of
the conditions referred to in Section 14 has not been satisfied or upon the
occurrence of any of the events specified in Section 14 and (iii) to waive any
condition (other than the Minimum Condition, which may not be waived without the
prior written consent of the Company) or otherwise amend the Offer in any
respect in any manner that is not prohibited as described above, in each case by
giving oral or written notice of such delay, termination, waiver or amendment to
the Depositary and by making a public announcement thereof. The Purchaser
acknowledges that (i) Rule 14e-1(c) under the Securities Exchange Act of 1934,
as amended (the "Exchange Act"), requires the Purchaser to pay the consideration
offered or return the Shares tendered promptly after the termination or
withdrawal of the Offer and (ii) the Purchaser may not delay acceptance for
payment of, or payment for (except as provided in clause (i) of the preceding
sentence), any Shares upon the occurrence of any of the conditions specified in
Section 14 without extending the period of time during which the Offer is open.
Any such extension, delay, termination, waiver or amendment will be followed
as promptly as practicable by public announcement thereof, with such
announcement in the case of an extension to be made no later than 9:00 a.m., New
York City time, on the next business day after the previously scheduled
Expiration Date. Except as provided by applicable law (including Rules 14d-4(c),
14d-6(d) and 14e-1 under the Exchange Act, which require that material changes
be promptly disseminated to stockholders in a manner reasonably designed to
inform them of such changes) and without limiting the manner in which the
Purchaser may choose to make any public announcement, the Purchaser shall have
no obligation to publish, advertise or otherwise communicate any such public
announcement other than by issuing a press release to the Dow Jones News
Service.
If the Purchaser makes a material change in the terms of the Offer or if it
waives a material condition of the Offer, the Purchaser will extend the Offer to
the extent required by Rules 14d-4(c), 14d-6(d) and 14e-1 under the Exchange
Act. The minimum period during which an offer must remain open following
material changes in the terms of the offer, other than a change in price or a
change in the percentage of securities sought, will depend upon the facts and
circumstances, including the materiality, of the changes. With respect to a
change in price or, subject to certain limitations, a change in the percentage
of securities sought, a minimum ten business day period from the day of such
change is generally required to allow for adequate dissemination to
stockholders. Accordingly, if prior to the Expiration Date the Purchaser
decreases the number of Shares being sought or increases or decreases the
consideration offered pursuant to the Offer, and if the Offer is scheduled to
expire at any time earlier than the period ending on the tenth business day from
the date that notice of such increase or decrease is first published, sent or
given to stockholders, then the Offer will be extended at least until the
expiration of such ten business day period. For purposes of the Offer, a
"business day" means any day other than a Saturday, Sunday or a federal holiday
and consists of the time period from 12:01 a.m. through 12:00 Midnight, New York
City time.
The Company has provided the Purchaser with the Company's stockholder list
and security position listings for the purpose of disseminating the Offer to
holders of Shares. This Offer to Purchase, the related 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, for subsequent
transmittal to beneficial owners of Shares, to brokers, dealers, commercial
banks, trust companies and similar persons whose names, or the names of whose
nominees, appear on the stockholder list or, if applicable, who are listed as
participants in a clearing agency's security position listing.
SECTION 2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES. Upon the terms
and subject to the conditions of the Offer (including, if the Offer is extended
or amended, the terms and conditions of any such extension or amendment), the
Purchaser will accept for payment and will pay for all Shares validly
4
<PAGE>
tendered and not properly withdrawn on or prior to the Expiration Date promptly
after the later to occur of (i) the Expiration Date and (ii) the satisfaction or
waiver of the conditions of the Offer set forth in Section 14, including,
without limitation, the expiration or termination of the waiting period
applicable to the acquisition of Shares pursuant to the Offer under the HSR Act.
In addition, subject to applicable rules of the Commission, the Purchaser
expressly reserves the right to delay acceptance for payment of, or payment for,
Shares pending receipt of any other regulatory approvals specified in Section
15.
Laidlaw intends to file on the date hereof with the Federal Trade Commission
(the "FTC") and the Antitrust Division of the Department of Justice (the
"Antitrust Division") a Pre-merger Notification and Report Form under the HSR
Act with respect to the Offer. Accordingly, the waiting period under the HSR Act
applicable to the Offer would expire at 11:59 p.m., New York City time, 15 days
after the filing date, unless prior to the expiration or termination of the
waiting period the FTC or the Antitrust Division extends the waiting period by
requesting additional information or documentary material from Laidlaw. If such
a request is made, the waiting period applicable to the Offer will expire on the
tenth calendar day after the date of substantial compliance by Laidlaw with such
request. Thereafter, the waiting period may be extended by court order or by
consent of Laidlaw. The waiting period under the HSR Act may be terminated by
the FTC and the Antitrust Division prior to its expiration. See Section 15.
In all cases, payment for Shares tendered and accepted for payment pursuant
to the Offer will be made only after timely receipt by the Depositary of (i) the
certificates evidencing such Shares (the "Share Certificates"), or timely
confirmation (a "Book-Entry Confirmation") of a book-entry transfer of such
Shares, if such procedure is available, into the Depositary's account at The
Depository Trust Company or the Philadelphia Depository Trust Company (each a
"Book-Entry Transfer Facility" and, collectively, the "Book-Entry Transfer
Facilities") pursuant to the procedures set forth in Section 3, (ii) the Letter
of Transmittal (or a facsimile thereof), properly completed and duly executed
with any required signature guarantees, or an Agent's Message (as defined below)
in connection with a book-entry transfer, and (iii) any other documents required
by the Letter of Transmittal.
The term "Agent's Message" means a message from a Book-Entry Transfer
Facility transmitted to, and received by, the Depositary forming a part of a
Book-Entry Confirmation, which states that (i) the Book-Entry Transfer Facility
has received an express acknowledgment from the participant in the Book-Entry
Transfer Facility tendering the Shares that are the subject of the Book-Entry
Confirmation, (ii) the participant has received and agrees to be bound by the
terms of the Letter of Transmittal and (iii) the Purchaser may enforce such
agreement against the participant.
For purposes of the Offer, the Purchaser will be deemed to have accepted for
payment (and thereby purchased) Shares validly tendered and not properly
withdrawn if, as and when the Purchaser gives oral or written notice to the
Depositary of the Purchaser's acceptance of such Shares for payment pursuant to
the Offer. Upon the terms and subject to the conditions of the Offer, payment
for Shares accepted for payment pursuant to the Offer will be made by deposit of
the purchase price therefor with the Depositary, which will act as agent for
tendering stockholders for the purpose of receiving payments from the Purchaser
and transmitting those payments to stockholders whose Shares have been accepted
for payment. UNDER NO CIRCUMSTANCES WILL INTEREST ON THE PURCHASE PRICE FOR
SHARES BE PAID, REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY DELAY IN MAKING
SUCH PAYMENT. If for any reason whatsoever acceptance for payment of or payment
for any Shares tendered pursuant to the Offer is delayed or the Purchaser is
unable to accept for payment or pay for Shares tendered pursuant to the Offer,
then, without prejudice to the Purchaser's rights set forth herein, the
Depositary may nevertheless, on behalf of the Purchaser, retain tendered Shares,
and those Shares may not be withdrawn except to the extent that the tendering
stockholder is entitled to exercise and duly exercises withdrawal rights as
described in Section 4, subject, however, to the Purchaser's obligation under
Rule 14e-1(c) under the Exchange Act to pay for Shares tendered or return those
Shares promptly after termination or withdrawal of the Offer.
5
<PAGE>
If any tendered Shares are not accepted for payment for any reason or if
Share Certificates are submitted for more Shares than are tendered, Share
Certificates evidencing unpurchased or untendered Shares will be returned (or,
in the case of Shares tendered by book-entry transfer into the Depositary's
account at a Book-Entry Transfer Facility pursuant to the procedures set forth
in Section 3, such Shares will be credited to an account maintained at such
Book-Entry Transfer Facility), without expense to the tendering stockholder, as
promptly as practicable following the expiration, termination or withdrawal of
the Offer.
IF, PRIOR TO THE EXPIRATION DATE, THE PURCHASER INCREASES THE CONSIDERATION
OFFERED TO STOCKHOLDERS PURSUANT TO THE OFFER, SUCH INCREASED CONSIDERATION WILL
BE PAID TO ALL STOCKHOLDERS WHOSE SHARES ARE PURCHASED PURSUANT TO THE OFFER,
REGARDLESS OF WHETHER THOSE SHARES WERE TENDERED PRIOR TO THE INCREASE IN
CONSIDERATION.
The Purchaser reserves the right to transfer or assign, in whole at any time
or in part from time to time, to one or more of the Purchaser's affiliates, the
right to purchase all or any portion of the Shares tendered pursuant to the
Offer, but any such transfer or assignment will not relieve the Purchaser of its
obligations under the Offer or prejudice the rights of tendering stockholders to
receive payment for Shares validly tendered and accepted for payment pursuant to
the Offer.
SECTION 3. PROCEDURE FOR TENDERING SHARES.
VALID TENDER. Except as set forth below, in order for Shares to be validly
tendered pursuant to the Offer, (i) the Letter of Transmittal (or a facsimile
thereof), properly completed and duly executed with any required signature
guarantees, or an Agent's Message in connection with a book-entry delivery of
Shares, and any other documents required by the Letter of Transmittal, must be
received by the Depositary at one of its addresses set forth on the back cover
of this Offer to Purchase on or prior to the Expiration Date, and (ii) either
(a) Share Certificates evidencing tendered Shares must be received by the
Depositary at such address, or the Shares must be tendered pursuant to the
procedure for book-entry transfer described below and a Book-Entry Confirmation
must be received by the Depositary, in each case on or prior to the Expiration
Date, or (b) the tendering stockholder must comply with the guaranteed delivery
procedures described below.
If Share Certificates are forwarded separately to the Depositary, a properly
completed and duly executed Letter of Transmittal (or a facsimile thereof) must
accompany each delivery.
BOOK-ENTRY TRANSFER. The Depositary will establish an account with respect
to the Shares at the Book-Entry Transfer Facilities for purposes of the Offer
within two business days after the date of this Offer to Purchase. Any financial
institution that is a participant in the system of any Book-Entry Transfer
Facility may make book-entry delivery of Shares by causing the Book-Entry
Transfer Facility to transfer such Shares into the Depositary's account at the
Book-Entry Transfer Facility in accordance with such Book-Entry Transfer
Facility's transfer procedures. However, although delivery of Shares may be
effected through book-entry transfer at a Book-Entry Transfer Facility, a Letter
of Transmittal (or a facsimile thereof), properly completed and duly executed
with any required signature guarantees, or an Agent's Message in connection with
a book-entry transfer, and any other documents required by the Letter of
Transmittal, must in any case be received by the Depositary at one of its
addresses set forth on the back cover of this Offer to Purchase on or prior to
the Expiration Date, or the tendering stockholder must comply with the
guaranteed delivery procedures described below.
DELIVERY OF DOCUMENTS TO A BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH
THE BOOK-ENTRY TRANSFER FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO
THE DEPOSITARY.
SIGNATURE GUARANTEES. Signatures on Letters of Transmittal must be
guaranteed by a firm which is a bank, broker, dealer, credit union, savings
association or other entity which is a member in good standing of a recognized
Medallion Signature Guarantee Program or by any other "eligible guarantor
institution,"
6
<PAGE>
as defined in Rule 17A(b)-15 under the Exchange Act (each of the foregoing, an
"Eligible Institution"), unless the Shares tendered thereby are tendered (i) by
a registered holder of Shares who has not completed either the box labeled
"Special Payment Instructions" or the box labeled "Special Delivery
Instructions" on the Letter of Transmittal or (ii) for the account of an
Eligible Institution. See Instruction 1 of the Letter of Transmittal.
If a Share Certificate is registered in the name of a person other than the
person who signs the Letter of Transmittal, or if payment is to be made, or a
Share Certificate not accepted for payment or not tendered is to be returned, to
a person other than the registered holder(s), the Share Certificate must be
endorsed or accompanied by appropriate stock powers, in either case signed
exactly as the name(s) of the registered holder(s) appears on the Share
Certificate, with the signature(s) on such Share Certificate or stock powers
guaranteed as provided above. See Instructions 1 and 5 of the Letter of
Transmittal.
GUARANTEED DELIVERY. If a stockholder desires to tender Shares pursuant to
the Offer and such stockholder's Share Certificates are not immediately
available, time will not permit all required documents to reach the Depositary
on or prior to the Expiration Date, or a stockholder cannot complete the
procedure for delivery by book-entry transfer on a timely basis, then such
stockholder's Shares may nevertheless be tendered, provided that all of the
following conditions are satisfied:
(i) the tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form provided by the Purchaser herewith, is
received by the Depositary as provided below on or prior to the Expiration
Date; and
(iii) the Share Certificates evidencing all tendered Shares, in proper
form for transfer, or a Book-Entry Confirmation, together with the Letter of
Transmittal (or a facsimile thereof) properly completed and duly executed
with any required signature guarantees (or, in the case of a book-entry
transfer, an Agent's Message) and any other documents required by the Letter
of Transmittal, are received by the Depositary within five New York Stock
Exchange, Inc. ("NYSE") trading days after the date of execution of the
Notice of Guaranteed Delivery.
The Notice of Guaranteed Delivery may be delivered by hand or transmitted by
telegram, facsimile transmission or mail to the Depositary and must include a
guarantee by an Eligible Institution and a representation that the stockholder
owns the Shares tendered within the meaning of, and that the tender of the
Shares effected thereby complies with, Rule 14e-4 under the Exchange Act, each
in the form set forth in the Notice of Guaranteed Delivery.
Notwithstanding any other provision hereof, payment for Shares accepted for
payment pursuant to the Offer will in all cases be made only after timely
receipt by the Depositary of (i) Share Certificates evidencing such Shares or a
Book-Entry Confirmation of the delivery of such Shares (if available), (ii) a
properly completed and duly executed Letter of Transmittal (or a facsimile
thereof) or, in the case of a book-entry transfer, an Agent's Message, and (ii)
any other documents required by the Letter of Transmittal. Accordingly, payment
may not be made to all tendering stockholders at the same time and will depend
upon when Share Certificates are received by the Depositary or Book-Entry
Confirmations of tendered Shares are received in the Depositary's account at a
Book-Entry Transfer Facility.
THE METHOD OF DELIVERY OF SHARE CERTIFICATES AND ALL OTHER REQUIRED
DOCUMENTS, INCLUDING THROUGH ANY BOOK-ENTRY TRANSFER FACILITY, IS AT THE OPTION
AND RISK OF THE TENDERING STOCKHOLDER AND THE DELIVERY WILL BE DEEMED MADE ONLY
WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF DELIVERY IS BY MAIL, REGISTERED
MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL
CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
DETERMINATION OF VALIDITY. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance for payment of any tender
of Shares pursuant to any of the procedures described above will
7
<PAGE>
be determined by the Purchaser, in its sole discretion, which determination
shall be final and binding on all parties. The Purchaser reserves the absolute
right to reject any and all tenders determined by it not to be in proper form or
the acceptance for payment of which may, in the opinion of its counsel, be
unlawful. The Purchaser also reserves the absolute right to waive any defect or
irregularity in any tender of Shares of any particular stockholder, whether or
not similar defects or irregularities are waived in the case of other
stockholders. No tender of Shares will be deemed to have been validly made until
all defects and irregularities have been cured or waived.
None of the Purchaser, Laidlaw, any of their affiliates or assigns, the
Depositary, the Information Agent or any other person will be under any duty to
give notification of any defects or irregularities in tenders or incur any
liability for failure to give any such notification. The Purchaser's
interpretation of the terms and conditions of the Offer (including the Letter of
Transmittal and the instructions thereto) will be final and binding.
APPOINTMENT AS PROXY. By executing a Letter of Transmittal as set forth
above, a tendering stockholder irrevocably appoints the Purchaser, its officers
and its designees, and each of them, as the stockholder's attorneys-in-fact and
proxies, with full power of substitution, in the manner set forth in the Letter
of Transmittal, to the full extent of such stockholder's rights with respect to
the Shares tendered by such stockholder and accepted for payment by the
Purchaser (and with respect to any and all other Shares or other securities
issued or issuable in respect of the Shares on or after January 6, 1997). All
such powers of attorney and proxies shall be considered irrevocable and coupled
with an interest in the tendered Shares. Such appointment will be effective if,
when and only to the extent that, the Purchaser accepts such Shares for payment.
Upon such acceptance for payment, all prior powers of attorney and proxies given
by the stockholder with respect to the Shares (and such other Shares and
securities) will, without further action, be revoked, and no subsequent powers
of attorney, proxies or written consents may be given or executed (and if given
or executed will not be deemed effective with respect thereto by the
stockholder). The Purchaser, its officers and its designees will, with respect
to the Shares (and such other Shares and securities) for which such appointment
is effective, be empowered to exercise all voting and other rights of the
stockholder as they in their sole discretion may deem proper at any annual or
special meeting of the Company's stockholders or any adjournment or postponement
thereof, by written consent in lieu of any such meeting or otherwise. The
Purchaser reserves the right to require that, in order for Shares 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 other securities, including voting at any meeting of stockholders.
BACKUP FEDERAL INCOME TAX WITHHOLDING AND SUBSTITUTE FORM W-9. Under the
"backup withholding" provisions of federal income tax law, the Depositary may be
required to withhold 31% of the amount of any payments of cash pursuant to the
Offer. In order to avoid backup withholding, each stockholder surrendering
Shares in the Offer to the extent not previously provided must provide the payor
of such cash with the stockholder's correct taxpayer identification number
("TIN") on a Substitute Form W-9 and certify under penalties of perjury that
such TIN is correct and that the stockholder is not subject to backup
withholding. Certain stockholders (including, among others, all corporations and
certain foreign individuals and entities) are not subject to backup withholding.
If a stockholder does not provide its correct TIN or fails to provide the
certifications described above, the Internal Revenue Service ("IRS") may impose
a penalty on the stockholder and payment of cash to the stockholder pursuant to
the Offer may be subject to backup withholding. All stockholders surrendering
Shares pursuant to the Offer should complete and sign the Substitute Form W-9
included in the Letter of Transmittal to provide the information and
certification necessary to avoid backup withholding (unless an applicable
exemption exists and is proved in a manner satisfactory to the Depositary).
Non-corporate foreign stockholders should complete and sign a Form W-8,
Certificate of Foreign Status (a copy of which may be obtained from the
Depositary), in order to avoid backup withholding. See Instruction 9 of the
Letter of Transmittal.
8
<PAGE>
OTHER REQUIREMENTS. The Purchaser's acceptance for payment of Shares
tendered pursuant to any of the procedures described above will constitute a
binding agreement between the tendering stockholder and the Purchaser upon the
terms and subject to the conditions of the Offer, including the tendering
stockholder's representation and warranty that such stockholder is the owner of
the Shares within the meaning of, and that the tender of the Shares complies
with, Rule 14e-4 under the Exchange Act.
SECTION 4. WITHDRAWAL RIGHTS. Tenders of Shares made pursuant to the Offer
are irrevocable, except that Shares tendered pursuant to the Offer may be
withdrawn at any time on or prior to the Expiration Date and unless already
accepted for payment by the Purchaser pursuant to the Offer, may also be
withdrawn at any time after March 10, 1997. If the Purchaser extends the Offer,
is delayed in its acceptance for payment of Shares or is unable to purchase
Shares validly tendered pursuant to the Offer for any reason, then, without
prejudice to the Purchaser's rights under the Offer, tendered Shares may be
retained by the Depositary on behalf of the Purchaser, and may not be withdrawn
except to the extent that tendering stockholders are entitled to withdrawal
rights as set forth in this Section 4; subject, however, to the Purchaser's
obligation, pursuant to Rule 14e-1(c) under the Exchange Act, to pay for the
tendered Shares or return those Shares promptly after termination or withdrawal
of the Offer. Any such delay will be accompanied by an extension of the Offer to
the extent required by law.
For a withdrawal to be effective, a written, telegraphic or facsimile
transmission notice of withdrawal must be timely received by the Depositary at
one of its addresses set forth on the back cover of this Offer to Purchase. Any
notice of withdrawal must specify the name of the person who tendered the Shares
to be withdrawn, the number of Shares to be withdrawn and the name of the
registered holder, if different from that of the person who tendered such
Shares. If Share Certificates evidencing Shares to be withdrawn have been
delivered or otherwise identified to the Depositary, then, prior to the physical
release of such Share Certificates, the serial numbers shown on such Share
Certificates must be submitted to the Depositary and the signature(s) on the
notice of withdrawal must be guaranteed by an Eligible Institution, unless such
Shares have been tendered for the account of an Eligible Institution. If Shares
have been tendered pursuant to the procedure for book-entry transfer as set
forth in Section 3, any notice of withdrawal must specify the name and number of
the account at the Book-Entry Transfer Facility to be credited with the
withdrawn Shares.
All questions as to the form and validity (including time of receipt) of any
notice of withdrawal will be determined by the Purchaser, in its sole
discretion, whose determination will be final and binding. None of the
Purchaser, Laidlaw, any of their affiliates or assigns, the Depositary, the
Information Agent or any other person will be under any duty to give
notification of any defects or irregularities in any notice of withdrawal or
incur any liability for failure to give any such notification.
Withdrawals of Shares may not be rescinded. Any Shares properly withdrawn
will thereafter be deemed not to have been validly tendered for purposes of the
Offer. However, withdrawn Shares may be re-tendered at any time prior to the
Expiration Date by following one of the procedures described in Section 3.
SECTION 5. CERTAIN U.S. FEDERAL INCOME TAX MATTERS. The summary of tax
consequences set forth below is for general information only and is based on the
law as currently in effect. The tax treatment of each stockholder will depend in
part upon such stockholder's particular situation. Special tax consequences not
described herein may be applicable to particular classes of taxpayers, such as
financial institutions, broker-dealers, persons who are not citizens or
residents of the United States, stockholders who acquired their Shares through
the exercise of an employee stock option or otherwise as compensation and
persons who received payments in respect of options to acquire Shares. ALL
STOCKHOLDERS SHOULD CONSULT WITH THEIR OWN TAX ADVISORS AS TO THE PARTICULAR TAX
CONSEQUENCES OF THE OFFER AND THE MERGER TO THEM, INCLUDING THE APPLICABILITY
AND EFFECT OF THE ALTERNATIVE MINIMUM TAX AND ANY STATE, LOCAL OR FOREIGN INCOME
AND OTHER TAX LAWS AND CHANGES IN SUCH TAX LAWS.
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<PAGE>
The receipt of cash pursuant to the Offer or the Merger will be a taxable
transaction for federal income tax purposes under the Internal Revenue Code of
1986, as amended, and may also be a taxable transaction under applicable state,
local, foreign income or other tax laws. Generally, a tendering stockholder will
recognize gain or loss in an amount equal to the difference between the cash
received by the stockholder pursuant to the Offer or the Merger and the
stockholder's adjusted tax basis in the Shares tendered and purchased pursuant
to the Offer or the Merger. Gain or loss is computed separately for each block
of Shares (Shares which were purchased at the same time and price) sold. For
federal income tax purposes, such gain or loss will be a capital gain or loss if
the Shares are a capital asset in the hands of the stockholder, and a long-term
capital gain or loss if the stockholder's holding period is more than one year
as of the date the Purchaser accepts such Shares for payment pursuant to the
Offer or the effective date of the Merger, as the case may be. There are
significant limitations on the deductibility of capital losses by individuals or
corporations. Capital losses can offset capital gains on a dollar-for-dollar
basis and, in the case of an individual stockholder, capital losses in excess of
capital gains can be deducted to the extent of $3,000 annually. An individual
can carry forward unused capital losses indefinitely. A corporation can utilize
capital losses only to offset capital gain income; a corporation's unused
capital losses can be carried back three years and forward five years.
Under present law, long-term capital gains recognized in 1997 are taxable at
a maximum rate of 28% for individuals and 35% for corporations, whereas ordinary
income is taxable at a maximum rate of 39.6% for individuals and 35% for
corporations.
SECTION 6. PRICE RANGE OF SHARES; DIVIDENDS. The Shares are traded in the
NYSE under the symbol "EMT." At January 8, 1997 there were 928 holders of
record. Based on information provided by the Company, the following table sets
forth, for the quarters indicated, the high and low sales price per Share in
each such period. The sale prices per Share set forth below are as reported in
published financial sources and do not include commissions.
<TABLE>
<CAPTION>
HIGH LOW
---------- ----------
<S> <C> <C>
Fiscal Year Ended December 31, 1994:
First Quarter............................................. $ 28 1/8 $ 23 1/8
Second Quarter............................................ 26 1/4 21 5/8
Third Quarter............................................. 26 1/4 21 1/2
Fourth Quarter............................................ 28 7/8 24 5/8
Fiscal Year Ended December 31, 1995:
First Quarter............................................. 28 3/4 24 5/8
Second Quarter............................................ 28 22 3/4
Third Quarter............................................. 31 5/8 27
Fourth Quarter............................................ 32 1/2 26 1/4
Fiscal Year Ended December 31, 1996:
First Quarter............................................. 35 1/4 28 7/8
Second Quarter............................................ 38 1/2 33 3/4
Third Quarter............................................. 38 1/4 32 5/8
Fourth Quarter............................................ 37 5/8 26 1/2
Fiscal Year Ending December 31, 1997
First Quarter (through January 8)......................... 39 1/2 32
</TABLE>
The Company has not paid any cash dividends since its formation.
On January 6, 1997, the last full day of trading prior to the public
announcement of the execution of the Merger Agreement, the reported closing sale
price per Share as reported on the NYSE was $33 5/8. On January 8, 1997, two
trading days prior to commencement of the Offer, the reported closing sale price
per
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share as reported on the NYSE was $39 3/8. STOCKHOLDERS ARE URGED TO OBTAIN A
CURRENT MARKET QUOTATION FOR THE SHARES.
SECTION 7. CERTAIN INFORMATION CONCERNING THE COMPANY.
GENERAL. The Company is a Delaware corporation with its headquarters
located at 2821 S. Parker Road, Aurora, Colorado. The Company is the leading
provider of emergency and non-emergency ambulance services in the United States.
FINANCIAL INFORMATION. Set forth below is certain selected financial
information with respect to the Company and its subsidiaries which has been
restated to the reflect the Company's acquisition of STAT Healthcare, Inc. in
December 1996 in a transaction accounted for as a pooling-of-interests.
AMERICAN MEDICAL RESPONSE, INC.
SELECTED CONSOLIDATED STATEMENTS OF EARNINGS
(IN THOUSANDS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
YEAR ENDED DECEMBER 31,
NINE MONTHS ENDED ----------------------------------
SEPTEMBER 30, 1996 1995 1994 1993
------------------ ---------- ---------- ----------
<S> <C> <C> <C> <C>
STATEMENT OF EARNINGS DATA:
Total revenue............................................ $ 528,299 $ 513,648 $ 336,667 $ 219,053
Pro forma earnings before income taxes................... 47,513 25,044 30,098 18,805
Pro forma net earnings................................... 26,582 13,356 16,875 10,552
PER SHARE DATA:
Primary earnings per common share........................ $ 1.09 $ 0.61 $ 0.88 $ 0.62
Fully diluted earnings per common share.................. $ 1.08 $ 0.61 $ 0.88 $ 0.62
Fully diluted weighted average number of common shares
outstanding (in thousands).............................. 27,219 22,046 19,101 16,929
BALANCE SHEET DATA:
Working capital.......................................... $ 76,030 $ 37,799 $ 30,672 $ 53,224
Total assets............................................. 606,623 486,956 241,683 141,973
Total indebtedness....................................... 188,212 117,355 52,757 7,817
Stockholders' equity..................................... 302,385 255,936 132,511 107,360
</TABLE>
AVAILABLE INFORMATION. The Shares are registered under the Exchange Act.
Accordingly, the Company is subject to the information and reporting
requirements of the Exchange Act and in accordance therewith is obligated to
file periodic reports, proxy statements and other information with the
Commission relating to its business, financial condition and other matters.
Information as of particular dates concerning the Company's directors and
officers, their remuneration, stock options granted to them, the principal
holders of the Company's securities and any material interest of such persons in
transactions with the Company is required to be disclosed in such proxy
statements and distributed to the Company's stockholders and filed with the
Commission. These reports, proxy statements and other information should be
available for inspection at the public reference facilities of the Commission
located in Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C. 20549, and
should also be available for inspection and copying at prescribed rates at the
regional offices of the Commission located at Citicorp Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661, and Seven World Trade Center, Suite
1300, New York, New York 10048. Copies of this material may also be obtained by
mail, upon payment of the Commission's customary fees, from the Commission's
principal office at 450 Fifth Street, N.W., Washington, D.C. 20549. In addition,
such material should also be available for inspection at American Medical
Response, Inc., 2821 South Parker Road, Suite 1000, Aurora, CO 80014.
11
<PAGE>
SECTION 8. CERTAIN INFORMATION CONCERNING THE PURCHASER AND LAIDLAW. The
Purchaser, a newly incorporated Delaware corporation and an indirect
wholly-owned subsidiary of Laidlaw, was organized in connection with the Offer
and has not carried on any activities to date other than in connection with the
Offer and the Merger Agreement. The principal executive office of the Purchaser
is located at 669 Airport Freeway, Suite 400, Hurst, Texas 76503, and the
telephone number at such office is (817) 282-7580. The principal executive
office of Laidlaw is located at 3221 North Service Road, Burlington, Ontario L7R
3Y8, and the telephone number at such office is (905) 336-1800.
Laidlaw is a provider of transportation and environmental services to
municipalities and industries throughout the United States and Canada.
PASSENGER SERVICES. Laidlaw provides passenger services, primarily under
the names Laidlaw Transit, Mayflower Contract Services and National School Bus
Services in the United States and Laidlaw Transit, Charterways and Grey Goose
Bus Lines in Canada, operating school buses and special education vehicles. In
August 1996, Laidlaw significantly expanded its passenger service operations
through the acquisition of Scott's Hospitality Inc. Laidlaw is the largest
school bus operator in North America, providing transportation for in excess of
1,940,000 students per day. Laidlaw also presently provides services to 205
municipal transit systems in the United States and Canada. Laidlaw is the
largest operator of paratransit services in the United States providing access
to transportation for elderly and physically and mentally challenged passengers.
Laidlaw also operates fixed-rate transit, scheduled daily passenger bus and
parcel express services. In addition, Laidlaw provides scheduled services under
private contract and package tours to major tourist regions in the United States
and Canada.
HEALTHCARE TRANSPORTATION. Laidlaw entered the healthcare transportation
business in 1993. During fiscal 1996, it significantly expanded its operations
through the acquisition of CareLine, Inc. and eight other businesses. Laidlaw is
the second largest provider of healthcare transportation services in the United
States operating from 71 locations in 23 states. These services consist of
critical care transportation services, non-emergency ambulance and transfer
services and emergency response services. Laidlaw enters into agreements with
municipal or county public safety agencies to provide performance-based
contracts for 9-1-1 response, joint training, shared staffing and stationing
arrangements and contracted dispatching. Laidlaw enters into contracts with
integrated healthcare delivery networks to provide turnkey managed healthcare
transportation systems. The Company also provides comprehensive on site medical
care and transport services for all types of special events.
HAZARDOUS WASTE SERVICES. Laidlaw provides hazardous waste services from 88
service locations in 26 states and seven Canadian provinces. These services are
conducted primarily under the name Laidlaw Environmental Services. On January 6,
1997, Laidlaw announced that it had signed a letter of intent to sell this
business to Rollins Environmental Services, Inc. ("Rollins"), in exchange for
cash, convertible debentures and 66% of the equity of Rollins. Upon the
completion of the transaction, which is anticipated to close in early April,
1997, Rollins will be renamed Laidlaw Environmental Services Inc. and continue
to be traded on the NYSE.
Laidlaw is subject to the information and reporting requirements of the
Exchange Act and in accordance therewith is obligated to file certain
information with the Commission relating to its business, financial condition
and other matters. Information as of particular dates concerning Laidlaw's
directors and officers, their remuneration, stock options granted to them, the
principal holders of Laidlaw's securities and any material interests of such
persons in transactions with Laidlaw is contained in that information. This
information may be inspected and copies may be obtained from the offices of the
Commission in the same manner as set forth with respect to information about the
Company in Section 7. Such information concerning the Company can be inspected
at the offices of The New York Stock Exchange, 20 Broad Street, New York, New
York 10005.
12
<PAGE>
Set forth below is certain selected consolidated financial information
relating to Laidlaw and its subsidiaries for Laidlaw's last three fiscal years,
which has been derived from the financial statements contained in Laidlaw's
Annual Report on Form 10-K for the fiscal year ended August 31, 1996, each filed
by Laidlaw with the Commission. More comprehensive financial information
(including management's discussion and analysis of financial condition and
results of operations) is included in the reports and other documents filed by
Laidlaw with the Commission. The following financial information is qualified in
its entirety by reference to such reports and other documents, including the
financial statements and related notes contained therein.
LAIDLAW INC.
SELECTED CONSOLIDATED FINANCIAL DATA
(IN U.S. $ MILLIONS, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
YEAR ENDED AUGUST 31,
----------------------------------
1996 1995 1994
---------- ---------- ----------
<S> <C> <C> <C>
INCOME STATEMENT DATA:
Revenue.................................................................... $ 2,296.0 $ 1,722.4 $ 1,378.1
Income from operations..................................................... 233.0 174.9 140.0
Income from continuing operations before income taxes...................... 147.4 95.9 66.8
Income from continuing operations.......................................... 117.2 74.9 48.8
Income from discontinued operations........................................ 44.6 57.9 42.0
Net income................................................................. 161.8 132.8 90.8
Earnings per share
Continuing operations.................................................... 0.40 0.27 0.18
Discontinued operations.................................................. 0.15 0.21 0.15
Net income per share....................................................... 0.55 0.48 0.33
<CAPTION>
AT AUGUST 31,
----------------------------------
1996 1995 1994
---------- ---------- ----------
<S> <C> <C> <C>
BALANCE SHEET DATA:
Cash & Short-Term.......................................................... $ 225.8 $ 146.5 $ 199.6
Current Assets............................................................. 773.5 579.3 468.6
Assets of discontinued operations.......................................... 828.0 744.8 733.8
Long-term investments...................................................... 168.5 587.5 742.6
Fixed assets............................................................... 1,949.8 1,650.4 1,219.2
Other assets............................................................... 1,212.5 572.8 339.8
Total Assets............................................................... 4,932.3 4,134.8 3,504.0
Current liabilities........................................................ 480.0 409.2 256.2
Deferred items............................................................. 386.2 362.3 264.1
Long-term debt............................................................. 1,929.3 1,665.9 1,397.8
Stockholders' Equity....................................................... 2,136.8 1,697.4 1,585.9
</TABLE>
The name, citizenship, business address, principal occupation or employment
and five year employment history of each of the directors and executive officers
of the Purchaser and Laidlaw are set forth in Schedule I to this Offer to
Purchase.
Except for 480,000 shares of Common Stock owned by a subsidiary of Laidlaw,
(i) none of the Purchaser, Laidlaw nor, to the best knowledge of the Purchaser
and Laidlaw, any of the persons listed on Schedule I or any associate or
wholly-owned or majority-owned subsidiary of the Purchaser, Laidlaw or any of
the persons so listed, beneficially owns or has a right to acquire directly or
indirectly any Shares, and
13
<PAGE>
(ii) none of the Purchaser, Laidlaw nor, to the best knowledge of the Purchaser
and Laidlaw, any of the persons or entities referred to above, or any of the
respective executive officers, directors or subsidiaries of any of the
foregoing, has effected any transactions in the Shares during the past sixty
(60) days.
Except as described in this Offer to Purchase, none of the Purchaser,
Laidlaw or, to the best knowledge of the Purchaser and Laidlaw, any of the
persons listed on Schedule I, has any contract, arrangement, understanding or
relationship with any other person with respect to any securities of the
Company, including but not limited to contracts, arrangements, understandings or
relationships concerning the transfer or voting of such securities, joint
ventures, loan or option arrangements, puts or calls, guarantees of loans,
guarantees against loss or the giving or withholding of proxies. Except as set
forth in this Offer to Purchase, since January 1, 1994, none of the Purchaser,
Laidlaw or, to the best knowledge of the Purchaser and Laidlaw, any of the
persons listed on Schedule I, has had any business relationships or transactions
with the Company or any of its executive officers, directors or affiliates that
are required to be reported under the rules and regulations of the Commission
applicable to the Offer. Except as set forth in this Offer to Purchase, since
January 1, 1994 there have been no contacts, negotiations or transactions
between any of Laidlaw, the Purchaser or, to the best knowledge of the Purchaser
and Laidlaw, any of the persons listed on Schedule I, on the one hand, and the
Company or its affiliates, on the other hand, concerning a merger, consolidation
or acquisition, a tender offer or other acquisition of securities, an election
of directors, or a sale or other transfer of a material amount of assets.
SECTION 9. SOURCE AND AMOUNT OF FUNDS. The total amount of funds required
by the Purchaser and Laidlaw to consummate the Offer and the Merger (including
the cash out of stock options as described in Section 11) and to pay related
fees and expenses (approximately $5 million) is estimated to be approximately
$1.2 billion. This amount includes the Notes, of which approximately $125
million are outstanding, which contain a "change in control" provision, and if
not converted by the holders, permit the holders to require the Company to
repurchase the Notes at par value plus accrued interest. The Company also has a
revolving credit facility which provides for a default upon a "change in
control." In the event any such debt is accelerated, the Purchaser and Laidlaw
will require additional funds to repay that debt.
The Purchaser will obtain all necessary funds through capital contributions
or advances to be made by Laidlaw. Laidlaw has sufficient funds available to it,
from cash on hand and from undrawn or available credit under its existing
revolving credit facilities and other sources, to fund fully all of its
requirements and the Purchaser's requirements in connection with the Offer and
the Merger. Laidlaw's existing credit facilities ("Facility") are each by and
among Laidlaw, as borrower, and a syndicate of financial institutions for which
Canadian Imperial Bank of Commerce acts as administrative agent. Laidlaw may
borrow up to an aggregate amount of $1.4 billion under the Facility for general
corporate purposes, including transactions contemplated by the Offer.
Laidlaw's ability to borrow under the Facility is conditioned on compliance
with certain covenants and satisfaction of certain other requirements. Laidlaw
is currently in compliance with these covenants and requirements and believes
that funds will be available prior to the time that funds are required to pay
for Shares tendered in the Offer.
Laidlaw anticipates that any indebtedness incurred through borrowings under
the Facility will be repaid from a variety of sources, which may include, but
may not be limited to, funds generated internally by Laidlaw and its affiliates
(including, following the Merger, funds generated by the Purchaser). No decision
has been made concerning the method Laidlaw will employ to repay such
indebtedness. Such decision will be made based on Laidlaw's review from time to
time of the advisability of particular actions, as well as on prevailing
interest rates and financial and other economic conditions and such other
factors as Laidlaw may deem appropriate.
THE OFFER IS NOT CONDITIONED UPON THE PURCHASER OBTAINING FINANCING.
14
<PAGE>
SECTION 10. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY.
On October 29, 1996, Paul T. Shirley, the President and Chief Executive
Officer of the Company, and James R. Bullock, the President and Chief Executive
Officer of Laidlaw, met in Denver, Colorado. The two had not previously met, and
the purpose of the meeting was to discuss generally the healthcare
transportation industry and its future. There was no discussion about a
potential transaction between the parties at that time. Subsequent to the
meeting in Denver, during the first week of November, 1996, Laidlaw engaged
Merrill Lynch & Co. to provide advice to it on a prospective transaction with
the Company. During the third week of November, 1996, Merrill Lynch reported to
Laidlaw on the results of its analysis of the publicly available information on
the Company. Thereafter, Laidlaw determined that it was in the best interests of
its stockholders to acquire Shares prior to any discussion with respect to a
potential transaction. 480,000 Shares were purchased by Laidlaw between November
21, 1996 and December 5, 1996 at an aggregated purchase price of $14.4 million.
In December, 1996, Mr. Bullock contacted Mr. Shirley and asked to meet
again. They met on December 13, 1996 in Denver, and Mr. Bullock advised Mr.
Shirley that Laidlaw had completed an extensive analysis of the Company and felt
that it was a good fit with Laidlaw's MedTrans business. Mr. Bullock told Mr.
Shirley that Laidlaw was interested in acquiring the Company. He suggested that
Laidlaw would be willing to make a cash offer or, if some or all of the
Company's stockholders wanted to receive Laidlaw securities, a combination of
cash and preferred stock. Mr. Bullock and Mr. Shirley discussed the
opportunities for the two combined businesses. Although Mr. Bullock suggested
that Mr. Shirley could have a role in the combined business, Mr. Shirley
deferred those discussions until after all other terms of the proposed
combination were fully determined. Mr. Bullock advised Mr. Shirley that
Laidlaw's analysis suggested that a fair price for the Company would be in the
range of $37.00 to $38.00 per share. Mr. Shirley suggested that a price closer
to $44.00 per share would be appropriate.
On December 16, 1996, the Company's Board of Directors held a special
meeting by conference telephone to discuss the negotiations with Laidlaw. At the
meeting, Mr. Shirley described his conversations with representatives of Laidlaw
and informed the Board that Laidlaw would possibly be willing to pay $40 per
share for the Company's outstanding shares. The Board instructed Mr. Shirley to
continue discussions with Laidlaw.
On December 16, 1996, Mr. Shirley advised Mr. Bullock that while there was a
genuine interest in pursuing a merger with Laidlaw, the purchase price would
need to be in the range of $42.00 to $44.00. Mr. Bullock advised Mr. Shirley
that the absolute "top price" Laidlaw was willing to pay was $40.00 per share.
On December 17 and 18, 1996, the Company's Board of Directors held special
meetings by conference telephone. At the meetings, Mr. Shirley informed the
Board as to the status of negotiations with Mr. Bullock. Mr. Shirley indicated
that he had been informed by Mr. Bullock $40.00 per share was the highest price
Laidlaw was willing to pay. The Board instructed Mr. Shirley to continue
discussions with Laidlaw. There were various conversations between Mr. Bullock
and Mr. Shirley in which they discussed their valuation issues and attempted to
agree upon a per share price. Ultimately these discussions led to an agreement
of $40.00 per share, subject to satisfactory resolution of the other significant
transaction issues.
Also as a result of this discussion between Mr. Bullock and Mr. Shirley,
Laidlaw and the Company entered into a confidentiality agreement on December 23,
1996. The confidentiality agreement also provided for a one-year standstill on
purchases of Company stock and similar transactions, with certain exceptions.
Pursuant to that confidentiality agreement Laidlaw and its advisors were
provided access to various due diligence materials and Laidlaw performed
diligence to confirm its prior analysis of the Company. On December 20, 1996,
counsel for the Company distributed a draft Agreement and Plan of Merger to
Laidlaw.
On January 3, 1997, the Company's Board of Directors met at a special
meeting. At the meeting, the Board received presentations from management and
from the Company's legal and financial advisors. The Company's management
reviewed the status of negotiations with Laidlaw with respect to the proposed
15
<PAGE>
transaction. Ropes & Gray, counsel to the Company, reviewed the Board's
fiduciary duties, and Smith Barney presented its analysis of the proposed
consideration to be received by the Company's stockholders. Ropes & Gray also
reviewed the terms and conditions of the proposed Agreement and Plan of Merger.
Following the presentations of the Board, management and the Company's advisors
discussed the proposed transaction.
In the evening of January 5, 1997, after completion of the negotiations over
the proposed Agreement and Plan of Merger, the Board of Directors of the Company
held a special meeting by conference phone to review, with the advice and
assistance of the Company's financial and legal advisors, the proposed Agreement
and Plan of Merger, and the transaction contemplated thereby, including the
Offer and the Merger. At the meeting, Mr. Shirley described the outcome to the
Board of the final negotiations with Laidlaw with respect to the substantive
terms of the proposed Agreement and Plan of Merger. Smith Barney updated its
analysis presented to the Board at the January 3 meeting of the Board and
delivered its oral opinion to the Board (which was subsequently confirmed by
delivery of a written opinion dated January 6, 1997) to the effect that, as of
such date and based upon and subject to certain matters stated in such opinion,
the cash consideration of $40.00 per share to be received by holders of shares
(other than Laidlaw and its affiliates) in the Offer and the Merger, taken
together, was fair, from a financial point of view, to such holders. Following a
number of questions from, and discussions among, the directors, the Company's
Board of Directors (i) approved the Merger Agreement and the transactions
contemplated thereby and authorized the execution and delivery thereof, (ii)
determined that the Offer and the Merger, taken together, are fair to, and in
the best interests of, the Company and its stockholders, and (iii) recommended
that the Company's stockholders accept the Offer and tender their shares to
Purchaser.
During the period from December 30, 1996, through January 6, 1997, the
Company and Laidlaw negotiated the Merger Agreement and the terms of the Offer.
The Board of Directors of Laidlaw approved the transaction on January 6,
1997, and the Board of Directors of the Company, after discussing the
transaction on several occasions, approved the transaction on January 5, 1997.
On Sunday, January 5, 1997, representatives of the Company and Laidlaw
completed their negotiations of all substantive terms of the Merger Agreement.
On January 5, 1997, the Board of Directors of the Company met and approved the
Offer, the Merger Agreement and related matters. On January 6, 1997, the Boards
of Directors of Laidlaw and Purchaser also took the steps required under the
corporate and securities laws to approve the Offer, the Merger and the Merger
Agreement. Laidlaw, the Purchaser and the Company executed the Merger Agreement
in the afternoon on January 6, 1997. On January 6, 1997, after the closing of
trading, Laidlaw and the Company separately announced the transaction. On
January 10, 1997, Purchaser commenced the Offer.
To the extent any of the foregoing background information describes events
to which Laidlaw was not a party, it is based upon information provided by the
Company.
16
<PAGE>
The purchases of Shares by Laidlaw as described above, were all made in open
market transactions and consisted of the following:
<TABLE>
<CAPTION>
TRADE DATE SHARES PRICE
- ---------------------- --------- ---------
<S> <C> <C>
November 21, 1996 25,000 $ 29.375
November 21, 1996 5,200 29.250
November 25, 1996 29,800 29.875
November 26, 1996 29,600 30.000
November 26, 1996 10,400 29.875
November 27, 1996 150,000 30.000
November 27, 1996 2,700 29.875
November 29, 1996 27,300 30.000
November 29, 1996 11,200 29.875
December 2, 1996 42,600 30.000
December 2, 1996 36,200 29.875
December 4, 1996 65,000 30.000
December 4, 1996 5,000 29.875
December 4, 1996 5,000 29.750
December 4, 1996 5,000 29.625
December 5, 1996 15,200 29.750
December 5, 1996 10,000 29.625
December 5, 1996 4,800 29.500
</TABLE>
SECTION 11. PURPOSE OF THE OFFER; MERGER AGREEMENT; PLANS FOR THE COMPANY.
PURPOSE OF THE OFFER. The purpose of the Offer, the Merger and the Merger
Agreement is to enable Laidlaw to acquire control of the entire equity interest
of the Company. Upon consummation of the Merger, the Company will become an
indirect wholly-owned subsidiary of Laidlaw. The Offer is being made pursuant to
the Merger Agreement.
MERGER AGREEMENT. The following is a summary of certain provisions of the
Merger Agreement. The summary is qualified in its entirety by reference to the
Merger Agreement, which is incorporated herein by reference and a copy of which
has been filed with the Commission as an exhibit to Laidlaw's Tender Offer
Statement on Schedule 14D-1 (the "Schedule 14D-1"). In particular, when the term
material adverse effect is used herein it has the meaning as defined in the
Merger Agreement. The Merger Agreement may be examined and copies may be
obtained at the place and in the manner set forth in Section 7 of this Offer to
Purchase.
THE OFFER. The Merger Agreement provides that the Purchaser will commence
the Offer and that, upon the terms and subject to the prior satisfaction or
waiver of the conditions of the Offer, the Purchaser will purchase all Shares
validly tendered pursuant to the Offer. The Merger Agreement provides that the
Purchaser may in its sole discretion waive, in whole or in part, at any time or
from time to time, any condition (other than the Minimum Condition, which may
not be waived without the prior written consent of the Company), increase the
price per Share payable in the Offer or make any other changes in the terms and
conditions of the Offer; provided that, unless previously approved by the
Company in writing, no change may be made that decreases the price per Share
payable in the Offer, changes the form of consideration payable in the Offer,
reduces the maximum number of Shares to be purchased in the Offer or imposes
conditions to the Offer in addition to those set forth herein. The Company has
informed the
17
<PAGE>
Purchaser that as of December 31, 1996, there were 21,047,345 Shares issued and
outstanding, 1,999,180 shares of Common Stock reserved for issuance under the
Company's stock option plans and agreements and stock purchase plan, 3,311,258
shares of Common Stock reserved for issuance upon conversion of the Notes, and
3,919,900 shares of Common Stock issuable in connection with the acquistion of
STAT Healthcare, Inc., and that, except as otherwise disclosed in the Merger
Agreement, no other stock of the Company is outstanding or committed to be
issued. Based on this information and assuming all holders of outstanding
options to purchase shares of Common Stock will have entered into agreements to
cancel such options on or prior to the date Purchaser purchases the Shares
pursuant to the Offer, the Purchaser believes that the Minimum Condition will be
satisfied if the Purchaser acquires at least 18,852,335 Shares in the Offer.
Laidlaw directly or indirectly holds 480,000 shares. These Shares will not be
tendered but will count toward the satisfaction of the Minimum Condition.
Certain other conditions to the Offer are described in Section 14. The Purchaser
expressly reserves the right to waive any one or more of the conditions to the
Offer, although the Minimum Condition cannot be waived without the consent of
the Company.
THE MERGER. The Merger Agreement provides that, subject to the terms and
conditions thereof, and in accordance with Delaware Law, the Purchaser shall be
merged with and into the Company as soon as practicable after satisfaction or
waiver of the conditions set forth in the Merger Agreement (the "Effective
Time"). The Merger shall become effective upon the filing of a Certificate of
Merger with the Secretary of State of the State of Delaware (or such later date
as is specified in the Certificate of Merger). As a result of the Merger, the
separate corporate existence of the Purchaser will cease and the Company will
continue as the surviving corporation (the "Surviving Corporation"). In the
Merger, each issued and outstanding Share (other than Shares owned directly or
indirectly by Laidlaw or any of its subsidiaries or by the Company as treasury
stock, and other than Shares owned by stockholders who have properly exercised
rights of appraisal under Delaware Law) will be converted into the right to
receive $40.00 per Share, without interest, and each issued and outstanding
share of common stock of the Purchaser will be converted into one fully paid and
non-assessable share of common stock of the Surviving Corporation (which will
constitute the only issued and outstanding capital stock of the Surviving
Corporation).
The Merger Agreement provides that the certificate of incorporation and
by-laws of the Purchaser at the Effective Time will be the certificate of
incorporation and by-laws of the Surviving Corporation until amended in
accordance with applicable law. The Merger Agreement also provides that the
directors of the Purchaser at the Effective Time will be the directors of the
Surviving Corporation, and the officers of the Purchaser at the Effective Time
will be the officers of the Surviving Corporation.
THE COMPANY'S BOARD OF DIRECTORS. The Merger Agreement provides that,
commencing upon the purchase of Shares pursuant to the Offer, and from time to
time thereafter, Purchaser will be entitled to designate such number of
directors, rounded up to the next whole number, on the Board of Directors of the
Company as will give Purchaser representation on the Board equal to the product
of (i) the total number of directors on the Board and (ii) the percentage that
the number of Shares owned by the Purchaser and its affiliates (including Shares
purchased pursuant to the Offer) bears to the total number of outstanding
Shares, and the Company has agreed, upon request of the Purchaser, promptly
either to increase the size of the Board (and, if necessary, amend the Company's
by-laws to permit such an increase) or to use its reasonable best efforts to
secure the resignations of such number of directors as is necessary to enable
the Purchaser's designees to be elected to the Board and to cause the
Purchaser's designees to be so elected. The Merger Agreement also provides that
following the election or appointment of Purchaser's designees to the Company's
Board of Directors any amendment of the Merger Agreement or any amendment to the
Restated Certificate of Incorporation or Bylaws of the Company inconsistent with
the Merger Agreement, any termination of the Merger Agreement by the Company,
any extension of time for performance of any of the obligations or other acts of
Laidlaw or Purchaser or any waiver of any of the Company's rights under the
Merger Agreement will require the concurrence of a majority of the directors of
the Company then in office who are not designees of the Purchaser or employees
of the Company. The
18
<PAGE>
Company's obligation to appoint the Purchaser's designees to the Board of
Directors is subject to Section 14(f) of the Exchange Act and Rule 14f-1
promulgated thereunder.
STOCKHOLDERS MEETING. Pursuant to the Merger Agreement, the Company will,
if required by applicable law in order to consummate the Merger, duly call and
hold a special meeting of its stockholders (the "Special Meeting") as promptly
as practicable following the acceptance for payment and purchase of Shares by
the Purchaser pursuant to the Offer for the purpose of voting upon the Merger
Agreement, the Merger and related matters. The Board shall recommend approval
and adoption of the Merger Agreement by the Company's stockholders.
INTERIM OPERATIONS. In the Merger Agreement, the Company has agreed that,
except as otherwise agreed in writing by Laidlaw, prior to the time Purchaser's
designees are elected as directors, the businesses of the Company and its
subsidiaries shall be conducted only in the ordinary course of business
consistent with past practice, the Company will use its reasonable commercial
efforts to preserve substantially intact its business organization, keep
available the services of the present officers, employees and consultants of the
Company and its subsidiaries, and preserve the present relationships of the
Company and it subsidiaries with customers, suppliers, and other persons with
which the Company or any of its subsidiaries has significant business relations.
In addition, except as expressly contemplated by the Merger Agreement or without
the prior written consent of Laidlaw, each of the Company and its subsidiaries
will not:
(a) amend or otherwise change the Certificate of Incorporation or
By-Laws of the Company or any of its subsidiaries;
(b) issue, sell, pledge, dispose of or encumber, or authorize the
issuance, sale, pledge, disposition or encumbrance of, any shares of capital
stock of any class of the Company or any of the Company's subsidiaries, or
any options, warrants, convertible securities or other rights of any kind to
acquire any shares of capital stock, or any other ownership interest
(including, without limitation, any phantom interest) in the Company or any
of its subsidiaries or affiliates (except for (i) the issuance of shares of
Company Common Stock issuable pursuant to certain stock options; (ii) the
grant of options under the Company's stock option plans consistent with past
practice to purchase up to 50,000 shares of Company Common Stock at the
market value on the date of grant to newly hired employees (excluding
executive officers), and the issuance of shares upon exercise thereof, (iii)
the issuance of shares of Company Common Stock issuable upon conversion of
the Notes, (iv) the issuance of shares of Company Common Stock issuable to
participants in the Company's Employee Stock Purchase Plan pursuant to the
terms thereof, (v) the issuance of shares of Company Common Stock at not
less than the fair market value thereof in connection with certain permitted
acquisitions, and (vi) the issuance of shares of Company Common Stock to
former holders of shares of capital stock of STAT Healthcare, Inc.);
(c) sell, pledge, dispose of or encumber any assets of the Company or
any of its subsidiaries (except for (i) sales of assets in the ordinary
course of business and in a manner consistent with past practice, (ii)
disposition of obsolete or worthless assets, (iii) sales of immaterial
assets not in excess of $500,000, and (iv) encumbrances on assets to secure
purchase money financings of equipment and capital improvements and in
connection with the financing of permitted acquisitions);
(d) (i)declare, set aside, make or pay any dividend or other
distribution (whether in cash, stock or property or any combination thereof)
in respect of any of its capital stock, except that a wholly-owned
subsidiary of the Company may declare and pay a dividend or make advances to
its parent or the Company, (ii) split, combine or reclassify any of its
capital stock or issue or authorize or propose the issuance of any other
securities in respect of, in lieu of or in substitution for shares of its
capital stock, or (iii) amend the terms or change the period of
exercisability of, purchase, repurchase, redeem or otherwise acquire, or
permit any subsidiary to purchase, repurchase, redeem or otherwise acquire,
any of its securities or any securities of its subsidiaries, including,
without limitation, shares of Company
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Stock or any option, warrant or right, directly or indirectly, to acquire
shares of Company Common Stock, or propose to do any of the foregoing;
except for the acceleration of options pursuant to the terms of the Company
stock option plans and the net exercise of such options and the repurchase
of Notes as required by the terms thereof;
(e) (i)acquire (by merger, consolidation, or acquisition of stock or
assets) any corporation, partnership or other business organization or
division thereof other than (A) those approved in the Merger Agreement and
(B) ambulance service providers and other health care providers in the
continental United States and Hawaii, whether acquired solely for cash,
promissory notes that are subordinated as required by the Company's lenders,
or Company Common Stock issued at fair market value, or any combination
thereof, provided that the total consideration paid for all such
acquisitions described in this clause (B) consummated prior to March 31,
1997 shall not exceed $50 million and the total consideration paid for all
such acquisitions described in this clause (B) consummated prior to July 15,
1997 shall not exceed $100 million; (ii) incur any indebtedness for borrowed
money or issue any debt securities or assume, guarantee or endorse or
otherwise as an accommodation become responsible for, the obligations of any
person or, except in the ordinary course of business consistent with past
practice or in connection with purchases of equipment or capital
improvements or in permitted acquisitions, make any loans or advances (other
than loans or advances to or from direct or indirect wholly owned
subsidiaries), (iii) enter into or amend any material contract or agreement
other than in the ordinary course of business or where such contract or
amendment would not have a material adverse effect; (iv) authorize any
capital expenditures or purchase of fixed assets which are, in the
aggregate, in excess of the amounts approved in the Merger Agreement; or (v)
enter into or amend any contract, agreement, commitment or arrangement to
effect any of the matters prohibited by this provision;
(f) except as approved in the Merger Agreement, increase the
compensation payable or to become payable to its officers or employees,
except for increases in salary or wages of employees of the Company or its
subsidiaries in accordance with past practice and in amounts that are in the
aggregate reflected in the budgets previously provided to Laidlaw or, except
in the ordinary course of business, grant any severance or termination pay
to, or enter into any employment or severance agreement with any director,
officer or other employee of the Company or any of its subsidiaries, or
establish, adopt, enter into or amend any collective bargaining, bonus,
profit sharing, thrift, compensation, stock option, restricted stock,
pension, retirement, deferred compensation, employment, termination,
severance or other plan, agreement, trust, fund, policy or arrangement for
the benefit of any current or former directors, officers or employees,
except, in each case, as may be required by law;
(g) take any action to change accounting policies or procedures
(including, without limitation, procedures with respect to revenue
recognition, payments of accounts payable and collection of accounts
receivable);
(h) make any material tax election inconsistent with past practice or
settle or compromise any material federal, state, local or foreign tax
liability or agree to an extension of a statute of limitations, except to
the extent the amount of any such settlement has been reserved for in the
financial statements contained in the Company's SEC reports filed prior to
the date of the Merger Agreement;
(i) pay, discharge or satisfy any claims, liabilities or obligations
(absolute, accrued, asserted or unasserted, contingent or otherwise), other
than the payment, discharge or satisfaction in the ordinary course of
business and consistent with past practice of liabilities reflected or
reserved against in the financial statements contained in the Company's SEC
reports filed prior to the date of the Merger Agreement or incurred in the
ordinary course of business and consistent with past practice; or
(j) take, or agree in writing or otherwise to take, any of the actions
described above, or any action which would make any of the representations
or warranties of the Company contained in the
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Merger Agreement untrue or incorrect or prevent the Company from performing
or cause the Company not to perform its covenants under the Merger
Agreement.
NO SOLICITATION. In the Merger Agreement, the Company has agreed not to
directly or indirectly, through any officer, director, employee, representative
or agent of the Company or any of its subsidiaries, (i) solicit, initiate or
encourage the initiation of any inquiries or proposals regarding any merger,
sale of substantial assets, sale of shares of capital stock (including without
limitation by way of a tender offer, but not in connection with permitted
acquisitions) or similar transactions involving the Company or any subsidiaries
of the Company other than the Merger (any of the foregoing inquiries or
proposals being referred to herein as an "Acquisition Proposal"), (ii) engage in
negotiations or discussions concerning, or provide any nonpublic information to
any person relating to, any Acquisition Proposal or (iii) agree to approve or
recommend any Acquisition Proposal. Nothing contained in the Merger Agreement
prevents the Board of Directors of the Company from considering, negotiating,
approving and recommending to the stockholders of the Company, or under certain
circumstances providing nonpublic information with respect to, a bona fide
Acquisition Proposal not solicited in violation of the Merger Agreement,
provided the Board of Directors of the Company determines in good faith (upon
written advice of independent counsel) that it is required to do so in order to
discharge properly its fiduciary duties.
DIRECTORS' AND OFFICERS' INSURANCE; INDEMNIFICATION. For a period of five
years after the Effective Time, Laidlaw has agreed to cause the Surviving
Corporation to maintain in effect, if available, directors' and officers'
liability insurance covering those persons who are currently covered by the
Company's directors' and officers' liability insurance policy on terms
(including the amounts of coverage and the amounts of deductibles, if any) that
are comparable to the terms now applicable to directors and officers of Laidlaw,
or, if more favorable to the Company's directors and officers, the terms now
applicable to them under the Company's current policies; PROVIDED, HOWEVER, that
in no event shall Laidlaw or the Surviving Corporation be required to expend in
excess of 300% of the annual premium currently paid by the Company for such
coverage; and PROVIDED FURTHER, that if the premium for such coverage exceeds
such amount, Laidlaw or the Surviving Corporation shall purchase a policy with
the greatest coverage available for such 300% of the annual premium.
The Merger Agreement provides that the Certificate of Incorporation and
By-Laws of the Surviving Corporation shall contain the provisions with respect
to indemnification and exculpation set forth in the Certificate of Incorporation
and By-Laws of the Company, which provisions shall not be amended, repealed or
otherwise modified for a period of three years from the Effective Time in any
manner that would adversely affect the rights thereunder of individuals who at
the Effective Time were directors, officers, employees or agents of the Company,
unless such modification is required by law. In addition, the Merger Agreement
provides that the Company shall, to the fullest extent permitted under
applicable law or under the Company's Certificate of Incorporation or By-Laws
and regardless of whether the Merger becomes effective, indemnify and hold
harmless, and, after the Effective Time, the Surviving Corporation shall, to the
fullest extent permitted under applicable law or under the Surviving
Corporation's Certificate of Incorporation or By-Laws, indemnify and hold
harmless, each present and former director, officer or employee of the Company
or any of its subsidiaries against any costs or expenses (including attorneys'
fees), judgments, fines, losses, claims, damages and liabilities incurred in
connection with, and amounts paid in settlement of, any claim, action, suit,
proceeding or investigation, whether civil, criminal, administrative or
investigative and wherever asserted, bought or filed, (x) arising out of or
pertaining to the transactions contemplated by the Merger Agreement or (y)
otherwise with respect to any acts or omissions or alleged acts or omissions
occurring at or prior to the Effective Time, to the same extent as provided in
the respective Certificate of Incorporation or By-Laws of the Company or the
subsidiaries or any applicable contract or agreement as in effect on the date
hereof, in each case for a period of three years after the date hereof.
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EMPLOYMENT AGREEMENTS. David C. Colby, Executive Vice President, Chief
Financial Officer, Treasurer and Director of the Company, and George B. DeHuff,
Executive Vice President and Chief Operating Officer of the Company, have each
entered into an agreement with the Company and Laidlaw relating to his
employment with the Company following consummation of the Offer. Under the terms
of these agreements, as an inducement to remain in their respective positions
with the Company following the Offer and the Merger, Messrs. Colby and DeHuff
will each be paid an amount ($841,500 in the case of Mr. Colby and $817,000 in
the case of Mr. DeHuff) on August 31, 1997 if he is still employed by the
Company on that date, provided that if he is terminated without cause (as
defined in the Company's Executive Separation Allowance Plan (the "Separation
Plan")) prior to August 31, 1997 or if he terminates his employment following
the occurrence of certain specified events he will receive such amount upon such
termination and will be entitled to receive certain specified benefits. In
addition, the agreements amend the respective employment agreements with Messrs.
Colby and DeHuff effective upon consummation of the Offer to (i) increase the
annual base salary of each of Messrs. Colby and DeHuff to $325,000, (ii) provide
that each is eligible for an annual performance bonus with a target of 50% of
his base salary, based on quantitative and qualitative performance factors to be
established by the Company, and that he will participate in any other bonus
program that Laidlaw or the Company makes available for senior executives of the
Company, (iii) amend the provisions relating to severance benefits to be
provided under his existing employment agreements to provide that in the event
that he is terminated without cause by the Company or by him for Good Reason (as
defined in the employment agreements) he will be entitled to receive his cash
compensation earned to the date of termination plus the greater of the pro rata
portion of his target bonus for the preceding twelve months or the pro rata
portion of 50% of his then current base salary, and, in respect of any other
bonus plan in which he is then participating, an amount that reflects his
achievement of any performance goals under such plan to the date of termination.
The agreements also provide that each of Messrs. Colby and DeHuff will be
granted, effective January 6, 1997, the date the Merger Agreement was executed,
an option to purchase 30,000 shares of Laidlaw's Class B Nonvoting Shares at an
exercise price equal to the closing price of the shares on January 3, 1997, the
date preceding the date on which the Merger Agreement was executed and will be
granted, in May 1997, an option to purchase an additional 30,000 shares of
Laidlaw's Class B Nonvoting Shares at an exercise price equal to the fair market
value of such shares on the date of grant. Such options will vest in five equal
annual installments commencing on the first anniversary of the date of grant.
Under the agreements, effective upon consummation of the Offer, each of Messrs.
Colby and DeHuff waives his rights under the Separation Plan, except as
otherwise provided in the agreement with respect to continuation of certain
employee benefits following termination of the executive's employment with the
Company without cause or for Good Reason prior to August 31, 1997.
COMPANY STOCK OPTIONS. On the date Purchaser purchases Shares pursuant to
the Offer, each outstanding option to purchase Company Common Stock (a "Company
Stock Option"), whether or not exercisable, shall become exercisable and each
holder of a Company Stock Option who executes an agreement to cancel such
Company Stock Option shall be entitled to receive from the Company, in
consideration for such cancellation, an amount in cash (less applicable
withholding taxes) equal to the product of (i) the number of shares previously
subject to such Company Stock Option multiplied by (ii) the excess, if any, of
the Per Share Amount over the exercise price per share of the Company Common
Stock previously subject to such Company Stock Option. Each Company Stock Option
that is not so canceled will expire upon the Merger.
EMPLOYEE STOCK PURCHASE PLAN. On the date Purchaser purchases Shares
pursuant to the Offer, all rights under the Company's 1992 Employee Stock
Purchase Plan with respect to amounts previously deducted shall be accelerated
and shall be exercised automatically for shares of Company Common Stock as if
January 6, 1997 were the end of an "Option Period" (as defined in the Plan)
unless a participant withdraws from the Plan. Payroll deductions under the Plan
not used to purchase shares will be returned to the participants.
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<PAGE>
CONDITIONS TO THE MERGER. The Merger Agreement provides that the respective
obligations of the Company, Laidlaw and the Purchaser to consummate the Merger
are subject to the satisfaction of the following conditions: (i) the Purchaser
shall have purchased shares pursuant to the Offer; (ii) any waiting period
applicable to the consummation of the Merger under the HSR Act shall have
expired or been terminated; (iii) no temporary restraining order, preliminary or
permanent injunction or other order or other legal restraint or prohibition
preventing the consummation of the Merger shall be in effect, nor shall any
proceeding brought by any governmental authority seeking any of the foregoing be
pending; and there shall not be any action taken, or any statute, rule,
regulation or order enacted, entered, enforced or deemed applicable to the
Merger which makes the consummation of the Merger illegal; and (iv) there shall
not have been instituted, pending or threatened any action or proceeding (or any
investigation or other inquiry that might result in such an action or
proceeding) by any governmental authority, nor shall there be in effect any
judgment, decree or order seeking to prohibit or limit Laidlaw from exercising
all material rights and privileges pertaining to its ownership of the Surviving
Corporation or the ownership or operation by Laidlaw or any of its subsidiaries
of all or a material portion of the business or assets of Laidlaw or any of its
subsidiaries, or seeking to compel Laidlaw or any of its subsidiaries to dispose
of or hold separate all or any material portion of the business or assets of
Laidlaw or any of its subsidiaries (including the Surviving Corporation and its
subsidiaries), as a result of the Merger or the transactions contemplated by the
Merger Agreement.
REPRESENTATIONS AND WARRANTIES. In the Merger Agreement, the Company has
made customary representations and warranties to Laidlaw and the Purchaser with
respect to, among other things, its organization, capitalization, financial
statements, public filings, labor relations, employee benefit plans, insurance,
compliance with laws, litigation, environmental matters, tax matters,
intellectual property, consents and approvals and undisclosed liabilities.
TERMINATION; FEES. The Merger Agreement may be terminated and the
transaction abandoned at any time prior to the Effective Time, notwithstanding
the approval by the stockholders of the Company, (i) by mutual written consent
of the Company, the Purchaser and Laidlaw; (ii) by either Laidlaw or the Company
if a court of competent jurisdiction or governmental, regulatory or
administrative agency or commission shall have issued a nonappealable final
order, decree or ruling or taken any other action having the effect of
permanently restraining, enjoining or otherwise prohibiting the Merger (provided
that the right to terminate the Merger Agreement under this provision is not
available to any party who has not complied with its obligations and such
noncompliance materially contributed to the issuance of any such order, decree
or ruling or the taking of such action); (iii) by either Laidlaw or the Company
if the Purchaser shall have (A) terminated the Offer or (B) failed to accept for
purchase and pay for Shares pursuant to the Offer by April 15, 1997 unless the
Purchaser's actions are a result of the receipt by the Company of an Acquisition
Proposal or a request for additional information under the HSR Act or the
failure to obtain any necessary governmental or regulatory approval, in which
case if the Purchaser shall have failed to accept for purchase and pay for
Shares by July 15, 1997 (provided that the right to terminate the Merger
Agreement under this provision is not available to any party whose failure to
fulfill any obligation under the Merger Agreement has been the cause of or
resulted in any of the circumstances described in clauses (A) and (B) before
such date); or (iv) by Laidlaw or the Company, prior to the purchase of Shares
pursuant to the Offer, if the Board of Directors of the Company shall withdraw,
modify or change its approval or recommendation of the Offer, the Merger
Agreement or the Merger in a manner adverse to Laidlaw; (v) by Laidlaw or the
Company, prior to the purchase of Shares pursuant to the Offer, (A) if any
representation or warranty of the Company or Laidlaw, respectively, set forth in
the Merger Agreement shall be untrue when made, or (B) upon a breach in any
material respect of any covenant or agreement on the part of the Company or
Laidlaw, respectively, set forth in the Merger Agreement, in each case where
such untruth or breach would have a material adverse effect on the Company or
Laidlaw, as the case may be (either (A) or (B) above being a "Terminating
Breach"), PROVIDED, THAT, if such Terminating Breach is curable by the Company
or Laidlaw, as the case may be, through the exercise of its reasonable best
efforts and for so long as the Company or Laidlaw, as the case may be, continues
to exercise such reasonable best
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<PAGE>
efforts, neither Laidlaw nor the Company, respectively, may terminate the Merger
Agreement under this provision.
If the Merger Agreement is terminated by Laidlaw pursuant to its rights
described in clauses (iv) or (v) of the preceding paragraph, to compensate
Laidlaw and the Purchaser for entering into the Merger Agreement, their taking
action to consummate the transactions hereunder and incurring the costs and
expenses related thereto and other losses and expenses, including the foregoing
by Laidlaw of other opportunities, the Company will pay Laidlaw a fee of $17.5
million.
PLANS FOR THE COMPANY. Laidlaw intends, upon acquiring control of the
Company, to continue its review and evaluation of the Company and its
subsidiaries and their respective assets, businesses, corporate structure,
capitalization, operations, properties, policies, management and personnel.
Generally, Laidlaw intends to integrate the Company's business with
Laidlaw's existing operations, with a view to achieving operating efficiencies
and cost savings while maintaining and enhancing customer service. After Laidlaw
conducts its review of the Company, it is possible that Laidlaw might modify
some of its current plans.
SECTION 12. DIVIDENDS AND DISTRIBUTIONS. As described above, the Merger
Agreement provides that, prior to the Effective Time, the Company and each of
its subsidiaries will not declare, pay, set aside or make any dividend or other
distribution or payment with respect to, or split, combine, reclassify,
purchase, redeem or otherwise acquire any shares of its capital stock.
Pursuant to the provisions of the Merger Agreement the Company may not
issue, sell, pledge, dispose of or encumber, or authorize the issuance, sale,
pledge, disposition or encumbrance of, any shares of capital stock of any class,
or any options, warrants, convertible securities or other rights of any kind to
acquire any shares of capital stock, or any other ownership interest (including,
without limitation, any phantom interest) in the Company or any of its
subsidiaries or affiliates (except for (i) the issuance of shares of Company
Common Stock issuable pursuant to the Company Stock Options outstanding on the
date of the Merger Agreement, (ii) the grant of options under the Company's
stock option plans and agreements consistent with past practice to purchase up
to 50,000 shares of Company Common Stock at the market value on the date of
grant to newly hired employees (excluding executive officers), and the issuance
of shares upon exercise thereof, (iii) the issuance of shares of Company Common
Stock issuable to participants in the Company's Employee Stock Purchase Plan
pursuant to the terms thereof, (iv) the issuance of shares of Company Common
Stock at not less than the fair market value thereof in connection with
Permitted Acquisitions (as defined in Merger Agreement) and (v) the issuance of
shares of Company Common Stock to former holders of shares of capital stock of
STAT Healthcare, Inc.).
Pursuant to the Merger Agreement, the Company also may not (i) declare, set
aside, make or pay any dividend or other distribution (whether in cash, stock or
property or any combination thereof) in respect of any of its capital stock,
except that a wholly-owned subsidiary of the Company may declare and pay a
dividend or make advances to its parent or the Company, (ii) split, combine or
reclassify any of its capital stock or issue or authorize or propose the
issuance of any other securities in respect of, in lieu of or in substitution
for shares of its capital stock, or (iii) amend the terms or change the period
of exercisability of, purchase, repurchase, redeem or otherwise acquire, or
permit any subsidiary to purchase, repurchase, redeem or otherwise acquire, any
of its securities or any securities of its subsidiaries, including, without
limitation, shares of Company Common Stock or any option, warrant or right,
directly or indirectly, to acquire shares of Company Common Stock, or propose to
do any of the foregoing, except for the acceleration of options pursuant to the
terms of the Company Common stock option plans and agreements and the net
exercise of such options and the repurchase of Notes as required by the terms
thereof;
Pursuant to the terms of the Merger Agreement, the Company is prohibited
from taking any of the actions described in the preceding paragraphs, and
nothing herein shall constitute a waiver by the
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Purchaser or Laidlaw of any of its rights under the Merger Agreement or a
limitation of remedies available to the Purchaser or Laidlaw for any breach of
the Merger Agreement, including termination thereof.
SECTION 13. EFFECT OF THE OFFER ON THE MARKET FOR THE SHARES, NYSE LISTING
AND EXCHANGE ACT REGISTRATION. Depending upon the aggregate market value and
per Share price of any Shares not purchased pursuant to the Offer, following the
Offer the Shares may no longer meet the standards for continued listing on the
NYSE, which requires an issuer to have at least 600,000 publicly held shares by
1,200 or more holders of at least 100 shares with an aggregate market value of
at least $5,000,000. Shares held by directors and officers (or their immediate
families) of the Company and other concentrated holdings of 10% or more of the
Shares outstanding generally will not be considered to be publicly held for the
purpose of the foregoing standards. In the event that the Shares were no longer
quoted on NYSE, it is possible that the Shares could continue to trade in the
over-the-counter market and that quotations would continue to be reported
through other sources. The extent of the public market for the Shares and the
availability of such quotations would, however, depend upon the number of
stockholders remaining at such time, the interest in maintaining a market in the
Shares on the part of securities firms, the possible termination of registration
of the Shares under the Exchange Act, as described below, and other factors.
The Shares are currently registered under the Exchange Act. Such
registration of the Shares may be terminated upon application of the Company to
the Commission if the Shares are not listed on a national securities exchange or
quoted on Nasdaq National Market and there are fewer than 300 holders of record
of the Shares. Deregistration of the Shares under the Exchange Act would reduce
substantially the information required to be furnished by the Company to holders
of Shares and to the Commission and would render inapplicable certain of the
provisions of the Exchange Act, such as the short-swing profit recovery
provisions of Section 16(b), the requirement of Section 14(a) that the Company
furnish stockholders with proxy materials in connection with stockholders'
meetings and the requirements of Rule 13e-3 promulgated under the Exchange Act
with respect to "going private" transactions. Furthermore, "affiliates" of the
Company and persons holding "restricted securities" of the Company might be
deprived of the ability to dispose of Shares pursuant to Rule 144 or Rule 144A
promulgated under the Securities Act of 1933, as amended (the "Securities Act").
If registration of the Shares under the Exchange Act were terminated, the Shares
would no longer be "margin securities." It is the current intention of Laidlaw
to cause the Company to deregister the Shares after the consummation of the
Offer if the requirements for termination of registration are met.
The Shares currently are "margin securities" under the rules of the Board of
Governors of the Federal Reserve System (the "Federal Reserve Board"), which has
the effect, among other things, of allowing brokers to extend credit on the
collateral of the Shares. Depending upon factors similar to those described
above regarding listing and market quotations, it is possible that following the
Offer, the Shares would cease to constitute "margin securities" for the purpose
of the Federal Reserve Board's margin regulations and, therefore, could no
longer be used as collateral for margin loans made by brokers.
SECTION 14. CERTAIN CONDITIONS OF THE OFFER. Notwithstanding any other
provision of the Offer, and in addition to (and not in limitation of) the
Purchaser's rights to amend the Offer (subject to the terms of the Merger
Agreement), the Purchaser shall not be required to accept for payment or,
subject to any applicable rules and regulations of the SEC, including without
limitation Rule 14e-1(c) under the Exchange Act (relating to the Purchaser's
obligation to pay for or to return tendered Shares promptly after termination or
withdrawal of the Offer), pay for any Shares tendered pursuant to the Offer, and
may postpone the acceptance for payment or, subject to the restrictions referred
to above, payment for, any Shares tendered pursuant to the Offer, and may
terminate or amend the Offer and not accept for payment any Shares if (i) the
Minimum Condition shall not have been satisfied, or (ii) any applicable waiting
period under the HSR Act shall not have expired or been terminated, PROVIDED,
that prior to April 15, 1997, (or, if the conditions to the Offer have not been
satisfied prior to April 15, 1997 as a result of the receipt by the Company of
an Acquisition Proposal or as a result of a failure of the applicable waiting
period under the HSR Act to expire or the failure to obtain any necessary
governmental or regulatory approvals, prior to
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July 15, 1997) the Purchaser shall not terminate the Offer by reason of the
nonsatisfaction of any of the conditions and shall extend the Offer, or (iii)
Purchaser shall not have been reasonably satisfied that the provisions of
Section 203 of the Delaware General Corporation Law are inapplicable to the
Offer and Merger, or (iv) at any time on or after five days after announcement
and prior to the acceptance for payment of or payment of Shares, any of the
following conditions shall occur:
(a) there shall have been any action or proceeding brought by any
governmental authority before any court located or having jurisdiction
within the United States or Canada or any statute, regulation, legislation,
judgment or order, enacted, entered, enforced, promulgated, amended, issued
or deemed applicable to the Offer or the Merger by any court, governmental,
administrative or regulatory authority or agency located or having
jurisdiction within the United States or Canada that could result in a
material adverse effect and have the effect of: (i) making illegal, or
otherwise directly or indirectly restraining or prohibiting or imposing
material penalties or fines or requiring the payment of material damages in
connection with the making of, the Offer, the acceptance for payment of,
payment for, or ownership, directly or indirectly, of some of or all the
Shares by Laidlaw or the Purchaser, the consummation of the Offer or the
Merger; (ii) prohibiting or materially limiting the direct or indirect
ownership or operation by the Company or by Laidlaw of all or any material
portion of the business or assets of the Company and its subsidiaries, taken
as a whole, or compelling Laidlaw to dispose of or hold separate all or any
material portion of the business or assets of the Company and its
subsidiaries, taken as a whole, as a result of the transactions contemplated
by the Merger Agreement; (iii) imposing or confirming material limitations
on the ability of Laidlaw effectively to hold or to exercise full rights of
ownership of Shares, including, without limitation, the right to vote any
Shares on all matters properly presented to the stockholders of the Company;
or (iv) requiring divestiture by Laidlaw or the Purchaser, directly or
indirectly, of any Shares; or
(b) the Company shall have breached or failed to perform in any material
respect any of its covenants or agreements under the Merger Agreement or any
of the representations and warranties of the Company set forth in the Merger
Agreement shall not be true and correct both when made and as of the date of
consummation of the Offer (except to the extent such representations and
warranties of the Company address matters only as of a particular date, in
which case as of such date) except where the failure to perform such
covenants or agreements or the failure of such representation and warranties
to be so true and correct would not have a material adverse effect; or
(c) The Merger Agreement shall have been terminated in accordance with
its terms or the Offer shall have been amended or terminated with the
consent of the Company;
which in the reasonable judgment of the Purchaser in any such case, and
regardless of the circumstances (including any act or omission by the Purchaser
not inconsistent with the Merger Agreement) giving rise to such condition, makes
it inadvisable to proceed with such acceptance for payment or payment of Shares.
The foregoing conditions are for the sole benefit of the Purchaser and may
be asserted by the Purchaser regardless of the circumstances giving rise to any
such condition or may be waived by the Purchaser in whole or in part at any time
and from time to time in its sole discretion. The failure by the Purchaser at
any time to exercise any of the foregoing rights shall not be deemed a waiver of
any such right, the waiver of any such right with respect to particular facts
and other circumstances shall not be deemed a waiver with respect to any other
facts and circumstances, and each such right shall be deemed an ongoing right
that may be asserted at any time and from time to time.
A public announcement will be made of a material change in, or waiver of,
such conditions to the extent required by Rules 14d-4(c) and 14d-6(d) under the
Exchange Act, and the Offer will be extended in connection with any such change
or waiver to the extent required by such rules.
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SECTION 15. CERTAIN LEGAL MATTERS AND REGULATORY APPROVALS.
GENERAL. Except as otherwise disclosed herein, based upon an examination of
publicly available information filed by the Company with the Commission, neither
the Purchaser nor Laidlaw is aware of (i) any license or other regulatory permit
that appears to be material to the business of the Company and its subsidiaries,
taken as a whole, that might be adversely affected by the Purchaser's
acquisition of Shares (and the indirect acquisition of the stock of the
Company's subsidiaries) pursuant to the Offer or the Merger, or (ii) any
filings, approvals or other actions by or with any domestic (federal or state),
foreign or supranational governmental authority or administrative or regulatory
agency that would be required prior to the acquisition of Shares (or the
indirect acquisition of the stock of the Company's subsidiaries) by the
Purchaser as contemplated herein. Should any such approval or other action be
required, it is the Purchaser's present intention to seek such approval or
action. However, the Purchaser does not presently intend to delay the purchase
of Shares tendered pursuant to the Offer pending the receipt of any such
approval or the taking of any such action (subject to the Purchaser's right to
delay or decline to purchase Shares if any of the conditions in Section 14 shall
have occurred). There can be no assurance that any such approval or other
action, if needed, would be obtained without substantial conditions or that
adverse consequences might not result to the business of the Company, Laidlaw or
the Purchaser or that certain parts of the businesses of the Company, Laidlaw or
the Purchaser might not have to be disposed of or held separate or other
substantial conditions complied with in order to obtain such approval or other
action or, in the event that such approval was not obtained or such other action
was not taken, any of which could cause the Purchaser to elect to terminate the
Offer without the purchase of the Shares thereunder. The Purchaser's obligation
under the Offer to accept for payment and pay for Shares is subject to certain
conditions, including conditions relating to the legal matters discussed in this
Section 15. See Section 14.
STATE TAKEOVER LAWS. The Company is incorporated under the laws of the
State of Delaware. In general, Section 203 of the Delaware Law prevents an
"interested stockholder" (generally a person who owns or has the right to
acquire 15% or more of a corporation's outstanding voting stock, or an affiliate
or associate thereof) from engaging in a "business combination" (defined to
include mergers and certain other transactions) with a Delaware corporation for
a period of three (3) years following the date such person became an interested
stockholder unless, among other things, prior to such date the board of
directors of the corporation approved either the business combination or the
transaction in which the interested stockholder became an interested
stockholder. In connection with the review of the proposed transaction, the
Company's Board of Directors prior to the execution of the Merger Agreement (i)
approved and adopted the Merger Agreement and the transactions contemplated
thereby, (ii) determined that the Merger Agreement and the transactions
contemplated thereby, including each of the Offer and the Merger, are fair to,
and in the best interests of, the stockholders of the Company, and (iii)
recommended that the stockholders of the Company accept the Offer and approve
and adopt the Merger Agreement and the transactions contemplated thereby.
Accordingly, the Purchaser and Laidlaw believe that Section 203 of the Delaware
Law is inapplicable to the Merger Agreement, the Offer and the Merger because
its provisions have been satisfied.
A number of other states have also adopted takeover laws and regulations
which purport to varying degrees to be applicable to attempts to acquire
securities of corporations which are incorporated in such states or which have
or whose business operations have substantial economic effects in such states,
or which have substantial assets, security holders, principal executive offices
or principal places of business therein. To the extent that certain provisions
of certain of these state takeover statutes purport to apply to the Offer, the
Purchaser believes that such laws conflict with federal law and constitute an
unconstitutional burden on interstate commerce. In 1982, the Supreme Court of
the United States, in EDGAR V. MITE CORP., invalidated on constitutional grounds
the Illinois Business Takeovers Act, which, as a matter of state securities law,
made takeovers of corporations meeting certain requirements more difficult.
However, in 1987, in CTS CORP. V. DYNAMICS CORP. OF AMERICA, the Supreme Court
of the United States held that the State of Indiana could, as a matter of
corporate law and in particular those aspects of corporate law
27
<PAGE>
concerning corporate governance, constitutionally disqualify a potential
acquiror from voting on the affairs of a target corporation without the prior
approval of the remaining stockholders, provided that such laws were applicable
only under certain conditions. Subsequently, a number of federal courts have
ruled that various state takeover statutes were unconstitutional insofar as they
apply to corporations incorporated outside the state of enactment.
The Company, directly or through subsidiaries, conducts business in a number
of states throughout the United States, some of which have enacted takeover
laws. The Purchaser does not know whether any of these laws will, by their
terms, apply to the Offer or the Merger and has not taken any action to comply
with any such laws. Should any person seek to apply any state takeover law, the
Purchaser will take reasonable efforts to resist such application, which may
include challenging the validity or applicability of any such statute in
appropriate court proceedings. In the event it is asserted that one or more
state takeover laws is applicable to the Offer or the Merger, and an appropriate
court does not determine that it is inapplicable or invalid as applied to the
Offer, the Purchaser might be required to file certain information with, or
receive approvals from, the relevant state authorities. In addition, if
enjoined, the Purchaser might be unable to accept for payment or pay for any
Shares tendered pursuant to the Offer or be delayed in continuing or
consummating the Offer and the Merger. In such case, the Purchaser may not be
obligated to accept for payment, or pay for, any Shares tendered. See Section
14.
SHORT-FORM MERGER. Delaware Law would permit the Merger to occur without a
vote of the Company's stockholders (a "short-form merger") if the Purchaser were
to acquire at least 90% of the outstanding Shares. If, however, the Purchaser
does not acquire at least 90% of the then outstanding Shares pursuant to the
Offer or otherwise, and a vote of the Company's stockholders is required under
Delaware Law, a longer period of time will be required to effect the Merger.
APPRAISAL RIGHTS. No appraisal rights are available in connection with the
Offer. However, if the Merger is consummated, stockholders of the Company would
have certain rights to dissent and demand appraisal of their Shares under
Section 262 of Delaware Law. Dissenting stockholders who comply with the
requisite statutory procedures under Delaware Law would be entitled to a
judicial determination and payment of the "fair value" of their Shares as of the
close of business on the day prior to the date of stockholder authorization of
the Merger, together with interest thereon, at such rate as the court finds
equitable, from the date the Merger is consummated until the date of payment.
Under Delaware Law, in fixing the fair value of the Shares, a court would
consider the nature of the transaction giving rise to the stockholders' right to
receive payment for Shares and its effects on the Company and its stockholders,
the concepts and methods then customary in the relevant securities and financial
markets for determining fair value of shares of a corporation engaging in a
similar transaction under comparable circumstances, and all other relevant
factors.
The foregoing summary of the rights of objecting stockholders does not
purport to be a complete statement of the procedures to be followed by
stockholders desiring to exercise any available dissenters' rights. The
preservation and exercise of dissenters' rights require strict adherence to the
applicable provisions of Delaware Law.
ANTITRUST. Under the HSR Act and the rules that have been promulgated
thereunder by the FTC, certain acquisition transactions may not be consummated
unless certain information has been furnished to the Antitrust Division and the
FTC and certain waiting period requirements have been satisfied. The acquisition
of Shares by the Purchaser pursuant to the Offer is subject to the HSR Act
requirements. See Section 2.
Under the provisions of the HSR Act applicable to the purchase of Shares
pursuant to the Offer, such purchase may not be made until the expiration of a
15-calendar day waiting period following the required filing of a Pre-merger
Notification and Report Form under the HSR Act by Laidlaw, which Laidlaw intends
to submit on the date hereof. Accordingly, the waiting period under the HSR Act
would expire at
28
<PAGE>
11:59 p.m., New York City time, 15 days after the filing date, unless early
termination of the waiting period were granted or Laidlaw received a request
from the Antitrust Division or the FTC for additional information or documentary
material prior thereto. If such a request were made, the waiting period
applicable to the Offer will expire on the tenth calendar day after the date of
substantial compliance by Laidlaw with such request. Thereafter, the waiting
period may be extended by court order or by consent of Laidlaw. Although the
Company is required to file certain information and documentary material with
the Antitrust Division and the FTC in connection with the Offer, neither the
Company's failure to make such filings nor a request to the Company from the
Antitrust Division or the FTC for additional information or documentary material
will extend the waiting period.
The waiting period under the HSR Act may be terminated by the FTC and the
Antitrust Division prior to its expiration. Accordingly, pursuant to the HSR Act
each of Laidlaw and the Company intend to request early termination of the
waiting period applicable to the Offer. There can be no assurance, however, that
the 15-day HSR Act waiting period will be terminated early. Shares will not be
accepted for payment or paid for pursuant to the Offer until the expiration or
earlier termination of the applicable waiting period under the HSR Act. See
Section 2. Subject to Section 4, any extension of the waiting period will not
give rise to any withdrawal rights not otherwise provided for by applicable law.
If the Purchaser's acquisition of Shares is delayed due to a request by the
Antitrust Division or the FTC for additional information or documentary material
pursuant to the HSR Act and all other conditions to the Offer have been
satisfied, the Offer will be extended (and re-extended) until at least July 15,
1997, and may, with the consent of Laidlaw, the Purchaser and the Company, be
extended beyond that date.
No separate HSR Act requirements with respect to the Merger or the Merger
Agreement will apply if the 15-day waiting period relating to the Offer (as
described above) has expired or been terminated. However, if the Offer is
withdrawn or if the filing relating to the Offer is withdrawn prior to the
expiration or termination of the 15-day waiting period relating to the Offer,
the Merger may not be consummated until 30 calendar days after receipt by the
Antitrust Division and the FTC of the Pre-merger Notification and Report Forms
of both Laidlaw and the Company, unless the 30-day period is earlier terminated
by the Antitrust Division and the FTC. Within such 30-day period, the Antitrust
Division or the FTC may request additional information or documentary materials
from Laidlaw and/or the Company, in which event, the acquisition of Shares
pursuant to the Merger may not be consummated until twenty (20) days after both
Laidlaw and the Company substantially comply with such requests. Thereafter, the
waiting periods may be extended only by court order or by consent.
The FTC and the Antitrust Division frequently scrutinize the legality under
the antitrust laws of transactions such as the proposed acquisition of Shares by
the Purchaser pursuant to the Offer. At any time before or after the purchase by
the Purchaser of Shares pursuant to the Offer, either the FTC or the Antitrust
Division could take such action under the antitrust laws as it deems necessary
or desirable in the public interest, including seeking to enjoin the acquisition
of Shares pursuant to the Offer or seeking the divestiture of Shares purchased
by the Purchaser or the divestiture of substantial assets of Laidlaw, the
Company or any of their respective subsidiaries. Private parties and state
attorneys general may also bring legal action under federal or state antitrust
laws under certain circumstances.
Although the Purchaser believes that the acquisition of Shares pursuant to
the Offer would not violate the antitrust laws, there can be no assurance that a
challenge to the Offer on antitrust grounds will not be made or, if a challenge
is made, what the outcome will be.
SECTION 16. FEES AND EXPENSES. Except as set forth below, neither Laidlaw
nor the Purchaser will pay any fees or commissions to any broker, dealer or
other person in connection with the solicitation of tenders of Shares pursuant
to the Offer.
Merrill Lynch & Co. ("Merrill Lynch") is acting as Dealer Manager in
connection with the Offer and serving as financial advisor to Laidlaw or
Purchaser in connection with the proposed acquisition of the Company. Laidlaw
has agreed to pay Merrill Lynch fees totaling $1,250,000 in connection with
their
29
<PAGE>
engagement, the execution of the Merger Agreement, the public announcement of
the Merger and the commencement of the Offer. In addition, Laidlaw has agreed to
pay Merrill Lynch an additional fee of $2,750,000 upon consummation of the
Offer. Purchaser and Laidlaw have also agreed to reimburse Merrill Lynch for its
reasonable out-of-pocket expenses.
The Purchaser has also retained Morrow & Co., Inc. to act as the Information
Agent and The First National Bank of Boston to act as the Depositary in
connection with the Offer. The Dealer Manager and Information Agent may contact
holders of Shares by mail, telephone, telegraph and personal interview and may
request brokers, dealers and other nominee stockholders to forward the Offer
materials to beneficial owners. The Information Agent and the Depositary will
receive reasonable and customary compensation for their services relating to the
Offer and will be reimbursed for certain out-of-pocket expenses. The Purchaser
and Laidlaw have also agreed to indemnify the Information Agent, the Dealer
Manager and the Depositary against certain liabilities and expenses in
connection with the Offer, including certain liabilities under the federal
securities laws.
Brokers, dealers, commercial banks and trust companies will, upon request,
be reimbursed by the Purchaser for customary mailing and handling expenses
incurred by them in forwarding the Offer materials to their customers.
SECTION 17. MISCELLANEOUS. The Offer is being made solely by this Offer to
Purchase and the related Letter of Transmittal and is being made to all holders
of Shares. The Purchaser is not aware of any state where the making of the Offer
is prohibited by administrative or judicial action pursuant to any valid state
statute. If the Purchaser becomes aware of any valid state statute prohibiting
the making of the Offer or the acceptance of Shares pursuant thereto, the
Purchaser will make a good faith effort to comply with any such state statute or
seek to have such statute declared inapplicable to the Offer. If after such good
faith effort, the Purchaser cannot comply with such state statute, the Offer
will not be made to (nor will tenders be accepted from or on behalf of) the
holders of Shares in such state. In any jurisdiction where the securities, blue
sky or other laws require the Offer to be made by a licensed broker or dealer,
the Offer shall be deemed to be made on behalf of the Purchaser by one or more
registered brokers or dealers that are licensed under the laws of such
jurisdiction.
The Purchaser and Laidlaw have filed with the Commission a Schedule 14D-1
(including exhibits) pursuant to Rule 14d-3 under the Exchange Act, furnishing
certain additional information with respect to the Offer. Such statement and any
amendments thereto, including exhibits, may be inspected and copies may be
obtained from the offices of the Commission (except that they will not be
available at the regional offices of the Commission) in the manner set forth in
Section 7 of this Offer to Purchase.
NO PERSON HAS BEEN AUTHORIZED TO GIVE ANY INFORMATION OR TO MAKE ANY
REPRESENTATION ON BEHALF OF THE PURCHASER OR LAIDLAW NOT CONTAINED IN THIS OFFER
TO PURCHASE OR IN THE LETTER OF TRANSMITTAL AND, IF GIVEN OR MADE, SUCH
INFORMATION OR REPRESENTATION MUST NOT BE RELIED UPON AS HAVING BEEN AUTHORIZED.
MEDTRANS ACQUISITION CO.
January 10, 1997
30
<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 or his
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:
THE FIRST NATIONAL BANK OF BOSTON
<TABLE>
<CAPTION>
BY MAIL: BY FACSIMILE TRANSMISSION: BY HAND:
<S> <C> <C>
Shareholder Services Division (617) 575-2232 BancBoston Trust Company
P.O. Box 1889 (617) 575-2233 of New York
Mail Stop 45-02-53 (For Eligible Institutions Only) 55 Broadway, Third Floor
Boston, Massachusetts 02105 New York, New York
(617) 575-3120
CONFIRM FACSIMILE BY TELEPHONE: BY OVERNIGHT COURIER:
(617) 575-3120 The First National Bank of Boston
(For Confirmation Only) Shareholder Services Division
150 Royall Street
Mail Stop: 45-02-53
Canton, Massachusetts 02021
</TABLE>
31
<PAGE>
SCHEDULE I
INFORMATION REGARDING THE DIRECTORS AND EXECUTIVE OFFICERS OF
LAIDLAW AND THE PURCHASER
1. DIRECTORS AND EXECUTIVE OFFICERS OF LAIDLAW. Set forth in the table
below are the name and the present principal occupations or employment and the
name, principal business and address of any corporation or other organization in
which such occupation or employment is conducted, and the five-year employment
history of each of the directors and executive officers of Laidlaw. Laidlaw
indirectly owns 100% of the equity interest in the Purchaser. Unless otherwise
indicated, each person identified below is employed by Laidlaw. The principal
business address of Laidlaw and, unless otherwise indicated, the business
address of each person identified below is 3221 North Service Road, Burlington,
Ontario L7R 3Y8. Directors are identified by an asterisk. Unless otherwise
indicated, each person identified below is a Canadian citizen.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OR EMPLOYMENT AND
NAME FIVE-YEAR EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
Peter N.T. Widdrington* ................................ Mr. Widdrington, 66, has been Chairman of the Board
248 Pallmall Street since August 1990 and a director of Laidlaw since 1986.
Suite 400 Since June 1996, he has been Chief Executive Officer of
London, Ontario N6A 5P6 Cuddy International Corporation, a poultry producer. He
was Chairman of the Board of The Toronto Blue Jays
Baseball Club, a professional baseball club from
January 1992 until 1995. For more than one year prior
thereto, he was Chairman of the Board of John Labatt
Limited, a food and beverage company. Mr. Widdrington
is also a director of Canadian Imperial Bank of
Commerce, CEC Resources Ltd., Cuddy International
Corporation, Ellis-Don Inc., SNC-Lavalin Group Inc. and
Talisman Energy Inc.
James R. Bullock*....................................... Mr. Bullock, 52, has been a director of Laidlaw since
1991 and President and Chief Executive Officer of the
Company since October 1993. For more than two years
prior thereto, he was President and Chief Executive
Officer of Cadillac Fairview Corporation Limited, a
property development company. Mr. Bullock is also a
director of Dylex Limited and Telemedia Inc.
William P. Cooper* ..................................... Mr. Cooper, 57, has been a director of Laidlaw since
85 The East Mall 1983. For more than five years, he has been President
Toronto, Ontario M8Z 5W4 and Chief Executive Officer of Cooper Construction
Limited, a construction company. Mr. Cooper is also a
director of Baton Broadcasting Inc., Mutual Life of
Canada and Stelco Inc.
</TABLE>
S-1
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OR EMPLOYMENT AND
NAME FIVE-YEAR EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
Jack P. Edwards* ....................................... Mr. Edwards, 51, has been a director of Laidlaw since
3650 - 131st Avenue S.E. January 1996. He has been President and Chief Executive
Suite 700 Officer of Danzas Corporation, a worldwide
Bellevue, Washington 98006 transportation company, since June 1994. Prior thereto,
he was Chief Operating Officer of Circle International
for one and one-half years and President and Chief
Executive Officer of Itel's Transportation Group for
more than five years. Mr. Edwards is a United States
citizen.
William A. Farlinger* .................................. Mr. Farlinger, 67, has been a director of Laidlaw since
700 University Avenue January 1994. He became Chairman of Ontario Hydro, a
19th Floor public utility, in November 1995. Prior thereto, he was
Toronto, Ontario M56 1X6 President and Chief Executive Officer of William A.
Farlinger & Associates, a consulting company, since
October 1993. For more than two years prior thereto, he
was Chairman and Chief Executive Officer of Ernst &
Young, Chartered Accountants, in Canada. Mr. Farlinger
is also a director of Cara Operations, Hongkong Bank of
Canada and Manulife Financial.
Ronald K. Gamey* ....................................... Mr. Gamey, 51, has been a director of Laidlaw since
1800 Bankers Hall East 1988. For more than five years, he has been Executive
855 2nd Street S.W. Vice-President of Canadian Pacific Limited, a
Calgary, Alberta T2P 4Z5 management company.
Donald M. Green* ....................................... Mr. Green, 64, has been a director of Laidlaw since
4145 North Service Road 1980. For more than five years, he has been Chairman of
Suite 200 ACD Tridon Inc., an international automotive parts
Burlington, Ontario L7L 6A3 manufacturing company.
Martha O. Hesse* ....................................... Ms. Hesse, 54, has been a director of Laidlaw since
6524 San Felipe January 1996. She has been President of Hesse Gas
Suite 129 Company, a natural gas marketing company, since 1991.
Houston, Texas 77057 She was Senior Vice-President of First Chicago
Corporation, a major financial institution, during
1990. From 1986 through 1989, she was Chairman of the
United States Federal Energy Regulatory Commission. She
is also a director of Pinnacle West Capital
Corporation, Arizona Public Service and Mutual Trust
Life Insurance Company. Ms. Hesse is a United States
citizen.
</TABLE>
S-2
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OR EMPLOYMENT AND
NAME FIVE-YEAR EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
David P. O'Brien* ...................................... Mr. O'Brien, 55, has been a director of Laidlaw since
1800 Bankers Hall East January 1995. He became Chairman, President and Chief
855 2nd Street S.W. Executive Officer of Canadian Pacific Limited, a
Calgary, Alberta T2P 4Z5 management company, in May 1996 and President and Chief
Operating Officer in February 1995. Prior thereto, he
was Chairman and Chief Executive Officer of PanCanadian
Petroleum Limited, an oil and gas company, from
December 1994, Chairman, President and Chief Executive
Officer from 1992 and President and Chief Executive
Officer from September 1990. Mr. O'Brien is also a
director of Canadian Pacific Limited, Inco Limited,
Fording Coal Limited, PanCanadian Petroleum Limited,
Royal Bank of Canada and Westburne Inc.
Gordon R. Ritchie* ..................................... Mr. Ritchie, 52, has been a director of Laidlaw since
45 O'Connor Street January 1994. He has been Chief Executive Officer of
20th Floor Strategico Inc., a consulting company, since 1988. Mr.
Ottawa, Ontario K1P 1A4 Ritchie is also a director of Telemedia Inc., Maple
Leaf Foods Inc. and Cambior Inc.
William W. Stinson* .................................... Mr. Stinson, 63, has been a director of Laidlaw since
1800 Bankers Hall East 1988. Mr. Stinson retired in May 1996. He was President
855 2nd Street S.W. and Chief Executive Officer of Canadian Pacific
Calgary, Alberta T2P 4Z5 Limited, a management company, from 1985 until 1990
when he became Chairman and Chief Executive Officer.
Mr. Stinson is also a director of Canadian Pacific
Limited, United Dominion Industries Inc., PanCanadian
Petroleum Ltd. and ADT Limited.
Stella M. Thompson* .................................... Mrs. Thompson, 51, has been a director of Laidlaw since
2604 Toronto Crescent N.W. July 1994. She has been President of Stellar Energy
Calgary, Alberta T2N 3W1 Ltd., a consulting company, since 1991. For more than
one year prior thereto, she was a Vice-President of
Petro-Canada Inc. Mrs. Thompson is also a director of
Allstate Insurance Company of Canada, AGRA Industries
Ltd. and Talisman Energy, Inc.
Ivan R. Cairns.......................................... Mr. Cairns, 50, has been Senior Vice-President and
General Counsel of Laidlaw since October 1990 and,
prior thereto, was Vice-President and General Counsel
and Secretary since November 1981.
</TABLE>
S-3
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OR EMPLOYMENT AND
NAME FIVE-YEAR EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
John R. Grainger........................................ Mr. Grainger, 47, has been President of Laidlaw Transit,
Laidlaw's passenger services group, since May 1992.
From February 1990 to that date, he was a Senior
Vice-President of Laidlaw Transit.
Leslie W. Haworth....................................... Mr. Haworth, 53, has been Senior Vice-President and
Chief Financial Officer of Laidlaw since October 1990
and, prior thereto, was Vice-President, Finance and
Chief Financial Officer since March 1978.
Kenneth W. Winger ...................................... Mr. Winger, 58, became President of Laidlaw
220 Outlet Pointe Boulevard Environmental Services, Laidlaw's hazardous waste
Columbia, South Carolina 29221 services group, in July 1995. Prior thereto, he was
Vice-President, Corporate Development of Laidlaw from
December 1994 and Senior Vice-President, Corporate
Development of Laidlaw from May 1991.
</TABLE>
2. DIRECTORS AND EXECUTIVE OFFICERS OF THE PURCHASER. Set forth in the
table below are the name and the present principal occupations or employment and
the name, principal business and address of any corporation or other
organization in which such occupation or employment is conducted, and the
five-year employment history of each of the directors and executive officers of
the Purchaser. Each person identified below is employed by Laidlaw. The
principal business address of the Purchaser is 669 Airport Freeway, Suite 400,
Hurst, Texas 76503, and the principal business address of each person identified
below is 3221 N. Service Road, Burlington, Ontario L7R 3Y8. All persons
identified below are Canadian citizens.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OR EMPLOYMENT AND
NAME FIVE-YEAR EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
James R. Bullock*....................................... Mr. Bullock, 52, has served as President and Director of
Purchaser since its inception in January 1997. He also
has been President and Chief Executive Officer of
Laidlaw since October 1993. For more than two years
prior thereto, he was President and Chief Executive
Officer of Cadillac Fairview Corporation Limited, a
property development company. Mr. Bullock is also a
director of Dylex Limited and Telemedia Inc.
Ivan R. Cairns*......................................... Mr. Cairns, 50, has served as Senior Vice-President,
Secretary and Director of Purchaser since its inception
in January 1997. He also has been Senior Vice-President
and General Counsel of Laidlaw since October 1990 and,
prior thereto, was Vice-President and General Counsel
and Secretary since November 1981.
</TABLE>
S-4
<PAGE>
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION
OR EMPLOYMENT AND
NAME FIVE-YEAR EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
Leslie W. Haworth*...................................... Mr. Haworth, 53, has served as Senior Vice-President and
Director of Purchaser since its inception in January
1997. He also has been Senior Vice-President and Chief
Financial Officer of Laidlaw since October 1990 and,
prior thereto, was Vice-President, Finance and Chief
Financial Officer since March 1978.
</TABLE>
S-5
<PAGE>
Any questions and requests for assistance or additional copies of the Offer
to Purchase, the Letter of Transmittal and related materials may be directed to
the Information Agent or Dealer Manager at their addresses and telephone numbers
set forth below. Stockholders may also contact their broker, dealer, commercial
bank or trust company for assistance concerning the Offer.
THE INFORMATION AGENT FOR THE OFFER IS:
MORROW & CO., INC.
909 Third Avenue
20th Floor
New York, New York 10022
(212) 754-8000
Toll Free (800) 566-9061
Banks and Brokerage Firms please call:
(800) 662-5200
THE DEALER MANAGER FOR THE OFFER IS:
MERRILL LYNCH & CO.
World Financial Center
North Tower
New York, New York 10281
(212) 449-8209 (call collect)
<PAGE>
LETTER OF TRANSMITTAL
TO TENDER SHARES OF COMMON STOCK
OF
AMERICAN MEDICAL RESPONSE, INC.
PURSUANT TO THE OFFER TO PURCHASE
DATED JANUARY 10, 1997
BY
MEDTRANS ACQUISITION CO.
AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF
LAIDLAW INC.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT
12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, FEBRUARY 7, 1997,
UNLESS THE OFFER IS EXTENDED.
THE DEPOSITARY FOR THE OFFER IS:
THE FIRST NATIONAL BANK OF BOSTON
<TABLE>
<S> <C> <C>
BY MAIL: BY FACSIMILE TRANSMISSION: BY HAND:
Shareholder Services Division (617) 575-2232 BancBoston Trust Company
P.O. Box 1889 (617) 575-2233 of New York
Mail Stop 45-02-53 (For Eligible Institutions Only) 55 Broadway, Third Floor
Boston, Massachusetts 02105 CONFIRM FACSIMILE BY TELEPHONE: New York, New York
(617) 575-3120 (617) 575-3120 BY OVERNIGHT COURIER:
(For Confirmation Only) The First National Bank of Boston
Shareholder Services Division
150 Royall Street
Mail Stop: 45-02-53
Canton, Massachusetts 02021
</TABLE>
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET FORTH
ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
This Letter of Transmittal is to be completed by stockholders either if
certificates evidencing Shares (as defined below) are to be forwarded herewith
or, unless an Agent's Message (as defined in Section 2 of the Offer to Purchase)
is utilized, if tenders of Shares are to be made by book-entry transfer into the
account of The First National Bank of Boston, as Depositary (the "Depositary"),
at The Depository Trust Company or the Philadelphia Depository Trust Company
(each, a "Book-Entry Transfer Facility" and, collectively, the "Book-Entry
Transfer Facilities") pursuant to the procedures set forth in Section 3 of the
Offer to Purchase (as defined below). Stockholders who tender Shares by
book-entry transfer are referred to herein as "Book-Entry Stockholders."
Holders of Shares whose certificates evidencing such Shares (the "Share
Certificates") are not immediately available or who cannot deliver their Share
Certificates and all other required documents to the Depositary prior to the
Expiration Date (as defined in Section 1 of the Offer to Purchase), or who
cannot complete the procedure for book-entry transfer on a timely basis, must
tender their Shares according to the guaranteed delivery procedure set forth in
Section 3 of the Offer to Purchase. See Instruction 2. DELIVERY OF DOCUMENTS TO
A BOOK-ENTRY TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
<PAGE>
<TABLE>
<CAPTION>
DESCRIPTION OF SHARES TENDERED
NAME(S) AND ADDRESS(ES) OF SHARE CERTIFICATE(S) AND SHARE(S) TENDERED
REGISTERED HOLDER(S) (ATTACH ADDITIONAL SIGNED LIST IF NECESSARY)
(PLEASE FILL IN, IF BLANK,
EXACTLY AS NAME(S) APPEAR(S) ON
CERTIFICATE(S))
TOTAL NUMBER OF
SHARE SHARES
CERTIFICATE REPRESENTED BY NUMBER OF SHARES
NUMBER(S)* CERTIFICATE(S)* TENDERED**
<S> <C> <C> <C>
TOTAL SHARES ...................
* Need not be completed by Book-Entry Stockholders.
** Unless otherwise indicated, all Shares represented by certificates delivered to the
Depositary will be deemed to have been tendered. See Instruction 4.
</TABLE>
/ / CHECK HERE IF SHARES ARE BEING TENDERED BY BOOK-ENTRY TRANSFER MADE TO AN
ACCOUNT MAINTAINED BY THE DEPOSITARY WITH A BOOK-ENTRY TRANSFER FACILITY AND
COMPLETE THE FOLLOWING (ONLY PARTICIPANTS IN A BOOK-ENTRY TRANSFER FACILITY
MAY DELIVER SHARES BY BOOK-ENTRY TRANSFER):
Name of Tendering Institution_______________________________________________
Check box of Book-Entry Transfer Facility (check one):
/ / The Depository Trust Company / / Philadelphia Depository Trust Company
Account Number _________________ Transaction Code Number ________________
/ / CHECK HERE IF SHARES ARE BEING TENDERED PURSUANT TO A NOTICE OF GUARANTEED
DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING:
Name(s) of Registered Owner(s): ____________________________________________
Window Ticket Number (if any): _____________________________________________
Date of Execution of Notice of Guaranteed Delivery: ________________________
Name of Institution that Guaranteed Delivery: ______________________________
If delivered by Book-Entry Transfer, check box of Book-Entry Transfer
Facility (check one):
/ / The Depository Trust Company / / Philadelphia Depository Trust Company
Account Number _________________ Transaction Code Number ________________
<PAGE>
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY
Ladies and Gentlemen:
The undersigned hereby tenders to MedTrans Acquisition Co. (the
"Purchaser"), a Delaware corporation and an indirect wholly-owned subsidiary of
Laidlaw Inc., a Canadian corporation, ("Laidlaw"), the above-described shares of
common stock, par value $.01 per share (the "Shares"), of American Medical
Response, Inc., a Delaware corporation (the "Company"), at a purchase price of
$40.00 per Share, net to the seller in cash, without interest thereon, upon the
terms and subject to the conditions set forth in the Offer to Purchase dated
January 10, 1997 (the "Offer to Purchase") and in this Letter of Transmittal
(which, together with any supplements and amendments, collectively constitute
the "Offer"), receipt of which is hereby acknowledged. The undersigned
understands that the Purchaser reserves the right to transfer or assign, in
whole or from time to time in part, to one or more of its affiliates, the right
to purchase all or any portion of the Shares tendered pursuant to the Offer.
Upon the terms and conditions of the Offer and subject to, and effective
upon, acceptance for 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 that are being tendered hereby and any and all dividends,
distributions (including additional Shares) or rights declared, paid or issued
with respect to the tendered Shares on or after January 6, 1997 and payable or
distributable to the undersigned on a date prior to the transfer to the name of
the Purchaser or nominee or transferee of the Purchaser on the Company's stock
transfer records of the Shares tendered herewith, and appoints the Depositary
the true and lawful agent and attorney-in-fact of the undersigned with respect
to such Shares with full power of substitution (such power of attorney being
deemed to be an irrevocable power coupled with an interest) to (a) deliver such
Share Certificates (as defined herein) or transfer ownership of such Shares on
the account books maintained by a Book-Entry Transfer Facility, together in
either case with all accompanying evidences of transfer and authenticity, to the
Depositary for the account of the Purchaser upon receipt by the Depositary of
the purchase price, (b) present such Shares for transfer on the books of the
Company and (c) receive all benefits and otherwise exercise all rights of
beneficial ownership of such Shares, all in accordance with the terms and
subject to the conditions of the Offer.
The undersigned irrevocably appoints the Purchaser, its officers and its
designees, and each of them, the attorneys-in-fact and proxies of the
undersigned, with full power of substitution, to the full extent of such
stockholder's rights with respect to the Shares tendered by such stockholder and
accepted for payment by the Purchaser and with respect to any and all other
Shares or other securities issued or issuable in respect of such Shares on or
after January 6, 1997. This proxy and power of attorney is coupled with an
interest in the Shares tendered hereby and is irrevocable and is granted in
consideration of, and is effective upon, the acceptance for payment of such
Shares by the Purchaser in accordance with the terms of the Offer. Upon such
acceptance for payment, all prior proxies given by such stockholder with respect
to such Shares (and such other shares and securities) will be revoked without
further action, and no subsequent proxies may be given nor any subsequent
written consents executed (and, if given or executed, will not be deemed
effective) with respect thereto by the undersigned. The Purchaser, its officers
and its designees will, with respect to the Shares (and such other securities)
tendered, be empowered to exercise all voting and other rights of such
stockholder as they in their sole discretion may deem proper at any annual or
special meeting of the Company's stockholders or any adjournment or postponement
thereof, by written consent in lieu of any such meeting or otherwise. The
Purchaser reserves the right to require that, in order for Shares 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 other securities, including voting at any meeting of stockholders.
The undersigned hereby represents and warrants that (a) the undersigned has
full power and authority to tender, sell, assign and transfer the Shares
tendered hereby and (b) when the Shares are accepted for payment by the
Purchaser, the Purchaser will acquire good, marketable and unencumbered title to
the Shares, free and clear of all liens, restrictions, charges and encumbrances,
and the same will not be subject to any adverse claim. The undersigned, upon
request, will execute and deliver any additional documents deemed by the
Depositary or the Purchaser to be necessary or desirable to complete the sale,
assignment and transfer of the Shares tendered hereby.
All authority herein conferred or agreed to be conferred shall not be
affected by and shall survive the death or incapacity of the undersigned and any
obligation of the undersigned hereunder shall be binding upon the heirs,
personal representatives, successors and assigns of the undersigned.
<PAGE>
Tenders of Shares made pursuant to the Offer are irrevocable, except that
Shares tendered pursuant to the Offer may be withdrawn at any time prior to the
Expiration Date (as defined in the Offer to Purchase) and, unless theretofore
accepted for payment by the Purchaser pursuant to the Offer, may also be
withdrawn at any time after March 10, 1997. See Section 4 of the Offer to
Purchase.
The undersigned understands that tenders of Shares pursuant to any of the
procedures described in Section 3 of the Offer to Purchase and in the
instructions hereto and acceptance for payment of such Shares will constitute a
binding agreement between the undersigned and the Purchaser upon the terms and
subject to the conditions set forth in the Offer, including the undersigned's
representation that the undersigned owns the Shares being tendered.
Unless otherwise indicated herein under "Special Payment Instructions,"
please issue the check for the purchase price and/or issue or return any
certificate(s) for Shares not tendered or not accepted for payment in the
name(s) of the registered holder(s) appearing under "Description of Shares
Tendered." Similarly, unless otherwise indicated herein under "Special Delivery
Instructions," please mail the check for the purchase price and/or any
certificate(s) for Shares not tendered or not accepted for payment (and
accompanying documents, as appropriate) to the address(es) of the registered
holder(s) appearing under "Description of Shares Tendered." In the event that
both the Special Delivery Instructions and the Special Payment Instructions are
completed, please issue the check for the purchase price and/or any
certificate(s) for Shares not tendered or accepted for payment in the name of,
and deliver such check and/or such certificates to, the person or persons so
indicated. The undersigned recognizes that the Purchaser has no obligation,
pursuant to the Special Payment Instructions, to transfer any Shares from the
name(s) of the registered holder(s) thereof if the Purchaser does not accept for
payment any of the Shares so tendered.
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. No signature guarantee is required on this
Letter of Transmittal (a) if this Letter of Transmittal is signed by the
registered holder(s) (which term, for purposes of this document, shall include
any participant in a Book-Entry Transfer Facility whose name appears on a
security position listing as the owner of Shares) of Shares tendered herewith,
unless such holder(s) has completed either the box entitled "Special Payment
Instructions" or the box entitled "Special Delivery Instructions" above, or (b)
if such Shares are tendered for the account of a firm which is a bank, broker,
dealer, credit union, savings association or other entity which is a member in
good standing of a recognized Medallion Signature Guarantee Program (each of the
foregoing being referred to as an "Eligible Institution"). In all other cases,
all signatures on this Letter of Transmittal must be guaranteed by an Eligible
Institution. See Instruction 5 of this Letter of Transmittal.
2. REQUIREMENTS OF TENDER. This Letter of Transmittal is to be completed
by stockholders either if certificates are to be forwarded herewith or, unless
an Agent's Message is utilized, if tenders are to be made pursuant to the
procedure for tender by book-entry transfer set forth in Section 3 of the Offer
to Purchase. Share Certificates, or timely confirmation (a "Book-Entry
Confirmation") of a book-entry transfer of such Shares into the Depositary's
account at a Book-Entry Transfer Facility, as well as this Letter of Transmittal
(or a facsimile hereof), properly completed and duly executed with any required
signature guarantees, or an Agent's Message in connection with a book-entry
transfer, and any other documents required by this Letter of Transmittal, must
be received by the Depositary at one of its addresses set forth on the front
page of this Letter of Transmittal prior to the Expiration Date (as defined in
Section 1 of the Offer to Purchase). Stockholders whose Share Certificates are
not immediately available or who cannot deliver their Share Certificates and all
other required documents to the Depositary prior to the Expiration Date or who
cannot complete the procedure for delivery by book-entry transfer on a timely
basis may tender their Shares by properly completing and duly executing a Notice
of Guaranteed Delivery pursuant to the guaranteed delivery procedure set forth
in Section 3 of the Offer to Purchase. Pursuant to such procedure: (i) such
tender must be made by or through an Eligible Institution; (ii) a properly
completed and duly executed Notice of Guaranteed Delivery, substantially in the
form made available by the Purchaser, must be received by the Depositary prior
to the Expiration Date; and (iii) the Share Certificates (or a Book-Entry
Confirmation) representing all tendered Shares, in proper form for transfer, in
each case together with the Letter of Transmittal (or a facsimile thereof),
properly completed and duly executed with any required signature guarantees (or,
in the case of a book-entry delivery, an Agent's Message) and any other
documents required by this Letter of Transmittal, must be received by the
Depositary within five New York Stock Exchange, Inc. ("NYSE") trading days after
the date of execution of such Notice of Guaranteed Delivery. 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 OPTION AND RISK OF THE TENDERING STOCKHOLDER. DELIVERY WILL BE DEEMED MADE
ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY. IF DELIVERY IS BY MAIL,
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED.
IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted, and no
fractional Shares will be purchased (unless you are tendering all of the Shares
you own). All tendering stockholders, by execution of this Letter of Transmittal
(or a facsimile hereof), waive any right to receive any notice of the acceptance
of their Shares for payment.
3. INADEQUATE SPACE. If the space provided herein is inadequate, the
certificate numbers and/or the number of Shares and any other required
information should be listed on a separate signed schedule attached hereto.
4. PARTIAL TENDERS. (NOT APPLICABLE TO BOOK-ENTRY STOCKHOLDERS) If fewer
than all of the Shares evidenced by any Share Certificate delivered to the
Depositary 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 a case, new
Share Certificates for the Shares that were evidenced by your old Share
Certificates, but were not tendered by you, will be sent to you (unless
otherwise provided in the appropriate box on this Letter of Transmittal) as soon
as practicable after the Expiration Date. All Shares represented by Share
Certificates delivered to the Depositary will be deemed to have been tendered
unless otherwise indicated.
5. SIGNATURES ON LETTER OF TRANSMITTAL, STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the Shares
tendered hereby, the signature(s) must correspond with the name(s) as written on
the face of the certificate(s) without alteration, enlargement or any change
whatsoever.
<PAGE>
If any of the Shares tendered hereby are owned of record by two or more
joint owners, all such owners must sign this Letter of Transmittal.
If any of the tendered Shares are registered in different names on several
certificates, it will be necessary to complete, sign and submit as many separate
Letters of Transmittal as there are different registrations of certificates.
If this Letter of Transmittal or any certificates or stock powers are signed
by trustees, executors, administrators, guardians, attorneys-in-fact, officers
of corporations or others acting in a fiduciary or representative capacity, such
persons should so indicate when signing, and proper evidence satisfactory to the
Purchaser of their authority so to act must be submitted.
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares 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 not purchased are to be issued in the
name of a person other than the registered holder(s). Signatures on such
certificates or stock powers must be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the certificate(s) listed, the certificate(s) must be
endorsed or accompanied by appropriate stock powers, in either case signed
exactly as the name(s) of the registered holder(s) appear on the certificate(s)
for such Shares. Signatures on such certificates or stock powers must be
guaranteed by an Eligible Institution.
6. STOCK TRANSFER TAXES. Except as otherwise provided in this Instruction
6, the Purchaser will pay or cause to be paid 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 if
certificate(s) for Shares not tendered or accepted for payment are to be
registered in the name of, any person other than the registered holder(s), if a
transfer tax is imposed for any reason other than the sale or transfer of Shares
to Purchaser pursuant to the Offer, or if tendered certificate(s) are registered
in the name of any person other than the person(s) signing this Letter of
Transmittal, the amount of any stock transfer taxes (whether imposed on the
registered holder(s) or such person) payable on account of the transfer to such
person will be deducted from the purchase price unless satisfactory evidence of
the payment of such taxes or an exemption therefrom, is submitted.
EXCEPT AS OTHERWISE PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY
FOR TRANSFER TAX STAMPS TO BE AFFIXED TO THE CERTIFICATE(S) LISTED IN THIS
LETTER OF TRANSMITTAL.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If the check for the
purchase price of any Shares purchased is to be issued in the name of, or any
Shares not tendered or not purchased are to be returned to, a person other than
the person(s) signing this Letter of Transmittal or if the check or any
certificates for Shares not tendered or not purchased are to be mailed to
someone other than the person(s) signing this Letter of Transmittal or to the
person(s) signing this Letter of Transmittal at an address other than that shown
above, the appropriate boxes on this Letter of Transmittal should be completed.
Stockholders tendering Shares by book-entry transfer may request that Shares not
purchased be credited to such account at any of the Book-Entry Transfer
Facilities as such stockholder may designate under "Special Payment
Instructions." If no such instructions are given, any such Shares not purchased
will be returned by crediting the account at the Book-Entry Transfer Facilities
designated above.
8. WAIVER OF CONDITIONS. The conditions of the Offer may be waived by the
Purchaser in whole or in part at any time and from time to time in its sole
discretion.
9. 31% BACKUP WITHHOLDING, SUBSTITUTE FORM W-9. 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 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 number or intends to apply for a number in the near
future. If the box in Part 3 is checked and the Depositary is not provided with
a TIN by the time of payment, the Depositary will withhold 31% of all payments
of the purchase price thereafter until a TIN is provided to the Depositary.
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. 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%.
<PAGE>
Certain stockholders (including, among others, all corporations and certain
foreign individuals) are not subject to these backup withholding and reporting
requirements. In order for a foreign individual to qualify as an exempt
recipient, the stockholder must submit a Form W-8, signed under penalties of
perjury, attesting to that individual's exempt status. A Form W-8 can be
obtained from the Depositary. See the enclosed Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9 for additional
instructions.
If backup withholding applies, the Depositary is required to withhold 31% of
any such payments made to the stockholder or other payee. Backup withholding is
not an additional tax. Rather, the tax liability of persons subject to backup
withholding will be reduced by the amount of tax withheld. If withholding
results in an overpayment of taxes, a refund may be obtained from the Internal
Revenue Service.
The box in Part 3 of the Substitute Form W-9 may be checked if the tendering
stockholder has not been issued a TIN and has applied for a TIN or intends to
apply for a TIN in the near future. If the box in Part 3 is checked, the
stockholder or other payee must also complete the Certificate of Awaiting
Taxpayer Identification Number below in order to avoid backup withholding.
Notwithstanding that the box in Part 3 is checked and the Certificate of
Awaiting Taxpayer Identification Number is completed, the Depositary will
withhold 31% of all payments made prior to the time a properly certified TIN is
provided to the Depositary.
The stockholder is required to give the Depositary the 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.
10. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions or requests
for assistance may be directed to the Information Agent at its address and
telephone numbers set forth below. Additional copies of the Offer to Purchase,
this Letter of Transmittal and the Notice of Guaranteed Delivery may also be
obtained from the Information Agent or the Dealer Manager at their respective
addresses and telephone numbers set forth below, or from brokers, dealers,
commercial banks or trust companies.
11. LOST, DESTROYED OR STOLEN CERTIFICATES. If any certificate evidencing
Shares has been lost, destroyed or stolen, the stockholder should promptly
notify the Depositary. The stockholder will then be instructed as to the steps
that must be taken in order to replace the certificate. This Letter of
Transmittal and related documents cannot be processed until the procedures for
replacing lost or destroyed certificates have been followed.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A FACSIMILE HEREOF), TOGETHER WITH
SHARE CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY TRANSFER OR THE NOTICE OF
GUARANTEED DELIVERY, AND ALL OTHER REQUIRED DOCUMENTS, MUST BE RECEIVED BY THE
DEPOSITARY PRIOR TO THE EXPIRATION DATE.
<PAGE>
PAYER'S NAME: THE FIRST NATIONAL BANK OF BOSTON
<TABLE>
<S> <C> <C>
SUBSTITUTE PART 1--PLEASE PROVIDE YOUR TIN IN THE BOX AT THE Social Security Number
RIGHT AND CERTIFY BY SIGNING AND DATING BELOW. or Employer Identification Number
------------------------------------
FORM W-9 PART 2--For Payees exempt from backup withholding, see the enclosed Guidelines for Certification of
Department of the Treasury, Taxpayer Identification Number on Substitute Form W-9 and complete as instructed therein.
Internal Revenue Service Certification--Under penalties of perjury, I certify that:
PAYER'S REQUEST FOR (1) The number shown on this form is my correct Taxpayer Identification Number (or I am waiting for
TAXPAYER IDENTIFICATION a number to be issued to me) and
NUMBER ("TIN") (2) I am not subject to backup withholding because: (a) I am exempt from backup withholding, or (b)
I have not been notified by the Internal Revenue Service (the "IRS") that I am subject to backup
withholding as a result of a failure to report all interest or dividends, or (c) the IRS has
notified me that I am no longer subject to backup withholding.
CERTIFICATION INSTRUCTIONS--You must cross out item (2) above if you have been notified by the IRS
that you are currently subject to backup withholding because of under-reporting interest or
dividends on your tax return.However, if after being notified by the IRS that you were subject to
backup withholding you received another notification from the IRS that you are no longer subject to
backup withholding, do not cross out such Item (2). (Also see instructions in the enclosed
Guidelines)
SIGN HERE --> Signature --------------------------- PART 3
Date: ------------------------, 1997 Awaiting TIN / /
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACK-UP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW
THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION ON
SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU ARE AWAITING YOUR TIN.
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a Taxpayer Identification Number has
not been issued to me, and either (1) I have mailed or delivered an application
to receive a Taxpayer Identification Number to the appropriate Internal Revenue
Service Center or Social Security Administration Office, or (2) I intend to mail
or deliver an application in the near future. I understand that if I do not
provide a Taxpayer Identification Number by the time of payment, 31% of all
reportable payments made to me will be withheld.
Signature Date , 1997
<PAGE>
<TABLE>
<S> <C>
SPECIAL PAYMENT INSTRUCTIONS SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7) (SEE INSTRUCTIONS 1 AND 7)
To be completed ONLY if certificate(s) for Shares not To be completed ONLY if certificate(s) for Shares not
tendered or not accepted for payment and/or the check for tendered or not accepted for payment and/or the check for
the purchase price of Shares accepted for payment are to be the purchase price of Shares accepted for payment are to be
issued in the name of someone other than the undersigned. sent to someone other than the undersigned or to the
Issue: / / check and/or / / certificates to: undersigned at an address other than that appearing under
Name: ...................................................... "DESCRIPTION OF SHARES TENDERED."
(Please Print) Mail: / / check and/or / / certificates to:
Address: ................................................... Name: ......................................................
........................................................... (Please Print)
(Include Zip Code) Address: ...................................................
........................................................... ............................................................
(Tax Identification or Social Security No.) (Include Zip Code)
(See Substitute Form W-9) ............................. .............................
/ / Credit unpurchased Shares tendered by book-entry (Tax Identification or Social Security No.)
transfer to the account set forth below: (See Substitute Form W-9)
Name of Account Party ......................................
Account No. ............................................. at
/ / The Depository Trust Company
/ / Philadelphia Depository Trust Company
</TABLE>
<PAGE>
<TABLE>
<C> <S> <C>
SIGN SIGN HERE SIGN
HERE AND COMPLETE SUBSTITUTE FORM W-9 HERE
ARROW ................................................................................................ ARROW
................................................................................................
(Signature of Holder(s))
Dated: ................................................................................ , 1997
(Must be signed by the registered holder(s) exactly as name(s) appear(s) on Share Certificate(s)
or on a security position listing or by person(s) authorized to become registered holder(s) by
certificates and documents transmitted herewith. If signature is by trustees, executors,
administrators, guardians, attorneys-in-fact, officers of corporations or others acting in a
fiduciary or representative capacity, please provide the following information and See
Instruction 5.)
Name(s) .......................................................................................
................................................................................................
(Please Print)
Capacity (Full Title) .........................................................................
Address ........................................................................................
................................................................................................
(Include Zip Code)
Area Code and Telephone Number .................................................................
Tax Identification or
Social Security No. ...........................................................................
(See Substitute Form W-9)
GUARANTEE OF SIGNATURE(S)
(If Required -- See Instructions 1 and 5)
Authorized Signature ...........................................................................
Name ...........................................................................................
Name of Firm ...................................................................................
(Please Print)
Address ........................................................................................
(Include Zip Code)
Area Code and Telephone Number .................................................................
Dated: ................................................................................ , 1997
</TABLE>
<PAGE>
THE DEALER MANAGER FOR THE OFFER IS:
MERRILL LYNCH & CO.
World Financial Center
North Tower
New York, New York 10281
(212) 449-8209 (call collect)
THE INFORMATION AGENT FOR THE OFFER IS:
MORROW & CO., INC.
909 Third Avenue
20th Floor
New York, New York 10022
(212) 754-8000
Toll Free (800) 566-9061
Banks and Brokerage Firms please call:
(800) 662-5200
January 10, 1997
<PAGE>
NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF SHARES OF COMMON STOCK
OF
AMERICAN MEDICAL RESPONSE, INC.
As set forth in Section 3 of the Offer to Purchase described below, this
instrument or one substantially equivalent hereto must be used to accept the
Offer (as defined below) if (i) certificates evidencing Shares of common stock,
par value $.01 per share, (the "Shares") are not immediately available, (ii) the
certificates evidencing Shares and all other required documents cannot be
delivered to the Depositary prior to the Expiration Date (as defined in Section
1 of the Offer to Purchase), or (iii) the procedure for delivery by book-entry
transfer cannot be completed on a timely basis. This instrument may be
transmitted by facsimile transmission or delivered by hand or mail to the
Depositary.
THE DEPOSITARY FOR THE OFFER IS:
THE FIRST NATIONAL BANK OF BOSTON
<TABLE>
<S> <C> <C>
BY MAIL: BY FACSIMILE TRANSMISSION: BY HAND:
(for Eligible Institutions)
Shareholder Services Division (617) 575-2232 BancBoston Trust Company
P.O. Box 1889 (617) 575-2233 of New York
Mail Stop 45-02-53 55 Broadway, Third Floor
Boston, Massachusetts 02105 New York, New York
(617) 575-3120
CONFIRM FACSIMILE BY TELEPHONE: BY OVERNIGHT COURIER:
(617) 575-3120 The First National Bank of Boston
(For Confirmation Only) Shareholder Services Division
150 Royall Street
Mail Stop: 45-02-53
Canton, Massachusetts 02021
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION OTHER THAN AS SET FORTH
ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
This form is not to be used to guarantee signatures. If a signature on a
Letter of Transmittal is required to be guaranteed by an Eligible Institution
under the instructions thereto, the signature guarantee must appear on the
applicable space provided in the signature box in the Letter of Transmittal.
THE GUARANTEE ON THE REVERSE SIDE MUST BE COMPLETED.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tender(s) to MedTrans Acquisition Co., a Delaware
corporation and an indirect wholly-owned subsidiary of Laidlaw Inc., a Canadian
corporation, upon the terms and subject to the conditions set forth in the Offer
to Purchase dated January 10, 1997 (the "Offer to Purchase") and in the related
Letter of Transmittal (which, together with any supplements and amendments,
collectively constitute the "Offer"), receipt of which is hereby acknowledged,
the number of Shares indicated below of American Medical Response, Inc., a
Delaware corporation, pursuant to the guaranteed delivery procedures set forth
in Section 3 of the Offer to Purchase.
<TABLE>
<S> <C>
Signature(s) ..................................... Address(es) ......................................
................................................. ..................................................
ZIP CODE
Name(s) of Record Holders ........................ Area Code and Tel. No.(s) ........................
.................................................
Please Type or Print
................................................. Check one box if Shares will be
tendered by book-entry transfer
................................................. / / The Depository Trust Company
Number of Shares .................................
Certificate No.(s) (If Available)
................................................. / / Philadelphia Depository Trust Company
.................................................
Dated ................................... , 1997 Account Number ...................................
</TABLE>
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm that is a bank, broker, dealer, credit union,
savings association or other entity which is a member in good standing of the
Securities Transfer Agents Medallion Program, (a) represents that the above
named person(s) "own(s)" the Shares tendered hereby within the meaning of Rule
14e-4 under the Securities Exchange Act of 1934, as amended ("Rule 14e-4"), (b)
represents that the tender of those Shares complies with Rule 14e-4, (c)
guarantees to deliver to the Depositary either the certificates evidencing all
tendered Shares, in proper form for transfer, or to deliver Shares pursuant to
the procedure for book-entry transfer into the Depositary's account at the book
entry facility identified above (each a "Book-Entry Transfer Facility"), in
either case together with the Letter of Transmittal (or a facsimile thereof),
properly completed and duly executed with any required signature guarantees, or
an Agent's Message (as defined in the Offer to Purchase) in the case of a book-
entry delivery, and any other required documents, all within five New York Stock
Exchange, Inc. ("NYSE") trading days after the date hereof.
<TABLE>
<S> <C>
................................................. ..................................................
NAME OF FIRM AUTHORIZED SIGNATURE
................................................. Name .............................................
ADDRESS PLEASE TYPE OR PRINT
................................................. Title ............................................
ZIP CODE
Area Code and Tel. No. ........................... Date .................................... , 1997
</TABLE>
NOTE: DO NOT SEND CERTIFICATES EVIDENCING SHARES WITH THIS NOTICE.
CERTIFICATES SHOULD BE SENT WITH YOUR LETTER OF TRANSMITTAL.
<PAGE>
MERRILL LYNCH, PIERCE, FENNER & SMITH INCORPORATED
WORLD FINANCIAL CENTER
NORTH TOWER
NEW YORK, NEW YORK 10281
TEL: (212) 449-8209 (CALL COLLECT)
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
AMERICAN MEDICAL RESPONSE, INC.
AT
$40.00 NET PER SHARE
BY
MEDTRANS ACQUISITION CO.
AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF
LAIDLAW INC.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT
12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, FEBRUARY 7, 1997,
UNLESS THE OFFER IS EXTENDED
January 10, 1997
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
We have been engaged by MedTrans Acquisition Co. (the "Purchaser"), a
Delaware corporation and an indirect wholly-owned subsidiary of Laidlaw Inc., a
Canadian corporation, ("Laidlaw"), to act as Dealer Manager in connection with
the Purchaser's offer to purchase for cash all of the outstanding shares of
common stock, par value $.01 per share, of American Medical Response, Inc., a
Delaware corporation (the "Company"), (the "Shares") at a purchase price of
$40.00 per Share, net to the seller in cash, without interest thereon, upon the
terms and subject to the conditions set forth in the Offer to Purchase and in
the related Letter of Transmittal (which, together with any supplements or
amendments, collectively constitute the "Offer") enclosed herewith. Holders of
Shares whose certificates evidencing such Shares (the "Shares Certificates") are
not immediately available or who cannot deliver their Share Certificates and all
other required documents to the Depositary (as defined below) prior to the
Expiration Date (as defined in the Offer to Purchase), or who cannot complete
the procedures for book-entry transfer on a timely basis, must tender their
Shares according to the guaranteed delivery procedures set forth in Section 3 of
the Offer to Purchase.
Please furnish copies of the enclosed materials to those of your clients for
whose accounts you hold Shares registered in your name or in the name of your
nominee.
The Offer is subject to there being validly tendered and not properly
withdrawn prior to the expiration of the Offer a number of Shares which
constitutes at least two-thirds of the outstanding Shares of the Company,
assuming certain exercises and conversions. The Offer is also subject to other
terms and conditions. See the Introduction and Section 14 of the Offer to
Purchase.
<PAGE>
Enclosed herewith for your information and forwarding to your clients are
copies of the following documents:
1. The Offer to Purchase, dated January 10, 1997.
2. The BLUE Letter of Transmittal to tender Shares for your use and for
the information of your clients. Facsimile copies of the Letter of
Transmittal may be used to tender Shares.
3. The PINK Notice of Guaranteed Delivery for Shares to be used to
accept the Offer if Share Certificates are not immediately available, if
such certificates and all other required documents cannot be delivered to
The First National Bank of Boston (the "Depositary") by the Expiration Date,
or if the procedure for book-entry transfer cannot be completed by the
Expiration Date.
4. A YELLOW printed form of letter which may be sent to your clients
for whose accounts you hold Shares registered in your name or in the name of
your nominee, with space provided for obtaining your clients' instructions
with regard to the Offer.
5. Guidelines of the Internal Revenue Service for Certification of
Taxpayer Identification Number on Substitute Form W-9 providing information
relating to backup federal income tax withholding.
6. A return envelope addressed to The First National Bank of Boston,
the Depositary.
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS
PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER AND WITHDRAWAL RIGHTS EXPIRE AT
12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, FEBRUARY 7, 1997, UNLESS THE
OFFER IS EXTENDED.
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of any such extension or
amendment), the Purchaser will be deemed to have accepted for payment, and will
pay for, all Shares validly tendered and not properly withdrawn prior to the
Expiration Date when, as and if the Purchaser gives oral or written notice to
the Depositary of the Purchaser's acceptance of such Shares for payment pursuant
to the Offer. Payment for Shares purchased pursuant to the Offer will be made
only after timely receipt by the Depositary of certificates for such Shares (or
confirmation of a book-entry transfer of such Shares into the Depositary's
account at one of the Book-Entry Transfer Facilities (as described in the Offer
to Purchase)), a properly completed and duly executed Letter of Transmittal (or
facsimile thereof) (unless, in the case of a book-entry transfer, an Agent's
Message (as defined in the Offer to Purchase) is utilized) and any other
documents required by the Letter of Transmittal.
In order to take advantage of the Offer, (i) a duly executed and properly
completed Letter of Transmittal with any required signature guarantees, or an
Agent's Message (as defined in the Offer to Purchase) in connection with a
book-entry delivery of Shares, and any other required documents should be sent
to the Depositary, and (ii) Share Certificates representing the tendered Shares
should be delivered to the Depositary, or such Shares should be tendered by
book-entry transfer into the Depositary's account maintained at one of the
Book-Entry Transfer Facilities (as described in the Offer to Purchase), all in
accordance with the instructions set forth in the Letter of Transmittal and the
Offer to Purchase.
If holders of Shares wish to tender, but it is impracticable for them to
forward their Share Certificates or other required documents on or prior to the
Expiration Date or to comply with the book-entry transfer procedures on a timely
basis, a tender may be effected by following the guaranteed delivery procedures
specified in Section 3 of the Offer to Purchase.
The Purchaser will not pay any commissions or fees to any broker, dealer or
other person (other than the Depositary, the Dealer Manager and the Information
Agent) in connection with the solicitation of tenders of Shares pursuant to the
Offer. The Purchaser will, however, upon request, reimburse brokers, dealers,
commercial banks and trust companies for reasonable and necessary clerical and
mailing expenses incurred by you in forwarding any of the enclosed materials to
your clients. The Purchaser will pay or cause
<PAGE>
to be paid any stock transfer taxes payable on the transfer of Shares to it,
except as otherwise provided in Instruction 6 of the Letter of Transmittal.
Any inquiries you may have with respect to the Offer should be addressed to
us or Morrow & Co. the Information Agent, at its address and telephone numbers
set forth on the back cover of the Offer to Purchase.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED, AS DEALER MANAGER
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY OTHER PERSON THE AGENT OF THE PURCHASER, LAIDLAW, THE COMPANY, THE
DEPOSITARY OR THE INFORMATION AGENT, OR ANY AFFILIATE OF ANY OF THEM, OR
AUTHORIZE YOU OR ANY OTHER PERSON TO MAKE ANY STATEMENT OR USE ANY DOCUMENT ON
BEHALF OF ANY OF THEM IN CONNECTION WITH THE OFFER OTHER THAN THE ENCLOSED
DOCUMENTS AND THE STATEMENTS CONTAINED THEREIN.
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
AMERICAN MEDICAL RESPONSE, INC.
AT
$40.00 NET PER SHARE
BY
MEDTRANS ACQUISITION CO.
AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF
LAIDLAW INC.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT
12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, FEBRUARY 7, 1997,
UNLESS THE OFFER IS EXTENDED.
JANUARY 10, 1997
TO OUR CLIENTS:
Enclosed for your consideration is an Offer to Purchase dated January 10,
1997 (the "Offer to Purchase") and the related Letter of Transmittal relating to
an offer by MedTrans Acquisition Co. (the "Purchaser"), a Delaware corporation
and an indirect wholly-owned subsidiary of Laidlaw Inc., a Canadian corporation
("Laidlaw"), to purchase all of the outstanding shares of common stock, par
value $.01 per share, of American Medical Response, Inc., a Delaware corporation
(the "Company"), (the "Shares") at a purchase price of $40.00 per Share, net to
the seller in cash, without interest thereon, upon the terms and subject to the
conditions set forth in the Offer to Purchase and in the related Letter of
Transmittal (which, together with any supplements or amendments, collectively
constitute the "Offer"). We are the holder of record of Shares held by us for
your account. A TENDER OF SUCH SHARES CAN BE MADE ONLY BY US AS THE HOLDER OF
RECORD AND PURSUANT TO YOUR INSTRUCTIONS. THE LETTER OF TRANSMITTAL IS FURNISHED
TO YOU FOR YOUR INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER SHARES HELD
BY US FOR YOUR ACCOUNT.
We request instructions as to whether you wish to have us tender on your
behalf any or all of such Shares held by us for your account, pursuant to the
terms and subject to the conditions set forth in the Offer.
Your attention is directed to the following:
1. The offer price is $40.00 per Share, net to the seller in cash,
without interest thereon.
2. The Offer is being made for all outstanding Shares.
3. The Offer and withdrawal rights will expire at 12:00 midnight, New
York City time, on Friday, February 7, 1997, unless the Offer is extended.
4. The Offer is conditioned upon, among other things, there being
validly tendered and not properly withdrawn prior to the Expiration Date (as
defined in the Offer to Purchase) a number of Shares which constitutes at
least two-thirds of the outstanding Shares of the Company assuming certain
exercises and conversions. The Offer is also subject to other terms and
conditions. See the Introduction and Section 14 of the Offer to Purchase.
5. The Board of Directors of the Company has unanimously approved the
Offer.
<PAGE>
6. Tendering shareholders will not be obligated to pay brokerage fees
or commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, stock transfer taxes on the purchase of Shares pursuant to the
Offer. However, federal income tax backup withholding at a rate of 31% may
be required, unless a exemption is provided or unless the required taxpayer
identification information is provided. See Instruction 9 of the Letter of
Transmittal.
The Offer is being made solely by the Offer to Purchase and the related
Letter of Transmittal and is being made to all holders of Shares. The Purchaser
is not aware of any state where the making of the Offer is prohibited by
administrative or judicial action pursuant to any valid state statute. If the
Purchaser becomes aware of any valid state statute prohibiting the making of the
Offer or the acceptance of Shares pursuant thereto, the Purchaser will make a
good faith effort to comply with any such state statute or seek to have such
statute declared inapplicable to the Offer. If after such good faith effort, the
Purchaser cannot comply with such state statute, the Offer will not be made to
(nor will tenders be accepted from or on behalf of) the holders of Shares in
such state. In any jurisdiction where the securities, blue sky or other laws
require the Offer to be made by a licensed broker or dealer, the Offer shall be
deemed to be made on behalf of the Purchaser by one or more registered brokers
or dealers that are licensed under the laws of such jurisdiction.
If you wish to have us tender any or all of the Shares held by us for your
account, please instruct us by completing, executing and returning to us the
instruction form contained in this letter. An envelope to return your
instructions to us is enclosed. If you authorize a tender of your Shares, all
such Shares will be tendered unless otherwise specified in such instruction
form. Your instructions should be forwarded to us in ample time to permit us to
submit a tender on your behalf prior to the expiration of the Offer. Holders of
Shares whose Share Certificates (as defined in the Offer to Purchase) are not
immediately available or who cannot deliver their Certificates and all other
required documents to The First National Bank of Boston, as depositary (the
"Depositary"), or complete the procedures for book-entry transfer prior to the
Expiration Date must tender their Shares according to the guaranteed delivery
procedures set forth in Section 3 of the Offer to Purchase.
Payment for Shares purchased pursuant to the Offer will in all cases be made
only after timely receipt by the Depositary of (a) Share Certificates or timely
confirmation of the book-entry transfer of such Shares into the account
maintained by the Depositary at The Depository Trust Company or Philadelphia
Depository Trust Company (collectively, the "Book-Entry Transfer Facilities"),
pursuant to the procedure set forth in Section 3 of the Offer to Purchase, (b)
the Letter of Transmittal (or a facsimile thereof), properly completed and duly
executed with any required signature guarantees, or an Agent's Message (as
defined in the Offer to Purchase) in connection with a book-entry delivery, and
(c) any other documents required by the Letter of Transmittal. Accordingly,
payment may not be made to all tendering shareholders at the same time depending
upon when Share Certificates for or confirmation of book-entry transfer of such
Shares into the Depositary's account at a Book-Entry Transfer Facility are
actually received by the Depositary.
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
AMERICAN MEDICAL RESPONSE, INC.
The undersigned acknowledge(s) receipt of your letter enclosing the Offer to
Purchase dated January 10, 1997 (the "Offer to Purchase") and the related Letter
of Transmittal pursuant to an offer by MedTrans Acquisition Co., a Delaware
corporation and an indirect wholly-owned subsidiary of Laidlaw Inc., a Canadian
corporation, to purchase all outstanding shares of common stock, par value $0.01
per share, of American Medical Response, Inc., a Delaware corporation (the
"Shares").
This will instruct you to tender the number of Shares indicated below (or,
if no number is indicated below, all Shares) which are held by you for the
account of the undersigned, upon the terms and subject to the conditions set
forth in the Offer to Purchase and in the related Letter of Transmittal
furnished to the undersigned.
<TABLE>
<S> <C>
Number of Shares to be Tendered*: SIGN HERE
___________________________ Shares ----------------------------------------
Account
Number _______________________________ ----------------------------------------
Dated , 1997 Signature(s)
----------------------------------------
----------------------------------------
Please type or print name(s)
----------------------------------------
----------------------------------------
Address
----------------------------------------
----------------------------------------
Area Code and Telephone Number
----------------------------------------
Tax Identification or Social Security
Number
----------------------------------------
</TABLE>
- ------------------------
*Unless otherwise indicated, it will be assumed that all of your Shares held by
us for your account are to be tendered.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE
PAYOR--Social Security numbers have nine digits separated by two hyphens: i.e.,
000-00-0000. Employer identification numbers have nine digits separated by only
one hyphen: i.e., 000-000000. The table below will help determine the number to
give the Payor.
<TABLE>
<CAPTION>
GIVE THE GIVE THE EMPLOYER
SOCIAL SECURITY IDENTIFICATION NUMBER
FOR THIS TYPE OF ACCOUNT: NUMBER OF-- FOR THIS TYPE OF ACCOUNT: OF--
- ----------------------------- ------------------------ ----------------------------- ------------------------
<S> <C> <C> <C>
1. An individual's account The individual 8. Sole proprietorship The owner(4)
account
2. Two or more individuals The actual owner of the 9. A valid trust, estate, or Legal entity (Do not
(joint account) account or, if combined pension trust furnish the identifying
funds, any one of the number of the personal
individual's(1) representative or
trustee unless the legal
entity itself is not
designated in the
account title.)(5)
3. Husband and wife (joint The actual owner of the 10. Corporate account The Corporation
account) account or, if joint
funds, either person(1)
4. Custodian account of a The minor(2) 11. Religious, charitable, or The organization
minor (Uniform Gift to educational organization
Minors Act) account
5. Adult and minor (joint The adult or, if the 12. Partnership account held The partnership
account) minor is the only in the name of the business
contributor, the
minor(1)
6. Account in the name of The ward, minor, or 13. Association, club or The organization
guardian or committee for incompetent person(3) other tax-exempt organization
a designated ward, minor,
or incompetent person
7. a. The usual revocable The grantor-trustee(1) 14. A broker or registered The broker or nominee
savings trust account nominee
(grantor is also trustee)
b. So-called trust account The actual owner(1) 15. Account with the The public entity
that is not a legal or Department of Agriculture
valid trust under State in the name of a public
law entity (such as a State
of local governmental
school district or
prison) that receives
agricultural program
payments.
</TABLE>
- ------------------------------
(1) List first and circle the name of the person whose number you furnish.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Circle the ward's, minor's or incompetent person's name and furnish such
person's social security number.
(4) Show the name of the owner.
(5) List first and circle the name of the legal trust, estate or pension trust.
NOTE: If no name is circled when there is more than one name, the number will be
considered to be that of the first name listed.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
PAGE 2
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you don't know your
number, obtain Form SS-5, Application for a Social Security Number Card, or Form
SS-4, Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for a
number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on ALL payments include
the following:
- A corporation.
- A financial institution
- An organization exempt from tax under section 501(a), or an individual
retirement plan.
- The United States or any agency or instrumentality thereof.
- A State, the District of Columbia, a possession of the United States, or
any subdivision or instrumentality thereof.
- A foreign government, a political subdivision of a foreign government, or
any agency or instrumentality thereof.
- An international organization or any agency, or instrumentality thereof.
- A registered dealer in securities or commodities registered in the U.S. or
a possession of the U.S.
- A real estate investment trust.
- A common trust fund operated by a bank under section 584(a).
- An exempt charitable remainder trust,
or a non-exempt trust described in section 4947(a)(1).
- An entity registered at all times under the Investment Company Act of 1940
- A foreign central bank of issue.
Payments of dividends and patronage dividends not generally subject to
backup withholding include the following:
- Payments to nonresident aliens subject to withholding under section 1441.
- Payments to partnerships not engaged in a trade or business in the U.S.
and which have at least one nonresident partner.
- Payments of patronage dividends where the amount received is not paid in
money.
- Payments made by certain foreign organizations.
- Payments made to a nominee.
Payments to interest not generally subject to backup withholding include the
following:
- Payments of interest on obligations issued by individuals
NOTE: You may be subject to backup withholding if this interest is $600 or
more and is paid in the course of the payer's trade or business and you have not
provided your correct taxpayer identification number to the payer.
- Payments of tax-exempt interest (including exempt-interest dividends under
section 852).
- Payments described in section 6049(b)(5) to nonresident aliens.
- Payments on tax-free covenants bonds under section 1451.
- Payments made by certain foreign organizations.
- Payments made to a nominee.
Exempt payees described above should file Form W-9 to avoid possible
erroneous backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR
TAXPAYER IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, AND
RETURN IT TO THE PAYER, IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE
DIVIDENDS, ALSO SIGN AND DATE THE FORM.
Certain payments other than interest, dividends, and patronage dividends
that are not subject to information reporting are also not subject to backup
withholding. For details, see the regulations under sections 6041, 6041A(a),
6045, and 6050A.
PRIVACY ACT NOTICE.--Section 6109 requires most recipients of dividend
interest, or other payments to give taxpayer identification numbers to payers
who must report the payments to IRS. IRS uses the numbers for identification
purposes. Payers must be given the numbers whether or not recipients are
required to file tax returns. Beginning January 1, 1993, payers must generally
withhold 31% of taxable interest, dividend, and certain other payments to a
payee who does not furnish a taxpayer identification number to a payer. Certain
penalties may also apply.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBERS.--If you
fail to furnish your taxpayer identification number to a payer, you are subject
to a penalty of $50 for each such failure unless your failure is due to
reasonable cause and not to willful neglect.
(2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING.--If you
make a false statement with no reasonable basis which results in no imposition
of backup withholding, you are subject to a penalty of $500.
(3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION.--Falsifying certifications
or affirmations may subject you to criminal penalties including fines and/or
imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL
REVENUE SERVICE.
2
<PAGE>
[Form of Advertisement]
This announcement is neither an offer to purchase nor a solicitation of an
offer to sell Shares. The Offer is being made solely by the Offer to Purchase
dated January 10, 1997 and the related Letter of Transmittal and is being made
to all holders of Shares. The Purchaser is not aware of any state where the
making of the Offer is prohibited by administrative or judicial action pursuant
to any valid state statute. If the Purchaser becomes aware of any valid state
statute prohibiting the making of the Offer or the acceptance of Shares pursuant
thereto, the Purchaser will make a good faith effort to comply with such state
statute or seek to have such statute declared inapplicable to the Offer. If,
after such good faith effort, the Purchaser cannot comply with such state
statute, the Offer will not be made to (nor will tenders be accepted from or on
behalf of) the holder of Shares in such state. In any jurisdiction where
securities, blue sky or other laws requires the Offer to be made by a licensed
broker or dealer, the Offer shall be deemed to be made on behalf of the
Purchaser by Merrill Lynch & Co. or one or more registered brokers or dealers
licensed under the laws of such jurisdiction.
NOTICE OF OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
AMERICAN MEDICAL RESPONSE, INC.
AT
$40.00 NET PER SHARE
BY
MEDTRANS ACQUISITION CO.
AN INDIRECT WHOLLY-OWNED SUBSIDIARY OF
LAIDLAW INC.
MedTrans Acquisition Co. (the "Purchaser"), a Delaware corporation and an
indirect wholly-owned subsidiary of Laidlaw Inc., a Canadian corporation
("Laidlaw"), hereby offers to purchase all of the outstanding shares of common
stock, par value $.01 per share, of American Medical Response, Inc., a Delaware
corporation (the "Company"), ("Shares") at a purchase price of $40.00 per Share,
net to the seller in cash, without interest thereon, upon the terms and subject
to the conditions set forth in the Offer to Purchase and in the related Letter
of Transmittal (which, together with any supplements or amendments, collectively
constitute the "Offer").
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT
12:00 MIDNIGHT, NEW YORK CITY TIME, ON FRIDAY, FEBRUARY 7, 1997,
UNLESS THE OFFER IS EXTENDED.
The Offer is conditioned upon, among other things, there being validly
tendered and not properly withdrawn prior to expiration of the Offer a number of
Shares representing at least two-thirds of the Shares outstanding, assuming
certain exercises and conversions.
The Offer is being made pursuant to an Agreement and Plan of Merger, dated
as of January 6, 1997 (the "Merger Agreement"), by and among the Company,
Laidlaw and the Purchaser. The Merger Agreement provides, among other things,
that as soon as practicable after the consummation of the Offer and satisfaction
or, to the extent permitted under the Merger Agreement, waiver of all conditions
to the Merger, the Purchaser will be merged with and into the Company (the
"Merger"). Following consummation of the Merger, the Company will continue as
the surviving corporation of the Merger and as an indirect wholly-owned
subsidiary of Laidlaw. At the effective time of the Merger, each outstanding
Share
<PAGE>
(other than treasury Shares, Shares held by Laidlaw, the Purchaser or any other
subsidiary of Laidlaw, and Shares held by stockholders, if any, who properly
exercise appraisal rights under Delaware law) will be converted into and
represent the right to receive $40.00 in cash, without interest.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE OFFER,
THE MERGER AND THE MERGER AGREEMENT, HAS DETERMINED THAT EACH OF THE OFFER AND
THE MERGER IS FAIR TO, AND IN THE BEST INTEREST OF, THE COMPANY'S STOCKHOLDERS
AND RECOMMENDS THAT ALL STOCKHOLDERS ACCEPT THE OFFER AND TENDER ALL OF THEIR
SHARES PURSUANT TO THE OFFER.
For purposes of the Offer, the Purchaser will be deemed to have accepted for
payment (and thereby purchased) Shares validly tendered and not properly
withdrawn as, if and when the Purchaser gives oral or written notice to the
Depositary (as defined in the Offer to Purchase) of the Purchaser's acceptance
of such Shares for payment pursuant to the Offer. Upon the terms and subject to
the conditions of the Offer, payment for Shares accepted for payment pursuant to
the Offer will be made by deposit of the purchase price therefor with the
Depositary, which will act as agent for tendering stockholders for the purpose
of receiving payments from the Purchaser and transmitting such payments to
stockholders whose Shares have been accepted for payment. In all cases, payment
for Shares tendered and accepted for payment pursuant to the Offer will be made
only after timely receipt by the Depositary of (i) certificates evidencing such
Shares (or timely Book-Entry Confirmation (as defined in Section 2 of the Offer
to Purchase) with respect to such Shares), (ii) the Letter of Transmittal (or a
manually signed facsimile thereof), properly completed and duly executed with
any required signature guarantees (or an Agent's Message (as defined in Section
2 of the Offer to Purchase) in connection with a book-entry transfer), and (iii)
all other documents required by the Letter of Transmittal. Under no
circumstances will interest on the purchase price for Shares be paid, regardless
of any delay in making such payment.
The term "Expiration Date" means 12:00 Midnight, New York City time, on
Friday, February 7, 1997, unless and until the Purchaser, in accordance with the
terms of the Offer and the Merger Agreement, shall have extended the period of
time during which the Offer is open, in which event the term "Expiration Date"
shall mean the latest time and date at which the Offer, as so extended by the
Purchaser, shall expire. Subject to the terms of the Merger Agreement, the
Purchaser expressly reserves the right, at any time and from time to time, to
extend the period of time during which the Offer is open for any reason,
including the occurrence of any of the events specified in Section 14 of the
Offer to Purchase, by giving written notice of such extension to the Depositary.
Any such extension will be followed as promptly as practicable by public
announcement to be made not later than 9:00 a.m., New York City time, on the
next business day after the previously scheduled Expiration Date.
Tenders of Shares made pursuant to the Offer are irrevocable, except that
Shares tendered pursuant to the Offer may be withdrawn at any time on or prior
to the Expiration Date and, unless theretofore accepted for payment by the
Purchaser pursuant to the Offer, may also be withdrawn at any time after March
10, 1997. For a withdrawal to be effective, a written, telegraphic, telex or
facsimile transmission notice of withdrawal must be timely received by the
Depositary at one of the addresses set forth in the Offer to Purchase. Any such
notice of withdrawal must specify the name of the person who tendered the Shares
to be withdrawn, the number of Shares to be withdrawn and the name of the
registered holder, if different from that of the person who tendered such
Shares. If certificates evidencing the Shares to be withdrawn have been
delivered or otherwise identified to the Depositary, then, prior to the physical
release of such certificates, the serial numbers shown on such certificates must
be submitted to the Depositary and the signature(s) on the notice of withdrawal
must be guaranteed by an Eligible Institution (as defined in Section 3 of the
Offer to Purchase), unless such Shares have been tendered for the account of an
Eligible Institution. If Shares have been tendered pursuant to the procedure for
book-entry transfer as set forth in Section 3 of the Offer to Purchase, any
notice of withdrawal must specify the name and number of the account at the
Book-Entry Transfer Facility (as defined in Section 2 of the Offer to Purchase)
to be credited with the withdrawn Shares. All questions as to the form and
validity (including time of receipt) of any notice of withdrawal will be
determined by the Purchaser, in its sole discretion, whose determination will be
final and binding. Any Shares properly withdrawn will be deemed not validly
tendered for purposes
<PAGE>
of the Offer, but may be re-tendered at any subsequent time prior to the
Expiration Date by following any of the procedures described in Section 3 of the
Offer to Purchase.
The information required to be disclosed by Rule 14d-6(e)(1)(vii) of the
General Rules and Regulations under the Securities Exchange Act of 1934, as
amended, is contained in the Offer to Purchase and is incorporated herein by
reference.
The Company has provided the Purchaser with the Company's stockholder lists
and security position listings for the purpose of disseminating the Offer to
holders of Shares. The Offer to Purchase, the 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 stockholder list or, if applicable, who are
listed as participants in a clearing agency's security position listing, for
subsequent transmittal to beneficial owners of Shares.
THE OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION AND SHOULD BE READ CAREFULLY AND IN THEIR ENTIRETY BEFORE
ANY DECISION IS MADE WITH RESPECT TO THE OFFER.
Questions and requests for assistance may be directed to the Information
Agent or the Dealer Manager as set forth below. Requests for copies of the Offer
to Purchase, the related Letter of Transmittal and other tender offer materials
also may be directed to the Information Agent, and copies will be furnished
promptly at the Purchaser's expense. Neither Laidlaw nor the Purchaser will pay
any fees or commissions to any broker or dealer or any other person (other than
the Information Agent, the Dealer Manager and the Depositary) in connection with
the solicitation of tenders of Shares pursuant to the Offer.
THE INFORMATION AGENT FOR THE OFFER IS:
MORROW & CO., INC.
909 Third Avenue
20th Floor
New York, New York 10022
(212) 754-8000
Toll Free (800) 566-9061
Banks and Brokerage Firms please call:
(800) 662-5200
THE DEALER MANAGER FOR THE OFFER IS:
MERRILL LYNCH & CO.
World Financial Center
North Tower
New York, New York 10281
(212) 449-8209 (call collect)
<PAGE>
LAIDLAW TO MAKE CASH OFFER FOR AMERICAN MEDICAL RESPONSE;
SEPARATE ITS ENVIRONMENTAL SERVICES BUSINESS
January 6, 1997...Burlington, Ontario. Laidlaw Inc. (NYSE:LDW.B) has announced
two transactions which will see it substantially enlarge its emergency
healthcare business and strengthen and separate its environmental services
business. Value of the transactions is in excess of $2 billion (U.S.).
Laidlaw says it plans to merge its San Diego, California-based MedTrans
ambulance services unit with American Medical Response Inc. (AMR) -- (NYSE:EMT)
- -- through a $1.12 billion cash tender offer of $40.00 for each of the
approximately 28 million AMR common shares outstanding on a fully diluted basis.
AMR, based in Aurora, Colorado, a suburb of Denver, is the leading operator in
the healthcare transportation industry with current annualized net revenue of
approximately $725 million compared with MedTrans' $600 million. The
transaction will be immediately accretive to Laidlaw's earnings.
AMR and Laidlaw have signed a merger agreement pursuant to which Laidlaw will
commence a tender offer within five business days from today. AMR's Board of
Directors has received a fairness opinion from Smith Barney, Inc., its financial
advisor and are recommending all AMR shareholders accept Laidlaw's offer.
Merrill Lynch & Co., Inc. is acting as advisor to Laidlaw. It is expected the
transaction will be completed in February. The transaction is subject to the
tender of a minimum of two-thirds of AMR's voting shares and other customary
conditions, including normal regulatory approvals.
The combined entity will operate as American Medical Response Inc. and remain
headquartered in Aurora with Paul T. Shirley, currently president and chief
executive officer of AMR, continuing in that role. Synergies derived from the
elimination of duplicative head office functions, along with expected operating
efficiencies, will exceed $20 million annually.
Since its initial public offering in 1992, AMR has acquired in excess of 70
ambulance companies. Its 12,000 employees now operate more than 2,500 vehicles
in 27 states. MedTrans, acquired by Laidlaw in mid-1993, has grown to encompass
over 80 ambulance companies. Its 10,000 employees operate 2,200 vehicles in 23
states. Both companies provide a variety of emergency and non-emergency medical
transportation and allied services to municipalities, healthcare payors and
individuals through subscription plans. Combined, the two companies will have
about a 14% market share of the $10 billion healthcare transportation industry.
Laidlaw also says it has signed a letter of intent to sell its Columbia, South
Carolina-headquartered Environmental Services unit to Rollins Environmental
Services, Inc. (NYSE:REN) of Wilmington, Delaware. Under the terms of the
letter, unanimously approved by the boards of both companies, Laidlaw and
Rollins will each contribute their environmental services assets and businesses
into a "new Rollins".
Laidlaw will receive $400 million in cash, 120 million common shares of Rollins,
and a $350 million, 12-year, 5% convertible debenture.
Upon completion of the transaction, Laidlaw will own 66% of the equity in the
combined operation, expected to generate in excess of $900 million in annual
revenue.
With the completion of the transaction, anticipated to close in early April
1997, the company will be renamed Laidlaw Environmental Services Inc. and
continue to trade on The New York Stock Exchange. Kenneth W. Winger, currently
president and chief operating officer of Laidlaw Environmental Services will be
named president and chief executive officer of the new entity which will be
headquartered in Columbia, South Carolina.
<PAGE>
The combined operation will provide customers with local service from more than
100 locations in the U.S. and Canada, including nine incineration facilities, 32
transfer/service centers, six wastewater treatment plants, 10 fuels blending
facilities, six PCB treatment facilities and 13 landfills.
A significant reduction in general overhead and operating costs will be realized
with the elimination of duplication in head office functions and processing
facilities and through the integration of sales and field operating staff.
These savings, estimated to be at least $75 million per annum, will be achieved
primarily through the closure of a number of redundant facilities. As a result,
the new entity can be highly efficient in terms of matching available business
volumes with facility capacities.
Rollins Environmental Services, founded in 1968 is the major supplier of
incineration services in the United States, generating annual revenue of $241
million. Laidlaw Environmental is the largest supplier of general hazardous
waste management services in North America operating in 26 states and seven
provinces with revenue of $716 million.
The transaction is subject to normal regulatory considerations and to the
execution of a definitive agreement and a vote of Rollins shareholders at a
special meeting expected to be held in March. A commitment for a $650 million
credit facility has been arranged for the new Rollins with the Toronto Dominion
Bank as the arranging agent.
Commenting on these initiatives, James R. Bullock, Laidlaw's President and CEO
said,
"Through these transactions we have substantially strengthened Laidlaw's
focus on its transportation-related businesses -- school busing, municipal
transit and healthcare transportation. The purchase of AMR combines the
industry's top two healthcare transportation firms. It more than doubles
Laidlaw's participation in a growing industry which we will expand beyond
traditional transportation into a variety of related emergency and non-
emergency healthcare services. AMR extends our reach into 11 new states
and our service capability to include emergency physician and disease
management services. It broadens our ability to respond to both the
emergency and non-emergency service needs of health maintenance
organizations. While medical transportation will be the core of the
business for some time, these allied medical services represent a $30
billion annual market offering dramatic growth opportunities to Laidlaw
with its new, national presence in the industry.
The sale of our Environment Services operations offers Laidlaw and Rollins
shareholders the opportunity to participate in the growth of a well-
capitalized, stronger, independent, publicly traded entity, dedicated to
serving customers in the North American environmental services market. The
new combined company should be able to take advantage of its unique match
of facilities, operating with higher volumes and better utilization and as
a result, much better financial performance."
Laidlaw Inc. is a major provider of transportation and environmental services
to municipalities and industries throughout the United States and Canada.
Shares are listed on the New York, Toronto and Montreal stock exchanges.
Contact: T.A.G. Watson Vice President, Communications
Laidlaw Inc.
(905) 336-1865 ext. 309
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<PAGE>
Exhibit 1
================================================================================
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
LAIDLAW INC.,
MEDTRANS ACQUISITION CO.
and
AMERICAN MEDICAL RESPONSE, INC.
Dated as of January 6, 1997
================================================================================
<PAGE>
TABLE OF CONTENTS
ARTICLE I
THE OFFER
SECTION 1.1 The Offer ................................................2
SECTION 1.2 Company Action. ..........................................3
SECTION 1.3 Boards of Directors and Committees; Section 14(f) ........4
ARTICLE II
THE MERGER
SECTION 2.1 The Merger ...............................................5
SECTION 2.2 Effective Time. ..........................................6
SECTION 2.3 Effect of the Merger. ....................................6
SECTION 2.4 Certificate of Incorporation, By-Laws. ...................6
SECTION 2.5 Directors and Officers. ..................................7
SECTION 2.6 Effect on Capital Stock. .................................7
SECTION 2.7 Exchange of Certificates. ................................8
SECTION 2.8 Stock Transfer Books. ....................................9
SECTION 2.9 No Further Ownership Rights in Company Common Stock. .....9
SECTION 2.10 Lost, Stolen or Destroyed Certificates. ................10
SECTION 2.11 Taking of Necessary Action; Further Action. ............10
SECTION 2.12 Stockholders' Meeting ..................................10
SECTION 2.13 Material Adverse Effect. ...............................11
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
SECTION 3.1 Organization and Qualification; Subsidiaries. ...........11
SECTION 3.2 Certificate of Incorporation and By-Laws. ...............12
SECTION 3.3 Capitalization. .........................................12
SECTION 3.4 Authority Relative to this Agreement. ...................13
SECTION 3.5 No Conflict; Required Filings and Consents. .............13
SECTION 3.6 Compliance, Permits. ....................................14
SECTION 3.7 SEC Filings; Financial Statements. ......................15
SECTION 3.8 Absence of Certain Changes or Events. ...................15
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<PAGE>
SECTION 3.9 No Undisclosed Liabilities. .............................16
SECTION 3.10 Absence of Litigation. .................................16
SECTION 3.11 Employee Benefit Plans, Employment Agreements. .........16
SECTION 3.12 Labor Matters. .........................................18
SECTION 3.13 Schedule 14D-9; Offer Documents; Proxy Statement. ......18
SECTION 3.14 Restrictions on Business Activities. ...................19
SECTION 3.15 Title to Property. .....................................19
SECTION 3.16 Taxes. .................................................19
SECTION 3.17 Environmental Matters. .................................20
SECTION 3.18 Intellectual Property. .................................21
SECTION 3.19 Interested Party Transactions. .........................22
SECTION 3.20 Insurance. .........................................22
SECTION 3.21 Healthcare Regulatory Compliance. ......................22
SECTION 3.22 Opinion of Financial Advisor. ..........................23
SECTION 3.23 Brokers. ...............................................23
SECTION 3.24 Section 203 of the Delaware Law Not Applicable .........23
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT AND ACQUISITION
SECTION 4.1 Organization and Qualification; Subsidiaries ............24
SECTION 4.2 Authority Relative to this Agreement. ...................24
SECTION 4.3 No Conflict, Required Filings and Consents. .............24
SECTION 4.4 Offer Documents; Schedule 14D-9; Proxy Statement. .......25
SECTION 4.5 No Prior Activities; Financing. .........................25
ARTICLE V
CONDUCT OF BUSINESS PENDING THE MERGER
SECTION 5.1 Conduct of Business by the Company Pending the Merger. ..26
SECTION 5.2 No Solicitation. ........................................29
ARTICLE VI
ADDITIONAL AGREEMENTS
SECTION 6.1 HSR Act .................................................30
SECTION 6.2 Access to Information; Confidentiality. .................30
SECTION 6.3 Consents; Approvals. ....................................30
SECTION 6.4 Indemnification and Insurance. ..........................31
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<PAGE>
SECTION 6.5 Notification of Certain Matters. ........................32
SECTION 6.6 Further Action ..........................................33
SECTION 6.7 Public Announcements. ...................................33
SECTION 6.8 Conveyance Taxes. .......................................33
ARTICLE VII
CONDITIONS TO THE MERGER
SECTION 7.1 Conditions to Obligation of Each Party to Effect
the Merger ...........................................................33
ARTICLE VIII
TERMINATION
SECTION 8.1 Termination .............................................34
SECTION 8.2 Effect of Termination ...................................35
SECTION 8.3 Fees and Expenses .......................................35
ARTICLE IX
GENERAL PROVISIONS
SECTION 9.1 Effectiveness of Representations, Warranties and
Agreements; Knowledge, Etc............................................36
SECTION 9.2 Notices .................................................37
SECTION 9.3 Certain Definitions .....................................37
SECTION 9.4 Amendment ...............................................38
SECTION 9.5 Waiver ..................................................39
SECTION 9.6 Headings ................................................39
SECTION 9.7 Severability.............................................39
SECTION 9.8 Entire Agreement.........................................39
SECTION 9.9 Assignment; Guarantee of Acquisition ....................39
SECTION 9.10 Parties in Interest ....................................39
SECTION 9.11 Failure or Indulgence Not Waiver; Remedies Cumulative ..39
SECTION 9.12 Governing Law ..........................................40
SECTION 9.13 Counterparts ...........................................40
-iii-
<PAGE>
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER, dated as of January 6, 1997, is among
American Medical Response, Inc., a Delaware corporation (the "Company"), Laidlaw
Inc., a Canadian corporation ("Parent") and MedTrans Acquisition Co., a Delaware
corporation and a wholly owned subsidiary of Parent ("Acquisition").
WHEREAS, the Board of Directors of Parent, Acquisition and the Company have
each approved the acquisition of the Company by Parent upon the terms and
subject to the conditions set forth in this Agreement;
WHEREAS, in furtherance thereof, it is proposed that Acquisition shall make
a tender offer to acquire all outstanding shares (the "Shares") of common stock,
par value $0.01 per share, of the Company (the "Common Stock") for a cash amount
of $40.00 per Share (such amount, or any greater amount per Share paid pursuant
to the tender offer, being hereinafter referred to as the "Per Share Amount") in
accordance with the terms and subject to the conditions provided for herein (the
"Offer");
WHEREAS, the Board of Directors of the Company (the "Board") has (i)
determined that the consideration to be paid for each Share in the Offer and the
Merger (as defined below) is fair to and in the best interests of the
stockholders of the Company and (ii) approved this Agreement and the
transactions contemplated hereby and resolved to recommend acceptance of the
Offer and approval and adoption of this Agreement by the stockholders of the
Company; and
WHEREAS, the Boards of Directors of Parent and Acquisition have each
approved the merger (the "Merger") of Acquisition with and into the Company
following the Offer in accordance with the Delaware General Corporation Law (the
"Delaware Law") upon the terms and subject to the conditions set forth herein.
NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
and agreements herein contained, and intending to be legally bound hereby, the
Company, Parent and Acquisition hereby agree as follows:
<PAGE>
ARTICLE I
THE OFFER
SECTION 1.1 The Offer.
(a) Commencement. Provided that this Agreement shall not have been
terminated in accordance with Section 8.1, as promptly as practicable, but in
any event within five business days of the public announcement of the terms of
this Agreement, Acquisition shall commence the Offer. The obligation of
Acquisition to accept for payment and pay for Shares tendered pursuant to the
Offer shall be subject to the condition that a number of Shares representing not
less than two-thirds of the Company's outstanding voting power (assuming the
exercise of all outstanding options to purchase shares of Common Stock the
holders of which have not entered into an agreement to cancel such options as
described in Section 2.6(c)(i) and the conversion of all of the Company's 5 1/4%
Convertible Subordinated Notes due February 1, 2001 (the "Notes")) shall have
been validly tendered and not withdrawn prior to the expiration date of the
Offer (the "Minimum Condition"), and the obligation of Acquisition to accept for
payment and pay for Shares tendered pursuant to the Offer shall be subject to
the other conditions set forth in Annex A hereto. It is agreed that the Minimum
Condition and the other conditions set forth in Annex A hereto are for the sole
benefit of Acquisition and may be asserted by Acquisition regardless of the
circumstances giving rise to any such condition unless Parent, Acquisition or
their affiliates shall have caused the circumstances giving rise to such
condition. Acquisition expressly reserves the right in its sole discretion to
waive, in whole or in part, at any time or from time to time, any such condition
(other than the Minimum Condition, which may not be waived without the prior
written consent of the Company), to increase the price per Share payable in the
Offer or to make any other changes in the terms and conditions of the Offer;
provided that, unless previously approved by the Company in writing, no change
may be made that decreases the price per Share payable in the Offer, changes the
form of consideration payable in the Offer, reduces the maximum number of Shares
to be purchased in the Offer or imposes conditions to the Offer in addition to
those set forth in Annex A hereto. Acquisition covenants and agrees that,
subject to the conditions of the Offer set forth in Annex A hereto, Acquisition
shall accept for payment and pay for Shares which have been validly tendered and
not withdrawn pursuant to the Offer as soon as it is permitted to do so under
applicable law; provided that, if the number of Shares that have been validly
tendered and not withdrawn represent less than 90% of the Company's outstanding
voting power (calculated as described above), Acquisition may extend the Offer
up to the tenth business day following the date on which all conditions to the
Offer shall first have been satisfied or waived. The Per Share Amount payable
in the Offer shall be paid net to the seller in cash, upon the terms and subject
to the conditions of the Offer. Acquisition agrees that if all conditions set
forth in Annex A are not satisfied on the initial expiration date of the Offer,
Acquisition shall extend (and re-extend) the Offer through April 15, 1997 to
provide time to satisfy such conditions; provided that, if Acquisition shall not
have purchased Shares pursuant to the Offer prior to April 15, 1997 as the
result of the receipt by the Company of an
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<PAGE>
Acquisition Proposal (as defined below) or as a result of a failure of the
applicable waiting period under the HSR Act (as defined below) to expire or the
failure to obtain any necessary governmental or regulatory approvals,
Acquisition shall extend (and re-extend) the Offer through July 15, 1997.
(b) Filing Offer Documents. As soon as practicable on the date of
commencement of the Offer, Parent and Acquisition shall file with the Securities
and Exchange Commission (the "SEC") a Tender Offer Statement on Schedule 14D-1
with respect to the Offer which will contain the offer to purchase and form of
the related letter of transmittal (together with any supplements or amendments
thereto, the "Offer Documents"). Parent, Acquisition and the Company each
agrees promptly to correct any information provided by it for use in the Offer
Documents if and to the extent that any such information shall have become false
or misleading in any material respect and Parent and Acquisition each further
agrees to take all steps necessary to cause the Offer Documents as so corrected
to be filed with the SEC and to be disseminated to holders of Shares, in each
case as and to the extent required by applicable federal securities laws. The
Company and its counsel shall be given a reasonable opportunity to review and
comment on the Offer Documents prior to their filing with the SEC and shall be
provided with any comments Parent, Acquisition and their counsel may receive
from the SEC or its staff with respect to the Offer Documents promptly after
receipt of such comments.
SECTION 1.2 Company Action.
(a) Board Approval. The Company hereby approves of and consents to the
Offer and represents and warrants that the Board, at a meeting duly called and
held on January 5, 1997, unanimously (i) determined that this Agreement and the
transactions contemplated hereby, including the Offer and the Merger, are fair
to and in the best interests of the stockholders of the Company, (ii) approved
this Agreement and the transactions contemplated hereby, including the Offer and
the Merger and (iii) resolved to recommend that the stockholders of the Company
accept the Offer, tender their Shares thereunder to Acquisition and, if required
by applicable law, approve and adopt this Agreement and the Merger. The Company
further represents and warrants that Smith Barney Inc. ("Smith Barney") has
delivered to the Board its opinion to the effect that, as of the date of this
Agreement, the Per Share Amount to be received by the holders of Shares (other
than Parent and its affiliates) pursuant to the Offer and the Merger, taken
together, is fair to such holders from a financial point of view. The Company
has been authorized by Smith Barney to permit the inclusion of such opinion in
its entirety in the Offer Documents and the Schedule 14D-9 referred to below and
the Proxy Statement referred to in Section 3.13, so long as such inclusion is in
form and substance reasonably satisfactory to Smith Barney and its counsel.
Subject to the fiduciary duties of the Board under applicable law (as determined
in good faith after consultation with independent counsel), the Company hereby
consents to the inclusion in the Offer Documents of the recommendations of the
Board described in this Section 1.2(a).
-3-
<PAGE>
(b) Schedule 14D-9. As soon as practicable on the date of commencement of
the Offer, the Company shall file with the SEC a Solicitation/Recommendation
Statement on Schedule 14D-9 (together with any amendments or supplements
thereto, the "Schedule 14D-9") and shall mail the Schedule 14D-9 to the
stockholders of the Company promptly after the commencement of the Offer. The
Schedule 14D-9 shall, subject to the fiduciary duties of the Board under
applicable law (as determined in good faith after consultation with independent
counsel), at all times contain the determinations, approvals and recommendations
described in Section 1.2(a). Parent, Acquisition and the Company each agrees
promptly to correct any information provided by it for use in the Schedule 14D-9
if and to the extent that any such information shall have become false or
misleading in any material respect and the Company further agrees to take all
steps necessary to cause the Schedule 14D-9 as so corrected to be filed with the
SEC and to be disseminated to holders of Shares, in each case as and to the
extent required by applicable federal securities laws. Parent, Acquisition and
their counsel shall be given a reasonable opportunity to review and comment on
the Schedule 14D-9 prior to its filing with the SEC and shall be provided with
any comments the Company and its counsel may receive from the SEC or its staff
with respect to the Schedule 14D-9 promptly after receipt of such comments.
(c) Dissemination of the Offer. In connection with the Offer, the Company
will promptly furnish Acquisition with mailing labels, security position
listings and any available listing or computer file containing the names and
addresses of the record holders of the Shares as of a recent date and shall
furnish Acquisition with such additional information and assistance (including,
without limitation, updated lists of stockholders, mailing labels and lists of
securities positions) as Acquisition or its agents may reasonably request in
communicating the Offer to the record and beneficial holders of Shares. Subject
to the requirements of applicable law, and except for such steps as are
necessary to disseminate the Offer Documents and any other documents necessary
to consummate the Merger, Acquisition and its affiliates and associates shall
hold in confidence the information contained in any such labels, listings and
files, will use such information only in connection with the Offer and the
Merger, and, if this Agreement shall be terminated, will deliver to the Company
all copies of such information then in their possession.
SECTION 1.3 Boards of Directors and Committees; Section 14(f).
(a) Board Representation. Promptly upon the purchase by Acquisition of
Shares pursuant to the Offer and from time to time thereafter, Acquisition shall
be entitled to designate up to such number of directors, rounded up to the next
whole number, on the Board that equals the product of (i) the total number of
directors on the Board (giving effect to the election of any additional
directors pursuant to this Section) and (ii) the percentage that the number of
Shares owned by Acquisition and its affiliates (including any Shares purchased
pursuant to the Offer) bears to the total number of outstanding Shares, and the
Company shall, upon request by Acquisition, subject to the provisions of Section
1.3(b), promptly either
-4-
<PAGE>
increase the size of the Board (and shall, if necessary, amend the Company's By-
Laws to permit such an increase) or use its reasonable best efforts to secure
the resignation of such number of directors as is necessary to enable
Acquisition's designees to be elected to the Board and shall cause Acquisition's
designees to be so elected. Promptly upon request by Acquisition, the Company
will, subject to the provisions of Section 1.3(b), use its reasonable best
efforts to cause persons designated by Acquisition to constitute the same
percentage as the number of Acquisition's designees to the Board bears to the
total number of directors on the Board on (i) each committee of the Board, (ii)
each board of directors or similar governing body or bodies of each subsidiary
of the Company designated by Acquisition and (iii) each committee of each such
board or body.
(b) Compliance with Section 14(f). The Company's obligations to appoint
designees to the Board shall be subject to Section 14(f) of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), and Rule 14f-1
promulgated thereunder. The Company shall promptly take all actions required
pursuant to Section 14(f) and Rule 14f-1 in order to fulfill its obligations
under this Section 1.3 and shall include in the Schedule 14D-9 or a separate
Rule 14f-1 Statement provided to shareholders such information with respect to
the Company and its officers and directors as is required under Section 14(f)
and Rule 14f-1. Parent or Acquisition will supply to the Company in writing and
be solely responsible for any information with respect to either of them and
their nominees, officers, directors and affiliates required by Section 14(f) and
Rule 14f-1.
(c) Action by Disinterested Directors. Following the election or
appointment of Acquisition's designees pursuant to this Section 1.3 and prior to
the Effective Time (as defined below), any amendment of this Agreement or any
amendment to the Restated Certificate of Incorporation or By-Laws of the Company
inconsistent with this Agreement, any termination of this Agreement by the
Company, any extension by the Company of the time for the performance of any of
the obligations or other acts of Parent or Acquisition or any waiver of any of
the Company's rights hereunder will require the concurrence of a majority of the
directors of the Company then in office who are not designees of Acquisition or
employees of the Company.
ARTICLE II
THE MERGER
SECTION 2.1 The Merger.
(a) Effective Time. At the Effective Time (as defined below), and subject
to and upon the terms and conditions of this Agreement and the Delaware Law,
Acquisition shall be merged with and into the Company, the separate corporate
existence of Acquisition shall cease, and the Company shall continue as the
surviving corporation. The Company as the
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surviving corporation after the Merger is hereinafter sometimes referred to as
the "Surviving Corporation."
(b) Closing. Unless this Agreement shall have been terminated and the
transactions herein contemplated shall have been abandoned pursuant to Section
8.1 and subject to the satisfaction or waiver of the conditions set forth in
Article VII, the consummation of the Merger will take place as promptly as
practicable (and in any event within two business days) after satisfaction or
waiver of the conditions set forth in Article VII, at the offices of Ropes &
Gray, One International Place, Boston, Massachusetts, unless another date, time
or place is agreed to in writing by the parties hereto.
SECTION 2.2 Effective Time. As promptly as practicable after the
satisfaction or waiver of the conditions set forth in Article VII, the parties
hereto shall cause the Merger to be consummated by filing a certificate of
merger as contemplated by the Delaware Law (the "Certificate of Merger"),
together with any required related certificates, with the Secretary of State of
the State of Delaware, in such form as required by, and executed in accordance
with the relevant provisions of, the Delaware Law (the time of such filing being
the "Effective Time").
SECTION 2.3 Effect of the Merger. At the Effective Time, the effect of
the Merger shall be as provided in this Agreement, the Certificate of Merger and
the applicable provisions of the Delaware Law. Without limiting the generality
of the foregoing, and subject thereto, at the Effective Time all the property,
rights, privileges, powers and franchises of the Company and Acquisition shall
vest in the Surviving Corporation, and all debts, liabilities and duties of the
Company and Acquisition shall become the debts, liabilities and duties of the
Surviving Corporation.
SECTION 2.4 Certificate of Incorporation, By-Laws.
(a) Certificate of Incorporation. Unless otherwise determined by
Parent prior to the Effective Time, at the Effective Time the Certificate of
Incorporation of Acquisition, as in effect immediately prior to the Effective
Time, shall be the Certificate of Incorporation of the Surviving Corporation
until thereafter amended as provided by the Delaware Law and such Certificate
of Incorporation; provided, however, that at the Effective Time Article I of
the Certificate of Incorporation of Acquisition shall be amended to change
its name to "American Medical Response, Inc."
(b) By-Laws. The By-Laws of Acquisition, as in effect immediately prior
to the Effective Time, shall be the By-Laws of the Surviving Corporation until
thereafter amended as provided by the Delaware Law, the Certificate of
Incorporation of the Surviving Corporation and such By-Laws.
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SECTION 2.5 Directors and Officers. The directors of Acquisition
immediately prior to the Effective Time shall be the initial directors of the
Surviving Corporation, each to hold office in accordance with the Certificate of
Incorporation and By-Laws of the Surviving Corporation, and the officers of
Acquisition immediately prior to the Effective Time shall be the initial
officers of the Surviving Corporation, in each case until their respective
successors are duly elected or appointed and qualified.
SECTION 2.6 Effect on Capital Stock. At the Effective Time, by virtue of
the Merger and without any action on the part of the Parent, Acquisition, the
Company or the holders of any of the following securities:
(a) Conversion of Securities. Each Share issued and outstanding
immediately prior to the Effective Time (excluding any Shares to be canceled
pursuant to Section 2.6(b)) shall be converted into the right to receive the Per
Share Amount (the "Merger Consideration").
(b) Cancellation. Each Share held in the treasury of the Company and each
Share owned by Parent, Acquisition or any direct or indirect wholly owned
subsidiary of the Company or Parent immediately prior to the Effective Time
shall, by virtue of the Merger and without any action on the part of the holder
thereof, cease to be outstanding, be canceled and retired without payment of any
consideration therefor and cease to exist.
(c) Stock Options and Employee Stock Purchase Plan.
(i) On the date Acquisition purchases Shares pursuant to the
Offer, each outstanding option to purchase Company Common Stock (a "Stock
Option") granted under the Company's 1992 Equity Incentive Plan, the 1992 Stock
Option Plan for Non-Employee Directors and the Acquisition Stock Option Plan and
the 1996 Stock Incentive Plan of STAT Healthcare, Inc. (the "Company Stock
Option Plans") or pursuant to any other employee stock option plan or agreement
entered into by the Company with any employee of the Company or any subsidiary
thereof listed on Section 3.11(c) of the Company Disclosure Schedule, whether or
not then exercisable, shall become exercisable, and each holder of a Stock
Option who executes an agreement to cancel such Stock Option shall be entitled
to receive as soon as practicable thereafter from the Company in consideration
for such cancellation an amount in cash (less applicable withholding taxes)
equal to the product of (i) the number of shares of Company Common Stock
previously subject to such Stock Option multiplied by (ii) the excess, if any,
---------- --
of the Per Share Amount over the exercise price per share of Company Common
Stock previously subject to such Stock Option.
(ii) The Board of Directors of the Company, or an appropriate
committee thereof, shall promptly cause written notice of this Agreement to be
given to persons holding options or other rights to purchase Company Common
Stock ("Purchase Rights") under the Company's 1992 Employee Stock Purchase Plan
(the "Company
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Stock Purchase Plan"). On the date that Acquisition purchases Shares pursuant
to the Offer, all Purchase Rights shall be accelerated and shall be exercised
automatically for shares of Company Common Stock as if the date of this
Agreement were the end of an Option Period (as defined in the Company Stock
Purchase Plan) unless a Participant (as defined in the Company Stock Purchase
Plan) withdraws from the Company Stock Purchase Plan. Payroll deductions under
the Company Stock Purchase Plan not used to purchase shares of Company Common
Stock shall be returned to the Participant.
(d) Capital Stock of Acquisition. Each share of common stock, $.01 par
value, of Acquisition issued and outstanding immediately prior to the Effective
Time shall be converted into and exchanged for one validly issued, fully paid
and nonassessable share of common stock, $.01 par value, of the Surviving
Corporation.
SECTION 2.7 Exchange of Certificates.
(a) Exchange Agent and Procedures. Prior to the Effective Time, a bank or
trust company shall be designated by Parent (the "Paying Agent") to act as agent
in connection with the Merger to receive the funds to which holders of Shares
shall become entitled pursuant to Section 2.6(a). Promptly after the Effective
Time, the Surviving Corporation shall cause to be mailed to each record holder,
as of the Effective Time, of a certificate or certificates (the"Certificates")
that, prior to the Effective Time, represented Shares, a form of letter of
transmittal and instructions for use in effecting the surrender of the
Certificates for payment of the Merger Consideration therefor. Upon the
surrender of each such Certificate formerly representing Shares, together with
such letter of transmittal, duly completed and validly executed in accordance
with the instructions thereto, the Paying Agent shall pay the holder of such
Certificate the Merger Consideration multiplied by the number of Shares formerly
represented by such Certificate, in exchange therefor, and such Certificate
shall forthwith be canceled. Until so surrendered and exchanged, each such
Certificate (other than Shares held by Parent, Acquisition or the Company, or
any direct or indirect subsidiary thereof) shall represent solely the right to
receive the Merger Consideration. No interest shall be paid or accrue on the
Merger Consideration. If the Merger Consideration (or any portion thereof) is
to be delivered to any person other than the person in whose name the
Certificate formerly representing Shares surrendered in exchange therefor is
registered, it shall be a condition to such exchange that the Certificate so
surrendered shall be properly endorsed or otherwise be in proper form for
transfer and that the person requesting such exchange shall pay to the Paying
Agent any transfer or other taxes required by reason of the payment of the
Merger Consideration to a person other than the registered holder of the
Certificate surrendered, or shall establish to the satisfaction of the Paying
Agent that such tax has been paid or is not applicable.
(b) Consideration. When and as needed, Parent or Acquisition shall
deposit, or cause to be deposited, in trust with the Paying Agent the Merger
Consideration to which holders of Shares shall be entitled at the Effective Time
pursuant to Section 2.6(a) hereof.
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(c) Investment of Merger Consideration. The Merger Consideration shall be
invested by the Paying Agent, as directed by Parent, provided such investments
shall be limited to direct obligations of the United States of America,
obligations for which the full faith and credit of the United States of America
is pledged to provide for the payment of principal and interest, commercial
paper rated of the highest quality by Moody's Investors Service, Inc. or
Standard & Poor's Corporation, or certificates of deposit issued by a commercial
bank having at least $1,000,000,000 in assets.
(d) Termination of Duties. Promptly following the date which is six
months after the Effective Time, Parent will cause the Paying Agent to deliver
to the Surviving Corporation all cash and documents in its possession relating
to the transactions described in this Agreement, and the Paying Agent's duties
shall terminate. Thereafter, each holder of a Certificate formerly representing
a Share may surrender such Certificate to the Surviving Corporation and (subject
to applicable abandoned property, escheat and similar laws) receive in exchange
therefor the Merger Consideration, without any interest thereon.
(e) No Liability. Neither Parent, Acquisition nor the Company shall be
liable to any holder of Company Common Stock for any Merger Consideration
delivered to a public official pursuant to any applicable abandoned property,
escheat or similar law.
(f) Withholding Rights. Parent or the Exchange Agent shall be entitled
to deduct and withhold from the Merger Consideration otherwise payable pursuant
to this Agreement to any holder of Company Common Stock such amounts as Parent
or the Exchange Agent is required to deduct and withhold with respect to the
making of such payment under the Internal Revenue Code of 1986, as amended (the
"Code"), or any provision of state, local or foreign tax law. To the extent that
amounts are so withheld by Parent or the Exchange Agent, such withheld amounts
shall be treated for all purposes of this Agreement as having been paid to the
holder of the Shares in respect of which such deduction and withholding was made
by Parent or the Exchange Agent.
SECTION 2.8 Stock Transfer Books. At the Effective Time, the stock
transfer books of the Company shall be closed, and there shall be no further
registration of transfers of the Company Common Stock thereafter on the records
of the Company.
SECTION 2.9 No Further Ownership Rights in Company Common Stock. The
Merger Consideration delivered upon the surrender for exchange of Shares in
accordance with the terms hereof shall be deemed to have been issued in full
satisfaction of all rights pertaining to such Shares, and there shall be no
further registration of transfers on the records of the Surviving Corporation of
Shares which were outstanding immediately prior to the Effective Time. If,
after the Effective Time, Certificates are presented to the Surviving
Corporation for any reason, they shall be canceled and exchanged as provided in
this Article II.
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SECTION 2.10 Lost, Stolen or Destroyed Certificates. In the event any
Certificates shall have been lost, stolen or destroyed, the Exchange Agent shall
deliver in exchange for such lost, stolen or destroyed Certificates, upon the
making of an affidavit of that fact by the holder thereof, the Merger
Consideration such Parent Shares as may be required pursuant to Section 2.6;
provided, however, that Parent may, in its discretion and as a condition
precedent to the issuance thereof, require the owner of such lost, stolen or
destroyed Certificates to deliver a bond in such sum as it may reasonably direct
as indemnity against any claim that may be made against Parent or the Exchange
Agent with respect to the Certificates alleged to have been lost, stolen or
destroyed.
SECTION 2.11 Taking of Necessary Action; Further Action. Each of Parent,
Acquisition and the Company will take all such reasonable and lawful action as
may be necessary or appropriate in order to effectuate the Merger in accordance
with this Agreement as promptly as possible. If, at any time after the
Effective Time, any such further action is necessary or desirable to carry out
the purposes of this Agreement and to vest the Surviving Corporation with full
right, title and possession to all assets, property, rights, privileges, powers
and franchises of the Company and Acquisition, the officers and directors of the
Company and Acquisition immediately prior to the Effective Time are fully
authorized in the name of their respective corporations or otherwise to take,
and will take, all such lawful and necessary action.
SECTION 2.12 Stockholders' Meeting. If approval by the Company's
stockholders is required by applicable law to consummate the Merger, the
Company, acting through the Board, shall in accordance with applicable law and
subject to the fiduciary duties of the Board under applicable law (as determined
in good faith after consultation with independent counsel), as soon as
practicable following the consummation of the Offer:
(i) duly call, give notice of, convene and hold an annual or special
meeting of its stockholders (the "Stockholders' Meeting") for the purpose
of considering and taking action upon this Agreement;
(ii) include in the Proxy Statement (as defined in Section 3.13) the
recommendation of the Board that stockholders of the Company vote in favor
of the approval and adoption of this Agreement and the transactions
contemplated hereby; and
(iii) use its reasonable best efforts (A) to obtain and furnish the
information required to be included by it in the Proxy Statement and, after
consultation with Parent, respond promptly to any comments made by the SEC
with respect to the Proxy Statement and any preliminary version thereof and
cause the Proxy Statement to be mailed to its stockholders at the earliest
practicable time following the consummation of the Offer and (B) to obtain
the necessary
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approvals by its stockholders of this Agreement and the transactions
contemplated hereby.
At such meeting, Parent and Acquisition will vote all Shares owned by them in
favor of this Agreement and the transactions contemplated hereby.
SECTION 2.13 Material Adverse Effect. When used in connection with the
Company or any of its subsidiaries, or Parent or any of its subsidiaries, as the
case may be, the term "Material Adverse Effect" means any change, effect or
circumstance that is materially adverse to the business, assets, financial
condition or results of operations of the Company and its subsidiaries, or
Parent and its subsidiaries, as the case may be, in each case taken as a whole,
other than any such changes, effects or circumstances: (i) set forth or
contemplated by the Company Disclosure Schedule or the Parent Disclosure
Schedule, as the case may be; (ii) set forth or described in the Company SEC
Reports or the Parent SEC Reports, as the case may be; or (iii) affecting the
ambulance service industry generally.
ARTICLE III
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to Parent and Acquisition that,
except as set forth in the written disclosure schedule delivered on or prior to
the date hereof by the Company to Parent that is arranged in paragraphs
corresponding to the numbered and lettered paragraphs contained in this Article
III (the "Company Disclosure Schedule"):
SECTION 3.1 Organization and Qualification; Subsidiaries. Each of the
Company and each of its subsidiaries is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation and has the requisite corporate power and authority and is in
possession of all franchises, grants, authorizations, licenses, permits,
easements, consents, certificates, approvals and orders ("Approvals") necessary
to own, lease and operate the properties it purports to own, operate or lease
and to carry on its business as it is now being conducted, except where the
failure to be so organized, existing and in good standing or to have such power,
authority and Approvals would not have a Material Adverse Effect. Each of the
Company and each of its subsidiaries is duly qualified or licensed as a foreign
corporation to do business, and is in good standing, in each jurisdiction where
the character of its properties owned, leased or operated by it or the nature of
its activities makes such qualification or licensing necessary, except for such
failures to be so duly qualified or licensed and in good standing that would not
have a Material Adverse Effect. A true and complete list of all of the
Company's subsidiaries, together with the jurisdiction of incorporation of each
subsidiary and the percentage of each subsidiary's outstanding capital stock
owned by the Company or another subsidiary, is set forth in Section 3.1 of the
Company Disclosure Schedule. Except as set forth in Section 3.1 of the Company
Disclosure Schedule,
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the Company does not directly or indirectly own any equity or similar interest
in, or any interest convertible into or exchangeable or exercisable for, any
equity or similar interest in, any corporation, partnership, joint venture or
other business association or entity, with respect to which interest the Company
or any of its subsidiaries has invested or is required to invest $500,000 or
more, excluding securities in any publicly traded company held for investment
and comprising less than five percent of the outstanding stock of such company.
SECTION 3.2 Certificate of Incorporation and By-Laws. The Company has
heretofore furnished to Parent a complete and correct copy of its Certificate of
Incorporation and By-Laws as most recently restated and subsequently amended to
date, and has furnished or made available to Parent the Certificate of
Incorporation and By-Laws (or equivalent organizational documents) of each of
its subsidiaries (the "Subsidiary Documents"). Such Certificate of
Incorporation, By-Laws and Subsidiary Documents are in full force and effect.
Neither the Company nor any of its subsidiaries is in violation of any of the
provisions of its Certificate of Incorporation or By-Laws or Subsidiary
Documents, except for immaterial violations of the Subsidiary Documents which
may exist.
SECTION 3.3 Capitalization. The authorized capital stock of the Company
consists of (i) 75,000,000 shares of Company Common Stock and (ii) 500,000
shares of preferred stock, $.01 par value per share, none of which is issued and
outstanding and none of which is held in treasury. As of December 31, 1996, (i)
21,047,345 shares of Company Common Stock were issued and outstanding, all of
which are validly issued, fully paid and nonassessable, and no shares were held
in treasury, (ii) no shares of Company Common Stock were held by subsidiaries of
the Company, (iii) 1,809,569 shares of Company Common Stock were reserved for
future issuance pursuant to outstanding stock options granted under the Company
Stock Option Plans and agreements listed in Section 3.3 of the Company
Disclosure Schedule, (iv) 189,611 shares of Company Common Stock were reserved
for future issuance under the Company Stock Purchase Plan,(v) 3,311,258 shares
of Company Common Stock were reserved for future issuance pursuant to the
conversion of the Notes and (vi) 3,919,900 shares of Company Common Stock were
issuable connection with the acquisition of STAT Healthcare. No material change
in such capitalization has occurred between December 31, 1996 and the date
hereof. Section 3.3 of the Company Disclosure Schedule sets forth a true and
complete list of all outstanding warrants and other rights for the purchase of
Company Common Stock (other than the Notes, Stock Options and Purchase Rights),
the name of each holder thereof, the number of shares purchasable thereunder or
upon conversion thereof and the per share exercise or conversion price of each
warrant and other right. Except as set forth in this Section 3.3 or Section
3.11 or in the related sections of the Company Disclosure Schedule, and other
than the Notes, there are no options, warrants or other similar rights,
agreements, arrangements or commitments of any character relating to the issued
or unissued capital stock of the Company or any of its subsidiaries or
obligating the Company or any of its subsidiaries to issue or sell any shares of
capital stock of, or other equity interests in, the Company or any of its
subsidiaries. All shares of Company Common Stock subject to issuance as
aforesaid, upon issuance on the terms and conditions specified in the
instruments
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pursuant to which they are issuable, shall be duly authorized, validly issued,
fully paid and nonassessable. Except as disclosed in Section 3.3 of the Company
Disclosure Schedule, there are no obligations, contingent or otherwise, of the
Company or any of its subsidiaries to repurchase, redeem or otherwise acquire
any shares of Company Common Stock or the capital stock of any subsidiary or to
provide funds to or make any investment (in the form of a loan, capital
contribution or otherwise) in any such subsidiary or any other entity other than
guarantees of bank obligations of subsidiaries entered into in the ordinary
course of business. Except as set forth in Sections 3.1 and 3.3 of the Company
Disclosure Schedule, all of the outstanding shares of capital stock of each of
the Company's subsidiaries is duly authorized, validly issued, fully paid and
nonassessable, and all such shares are owned by the Company or another
subsidiary of the Company free and clear of all security interests, liens,
claims, pledges, agreements, limitations in the Company's voting rights, charges
or other encumbrances of any nature whatsoever.
SECTION 3.4 Authority Relative to this Agreement. The Company has all
necessary corporate power and authority to execute and deliver this Agreement
and to perform its obligations hereunder and to consummate the transactions
contemplated hereby. The execution and delivery of this Agreement by the
Company and the consummation by the Company of the transactions contemplated
hereby have been duly and validly authorized by all necessary corporate action,
and no other corporate proceedings on the part of the Company are necessary to
authorize this Agreement or to consummate the transactions so contemplated
(other than the adoption of this Agreement by the holders of at least a majority
of the outstanding shares of Company Common Stock entitled to vote in accordance
with the Delaware Law and the Company's Certificate of Incorporation and By-
Laws). The Board of Directors of the Company has determined that the Offer and
the Merger upon the terms and subject to the conditions of this Agreement are
advisable and in the best interest of the Company's stockholders. This
Agreement has been duly and validly executed and delivered by the Company and,
assuming the due authorization, execution and delivery by Parent and
Acquisition, as applicable, constitutes a legal, valid and binding obligation of
the Company enforceable against the Company in accordance with its terms.
SECTION 3.5 No Conflict; Required Filings and Consents.
(a) Section 3.5(a) of the Company Disclosure Schedule includes a list of
all agreements to which the Company or any of its subsidiaries is a party or by
which any of them is bound which, as of the date hereof: (i) are required to be
filed as "material contracts" with the SEC pursuant to the requirements of the
Exchange Act; (ii) under which the consequences of a default, nonrenewal or
termination could have a Material Adverse Effect on the Company; or (iii)
pursuant to which payments might be required or acceleration of benefits may be
required upon a "change of control" of the Company (collectively, the "Material
Contracts").
(b) Except as set forth in Section 3.5(b) of the Company Disclosure
Schedule, the execution and delivery of this Agreement by the Company does not,
and the performance of
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this Agreement by the Company will not, (i) conflict with or violate the
Certificate of Incorporation or By-Laws of the Company, (ii) conflict with or
violate any law, rule, regulation, order, judgment or decree applicable to the
Company or any of its subsidiaries or by which its or any of their respective
properties is bound or affected, or (iii) result in any breach of or constitute
a default (or an event that with notice or lapse of time or both would become a
default) under, or impair the Company's or any of its subsidiaries' rights or
alter the rights or obligations of any third party under, or give to others any
rights of termination, amendment, acceleration or cancellation of any Material
Contract, or result in the creation of a lien or encumbrance on any of the
properties or assets of the Company or any of its subsidiaries pursuant to any
note, bond, mortgage, indenture, contract, agreement, lease, license, permit,
franchise or other instrument or obligation to which the Company or any of its
subsidiaries is a party or by which the Company or any of its subsidiaries or
its or any of their respective properties is bound or affected, except in any
such case for any such conflicts, violations, breaches, defaults or other
occurrences that would not have a Material Adverse Effect.
(c) Except as set forth in Section 3.5(c) of the Company Disclosure
Schedule, the execution and delivery of this Agreement by the Company does not,
and the performance of this Agreement by the Company will not, require any
consent, approval, authorization or permit of, or filing with or notification
to, any governmental or regulatory authority, domestic or foreign, except (i)
for applicable requirements, if any, of the Securities Act, the Exchange Act,
state securities laws ("Blue Sky Laws"), the pre-merger notification
requirements of the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended ("HSR Act"), and the filing and recordation of appropriate merger or
other documents as required by the Delaware Law, and (ii) where the failure to
obtain such consents, approvals, authorizations or permits, or to make such
filings or notifications, would not prevent or delay consummation of the Merger,
or otherwise prevent or delay the Company from performing its obligations under
this Agreement, or would not otherwise have a Material Adverse Effect.
SECTION 3.6 Compliance, Permits.
(a) Except as disclosed in Section 3.6(a) of the Company Disclosure
Schedule, neither the Company nor any of its subsidiaries is in conflict with,
or in default or violation of, (i) any law, rule, regulation, order, judgment or
decree applicable to the Company or any of its subsidiaries or by which its or
any of their respective properties is bound or affected or (ii) any note, bond,
mortgage, indenture, contract, agreement, lease, license, permit, franchise or
other instrument or obligation to which the Company or any of its subsidiaries
is a party or by which the Company or any of its subsidiaries or its or any of
their respective properties is bound or affected, except for any such conflicts,
defaults or violations which would not have a Material Adverse Effect.
(b) Except as disclosed in Section 3.6(b) of the Company Disclosure
Schedule, the Company and its subsidiaries hold all permits, licenses,
easements, variances, exemptions,
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consents, certificates, orders and approvals from governmental authorities that
are material to the operation of the business of the Company and its
subsidiaries taken as a whole as it is now being conducted (collectively, the
"Company Permits"), except when the failure to have such Company Permits would
not have a Material Adverse Effect. The Company and its subsidiaries are in
compliance with the terms of the Company Permits, except where the failure to so
comply would not have a Material Adverse Effect.
SECTION 3.7 SEC Filings; Financial Statements.
(a) The Company has filed all forms, reports and documents required to be
filed with the SEC and has made available to Parent (i) its Annual Reports on
Form 10-K for the fiscal years ended December 31, 1994 and 1995, respectively,
(ii) its Quarterly Reports on Form 10-Q for the periods ended March 31, 1996,
June 30, 1996 and September 30, 1996, (iii) all proxy statements relating to the
Company's meetings of stockholders (whether annual or special) held since
January 1, 1995, (iv) all other reports or registration statements (other than
Reports on Form 10-Q not referred to in clause (ii) above) filed by the Company
with the SEC since January 1, 1995, and (v) all amendments and supplements to
all such reports and registration statements filed by the Company with the SEC
since January 1, 1995 (collectively, the "Company SEC Reports"). Except as
disclosed in Section 3.7 of the Company Disclosure Schedule, the Company SEC
Reports (i) were prepared in all material respects in accordance with the
requirements of the Securities Act or the Exchange Act, as the case may be, and
(ii) did not at the time they were filed (or if amended or superseded by a
filing prior to the date of this Agreement, then on the date of such filing)
contain any untrue statement of a material fact or omit to state a material fact
required to be stated therein or necessary in order to make the statements
therein, in the light of the circumstances under which they were made, not
misleading. Except for STAT Healthcare, Inc., none of the Company's
subsidiaries is required to file any forms, reports or other documents with the
SEC.
(b) Each of the consolidated financial statements (including, in each
case, any related notes thereto) contained in the Company SEC Reports was
prepared in accordance with generally accepted accounting principles applied on
a consistent basis throughout the periods involved (except as may be indicated
in the notes thereto), and each fairly presents in all material respects the
consolidated financial position of the Company and its subsidiaries as at the
respective dates thereof and the consolidated results of its operations and cash
flows for the periods indicated, except that the unaudited interim financial
statements were or are subject to normal and recurring year-end adjustments
which were not or are not expected to be material in amount.
SECTION 3.8 Absence of Certain Changes or Events. Except as set forth in
Section 3.8 of the Company Disclosure Schedule or the Company SEC Reports, since
January 1, 1996, the Company has conducted its business in the ordinary course
and there has not occurred: (i) any Material Adverse Effect; (ii) any amendments
or changes in the Certificate of Incorporation or By-laws of the Company; (iii)
any damage to, destruction or loss of any asset
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of the Company (whether or not covered by insurance) that would have a Material
Adverse Effect; (iv) any material change by the Company in its accounting
methods, principles or practices; (v) any material revaluation by the Company of
any of its assets, including, without limitation, writing down the value of
inventory or writing off notes or accounts receivable other than in the ordinary
course of business; (vi) any other action or event that would have required the
consent of Parent pursuant to Section 5.1 had such action or event occurred
after the date of this Agreement; or (vii) any sale of a material amount of
property of the Company or any of its subsidiaries, except in the ordinary
course of business.
SECTION 3.9 No Undisclosed Liabilities. Except as is disclosed in
Section 3.9 of the Company Disclosure Schedule, neither the Company nor any of
its subsidiaries has any liabilities (absolute, accrued, contingent or
otherwise), except liabilities (a) in the aggregate adequately provided for in
the Company's unaudited balance sheet (including any related notes thereto) as
of September 30, 1996 (the "1996 Company Balance Sheet"), (b) incurred in the
ordinary course of business and not required under generally accepted accounting
principles to be reflected on the 1996 Company Balance Sheet, (c) incurred since
September 30, 1996 in the ordinary course of business consistent with past
practice, (d) incurred in connection with this Agreement, (e) disclosed in the
Company SEC Reports or (f) which would not have a Material Adverse Effect.
SECTION 3.10 Absence of Litigation. Except as set forth in Section 3.10
of the Company Disclosure Schedule, there are no claims, actions, suits,
proceedings or investigations pending or, to the knowledge of the Company,
overtly threatened against the Company or any of its subsidiaries, or any
properties or rights of the Company or any of its subsidiaries, before any
court, arbitrator or administrative, governmental or regulatory authority or
body, domestic or foreign, that would have a Material Adverse Effect.
SECTION 3.11 Employee Benefit Plans, Employment Agreements.
(a) Section 3.11 (a) of the Company Disclosure Schedule lists all employee
pension plans (as defined in Section 3(2) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA")), all material employee welfare plans
(as defined in Section 3(1) of ERISA) and all other material bonus, stock
option, stock purchase, incentive, deferred compensation, supplemental
retirement, severance and other similar fringe or employee benefit plans,
programs or arrangements, and any material current or former employment,
executive compensation, consulting or severance agreements, written or
otherwise, for the benefit of, or relating to, any employee of or consultant to
the Company, any trade or business (whether or not incorporated) which is a
member of a controlled group including the Company or which is under common
control with the Company (an "ERISA Affiliate") within the meaning of Section
414 of the Code, or any subsidiary of the Company, as well as each plan with
respect to which the Company or an ERISA Affiliate could incur liability under
Section 4069 (if such plan has been or were terminated) or Section 4212(c) of
ERISA (collectively the "Company Employee Plans"). There have been made
available to Parent copies of (i) each such written
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Company Employee Plan (other than those referred to in Section 4(b)(4) of
ERISA), (ii) the most recent annual report on Form 5500 series, with
accompanying schedules and attachments, filed with respect to each Company
Employee Plan required to make such a filing, and (iii) the most recent
actuarial valuation for each Company Employee Plan subject to Title IV of ERISA.
For purposes of this Section 3.11(a), the term "material," used with respect to
any Company Employee Plan, shall mean that the Company or an ERISA Affiliate has
incurred or may incur obligations in an annual amount exceeding $500,000 with
respect to such Company Employee Plan.
(b) (i) Except as set forth in Section 3.11(b) of the Company Disclosure
Schedule, none of the Company Employee Plans promises or provides retiree
medical or other retiree welfare benefits to any person, and none of the Company
Employee Plans is a "multiemployer plan" as such term is defined in Section
3(37) of ERISA; (ii) there has been no "prohibited transaction," as such term is
defined in Section 406 of ERISA and Section 4975 of the Code, with respect to
any Company Employee Plan, which could result in any material liability of the
Company or any of its subsidiaries; (iii) all Company Employee Plans are in
compliance in all material respects with the requirements prescribed by any and
all statutes (including ERISA and the Code), orders, or governmental rules and
regulations currently in effect with respect thereto (including all applicable
requirements for notification to participants or the Department of Labor, the
Pension Benefit Guaranty Corporation (the "PBGC"), Internal Revenue Service (the
"IRS") or Secretary of the Treasury), and the Company and each of its
subsidiaries have performed all material obligations required to be performed by
them under, are not in any material respect in default under or violation of,
and have no knowledge of any default or violation by any other party to, any of
the Company Employee Plans; (iv) each Company Employee Plan intended to qualify
under Section 401(a) of the Code and each trust intended to qualify under
Section 501(a) of the Code is the subject of a favorable determination letter
from the IRS, and nothing has occurred which may reasonably be expected to
impair such determination; (v) all contributions required to be made to any
Company Employee Plan pursuant to Section 412 of the Code, or the terms of the
Company Employee Plan or any collective bargaining agreement, have been made on
or before their due dates; (vi) with respect to each Company Employee Plan, no
"reportable event" within the meaning of Section 4043 of ERISA (excluding any
such event for which the 30 day notice requirement has been waived under the
regulations to Section 4043 of ERISA) nor any event described in Section 4062,
4063 or 4041 of ERISA has occurred; and (vii) neither the Company nor any ERISA
Affiliate has incurred, nor reasonably expects to incur, any liability under
Title IV of ERISA (other than liability for premium payments to the PBGC arising
in the ordinary course).
(c) Section 3.11(c) of the Company Disclosure Schedule sets forth a true
and complete list of each current or former employee, officer or director of the
Company or any of its subsidiaries who holds (i) any option to purchase Company
Common Stock as of the date hereof, together with the number of shares of
Company Common Stock subject to such option, the option price of such option (to
the extent determined as of the date hereof), whether such option is intended to
qualify as an incentive stock option within the meaning of Section 422(b)
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of the Code (an "ISO"), and the expiration date of such option; (ii) any other
right, directly or indirectly, to acquire Company Common Stock, together with
the number of shares of Company Common Stock subject to such right. Section
3.11(c) of the Company Disclosure Schedule also sets forth the total number of
such ISOs, such nonqualified options and such other rights.
(d) Section 3.11(d) of the Company Disclosure Schedule sets forth a true
and complete list of (i) all employment agreements with officers of the Company
or any of its subsidiaries; (ii) all agreements with consultants who are
individuals obligating the Company or any of its subsidiaries to make annual
cash payments in an amount exceeding $200,000; (iii) all employees of, or
consultants to, the Company or any of its subsidiaries who have executed a non-
competition agreement with the Company or any of its subsidiaries; (iv) all
severance agreements, programs and policies of the Company or any of its
subsidiaries with or relating to its employees, in each case with outstanding
commitments exceeding $300,000, excluding programs and policies required to be
maintained by law; and (v) all plans, programs, agreements and other
arrangements of the Company or any of its subsidiaries with or relating to its
employees which contain change in control provisions.
SECTION 3.12 Labor Matters. Except as set forth in Section 3.12 of the
Company Disclosure Schedule, (i) there are no controversies pending or, to the
knowledge of the Company or any of its subsidiaries, threatened, between the
Company or any of its subsidiaries and any of their respective employees, which
controversies have had or would have a Material Adverse Effect; (ii) neither the
Company nor any of its subsidiaries is a party to any material collective
bargaining agreement or other labor union contract applicable to persons
employed by the Company or its subsidiaries, nor does the Company or any of its
subsidiaries know of any activities or proceedings of any labor union to
organize any such employees; and (iii) neither the Company nor any of its
subsidiaries has any knowledge of any strikes, slowdowns, work stoppages,
lockouts, or threats thereof, by or with respect to any employees of the Company
or any of its subsidiaries which would have a Material Adverse Effect.
SECTION 3.13 Schedule 14D-9; Offer Documents; Proxy Statement. Neither
the Schedule 14D-9, nor any of the information provided by the Company and/or by
its auditors, legal counsel, financial advisors or other consultants or advisors
specifically for use in the Offer Documents shall, on the respective dates the
Schedule 14D-9, the Offer Documents or any supplements or amendments thereto are
filed with the SEC or on the date first published, sent or given to the
Company's stockholders, as the case may be, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. The proxy or
information statement or similar materials distributed to the Company's
stockholders in connection with the Merger, including any amendments or
supplements thereto (the "Proxy Statement"), shall not, at the time filed with
the SEC, at the time mailed to the Company's stockholders, at the time of the
Stockholders' Meeting or at the
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Effective Time, contain any untrue statement of a material fact or omit to state
any material fact required to be stated therein or necessary in order to make
the statements therein, in light of the circumstances under which they are made,
not misleading. Notwithstanding the foregoing, the Company makes no
representation or warranty with respect to any information provided by Parent,
Acquisition and/or by their auditors, legal counsel, financial advisors or other
consultants or advisors specifically for use in the Schedule 14D-9 or the Proxy
Statement. The Schedule 14D-9 and the Proxy Statement will comply as to form in
all material respects with the provisions of the Exchange Act and the rules and
regulations thereunder.
SECTION 3.14 Restrictions on Business Activities. Except for this
Agreement or as set forth in Section 3.14 of the Company Disclosure Schedule, to
the best of the Company's knowledge, there is no material agreement, judgment,
injunction, order or decree binding upon the Company or any of its subsidiaries
which has or could reasonably be expected to have the effect of prohibiting or
impairing any material business practice of the Company or any of its
subsidiaries, any acquisition of property by the Company or any of its
subsidiaries or the conduct of business by the Company or any of its
subsidiaries as currently conducted or as proposed to be conducted by the
Company, except for any prohibition or impairment as would not have a Material
Adverse Effect.
SECTION 3.15 Title to Property. Except as set forth in Section 3.15 of
the Company Disclosure Schedule, the Company and each of its subsidiaries have
good and defensible title to all of their properties and assets, free and clear
of all liens, charges and encumbrances, except liens for taxes not yet due and
payable and such liens or other imperfections of title, if any, as do not
materially detract from the value of or interfere with the present use of the
property affected thereby or which would not have a Material Adverse Effect;
and, to the best knowledge of the Company, all leases pursuant to which the
Company or any of its subsidiaries lease from others material amounts of real or
personal property are in good standing, valid and effective in accordance with
their respective terms, and there is not, to the knowledge of the Company, under
any of such leases, any existing material default or event of default (or event
which with notice or lapse of time, or both, would constitute a material
default), except where the lack of such good standing, validity and
effectiveness or the existence of such default or event of default would not
have a Material Adverse Effect.
SECTION 3.16 Taxes.
(a) For purposes of this Agreement, "Tax" or "Taxes" shall mean taxes,
fees, levies, duties, tariffs, imposts, and governmental impositions or charges
of any kind in the nature of (or similar to) taxes, payable to any federal,
state, local or foreign taxing authority, including (without limitation) (i)
income, franchise, profits, gross receipts, ad valorem, net worth, value added,
sales, use, service, real or personal property, special assessments, capital
stock, license, payroll, withholding, employment, social security, workers'
compensation, unemployment compensation, utility, severance, production, excise,
stamp, occupation,
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premiums, windfall profits, transfer and gains taxes, and (ii) interest,
penalties, additional taxes and additions to tax imposed with respect thereto;
and "Tax Returns" shall mean returns, reports, and information statements with
respect to Taxes required to be filed with the IRS or any other taxing
authority, domestic or foreign, including, without limitation, consolidated,
combined and unitary tax returns.
(b) Other than as disclosed in Section 3.16(b) of the Company Disclosure
Schedule, the Company and its subsidiaries (for such periods as each subsidiary
was owned, directly or indirectly, by the Company) have filed all United States
federal income Tax Returns and all other material Tax Returns required to be
filed by them, and the Company and its subsidiaries have paid and discharged all
Taxes due in connection with or with respect to the periods or transactions
covered by such Tax Returns and have paid all other Taxes as are due, except
such as are being contested in good faith by appropriate proceedings (to the
extent that any such proceedings are required) and except as may be determined
to be owed upon completion of any Tax Return not yet filed based upon an
extension of time to file, and there are no other Taxes that would be due if
asserted by a taxing authority, except with respect to which the Company is
maintaining reserves to the extent currently required except to the extent the
failure to do so would not have a Material Adverse Effect. Except as does not
involve or would not result in liability to the Company or any of its
subsidiaries that would have a Material Adverse Effect, (i) there are no tax
liens on any assets of the Company or any subsidiary thereof; and (ii) neither
the Company nor any of its subsidiaries has granted any waiver of any statute of
limitations with respect to, or any extension of a period for the assessment of,
any Tax. The accruals and reserves for Taxes (including deferred taxes)
reflected in the 1996 Company Balance Sheet are in all material respects
adequate to cover all Taxes required to be accrued through the date thereof
(including interest and penalties, if any, thereon and Taxes being contested) in
accordance with generally accepted accounting principles.
(c) Neither the Company nor any of its subsidiaries is, or has been, a
United States real property holding corporation (as defined in Section 897(c)(2)
of the Code) during the applicable period specified in Section 897(c)(1)(A)(ii)
of the Code. To the best knowledge of the Company, neither the Company nor any
of its subsidiaries owns any property of a character, the indirect transfer of
which, pursuant to this Agreement, would give rise to any material documentary,
stamp or other transfer tax.
SECTION 3.17 Environmental Matters. Except as set forth in Section 3.17
of the Company Disclosure Schedule, and except in all cases as, in the
aggregate, have not had and would not have a Material Adverse Effect, the
Company and each of its subsidiaries to the best of the Company's knowledge (i)
have obtained all applicable permits, licenses and other authorizations which
are required to be obtained under all applicable federal, state or local laws or
any regulation, code, plan, order, decree, judgment, notice or demand letter
issued, entered, promulgated or approved thereunder relating to pollution or
protection of the environment, including laws relating to emissions, discharges,
releases or threatened releases
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of pollutants, contaminants, or hazardous or toxic materials or wastes into
ambient air, surface water, ground water, or land or otherwise relating to the
manufacture, processing, distribution, use, treatment, storage, disposal,
transport, or handling of pollutants, contaminants or hazardous or toxic
materials or wastes ("Environmental Laws") by the Company or its subsidiaries
(or their respective agents); (ii) are in compliance with all terms and
conditions of such required permits, licenses and authorizations, and also are
in compliance with all other limitations, restrictions, conditions, standards,
prohibitions, requirements, obligations, schedules and timetables contained in
applicable Environmental Laws; (iii) as of the date hereof, are not aware of nor
have received notice of any past or present violations of Environmental Laws or
any event, condition, circumstance, activity, practice, incident, action or plan
which is reasonably likely to interfere with or prevent continued compliance
with or which would give rise to any common law or statutory liability, or
otherwise form the basis of any claim, action, suit or proceeding, against the
Company or any of its subsidiaries based on or resulting from the manufacture,
processing, distribution, use, treatment, storage, disposal, transport or
handling, or the emission, discharge or release into the environment, of any
pollutant, contaminant or hazardous or toxic material or waste; and (iv) have
taken all actions necessary under applicable Environmental Laws to register any
products or materials required to be registered by the Company or its
subsidiaries (or any of their respective agents) thereunder.
SECTION 3.18 Intellectual Property.
(a) Except as set forth in Section 3.18(a) of the Company Disclosure
Schedule, the Company and/or each of its subsidiaries owns, or is licensed or
otherwise possesses legally enforceable rights to use all patents, trademarks,
trade names, service marks, copyrights, and any applications therefor,
technology, know-how, computer software programs or applications, and tangible
or intangible proprietary information or material that are used in the business
of the Company and its subsidiaries as currently conducted, except as would not
have a Material Adverse Effect.
(b) Except as disclosed in Section 3.18(b) of the Company Disclosure
Schedule or as would not have a Material Adverse Effect, the Company is not, nor
will it be as a result of the execution and delivery of this Agreement or the
performance of its obligations hereunder, in violation of any licenses,
sublicenses and other agreements as to which the Company is a party and pursuant
to which the Company is authorized to use any third-party patents, trademarks,
service marks and copyrights ("Third-Party Intellectual Property Rights"). No
claims with respect to the patents, registered and material unregistered
trademarks and service marks, registered copyrights, trade names and any
applications therefor owned by the Company or any of its subsidiaries (the
"Company Intellectual Property Rights"), any trade secret material to the
Company, or Third Party Intellectual Property Rights to the extent arising out
of any use, reproduction or distribution of such Third Party Intellectual
Property Rights by or through the Company or any of its subsidiaries, are
currently pending or, to the knowledge of the Company, are overtly threatened by
any person. The Company does not know of any
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valid grounds for any bona fide claims (i) to the effect that the manufacture,
sale, licensing or use of any product as now used, sold or licensed or proposed
for use, sale or license by Company or any of its subsidiaries, infringes on any
copyright, patent, trademark, service mark or trade secret; (ii) against the use
by the Company or any of its subsidiaries of any trademarks, trade names, trade
secrets, copyrights, patents, technology, know-how or computer software programs
and applications used in the business of the Company or any of its subsidiaries
as currently conducted or as proposed to be conducted; (iii) challenging the
ownership, validity or effectiveness of any of the Company Intellectual Property
Rights or other trade secret material to the Company; or (iv) challenging the
license or legally enforceable right to use of the Third Party Intellectual
Rights by the Company or any of its subsidiaries.
(c) To the Company's knowledge, all patents, registered trademarks,
service marks and copyrights held by the Company are valid and subsisting.
Except as set forth in Section 3.18(c) of the Company Disclosure Schedule, to
the Company's knowledge, there is no material unauthorized use, infringement or
misappropriation of any of the Company Intellectual Property by any third party,
including any employee or former employee of the Company or any of its
subsidiaries.
SECTION 3.19 Interested Party Transactions. Except as set forth in
Section 3.19 of the Company Disclosure Schedule or in the Company SEC Reports,
since the date of the Company's proxy statement dated April 9, 1996, no event
has occurred that would be required to be reported as a Certain Relationship or
Related Transaction, pursuant to Item 404 of Regulation S-K promulgated by the
SEC.
SECTION 3.20 Insurance. All material fire and casualty, general
liability, business interruption, product liability, professional liability and
sprinkler and water damage insurance policies maintained by the Company or any
of its subsidiaries are with reputable insurance carriers, provide full and
adequate coverage for all normal risks incident to the business of the Company
and its subsidiaries and their respective properties and assets and are in
character and amount at least equivalent to that carried by entities engaged in
similar businesses and subject to the same or similar perils or hazards, except
as would not have a Material Adverse Effect.
SECTION 3.21 Healthcare Regulatory Compliance. To the best knowledge of
the Company, the Company and its subsidiaries have not engaged knowingly and
willfully in any activities which are prohibited under federal Medicare and
Medicaid statutes, including, without limitation, 42 U.S.C. (S) 1320a-7b or
related state or local statutes or regulations or which otherwise constitutes
fraud, including, without limitation, the following: (i) knowingly and
willfully making or causing to be made a false statement or representation of a
material fact in any application for any benefit or payment; (ii) knowingly and
willfully making or causing to be made any false statement or representation of
a material fact for use in determining rights to any benefit or payment; (iii)
failing to disclose knowledge of the
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occurrence of any event affecting the initial or continued right to any benefit
or payment on its behalf or on behalf of another, with intent to secure such
benefit or payment fraudulently; and (iv) knowingly and willfully soliciting or
receiving any remuneration (including any kickback, bribe, or rebate), directly
or indirectly, overtly or covertly, in cash or in kind or offering to pay such
remuneration (A) in return for referring an individual to a person for the
furnishing or arranging for the furnishing of any item or service for which
payment may be made in whole or in part by Medicare or Medicaid or (B) in return
for purchasing, leasing, or ordering or arranging for or recommending
purchasing, leasing or ordering any good, facility, service or item for which
payment may be made in whole or in part by Medicare or Medicaid.
SECTION 3.22 Opinion of Financial Advisor. The Board of Directors of the
Company has received the opinion of the Company's financial advisor, Smith
Barney, to the effect that, as of the date of this Agreement, the Per Share
Amount to be received by the holders of Shares (other than Parent and its
affiliates) pursuant to the Offer and the Merger, taken together, is fair, from
a financial point of view, to such holders.
SECTION 3.23 Brokers. No broker, finder or investment banker (other than
Smith Barney) is entitled to any brokerage, finder's or other fee or commission
in connection with the transactions contemplated by this Agreement based upon
arrangements made by or on behalf of the Company. The Company has heretofore
furnished to Parent a complete and correct copy of all agreements between the
Company and Smith Barney pursuant to which such firm would be entitled to any
payment relating to the transactions contemplated hereunder.
SECTION 3.24 Section 203 of the Delaware Law Not Applicable. The Board of
Directors of the Company has taken all actions so that the restrictions
contained in Section 203 of the Delaware applicable to a "business combination"
(as defined in Section 203) will not apply to the execution, delivery or
performance of this Agreement or the respective stockholders agreements dated as
of the date hereof between Parent or the consummation of the Offer or the Merger
or the other transactions contemplated by this Agreement.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF PARENT AND ACQUISITION
Parent and Acquisition hereby, jointly and severally, represent and warrant
to the Company that, except as set forth in the written disclosure schedule
delivered on or prior to the date hereof, by Parent to the Company that is
arranged in paragraphs corresponding to the numbered and lettered paragraphs
contained in this Article III (the "Parent Disclosure Schedule"):
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SECTION 4.1 Organization and Qualification; Subsidiaries. Each of Parent
and its subsidiaries is a corporation duly organized, validly existing and in
good standing under the laws of the jurisdiction of its incorporation and has
the requisite corporate power and authority and is in possession of all
Approvals necessary to own, lease and operate the properties it purports to own,
operate or lease and to carry on its business as it is now being conducted,
except where the failure to be so organized, existing and in good standing or to
have such power, authority and Approvals would not have a Material Adverse
Effect. Each of Parent and each of its subsidiaries is duly qualified or
licensed as a foreign corporation to do business, and is in good standing, in
each jurisdiction where the character of its properties owned, leased or
operated by it or the nature of its activities makes such qualification or
licensing necessary, except for such failures to be so duly qualified or
licensed and in good standing that would not have a Material Adverse Effect.
SECTION 4.2 Authority Relative to this Agreement. Each of Parent and
Acquisition has all necessary corporate power and authority to execute and
deliver this Agreement and to perform its obligations hereunder and to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement by Parent and Acquisition and the consummation by Parent and
Acquisition of the transactions contemplated hereby have been duly and validly
authorized by all necessary corporate action on the part of Parent and
Acquisition, and no other corporate proceedings on the part of Parent or
Acquisition are necessary to authorize this Agreement or to consummate the
transactions contemplated hereby. This Agreement has been duly and validly
executed and delivered by Parent and Acquisition and, assuming the due
authorization, execution and delivery by the Company, constitutes a legal, valid
and binding obligation of Parent and Acquisition enforceable against each of
them in accordance with its terms.
SECTION 4.3 No Conflict, Required Filings and Consents.
(a) Except as set forth in Section 4.3(a) of the Parent Disclosure
Schedule, the execution and delivery of this Agreement by Parent and Acquisition
do not, and the performance of this Agreement by Parent and Acquisition will
not, (i) conflict with or violate the Articles of Organization (or Certificate
of Incorporation) or By-Laws of Parent or Acquisition, (ii) conflict with or
violate any law, rule, regulation, order, judgment or decree applicable to
Parent or any of its subsidiaries or by which its or their respective properties
are bound or affected, or (iii) result in any breach of or constitute a default
(or an event which with notice or lapse of time or both would become a default)
under, or impair Parent's or any of its subsidiaries' rights or alter the rights
or obligations of any third party under, or give to others any rights of
termination, amendment, acceleration or cancellation of, or result in the
creation of a lien or encumbrance on any of the properties or assets of Parent
or any of its subsidiaries pursuant to, any note, bond, mortgage, indenture,
contract, agreement, lease, license, permit, franchise or other instrument or
obligation to which Parent or any of its subsidiaries is a party or by which
Parent or any of its subsidiaries or its or any of their respective properties
are bound or affected, except in any such case for any such conflicts,
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violations, breaches, defaults or other occurrences that would not have a
Material Adverse Effect.
(b) The execution and delivery of this Agreement by Parent and
Acquisition does not, and the performance of this Agreement by Parent and
Acquisition will not, require any consent, approval, authorization or permit of,
or filing with or notification to, any governmental or regulatory authority,
domestic or foreign, except (i) for applicable requirements, if any, of the
Securities Act, the Exchange Act, the Blue Sky Laws, the pre-merger notification
requirements of the HSR Act, and the filing and recordation of appropriate
merger or other documents as required by the Delaware Law, and (ii) where the
failure to obtain such consents, approvals, authorizations or permits, or to
make such filings or notifications, would not prevent or delay consummation of
the Offer or the Merger, or otherwise prevent Parent or Acquisition from
performing their respective obligations under this Agreement, and would not have
a Material Adverse Effect.
SECTION 4.4 Offer Documents; Schedule 14D-9; Proxy Statement. Neither
the Offer Documents, nor any of the information provided by Parent or
Acquisition and/or by their auditors, legal counsel, financial advisors or other
consultants or advisors specifically for use in the Schedule 14D-9 shall, on the
respective dates the Offer Documents, the Schedule 14D-9 or any supplements or
amendments thereto are filed with the SEC or on the date first published, sent
or given to the Company's stockholders, as the case may be, contain any untrue
statement of a material fact or omit to state any material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading. Notwithstanding
the foregoing, neither Parent nor Acquisition makes any representation or
warranty with respect to any information provided by the Company and/or by its
auditors, legal counsel, financial advisors or other consultants or advisors
specifically for use in the Offer Documents. None of the information provided
by Parent or Acquisition and/or by their auditors, attorneys, financial advisors
or other consultants or advisors specifically for use in the Proxy Statement
shall, at the time filed with the SEC, at the time mailed to the Company's
stockholders, at the time of the Stockholders' Meeting or at the Effective Time,
contain any untrue statement of a material fact or omit to state any material
fact required to be stated therein or necessary in order to make the statements
therein, in light of the circumstances under which they are made, not
misleading. The Offer Documents will comply as to form in all material respects
with the provisions of the Exchange Act and the rules and regulations
thereunder.
SECTION 4.5 No Prior Activities; Financing.
(a) Acquisition was formed solely for the purpose of engaging in the
transactions contemplated by this Agreement. As of the date hereof and the
Effective Time, except for obligations or liabilities incurred in connection
with its incorporation or organization and the transactions contemplated by this
Agreement and except for this Agreement and any other agreements or arrangements
contemplated by this Agreement, Acquisition has not and will not
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have incurred, directly or indirectly, through any subsidiary or affiliate, any
obligations or liabilities or engaged in any business activities of any type or
kind whatsoever or entered into any agreements or arrangements with any person.
(b) Acquisition has available to it funds necessary to satisfy its
obligations hereunder including, without limitation, the obligation to pay the
Per Share Amount pursuant to the Offer and the Merger Consideration pursuant to
the Merger and to pay all related fees and expenses in connection with the Offer
and the Merger.
ARTICLE V
CONDUCT OF BUSINESS PENDING THE MERGER
SECTION 5.1 Conduct of Business by the Company Pending the Merger. The
Company covenants and agrees that, during the period from the date of this
Agreement and continuing until the earlier of the termination of this Agreement
or the time Acquisition's designees are elected as directors of the Company
pursuant to Section 1.3, unless Parent shall otherwise agree in writing, which
agreement shall not be unreasonably withheld or delayed, the Company shall
conduct its business and shall cause the businesses of its subsidiaries to be
conducted only in, and the Company and its subsidiaries shall not take any
action except in, the ordinary course of business and in the manner consistent
with past practice; and the Company shall use reasonable commercial efforts to
preserve substantially intact the business organization of the Company and its
subsidiaries, to keep available the services of the present officers, employees
and consultants of the Company and its subsidiaries and to preserve the present
relationships of the Company and its subsidiaries with customers, suppliers and
other persons with which the Company or any of its subsidiaries has significant
business relations. By way of amplification and not limitation, except as
contemplated by this Agreement, neither the Company nor any of its subsidiaries
shall, during the period from the date of this Agreement and continuing until
the earlier of the termination of this Agreement or the time Acquisition's
designees are elected as directors of the Company pursuant to Section 1.3,
directly or indirectly do, or propose to do, any of the following without the
prior written consent of Parent, which consent shall not be unreasonably
withheld or delayed:
(a) amend or otherwise change the Certificate of Incorporation or By-Laws
of the Company or any of its subsidiaries;
(b) issue, sell, pledge, dispose of or encumber, or authorize the
issuance, sale, pledge, disposition or encumbrance of, any shares of capital
stock of any class, or any options, warrants, convertible securities or other
rights of any kind to acquire any shares of capital stock, or any other
ownership interest (including, without limitation, any phantom interest) in the
Company, any of its subsidiaries or affiliates (except for (i) the issuance of
shares of Company Common Stock issuable pursuant to Stock Options listed on
Schedule 3.11 hereto;
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(ii) the grant of options under the Company's Stock Option Plans consistent with
past practice to purchase up to 50,000 shares of Company Common Stock at the
market value on the date of grant to newly hired employees (excluding executive
officers), and the issuance of shares upon exercise thereof, (iii) the issuance
of shares of Company Common Stock issuable upon conversion of the Notes, (iv)
the issuance of shares of Company Common Stock issuable to participants in the
Company's Employee Stock Purchase Plan pursuant to the terms thereof, (v) the
issuance of shares of Company Common Stock at not less than the fair market
value thereof in connection with Permitted Acquisitions (as defined in Section
5.1(e)) and (vi) the issuance of shares of Company Common Stock to former
holders of shares of capital stock of STAT Healthcare, Inc.
(c) sell, pledge, dispose of or encumber any assets of the Company or any
of its subsidiaries (except for (i) sales of assets in the ordinary course of
business and in a manner consistent with past practice, (ii) disposition of
obsolete or worthless assets, (iii) sales of immaterial assets not in excess of
$500,000 and (iv) encumbrances on assets to secure purchase money financings of
equipment and capital improvements and in connection with the financing of
Permitted Acquisitions (as defined in Section 5.1(e))).
(d) (i) declare, set aside, make or pay any dividend or other
distribution (whether in cash, stock or property or any combination thereof) in
respect of any of its capital stock, except that a wholly owned subsidiary of
the Company may declare and pay a dividend or make advances to its parent or the
Company, (ii) split, combine or reclassify any of its capital stock or issue or
authorize or propose the issuance of any other securities in respect of, in lieu
of or in substitution for shares of its capital stock, or (iii) amend the terms
or change the period of exercisability of, purchase, repurchase, redeem or
otherwise acquire, or permit any subsidiary to purchase, repurchase, redeem or
otherwise acquire, any of its securities or any securities of its subsidiaries,
including, without limitation, shares of Company Common Stock or any option,
warrant or right, directly or indirectly, to acquire shares of Company Common
Stock, or propose to do any of the foregoing; except for the acceleration of
options pursuant to the terms of the Company Common Stock Option Plans and the
net exercise of such options and the repurchase of Notes as required by the
terms thereof;
(e) (i) acquire (by merger, consolidation, or acquisition of stock or
assets) any corporation, partnership or other business organization or division
thereof other than (A) those listed on Section 5.1(e) of the Company Disclosure
Schedule and (B) ambulance service providers and other health care providers in
the continental United States and Hawaii, whether acquired solely for cash,
promissory notes that are subordinated as required by the Company's lenders, or
Company Common Stock issued at fair market value, or any combination thereof
(together with the acquisitions described in clause (A), "Permitted
Acquisitions"), provided that the total consideration paid for all such
acquisitions described in this clause (B) consummated prior to March 31, 1997
shall not exceed $50 million and the total consideration paid for all such
acquisitions described in this clause (B) consummated prior to July 15, 1997
shall not exceed $100 million; (ii) incur any indebtedness for borrowed money or
issue any
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debt securities or assume, guarantee or endorse or otherwise as an accommodation
become responsible for, the obligations of any person or, except in the ordinary
course of business consistent with past practice or in connection with purchases
of equipment or capital improvements or in Permitted Acquisitions, make any
loans or advances (other than loans or advances to or from direct or indirect
wholly owned subsidiaries), (iii) enter into or amend any material contract or
agreement other than in the ordinary course of business or where such contract
or amendment would not have a Material Adverse Effect; (iv) authorize any
capital expenditures or purchase of fixed assets which are, in the aggregate, in
excess of the amounts set forth in Section 5.1(e)(iv) of the Company Disclosure
Schedule for the Company and its subsidiaries taken as a whole; or (v) enter
into or amend any contract, agreement, commitment or arrangement to effect any
of the matters prohibited by this Section 5.1(e);
(f) except as set forth in Section 5.1(f) of the Company Disclosure
Schedule, increase the compensation payable or to become payable to its officers
or employees, except for increases in salary or wages of employees of the
Company or its subsidiaries in accordance with past practice and in amounts that
are in the aggregate reflected in the budgets previously provided to Parent or,
except in the ordinary course of business, grant any severance or termination
pay to, or enter into any employment or severance agreement with any director,
officer or other employee of the Company or any of its subsidiaries, or
establish, adopt, enter into or amend any collective bargaining, bonus, profit
sharing, thrift, compensation, stock option, restricted stock, pension,
retirement, deferred compensation, employment, termination, severance or other
plan, agreement, trust, fund, policy or arrangement for the benefit of any
current or former directors, officers or employees, except, in each case, as may
be required by law;
(g) take any action to change accounting policies or procedures
(including, without limitation, procedures with respect to revenue recognition,
payments of accounts payable and collection of accounts receivable);
(h) make any material tax election inconsistent with past practice or
settle or compromise any material federal, state, local or foreign tax liability
or agree to an extension of a statute of limitations, except to the extent the
amount of any such settlement has been reserved for in the financial statements
contained in the Company SEC Reports filed prior to the date of this Agreement;
(i) pay, discharge or satisfy any claims, liabilities or obligations
(absolute, accrued, asserted or unasserted, contingent or otherwise), other than
the payment, discharge or satisfaction in the ordinary course of business and
consistent with past practice of liabilities reflected or reserved against in
the financial statements contained in the Company SEC Reports filed prior to the
date of this Agreement or incurred in the ordinary course of business and
consistent with past practice; or
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(j) take, or agree in writing or otherwise to take, any of the actions
described in Sections 5.1(a) through (i) above, or any action which would make
any of the representations or warranties of the Company contained in this
Agreement untrue or incorrect or prevent the Company from performing or cause
the Company not to perform its covenants hereunder.
SECTION 5.2 No Solicitation.
(a) The Company shall not, directly or indirectly, through any officer,
director, employee, representative or agent of the Company or any of its
subsidiaries, (i) solicit, initiate or encourage the initiation of any inquiries
or proposals regarding any merger, sale of substantial assets, sale of shares of
capital stock (including without limitation by way of a tender offer, but not in
connection with Permitted Acquisitions) or similar transactions involving the
Company or any subsidiaries of the Company other than the Merger (any of the
foregoing inquiries or proposals being referred to herein as an "Acquisition
Proposal"), (ii) engage in negotiations or discussions concerning, or provide
any nonpublic information to any person relating to, any Acquisition Proposal or
(iii) agree to approve or recommend any Acquisition Proposal. Nothing contained
in this Section 5.2(a) shall prevent the Board of Directors of the Company from
considering, negotiating, approving and recommending to the stockholders of the
Company, or taking the actions permitted by Section 5.2(c) with respect to, a
bona fide Acquisition Proposal not solicited in violation of this Agreement,
provided the Board of Directors of the Company determines in good faith (upon
written advice of independent counsel) that it is required to do so in order to
discharge properly its fiduciary duties.
(b) The Company shall immediately notify Parent after receipt of any
Acquisition Proposal, or any modification of or amendment to any Acquisition
Proposal, or any request for nonpublic information relating to the Company or
any of its subsidiaries in connection with an Acquisition Proposal or for access
to the properties, books or records of the Company or any subsidiary by any
person or entity that informs the Board of Directors of the Company or such
subsidiary that it is considering making, or has made, an Acquisition Proposal.
Such notice to Parent shall be made orally and in writing, and shall indicate
whether the Company is providing or intends to provide the person making the
Acquisition Proposal with access to information concerning the Company as
provided in Section 5.2(c).
(c) If the Board of Directors of the Company receives a request for
material nonpublic information by a person who makes a bona fide Acquisition
Proposal, and the Board of Directors determines in good faith and upon the
written advice of independent counsel that it is required to cause the Company
to act as provided in this Section 5.2(c) in order to discharge properly the
directors' fiduciary duties, then, provided the person making the Acquisition
Proposal has executed a confidentiality agreement similar to the one then in
effect between the Company and Parent, the Company may provide such person with
access to information regarding the Company.
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(d) The Company shall immediately cease and cause to be terminated any
existing discussions or negotiations with any person (other than Parent and
Acquisition) conducted heretofore with respect to any of the foregoing. The
Company agrees not to release any third party from the confidentiality
provisions of any confidentiality agreement to which the Company is a party.
(e) The Company shall ensure that the officers, directors and employees
of the Company and its subsidiaries and any investment banker or other advisor
or representative retained by the Company are aware of the restrictions
described in this Section 5.2.
ARTICLE VI
ADDITIONAL AGREEMENTS
SECTION 6.1 HSR Act. As promptly as practicable after the date of this
Agreement, the Company and Parent shall file notifications under the HSR Act in
connection with the Merger and the transactions contemplated hereby and to
respond as promptly as practicable to any inquiries received from the Federal
Trade Commission (the "FTC") and the Antitrust Division of the Department of
Justice (the "Antitrust Division") for additional information or documentation
and to respond as promptly as practicable to all inquiries and requests received
from any State Attorney General or other governmental authority in connection
with antitrust matters.
SECTION 6.2 Access to Information; Confidentiality. Upon reasonable
notice and subject to restrictions contained in confidentiality agreements to
which such party is subject (from which such party shall use reasonable efforts
to be released), the Company shall (and shall cause each of its subsidiaries to)
afford to the officers, employees, accountants, counsel and other
representatives of Parent of Acquisition reasonable access, during the period to
the Effective Time, to all its properties, books, contracts, commitments and
records and, during such period, the Company shall (and shall cause each of its
subsidiaries to) furnish promptly to Parent or Acquisition all information
concerning its business, properties and personnel as such other party may
reasonably request, and each shall make available to the other the appropriate
individuals (including attorneys, accountants and other professionals) for
discussion of the other's business, properties and personnel as either Parent or
the Company may reasonably request. Parent and Acquisition shall keep such
information confidential in accordance with the terms of the confidentiality
letters dated December 23, 1996 (the "Confidentiality Letter"), between Parent
and the Company.
SECTION 6.3 Consents; Approvals. The Company and Parent shall each use
their best efforts to obtain all consents, waivers, approvals, authorizations or
orders (including, without limitation, all United States and foreign
governmental and regulatory rulings and approvals), and the Company and Parent
shall make all filings (including, without limitation,
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all filings with United States and foreign governmental or regulatory agencies)
required in connection with the authorization, execution and delivery of this
Agreement by the Company and Parent and the consummation by them of the
transactions contemplated hereby. The Company and Parent shall furnish all
information required to be included in the Joint Proxy Statement/Prospectus and
the Registration Statement, or for any application or other filing to be made
pursuant to the rules and regulations of any United States or foreign
governmental body in connection with the transactions contemplated by this
Agreement.
SECTION 6.4 Indemnification and Insurance.
(a) The Certificate of Incorporation and By-Laws of the Surviving
Corporation shall contain the provisions with respect to indemnification and
exculpation set forth in the Certificate of Incorporation and By-Laws of the
Company, which provisions shall not be amended, repealed or otherwise modified
for a period of three years from the Effective Time in any manner that would
adversely affect the rights thereunder of individuals who at the Effective Time
were directors, officers, employees or agents of the Company, unless such
modification is required by law.
(b) The Company shall, to the fullest extent permitted under applicable
law or under the Company's Certificate of Incorporation or By-Laws and
regardless of whether the Merger becomes effective, indemnify and hold harmless,
and, after the Effective Time, the Surviving Corporation shall, to the fullest
extent permitted under applicable law or under the Surviving Corporation's
Certificate of Incorporation or By-Laws, indemnify and hold harmless, each
present and former director, officer or employee of the Company or any of its
subsidiaries (collectively, the "Indemnified Parties") against any costs or
expenses (including attorneys' fees), judgments, fines, losses, claims, damages
and liabilities incurred in connection with, and amounts paid in settlement of,
any claim, action, suit, proceeding or investigation, whether civil, criminal,
administrative or investigative and wherever asserted, bought or filed, (x)
arising out of or pertaining to the transactions contemplated by this Agreement
or (y) otherwise with respect to any acts or omissions or alleged acts or
omissions occurring at or prior to the Effective Time, to the same extent as
provided in the respective Certificate of Incorporation or By-Laws of the
Company or the subsidiaries or any applicable contract or agreement as in effect
on the date hereof, in each case for a period of three years after the date
hereof. In the event of any such claim, action, suit, proceeding or
investigation (whether arising before or after the Effective Time), (i) any
counsel retained by the Indemnified Parties for any period after the Effective
Time shall be reasonably satisfactory to the Surviving Corporation, (ii) after
the Effective Time, the Surviving Corporation shall pay the reasonable fees and
expenses of such counsel, promptly after statements therefor are received, and
(iii) the Surviving Corporation will cooperate in the defense of any such
matter; provided, however, that the Surviving Corporation shall not be liable
for any settlement effected without its written consent (which consent shall not
be unreasonably withheld or delayed); and provided, further, that, in the event
that any claim or claims for indemnification are asserted or made within such
three-year period, all rights to indemnification in respect of any such claim
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or claims shall continue until the disposition of any and all such claims. The
Indemnified Parties as a group may retain only one law firm to represent them
with respect to any single action unless there is, under applicable standards of
professional conduct, a conflict on any significant issue between the positions
of any two or more Indemnified Parties. The indemnity agreements of Parent and
the Surviving Corporation in this Section 5.7(b) shall extend, on the same terms
to, and shall inure to the benefit of and shall be enforceable by, each person
or entity who controls, or in the past controlled, any present or former
director, officer or employee of the Company or any of its subsidiaries.
(c) The Surviving Corporation shall honor and fulfill in all respects the
obligations of the Company pursuant to indemnification agreements with the
Company's directors and officers existing at or before the Effective Time.
(d) For a period of five years after the Effective Time, Parent shall
cause the Surviving Corporation to maintain in effect, if available, directors'
and officers' liability insurance covering those persons who are currently
covered by the Company's directors' and officers' liability insurance policy (a
copy of which has been made available to Parent) on terms (including the amounts
of coverage and the amounts of deductibles, if any) that are comparable to the
terms now applicable to directors and officers of Parent, or, if more favorable
to the Company's directors and officers, the terms now applicable to them under
the Company's current policies; provided, however, that in no event shall Parent
or the Surviving Corporation be required to expend in excess of 300% of the
annual premium currently paid by the Company for such coverage; and provided
further, that if the premium for such coverage exceeds such amount, Parent or
the Surviving Corporation shall purchase a policy with the greatest coverage
available for such 300% of the annual premium.
(e) From and after the Effective Time, Parent shall guarantee the
obligations of the Surviving Corporation under this Section 6.4.
(f) This Section shall survive the consummation of the Merger at the
Effective Time, is intended to benefit the Company, the Surviving Corporation
and the Indemnified Parties, shall be binding on all successors and assigns of
the Surviving Corporation and shall be enforceable by the Indemnified Parties.
In the event that Parent or Surviving Corporation or any of their successors or
assigns (i) consolidates or merges into any other person or entity and shall not
be the continuing or surviving corporation or entity in such consolidation or
merger or (ii) transfers all or substantially all of its properties and assets
to any person or entity, then and in such case, proper provisions shall be made
so that the successors and assigns of Parent or the Surviving Corporation (as
the case may be) assume the obligations of Parent and the Surviving Corporation
set forth in this Section.
SECTION 6.5 Notification of Certain Matters. The Company shall give
prompt notice to Parent, and Parent shall give prompt notice to the Company, of
(i) the occurrence or nonoccurrence of any event the occurrence or nonoccurrence
of which would be likely to
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cause any representation or warranty contained in this Agreement to be
materially untrue or inaccurate, or (ii) any failure of the Company, Parent or
Acquisition, as the case may be, materially to comply with or satisfy any
covenant, condition or agreement to be complied with or satisfied by it
hereunder; provided, however, that the delivery of any notice pursuant to this
Section shall not limit or otherwise affect the remedies available hereunder to
the party receiving such notice.
SECTION 6.6 Further Action. Upon the terms and subject to the conditions
hereof, each of the parties hereto shall use all reasonable efforts to take, or
cause to be taken, all actions, and to do, or cause to be done, all other things
necessary, proper or advisable to consummate and make effective as promptly as
practicable the transactions contemplated by this Agreement, to obtain in a
timely manner all necessary waivers, consents and approvals and to effect all
necessary registrations and filings, and otherwise to satisfy or cause to be
satisfied all conditions precedent to its obligations under this Agreement. The
foregoing covenant shall not include any obligations by Parent to agree to
divest, abandon, license or take similar action with respect to any assets of
Parent or the Company except such actions that would not have a Material Adverse
Effect on Parent and its subsidiaries taken as a whole.
SECTION 6.7 Public Announcements. Parent and the Company shall consult
with each other before issuing any press release with respect to the Merger or
this Agreement and shall not issue any such press release or make any such
public statement without the prior consent of the other party, which shall not
be unreasonably withheld; provided, however, that a party may, without the prior
consent of the other party, issue such press release or make such public
statement as may upon the advice of counsel be required by law or the rules and
regulations of the New York Stock Exchange, Inc. ("NYSE"), if it has used all
reasonable efforts to consult with the other party.
SECTION 6.8 Conveyance Taxes. Parent and the Company shall cooperate in
the preparation, execution and filing of all returns, questionnaires,
applications, or other documents regarding any real property transfer or gains,
sales, use, transfer, value added, stock transfer and stamp taxes, any transfer,
recording, registration and other fees, and any similar taxes which become
payable in connection with the transactions contemplated hereby that are
required or permitted to be filed on or before the Effective Time.
ARTICLE VII
CONDITIONS TO THE MERGER
SECTION 7.1 Conditions to Obligation of Each Party to Effect the Merger.
The respective obligations of each party to effect the Merger shall be subject
to the satisfaction at or prior to the Effective Time of the following
conditions:
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(a) Purchase of Shares. Acquisition shall have purchased Shares pursuant
to the Offer;
(b) HSR Act. The waiting period applicable to the consummation of the
Merger under the HSR Act shall have expired or been terminated.
(c) No Injunctions or Restraints; Illegality. No temporary restraining
order, preliminary or permanent injunction or other order issued by any court of
competent jurisdiction or other legal restraint or prohibition preventing the
consummation of the Merger shall be in effect, nor shall any proceeding brought
by any administrative agency or commission or other governmental authority or
instrumentality, domestic or foreign, seeking any of the foregoing be pending;
and there shall not be any action taken, or any statute, rule, regulation or
order enacted, entered, enforced or deemed applicable to the Merger which makes
the consummation of the Merger illegal;
(d) Governmental Actions. There shall not have been instituted, pending
or threatened any action or proceeding (or any investigation or other inquiry
that might result in such an action or proceeding) by any governmental authority
or administrative agency before any governmental authority, administrative
agency or court of competent jurisdiction, nor shall there be in effect any
judgment, decree or order of any governmental authority, administrative agency
or court of competent jurisdiction, in either case, seeking to prohibit or limit
Parent from exercising all material rights and privileges pertaining to its
ownership of the Surviving Corporation or the ownership or operation by Parent
or any of its subsidiaries of all or a material portion of the business or
assets of Parent or any of its subsidiaries, or seeking to compel Parent or any
of its subsidiaries to dispose of or hold separate all or any material portion
of the business or assets of Parent or any of its subsidiaries (including the
Surviving Corporation and its subsidiaries), as a result of the Merger or the
transactions contemplated by this Agreement.
ARTICLE VIII
TERMINATION
SECTION 8.1 Termination. This Agreement may be terminated at any time
prior to the Effective Time, notwithstanding approval thereof by the
stockholders of the Company or Parent:
(a) by mutual written consent duly authorized by the Boards of Directors
of Parent, Acquisition and the Company; or
(b) by either Parent or the Company if a court of competent jurisdiction
or governmental, regulatory or administrative agency or commission shall have
issued a
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nonappealable final order, decree or ruling or taken any other action having the
effect of permanently restraining, enjoining or otherwise prohibiting the Merger
(provided that the right to terminate this Agreement under this Section 8.1(b)
shall not be available to any party who has not complied with its obligations
under Section 6.6 and such noncompliance materially contributed to the issuance
of any such order, decree or ruling or the taking of such action); or
(c) by either Parent or the Company if Acquisition shall have (A)
terminated the Offer or (B) failed to accept for purchase and pay for Shares
pursuant to the Offer by April 15, 1997 unless Acquisition's actions are a
result of the receipt by the Company of an Acquisition Proposal or a request for
additional information under the HSR Act or the failure to obtain any necessary
governmental or regulatory approval, in which case if Acquisition shall have
failed to accept for purchase and pay for Shares by July 15, 1997 (provided that
the right to terminate this Agreement under this Section 8.1(c) shall not be
available to any party whose failure to fulfill any obligation under this
Agreement has been the cause of or resulted in any of the circumstances
described in clauses (A) and (B) before such date); or
(d) by Parent or the Company, prior to the purchase of Shares pursuant to
the Offer, if the Board of Directors of the Company shall withdraw, modify or
change its approval or recommendation of the Offer, this Agreement or the Merger
in a manner adverse to Parent; or
(e) by Parent or the Company, prior to the purchase of Shares pursuant to
the Offer, (i) if any representation or warranty of the Company or Parent,
respectively, set forth in this Agreement shall be untrue when made, or (ii)
upon a breach in any material respect of any covenant or agreement on the part
of the Company or Parent, respectively, set forth in this Agreement, in each
case where such untruth or breach would have a Material Adverse Effect on the
Company or the Parent, as the case may be (either (i) or (ii) above being a
"Terminating Breach"), provided, that, if such Terminating Breach is curable by
the Company or Parent, as the case may be, through the exercise of its
reasonable best efforts and for so long as the Company or Parent, as the case
may be, continues to exercise such reasonable best efforts, neither Parent nor
the Company, respectively, may terminate this Agreement under this Section
7.1(e).
SECTION 8.2 Effect of Termination. In the event of the termination of
this Agreement pursuant to Section 8.1, this Agreement shall forthwith become
void and there shall be no liability on the part of any party hereto or any of
its affiliates, directors, officers or stockholders except (i) as set forth in
Section 8.3 and Section 9.1 hereof, and (ii) except as otherwise provided in
Section 8.3, nothing herein shall relieve any party from liability for any
Termination Breach hereof by such party.
SECTION 8.3 Fees and Expenses.
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(a) Except as set forth in this Section 8.3, all fees and expenses
incurred in connection with this Agreement and the transactions contemplated
hereby shall be paid by the party incurring such expenses, whether or not the
Merger is consummated.
(b) The Company shall pay Parent a fee of $17.5 million (the "Company
Fee"), upon the first to occur of the following events:
(i) the termination of this Agreement by Parent pursuant to Section
8.1(d); or
(ii) the termination of this Agreement by Parent pursuant to Section
8.1(e) on account of a Terminating Breach by the Company.
(c) The Company Fee payable pursuant to Section 8.3(b) shall be paid
within two (2) business days after the first to occur of any of the events
described in Section 8.3(b)(i) or (ii); provided, that, in no event shall the
Company be required to pay such Fee to Parent if, immediately prior to the
termination of this Agreement, Parent was in breach of any of its material
obligations under this Agreement. The payment of Company Fee shall be Parent's
sole and exclusive remedy for the event giving rise to the payment of the
Company Fee.
ARTICLE IX
GENERAL PROVISIONS
SECTION 9.1 Effectiveness of Representations, Warranties and Agreements;
Knowledge, Etc.
(a) Except as otherwise provided in this Section 9.1, the representations,
warranties and agreements of each party hereto shall remain operative and in
full force and effect regardless of any investigation made by or on behalf of
any other party hereto, any person controlling any such party or any of their
officers or directors, whether prior to or after the execution of this
Agreement. The representations, warranties and agreements in this Agreement
shall terminate at the Effective Time or upon the termination of this Agreement
pursuant to Section 8.1, as the case may be, except that (i) if the Merger is
consummated the agreements set forth in Article II shall survive the Effective
Time indefinitely, (ii) the agreements in Section 6.4 shall survive in
accordance with their respective terms and (iii) the agreements set forth in
Section 8.3 shall survive termination indefinitely. The Confidentiality Letter
shall survive termination of this Agreement as provided therein.
(b) Any disclosure made with reference to one or more sections of the
Company Disclosure Schedule or the Parent Disclosure Schedule shall be deemed
disclosed only with respect to such section.
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SECTION 9.2 Notices. All notices and other communications given or made
pursuant hereto shall be in writing and shall be deemed to have been duly given
or made if and when delivered personally or by overnight courier to the parties
at the following addresses or sent by electronic transmission, with confirmation
received, to the telecopy numbers specified below (or at such other address or
telecopy number for a party as shall be specified by like notice):
(a) If to Parent or Acquisition:
Laidlaw Inc.
3221 North Service Road
Burlington, Ontario L7R 3Y8
Telecopier No.: (905) 332-6550
Telephone No.: (905) 336-1800
Attention: Ivan R. Cairns, Senior Vice President and General Counsel
(b) If to the Company:
American Medical Response, Inc.
2821 South Parker Road, Suite 1000
Aurora, CO 80014
Telecopier No.: (303) 614-8519
Telephone No.: (303) 614-8500
Attention: President
With a copy to:
Keith F. Higgins, Esq.
Ropes & Gray
One International Place
Boston, MA 02110
Telecopier No.: (617) 951-7050
Telephone No.: (617) 951-7000
SECTION 9.3 Certain Definitions. For purposes of this Agreement, the
term:
(a) "affiliates" means a person that directly or indirectly, through one
or more intermediaries, controls, is controlled by, or is under common control
with, the first mentioned person; including, without limitation, any partnership
or joint venture in which the
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Company (either alone, or through or together with any other subsidiary) has,
directly or indirectly, an interest of 10% or more;
(b) "beneficial owner" with respect to any shares of Company Common Stock
means a person who shall be deemed to be the beneficial owner of such shares (i)
which such person or any of its affiliates or associates (as such term is
defined in Rule 12b-2 of the Exchange Act) beneficially owns, directly or
indirectly, (ii) which such person or any of its affiliates or associates has,
directly or indirectly, (A) the right to acquire (whether such right is
exercisable immediately or subject only to the passage of time), pursuant to any
agreement, arrangement or understanding or upon the exercise of consideration
rights, exchange rights, warrants or options, or otherwise, or (B) the right to
vote pursuant to any agreement, arrangement or understanding, or (iii) which are
beneficially owned, directly or indirectly, by any other persons with whom such
person or any of its affiliates or associates has any agreement, arrangement or
understanding for the purpose of acquiring, holding, voting or disposing of any
shares;
(c) "business day" means any day other than a day on which banks in New
York are required or authorized to be closed;
(d) "control" (including the terms "controlled by" and "under common
control with") means the possession, directly or indirectly or as trustee or
executor, of the power to direct or cause the direction of the management or
policies of a person, whether through the ownership of stock, as trustee or
executor, by contract or credit arrangement or otherwise;
(e) "person" means an individual, corporation, partnership, association,
trust, unincorporated organization, other entity or group (as defined in Section
13(d)(3) of the Exchange Act); and
(f) "subsidiary" or "subsidiaries" of the Company, the Surviving
Corporation, Parent or any other person means any corporation, partnership,
joint venture or other legal entity of which the Company, the Surviving
Corporation, Parent or such other person, as the case may be (either alone or
through or together with any other subsidiary), owns, directly or indirectly,
more than 50% of the stock or other equity interests the holders of which are
generally entitled to vote for the election of the board of directors or other
governing body of such corporation or other legal entity.
SECTION 9.4 Amendment. This Agreement may be amended by the parties
hereto by action taken by or on behalf of their respective Boards of Directors
at any time prior to the Effective Time; provided, however, that, after approval
of the Merger by the stockholders of the Company, no amendment may be made which
by law requires further approval by such stockholders without such further
approval. This Agreement may not be amended except by an instrument in writing
signed by the parties hereto.
38
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SECTION 9.5 Waiver. At any time prior to the Effective Time, any party
hereto may with respect to any other party hereto (a) extend the time for the
performance of any of the obligations or other acts, (b) waive any inaccuracies
in the representations and warranties contained herein or in any document
delivered pursuant hereto, or (c) waive compliance with any of the agreements or
conditions contained herein. Any such extension or waiver shall be valid if set
forth in an instrument in writing signed by the party or parties to be bound
thereby.
SECTION 9.6 Headings. The headings contained in this Agreement are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Agreement.
SECTION 9.7 Severability. If any term or other provision of this
Agreement is invalid, illegal or incapable of being enforced by any rule of law,
or public policy, all other conditions and provisions of this Agreement shall
nevertheless remain in full force and effect so long as the economic or legal
substance of the transactions contemplated hereby is not affected in any manner
adverse to any party. Upon such determination that any term or other provision
is invalid, illegal or incapable of being enforced, the parties hereto shall
negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the end
that transactions contemplated hereby are fulfilled to the extent possible.
SECTION 9.8 Entire Agreement. This Agreement constitutes the entire
agreement and supersedes all prior agreements and undertakings (other than the
Confidentiality Letters), both written and oral, among the parties, or any of
them, with respect to the subject matter hereof and, except as otherwise
expressly provided herein.
SECTION 9.9 Assignment; Guarantee of Acquisition Obligations. This
Agreement shall not be assigned by operation of law or otherwise, except that
Parent and Acquisition may assign all or any of their rights hereunder to any
affiliate provided that no such assignment shall relieve the assigning party of
its obligations hereunder. Parent guarantees the full and punctual performance
by Acquisition of all the obligations hereunder of Acquisition or any such
assignees.
SECTION 9.10 Parties in Interest. This Agreement shall be binding upon
and inure solely to the benefit of each party hereto, and nothing in this
Agreement, express or implied, is intended to or shall confer upon any other
person any right, benefit or remedy of any nature whatsoever under or by reason
of this Agreement, including, without limitation, by way of subrogation, other
than Section 6.4 (which is intended to be for the benefit of the Indemnified
Parties and may be enforced by such Indemnified Parties).
SECTION 9.11 Failure or Indulgence Not Waiver; Remedies Cumulative. No
failure or delay on the part of any party hereto in the exercise of any right
hereunder shall impair such right or be construed to be a waiver of, or
acquiescence in, any breach of any representation, warranty or agreement herein,
nor shall any single or partial exercise of any
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<PAGE>
such right preclude other or further exercise thereof or of any other right.
All rights and remedies existing under this Agreement are cumulative to, and not
exclusive of, any rights or remedies otherwise available.
SECTION 9.12 Governing Law. This Agreement shall be governed by, and
construed in accordance with, the internal laws of the State of Delaware
applicable to contracts executed and fully performed within the State of
Delaware.
SECTION 9.13 Counterparts. This Agreement may be executed in one or more
counterparts, and by the different parties hereto in separate counterparts, each
of which when executed shall be deemed to be an original but all of which taken
together shall constitute one and the same agreement.
[This space intentionally left blank.]
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<PAGE>
IN WITNESS WHEREOF, Parent, Acquisition and the Company have caused this
Agreement to be executed as of the date first written above by their respective
officers thereunto duly authorized.
LAIDLAW INC.
By:/s/James R. Bullock
------------------------
Name: James R. Bullock
Title: President and Chief Executive Officer
MEDTRANS ACQUISITION CO.
By:/s/Ivan R. Cairns
-----------------------
Name: Ivan R. Cairns
Title: President
AMERICAN MEDICAL RESPONSE, INC.
By:/s/Paul T. Shirley
-----------------------
Name: Paul T. Shirley
Title: President and Chief Executive Officer
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<PAGE>
ANNEX A
OFFER CONDITIONS
The capitalized terms used in this Annex A have the meanings set forth
in the attached Agreement, except that the term "Merger Agreement" shall be
deemed to refer to the attached Agreement and the term "Commission" shall be
deemed to refer to the SEC.
Notwithstanding any other provision of the Offer, Acquisition shall
not be required to accept for payment or, subject to any applicable rules and
regulations of the Commission, including without limitation, Rule 14e-1(c) under
the Exchange Act (relating to Acquisition's obligation to pay for or return
Shares promptly after termination or withdrawal of the Offer), pay for any
Shares tendered pursuant to the Offer, and may postpone the acceptance for
payment or, subject to the restriction referred to above, payment for any Shares
tendered pursuant to the Offer, and may terminate or amend the Offer and not
accept for payment any Shares, if (i) the Minimum Condition shall not have been
satisfied, or (ii) any applicable waiting period under the HSR Act shall not
have expired or been terminated; provided, that prior to April 15, 1997, (or, if
the conditions to the Offer have not been satisfied prior to April 15, 1997 as
the result of the receipt by the Company of an Acquisition Proposal or as a
result of a failure of the applicable waiting period under the HSR Act to expire
or the failure to obtain any necessary governmental or regulatory approvals,
prior to July 15, 1997) Acquisition shall not terminate the Offer by reason of
the nonsatisfaction of any of the conditions and shall extend the Offer, or
(iii) Acquisition shall not have been reasonably satisfied that the provisions
of Section 203 of the Delaware General Corporation Law are inapplicable to the
Offer and Merger, or (iv) at any time on or after five days after announcement
and prior to the acceptance for payment of Shares, any of the following
conditions occurs:
(a) there shall have been any action or proceeding brought by any
governmental authority before any court located or having jurisdiction within
the United States or Canada or any statute, regulation, legislation, judgment or
order, enacted, entered, enforced, promulgated, amended, issued or deemed
applicable to the Offer or the Merger by any court, governmental, administrative
or regulatory authority or agency located or having jurisdiction within the
United States or Canada that could result in a Material Adverse Effect and have
the effect of: (i) making illegal, or otherwise directly or indirectly
restraining or prohibiting or imposing material penalties or fines or requiring
the payment of material damages in connection with the making of, the Offer, the
acceptance for payment of, payment for, or ownership, directly or indirectly, of
some of or all the Shares by Parent or Acquisition, the consummation of the
Offer or the Merger; (ii) prohibiting or materially limiting the direct or
indirect ownership or operation by the Company or by Parent of all or any
material portion of the business or assets of the Company and its subsidiaries,
taken as a whole, or compelling Parent to dispose of or hold separate all or any
material portion of the business or assets of the
<PAGE>
Company and its subsidiaries, taken as a whole, as a result of the transactions
contemplated by the Merger Agreement; (iii) imposing or confirming material
limitations on the ability of Parent effectively to hold or to exercise full
rights of ownership of Shares, including, without limitation, the right to vote
any Shares on all matters properly presented to the stockholders of the Company;
or (iv) requiring divestiture by Parent or Acquisition, directly or indirectly,
of any Shares; or
(b) the Company shall have breached or failed to perform in any
material respect any of its covenants or agreements under the Merger Agreement
or any of the representations and warranties of the Company set forth in the
Merger Agreement shall not be true and correct both when made and as of the date
of consummation of the Offer (except to the extent such representations and
warranties of the Company address matters only as of a particular date, in which
case as of such date) except where the failure to perform such covenants or
agreements or the failure of such representation and warranties to be so true
and correct would not have a Material Adverse Effect; or
(c) The Merger Agreement shall have been terminated in accordance with
its terms or the Offer shall have been amended or terminated with the consent of
the Company;
which, in the reasonable judgment of Acquisition in any such case, and
regardless of the circumstances (including any action or omission by Acquisition
not inconsistent with the Merger Agreement) giving rise to any such condition,
makes it inadvisable to proceed with such acceptance for payment or payments of
Shares.
The foregoing conditions are for the sole benefit of Acquisition
and may be asserted by Acquisition regardless of the circumstances giving
rise to any such condition or may be waived by Acquisition in whole or in
part at any time or from time to time in its sole discretion. The failure by
Acquisition at any time to exercise any of the foregoing rights shall not be
deemed a waiver of any such right, the waiver of any such right with respect
to particular facts or circumstances shall not be deemed a waiver with
respect to any other facts or circumstances, and each such right shall be
deemed an ongoing right that may be asserted at any time or from time to time.
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