<PAGE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
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
--------------------------
MARK VII, INC.
(Name of Subject Company)
MSAS ACQUISITION CORPORATION
MSAS GLOBAL LOGISTICS INC.
OCEAN GROUP PLC
(Bidders)
COMMON STOCK, $0.05 PAR VALUE PER SHARE
(Title of Class of Securities)
570414102
(CUSIP Number of Class of Securities)
JOHN M. ALLAN
CHIEF EXECUTIVE
OCEAN GROUP PLC
OCEAN HOUSE, THE RING
BRACKNELL, BERKSHIRE RG12 1AW
UNITED KINGDOM
44-1344-302-000
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications on Behalf of Bidder)
COPIES TO:
STEVEN R. FINLEY
GIBSON, DUNN & CRUTCHER LLP
200 PARK AVENUE
NEW YORK, NEW YORK 10166
(212) 351-4000
CALCULATION OF FILING FEE
<TABLE>
<CAPTION>
TRANSACTION VALUATION AMOUNT OF FILING FEE
<S> <C>
$241,386,656* $48,278
</TABLE>
* Estimated for purposes of calculating the amount of the filing fee only. The
filing fee calculation assumes the purchase of all outstanding shares of
common stock, $0.05 par value per share (the "Shares"), of Mark VII, Inc. at
a price of $23.00 per Share in cash, without interest. The filing fee
calculation is based on 8,995,515 Shares outstanding as of July 21, 1999 and
assumes the issuance prior to the consummation of the Offer (as defined
herein) of 1,499,557 Shares upon the exercise of outstanding stock options.
The amount of the filing fee calculated in accordance with Regulation
240.0-11 of the Securities Exchange Act of 1934, as amended, equals 1/50th
of one percent of the value of the transaction.
/ / CHECK BOX IF ANY PART OF THE FEE IS OFFSET AS PROVIDED BY RULES 0-11(a)(2)
AND IDENTIFY THE FILING WITH WHICH THE OFFSETTING FEE WAS PREVIOUSLY PAID.
IDENTIFY THE PREVIOUS FILING BY REGISTRATION STATEMENT NUMBER, OR THE FORM
OR SCHEDULE AND THE DATE OF ITS FILING.
<TABLE>
<S> <C> <C> <C>
Amount previously Filing
paid: None party: Not Applicable
Form or registration
no.: Not Applicable Date filed: Not Applicable
</TABLE>
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
SCHEDULE 14D-1
CUSIP NO. 570414102 Page 2 of 9 Pages
- --------------------------------------------------------------------------------
(1) NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
MSAS Acquisition Corporation
- --------------------------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) / /
(b) / /
- --------------------------------------------------------------------------------
(3) SEC USE ONLY
- --------------------------------------------------------------------------------
(4) SOURCE OF FUNDS:
AF
- --------------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM
2(e) OR 2(f)
/ /
- --------------------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
Delaware
- --------------------------------------------------------------------------------
(7) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
751,272 Shares(1)
- --------------------------------------------------------------------------------
(8) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN SHARES
/ /
- --------------------------------------------------------------------------------
(9) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
8.4%(1)
- --------------------------------------------------------------------------------
(10) TYPE OF REPORTING PERSON
CO
- --------------------------------------------------------------------------------
(1) MSAS Acqusition Corporation does not directly own any Shares.
The Shares are composed of the following: 751,272 Shares in the aggregate
which are the subject of Tender and Voting Agreements and Irrevocable
Proxies dated July 27, 1999 (the "Voting Agreements"), which MSAS Global
Logistics Inc., an indirect wholly owned subsidiary of Ocean Group plc
("Parent"), and MSAS Acquisition Corporation, a wholly owned subsidiary of
Parent ("Purchaser"), have entered into with the following six directors of
the Company: R.C. Matney, David H. Wedaman, James T. Graves, William E.
Greenwood, Thomas J. Fitzgerald and Dr. Jay U. Sterling (the "Proxy
Grantors"). Pursuant to the Voting Agreements, upon the terms and subject to
the conditions therein, each Proxy Grantor has agreed to tender to Purchaser
all Shares beneficially owned by such Proxy Grantor, has agreed with Parent
and Purchaser to vote such Shares in favor of approval of the Merger
Agreement and the transactions contemplated thereby and has granted an
irrevocable proxy to Purchaser with respect to such Shares.
2
<PAGE>
SCHEDULE 14D-1
CUSIP NO. 570414102 Page 3 of 9 Pages
- --------------------------------------------------------------------------------
(1) NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
MSAS Global Logistics Inc.
- --------------------------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) / /
(b) / /
- --------------------------------------------------------------------------------
(3) SEC USE ONLY
- --------------------------------------------------------------------------------
(4) SOURCE OF FUNDS:
AF
- --------------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM
2(e) OR 2(f)
/ /
- --------------------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
New York
- --------------------------------------------------------------------------------
(7) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
751,272 Shares(2)
- --------------------------------------------------------------------------------
(8) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN SHARES
/ /
- --------------------------------------------------------------------------------
(9) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
8.4%(2)
- --------------------------------------------------------------------------------
(10) TYPE OF REPORTING PERSON
CO
- --------------------------------------------------------------------------------
- ------------------------
(2) MSAS Global Logistics Inc. does not directly own any Shares. As set forth in
footnote 1 above, the 751,272 Shares are the subject of Voting Agreements.
3
<PAGE>
SCHEDULE 14D-1
CUSIP NO. 570414102 Page 4 of 9 Pages
- --------------------------------------------------------------------------------
(1) NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY)
Ocean Group plc
- --------------------------------------------------------------------------------
(2) CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP*
(a) / /
(b) / /
- --------------------------------------------------------------------------------
(3) SEC USE ONLY
- --------------------------------------------------------------------------------
(4) SOURCE OF FUNDS:
AF
- --------------------------------------------------------------------------------
(5) CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEM
2(e) OR 2(f)
/ /
- --------------------------------------------------------------------------------
(6) CITIZENSHIP OR PLACE OF ORGANIZATION
United Kingdom
- --------------------------------------------------------------------------------
(7) AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON
751,272 Shares(3)
- --------------------------------------------------------------------------------
(8) CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CERTAIN SHARES
/ /
- --------------------------------------------------------------------------------
(9) PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
8.4%(3)
- --------------------------------------------------------------------------------
(10) TYPE OF REPORTING PERSON
HC
- --------------------------------------------------------------------------------
- ------------------------
(3) Ocean Group plc does not directly own any Shares. As set forth in footnote 1
above, the 751,272 Shares are the subject of Voting Agreements.
4
<PAGE>
INTRODUCTION
This Tender Offer Statement on Schedule 14D-1 (this "Statement") relates to
the offer by MSAS Acquisition Corporation, a Delaware corporation ("Purchaser")
and a wholly owned subsidiary of MSAS Global Logistics Inc., a New York
corporation ("Parent"), which is an indirect wholly owned subsidiary of Ocean
Group plc, a public limited company organized under the laws of England and
Wales ("Ocean Group"), to purchase all outstanding shares of common stock, $0.05
par value per share (the "Shares"), of Mark VII, Inc., a Delaware corporation
(the "Company"), at a price of $23.00 per Share, net to the tendering
stockholder in cash without interest thereon, upon the terms and subject to the
conditions set forth in the Offer to Purchase, dated July 29, 1999 (the "Offer
to Purchase"), and the related Letter of Transmittal (which, together with any
amendments or supplements thereto, collectively together constitute the
"Offer"), copies of which are attached hereto as Exhibits (a)(1) and (a)(2),
respectively. The Offer is being made pursuant to an Agreement and Plan of
Merger, dated as of July 27, 1999, by and among the Company, Parent and
Purchaser which provides, among other things, that as promptly as practicable
after the satisfaction or, if permissible, waiver of the conditions set forth
therein (including the purchase of Shares pursuant to the Offer), Purchaser will
be merged with and into the Company (the "Merger"), with the Company continuing
as the surviving corporation and a wholly owned subsidiary of Parent. Upon
consummation of the Merger, each issued Share that is outstanding immediately
prior to the Merger (other than any Shares held by the Company, Parent or
Purchaser, or any subsidiary of the Company or Parent, and other than Shares
held by the Company's stockholders who have properly exercised appraisal rights
under Delaware law), will be converted automatically into the right to receive
the amount paid per Share in the Offer, in cash, without interest thereon, upon
surrender of the certificate representing the Share.
The information contained in this Statement concerning the Company,
including information concerning the deliberations, approvals and
recommendations of the Board of Directors of the Company in connection with the
transaction, the opinion of the financial advisor to such Board of Directors,
and the Company's capital structure and financial information, was supplied by
the Company. None of Purchaser, Parent or Ocean Group takes any responsibility
for the accuracy of such information.
ITEM 1. ISSUER AND CLASS OF SECURITY SUBJECT TO THE TRANSACTION
(a) The name of the subject company is Mark VII, Inc., a Delaware
corporation, which has its principal executive offices at 965 Ridge Lake
Boulevard, Suite 100, Memphis, Tennessee 38120.
(b) The class of equity securities being sought is the Company's common
stock. The information set forth in the Offer to Purchase under the caption
"INTRODUCTION" is incorporated herein by reference.
(c) The information concerning the principal market in which the Shares are
traded and certain high and low sales prices for the Shares in such principal
market set forth in the Offer to Purchase under the caption "THE TENDER
OFFER--6. Price Range of the Shares" is incorporated herein by reference.
ITEM 2. IDENTITY AND BACKGROUND
(a)-(d),(g) This Statement is filed by Ocean Group, Parent and Purchaser.
The information concerning the name, state or other place of organization,
principal business and address of the principal office of Ocean Group, Parent
and Purchaser, and the name, business address, present principal occupation or
employment (including the name, age, principal business and address of any
corporation or other organization in which such employment or occupation is
conducted), material occupations, positions, offices or employment during the
last five years and citizenship of each of the executive officers and directors
of Ocean Group, Parent and Purchaser is set forth in the Offer to Purchase under
the captions "INTRODUCTION" and "THE TENDER OFFER--8. Certain Information
Concerning Ocean Group, Parent and Purchaser," and in Schedule I to the Offer to
Purchase, and is incorporated herein by reference.
5
<PAGE>
(e) and (f) During the last five years, none of Ocean Group, Parent,
Purchaser, or, to the best of Ocean Group's, Parent's and Purchaser's knowledge,
any person listed in Schedule I to the Offer to Purchase has been (i) convicted
in a criminal proceeding (excluding traffic violations or similar misdemeanors)
or (ii) a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
activities subject to, federal or state securities laws or finding any
violations of such laws.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS
(a) The information set forth in the Offer to Purchase under the captions
"INTRODUCTION," "THE TENDER OFFER--8. Certain Information Concerning Ocean
Group, Parent and Purchaser," and "THE TENDER OFFER--10. Certain Transactions
Between Ocean Group and the Company" is incorporated herein by reference.
(b) The information set forth in the Offer to Purchase under the captions
"INTRODUCTION," "THE TENDER OFFER--8. Certain Information Concerning Ocean
Group, Parent and Purchaser," "THE TENDER OFFER--10. Certain Transactions
Between Ocean Group and the Company," and "THE TENDER OFFER--11. Contacts with
the Company; Background of the Offer and the Merger" is incorporated herein by
reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
(a) and (b) The information set forth in the Offer to Purchase under the
caption "THE TENDER OFFER--9. Source and Amount of Funds" is incorporated herein
by reference.
(c) Not applicable.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSAL OF THE BIDDER
(a)-(e) The information set forth in the Offer to Purchase under the
captions "INTRODUCTION," "THE TENDER OFFER--12. Purpose of the Offer; The Merger
Agreement" and "THE TENDER OFFER--13. The Merger Agreement; Appraisal Rights in
the Merger; Voting Agreements" is incorporated herein by reference.
(f) and (g) The information set forth in the Offer to Purchase under the
caption "THE TENDER OFFER--17. Effects of the Offer on the Market for Shares;
Nasdaq National Market; Exchange Act Registration" is incorporated herein by
reference.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY
(a) and (b) The information set forth in the Offer to Purchase under the
captions "THE TENDER OFFER--10. Certain Transactions Between Ocean Group and the
Company," "THE TENDER OFFER--12. Purpose of the Offer; The Merger Agreement" and
"THE TENDER OFFER--13. The Merger Agreement; Appraisal Rights in the Merger;
Voting Agreements" 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 the captions "THE
TENDER OFFER--10. Certain Transactions Between Ocean Group and the Company,"
"THE TENDER OFFER--12. Purpose of the Offer; The Merger Agreement" and "THE
TENDER OFFER--13. The Merger Agreement; Appraisal Rights in the Merger; Voting
Agreements" is incorporated herein by reference.
6
<PAGE>
ITEM 8. PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED
The information set forth in the Offer to Purchase under the caption "THE
TENDER OFFER--20. Fees and Expenses" is incorporated herein by reference.
ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS
Not applicable.
ITEM 10. ADDITIONAL INFORMATION
(a) Except as disclosed in Items 3 and 7 above, there are no present or
proposed material contracts, arrangements, understandings or relationships
between Ocean Group, Parent or Purchaser, or to the best of Ocean Group's,
Parent's and Purchaser's knowledge, any of the persons listed in Schedule I to
the Offer to Purchase, and the Company, or any of the Company's executive
officers, directors, controlling persons or subsidiaries.
(b) and (c) The information set forth in the Offer to Purchase under the
caption "THE TENDER OFFER--19. Certain Legal Matters; Regulatory Approvals" is
incorporated herein by reference.
(d) The information set forth in the Offer to Purchase under the caption
"THE TENDER OFFER--17. Effects of the Offer on the Market for Shares; Nasdaq
National Market; Exchange Act Registration" is incorporated herein by reference.
(e) None.
(f) The information set forth in the Offer to Purchase and the Letter of
Transmittal, to the extent not otherwise incorporated by reference, is
incorporated herein by reference.
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS
<TABLE>
<S> <C>
(a)(l) Offer to Purchase, dated July 29, 1999
(a)(2) Letter of Transmittal
(a)(3) Notice of Guaranteed Delivery
(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other
Nominees
(a)(5) Letter to Clients for Use by Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees
(a)(6) Guidelines for Certification of Taxpayer Identification Number on Substitute
Form W-9
(a)(7) Form of Summary Advertisement, dated July 29, 1999
(a)(8) Press Release dated July 27, 1999 issued by Ocean Group
(b) Revolving Credit Facility Commitment Letter, dated as of July 26, 1999,
between Ocean Group and Deutsche Bank
(c)(1) Agreement and Plan of Merger, dated as of July 27, 1999, by and among the
Company, Parent and Purchaser
(c)(2) Tender and Voting Agreement and Irrevocable Proxy, dated as of July 27, 1999,
among Parent, Purchaser and R. C. Matney
(c)(3) Tender and Voting Agreement and Irrevocable Proxy, dated as of July 27, 1999,
among Parent, Purchaser and David H. Wedaman
(c)(4) Tender and Voting Agreement and Irrevocable Proxy, dated as of July 27, 1999,
among Parent, Purchaser and James T. Graves
</TABLE>
7
<PAGE>
<TABLE>
<S> <C>
(c)(5) Tender and Voting Agreement and Irrevocable Proxy, dated as of July 27, 1999,
among Parent, Purchaser and William E. Greenwood
(c)(6) Tender and Voting Agreement and Irrevocable Proxy, dated as of July 27, 1999,
among Parent, Purchaser and Thomas J. Fitzgerald
(c)(7) Tender and Voting Agreement and Irrevocable Proxy, dated as of July 27, 1999,
among Parent, Purchaser and Dr. Jay U. Sterling
(c)(8) Stock Purchase and Stockholder Agreement, dated as of July 27, 1999, between
Ocean Group and R.C. Matney
(c)(9) Form of Stock Purchase and Stockholder Agreement between Ocean Group and
David H. Wedaman
(c)(10) Confidentiality Agreement, dated July 8, 1999, between Ocean Group and the
Company
(d) None
(e) Not applicable
(f) None
</TABLE>
8
<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.
<TABLE>
<S> <C> <C>
Dated: July 29, 1999 MSAS ACQUISITION CORPORATION
By: /s/ STUART A. YOUNG
--------------------------------------
Name: Stuart A. Young
Title: Secretary and Treasurer
</TABLE>
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.
<TABLE>
<S> <C> <C>
Dated: July 29, 1999 MSAS GLOBAL LOGISTICS INC.
By: /s/ MICK P. FOUNTAIN
--------------------------------------
Name: Mick P. Fountain
Title: Regional Chief Executive
</TABLE>
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.
<TABLE>
<S> <C> <C>
Dated: July 29, 1999 OCEAN GROUP PLC
By: /s/ JOHN M. ALLAN
--------------------------------------
Name: John M. Allan
Title: Chief Executive
</TABLE>
9
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
EXHIBIT SEQUENTIALLY
NUMBER EXHIBIT INDEX NUMBERED PAGE
- --------- -------------------------------------------------------------------------------------- ---------------------
<S> <C> <C>
(a)(l) Offer to Purchase, dated July 29, 1999................................................
(a)(2) Letter of Transmittal.................................................................
(a)(3) Notice of Guaranteed Delivery.........................................................
(a)(4) Letter to Brokers, Dealers, Commercial Banks, Trust Companies and Other Nominees......
(a)(5) Letter to Clients for Use by Brokers, Dealers, Commercial Banks, Trust Companies and
Other Nominees......................................................................
(a)(6) Guidelines for Certification of Taxpayer Identification Number on Substitute Form
W-9.................................................................................
(a)(7) Form of Summary Advertisement, dated July 29, 1999....................................
(a)(8) Press Release dated July 27, 1999 issued by Ocean Group...............................
(b) Revolving Credit Facility Commitment Letter, dated as of July 26, 1999, between Ocean
Group and Deutsche Bank.............................................................
(c)(1) Agreement and Plan of Merger, dated as of July 27, 1999, by and among the Company,
Parent and Purchaser................................................................
(c)(2) Tender and Voting Agreement and Irrevocable Proxy, dated as of July 27, 1999, among
Parent, Purchaser and R.C. Matney...................................................
(c)(3) Tender and Voting Agreement and Irrevocable Proxy, dated as of July 27, 1999, among
Parent, Purchaser and David H. Wedaman..............................................
(c)(4) Tender and Voting Agreement and Irrevocable Proxy, dated as of July 27, 1999, among
Parent, Purchaser and James T. Graves...............................................
(c)(5) Tender and Voting Agreement and Irrevocable Proxy, dated as of July 27, 1999, among
Parent, Purchaser and William E. Greenwood..........................................
(c)(6) Tender and Voting Agreement and Irrevocable Proxy, dated as of July 27, 1999, among
Parent, Purchaser and Thomas J. Fitzgerald..........................................
(c)(7) Tender and Voting Agreement and Irrevocable Proxy, dated as of July 27, 1999, among
Parent, Purchaser and Dr. Jay U. Sterling...........................................
(c)(8) Stock Purchase and Stockholder Agreement, dated as of July 27, 1999, between Ocean
Group and R.C. Matney...............................................................
(c)(9) Form of Stock Purchase and Stockholder Agreement between Ocean Group and David H.
Wedaman.............................................................................
(c)(10) Confidentiality Agreement, dated July 8, 1999, between Ocean Group and the Company....
(d) None..................................................................................
(e) Not applicable........................................................................
(f) None..................................................................................
</TABLE>
10
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
MARK VII, INC.
AT
$23.00 NET PER SHARE
BY
MSAS ACQUISITION CORPORATION
A WHOLLY OWNED SUBSIDIARY OF
MSAS GLOBAL LOGISTICS INC.
AN INDIRECT WHOLLY OWNED SUBSIDIARY OF
OCEAN GROUP PLC
- --------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON THURSDAY, AUGUST 26, 1999, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY
TENDERED BY THE EXPIRATION DATE AND NOT WITHDRAWN A NUMBER OF SHARES OF THE
COMMON STOCK OF MARK VII, INC., A DELAWARE CORPORATION (THE "COMPANY"), WHICH,
TOGETHER WITH ANY SHARES OWNED BY MSAS GLOBAL LOGISTICS INC. ("PARENT") OR MSAS
ACQUISITION CORPORATION ("PURCHASER"), CONSTITUTE AT LEAST A MAJORITY OF SHARES
ISSUED AND OUTSTANDING ON A FULLY-DILUTED BASIS ON THE DATE SHARES ARE ACCEPTED
FOR PAYMENT (THE "MINIMUM CONDITION") AND (2) THE SATISFACTION OR WAIVER OF
CERTAIN CONDITIONS TO THE OBLIGATIONS OF PURCHASER, PARENT AND THE COMPANY TO
CONSUMMATE THE TRANSACTIONS CONTEMPLATED BY THE MERGER AGREEMENT, INCLUDING
RECEIPT BY PURCHASER, PARENT AND THE COMPANY OF CERTAIN GOVERNMENTAL AND
REGULATORY APPROVALS.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE OFFER AND
THE MERGER AND HAS DETERMINED THAT THE TERMS OF THE OFFER AND THE MERGER ARE IN
THE BEST INTERESTS OF THE STOCKHOLDERS OF THE COMPANY, AND RECOMMENDS THAT
STOCKHOLDERS OF THE COMPANY ACCEPT THE OFFER AND TENDER THEIR SHARES HEREUNDER.
--------------------------
IMPORTANT
Any stockholder of the Company desiring to tender all or any portion of his
or her Shares (as defined herein) should either (1) complete and sign the
enclosed Letter of Transmittal, or a facsimile thereof, in accordance with the
Instructions in the Letter of Transmittal, have such stockholder's signature
thereon guaranteed (if required by Instruction 1 to the Offer to Purchase) mail
or deliver it, or send a facsimile thereof, and any other required documents to
the Depositary (as defined herein) and either deliver the certificates
evidencing such Shares to the Depositary along with the Letter of Transmittal or
tender such Shares pursuant to the procedure for book-entry transfer set forth
in Section 2 of this Offer to Purchase or (2) request such stockholder's broker,
dealer, commercial bank, trust company or other nominee to effect the
transaction for the stockholder. Stockholders having Shares registered in the
name of a broker, dealer, commercial bank, trust company or other nominee must
contact such broker, dealer, commercial bank, trust company or other nominee if
they desire to tender their Shares.
A stockholder of the Company who desires to tender Shares and whose
certificates evidencing 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 procedure
for guaranteed delivery set forth in Section 2 of this Offer to Purchase.
Questions and requests for assistance may be directed to the Dealer Manager
or the Information Agent at the addresses and telephone numbers set forth on the
back cover of the Offer to Purchase. Requests for additional copies of this
Offer to Purchase, the Letter of Transmittal or other tender offer materials may
be directed to the Information Agent at its address and telephone number set
forth on the back cover of this Offer to Purchase. Holders of Shares 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.
July 29, 1999
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
-----
<C> <S> <C>
INTRODUCTION.................................................................................................... 1
THE TENDER OFFER................................................................................................ 4
1. Terms of the Offer; Expiration Date.................................................................. 4
2. Procedure for Accepting the Offer and Tendering Shares............................................... 5
3. Withdrawal Rights.................................................................................... 8
4. Acceptance for Payment and Payment for Shares........................................................ 9
5. Certain Federal Income Tax Consequences.............................................................. 10
6. Price Range of the Shares............................................................................ 11
7. Certain Information Concerning the Company........................................................... 11
8. Certain Information Concerning Ocean Group, Parent and Purchaser..................................... 14
9. Source and Amount of Funds........................................................................... 17
10. Certain Transactions Between Ocean Group and the Company............................................. 18
11. Contacts with the Company; Background of the Offer and the Merger.................................... 18
12. Purpose of the Offer; The Merger Agreement........................................................... 20
13. The Merger Agreement; Appraisal Rights in the Merger; Voting Agreements.............................. 21
14. Interests of Certain Persons in the Merger........................................................... 33
15. Going Private Transactions........................................................................... 34
16. Dividends and Distributions.......................................................................... 34
17. Effects of the Offer on the Market for Shares; Nasdaq National Market; Exchange Act Registration..... 35
18. Certain Conditions of the Offer...................................................................... 36
19. Certain Legal Matters; Regulatory Approvals.......................................................... 37
20. Fees and Expenses.................................................................................... 39
21. Miscellaneous........................................................................................ 40
</TABLE>
<TABLE>
<S> <C>
SCHEDULE I............................................................................. I-1
</TABLE>
i
<PAGE>
To the Holders of Common Stock of Mark VII, Inc.:
INTRODUCTION
MSAS Acquisition Corporation, a Delaware corporation ("Purchaser") and a
newly formed wholly owned subsidiary of MSAS Global Logistics Inc., a New York
corporation ("Parent"), which is an indirect wholly owned subsidiary of Ocean
Group plc, a public limited company organized under the laws of England and
Wales ("Ocean Group"), hereby offers to purchase all of the issued and
outstanding shares of common stock, $0.05 par value per share (collectively, the
"Shares"), of Mark VII, Inc., a Delaware corporation (the "Company"), upon the
terms and subject to the conditions set forth in this Offer to Purchase and in
the related Letter of Transmittal (which, together with any amendments or
supplements thereto, collectively constitute the "Offer"), at a purchase price
of $23.00 per Share (the "Offer Price"), net to the seller in cash, without
interest thereon. NO DISSENTERS' OR APPRAISAL RIGHTS ARE AVAILABLE TO THE
COMPANY'S STOCKHOLDERS IN CONNECTION WITH THE OFFER.
The Offer is being made pursuant to the terms of the Agreement and Plan of
Merger, dated as of July 27, 1999 (the "Merger Agreement"), by and among the
Company, Parent and Purchaser. Among other things, the Merger Agreement provides
for the making of the Offer and that, following the purchase of Shares pursuant
to the Offer and promptly after the satisfaction or waiver of certain other
conditions, Purchaser will be merged with and into the Company (the "Merger").
Following the Merger, the Company will continue as the surviving corporation and
a wholly owned subsidiary of Parent (the "Surviving Corporation"). At the
effective time of the Merger, each outstanding Share (except for Shares held in
the treasury of the Company or owned by Parent or Purchaser, or by any
subsidiary of the Company or Parent, and except for Shares, if any, held by the
Company's stockholders who have properly exercised appraisal rights under
Delaware law, (the "Excluded Shares")), will be converted into the right to
receive the Offer Price, net to the holder in cash, without interest. APPRAISAL
RIGHTS ARE AVAILABLE TO THE COMPANY'S STOCKHOLDERS IN CONNECTION WITH THE MERGER
AS DESCRIBED IN "THE TENDER OFFER--13. THE MERGER AGREEMENT; APPRAISAL RIGHTS IN
THE MERGER; STOCK OPTION AGREEMENT; VOTING AGREEMENTS."
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE OFFER AND
THE MERGER AND HAS DETERMINED THAT THE TERMS OF THE OFFER AND THE MERGER ARE IN
THE BEST INTERESTS OF THE STOCKHOLDERS OF THE COMPANY, AND HAS RECOMMENDED THAT
THE STOCKHOLDERS OF THE COMPANY ACCEPT THE OFFER AND TENDER THEIR SHARES
HEREUNDER.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY
TENDERED BY THE EXPIRATION DATE AND NOT WITHDRAWN A NUMBER OF SHARES WHICH,
TOGETHER WITH ANY SHARES OWNED BY PARENT OR PURCHASER, CONSTITUTE AT LEAST A
MAJORITY OF THE SHARES OUTSTANDING ON A FULLY-DILUTED BASIS ON THE DATE THE
SHARES ARE ACCEPTED FOR PAYMENT (THE "MINIMUM CONDITION") AND (2) THE
SATISFACTION OR WAIVER OF CERTAIN CONDITIONS TO THE OBLIGATIONS OF PURCHASER,
PARENT AND THE COMPANY TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED BY THE MERGER
AGREEMENT, INCLUDING RECEIPT BY PURCHASER, PARENT AND THE COMPANY OF CERTAIN
GOVERNMENTAL AND REGULATORY APPROVALS. SEE "THE TENDER OFFER--18. CERTAIN
CONDITIONS OF THE OFFER."
THE OFFER WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY,
AUGUST 26, 1999, UNLESS EXTENDED.
Consummation of the Merger is subject to receipt of certain regulatory
approvals and satisfaction of a number of other conditions, including approval
by the stockholders of the Company if such approval is required by applicable
law. See "THE TENDER OFFER--19. Certain Legal Matters; Regulatory Approvals." If
Purchaser acquires a majority of the outstanding Shares, it will have sufficient
voting power
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to approve and adopt the Merger Agreement and the Merger without the vote of any
other stockholder of the Company. If Purchaser acquires at least 90% of the
outstanding Shares, Purchaser intends to approve and consummate the Merger
without any action by, or any further prior notice to, the other stockholders of
the Company pursuant to Section 253 of the Delaware General Corporation Law (the
"DGCL").
Parent and Purchaser have entered into a separate Tender and Voting
Agreement and Irrevocable Proxy (each a "Voting Agreement" and, collectively,
the "Voting Agreements") with each of the following six directors of the Company
(the "Proxy Grantors") who own in the aggregate 751,272 outstanding Shares,
representing approximately 8.4% of the issued and outstanding Shares: (a) R.C.
Matney, Chairman of the Board and Chief Executive Officer of the Company,
beneficially owns 701,380 outstanding Shares, (b) David H. Wedaman, a director
and Executive Vice President and Chief Operating Officer of the Company,
beneficially owns 2,742 outstanding Shares, (c) James T. Graves, a director and
General Counsel of the Company, beneficially owns 10,600 outstanding Shares, (d)
William E. Greenwood, a director of the Company, beneficially owns 9,800
outstanding Shares, (e) Thomas J. Fitzgerald, a director of the Company,
beneficially owns 13,650 outstanding Shares, and (f) Dr. Jay U. Sterling, a
director of the Company, beneficially owns 13,100 outstanding Shares. Pursuant
to the Voting Agreements, upon the terms and subject to the conditions therein,
each Proxy Grantor has agreed, provided the Merger Agreement has not been
terminated, to promptly tender to Purchaser all Shares beneficially owned by
such Proxy Grantor, has agreed to vote such Shares in favor of approval of the
Merger Agreement and the transactions contemplated thereby and has granted an
irrevocable proxy to Purchaser with respect to such Shares.
Each holder (other than holders of Excluded Shares) of a certificate
evidencing any Shares will, from and after the effective time of the Merger,
cease to have any rights with respect to such Shares, except the right to
receive the Offer Price. From and after the consummation of the Merger, each
Excluded Share will be canceled and extinguished and cease to exist without any
conversion thereof, and no payment will be made with respect thereto.
DEUTSCHE BANK SECURITIES INC. ("DEUTSCHE BANK"), FINANCIAL ADVISOR TO THE
COMPANY, HAS DELIVERED A WRITTEN OPINION TO THE BOARD, DATED JULY 26, 1999 (THE
"DEUTSCHE BANK OPINION"), TO THE EFFECT THAT, AS OF THAT DATE, THE CONSIDERATION
TO BE RECEIVED BY THE HOLDERS OF COMPANY COMMON STOCK PURSUANT TO THE MERGER
AGREEMENT WAS FAIR FROM A FINANCIAL POINT OF VIEW. THE FULL TEXT OF THE DEUTSCHE
BANK OPINION IS ATTACHED TO THE COMPANY'S SOLICITATION/RECOMMENDATION STATEMENT
ON SCHEDULE 14D-9 WHICH IS BEING MAILED TO STOCKHOLDERS OF THE COMPANY HEREWITH.
STOCKHOLDERS ARE URGED TO READ SUCH OPINION CAREFULLY AND IN ITS ENTIRETY FOR
ASSUMPTIONS MADE, MATTERS CONSIDERED AND LIMITS OF THE REVIEW OF DEUTSCHE BANK.
The Company has informed Purchaser that as of July 21, 1999 there were
8,995,515 Shares issued and outstanding and outstanding options to purchase
1,499,557 additional Shares. The Minimum Condition should therefore be satisfied
if at least approximately 5,247,536 Shares are validly tendered and not
withdrawn prior to the Expiration Date (up to 751,272 Shares will be tendered to
Purchaser pursuant to the Voting Agreements).
THE OFFER DOES NOT CONSTITUTE A SOLICITATION OF PROXIES FOR ANY MEETING OF
THE COMPANY'S STOCKHOLDERS. ANY SUCH SOLICITATION WOULD BE MADE ONLY PURSUANT TO
SEPARATE PROXY MATERIALS COMPLYING WITH THE REQUIREMENTS OF SECTION 14(a) OF THE
SECURITIES EXCHANGE ACT OF 1934, AS AMENDED (THE "EXCHANGE ACT").
Tendering stockholders will not be obligated to pay brokerage commissions,
solicitation fees or, subject to Instruction 6 of the Letter of Transmittal,
stock transfer taxes on the purchase of Shares
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pursuant to the Offer. However, any tendering stockholder or other payee who
fails to complete and sign the Substitute Form W-9 that is included in the
Letter of Transmittal may be subject to a required backup federal income tax
withholding of 31% of the gross proceeds payable to such stockholder or other
payee pursuant to the Offer. See "THE TENDER OFFER--5. Certain Federal Income
Tax Consequences." Purchaser will pay all charges and expenses of Merrill Lynch,
Pierce, Fenner & Smith Incorporated ("Merrill Lynch"), as Dealer Manager (in
such capacity, the "Dealer Manager"), BankBoston, N.A., as Depositary (in such
capacity, the "Depositary"), and Georgeson Shareholders Communications Inc., as
Information Agent (in such capacity, the "Information Agent"), incurred in
connection with the Offer. For a description of the fees and expenses to be paid
by Purchaser, see "THE TENDER OFFER--20. Fees and Expenses."
The information contained in this Offer to Purchase concerning the Company
was supplied by the Company. None of Ocean Group, Parent, Purchaser, the Dealer
Manager, the Depositary or the Information Agent takes any responsibility for
the completeness or accuracy of such information. The information contained in
this Offer to Purchase concerning the Offer, the Merger, Ocean Group, Parent and
Purchaser was supplied by Ocean Group, Parent and Purchaser. The Company takes
no responsibility for the completeness or accuracy of such information.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION WHICH SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE
WITH RESPECT TO THE OFFER. ALSO SEE "THE TENDER OFFER--21. MISCELLANEOUS" FOR
INFORMATION REGARDING CERTAIN ADDITIONAL DOCUMENTS FILED WITH THE SECURITIES AND
EXCHANGE COMMISSION (THE "COMMISSION") IN CONNECTION WITH THE OFFER.
References herein to Ocean Group will, unless the context indicates
otherwise, include Ocean Group and all of its subsidiaries, including Parent and
Purchaser.
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THE TENDER OFFER
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 any such extension or
amendment) and the Merger Agreement, Purchaser will accept for payment and pay
for all Shares validly tendered on or prior to the Expiration Date and not
theretofore withdrawn in accordance with the terms set forth in this Offer to
Purchase under the caption "3. Withdrawal Rights." The term "Expiration Date"
means 12:00 midnight, New York City time, on Thursday, August 26, 1999, unless
and until Purchaser, subject to restrictions contained in the Merger Agreement,
has extended the period of time during which the Offer is open, in which event
the term "Expiration Date" means the latest time and date at which the Offer, as
so extended by Purchaser, will expire.
Purchaser expressly reserves the right to waive any conditions of the Offer
(except as otherwise provided in the Merger Agreement), to increase the Offer
Price or to make any other changes in the terms and conditions of the Offer,
provided that, unless previously approved by the Company in writing, Purchaser
may not (i) decrease the Offer Price, (ii) change the form of consideration
payable in the Offer, (iii) decrease the number of Shares sought pursuant to the
Offer, (iv) add additional conditions to the Offer, (v) amend the conditions to
the Offer set forth in Annex A to the Merger Agreement to broaden their scope,
(vi) extend the Offer except as permitted by the terms of the Merger Agreement,
(vii) amend the Minimum Condition, or (viii) make other changes to the Offer
that are adverse to the holders of Shares.
Purchaser may, without the consent of the Company's Board of Directors (the
"Company Board"), (i) extend the Offer for any period required by any rule,
regulation, interpretation or position of the Commission applicable to the Offer
and (ii) extend the Offer on one occasion for an aggregate period of not more
than 20 business days beyond the latest Expiration Date that would otherwise be
permitted under clause (i) of this sentence if, on such Expiration Date, the
Minimum Condition has been satisfied and there have not been tendered at least
90% of the outstanding Shares. In addition, if by the time of any scheduled
Expiration Date any one or more of the conditions to the Offer set forth on
Annex A to the Merger Agreement are not satisfied, then, provided, that such
conditions are reasonably capable of being satisfied on or prior to October 7,
1999, Purchaser will extend the Offer from time to time unless any such
condition is no longer reasonably capable of being satisfied. In no event,
however, will Purchaser be required to extend the Offer beyond October 7, 1999.
As used in this Offer to Purchase, "business day" means any day, other than a
day on which the Nasdaq National Market is closed.
Subject to the applicable rules and regulations of the Commission, Purchaser
expressly reserves the right, subject to the terms and conditions of the Merger
Agreement, at any time and from time to time, upon the failure to be satisfied
of any of the conditions to the Offer, to (i) terminate or amend the Offer, (ii)
extend the Offer and postpone acceptance for payment of any Shares or (iii)
waive any condition, by giving oral or written notice of such termination,
amendment, extension or waiver to the Depositary. During any such extension, all
Shares previously tendered and not properly withdrawn will remain subject to any
such extension and will remain tendered, subject to the right of a tendering
stockholder to withdraw such stockholder's Shares. The ability of Purchaser to
delay payment for Shares that it has accepted for payment is limited by Rule
14e-1(c) under the Exchange Act, which requires that a tenderer pay the
consideration offered or return the tendered securities promptly after the
termination or withdrawal of a tender offer. If Parent or Purchaser waives any
of the conditions set forth in this Offer to Purchase under the caption "18.
Certain Conditions of the Offer," the Commission may, if the waiver is deemed to
constitute a material change to the information previously provided to Company
stockholders, require that the Offer remain open for an additional period of
time and/or that Purchaser disseminate information concerning such waiver.
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If Purchaser makes a material change in the terms of the Offer or the
information concerning the Offer or waives a material condition to the Offer,
Purchaser will disseminate additional tender offer materials (including by
public announcement as set forth above) and extend the Offer to the extent
required by Rules 14d-4(c), 14d-6(d) and 14e-1 under the Exchange Act. Such
rules generally provide that the minimum period during which a tender offer must
remain open following a material change in the terms of the offer or information
concerning the offer, other than a change in price or a change in percentage of
securities sought, will depend upon the facts and circumstances, including the
relative materiality of the changes in the terms or information. In the
Commission's view, an offer should remain open for a minimum of five business
days from the date a material change is first published, sent or given to
securityholders, and, if material changes are made with respect to information
that approaches the significance of price and share levels, a minimum of ten
business days may be required to allow for adequate dissemination and investor
response. With respect to a change in price or a change in percentage of
securities sought, a minimum ten business day period is generally required to
allow for adequate dissemination to stockholders and for investor response.
Any extension, amendment or termination of the Offer will be followed as
promptly as practicable by public announcement in accordance with the public
announcement requirements of Rule 14e-l(d) under the Exchange Act. Subject to
applicable law (including Rules 14d-4(c) and 14d-6(d) under the Exchange Act,
which require that any material change in the information published, sent or
given to stockholders in connection with the Offer be promptly disseminated to
them in a manner reasonably designed to inform stockholders of such change), and
without limiting the manner in which Purchaser may choose to make any public
announcement, Purchaser has no obligation to publish, advertise or otherwise
communicate any such public announcement other than by making a release to the
Dow Jones News Service.
The Company has provided Purchaser with the Company stockholder list, a
nonobjecting beneficial owners list and security position listings for the
purpose of disseminating the Offer to holders of Shares. This Offer to Purchase
and the Letter of Transmittal and other relevant materials will be mailed to
record holders of Shares and 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.
2. PROCEDURE FOR ACCEPTING THE OFFER AND TENDERING SHARES
VALID TENDER OF SHARES
For a stockholder to validly tender Shares pursuant to the Offer either: (a)
(i) a properly completed and duly executed Letter of Transmittal (or manually
signed facsimile thereof), together with any required signature guarantees, or
an Agent's Message (as defined herein) in connection with a book-entry delivery
of Shares, and any other required documents, must be received by the Depositary
at one of its addresses set forth on the back cover of this Offer to Purchase,
and (ii) either certificates for tendered Shares ("Share Certificates") must be
received by the Depositary at one of such addresses or such tendered Shares must
be delivered pursuant to the procedure for book-entry transfer described below
(and a Book-Entry Confirmation (as defined herein) received by the Depositary),
in each case prior to the Expiration Date; or (b) the tendering stockholder must
comply with the guaranteed delivery procedures described below.
BOOK-ENTRY TRANSFERS
The Depositary will establish an account with respect to the Shares at The
Depository Trust Company (the "Book-Entry Transfer Facility") for purposes of
the Offer within two business days after the date of this Offer to Purchase. Any
financial institution that is a participant in the Book-Entry Transfer Facility
may make book-entry delivery of the Shares by causing the book-entry transfer
system to transfer such
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Shares into the Depositary's account at the Book-Entry Transfer Facility in
accordance with the Book-Entry Transfer Facility's procedure for such transfer.
Although delivery of Shares may be effected through book-entry transfer at the
Book-Entry Transfer Facility, a properly completed and duly executed Letter of
Transmittal (or manually signed facsimile thereof), with any required signature
guarantees, or an Agent's Message (as defined herein) in connection with a
book-entry transfer, and any other required documents, must, in any case, be
transmitted to, and received by, the Depositary at one of its addresses set
forth on the back cover of this Offer to Purchase prior to the Expiration Date,
or the tendering stockholder must comply with the guaranteed delivery procedures
described below. The confirmation of a book-entry transfer of Shares into the
Depositary's account at the Book-Entry Transfer Facility as described above is
referred to herein as a "Book-Entry Confirmation." DELIVERY OF DOCUMENTS TO THE
BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH ITS BOOK-ENTRY PROCEDURES DOES
NOT CONSTITUTE VALID DELIVERY TO THE DEPOSITARY.
The term "Agent's Message" means a message, transmitted by the Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of the
Book-Entry Confirmation, which states that the Book-Entry Transfer Facility has
received an express acknowledgment from the participant in the Book-Entry
Transfer Facility tendering the Shares, that such participant has received the
Letter of Transmittal and agrees to be bound by the terms of the Letter of
Transmittal and that Purchaser may enforce such agreement against such
participant.
THE METHOD OF DELIVERY OF SHARES, THE LETTER OF TRANSMITTAL AND ALL OTHER
REQUIRED DOCUMENTS IS AT THE ELECTION AND SOLE RISK OF THE TENDERING
STOCKHOLDER, AND DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED AT THE
DEPOSITARY. IF DELIVERY IS BY MAIL, THEN INSURED OR REGISTERED MAIL WITH RETURN
RECEIPT REQUESTED IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME SHOULD BE
ALLOWED TO ENSURE TIMELY DELIVERY.
SIGNATURE GUARANTEES
No signature guarantee on the Letter of Transmittal is required if (i) the
Letter of Transmittal is signed by the registered holder of the Shares (which
term, for purposes of this Section, includes any participant in the Book-Entry
Transfer Facility system whose name appears on a security position listing as
the owner of the Shares) tendered therewith and such registered holder has not
completed either the box entitled "Special Delivery Instructions" or the box
entitled "Special Payment Instructions" on such Letter of Transmittal or (ii)
such Shares are tendered for the account of a bank, broker, dealer, credit
union, savings association or other entity that is a member in good standing of
the Securities Transfer Agents Medallion Program, the New York Stock Exchange
Medallion Signature Guarantee Program or the Stock Exchange Medallion Program
(each, an "Eligible Institution"). In all other cases, all signatures on the
Letter of Transmittal must be guaranteed by an Eligible Institution. See
Instructions 1 and 5 to the Letter of Transmittal. If the Share Certificates are
registered in the name of a person other than the signer of the Letter of
Transmittal, or if payment is to be made to, or Share Certificates not validly
tendered, not accepted for payment or not purchased are to be issued or returned
to, a person other than the registered holder of the Share Certificates, the
tendered Share Certificates must be endorsed in blank or accompanied by
appropriate stock powers, signed exactly as the name of the registered holder
appears on the Share Certificates with the signature on such Share Certificates
or stock powers guaranteed by an Eligible Institution. See Instructions 1 and 5
to 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 or the procedures
for book-entry transfer cannot be completed on a timely basis or time will not
permit all required documents to reach the Depositary prior to the
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Expiration Date, such Shares may nevertheless be tendered provided that all of
the following guaranteed delivery procedures are duly complied with:
(a) such tender is made by or through an Eligible Institution;
(b) the Depositary receives (by hand, mail, telegram or facsimile
transmission) on or prior to the Expiration Date, a properly completed and
duly executed Notice of Guaranteed Delivery, substantially in the form
provided by Purchaser; and
(c) the Share Certificates evidencing all tendered Shares, in proper
form for transfer (or Book-Entry Confirmation with respect to such Shares),
together with a properly completed and duly executed Letter of Transmittal
(or manually signed facsimile thereof) and any other documents required by
the Letter of Transmittal, are received by the Depositary within three
Nasdaq trading days after the date of such Notice of Guaranteed Delivery. A
"Nasdaq trading day" is any day on which securities are traded on the Nasdaq
National Market.
The Notice of Guaranteed Delivery may be delivered by hand, or may be
transmitted by telegram, facsimile transmission or mail, to the Depositary and
must include a guarantee by an Eligible Institution in the form set forth in
such Notice of Guaranteed Delivery.
Notwithstanding anything else described in this Offer to Purchase, 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 for (or a
timely Book-Entry Confirmation with respect to) such Shares, (ii) a properly
completed and duly executed Letter of Transmittal (or manually signed facsimile
thereof) or, in the case of book-entry transfer, an Agent's Message and (iii)
any other documents required by the Letter of Transmittal. Accordingly,
tendering stockholders may be paid at different times depending upon when Share
Certificates, Book-Entry Confirmations and such other documents are actually
received by the Depositary. Under no circumstances will interest be paid by
Purchaser on the purchase price of the Shares to any tendering stockholders,
regardless of any extension of the Offer or any delay in making such payment.
DETERMINATION OF VALIDITY
All questions as to the validity, form, eligibility (including time of
receipt) and acceptance for payment of any tender of Shares will be determined
by Purchaser in its sole discretion, which determination will be final and
binding. Purchaser reserves the absolute right to reject any or all tenders of
Shares that it determines are not in proper form or which the acceptance for
payment of or payment for may, in the opinion of Purchaser's counsel, be
unlawful. Purchaser also reserves the absolute right to waive any of the
conditions of the Offer or any defect or irregularity in the tender of any
Shares with respect to any particular stockholder, whether or not similar
defects or irregularities are waived in the case of other stockholders. None of
Purchaser, Parent, Ocean Group, the Dealer Manager, the Depositary, the
Information Agent, or any other person will be under any duty to give notice of
any defects or irregularities in tenders or incur any liability for failure to
give any such notice. 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.
OTHER REQUIREMENTS
By executing the Letter of Transmittal, a tendering stockholder irrevocably
appoints designees of Purchaser as such stockholder's attorneys-in-fact and
proxies, each 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
Purchaser (and with respect to any and all other Shares or other securities or
rights issued or issuable in respect of such Shares on or after the Expiration
Date), effective when, if and to the extent that Purchaser accepts such Shares
for payment
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pursuant to the Offer. All such attorneys-in-fact and proxies shall be
considered coupled with an interest in the tendered Shares. Upon such acceptance
for payment, all prior proxies given by such stockholder with respect to such
Shares accepted for payment or other securities or rights will, without further
action, be revoked, and no subsequent proxies may be given. Such designees of
Purchaser will, with respect to such Shares for which the appointment is
effective, be empowered to exercise all voting and other rights of such
stockholder as they in their sole discretion may deem proper in respect of 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. Purchaser reserves the right to require that, in order for Shares to
be deemed validly tendered, immediately upon Purchaser's payment for such
Shares, Purchaser must be able to exercise full voting rights with respect to
such Shares.
Purchaser's acceptance for payment of Shares tendered pursuant to any of the
procedures described herein will constitute a binding agreement between the
tendering stockholder and Purchaser upon the terms and subject to the conditions
of the Offer.
BACKUP FEDERAL INCOME TAX WITHHOLDING
To prevent backup federal income tax withholding on payments of cash
pursuant to the Offer, a stockholder tendering Shares in the offer must provide
the Depositary with such stockholder's correct taxpayer identification number
("TIN") on a Substitute Form W-9 and certify under penalties of perjury that
such TIN is correct and that such stockholder is not subject to backup
withholding. If a stockholder does not provide its correct TIN or fails to
provide the certification described herein, under U.S. federal income tax laws,
the Depositary will be required to withhold 31% of the amount of any payment
made to such stockholder pursuant to the Offer. All stockholders tendering
Shares pursuant to the Offer should complete and sign the Substitute Form W-9
included as a part of the Letter of Transmittal to provide the information and
certification necessary to avoid backup withholding. Noncorporate foreign
stockholders should complete and sign a Form W-8, Certificate of Foreign Status,
a copy of which may be obtained from the Depositary, in order to avoid backup
withholding. See Instruction 10 to the Letter of Transmittal.
3. WITHDRAWAL RIGHTS
Tendered Shares may be withdrawn at any time prior to the Expiration Date
only by following the procedures described below.
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 of the Shares to be withdrawn as set forth on such Share
Certificates if different from the name of the person who tendered such Shares.
If Share Certificates 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 furnished to the
Depositary and, unless such Shares have been tendered by an Eligible
Institution, the signatures on the notice of withdrawal must be guaranteed by an
Eligible Institution. If Shares have been delivered pursuant to the procedures
for book-entry transfer described in Section 2 above, any notice of withdrawal
must specify the name and number of the account at the Book-Entry Transfer
Facility to be credited with such withdrawn Shares and otherwise comply with the
Book-Entry Transfer Facility's procedures for withdrawal, in which case a notice
of withdrawal will be effective if delivered to the Depositary by any method of
delivery described in the first sentence of this paragraph.
All questions as to the form and validity (including time of receipt) of
notices of withdrawal will be determined by Purchaser in its sole discretion,
and its determination will be final and binding. None of Purchaser, Parent,
Ocean Group, the Dealer Manager, the Depositary, the Information Agent, or any
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other person will be obligated to give notice of any defects or irregularities
in any notice of withdrawal, nor will any of them incur any liability for
failure to give any such notice.
Withdrawals of tendered Shares may not be rescinded, and any Shares properly
withdrawn will thereafter be deemed not validly tendered for purposes of the
Offer. However, withdrawn Shares may be retendered by following one of the
procedures described in Section 2 above at any time on or prior to the
Expiration Date.
4. 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 the Offer, as so
extended or amended), promptly after the Expiration Date Purchaser will accept
for payment, and will pay for, any and all Shares validly tendered on or prior
to the Expiration Date and not properly withdrawn in accordance with Section 3
above. Subject to applicable rules of the Commission and the terms and
conditions of the Merger Agreement, Purchaser expressly reserves the right, in
its sole discretion, to delay acceptance for payment of, or payment for, Shares
in order to comply in whole or in part with any applicable law or government
regulation.
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
Share Certificates evidencing such Shares (or timely Book-Entry Confirmation of
the book-entry transfer of such Shares into the Depositary's account at the
Book-Entry Transfer Facility pursuant to the procedures set forth under Section
2 above), (ii) the Letter of Transmittal (or facsimile thereof), properly
completed and duly executed, together with any required signature guarantees, or
an Agent's Message in connection with a book-entry transfer and (iii) any other
documents required by the Letter of Transmittal.
For purposes of the Offer, Purchaser will be deemed to have accepted for
payment, and thereby purchased, Shares validly tendered to Purchaser and not
properly withdrawn as, if and when Purchaser gives oral or written notice to the
Depositary of Purchaser's acceptance for payment of such Shares. In all cases,
upon the terms and subject to the conditions of the Offer, payment for Shares so
accepted for payment will be made by the deposit of the purchase price therefor
with the Depositary, which will act as agent for tendering stockholders for the
purpose of receiving payment from Purchaser and transmitting payment to validly
tendering stockholders. UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID BY
PURCHASER ON THE PURCHASE PRICE OF THE SHARES TENDERED PURSUANT TO THE OFFER,
REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY DELAY IN MAKING SUCH PAYMENT.
Upon the deposit of funds with the Depositary for the purpose of making payments
to tendering stockholders, Purchaser's obligation to make such payments shall be
satisfied and tendering stockholders must thereafter look solely to the
Depositary for payment of amounts owed to them by reason of Purchaser's
acceptance for payment of Shares. Purchaser will pay any stock transfer taxes
with respect to the transfer and sale to it or on its order pursuant to the
Offer, except as otherwise provided in Instruction 6 of the Letter of
Transmittal, as well as any charges and expenses of the Depositary, the
Information Agent and the Dealer Manager.
If Purchaser is delayed in its acceptance for payment of, or payment for,
tendered Shares or is unable to accept for payment or pay for such Shares
pursuant to the Offer for any reason, then, without prejudice to Purchaser's
rights under the Offer (but subject to Purchaser's obligations under Rule
14e-l(c) under the Exchange Act to pay for or return the tendered Shares
promptly after the termination or withdrawal of the Offer), the Depositary may,
nevertheless, retain tendered Shares on behalf of Purchaser, and such Shares may
not be withdrawn except to the extent tendering stockholders are entitled to
exercise, and duly exercise, withdrawal rights as described under Section 3
above.
If any tendered Shares are not purchased pursuant to the Offer because of an
invalid tender or for any other reason, Share Certificates evidencing any such
Shares will be returned, without expense, to the tendering stockholder (or, in
the case of Shares delivered by book-entry transfer of such Shares into the
9
<PAGE>
Depositary's account at the Book-Entry Transfer Facility pursuant to the
procedures described in Section 2 above, such Shares will be credited to an
account maintained at the Book-Entry Transfer Facility) as promptly as
practicable following the expiration or termination of the Offer.
5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES
The summary of U.S. federal income tax consequences set forth below is for
general information only and is based on Purchaser's understanding of the law as
currently in effect. The tax consequences to 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, tax exempt organizations, persons who acquired
their Shares as part of a straddle, hedge or other integrated instrument, and
stockholders who acquired their Shares through the exercise of an employee stock
option or otherwise as compensation. 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 OF
CHANGES IN SUCH TAX LAWS.
The receipt of cash for Shares pursuant to the Offer (or the Merger,
including pursuant to the exercise of appraisal rights) will be a taxable
transaction for U.S. federal income tax purposes and may also be a taxable
transaction under applicable state, local or foreign tax laws. Generally, a
stockholder who receives cash for Shares pursuant to the Offer (or the Merger)
will recognize gain or loss for federal income tax purposes equal to the
difference between the amount of cash received in exchange for the Shares sold
and such stockholder's adjusted tax basis in such Shares. Provided that the
Shares constitute capital assets in the hands of the stockholder, such gain or
loss will be capital gain or loss, and will be long term capital gain or loss if
the stockholder has held the Shares for more than one year at the time of sale.
Gain or loss will be calculated separately for each block of Shares (i.e., a
group of Shares with the same tax basis and holding period) tendered pursuant to
the Offer. The maximum federal income tax rate applicable to non-corporate
taxpayers on long-term capital gain is 20%, and the use of capital losses to
offset other income is subject to limitations.
A stockholder (other than certain exempt stockholders including, among
others, all corporations and certain foreign individuals and entities) that
tenders Shares may be subject to 31% backup withholding unless the stockholder
provides its TIN and certifies that such number is correct or properly certifies
that it is awaiting a TIN, or unless an exemption applies. A stockholder who
does not furnish its TIN may be subject to a penalty imposed by the Internal
Revenue Service (the "IRS"). See "2. Procedure for Accepting the Offer and
Tendering Shares."
If backup withholding applies to a stockholder, the Depositary is required
to withhold 31% from payments to such stockholder. Backup withholding is not an
additional tax. Rather, the amount of the backup withholding can be credited
against the federal income tax liability of the person subject to the backup
withholding, provided that the required information is given to the IRS. If
backup withholding results in an overpayment of tax, a refund can be obtained by
the stockholder upon filing an appropriate income tax return on a timely basis.
10
<PAGE>
6. PRICE RANGE OF THE SHARES
The Shares are traded on the Nasdaq National Market under the symbol "MVII."
The following table sets forth, for the periods indicated, the high and low
sales prices of the Shares as reported on the Nasdaq National Market:
<TABLE>
<CAPTION>
TRADING
--------------------
<S> <C> <C>
HIGH LOW
--------- ---------
Fiscal Year Ended January 3, 1998:
First Quarter............................................................ $161/4 $1313/16
Second Quarter........................................................... $167/8 $137/8
Third Quarter............................................................ $163/4 $145/8
Fourth Quarter........................................................... $19 $131/2
Fiscal Year Ended January 2, 1999:
First Quarter............................................................ $19 $143/4
Second Quarter........................................................... $19 $17
Third Quarter............................................................ $181/4 $141/16
Fourth Quarter........................................................... $185/8 $137/8
Fiscal Year Ended January 1, 2000:
First Quarter............................................................ $187/8 $111/2
Second Quarter........................................................... $171/2 $111/4
Third Quarter (through July 28, 1999).................................... $227/8 $163/8
</TABLE>
On July 21, 1999, the last day of trading on which any Shares were traded
prior to the public announcement of the execution of the Merger Agreement,
according to published sources, the last reported sale price of the Shares on
the Nasdaq National Market was $17 5/8 per Share. On July 28, 1999, the last
full day of trading prior to the commencement of the Offer, according to
published sources, the last reported sale price of the Shares on the Nasdaq
National Market was $22 11/16 per Share. STOCKHOLDERS ARE URGED TO OBTAIN A
CURRENT MARKET QUOTATION FOR THE SHARES.
7. CERTAIN INFORMATION CONCERNING THE COMPANY
GENERAL
The Company is a Delaware corporation with its principal offices located at
965 Ridge Lake Boulevard, Suite 100, Memphis, Tennessee 38120.
The Company is a holding company, the principal asset of which is its
transportation services subsidiary. The Company is a service organization that
acts as a provider of transportation and logistics services. The Company
provides for transportation services by arranging for domestic and international
transportation by truck, rail, ship and air. The Company also provides
logistical management services by providing customers with value-added elements
of the distribution chain such as private fleet management, warehousing and
regional and local distribution.
AVAILABLE INFORMATION
The Shares are registered under the Exchange Act. Accordingly, the Company
is subject to the informational filing requirements of the Exchange Act and, in
accordance therewith, is required to file periodic reports, proxy statements and
other information with the Commission relating to its business, financial
condition and other matters. Certain information, as of particular dates,
concerning the Company's directors and officers (including their remuneration,
stock options granted to them and Shares held by them), the principal holders of
the Company's securities, and any material interest of such persons in
11
<PAGE>
transactions with the Company is required to be disclosed in proxy statements
and annual reports distributed to the Company's stockholders and filed with the
Commission. These reports, proxy statements and other information are available
for inspection and copying at the public reference facilities of the Commission
located in Judiciary Plaza, 450 Fifth Street, N.W., Room 1024, Washington, D.C.
20549, and at the regional offices of the Commission located in 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. The Commission also maintains an Internet site on the World Wide Web at
http://www.sec.gov that contains reports, proxy statements and other
information. In addition, such material should also be available for inspection
at The Nasdaq Stock Market, Inc., 1735 K Street, N.W., Washington, D.C. 20006.
SUMMARY FINANCIAL INFORMATION
Set forth below is certain selected consolidated financial information with
respect to the Company and its consolidated subsidiaries contained in the
Company's 1998 Annual Report on Form 10-K (the "Company 1998 Annual Report") and
the Company's Quarterly Reports on Form 10-Q for the quarters ended April 3,
1999 (the "Company First Quarter 1999 10-Q") and April 4, 1998 (the "Company
First Quarter 1998 10-Q"). More comprehensive financial information is included
in the Company 1998 Annual Report, the Company First Quarter 1999 10-Q and the
Company First Quarter 1998 10-Q and other documents filed by the Company with
the Commission, and the following summary is qualified in its entirety by
reference to the Company 1998 Annual Report, the Company First Quarter 1999 10-Q
and the Company First Quarter 1998 10-Q and such other documents and all the
financial information (including any related notes) contained therein. The
Company 1998 Annual Report, the Company First Quarter 1999 10-Q and the Company
First Quarter 1998 10-Q are available for inspection as described above under
"Available Information."
12
<PAGE>
THE COMPANY AND SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(AMOUNTS IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
THREE MONTHS ENDED YEAR ENDED
-------------------------- ----------------------------------------
APRIL 3, APRIL 4, JANUARY 2, JANUARY 3, DECEMBER 28,
1999 1998 1999 1998 1996
------------ ------------ ------------ ------------ ------------
<S> <C> <C> <C> <C> <C>
(UNAUDITED)
Statement of Income Data:
Operating Revenues............................. $ 183,784 $ 171,800 $ 724,948 $ 667,374 $ 563,913
Transportation Costs........................... 162,334 151,242 636,745 582,843 489,292
------------ ------------ ------------ ------------ ------------
Net Revenues................................... 21,450 20,558 88,203 84,531 74,621
Operating Expenses
Salaries and related costs................... 5,099 4,468 18,118 17,894 16,501
Selling, general and administrative
expenses................................... 12,925 13,340 53,496 54,279 47,915
Total operating expenses..................... 18,024 17,808 71,614 72,173 64,416
Operating Income............................... 3,426 2,750 16,589 12,358 10,205
Interest and Other (Income)/Expense, Net....... (385) (55) 372 (359) 253
------------ ------------ ------------ ------------ ------------
Income Before Provision for Income Taxes....... 3,811 2,805 16,217 12,717 9,952
Provision for Income Taxes..................... 1,543 1,178 6,649 5,341 4,180
------------ ------------ ------------ ------------ ------------
Net Income................................... $ 2,268 $ 1,627 $ 9,568 $ 7,376 $ 5,772
Net Income per Common Share:..................... $ 0.25 $ 0.18 $ 1.07 $ 0.80 $ 0.63
Net Income per Common Share,
Assuming Dilution:............................. $ 0.24 $ 0.17 $ 1.01 $ 0.76 $ 0.60
Average Common Shares and
Equivalents Outstanding:
Basic.......................................... 8,955 8,939 8,930 9,185 9,211
Diluted........................................ 9,411 9,467 9,449 9,699 9,616
Balance Sheet Data:
Working Capital................................ 28,571 18,480 25,381 17,860 20,030
Total Assets................................... 117,513 98,840 123,068 108,010 93,597
Long-Term Obligations.......................... 651 876 712 945 601
Shareholders' Investment....................... 43,577 33,778 41,243 32,122 30,038
</TABLE>
Except as otherwise noted in this Offer to Purchase, all of the information
with respect to the Company set forth in this Offer to Purchase has been derived
from publicly available information. Although Ocean Group, Parent and Purchaser
have no knowledge that any of such information is untrue, none of Ocean Group,
Parent, Purchaser, the Dealer Manager, the Depositary or the Information Agent
takes any responsibility for the accuracy or completeness of information
contained in this Offer to Purchase with respect to the Company or for any
failure by the Company to disclose events which may have occurred or may affect
the significance or accuracy of any such information.
13
<PAGE>
CERTAIN COMPANY PROJECTIONS
During the course of the discussions between Ocean Group and the Company,
the Company provided Ocean Group with certain business and financial information
that was not publicly available. Such information included the Company's
financial projections relating to the Company's 1999 and 2000 operating budgets
prepared by management.
The Company's projections which were furnished to Ocean Group anticipated
gross revenues less transportation costs of approximately $94.8 million and
$105.5 million for the fiscal years ended on or about December 31, 1999 and
December 31, 2000, respectively. Net income was projected at approximately $11.4
million and $13.9 million for fiscal years ended on or about December 31, 1999
and December 31, 2000, respectively.
According to the Company, the Company's projections were not prepared with a
view to public disclosure or compliance with published guidelines of the
Commission or the guidelines established by the American Institute of Certified
Public Accountants regarding projections, and are included in this Offer to
Purchase only because such projections were provided to Ocean Group. None of
Parent, Purchaser or Ocean Group or any of their representatives assumes any
responsibility for the accuracy of the Company's projections. While presented
with numerical specificity, the Company's projections are based upon a variety
of assumptions (not all of which were stated therein and not all of which were
provided to Ocean Group) relating to the businesses of the Company which may not
be realized and are subject to significant financial, market, economic and
competitive uncertainties and contingencies which are difficult or impossible to
predict accurately, many of which are beyond the control of the Company. There
can be no assurance that the results in the projections will be realized, and
actual results may vary materially from those shown. The inclusion of the
Company's projections should not be regarded as a representation by Ocean Group,
Parent, Purchaser or any of their respective affiliates or representatives or by
the Company or any of its affiliates or representatives that the budgeted
results will be achieved. The Company's projections should be read together with
the financial statements of the Company referred to herein.
8. CERTAIN INFORMATION CONCERNING OCEAN GROUP, PARENT AND PURCHASER
GENERAL
Ocean Group is a public limited company organized under the laws of England
and Wales with its principal offices located at Ocean House, The Ring,
Bracknell, Berkshire RG12 1AW, United Kingdom. Ocean Group and its subsidiaries
operate primarly in the following three businesses: global logistics (MSAS
Global Logistics), marine services (Cory Towage) and environmental services
(Cory Environmental).
MSAS Global Logistics offers customers a customized set of services from a
broad range of supply chain capabilities, including: global transportation,
regional distribution, inventory control, warehousing, value-added services
(including product assembly, configuration, testing, repair and after-sales
service) and information management. The global services network extends across
more than 550 locations in 112 countries.
Cory Towage is an international marine services supplier operating 60 tugs
world-wide. Towage services include harbor and terminal work, fire-fighting and
pollution control services, vessel escorting and coastal towage. Related marine
services include workboats, pilotage, linehandling, SPM/navigational aid
maintenance, newbuild supervision, training and cunsultancy. Currently, Cory
Towage operates in the United Kingdom, where Ocean Group believes it is the
second largest towage provider, as well as Ireland, Canada, South America and
the Middle East.
Ocean Group believes that Cory Environmental is one of the United Kingdom's
leading environmental service companies. Its waste management activities include
the operation of long-term contracts for the landfill disposal of waste for
London, Gloucestershire, Essex and Kent together with landfill sites, waste
14
<PAGE>
transfer stations and a tug and barge fleet on the Thames river handling
approximately 15% of London's municipal waste. Cory Environmental also provides
refuse collection, street cleansing, recycling and ancillary services to eight
local authorities.
Parent is a New York corporation with its principal executive offices
located at 4120 Point Eden Way, Suite 200, Hayward, California 94545. Parent is
an indirect wholly owned subsidiary of Ocean Group. As described above, Parent
and its subsidiaries operate mainly in the logistics segment of Ocean Group's
business.
Purchaser, a Delaware corporation, is a newly formed, wholly owned
subsidiary of Parent which was organized to acquire the Company and has not
conducted any unrelated activities since its organization. Purchaser's principal
executive offices are located at c/o MSAS Global Logistics Inc., 4120 Point Eden
Way, Suite 200, Hayward, California 94545.
SUMMARY FINANCIAL INFORMATION
Because the only consideration in the Offer and the Merger is cash and there
is no financing condition, each of Ocean Group, Parent and Purchaser believes
that the financial condition of Ocean Group and its subsidiaries is not material
to a decision by a holder of Shares whether to sell, tender or hold Shares
pursuant to the Offer. Notwithstanding the foregoing, set forth below is certain
summary selected consolidated financial information with respect to Ocean Group.
Ocean Group publishes its financial statements in pounds sterling (L). Such
information is provided for supplemental information purposes only and is
neither intended nor required to comply with the requirements of the Exchange
Act. On July 28, 1999, The Wall Street Journal reported that, as of July 27,
1999, one pound sterling equalled approximately 1.59 U.S. dollars. The selected
consolidated financial data of Ocean Group and its subsidiaries set forth below
for the three calendar year periods ended December 31, 1998 have been derived
from the audited financial statements of Ocean Group (the "Ocean Group Audited
Statements"). The following summary is qualified in its entirety by reference to
the Ocean Group Audited Statements and the related notes contained therein.
The Ocean Group Audited Statements have been prepared in accordance with
United Kingdom generally accepted accounting principles ("UK GAAP"), which
practices are described in the notes to such statements. UK GAAP differs in
significant respects from generally accepted accounting principles in the United
States ("US GAAP"). The principal differences relevant to understanding the
Ocean Group financial information are set forth below.
15
<PAGE>
OCEAN GROUP AND SUBSIDIARIES
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(AMOUNTS IN MILLIONS OF POUNDS STERLING, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
YEAR ENDED
----------------------------------------
<S> <C> <C> <C>
DECEMBER 31, DECEMBER 31, DECEMBER 31,
1998 1997 1996
------------ ------------ ------------
Summary of Earnings Data:
Net revenues........................................................ L 1,326.7 L 1,164.2 L 1,141.5
Operating income.................................................... 65.2 61.6 66.3
Net income.......................................................... 56.5 246.7 44.0
Basic Earnings per common share..................................... 0.361 1.573 0.282
Diluted earnings per common share................................... 0.357 1.556 0.280
Weighted average common shares outstanding.......................... 156.5 156.8 156.0
Weighted average common shares outstanding, assuming dilution....... 158.3 158.5 157.0
</TABLE>
<TABLE>
<CAPTION>
AT AT
DECEMBER 31, DECEMBER 31,
1998 1997
------------ ------------
<S> <C> <C> <C>
Balance Sheet Data:
Total assets........................................................ L 833.7 L 860.3
Total current liabilities........................................... 390.1 376.8
Total liabilities................................................... 473.3 439.2
Total stockholders' equity.......................................... 356.7 418.7
</TABLE>
- ------------------------
CERTAIN DIFFERENCES BETWEEN UK GAAP AND US GAAP
Although UK GAAP differs in certain significant respects from US GAAP, Ocean
Group believes that the differences are not material to a decision by a holder
of Shares whether to sell, tender or hold any Shares because any such
differences would not affect the ability of Purchaser to obtain sufficient funds
to pay for the Shares to be acquired pursuant to the Offer. While the following
is not a comprehensive summary of all the differences between UK GAAP and US
GAAP, other differences are unlikely to have a significant effect on the
consolidated income or shareholder's funds of Purchaser.
GOODWILL AND US PURCHASE ACCOUNTING. Under US GAAP and UK GAAP, purchase
consideration in respect of subsidiaries acquired is allocated on the basis of
appraised values to the various net assets of the subsidiaries at the dates of
acquisition and any net balance is treated as goodwill. US GAAP requires
goodwill to be recognized as an asset and amortized over its estimated useful
life not to exceed 40 years. Under UK GAAP, prior to December 31, 1997, goodwill
is written off directly against reserves. Since January 1, 1998, goodwill is
capitalized and written off over periods generally less than 20 years.
ORDINARY DIVIDENDS. Under UK GAAP, final ordinary dividends are provided
for in the fiscal year in respect of which they are recommended by the board of
directors for approval by the shareholders. Under US GAAP, such dividends are
not provided for until declared by the board of directors.
DEFERRED TAXATION. Under UK GAAP, no provision is made for deferred
taxation if there is reasonable evidence that such deferred taxation will not be
payable in the foreseeable future, deferred tax assets are generally not
recognized under UK GAAP unless they are likely to be recovered in the
foreseeable future (i.e. one year from the balance sheet date). Under US GAAP,
deferred tax assets and liabilities are recognized in full and any net deferred
tax assets are then assessed for probable recoverability. As long as
16
<PAGE>
it is more likely than not that sufficient future taxable income will be
available to utilize the deferred tax assets, no valuation allowance is
provided.
DIRECTORS AND OFFICERS
The name, age, business or residence address, citizenship, present principal
occupation or employment and five-year employment history of each of the
directors and executive officers of Ocean Group, Parent and Purchaser are set
forth in Schedule I hereto.
Except as described in this Offer to Purchase, (i) none of Ocean Group,
Parent or Purchaser or, to the best of Ocean Group's, Parent's and Purchaser's
knowledge, any of the persons listed in Schedule I hereto, or any associate or
subsidiary of Ocean Group, beneficially owns or has any right to acquire
directly or indirectly any Shares or has any contract, arrangement,
understanding or relationship with any other person with respect to any Shares,
including, but not limited to, any contract, arrangement, understanding or
relationship concerning the transfer or the voting of any Shares, joint
ventures, loan or option arrangements, puts or calls, guaranties of loans,
guaranties against loss, or the giving or withholding of proxies, and (ii) none
of Ocean Group, Parent or Purchaser or, to the best of Ocean Group's, Parent's
and Purchaser's knowledge, any of the other persons referred to above, or any of
the respective directors, executive officers or subsidiaries of any of the
foregoing, has effected any transaction in the Shares during the past 60 days.
Except as set forth in this Offer to Purchase, since December 28, 1996, none
of Ocean Group, Parent or Purchaser or, to the best of Ocean Group's, Parent's
and Purchaser's knowledge, any of the persons listed in Schedule I to this Offer
to Purchase, has had any transaction with the Company or any of its executive
officers, directors or affiliates that is 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 December 28, 1996, there have been no
contacts, negotiations or transactions between Ocean Group or any of its
subsidiaries or, to the best of Ocean Group's, Parent's and Purchaser's
knowledge, any of the persons listed in Schedule I to this Offer to Purchase, on
the one hand, and the Company or its affiliates, on the other hand, concerning a
merger, consolidation or acquisition, a tender offer for or other acquisition of
securities of any class of the Company, an election of directors of the Company,
or a sale or other transfer of a material amount of assets of the Company or any
of its subsidiaries.
9. SOURCE AND AMOUNT OF FUNDS
Purchaser estimates that the total amount of funds required by Purchaser to
consummate the Offer and the Merger, including the fees and expenses of the
Offer and the Merger, is estimated to be approximately $230 million. Purchaser
will obtain all such funds from Ocean Group in the form of loans. Ocean Group
has received a commitment (the "Commitment") from Deutsche Bank AG London
("Deutsche Bank") to provide approximately $278 million in financing.
Ocean Group obtained a commitment letter and related term sheet (the
"Commitment Letter") from Deutsche Bank to provide a multi-currency revolving
credit facility in a maximum principal amount of approximately $278 million (the
"Facility"), the proceeds of which are to be utilized to finance the cost of the
Offer and Merger and related fees, costs and expenses, working capital and other
corporate purposes. In connection with the Facility, Ocean Group will be
obligated to comply with certain financial covenants, the breach of which will
constitute a default with respect to the Facility. Deutsche Bank intends to
syndicate the Facility.
The Commitment Letter provides that the final maturity date of the Facility
is five years from the signing of the Facility Agreement. The Facility will bear
interest at the London Interbank Offered Rate ("LIBOR") plus 0.60% per annum
plus certain fees. The Commitment is subject to, among other matters, the
following conditions: (i) not less than a majority of the Shares having been
acquired by Purchaser
17
<PAGE>
pursuant to the Offer, (ii) the receipt of all required regulatory approvals,
(iii) the negotiation, execution and delivery of definitive documentation, (iv)
a legal opinion from Deutsche Bank's counsel, (v) confirmation that various
representation and warranties of Ocean Group are correct and (vi) receipt of
copies of legal and environmental diligence reports required by Deutsche Bank.
A copy of the Commitment Letter has been filed as an exhibit to the Schedule
14D-1. Reference is hereby made to such exhibit for a more complete description
of the terms and conditions of the Commitment Letter. When the definitive
documentation with respect to the Facility is executed, copies of such
documentation will be filed as exhibits to the Schedule 14D-1.
It is anticipated that borrowing under the Facility will be repaid from
funds generated internally by Ocean Group and its subsidiaries or other sources,
which may include proceeds from bank borrowings or the sale of debt or equity
securities or some combination thereof. Ocean Group has not made any decisions
for such repayment and will determine the actual source of funds for repayments
only after the completion of its review of the Company and its analysis of then
prevailing market conditions, including interest rates and other economic
conditions.
10. CERTAIN TRANSACTIONS BETWEEN OCEAN GROUP AND THE COMPANY
Except as described in this Offer to Purchase, (i) none of Ocean Group,
Parent or Purchaser or, to the best of Ocean Group's, Parent's and Purchaser's
knowledge, any of the persons listed in Schedule I hereto, or any associate or
subsidiary of Ocean Group, beneficially owns or has any right to acquire
directly or indirectly any Shares or has any contract, arrangement,
understanding or relationship with any other person with respect to any Shares,
including, but not limited to, any contract, arrangement, understanding or
relationship concerning the transfer or the voting of any Shares, joint
ventures, loan or option arrangements, puts or calls, guaranties of loans,
guaranties against loss, or the giving or withholding of proxies, and (ii) none
of Ocean Group, Parent or Purchaser or, to the best of Ocean Group's, Parent's
and Purchaser's knowledge, any of the other persons referred to above, or any of
the respective directors, executive officers or subsidiaries of any of the
foregoing, has effected any transaction in the Shares during the past 60 days.
Except as set forth in this Offer to Purchase, since December 28, 1996, none
of Ocean Group, Parent or Purchaser or, to the best of Ocean Group's, Parent's
and Purchaser's knowledge, any of the persons listed in Schedule I to this Offer
to Purchase, has had any transaction with the Company or any of its executive
officers, directors or affiliates that is 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 December 28, 1996, there have been no
contacts, negotiations or transactions between Ocean Group or any of its
subsidiaries or, to the best of Ocean Group's, Parent's and Purchaser's
knowledge, any of the persons listed in Schedule I to this Offer to Purchase, on
the one hand, and the Company or its affiliates, on the other hand, concerning
(i) a merger, consolidation or acquisition, (ii) a tender offer for or other
acquisition of securities of any class of the Company, (iii) an election of
directors of the Company or (iv) a sale or other transfer of a material amount
of assets of the Company or any of its subsidiaries.
On July 8, 1999, Ocean Group and the Company entered into a Confidentiality
Agreement in contemplation of exchange of information relating to potential
merger negotiations.
11. CONTACTS WITH THE COMPANY; BACKGROUND OF THE OFFER AND THE MERGER
Over a period of years, the Company and Ocean Group have exchanged basic
financial information and discussed from time to time various strategic
relationships.
In December 1998, R.C. Matney, Chief Executive Officer of the Company,
called John Allan, Chief Executive of Ocean Group, to discuss strategic fit
between the two companies and other companies in the
18
<PAGE>
industry. At that time, the companies signed a confidentiality agreement and the
Company provided certain financial information to Ocean Group.
In January 1999, Ian Smith, Group Commercial Director of Ocean Group and
Stuart Young, Director of Mergers & Acquisitions of Ocean Group, met with Mr.
Matney in New York. At this meeting, the parties exchanged information on the
trading performance and the strategic prospects of the two companies. The
parties discussed the perceived and actual strengths and weaknesses of their
respective companies and the industry. The parties agreed to hold further
discussions.
On February 11, 1999, during a BT Alex. Brown Transportation conference in
Naples, Florida, Mr. Smith briefly met with Mr. Matney and Mark Skoda, the newly
appointed President of the Company, and suggested additional meetings.
In March 1999, Mr. Allan sent a letter to Mr. Matney indicating that Ocean
Group wished to suspend contact with the Company for several months so that
Ocean Group could focus its attention on other matters.
In late May 1999, Mr. Allan sent a letter to Mr. Matney suggesting a meeting
between Messrs. Smith, Young and Michael Fountain, Regional Chief Executive of
the Americas Pacific Region for Parent, and a representative of the Company.
On June 4, 1999, Messrs. Smith, Young and Fountain met with Mr. Matney in
Indianapolis. At this meeting, the strategic fit between the two companies was
discussed. Mr. Matney requested that if Ocean Group desired to pursue a possible
transaction with the Company, it submit a letter of interest outlining a
proposal within ten days of the meeting.
On June 14, 1999, Mr. Smith sent a letter of interest to Mr. Matney. The
letter outlined a nonbinding offer by Ocean Group to acquire the Company. In a
telephone conversation later that day, Mr. Matney told Mr. Smith that he felt
the letter provided the basis for him to inform the Company Board that he had
received an offer from Ocean Group which he felt was worthy of consideration.
On June 22, 1999, Mr. Allan informed the board of directors of Ocean Group
of the discussions with the Company. The board of directors authorized
management of Ocean Group to continue discussions with the Company, perform
diligence on the Company and work towards negotiating a form of definitive
agreement.
On June 28, 1999, Messrs. Smith and Young met with Mr. Matney in
Indianapolis and discussed possible structures for an acquisition and set a
tentative timetable for proceeding forward.
On June 29, 1999, Messrs. Smith, Young and Fountain met in Memphis with
Messrs. Matney, Skoda, David Wedaman, Executive Vice President and Chief
Operating Officer, Michael Musacchio, President of an indirect subsidiary of the
Company, Robert Liss, President of the Special Services Division of the
Company's transportation services subsidiary, and James Graves, General Counsel.
At this meeting, the two sides exchanged detailed descriptions of their
businessees. At the conclusion of the meeting, the parties decided that they
should move forward and attempt to negotiate a definitive agreement.
On June 30, 1999, Messrs. Smith and Fountain met individually with the
senior officers of the Company to discuss financial and business diligence.
On July 6, Messrs. Smith, Allan, Fountain and John Coghlan, Finance Director
of Ocean Group, met with members of the Company Board and outlined Ocean Group's
strategy and the reasons why the Company would provide a compelling strategic
fit.
From July 7, 1999 until July 14, 1999, Ocean Group, together with its legal
and financial advisors, conducted its due diligence review of the Company.
During the course of this review, the Company made available to Ocean Group and
its representatives legal and financial information and discussed the Company's
business and operations.
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On July 8, 1999, Ocean Group and the Company executed a confidentiality and
standstill agreement.
On July 9, 1999, counsel for Ocean Group delivered a draft Merger Agreement
and related documents to counsel for the Company.
On the morning of July 13, 1999, counsel for the Company provided counsel
for Ocean Group with comments on the draft Merger Agreement.
On July 13 and 14, 1999, Ocean Group, together with their respective legal
and financial advisors, met in New York at the offices of Gibson, Dunn and
Crutcher LLP to negotiate the terms of the Merger Agreement and ancillary
documents. The parties were unable to agree on several key terms of the Merger
Agreement, including price, and negotiations broke off on the afternoon of July
14.
On July 15, 1999, Mr. Fountain called Mr. Matney and they discussed the
major open issues, including price.
On July 19, 1999, Messrs. Young and Smith called Mr. Matney to say that
Ocean Group desired to continue discussions in order to attempt to reach
agreements on the key transaction terms.
On July 20, 1999, Mr. Matney telephoned Mr. Allan and indicated that the
Company was interested in restarting negotiations and that he believed that the
parties could reach an agreement on the terms of the Merger Agreement.
On July 22, 1999 Messrs. Smith and Allan spoke with Mr. Matney. Various
aspects of the deal were discussed, including price and deal protection.
Although no agreement was reached, the parties believed that their differences
were narrowing and the parties agreed to talk again the next day.
On the morning of July 23, 1999, Mr. Allan spoke with Mr. Matney, and they
agreed that the parties should resume face to face negotiations. Later that day,
revised transaction documentation was circulated by counsel for Ocean Group.
On July 26, 1999, Messrs. Young and Smith, together with their legal and
financial advisors, met with Mr. Fitzgerald, and his legal advisors, in New York
at the offices of Gibson, Dunn & Crutcher LLP to negotiate a definitive Merger
Agreement. The parties concluded their negotiations of the Merger Agreement and
finalized the press releases to announce the transaction.
Early on the morning of July 27, 1999, the parties executed the Merger
Agreement and related agreements.
On July 27, 1999, before the Nasdaq National Market opened for trading,
Ocean Group and the Company publicly announced that they had entered into the
Merger Agreement. The Offer formally commenced on the date of this Offer to
Purchase.
12. PURPOSE OF THE OFFER; THE MERGER AGREEMENT
The purpose of the Offer is for Parent to acquire, indirectly, the entire
equity interest in the Company. The purpose of the Merger is for Parent to
acquire all of the equity interest in the Company not acquired pursuant to the
Offer. Upon consummation of the Merger, the Company will become a direct wholly
owned subsidiary of Parent. The acquisition of the entire equity interest in the
Company has been structured as a cash tender offer followed by a cash merger in
order to provide a prompt transfer of ownership of the equity interest in the
Company from the Company's stockholders to Parent and to provide the Company's
stockholders with cash for all of their Shares.
Under the DGCL, the approval of the Company Board and, under certain
circumstances, the affirmative vote of the holders of a majority of the Shares
present at a duly constituted meeting, is required to approve and adopt the
Merger Agreement and the transactions contemplated thereby. If a vote of the
stockholders is required, the Company has agreed in the Merger Agreement to take
all actions, in
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accordance with the DGCL and its Certificate of Incorporation and bylaws,
necessary to convene and hold a meeting of its stockholders (the "Stockholders'
Meeting"), as promptly as practicable after the acceptance for payment of Shares
by Purchaser pursuant to the Offer, to consider and vote upon the adoption and
approval of the Merger Agreement and the transactions contemplated thereby. A
proxy statement, containing detailed information concerning the Merger, will be
furnished to stockholders of the Company in connection with any Stockholders'
Meeting. Notwithstanding the foregoing, if Parent, Purchaser and/or any other
subsidiary of Parent has acquired at least 90% of the outstanding Shares, the
parties will take all necessary and appropriate actions to cause the Merger to
become effective as soon as practicable after the expiration of the Offer
without a Stockholders' Meeting in accordance with Section 253 of the DGCL.
At a meeting held on July 26, 1999 the Company Board unanimously (a)
determined that the Merger Agreement and the transactions contemplated thereby,
including the Offer and the Merger, are in the best interests of the Company's
stockholders, (b) approved and adopted the Merger Agreement and authorized the
execution thereof by the Company and (c) recommended that the Company's
stockholders accept the Offer and tender their Shares thereunder. As described
above, the only remaining corporate action of the Company that may be required
is the approval and adoption of the Merger Agreement and the transactions
contemplated thereby by the holders of a majority of the Shares. If the Minimum
Condition is satisfied, Purchaser will have sufficient voting power to cause the
approval and adoption of the Merger Agreement and the transactions contemplated
thereby without the affirmative vote of any other stockholder of the Company.
Under the Merger Agreement, Parent has agreed to vote, or cause to be voted, at
any such meeting, all Shares owned by it, Purchaser or any other subsidiary of
Parent in favor of the Merger. If Purchaser acquires at least 90% of the Shares
in the Offer, under Section 253 of the DGCL, it will be able to consummate the
Merger without a vote of the Company's stockholders.
13. THE MERGER AGREEMENT; APPRAISAL RIGHTS IN THE MERGER; VOTING AGREEMENTS
THE MERGER AGREEMENT
The following is only a summary of certain provisions of the Merger
Agreement. Company stockholders should read the Merger Agreement in its
entirety. A copy of the Merger Agreement is filed with the Commission as an
exhibit to Ocean Group's, Parent's and Purchaser's Tender Offer Statement on
Schedule 14D-l.
THE OFFER. The Merger Agreement provides for the making of the Offer.
Pursuant to the offer, each tendering stockholder will receive the Offer Price
for each Share tendered in the Offer. Purchaser's obligation to accept for
payment or pay for Shares is subject to the satisfaction of the conditions that
are described in "18. Certain Conditions of the Offer," including the Minimum
Condition. Pursuant to the Merger Agreement, Purchaser expressly reserves the
right to waive any of the conditions to the Offer (except for the Minimum
Condition or as otherwise provided in the Merger Agreement), and to make any
change in the terms or conditions of the Offer; provided that, without the
written consent of the Company, Purchaser may not (i) decrease the Offer Price,
(ii) change the form of consideration payable in the Offer, (iii) decrease the
number of Shares sought pursuant to the Offer, (iv) add additional conditions to
the Offer, (v) amend the conditions to the Offer set forth in Annex A to the
Merger Agreement to broaden their scope, (vi) extend the Offer except as
permitted by the terms of the Merger Agreement, (vii) amend the Minimum
Condition, or (viii) make other changes to the Offer that are adverse to holders
of the Shares.
Notwithstanding the foregoing, Purchaser may, without the consent of the
Company Board, (i) extend the Offer for any period required by any rule,
regulation, interpretation or position of the Commission applicable to the Offer
and (ii) extend the Offer on one occasion for an aggregate period of not more
than 20 business days beyond the latest Expiration Date that would otherwise be
permitted under clause (i) of this sentence if on such Expiration Date the
Minimum Condition has been satisfied and there shall not have been tendered at
least 90% of the outstanding Shares. In addition, if by the time of any
scheduled
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Expiration Date any one or more of the conditions to the Offer set forth on
Annex A to the Merger Agreement are not satisfied, then provided, that such
conditions are reasonably capable of being satisfied on or prior to October 7,
1999, Purchaser will extend the Offer from time to time unless any such
condition is no longer reasonably capable of being satisfied. In no event,
however, will Purchaser be required to extend the Offer beyond October 7, 1999.
BOARD REPRESENTATION. Promptly upon the purchase by Purchaser of the Shares
pursuant to the Offer and if the Minimum Condition has been met, Parent will be
entitled to designate such number of directors, rounded up to the next whole
number, on the Company Board as is equal to the product of the total number of
directors on the Company Board (determined after giving effect to the directors
elected pursuant to this sentence) and the percentage that the aggregate number
of Shares so purchased bears to the total number of Shares then outstanding on a
fully diluted basis. Notwithstanding the foregoing, the Company shall ensure
that three of the members of the Company Board as of July 27, 1999, who are
neither officers of the Company or any of its subsidiaries nor officers or
directors of Purchaser or any of its affiliates (the "Continuing Directors")
will remain members of the Company Board until the Effective Time (as defined
herein). If a Continuing Director resigns from the Company Board, Parent,
Purchaser and the Company will permit the remaining Continuing Director or
Directors to appoint the resigning Director's successor who shall be deemed to
be a Continuing Director. Following the election or appointment of Parent's
designees to the Company Board pursuant to the Merger Agreement and prior to the
Effective Time (as defined herein), the following shall require the written
concurrence of a majority of the Continuing Directors: (i) any amendment or
waiver of any term or condition of the Merger Agreement or the Certificate of
Incorporation or bylaws of the Company, (ii) any termination of the Merger
Agreement by the Company, (iii) any extension by the Company of the time for the
performance of any of the obligations or other acts of Parent or Purchaser, (iv)
any exercise or waiver of any of the Company's rights or remedies under the
Merger Agreement or (v) any other determination with respect to any action to be
taken or not to be taken by the Company relating to the Merger Agreement. The
Company's obligation to appoint designees of Parent to the Company Board will be
subject to Section 14(f) of the Exchange Act and Rule 14f-1 thereunder.
THE MERGER. No later than the second business day after the satisfaction or
waiver of the conditions to the Merger, unless another time is agreed to by
Parent and the Company, Purchaser will be merged with and into the Company, as a
result of which the separate corporate existence of Purchaser will cease and the
Company will continue as the Surviving Corporation and a wholly owned subsidiary
of Parent. The effective time of the Merger (the "Effective Time") will occur at
the date and time that a certificate of merger in such form and manner as
required by the DGCL (the "Certificate of Merger") is filed with the Secretary
of State of the State of Delaware, or such later time as Parent and the Company
may agree upon and as may be set forth in the Certificate of Merger. The
Surviving Corporation will continue its corporate existence under the laws of
the State of Delaware. The Certificate of Incorporation of Purchaser in effect
immediately prior to the Effective Time will be the Certificate of Incorporation
of the Surviving Corporation. The bylaws of Purchaser in effect immediately
prior to the Effective Time shall be the bylaws of the Surviving Corporation.
The directors of Purchaser at the Effective Time will be the directors of the
Surviving Corporation until their successors are duly elected and qualified, and
the officers of the Company at the Effective Time will be the officers of the
Surviving Corporation until their successors are duly elected and qualified.
CONSIDERATION TO BE PAID IN THE MERGER. In the Merger, each outstanding
Share (except for Shares held in the Company's treasury or Shares owned by
Parent or Purchaser or by any subsidiary of the Company or Parent, which will be
canceled and retired without any payment with respect thereto, and except for
Shares held by the Company's stockholders who have properly exercised appraisal
rights under Delaware law) will be converted into the right to receive the Offer
Price, without interest thereon (the "Merger Consideration"). Each share of
common stock of Purchaser issued and outstanding immediately prior to the
Effective Time will be converted into one share of common stock of the Surviving
Corporation.
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At or immediately prior to the Effective Time, each option, warrant or other
right to purchase shares (in each case, a "Company Stock Option") of the common
stock of the Company (the "Company Common Stock") which is outstanding and each
then outstanding stock appreciation right with respect to shares of Company
Common Stock (in each case, an "SAR"), whether or not then vested or
exercisable, will be canceled by the Company. In consideration of such
cancellation of Company Stock Options and SARs with an exercise price of less
than the Offer Price, the Company (or, at Parent's option, Purchaser) will pay
to such holders of Company Stock Options and SARs an amount equal to the product
of (i) the excess of the Offer Price over the exercise price of each such
Company Stock Option or SAR, as applicable, and (ii) the number of Shares
previously subject to such Company Stock Option or SAR, as applicable,
immediately prior to its cancellation (such payment to be net of withholding
taxes and without interest).
REPRESENTATIONS AND WARRANTIES. The Merger Agreement contains
representations and warranties by the Company, on the one hand, and Parent and
Purchaser, on the other hand. These include:
- due organization, existence, good standing and qualification to do
business and, in the case of the Company and its subsidiaries.
- corporate power and authority to enter into the Merger Agreement and
perform its obligations under the Merger Agreement; proper execution,
delivery and enforceability of the Merger Agreement.
- material governmental and third party approvals.
- compliance of the Merger Agreement with each party's charter documents,
material agreements and applicable law.
- absence of material legal proceedings and injunctions.
- absence of broker's fees arising from the transactions contemplated by the
Merger Agreement.
The Merger Agreement contains additional representations and warranties of
the Company. These include:
- capitalization of the Company and its subsidiaries.
- approval of the Merger Agreement by the Company Board.
- absence of existing defaults under its charter documents, material
agreements and applicable law.
- filings with the Commission and accuracy of financial statements.
- absence of undisclosed liabilities of the Company and its subsidiaries and
since January 2, 1999 absence of material changes in the business of the
Company and its subsidiaries.
- the Company's and its subsidiaries' compliance with applicable law.
- employee benefit plans, labor, employment and related matters.
- absence of material environmental liabilities.
- payment of taxes and filing of tax returns.
- intellectual property.
- "Year 2000" compliance.
- insurance.
- certain business practices.
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- customers.
- stockholder vote necessary for approval of the Merger Agreement and the
Merger.
- inapplicability of takeover statutes.
The Merger Agreement contains additional representations and warranties of
Parent and Purchaser. These include:
- availability of financing.
- operations of Purchaser.
No representations or warranties made by the Company, Parent or Purchaser
shall survive beyond the Effective Time.
CONDUCT OF BUSINESS BEFORE THE MERGER. Each of the Company, Parent and
Purchaser has agreed to do certain things before the Merger occurs. These
include the Company and its subsidiaries each:
- using commercially reasonable efforts to conduct its business in the
ordinary course of business consistent with past practice.
- using commercially reasonable efforts to preserve intact its business
organization.
- using commercially reasonable efforts to keep available the services of
its current key officers and employees.
- using commercially reasonable efforts to preserve its relationships with
key customers, suppliers, lessors, creditors, employees, contractors and
others having business dealings with it.
Parent, and in certain cases Purchaser, and the Company have also agreed to:
- cause the information supplied or to be supplied by it for inclusion or
incorporation by reference in the Proxy Statement, in the case of the
Company, or in the Schedule 14D-1, this Offer to Purchase and the Proxy
Statement, in the case of Parent and Purchaser, not to contain any
materially untrue statements or misleading omissions.
- use all reasonable efforts to cooperate in the preparation and filing of
the Proxy Statement and antitrust filings, obtain consents and approvals
of all third parties and governmental authorities necessary to complete
the transactions contemplated by the Merger Agreement, contest any legal
proceeding relating to the Merger and execute additional instruments
necessary to consummate the transactions contemplated by the Merger
Agreement.
- not issue any press release or make any other public statements without
the prior approval of the other party, which approval may not be
unreasonably withheld except as required by law or by the rules and
regulations of the Nasdaq National Market, following a change in the
recommendation of the Merger by the Company Board, or if the Company Board
is advised that such release or statement is required by law and such
release or statement relates to a Third Party Acquisition.
- promptly tell the other party about any events or circumstances that would
cause any representations or warranties to be untrue or inaccurate in any
material respect or any failure to comply with or satisfy in any material
respect its obligations under the Merger Agreement.
Subject to certain agreed exceptions, the Company has agreed for itself and
on behalf of its subsidiaries not to:
- amend its charter documents.
- issue or agree to issue any stock of any class or any other debt or equity
securities or equity equivalents, except for shares of Company Common
Stock issued under options outstanding on July 27, 1999.
- split, combine or reclassify any shares of Company Common Stock or
declare, set aside or pay any dividend or other distribution of any kind
in respect of its capital stock.
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- adopt a plan of complete or partial liquidation, dissolution, merger or
other reorganization other than the Merger.
- alter any material subsidiary's corporate structure, other than as a
result of the transactions contemplated by the Merger Agreement.
- incur or assume any long-term or short-term debt or issue any debt
securities, except under existing lines of credit in the ordinary course
of business, or materially change the terms of such long-term or
short-term debt or debt securities.
- become responsible for the obligations of any other person, except for
third party guarantees and lease agreements not to exceed $250,000 in the
aggregate and obligations of the Company's subsidiaries incurred in the
ordinary course of business consistent with past practice.
- make any loans to or investments in any other person, except for loans to
or investments in its subsidiaries or customary loans or advances to
employees in the ordinary course of business consistent with past
practice.
- encumber its capital stock.
- mortgage or pledge any of its material assets or create or permit any
material lien on these assets.
- except as required by law, enter into, adopt, amend or terminate any
employee compensation, benefit or similar plan, materially increase the
compensation or fringe benefits of any director, officer or employee or
pay any benefit not required by any plan or arrangement in effect as of
July 27, 1999.
- grant any severance or termination pay, except as required by law, any
written agreements existing on July 27, 1999 or current severance
policies.
- accelerate the vesting of any stock options, except as provided in any
policy, plan, agreement or other arrangement in effect as of July 27,
1999.
- sell, lease, license or dispose of any assets in any single transaction or
series of related transactions having a fair market value in excess of
$250,000 in the aggregate.
- enter into any exclusive license, distribution, marketing, sales or other
agreement other than in the ordinary course of business.
- except as required as a result of a change in law or in generally accepted
accounting principles, change any of its accounting principles, practices
or methods.
- revalue in any material respect any of its assets other than in the
ordinary course of business consistent with past practice or as required
by generally accepted accounting principles.
- acquire any other business or entity or any material equity interest of
any business or entity.
- enter into any material agreement.
- modify or waive any material right under its or its subsidiaries' material
contracts.
- modify its standard warranty or contract terms or modify any existing
warranty or contract terms in any material and adverse manner.
- authorize any new or additional capital expenditure(s) in excess of
$250,000.
- acquire any other asset or related group of assets, or make any
investment, in a single transaction or series of related transactions with
a cost in excess of $250,000.
- make any material tax election or settle or compromise any material income
tax liability.
- permit any insurance policy naming it as a beneficiary or loss payee to
expire, be canceled or be terminated, unless a comparable insurance policy
is obtained and in effect.
- fail to file any tax returns when due or fail to cause such tax returns
when filed to be complete and accurate in all material respects.
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- fail to pay any taxes or other material debts when due.
- settle or compromise any legal proceeding which relates to the Merger
Agreement, the settlement or compromise of which would involve more than
$250,000 or which would otherwise have a material adverse effect on the
Company.
- take or agree in writing to take any of the actions described above or any
action that would make any of the Company's representations and warranties
contained in the Merger Agreement untrue or incorrect in any material
respect.
The Company also has agreed that it will:
- provide Parent with reasonable access to the Company's books and records,
offices, facilities, employees and personnel files of current employees.
- provide Parent with such financial and operating data and other
information with respect to its business and properties and its
subsidiaries' business and properties as reasonably requested by Parent.
Each of Parent and Purchaser has agreed to hold and treat in confidence all
information concerning the Company and its subsidiaries furnished to it in
connection with the transactions contemplated by the Merger Agreement, pursuant
to the Confidentiality Agreement, dated July 8, 1999, between the Company and
Parent.
In addition, Parent has agreed to furnish the Company with a letter from
Ocean Group stating that Ocean Group will provide sufficient funds to Parent and
Purchaser so that Parent and Purchaser can pay for tendered Shares, pay for
Shares exchanged in the Merger and make payments in cancellation of stock
options and stock appreciation rights.
In addition, Parent has agreed that for a period of two years following the
Closing, Parent shall provide employee welfare and pension benefits to Company
employees that are substantially comparable in the aggregate to their current
benefits.
ACQUISITION PROPOSALS. The term "Third Party Acquisition" is used herein to
mean any of the following:
- the acquisition of the Company by anyone other than Parent, Purchaser or
any of their affiliates (a "Third Party").
- the acquisition by a Third Party of any material portion (which shall
include 20% or more) of the assets of the Company and its subsidiaries,
taken as a whole.
- the acquisition by a Third Party who beneficially owns 20% or more of the
Shares as of July 27, 1999 of an additional 5% or more of the Shares or
the acquisition by any other Third Party of 20% or more of the Shares.
The Company has agreed that it will:
- cease any discussions or negotiations with any other persons with respect
to any Third Party Acquisition.
- not encourage, solicit, participate in or initiate discussions or
negotiations with or provide any information to anyone except Parent and
Purchaser concerning any Third Party Acquisition. However, if the Company
Board determines in good faith, after consultation with legal counsel,
that it is necessary to do so in order to comply with its fiduciary
obligations to the Company's stockholders under applicable Delaware law,
the Company may, in response to a proposal or offer for a Third Party
Acquisition that was not solicited and that the Company Board determines,
after consultation with the Company's financial advisor, is from a Third
Party that is capable of consummating a Superior Proposal (as defined
herein) and only for so long as the Company Board so determines that its
actions are likely to lead to a Superior Proposal, (i) furnish information
with respect to the Company to any such person pursuant to a customary
confidentiality agreement so
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long as any information so provided which has not previously been provided
by the Company to Parent will be promptly delivered to Parent, and (ii)
participate in the discussions and negotiations regarding such proposal or
offer.
- promptly notify Parent if the Company or any of its subsidiaries and other
affiliates or any of their respective officers, directors, employees or
agents receives any proposal or inquiry regarding a Third Party
Acquisition.
- provide copies of any written agreements, proposals, or other materials
the Company receives with respect to a Third Party Acquisition.
- advise Parent of the status of any Third Party Acquisition, at any time
upon Parent's request, and from time to time promptly following any
material developments concerning the same.
Except as described below, the Company Board may not withdraw or modify its
recommendation of the Offer or the Merger. It also may not approve or recommend,
or cause or permit the Company to enter into, any agreement or obligation with
respect to any Third Party Acquisition. However, if the Company Board by a
majority vote determines in its good faith judgment, after consultation with and
after receiving the advice of legal counsel, that its fiduciary duties require
it to do so, the Company Board may withdraw its recommendation of the Offer or
the Merger or approve or recommend a Superior Proposal. A "Superior Proposal"
means any BONA FIDE proposal to acquire, directly or indirectly, solely for cash
and/or securities, all of the Shares then outstanding, or all or substantially
all of the Company's assets that:
- is not subject to a financing contingency and contains terms that the
Company Board determines in its good faith judgment, after consultation
with, as to the financial terms, the Company's financial advisor or
another financial advisor of nationally recognized reputation, to be more
favorable to the Company's stockholders than the Offer and Merger;
- the Company Board determines in its good faith judgment (following
consultation with the Company's financial advisor or another financial
advisor of nationally recognized reputation and its legal or other
advisers) to be likely to be completed (taking into account all legal,
financial, regulatory and other aspects of the proposal);
- does not contain a right of first refusal or right of first offer with
respect to any counter-proposal that Purchaser may make; and
- is not subject to satisfactory diligence by the person making the
proposal.
The Company Board may withdraw its recommendation of the Offer or the Merger
or approve or recommend any Superior Proposal only (a) after providing written
notice to Parent advising Parent that the Company Board has received a Superior
Proposal, specifying the material terms and conditions and identifying the
person making the Superior Proposal, and (b) if Parent does not, within 48 hours
of receipt of notice of such Superior Proposal, make an offer that the Company
Board by a majority vote determines in its good faith judgment, after
consultation with the Company's financial advisor or another financial advisor
of nationally recognized reputation, to be at least as favorable to the Company
stockholders as such Superior Proposal. In addition, the Company may enter into
an agreement with respect to such Superior Proposal only if the Merger Agreement
has been terminated in accordance with its terms and the Company has paid any
liquidated damages and has made reimbursement of any fees, costs and expenses
which are payable to Parent under the Merger Agreement (as described below under
"--LIQUIDATED DAMAGES AND EXPENSES").
CONDITIONS TO THE MERGER. The obligation of each of the Company, Parent and
Purchaser to consummate the Merger is subject to the satisfaction of each of the
following conditions:
- the Merger Agreement has been approved and adopted by the requisite vote
of the Company's stockholders, if such vote is required by applicable law.
- no law or order by any United States federal or state court or
governmental authority prohibits, enjoins or restricts the Merger.
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- Purchaser has purchased tendered Shares pursuant to the Offer.
Assurances cannot be given that all of the conditions to completion of the
Merger will be satisfied.
TERMINATION. The Merger Agreement may be terminated and the Merger
abandoned at any time prior to the completion of the Merger, even though the
Company's stockholders may have approved the Merger Agreement and the Merger.
This termination may occur in the following ways:
- Parent, Purchaser and the Company agree to terminate the Merger Agreement
by mutual written consent.
- Either Parent and Purchaser or the Company decide to terminate the Merger
Agreement because:
1. any state or federal court or other governmental authority has issued a
final, non-appealable ruling prohibiting the Merger; or
2. the Merger is not completed by March 31, 2000, unless the failure to
complete the Merger by that date is due principally to the failure of
the party seeking to terminate the Merger Agreement to perform its
obligations under the Merger Agreement.
- The Company decides to terminate the Merger Agreement because:
x. Purchaser fails to commence the Offer in accordance with the Merger
Agreement.
y. Purchaser fails to pay for tendered Shares pursuant to the Offer within
120 days after July 27, 1999, unless such failure to pay is the result
of (a) the failure of the Company to perform any of its covenants and
agreements contained in the Merger Agreement or (b) termination of the
Offer in accordance with the provisions of Annex A to the Merger
Agreement, which provisions are described in "18. Certain Conditions of
the Offer."
z. the Company Board has received a Superior Proposal and has complied
with the provisions of the Merger Agreement requiring the Company,
among other things, to provide notice to Parent, pay certain liquidated
damages and reimburse certain fees, costs and expenses.
- Parent or Purchaser decides to terminate the Merger Agreement if:
a. due to an occurrence or circumstance that would result in a failure to
satisfy any of the conditions set forth in Annex A to the Merger
Agreement, Purchaser has terminated the Offer in accordance with the
provisions of Annex A, which conditions and provisions are described in
"18. Certain Conditions of the Offer."
b. due to an occurrence or circumstance that would result in a failure to
satisfy any of the conditions set forth in Annex A to the Merger
Agreement, Purchaser has failed to pay for tendered Shares pursuant to
the Offer within 120 days after July 27, 1999, unless such failure to
pay for Shares is a result of the failure of Parent or Purchaser to
perform any of its covenants and agreements contained in the Merger
Agreement.
c. the Company has materially breached its obligations with respect to
Third Party Acquisitions described in "--ACQUISITION PROPOSALS" above.
d. the Company Board has recommended to the Company's stockholders a
Superior Proposal.
e. the Company Board has withdrawn or adversely modified (including by
amendment of the Schedule 14D-9) its approval or recommendation of the
Merger Agreement, the Offer or the Merger.
f. the Minimum Condition has not been satisfied by the expiration date of
the Offer and on or prior to such date (a) any person (other than
Parent or Purchaser) has made and not withdrawn a BONA FIDE proposal or
public announcement or commitment to the Company with respect to a
Third Party Acquisition or (b) any person (including the Company or any
of its affiliates or subsidiaries), other than Parent or Purchaser, has
become the beneficial owner of 25% of the Shares.
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EFFECT OF TERMINATION. Even after the Merger Agreement has been terminated,
certain provisions for payment of certain fees and expenses will remain in
effect. Also, termination of the Merger Agreement will not relieve any party
from liability for any breach by it of the Merger Agreement. However, no
representations or warranties made by the Company, Parent or Purchaser will
survive beyond the termination of the Merger Agreement.
LIQUIDATED DAMAGES AND EXPENSES. If any of the following occur (each, a
"Termination Fee Event"):
1. Parent and Purchaser terminate the Merger Agreement because of reasons
(c), (d), (e) or (f) listed above in "--TERMINATION";
2. the Company terminates the Merger Agreement because of reason (z) listed
above in "--TERMINATION"; or
3. the Company terminates the Merger Agreement because of reason (y) listed
above in "--TERMINATION" at a time when Parent and Purchaser had a right
to terminate the Merger Agreement because of reasons (c), (d), (e) or (f)
listed above in "--TERMINATION"
then the Company will pay Parent a fee of $2,500,000 and an additional fee of
$2,500,000 immediately if, within 12 months after such a termination by Parent
and Purchaser, the Company enters into any agreement with respect to a Third
Party Acquisition or consummates a Third Party Acquisition without the entering
into of any such agreement during such period.
In addition, if Parent and Purchaser terminate the Merger Agreement because
of reasons (a) or (b) listed above in "--TERMINATION" in connection with a
willful act or omission by the Company which results in a failure to satisfy any
of the conditions set forth in Annex A of the Merger Agreement, which conditions
are described in "18. Certain Conditions of the Offer," then, the Company shall
pay Parent a fee of $1,000,000 immediately upon such termination. Furthermore,
if Parent and Purchaser terminate the Merger Agreement because of reasons (a) or
(b) listed above in "--TERMINATION" in connection with a willful act or omission
by the Company which results in a failure to satisfy any of the conditions set
forth in Annex A of the Merger Agreement, which conditions are described in "18.
Certain Conditions of the Offer," the Company shall pay Parent a fee of
$5,000,000 if, within 12 months after such a termination by Parent and
Purchaser, the Company enters into any agreement with respect to a Third Party
Acquisition or consummates a Third Party Acquisition without the entering into
of any such agreement during such period. The $5,000,000 fee shall be reduced by
the sum paid, if any, of the $1,000,000 fee payable under the circumstances
described in the first sentence of this paragraph.
The Company, Parent and Purchaser have specifically agreed that the amount
to be paid upon the occurrence of a Termination Fee Event as described above
represents liquidated damages and not a penalty.
The Company is required to reimburse Parent the amount of $500,000 as
reimbursement for the out-of-pocket costs, fees and expenses incurred by any of
them or on their behalf in connection with the Merger Agreement, the Offer, the
Merger and the consummation of the transactions contemplated by the Merger
Agreement (including fees payable to investment bankers, counsel to any of the
foregoing and accountants) upon termination of the Merger Agreement pursuant to:
1. a termination by Parent or Purchaser because of reasons (a) or (b)
listed above in "--TERMINATION";
2. a termination by the Company because of reason (z) listed above in
"--TERMINATION"; or
3. a termination by Parent or Purchaser because of reasons (c), (d), (e) or
(f) listed above in "--TERMINATION."
Parent is required to reimburse the Company the amount of $500,000 as
reimbursement for the out-of-pocket costs, fees and expenses incurred by any of
them or on their behalf in connection with the
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Merger Agreement, the Offer, the Merger and the consummation of the transactions
contemplated by the Merger Agreement (including fees payable to investment
bankers, counsel to any of the foregoing and accountants) upon termination of
the Merger Agreement by the Company because of reasons (x) or (y) listed above
in "--TERMINATION."
Except as described above, whether or not the Merger occurs, the parties to
the Merger Agreement have agreed to pay their own fees and expenses incurred in
connection with the Merger Agreement.
EXTENSION AND WAIVER. At any time prior to the Merger, Parent, Purchaser
and the Company may agree to:
- extend the time for the performance of any of the obligations or other
acts of the other party;
- waive any inaccuracies in the other's representations and warranties; or
- waive the other's compliance with any of the agreements or conditions in
the Merger Agreement.
AMENDMENT. The Merger Agreement may be amended by the parties at any time
before or after the Company's stockholders approve the Merger. However, any such
amendment which by law requires the approval of the Company's stockholders will
require such approval to be effective.
APPRAISAL RIGHTS IN THE MERGER
Each Share held by a stockholder exercising appraisal rights with respect to
such Shares pursuant to the DGCL, who has not effectively withdrawn or lost such
rights, will not be converted into or represent a right to receive the Merger
Consideration, but such stockholder will be entitled only to such rights as are
granted by the DGCL. Specifically, if the Merger is consummated, stockholders of
the Company have certain rights under the DGCL to dissent and demand appraisal
of, and payment in cash of the fair value of, their Shares. In the event that
appraisal rights are available, an objecting stockholder shall cease to have any
rights as a stockholder with respect to the Shares except the right to receive
payment of the fair value thereof. The stockholder's rights may be restored only
upon (i) the withdrawal, with the consent of the Company, of the demand for
payment, (ii) the non-filing of a petition for appraisal within the time
required, (iii) a determination of the court that the stockholder is not
entitled to an appraisal, or (iv) the abandonment or rescission of the Merger.
Each Share held by a stockholder at the Effective Time who will, after the
Effective Time, lose his or her appraisal rights or withdraw such demand for
appraisal or payment of fair market value pursuant to the DGCL, will be deemed
to be converted, as of the Effective Time, into the right to receive the Merger
Consideration. The Company may not voluntarily make any payment with respect to
any demands for appraisal or payment of fair market value or settle or offer to
settle any such demands.
Appraisal rights, if the statutory procedures set forth in Section 262 of
the DGCL are complied with, could lead to a judicial determination of the fair
value (excluding any element of value arising from the accomplishment or
expectation of the Merger) required to be paid in cash to such dissenting
stockholders for their Shares. Any such judicial determination of the fair value
of Shares could be based upon considerations other than or in addition to the
price paid in the Offer and the market value of the Shares, including asset
values and the investment value of the Shares. The value so determined could be
more or less than the purchase price per Share pursuant to the Offer or the
Merger Consideration.
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 THEIR APPRAISAL RIGHTS. THE PRESERVATION AND
EXERCISE OF APPRAISAL RIGHTS ARE CONDITIONED ON STRICT ADHERENCE TO THE
APPLICABLE PROVISIONS OF THE DGCL.
FAILURE TO FOLLOW THE STEPS REQUIRED BY THE DGCL FOR PERFECTING APPRAISAL
RIGHTS MAY RESULT IN THE LOSS OF SUCH RIGHTS.
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VOTING AGREEMENTS
The following is only a summary of certain provisions of the Tender and
Voting Agreement and Irrevocable Proxy (each, a "Voting Agreement," and
collectively, the "Voting Agreements"). Copies of the Voting Agreements have
been filed as exhibits to the Schedule 14D-1. Reference is hereby made to such
exhibits for a more complete description of the terms and conditions of the
Voting Agreements.
TENDER OF SHARES. In connection with the execution of the Merger Agreement,
Parent and Purchaser have entered into Voting Agreements with the following six
directors of the Company (the "Proxy Grantors") who own in the aggregate 751,272
outstanding Shares, representing approximately 8.4% of the issued and
outstanding Shares: (a) R.C. Matney, Chairman of the Board and Chief Executive
Officer of the Company, beneficially owns 701,380 outstanding Shares, (b) David
H. Wedaman, a director and Executive Vice President and Chief Operating Officer
beneficially owns 2,742 outstanding Shares, (c) James T. Graves, a director and
General Counsel of the Company, beneficially owns 10,600 outstanding Shares, (d)
William E. Greenwood, a director of the Company, beneficially owns 9,800
outstanding Shares, (e) Thomas J. Fitzgerald, a director of the Company,
beneficially owns 13,650 outstanding Shares, and (f) Dr. Jay U. Sterling, a
director of the Company, beneficially owns 13,100 outstanding Shares. Pursuant
to the Voting Agreements, upon the terms and subject to the conditions therein,
each Proxy Grantor has agreed, provided the Merger Agreement has not been
terminated, to promptly after the date of commencement of the Offer (but in all
events not later than five business days thereafter) tender to Purchaser
substantially all Shares beneficially owned by such Proxy Grantor.
VOTING OF SHARES. Each Proxy Grantor has also agreed, provided the Merger
Agreement has not been terminated, and subject to the receipt of proper notice
and in the absence of a preliminary injunction or other final order by any court
or other administrative or judicial authority barring such action, to vote the
Shares beneficially owned by such Proxy Grantor in accordance with the Voting
Agreement, including (i) in favor of approval of the Merger Agreement, the
transactions contemplated by the Merger Agreement, and any actions required in
furtherance thereof and hereof (including the election of designees of Parent as
directors of the Company); (ii) against any action or agreement that would
result in a breach in any respect of any covenant, representation or warranty or
any other obligation or agreement of the Company under the Merger Agreement; and
(iii) except as otherwise agreed to in writing in advance by Parent, against:
(A) any Third Party Acquisition, (B) any change in a majority of the individuals
who, as of July 27, 1999, constitute the Company Board (other than as
contemplated by the Merger Agreement), (C) any extraordinary corporate
transaction, such as a merger, consolidation or other business combination
involving the Company or any of its subsidiaries and any third party, (D) a
sale, lease, transfer or disposition of any assets of the Company's or any of
its subsidiaries' business outside the ordinary course of business, (E) any
change in the present capitalization of the Company or any amendment of the
Company's Certificate of Incorporation or bylaws, (F) any other material change
in the Company's corporate structure or affecting its business, or (G) any other
action which is intended, or could reasonably be expected, to impede, interfere
with, delay, postpone or materially adversely affect the Offer, the Merger or
any of the other transactions contemplated by the Merger Agreement, or the
Voting Agreement.
IRREVOCABLE PROXY. Each Proxy Grantor has also, provided the Merger
Agreement has not been terminated, appointed Purchaser and certain designees of
Purchaser, in their respective capacities as designees of Purchaser, as such
Proxy Grantor's true and lawful irrevocable (until the Termination Date) proxy
and attorney-in-fact to vote all outstanding Shares beneficially owned by such
Proxy Grantor at any Stockholders' Meeting called for purposes of considering
whether to approve the Merger Agreement, the Merger or any of the other
transactions contemplated by the Merger Agreement, or any Third Party
Acquisition, or to execute a written consent of stockholders in lieu of any such
meeting.
PURCHASE OPTION. Each Proxy Grantor granted to Parent and Purchaser an
irrevocable option (the "Purchase Option") to purchase for cash, in a manner set
forth below, any or all of the Shares (and including Shares acquired after July
27, 1999 by such Proxy Grantor) beneficially owned by the Proxy
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Grantor at a price (the "Exercise Price") per Share equal to $23.00. In the
event of any stock dividends, stock splits, recapitalizations, combinations,
exchanges of Shares or similar events, the Exercise Price will be appropriately
adjusted for this purpose. The Voting Agreements provide that subject to the
conditions set forth below, the Purchase Option may be exercised by Parent or
Purchaser, in whole or in part, at any time or from time to time after the
occurrence of any Trigger Event (as defined below).
A "Trigger Event" means any one of the following: (i) the Merger Agreement
becomes terminable under circumstances that entitle Parent or Purchaser to
receive the liquidated damages or the fees and expenses under the Merger
Agreement (regardless of whether the Merger Agreement is actually terminated and
whether such liquidated damages or fees and expenses are then actually paid),
(ii) the Offer is consummated but, due to the failure of the Proxy Grantor to
validly tender and not withdraw all of the then outstanding Shares beneficially
owned by such Proxy Grantor, Purchaser has not accepted for payment or paid for
all of such Shares, (iii) a tender or exchange offer for at least 10% of the
Shares shall have been publicly proposed to be made or shall have been made by
another person, or (iv) it shall have been publicly disclosed or Parent or
Purchaser shall have otherwise learned that (A) any person or "group" (as
defined in Section 13(d)(3) of the Exchange Act) (other than Parent or
Purchaser) shall have acquired or proposed to acquire beneficial ownership of
more than 10% of any class or series of capital stock of the Company (including
Shares), through the acquisition of stock, the formation of a group or
otherwise, or shall have been granted any option, right or warrant, conditional
or otherwise, to acquire beneficial ownership of more than 10% of any class or
series of capital stock of the Company or any of its subsidiaries, or (B) any
person or group (other than Parent and Purchaser) shall have entered into or
publicly offered to enter into a definitive agreement or an agreement in
principle with respect to a merger, consolidation or other business combination
with the Company or any of its subsidiaries.
Pursuant to the Voting Agreements, if requested by Parent and Purchaser in
the Exercise Notice, such Proxy Grantor will exercise all Options (to the extent
exercisable) and other rights (including conversion or exchange rights)
beneficially owned by such Proxy Grantor and will sell or, if directed by Parent
and Purchaser, tender the Shares acquired pursuant to such exercise to Parent or
Purchaser as provided in the Voting Agreements. The Purchase Option will
terminate (a) as it relates to a Proxy Grantor, upon purchase by Parent or
Purchaser of the Shares owned by such Proxy Grantor pursuant to the Offer or (b)
upon the earliest of: (i) termination of the Merger Agreement other than upon,
during the continuance of or after a Trigger Event; or (ii) 90 days following
any termination of the Merger Agreement upon, during the continuance of or after
a Trigger Event (or if, at the expiration of such 90 day period the Purchase
Option cannot be exercised by reason of any applicable judgment, decree, order,
injunction, law or regulation, ten business days after such impediment to
exercise has been removed or has become final and not subject to appeal).
Under the Voting Agreements, the obligation of each Proxy Grantor to sell
such Proxy Grantor's Shares to Parent or Purchaser is subject to the conditions
that (i) all waiting periods, if any, under the HSR Act, applicable to the sale
of the Shares or the acquisition of the Shares by Parent or Purchaser, as the
case may be, hereunder have expired or have been terminated; (ii) all consents,
approvals, orders or authorizations of, or registrations, declarations or
filings with, any court, administrative agency or other Governmental Entity, if
any, required in connection with sale of the Shares or the acquisition of the
Shares by Parent or Purchaser hereunder have been obtained or made; and (iii) no
preliminary or permanent injunction or other order by any court of competent
jurisdiction prohibiting or otherwise restraining such sale or acquisition is in
effect. Under the Voting Agreements, the Company has agreed to provide Parent
and Purchaser certain registration rights with respect to the Shares purchased
pursuant to the Purchase Option.
RESTRICTION ON TRANSFER, PROXIES AND NON-INTERFERENCE. Each Proxy Grantor
has agreed not to, directly or indirectly except as contemplated by the Voting
Agreements: (i) offer for sale, sell, transfer, tender, pledge, encumber, assign
or otherwise dispose of, or enter into any contract, option or other arrangement
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or understanding with respect to or consent to the offer for sale, sale,
transfer, tender, pledge, encumbrance, assignment or other disposition of, any
or all of such Proxy Grantor's Shares or any interest therein; (ii) grant any
proxies or powers of attorney, deposit any Shares into a voting trust or enter
into a voting agreement with respect to any Shares; or (iii) take any action
that would make any representation or warranty made by such Proxy Grantor untrue
or incorrect or have the effect of preventing or disabling such Proxy Grantor
from performing such Proxy Grantor's obligations under the applicable Voting
Agreement.
OTHER POTENTIAL ACQUIRORS. Each Proxy Grantor (i) is required to
immediately cease any existing discussions or negotiations with any parties with
respect to any acquisition of all or any material portion of the assets of, or
any equity interest in, the Company or any of its subsidiaries or any business
combination with the Company or any of its subsidiaries, in his, her or its
capacity as such; (ii) has agreed, from and after the date of the Voting
Agreements until termination of the Merger Agreement, in such capacity, directly
or indirectly, not to initiate, solicit or knowingly encourage (including by way
of furnishing non-public information or assistance), or take any other action to
facilitate knowingly, any inquiries or the making of any Third Party
Acquisition; and (iii) has agreed to promptly notify Parent of any proposals
for, or inquiries with respect to, a potential Third Party Acquisition received
by the Proxy Grantor or of which such Proxy Grantor otherwise has knowledge.
REPRESENTATIONS AND WARRANTIES. The Voting Agreements contain certain
customary representations and warranties of the parties thereto, including,
without limitation, representations and warranties by the Proxy Grantors as to
ownership of Shares and power and authority.
TERMINATION. Generally, the Voting Agreements expire upon the earliest of
(a) the date on which the Merger Agreement terminates in accordance with its
terms, (b) the date on which Purchaser accepts tendered Shares for payment, and
(c) July 31, 2000.
STOCK PURCHASE AND STOCKHOLDER AGREEMENTS
Each of R.C. Matney and David H. Wedaman (the "Investors") has agreed to
enter into a stock purchase and stockholder agreement with Ocean Group (the
"Stock Agreement") pursuant to which the Investors agree to invest an aggregate
of approximately $2.2 million in Ocean Group ordinary shares, following
consummation of the Merger, and generally not dispose of the shares so acquired
for a period of four years from the Closing Date. If certain annual performance
targets are achieved, however, the Investors may dispose of up to 25% of such
shares per year following the achievement of such targets in each of the first
four fiscal years ending after the Closing Date. Copies of the Stock Agreements
have been filed as exhibits to the Schedule 14 D-1. Reference is hereby made to
such exhibits for a more complete description of the terms and conditions of the
Stock Agreements.
14. INTERESTS OF CERTAIN PERSONS IN THE MERGER
INDEMNIFICATION; DIRECTORS' AND OFFICERS' INSURANCE. Pursuant to the Merger
Agreement, the Surviving Corporation (or any successor) will, to the fullest
extent permitted by law indemnify the present and former officers and directors,
as well as persons who become officers and directors prior to the Effective
Time, of the Company and its subsidiaries who suffer liabilities or losses from
any threatened or actual claim or proceeding based on the fact that the person
is or was a director or officer of the Company or any of its subsidiaries or
based on the Merger Agreement.
The Merger Agreement further provides that Parent will cause the Surviving
Corporation to fulfill the obligations of the Company pursuant to any
indemnification agreements between the Company and its directors and officers as
of or prior to July 27, 1999, and to keep in effect any indemnification
provisions under the Company's certificate of incorporation or bylaws as in
effect immediately prior to the Effective Time.
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For a period of six years after the Effective Time, Parent will maintain or
cause the Surviving Corporation to maintain in effect, at no expense to the
beneficiaries, directors' and officers' liability insurance covering those
persons who, as of immediately prior to the Effective Time, are covered by the
Company's directors' and officers' liability insurance policy (the "Insured
Parties") on terms no less favorable to the Insured Parties than those of the
Company's current directors' and officers' liability insurance policy. However,
in no event will Parent or the Company be required to expend on an annual basis
in excess of 150% of the annual premium currently paid by the Company for such
coverage (the "Maximum Premium"). If the Surviving Corporation is unable to
obtain this insurance for the Maximum Premium, it will obtain as much comparable
insurance as possible for an annual premium equal to the Maximum Premium.
Instead of maintaining such existing insurance, Parent, at its election, may
cause coverage to be provided under any policy maintained for the benefit of
Parent or any of its subsidiaries, so long as the terms are not materially less
advantageous to the intended beneficiaries thereof than such existing insurance.
In the event any claim is made against present or former directors, officers or
employees of the Company that is covered or potentially covered by insurance,
neither the Surviving Corporation nor Parent shall do anything that would
forfeit, jeopardize, restrict or limit the insurance coverage available for that
claim until final disposition thereof.
The Merger Agreement provides that, if any claim, action, suit, proceeding
or investigation (whether arising before, at or after the Effective Time) is
made against any Indemnified Persons within six years of the Effective Time, the
indemnification provisions of the Merger Agreement will continue in effect until
the final disposition of such claim, action, suit, proceeding or investigation.
In the event that the Surviving Corporation or Parent or any of their
respective successor or assigns (i) consolidates with or merges into any other
person and shall not be the continuing or surviving corporation or entity of
such consolidation or merger or (ii) transfers or conveys all or substantially
all of its properties and assets to any person, then, and in each such case,
proper provision will be made so that the successors and assigns of the
Surviving Corporation or Parent will succeed to the obligations with respect to
indemnification and directors' and officers' insurance imposed by the Merger
Agreement.
15. GOING PRIVATE TRANSACTIONS
The Merger must comply with any applicable federal law operating at the time
of its consummation. Rule 13e-3 under the Exchange Act is applicable to certain
"going private" transactions. Purchaser does not believe that Rule 13e-3 will be
applicable to the Merger unless the Merger is consummated more than one year
after the Offer. If applicable, Rule 13e-3 requires, among other things, that
certain financial information concerning the Company and certain information
relating to the fairness of the Merger and the consideration offered to minority
stockholders be filed with the Commission and disclosed to minority stockholders
prior to the consummation of the Merger.
16. DIVIDENDS AND DISTRIBUTIONS
According to the Company's 1998 Annual Report on Form 10-K, the Company has
not paid cash dividends since its initial public offering and intends to retain
any future earnings for use in its business. Pursuant to the terms of the Merger
Agreement, the Company is not permitted, without the prior written consent of
Parent, to split, combine or reclassify the outstanding Shares or declare, set
aside or pay any dividend payable in cash, stock or property with respect to the
Shares, or redeem or otherwise acquire any of the Shares or any securities of
any of its subsidiaries.
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17. EFFECTS OF THE OFFER ON THE MARKET FOR SHARES; NASDAQ NATIONAL MARKET;
EXCHANGE ACT REGISTRATION
POSSIBLE EFFECTS OF THE OFFER ON THE MARKET FOR THE SHARES
The purchase of Shares by Purchaser pursuant to the Offer will reduce the
number of Shares that might otherwise trade publicly and the number of holders
of Shares, and could thereby adversely affect the liquidity and market value of
the remaining publicly held Shares. It is expected that, following the Offer, a
large percentage of the Shares will be owned by Purchaser. Purchaser cannot
predict whether the reduction in the number of Shares that might otherwise trade
publicly would have an adverse or beneficial effect on the market price for or
marketability of the Shares or whether it would cause future market prices to be
greater or less than the Offer Price therefor.
STOCK QUOTATION
Depending upon the number of Shares purchased pursuant to the offer, the
Shares may no longer meet the requirements of the National Association of
Securities Dealers, Inc. (the "NASD") for continued inclusion on the Nasdaq
National Market. The maintenance for continued inclusion requires the Company to
substantially meet one of two maintenance standards. The Company must have
either (a) (i) at least 750,000 publicly held shares, (ii) at least 400
stockholders of round lots, (iii) a market value of at least $5 million, (iv) a
minimum bid price per Share of $1.00, (v) at least two registered and active
market makers for its Shares and (vi) net tangible assets of at least $4
million; or (b) (i) at least 1,100,000 publicly held shares, (ii) at least 400
stockholders of round lots, (iii) a market value of at least $15 million, and
(iv) either (x) a market capitalization of at least $50 million or (y) total
assets and total revenue of at least $50 million, in its most recently completed
fiscal year or two of its last three most recently completed fiscal years, (v) a
minimum bid price per Share of $5.00 and (vi) at least four registered and
active market makers. Shares held directly or indirectly by directors, officers
or beneficial owners or more than 10% of the Shares are not considered as being
publicly held for this purpose.
If, as a result of the purchase of Shares pursuant to the Offer or
otherwise, the Shares no longer meet the requirements of the NASD for continued
inclusion in the Nasdaq National Market or in any other tier of the Nasdaq Stock
Market, and the Shares are, in fact, no longer included in the Nasdaq National
Market or in any other tier of the Nasdaq Stock Market, the market for Shares
could be adversely affected.
In the event that the Shares no longer meet the requirements of the NASD for
continued inclusion in any tier of the Nasdaq Stock Market, it may be possible
that the Shares would continue to trade in the over-the-counter market and that
price quotations would be reported by other sources. The extent of the public
market for the Shares and the availability of such quotations would, however,
depend upon the number of holders of Shares remaining at such time, the interest
in maintaining a market in 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.
EXCHANGE ACT REGISTRATION
The Shares are currently registered under the Exchange Act. Registration
under the Exchange Act may be terminated upon application by the Company to the
Commission if the Shares are not listed on a national securities exchange and
there are fewer than 300 record holders. Termination of the Exchange Act
registration of the Shares would substantially reduce the information required
to be furnished by the Company to holders of Shares and to the Commission and
would make certain provisions of the Exchange Act, such as the short-swing
profit recovery provisions of Section 16(b), the requirements of furnishing a
proxy statement in connection with stockholders' meetings and the requirements
of Rule 13e-3 under the Exchange Act with respect to "going private"
transactions, no longer applicable to the Shares. In addition, "affiliates" of
the Company and persons holding "restricted securities" of the Company may be
deprived of the ability to dispose of such securities pursuant to Rule 144
promulgated under the Securities Act. If
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registration of the Shares under the Exchange Act were terminated, the Shares
would no longer be "margin securities" or be eligible for Nasdaq Stock Market
reporting. Parent currently intends to seek to cause the Company to terminate
the registration of the Shares under the Exchange Act as soon after consummation
of the Offer as the requirements for termination of registration are met.
MARGIN REGULATIONS
The Shares are currently "margin securities" under the regulations of the
Board of Governors of the Federal Reserve System (the "Federal Reserve Board"),
which has the effect, among other things, of allowing brokers to extend credit
on the collateral of such Shares for the purpose of buying, carrying or trading
in securities ("Purpose Loans"). Depending upon factors similar to those
described above regarding the continued listing, public trading and market
quotations of the Shares, it is possible that, following the purchase of the
Shares pursuant to the Offer, the Shares would no longer constitute "margin
securities" for the purposes of the margin regulations of the Federal Reserve
Board and therefore could no longer be used as collateral for Purpose Loans made
by brokers.
18. CERTAIN CONDITIONS OF THE OFFER
Notwithstanding any other provision of the Offer or the Merger Agreement,
and subject to any applicable rules and regulations of the Commission, including
Rule 14e-1(c) relating to Purchaser's obligation to pay for or return tendered
Shares promptly after termination of the Offer, Purchaser will not be required
to accept for payment or pay for any Shares, may delay the acceptance for
payment of any Shares pursuant to Section 1.1(b) of the Merger Agreement, may
extend the Offer one or more times, and may terminate the Offer at any time
after March 31, 2000 if (a) the Minimum Condition is not satisfied by the
Expiration Date, (b) any applicable waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976 ("the HSR Act") has not expired or
terminated, (c) approval of all necessary government officials and agencies
shall not have been obtained on terms and conditions reasonably satisfactory to
Parent, or (d) at any time after July 27, 1999 and before acceptance for payment
of any Shares, any of the following events has occurred and is continuing:
(a) (1) there shall have been any action taken, or any statute, rule,
regulation, judgment, order or injunction promulgated, entered, enforced,
enacted, issued or deemed applicable to the Offer or the Merger by any
domestic or foreign court or other governmental agency which directly or
indirectly prohibits or makes illegal the acceptance of payment for or
purchase of Shares or the consummation of the Offer or the Merger or the
other transactions contemplated by the Merger Agreement, renders Purchaser
unable to accept for payment, pay for or purchase some or all of the Shares,
imposes material limitations on the ability of Parent effectively to
exercise full rights of ownership of the Shares, including the right to vote
the Shares purchased by it on all matters properly presented to the
Company's stockholders, or otherwise has a Material Adverse Effect (as
defined in the Merger Agreement) on the Company, or (2) in connection with
the compliance by Parent and Purchaser with any applicable law or obtaining
any requisite consent, Parent will be required to sell or divest any assets
or business or prohibited from owning any material portion of the Company's
business or assets;
(b) (i) the representations and warranties of the Company contained in
the Merger Agreement as of July 27, 1999 and as of the consummation of the
Offer with the same effect as if made at and as of the consummation of the
Offer (except as to any such representation or warranty which speaks as of a
specific date) are not true and correct in any respect that is reasonably
likely to have a Material Adverse Effect (or if such representations and
warranties are qualified by reference to materiality or a Material Adverse
Effect, are not true and correct), (ii) the Company shall have failed to
perform in all material respects its covenants or agreements contained in
the Merger Agreement which would have a Material Adverse Effect on the
Company or materially adversely affect (or materially delay) the ability of
Purchaser to consummate the Offer or of Parent, Purchaser or the Company to
consummate
36
<PAGE>
the Merger, and the Company has not cured such breach within five business
days after notice by Parent or Purchaser of such breach, or (iii) there has
occurred since January 2, 1999 any events or changes which constitute a
Material Adverse Effect on the Company;
(c) it shall have been publicly disclosed or Parent shall have otherwise
learned that (i) any person or "group" (as defined in Section 13(d)(3) of
the Exchange Act) shall have acquired or entered into a definitive agreement
or agreement in principle to acquire beneficial ownership of more than 35%
of the Shares or any other class of capital stock of the Company, through
the acquisition of stock, the formation of a group or otherwise, or has been
granted any option, right or warrant, conditional or otherwise, to acquire
beneficial ownership of more than 35% of the Shares, and (ii) such person or
group has not tendered such Shares pursuant to the Offer;
(d) the Company Board has withdrawn, modified or changed in a manner
adverse to Parent (including by amendment of the Schedule 14D-9) its
recommendation of the Offer, the Merger Agreement, or the Merger, or
recommended another proposal or offer, or the Company Board has resolved to
do any of the foregoing;
(e) the Merger Agreement has been terminated in accordance with its
terms; or
(f) there has occurred (i) any general suspension of trading in, or
limitation on prices for, securities on the New York Stock Exchange or the
Nasdaq National Market, for a period in excess of 24 hours, (ii) the
commencement of a war, armed hostilities or other national or international
calamity directly or indirectly involving the United States that constitutes
a Material Adverse Effect on the Company or materially adversely affects or
delays the consummation of the Offer, (iii) the average of the closing
prices of the Standard & Poor's 500 Index for any 20 consecutive trading
days shall be 25% or more below the closing price of such index on any
trading day on or after the date hereof that precedes the commencement of
such 20-trading day period, or (iv) in the case of any of the foregoing
existing at the time of the commencement of the Offer, a material
acceleration or worsening thereof;
which in the good faith judgment of Parent, in any such case and regardless of
the circumstances giving rise to such condition, makes it inadvisable to proceed
with the Offer or the acceptance for payment of tendered Shares.
The foregoing conditions, other than the Minimum Condition, are for the
benefit of Parent and Purchaser and may be waived by Parent and Purchaser, in
whole or in part at any time and from time to time in the sole discretion of
Parent and Purchaser. The failure by Parent or Purchaser at any time to exercise
any of the foregoing rights shall not be deemed a waiver of any such right and
each such right shall be deemed an ongoing right which may be asserted at any
time and from time to time.
19. CERTAIN LEGAL MATTERS; REGULATORY APPROVALS
GENERAL
Except as described below, neither Parent nor Purchaser is aware of any
license or 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 acquisition of Shares pursuant to the Offer, or of any approval or other
action by any governmental, administrative or regulatory agency or authority or
public body, domestic or foreign, that would be required for the acquisition or
ownership of Shares pursuant to the Offer. Should any such approval or other
action be required, it is presently contemplated that such approval or action
would be sought except as described below in this Section under "State Takeover
Statutes." While, except as otherwise expressly described herein, Purchaser does
not currently intend to delay acceptance for payment of Shares tendered pursuant
to the Offer pending the outcome of any such matter, there can be no assurance
that any such approval or other action, if needed, would be obtained without
substantial conditions or that adverse consequences might not result to the
Company's business or that certain parts of
37
<PAGE>
the Company's business might not have to be disposed of in the event that such
approvals were not obtained or such other actions were not taken or in order to
obtain any such approval or other action, any of which could cause Purchaser to
decline to accept for payment or pay for any Shares tendered. Purchaser's
obligation under the Offer to accept for payment and pay for Shares is subject
to the Offer Conditions, including conditions relating to legal matters
discussed in this Section 19.
ANTITRUST
Under the HSR Act and the rules that have been promulgated thereunder by the
Federal Trade Commission ("FTC"), certain acquisition transactions may not be
consummated unless certain information has been furnished to the Antitrust
Division of the Department of Justice (the "Antitrust Division") and the FTC and
certain waiting period requirements have been satisfied. The acquisition of
Shares pursuant to the Offer is subject to these requirements.
Parent expects to file a Notification and Report Form with respect to the
Offer under the HSR Act as soon as practicable following commencement of the
Offer. The waiting period under the HSR Act with respect to the Offer will
expire at 11:59 p.m., Washington D.C. time, on the 15th day after the date such
form is filed, unless early termination of the waiting period is granted. In
addition, the Antitrust Division or the FTC may extend such waiting period by
requesting additional information or documentary material from Parent. If such a
request is made with respect to the Offer, the waiting period related to the
Offer will expire at 11:59 p.m., Washington D.C. time, on the tenth day after
substantial compliance by Parent with such request. With respect to each
acquisition, the Antitrust Division or the FTC may issue only one request for
additional information. In practice, complying with a request for additional
information or material can take a significant amount of time. In addition, if
the Antitrust Division or the FTC raises substantive issues in connection with a
proposed transaction, the parties may engage in negotiations with the relevant
governmental agency concerning possible means of addressing those issues and may
agree to delay consummation of the transaction while such negotiations continue.
Expiration or termination of applicable waiting periods under the HSR Act is a
condition to Purchaser's obligation to accept for payment and pay for Shares
tendered pursuant to the Offer.
The Antitrust Division and the FTC frequently scrutinize the legality under
the antitrust laws of transactions such as the proposed purchase of the Shares
pursuant to the Offer. At any time before or after such purchase, the Antitrust
Division or the FTC could take such action under the antitrust laws as it deems
necessary or desirable in the public interest, including seeking to enjoin the
transaction or seeking divestiture of the Shares so acquired or divestiture of
substantial assets of Parent or the Company. Litigation seeking similar relief
could be brought by private parties.
Parent and Purchaser does not believe that consummation of the Offer and the
other transactions contemplated by the Merger Agreement will result in the
violation of any applicable antitrust laws. However, there can be no assurance
that a challenge to the Offer and the other transactions contemplated by the
Merger Agreement on antitrust grounds will not be made, or if such a challenge
is made, what the result will be. See "18. Certain Conditions of the Offer" for
certain conditions to the purchase of the
Shares pursuant to the Offer, including conditions with respect to litigation
and certain governmental actions.
STATE TAKEOVER STATUTES
The Company is incorporated under the laws of the State of Delaware. In
general, Section 203 of the DGCL prevents an "interested stockholder"
(generally, a person who owns or has the right to acquire 10% 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
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
38
<PAGE>
business combination or the transaction in which the interested director became
an interested stockholder. Neither Parent nor Purchaser is an interested
stockholder and the Company Board has approved both the Offer and the Merger.
Accordingly, Section 203 is inapplicable to the Offer and the Merger.
In addition, several decisions by Delaware courts have held that, in certain
instances, a controlling stockholder of a corporation involved in a merger has a
fiduciary duty to the other stockholders that requires the merger to be fair to
such other stockholders. In determining whether a merger is fair to minority
stockholders, the Delaware courts have considered, among other things, the type
and amount of consideration to be received by the stockholders and whether there
were fair dealings among the parties. The Delaware Supreme Court has indicated
in recent decisions that in most cases the remedy available in a merger that is
found not to be "fair" to minority stockholders is the right to appraisal
described above or a damages remedy based on essentially the same principles.
A number of states have adopted "takeover" statutes that purport to apply to
attempts to acquire corporations that are incorporated in such states, or whose
business operations have substantial economic effects in such states, or which
have substantial assets, security holders, employees, principal executive
offices or places of business in such states.
In EDGAR V. MITE CORPORATION, the Supreme Court of the United States
invalidated on constitutional grounds the Illinois Business Takeover Act, which,
as a matter of state securities law, made takeovers of corporations meeting
certain requirements more difficult. However, in CTS CORP. V. DYNAMICS CORP. OF
AMERICA, the Supreme Court held that a state may, as a matter of corporate law
and, in particular, those laws concerning corporate governance, constitutionally
disqualify a potential acquirer from voting on the affairs of a target
corporation without prior approval of the remaining stockholders, provided that
such laws were applicable only under certain conditions, in particular, that the
corporation has a substantial number of stockholders in the state and is
incorporated there.
Based on information supplied by the Company, Parent and Purchaser do not
believe that any state takeover statutes (other than Section 203 of the DGCL)
purport to apply to the Offer or the Merger. Neither Parent nor Purchaser has
currently complied with any other state takeover statute or regulation. Parent
and Purchaser reserve the right to challenge the applicability or validity of
any other state law purportedly applicable to the Offer or the Merger and
nothing in this Offer to Purchase or any action taken in connection with the
Offer or the Merger is intended as a waiver of such right. If it is asserted
that any other state takeover statute is applicable to the Offer or the Merger
and if an appropriate court does not determine that it is inapplicable or
invalid as applied to the Offer or the Merger, Parent and Purchaser might be
required to file certain information with, or to receive approvals from, the
relevant state authorities, and Purchaser might be unable to accept for payment
or pay for Shares tendered pursuant to the Offer, or be delayed in consummating
the Offer or the Merger. In such case, Purchaser may not be obliged to accept
for payment or pay for any Shares tendered pursuant to the Offer.
20. FEES AND EXPENSES
Merrill Lynch is acting as Dealer Manager in connection with the Offer and
is providing certain financial advisory services to Ocean Group in connection
with the Offer. Ocean Group has agreed to pay Merrill Lynch fees in the
aggregate amount of $2.0 million for such services, $300,000 of which became
payable upon execution of the Merger Agreement. Ocean Group has agreed to pay
the remaining amount upon consummation of the Offer. Parent and Purchaser have
also agreed to reimburse Merrill Lynch for its out-of-pocket expenses, including
the reasonable fees and expenses of its counsel, and to indemnify Merrill Lynch
and certain related persons against certain liabilities and expenses, including
certain liabilities and expenses under the federal securities laws. Parent has
retained Georgeson Shareholder Communications Inc. to act as the Information
Agent and BankBoston, N.A. to serve as the Depositary in connection with the
Offer. The Information Agent and the Depositary each will receive reasonable and
customary compensation for their services and be reimbursed for certain
reasonable out-of-pocket
39
<PAGE>
expenses. Parent has also agreed to indemnify the Information Agent and the
Depositary against certain liabilities and expenses in connection with the
Offer, including certain liabilities under the federal securities laws.
Parent will not pay any fees or commissions to any broker or dealer or any
other person for soliciting tenders of Shares pursuant to the Offer (other than
to the Information Agent and the Dealer Manager). Brokers, dealers, commercial
banks, trust companies and other nominees will, upon request, be reimbursed by
Parent for customary mailing and handling expenses incurred by them in
forwarding offering materials to their customers.
21. MISCELLANEOUS
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 Purchaser becomes aware of any valid state statute prohibiting the
making of the Offer or the acceptance of the Shares pursuant thereto, Purchaser
will make a good faith effort to comply with such statute or seek to have such
statute declared inapplicable to the Offer. If, after such good faith effort,
Purchaser cannot comply with such state statute, the Offer will not be made to
(nor will tenders be accepted from or on behalf of) 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 Purchaser by the Dealer Manager or one or more
registered brokers or dealers which are licensed under the laws of such
jurisdiction.
Except for the Depositary's authorization to enter into agreements or
arrangements with the Book-Entry Transfer Facility, no person has been
authorized to give any information or to make any representation on behalf of
Ocean Group, Parent or Purchaser not contained herein or in the Letter of
Transmittal and, if given or made, such information or representation must not
be relied upon as having been authorized by Ocean Group, Parent or Purchaser.
Neither the delivery of this Offer to Purchase nor any purchase pursuant to the
Offer shall, under any circumstances, create any implication that there has been
no change in the affairs of the Company, Ocean Group, Parent or Purchaser since
the date as of which information is furnished or the date of this Offer to
Purchase.
Ocean Group, Parent or Purchaser have filed with the Commission a Tender
Offer Statement on Schedule 14D-l, together with exhibits, pursuant to Rule 14-3
under the Exchange Act, furnishing certain additional information with respect
to the Offer. In addition, the Company has filed with the Commission a
Solicitation/Recommendation Statement on Schedule 14D-9, together with exhibits,
pursuant to Rule 14d-9 under the Exchange Act, setting forth the recommendations
of the Company Board with respect to the Offer and the reasons for such
recommendations and furnishing certain additional related information. Such
Schedules and any amendments thereto, including exhibits, may be inspected and
copies may be obtained from the Commission in the manner set forth in Section 7
of this Offer to Purchase (except that they will not be available at the
regional offices of the Commission).
MSAS ACQUISITION CORPORATION
July 29, 1999
40
<PAGE>
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS OF OCEAN GROUP PLC,
MSAS GLOBAL LOGISTICS INC. AND MSAS ACQUISITION CORPORATION
The following table sets forth the name, age, business or residence address,
citizenship, principal occupation or employment at the present time and during
the last five years, and the name of any corporation or other organization in
which such employment is conducted or was conducted of each executive officer or
director of Ocean Group. Except as otherwise indicated, all of the persons
listed below are citizens of the United States of America. Each occupation set
forth opposite a person's name, unless otherwise indicated, refers to employment
with Ocean Group. Unless otherwise indicated, the principal business address of
each director or executive officer is Ocean Group plc, Ocean House, The Ring,
Bracknell, Berkshire RG12 1AW, United Kingdom.
<TABLE>
<CAPTION>
NAME, AGE, CITIZENSHIP AND PRESENT OCCUPATION OR OTHER MATERIAL POSITIONS
CURRENT BUSINESS ADDRESS EMPLOYMENT HELD DURING THE PAST FIVE YEARS
- ------------------------------------ ------------------------------------ ------------------------------------
<S> <C> <C>
Nigel Sutherland Mervyn Rich, 53 Chairman and Director Group Chief Executive--Trafalgar
British citizenship House plc from 1984 to 1986; Non-
Sutherland Corporate Services Executive Director--Granada Group
7 Lower Sloane Street plc since 1998; Chairman--Hamptons
London SW1W 8AY Group Limited since 1997
United Kingdom
John Murray Allan, 50 Chief Executive Non-Executive Director--Wolseley plc
British citizenship since 1999; Non-Executive Director--
Hamleys plc since 1996;
Director--BET plc from 1987 to 1994
John Bernard Coghlan, 41 Finance Director Director Financial Services of
Irish citizenship Tomkins plc from 1987 to 1995
David Ellison Riddle, 53 Director; Chief Executive of Marine None
British citizenship & Environmental Services and Cory
Cory Environmental Limited Environmental Limited
25 Wellington Street
London WC2E 7DA
United Kingdom
Sir John Ralph Sidney Guinness, 63 Non-Executive Director Chairman--British Nuclear Fuels plc
British citizenship since 1992
British Nuclear Fuels plc
65 Buckingham Gate
London SW1E 6AP
United Kingdom
Anthony Eric Isaac, 57 Non-Executive Director; Non-Executive Director--Hogg
British citizenship Group Finance Director-- Robinson plc since 1996; Group
The BOC Group plc The BOC Group plc Finance Director--Arjo Wiggins
Chertsey Road Appleton plc from 1990 to 1994
Windlesham
Surrey GU20 6HJ
United Kingdom
John Loudon, 63 Non-Executive Director Non-Executive Director--XL Capital
Dutch citizenship Ltd. since 1992; Non-Executive
39 Ovington Street Director--Heineken NV since 1978;
London SW3 2JA Non-Executive Director--SHV Holdings
United Kingdom NV since 1978; Director--Brockbank
Group plc since 1999; Non-Executive
Director--Hiscox plc from 1997 to
1999; Non-Executive Director--Alex
Brown & Sons Holdings Ltd. from 1993
to 1996; Non-Executive
Director--Alex Brown & Sons
Investments Ltd. from 1988 to 1996.
</TABLE>
<PAGE>
The following table sets forth the name, age, business or residence address,
citizenship, principal occupation or employment at the present time and during
the last five years, and the name of any corporation or other organization in
which such employment is conducted or was conducted of each executive officer or
director of Parent. Except as otherwise indicated, all of the persons listed
below are citizens of the United States of America. Each occupation set forth
opposite a person's name, unless otherwise indicated, refers to employment with
Parent. Unless otherwise indicated, the principal business address of each
director or executive officer is Parent, 4120 Point Eden Way, Suite 200,
Hayward, California 94545.
<TABLE>
<CAPTION>
NAME, AGE, CITIZENSHIP AND PRESENT OCCUPATION OR OTHER MATERIAL POSITIONS HELD
CURRENT BUSINESS ADDRESS EMPLOYMENT DURING THE PAST FIVE YEARS
- ------------------------------------ ------------------------------------ ------------------------------------
<S> <C> <C>
Michael Peter Fountain, 45 Director, President, Chief Executive None
British citizenship Officer, Chief Operating Officer and
Regional Chief Executive Americas
Pacific Region
Bruce Schiller, 47 Director and Vice President/General None
MSAS Global Logistics Inc. Manager Fashion Logistics and
10205 N.W. 19th Street, Customs Brokerage
Suite 101
Miami, Florida 33172
Timothy Charles Jones, 35 Director and Vice President Finance Finance Director--Cory Environmental
British citizenship Americas Pacific Region Limited from 1995 to 1998; Deputy
Group Financial Controller--Ocean
Group during 1995
Randy Briggs, 39 Director and Vice President/General None
Manager United States Region
Ralph R. Arellano III, 55 Vice President Finance None
</TABLE>
I-2
<PAGE>
The following table sets forth the name, age, business or residence address,
citizenship, principal occupation or employment at the present time and during
the last five years, and the name of any corporation or other organization in
which such employment is conducted or was conducted of each executive officer or
director of Purchaser. Except as otherwise indicated, all of the persons listed
below are citizens of the United States of America. Each occupation set forth
opposite a person's name, unless otherwise indicated, refers to employment with
Ocean Group. Unless otherwise indicated, the principal business address of each
director or executive officer is c/o Ocean Group plc, Ocean House, The Ring,
Bracknell, Berkshire RG12 1AW, United Kingdom.
<TABLE>
<CAPTION>
NAME, AGE, CITIZENSHIP AND PRESENT OCCUPATION OR OTHER MATERIAL POSITIONS HELD
CURRENT BUSINESS ADDRESS EMPLOYMENT DURING THE PAST FIVE YEARS
- ------------------------------------ ------------------------------------ ------------------------------------
<S> <C> <C>
Michael Peter Fountain, 45 Regional Chief Executive Americas None
British citizenship Pacific Region--MSAS Global
Logistics Inc.
Ian Richard Smith, 45 Group Commercial Director Managing Director--Monitor Company
British citizenship from 1985 to 1998
Stuart Anthony Young, 42 Director of Mergers and Acquisitions Group Financial Controller from 1994
British citizenship to 1997
</TABLE>
I-3
<PAGE>
Manually signed facsimile copies of the Letter of Transmittal will be
accepted. Letters of Transmittal and certificates for Shares should be sent or
delivered by each stockholder of the Company or his broker, dealer, commercial
bank or trust company to the Depositary at one of its addresses set forth below:
The Depositary for the Offer is:
[LOGO]
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
BankBoston, N.A. BankBoston, N.A. Securities Transfer &
Attn: Corporate Attn: Corporate Reporting Services, Inc.
Reorganization Reorganization c/o Boston EquiServe LP
P.O. Box 8029 150 Royall Street 100 Williams Street/Galleria
Boston, MA 02266-8029 Canton, MA 02021 New York, NY 10038
</TABLE>
<TABLE>
<S> <C>
BY FACSIMILE TRANSMISSION CONFIRM RECEIPT OF FACSIMILE
(FOR ELIGIBLE INSTITUTIONS ONLY): BY TELEPHONE ONLY:
(781) 575-2233/2232 (781) 575-3120
</TABLE>
Any questions or requests for assistance may be directed to the Information
Agent or the Dealer Manager at their respective addresses and telephone numbers
set forth below. Requests for additional copies of this Offer to Purchase and
the Letter of Transmittal may be directed to the Information Agent. Stockholders
may also contact their brokers, dealers, commercial banks or trust companies for
assistance concerning the Offer.
The Information Agent for the Offer is:
[LOGO]
Wall Street Plaza
New York, NY 10005
Bankers and Brokers Call Collect: (212) 440-9800
All Others Call Toll-Free: (800) 223-2064
The Dealer Manager for the Offer is:
MERRILL LYNCH & CO.
World Financial Center
South Tower, 6th Floor
New York, NY 10080
(212) 236-3790 (Call Collect)
<PAGE>
LETTER OF TRANSMITTAL
TO TENDER SHARES OF COMMON STOCK
OF
MARK VII, INC.
AT
$23.00 NET PER SHARE
PURSUANT TO THE OFFER TO PURCHASE FOR CASH DATED JULY 29, 1999
OF
MSAS ACQUISITION CORPORATION
A WHOLLY OWNED SUBSIDIARY OF
MSAS GLOBAL LOGISTICS INC.
AN INDIRECT WHOLLY OWNED SUBSIDIARY OF
OCEAN GROUP PLC
- ---------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON THURSDAY, AUGUST 26, 1999, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
THE DEPOSITARY FOR THE OFFER IS:
[LOGO]
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
BankBoston, N.A. BankBoston, N.A. Securities Transfer & Reporting
Attn: Corporate Reorganization Attn: Corporate Reorganization Services, Inc.
P.O. Box 8029 150 Royall Street c/o Boston EquiServe LP
Boston, MA 02266-8029 Canton, MA 02021 100 Williams Street/Galleria
New York, NY 10038
</TABLE>
<TABLE>
<S> <C>
BY FACSIMILE TRANSMISSION CONFIRM RECEIPT OF FACSIMILE
(FOR ELIGIBLE INSTITUTIONS ONLY): BY TELEPHONE ONLY:
(781) 575-2233/2232 (781) 575-3120
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS OTHER THAN AS SET FORTH ABOVE OR
TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER OTHER THAN ONE LISTED ABOVE
DOES NOT CONSTITUTE A VALID DELIVERY. YOU MUST SIGN THIS LETTER OF TRANSMITTAL
IN THE APPROPRIATE SPACE PROVIDED THEREFOR, WITH SIGNATURE GUARANTEE IF
REQUIRED, AND COMPLETE THE SUBSTITUTE FORM W-9 SET FORTH BELOW. SEE INSTRUCTION
1.
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 used by stockholders of Mark VII, Inc.
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, dated July 29, 1999 (the "Offer to Purchase") is utilized, if delivery
of Shares is to be made by book-entry transfer to the account maintained by
BankBoston, N.A. (the "Depositary") at The Depository Trust Company (the
"Book-Entry Transfer Facility") pursuant to the procedures set forth in Section
2 of the Offer to Purchase. Stockholders whose certificates are not immediately
available or who cannot deliver their certificates or deliver confirmation of
the book-entry transfer of their Shares (as defined below) into the Depositary's
account at the Book-Entry Transfer Facility ("Book-Entry Confirmation") and all
other documents required hereby to the Depositary on or prior to the Expiration
Date (as defined in the Offer to Purchase) may nevertheless tender their Shares
according to the guaranteed delivery procedures set forth in Section 2 of the
Offer to Purchase. See Instruction 2. DELIVERY OF DOCUMENTS TO THE BOOK-ENTRY
TRANSFER FACILITY DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
Any questions or requests for assistance may be directed to the Information
Agent or the Dealer Manager at their respective addresses and telephone numbers
set forth below. Requests for additional copies of this Offer to Purchase and
the Letter of Transmittal may be directed to the Information Agent. Stockholders
may also contact their brokers, dealers, commercial banks or trust companies for
assistance concerning the Offer.
<PAGE>
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
MADE TO THE ACCOUNT MAINTAINED BY THE DEPOSITARY WITH THE 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: ____________________________________________
Account Number: ___________________________________________________________
Transaction Code Number: __________________________________________________
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE
FOLLOWING:
Name(s) of Registered Holder(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:
Account Number: ___________________________________________________________
Transaction Code Number: __________________________________________________
The names and addresses of the registered holder(s) should be printed
exactly as they appear on the certificates representing Shares tendered hereby.
The certificates and number of Shares that the undersigned wishes to tender
should be indicated in the appropriate boxes.
<TABLE>
<CAPTION>
- ---------------------------------------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
- ---------------------------------------------------------------------------------------------------------------
NAMES(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S)
(PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) APPEAR(S) ON SHARE CERTIFICATE(S) AND SHARE(S) TENDERED
SHARE CERTIFICATE(S)) (ATTACH ADDITIONAL LIST IF NECESSARY)
- ---------------------------------------------------------------------------------------------------------------
TOTAL NUMBER
SHARE OF SHARES NUMBER
CERTIFICATE REPRESENTED BY OF SHARES
NUMBER(S)* CERTIFICATE(S) TENDERED**
<S> <C> <C> <C>
- ---------------------------------------------------------------------------------------------------------------
-------------------------------------------------
-------------------------------------------------
-------------------------------------------------
-------------------------------------------------
-------------------------------------------------
TOTAL SHARES
- ---------------------------------------------------------------------------------------------------------------
* Need not be completed by stockholders tendering by book-entry transfer.
** Unless otherwise indicated, it will be assumed that all Shares being delivered to the Depositary are being
tendered.
See Instruction 4.
- ---------------------------------------------------------------------------------------------------------------
</TABLE>
2
<PAGE>
NOTE: SIGNATURES MUST BE PROVIDED BELOW.
PLEASE READ CAREFULLY THE ACCOMPANYING INSTRUCTIONS.
LADIES AND GENTLEMEN:
The undersigned hereby tenders to MSAS Acquisition Corporation, a Delaware
corporation ("Purchaser") and a wholly owned subsidiary of MSAS Global Logistics
Inc., a New York corporation ("Parent"), which is an indirect wholly owned
subsidiary of Ocean Group plc, a public limited company organized under the laws
of England and Wales ("Ocean Group"), the above described shares of common
stock, $0.05 par value per share (the "Shares"), of Mark VII, Inc. a Delaware
corporation (the "Company"), pursuant to Purchaser's offer to purchase all of
the outstanding Shares upon the terms and subject to the conditions set forth in
the Offer to Purchase, dated July 29, 1999 (the "Offer to Purchase"), receipt of
which is hereby acknowledged, and in this Letter of Transmittal (which, together
with any amendments or supplements thereto, collectively constitute the
"Offer"), at a purchase price of $23.00 per Share, net to the seller in cash,
without interest thereon.
Subject to, and effective upon, acceptance for payment of the Shares
tendered herewith, in accordance with the terms and subject to the conditions of
the Offer (including, if the Offer is extended or amended, the terms and
conditions of any such extension or amendment), the undersigned hereby sells,
assigns and transfers to, or upon the order of, Purchaser all right, title and
interest in and to all the Shares that are being tendered hereby (and any and
all other Shares or other securities issued or issuable in respect thereof on or
after July 29, 1999) and irrevocably constitutes and appoints the Depositary the
true and lawful agent and attorney-in-fact of the undersigned with respect to
such Shares (and any such other Shares or securities) with full power of
substitution (such power of attorney being deemed to be an irrevocable power
coupled with an interest), to (a) deliver certificates for such Shares (and any
such other Shares or securities), or transfer ownership of such Shares (and any
such other Shares or securities) on the account books maintained by the
Book-Entry Transfer Facility, together in either such case with all accompanying
evidences of transfer and authenticity, to or upon the order of Purchaser upon
receipt by the Depositary, as the undersigned's agent, of the purchase price
(adjusted, if appropriate, as provided in the Offer to Purchase), (b) present
such Shares (and any such other Shares or securities) for transfer on the books
of the Company and (c) receive all benefits and otherwise exercise all rights of
beneficial ownership of such Shares (and any such other Shares or securities),
all in accordance with the terms of the Offer.
The undersigned hereby irrevocably appoints each designee of Purchaser as
the attorney-in-fact and proxy of the undersigned, each with full power of
substitution, to the full extent of such stockholder's rights with respect to
the Shares tendered and hereby accepted for payment by Purchaser (and any and
all other Shares or other securities), to vote in such manner as each such
attorney and proxy or his substitute shall in his sole discretion deem proper,
and otherwise act (including pursuant to written consent) with respect to all
the Shares tendered hereby which have been accepted for payment by Purchaser
prior to the time of such vote or action (and any and all other Shares or
securities issued or issuable in respect thereof on or after July 29, 1999),
which the undersigned is entitled to vote at any meeting of stockholders
(whether annual or special and whether or not an adjourned meeting) of the
Company, or consent in lieu of any such meeting, or otherwise. This power of
attorney and proxy is coupled with an interest in the Company and in the Shares
and is irrevocable and is granted in consideration of, and is effective upon,
the acceptance for payment by Purchaser of Shares tendered in accordance with
the terms of the Offer. Such acceptance for payment shall revoke, without
further action, all prior powers of attorney and proxies granted by the
undersigned at any time with respect to such Shares (and any such other Shares
or other securities) and no subsequent powers of attorney, consents or
revocations proxies will be given (and if given will be deemed not to be
effective) with respect thereto by the undersigned. The undersigned acknowledges
that in order for Shares to be deemed validly tendered, immediately upon the
acceptance for payment of such Shares, the Purchaser or the Purchaser's designee
must be able to exercise full voting and all other rights which inure to a
record and beneficial holder with respect to such Shares.
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, sell, assign and transfer the Shares tendered
hereby (and any and all other Shares or other securities issued or issuable in
respect thereof after July 29, 1999), that the undersigned owns the Shares
tendered hereby within the meaning of Rule 14e-4 promulgated under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), that the
tender of the tendered Shares complies with Rule 14e-4 under the Exchange Act
and that, when the same are accepted for payment by Purchaser, Purchaser will
acquire good, marketable and unencumbered title thereto, free and clear of all
liens, restrictions, charges and encumbrances and the same will not be subject
to any adverse claim. The undersigned, upon request, will execute and deliver
any additional documents deemed by the Depositary or Purchaser to be necessary
or desirable to complete the sale, assignment and transfer of the Shares
tendered hereby (and any and all such other Shares or other securities). In
addition, the undersigned shall remit and transfer promptly to the Depositary
for the account of Purchaser all Shares or other securities issued in respect of
the Shares tendered hereby, accompanied by appropriate documentation of
transfer, and, pending such remittance and transfer or appropriate assurance
thereof, Purchaser shall be entitled to all rights and privileges as owner of
each such issued Share or security and may withhold the entire purchase price of
the Shares tendered hereby or deduct from such purchase price the amount or
value of such issued Share or security as determined by Purchaser in its sole
discretion.
All authority herein conferred or agreed to be conferred in this Letter of
Transmittal shall not be affected by, and shall survive, the death or incapacity
of the undersigned and any obligation of the undersigned hereunder shall be
binding upon the successors, assigns, heirs, executors, administrators and legal
representatives of the undersigned. Except as stated in the Offer to Purchase,
this tender is irrevocable.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described in Section 2 of the Offer to Purchase and in the
instructions hereto will constitute a binding agreement between the undersigned
and Purchaser upon the terms and subject to the conditions of the Offer.
3
<PAGE>
Unless otherwise indicated herein under "Special Payment Instructions,"
please issue the check for the purchase price and/or return any certificates for
Shares not tendered or accepted for payment in the name(s) of the undersigned.
Similarly, unless otherwise indicated under "Special Delivery Instructions,"
please mail the check for the purchase price and/or return any certificates for
Shares not tendered or accepted for payment (and accompanying documents, as
appropriate) to the undersigned at the address shown below the undersigned's
signature. 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 return any certificates for Shares not tendered or
accepted for payment in the name(s) of, and deliver such check and/or return
such certificates to the person or persons so indicated. Stockholders tendering
Shares by book-entry transfer may request that any Shares not accepted for
payment be returned by crediting the account maintained at the Book-Entry
Transfer Facility by making an appropriate entry under "Special Payment
Instructions." The undersigned recognizes that Purchaser has no obligation
pursuant to the Special Payment Instructions to transfer any Shares from the
name of the registered holder(s) thereof if Purchaser does not accept for
payment any of the Shares so tendered.
4
<PAGE>
- --------------------------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if certificates for Shares not tendered or not
purchased and/or the check for the purchase price of Shares purchased are to
be issued in the name of someone other than the undersigned, or if Shares
tendered by book-entry transfer which are not purchased are to be returned
by credit to an account maintained at The Depository Trust Company.
Issue check and/or certificate to:
Name: ______________________________________________________________________
(PLEASE PRINT)
Address: ___________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
(INCLUDING ZIP CODE)
____________________________________________________________________________
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER)
(ALSO COMPLETE SUBSTITUTE FORM W-9 BELOW)
----------------------------------------------------------------
----------------------------------------------------------------
Credit unpurchased Shares delivered by book-entry transfer to an account
maintained at The Depository Trust Company.
____________________________________________________________________________
(ACCOUNT NUMBER)
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if certificates for Shares not tendered or not
purchased and/or the check for the purchase price of Shares purchased are to
be sent to someone other than the undersigned, or to the undersigned at an
address other than that shown above.
Issue check and/or certificate to:
Name: ______________________________________________________________________
(PLEASE PRINT)
Address: ___________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
(INCLUDING ZIP CODE)
____________________________________________________________________________
(TAX IDENTIFICATION OR SOCIAL SECURITY NUMBER)
(ALSO COMPLETE SUBSTITUTE FORM W-9 BELOW)
----------------------------------------------------------------
----------------------------------------------------------------
5
<PAGE>
- --------------------------------------------------------------------------------
IMPORTANT--SIGN HERE
(COMPLETE SUBSTITUTE FORM W-9)
X __________________________________________________________________________
X __________________________________________________________________________
(SIGNATURE(S) OF HOLDER(S))
Dated: _______, 1999
(Must be signed by 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 a trustee, executor, administrator,
guardian, attorney-in-fact, agent, officer of a corporation or other person
acting in a fiduciary or representative capacity, please provide the
following information. See Instructions 1 and 5.)
Name(s) ____________________________________________________________________
____________________________________________________________________________
(PLEASE PRINT)
Capacity (Full Title) ______________________________________________________
(SEE INSTRUCTIONS)
Address ____________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
(INCLUDING ZIP CODE)
Area Code and Telephone Number ( ) _______________________________________
Employer Identification or Social Security Number __________________________
(COMPLETE SUBSTITUTE FORM W-9)
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED--SEE INSTRUCTIONS 1 AND 5)
Authorized Signature _______________________________________________________
Name(s) ____________________________________________________________________
(PLEASE PRINT)
Title ______________________________________________________________________
Name of Firm _______________________________________________________________
Address ____________________________________________________________________
____________________________________________________________________________
____________________________________________________________________________
(INCLUDING ZIP CODE)
Area Code and Telephone Number ( ) _______________________________________
Dated: ____________________________________________________________________,
1999
- --------------------------------------------------------------------------------
6
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURE. No signature guarantee on this Letter of
Transmittal is required (i) if this Letter of Transmittal is signed by the
registered holder(s) of the Shares (which term, for purposes of this document,
shall include any participant in the Book-Entry Transfer Facility whose name
appears on a security position listing as the owner of the Shares) tendered
herewith, unless such holder(s) has completed either the box entitled "Special
Payment Instructions" or the box entitled "Special Delivery Instructions," or
(ii) if such Shares are tendered for the account of a bank, broker, dealer,
credit union, savings association or other entity that is a member in good
standing of the Securities Transfer Agents Medallion Program, the New York Stock
Exchange Medallion Signature Guarantee Program or the Stock Exchange Medallion
Program (each, an "Eligible Institution"). In all other cases, all signatures on
this Letter of Transmittal must be guaranteed by an Eligible Institution. See
Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES. This Letter of
Transmittal is to be completed by stockholders either if certificates for Shares
are to be forwarded herewith, or unless an Agent's Message (as defined in the
Offer to Purchase) is utilized, if tenders of Shares are to be made pursuant to
the procedures for tender by book-entry transfer set forth in Section 2 of the
Offer to Purchase. Certificates evidencing all physically tendered Shares, or
any Book-Entry Confirmation of Shares, as the case may be, as well as a properly
completed and duly executed Letter of Transmittal (or a manually signed
facsimile thereof), together with any required signature guarantees, or an
Agent's Message in the case of a book-entry transfer, and any other documents
required by this Letter of Transmittal, must be received by the Depositary at
one of its addresses set forth herein on or prior to the Expiration Date (as
defined in Section 1 of the Offer to Purchase). Stockholders whose certificates
for Shares are not immediately available or who cannot deliver their
certificates for Shares or Book-Entry Confirmation and all other required
documents to the Depositary on or prior to the Expiration Date may tender their
Shares by properly completing and duly executing the Notice of Guaranteed
Delivery pursuant to the guaranteed delivery procedure set forth in Section 2 of
the Offer to Purchase. Pursuant to this procedure, (i) the tender of Shares must
be made by or through an Eligible Institution, (ii) a properly completed and
duly executed Notice of Guaranteed Delivery, substantially in the form provided
by Purchaser, must be received by the Depositary on or prior to the Expiration
Date, and (iii) the certificates evidencing all physically tendered Shares or
Book-Entry Confirmations, as the case may be, together with a properly completed
and duly executed Letter of Transmittal (or facsimile thereof), together with
any required signature guarantees, or an Agent's Message in the case of a
book-entry transfer, and any other documents required by this Letter of
Transmittal, must be received by the Depositary within three Nasdaq National
Market trading days after the date of execution of such Notice of Guaranteed
Delivery, all as provided in Section 2 of the Offer to Purchase.
THE METHOD OF DELIVERY OF THIS LETTER OF TRANSMITTAL, THE CERTIFICATES FOR
SHARES AND ALL OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH THE
BOOK-ENTRY TRANSFER FACILITY, IS AT THE SOLE OPTION AND RISK OF THE TENDERING
STOCKHOLDER AND, EXCEPT AS OTHERWISE PROVIDED IN THIS INSTRUCTION 2, 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.
No alternative, conditional or contingent tenders will be accepted and no
fractional Shares will be purchased. All tendering stockholders, by execution of
this Letter of Transmittal (or a manually signed facsimile 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 TENDER (NOT APPLICABLE TO STOCKHOLDERS WHO TENDER BY BOOK-ENTRY
TRANSFER). If fewer than all the Shares evidenced by any certificate(s)
submitted are to be tendered, fill in the number of Shares that are to be
tendered in the box entitled "Number of Shares Tendered." In such case, new
certificate(s) for the remainder of the Shares that were evidenced by your old
certificate(s) 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 or the termination of the Offer. All Shares represented by certificates
delivered to the Depositary will be deemed to have been tendered unless
otherwise indicated.
5. SIGNATURES ON LETTER OF TRANSMITTAL, STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the Shares
tendered hereby, the signature(s) must correspond exactly with the name(s) as
they appear on the face of the certificate(s) evidencing such Shares without
alteration, enlargement or any change whatsoever.
If any of the Shares tendered hereby are held of record by two or more joint
holders, all such holders must sign this Letter of Transmittal.
If any of the Shares tendered hereby 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 such
certificates.
If this Letter of Transmittal or any certificates or stock powers are signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such person should so indicate when signing, and proper evidence satisfactory to
Purchaser of such person's authority to so act must be submitted.
7
<PAGE>
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares listed and tendered hereby, no endorsements of certificates or separate
stock powers are required, unless payment is to be made, or certificates for
Shares not tendered or not purchased are to be issued, to a person other than
the registered holders(s), in which case, the certificates evidencing the Shares
tendered hereby must be endorsed or accompanied by appropriate stock powers, in
either case signed exactly as the name(s) of the registered holder(s) appear(s)
on such certificate(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 Shares listed, the certificates must be endorsed or
accompanied by appropriate stock powers, in either case corresponding exactly
with the name(s) of the registered holder(s) appearing on the certificates.
Signatures on such certificates or stock powers must be guaranteed by an
Eligible Institution.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6,
Purchaser will pay or cause to be paid any stock transfer taxes with respect to
the transfer and sale of purchased Shares to it or its order pursuant to the
Offer. If payment of the purchase price is to be made to, or if certificates for
Shares not tendered or purchased are to be registered in the name of, any person
other than the registered holder(s), or if tendered certificates are registered
in the name of any person other than the person(s) signing this Letter of
Transmittal, the amount of any stock transfer taxes (whether imposed on the
registered holder(s) or such person(s)) payable on account of the transfer to
such person will be deducted from the purchase price unless satisfactory
evidence of the payment of such taxes or exemption therefrom is submitted.
EXCEPT AS PROVIDED IN THIS INSTRUCTION 6, IT WILL NOT BE NECESSARY FOR
TRANSFER TAX STAMPS TO BE AFFIXED TO THE CERTIFICATES LISTED IN THIS LETTER OF
TRANSMITTAL.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check for the purchase
price of any Shares tendered hereby is to be issued, or certificates evidencing
unpurchased Shares are to be issued in the name of a person other than the
signer of this Letter of Transmittal, or if a check is to be sent and/or such
certificates are to be returned to someone other than the persons signing this
Letter of Transmittal or to an address other than that shown in the box entitled
"Description of Shares Tendered," the appropriate boxes on this Letter of
Transmittal must be completed. A stockholder tendering Shares by book-entry
transfer may request that Shares not purchased be credited to such account
maintained at the Book-Entry Transfer Facility as such stockholders may
designate in the box entitled "Special Payment Instructions." If no such
instructions are given, such Shares not purchased will be returned by crediting
the account at the Book-Entry Transfer Facility designated above from which such
Shares were delivered.
8. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Requests for assistance
may be directed to the Dealer Manager or the Information Agent at the addresses
and telephone numbers set forth on the back cover of this Letter of Transmittal.
Additional copies of the Offer to Purchase, this Letter of Transmittal and the
Notice of Guaranteed Delivery may be obtained from the Information Agent at the
address set forth below or from your broker, dealer, commercial bank or trust
company.
9. WAIVER OF CONDITIONS. Subject to the terms of the Merger Agreement (as
defined in the Offer to Purchase), the conditions of the Offer may be waived by
Purchaser, in whole or in part, at any time and from time to time in Purchaser's
sole discretion, in the case of any Shares tendered.
10. SUBSTITUTE FORM W-9. A tendering stockholder is required to provide
the Depositary with a correct Taxpayer Identification Number ("TIN") on
Substitute Form W-9 which is provided under "Important Tax Information" below,
and to certify whether the stockholder is subject to backup withholding of
federal income tax. If a tendering stockholder is subject to backup withholding,
the stockholder must cross out item (2) of the Certification box of the
Substitute Form W-9. Failure to provide the information on the Substitute Form
W-9 may subject the tendering stockholder to federal income tax withholding of
31% of the payment of the purchase price. 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, he or she should write "Applied For" in the space provided
for the TIN in Part I, and sign and date the Substitute Form W-9. If "Applied
For" is written in Part I, the Depositary will withhold 31% on all payments of
the purchase price, but such withholdings will be refunded if the tendering
stockholder provides a TIN within 60 days.
11. LOST, DESTROYED OR STOLEN CERTIFICATES. If any certificate(s)
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(s). This Letter
of Transmittal and related documents cannot be processed until the procedures
for replacing lost or destroyed certificates have been followed.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A MANUALLY SIGNED FACSIMILE
HEREOF), PROPERLY COMPLETED AND DULY EXECUTED, WITH ANY REQUIRED SIGNATURE
GUARANTEES, OR IN THE CASE OF BOOK-ENTRY TRANSFER, AN AGENT'S MESSAGE, TOGETHER
WITH SHARE CERTIFICATES OR BOOK-ENTRY CONFIRMATIONS AND ALL OTHER REQUIRED
DOCUMENTS, MUST BE RECEIVED BY THE DEPOSITARY, OR A PROPERLY COMPLETED AND DULY
EXECUTED NOTICE OF GUARANTEED DELIVERY MUST BE RECEIVED BY THE DEPOSITARY, ON OR
PRIOR TO THE EXPIRATION DATE.
8
<PAGE>
IMPORTANT TAX INFORMATION
Under U.S. federal income tax law, a stockholder whose tendered Shares are
accepted for payment is required to provide the Depositary 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 tendering
stockholder is subject to backup withholding, he or she must cross out item (2)
of the Certification box on the Substitute Form W-9. If the Depositary is not
provided with the correct TIN, the stockholder may be subject to a $50 penalty
imposed by the Internal Revenue Service. In addition, payments that are made to
such stockholder with respect to Shares purchased pursuant to the Offer may be
subject to backup withholding of 31%.
Certain stockholders (including, among others, all corporations and certain
foreign individuals) are not subject to these backup withholding and reporting
requirements. In order for a foreign individual to qualify as an exempt
recipient, that stockholder must submit a W-8, signed under penalties of
perjury, attesting to that individual's exempt status.
A Form W-8 may be obtained from the Depositary. Exempt stockholders, other
than foreign individuals, should furnish their TIN, write "Exempt" on the face
of the Substitute Form W-9 below and sign, date and return the Substitute Form
W-9 to the Depositary. See the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional instructions.
If backup withholding applies, the Depositary is required to withhold 31% of
any payments made to the stockholder. 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.
PURPOSE OF SUBSTITUTE FORM W-9
To prevent backup withholding on payments that are made to a stockholder
with respect to Shares purchased pursuant to the Offer, the stockholder is
required to notify the Depositary of his or her correct TIN by completing the
form below certifying that the TIN provided on the Substitute Form W-9 is
correct (or that such stockholder is awaiting a TIN), and that such stockholder
is not subject to backup witholding because (i) such stockholder has not been
notified by the Internal Revenue Service that such stockholder is subject to
backup witholding as a result of a failure to report all interest or dividends,
or (ii) the Internal Revenue Service has notified such stockholder that such
stockholder is no longer subject to backup withholding. To prevent possible
erroneous backup withholding, exempt stockholders (other than certain foreign
individuals) should certify in accordance with the Guidelines for Certification
of Taxpayer Identification Number on Substitute Form W-9 that such stockholder
is exempt from backup withholding.
WHAT NUMBER TO GIVE THE DEPOSITARY
The stockholder is required to give the Depositary the social security
number or employer identification number of the record holder(s) of the Shares.
If the Shares are in more than one name or are not in the name of the actual
holder(s), consult the enclosed Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9 for additional guidelines on which
number to report. 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, such
stockholder should write "Applied For" in the space provided for the TIN in Part
I, and sign and date the Substitute Form W-9. If "Applied For" is written in
Part I, the Depositary will withhold 31% on all payments of the purchase price,
but such withholdings will be refunded if the tendering stockholder provides a
TIN within 60 days.
9
<PAGE>
<TABLE>
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------------------------------
PAYER'S NAME: BANKBOSTON, N.A.
- ----------------------------------------------------------------------------------------------------------------
SUBSTITUTE PART I--Please provide your TIN in the
FORM W-9 box at right and certify by signing and
dating below Social Security Number or Employer
Identification Number (if awaiting TIN
write "Applied For")
DEPARTMENT OF THE TREASURY PART II-- For Payees exempt from backup withholding, see the attached Guidelines for
INTERNAL REVENUE SERVICE Certification of Taxpayer Identification Number on Substitute Form W-9 and
complete as instructed therein.
CERTIFICATION--Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct Taxpayer Identification Number (or a
Taxpayer Identification Number has not been issued to me) and either (a) I have
mailed or delivered an application to receive a Taxpayer Identification Number
to the appropriate Internal Revenue Service ("IRS") or Social Security
Administration office or (b) I intend to mail or deliver an application in the
near future (I understand that if I do not provide a Taxpayer Identification
Number to the Depository, 31% of all reportable payments made to me will be
withheld, but will be refunded if I provide a certified Taxpayer Identification
Number within 60 days); and
PAYER'S REQUEST FOR (2) I am not subject to backup withholding either because I have not been notified
TAXPAYER IDENTIFICATION by the IRS that I am subject to backup withholding as a result of a failure to
NUMBER ("TIN") report all interest or dividends, or the IRS has notified me that I am no longer
AND CERTIFICATION subject to backup withholding.
FOR PAYEE EXEMPT FROM
BACKUP WITHHOLDING
CERTIFICATION INSTRUCTIONS You must cross out item (2) above if you have been
notified by the IRS that you are subject to backup withholding because of
underreporting interest or dividends on your tax return. However, if after being
notified by the IRS that you were subject to backup withholding you received another
notification from the IRS that you are no longer subject to backup withholding, do
not cross out item (2). (Also see instructions in the enclosed Guidelines.)
Signature Date
Name
Address
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP WITHHOLDING
OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE REVIEW
THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
THE INFORMATION AGENT FOR THE OFFER IS:
[LOGO]
WALL STREET PLAZA
NEW YORK, NY 10005
BANKERS AND BROKERS CALL COLLECT: (212) 440-9800
ALL OTHERS CALL TOLL FREE: (800) 223-2064
THE DEALER MANAGER FOR THE OFFER IS:
MERRILL LYNCH & CO.
WORLD FINANCIAL CENTER
SOUTH TOWER, 6TH FLOOR
NEW YORK, NY 10080
(212) 236-3790 (CALL COLLECT)
10
<PAGE>
NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF SHARES OF COMMON STOCK
OF
MARK VII, INC.
TO
MSAS ACQUISITION CORPORATION
A WHOLLY OWNED SUBSIDIARY OF
MSAS GLOBAL LOGISTICS INC.
AN INDIRECT WHOLLY OWNED SUBSIDIARY OF
OCEAN GROUP PLC
- --------------------------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON THURSDAY, AUGUST 26, 1999, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
This form, or one substantially equivalent to this form, must be used to
accept the Offer (as defined below) if certificates representing shares of
common stock, $0.05 par value per share (collectively, the "Shares"), of Mark
VII, Inc., a Delaware corporation, are not immediately available, if the
procedure for book-entry transfer cannot be completed on a timely basis, or if
time will not permit all required documents to reach BankBoston, N.A. (the
"Depositary") on or prior to the Expiration Date (as defined in the Offer to
Purchase). This form may be delivered by hand or transmitted by telegram,
facsimile transmission or mail to the Depositary. See Section 2 of the Offer to
Purchase.
The Depositary for the Offer is:
[LOGO]
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
BankBoston, N.A. BankBoston, N.A. Securities Transfer &
Attn: Corporate Attn: Corporate Reporting Services, Inc.
Reorganization Reorganization c/o Boston EquiServe LP
P.O. Box 8029 150 Royall Street 100 Williams Street/Galleria
Boston, MA 02266-8029 Canton, MA 02021 New York, NY 10038
</TABLE>
<TABLE>
<S> <C>
BY FACSIMILE TRANSMISSION CONFIRM RECEIPT OF FACSIMILE
(FOR ELIGIBLE INSTITUTIONS ONLY): BY TELEPHONE ONLY:
(781) 575-2233/2232 (781) 575-3120
</TABLE>
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN ONE SET
FORTH ABOVE, OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION OTHER
THAN THE FACSIMILE NUMBER SET FORTH ABOVE, WILL NOT CONSTITUTE A VALID DELIVERY.
This form is not to be used to guarantee signatures. If a signature on a
letter of transmittal is required to be guaranteed by an "Eligible Institution"
under the instructions thereto, such signature guarantee must appear in the
applicable space provided in the signature box on the Letter of Transmittal.
<PAGE>
The undersigned hereby tenders to MSAS Acquisition Corporation, a Delaware
corporation and a wholly owned subsidiary of MSAS Global Logistics Inc., a New
York corporation which is an indirect wholly owned subsidiary of Ocean Group
plc, a public limited company organized under the laws of England and Wales,
upon the terms and subject to the conditions set forth in the Offer to Purchase
dated July 29, 1999 and the related Letter of Transmittal (which, each as
amended or supplemented from time to time, together constitute the "Offer"),
receipt of which is hereby acknowledged, the number of Shares indicated below
pursuant to the guaranteed delivery procedures set forth in Section 2 of the
Offer to Purchase.
Certificate No(s). (if available) ______________________________________________
Number of Shares tendered ______________________________________________________
Check if Shares will be tendered by book-entry transfer / /
Account Number at the Depository Trust Company _________________________________
Dated __________________________________________________________________ , 1999
Name(s) of Record Holder(s) ____________________________________________________
(PLEASE TYPE OR PRINT)
Address(es) ____________________________________________________________________
(ZIP CODE)
Area Code and Tel. No. _________________________________________________________
Signature(s) ___________________________________________________________________
- --------------------------------------------------------------------------------
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a bank, broker, dealer, credit union, savings
association or other entity that is a member in good standing of the
Securities Transfer Agents Medallion Program, the New York Stock Exchange
Medallion Signature Guarantee Program or the Stock Exchange Medallion
Program (a) represents that the above named person(s) "own(s)" the Shares
tendered hereby within the meaning of Rule 14e-4 promulgated under the
Securities Exchange Act of 1934, as amended, (b) represents that such tender
of Shares complies with Rule 14e-4 under the Exchange Act, and (c)
guarantees delivery to the Depositary, at one of its addresses set forth
above, of certificates representing the Shares tendered hereby in proper
form for transfer, or confirmation of book-entry transfer of such Shares
into the Depositary's account at The Depository Trust Company, in each case
with delivery of a properly completed and duly executed Letter of
Transmittal (or facsimile thereof) with any required signature guarantees or
an Agent's Message (as defined in Section 2 of the Offer to Purchase), and
any other required documents, within three Nasdaq National Market trading
days after the date hereof.
<TABLE>
<S> <C>
Name of Firm: (AUTHORIZED SIGNATURE)
(TITLE)
Address: Name:
(PLEASE TYPE OR PRINT)
(ZIP CODE) Title:
Area Code and
Telephone Number: Date: , 1999
NOTE: DO NOT SEND SHARE CERTIFICATES WITH THIS NOTICE. SHARE CERTIFICATES SHOULD BE SENT WITH YOUR LETTER OF
TRANSMITTAL.
</TABLE>
- --------------------------------------------------------------------------------
2
<PAGE>
[LOGO]
World Financial Center
South Tower, 6th Floor
New York, New York 10080
(212) 236-3790 (Call
Collect)
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
MARK VII, INC.
AT
$23.00 NET PER SHARE
BY
MSAS ACQUISITION CORPORATION
A WHOLLY OWNED SUBSIDIARY OF
MSAS GLOBAL LOGISTICS INC.
AN INDIRECT WHOLLY OWNED SUBSIDIARY OF
OCEAN GROUP PLC
- ------------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON THURSDAY, AUGUST 26, 1999, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
July 29, 1999
To Brokers, Dealers, Commercial Banks,
Trust Companies And Other Nominees:
We have been engaged to act as Dealer Manager in connection with the offer
by MSAS Acquisition Corporation, a Delaware corporation ("Purchaser") and a
wholly owned subsidiary of MSAS Global Logistics Inc., a New York corporation
("Parent"), which is an indirect wholly owned subsidiary of Ocean Group plc, a
public limited company organized under the laws of England and Wales ("Ocean
Group"), to purchase all outstanding shares of common stock, $0.05 par value per
share (collectively, the "Shares"), of Mark VII, Inc., a Delaware corporation
(the "Company"), at a purchase price of $23.00 per Share, net to the seller in
cash, without interest thereon, upon the terms and subject to the conditions set
forth in Purchaser's Offer to Purchase dated July 29, 1999 (the "Offer to
Purchase"), and the related Letter of Transmittal (which, together with any
amendments or supplements thereto, collectively constitute the "Offer").
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY
TENDERED BY THE EXPIRATION DATE AND NOT WITHDRAWN A NUMBER OF SHARES WHICH,
TOGETHER WITH ANY SHARES OWNED BY PARENT OR PURCHASER, CONSTITUTE AT LEAST A
MAJORITY OF THE SHARES OUTSTANDING ON A FULLY-DILUTED BASIS ON THE DATE SHARES
ARE ACCEPTED FOR PAYMENT AND (2) THE SATISFACTION OR WAIVER OF CERTAIN
CONDITIONS TO THE OBLIGATIONS OF PURCHASER, PARENT AND THE COMPANY TO CONSUMMATE
THE TRANSACTIONS CONTEMPLATED BY THE MERGER AGREEMENT, INCLUDING RECEIPT BY
PURCHASER, PARENT AND THE COMPANY OF CERTAIN GOVERNMENTAL AND REGULATORY
APPROVALS.
For your information and for forwarding to your clients for whom you hold
Shares registered in your name or in the name of your nominee, or who hold
Shares registered in their own names, we are enclosing the following documents:
1. Offer to Purchase dated July 29, 1999;
2. Letter of Transmittal to tender Shares for your use and for the
information of your clients. Facsimile copies of the Letter of Transmittal
(with manual signatures) may be used to tender Shares;
3. Letter to Clients which may be sent to your clients for whose account
you hold Shares in your name or in the name of your nominee, with space
provided for obtaining such clients' instructions with regard to the Offer;
<PAGE>
4. Notice of Guaranteed Delivery to be used to accept the Offer if
certificates for Shares are not immediately available or time will not
permit all required documents to reach the Depositary on or prior to the
Expiration Date (as defined in the Offer to Purchase), or if the procedures
for book-entry transfer, as set forth in the Offer to Purchase, cannot be
completed on a timely basis;
5. The Letter to Stockholders of the Company from R.C. Matney, the Chief
Executive Officer of the Company, accompanied by the Company's
Solicitation/Recommendation Statement on Schedule 14D-9;
6. Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9; and
7. Return envelope addressed to BankBoston, N.A., as Depositary.
Upon the terms and subject to the satisfaction or waiver (where applicable)
of the conditions of the Offer, Purchaser will purchase, by accepting for
payment, and will pay for, all Shares validly tendered on or prior to the
Expiration Date and not theretofore properly withdrawn promptly after the
Expiration Date. For purposes of the Offer, Purchaser will be deemed to have
accepted for payment, and thereby purchased, tendered Shares if, as and when
Purchaser gives oral or written notice to the Depositary of Purchaser's
acceptance of such Shares for payment. In all cases, payment for Shares accepted
for payment pursuant to the Offer will be made only after timely receipt by the
Depositary of (i) certificates for Shares or timely confirmation of a book-entry
transfer of such Shares, if such procedure is available, into the Depositary's
account at the Book-Entry Transfer Facility (as defined in the Offer to
Purchase) pursuant to the procedures set forth in Section 2 of the Offer to
Purchase, (ii) the Letter of Transmittal (or facsimile thereof), properly
completed and duly executed, or an Agent's Message (as defined in the Offer to
Purchase) and (iii) any other documents required by the Letter of Transmittal
with any signature guarantees.
Purchaser will not pay any fees or commissions to any broker or dealer or
other person (other than the Depositary, the Information Agent and the Dealer
Manager as described in the Offer to Purchase) in connection with the
solicitation of tenders of Shares pursuant to the Offer. However, Purchaser
will, upon request, reimburse you for customary mailing and handling expenses
incurred by you in forwarding the enclosed materials to your clients.
Purchaser will pay or cause to be paid any stock transfer taxes payable on
the transfer of Shares to it, except as otherwise provided in Instruction 6 of
the enclosed Letter of Transmittal.
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS
PROMPTLY AS POSSIBLE. THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00
MIDNIGHT, NEW YORK CITY TIME, ON THURSDAY, AUGUST 26, 1999, UNLESS THE OFFER IS
EXTENDED.
In order to take advantage of the Offer, a duly executed and properly
completed Letter of Transmittal (or manually signed facsimile thereof) and any
other required documents with any required signature guarantees should be sent
to the Depositary, and certificates representing the tendered Shares should be
delivered, or such Shares should be tendered by book-entry transfer, 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 certificates or other required documents prior to the Expiration
Date, a tender may be effected by following the guaranteed delivery procedures
specified under Section 2 in the Offer to Purchase.
Any inquires you may have with respect to the Offer should be addressed to
the Information Agent or the Dealer Manager at their respective addresses and
telephone numbers set forth on the back cover page of the enclosed Offer to
Purchase. Additional copies of the enclosed materials may be obtained from the
Information Agent.
Very truly yours,
MERRILL LYNCH, PIERCE, FENNER & SMITH
INCORPORATED
Enclosures
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY PERSON AS AN AGENT OF OCEAN GROUP, PARENT, PURCHASER, THE COMPANY, THE
DEPOSITARY, THE INFORMATION AGENT OR THE DEALER MANAGER OR AUTHORIZE YOU OR ANY
OTHER PERSON TO USE ANY DOCUMENT OR MAKE ANY STATEMENTS ON BEHALF OF ANY OF THEM
IN CONNECTION WITH THE OFFER OTHER THAN THE DOCUMENTS ENCLOSED AND THE
STATEMENTS CONTAINED THEREIN.
2
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
MARK VII, INC.
AT
$23.00 NET PER SHARE
BY
MSAS ACQUISITION CORPORATION
A WHOLLY OWNED SUBSIDIARY OF
MSAS GLOBAL LOGISTICS INC.
AN INDIRECT WHOLLY OWNED SUBSIDIARY OF
OCEAN GROUP PLC
- ---------------------------------------------------------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON THURSDAY, AUGUST 26, 1999, UNLESS THE OFFER IS EXTENDED.
- --------------------------------------------------------------------------------
July 29, 1999
To Our Clients:
Enclosed for your consideration is an Offer to Purchase dated July 29, 1999
and the related Letter of Transmittal (which, together with any amendments or
supplements thereto, collectively constitute the "Offer") relating to an offer
by MSAS Acquisition Corporation, a Delaware corporation ("Purchaser") and a
wholly owned subsidiary of MSAS Global Logistics Inc., a New York corporation
("Parent"), which is an indirect wholly owned subsidiary of Ocean Group, a
public limited company organized under the laws of England and Wales ("Ocean
Group"), to purchase all outstanding shares of common stock, $0.05 par value per
share (collectively, the "Shares"), of Mark VII, Inc., a Delaware corporation
(the "Company"), at a purchase price of $23.00 per Share, net to the seller in
cash, without interest thereon, upon the terms and subject to the conditions set
forth in the Offer. We are the holder of record of Shares held by us for your
account. The Letter of Transmittal is furnished to you for your information only
and cannot be used by you to tender Shares. A tender of Shares may be made only
by us as the holder of record and pursuant to your instructions.
If a stockholder desires to tender Shares pursuant to the Offer and such
stockholder's certificates for Shares are not immediately available or time will
not permit all required documents to reach the Depositary (as defined in the
Offer to Purchase) prior to the Expiration Date (as defined in the Offer to
Purchase), or the procedure for book-entry transfer cannot be completed on a
timely basis, such Shares may nevertheless be tendered according to the
guaranteed delivery procedures set forth in Section 2 of the Offer to Purchase.
See Instruction 2 of the Letter of Transmittal. Delivery of documents to the
Book-Entry Transfer Facility (as defined in the Offer to Purchase) in accordance
with the Book-Entry Transfer Facility's procedures does not constitute delivery
to the Depositary.
We request instructions as to whether you wish to tender any or all Shares
held by us for your account, pursuant to the terms and conditions set forth in
the Offer.
Your attention is directed to the following:
1. The tender price is $23.00 per Share, net to the seller in cash,
without interest thereon.
2. The Offer is being made for all outstanding Shares.
<PAGE>
3. This Offer is being made pursuant to the terms of an Agreement and
Plan of Merger, dated as of July 27, 1999 (the "Merger Agreement"), by and
among the Company, Parent and Purchaser. The Merger Agreement provides,
among other things, for the making of the Offer by Purchaser, and further
provides that, following the purchase of Shares pursuant to the Offer and
promptly after the satisfaction or waiver of certain conditions, Purchaser
will be merged with and into the Company (the "Merger"). The Company will
continue as the surviving corporation after the Merger and will be a wholly
owned subsidiary of Parent.
4. The Board of Directors of the Company has unanimously approved the
Offer and the Merger and has determined that the terms of the Offer and the
Merger are in the best interests of the stockholders of the Company, and
unanimously recommends that stockholders of the Company accept the Offer and
tender their Shares.
5. The Offer and withdrawal rights will expire at 12:00 midnight, New
York City time, on Thursday, August 26, 1999, unless extended.
6. THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING
VALIDLY TENDERED BY THE EXPIRATION DATE AND NOT WITHDRAWN A NUMBER OF SHARES
WHICH, TOGETHER WITH ANY SHARES ON THE DATE SHARES ARE ACCEPTED FOR PAYMENT
OWNED BY PARENT OR PURCHASER, CONSTITUTE AT LEAST A MAJORITY OF THE SHARES
OUTSTANDING ON A FULLY-DILUTED BASIS AND (2) THE SATISFACTION OR WAIVER OF
CERTAIN CONDITIONS TO THE OBLIGATIONS OF PURCHASER, PARENT AND THE COMPANY
TO CONSUMMATE THE TRANSACTIONS CONTEMPLATED BY THE MERGER AGREEMENT,
INCLUDING RECEIPT BY PURCHASER, PARENT AND THE COMPANY OF CERTAIN
GOVERNMENTAL AND REGULATORY APPROVALS.
7. Stockholders who tender Shares will not be obligated to pay brokerage
commissions or, except as set forth in Instruction 6 of the Letter of
Transmittal, transfer taxes on the purchase of Shares by Purchaser pursuant
to the Offer.
The Offer is made solely by the Offer to Purchase and the related Letter of
Transmittal and any supplements or amendments thereto. 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. If, after such good faith effort, the
Purchaser cannot comply with such state statute, the Offer will not be made to
(nor will tenders be accepted from or on behalf of) the holders of Shares in
such state. In any jurisdiction where the securities, blue sky or other laws
require the Offer to be made by a licensed broker or dealer, the Offer shall be
deemed to be made on behalf of the Purchaser by the Dealer Manager (as defined
in the Offer to Purchase) or one or more registered brokers or dealers which are
licensed under the laws of such jurisdiction.
If you wish to have us tender any or all of your Shares, please so instruct
us by completing, signing and returning the form set forth on page 3. Your
instructions to us should be forwarded in ample time to permit us to submit a
tender on your behalf prior to the expiration of the Offer.
2
<PAGE>
INSTRUCTIONS WITH RESPECT TO
THE OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
MARK VII, INC.
AT
$23.00 NET PER SHARE
BY
MSAS ACQUISITION CORPORATION
A WHOLLY OWNED SUBSIDIARY OF
MSAS GLOBAL LOGISTICS INC.
AN INDIRECT WHOLLY OWNED SUBSIDIARY OF
OCEAN GROUP PLC
The undersigned acknowledge(s) receipt of your letter and the enclosed Offer
to Purchase, dated July 29, 1999, of MSAS Acquisition Corporation, a Delaware
corporation ("Purchaser") and a wholly owned subsidiary of MSAS Global Logistics
Inc., a New York corporation which is an indirect wholly owned subsidiary of
Ocean Group plc, a public limited company organized under the laws of England
and Wales, and the related Letter of Transmittal (which, together with any
amendments or supplements thereto, collectively constitute the "Offer"),
relating to shares of common stock, $0.05 par value per share (collectively, the
"Shares"), of Mark VII, Inc., a Delaware corporation.
This will instruct you to tender to Purchaser the number of Shares indicated
below (or, if no number is indicated below, all Shares) held by you for the
account of the undersigned, on the terms and subject to the conditions set forth
in the Offer.
<TABLE>
<S> <C>
NUMBER OF SHARES TO BE TENDERED: SIGN HERE
SHARES
Signature(s)
Account Number:
Please print name(s) here
Please print address(es) here
Area Code and Telephone Number
Dated: , 1999
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.
3
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE
PAYER.--Social Security numbers have nine digits separated by two hyphens: i.e.
000-00-0000. Employer identification numbers have nine digits separated by only
one hyphen: i.e. 00-0000000. The table below will help determine the number to
give the payer.
- --------------------------------------------
<TABLE>
<CAPTION>
GIVE THE
SOCIAL SECURITY
FOR THIS TYPE OF ACCOUNT: NUMBER OF--
<C> <S> <C>
- -------------------------------------------------------
1. An individual's account The individual
2. Two or more individuals The actual owner of the
(joint account) account or, if combined
funds, the first
individual on the
account(1)
3. Husband and wife (joint The actual owner of the
account) account or, if joint
funds, either person (1)
4. Custodian account of a The minor (2)
minor (Uniform Gift to
Minors Act)
5. Adult and minor (joint The adult or, if the
account) minor is the only con-
tributor, the minor(1)
6. Account in the name of The ward, minor, or
guardian or committee incompetent person (3)
for a designated ward,
minor, or incompetent
person
7. a. The usual revocable The grantor-trustee (1)
savings trust
account (grantor is
also trustee)
b. So-called trust The actual owner(1)
account that is not
a legal or valid
trust under State
law
8. Sole proprietorship The owner(4)
account
</TABLE>
- --------------------------------------------
<TABLE>
<CAPTION>
GIVE THE EMPLOYER
IDENTIFICATION
FOR THIS TYPE OF ACCOUNT: NUMBER OF--
<C> <S> <C>
-------------------------------------------------------
9. A valid trust, estate, The legal entity (Do not
or pension trust furnish the identifying
number of the personal
representative or trus-
tee unless the legal
entity itself is not
designated in the
account title.)(5)
10. Corporate account The corporation
11. Religious, charitable, The organization
or education
organization
12. Partnership account held The partnership
in the name of the
business
13. Association, club, or The organization
other tax-exempt organ-
ization
14. A broker or registered The broker or nominee
nominee
15. Account with the The public entity
Department of Agricul-
ture in the name of a
public entity (such as a
State or local govern-
ment, 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 an 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 form 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.
- - 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 a least one nonresident alien partner.
- - Payments of patronage dividends where the amount received is not paid in
money.
- - Payments made by certain foreign organizations.
- - Payments made to a nominee.
Payments of interest 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 covenant bonds under Section 1451.
- - Payments made by certain foreign organizations.
- - Payments made to a nominee.
Exempt payees described above should file Form W-9 to avoid possible erroneous
backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER
IDENTIFICATION NUMBER. WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO
THE PAYER. IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO
SIGN AND DATE THE FORM.
Certain payments, other than interest, dividends, and patronage dividends, that
are not subject to information reporting are also not subject to backup
withholding. For details, see the regulations under sections 6041, 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. Payers must generally withhold 31% of taxable
interest, dividend, and certain other payments to a payee who does not furnish a
taxpayer identification number to a payer. Certain penalties may also apply.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER.--If you fail
to furnish your taxpayer identification number to a payer, you are subject to a
penalty of $50 for each such failure unless your failure is due to reasonable
cause and not to willful neglect.
(2) FAILURE TO REPORT CERTAIN DIVIDEND AND INTEREST PAYMENTS.--If you fail to
include any portion of an includible payment for interest, dividends, or
patronage dividends in gross income, such failure will be treated as being due
to negligence and will be subject to a penalty of 5% on any portion of an
underpayment attributable to that failure unless there is clear and convincing
evidence to the contrary.
(3) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING.--If you
make a false statement with no reasonable basis which results in no imposition
of backup withholding, you are subject to a penalty of $500.
(4) CRIMINAL PENALTY FOR FALSIFYING INFORMATION.--Willfully falsifying
certifications or affirmations may subject you to criminal penalties including
fines and/or imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL REVENUE
SERVICE.
<PAGE>
Exhibit 99.(a)(7)
This announcement is neither an offer to purchase nor a solicitation of an
offer to sell Shares (as defined below). The Offer is made solely by the
Offer to Purchase, dated July 29, 1999, and the related Letter of Transmittal
and any amendments and supplements thereto, and is being made to all holders
of Shares. MSAS Acquisition Corporation is not aware of any state where the
making of the Offer is prohibited by administrative or judicial action
pursuant to any valid statute. If MSAS Acquisition Corporation becomes aware
of any valid state statute prohibiting the making of the Offer or the
acceptance of the Shares pursuant thereto, MSAS Acquisition Corporation will
make a good faith effort to comply with such statute or seek to have such
statute declared inapplicable to the Offer. If, after such good faith effort,
MSAS Acquisition Corporation cannot comply with such state statute, the Offer
will not be made to (nor will tenders be accepted from or on behalf of)
holders of Shares in any such state. In any jurisdiction where 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 MSAS Acquisition
Corporation by Merrill Lynch, Pierce, Fenner & Smith Incorporated 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
MARK VII, INC.
at
$23.00 NET PER SHARE
by
MSAS ACQUISITION CORPORATION
a wholly owned subsidiary of
MSAS GLOBAL LOGISTICS INC.
an indirect wholly owned subsidiary of
OCEAN GROUP PLC
MSAS Acquisition Corporation, a Delaware corporation ("Purchaser") and a
wholly owned subsidiary of MSAS Global Logistics Inc., a New York corporation
("Parent"), which is an indirect wholly owned subsidiary of Ocean Group plc, a
public limited company organized under the laws of England and Wales ("Ocean
Group"), is offering to purchase all outstanding shares of common stock, $0.05
par value per share (the "Shares"), of Mark VII, Inc., a Delaware corporation
(the "Company"), at a purchase price of $23.00 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 July 29, 1999 (the "Offer to Purchase"),
and in the related Letter of Transmittal (which, together with any amendments or
supplements thereto, collectively constitute the "Offer").
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON THURSDAY, AUGUST 26, 1999, UNLESS THE OFFER IS EXTENDED.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (1) THERE BEING VALIDLY
TENDERED BY THE EXPIRATION DATE AND NOT WITHDRAWN A NUMBER OF SHARES WHICH,
TOGETHER WITH ANY SHARES OWNED BY PARENT OR PURCHASER, CONSTITUTE AT LEAST A
MAJORITY OF THE SHARES OUTSTANDING ON A FULLY-DILUTED BASIS ON THE DATE SHARES
ARE ACCEPTED FOR PAYMENT AND (2) THE SATISFACTION OR WAIVER OF CERTAIN
CONDITIONS TO THE OBLIGATIONS OF PURCHASER, PARENT AND THE COMPANY TO CONSUMMATE
THE TRANSACTIONS CONTEMPLATED BY THE MERGER AGREEMENT, INCLUDING RECEIPT BY
PURCHASER, PARENT AND THE COMPANY OF CERTAIN GOVERNMENTAL AND REGULATORY
APPROVALS.
The Offer is being made pursuant to an Agreement and Plan of Merger, dated
as of July 27, 1999 (the "Merger Agreement"), by and among the Company, Parent
and Purchaser. Pursuant to the Merger Agreement and the Delaware General
Corporation Law (the "DGCL"), as soon as practicable following the consummation
of the Offer, Purchaser will be merged with and into the Company and the Company
will become a wholly owned subsidiary of Parent (the "Merger"). On the effective
date of the Merger, each outstanding Share (except for Shares owned by the
Company, Parent or Purchaser, or any subsidiary of the Company or Parent, and
except for Shares, if any, held by the Company's stockholders who have properly
exercised appraisal rights under the DGCL) will be converted into the right to
receive $23.00, in cash, without interest thereon. Parent and Purchaser have
entered into Tender and Voting Agreements and Irrevocable Proxies with six of
the directors of the Company (the "Proxy Grantors") holding in the aggregate
751,272 Shares, representing approximately 8.4% of the issued and outstanding
Shares. Pursuant to these agreements and irrevocable proxies, each Proxy Grantor
has agreed, provided the Merger Agreement has not been terminated, to tender to
Purchaser substantially all Shares beneficially owned by such Proxy Grantor, has
agreed to vote such Shares in favor of approval of the Merger Agreement and the
transactions contemplated thereby and has granted an irrevocable proxy to
Purchaser with respect to such Shares.
<PAGE>
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE OFFER
AND THE MERGER AND HAS DETERMINED THAT THE TERMS OF THE OFFER AND THE MERGER ARE
IN THE BEST INTERESTS OF THE STOCKHOLDERS OF THE COMPANY, AND UNANIMOUSLY
RECOMMENDS THAT STOCKHOLDERS OF THE COMPANY ACCEPT THE OFFER AND TENDER THEIR
SHARES.
The term "Expiration Date" means 12:00 Midnight, New York City time, on
Thursday, August 26, 1999, unless and until Purchaser extends the period of time
during which the Offer is open, in which event the term "Expiration Date" shall
mean the latest time and date on which the Offer, as so extended by Purchaser,
shall expire. Any such extension will be followed as promptly as practicable by
a public announcement thereof not later than 9:00 a.m., New York City time, on
the next business day after the previously scheduled Expiration Date of the
Offer.
Subject to the applicable rules and regulations of the Securities and
Exchange Commission, and subject to the terms of the Merger Agreement, Purchaser
expressly reserves the right, at any time or from time to time and regardless of
whether or not any of the events set forth in Section 18 of the Offer to
Purchase has occurred, (i) to extend the period of time during which the Offer
is open and thereby postpone acceptance for payment of any Shares by giving oral
or written notice of such extension to BankBoston, N.A., as Depositary (in such
capacity, the "Depositary"), and (ii) to amend the Offer in any other respect
permitted under the Merger Agreement by giving oral or written notice of such
amendment to the Depositary. Purchaser shall not have any obligation to pay
interest on the purchase price for tendered Shares, whether or not Purchaser
exercises its right to extend the Offer. Except as set forth in the Merger
Agreement, there can be no assurance that Purchaser will extend the Offer. Any
extension of the Offer will be followed by a public announcement thereof no
later than 9:00 a.m., New York City time, on the next business day after the
previously scheduled Expiration Date. During any such extension, all Shares
previously tendered and not withdrawn will remain tendered, subject to the right
of a tendering stockholder to withdraw such stockholder's Shares. Without
limiting the manner in which Purchaser may choose to make any public
announcement, Purchaser will have no obligation to publish, advertise or
otherwise communicate any such announcement other than by issuing a press
release to the Dow Jones News Service or otherwise as may be required by
applicable law.
For purposes of the Offer, Purchaser will be deemed to have accepted for
payment, and thereby purchased, Shares properly tendered to Purchaser and not
properly withdrawn as, if and when Purchaser gives oral or written notice to the
Depositary of Purchaser's acceptance for payment of such Shares. Upon the terms
and subject to the conditions set forth in the Offer, payment for Shares
purchased pursuant to the Offer will be made by deposit of the aggregate
purchase price therefor with the Depositary, which will act as agent for
tendering stockholders for the purpose of receiving payment from Purchaser and
transmitting payment to tendering stockholders whose Shares have been accepted
for payment.
In all cases, payment for Shares purchased pursuant to the Offer will be
made only after timely receipt by the Depositary of (a) certificates evidencing
such Shares or timely confirmation of book-entry transfer of such Shares into
the Depositary's account at the Book-Entry Transfer Facility (as defined in the
Offer to Purchase) pursuant to the procedures set forth in Section 2 of the
Offer to Purchase, (b) a properly completed and duly executed Letter of
Transmittal (or facsimile thereof) with any required signature guarantees, or,
in the case of a book-entry transfer, an Agent's Message (as defined in the
Offer to Purchase) and (c) any other documents required by the Letter of
Transmittal. The per Share consideration paid to any stockholder pursuant to the
Offer will be the highest per Share consideration paid to any other stockholder
pursuant to the Offer. Under no circumstance will interest be paid by Purchaser
on the purchase price of the Shares accepted for payment, regardless of any
extension of the Offer or any delay in making such payment.
Pursuant to the Merger Agreement, Purchaser may make any changes in the
terms and conditions of the Offer, provided that, unless previously approved by
the Company in writing, Purchaser may not (i) decrease the purchase price, (ii)
change the form of consideration payable in the Offer, (iii) decrease the number
of Shares sought pursuant to the Offer, (iv) add additional conditions to the
Offer, (v) amend the conditions to the Offer to broaden their scope, (vi) extend
the Offer except as permitted by the terms of the Merger Agreement, (vii) amend
the Minimum Condition (as defined in the Offer to Purchase) or (viii) make other
changes to the Offer that are adverse to the Company's stockholders.
Except as provided in Section 3 of the Offer to Purchase, tenders of Shares
made pursuant to the Offer are irrevocable. Shares tendered pursuant to the
Offer may be withdrawn at any time on or prior to the Expiration Date. 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 the Offer to Purchase and must specify
the name of the person having tendered the Shares to be withdrawn, the number of
Shares to be withdrawn and the name of the registered holder of the Shares to be
withdrawn, if different from the name of the person who tendered the Shares. If
certificates evidencing such 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 evidencing the
Shares to be withdrawn must be submitted to the Depositary, and, unless such
Shares have been tendered by an Eligible Institution (as defined in the Offer to
Purchase), the signature on the notice of withdrawal must be guaranteed by an
Eligible Institution. If Shares have been delivered pursuant to the procedures
for book-entry transfer as set forth in Section 2 of the Offer to Purchase, any
notice of withdrawal must also specify the name and number of the account at the
Book-Entry Transfer Facility to be credited with the withdrawn Shares and
otherwise comply with the Book-Entry Transfer Facility's procedures. Withdrawals
of tendered Shares may not be rescinded, and any Shares properly withdrawn will
thereafter be deemed not validly tendered for purposes of the Offer. However,
withdrawn Shares may be retendered by again following one of the procedures
described in Section 2 of the Offer to Purchase at any time prior to the
Expiration Date. All questions as to the form and validity (including time of
receipt) of notices of withdrawal will be determined by Purchaser, in its sole
discretion, which determination will be final and binding.
The information required to be disclosed by Rule 14d-6(e)(1)(vii) of 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 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 related Letter of Transmittal and other
relevant documents will be mailed to record holders of Shares whose names appear
on the stockholder list and will be furnished to brokers, dealers, commercial
banks, trust companies and similar persons whose names, or the names of whose
nominees, appear on the Company's stockholder lists, or, if applicable, who are
listed as participants in a clearing agency's security position listing, for
subsequent transmittal to beneficial owners of Shares.
The Offer to Purchase and the related Letter of Transmittal contain
important information which should be read carefully before any decision is made
with respect to the Offer.
Questions and requests for assistance may be directed to the Information
Agent or the Dealer Manager (each as defined in the Offer to Purchase), at their
respective addresses and telephone numbers set forth below. Requests for copies
of the Offer to Purchase, the Letter of Transmittal and other related materials
may be directed to the Information Agent or to brokers, dealers, commercial
banks or trust companies and copies will be furnished promptly at Purchaser's
expense. No fees or commissions will be paid to any broker or dealer or other
person, other than the Dealer Manager and the Information Agent, for soliciting
tenders of Shares pursuant to the Offer.
The Information Agent for the Offer is:
Georgeson Shareholder Communications Inc.
Wall Street Plaza
New York, New York 10005
Banks and Brokers Call Collect: (212) 440-9800
All Others Call Toll Free: (800) 223-2064
<PAGE>
The Dealer Manager for the Offer is:
MERRILL LYNCH & CO.
World Financial Center
South Tower, 6th Floor
New York, New York 10080
(212) 236-3790 (Call Collect)
July 29, 1999
<PAGE>
EXHIBIT 99(A)(8)
27 JULY 1999 Ocean Group logo
OCEAN MAKES (POUND)143M RECOMMENDED
OFFER FOR LEADING USA LOGISTICS
BUSINESS
PRESS INFORMATION
Ocean Group plc, one of the world's leading global logistics companies, today
announced a recommended offer to acquire 100% of the shares of Mark VII, Inc, a
NASDAQ quoted multi-modal transportation logistics company.
The cash offer at $23 per share values the company at $227m ((pound)143m). The
consideration will be satisfied out of Ocean's existing cash reserves and new
banking facilities. The Board of Mark VII have recommended the offer to its
shareholders and have irrevocably accepted the offer for their shares which
account for 8.4% of the issued shares. The Chairman/CEO and the President of the
Transportation Services Group will reinvest a proportion of the proceeds they
receive in Ocean shares. The offer is open until 26 August 1999 and is
conditional on acceptances for not less than 50% of the shares and on routine
USA regulatory clearance.
Mark VII, one of the largest non-asset based third-party logistics companies in
the USA, has shown rapid growth in recent years and in 1998 achieved revenues of
$725m. Operating income has grown from $6.8m in 1994 to $16.6m in 1998, a
compound annual growth rate of over 25%. The business started in transport
brokerage covering road, rail and some sea freight. More recently it has grown
its transportation logistics business which now accounts for 37% of revenues.
The company is headquartered in Memphis where the majority of its 360 personnel
are based. In addition it has a network of 125 company and agency branch offices
in 35 states with an extensive customer list including Alcan Aluminium, BASF,
Frito Lay, Marriott International, Mobil Oil and Occidental Chemicals. At the
end of 1998 the company had shareholders funds of $41.2m.
John Allan, Ocean's Chief Executive, said today "One of the key strands of our
global strategy is to build our North American logistics capabilities. Following
the recent acquisition of Skyking, which gave us a US domestic airfreight
offering, and Fenton, which built up our US customs broking activity, Mark VII's
transport management capability will significantly enhance our provision of
integrated logistics solutions for our multi-national customers. In addition, we
plan to apply the Mark VII transportation logistics model to MSAS Global
Logistics businesses in other territories."
Mr Allan continued: "Mark VII has a strong management team and I am delighted
that this team will be remaining with the company and working with us to further
strengthen our growing US presence."
<PAGE>
- - ENDS -
For further information please contact:
John Allan, Chief Executive Tel: 01344 744363
John Coghlan, Finance Director Tel: 01344 744406
Ian Smith, Group Commercial Director Tel: 01344 744407
Tony Lascelles, Company Secretary and Tel: 01344 744409
Director of Corporate Affairs
2
<PAGE>
Exhibit (B)
DEUTSCHE BANK
Deutsche Bank AG London
Winchester House
1 Great Winchester Street
London EC2N 2DB
Tel 0171 545 8000
Fax 0171 545 4455
The Directors
Ocean Group plc
Ocean House
The Ring
Bracknell
Berkshire
RG12 1AN
26 July 1999
Dear Sirs
Re: L175,000,000 Multi-Currency Revolving Credit Facility
We refer to the proposed offer (the "Offer") to be made by you for all of the
existing share capital of Mark VII (the "Target").
We have pleasure in setting out the terms upon which Deutsche Bank AG London
("Deutsche") is prepared to arrange and underwrite a facility for your
general corporate and working capital purposes and to enable you to finance
the Offer.
Deutsche hereby commits to arrange and underwrite a syndicated multi-currency
revolving credit facility (the "Facility") in a maximum principal amount of
L175,000,000 upon the terms and subject to the conditions set out in the
outline terms and conditions (the "Term Sheet") attached hereto and subject
to the matters set out or referred to below. Words and expressions defined in
the Term Sheet have the same meanings when used in this letter.
The commitment of Deutsche to arrange and underwrite the Facility is also
subject to the following:
(i) the Offer being made on or before 6th August 1999;
(ii) the Offer being for an aggregate consideration of not greater than
US$235,000,000;
(iii) there being no event or circumstance in relation to the Offer which
would result in Deutsche acting contrary to any law, regulation, treaty
or official directive or request applicable to it; and
(iv) the preparation, execution and delivery of a Facility Agreement in
accordance with the terms and conditions set out in the Term Sheet.
This letter and the Term Sheet and the contents of the same are confidential and
shall not be disclosed to any person without the prior approval of Deutsche
other than (i) as required by law or court order, (ii) to your directors,
officers, employees, investors and advisors on a confidential and need-to-know
basis, and (iii) to the Target and its advisors in connection with the Offer.
-1-
<PAGE>
The commitment given under this letter is non-assignable.
This letter shall be governed by, and construed in accordance with, the laws of
England and Wales. Any dispute shall be subject to the non-exclusive
jurisdiction of the Courts of England and Wales to which you and Deutsche
irrevocably submit.
Please acknowledge your agreement to the terms of this letter by
countersigning the attached copy of this letter and returning it
countersigned by yourselves to Deutsche at the above address not later than
close of business on 27th July 1999 (London time), failing which Deutsche's
commitment hereunder will expire at such time. By countersigning the attached
copy of this letter you confirm Deutsche's appointment as the sole and
exclusive arranger of the Facility on the terms set out in this letter and
the Term Sheet.
We look forward to working with you.
Yours faithfully
/s/ Mark Ashley /s/ Sean Malone
- ------------------------------- -------------------------------
Name: Mark Ashley Name: Sean Malone
Position: Associate Director Position: Director Syndications
For and on behalf of
Deutsche Bank AG London
Accepted and agreed
/s/ Ian R. Smith
- ------------------------------
Name: Ian R. Smith
Position: Group Commercial Director
For and on behalf of
Ocean Group plc
Date:
-2-
<PAGE>
OUTLINE TERMS AND CONDITIONS
- --------------------------------------------------------------------------------
OCEAN PLC
L175 MILLION
MULTI-CURRENCY REVOLVING CREDIT FACILITY
- --------------------------------------------------------------------------------
BORROWER Ocean Group plc ("Ocean" or "the Parent") or other
nominated wholly owned subsidiaries of Ocean
guaranteed by Ocean from time to time agreed with the
Lenders.
GUARANTOR Ocean.
The Guarantor together with the Borrowers are
referred to as the Obligors and the Parent together
with its subsidiaries is referred to as the Group.
AMOUNT L175 million
PURPOSE For general corporate and working capital purposes
and to assist in the acquisition of 100% of the share
capital of Mark VII Inc ("Mark VII") pursuant to a
tender offer (the "Offer") to be made by Ocean, or a
wholly owned subsidiary of Ocean, and related fees,
costs and expenses together with refinancing of debt
in Mark VII (if any).
ARRANGER & UNDERWRITER Deutsche Bank AG London ("Deutsche Bank")
AGENT Deutsche Bank
LENDERS A group of banks selected in consultation with the
Borrower.
FACILITY DESCRIPTION Syndicated Multi-Currency Revolving Credit Facility
FINAL MATURITY 5 years from the signing of the Facility Agreement
("Signing")
REPAYMENT Repaid in full at Final Maturity.
AVAILABILITY Subject to the completion of conditions precedent and
no actual or potential event of default, the Facility
will be available on a fully revolving basis until
Final Maturity by way of sterling advances and US
Dollar and freely available and convertible
multi-currency advances. The first drawing of the
Facility shall be used to fund the acquisition of
Mark VII pursuant to the Offer.
INTEREST RATE BASIS The aggregate of:-
i) the London Interbank Offered Rate ("LIBOR"),
plus;
ii) mandatory costs, plus;
iii) the Margin detailed below.
LIBOR As determined by the Agent on the basis of offer
rates to prime banks provided by page 3750 or 3740 of
Telerate.
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<PAGE>
MARGIN 0.60% per annum
UTILISATION FEE 0.05% per annum payable quarterly in arrear on
all drawings in the event of average daily
utilisation exceeding 33% of the Facility Amount.
0.10% per annum payable quarterly in arrear on all
drawings in the event of average daily utilisation
exceeding 66% of the Facility Amount.
COMMITMENT FEE 0.15% per annum until the Facility becomes available,
thereafter 50% of the Margin.
Commitment Fees are payable quarterly in arrear on
the daily undrawn and uncancelled amount of the
Facility.
INTEREST PERIODS 1, 2, 3 and 6 months at the option of the Borrower.
Other periods will be subject to the agreement of the
Lenders. Interest payments to be made at the maturity
of each drawing but in any event no less frequently
than six months from the relevant drawing.
Until completion of syndication Interest Periods will
be restricted to a maximum of one month unless
otherwise agreed by the Arranger.
CALCULATIONS All Interest and Commitment Fees shall accrue from
day to day and be calculated on the basis of a 365
day year where that is the convention and 360 day for
other currencies.
ARRANGEMENT FEE As set out in a letter dated the date of this
Term Sheet addressed by the Arranger to the Borrower.
AGENCY FEE As set out in a letter dated the date of this Term
Sheet addressed by the Arranger to the Borrower.
CANCELLATION & PREPAYMENT The Borrower may cancel or prepay the Facility
(without penalty) in whole or in part in minimum
amounts of (pound)5 million or a higher integral
multiple of (pound)1 million subject to 14 days
irrevocable notice to the Agent, subject, in the case
of prepayment, to payment of broken funding costs.
MANDATORY PREPAYMENT Upon change of control of Ocean, notice will be given
to the Facility Agent within 30 days triggering a
negotiation period of 60 days. At the end of this
period, if no agreement is reached to continue the
Facility, (a) any Lender may cancel its commitment,
and/or (b) the Majority Banks can require immediate
cancellation of all undrawn amounts and prepayment of
all outstandings under the Facility.
DOCUMENTATION The Facility will be governed by a Facility
Agreement, prepared by the lawyers to the Lenders, in
form and substance acceptable to all parties. In
particular, the Facility Agreement will contain usual
Euro market provisions, including, but not limited
to, the following clauses.
2
<PAGE>
CONDITIONS PRECEDENT
TO DRAWDOWN (i) legal opinions from Lenders Counsel;
(ii) copies of constitutional documents;
(iii) appropriate board and shareholder
resolutions of the Obligors approving the
execution, delivery and performance of the
Facility Agreement and related documents;
(iv) delivery of latest available accounts;
(v) no actual or potential event of default is
outstanding (but not to apply on rollovers
for the same amount in the same currency);
(vi) consents and authorisations;
(vii) confirmations that the representations and
warranties are correct;
(viii) execution of guarantees (if any); and
(ix) payment of all arrangement and agency fees
then due and payable
Specifically for the Offer:-
(i) copies of the press announcement and Merger
Agreement;
(ii) copies of legal and environmental due
diligence reports;
(iii) confirmation of that the Offer has been
declared unconditional in all respects,
including inter alia: that all regulatory
approvals, and that a minimum 50%
shareholder acceptances have been received
all in form reasonably satisfactory to the Arranger.
All conditions precedent to be satisfied on or before
30 September 1999.
REPRESENTATIONS AND The Parent will make representations and warranties,
WARRANTIES as follows:
(i) each Obligor is duly incorporated, validly
existing and has the power to enter into the
Facility Agreement and the guarantees and
comply with its obligations thereunder;
(ii) all necessary consents, licences and
approvals in relation to the Facility
Agreement and the guarantees have been
obtained and are validly existing;
(iii) the obligations of each Obligor under the
Facility Agreement constitute legal, valid
and binding obligations, ranking pari passu
with all other unsecured creditors of the
Obligor save where other obligations are
mandatorily preferred by law;
(iv) the obligations of each Obligor under the
Facility Agreement and the guarantees do not
conflict with:
(a) any relevant law;
(b) constitutional documents; or
3
<PAGE>
(c) any agreement or other document
binding on it or the Group
(including existing financing
arrangements);
(v) no litigation which will have a material
adverse effect is current, pending or
threatened;
(vi) no insolvency of the Parent or its
subsidiaries;
(vii) no material adverse change has occurred in
the financial condition of the Group since
the date of the latest accounts provided to
the Lenders;
(viii) the latest audited consolidated accounts of
the Parent have been prepared using UK
generally accepted accounting principles and
give a true and fair view of the
consolidated financial condition of the
Group as at the date thereof;
(ix) verbal information provided to the Arranger
prior to Signing is true, complete and
accurate in all material respects on each
date supplied by the Parent and all relevant
information has been disclosed to the
Arranger at Signing;
(x) that the information memorandum to be
prepared for syndication is true, complete
and accurate in all material respects and
that the assumptions used in the financial
model provided to the Lenders are believed
to be reasonable are provided in good faith
and after due enquiry; (to be given on
signing in of syndicate Lenders);
(xi) each of the Parent and its subsidiaries has
obtained such environmental licences and has
complied with the terms of such licences and
environmental laws in a manner consistent in
all material respects with generally
accepted industry good practice and there
has been no material use, disposal etc of
any dangerous substance on any premises in
contravention of any environmental law or
licence and there are no material
environmental claims pending or to its
knowledge threatened, which in each case
would materially adversely impact on the
ability of any Obligor to perform its
obligations under the Facility;
(xii) Year 2000 representation;
(xiii) no event of default is outstanding;
(xiv) the Parent is satisfied that the due
diligence reports received in relation to
Mark VII contain nothing of a material
adverse nature which would affect the
Arranger's decision to enter into this
Facility Agreement.
(xv) no default under agreements which would have
a material adverse effect.
The Representations and Warranties shall be deemed to
be repeated on the first drawdown date and on signing
in of the syndicate lenders and (except (v), (vi),
(vii) and (ix) to (xiv) inclusive) shall be repeated
on each subsequent drawdown date.
4
<PAGE>
A six month grace period shall apply after the date
of its acquisition by Ocean (the "Grace Period") in
respect of Mark VII's compliance with Representation
(xi) above.
COVENANTS/UNDERTAKINGS The Parent will provide undertakings including the
following:
(i) FINANCIAL STATEMENTS: delivery of
consolidated financial statements for each
Obligor as soon as available and in any
event within 120 days of financial year-end,
interim unaudited financial statements in
respect of the Parent as soon as available
and in any event within 90 days of each
half-year end;
(ii) SPECIFIC INFORMATION: provision of such
other information made available to the
Parent's shareholders or its creditors
generally in relation to it and its
subsidiaries;
(iii) GENERAL INFORMATION: provision of such other
information as the Agent may reasonably
request;
(iv) COMPLIANCE CERTIFICATES: delivery with
annual and interim financial statements of
certificates of the Parent's directors
demonstrating compliance with the Financial
Covenants;
(v) PARI PASSU: maintenance of at least pari
passu status vis-a-vis all other unsecured,
unsubordinated creditors of the Obligor save
where other obligations are mandatorily
preferred by law;
(vi) COMPLIANCE: compliance in all material
respects with all relevant laws, permits and
licences including, in particular, all
environmental laws and licences;
(vii) NOTICE OF DEFAULT: notification to the Agent
of any actual or potential event of default;
(viii) NEGATIVE PLEDGE: negative pledge on all
Group companies subject to agreed
exceptions; (see also preferred indebtedness
below)
(ix) INSURANCE: maintenance of appropriate
insurances;
(x) CHANGE OF BUSINESS: restriction on change of
the overall nature of business of the Group
as a whole;
(xi) MERGER: Obligors will not merge with any
other company;
(xii) PREFERRED INDEBTEDNESS: subsidiary and
secured borrowings to be limited to the
aggregate of
- preferred indebtedness at the date
of Signing ((pound)54.4 million)
and
- L30 million.
(xiii) DISPOSALS: the Borrower will not, save for
normal carve outs, with the prior written
consent of the Lenders, dispose of any part
of its undertaking or assets which when
aggregated with all other disposals by the
Borrower exceed 15% of the Gross Tangible
Assets of the Group in any accounting
reference period and 30%
5
<PAGE>
of Gross Tangible Assets over the life of
the Facility.
COVENANTS RELATING TO
THE OFFER Will include:
(a) restriction on material amendments or
waivers in relation to the Offer;
(b) restriction on publicity relating to the
Offer referring to the Arranger, Agent or
Lenders.
FINANCIAL COVENANTS (i) INTEREST COVER Consolidated Earnings Before
Interest and Tax ("EBIT") to be a minimum of
3 times the level of Consolidated Net
Interest Expenditure. Tested semi-annually
on a rolling 12 month basis.
(ii) NET DEBT/EBITDA Consolidated Net Debt not to
exceed 2.5 times the level of Consolidated
Earnings Before Interest, Tax, Depreciation
and Amortisation ("EBITDA"). Tested
semi-annually on a rolling 12 month basis.
EVENTS OF DEFAULT For the Parent and its subsidiaries, (subject to
agreed grace periods), to include but not limited to:
(i) NON-PAYMENT: default in the payment of any
principal, interest or other amount due
under the Facility Agreement when due
(subject to a grace period of 3 business
days after breach unless for reason of a
technical or administrative delay);
(ii) BREACH OF COVENANT: breach of other
obligations under the Facility Agreement
(subject to, if remediable, a grace period
of 10 business days after the earlier of (i)
the Borrower becoming aware of such default
and (ii) notice of such default requiring
the Borrower to remedy the same has been
given by the Agent to the Borrower);
(iii) CROSS DEFAULT: any indebtedness of all or
any of the Group companies in excess of, in
aggregate (pound)10 million is not paid when
due or is declared to be or otherwise
becomes due and payable prior to its
specified maturity or any persons become
entitled to declare any such indebtedness
due and payable, subject to a six month
Grace Period in respect of Mark VII;
(iv) INSOLVENCY: insolvency of any Obligor or any
Material Subsidiary or appointment of a
liquidator, receiver, administrator or the
like;
(v) BANKRUPTCY ETC: bankruptcy, liquidation,
administration, receivership or other
analogous proceedings being commenced
against any Obligor or any Material
Subsidiary;
(vi) EXECUTION: any execution, distress,
attachment or legal process is levied made
or taken against the whole or any part of
the property, undertaking or assets (having
a value of at least
6
<PAGE>
L5 million) of any Group companies but
subject to a 30 day grace period;
(vii) REPRESENTATIONS AND WARRANTIES: any
Representation or Warranty is found to be
untrue in any respect when made or deemed to
have been made;
(viii) OWNERSHIP: any Obligor (other than Parent)
ceases to be a subsidiary of the Parent;
(ix) MATERIAL ADVERSE CHANGE: a material adverse
change occurs in the ability of any Obligor
to comply with its obligations under the
Facility Agreement or any guarantee;
(x) ILLEGALITY: it becomes unlawful for any
Obligor to comply with any or all of its
obligations under the Facility Agreement or
any guarantee.
Material Subsidiary: means a subsidiary of Ocean
whose consolidated gross assets or operating profits
represent 10% or more of the consolidated gross
assets or operating profits of the Group.
AMENDMENTS AND WAIVERS Amendments to the Facility Agreement will require the
approval of Majority Lenders (representing 662/3% of
the Facility Amount) with certain exceptions which
will require the consent of all Lenders.
ILLEGALITY In the event that it becomes illegal for any Lender
to lend or maintain its commitment (and subject to
usual mitigation), that Lender's commitment will be
cancelled and the Borrower will upon request repay
that Lender.
TAXES All payments to be made free and clear of all present
and future taxes and deductions save as required by
law (subject to appropriate gross-up) and subject to
the Lenders having appropriate tax status upon
becoming a party to the Facility Agreement and
completing any necessary formalities e.g. double tax
treaty or other tax forms.
INCREASED COSTS With certain usual exceptions and mitigation wording,
in the event of any law or the existing requirements
of any central bank or other competent authority
being changed, or any new requirements being imposed,
such that the overall cost to any of the Lenders of
providing the Facility is increased, and/or the
return on capital obtained by any of the Lenders in
respect of the Facility is reduced, the Borrowers
will following request by that Lender either:-
(i) recompense the relevant Lender(s) for the
higher costs/reduced return involved; or
(ii) at its option reduce or repay the relevant
Lender's commitment/outstandings without
penalty.
EXPENSES All legal, printing and out-of-pocket expenses
incurred in the negotiation, syndication and
completion of the Facility will be for the account of
the Borrower and payable
7
<PAGE>
within 30 days of the presentation of an invoice,
whether or not the transaction contemplated herein is
completed.
TRANSFERABILITY In minimum amounts of (pound)5 million or if less a
Lender's whole commitment, subject to the approval of
the Parent, not to be unreasonably withheld or
delayed (and if delayed by more than 5 business days
such approval shall be deemed to have been given).
CLEAR MARKET From the date of award of any mandate in respect of
the Facility until the earlier of close of
syndication and 30th September 1999, Ocean and its
subsidiaries including, subsequent to its becoming a
subsidiary of Ocean, Mark VII undertake not to
approach banks or other financial institutions in the
international or domestic debt, bank or capital
markets for any fund-raising without the Arranger's
prior written consent not to be unreasonably
withheld. For the avoidance of doubt this provision
excludes uncommitted facilities and short term
transactions made in the ordinary course of business.
GOVERNING LAW AND Laws of England with submission to the non-exclusive
JURISDICTION jurisdiction of the Courts of England.
CONFIDENTIALITY The term sheet is intended for the exclusive use of
Ocean and is made on the express understanding that
its terms and conditions will be treated as strictly
confidential.
EXCLUSIVITY You appoint the Arranger as exclusive arranger of the
Facility, provided that such exclusivity shall cease
in the event that the Arranger notifies the Borrower
that they are unable to proceed with the financing.
SYNDICATION Ocean to give such assistance in relation to the
syndication of the Facility as the Arranger may
reasonably require, including giving of presentations
by members of its management and assistance in
relation to the preparation of an information
memorandum.
DEUTSCHE BANK AG LONDON 26TH JULY 1999
8
<PAGE>
Exhibit 99(c)(1)
- --------------------------------------------------------------------------------
AGREEMENT AND PLAN OF MERGER
DATED AS OF JULY 27, 1999
BY AND AMONG
MARK VII, INC.,
MSAS GLOBAL LOGISTICS INC.
AND
MSAS ACQUISITION CORPORATION
- --------------------------------------------------------------------------------
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
Page
----
ARTICLE 1
THE OFFER
<S> <C>
Section 1.1. The Offer.....................................................................................1
Section 1.2. Company Actions...............................................................................3
Section 1.3. Boards of Directors and Committees; Section 14(f) of Exchange Act.............................5
ARTICLE 2
THE MERGER
Section 2.1. The Merger....................................................................................6
Section 2.2. Effective Time................................................................................6
Section 2.3. Closing of the Merger.........................................................................6
Section 2.4. Effects of the Merger.........................................................................6
Section 2.5. Certificate of Incorporation and Bylaws.......................................................7
Section 2.6. Directors.....................................................................................7
Section 2.7. Officers......................................................................................7
Section 2.8. Conversion of Shares..........................................................................7
Section 2.9. Appraisal Rights..............................................................................7
Section 2.10. Exchange of Certificates......................................................................8
Section 2.11. Stock Options; SARs...........................................................................9
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
Section 3.1. Organization and Qualification; Subsidiaries; Investments....................................10
Section 3.2. Capitalization of the Company and Its Subsidiaries...........................................11
Section 3.3. Authority Relative to This Agreement.........................................................12
Section 3.4. SEC Reports; Financial Statements............................................................13
Section 3.5. Consents and Approvals; No Violations........................................................13
Section 3.6. No Default...................................................................................14
Section 3.7. No Undisclosed Liabilities; Absence of Changes...............................................14
Section 3.8. Litigation...................................................................................15
Section 3.9. Compliance with Applicable Law...............................................................15
Section 3.10. Employee Benefits............................................................................16
Section 3.11. Labor and Employment Matters.................................................................18
Section 3.12. Environmental Laws and Regulations...........................................................19
Section 3.13. Taxes........................................................................................20
Section 3.14. Intellectual Property........................................................................22
Section 3.15. Insurance....................................................................................22
Section 3.16. Certain Business Practices...................................................................22
Section 3.17. Suppliers and Customers......................................................................23
</TABLE>
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<TABLE>
<CAPTION>
<S> <C>
Section 3.18. Vote Required................................................................................23
Section 3.19. Brokers......................................................................................23
Section 3.20. Takeover Statutes............................................................................23
Section 3.21. Year 2000 Capability.........................................................................23
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF PARENT AND ACQUISITION
Section 4.1. Organization.................................................................................24
Section 4.2. Authority Relative to This Agreement.........................................................24
Section 4.3. Consents and Approvals; No Violations........................................................24
Section 4.4. Litigation...................................................................................25
Section 4.5. Brokers......................................................................................25
Section 4.6. Financing....................................................................................25
Section 4.7. Operations of Acquisition....................................................................25
ARTICLE 5
COVENANTS
Section 5.1. Conduct of Business of the Company...........................................................26
Section 5.2. No Solicitation or Negotiation...............................................................28
Section 5.3. Meeting of Stockholders......................................................................30
Section 5.4. Access to Information; Confidentiality.......................................................31
Section 5.5. Certain Filings; Reasonable Efforts..........................................................31
Section 5.6. Public Announcements.........................................................................32
Section 5.7. Indemnification and Directors' and Officers' Insurance.......................................32
Section 5.8. Notification of Certain Matters..............................................................34
Section 5.9. Takeover Statutes............................................................................34
Section 5.10. Company Stock Options........................................................................34
Section 5.11. Company Information Supplied.................................................................35
Section 5.12. Parent and Acquisition Information Supplied..................................................35
Section 5.13. Support Letter...............................................................................35
Section 5.14. Employees and Employee Benefits..............................................................36
ARTICLE 6
CONDITIONS TO CONSUMMATION OF THE MERGER
Section 6.1. Conditions to Each Party's Obligations to Effect the Merger..................................36
ARTICLE 7
TERMINATION; AMENDMENT; WAIVER
Section 7.1. Termination..................................................................................37
Section 7.2. Effect of Termination........................................................................38
Section 7.3. Fees and Expenses............................................................................40
Section 7.4. Amendment....................................................................................40
Section 7.5. Extension; Waiver............................................................................40
</TABLE>
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<PAGE>
ARTICLE 8
MISCELLANEOUS
<TABLE>
<CAPTION>
<S> <C>
Section 8.1. Nonsurvival of Representations and Warranties................................................40
Section 8.2. Entire Agreement; Assignment.................................................................40
Section 8.3. Validity.....................................................................................40
Section 8.4. Notices......................................................................................41
Section 8.5. Governing Law and Venue; Waiver of Jury Trial................................................42
Section 8.6. Descriptive Headings; Article and Section References.........................................42
Section 8.7. Parties in Interest..........................................................................43
Section 8.8. Certain Definitions..........................................................................43
Section 8.9. Personal Liability...........................................................................44
Section 8.10. Specific Performance.........................................................................44
Section 8.11. Counterparts.................................................................................44
Annex A Conditions of the Offer.....................................................................A-1
</TABLE>
iii
<PAGE>
COMPANY DISCLOSURE SCHEDULE
<TABLE>
<CAPTION>
<S> <C>
Section 1.3(a).............Exceptions Relating to Subsidiary Boards
Section 3.1(a).............Subsidiaries
Section 3.2(a).............Company Securities
Section 3.2(b).............Certain Capitalization and Other Matters
Section 3.4(a).............Company SEC Reports
Section 3.5................Consents and Approvals
Section 3.6................Defaults
Section 3.7................Undisclosed Liabilities; Absence of Changes
Section 3.8................Litigation
Section 3.9................Compliance with Law
Section 3.10(a)............Compensation and Benefit Plans
Section 3.10(b)............Performance and Compliance Under Compensation and Benefit Plans
Section 3.10(c)............Pension Plans
Section 3.10(e)............Employee Matters
Section 3.10(g)............Reportable Events, Prohibited Transactions and Additional Liabilities or Benefits
Section 3.10(h)............Stock Options
Section 3.10(j)............Events Under Compensation and Benefit Plans
Section 3.10(k)............Foreign Plans
Section 3.10(l)............Termination of Compensation and Benefit Plans
Section 3.11(d)............Names and Compensation of Officers
Section 3.13(b)............Delinquent or Inaccurate Tax Returns
Section 3.13(c)............Unpaid Taxes
Section 3.13(d)............Tax Claims
Section 3.13(e)............Excess Parachute Payments
Section 3.13(f)............Tax Sharing Agreements
Section 3.13(g)............Limitations on Use of NOLs
Section 3.13(h)............Section 481 Adjustments
Section 3.15...............Insurance
Section 3.17...............Customers
Section 5.1................Conduct of Business
</TABLE>
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TABLE OF DEFINED TERMS
<TABLE>
<CAPTION>
Cross Reference
Term in Agreement Page
- ---- ------------ ----
<S> <C> <C>
Acquisition............................................................Preamble...................................1
affiliate..............................................................Section 8.8(a)............................43
Agreement..............................................................Preamble...................................1
Applicable Law.........................................................Section 8.8(b)............................43
Appraisal Rights.......................................................Section 2.9................................7
business day...........................................................Section 8.8(c)............................43
capital stock..........................................................Section 8.8(d)............................43
Certificate of Merger..................................................Section 2.2................................6
Certificates...........................................................Section 2.10(b)............................8
Closing................................................................Section 2.3................................6
Closing Date...........................................................Section 2.3................................6
Code...................................................................Section 3.13(a)(i)........................20
Commonly Controlled Entity.............................................Section 3.10(a)...........................16
Company................................................................Preamble...................................1
Company Board..........................................................Section 1.1(b).............................2
Company Common Stock...................................................Recitals...................................1
Company Disclosure Schedule............................................Article 3.................................10
Company Employees......................................................Section 5.14(a)...........................36
Company Permits........................................................Section 3.9...............................15
Company Plans..........................................................Section 5.14(a)...........................36
Company SEC Reports....................................................Section 3.4(a)............................13
Company Securities.....................................................Section 3.2(a)............................11
Company Stock Option...................................................Section 3.2(a)............................11
Company Stock Plans....................................................Section 2.11(b)............................9
Compensation and Benefit Plans.........................................Section 3.10(a)...........................16
Continuing Directors...................................................Section 1.3(a).............................5
DGCL...................................................................Section 1.2(a).............................3
Dissenting Share.......................................................Section 2.9................................7
Effective Time.........................................................Section 2.2................................6
Environmental Laws.....................................................Section 3.12(a)...........................19
ERISA..................................................................Section 3.10(a)...........................16
Exchange Act...........................................................Section 1.1(a).............................1
Exchange Agent.........................................................Section 2.10(a)............................8
Exchange Fund..........................................................Section 2.10(a)............................8
Fairness Opinion.......................................................Section 1.2(a).............................4
Final Date.............................................................Section 7.1(b)............................37
Financial Advisor......................................................Section 1.2(a).............................4
Foreign Plans..........................................................Section 3.10(k)...........................18
Governmental Entity....................................................Section 3.5...............................13
</TABLE>
1
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<TABLE>
<CAPTION>
<S> <C> <C>
Hazardous Material.....................................................Section 3.12(a)...........................19
HSR Act................................................................Section 3.5...............................13
include or including...................................................Section 8.8(f)............................43
Indemnified Liabilities................................................Section 5.7(a)............................33
Indemnified Persons....................................................Section 5.7(a)............................33
Insurance Policies.....................................................Section 3.15..............................22
Insured Parties........................................................Section 5.7(c)............................33
Intellectual Property..................................................Section 3.14..............................22
knowledge or known.....................................................Section 8.8(e)............................43
Lien...................................................................Section 3.2(b)............................12
Material Adverse Effect on Parent......................................Section 4.1(b)............................24
Material Adverse Effect on the Company.................................Section 3.1(b)............................10
Maximum Premium........................................................Section 5.7(c)............................33
Meeting................................................................Section 5.3(a)............................30
Merger.................................................................Section 2.1................................6
Merger Consideration...................................................Section 2.8(a).............................7
Minimum Condition......................................................Section 1.1(a).............................2
Notice of Superior Proposal............................................Section 5.2(b)............................29
Ocean Group............................................................Section 5.13..............................36
Offer..................................................................Recitals...................................1
Offer Documents........................................................Section 1.1(c).............................3
Offer Price............................................................Recitals...................................1
Parent.................................................................Preamble...................................1
Parent Plans...........................................................Section 5.14(a)...........................36
Pension Plans..........................................................Section 3.10(a)...........................16
person.................................................................Section 8.8(g)............................43
Proxy Statement........................................................Section 5.11..............................35
Representatives........................................................Section 5.4(b)............................31
SAR....................................................................Section 2.11(a)............................9
Schedule 14D-1.........................................................Section 1.1(c).............................2
Schedule 14D-9.........................................................Section 1.2(b).............................4
SEC....................................................................Section 1.1(b).............................2
Secretary of State.....................................................Section 2.2................................6
Securities Act.........................................................Section 3.4(a)............................13
Shares.................................................................Recitals...................................1
subsidiary or subsidiaries.............................................Section 8.8(i)............................43
Superior Proposal......................................................Section 5.2(c)............................30
Surviving Corporation..................................................Section 2.1................................6
Takeover Statute.......................................................Section 3.20..............................23
Tax or Taxes...........................................................Section 3.13(a)(ii).......................20
Tax Return.............................................................Section 3.13(a)(iii)......................20
Termination Fee Event..................................................Section 7.3(a)............................38
Third Party............................................................Section 5.2(c)............................30
</TABLE>
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<TABLE>
<CAPTION>
<S> <C> <C>
Third Party Acquisition................................................Section 5.2(c)............................30
Year 2000 Compliant....................................................Section 3.21..............................23
</TABLE>
3
<PAGE>
AGREEMENT AND PLAN OF MERGER
THIS AGREEMENT AND PLAN OF MERGER (this "AGREEMENT"), dated as of July
27, 1999, is by and among Mark VII, Inc., a Delaware corporation (the
"COMPANY"), MSAS Global Logistics Inc., a New York corporation ("PARENT"), and
MSAS Acquisition Corporation, a Delaware corporation and a wholly owned
subsidiary of Parent ("ACQUISITION"). Initially capitalized and certain other
terms not otherwise defined herein shall have the meanings ascribed to such
terms in Section 8.8 of this Agreement.
RECITALS
A. The Boards of Directors of the Company, Parent and Acquisition have
each (i) determined that the Merger (as defined below) is advisable and fair and
in the best interests of their respective stockholders and (ii) approved the
Merger upon the terms and subject to the conditions set forth in this Agreement.
B. In furtherance thereof, it is proposed that Acquisition, within five
business days after the public announcement hereof, will commence a tender offer
(the "OFFER") to acquire all of the outstanding shares (the "SHARES") of common
stock, $0.05 par value, of the Company (the "COMPANY COMMON STOCK"), at a price
of $23 per Share, net to the seller in cash, less any required withholding taxes
(such amount, or any greater amount per share paid pursuant to the Offer, being
hereinafter referred to as the "OFFER PRICE"), in accordance with the terms and
subject to the conditions provided herein.
NOW, THEREFORE, in consideration of the foregoing premises and the
representations, warranties, covenants and agreements herein contained, and
intending to be legally bound hereby, the Company, Parent and Acquisition hereby
agree as follows:
ARTICLE 1
THE OFFER
Section 1.1. THE OFFER.
(a) Provided that this Agreement shall not have been
terminated in accordance with Section 7.1 and subject to the terms hereof, as
promptly as practicable, but in no event later than five business days after the
public announcement of the execution hereof by the parties, Acquisition shall
(and Parent shall cause Acquisition to) commence (within the meaning of Rule
14d-2 under the Securities Exchange Act of 1934, as amended (the "EXCHANGE
ACT")), the Offer for any and all of the Shares, at the Offer Price. The
obligation of Acquisition to accept for payment and to pay for any Shares
tendered (and the obligation of Parent to cause Acquisition to accept for
payment and to pay for any Shares tendered) shall be subject only to (i) the
condition that there shall have been validly tendered a number of Shares which,
together with any Shares owned by Parent or Acquisition, constitute at least a
majority of Shares on a fully-diluted basis
<PAGE>
(including for purposes of such calculation all Shares issuable upon exercise of
all vested Company Stock Options (as defined in Section 3.2(a)) and unvested
Company Stock Options that vest prior to the Final Date, but excluding any
Shares held by the Company or any of its subsidiaries) (the "MINIMUM
CONDITION"), and (ii) the other conditions set forth in Annex A. Acquisition
expressly reserves the right to increase the Offer Price or to make any other
changes in the terms and conditions of the Offer; PROVIDED, HOWEVER, that unless
previously approved by the Company in writing, no change may be made that (i)
decreases the Offer Price, (ii) changes the form of consideration to be paid in
the Offer, (iii) reduces the maximum number of Shares to be purchased in the
Offer, (iv) imposes conditions to the Offer in addition to those set forth in
Annex A, (v) amends the conditions set forth in Annex A to broaden the scope of
such conditions, (vi) extends the Offer except as provided in Section 1.1(b),
(vii) amends the Minimum Condition or (viii) makes other changes to the Offer
that are adverse to the holders of Company Common Stock. The conditions set
forth in Annex A are for the sole benefit of Parent and Acquisition and may be
waived by Parent and Acquisition, in whole or in part at any time and from time
to time, in their sole discretion, other than the Minimum Condition, as to which
prior written Company approval is required. The failure by Parent and
Acquisition at any time to exercise any of the foregoing rights shall not be
deemed a waiver of any such right, and each such right shall be deemed an
ongoing right that may be asserted at any time and from time to time. No Shares
held by the Company or any of its subsidiaries will be tendered in the Offer.
(b) Subject to the terms and conditions thereof, the Offer
will expire at midnight, New York City time, on the date that is 20 business
days after the date the Offer is commenced; PROVIDED, HOWEVER, that without the
consent of the Company's Board of Directors (the "COMPANY BOARD"), Acquisition
may: (i) extend the Offer for any period required by any rule, regulation,
interpretation or position of the Securities and Exchange Commission (the "SEC")
or the staff thereof applicable to the Offer; or (ii) extend the Offer on one
occasion for an aggregate period of not more than 20 business days beyond the
latest expiration date that would otherwise be permitted under clause (i) of
this sentence if on such expiration date the Minimum Condition shall have been
satisfied and there shall not have been tendered at least 90% of the outstanding
Shares. Parent and Acquisition agree that, if any one or more of the conditions
to the Offer set forth on Annex A are not satisfied by the time of any scheduled
expiration date of the Offer, then, provided, that such conditions are
reasonably capable of being satisfied on or prior to October 7, 1999,
Acquisition shall extend the Offer from time to time unless any such condition
is no longer reasonably capable of being satisfied; PROVIDED, HOWEVER, that in
no event shall Acquisition be required to extend the Offer beyond October 7,
1999. Subject to the terms and conditions of the Offer and this Agreement,
Acquisition shall (and Parent shall cause Acquisition to) accept for payment,
and pay for, all Shares validly tendered and not withdrawn pursuant to the
Offer, as promptly as practicable after the expiration of the Offer.
(c) As soon as practicable on the date the Offer is
commenced, Parent and Acquisition will file with the SEC a Tender Offer
Statement on Schedule 14D-1 (together with all amendments and supplements
thereto, and including all exhibits thereto, the "SCHEDULE 14D-1") with respect
to the Offer. The Schedule 14D-1 will contain as an exhibit or incorporate by
reference the Offer to Purchase (or portions thereof) and forms of the related
letter of transmittal and summary advertisement. Parent and Acquisition will
cause the
2
<PAGE>
Schedule 14D-1, the Offer to Purchase and all amendments or supplements thereto
(which together constitute the "OFFER DOCUMENTS") to comply in all material
respects with the Exchange Act and the rules and regulations thereunder and
other Applicable Law. Parent and Acquisition represent that the Offer Documents,
on the date first published, sent or given to the Company's stockholders, will
not 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, except that no representation is made by Parent or Acquisition
with respect to information supplied by the Company or any of its stockholders
in writing specifically for inclusion or incorporation by reference in the Offer
Documents. The Company represents that the information provided by the Company
in writing specifically for inclusion or incorporation by reference in the Offer
Documents will not 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. Each of Parent, Acquisition and the Company agrees
promptly to correct any information provided by it for use in the Offer
Documents if and to the extent that such information shall have become false or
misleading in any material respect, and Parent and Acquisition further agree to
take all steps necessary to cause the Schedule 14D-1 as so corrected to be filed
with the SEC and the other Offer Documents as so corrected to be disseminated to
the Company's stockholders, in each case as and to the extent required by
applicable federal securities laws. The Company and its counsel will be given
reasonable opportunity to review and comment on the Offer Documents prior to the
filing thereof with the SEC. Parent and Acquisition will provide the Company and
its counsel with any comments Parent, Acquisition or their counsel may receive
from the SEC or its staff with respect to the Offer Documents promptly after
receipt of such comments.
(d) In the event that this Agreement has been terminated
pursuant to Section 7.1 prior to the purchase of any Shares pursuant to the
Offer, Acquisition shall (and Parent shall cause Acquisition to) promptly
terminate the Offer without accepting any Shares for payment.
Section 1.2. COMPANY ACTIONS.
(a) The Company approves of and consents to the Offer and
represents that the Company Board, at a meeting duly called and held, has: (i)
determined that this Agreement, and the transactions contemplated hereby,
including the Offer and the Merger, taken together, are in the best interests of
the Company and its stockholders; (ii) approved this Agreement and the
transactions contemplated hereby, including the Offer and the Merger, in all
respects and such approval constitutes approval of the Offer, this Agreement and
the Merger for purposes of Section 203 of the Delaware General Corporation Law
(the "DGCL"); and (iii) resolved to recommend that the stockholders of the
Company accept the Offer, tender their Shares thereunder to Acquisition and
approve and adopt this Agreement and the Merger subject to the provisions of
Section 5.2(b). The Company consents to the inclusion of such recommendation and
approval in the Offer Documents. The Company also represents that the Company
Board has received the opinion of Deutsche Bank Securities, Inc., financial
advisor to the Company Board (the "FINANCIAL ADVISOR"), that, as of the date of
this Agreement, the consideration to be
3
<PAGE>
received by the holders of Company Common Stock (other than Parent and its
Affiliates) pursuant to this Agreement is fair to such holders from a financial
point of view (the "FAIRNESS OPINION"), a copy of the written opinion of which
will be delivered to Parent after receipt thereof by the Company. The Company
has been authorized by the Financial Advisor to permit, subject to the prior
review and consent by the Financial Advisor (such consent not to be unreasonably
withheld), the inclusion of the Fairness Opinion (or a reference thereto) in the
Offer to Purchase, the Schedule 14D-9 and the Proxy Statement.
(b) The Company will file with the SEC, concurrently with the
filing of the Schedule 14D-1, a Solicitation/Recommendation Statement on
Schedule 14D-9 (together with all amendments and supplements thereto, and
including all exhibits thereto, the "SCHEDULE 14D-9") containing the
recommendations described in Section 1.2(a) and will mail the Schedule 14D-9 to
the stockholders of the Company promptly after the commencement of the Offer.
The Company will cause the Schedule 14D-9 to comply in all material respects
with the Exchange Act and the rules and regulations thereunder and other
Applicable Laws. The Company represents that the Schedule 14D-9, on the date
first published, sent or given to the Company's stockholders, will not 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, except that no representation is made by the Company with respect to
information supplied by Parent or Acquisition in writing specifically for
inclusion or incorporation by reference in the Schedule 14D-9. Parent and
Acquisition represent that the information provided by them specifically in
writing for inclusion or incorporation by reference in the Schedule 14D-9 will
not 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. Each of the Company, Parent and Acquisition agrees promptly to
correct any information provided by it for use in the Schedule 14D-9 or the
Offer Documents if and to the extent that 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 be disseminated to the Company's stockholders, in each case as
and to the extent required by applicable federal securities laws. Parent and its
counsel will be given reasonable opportunity to review and comment on the
Schedule 14D-9 prior to the filing thereof with the SEC. The Company will
provide to Parent and its counsel any comments the Company or its counsel may
receive from the SEC or its staff with respect to the Schedule 14D-9 promptly
after receipt of such comments.
(c) In connection with the Offer, the Company will, or will
cause its transfer agent, promptly following a request by Parent, to furnish
Parent with such information, including updated lists of the stockholders of the
Company, mailing labels and updated lists of security positions, and such
assistance as Parent or its agents reasonably may 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, Parent and Acquisition and their affiliates, associates, agents and
advisors will hold in confidence the information contained in any such labels,
listings and files, will use such information only in connection with the Offer
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and the Merger and, if this Agreement shall be terminated, will promptly
deliver, and will cause their agents to deliver, to the Company all copies and
any extracts or summaries from such information then in their possession or
control.
(d) Solely in connection with the tender and purchase of
Shares pursuant to the Offer and the consummation of the Merger, the Company
hereby waives any and all rights of first refusal it may have with respect to
Shares owned by, or issuable to, any person.
Section 1.3. BOARDS OF DIRECTORS AND COMMITTEES; SECTION 14(f) OF
EXCHANGE ACT.
(a) Promptly upon the purchase by Acquisition of Shares
pursuant to the Offer and from time to time thereafter, if the Minimum Condition
has been met, and subject to the second to last sentence of this Section 1.3(a):
(i) Parent will be entitled to designate up to such number of directors, rounded
up to the next whole number, on the Company Board as will give Parent
representation on the Company Board equal to the product of the number of
directors on the Company Board (giving effect to any increase in the number of
directors pursuant to this Section 1.3) and the percentage that such number of
Shares so purchased bears to the total number of outstanding Shares on a
fully-diluted basis; and (ii) the Company, promptly upon request by Parent, will
use reasonable efforts, at the Company's election, either to increase the size
of the Company Board or secure the resignation of such number of directors as is
necessary to enable Parent's designees to be elected to the Company Board and to
cause Parent's designees to be so elected. At such times, and subject to the
second to last sentence of this Section 1.3(a), the Company will use reasonable
efforts to cause the individuals designated by Parent to constitute the same
percentage as is on the Company Board of (i) each committee of the Company
Board, (ii) each Board of Directors of each subsidiary of the Company (subject
to Applicable Law and except to the extent described in Section 1.3(a) of the
Company Disclosure Schedule) and (iii) each committee of each such Board of
Directors. Notwithstanding the foregoing, the Company shall ensure that three of
the members of the Company Board as of the date hereof (the "CONTINUING
DIRECTORS") who are neither officers of the Company or any of its subsidiaries
nor officers or directors of Acquisition or any of its affiliates shall remain
members of such Board until the Effective Time. If a Continuing Director resigns
from the Company Board, Parent, Acquisition and the Company will permit the
remaining Continuing Director or Directors to appoint the resigning Director's
successor who shall be deemed to be a Continuing Director.
(b) The Company's obligation to appoint designees to the
Company Board shall be subject to Section 14(f) of the Exchange Act and Rule
14f-1 promulgated thereunder. Parent will supply to the Company in writing and
be solely responsible for any information with respect to itself and its
nominees, officers, directors and affiliates required by such Section and Rule.
Subject to the foregoing, the Company promptly will take all action reasonably
required pursuant to such Section and Rule in order to fulfill its obligations
under this Section 1.3 and shall include in the Schedule 14D-9 such information
with respect to the Company and its officers and directors as is required under
such Section and Rule in order to fulfill its obligations under this Section
1.3.
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(c) Following the election or appointment of Parent's
designees to the Company Board pursuant to this Section 1.3 and prior to the
Effective Time, the following shall require the written concurrence of a
majority of the Continuing Directors: (i) any amendment or waiver of any term or
condition of this Agreement or the Certificate of Incorporation or bylaws of the
Company, (ii) any termination of this Agreement by the Company, (iii) any
extension by the Company of the time for the performance of any of the
obligations or other acts of Parent or Acquisition, (iv) any exercise or waiver
of any of the Company's rights or remedies hereunder or (v) any other
determination with respect to any action to be taken or not to be taken by the
Company relating to this Agreement.
ARTICLE 2
THE MERGER
Section 2.1. THE MERGER. At the Effective Time and upon the terms and
subject to the conditions of this Agreement and in accordance with the DGCL,
Acquisition shall be merged with and into the Company (the "MERGER"). Following
the Merger, the Company shall continue as the surviving corporation (the
"SURVIVING CORPORATION") and the separate corporate existence of Acquisition
shall cease. Parent, as the sole stockholder of Acquisition, hereby approves the
Merger and this Agreement.
Section 2.2. EFFECTIVE TIME. Subject to the terms and conditions set
forth in this Agreement, on the Closing Date, (a) a Certificate of Merger (the
"CERTIFICATE OF MERGER") shall be duly executed and acknowledged by Acquisition
and the Company and thereafter delivered for filing to the Secretary of State of
the State of Delaware (the "SECRETARY OF STATE") in such form and manner as
required by the DGCL; and (b) the parties shall make such other filings with any
government office of the State of Delaware as shall be necessary to effect the
Merger. The Merger shall become effective at such time as a properly executed
copy of the Certificate of Merger is duly filed with the Secretary of State in
accordance with the DGCL, or such later time as Parent and the Company may agree
upon and as may be set forth in the Certificate of Merger (the time the Merger
becomes effective being referred to herein as the "EFFECTIVE TIME").
Section 2.3. CLOSING OF THE MERGER. The closing of the Merger (the
"CLOSING") will take place at a time and on a date (the "CLOSING DATE") to be
specified by the parties, which shall be no later than the second business day
after satisfaction (or waiver) of the latest to occur of the conditions set
forth in Article 6, at the offices of Gibson, Dunn & Crutcher LLP, 200 Park
Avenue, New York, New York 10166, unless another time, date or place is agreed
to in writing by the parties hereto.
Section 2.4. EFFECTS OF THE MERGER. The Merger shall have the effects
set forth in the DGCL. Without limiting the generality of the foregoing and
subject thereto, at the Effective Time, all the properties, 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.
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Section 2.5. CERTIFICATE OF INCORPORATION AND BYLAWS. The Certificate
of Incorporation of Acquisition in effect immediately prior to the Effective
Time shall be the Certificate of Incorporation of the Surviving Corporation
until amended in accordance with the provisions thereof and Applicable Law. The
bylaws of Acquisition in effect at the Effective Time shall be the bylaws of the
Surviving Corporation until amended in accordance with the provisions thereof
and Applicable Law.
Section 2.6. DIRECTORS. The directors of Acquisition at the Effective
Time shall be the initial directors of the Surviving Corporation, each to hold
office in accordance with the Certificate of Incorporation and bylaws of the
Surviving Corporation until such director's successor is duly elected or
appointed and qualified.
Section 2.7. OFFICERS. The officers of the Company at the Effective
Time shall be the initial officers of the Surviving Corporation, each to hold
office in accordance with the Certificate of Incorporation and bylaws of the
Surviving Corporation until such officer's successor is duly elected or
appointed and qualified.
Section 2.8. CONVERSION OF SHARES. At the Effective Time, by virtue of
the Merger and without any action on the part of the Acquisition, the Company or
the holder of any of the following securities:
(a) Each Share issued and outstanding immediately prior to the
Effective Time (other than (i) Shares held in the Company's treasury or by any
of the Company's subsidiaries, (ii) Shares held by Parent, Acquisition or any
other subsidiary of Parent and (iii) any Dissenting Shares (as defined in
Section 2.9) shall be canceled and extinguished and be converted into and shall
become the right to receive an amount in cash equal to the Offer Price, payable
to the holder thereof without interest (the "MERGER CONSIDERATION") upon
surrender of the certificate formerly representing such Share.
(b) Each issued and outstanding share of the common stock, par
value $0.01 per share, of Acquisition shall be converted into one fully paid and
non-assessable share of common stock, par value $0.01 per share, of the
Surviving Corporation.
(c) Each Share held in the treasury of the Company and each
Share held by Parent, Acquisition or any subsidiary of Parent, Acquisition or
the Company (other than by Benefit Plans) immediately prior to the Effective
Time shall, be canceled, retired and cease to exist, and no payment or
consideration shall be delivered with respect thereto.
Section 2.9. APPRAISAL RIGHTS. Notwithstanding any provision of this
Agreement to the contrary, each outstanding share of Company Common Stock held
by a holder exercising appraisal rights ("APPRAISAL RIGHTS") with respect to
such shares pursuant to Section 262 of the DGCL, who has not effectively
withdrawn or lost such rights (a "DISSENTING SHARE"), shall not be converted
into or represent a right to receive the Merger Consideration pursuant to this
Article 2, but the holder thereof shall be entitled only to such rights as are
granted by Section 262 of the DGCL; PROVIDED, HOWEVER, that each Dissenting
Share held by a person at the Effective Time who shall, after the Effective
Time, effectively lose such Appraisal Rights or effectively
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withdraw such demand for appraisal or payment of fair market value pursuant to
the DGCL, shall be deemed to be converted, as of the Effective Time, into the
right to receive the Merger Consideration pursuant to this Article 2. The
Company shall give Parent (i) prompt notice and copies of all notices of
dissent, demands for appraisal or payment of fair market value, withdrawals of
demands for appraisal or payment of fair market value, and other instruments
received by the Company relating to the exercise of Appraisal Rights received by
the Company and (ii) the opportunity to direct all negotiations and proceedings
with respect thereto under the DGCL. The Company will not voluntarily make any
payment with respect to any demands for appraisal or payment of fair market
value or settle or offer to settle any such demands.
Section 2.10 EXCHANGE OF CERTIFICATES.
(a) Prior to the Effective Time, Parent shall designate a
bank or trust company of recognized standing and reasonably acceptable to the
Company, to act as paying agent for the holder of Shares (the "EXCHANGE AGENT")
to receive the funds necessary to make the payments contemplated by Section 2.8.
At the Effective Time, Parent shall deliver to the Exchange Agent for the
benefit of the holders of Shares for exchange in accordance with this Article 2,
an amount of cash equal to the aggregate Merger Consideration then payable
pursuant to Section 2.8 (such amount of cash is hereinafter referred to as the
"EXCHANGE FUND"), in exchange for outstanding Shares.
(b) Promptly after the Effective Time, the Exchange Agent
shall mail to each holder of record of a certificate or certificates that
immediately prior to the Effective Time represented outstanding Shares (the
"CERTIFICATES") and whose shares were converted into the right to receive Merger
Consideration pursuant to Section 2.8: (i) a letter of transmittal (which shall
specify that delivery shall be effected and risk of loss and title to the
Certificates shall pass only upon delivery of the Certificates to the Exchange
Agent and shall be in such form and have such other provisions as Parent and the
Company may reasonably specify); and (ii) instructions for use in effecting
surrender of the Certificates in exchange for Merger Consideration. Such letter
of transmittal shall be substantially in the form and substance of a letter of
transmittal and instructions approved by the Company at or before the Closing,
such approval not to be unreasonably withheld. Upon surrender of a Certificate
for cancellation to the Exchange Agent, together with such letter of transmittal
duly executed, the Parent shall cause the Exchange Agent to, as soon as
practicable, pay the holder of such Certificate the Merger Consideration
multiplied by the number of Shares formerly represented by such Certificate, in
consideration therefor, and the Certificate so surrendered shall forthwith be
canceled. In the event of a transfer of ownership of Shares that is not
registered in the transfer records of the Company, the proper amount of Merger
Consideration shall be paid to a transferee if the Certificate representing such
Shares is presented to the Exchange Agent accompanied by all documents required
to evidence and effect such transfer and by evidence that any applicable stock
transfer taxes have been paid. Until surrendered as contemplated by this Section
2.10, each Certificate shall be deemed at any time after the Effective Time to
represent only the right to receive upon such surrender the Merger
Consideration.
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(c) In the event that any Certificate for Shares shall have
been lost, stolen or destroyed, the Exchange Agent shall pay in exchange
therefor upon the making of an affidavit of that fact by the holder thereof the
Merger Consideration; PROVIDED, HOWEVER, that Parent or the Exchange Agent may,
in its discretion, require the delivery of a suitable bond or indemnity.
(d) If, after the Effective Time, Certificates are presented
to the Surviving Corporation for any reason, they shall be canceled in return
for the payment of the aggregate Merger Consideration relating thereto as
provided in this Article 2.
(e) Any portion of the Exchange Fund that remains
undistributed to the stockholders of the Company upon the expiration of 180 days
after the Effective Time shall be delivered to Parent upon demand and any
stockholders of the Company who have not theretofore complied with this Article
2 shall thereafter look only to Parent as general creditors for payment of their
claims for Merger Consideration.
(f) Neither Parent nor Acquisition nor the Company shall be
liable to any holder of Shares for any amount of cash from the Exchange Fund
delivered to a public official pursuant to any applicable abandoned property,
escheat or similar Applicable Law.
Section 2.11. STOCK OPTIONS; SARS.
(a) At or immediately prior to the Effective Time, each then
outstanding Company Stock Option (as defined in Section 3.2) and each then
outstanding stock appreciation right with respect to shares of capital stock of
the Company (in each case, an "SAR"), whether or not then vested or exercisable,
shall be canceled by the Company. In consideration of such cancellation of
Company Stock Options and SARs with an exercise price of less than the Offer
Price, the Company (or, at Parent's option, Acquisition) shall pay to such
holders of Company Stock Options and SARs an amount in respect thereof equal to
the product of (i) the excess of the Offer Price over the exercise price of each
such Company Stock Option or SAR, as applicable, and (ii) the number of Shares
previously subject to such Company Stock Option or SAR, as applicable,
immediately prior to its cancellation (such payment to be net of withholding
taxes and without interest). The amounts payable pursuant to this Section 2.11
shall be paid as soon as practicable following the Closing Date.
(b) The Company shall take all actions necessary or
appropriate so that all stock option, stock appreciation right or other equity
based plans maintained with respect to the Shares (the "COMPANY STOCK PLANS"),
including the Mark VII 1995 Omnibus Stock Incentive Plan, the MNX Incorporated
Amended and Restated 1986 Stock Option Plan, the MNX Incorporated 1992
Non-Qualified Stock Option Plan and the MNX Incorporated Stock Appreciation
Rights Program, shall terminate as of the Effective Time and the provisions in
any other Compensation and Benefit Plan (as defined in Section 3.11(a))
providing for the issuance, transfer or grant of any capital stock of the
Company or any interest in respect of any capital stock of the Company shall be
deleted as of the Effective Time, and the Company shall use its reasonable best
efforts to ensure that following the Effective Time no holder of a Company Stock
Option or any participant in any Company Stock Plan shall have any right
thereunder to acquire any capital stock of the Company, Parent, Acquisition or
the Surviving Corporation.
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(c) Prior to the Effective Time, the Company shall use its
reasonable best efforts to (i) obtain all necessary consents from, and provide
(in a form reasonably acceptable to Parent) any required notices to, holders of
Company Stock Options and SARs and (ii) take all lawful action, as is necessary
to give effect to the provisions of paragraphs (a) and (b) of this Section 2.11.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to each of Parent and Acquisition,
subject to the exceptions set forth in the Disclosure Schedule (the "COMPANY
DISCLOSURE SCHEDULE") delivered by the Company to Parent (which exceptions shall
specifically identify a Section or subsection, as applicable, to which such
exception relates) that:
Section 3.1. ORGANIZATION AND QUALIFICATION; SUBSIDIARIES; INVESTMENTS.
(a) Section 3.1(a) of the Company Disclosure Schedule sets
forth a true and complete list of all the Company's directly and indirectly
owned subsidiaries together with the jurisdiction of incorporation of each
subsidiary. The Company or another subsidiary of the Company owns 100% of each
subsidiary's outstanding capital stock or other equity interests. Each of the
Company and its subsidiaries is duly organized, validly existing and in good
standing under the laws of the jurisdiction of its incorporation or organization
and has all requisite corporate power and authority to own, lease and operate
its properties and to carry on its businesses as now being conducted. The
Company has heretofore made available to Parent accurate and complete copies of
the Certificate of Incorporation and bylaws (or similar governing documents), as
currently in full force and effect, of the Company and each of its subsidiaries.
Except as set forth in Section 3.1(a) of the Company Disclosure Schedule, the
Company has no operating subsidiaries other than those incorporated in a state
of the United States.
(b) The Company and its subsidiaries are duly qualified or
licensed and in good standing to do business in each jurisdiction in which the
property owned, leased or operated by them or the nature of the business
conducted by them makes such qualification or licensing necessary, except in
such jurisdictions where the failure to be so duly qualified or licensed and in
good standing would not, individually or in the aggregate, have a Material
Adverse Effect on the Company. When used in connection with the Company or its
subsidiaries, the term "MATERIAL ADVERSE EFFECT ON THE COMPANY" means any
circumstance, change in, or effect on the Company and its subsidiaries, taken as
a whole, that is, or is reasonably likely in the foreseeable future to be,
materially adverse to the business, financial condition or results of operations
of the Company and its subsidiaries, taken as a whole, provided that none of the
following shall be deemed, either alone or in combination, to constitute a
Material Adverse Effect on the Company: (i) a change in financial market
conditions generally or in the market price or trading volume of the Company
Common Stock; (ii) any change in general economic conditions or conditions
affecting the transportation services industry as a whole; (iii) events
resulting from the public announcement or consummation of the transactions
contemplated by this Agreement; (iv) any
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effect resulting from any change in Applicable Law or generally accepted
accounting principles; or (v) any effect resulting from compliance by the
Company with the terms of this Agreement.
(c) Neither the Company nor any of its subsidiaries has made
an equity investment in an amount of $100,000 or more or that represents a 5% or
greater ownership interest in the subject of such investment in any person other
than the Company's subsidiaries.
Section 3.2. CAPITALIZATION OF THE COMPANY AND ITS SUBSIDIARIES.
(a) The authorized capital stock of the Company consists of
20,000,000 Shares, of which, as of the close of business on July 21, 1999,
10,119,265 Shares were issued and outstanding, including 1,123,750 treasury
Shares. All of the outstanding Shares have been validly issued and are fully
paid, nonassessable and free of preemptive rights. As of the close of business
on July 21, 1999, approximately 2,005,225 Shares were reserved for issuance and,
as of the close of business on July 21, 1999, 1,499,557 were issuable upon or
otherwise deliverable in connection with the exercise of outstanding Company
Stock Options. For purposes hereof, "COMPANY STOCK OPTION" means any option,
warrant or other right to purchase Shares. Between the close of business on July
21, 1999 and the date hereof, no shares of the Company's capital stock have been
issued other than pursuant to Company Stock Options already in existence on such
date and, between the close of business on January 2, 1999 and the date hereof,
no stock options have been granted, except as set forth in Section 3.2(a) of the
Company Disclosure Schedule. Except as set forth above or in Section 3.2(a) of
the Company Disclosure Schedule, as of the date hereof, there are outstanding:
(i) no shares of capital stock or other voting securities of the Company; (ii)
no securities of the Company or any of its subsidiaries convertible into or
exchangeable or exercisable for shares of capital stock or other securities of
the Company; (iii) no options, preemptive or other rights to acquire from the
Company or any of its subsidiaries, and, except as described in the Company SEC
Reports (as defined below), no obligations of the Company or any of its
subsidiaries to issue, any capital stock, voting securities or securities
convertible into or exchangeable or exercisable for capital stock or other
securities of the Company; and (iv) no equity equivalent interests in the
ownership or earnings of the Company or its subsidiaries or other similar rights
(collectively "COMPANY SECURITIES"). As of the date hereof, there are no
outstanding rights or obligations of the Company or any of its subsidiaries to
repurchase, redeem or otherwise acquire any Company Securities. Except as set
forth in Section 3.2(a) of the Company Disclosure Schedule, there are no
stockholder agreements, voting trusts or other agreements or understandings to
which the Company is a party or by which it is bound relating to the voting or
registration of any shares of capital stock of the Company. Pursuant to their
terms, all outstanding Company Stock Options and SARs will automatically vest as
a result of the Offer or the Merger or any other change in control of the
Company.
(b) Except as set forth in Section 3.2(b) of the Company
Disclosure Schedule, all of the outstanding capital stock of the Company's
subsidiaries is owned by the Company, directly or indirectly, free and clear of
any Lien or any other limitation or restriction (including any restriction on
the right to vote or sell the same except as a matter of Applicable Law). Except
as set forth in Section 3.2(b) of the Company Disclosure Schedule, any directors
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qualifying shares issued by a foreign subsidiary of the Company to any director
of such subsidiary are beneficially owned by the Company or another subsidiary
of the Company. Except as set forth in Section 3.2(b) of the Company Disclosure
Schedule, there are no securities of the Company or any of its subsidiaries
convertible into or exchangeable or exercisable for, or other rights to acquire
from the Company or any of its subsidiaries, any capital stock or other
ownership interests in or any other securities of any subsidiary of the Company,
and there exists no other contract, understanding, arrangement or obligation
(whether or not contingent) providing for the issuance or sale, directly or
indirectly, of any such capital stock. Except as set forth in Section 3.2(b) of
the Company Disclosure Schedule, there are no outstanding contractual
obligations of the Company or its subsidiaries to repurchase, redeem or
otherwise acquire any outstanding shares of capital stock or other ownership
interests in any subsidiary of the Company. For purposes of this Agreement,
"LIEN" means, with respect to any asset (including any security), any mortgage,
lien, pledge, charge, security interest or encumbrance of any kind in respect of
such asset; PROVIDED, HOWEVER, that the term "Lien" shall not include (i)
statutory liens for Taxes that are not yet due and payable or are being
contested in good faith by appropriate proceedings and are disclosed in Section
3.13 of the Company Disclosure Schedule, (ii) statutory or common law liens to
secure obligations to landlords, lessors or renters under leases or rental
agreements confined to the premises rented, (iii) deposits or pledges made in
connection with, or to secure payment of, workers' compensation, unemployment
insurance, old age pension or other social security programs mandated by
Applicable Law, (iv) statutory or common law liens in favor of carriers,
warehousemen, mechanics and materialmen, to secure claims for labor, materials
or supplies and other like liens, (v) restrictions on transfer of securities
imposed by applicable state and federal securities laws and (vi) liens,
limitations or restrictions that would not have a Material Adverse Effect on the
Company.
(c) The Shares constitute the only class of equity securities
of the Company or its subsidiaries registered or required to be registered under
the Exchange Act.
Section 3.3. AUTHORITY RELATIVE TO THIS AGREEMENT.
(a) The Company has the requisite corporate power and
authority to execute and deliver this Agreement, to perform its obligations
under this Agreement and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement, and the consummation of the
transactions contemplated hereby, have been duly and validly authorized by the
Company Board, and no other corporate proceedings on the part of the Company are
necessary to authorize this Agreement, or to consummate the transactions
contemplated hereby, except the approval of this Agreement by the holders of a
majority of the outstanding Shares. 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, constitute the valid, legal
and binding agreements of the Company, enforceable against the Company in
accordance with their terms, subject to any applicable bankruptcy, insolvency,
reorganization, moratorium or similar laws now or hereafter in effect relating
to creditors' rights generally or to general principles of equity.
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(b) Without limiting the generality of the foregoing, the
Board of Directors of the Company has unanimously (i) approved this Agreement,
the Offer, the Merger and the other transactions contemplated hereby and (ii)
resolved to recommend approval and adoption of this Agreement, the Merger and
the other transactions contemplated hereby by the Company's stockholders. The
Board of Directors of the Company has not withdrawn or modified such approval or
resolution to recommend.
Section 3.4. SEC REPORTS; FINANCIAL STATEMENTS.
(a) The Company has filed all required forms, reports and
documents (the "COMPANY SEC REPORTS") with the SEC since January 1, 1997, each
of which complied at the time of filing (except to the extent revised or
superseded by a subsequent filing with the SEC prior to the date hereof) in all
material respects with all applicable requirements of the Securities Act of
1933, as amended (the "SECURITIES ACT"), and the Exchange Act except as set
forth in Section 3.4(a) of the Company Disclosure Schedule, such compliance to
be determined, to the extent applicable, in accordance with the standards
applied to the Company SEC Reports in the following two sentences. None of such
Company SEC Reports contained when filed any untrue statement of a material fact
or omitted to state a material fact required to be stated or incorporated by
reference therein or necessary in order to make the statements therein in light
of the circumstances under which they were made not misleading, except to the
extent superseded by a Company SEC Report filed subsequently and prior to the
date hereof. The audited consolidated financial statements of the Company
included in the Company SEC Reports fairly present, in conformity in all
material respects with generally accepted accounting principles applied on a
consistent basis throughout the periods involved (except as may be indicated in
the notes thereto), the consolidated financial position of the Company and its
consolidated subsidiaries as of the dates thereof and their consolidated results
of operations and changes in financial position for the periods then ended.
(b) The Company has made, and hereafter will make, available
to Acquisition or Parent a complete and correct copy of any amendments or
modifications that are required to be filed with the SEC but have not yet been
filed with the SEC to agreements, documents or other instruments that previously
had been filed by the Company with the SEC pursuant to the Exchange Act.
Section 3.5. CONSENTS AND APPROVALS; NO VIOLATIONS. Except for filings,
permits, authorizations, consents and approvals as set forth in Section 3.5 of
the Company Disclosure Schedule or as may be required under applicable
requirements of the Securities Act, the Exchange Act, state securities or blue
sky laws, and the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended (the "HSR ACT") and any filings under similar merger notification laws
or regulations of foreign Governmental Entities and the filing and recordation
of the Certificate of Merger as required by the DGCL, no material filing with or
notice to and no permit, authorization, consent or approval of any United States
(federal, state or local) or foreign court or tribunal, or administrative,
governmental or regulatory body, agency or authority (a "GOVERNMENTAL ENTITY")
is necessary for the execution and delivery by the Company of this Agreement or
the consummation by the Company of the transactions contemplated hereby.
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Neither the execution, delivery and performance of this Agreement by the
Company, nor the consummation by the Company of the transactions contemplated
hereby, will: (a) conflict with or result in any breach of any provision of the
respective Certificate of Incorporation or bylaws (or similar governing
documents) of the Company or any of its subsidiaries; (b) except as set forth in
Section 3.5 of the Company Disclosure Schedule, result in a material violation
or breach of or constitute (with or without due notice or lapse of time or both)
a material default (or give rise to any material right of termination,
amendment, cancellation or acceleration or Lien) under any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, lease, license,
contract, material agreement or other instrument or obligation to which the
Company or any of its subsidiaries is a party or by which any of them or any of
their respective properties and assets is bound; or (c) except as set forth in
Section 3.5 of the Company Disclosure Schedule, violate any material order,
writ, injunction, decree, law, statute, rule or regulation applicable to the
Company or any of its subsidiaries or any of their respective properties or
assets. Section 3.5 of the Company Disclosure Schedule lists all material
consents, waivers and approvals under any of the Company's or any of its
subsidiaries' material agreements, contracts, licenses or leases required to be
obtained in connection with the execution, delivery and performance of this
Agreement by the Company and the consummation by the Company of the transactions
contemplated hereby.
Section 3.6. NO DEFAULT. Except as set forth in Section 3.6 of the
Company Disclosure Schedule, neither the Company nor any of its subsidiaries is
in material breach, default or violation (and no event has occurred that with
notice or the lapse of time or both would constitute a material breach, default
or violation) of any term, condition or provision of (i) its Certificate of
Incorporation or bylaws (or similar governing documents), (ii) any note, bond,
mortgage, indenture, lease, license, contract, agreement or other instrument or
obligation to which the Company or any of its subsidiaries is now a party or by
which it or any of its properties and assets is bound or (iii) any order, writ,
injunction, decree, law, statute, rule or regulation applicable to the Company
or any of its subsidiaries or any of its properties or assets, except, in the
case of clauses (ii) and (iii), such breaches, defaults or violations that would
not have a Material Adverse Effect on the Company.
Section 3.7. NO UNDISCLOSED LIABILITIES; ABSENCE OF CHANGES. Except as
disclosed in the Company SEC Reports or as set forth in Section 3.7 of the
Company Disclosure Schedule, neither the Company nor any of its subsidiaries has
any material liabilities or obligations of any nature, whether or not accrued,
contingent or otherwise, that would be required by generally accepted accounting
principles to be reflected on a consolidated balance sheet of the Company
(including the notes thereto), other than liabilities or obligations incurred
after January 2, 1999 in the ordinary course of business no one or group of
which taken together constitutes a Material Adverse Effect on the Company.
Except as disclosed in the Company SEC Reports or as set forth in Section 3.7 of
the Company Disclosure Schedule, since January 2, 1999, there have been no
events, changes or effects with respect to the Company or its subsidiaries that,
individually or in the aggregate, constitute a Material Adverse Effect on the
Company. Without limiting the generality of the foregoing, except as and to the
extent publicly disclosed in the Company SEC Reports or as set forth in Section
3.7 of the Company Disclosure Schedule, since January 2, 1999 the Company and
its subsidiaries have conducted their respective businesses in all material
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respects only in, and have not engaged in any material transaction other than
according to, the ordinary and usual course of such businesses consistent with
past practices, and there has not been any: (i) declaration, setting aside or
payment of any dividend or other distribution in respect of the capital stock of
the Company or any of its subsidiaries (other than wholly-owned subsidiaries) or
any repurchase, redemption or other acquisition by the Company or any of its
subsidiaries of any outstanding shares of capital stock or other securities of,
or other ownership interests in, the Company or any of its subsidiaries; (ii)
incurrence, assumption or guarantee by the Company or any of its subsidiaries of
any indebtedness for borrowed money other than in the ordinary course of
business and in amounts and on terms consistent with past practices; (iii) loan,
advance or capital contributions made by the Company or any of its subsidiaries
to, or investment in, any person other than (x) loans or advances to employees
in connection with business-related expenses incurred in the ordinary course of
business consistent with past practices and (y) loans made to employees
consistent with past practices that are not in the aggregate in excess of
$100,000; or (iv) change by the Company or any of its subsidiaries in any of its
accounting principles, practices or methods. Since January 2, 1999, except as
disclosed in the Company SEC Reports filed prior to the date hereof or in
Section 3.7 of the Company Disclosure Schedule or increases in the ordinary
course of business consistent with past practices, there has not been any
material increase in the compensation payable or that could become payable by
the Company or any of its subsidiaries to officers of the Company or any of its
subsidiaries or any employee of the Company or any of its subsidiaries whose
aggregate annual cash compensation is $100,000 or more.
Section 3.8. LITIGATION. Except as disclosed in the Company SEC Reports
or as set forth in Section 3.8 of the Company Disclosure Schedule, there is no
suit, claim, action, proceeding or investigation pending or, to the knowledge of
the Company, threatened against the Company or any of its subsidiaries or any of
their respective properties or assets before any Governmental Entity which would
reasonably be expected to result in a Material Adverse Effect on the Company or
prevent or delay the consummation of the transactions contemplated by this
Agreement beyond the Final Date. Except as disclosed in the Company SEC Reports,
neither the Company nor any of its subsidiaries is subject to any outstanding
order, writ, injunction or decree which would reasonably be expected to result
in a Material Adverse Effect on the Company or prevent or delay the consummation
of the transactions contemplated hereby.
Section 3.9. COMPLIANCE WITH APPLICABLE LAW. Except as disclosed in the
Company SEC Reports or as set forth in Section 3.9 of the Company Disclosure
Schedule, the Company and its subsidiaries hold and are in compliance with all
material permits, licenses, variances, exemptions, orders and approvals of all
Governmental Entities necessary for the lawful conduct of their respective
businesses (the "COMPANY PERMITS"), except where the failure to hold or comply
with such Company Permits would not have a Material Adverse Effect on the
Company. Except as disclosed in Section 3.9 of the Company Disclosure Schedule
or in the Company SEC Reports, the businesses of the Company and its
subsidiaries are being conducted in compliance with all Applicable Laws, except
where the failure to so comply would not have a Material Adverse Effect on the
Company. Except as disclosed in the Company SEC Reports, or Section 3.9 of the
Company Disclosure Schedule, to the knowledge of the Company, no investigation
by
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any Governmental Entity with respect to the Company or any of its subsidiaries
is pending or, to the knowledge of the Company, threatened.
Section 3.10. EMPLOYEE BENEFITS.
(a) For purposes of this Agreement, "COMPENSATION AND BENEFIT
PLANS" means, collectively, each written bonus, deferred compensation, pension,
retirement, profit-sharing, thrift, savings, employee stock ownership, stock
bonus, stock purchase, restricted stock, stock option, employment, termination,
severance, compensation, medical, health, or other plan, agreement, policy or
arrangement sponsored, maintained or contributed to by the Company, any of its
subsidiaries or any person that together with the Company and its subsidiaries
is treated as a single employer under Section 414(b), (c), (m) or (o) of the
Code (the Company, its subsidiaries and each such person, a "COMMONLY CONTROLLED
ENTITY"), that covers employees or directors of the Company or any Commonly
Controlled Entity, or pursuant to which former employees or directors of the
Company or any Commonly Controlled Entity are entitled to current or future
benefits. To the knowledge of the Company, except as provided in Section 3.10(a)
and Item 8 of 3.10(j) of the Company Disclosure Schedule, there are no oral
Compensation and Benefit Plans to which the Company or any Commonly Controlled
Entity is a party. The Company has made available to Parent copies of all
Compensation and Benefit Plans, including those that are "employee pension
benefit plans" (as defined in Section 3(2) of the Employee Retirement Income
Security Act of 1974, as amended ("ERISA")) (sometimes referred to herein as
"PENSION PLANS") and "employee welfare benefit plans" (as defined in Section
3(l) of ERISA). The Company has also made available to Parent true, complete and
correct copies of (i) the most recent annual report on Form 5500 filed with the
Internal Revenue Service with respect to each Compensation and Benefit Plan (if
any such report was required), (ii) the most recent summary plan description for
each Compensation and Benefit Plan for which such summary plan description is
required and (iii) each trust agreement and group annuity contract related to
any Compensation and Benefit Plan. Neither the Company nor any Commonly
Controlled Entity maintains or contributes to or has any liability, contingent,
unasserted or otherwise, with respect to a "defined benefit plan" (as defined in
Section 414(j) of the Code). Section 3.10(a) of the Company Disclosure Schedule
sets forth a complete and correct list of all Compensation and Benefit Plans.
(b) Except as otherwise provided in Section 3.10(b) of the
Company Disclosure Schedule and except as would not have a Material Adverse
Effect on the Company, the Company and each Commonly Controlled Entity has
performed in all respects its obligations under each Compensation and Benefit
Plan; each Compensation and Benefit Plan and each trust or other funding medium,
if any, established in connection therewith has at all times been established,
maintained and operated in compliance with its terms and the requirements
prescribed by Applicable Law, including ERISA and the Code.
(c) With respect to those Pension Plans that are intended to
be qualified under Section 401(a) of the Code, except as set forth in Section
3.10(c) of the Company Disclosure Schedule, each such Pension Plan has been the
subject of a determination letter from the Internal Revenue Service to the
effect that such Pension Plans are qualified and exempt from Federal
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income taxes under Sections 401(a) and 501(a), respectively, of the Code, and no
such determination letter has been revoked nor, to the knowledge of the Company,
has any event occurred since the date of its most recent determination letter or
application therefor that would materially adversely affect its qualification or
materially increase its costs.
(d) Neither the Company nor any of its subsidiaries nor any
entity which is under "common control" with the Company (within the meaning of
Section 4001 of ERISA) sponsors, maintains, contributes to or has any liability
with respect to any "multiemployer plan" (as defined in Section 3(37) of ERISA).
(e) Except as disclosed in Section 3.10(e) of the Company
Disclosure Schedule, there are no suits, actions, disputes, claims (other than
routine claims for benefits), arbitrations, administrative or other proceedings
pending or, to the knowledge of Company, threatened, anticipated or expected to
be asserted with respect to any Compensation and Benefits Plan or any related
trust or other funding medium thereunder or with respect to Company or any
Commonly Controlled Entity, as the sponsor or fiduciary thereof or with respect
to any other fiduciary thereof, except as would not have a Material Adverse
Effect on the Company.
(f) No Compensation and Benefit Plan or any related trust or
other funding medium thereunder or any fiduciary thereof is, to the knowledge of
Company, the subject of an audit, investigation or examination by governmental
or quasi-governmental agency, except as would not have a Material Adverse Effect
on the Company.
(g) Except as provided in Section 3.10(g) of the Company
Disclosure Schedule: (i) no "prohibited transaction" (as such term is used in
Section 4975 of the Code and/or Section 406 of ERISA), has occurred with respect
to any Compensation and Benefit Plan primarily for the benefit of participants
employed within the United States; (ii) neither Company nor any Commonly
Controlled Entity has any commitment, intention or understanding to create,
terminate or adopt any Compensation and Benefit Plan that would result in any
additional liability to Parent, the Company or any Commonly Controlled Entity;
and (iii) since the beginning of the current fiscal year of any Compensation and
Benefit Plan, to the knowledge of the Company, no event has occurred and no
condition or circumstance has existed that could result in a material increase
in the benefits under or the expense of maintaining such Compensation and
Benefit Plan maintained by Company and its subsidiaries from the level of
benefits or expense incurred for the most recently completed fiscal year of such
Compensation and Benefit Plan.
(h) Section 3.10(h) of the Company Disclosure Schedule lists
all outstanding Stock Options and SARs, as of the date hereof, identifying for
each such option or SAR: (i) the number of shares subject to such option or SAR,
(ii) the vesting terms, (iii) the date of expiration and (iv) the exercise
price.
(i) All contributions required to be made under the terms of
any Compensation and Benefit Plan as of the date hereof have been timely made or
have been accounted for on the financial statements of the Company or its
subsidiaries in accordance with GAAP.
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(j) Except as provided in Section 3.10(j) of the Company
Disclosure Schedule, the execution of, and performance of the transactions
contemplated by, this Agreement will not (either alone with or upon the
occurrence of any additional or subsequent events) constitute an event under any
Compensation and Benefit Plan or agreement that will or may reasonably be
expected to result in any payment (whether severance pay or otherwise),
acceleration, vesting or increase in benefits with respect to any employee,
former employee or director of the Company, or any Commonly Controlled Entity,
whether or not any such payment would be an "excess parachute payment" (within
the meaning of Section 280G of the Code).
(k) Except as provided in Section 3.10(k) of the Company
Disclosure Schedule, neither the Company nor any Commonly Controlled Entity
sponsors, maintains, contributes to or has any liability, contingent, unasserted
or otherwise with respect to a Compensation and Benefit Plan required to be
maintained or contributed to by the law or applicable custom or rule of the
relevant jurisdiction outside of the United States (the "FOREIGN PLANS").
(l) Except as set forth on Section 3.10(l) of the Company
Disclosure Schedule, Parent, the Surviving Corporation, the Company and any
Commonly Controlled Entity may terminate or amend any Compensation and Benefit
Plan or may cease contributions to any such Compensation and Benefit Plans
without incurring any material liability other than a benefit liability accrued
in accordance with the terms of such Compensation and Benefit Plan immediately
prior to such amendment, termination or ceasing of contributions.
(m) Except as would not have a Material Adverse Effect on
the Company, neither the Company nor any of its subsidiaries has incurred any
liability for any tax, excise tax, penalty or fee with respect to any
Compensation and Benefit Plan, including taxes arising under Sections 4971,
4977, 4978, 4878B, 4979, 4980 or 4980B of the Code, and, to the knowledge of the
Company, no event or circumstance has existed that could give rise to any such
liability.
Section 3.11. LABOR AND EMPLOYMENT MATTERS.
(a) No collective bargaining agreement exists that is binding
on the Company or any of its subsidiaries, and the Company has not been
officially apprised that any petition has been filed or proceeding instituted by
an employee or group of employees of the Company, or any of its subsidiaries,
with the National Labor Relations Board seeking recognition of a bargaining
representative.
(b) To the Company's knowledge, there is no labor strike,
dispute, slow down or stoppage pending or threatened against the Company or any
of its subsidiaries. Neither the Company nor any of its subsidiaries has
received any demand letters, civil rights charges, suits or drafts of suits with
respect to claims made by any of their respective employees.
(c) Except as would not have a Material Adverse Effect on the
Company, all individuals who are performing consulting or other services for the
Company or any of its subsidiaries are or were correctly classified by the
Company as either "independent contractors" or "employees" as the case may be,
and, at the Closing Date, will qualify for such classification.
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(d) Section 3.11(d) of the Company Disclosure Schedule
contains a list of the name of each officer and employee of the Company or any
of the Company's subsidiaries, together with such person's annual base salary or
wages. As of the date hereof, the Company has not received any information that
would lead it to believe that any executive officers will or may cease to be
engaged by the Company or such subsidiary for any reason, including because of
the consummation of the transactions contemplated by this Agreement.
(e) The Company and each of its subsidiaries is in compliance
in all material respects with all applicable foreign, federal, state and local
laws, rules and regulations respecting employment, employment practices, terms
and conditions of employment and wages and hours, in each case, with respect to
employees, except as would not have a Material Adverse Effect on the Company.
(f) The Company and each of its subsidiaries has in all
material respects withheld and reported all amounts required by law or by
agreement to be withheld and reported with respect to wages, salaries and other
payments to employees, except as would not have a Material Adverse Effect on the
Company.
(g) To the Company's knowledge, there are no pending or
threatened claims or actions against the Company or any of its subsidiaries
under any worker's compensation policy or long-term disability policy, except as
would not have a Material Adverse Effect on the Company.
Section 3.12. ENVIRONMENTAL LAWS AND REGULATIONS.
(a) The term "ENVIRONMENTAL LAWS" means any federal, state,
local or foreign law, statute, treaty, ordinance, rule, regulation, permit,
consent, approval, license, judgment, order, decree or injunction, each as
currently in effect and applicable, relating to: (i) Releases (as defined in 42
U.S.C. sec. 9601(22)) or threatened Releases of Hazardous Material (as
hereinafter defined) into the environment; (ii) the generation, treatment,
storage, disposal, use, handling, manufacturing, transportation or shipment of
Hazardous Material; (iii) the health or safety of employees in the workplace;
(iv) protecting or restoring natural resources; or (e) the environment. The term
"HAZARDOUS MATERIAL" means: (1) hazardous substances (as defined in 42 U.S.C.
sec. 9601(14)), including "hazardous waste" as defined in 42 U.S.C. sec. 6903;
(2) petroleum, including crude oil and any fractions thereof; (3) natural gas,
synthetic gas and any mixtures thereof; (4) asbestos and/or asbestos containing
materials; (5) PCBs or materials containing PCBs; (6) any material regulated as
a medical waste; (7) radioactive materials; and (8) "Hazardous Substance" or
"Hazardous Material" as those terms are defined in any indemnification provision
in any contract, lease, or agreement to which the Company or any of its
subsidiaries is a party.
(b) Except as disclosed in Schedule 3.12(b), during the
period of ownership or operation by the Company and its subsidiaries of any of
their current or previously owned or leased properties, there have been no
Releases of Hazardous Material by the Company or any of its subsidiaries in, on,
under or affecting such properties or any surrounding site, and neither the
Company nor any of its subsidiaries has disposed of any Hazardous Material in a
manner that has
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led, or could reasonably be expected to lead, to a Release, except in each case
for those Releases which, individually or in the aggregate, would not reasonably
be expected to have a Material Adverse Effect on the Company. Except as
disclosed in Schedule 3.12(b), there have been no Releases of Hazardous Material
by the Company or any of its subsidiaries in, on, under or affecting their
current or previously owned or leased properties or any surrounding site at
times outside of such periods of ownership, operation or lease, except in each
case for those Releases which, individually on in the aggregate, would not
reasonably be expected to have a Material Adverse Effect on the Company. Except
as disclosed in Schedule 3.12(b), since January 1, 1995, neither the Company nor
any of its subsidiaries has received any written notice of, or entered into any
order, settlement or decree relating to: (i) any violation of any Environmental
Laws by the Company or any of its subsidiaries or the institution or pendency of
any suit, action, claim, proceeding or investigation by any Governmental Entity
or any third party against the Company or any of its subsidiaries in connection
with any alleged violation of Environmental Laws by the Company of any of its
subsidiaries; or (ii) the response to or remediation of Hazardous Material at or
arising from any of the Company's properties or any subsidiary's properties
except for such notices, orders, settlements, decrees, violations or responses
to or remediations of Hazardous Materials as would not reasonably be expected to
have a Material Adverse Effect on the Company. Except as disclosed on Schedule
3.12(b), there have been no violations of any Environmental Laws by the Company
or any subsidiary which, individually or in the aggregate, would reasonably be
expected to have a Material Adverse Effect on the Company.
Section 3.13. TAXES.
(a) DEFINITIONS. For purposes of this Agreement:
(i) the term "CODE" means the Internal Revenue Code
of 1986, as amended;
(ii) the term "TAX" (including "TAXES") means: (1)
all federal, state, local, foreign and other net income, gross income,
gross receipts, sales, use, ad valorem, transfer, franchise, profits,
license, lease, service, service use, withholding, payroll, employment,
excise, severance, stamp, occupation, premium, property, windfall
profits, customs, duties or other taxes, fees, assessments or charges
of any similar kind imposed by a taxing authority, whether disputed or
not, together with any interest and any penalties, additions to tax or
additional amounts with respect thereto; (2) any liability for payment
of amounts described in clause (1) whether as a result of transferee
liability, of being a member of an affiliated, consolidated, combined
or unitary group for any period, or otherwise through operation of law;
and (3) any liability for the payment of amounts described in clauses
(1) or (2) as a result of any tax sharing, tax indemnity or tax
allocation agreement or any other express or implied agreement to
indemnify any other person; and
(iii) the term "TAX RETURN" means any return,
declaration, report, statement, information statement or other document
filed or required to be filed with respect to Taxes.
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(b) Except as set forth in Section 3.13(b) of the Company
Disclosure Schedule, the Company and its subsidiaries have timely filed all
material Tax Returns required to be filed and such Tax Returns are complete and
accurate in all material respects. Such Tax Returns do not contain a disclosure
statement under Section 6662 of the Code (or any predecessor provision or
comparable provision of state, local or foreign law).
(c) Except as set forth in Section 3.13(c) of the Company
Disclosure Schedule, the Company and its subsidiaries have paid or adequately
provided in the financial statements included in the SEC Reports for all
material Taxes accrued through the date of such Company SEC Reports. All
material Taxes the Company and its subsidiaries accrued since January 2, 1999
have been accrued in the ordinary course of business of the Company and each
such subsidiary and have been paid when due in the ordinary course of business.
No material election has been made with respect to Taxes of the Company or its
subsidiaries in any Tax Returns filed since January 1, 1995 that has not been
made available to Parent.
(d) Except as set forth in Section 3.13(d) of the Company
Disclosure Schedule, no material claim for assessment or collection of Taxes is
being asserted against the Company or its subsidiaries and neither the Company
nor any of its subsidiaries is a party to any pending action, proceeding or
investigation by any governmental taxing authority nor does the Company have
knowledge of any such threatened action, proceeding or investigation.
(e) Except as set forth in Section 3.13(e) of the Company
Disclosure Schedule, neither the Company nor any of its subsidiaries is a party
to any agreement, contract, arrangement or plan that has resulted or would
result, individually or in the aggregate, in connection with this Agreement or
any change of control of the Company or any of its subsidiaries, in the payment
of any "excess parachute payments" within the meaning of Section 280G of the
Code.
(f) Except as set forth in Section 3.13(f) of the Company
Disclosure Schedule, neither the Company nor any of its subsidiaries is a party
to or bound by any obligation under any Tax sharing, Tax allocation, Tax
indemnity or similar agreement or arrangement.
(g) Except as set forth in Section 3.13(g) of the Company
Disclosure Schedule, there is currently no limitation on the utilization of net
operating losses, built-in losses, tax credits or other similar items of the
Company or its subsidiaries under Section 382, 383, 384 or 1502 of the Code and
the Treasury Regulations thereunder.
(h) Except as set forth in Section 3.13(h) of the Company
Disclosure Schedule, neither the Company nor any of its subsidiaries has agreed
to, or is required to make, any adjustment under Section 481 of the Code by
reason of a change in accounting method.
(i) Neither the Company nor any of its subsidiaries are
"consenting corporations" within the meaning of Section 341(f)(1) of the Code.
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Section 3.14. INTELLECTUAL PROPERTY.
(a) The Company and its subsidiaries own, license or
otherwise have the right to use all (i) patents, trademarks and copyrights, (ii)
applications or registrations for patents, trademarks and copyrights, and (iii)
trade secrets including but not limited to know-how, processes, methods,
technology, software and databases, that are necessary to conduct the business
of the Company and its subsidiaries as currently conducted (collectively, the
"INTELLECTUAL PROPERTY"), except where the failure to own or license such
Intellectual Property would not have a Material Adverse Effect on the Company.
(b) Neither the Company nor any of its subsidiaries is, or
will as a result of the execution and delivery of this Agreement or the
performance of the Company's obligations under this Agreement be, in breach of
or default under any license, sublicense or other agreement or arrangement
relating to the Intellectual Property, or any licenses, sublicenses or other
agreements or arrangements to which the Company or any of its subsidiaries is a
party and is authorized to use any patents, trademarks, copyrights or trade
secrets of any other party, except where such breach or default would not
reasonably be expected to have a Material Adverse Effect on the Company.
(c) Neither the Company nor its subsidiaries has been named in
any suit, action or proceeding which involves a claim of infringement of any
rights relating to any patent, trademark or copyright of any party or the
misappropriation of any party's trade secrets, nor to the Company's knowledge,
has any such suit, action or proceeding been threatened. To the Company's
knowledge, the services of the Company and its subsidiaries do not infringe any
patent, trademark or copyright of any party or misappropriate the trade secrets
of any party.
Section 3.15. INSURANCE. Except as set forth in Section 3.15 of the
Company Disclosure Schedule, all material insurance policies (the "INSURANCE
POLICIES") maintained by the Company and its Subsidiaries are in full force and
effect, and all premiums due thereon have been paid in full. Each of the Company
and its subsidiaries has complied in all material respects with the provisions
of each Insurance Policy under which it is the insured party. Except as set
forth in Section 3.15 of the Company Disclosure Schedule, no insurer under any
Insurance Policy has canceled or generally disclaimed liability under any such
policy or, to the Company's knowledge, indicated any intent to do so or not to
renew any such policy. All material claims under the Insurance Policies have
been filed in a timely fashion. In the judgment of the Company, such Insurance
Policies, with respect to their amounts and types of coverage, are adequate to
insure against risks to which the Company and its Subsidiaries are normally
exposed in the operation of their business.
Section 3.16. CERTAIN BUSINESS PRACTICES. None of the Company, any of
its subsidiaries or, to the Company's knowledge, any directors, officers or
employees of the Company or any of its subsidiaries has (i) used any funds for
unlawful contributions, gifts, entertainment or other unlawful expenses related
to political activity, (ii) made any unlawful payment to foreign or domestic
government officials or employees or to foreign or domestic political parties or
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campaigns or violated any provision of the Foreign Corrupt Practices Act of
1977, as amended, or (iii) made any other unlawful payment.
Section 3.17. SUPPLIERS AND CUSTOMERS. Section 3.17 of the Company
Disclosure Schedule sets forth the names of the 20 largest customers of the
Company and its subsidiaries during the six month period ended July 3, 1999.
Since April 3, 1999, the Company has received no notices of termination or
written threats of termination from any of such customers of the Company and its
subsidiaries.
Section 3.18. VOTE REQUIRED. The affirmative vote of the holders of
a majority of the votes cast by the holders of Shares at a duly constituted
meeting with a quorum present is the only vote of the holders of any class or
series of the Company's capital stock necessary to approve and adopt this
Agreement and the Merger.
Section 3.19. BROKERS. No broker, finder or investment banker
(other than the Financial Advisor, a true and correct copy of whose engagement
agreement has been provided to Parent) 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.
Section 3.20. TAKEOVER STATUTES. No "fair price," "moratorium,"
"control share acquisition" or other similar anti-takeover statute or regulation
under the laws of the State of Delaware (each a "TAKEOVER STATUTE") is
applicable to the Company, the Shares, the Offer, the Merger or any of the other
transactions contemplated by this Agreement. The Company Board has approved the
Offer, the Merger, this Agreement, and such approval is sufficient to render
inapplicable to the Offer, the Merger, this Agreement and the transactions
contemplated by this Agreement and the provisions of Section 203 of the DGCL to
the extent, if any, such Section is applicable to the Offer, the Merger, this
Agreement or any of the transactions contemplated by this Agreement. The Company
does not have any shareholder rights plan or "poison pill" arrangement in
effect.
Section 3.21. YEAR 2000 CAPABILITY. To the knowledge of the Company,
the software, operations, systems and processes (including, to the knowledge of
the Company, software, operations, systems and processes obtained from third
parties) which, in whole or in part, are used, operated, relied upon, or
integral to, the Company's or any of its Subsidiaries, conduct of their
business, are Year 2000 Compliant (as hereinafter defined), except as disclosed
in the Company SEC Reports filed and publicly available prior to the date of
this Agreement or where the failure to be Year 2000 Compliant would not,
individually or in the aggregate, have a Material Adverse Effect. For purposes
of this Agreement, "YEAR 2000 COMPLIANT" means the ability to process (including
calculate, compare, sequence, display or store), transmit or receive data or
data/time data from, into and between the twentieth and twenty-first centuries,
and the years 1999 and 2000, and leap year calculations without error or
malfunction.
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ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF
PARENT AND ACQUISITION
Parent and Acquisition, jointly and severally, hereby represent and
warrant to the Company as follows:
Section 4.1. ORGANIZATION.
(a) Each of Parent and Acquisition is duly organized,
validly existing and in good standing under the laws of the State of New York
and the State of Delaware, respectively, and has all requisite power and
authority and any necessary governmental authority and approvals to own, lease
and operate its properties and to carry on its business as now being conducted.
Parent has heretofore made available to the Company accurate and complete copies
of the Certificates of Incorporation and bylaws, as currently in full force and
effect, of Parent and Acquisition. Parent owns all of the issued and outstanding
capital stock of Acquisition.
(b) Each of Parent and Acquisition is duly qualified or
licensed and in good standing to do business in each jurisdiction in which the
property owned, leased or operated by it or the nature of the business conducted
by it makes such qualification or licensing necessary, except in such
jurisdictions where the failure to be so duly qualified or licensed and in good
standing would not have a Material Adverse Effect on Parent. When used in
connection with Parent or Acquisition the term "MATERIAL ADVERSE EFFECT ON
PARENT" means any circumstance, change in or effect on (or circumstance, change
in, or effect involving a prospective change on) Parent and its subsidiaries,
taken as a whole, that will, or is reasonably likely in the foreseeable future
to materially and adversely affect the ability of Parent and Acquisition to
consummate the Offer or the Merger.
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, to perform its obligations under this Agreement and to
consummate the transactions contemplated hereby. The execution and delivery of
this Agreement and the consummation of the transactions contemplated hereby have
been duly and validly authorized by the boards of directors of Parent and
Acquisition and by Parent as the sole stockholder of 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 each of
Parent and Acquisition and constitutes, assuming the due authorization,
execution and delivery hereof by the Company, a valid, legal and binding
agreement of each of Parent and Acquisition enforceable against each of Parent
and Acquisition in accordance with its terms, subject to any applicable
bankruptcy, insolvency, reorganization, moratorium or similar laws now or
hereafter in effect relating to creditors' rights generally or to general
principles of equity.
Section 4.3. CONSENTS AND APPROVALS; NO VIOLATIONS. Except for
filings, permits, authorizations, consents and approvals as may be required
under and other applicable
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requirements of the Securities Act, the Exchange Act, state securities or blue
sky laws, the HSR Act, and any filings under similar merger notification laws or
regulations of foreign Governmental Entities and the filing and recordation of
the Certificate of Merger as required by the DGCL, no filing with or notice to,
and no permit, authorization, consent or approval of, any Governmental Entity is
necessary for the execution and delivery by Parent or Acquisition of this
Agreement or the consummation by Parent or Acquisition of the transactions
contemplated hereby. Neither the execution, delivery and performance of this
Agreement by Parent or Acquisition nor the consummation by Parent or Acquisition
of the transactions contemplated hereby will (a) conflict with or result in any
breach of any provision of the respective Certificates of Incorporation or
bylaws (or similar governing documents) of Parent or Acquisition, (b) result in
a violation or breach of or constitute (with or without due notice or lapse of
time or both) a default (or give rise to any right of termination, amendment,
cancellation or acceleration or Lien) under any of the terms, conditions or
provisions of any note, bond, mortgage, indenture, lease, license, contract,
agreement or other instrument or obligation to which Parent or Acquisition or
any of Parent's other subsidiaries is a party or by which any of them or any of
their respective properties and assets is bound or (c) violate any material
order, writ, injunction, decree, law, statute, rule or regulation applicable to
Parent or Acquisition or any of Parent's other subsidiaries or any of their
respective properties or assets.
Section 4.4. LITIGATION. There is no suit, claim, action, proceeding or
investigation pending or, to the knowledge of Parent threatened, against Parent
or any of its subsidiaries or any of their respective properties or assets
before any Governmental Entity that could reasonably be expected to prevent or
delay the consummation of the transactions contemplated by this Agreement beyond
the Final Date. Neither Parent nor any of its subsidiaries is subject to any
outstanding order, writ, injunction or decree that could reasonably be expected
to prevent or delay the consummation of the transactions contemplated hereby.
Section 4.5. BROKERS. No broker finder or investment banker, other
than Merrill Lynch & Co., 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 Parent or Acquisition.
Section 4.6. FINANCING. At the expiration of the Offer and at the
Effective Time, Parent and Acquisition will have available all the funds
necessary for the acquisition of all Shares and to perform their respective
obligations under this Agreement, including the payment in full for all Shares
validly tendered or outstanding as of the Effective Time.
Section 4.7. OPERATIONS OF ACQUISITION. Acquisition has been
formed solely for the purpose of engaging in the transactions contemplated
hereby and prior to the Effective Time will have engaged in no other business
activities and will have incurred no liabilities or obligations other than as
contemplated hereby.
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ARTICLE 5
COVENANTS
Section 5.1. CONDUCT OF BUSINESS OF THE COMPANY. Except as
contemplated by this Agreement or as described in Section 5.1 of the Company
Disclosure Schedule, during the period from the date hereof until the date
Parent's designees constitute a majority of the Company Board, the Company will
and will cause each of its subsidiaries to use commercially reasonable efforts
to (a) conduct its operations in the ordinary course of business consistent with
past practice and with no less diligence and effort than would be applied in the
absence of this Agreement and (b) preserve intact its current business
organizations, keep available the service of its current key officers and
employees and preserve its relationships with key customers, suppliers, lessors,
creditors, employees, contractors and others having business dealings with it
with the intention that its goodwill and ongoing businesses shall not be
materially adversely impaired at the Effective Time. Without limiting the
generality of the foregoing, except as otherwise expressly provided in this
Agreement or in Section 5.1 of the Company Disclosure Schedule, prior to the
date Parent's designees constitute a majority of the Company Board, neither the
Company nor any of its subsidiaries, without the prior written consent of Parent
(which consent shall not be unreasonably withheld), will:
(a) amend its Certificate of Incorporation or bylaws (or other
similar governing instrument);
(b) authorize for issuance, issue, sell, deliver or agree
or commit to issue, sell or deliver (whether through the issuance or granting of
options, warrants, commitments, subscriptions, rights to purchase or otherwise)
any stock of any class or any other debt or equity securities or equity
equivalents (including any stock options or stock appreciation rights) except
for the issuance and sale of Shares pursuant to Company Stock Options
outstanding on the date hereof;
(c) split, combine or reclassify any shares of its capital
stock, declare, set aside or pay any dividend or other distribution (whether in
cash, stock or property or any combination thereof) in respect of its capital
stock, make any other actual, constructive or deemed distribution in respect of
its capital stock or otherwise make any payment to stockholders in their
capacity as such, or redeem or otherwise acquire any of its securities or any
securities of any of its subsidiaries, except as may be required on the date
hereof under the terms of any Company Stock Option or SAR;
(d) adopt a plan of complete or partial liquidation,
dissolution, merger, consolidation, restructuring, recapitalization or other
reorganization of the Company or any of its subsidiaries (other than the
Merger);
(e) alter through merger, liquidation, reorganization,
restructuring or any other fashion the corporate structure of any material
subsidiary (other than as a result of the transactions contemplated by this
Agreement);
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(f) (i) incur or assume any long-term or short-term debt or
issue any debt securities except, in each case, for borrowings under existing
lines of credit in the ordinary course of business consistent with past
practice, or modify or agree to any material amendment of the terms of any of
the foregoing; (ii) assume, guarantee, endorse or otherwise become liable or
responsible (whether directly, contingently or otherwise) for the obligations of
any other person except for obligations of subsidiaries of the Company incurred
in the ordinary course of business consistent with past practice, other than
third-party guarantees and lease agreements not to exceed $250,000 in the
aggregate; (iii) make any loans, advances or capital contributions to or
investments in any other person (other than to subsidiaries of the Company or
customary loans or advances to employees in each case in the ordinary course of
business consistent with past practice); (iv) pledge or otherwise subject to any
Lien shares of capital stock of the Company or any of its subsidiaries; or (v)
mortgage or pledge any of its material assets, tangible or intangible, or create
or suffer to exist any material Lien thereupon;
(g) except as may be required by Applicable Law or any
policy, plan, agreement or arrangement in effect as of the date hereof, enter
into, adopt or amend or terminate any bonus, special remuneration, profit
sharing, compensation, severance, termination, stock option, stock appreciation
right, restricted stock, performance unit, stock equivalent, stock purchase
agreement, pension, retirement, deferred compensation, employment, health, life
or disability insurance, dependent care, severance or other employee benefit
plan, agreement, trust, fund or other arrangement for the benefit or welfare of
any director, officer, employee or consultant or materially increase the
compensation or fringe benefits of any director, officer or employee or pay any
benefit not required by any plan and arrangement as in effect as of the date
hereof (including the granting of stock appreciation rights or performance
units);
(h) except as may be required by Applicable Law, grant any
severance or termination pay to any director, officer, employee or consultant,
except payments made pursuant to written agreements outstanding on the date
hereof or the current severance policies of the Company described on Section
3.10(a) of the Company Disclosure Schedule;
(i) except as provided in any policy, plan, agreement or other
arrangement in effect as of the date hereof, accelerate the vesting of any
Company Stock Option as a result of the Merger, any other "change in control" of
the Company or otherwise;
(j) (i) sell, lease, license, transfer or otherwise dispose of
any material assets in any single transaction or series of related transactions
(including in any transaction or series of related transactions having a fair
market value in excess of $250,000 in the aggregate) or (ii) enter into any
exclusive license, distribution, marketing, sales or other agreement other than
in the ordinary course of business;
(k) except as may be required as a result of a change in law
or in generally accepted accounting principles, change any of the accounting
principles, practices or methods used by it;
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(l) revalue in any material respect any of its assets,
including writing-off notes or accounts receivable, other than in the ordinary
course of business consistent with past practice or as required by generally
accepted accounting principles;
(m) (i) acquire (by merger, consolidation or acquisition
of stock or assets) any corporation, partnership or other person or division
thereof or any material equity interest therein; (ii) enter into any contract or
agreement that would be material to the Company and its subsidiaries, taken as a
whole; (iii) amend, modify or waive any material right under any material
contract of the Company or any of its subsidiaries; (iv) modify its standard
warranty or contract terms for its services or amend or modify any warranties or
contract terms in effect as of the date hereof in any material manner that is
adverse to the Company or any of its subsidiaries; (v) authorize any new capital
expenditure or expenditures that in the aggregate are in excess of $250,000; or
(vi) acquire any asset or related group of assets, or make any investment, in a
single transaction or series of related transactions, with a cost in excess of
$250,000;
(n) make any material tax election or settle or compromise any
material income tax liability or permit any insurance policy naming it as a
beneficiary or loss-payee to expire, or to be canceled or terminated, unless a
comparable insurance policy reasonably acceptable to Parent is obtained and in
effect;
(o) fail to file any material Tax Returns when due (or,
alternatively, fail to file for available extensions) or fail to cause such Tax
Returns when filed to be complete and accurate in all material respects;
(p) fail to pay any material Taxes or other material debts
when due;
(q) settle or compromise any pending or threatened suit,
action or claim that (i) relates to the transactions contemplated hereby or (ii)
the settlement or compromise of which would involve more than $250,000 or that
would otherwise have a Material Adverse Effect on the Company; or
(r) take or agree in writing or otherwise to take any of
the actions described in Sections 5.1(a) through 5.1(q) or any action that would
make any of the representations or warranties of the Company contained in this
Agreement to be untrue or incorrect in any material respect.
Section 5.2. NO SOLICITATION OR NEGOTIATION.
(a) The Company, its subsidiaries and other affiliates and
heir respective officers and other employees, directors, representatives
(including the Financial Advisor or any other investment banker and any
attorneys and accountants) and agents shall immediately cease any discussions or
negotiations with any other persons with respect to any Third Party Acquisition.
Neither the Company nor any of its subsidiaries and other affiliates shall, nor
shall the Company authorize or permit any of its or their respective officers,
directors, employees, representatives or agents to, directly or indirectly,
encourage, solicit, participate in or initiate discussions or negotiations with
or provide any information to any person or group (other than
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Parent and Acquisition or any designees of Parent and Acquisition) concerning
any Third Party Acquisition; PROVIDED, HOWEVER, that if the Company Board
determines in good faith, after consultation with outside legal counsel of
national reputation, that it is necessary to do so in order to comply with its
fiduciary duties to the Company's stockholders under applicable Delaware law,
the Company may, in response to a proposal or offer for a Third Party
Acquisition that was not solicited and that the Company Board determines, after
consultation with the Company Financial Advisor, is from a Third Party that is
capable of consummating a Superior Proposal and only for so long as the Company
Board so determines that its actions are likely to lead to a Superior Proposal,
(i) furnish information with respect to the Company to any such person pursuant
to a customary confidentiality agreement so long as any information so provided
which has not previously been provided by the Company to Parent will be promptly
delivered to Parent and (ii) participate in the discussions and negotiations
regarding such proposal or offer. The Company promptly (and in any event within
one business day after becoming aware thereof) will (i) notify Parent in the
event the Company or any of its subsidiaries and other affiliates or any of
their respective officers, directors, employees and agents receives any proposal
or inquiry concerning a Third Party Acquisition, including the material terms
and conditions thereof, and any request for confidential information in
connection with a potential Third Party Acquisition, (ii) provide a copy of any
written agreements, proposals or other materials the Company receives from any
such person or group (or its representatives), and (iii) advise Parent of the
status, at any time upon Parent's request, and from time to time promptly
following any material developments concerning the same.
(b) Except as set forth in this Section 5.2(b), the Company
Board shall not withdraw or modify its recommendation of the transactions
contemplated hereby or approve or recommend, or cause or permit the Company to
enter into any agreement or obligation with respect to, any Third Party
Acquisition. Notwithstanding the foregoing, if the Company Board by a majority
vote determines in its good faith judgment, after consultation with and after
receiving the advice of outside legal counsel of national reputation, that it is
required to do so in order to comply with its fiduciary duties, the Company
Board may withdraw its recommendation of the transactions contemplated hereby or
approve or recommend a Superior Proposal, but in each case only (i) after
providing written notice to Parent (a "NOTICE OF SUPERIOR PROPOSAL") advising
Parent that the Company Board has received a Superior Proposal, specifying the
material terms and conditions of such Superior Proposal and identifying the
person or group making such Superior Proposal and (ii) if Parent does not,
within 48 hours after Parent's receipt of the Notice of Superior Proposal, make
an offer that the Company Board by a majority vote determines in its good faith
judgment (after consultation with the Financial Advisor or another financial
advisor of nationally recognized reputation) to be at least as favorable to the
Company's stockholders as such Superior Proposal; PROVIDED, HOWEVER, that the
Company shall not be entitled to enter into any agreement with respect to a
Superior Proposal unless and until this Agreement is terminated pursuant to
Section 7.1 and the Company has paid any amounts due to Parent pursuant to
Section 7.3. Any disclosure that the Company Board may be compelled to make with
respect to the receipt of a proposal for a Third Party Acquisition or otherwise
in order to comply with its fiduciary duties or Rule 14d-9 or 14e-2 will not
constitute a violation of this Agreement; PROVIDED, HOWEVER, that such
disclosure states that no action will be taken by the Company Board in violation
of this Section 5.2(b).
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(c) For purposes of this Agreement, "THIRD PARTY ACQUISITION"
means the occurrence of any of the following events: (i) the acquisition of the
Company by merger or otherwise by any person (which includes a "person" as such
term is defined in Section 13(d)(3) of the Exchange Act) other than Parent,
Acquisition or any affiliate thereof (a "THIRD PARTY"); (ii) the acquisition by
a Third Party of any material portion (which shall include 20% or more) of the
assets of the Company and its subsidiaries, taken as a whole; or (iii) the
acquisition by a Third Party who beneficially owns 20% or more of the
outstanding Shares as of the date of this Agreement of an additional 5% or more
of the outstanding Shares or the acquisition by any other Third Party of 20% or
more of the outstanding Shares. For purposes of this Agreement, a "SUPERIOR
PROPOSAL" means any BONA FIDE proposal (1) to acquire, directly or indirectly,
for consideration consisting solely of cash and/or securities, all of the Shares
then outstanding, or all or substantially all the assets, of the Company; (2)
for which there is no financing contingency and which contains terms that the
Company Board determines in its good faith judgment (after consultation with, as
to the financial terms, the Financial Advisor or another financial advisor of
nationally recognized reputation to be more favorable to the Company's
stockholders than the Offer and the Merger; (3) that the Company Board
determines in its good faith judgment (following consultation with the Financial
Advisor or another financial advisor of nationally recognized reputation and its
legal and other advisors) to be likely to be completed (taking into account all
legal, financial, regulatory and other aspects of the proposal; (4) that does
not contain a "right of first refusal" or "right of first offer" with respect to
any counter-proposal that Parent might make; and (5) that is not subject to
satisfactory diligence by the person making the proposal.
(d) Nothing contained in this Section 5.2 shall prohibit the
Company from taking and disclosing to its stockholders a position contemplated
by Rules 14d-9 and 14e-2 promulgated under the Exchange Act or from making any
disclosure to the Company's stockholders if, in the good faith judgment of the
Company Board, after consultation with outside counsel, such disclosure is
required to comply with its fiduciary duties to the Company's stockholders under
applicable Delaware law.
Section 5.3. MEETING OF STOCKHOLDERS.
(a) In the event that Parent acquires less than 90% of the
outstanding Shares, the Company, following the acceptance for payment of Shares
by Acquisition pursuant to the Offer, will take all actions necessary in
accordance with the DGCL and its Certificate of Incorporation and bylaws to
call, give notice of, convene and hold a meeting of its stockholders as promptly
as practicable to consider and vote upon the adoption and approval of this
Agreement and the transactions contemplated hereby (the "MEETING"). The
stockholder vote required for the adoption and approval of the transactions
contemplated by this Agreement shall be the vote required by the DGCL and the
Company's Certificate of Incorporation and bylaws. The Company, through the
Company Board, will recommend to its stockholders approval of such matters
subject to the provisions of Section 5.2(b). The Company, as promptly as
reasonably practicable after payment for the tendered Shares by Acquisition
pursuant to the Offer, will prepare and file with the SEC the Proxy Statement
for the solicitation of a vote of the holders of Shares approving the Merger,
which, subject to the provisions of Section 5.2(b), shall
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include the recommendation of the Company Board that stockholders of the Company
vote in favor of the approval and adoption of this Agreement and the written
opinion of the Financial Advisor referred to in Section 1.2. The Company shall
use all reasonable efforts to have the Proxy Statement cleared by the SEC as
promptly as practicable after such filing, and promptly thereafter mail the
Proxy Statement to the stockholders of the Company. Whenever any event occurs
which is required to be set forth in an amendment or supplement to the Proxy
Statement, the Company will promptly inform Parent of such occurrence and
cooperate in filing with the SEC or its staff or any other government officials,
and/or mailing to stockholders of the Company, such amendment or supplement. The
Company may adjourn or postpone (i) the Meeting to the extent necessary to
ensure that any necessary supplement or amendment to the Proxy Statement is
provided to the Company's stockholders in advance of a vote on the Merger and
this Agreement or (ii) the time for which the Meeting is originally scheduled
(as set forth in the Proxy Statement), if there are insufficient Shares
represented, either in person or by proxy, to constitute a quorum necessary to
conduct the business of the Meeting. Notwithstanding the foregoing, if Parent,
Acquisition and/or any other subsidiary of Parent shall acquire at least 90% of
the outstanding Shares, the parties shall take all necessary and appropriate
action to cause the Merger to become effective as soon as practicable after the
expiration of the Offer without a Meeting in accordance with Section 253 of the
DGCL.
(b) Each of Parent and Acquisition agrees to vote in favor of
the Merger all Shares purchased pursuant to the Offer and all other Shares owned
by Parent or any other subsidiary of Parent.
Section 5.4. ACCESS TO INFORMATION; CONFIDENTIALITY.
(a) Between the date hereof and the Effective Time, upon
reasonable notice and subject in each instance to the requirements of Applicable
Law, the Company will give Parent and its authorized representatives reasonable
access to all employees, plants, offices, warehouses and other facilities and to
all books and records and personnel files of current employees of the Company
and its subsidiaries as Parent reasonably may require, and will cause its
officers and those of its subsidiaries to furnish Parent with such financial and
operating data and other information with respect to the business and properties
of the Company and its subsidiaries as Parent may from time to time reasonably
request.
(b) Each of Parent and Acquisition will hold and treat, and
will cause their respective officers, employees, auditors and other agents and
representatives ("REPRESENTATIVES") to hold and treat, in confidence all
information concerning the Company and its subsidiaries furnished to Parent,
Acquisition or such Representatives in connection with the transactions
contemplated by this Agreement in accordance with the Confidentiality Agreement,
dated July 8, 1999, between the Company and Parent, which Confidentiality
Agreement shall remain in full force and effect in accordance with its terms.
Section 5.5. CERTAIN FILINGS; REASONABLE EFFORTS.
(a) Subject to the terms and conditions hereof, including
Section 5.2(b), the parties will use all reasonable efforts to take or cause to
be taken all action and to do or cause to
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be done all things reasonably necessary, proper or advisable under Applicable
Law to consummate and make effective the transactions contemplated by this
Agreement, including using all reasonable efforts to do the following: (i)
cooperate in the preparation and filing of the Proxy Statement and any
amendments thereto, any filings that may be required under the HSR Act and any
filings under similar merger notification laws or regulations of foreign
Governmental Entities; (ii) obtain consents of all third parties and
Governmental Entities necessary, proper, advisable or reasonably requested by
Parent or the Company, for the consummation of the transactions contemplated by
this Agreement; (iii) contest any legal proceeding relating to the Merger; and
(iv) execute any additional instruments necessary to consummate the transactions
contemplated hereby. Subject to the terms and conditions of this Agreement,
Parent and Acquisition will use all reasonable efforts to cause the Effective
Time to occur as soon as practicable after the Company stockholder vote with
respect to the Merger or the purchase by Acquisition of 90% or more of the
outstanding Shares pursuant to the Offer. If at any time after the Effective
Time any further action is necessary to carry out the purposes of this Agreement
the proper officers and directors of each party will take all such action as may
be reasonably required.
(b) Parent and the Company will consult and cooperate with one
another, and consider in good faith the views of one another, in connection with
any analyses, appearances, presentations, letters, white papers, memoranda,
briefs, arguments, opinions or proposals made or submitted by or on behalf of
any party hereto in connection with proceedings under or relating to the HSR Act
or any other foreign, federal, or state antitrust, competition, or fair trade
law. In this regard, each party hereto shall promptly inform the other of any
material communication between such party and the Federal Trade Commission, the
Antitrust Division of the United States Department of Justice, or any other
federal, foreign or state antitrust or competition Governmental Entity regarding
the transactions contemplated herein.
Section 5.6. PUBLIC ANNOUNCEMENTS. None of Parent, Acquisition or the
Company will issue any press release or otherwise make any public statements
with respect to the transactions contemplated by this Agreement, including the
Merger, or any Third Party Acquisition, without the prior consent of Parent and
Acquisition (in the case of the Company) or the Company (in the case of Parent
or Acquisition) which in either case will not unreasonably be withheld, except:
(i) as may be required by Applicable Law or by the rules and regulations of, or
pursuant to any agreement with, the Nasdaq National Market; or (ii) following a
change, if any, of the Company Board's recommendation of the Merger (in
accordance with Section 5.2(b)); or (iii) only in the case of a release or
statement relating to a Third Party Acquisition, if the Company Board has been
advised by outside legal counsel that a press release or other public statement
is required by Applicable Law.
Section 5.7. INDEMNIFICATION AND DIRECTORS' AND OFFICERS' INSURANCE.
(a) From and after the Effective Time, Parent shall cause
the Surviving Corporation to indemnify, defend and hold harmless (and to advance
expenses as incurred to the fullest extent permitted under Applicable Law to)
each person who is now or has been prior to the date hereof or who becomes prior
to the Effective Time an officer or director of the Company
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or any of the Company's subsidiaries (the "INDEMNIFIED PERSONS") against: (i)
all losses, claims, damages, costs, expenses (including counsel fees and
expenses), settlement, payments or liabilities arising out of or in connection
with any claim, demand, action, suit, proceeding or investigation based in whole
or in part on or arising in whole or in part out of the fact that such person is
or was an officer or director of the Company or any of its subsidiaries, whether
or not pertaining to any matter existing or occurring at or prior to the
Effective Time and whether or not asserted or claimed prior to or at or after
the Effective Time ("INDEMNIFIED LIABILITIES"); and (ii) all Indemnified
Liabilities based in whole or in part on or arising in whole or in part out of
or pertaining to this Agreement or the transactions contemplated hereby, in each
case to the fullest extent required or permitted under Applicable Law. Nothing
contained herein shall make Parent, Acquisition, the Company or the Surviving
Corporation, an insurer, a co-insurer or an excess insurer in respect of any
insurance policies which may provide coverage for Indemnified Liabilities, nor
shall this Section 5.7 relieve the obligations of any insurer in respect
thereto. The parties hereto intend, to the extent not prohibited by Applicable
Law, that the indemnification provided for in this Section 5.7 shall apply
without limitation to negligent acts or omissions by an Indemnified Person. This
Section 5.7 shall not limit or otherwise adversely affect any rights any
Indemnified Person may have under any agreement with the Company or under the
Company's Certificate of Incorporation or bylaws as currently in effect.
(b) From and after the Effective Time, Parent will cause the
Surviving Corporation to fulfill the obligations of the Company pursuant to any
indemnification agreements between the Company and its directors and officers as
of or prior to the date hereof and to keep in effect any indemnification
provisions under the Company's certificate of incorporation or bylaws as in
effect immediately prior to the Effective Time.
(c) For a period of six years after the Effective Time,
Parent will maintain or cause the Surviving Corporation to maintain in effect,
at no expense to the beneficiaries, directors' and officers' liability insurance
covering those persons who, as of immediately prior to the Effective Time, are
covered by the Company's directors' and officers' liability insurance policy
(the "INSURED PARTIES") on terms no less favorable to the Insured Parties than
those of the Company's current directors' and officers' liability insurance
policy; PROVIDED, HOWEVER, that in no event shall Parent or the Company be
required to expend on an annual basis in excess of 150% of the annual premium
currently paid by the Company for such coverage (the "MAXIMUM PREMIUM"). If the
Surviving Corporation is unable to obtain the insurance required by this Section
5.7(c) for the Maximum Premium, it shall obtain as much comparable insurance as
possible for an annual premium equal to the Maximum Premium. In lieu of
maintaining such existing insurance, Parent, at its election, may cause coverage
to be provided under any policy maintained for the benefit of Parent or any of
its subsidiaries, so long as the terms are not materially less advantageous to
the intended beneficiaries thereof than such existing insurance. In the event
any claim is made against present or former directors, officers or employees of
the Company that is covered or potentially covered by insurance, neither the
Surviving Corporation nor Parent shall do anything that would forfeit,
jeopardize, restrict or limit the insurance coverage available for that claim
until final disposition thereof.
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(d) Notwithstanding anything herein to the contrary, if any
claim, action, suit, proceeding or investigation (whether arising before, at or
after the Effective Time) is made against any Indemnified Persons, on or prior
to the sixth anniversary of the Effective Time, the provisions of this Section
5.7 shall continue in effect until the final disposition of such claim, action,
suit, proceeding or investigation.
(e) This covenant is intended to be for the benefit of, and
shall be enforceable by, each of the Indemnified Persons and their respective
heirs and legal representatives. The indemnification provided for herein shall
not be deemed exclusive of any other rights to which an Indemnified Person is
entitled, whether pursuant to law, contract or otherwise. Parent shall pay all
reasonable expenses, including attorneys' fees, that may be incurred by any
Indemnified Person in enforcing the indemnity and other obligations provided for
in this Section 5.7.
(f) In the event that the Surviving Corporation or Parent or
any of their respective successors or assigns (i) consolidates with or merges
into any other person and shall not be the continuing or surviving corporation
or entity of such consolidation or merger or (ii) transfers or conveys all or
substantially all of its properties and assets to any person, then, and in each
such case, to the extent necessary to effectuate the purposes of this Section
5.7, proper provision shall be made so that the successors and assigns of the
Surviving Corporation or Parent shall succeed to the obligations set forth in
this Section 5.7 and none of the actions described in clauses (i) or (ii) shall
be taken until such provision is made.
Section 5.8. NOTIFICATION OF CERTAIN MATTERS. The Company will give
prompt notice to Parent, and Parent will give prompt notice to the Company, of
(i) the occurrence or nonoccurrence of any event the occurrence or nonoccurrence
of which has caused or would be likely to cause any representation or warranty
contained in this Agreement by such party to be untrue or inaccurate in any
material respect at or prior to the Effective Time and (ii) any material failure
by such party to comply with or satisfy in any material respect any covenant,
condition or agreement to be complied with or satisfied by it hereunder. The
delivery of any notice pursuant to this Section 5.8 shall not cure such breach
or non-compliance or limit or otherwise affect the remedies available hereunder
to the party receiving such notice.
Section 5.9. TAKEOVER STATUTES. If any Takeover Statute or any similar
statute, law, rule or regulation in any State of the United States (including
under the DGCL or any other law of the State of Delaware) is or becomes
applicable to the Offer, the Merger or any of the other transactions
contemplated by this Agreement, Parent, the Company and the Company Board
promptly will grant such approvals and use all reasonable efforts to take such
lawful actions as are necessary so that such transactions may be consummated as
promptly as practicable on the terms contemplated by this Agreement or by the
Offer or the Merger, as the case may be, and use all reasonable efforts to take
such lawful actions to eliminate or minimize the effects of such statute, law,
rule or regulation, on such transactions.
Section 5.10. COMPANY STOCK OPTIONS.
(a) From and after the date hereof, the Company will not take
any action that would prevent or is inconsistent with the provisions of Section
2.11.
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(b) From and after the date hereof, the Company will not
include in any restricted stock grant or grant of a Company Stock Option in
connection with an offer of employment for a new employee any change of control
provisions and any such grant will not be in an amount of shares in excess of
such grants made to new employees in the ordinary course of business, consistent
with past practice.
(c) From and after the date hereof, the Company will not
include in any restricted stock grant or grant of a Company Stock Option granted
to a continuing employee after July 27, 1999 any change in control provisions,
will not be in an amount of shares in excess of such grants made to continuing
employees in the ordinary course of business, consistent with past practice. The
aggregate number of shares covered by all such grants will not exceed 50,000.
(d) The Company agrees to cause the Company Board to adopt all
resolutions reasonably necessary or appropriate to further the purposes of
Sections 5.13(a), (b) and (c) and provide that all options outstanding under
each Company Stock Plan can be canceled by Parent.
Section 5.11. COMPANY INFORMATION SUPPLIED. None of the information
supplied or to be supplied by the Company for inclusion or incorporation by
reference in the proxy statement relating to the meeting of the Company's
stockholders to be held in connection with the Merger (the "PROXY STATEMENT")
will, at the date mailed to stockholders of the Company and at the time of the
meeting of stockholders of the Company to be held in connection with the Merger,
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 Proxy Statement insofar as it relates to the meeting of the Company's
stockholders to vote on the Merger will comply as to form in all material
respects with the provisions of the Exchange Act and the rules and regulations
thereunder. Notwithstanding the foregoing, the Company makes no representation,
warranty or covenant with respect to any information supplied or required to be
supplied by Parent or Acquisition that is contained in or omitted from the Proxy
Statement.
Section 5.12. PARENT AND ACQUISITION INFORMATION SUPPLIED. None of the
information supplied or to be supplied by Parent or Acquisition for inclusion or
incorporation by reference in the Offer Documents and the Proxy Statement will
at the date mailed to stockholders and at the times of the meeting or meetings
of stockholders of the Company to be held in connection with the Merger 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 and any amendments or supplements thereto will comply as to
form in all material respects with the provisions of the Exchange Act and the
rules and regulations thereunder. Notwithstanding the foregoing, neither Parent
nor Acquisition makes any representation, warranty or covenant with respect to
any information supplied or required to be supplied by the Company that is
contained in or omitted from the Proxy Statement.
Section 5.13. SUPPORT LETTER. Parent will furnish the Company a
letter from Ocean Group plc, a company organized under the laws of England and
Wales ("OCEAN GROUP"), within
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<PAGE>
ten business days of the date hereof, which letter states that Ocean Group will
provide sufficient funds to Parent and Acquisition so that Parent and
Acquisition can (i) pay for tendered Shares, (ii) pay for Shares exchanged in
the Merger and (iii) make payments required under Section 2.11.
Section 5.14. EMPLOYEES AND EMPLOYEE BENEFITS.
(a) Effective as of the Closing, Parent shall cause the Company to
employ all persons employed by the Company immediately prior to the earlier of
the Closing or the time Parent designates directors to the Company Board
pursuant to Section 1.3(a) hereof (the "COMPANY EMPLOYEES"). For a period of two
years following the Closing, Parent shall provide or cause to be provided to the
Company Employees employee pension and welfare benefits plans (the "PARENT
PLANS") that are substantially comparable in the aggregate to the employee
pension and welfare benefit plans provided to the Company Employees immediately
prior to the earlier of the Closing or the time Parent designates directors to
the Company Board pursuant to Section 1.3(a) hereof (the "COMPANY PLANS").
(b) Following the Closing, Parent shall cause the Parent Plans (i)
to recognize all prior service of the Company Employees for purposes of
participation, eligibility and vesting of benefits (but not for benefit accrual
purposes), (ii) to take into account all expenses incurred by the Company
Employees (or their eligible dependents) prior to the Closing toward satisfying
deductible, coinsurance and out-of-pocket expense limits, and (iii) to waive any
preexisting condition limitations that would otherwise apply to the Company
Employees; PROVIDED, HOWEVER, that the foregoing shall apply only as and to the
extent such prior service or expenses incurred were recognized for a Company
Employee, or such preexisting condition limitation did not apply to a Company
Employee, under the comparable Company Plan as of the Closing Date.
ARTICLE 6
CONDITIONS TO CONSUMMATION OF THE MERGER
Section 6.1. CONDITIONS TO EACH PARTY'S OBLIGATIONS TO EFFECT THE
MERGER. The respective obligations of each party hereto to effect the Merger are
subject to the satisfaction at or prior to the Effective Time of the following
conditions:
(a) this Agreement shall have been approved and adopted by the
requisite vote of the stockholders of the Company, if required by Applicable
Law;
(b) no statute, rule, regulation, executive order, decree,
ruling or injunction shall have been enacted, entered, promulgated or enforced
by any United States federal or state court or United States federal or state
Governmental Entity that prohibits, restrains, enjoins or restricts the
consummation of the Merger; and
(c) Acquisition shall have purchased Shares pursuant to the
Offer.
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ARTICLE 7
TERMINATION; AMENDMENT; WAIVER
Section 7.1. TERMINATION. This Agreement may be terminated and the
Merger may be abandoned at any time prior to the Effective Time notwithstanding
approval thereof by the Company's stockholders:
(a) by mutual written consent of Parent, Acquisition and the
Company;
(b) by Parent and Acquisition or the Company if: (i) any
court of competent jurisdiction in the United States or other United States
federal or state Governmental Entity shall have issued a final order, decree or
ruling, or taken any other final action, restraining, enjoining or otherwise
prohibiting the Merger and such order, decree, ruling or other action is or
shall have become nonappealable; or (ii) the Merger has not been consummated by
March 31, 2000 (the "FINAL DATE"); PROVIDED, HOWEVER, that no party may
terminate this Agreement pursuant to this clause (ii) if such party's failure to
fulfill any of its obligations under this Agreement shall have been a principal
reason that the Effective Time shall not have occurred on or before said date;
(c) by Parent and Acquisition if, due to an occurrence or
circumstance that would result in a failure to satisfy any of the conditions set
forth in Annex A, Acquisition shall have (i) terminated the Offer in accordance
with the provisions of Annex A or (ii) failed to pay for Shares pursuant to the
Offer within 120 days following the date hereof, unless such failure to pay for
Shares is a result of the failure of Parent or Acquisition to perform any of its
covenants and agreements contained in this Agreement;
(d) by the Company if: (i)(A) Acquisition fails to commence
the Offer as provided in Section 1.1 or (B) Acquisition fails to pay for Shares
pursuant to the Offer within 120 days following the date hereof, unless such
failure to pay for Shares is the result of (1) the failure of the Company to
perform any of its covenants and agreements contained in this Agreement or (2)
termination of the Offer in accordance with the provisions of Annex A; or (ii)
the Company Board has received a Superior Proposal and has complied with the
provisions of Section 5.2; or
(e) by Parent and Acquisition if (i) the Company shall have
materially breached its obligations set forth in Section 5.2, (ii) the Company
Board shall have recommended to the Company's stockholders a Superior Proposal,
(iii) the Company Board shall have withdrawn or adversely modified (including by
amendment of the Schedule 14D-9) its approval or recommendation of this
Agreement, the Offer or the Merger or (iv) the Minimum Condition shall not have
been satisfied by the expiration date of the Offer and on or prior to such date
(A) any person (other than Parent or Acquisition) shall have made and not
withdrawn a bona fide proposal or public announcement or commitment to the
Company with respect to a Third Party Acquisition or (B) any person (including
the Company or any of its affiliates or subsidiaries), other than Parent or
Acquisition shall have become the beneficial owner of 25% of the Shares.
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<PAGE>
Section 7.2. EFFECT OF TERMINATION. In the event of the termination of
this Agreement pursuant to Section 7.1, this Agreement shall forthwith become
void and have no effect without any liability on the part of any party hereto or
its affiliates, directors, officers or stockholders other than as provided in
this Section 7.2 and Sections 7.3 and 8.1; provided, however, that nothing
herein shall relieve any party from any liability for any breach hereof. Nothing
set forth herein shall limit any rights any party may have arising out of the
intentional fraudulent conduct of any other party hereto.
Section 7.3. FEES AND EXPENSES.
(a) If any of the following occur (each, a "TERMINATION FEE
EVENT"):
(i) Parent and Acquisition terminate this
Agreement pursuant to Section 7.1(e),
(ii) Parent and Acquisition terminate this
Agreement pursuant to Section 7.1(c) in
connection with a willful act or omission by
the Company which results in a failure to
satisfy any of the conditions set forth in
Annex A,
(iii) the Company terminates this Agreement
pursuant to Section 7.1(d)(ii), or
(iv) the Company terminates this Agreement
pursuant to Section 7.1(d)(i)(B) at a time
when Parent and Acquisition had a right to
terminate this Agreement pursuant to Section
7.1(e),
then:
(x) in the event of a Termination Fee Event
described inSection 7.3(a)(ii), the Company
shall pay Parent a fee of $1,000,000
immediately upon such termination,
(y) in the event of a Termination Fee Event
described in Section 7.3(a)(i), Section
7.3(a)(iii) or Section 7.3(a)(iv), the
Company will pay Parent a fee (as a
condition and prior to such Termination Fee
Event if such event is a termination by the
Company and within one business day of such
termination if such event is a termination
by Parent or Acquisition) of $2,500,000 and
an additional fee of $2,500,000 immediately
upon the signing within 12 months of such
termination of any agreement with respect to
a Third Party Acquisition or the
consummation of a Third Party Acquisition
without the signing of any such agreement
during such period, and
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<PAGE>
(z) in the event of a Termination Fee Event
described in Section 7.3(a)(ii), the Company
shall pay Parent a fee of $5,000,000 (which
fee shall be reduced by the amount, if any,
paid to Parent pursuant to clause (x) above)
immediately upon the signing within 12
months of such termination of any agreement
with respect to a Third Party Acquisition or
the consummation of a Third Party
Acquisition without the signing of any such
agreement during such period.
(b) The Company acknowledges that Parent and Acquisition
would suffer direct and substantial damages, which damages cannot be determined
with reasonable certainty in the event that this Agreement shall be terminated
pursuant to a Termination Fee Event. It is specifically agreed that the amount
to be paid pursuant to Section 7.3(a) represents liquidated damages and not a
penalty. The Company waives any right to set-off or counterclaim against such
amount.
(c) Upon termination of this Agreement pursuant to
Section 7.1(c), Section 7.1(d)(ii) or Section 7.1(e), in addition to any other
remedies that Parent, Acquisition or their affiliates may have as a result of
such termination (including pursuant to Section 7.3(a) or otherwise), the
Company shall reimburse Parent the amount of $500,000 as reimbursement for the
out-of-pocket costs, fees and expenses incurred by any of them or on their
behalf in connection with this Agreement, the Offer, the Merger and the
consummation of the transactions contemplated by this Agreement (including fees
payable to investment bankers, counsel to any of the foregoing and accountants).
Nothing contained in this Section 7.3(c) shall relieve any party of any
liability for breach of this Agreement.
(d) Upon termination of this Agreement pursuant to
Section 7.1(d)(i), in addition to any other remedies that the Company or its
affiliates may have as a result of such termination, Parent shall reimburse the
Company the amount of $500,000 as reimbursement for the out-of-pocket costs,
fees and expenses incurred by any of them or on their behalf in connection with
this Agreement, the Offer, the Merger and the consummation of the transactions
contemplated by this Agreement (including fees payable to investment bankers,
counsel to any of the foregoing and accountants). Nothing contained in this
Section 7.3(d) shall relieve any party of any liability for breach of this
Agreement.
(e) Except as specifically provided in this Section 7.3, each
party shall bear its own expenses in connection with this
Agreement and the transactions contemplated hereby.
(f) The parties acknowledge that the agreements contained in
this Article 7 (including this Section 7.3) are an integral part of the
transactions contemplated by this Agreement and that, without these agreements,
the parties would not enter into this Agreement. Accordingly, if any party fails
promptly to pay the amounts required pursuant to Section 7.3 when due (including
circumstances where, in order to obtain such payment a party commences a suit
that results in a final nonappealable judgment against another party for such
amounts), the defaulting party shall pay to the other party (i) its costs and
expenses (including attorneys' fees)
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<PAGE>
in connection with such suit and (ii) interest on the amount that was determined
to be due and payable hereunder at the rate announced by The Chase Manhattan
Bank as its "reference rate" in effect on the date such payment was required to
be made.
Section 7.4. AMENDMENT. This Agreement may be amended by action taken
by the Company, Parent and Acquisition at any time before or after approval of
the Merger by the stockholders of the Company, but after any such approval no
amendment may be made that requires the approval of such stockholders under
Applicable Law without such approval. This Agreement may be amended only by an
instrument in writing signed on behalf of the parties hereto.
Section 7.5. EXTENSION; WAIVER. At any time prior to the Effective
Time, each party hereto may (i) extend the time for the performance of any of
the obligations or other acts of the other party, (ii) waive any inaccuracies in
the representations and warranties of the other party contained herein or in any
document, certificate or writing delivered pursuant hereto or (iii) waive
compliance by the other party with any of the agreements or conditions contained
herein. Any agreement on the part of any party hereto to any such extension or
waiver shall be valid only if set forth in an instrument, in writing, signed on
behalf of such party. The failure of any party hereto to assert any of its
rights hereunder shall not constitute a waiver of such rights.
ARTICLE 8
MISCELLANEOUS
Section 8.1. NONSURVIVAL OF REPRESENTATIONS AND WARRANTIES. The
representations and warranties made herein shall not survive beyond the
Effective Time. This Section 8.1 shall not limit any covenant or agreement of
the parties hereto that by its terms requires performance after the Effective
Time.
Section 8.2. ENTIRE AGREEMENT; ASSIGNMENT. This Agreement (including
the Company Disclosure Schedule and Annex A, which are incorporated by reference
into this Agreement (a) constitute the entire agreement between the parties
hereto with respect to the subject matter hereof and supersede all other prior
and contemporaneous agreements and understandings both written and oral between
the parties with respect to the subject matter hereof and (b) shall not be
assigned by operation of law or otherwise; PROVIDED, HOWEVER, that Acquisition
may assign any or all of its rights and obligations under this Agreement to any
wholly owned subsidiary of Parent, but no such assignment shall relieve
Acquisition of its obligations hereunder if such assignee does not perform such
obligations.
Section 8.3. VALIDITY. If any provision of this Agreement or the
application thereof to any person or circumstance is held invalid or
unenforceable, the remainder of this Agreement and the application of such
provision to other persons or circumstances shall not be affected thereby and to
such end the provisions of this Agreement are agreed to be severable.
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<PAGE>
Section 8.4. NOTICES. All notices and other communications pursuant to
this Agreement shall be in writing and shall be deemed given if delivered
personally, telecopied, sent by nationally-recognized overnight courier or
mailed by registered or certified mail (return receipt requested), postage
prepaid, to the parties at the addresses set forth below or to such other
address as the party to whom notice is to be given may have furnished to the
other parties hereto in writing in accordance herewith. Any such notice or
communication shall be deemed to have been delivered and received (i) in the
case of personal delivery, on the date of such delivery, (ii) in the case of
telecopier, on the date sent if confirmation of receipt is received and such
notice is also promptly mailed by registered or certified mail (return receipt
requested), (iii) in the case of a nationally-recognized overnight courier in
circumstances under which such courier guarantees next business day delivery, on
the next business day after the date when sent and (iv) in the case of mailing,
on the third business day following that on which the piece of mail containing
such communication is posted:
<TABLE>
<S> <C>
if to Parent or Acquisition: c/o Ocean Group plc
Ocean House
The Ring
Bracknell
Berkshire RG12 1AW
England
Telecopier: 011 44 134 44 452222
Attention: Group Commercial Director
with a copy to: Gibson, Dunn & Crutcher LLP
200 Park Avenue
New York, New York 10166
Telecopier: (212) 351-4035
Attention: Steven R. Finley
if to the Company to: Mark VII, Inc.
965 Ridge Lake Boulevard, Suite 100
Memphis, Tennessee 38120
Telecopier: (901) 767-1929
Attention: General Counsel
with a copy to: Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10019
Telecopier: (212) 259-6333
Attention: Robert M. Smith
Denise A. Cerasani
</TABLE>
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above.
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<PAGE>
Section 8.5. GOVERNING LAW AND VENUE; WAIVER OF JURY TRIAL.
(a) THIS AGREEMENT SHALL BE DEEMED TO BE MADE IN AND IN
ALL RESPECTS SHALL BE INTERPRETED, CONSTRUED AND GOVERNED BY AND IN ACCORDANCE
WITH THE LAW OF THE STATE OF DELAWARE WITHOUT REGARD TO THE CONFLICT OF LAW
PRINCIPLES THEREOF. The parties hereby irrevocably submit to the jurisdiction of
the courts of the State of Delaware and the Federal courts of the United States
of America located in the State of Delaware solely in respect of the
interpretation and enforcement of the provisions of this Agreement and of the
documents referred to in this Agreement, and in respect of the transactions
contemplated hereby, and hereby waive, and agree not to assert, as a defense in
any action, suit or proceeding for the interpretation or enforcement hereof or
of any such document, that it is not subject thereto or that such action, suit
or proceeding may not be brought or is not maintainable in said courts or that
the venue thereof may not be appropriate or that this Agreement or any such
document may not be enforced in or by such courts, and the parties hereto
irrevocably agree that all claims with respect to such action or proceeding
shall be heard and determined in such a Delaware state or Federal court. The
parties hereby consent to and grant any such court jurisdiction over the person
of such parties and over the subject matter of such dispute and agree that
mailing of process or other papers in connection with any such action or
proceeding in the manner provided in Section 8.4 or in such other manner as may
be permitted by Applicable Law, shall be valid and sufficient service thereof.
(b) The parties agree that irreparable damage would occur
and that the parties would not have any adequate remedy at law in the event that
any of the provisions of this Agreement were not performed in accordance with
their specific terms or were otherwise breached. It is accordingly agreed that
the parties shall be entitled to an injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
of this Agreement in any Federal court located in the State of Delaware or in
Delaware state court, this being in addition to any other remedy to which they
are entitled at law or in equity.
(c) EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY
WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND
DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO
THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY
CERTIFIES AND ACKNOWLEDGES THAT: (i) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER; (ii) EACH
SUCH PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER; (iii)
EACH SUCH PARTY MAKES THIS WAIVER VOLUNTARILY; AND (iv) EACH SUCH PARTY HAS BEEN
INDUCED TO ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE WAIVERS AND
CERTIFICATIONS IN THIS SECTION 8.5.
Section 8.6. DESCRIPTIVE HEADINGS; ARTICLE AND SECTION REFERENCES. The
descriptive headings herein are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or interpretation of
this Agreement. All Article, Section, Schedule and
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<PAGE>
Annex references in this Agreement are to Articles, Sections, Schedules and
Annexes, respectively, of or to this Agreement unless specified otherwise.
Section 8.7. PARTIES IN INTEREST. This Agreement shall be binding upon
and inure solely to the benefit of each party hereto and its successors and
permitted assigns and, except as expressly provided herein, nothing in this
Agreement is intended to or shall confer upon any other person any rights,
benefits or remedies of any nature whatsoever under or by reason of this
Agreement.
Section 8.8. CERTAIN DEFINITIONS. For the purposes of this Agreement
the term:
(a) "AFFILIATE" 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.
(b) "APPLICABLE LAW" means, with respect to any person, any
domestic or foreign, federal, state or local statute, law, ordinance, rule,
regulation, order, writ, injunction, judgment, decree or other requirement of
any Governmental Entity existing as of the date hereof or as of the Effective
Time applicable to such Person or any of its respective properties, assets,
officers, directors, employees, consultants or agents.
(c) "BUSINESS DAY" means any day other than a day on which the
Nasdaq National Market is closed.
(d) "CAPITAL STOCK" means common stock, preferred stock,
partnership interests, limited liability company interests or other ownership
interests entitling the holder thereof to vote with respect to matters involving
the issuer thereof.
(e) "KNOWLEDGE" or "KNOWN" means, with respect to any
matter in question, the actual knowledge of such matter of any executive officer
of the Company or any of its subsidiaries, or Parent or any of its subsidiaries,
as the case may be.
(f) "INCLUDE" or "INCLUDING" means "include, without
limitation" or "including, without limitation," as the case may be, and the
language following "include" or "including" shall not be deemed to set forth an
exhaustive list.
(g) "PERSON" means an individual, corporation, partnership,
limited liability company, association, trust, unincorporated organization or
other legal entity including any Governmental Entity.
(h) "SUBSIDIARY" or "SUBSIDIARIES" of the Company, Parent, the
Surviving Corporation or any other person means any corporation, partnership,
limited liability company, association, trust, unincorporated association or
other legal entity of which the Company, Parent, the Surviving Corporation or
any such other person, as the case may be (either alone or through or together
with any other subsidiary), owns, directly or indirectly, 50% or more of the
capital stock 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.
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<PAGE>
Section 8.9. PERSONAL LIABILITY. This Agreement shall not create or be
deemed to create or permit any personal liability or obligation on the part of
any direct or indirect stockholder of the Company or Parent or Acquisition or
any officer, director, employee, agent, representative or investor of any party
hereto.
Section 8.10. SPECIFIC PERFORMANCE. The parties hereby acknowledge that
the failure of any party to perform its agreements and covenants hereunder,
including its failure to take all actions as are necessary on its part to the
consummation of the Offer or the Merger, will cause irreparable injury to the
other parties, for which damages, even if available, will not be an adequate
remedy. Accordingly, each party hereby consents to the issuance of injunctive
relief by any court of competent jurisdiction to compel performance of such
party's obligations and to the granting by any court of the remedy of specific
performance of its obligations hereunder; PROVIDED, HOWEVER, that if a party
hereto is entitled to receive any payment or reimbursement of expenses pursuant
to Section 7.3(a), (b) or (c), it shall not be entitled to specific performance
to compel the consummation of the Offer or the Merger.
Section 8.11. COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original but all of
which shall constitute one and the same agreement.
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<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
duly executed on its behalf as of the day and year first above written.
MARK VII, INC.,
a Delaware corporation
By: /s/ R. C. Matney
-------------------------
Name: R. C. Matney
Title: Chairman and CEO
MSAS GLOBAL LOGISTICS INC.,
a New York corporation
By: /s/ Mick P. Fountain
-------------------------
Name: Mick P. Fountain
Title: Regional Chief Executive
MSAS ACQUISITION CORPORATION,
a Delaware corporation
By: /s/ Stuart A. Young
-------------------------
Name: Stuart A. Young
Title: Secretary
[SIGNATURE PAGE TO AGREEMENT AND PLAN OF MERGER BY AND AMONG MARK VII, INC.,
MSAS GLOBAL LOGISTICS INC. AND MSAS ACQUISITION CORPORATION]
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<PAGE>
ANNEX A
CONDITIONS OF THE OFFER
Notwithstanding any other provision of the Offer or this Agreement, and
subject to any applicable rules and regulations of the SEC, including Rule
14e-1(c) relating to Acquisition's obligation to pay for or return tendered
shares promptly after termination of the Offer, Acquisition shall not be
required to accept for payment or pay for any Shares tendered pursuant to the
Offer, may delay the acceptance for payment of any Shares pursuant to Section
1.1(b) of this Agreement, may extend the Offer by one or more times, and may
terminate the Offer at any time after March 31, 2000 if (i) there shall not have
been tendered and not properly withdrawn a number of Shares which, together with
any shares owned by Parent or Acquisition, constitutes at least a majority of
the outstanding Shares on a fully-diluted basis (including for purposes of such
calculation all Shares issuable upon exercise of all vested Company Stock
Options and unvested Company Stock Options that vest prior to the Final Date,
but excluding any Shares held by the Company or any of its subsidiaries); (ii)
any applicable waiting period under the HSR Act has not expired or terminated;
(iii) all necessary consents and approvals from all Governmental Entities shall
not have been obtained on terms and conditions reasonably satisfactory to
Parent; or (iv) at any time after the date of this Agreement, and before
acceptance for payment of any Shares, any of the following events shall occur
and be continuing:
(a) there shall have been any action taken, or any statute,
rule, regulation, judgment, order or injunction promulgated, entered,
enforced, enacted, issued or deemed applicable to the Offer or the
Merger by any domestic or foreign court or other Governmental Entity
which directly or indirectly (i) prohibits, or makes illegal, the
acceptance for payment, payment for or purchase of Shares or the
consummation of the Offer, the Merger or the other transactions
contemplated by this Agreement, (ii) renders Acquisition unable to
accept for payment, pay for or purchase some or all of the Shares,
(iii) imposes material limitations on the ability of Parent effectively
to exercise full rights of ownership of the Shares, including the right
to vote the Shares purchased by it on all matters properly presented to
the Company's stockholders, or (iv) otherwise has a Material Adverse
Effect on the Company; or (2) in connection with the compliance by
Parent or Acquisition with any Applicable Law (including the HSR Act)
or obtaining the consent or approval of any Governmental Entity whose
consent or approval may be required to consummate the transactions
contemplated by this Agreement, Parent shall be (i) required, or be
construed to be required, to sell or divest any assets or business or
to restrict any business operations in order to obtain the consent or
successful termination of any review of any such Governmental Entity
regarding the transactions contemplated hereby or (ii) prohibited from
owning, or any material limitation shall be imposed on Parent's
ownership of, any material portion of the Company's business or assets.
(b) (i) the representations and warranties of the Company
contained in this Agreement at the date hereof and as of the
consummation of the Offer with the same effect as if made at and as of
the consummation of the Offer (except as to any such representation or
warranty which speaks as of a specific date) shall not be true and
correct
A-1
<PAGE>
in any respect that is reasonably likely to have a Material Adverse
Effect (or if such representations and warranties are qualified
by reference to materiality or a Material Adverse Effect, shall not be
true and correct), (ii) the Company shall have failed to perform in all
material respects its covenants or agreements contained in this
Agreement which would have a Material Adverse Effect on the Company
(or, in the case of Section 5.2, any material breach thereof) or
materially adversely affect (or materially delay) the ability of
Acquisition to consummate the Offer or of Parent, Acquisition or the
Company to consummate the Merger, and the Company has not cured such
breach within five business days after notice by Parent or Acquisition
thereof, or (iii) there shall have occurred since January 2, 1999 any
events or changes which constitute a Material Adverse Effect on the
Company;
(c) it shall have been publicly disclosed or Parent shall have
otherwise learned that (i) any person or "group" (as defined in Section
13(d)(3) of the Exchange Act) shall have acquired or entered into a
definitive agreement or agreement in principle to acquire beneficial
ownership of more than 35% of the Shares or any other class of capital
stock of the Company, through the acquisition of stock, the formation
of a group or otherwise, or shall have been granted any option, right
or warrant, conditional or otherwise, to acquire beneficial ownership
of more than 35% of the Shares and (ii) such person or group shall not
have tendered such Shares pursuant to the Offer;
(d) the Company Board shall have withdrawn, or modified or
changed in a manner adverse to Parent and Acquisition (including by
amendment of the Schedule 14D-9), its recommendation of the Offer, this
Agreement or the Merger, or recommended another proposal or offer, or
the Company Board, shall have resolved to do any of the foregoing;
(e) this Agreement shall have terminated in accordance with
its terms; or
(f) there shall have occurred: (i) any general suspension of
trading in, or limitation on prices for, securities on the New York
Stock Exchange or the Nasdaq National Market, for a period in excess of
24 hours; (ii) the commencement of a war, armed hostilities or other
national or international calamity directly or indirectly involving the
United States that constitutes a Material Adverse Effect on the Company
or materially adversely affects or delays the consummation of the
Offer; (iii) the average of the closing prices of the Standard & Poor's
500 Index for any 20 consecutive trading days shall be 25% or more
below the closing price of such index on any trading day on or after
the date hereof that precedes the commencement of such 20-trading day
period; or (iv) in the case of any of the foregoing existing at the
time of the commencement of the Offer, a material acceleration or
worsening thereof;
which in the good faith judgment of Parent, in any such case, and regardless of
the circumstances (including any action or inaction by Parent) giving rise to
such condition makes it inadvisable to proceed with the Offer or the acceptance
for payment of or payment for the Shares.
A-2
<PAGE>
The foregoing conditions (other than the Minimum Condition) are for the sole
benefit of Parent and Acquisition and may be waived by Parent and Acquisition,
in whole or in part at any time and from time to time, in the sole discretion of
Parent and Acquisition. The failure by Parent and Acquisition at any time to
exercise any of the foregoing rights shall not be deemed a waiver of any such
right and each such right shall be deemed an ongoing right which may be asserted
at any time and from time to time.
A-3
<PAGE>
Exhibit (c)(2)
Execution Copy
TENDER AND VOTING AGREEMENT
AND
IRREVOCABLE PROXY
THIS TENDER AND VOTING AGREEMENT AND IRREVOCABLE PROXY, dated as of
July 27, 1999 (this "Agreement"), is entered into by and between MSAS Global
Logistics Inc., a New York corporation ("Parent"), and MSAS Acquisition
Corporation, a Delaware corporation and wholly-owned subsidiary of Parent
("Acquisition"), on the one hand, and R. C. Matney ("Stockholder"), on the other
hand.
RECITALS
A. Concurrently herewith, Parent, Acquisition and Mark VII, Inc., a
Delaware corporation (the "Company"), have entered into an Agreement and Plan of
Merger, of even date herewith (as such agreement may hereafter be amended from
time to time, the "Merger Agreement"), pursuant to which Acquisition will make a
tender offer (the "Offer") for all outstanding shares of common stock, $0.05 par
value, of the Company ("Company Common Stock") at an offer price of $23 per
share, net to the seller in cash (such amount, or any greater amount per share
paid pursuant to the Offer, shall be referred to herein as the "Offer Price")
and, after Acquisition has accepted tendered shares for payment (the date on
which such acceptance occurs, the "Acceptance Date"), the Company and
Acquisition will merge with the Company as the surviving corporation and
wholly-owned subsidiary of Parent (the "Merger"). Initially capitalized and
other terms used but not defined herein shall have the meanings ascribed to them
in the Merger Agreement.
B. Stockholder Beneficially Owns (as defined herein) the number of
shares of Company Common Stock set forth opposite Stockholder's name on Schedule
A hereto (such shares, together with shares of Company Common Stock issuable
upon the exercise of options to purchase shares of Company Common Stock
(including the options set forth on Schedule A (the "Options")), being
collectively referred to herein as the "Shares").
C. As an inducement and a condition to entering into the Merger
Agreement, Parent and Acquisition have requested that Stockholder agree, and
Stockholder has agreed, to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
premises, representations, warranties, covenants and agreements contained
herein, the parties hereto hereby agree as follows:
1. PROVISIONS CONCERNING COMPANY COMMON STOCK.
<PAGE>
(a) Stockholder hereby agrees with Parent and Acquisition that
Stockholder will, promptly after the date of commencement of the Offer (but in
all events not later than five business days thereafter), tender to Acquisition
all outstanding Shares Beneficially Owned by Stockholder on such date (the
"Tendered Shares"). Stockholder further agrees to tender to Acquisition promptly
after Stockholder's acquisition thereof (but in all events not later than five
business days thereafter) all other shares of Company Common Stock acquired
and/or Beneficially Owned by Stockholder at any time prior to the Acceptance
Date or the date on which the Offer is terminated or expires without Acquisition
having accepted shares for payment. All such subsequently tendered Shares shall
constitute "Tendered Shares" for all purposes of this Agreement. Stockholder
agrees not to withdraw any of the Tendered Shares except following the earliest
of the termination of the Merger Agreement, the termination of the Offer or
expiration of the Offer without Acquisition's having accepted the Tendered
Shares for payment. Stockholder acknowledges and agrees that Acquisition's
obligation to accept for payment and pay for the Tendered Shares is subject to
all the terms and conditions of the Offer.
(b) Stockholder hereby agrees with Parent and Acquisition
that, subject to the receipt of proper notice and in the absence of a
preliminary injunction or other final order by any court or other administrative
or judicial authority barring such action, at any meeting of the Company's
stockholders, however called, or in connection with any written consent of the
Company's stockholders, Stockholder will vote the Shares Beneficially Owned by
Stockholder, whether heretofore owned or hereafter acquired: (i) in favor of
approval of the Merger Agreement and any actions required in furtherance of the
transactions contemplated thereby, including voting such shares in favor of the
election to the Company Board of each person designated by Parent for nomination
thereto pursuant to Section 1.3(a) of the Merger Agreement at any meeting of the
Company's stockholders called for the election of directors; (ii) against any
action or agreement that would result in a breach in any respect of any
covenant, representation or warranty or any other obligation or agreement of the
Company under the Merger Agreement; and (iii) except as otherwise agreed to in
writing in advance by Parent, against (A) any Third Party Acquisition, (B) any
change in a majority of the individuals who, as of the date hereof, constitute
the Board of Directors of the Company (other than as contemplated by Section 1.3
of the Merger Agreement), (C) any extraordinary corporate transaction, such as a
merger, consolidation or other business combination involving the Company or any
of its subsidiaries and any Third Party, (D) a sale, lease, transfer or
disposition of any assets of the Company's or any of its subsidiaries' business
outside the ordinary course of business, or any assets which are material to its
business whether or not in the ordinary course of business, or a reorganization,
recapitalization, dissolution or liquidation of the Company or any of its
subsidiaries, (E) any change in the present capitalization of the Company or any
amendment of the Company's Certificate of Incorporation or bylaws, (F) any other
material change in the Company's corporate structure or affecting its business,
or (G) any other action which is intended, or could reasonably be expected, to
impede, interfere with, delay, postpone or materially adversely affect the
Offer, the Merger or any of the other transactions contemplated by the Merger
Agreement, or any of the transactions contemplated by this Agreement.
Stockholder shall not enter into any agreement or understanding with any person
the effect of which would be inconsistent or violative of the provisions and
agreements contained herein. For purposes of this Agreement, "Beneficially
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<PAGE>
Own" or "Beneficial Ownership" with respect to any securities shall mean
Stockholder having such ownership, control or power to direct the voting with
respect to, or otherwise enables Stockholder to legally act with respect to,
such securities as contemplated hereby, including pursuant to any agreement,
arrangement or understanding, whether or not in writing. Securities Beneficially
Owned by Stockholder shall include securities Beneficially Owned by all other
persons with whom Stockholder would constitute a "group" as within the meaning
of Section 13(d)(3) of the Exchange Act. Stockholder and Parent acknowledge and
agree that nothing in this Section 1(b) will require or be construed to require
Stockholder to take any action in his capacity as a member of the Company Board.
2. IRREVOCABLE PROXY.
(a) Stockholder hereby constitutes and appoints Acquisition,
which shall act by and through Ian Smith and Stuart Young (each, a "Proxy
Holder"), or either of them, with full power of substitution, its true and
lawful proxy and attorney-in-fact to vote at any meeting (and any adjournment or
postponement thereof) of the Company's stockholders called for purposes of
considering whether to approve the Merger Agreement, the Merger or any of the
other transactions contemplated by the Merger Agreement, or any Third Party
Acquisition, or to execute a written consent of stockholders in lieu of any such
meeting, all outstanding Shares Beneficially Owned by Stockholder as of the date
of such meeting or written consent in favor of the approval of the Merger
Agreement, the Merger and the other transactions contemplated by the Merger
Agreement, with such modifications to the Merger Agreement as the parties
thereto may make, or against a Third Party Acquisition, as the case may be. Such
proxy will be limited strictly to the power to vote the Shares in the manner set
forth in the preceding sentence and shall not extend to any other matters.
Without limiting the foregoing, in any such vote or other action pursuant to
such proxy, the Proxy Holders shall not have the right (and such proxy shall not
confer the right) to vote to reduce the Offer Price or otherwise modify or amend
the Merger Agreement to reduce the rights or benefits of the Company or any
stockholders of the Company (including Stockholder) under the Offer or the
Merger Agreement or to reduce the rights or obligations of Parent or Acquisition
thereunder.
(b) The proxy and power of attorney granted herein shall be
irrevocable during the term of this Agreement, shall be deemed to be coupled
with an interest sufficient in law to support an irrevocable proxy and shall
revoke all prior proxies granted by Stockholder. Stockholder will not grant any
proxy to any person which conflicts with the proxy granted herein, and any
attempt to do so will be void. The power of attorney granted herein is a durable
power of attorney and will survive the death or incapacity of Stockholder.
(c) If Stockholder fails for any reason to vote his, hers or
its Shares in accordance with the requirements of Section 1(b) hereof, then the
Proxy Holder shall have the right to vote the Shares at any meeting of the
Company's stockholders and in any action by written consent of the Company's
stockholders in accordance with the provisions of this Section 2. The vote of
the Proxy Holder will control in any conflict between his vote of such Shares
and a vote by Stockholder of such Shares.
3
<PAGE>
3. PURCHASE OPTION.
(a) Stockholder grants to Parent and Acquisition an
irrevocable option (the "Purchase Option") to purchase for cash, in the manner
set forth below, any or all of the Shares (and any shares of Company Common
Stock acquired by Stockholder after the date hereof) at a price (the "Exercise
Price") per share equal to the Offer Price. In the event of any stock dividends,
stock splits, recapitalizations, combinations, exchanges or shares or similar
transactions, the Offer Price shall be appropriately adjusted.
(b) (1) Subject to the conditions set forth in Section 3(d),
the Purchase Option may be exercised by Parent or Acquisition, in whole or in
part, at any time or from time to time after the occurrence of any Trigger Event
(as defined below). The Company and Stockholder shall notify Parent promptly in
writing of the occurrence of any Trigger Event. The giving of such notice by the
Company or Stockholder is not a condition to the right of Parent or Acquisition
to exercise the Purchase Option. In the event Parent or Acquisition wishes to
exercise the Purchase Option, Parent shall deliver to Stockholder a written
notice (an "Exercise Notice") specifying the total number of Shares it wishes to
purchase from Stockholder. Each closing of a purchase of Shares (a "Closing")
will occur at a place, on a date and at a time designated by Parent or
Acquisition in an Exercise Notice delivered at least two business days prior to
the date of the Closing.
(2) A "Trigger Event" means any one of the following:
(i) the Merger Agreement becomes terminable under circumstances that entitle
Parent or Acquisition to receive the liquidated damages under Section 7.3(a) of
the Merger Agreement or fees and expenses under Section 7.3(b) of the Merger
Agreement (regardless of whether the Merger Agreement is actually terminated and
whether such liquidated damages or fees and expenses are then actually paid);
(ii) the Offer is consummated but, due to the failure of Stockholder to validly
tender and not withdraw all of the then outstanding Beneficially Owned Shares,
Acquisition has not accepted for payment or paid for all of such shares of
Company Common Stock; (iii) a tender or exchange offer for at least 10% of the
shares of Company Common Stock shall have been publicly proposed to be made or
shall have been made by another person; or (iv) it shall have been publicly
disclosed or Parent or Acquisition shall have otherwise learned that (A) any
person or "group" (as defined in Section 13(d)(3) of the Exchange Act) (other
than Parent or Acquisition) shall have acquired or proposed to acquire
beneficial ownership of more than 10% of any class or series of capital stock of
the Company (including the Company Common Stock), through the acquisition of
stock, the formation of a group or otherwise, or shall have been granted any
option, right or warrant, conditional or otherwise, to acquire beneficial
ownership of more than 10% of any class or series of capital stock of the
Company or any of its subsidiaries, or (B) any person or group (other than
Parent and Acquisition) shall have entered into or publicly offered to enter
into a definitive agreement or an agreement in principle with respect to a
merger, consolidation or other business combination with the Company or any of
its subsidiaries.
(3) If requested by Parent and Acquisition in the
Exercise Notice, Stockholder shall exercise all Options (to the extent
exercisable) and other rights (including
4
<PAGE>
conversion or exchange rights) Beneficially Owned by Stockholder and shall sell
or, if directed by Parent and Acquisition, tender the Shares acquired pursuant
to such exercise to Parent or Acquisition as provided in this Agreement.
(c) TERMINATION OF PURCHASE OPTION. The Purchase Option will terminate
upon the earliest of: (i) the Acceptance Date; (ii) termination of the Merger
Agreement other than upon, during the continuance of or after a Trigger Event;
or (iii) 90 days following any termination of the Merger Agreement upon, during
the continuance of or after a Trigger Event (or if, at the expiration of such 90
day period the Purchase Option cannot be exercised by reason of any applicable
judgment, decree, order, injunction, law or regulation, ten business days after
such impediment to exercise has been removed or has become final and not subject
to appeal). Upon the giving by Parent or Acquisition to Stockholder of the
Exercise Notice and the tender of the aggregate Exercise Price, Parent or
Acquisition, as the case may be, will be deemed to be the holder of record of
the Shares transferable upon such exercise, notwithstanding that the stock
transfer books of the Company are then closed or that certificates representing
such Shares have not been actually delivered to Parent.
(d) CONDITIONS TO CLOSING. The obligation of Stockholder to sell
Stockholder's Shares to Parent or Acquisition hereunder is subject to the
conditions that: (i) all waiting periods, if any, under the HSR Act, applicable
to the sale of the Shares or the acquisition of the Shares by Parent or
Acquisition, as the case may be, hereunder have expired or have been terminated;
(ii) all consents, approvals, orders or authorizations of, or registrations,
declarations or filings with, any court, administrative agency or other
Governmental Entity, if any, required in connection with sale of the Shares or
the acquisition of the Shares by Parent or Acquisition hereunder have been
obtained or made; and (iii) no preliminary or permanent injunction or other
order by any court of competent jurisdiction prohibiting or otherwise
restraining such sale or acquisition is in effect.
(e) CLOSING. At any Closing with respect to Shares Beneficially Owned
by Stockholder, (i) Stockholder will deliver to Parent, Acquisition or their
respective designee a certificate or certificates in definitive form
representing the number of the Shares designated by Parent or Acquisition, as
the case may be, in its Exercise Notice, such certificate to be registered in
the name of Parent, Acquisition or their respective designee and (ii) Parent or
Acquisition, as the case may be, will deliver to Stockholder the aggregate
Exercise Price for the Shares so designated and being purchased by wire transfer
of immediately available funds.
(f) REGISTRATION RIGHTS. (1) Following termination of the Merger
Agreement, Parent or Acquisition may in its sole discretion (but shall not be
required) by written notice (the "Registration Notice") to the Company request
the Company to register under the Securities Act all or any part of the shares
of Company Common Stock acquired under the Purchase Option (the "Registrable
Securities").
(2) The Company shall use commercially reasonable
efforts to effect, as promptly as practicable, the registration under the
Securities Act of the Registrable Securities; PROVIDED, HOWEVER, that (i) Parent
and Acquisition will be entitled to no more than one effective
5
<PAGE>
registration statement hereunder and (ii) the Company will not be required to
file any such registration statement during any period of time (not to exceed 40
days after such request in the case of clause (A) below or 90 days in the case
of clauses (B) and (C) below) when (A) the Company is in possession of material
non-public information that it reasonably believes would be detrimental to be
disclosed at such time and that such information would have to be disclosed if a
registration statement were filed at that time, (B) the Company is required
under the Securities Act to include audited financial statements for any period
in such registration statement and such financial statements are not yet
available for inclusion in such registration statement or (C) the Company
determines, in its reasonable judgment, that such registration would interfere
with any proposed financing, acquisition or other material transaction involving
the Company or any of its affiliates. The Company shall use its reasonable best
efforts to cause any Registrable Securities registered pursuant to this Section
3(f) to be qualified for sale under the securities or blue-sky laws of such
jurisdictions as Parent or Acquisition may reasonably request and shall continue
such registration or qualification in effect in such jurisdiction.
(3) The registration rights set forth in this Section
3(f) are subject to the condition that Parent and Acquisition shall provide the
Company with such information with respect to their Registrable Securities, the
plans for the distribution thereof, and such other information with respect to
such holder as, in the reasonable judgment of counsel for the Company, is
necessary to enable the Company to include in such registration statement all
material facts required to be disclosed with respect to a registration
thereunder.
(4) A registration effected under this Section 3(f)
will be effected at the Company's expense, except for underwriting discounts and
commissions and the fees and the expenses of counsel to Parent and Acquisition
(which will be paid by Parent and Acquisition, and the Company shall provide to
the underwriters (in connection with an underwritten offering) such
documentation (including certificates, opinions of counsel and "comfort" letters
from auditors) as are customary in connection with underwritten offerings as
such underwriters may reasonably require. In connection with any such
registration, the parties agree (i) to indemnify each other and the underwriters
in the customary manner, (ii) to enter into an underwriting agreement in form
and substance customary for transactions of such type with the underwriters
participating in such offering and (iii) to take all further actions that will
be reasonably necessary to effect such registration and sale (including, if the
underwriters deem it necessary, participating in road-show presentations).
4. DIRECTOR MATTERS EXCLUDED. Parent and Acquisition acknowledge and
agree that no provision of this Agreement shall limit or otherwise restrict
Stockholder with respect to any act or omission that Stockholder may undertake
or authorize in his capacity as a director of the Company, including any vote
that Stockholder may make as a director of the Company with respect to any
matter presented to the Board of Directors of the Company.
5. OTHER COVENANTS, REPRESENTATIONS AND WARRANTIES. Stockholder hereby
represents and warrants to Parent and Acquisition as follows:
(a) OWNERSHIP OF SHARES. Stockholder is the Beneficial Owner
of all the
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<PAGE>
Shares. On the date hereof, the Shares constitute all of the Shares
Beneficially Owned by Stockholder. Stockholder has voting power with respect
to the matters set forth in Section 1(b) hereof with respect to all of the
Shares, with no limitations, qualifications or restrictions on such rights.
(b) POWER; BINDING AGREEMENT. Stockholder has the legal
capacity, power and authority to enter into and perform all of its obligations
under this Agreement. The execution, delivery and performance of this Agreement
by Stockholder shall not violate any agreement or any court order to which
Stockholder is a party or is subject including any voting agreement or voting
trust. This Agreement has been duly and validly executed and delivered by
Stockholder.
(c) RESTRICTION ON TRANSFER, PROXIES AND NON-INTERFERENCE.
Except as expressly contemplated by this Agreement, Stockholder will not,
directly or indirectly: (i) offer for sale, sell, transfer, tender, pledge,
encumber, assign or otherwise dispose of, or enter into any contract, option or
other arrangement or understanding with respect to or consent to the offer for
sale, sale, transfer, tender, pledge, encumbrance, assignment or other
disposition of, any or all of the Shares or any interest therein; (ii) grant any
proxies or powers of attorney or deposit any Shares into a voting trust or enter
into a voting agreement with respect to any Shares; or (iii) take any action
that would make any representation or warranty of Stockholder contained herein
untrue or incorrect or have the effect of preventing or disabling Stockholder
from performing any of Stockholder's obligations under this Agreement.
(d) OTHER POTENTIAL ACQUIRORS. Stockholder (i) will
immediately cease any existing discussions or negotiations, if any, with any
persons conducted heretofore with respect to any acquisition of all or any
material portion of the assets of, or any equity interest in, the Company or any
of its subsidiaries, or any business combination with the Company or its
subsidiaries, in his, her or its capacity as such; (ii) from and after the date
hereof until the earlier of the termination of the Merger Agreement in
accordance with its terms and the Effective Time, will not, in such capacity,
directly or indirectly, initiate, solicit or knowingly encourage (including by
way of furnishing non-public information or assistance), or take any other
action to facilitate knowingly, any inquiries or the making of any Third Party
Acquisition; and (iii) shall promptly notify Parent of any proposals for, or
inquiries with respect to, a potential Third Party Acquisition received by
Stockholder or of which Stockholder otherwise has knowledge.
(e) RELIANCE BY PARENT AND ACQUISITION. Stockholder
understands and acknowledges that Parent and Acquisition are entering into the
Merger Agreement in reliance upon Stockholder's execution and delivery of this
Agreement.
6. STOP TRANSFER. Stockholder agrees with, and covenants to, Parent and
Acquisition that Stockholder will not request that the Company register the
transfer (book-entry or otherwise) of any certificate or uncertificated interest
representing any Shares, unless such transfer is made pursuant to this
Agreement. In the event of a stock dividend or distribution, or any change in
the Company Common Stock by reason of any stock dividend, split-up,
recapitalization, combination, exchange of shares or the like, the term "Shares"
shall be deemed to refer to and
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include the Shares as well as all such stock dividends and distributions and
any shares into which or for which any or all of the Shares may be changed or
exchanged.
7. TERMINATION. This Agreement (except as set forth in Section 3) shall
terminate upon the earliest to occur of: (a) the termination of the Merger
Agreement in accordance with its terms; (b) the Acceptance Date; and (c) July
31, 2000. No such termination of this Agreement shall relieve any party hereto
from any liability for any breach of this Agreement prior to termination.
8. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof.
(b) CERTAIN EVENTS. Stockholder agrees that this Agreement and
the obligations hereunder shall attach to the Shares and shall be binding upon
any person to which legal or beneficial ownership of any Shares shall pass,
whether by operation of law or otherwise. Notwithstanding any transfer of
Shares, the transferor shall remain liable for the performance of all
obligations under this Agreement of the transferor.
(c) ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by operation of law or
otherwise without the prior written consent of the other party; PROVIDED,
HOWEVER, that Parent may, in its sole discretion, assign its rights and
obligations hereunder to any direct wholly-owned subsidiary of Parent.
(d) AMENDMENTS, WAIVERS, ETC. This Agreement may not be
amended, changed, supplemented, waived or otherwise modified or terminated,
except upon the execution and delivery of a written agreement executed by the
parties hereto.
(e) NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if so given) by hand delivery, telecopy, or by
mail (registered or certified mail, postage prepaid, return receipt requested)
or by any nationally-recognized overnight courier service, such as Federal
Express, providing proof of delivery. Any such notice or communication shall be
deemed to have been delivered and received (i) in the case of hand delivery, on
the date of such delivery, (ii) in the case of telecopy, on the date sent if
confirmation of receipt is received and such notice is also promptly mailed by
registered or certified mail (return receipt requested), (iii) in the case of a
nationally-recognized overnight courier service, in circumstances under which
such courier guarantees next business day delivery, on the next business day
after the date when sent, and (iv) the case of mailing on the third business day
following that on which the piece of mail containing such communication is
posted. All communications hereunder shall be delivered to the respective
parties at the following addresses:
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If to Stockholder: at the address set forth on Schedule A
attached hereto
with copies to: Mark VII, Inc.
965 Ridge Lake Boulevard, Suite 100
Memphis, Tennessee 38120
Telecopier: (901) 767-1929
Attention: General Counsel
and
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10019
Telephone: (212) 259-6720
Facsimile: (212) 259-6333
Attention: Robert M. Smith
If to Parent or Acquisition: c/o Ocean Group plc
Ocean House
The Ring
Bracknell
Berkshire RG12 1AW
England
Telecopier: 011 44 134 44 452222
Attention: Group Commercial Director
with a copy to: Gibson, Dunn & Crutcher LLP
200 Park Avenue
New York, New York 10166
Telephone: (212) 351-4000
Telecopier: (212) 351-4035
Attention: Steven R. Finley
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the matter set forth above.
(f) SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law but if any provision of this Agreement becomes or is declared by
a court of competent jurisdiction to be invalid, illegal or unenforceable in any
respect under any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other provision or portion
of any provision in such jurisdiction, and this Agreement shall be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion
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<PAGE>
of any provision had never been contained herein.
(g) SPECIFIC PERFORMANCE. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants or agreements
contained in this Agreement shall cause the other party to sustain damage for
which it would not have an adequate remedy at law for money damages, and
therefore each of the parties hereto agrees that in the event of any such breach
the aggrieved party shall be entitled to the remedy of specific performance of
such covenants and agreements and injunctive and other equitable relief in
addition to any other remedy to which it may be entitled, at law or in equity.
(h) NO WAIVER. The failure of any party hereto to exercise any
right, power or remedy provided under this Agreement or otherwise available in
respect hereof at law or in equity, or to insist upon compliance by any other
party hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by such
party of its right to exercise any such or other right, power or remedy or to
demand such compliance.
(i) GOVERNING LAW. This Agreement shall be governed and
construed in accordance with the laws of the State of Delaware, without giving
effect to the principles of conflicts of law thereof.
(j) COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original, but all of
which, taken together, shall constitute one and the same Agreement and shall
become effective when one or more of the counterparts have been signed by each
of the parties and delivered to the other parties.
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<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
duly executed as of the day and year first above written.
MSAS GLOBAL LOGISTICS INC.,
a New York corporation
By:/S/ MICK P. FOUNTAIN
---------------------
Name: Mick P. Fountain
Title: Regional Chief Executive
MSAS ACQUISITION CORPORATION,
a Delaware corporation
By:/S/ STUART A. YOUNG
-------------------
Name: Stuart A. Young
Title: Secretary
STOCKHOLDER:
By:/S/ R. C. MATNEY
----------------
Name: R. C. Matney
[SIGNATURE PAGE TO MSAS/MARK VII STOCKHOLDER TENDER AND
VOTING AND IRREVOCABLE PROXY]
11
<PAGE>
<PAGE>
Exhibit (c)(3)
Execution Copy
TENDER AND VOTING AGREEMENT
AND
IRREVOCABLE PROXY
THIS TENDER AND VOTING AGREEMENT AND IRREVOCABLE PROXY, dated as of
July 27, 1999 (this "Agreement"), is entered into by and between MSAS Global
Logistics Inc., a New York corporation ("Parent"), and MSAS Acquisition
Corporation, a Delaware corporation and wholly-owned subsidiary of Parent
("Acquisition"), on the one hand, and David H. Wedaman ("Stockholder"), on the
other hand.
RECITALS
--------
A. Concurrently herewith, Parent, Acquisition and Mark VII, Inc., a
Delaware corporation (the "Company"), have entered into an Agreement and Plan of
Merger, of even date herewith (as such agreement may hereafter be amended from
time to time, the "Merger Agreement"), pursuant to which Acquisition will make a
tender offer (the "Offer") for all outstanding shares of common stock, $0.05 par
value, of the Company ("Company Common Stock") at an offer price of $23 per
share, net to the seller in cash (such amount, or any greater amount per share
paid pursuant to the Offer, shall be referred to herein as the "Offer Price")
and, after Acquisition has accepted tendered shares for payment (the date on
which such acceptance occurs, the "Acceptance Date"), the Company and
Acquisition will merge with the Company as the surviving corporation and
wholly-owned subsidiary of Parent (the "Merger"). Initially capitalized and
other terms used but not defined herein shall have the meanings ascribed to them
in the Merger Agreement.
B. Stockholder Beneficially Owns (as defined herein) the number of
shares of Company Common Stock set forth opposite Stockholder's name on Schedule
A hereto (such shares, together with shares of Company Common Stock issuable
upon the exercise of options to purchase shares of Company Common Stock
(including the options set forth on Schedule A (the "Options")), being
collectively referred to herein as the "Shares").
C. As an inducement and a condition to entering into the Merger
Agreement, Parent and Acquisition have requested that Stockholder agree, and
Stockholder has agreed, to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
premises, representations, warranties, covenants and agreements contained
herein, the parties hereto hereby agree as follows:
1. PROVISIONS CONCERNING COMPANY COMMON STOCK.
<PAGE>
(a) Stockholder hereby agrees with Parent and Acquisition that
Stockholder will, promptly after the date of commencement of the Offer (but in
all events not later than five business days thereafter), tender to Acquisition
all outstanding Shares Beneficially Owned by Stockholder on such date (the
"Tendered Shares"). Stockholder further agrees to tender to Acquisition promptly
after Stockholder's acquisition thereof (but in all events not later than five
business days thereafter) all other shares of Company Common Stock acquired
and/or Beneficially Owned by Stockholder at any time prior to the Acceptance
Date or the date on which the Offer is terminated or expires without Acquisition
having accepted shares for payment. All such subsequently tendered Shares shall
constitute "Tendered Shares" for all purposes of this Agreement. Stockholder
agrees not to withdraw any of the Tendered Shares except following the earliest
of the termination of the Merger Agreement, the termination of the Offer or
expiration of the Offer without Acquisition's having accepted the Tendered
Shares for payment. Stockholder acknowledges and agrees that Acquisition's
obligation to accept for payment and pay for the Tendered Shares is subject to
all the terms and conditions of the Offer.
(b) Stockholder hereby agrees with Parent and Acquisition that,
subject to the receipt of proper notice and in the absence of a preliminary
injunction or other final order by any court or other administrative or judicial
authority barring such action, at any meeting of the Company's stockholders,
however called, or in connection with any written consent of the Company's
stockholders, Stockholder will vote the Shares Beneficially Owned by
Stockholder, whether heretofore owned or hereafter acquired: (i) in favor of
approval of the Merger Agreement and any actions required in furtherance of the
transactions contemplated thereby, including voting such shares in favor of the
election to the Company Board of each person designated by Parent for nomination
thereto pursuant to Section 1.3(a) of the Merger Agreement at any meeting of the
Company's stockholders called for the election of directors; (ii) against any
action or agreement that would result in a breach in any respect of any
covenant, representation or warranty or any other obligation or agreement of the
Company under the Merger Agreement; and (iii) except as otherwise agreed to in
writing in advance by Parent, against (A) any Third Party Acquisition, (B) any
change in a majority of the individuals who, as of the date hereof, constitute
the Board of Directors of the Company (other than as contemplated by Section 1.3
of the Merger Agreement), (C) any extraordinary corporate transaction, such as a
merger, consolidation or other business combination involving the Company or any
of its subsidiaries and any Third Party, (D) a sale, lease, transfer or
disposition of any assets of the Company's or any of its subsidiaries' business
outside the ordinary course of business, or any assets which are material to its
business whether or not in the ordinary course of business, or a reorganization,
recapitalization, dissolution or liquidation of the Company or any of its
subsidiaries, (E) any change in the present capitalization of the Company or any
amendment of the Company's Certificate of Incorporation or bylaws, (F) any other
material change in the Company's corporate structure or affecting its business,
or (G) any other action which is intended, or could reasonably be expected, to
impede, interfere with, delay, postpone or materially adversely affect the
Offer, the Merger or any of the other transactions contemplated by the Merger
Agreement, or any of the transactions contemplated by this Agreement.
Stockholder shall not enter into any agreement or understanding with any person
the effect of which would be inconsistent or violative of the provisions and
agreements contained herein. For purposes of this Agreement, "Beneficially
2
<PAGE>
Own" or "Beneficial Ownership" with respect to any securities shall mean
Stockholder having such ownership, control or power to direct the voting with
respect to, or otherwise enables Stockholder to legally act with respect to,
such securities as contemplated hereby, including pursuant to any agreement,
arrangement or understanding, whether or not in writing. Securities Beneficially
Owned by Stockholder shall include securities Beneficially Owned by all other
persons with whom Stockholder would constitute a "group" as within the meaning
of Section 13(d)(3) of the Exchange Act. Stockholder and Parent acknowledge and
agree that nothing in this Section 1(b) will require or be construed to require
Stockholder to take any action in his capacity as a member of the Company Board.
2. IRREVOCABLE PROXY.
(a) Stockholder hereby constitutes and appoints Acquisition,
which shall act by and through Ian Smith and Stuart Young (each, a "Proxy
Holder"), or either of them, with full power of substitution, its true and
lawful proxy and attorney-in-fact to vote at any meeting (and any adjournment or
postponement thereof) of the Company's stockholders called for purposes of
considering whether to approve the Merger Agreement, the Merger or any of the
other transactions contemplated by the Merger Agreement, or any Third Party
Acquisition, or to execute a written consent of stockholders in lieu of any such
meeting, all outstanding Shares Beneficially Owned by Stockholder as of the date
of such meeting or written consent in favor of the approval of the Merger
Agreement, the Merger and the other transactions contemplated by the Merger
Agreement, with such modifications to the Merger Agreement as the parties
thereto may make, or against a Third Party Acquisition, as the case may be. Such
proxy will be limited strictly to the power to vote the Shares in the manner set
forth in the preceding sentence and shall not extend to any other matters.
Without limiting the foregoing, in any such vote or other action pursuant to
such proxy, the Proxy Holders shall not have the right (and such proxy shall not
confer the right) to vote to reduce the Offer Price or otherwise modify or amend
the Merger Agreement to reduce the rights or benefits of the Company or any
stockholders of the Company (including Stockholder) under the Offer or the
Merger Agreement or to reduce the rights or obligations of Parent or Acquisition
thereunder.
(b) The proxy and power of attorney granted herein shall be
irrevocable during the term of this Agreement, shall be deemed to be coupled
with an interest sufficient in law to support an irrevocable proxy and shall
revoke all prior proxies granted by Stockholder. Stockholder will not grant any
proxy to any person which conflicts with the proxy granted herein, and any
attempt to do so will be void. The power of attorney granted herein is a durable
power of attorney and will survive the death or incapacity of Stockholder.
(c) If Stockholder fails for any reason to vote his, hers or
its Shares in accordance with the requirements of Section 1(b) hereof, then the
Proxy Holder shall have the right to vote the Shares at any meeting of the
Company's stockholders and in any action by written consent of the Company's
stockholders in accordance with the provisions of this Section 2. The vote of
the Proxy Holder will control in any conflict between his vote of such Shares
and a vote by Stockholder of such Shares.
3
<PAGE>
3. PURCHASE OPTION.
(a) Stockholder grants to Parent and Acquisition an irrevocable
option (the "Purchase Option") to purchase for cash, in the manner set forth
below, any or all of the Shares (and any shares of Company Common Stock acquired
by Stockholder after the date hereof) at a price (the "Exercise Price") per
share equal to the Offer Price. In the event of any stock dividends, stock
splits, recapitalizations, combinations, exchanges or shares or similar
transactions, the Offer Price shall be appropriately adjusted.
(b) (1) Subject to the conditions set forth in Section 3(d),
the Purchase Option may be exercised by Parent or Acquisition, in whole or in
part, at any time or from time to time after the occurrence of any Trigger Event
(as defined below). The Company and Stockholder shall notify Parent promptly in
writing of the occurrence of any Trigger Event. The giving of such notice by the
Company or Stockholder is not a condition to the right of Parent or Acquisition
to exercise the Purchase Option. In the event Parent or Acquisition wishes to
exercise the Purchase Option, Parent shall deliver to Stockholder a written
notice (an "Exercise Notice") specifying the total number of Shares it wishes to
purchase from Stockholder. Each closing of a purchase of Shares (a "Closing")
will occur at a place, on a date and at a time designated by Parent or
Acquisition in an Exercise Notice delivered at least two business days prior to
the date of the Closing.
(2) A "Trigger Event" means any one of the following: (i) the
Merger Agreement becomes terminable under circumstances that entitle Parent or
Acquisition to receive the liquidated damages under Section 7.3(a) of the Merger
Agreement or fees and expenses under Section 7.3(b) of the Merger Agreement
(regardless of whether the Merger Agreement is actually terminated and whether
such liquidated damages or fees and expenses are then actually paid); (ii) the
Offer is consummated but, due to the failure of Stockholder to validly tender
and not withdraw all of the then outstanding Beneficially Owned Shares,
Acquisition has not accepted for payment or paid for all of such shares of
Company Common Stock; (iii) a tender or exchange offer for at least 10% of the
shares of Company Common Stock shall have been publicly proposed to be made or
shall have been made by another person; or (iv) it shall have been publicly
disclosed or Parent or Acquisition shall have otherwise learned that (A) any
person or "group" (as defined in Section 13(d)(3) of the Exchange Act) (other
than Parent or Acquisition) shall have acquired or proposed to acquire
beneficial ownership of more than 10% of any class or series of capital stock of
the Company (including the Company Common Stock), through the acquisition of
stock, the formation of a group or otherwise, or shall have been granted any
option, right or warrant, conditional or otherwise, to acquire beneficial
ownership of more than 10% of any class or series of capital stock of the
Company or any of its subsidiaries, or (B) any person or group (other than
Parent and Acquisition) shall have entered into or publicly offered to enter
into a definitive agreement or an agreement in principle with respect to a
merger, consolidation or other business combination with the Company or any of
its subsidiaries.
(3) If requested by Parent and Acquisition in the Exercise
Notice, Stockholder shall exercise all Options (to the extent exercisable) and
other rights (including
4
<PAGE>
conversion or exchange rights) Beneficially Owned by Stockholder and shall sell
or, if directed by Parent and Acquisition, tender the Shares acquired pursuant
to such exercise to Parent or Acquisition as provided in this Agreement.
(c) TERMINATION OF PURCHASE OPTION. The Purchase Option will
terminate upon the earliest of: (i) the Acceptance Date; (ii) termination of the
Merger Agreement other than upon, during the continuance of or after a Trigger
Event; or (iii) 90 days following any termination of the Merger Agreement upon,
during the continuance of or after a Trigger Event (or if, at the expiration of
such 90 day period the Purchase Option cannot be exercised by reason of any
applicable judgment, decree, order, injunction, law or regulation, ten business
days after such impediment to exercise has been removed or has become final and
not subject to appeal). Upon the giving by Parent or Acquisition to Stockholder
of the Exercise Notice and the tender of the aggregate Exercise Price, Parent or
Acquisition, as the case may be, will be deemed to be the holder of record of
the Shares transferable upon such exercise, notwithstanding that the stock
transfer books of the Company are then closed or that certificates representing
such Shares have not been actually delivered to Parent.
(d) CONDITIONS TO CLOSING. The obligation of Stockholder to sell
Stockholder's Shares to Parent or Acquisition hereunder is subject to the
conditions that: (i) all waiting periods, if any, under the HSR Act, applicable
to the sale of the Shares or the acquisition of the Shares by Parent or
Acquisition, as the case may be, hereunder have expired or have been terminated;
(ii) all consents, approvals, orders or authorizations of, or registrations,
declarations or filings with, any court, administrative agency or other
Governmental Entity, if any, required in connection with sale of the Shares or
the acquisition of the Shares by Parent or Acquisition hereunder have been
obtained or made; and (iii) no preliminary or permanent injunction or other
order by any court of competent jurisdiction prohibiting or otherwise
restraining such sale or acquisition is in effect.
(e) CLOSING. At any Closing with respect to Shares Beneficially
Owned by Stockholder, (i) Stockholder will deliver to Parent, Acquisition or
their respective designee a certificate or certificates in definitive form
representing the number of the Shares designated by Parent or Acquisition, as
the case may be, in its Exercise Notice, such certificate to be registered in
the name of Parent, Acquisition or their respective designee and (ii) Parent or
Acquisition, as the case may be, will deliver to Stockholder the aggregate
Exercise Price for the Shares so designated and being purchased by wire transfer
of immediately available funds.
(f) REGISTRATION RIGHTS. (1) Following termination of the Merger
Agreement, Parent or Acquisition may in its sole discretion (but shall not be
required) by written notice (the "Registration Notice") to the Company request
the Company to register under the Securities Act all or any part of the shares
of Company Common Stock acquired under the Purchase Option (the "Registrable
Securities").
(2) The Company shall use commercially reasonable efforts to
effect, as promptly as practicable, the registration under the Securities Act of
the Registrable Securities; PROVIDED, HOWEVER, that (i) Parent and Acquisition
will be entitled to no more than one effective
5
<PAGE>
registration statement hereunder and (ii) the Company will not be required to
file any such registration statement during any period of time (not to exceed 40
days after such request in the case of clause (A) below or 90 days in the case
of clauses (B) and (C) below) when (A) the Company is in possession of material
non-public information that it reasonably believes would be detrimental to be
disclosed at such time and that such information would have to be disclosed if a
registration statement were filed at that time, (B) the Company is required
under the Securities Act to include audited financial statements for any period
in such registration statement and such financial statements are not yet
available for inclusion in such registration statement or (C) the Company
determines, in its reasonable judgment, that such registration would interfere
with any proposed financing, acquisition or other material transaction involving
the Company or any of its affiliates. The Company shall use its reasonable best
efforts to cause any Registrable Securities registered pursuant to this Section
3(f) to be qualified for sale under the securities or blue-sky laws of such
jurisdictions as Parent or Acquisition may reasonably request and shall continue
such registration or qualification in effect in such jurisdiction.
(3) The registration rights set forth in this Section 3(f) are
subject to the condition that Parent and Acquisition shall provide the Company
with such information with respect to their Registrable Securities, the plans
for the distribution thereof, and such other information with respect to such
holder as, in the reasonable judgment of counsel for the Company, is necessary
to enable the Company to include in such registration statement all material
facts required to be disclosed with respect to a registration thereunder.
(4) A registration effected under this Section 3(f) will be
effected at the Company's expense, except for underwriting discounts and
commissions and the fees and the expenses of counsel to Parent and Acquisition
(which will be paid by Parent and Acquisition, and the Company shall provide to
the underwriters (in connection with an underwritten offering) such
documentation (including certificates, opinions of counsel and "comfort" letters
from auditors) as are customary in connection with underwritten offerings as
such underwriters may reasonably require. In connection with any such
registration, the parties agree (i) to indemnify each other and the underwriters
in the customary manner, (ii) to enter into an underwriting agreement in form
and substance customary for transactions of such type with the underwriters
participating in such offering and (iii) to take all further actions that will
be reasonably necessary to effect such registration and sale (including, if the
underwriters deem it necessary, participating in road-show presentations).
4. DIRECTOR MATTERS EXCLUDED. Parent and Acquisition acknowledge and
agree that no provision of this Agreement shall limit or otherwise restrict
Stockholder with respect to any act or omission that Stockholder may undertake
or authorize in his capacity as a director of the Company, including any vote
that Stockholder may make as a director of the Company with respect to any
matter presented to the Board of Directors of the Company.
5. OTHER COVENANTS, REPRESENTATIONS AND WARRANTIES. Stockholder hereby
represents and warrants to Parent and Acquisition as follows:
(a) OWNERSHIP OF SHARES. Stockholder is the Beneficial Owner of all
the
6
<PAGE>
Shares. On the date hereof, the Shares constitute all of the Shares Beneficially
Owned by Stockholder. Stockholder has voting power with respect to the matters
set forth in Section 1(b) hereof with respect to all of the Shares, with no
limitations, qualifications or restrictions on such rights.
(b) POWER; BINDING AGREEMENT. Stockholder has the legal capacity,
power and authority to enter into and perform all of its obligations under this
Agreement. The execution, delivery and performance of this Agreement by
Stockholder shall not violate any agreement or any court order to which
Stockholder is a party or is subject including any voting agreement or voting
trust. This Agreement has been duly and validly executed and delivered by
Stockholder.
(c) RESTRICTION ON TRANSFER, PROXIES AND NON-INTERFERENCE. Except
as expressly contemplated by this Agreement, Stockholder will not, directly or
indirectly: (i) offer for sale, sell, transfer, tender, pledge, encumber, assign
or otherwise dispose of, or enter into any contract, option or other arrangement
or understanding with respect to or consent to the offer for sale, sale,
transfer, tender, pledge, encumbrance, assignment or other disposition of, any
or all of the Shares or any interest therein; (ii) grant any proxies or powers
of attorney or deposit any Shares into a voting trust or enter into a voting
agreement with respect to any Shares; or (iii) take any action that would make
any representation or warranty of Stockholder contained herein untrue or
incorrect or have the effect of preventing or disabling Stockholder from
performing any of Stockholder's obligations under this Agreement.
(d) OTHER POTENTIAL ACQUIRORS. Stockholder (i) will immediately
cease any existing discussions or negotiations, if any, with any persons
conducted heretofore with respect to any acquisition of all or any material
portion of the assets of, or any equity interest in, the Company or any of its
subsidiaries, or any business combination with the Company or its subsidiaries,
in his, her or its capacity as such; (ii) from and after the date hereof until
the earlier of the termination of the Merger Agreement in accordance with its
terms and the Effective Time, will not, in such capacity, directly or
indirectly, initiate, solicit or knowingly encourage (including by way of
furnishing non-public information or assistance), or take any other action to
facilitate knowingly, any inquiries or the making of any Third Party
Acquisition; and (iii) shall promptly notify Parent of any proposals for, or
inquiries with respect to, a potential Third Party Acquisition received by
Stockholder or of which Stockholder otherwise has knowledge.
(e) RELIANCE BY PARENT AND ACQUISITION. Stockholder understands and
acknowledges that Parent and Acquisition are entering into the Merger Agreement
in reliance upon Stockholder's execution and delivery of this Agreement.
6. STOP TRANSFER. Stockholder agrees with, and covenants to, Parent
and Acquisition that Stockholder will not request that the Company register the
transfer (book-entry or otherwise) of any certificate or uncertificated interest
representing any Shares, unless such transfer is made pursuant to this
Agreement. In the event of a stock dividend or distribution, or any change in
the Company Common Stock by reason of any stock dividend, split-up,
recapitalization, combination, exchange of shares or the like, the term "Shares"
shall be deemed to refer to and
7
<PAGE>
include the Shares as well as all such stock dividends and distributions and any
shares into which or for which any or all of the Shares may be changed or
exchanged.
7. TERMINATION. This Agreement (except as set forth in Section 3)
shall terminate upon the earliest to occur of: (a) the termination of the Merger
Agreement in accordance with its terms; (b) the Acceptance Date; and (c) July
31, 2000. No such termination of this Agreement shall relieve any party hereto
from any liability for any breach of this Agreement prior to termination.
8. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof.
(b) CERTAIN EVENTS. Stockholder agrees that this Agreement and the
obligations hereunder shall attach to the Shares and shall be binding upon any
person to which legal or beneficial ownership of any Shares shall pass, whether
by operation of law or otherwise. Notwithstanding any transfer of Shares, the
transferor shall remain liable for the performance of all obligations under this
Agreement of the transferor.
(c) ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by operation of law or
otherwise without the prior written consent of the other party; PROVIDED,
HOWEVER, that Parent may, in its sole discretion, assign its rights and
obligations hereunder to any direct wholly-owned subsidiary of Parent.
(d) AMENDMENTS, WAIVERS, ETC. This Agreement may not be amended,
changed, supplemented, waived or otherwise modified or terminated, except upon
the execution and delivery of a written agreement executed by the parties
hereto.
(e) NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if so given) by hand delivery, telecopy, or by
mail (registered or certified mail, postage prepaid, return receipt requested)
or by any nationally-recognized overnight courier service, such as Federal
Express, providing proof of delivery. Any such notice or communication shall be
deemed to have been delivered and received (i) in the case of hand delivery, on
the date of such delivery, (ii) in the case of telecopy, on the date sent if
confirmation of receipt is received and such notice is also promptly mailed by
registered or certified mail (return receipt requested), (iii) in the case of a
nationally-recognized overnight courier service, in circumstances under which
such courier guarantees next business day delivery, on the next business day
after the date when sent, and (iv) the case of mailing on the third business day
following that on which the piece of mail containing such communication is
posted. All communications hereunder shall be delivered to the respective
parties at the following addresses:
8
<PAGE>
<TABLE>
<S> <C>
If to Stockholder: at the address set forth on Schedule A attached hereto
with copies to: Mark VII, Inc.
965 Ridge Lake Boulevard, Suite 100
Memphis, Tennessee 38120
Telecopier: (901) 767-1929
Attention: General Counsel
and
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10019
Telephone: (212) 259-6720
Facsimile: (212) 259-6333
Attention: Robert M. Smith
If to Parent or Acquisition: c/o Ocean Group plc
Ocean House
The Ring
Bracknell
Berkshire RG12 1AW
England
Telecopier: 011 44 134 44 452222
Attention: Group Commercial Director
with a copy to: Gibson, Dunn & Crutcher LLP
200 Park Avenue
New York, New York 10166
Telephone: (212) 351-4000
Telecopier: (212) 351-4035
Attention: Steven R. Finley
</TABLE>
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the matter set forth above.
(f) SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law but if any provision of this Agreement becomes or is declared by
a court of competent jurisdiction to be invalid, illegal or unenforceable in any
respect under any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other provision or portion
of any provision in such jurisdiction, and this Agreement shall be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion
9
<PAGE>
of any provision had never been contained herein.
(g) SPECIFIC PERFORMANCE. Each of the parties hereto recognizes and
acknowledges that a breach by it of any covenants or agreements contained in
this Agreement shall cause the other party to sustain damage for which it would
not have an adequate remedy at law for money damages, and therefore each of the
parties hereto agrees that in the event of any such breach the aggrieved party
shall be entitled to the remedy of specific performance of such covenants and
agreements and injunctive and other equitable relief in addition to any other
remedy to which it may be entitled, at law or in equity.
(h) NO WAIVER. The failure of any party hereto to exercise any
right, power or remedy provided under this Agreement or otherwise available in
respect hereof at law or in equity, or to insist upon compliance by any other
party hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by such
party of its right to exercise any such or other right, power or remedy or to
demand such compliance.
(i) GOVERNING LAW. This Agreement shall be governed and construed
in accordance with the laws of the State of Delaware, without giving effect to
the principles of conflicts of law thereof.
(j) COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which shall be deemed to be an original, but all of which,
taken together, shall constitute one and the same Agreement and shall become
effective when one or more of the counterparts have been signed by each of the
parties and delivered to the other parties.
10
<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
duly executed as of the day and year first above written.
MSAS GLOBAL LOGISTICS INC.,
a New York corporation
By: /S/ MICK P. FOUNTAIN
-----------------------------------
Name: Mick P. Fountain
Title: Regional Chief Executive
MSAS ACQUISITION CORPORATION,
a Delaware corporation
By: /S/ STUART A. YOUNG
-----------------------------------
Name: Stuart A. Young
Title: Secretary
STOCKHOLDER:
By: /S/ DAVID H. WEDAMAN
-----------------------------------
Name: David H. Wedaman
[SIGNATURE PAGE TO MSAS/MARK VII STOCKHOLDER TENDER AND
VOTING AND IRREVOCABLE PROXY]
11
<PAGE>
Exhibit (c)(4)
Execution Copy
TENDER AND VOTING AGREEMENT
AND
IRREVOCABLE PROXY
THIS TENDER AND VOTING AGREEMENT AND IRREVOCABLE PROXY, dated as of
July 27, 1999 (this "Agreement"), is entered into by and between MSAS Global
Logistics Inc., a New York corporation ("Parent"), and MSAS Acquisition
Corporation, a Delaware corporation and wholly-owned subsidiary of Parent
("Acquisition"), on the one hand, and James T. Graves ("Stockholder"), on the
other hand.
RECITALS
A. Concurrently herewith, Parent, Acquisition and Mark VII, Inc., a
Delaware corporation (the "Company"), have entered into an Agreement and Plan of
Merger, of even date herewith (as such agreement may hereafter be amended from
time to time, the "Merger Agreement"), pursuant to which Acquisition will make a
tender offer (the "Offer") for all outstanding shares of common stock, $0.05 par
value, of the Company ("Company Common Stock") at an offer price of $23 per
share, net to the seller in cash (such amount, or any greater amount per share
paid pursuant to the Offer, shall be referred to herein as the "Offer Price")
and, after Acquisition has accepted tendered shares for payment (the date on
which such acceptance occurs, the "Acceptance Date"), the Company and
Acquisition will merge with the Company as the surviving corporation and
wholly-owned subsidiary of Parent (the "Merger"). Initially capitalized and
other terms used but not defined herein shall have the meanings ascribed to them
in the Merger Agreement.
B. Stockholder Beneficially Owns (as defined herein) the number of
shares of Company Common Stock set forth opposite Stockholder's name on Schedule
A hereto (such shares, together with shares of Company Common Stock issuable
upon the exercise of options to purchase shares of Company Common Stock
(including the options set forth on Schedule A (the "Options")), being
collectively referred to herein as the "Shares").
C. As an inducement and a condition to entering into the Merger
Agreement, Parent and Acquisition have requested that Stockholder agree, and
Stockholder has agreed, to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
premises, representations, warranties, covenants and agreements contained
herein, the parties hereto hereby agree as follows:
1. PROVISIONS CONCERNING COMPANY COMMON STOCK.
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(a) Stockholder hereby agrees with Parent and Acquisition that
Stockholder will, promptly after the date of commencement of the Offer (but in
all events not later than five business days thereafter), tender to Acquisition
all outstanding Shares Beneficially Owned by Stockholder on such date (the
"Tendered Shares"). Stockholder further agrees to tender to Acquisition promptly
after Stockholder's acquisition thereof (but in all events not later than five
business days thereafter) all other shares of Company Common Stock acquired
and/or Beneficially Owned by Stockholder at any time prior to the Acceptance
Date or the date on which the Offer is terminated or expires without Acquisition
having accepted shares for payment. All such subsequently tendered Shares shall
constitute "Tendered Shares" for all purposes of this Agreement. Stockholder
agrees not to withdraw any of the Tendered Shares except following the earliest
of the termination of the Merger Agreement, the termination of the Offer or
expiration of the Offer without Acquisition's having accepted the Tendered
Shares for payment. Stockholder acknowledges and agrees that Acquisition's
obligation to accept for payment and pay for the Tendered Shares is subject to
all the terms and conditions of the Offer.
(b) Stockholder hereby agrees with Parent and Acquisition
that, subject to the receipt of proper notice and in the absence of a
preliminary injunction or other final order by any court or other administrative
or judicial authority barring such action, at any meeting of the Company's
stockholders, however called, or in connection with any written consent of the
Company's stockholders, Stockholder will vote the Shares Beneficially Owned by
Stockholder, whether heretofore owned or hereafter acquired: (i) in favor of
approval of the Merger Agreement and any actions required in furtherance of the
transactions contemplated thereby, including voting such shares in favor of the
election to the Company Board of each person designated by Parent for nomination
thereto pursuant to Section 1.3(a) of the Merger Agreement at any meeting of the
Company's stockholders called for the election of directors; (ii) against any
action or agreement that would result in a breach in any respect of any
covenant, representation or warranty or any other obligation or agreement of the
Company under the Merger Agreement; and (iii) except as otherwise agreed to in
writing in advance by Parent, against (A) any Third Party Acquisition, (B) any
change in a majority of the individuals who, as of the date hereof, constitute
the Board of Directors of the Company (other than as contemplated by Section 1.3
of the Merger Agreement), (C) any extraordinary corporate transaction, such as a
merger, consolidation or other business combination involving the Company or any
of its subsidiaries and any Third Party, (D) a sale, lease, transfer or
disposition of any assets of the Company's or any of its subsidiaries' business
outside the ordinary course of business, or any assets which are material to its
business whether or not in the ordinary course of business, or a reorganization,
recapitalization, dissolution or liquidation of the Company or any of its
subsidiaries, (E) any change in the present capitalization of the Company or any
amendment of the Company's Certificate of Incorporation or bylaws, (F) any other
material change in the Company's corporate structure or affecting its business,
or (G) any other action which is intended, or could reasonably be expected, to
impede, interfere with, delay, postpone or materially adversely affect the
Offer, the Merger or any of the other transactions contemplated by the Merger
Agreement, or any of the transactions contemplated by this Agreement.
Stockholder shall not enter into any agreement or understanding with any person
the effect of which would be inconsistent or violative of the provisions and
agreements contained herein. For purposes of this Agreement, "Beneficially
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Own" or "Beneficial Ownership" with respect to any securities shall mean
Stockholder having such ownership, control or power to direct the voting with
respect to, or otherwise enables Stockholder to legally act with respect to,
such securities as contemplated hereby, including pursuant to any agreement,
arrangement or understanding, whether or not in writing. Securities Beneficially
Owned by Stockholder shall include securities Beneficially Owned by all other
persons with whom Stockholder would constitute a "group" as within the meaning
of Section 13(d)(3) of the Exchange Act. Stockholder and Parent acknowledge and
agree that nothing in this Section 1(b) will require or be construed to require
Stockholder to take any action in his capacity as a member of the Company Board.
2. IRREVOCABLE PROXY.
(a) Stockholder hereby constitutes and appoints Acquisition,
which shall act by and through Ian Smith and Stuart Young (each, a "Proxy
Holder"), or either of them, with full power of substitution, its true and
lawful proxy and attorney-in-fact to vote at any meeting (and any adjournment or
postponement thereof) of the Company's stockholders called for purposes of
considering whether to approve the Merger Agreement, the Merger or any of the
other transactions contemplated by the Merger Agreement, or any Third Party
Acquisition, or to execute a written consent of stockholders in lieu of any such
meeting, all outstanding Shares Beneficially Owned by Stockholder as of the date
of such meeting or written consent in favor of the approval of the Merger
Agreement, the Merger and the other transactions contemplated by the Merger
Agreement, with such modifications to the Merger Agreement as the parties
thereto may make, or against a Third Party Acquisition, as the case may be. Such
proxy will be limited strictly to the power to vote the Shares in the manner set
forth in the preceding sentence and shall not extend to any other matters.
Without limiting the foregoing, in any such vote or other action pursuant to
such proxy, the Proxy Holders shall not have the right (and such proxy shall not
confer the right) to vote to reduce the Offer Price or otherwise modify or amend
the Merger Agreement to reduce the rights or benefits of the Company or any
stockholders of the Company (including Stockholder) under the Offer or the
Merger Agreement or to reduce the rights or obligations of Parent or Acquisition
thereunder.
(b) The proxy and power of attorney granted herein shall be
irrevocable during the term of this Agreement, shall be deemed to be coupled
with an interest sufficient in law to support an irrevocable proxy and shall
revoke all prior proxies granted by Stockholder. Stockholder will not grant any
proxy to any person which conflicts with the proxy granted herein, and any
attempt to do so will be void. The power of attorney granted herein is a durable
power of attorney and will survive the death or incapacity of Stockholder.
(c) If Stockholder fails for any reason to vote his, hers or
its Shares in accordance with the requirements of Section 1(b) hereof, then the
Proxy Holder shall have the right to vote the Shares at any meeting of the
Company's stockholders and in any action by written consent of the Company's
stockholders in accordance with the provisions of this Section 2. The vote of
the Proxy Holder will control in any conflict between his vote of such Shares
and a vote by Stockholder of such Shares.
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3. PURCHASE OPTION.
(a) Stockholder grants to Parent and Acquisition an
irrevocable option (the "Purchase Option") to purchase for cash, in the manner
set forth below, any or all of the Shares (and any shares of Company Common
Stock acquired by Stockholder after the date hereof) at a price (the "Exercise
Price") per share equal to the Offer Price. In the event of any stock dividends,
stock splits, recapitalizations, combinations, exchanges or shares or similar
transactions, the Offer Price shall be appropriately adjusted.
(b) (1) Subject to the conditions set forth in Section 3(d),
the Purchase Option may be exercised by Parent or Acquisition, in whole or in
part, at any time or from time to time after the occurrence of any Trigger Event
(as defined below). The Company and Stockholder shall notify Parent promptly in
writing of the occurrence of any Trigger Event. The giving of such notice by the
Company or Stockholder is not a condition to the right of Parent or Acquisition
to exercise the Purchase Option. In the event Parent or Acquisition wishes to
exercise the Purchase Option, Parent shall deliver to Stockholder a written
notice (an "Exercise Notice") specifying the total number of Shares it wishes to
purchase from Stockholder. Each closing of a purchase of Shares (a "Closing")
will occur at a place, on a date and at a time designated by Parent or
Acquisition in an Exercise Notice delivered at least two business days prior to
the date of the Closing.
(2) A "Trigger Event" means any one of the
following: (i) the Merger Agreement becomes terminable under circumstances that
entitle Parent or Acquisition to receive the liquidated damages under Section
7.3(a) of the Merger Agreement or fees and expenses under Section 7.3(b) of the
Merger Agreement (regardless of whether the Merger Agreement is actually
terminated and whether such liquidated damages or fees and expenses are then
actually paid); (ii) the Offer is consummated but, due to the failure of
Stockholder to validly tender and not withdraw all of the then outstanding
Beneficially Owned Shares, Acquisition has not accepted for payment or paid for
all of such shares of Company Common Stock; (iii) a tender or exchange offer for
at least 10% of the shares of Company Common Stock shall have been publicly
proposed to be made or shall have been made by another person; or (iv) it shall
have been publicly disclosed or Parent or Acquisition shall have otherwise
learned that (A) any person or "group" (as defined in Section 13(d)(3) of the
Exchange Act) (other than Parent or Acquisition) shall have acquired or proposed
to acquire beneficial ownership of more than 10% of any class or series of
capital stock of the Company (including the Company Common Stock), through the
acquisition of stock, the formation of a group or otherwise, or shall have been
granted any option, right or warrant, conditional or otherwise, to acquire
beneficial ownership of more than 10% of any class or series of capital stock of
the Company or any of its subsidiaries, or (B) any person or group (other than
Parent and Acquisition) shall have entered into or publicly offered to enter
into a definitive agreement or an agreement in principle with respect to a
merger, consolidation or other business combination with the Company or any of
its subsidiaries.
(3) If requested by Parent and Acquisition in the
Exercise Notice, Stockholder shall exercise all Options (to the extent
exercisable) and other rights (including
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conversion or exchange rights) Beneficially Owned by Stockholder and shall sell
or, if directed by Parent and Acquisition, tender the Shares acquired pursuant
to such exercise to Parent or Acquisition as provided in this Agreement.
(c) TERMINATION OF PURCHASE OPTION. The Purchase Option will terminate
upon the earliest of: (i) the Acceptance Date; (ii) termination of the Merger
Agreement other than upon, during the continuance of or after a Trigger Event;
or (iii) 90 days following any termination of the Merger Agreement upon, during
the continuance of or after a Trigger Event (or if, at the expiration of such 90
day period the Purchase Option cannot be exercised by reason of any applicable
judgment, decree, order, injunction, law or regulation, ten business days after
such impediment to exercise has been removed or has become final and not subject
to appeal). Upon the giving by Parent or Acquisition to Stockholder of the
Exercise Notice and the tender of the aggregate Exercise Price, Parent or
Acquisition, as the case may be, will be deemed to be the holder of record of
the Shares transferable upon such exercise, notwithstanding that the stock
transfer books of the Company are then closed or that certificates representing
such Shares have not been actually delivered to Parent.
(d) CONDITIONS TO CLOSING. The obligation of Stockholder to sell
Stockholder's Shares to Parent or Acquisition hereunder is subject to the
conditions that: (i) all waiting periods, if any, under the HSR Act, applicable
to the sale of the Shares or the acquisition of the Shares by Parent or
Acquisition, as the case may be, hereunder have expired or have been terminated;
(ii) all consents, approvals, orders or authorizations of, or registrations,
declarations or filings with, any court, administrative agency or other
Governmental Entity, if any, required in connection with sale of the Shares or
the acquisition of the Shares by Parent or Acquisition hereunder have been
obtained or made; and (iii) no preliminary or permanent injunction or other
order by any court of competent jurisdiction prohibiting or otherwise
restraining such sale or acquisition is in effect.
(e) CLOSING. At any Closing with respect to Shares Beneficially Owned
by Stockholder, (i) Stockholder will deliver to Parent, Acquisition or their
respective designee a certificate or certificates in definitive form
representing the number of the Shares designated by Parent or Acquisition, as
the case may be, in its Exercise Notice, such certificate to be registered in
the name of Parent, Acquisition or their respective designee and (ii) Parent or
Acquisition, as the case may be, will deliver to Stockholder the aggregate
Exercise Price for the Shares so designated and being purchased by wire transfer
of immediately available funds.
(f) REGISTRATION RIGHTS. (1) Following termination of the Merger
Agreement, Parent or Acquisition may in its sole discretion (but shall not be
required) by written notice (the "Registration Notice") to the Company request
the Company to register under the Securities Act all or any part of the shares
of Company Common Stock acquired under the Purchase Option (the "Registrable
Securities").
(2) The Company shall use commercially reasonable
efforts to effect, as promptly as practicable, the registration under the
Securities Act of the Registrable Securities; PROVIDED, HOWEVER, that (i) Parent
and Acquisition will be entitled to no more than one effective
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registration statement hereunder and (ii) the Company will not be required to
file any such registration statement during any period of time (not to exceed 40
days after such request in the case of clause (A) below or 90 days in the case
of clauses (B) and (C) below) when (A) the Company is in possession of material
non-public information that it reasonably believes would be detrimental to be
disclosed at such time and that such information would have to be disclosed if a
registration statement were filed at that time, (B) the Company is required
under the Securities Act to include audited financial statements for any period
in such registration statement and such financial statements are not yet
available for inclusion in such registration statement or (C) the Company
determines, in its reasonable judgment, that such registration would interfere
with any proposed financing, acquisition or other material transaction involving
the Company or any of its affiliates. The Company shall use its reasonable best
efforts to cause any Registrable Securities registered pursuant to this Section
3(f) to be qualified for sale under the securities or blue-sky laws of such
jurisdictions as Parent or Acquisition may reasonably request and shall continue
such registration or qualification in effect in such jurisdiction.
(3) The registration rights set forth in this
Section 3(f) are subject to the condition that Parent and Acquisition shall
provide the Company with such information with respect to their Registrable
Securities, the plans for the distribution thereof, and such other information
with respect to such holder as, in the reasonable judgment of counsel for the
Company, is necessary to enable the Company to include in such registration
statement all material facts required to be disclosed with respect to a
registration thereunder.
(4) A registration effected under this Section 3(f)
will be effected at the Company's expense, except for underwriting discounts and
commissions and the fees and the expenses of counsel to Parent and Acquisition
(which will be paid by Parent and Acquisition, and the Company shall provide to
the underwriters (in connection with an underwritten offering) such
documentation (including certificates, opinions of counsel and "comfort" letters
from auditors) as are customary in connection with underwritten offerings as
such underwriters may reasonably require. In connection with any such
registration, the parties agree (i) to indemnify each other and the underwriters
in the customary manner, (ii) to enter into an underwriting agreement in form
and substance customary for transactions of such type with the underwriters
participating in such offering and (iii) to take all further actions that will
be reasonably necessary to effect such registration and sale (including, if the
underwriters deem it necessary, participating in road-show presentations).
4. DIRECTOR MATTERS EXCLUDED. Parent and Acquisition acknowledge and
agree that no provision of this Agreement shall limit or otherwise restrict
Stockholder with respect to any act or omission that Stockholder may undertake
or authorize in his capacity as a director of the Company, including any vote
that Stockholder may make as a director of the Company with respect to any
matter presented to the Board of Directors of the Company.
5. OTHER COVENANTS, REPRESENTATIONS AND WARRANTIES. Stockholder hereby
represents and warrants to Parent and Acquisition as follows:
(a) OWNERSHIP OF SHARES. Stockholder is the Beneficial Owner
of all the
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Shares. On the date hereof, the Shares constitute all of the Shares Beneficially
Owned by Stockholder. Stockholder has voting power with respect to the matters
set forth in Section 1(b) hereof with respect to all of the Shares, with no
limitations, qualifications or restrictions on such rights.
(b) POWER; BINDING AGREEMENT. Stockholder has the legal
capacity, power and authority to enter into and perform all of its obligations
under this Agreement. The execution, delivery and performance of this Agreement
by Stockholder shall not violate any agreement or any court order to which
Stockholder is a party or is subject including any voting agreement or voting
trust. This Agreement has been duly and validly executed and delivered by
Stockholder.
(c) RESTRICTION ON TRANSFER, PROXIES AND NON-INTERFERENCE.
Except as expressly contemplated by this Agreement, Stockholder will not,
directly or indirectly: (i) offer for sale, sell, transfer, tender, pledge,
encumber, assign or otherwise dispose of, or enter into any contract, option or
other arrangement or understanding with respect to or consent to the offer for
sale, sale, transfer, tender, pledge, encumbrance, assignment or other
disposition of, any or all of the Shares or any interest therein; (ii) grant any
proxies or powers of attorney or deposit any Shares into a voting trust or enter
into a voting agreement with respect to any Shares; or (iii) take any action
that would make any representation or warranty of Stockholder contained herein
untrue or incorrect or have the effect of preventing or disabling Stockholder
from performing any of Stockholder's obligations under this Agreement.
(d) OTHER POTENTIAL ACQUIRORS. Stockholder (i) will
immediately cease any existing discussions or negotiations, if any, with any
persons conducted heretofore with respect to any acquisition of all or any
material portion of the assets of, or any equity interest in, the Company or any
of its subsidiaries, or any business combination with the Company or its
subsidiaries, in his, her or its capacity as such; (ii) from and after the date
hereof until the earlier of the termination of the Merger Agreement in
accordance with its terms and the Effective Time, will not, in such capacity,
directly or indirectly, initiate, solicit or knowingly encourage (including by
way of furnishing non-public information or assistance), or take any other
action to facilitate knowingly, any inquiries or the making of any Third Party
Acquisition; and (iii) shall promptly notify Parent of any proposals for, or
inquiries with respect to, a potential Third Party Acquisition received by
Stockholder or of which Stockholder otherwise has knowledge.
(e) RELIANCE BY PARENT AND ACQUISITION. Stockholder
understands and acknowledges that Parent and Acquisition are entering into the
Merger Agreement in reliance upon Stockholder's execution and delivery of this
Agreement.
6. STOP TRANSFER. Stockholder agrees with, and covenants to, Parent and
Acquisition that Stockholder will not request that the Company register the
transfer (book-entry or otherwise) of any certificate or uncertificated interest
representing any Shares, unless such transfer is made pursuant to this
Agreement. In the event of a stock dividend or distribution, or any change in
the Company Common Stock by reason of any stock dividend, split-up,
recapitalization, combination, exchange of shares or the like, the term "Shares"
shall be deemed to refer to and
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include the Shares as well as all such stock dividends and distributions and any
shares into which or for which any or all of the Shares may be changed or
exchanged.
7. TERMINATION. This Agreement (except as set forth in Section 3) shall
terminate upon the earliest to occur of: (a) the termination of the Merger
Agreement in accordance with its terms; (b) the Acceptance Date; and (c) July
31, 2000. No such termination of this Agreement shall relieve any party hereto
from any liability for any breach of this Agreement prior to termination.
8. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof.
(b) CERTAIN EVENTS. Stockholder agrees that this Agreement and
the obligations hereunder shall attach to the Shares and shall be binding upon
any person to which legal or beneficial ownership of any Shares shall pass,
whether by operation of law or otherwise. Notwithstanding any transfer of
Shares, the transferor shall remain liable for the performance of all
obligations under this Agreement of the transferor.
(c) ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by operation of law or
otherwise without the prior written consent of the other party; PROVIDED,
HOWEVER, that Parent may, in its sole discretion, assign its rights and
obligations hereunder to any direct wholly-owned subsidiary of Parent.
(d) AMENDMENTS, WAIVERS, ETC. This Agreement may not be
amended, changed, supplemented, waived or otherwise modified or terminated,
except upon the execution and delivery of a written agreement executed by the
parties hereto.
(e) NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if so given) by hand delivery, telecopy, or by
mail (registered or certified mail, postage prepaid, return receipt requested)
or by any nationally-recognized overnight courier service, such as Federal
Express, providing proof of delivery. Any such notice or communication shall be
deemed to have been delivered and received (i) in the case of hand delivery, on
the date of such delivery, (ii) in the case of telecopy, on the date sent if
confirmation of receipt is received and such notice is also promptly mailed by
registered or certified mail (return receipt requested), (iii) in the case of a
nationally-recognized overnight courier service, in circumstances under which
such courier guarantees next business day delivery, on the next business day
after the date when sent, and (iv) the case of mailing on the third business day
following that on which the piece of mail containing such communication is
posted. All communications hereunder shall be delivered to the respective
parties at the following addresses:
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If to Stockholder: at the address set forth on Schedule A
attached hereto
with copies to: Mark VII, Inc.
965 Ridge Lake Boulevard, Suite 100
Memphis, Tennessee 38120
Telecopier: (901) 767-1929
Attention: General Counsel
and
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10019
Telephone: (212) 259-6720
Facsimile: (212) 259-6333
Attention: Robert M. Smith
If to Parent or Acquisition: c/o Ocean Group plc
Ocean House
The Ring
Bracknell
Berkshire RG12 1AW
England
Telecopier: 011 44 134 44 452222
Attention: Group Commercial Director
with a copy to: Gibson, Dunn & Crutcher LLP
200 Park Avenue
New York, New York 10166
Telephone: (212) 351-4000
Telecopier: (212) 351-4035
Attention: Steven R. Finley
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the matter set forth above.
(f) SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law but if any provision of this Agreement becomes or is declared by
a court of competent jurisdiction to be invalid, illegal or unenforceable in any
respect under any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other provision or portion
of any provision in such jurisdiction, and this Agreement shall be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion
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of any provision had never been contained herein.
(g) SPECIFIC PERFORMANCE. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants or agreements
contained in this Agreement shall cause the other party to sustain damage for
which it would not have an adequate remedy at law for money damages, and
therefore each of the parties hereto agrees that in the event of any such breach
the aggrieved party shall be entitled to the remedy of specific performance of
such covenants and agreements and injunctive and other equitable relief in
addition to any other remedy to which it may be entitled, at law or in equity.
(h) NO WAIVER. The failure of any party hereto to exercise any
right, power or remedy provided under this Agreement or otherwise available in
respect hereof at law or in equity, or to insist upon compliance by any other
party hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by such
party of its right to exercise any such or other right, power or remedy or to
demand such compliance.
(i) GOVERNING LAW. This Agreement shall be governed and
construed in accordance with the laws of the State of Delaware, without giving
effect to the principles of conflicts of law thereof.
(j) COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original, but all of
which, taken together, shall constitute one and the same Agreement and shall
become effective when one or more of the counterparts have been signed by each
of the parties and delivered to the other parties.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
duly executed as of the day and year first above written.
MSAS GLOBAL LOGISTICS INC.,
a New York corporation
By: /s/ MICK P. FOUNTAIN
-------------------------------------
Name: Mick P. Fountain
Title: Regional Chief Executive
MSAS ACQUISITION CORPORATION,
a Delaware corporation
By: /s/ STUART A. YOUNG
-------------------------------------
Name: Stuart A. Young
Title: Secretary
STOCKHOLDER:
By: /s/ JAMES T. GRAVES
-------------------------------------
Name: James T. Graves
[SIGNATURE PAGE TO MSAS/MARK VII STOCKHOLDER TENDER AND
VOTING AND IRREVOCABLE PROXY]
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Exhibit (c)(5)
Execution Copy
TENDER AND VOTING AGREEMENT
AND
IRREVOCABLE PROXY
THIS TENDER AND VOTING AGREEMENT AND IRREVOCABLE PROXY, dated as of
July 27, 1999 (this "Agreement"), is entered into by and between MSAS Global
Logistics Inc., a New York corporation ("Parent"), and MSAS Acquisition
Corporation, a Delaware corporation and wholly-owned subsidiary of Parent
("Acquisition"), on the one hand, and William E. Greenwood ("Stockholder"), on
the other hand.
RECITALS
A. Concurrently herewith, Parent, Acquisition and Mark VII, Inc., a
Delaware corporation (the "Company"), have entered into an Agreement and Plan of
Merger, of even date herewith (as such agreement may hereafter be amended from
time to time, the "Merger Agreement"), pursuant to which Acquisition will make a
tender offer (the "Offer") for all outstanding shares of common stock, $0.05 par
value, of the Company ("Company Common Stock") at an offer price of $23 per
share, net to the seller in cash (such amount, or any greater amount per share
paid pursuant to the Offer, shall be referred to herein as the "Offer Price")
and, after Acquisition has accepted tendered shares for payment (the date on
which such acceptance occurs, the "Acceptance Date"), the Company and
Acquisition will merge with the Company as the surviving corporation and
wholly-owned subsidiary of Parent (the "Merger"). Initially capitalized and
other terms used but not defined herein shall have the meanings ascribed to them
in the Merger Agreement.
B. Stockholder Beneficially Owns (as defined herein) the number of
shares of Company Common Stock set forth opposite Stockholder's name on Schedule
A hereto (such shares, together with shares of Company Common Stock issuable
upon the exercise of options to purchase shares of Company Common Stock
(including the options set forth on Schedule A (the "Options")), being
collectively referred to herein as the "Shares").
C. As an inducement and a condition to entering into the Merger
Agreement, Parent and Acquisition have requested that Stockholder agree, and
Stockholder has agreed, to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
premises, representations, warranties, covenants and agreements contained
herein, the parties hereto hereby agree as follows:
1. PROVISIONS CONCERNING COMPANY COMMON STOCK.
<PAGE>
(a) Stockholder hereby agrees with Parent and Acquisition that
Stockholder will, promptly after the date of commencement of the Offer (but in
all events not later than five business days thereafter), tender to Acquisition
all outstanding Shares Beneficially Owned by Stockholder on such date (the
"Tendered Shares"). Stockholder further agrees to tender to Acquisition promptly
after Stockholder's acquisition thereof (but in all events not later than five
business days thereafter) all other shares of Company Common Stock acquired
and/or Beneficially Owned by Stockholder at any time prior to the Acceptance
Date or the date on which the Offer is terminated or expires without Acquisition
having accepted shares for payment. All such subsequently tendered Shares shall
constitute "Tendered Shares" for all purposes of this Agreement. Stockholder
agrees not to withdraw any of the Tendered Shares except following the earliest
of the termination of the Merger Agreement, the termination of the Offer or
expiration of the Offer without Acquisition's having accepted the Tendered
Shares for payment. Stockholder acknowledges and agrees that Acquisition's
obligation to accept for payment and pay for the Tendered Shares is subject to
all the terms and conditions of the Offer.
(b) Stockholder hereby agrees with Parent and Acquisition
that, subject to the receipt of proper notice and in the absence of a
preliminary injunction or other final order by any court or other administrative
or judicial authority barring such action, at any meeting of the Company's
stockholders, however called, or in connection with any written consent of the
Company's stockholders, Stockholder will vote the Shares Beneficially Owned by
Stockholder, whether heretofore owned or hereafter acquired: (i) in favor of
approval of the Merger Agreement and any actions required in furtherance of the
transactions contemplated thereby, including voting such shares in favor of the
election to the Company Board of each person designated by Parent for nomination
thereto pursuant to Section 1.3(a) of the Merger Agreement at any meeting of the
Company's stockholders called for the election of directors; (ii) against any
action or agreement that would result in a breach in any respect of any
covenant, representation or warranty or any other obligation or agreement of the
Company under the Merger Agreement; and (iii) except as otherwise agreed to in
writing in advance by Parent, against (A) any Third Party Acquisition, (B) any
change in a majority of the individuals who, as of the date hereof, constitute
the Board of Directors of the Company (other than as contemplated by Section 1.3
of the Merger Agreement), (C) any extraordinary corporate transaction, such as a
merger, consolidation or other business combination involving the Company or any
of its subsidiaries and any Third Party, (D) a sale, lease, transfer or
disposition of any assets of the Company's or any of its subsidiaries' business
outside the ordinary course of business, or any assets which are material to its
business whether or not in the ordinary course of business, or a reorganization,
recapitalization, dissolution or liquidation of the Company or any of its
subsidiaries, (E) any change in the present capitalization of the Company or any
amendment of the Company's Certificate of Incorporation or bylaws, (F) any other
material change in the Company's corporate structure or affecting its business,
or (G) any other action which is intended, or could reasonably be expected, to
impede, interfere with, delay, postpone or materially adversely affect the
Offer, the Merger or any of the other transactions contemplated by the Merger
Agreement, or any of the transactions contemplated by this Agreement.
Stockholder shall not enter into any agreement or understanding with any person
the effect of which would be inconsistent or violative of the provisions and
agreements contained herein. For purposes of this Agreement, "Beneficially
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Own" or "Beneficial Ownership" with respect to any securities shall mean
Stockholder having such ownership, control or power to direct the voting with
respect to, or otherwise enables Stockholder to legally act with respect to,
such securities as contemplated hereby, including pursuant to any agreement,
arrangement or understanding, whether or not in writing. Securities Beneficially
Owned by Stockholder shall include securities Beneficially Owned by all other
persons with whom Stockholder would constitute a "group" as within the meaning
of Section 13(d)(3) of the Exchange Act. Stockholder and Parent acknowledge and
agree that nothing in this Section 1(b) will require or be construed to require
Stockholder to take any action in his capacity as a member of the Company Board.
2. IRREVOCABLE PROXY.
(a) Stockholder hereby constitutes and appoints Acquisition,
which shall act by and through Ian Smith and Stuart Young (each, a "Proxy
Holder"), or either of them, with full power of substitution, its true and
lawful proxy and attorney-in-fact to vote at any meeting (and any adjournment or
postponement thereof) of the Company's stockholders called for purposes of
considering whether to approve the Merger Agreement, the Merger or any of the
other transactions contemplated by the Merger Agreement, or any Third Party
Acquisition, or to execute a written consent of stockholders in lieu of any such
meeting, all outstanding Shares Beneficially Owned by Stockholder as of the date
of such meeting or written consent in favor of the approval of the Merger
Agreement, the Merger and the other transactions contemplated by the Merger
Agreement, with such modifications to the Merger Agreement as the parties
thereto may make, or against a Third Party Acquisition, as the case may be. Such
proxy will be limited strictly to the power to vote the Shares in the manner set
forth in the preceding sentence and shall not extend to any other matters.
Without limiting the foregoing, in any such vote or other action pursuant to
such proxy, the Proxy Holders shall not have the right (and such proxy shall not
confer the right) to vote to reduce the Offer Price or otherwise modify or amend
the Merger Agreement to reduce the rights or benefits of the Company or any
stockholders of the Company (including Stockholder) under the Offer or the
Merger Agreement or to reduce the rights or obligations of Parent or Acquisition
thereunder.
(b) The proxy and power of attorney granted herein shall be
irrevocable during the term of this Agreement, shall be deemed to be coupled
with an interest sufficient in law to support an irrevocable proxy and shall
revoke all prior proxies granted by Stockholder. Stockholder will not grant any
proxy to any person which conflicts with the proxy granted herein, and any
attempt to do so will be void. The power of attorney granted herein is a durable
power of attorney and will survive the death or incapacity of Stockholder.
(c) If Stockholder fails for any reason to vote his, hers or
its Shares in accordance with the requirements of Section 1(b) hereof, then the
Proxy Holder shall have the right to vote the Shares at any meeting of the
Company's stockholders and in any action by written consent of the Company's
stockholders in accordance with the provisions of this Section 2. The vote of
the Proxy Holder will control in any conflict between his vote of such Shares
and a vote by Stockholder of such Shares.
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3. PURCHASE OPTION.
(a) Stockholder grants to Parent and Acquisition an
irrevocable option (the "Purchase Option") to purchase for cash, in the manner
set forth below, any or all of the Shares (and any shares of Company Common
Stock acquired by Stockholder after the date hereof) at a price (the "Exercise
Price") per share equal to the Offer Price. In the event of any stock dividends,
stock splits, recapitalizations, combinations, exchanges or shares or similar
transactions, the Offer Price shall be appropriately adjusted.
(b) (1) Subject to the conditions set forth in Section 3(d),
the Purchase Option may be exercised by Parent or Acquisition, in whole or in
part, at any time or from time to time after the occurrence of any Trigger Event
(as defined below). The Company and Stockholder shall notify Parent promptly in
writing of the occurrence of any Trigger Event. The giving of such notice by the
Company or Stockholder is not a condition to the right of Parent or Acquisition
to exercise the Purchase Option. In the event Parent or Acquisition wishes to
exercise the Purchase Option, Parent shall deliver to Stockholder a written
notice (an "Exercise Notice") specifying the total number of Shares it wishes to
purchase from Stockholder. Each closing of a purchase of Shares (a "Closing")
will occur at a place, on a date and at a time designated by Parent or
Acquisition in an Exercise Notice delivered at least two business days prior to
the date of the Closing.
(2) A "Trigger Event" means any one of the following:
(i) the Merger Agreement becomes terminable under circumstances that entitle
Parent or Acquisition to receive the liquidated damages under Section 7.3(a) of
the Merger Agreement or fees and expenses under Section 7.3(b) of the Merger
Agreement (regardless of whether the Merger Agreement is actually terminated and
whether such liquidated damages or fees and expenses are then actually paid);
(ii) the Offer is consummated but, due to the failure of Stockholder to validly
tender and not withdraw all of the then outstanding Beneficially Owned Shares,
Acquisition has not accepted for payment or paid for all of such shares of
Company Common Stock; (iii) a tender or exchange offer for at least 10% of the
shares of Company Common Stock shall have been publicly proposed to be made or
shall have been made by another person; or (iv) it shall have been publicly
disclosed or Parent or Acquisition shall have otherwise learned that (A) any
person or "group" (as defined in Section 13(d)(3) of the Exchange Act) (other
than Parent or Acquisition) shall have acquired or proposed to acquire
beneficial ownership of more than 10% of any class or series of capital stock of
the Company (including the Company Common Stock), through the acquisition of
stock, the formation of a group or otherwise, or shall have been granted any
option, right or warrant, conditional or otherwise, to acquire beneficial
ownership of more than 10% of any class or series of capital stock of the
Company or any of its subsidiaries, or (B) any person or group (other than
Parent and Acquisition) shall have entered into or publicly offered to enter
into a definitive agreement or an agreement in principle with respect to a
merger, consolidation or other business combination with the Company or any of
its subsidiaries.
(3) If requested by Parent and Acquisition in the
Exercise Notice, Stockholder shall exercise all Options (to the extent
exercisable) and other rights (including
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conversion or exchange rights)Beneficially Owned by Stockholder and shall sell
or, if directed by Parent and Acquisition, tender the Shares acquired pursuant
to such exercise to Parent or Acquisition as provided in this Agreement.
(c) TERMINATION OF PURCHASE OPTION. The Purchase Option will terminate
upon the earliest of: (i) the Acceptance Date; (ii) termination of the Merger
Agreement other than upon, during the continuance of or after a Trigger Event;
or (iii) 90 days following any termination of the Merger Agreement upon, during
the continuance of or after a Trigger Event (or if, at the expiration of such 90
day period the Purchase Option cannot be exercised by reason of any applicable
judgment, decree, order, injunction, law or regulation, ten business days after
such impediment to exercise has been removed or has become final and not subject
to appeal). Upon the giving by Parent or Acquisition to Stockholder of the
Exercise Notice and the tender of the aggregate Exercise Price, Parent or
Acquisition, as the case may be, will be deemed to be the holder of record of
the Shares transferable upon such exercise, notwithstanding that the stock
transfer books of the Company are then closed or that certificates representing
such Shares have not been actually delivered to Parent.
(d) CONDITIONS TO CLOSING. The obligation of Stockholder to sell
Stockholder's Shares to Parent or Acquisition hereunder is subject to the
conditions that: (i) all waiting periods, if any, under the HSR Act, applicable
to the sale of the Shares or the acquisition of the Shares by Parent or
Acquisition, as the case may be, hereunder have expired or have been terminated;
(ii) all consents, approvals, orders or authorizations of, or registrations,
declarations or filings with, any court, administrative agency or other
Governmental Entity, if any, required in connection with sale of the Shares or
the acquisition of the Shares by Parent or Acquisition hereunder have been
obtained or made; and (iii) no preliminary or permanent injunction or other
order by any court of competent jurisdiction prohibiting or otherwise
restraining such sale or acquisition is in effect.
(e) CLOSING. At any Closing with respect to Shares Beneficially Owned
by Stockholder, (i) Stockholder will deliver to Parent, Acquisition or their
respective designee a certificate or certificates in definitive form
representing the number of the Shares designated by Parent or Acquisition, as
the case may be, in its Exercise Notice, such certificate to be registered in
the name of Parent, Acquisition or their respective designee and (ii) Parent or
Acquisition, as the case may be, will deliver to Stockholder the aggregate
Exercise Price for the Shares so designated and being purchased by wire transfer
of immediately available funds.
(f) REGISTRATION RIGHTS. (1) Following termination of the Merger
Agreement, Parent or Acquisition may in its sole discretion (but shall not be
required) by written notice (the "Registration Notice") to the Company request
the Company to register under the Securities Act all or any part of the shares
of Company Common Stock acquired under the Purchase Option (the "Registrable
Securities").
(2) The Company shall use commercially reasonable
efforts to effect, as promptly as practicable, the registration under the
Securities Act of the Registrable Securities; PROVIDED, HOWEVER, that (i) Parent
and Acquisition will be entitled to no more than one effective
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registration statement hereunder and (ii) the Company will not be required to
file any such registration statement during any period of time (not to exceed 40
days after such request in the case of clause (A) below or 90 days in the case
of clauses (B) and (C) below) when (A) the Company is in possession of material
non-public information that it reasonably believes would be detrimental to be
disclosed at such time and that such information would have to be disclosed if a
registration statement were filed at that time, (B) the Company is required
under the Securities Act to include audited financial statements for any period
in such registration statement and such financial statements are not yet
available for inclusion in such registration statement or (C) the Company
determines, in its reasonable judgment, that such registration would interfere
with any proposed financing, acquisition or other material transaction involving
the Company or any of its affiliates. The Company shall use its reasonable best
efforts to cause any Registrable Securities registered pursuant to this Section
3(f) to be qualified for sale under the securities or blue-sky laws of such
jurisdictions as Parent or Acquisition may reasonably request and shall continue
such registration or qualification in effect in such jurisdiction.
(3) The registration rights set forth in this Section
3(f) are subject to the condition that Parent and Acquisition shall provide the
Company with such information with respect to their Registrable Securities, the
plans for the distribution thereof, and such other information with respect to
such holder as, in the reasonable judgment of counsel for the Company, is
necessary to enable the Company to include in such registration statement all
material facts required to be disclosed with respect to a registration
thereunder.
(4) A registration effected under this Section 3(f)
will be effected at the Company's expense, except for underwriting discounts and
commissions and the fees and the expenses of counsel to Parent and Acquisition
(which will be paid by Parent and Acquisition, and the Company shall provide to
the underwriters (in connection with an underwritten offering) such
documentation (including certificates, opinions of counsel and "comfort" letters
from auditors) as are customary in connection with underwritten offerings as
such underwriters may reasonably require. In connection with any such
registration, the parties agree (i) to indemnify each other and the underwriters
in the customary manner, (ii) to enter into an underwriting agreement in form
and substance customary for transactions of such type with the underwriters
participating in such offering and (iii) to take all further actions that will
be reasonably necessary to effect such registration and sale (including, if the
underwriters deem it necessary, participating in road-show presentations).
4. DIRECTOR MATTERS EXCLUDED. Parent and Acquisition acknowledge and
agree that no provision of this Agreement shall limit or otherwise restrict
Stockholder with respect to any act or omission that Stockholder may undertake
or authorize in his capacity as a director of the Company, including any vote
that Stockholder may make as a director of the Company with respect to any
matter presented to the Board of Directors of the Company.
5. OTHER COVENANTS, REPRESENTATIONS AND WARRANTIES. Stockholder hereby
represents and warrants to Parent and Acquisition as follows:
(a) OWNERSHIP OF SHARES. Stockholder is the Beneficial Owner
of all the
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Shares. On the date hereof, the Shares constitute all of the Shares
Beneficially Owned by Stockholder. Stockholder has voting power with respect to
the matters set forth in Section 1(b) hereof with respect to all of the Shares,
with no limitations, qualifications or restrictions on such rights.
(b) POWER; BINDING AGREEMENT. Stockholder has the legal
capacity, power and authority to enter into and perform all of its obligations
under this Agreement. The execution, delivery and performance of this Agreement
by Stockholder shall not violate any agreement or any court order to which
Stockholder is a party or is subject including any voting agreement or voting
trust. This Agreement has been duly and validly executed and delivered by
Stockholder.
(c) RESTRICTION ON TRANSFER, PROXIES AND NON-INTERFERENCE.
Except as expressly contemplated by this Agreement, Stockholder will not,
directly or indirectly: (i) offer for sale, sell, transfer, tender, pledge,
encumber, assign or otherwise dispose of, or enter into any contract, option or
other arrangement or understanding with respect to or consent to the offer for
sale, sale, transfer, tender, pledge, encumbrance, assignment or other
disposition of, any or all of the Shares or any interest therein; (ii) grant any
proxies or powers of attorney or deposit any Shares into a voting trust or enter
into a voting agreement with respect to any Shares; or (iii) take any action
that would make any representation or warranty of Stockholder contained herein
untrue or incorrect or have the effect of preventing or disabling Stockholder
from performing any of Stockholder's obligations under this Agreement.
(d) OTHER POTENTIAL ACQUIRORS. Stockholder (i) will
immediately cease any existing discussions or negotiations, if any, with any
persons conducted heretofore with respect to any acquisition of all or any
material portion of the assets of, or any equity interest in, the Company or any
of its subsidiaries, or any business combination with the Company or its
subsidiaries, in his, her or its capacity as such; (ii) from and after the date
hereof until the earlier of the termination of the Merger Agreement in
accordance with its terms and the Effective Time, will not, in such capacity,
directly or indirectly, initiate, solicit or knowingly encourage (including by
way of furnishing non-public information or assistance), or take any other
action to facilitate knowingly, any inquiries or the making of any Third Party
Acquisition; and (iii) shall promptly notify Parent of any proposals for, or
inquiries with respect to, a potential Third Party Acquisition received by
Stockholder or of which Stockholder otherwise has knowledge.
(e) RELIANCE BY PARENT AND ACQUISITION. Stockholder
understands and acknowledges that Parent and Acquisition are entering into the
Merger Agreement in reliance upon Stockholder's execution and delivery of this
Agreement.
6. STOP TRANSFER. Stockholder agrees with, and covenants to, Parent and
Acquisition that Stockholder will not request that the Company register the
transfer (book-entry or otherwise) of any certificate or uncertificated interest
representing any Shares, unless such transfer is made pursuant to this
Agreement. In the event of a stock dividend or distribution, or any change in
the Company Common Stock by reason of any stock dividend, split-up,
recapitalization, combination, exchange of shares or the like, the term "Shares"
shall be deemed to refer to and
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include the Shares as well as all such stock dividends and distributions and
any shares into which or for which any or all of the Shares may be changed or
exchanged.
7. TERMINATION. This Agreement (except as set forth in Section 3) shall
terminate upon the earliest to occur of: (a) the termination of the Merger
Agreement in accordance with its terms; (b) the Acceptance Date; and (c) July
31, 2000. No such termination of this Agreement shall relieve any party hereto
from any liability for any breach of this Agreement prior to termination.
8. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof.
(b) CERTAIN EVENTS. Stockholder agrees that this Agreement and
the obligations hereunder shall attach to the Shares and shall be binding upon
any person to which legal or beneficial ownership of any Shares shall pass,
whether by operation of law or otherwise. Notwithstanding any transfer of
Shares, the transferor shall remain liable for the performance of all
obligations under this Agreement of the transferor.
(c) ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by operation of law or
otherwise without the prior written consent of the other party; PROVIDED,
HOWEVER, that Parent may, in its sole discretion, assign its rights and
obligations hereunder to any direct wholly-owned subsidiary of Parent.
(d) AMENDMENTS, WAIVERS, ETC. This Agreement may not be
amended, changed, supplemented, waived or otherwise modified or terminated,
except upon the execution and delivery of a written agreement executed by the
parties hereto.
(e) NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if so given) by hand delivery, telecopy, or by
mail (registered or certified mail, postage prepaid, return receipt requested)
or by any nationally-recognized overnight courier service, such as Federal
Express, providing proof of delivery. Any such notice or communication shall be
deemed to have been delivered and received (i) in the case of hand delivery, on
the date of such delivery, (ii) in the case of telecopy, on the date sent if
confirmation of receipt is received and such notice is also promptly mailed by
registered or certified mail (return receipt requested), (iii) in the case of a
nationally-recognized overnight courier service, in circumstances under which
such courier guarantees next business day delivery, on the next business day
after the date when sent, and (iv) the case of mailing on the third business day
following that on which the piece of mail containing such communication is
posted. All communications hereunder shall be delivered to the respective
parties at the following addresses:
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If to Stockholder: at the address set forth on Schedule A attached hereto
with copies to: Mark VII, Inc.
965 Ridge Lake Boulevard, Suite 100
Memphis, Tennessee 38120
Telecopier: (901) 767-1929
Attention: General Counsel
and
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10019
Telephone: (212) 259-6720
Facsimile: (212) 259-6333
Attention: Robert M. Smith
If to Parent or Acquisition: c/o Ocean Group plc
Ocean House
The Ring
Bracknell
Berkshire RG12 1AW
England
Telecopier: 011 44 134 44 452222
Attention: Group Commercial Director
with a copy to: Gibson, Dunn & Crutcher LLP
200 Park Avenue
New York, New York 10166
Telephone: (212) 351-4000
Telecopier: (212) 351-4035
Attention: Steven R. Finley
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the matter set forth above.
(f) SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law but if any provision of this Agreement becomes or is declared by
a court of competent jurisdiction to be invalid, illegal or unenforceable in any
respect under any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other provision or portion
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<PAGE>
of any provision in such jurisdiction, and this Agreement shall be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never been contained
herein.
(g) SPECIFIC PERFORMANCE. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants or agreements
contained in this Agreement shall cause the other party to sustain damage for
which it would not have an adequate remedy at law for money damages, and
therefore each of the parties hereto agrees that in the event of any such breach
the aggrieved party shall be entitled to the remedy of specific performance of
such covenants and agreements and injunctive and other equitable relief in
addition to any other remedy to which it may be entitled, at law or in equity.
(h) NO WAIVER. The failure of any party hereto to exercise any
right, power or remedy provided under this Agreement or otherwise available in
respect hereof at law or in equity, or to insist upon compliance by any other
party hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by such
party of its right to exercise any such or other right, power or remedy or to
demand such compliance.
(i) GOVERNING LAW. This Agreement shall be governed and
construed in accordance with the laws of the State of Delaware, without giving
effect to the principles of conflicts of law thereof.
(j) COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original, but all of
which, taken together, shall constitute one and the same Agreement and shall
become effective when one or more of the counterparts have been signed by each
of the parties and delivered to the other parties.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
duly executed as of the day and year first above written.
MSAS GLOBAL LOGISTICS INC.,
a New York corporation
By: /S/ MICK P. FOUNTAIN
--------------------
Name: Mick P. Fountain
Title: Regional Chief Executive
MSAS ACQUISITION CORPORATION,
a Delaware corporation
By: /S/ STUART A. YOUNG
-----------------------
Name: Stuart A. Young
Title: Secretary
STOCKHOLDER:
By:/S/ WILLIAM E. GREENWOOD
-------------------------
Name: William E. Greenwood
[SIGNATURE PAGE TO MSAS/MARK VII STOCKHOLDER TENDER AND
VOTING AND IRREVOCABLE PROXY]
11
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Exhibit (c)(6)
Execution Copy
TENDER AND VOTING AGREEMENT
AND
IRREVOCABLE PROXY
THIS TENDER AND VOTING AGREEMENT AND IRREVOCABLE PROXY, dated as of
July 27, 1999 (this "Agreement"), is entered into by and between MSAS Global
Logistics Inc., a New York corporation ("Parent"), and MSAS Acquisition
Corporation, a Delaware corporation and wholly-owned subsidiary of Parent
("Acquisition"), on the one hand, and Thomas J. Fitzgerald ("Stockholder"), on
the other hand.
RECITALS
A. Concurrently herewith, Parent, Acquisition and Mark VII, Inc., a
Delaware corporation (the "Company"), have entered into an Agreement and Plan of
Merger, of even date herewith (as such agreement may hereafter be amended from
time to time, the "Merger Agreement"), pursuant to which Acquisition will make a
tender offer (the "Offer") for all outstanding shares of common stock, $0.05 par
value, of the Company ("Company Common Stock") at an offer price of $23 per
share, net to the seller in cash (such amount, or any greater amount per share
paid pursuant to the Offer, shall be referred to herein as the "Offer Price")
and, after Acquisition has accepted tendered shares for payment (the date on
which such acceptance occurs, the "Acceptance Date"), the Company and
Acquisition will merge with the Company as the surviving corporation and
wholly-owned subsidiary of Parent (the "Merger"). Initially capitalized and
other terms used but not defined herein shall have the meanings ascribed to them
in the Merger Agreement.
B. Stockholder Beneficially Owns (as defined herein) the number of
shares of Company Common Stock set forth opposite Stockholder's name on Schedule
A hereto (such shares, together with shares of Company Common Stock issuable
upon the exercise of options to purchase shares of Company Common Stock
(including the options set forth on Schedule A (the "Options")), being
collectively referred to herein as the "Shares").
C. As an inducement and a condition to entering into the Merger
Agreement, Parent and Acquisition have requested that Stockholder agree, and
Stockholder has agreed, to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
premises, representations, warranties, covenants and agreements contained
herein, the parties hereto hereby agree as follows:
1. PROVISIONS CONCERNING COMPANY COMMON STOCK.
<PAGE>
(a) Stockholder hereby agrees with Parent and Acquisition that
Stockholder will, promptly after the date of commencement of the Offer (but in
all events not later than five business days thereafter), tender to Acquisition
all outstanding Shares Beneficially Owned by Stockholder on such date (the
"Tendered Shares"). Stockholder further agrees to tender to Acquisition promptly
after Stockholder's acquisition thereof (but in all events not later than five
business days thereafter) all other shares of Company Common Stock acquired
and/or Beneficially Owned by Stockholder at any time prior to the Acceptance
Date or the date on which the Offer is terminated or expires without Acquisition
having accepted shares for payment. All such subsequently tendered Shares shall
constitute "Tendered Shares" for all purposes of this Agreement. Stockholder
agrees not to withdraw any of the Tendered Shares except following the earliest
of the termination of the Merger Agreement, the termination of the Offer or
expiration of the Offer without Acquisition's having accepted the Tendered
Shares for payment. Stockholder acknowledges and agrees that Acquisition's
obligation to accept for payment and pay for the Tendered Shares is subject to
all the terms and conditions of the Offer.
(b) Stockholder hereby agrees with Parent and Acquisition
that, subject to the receipt of proper notice and in the absence of a
preliminary injunction or other final order by any court or other administrative
or judicial authority barring such action, at any meeting of the Company's
stockholders, however called, or in connection with any written consent of the
Company's stockholders, Stockholder will vote the Shares Beneficially Owned by
Stockholder, whether heretofore owned or hereafter acquired: (i) in favor of
approval of the Merger Agreement and any actions required in furtherance of the
transactions contemplated thereby, including voting such shares in favor of the
election to the Company Board of each person designated by Parent for nomination
thereto pursuant to Section 1.3(a) of the Merger Agreement at any meeting of the
Company's stockholders called for the election of directors; (ii) against any
action or agreement that would result in a breach in any respect of any
covenant, representation or warranty or any other obligation or agreement of the
Company under the Merger Agreement; and (iii) except as otherwise agreed to in
writing in advance by Parent, against (A) any Third Party Acquisition, (B) any
change in a majority of the individuals who, as of the date hereof, constitute
the Board of Directors of the Company (other than as contemplated by Section 1.3
of the Merger Agreement), (C) any extraordinary corporate transaction, such as a
merger, consolidation or other business combination involving the Company or any
of its subsidiaries and any Third Party, (D) a sale, lease, transfer or
disposition of any assets of the Company's or any of its subsidiaries' business
outside the ordinary course of business, or any assets which are material to its
business whether or not in the ordinary course of business, or a reorganization,
recapitalization, dissolution or liquidation of the Company or any of its
subsidiaries, (E) any change in the present capitalization of the Company or any
amendment of the Company's Certificate of Incorporation or bylaws, (F) any other
material change in the Company's corporate structure or affecting its business,
or (G) any other action which is intended, or could reasonably be expected, to
impede, interfere with, delay, postpone or materially adversely affect the
Offer, the Merger or any of the other transactions contemplated by the Merger
Agreement, or any of the transactions contemplated by this Agreement.
Stockholder shall not enter into any agreement or understanding with any person
the effect of which would be inconsistent or violative of the provisions and
agreements contained herein. For purposes of this Agreement, "Beneficially
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<PAGE>
Own" or "Beneficial Ownership" with respect to any securities shall mean
Stockholder having such ownership, control or power to direct the voting with
respect to, or otherwise enables Stockholder to legally act with respect to,
such securities as contemplated hereby, including pursuant to any agreement,
arrangement or understanding, whether or not in writing. Securities Beneficially
Owned by Stockholder shall include securities Beneficially Owned by all other
persons with whom Stockholder would constitute a "group" as within the meaning
of Section 13(d)(3) of the Exchange Act. Stockholder and Parent acknowledge and
agree that nothing in this Section 1(b) will require or be construed to require
Stockholder to take any action in his capacity as a member of the Company Board.
2. IRREVOCABLE PROXY.
(a) Stockholder hereby constitutes and appoints Acquisition,
which shall act by and through Ian Smith and Stuart Young (each, a "Proxy
Holder"), or either of them, with full power of substitution, its true and
lawful proxy and attorney-in-fact to vote at any meeting (and any adjournment or
postponement thereof) of the Company's stockholders called for purposes of
considering whether to approve the Merger Agreement, the Merger or any of the
other transactions contemplated by the Merger Agreement, or any Third Party
Acquisition, or to execute a written consent of stockholders in lieu of any such
meeting, all outstanding Shares Beneficially Owned by Stockholder as of the date
of such meeting or written consent in favor of the approval of the Merger
Agreement, the Merger and the other transactions contemplated by the Merger
Agreement, with such modifications to the Merger Agreement as the parties
thereto may make, or against a Third Party Acquisition, as the case may be. Such
proxy will be limited strictly to the power to vote the Shares in the manner set
forth in the preceding sentence and shall not extend to any other matters.
Without limiting the foregoing, in any such vote or other action pursuant to
such proxy, the Proxy Holders shall not have the right (and such proxy shall not
confer the right) to vote to reduce the Offer Price or otherwise modify or amend
the Merger Agreement to reduce the rights or benefits of the Company or any
stockholders of the Company (including Stockholder) under the Offer or the
Merger Agreement or to reduce the rights or obligations of Parent or Acquisition
thereunder.
(b) The proxy and power of attorney granted herein shall be
irrevocable during the term of this Agreement, shall be deemed to be coupled
with an interest sufficient in law to support an irrevocable proxy and shall
revoke all prior proxies granted by Stockholder. Stockholder will not grant any
proxy to any person which conflicts with the proxy granted herein, and any
attempt to do so will be void. The power of attorney granted herein is a durable
power of attorney and will survive the death or incapacity of Stockholder.
(c) If Stockholder fails for any reason to vote his, hers or
its Shares in accordance with the requirements of Section 1(b) hereof, then the
Proxy Holder shall have the right to vote the Shares at any meeting of the
Company's stockholders and in any action by written consent of the Company's
stockholders in accordance with the provisions of this Section 2. The vote of
the Proxy Holder will control in any conflict between his vote of such Shares
and a vote by Stockholder of such Shares.
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<PAGE>
3. PURCHASE OPTION.
(a) Stockholder grants to Parent and Acquisition an
irrevocable option (the "Purchase Option") to purchase for cash, in the manner
set forth below, any or all of the Shares (and any shares of Company Common
Stock acquired by Stockholder after the date hereof) at a price (the "Exercise
Price") per share equal to the Offer Price. In the event of any stock dividends,
stock splits, recapitalizations, combinations, exchanges or shares or similar
transactions, the Offer Price shall be appropriately adjusted.
(b) (1) Subject to the conditions set forth in Section 3(d),
the Purchase Option may be exercised by Parent or Acquisition, in whole or in
part, at any time or from time to time after the occurrence of any Trigger Event
(as defined below). The Company and Stockholder shall notify Parent promptly in
writing of the occurrence of any Trigger Event. The giving of such notice by the
Company or Stockholder is not a condition to the right of Parent or Acquisition
to exercise the Purchase Option. In the event Parent or Acquisition wishes to
exercise the Purchase Option, Parent shall deliver to Stockholder a written
notice (an "Exercise Notice") specifying the total number of Shares it wishes to
purchase from Stockholder. Each closing of a purchase of Shares (a "Closing")
will occur at a place, on a date and at a time designated by Parent or
Acquisition in an Exercise Notice delivered at least two business days prior to
the date of the Closing.
(2) A "Trigger Event" means any one of the following:
(i) the Merger Agreement becomes terminable under circumstances that entitle
Parent or Acquisition to receive the liquidated damages under Section 7.3(a) of
the Merger Agreement or fees and expenses under Section 7.3(b) of the Merger
Agreement (regardless of whether the Merger Agreement is actually terminated and
whether such liquidated damages or fees and expenses are then actually paid);
(ii) the Offer is consummated but, due to the failure of Stockholder to validly
tender and not withdraw all of the then outstanding Beneficially Owned Shares,
Acquisition has not accepted for payment or paid for all of such shares of
Company Common Stock; (iii) a tender or exchange offer for at least 10% of the
shares of Company Common Stock shall have been publicly proposed to be made or
shall have been made by another person; or (iv) it shall have been publicly
disclosed or Parent or Acquisition shall have otherwise learned that (A) any
person or "group" (as defined in Section 13(d)(3) of the Exchange Act) (other
than Parent or Acquisition) shall have acquired or proposed to acquire
beneficial ownership of more than 10% of any class or series of capital stock of
the Company (including the Company Common Stock), through the acquisition of
stock, the formation of a group or otherwise, or shall have been granted any
option, right or warrant, conditional or otherwise, to acquire beneficial
ownership of more than 10% of any class or series of capital stock of the
Company or any of its subsidiaries, or (B) any person or group (other than
Parent and Acquisition) shall have entered into or publicly offered to enter
into a definitive agreement or an agreement in principle with respect to a
merger, consolidation or other business combination with the Company or any of
its subsidiaries.
(3) If requested by Parent and Acquisition in the
Exercise Notice, Stockholder shall exercise all Options (to the extent
exercisable) and other rights (including
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<PAGE>
conversion or exchange rights) Beneficially Owned by Stockholder and shall sell
or, if directed by Parent and Acquisition, tender the Shares acquired pursuant
to such exercise to Parent or Acquisition as provided in this Agreement.
(c) TERMINATION OF PURCHASE OPTION. The Purchase Option will terminate
upon the earliest of: (i) the Acceptance Date; (ii) termination of the Merger
Agreement other than upon, during the continuance of or after a Trigger Event;
or (iii) 90 days following any termination of the Merger Agreement upon, during
the continuance of or after a Trigger Event (or if, at the expiration of such 90
day period the Purchase Option cannot be exercised by reason of any applicable
judgment, decree, order, injunction, law or regulation, ten business days after
such impediment to exercise has been removed or has become final and not subject
to appeal). Upon the giving by Parent or Acquisition to Stockholder of the
Exercise Notice and the tender of the aggregate Exercise Price, Parent or
Acquisition, as the case may be, will be deemed to be the holder of record of
the Shares transferable upon such exercise, notwithstanding that the stock
transfer books of the Company are then closed or that certificates representing
such Shares have not been actually delivered to Parent.
(d) CONDITIONS TO CLOSING. The obligation of Stockholder to sell
Stockholder's Shares to Parent or Acquisition hereunder is subject to the
conditions that: (i) all waiting periods, if any, under the HSR Act, applicable
to the sale of the Shares or the acquisition of the Shares by Parent or
Acquisition, as the case may be, hereunder have expired or have been terminated;
(ii) all consents, approvals, orders or authorizations of, or registrations,
declarations or filings with, any court, administrative agency or other
Governmental Entity, if any, required in connection with sale of the Shares or
the acquisition of the Shares by Parent or Acquisition hereunder have been
obtained or made; and (iii) no preliminary or permanent injunction or other
order by any court of competent jurisdiction prohibiting or otherwise
restraining such sale or acquisition is in effect.
(e) CLOSING. At any Closing with respect to Shares Beneficially Owned
by Stockholder, (i) Stockholder will deliver to Parent, Acquisition or their
respective designee a certificate or certificates in definitive form
representing the number of the Shares designated by Parent or Acquisition, as
the case may be, in its Exercise Notice, such certificate to be registered in
the name of Parent, Acquisition or their respective designee and (ii) Parent or
Acquisition, as the case may be, will deliver to Stockholder the aggregate
Exercise Price for the Shares so designated and being purchased by wire transfer
of immediately available funds.
(f) REGISTRATION RIGHTS. (1) Following termination of the Merger
Agreement, Parent or Acquisition may in its sole discretion (but shall not be
required) by written notice (the "Registration Notice") to the Company request
the Company to register under the Securities Act all or any part of the shares
of Company Common Stock acquired under the Purchase Option (the "Registrable
Securities").
(2) The Company shall use commercially reasonable efforts
to effect, as promptly as practicable, the registration under the Securities Act
of the Registrable Securities; PROVIDED, HOWEVER, that (i) Parent and
Acquisition will be entitled to no more than one effective
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<PAGE>
registration statement hereunder and (ii) the Company will not be required to
file any such registration statement during any period of time (not to exceed 40
days after such request in the case of clause (A) below or 90 days in the case
of clauses (B) and (C) below) when (A) the Company is in possession of material
non-public information that it reasonably believes would be detrimental to be
disclosed at such time and that such information would have to be disclosed if a
registration statement were filed at that time, (B) the Company is required
under the Securities Act to include audited financial statements for any period
in such registration statement and such financial statements are not yet
available for inclusion in such registration statement or (C) the Company
determines, in its reasonable judgment, that such registration would interfere
with any proposed financing, acquisition or other material transaction involving
the Company or any of its affiliates. The Company shall use its reasonable best
efforts to cause any Registrable Securities registered pursuant to this Section
3(f) to be qualified for sale under the securities or blue-sky laws of such
jurisdictions as Parent or Acquisition may reasonably request and shall continue
such registration or qualification in effect in such jurisdiction.
(3) The registration rights set forth in this
Section 3(f) are subject to the condition that Parent and Acquisition shall
provide the Company with such information with respect to their Registrable
Securities, the plans for the distribution thereof, and such other information
with respect to such holder as, in the reasonable judgment of counsel for the
Company, is necessary to enable the Company to include in such registration
statement all material facts required to be disclosed with respect to a
registration thereunder.
(4) A registration effected under this Section 3(f) will
be effected at the Company's expense, except for underwriting discounts and
commissions and the fees and the expenses of counsel to Parent and Acquisition
(which will be paid by Parent and Acquisition, and the Company shall provide to
the underwriters (in connection with an underwritten offering) such
documentation (including certificates, opinions of counsel and "comfort" letters
from auditors) as are customary in connection with underwritten offerings as
such underwriters may reasonably require. In connection with any such
registration, the parties agree (i) to indemnify each other and the underwriters
in the customary manner, (ii) to enter into an underwriting agreement in form
and substance customary for transactions of such type with the underwriters
participating in such offering and (iii) to take all further actions that will
be reasonably necessary to effect such registration and sale (including, if the
underwriters deem it necessary, participating in road-show presentations).
4. DIRECTOR MATTERS EXCLUDED. Parent and Acquisition acknowledge and
agree that no provision of this Agreement shall limit or otherwise restrict
Stockholder with respect to any act or omission that Stockholder may undertake
or authorize in his capacity as a director of the Company, including any vote
that Stockholder may make as a director of the Company with respect to any
matter presented to the Board of Directors of the Company.
5. OTHER COVENANTS, REPRESENTATIONS AND WARRANTIES. Stockholder hereby
represents and warrants to Parent and Acquisition as follows:
(a) OWNERSHIP OF SHARES. Stockholder is the Beneficial Owner
of all the
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<PAGE>
Shares. On the date hereof, the Shares constitute all of the Shares
Beneficially Owned by Stockholder. Stockholder has voting power with respect to
the matters set forth in Section 1(b) hereof with respect to all of the Shares,
with no limitations, qualifications or restrictions on such rights.
(b) POWER; BINDING AGREEMENT. Stockholder has the legal
capacity, power and authority to enter into and perform all of its obligations
under this Agreement. The execution, delivery and performance of this Agreement
by Stockholder shall not violate any agreement or any court order to which
Stockholder is a party or is subject including any voting agreement or voting
trust. This Agreement has been duly and validly executed and delivered by
Stockholder.
(c) RESTRICTION ON TRANSFER, PROXIES AND NON-INTERFERENCE.
Except as expressly contemplated by this Agreement, Stockholder will not,
directly or indirectly: (i) offer for sale, sell, transfer, tender, pledge,
encumber, assign or otherwise dispose of, or enter into any contract, option or
other arrangement or understanding with respect to or consent to the offer for
sale, sale, transfer, tender, pledge, encumbrance, assignment or other
disposition of, any or all of the Shares or any interest therein; (ii) grant any
proxies or powers of attorney or deposit any Shares into a voting trust or enter
into a voting agreement with respect to any Shares; or (iii) take any action
that would make any representation or warranty of Stockholder contained herein
untrue or incorrect or have the effect of preventing or disabling Stockholder
from performing any of Stockholder's obligations under this Agreement.
(d) OTHER POTENTIAL ACQUIRORS. Stockholder (i) will
immediately cease any existing discussions or negotiations, if any, with any
persons conducted heretofore with respect to any acquisition of all or any
material portion of the assets of, or any equity interest in, the Company or any
of its subsidiaries, or any business combination with the Company or its
subsidiaries, in his, her or its capacity as such; (ii) from and after the date
hereof until the earlier of the termination of the Merger Agreement in
accordance with its terms and the Effective Time, will not, in such capacity,
directly or indirectly, initiate, solicit or knowingly encourage (including by
way of furnishing non-public information or assistance), or take any other
action to facilitate knowingly, any inquiries or the making of any Third Party
Acquisition; and (iii) shall promptly notify Parent of any proposals for, or
inquiries with respect to, a potential Third Party Acquisition received by
Stockholder or of which Stockholder otherwise has knowledge.
(e) RELIANCE BY PARENT AND ACQUISITION. Stockholder
understands and acknowledges that Parent and Acquisition are entering into the
Merger Agreement in reliance upon Stockholder's execution and delivery of this
Agreement.
6. STOP TRANSFER. Stockholder agrees with, and covenants to, Parent and
Acquisition that Stockholder will not request that the Company register the
transfer (book-entry or otherwise) of any certificate or uncertificated interest
representing any Shares, unless such transfer is made pursuant to this
Agreement. In the event of a stock dividend or distribution, or any change in
the Company Common Stock by reason of any stock dividend, split-up,
recapitalization, combination, exchange of shares or the like, the term "Shares"
shall be deemed to refer to and
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<PAGE>
include the Shares as well as all such stock dividends and distributions and any
shares into which or for which any or all of the Shares may be changed or
exchanged.
7. TERMINATION. This Agreement (except as set forth in Section 3) shall
terminate upon the earliest to occur of: (a) the termination of the Merger
Agreement in accordance with its terms; (b) the Acceptance Date; and (c) July
31, 2000. No such termination of this Agreement shall relieve any party hereto
from any liability for any breach of this Agreement prior to termination.
8. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof.
(b) CERTAIN EVENTS. Stockholder agrees that this Agreement and
the obligations hereunder shall attach to the Shares and shall be binding upon
any person to which legal or beneficial ownership of any Shares shall pass,
whether by operation of law or otherwise. Notwithstanding any transfer of
Shares, the transferor shall remain liable for the performance of all
obligations under this Agreement of the transferor.
(c) ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by operation of law or
otherwise without the prior written consent of the other party; PROVIDED,
HOWEVER, that Parent may, in its sole discretion, assign its rights and
obligations hereunder to any direct wholly-owned subsidiary of Parent.
(d) AMENDMENTS, WAIVERS, ETC. This Agreement may not be
amended, changed, supplemented, waived or otherwise modified or terminated,
except upon the execution and delivery of a written agreement executed by the
parties hereto.
(e) NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if so given) by hand delivery, telecopy, or by
mail (registered or certified mail, postage prepaid, return receipt requested)
or by any nationally-recognized overnight courier service, such as Federal
Express, providing proof of delivery. Any such notice or communication shall be
deemed to have been delivered and received (i) in the case of hand delivery, on
the date of such delivery, (ii) in the case of telecopy, on the date sent if
confirmation of receipt is received and such notice is also promptly mailed by
registered or certified mail (return receipt requested), (iii) in the case of a
nationally-recognized overnight courier service, in circumstances under which
such courier guarantees next business day delivery, on the next business day
after the date when sent, and (iv) the case of mailing on the third business day
following that on which the piece of mail containing such communication is
posted. All communications hereunder shall be delivered to the respective
parties at the following addresses:
8
<PAGE>
<TABLE>
<S> <C>
If to Stockholder: at the address set forth on Schedule A attached hereto
with copies to: Mark VII, Inc.
965 Ridge Lake Boulevard, Suite 100
Memphis, Tennessee 38120
Telecopier: (901) 767-1929
Attention: General Counsel
and
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10019
Telephone: (212) 259-6720
Facsimile: (212) 259-6333
Attention: Robert M. Smith
If to Parent or Acquisition: c/o Ocean Group plc
Ocean House
The Ring
Bracknell
Berkshire RG12 1AW
England
Telecopier: 011 44 134 44 452222
Attention: Group Commercial Director
with a copy to: Gibson, Dunn & Crutcher LLP
200 Park Avenue
New York, New York 10166
Telephone: (212) 351-4000
Telecopier: (212) 351-4035
Attention: Steven R. Finley
</TABLE>
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the matter set forth above.
(f) SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law but if any provision of this Agreement becomes or is declared by
a court of competent jurisdiction to be invalid, illegal or unenforceable in any
respect under any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other provision or portion
of any provision in such jurisdiction, and this Agreement shall be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion
9
<PAGE>
of any provision had never been contained herein.
(g) SPECIFIC PERFORMANCE. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants or agreements
contained in this Agreement shall cause the other party to sustain damage for
which it would not have an adequate remedy at law for money damages, and
therefore each of the parties hereto agrees that in the event of any such breach
the aggrieved party shall be entitled to the remedy of specific performance of
such covenants and agreements and injunctive and other equitable relief in
addition to any other remedy to which it may be entitled, at law or in equity.
(h) NO WAIVER. The failure of any party hereto to exercise any
right, power or remedy provided under this Agreement or otherwise available in
respect hereof at law or in equity, or to insist upon compliance by any other
party hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by such
party of its right to exercise any such or other right, power or remedy or to
demand such compliance.
(i) GOVERNING LAW. This Agreement shall be governed and
construed in accordance with the laws of the State of Delaware, without giving
effect to the principles of conflicts of law thereof.
(j) COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original, but all of
which, taken together, shall constitute one and the same Agreement and shall
become effective when one or more of the counterparts have been signed by each
of the parties and delivered to the other parties.
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<PAGE>
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
duly executed as of the day and year first above written.
MSAS GLOBAL LOGISTICS INC.,
a New York corporation
By: /S/ MICK P. FOUNTAIN
---------------------------------
Name: Mick P. Fountain
Title: Regional Chief Executive
MSAS ACQUISITION CORPORATION,
a Delaware corporation
By: /S/ STUART A. YOUNG
---------------------------------
Name: Stuart A. Young
Title: Secretary
STOCKHOLDER:
By: /S/ THOMAS J. FITZGERALD
---------------------------------
Name: Thomas J. Fitzgerald
[SIGNATURE PAGE TO MSAS/MARK VII STOCKHOLDER TENDER AND
VOTING AND IRREVOCABLE PROXY]
11
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Exhibit (c)(7)
Execution Copy
TENDER AND VOTING AGREEMENT
AND
IRREVOCABLE PROXY
THIS TENDER AND VOTING AGREEMENT AND IRREVOCABLE PROXY, dated as of
July 27, 1999 (this "Agreement"), is entered into by and between MSAS Global
Logistics Inc., a New York corporation ("Parent"), and MSAS Acquisition
Corporation, a Delaware corporation and wholly-owned subsidiary of Parent
("Acquisition"), on the one hand, and Jay U. Sterling ("Stockholder"), on the
other hand.
RECITALS
A. Concurrently herewith, Parent, Acquisition and Mark VII, Inc., a
Delaware corporation (the "Company"), have entered into an Agreement and Plan of
Merger, of even date herewith (as such agreement may hereafter be amended from
time to time, the "Merger Agreement"), pursuant to which Acquisition will make a
tender offer (the "Offer") for all outstanding shares of common stock, $0.05 par
value, of the Company ("Company Common Stock") at an offer price of $23 per
share, net to the seller in cash (such amount, or any greater amount per share
paid pursuant to the Offer, shall be referred to herein as the "Offer Price")
and, after Acquisition has accepted tendered shares for payment (the date on
which such acceptance occurs, the "Acceptance Date"), the Company and
Acquisition will merge with the Company as the surviving corporation and
wholly-owned subsidiary of Parent (the "Merger"). Initially capitalized and
other terms used but not defined herein shall have the meanings ascribed to them
in the Merger Agreement.
B. Stockholder Beneficially Owns (as defined herein) the number of
shares of Company Common Stock set forth opposite Stockholder's name on Schedule
A hereto (such shares, together with shares of Company Common Stock issuable
upon the exercise of options to purchase shares of Company Common Stock
(including the options set forth on Schedule A (the "Options")), being
collectively referred to herein as the "Shares").
C. As an inducement and a condition to entering into the Merger
Agreement, Parent and Acquisition have requested that Stockholder agree, and
Stockholder has agreed, to enter into this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
premises, representations, warranties, covenants and agreements contained
herein, the parties hereto hereby agree as follows:
1. PROVISIONS CONCERNING COMPANY COMMON STOCK.
<PAGE>
(a) Stockholder hereby agrees with Parent and Acquisition that
Stockholder will, promptly after the date of commencement of the Offer (but in
all events not later than five business days thereafter), tender to Acquisition
all outstanding Shares Beneficially Owned by Stockholder on such date (the
"Tendered Shares"). Stockholder further agrees to tender to Acquisition promptly
after Stockholder's acquisition thereof (but in all events not later than five
business days thereafter) all other shares of Company Common Stock acquired
and/or Beneficially Owned by Stockholder at any time prior to the Acceptance
Date or the date on which the Offer is terminated or expires without Acquisition
having accepted shares for payment. All such subsequently tendered Shares shall
constitute "Tendered Shares" for all purposes of this Agreement. Stockholder
agrees not to withdraw any of the Tendered Shares except following the earliest
of the termination of the Merger Agreement, the termination of the Offer or
expiration of the Offer without Acquisition's having accepted the Tendered
Shares for payment. Stockholder acknowledges and agrees that Acquisition's
obligation to accept for payment and pay for the Tendered Shares is subject to
all the terms and conditions of the Offer.
(b) Stockholder hereby agrees with Parent and Acquisition
that, subject to the receipt of proper notice and in the absence of a
preliminary injunction or other final order by any court or other administrative
or judicial authority barring such action, at any meeting of the Company's
stockholders, however called, or in connection with any written consent of the
Company's stockholders, Stockholder will vote the Shares Beneficially Owned by
Stockholder, whether heretofore owned or hereafter acquired: (i) in favor of
approval of the Merger Agreement and any actions required in furtherance of the
transactions contemplated thereby, including voting such shares in favor of the
election to the Company Board of each person designated by Parent for nomination
thereto pursuant to Section 1.3(a) of the Merger Agreement at any meeting of the
Company's stockholders called for the election of directors; (ii) against any
action or agreement that would result in a breach in any respect of any
covenant, representation or warranty or any other obligation or agreement of the
Company under the Merger Agreement; and (iii) except as otherwise agreed to in
writing in advance by Parent, against (A) any Third Party Acquisition, (B) any
change in a majority of the individuals who, as of the date hereof, constitute
the Board of Directors of the Company (other than as contemplated by Section 1.3
of the Merger Agreement), (C) any extraordinary corporate transaction, such as a
merger, consolidation or other business combination involving the Company or any
of its subsidiaries and any Third Party, (D) a sale, lease, transfer or
disposition of any assets of the Company's or any of its subsidiaries' business
outside the ordinary course of business, or any assets which are material to its
business whether or not in the ordinary course of business, or a reorganization,
recapitalization, dissolution or liquidation of the Company or any of its
subsidiaries, (E) any change in the present capitalization of the Company or any
amendment of the Company's Certificate of Incorporation or bylaws, (F) any other
material change in the Company's corporate structure or affecting its business,
or (G) any other action which is intended, or could reasonably be expected, to
impede, interfere with, delay, postpone or materially adversely affect the
Offer, the Merger or any of the other transactions contemplated by the Merger
Agreement, or any of the transactions contemplated by this Agreement.
Stockholder shall not enter into any agreement or understanding with any person
the effect of which would be inconsistent or violative of the provisions and
agreements contained herein. For purposes of this Agreement, "Beneficially
2
<PAGE>
Own" or "Beneficial Ownership" with respect to any securities shall mean
Stockholder having such ownership, control or power to direct the voting with
respect to, or otherwise enables Stockholder to legally act with respect to,
such securities as contemplated hereby, including pursuant to any agreement,
arrangement or understanding, whether or not in writing. Securities Beneficially
Owned by Stockholder shall include securities Beneficially Owned by all other
persons with whom Stockholder would constitute a "group" as within the meaning
of Section 13(d)(3) of the Exchange Act. Stockholder and Parent acknowledge and
agree that nothing in this Section 1(b) will require or be construed to require
Stockholder to take any action in his capacity as a member of the Company Board.
2. IRREVOCABLE PROXY.
(a) Stockholder hereby constitutes and appoints Acquisition,
which shall act by and through Ian Smith and Stuart Young (each, a "Proxy
Holder"), or either of them, with full power of substitution, its true and
lawful proxy and attorney-in-fact to vote at any meeting (and any adjournment or
postponement thereof) of the Company's stockholders called for purposes of
considering whether to approve the Merger Agreement, the Merger or any of the
other transactions contemplated by the Merger Agreement, or any Third Party
Acquisition, or to execute a written consent of stockholders in lieu of any such
meeting, all outstanding Shares Beneficially Owned by Stockholder as of the date
of such meeting or written consent in favor of the approval of the Merger
Agreement, the Merger and the other transactions contemplated by the Merger
Agreement, with such modifications to the Merger Agreement as the parties
thereto may make, or against a Third Party Acquisition, as the case may be. Such
proxy will be limited strictly to the power to vote the Shares in the manner set
forth in the preceding sentence and shall not extend to any other matters.
Without limiting the foregoing, in any such vote or other action pursuant to
such proxy, the Proxy Holders shall not have the right (and such proxy shall not
confer the right) to vote to reduce the Offer Price or otherwise modify or amend
the Merger Agreement to reduce the rights or benefits of the Company or any
stockholders of the Company (including Stockholder) under the Offer or the
Merger Agreement or to reduce the rights or obligations of Parent or Acquisition
thereunder.
(b) The proxy and power of attorney granted herein shall be
irrevocable during the term of this Agreement, shall be deemed to be coupled
with an interest sufficient in law to support an irrevocable proxy and shall
revoke all prior proxies granted by Stockholder. Stockholder will not grant any
proxy to any person which conflicts with the proxy granted herein, and any
attempt to do so will be void. The power of attorney granted herein is a durable
power of attorney and will survive the death or incapacity of Stockholder.
(c) If Stockholder fails for any reason to vote his, hers or
its Shares in accordance with the requirements of Section 1(b) hereof, then the
Proxy Holder shall have the right to vote the Shares at any meeting of the
Company's stockholders and in any action by written consent of the Company's
stockholders in accordance with the provisions of this Section 2. The vote of
the Proxy Holder will control in any conflict between his vote of such Shares
and a vote by Stockholder of such Shares.
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3. PURCHASE OPTION.
(a) Stockholder grants to Parent and Acquisition an
irrevocable option (the "Purchase Option") to purchase for cash, in the manner
set forth below, any or all of the Shares (and any shares of Company Common
Stock acquired by Stockholder after the date hereof) at a price (the "Exercise
Price") per share equal to the Offer Price. In the event of any stock dividends,
stock splits, recapitalizations, combinations, exchanges or shares or similar
transactions, the Offer Price shall be appropriately adjusted.
(b) (1) Subject to the conditions set forth in Section 3(d),
the Purchase Option may be exercised by Parent or Acquisition, in whole or in
part, at any time or from time to time after the occurrence of any Trigger Event
(as defined below). The Company and Stockholder shall notify Parent promptly in
writing of the occurrence of any Trigger Event. The giving of such notice by the
Company or Stockholder is not a condition to the right of Parent or Acquisition
to exercise the Purchase Option. In the event Parent or Acquisition wishes to
exercise the Purchase Option, Parent shall deliver to Stockholder a written
notice (an "Exercise Notice") specifying the total number of Shares it wishes to
purchase from Stockholder. Each closing of a purchase of Shares (a "Closing")
will occur at a place, on a date and at a time designated by Parent or
Acquisition in an Exercise Notice delivered at least two business days prior to
the date of the Closing.
(2) A "Trigger Event" means any one of the following:
(i) the Merger Agreement becomes terminable under circumstances that entitle
Parent or Acquisition to receive the liquidated damages under Section 7.3(a) of
the Merger Agreement or fees and expenses under Section 7.3(b) of the Merger
Agreement (regardless of whether the Merger Agreement is actually terminated and
whether such liquidated damages or fees and expenses are then actually paid);
(ii) the Offer is consummated but, due to the failure of Stockholder to validly
tender and not withdraw all of the then outstanding Beneficially Owned Shares,
Acquisition has not accepted for payment or paid for all of such shares of
Company Common Stock; (iii) a tender or exchange offer for at least 10% of the
shares of Company Common Stock shall have been publicly proposed to be made or
shall have been made by another person; or (iv) it shall have been publicly
disclosed or Parent or Acquisition shall have otherwise learned that (A) any
person or "group" (as defined in Section 13(d)(3) of the Exchange Act) (other
than Parent or Acquisition) shall have acquired or proposed to acquire
beneficial ownership of more than 10% of any class or series of capital stock of
the Company (including the Company Common Stock), through the acquisition of
stock, the formation of a group or otherwise, or shall have been granted any
option, right or warrant, conditional or otherwise, to acquire beneficial
ownership of more than 10% of any class or series of capital stock of the
Company or any of its subsidiaries, or (B) any person or group (other than
Parent and Acquisition) shall have entered into or publicly offered to enter
into a definitive agreement or an agreement in principle with respect to a
merger, consolidation or other business combination with the Company or any of
its subsidiaries.
(3) If requested by Parent and Acquisition in the
Exercise Notice, Stockholder shall exercise all Options (to the extent
exercisable) and other rights (including
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conversion or exchange rights) Beneficially Owned by Stockholder and shall sell
or, if directed by Parent and Acquisition, tender the Shares acquired pursuant
to such exercise to Parent or Acquisition as provided in this Agreement.
(c) TERMINATION OF PURCHASE OPTION. The Purchase Option will terminate
upon the earliest of: (i) the Acceptance Date; (ii) termination of the Merger
Agreement other than upon, during the continuance of or after a Trigger Event;
or (iii) 90 days following any termination of the Merger Agreement upon, during
the continuance of or after a Trigger Event (or if, at the expiration of such 90
day period the Purchase Option cannot be exercised by reason of any applicable
judgment, decree, order, injunction, law or regulation, ten business days after
such impediment to exercise has been removed or has become final and not subject
to appeal). Upon the giving by Parent or Acquisition to Stockholder of the
Exercise Notice and the tender of the aggregate Exercise Price, Parent or
Acquisition, as the case may be, will be deemed to be the holder of record of
the Shares transferable upon such exercise, notwithstanding that the stock
transfer books of the Company are then closed or that certificates representing
such Shares have not been actually delivered to Parent.
(d) CONDITIONS TO CLOSING. The obligation of Stockholder to sell
Stockholder's Shares to Parent or Acquisition hereunder is subject to the
conditions that: (i) all waiting periods, if any, under the HSR Act, applicable
to the sale of the Shares or the acquisition of the Shares by Parent or
Acquisition, as the case may be, hereunder have expired or have been terminated;
(ii) all consents, approvals, orders or authorizations of, or registrations,
declarations or filings with, any court, administrative agency or other
Governmental Entity, if any, required in connection with sale of the Shares or
the acquisition of the Shares by Parent or Acquisition hereunder have been
obtained or made; and (iii) no preliminary or permanent injunction or other
order by any court of competent jurisdiction prohibiting or otherwise
restraining such sale or acquisition is in effect.
(e) CLOSING. At any Closing with respect to Shares Beneficially Owned
by Stockholder, (i) Stockholder will deliver to Parent, Acquisition or their
respective designee a certificate or certificates in definitive form
representing the number of the Shares designated by Parent or Acquisition, as
the case may be, in its Exercise Notice, such certificate to be registered in
the name of Parent, Acquisition or their respective designee and (ii) Parent or
Acquisition, as the case may be, will deliver to Stockholder the aggregate
Exercise Price for the Shares so designated and being purchased by wire transfer
of immediately available funds.
(f) REGISTRATION RIGHTS. (1) Following termination of the Merger
Agreement, Parent or Acquisition may in its sole discretion (but shall not be
required) by written notice (the "Registration Notice") to the Company request
the Company to register under the Securities Act all or any part of the shares
of Company Common Stock acquired under the Purchase Option (the "Registrable
Securities").
(2) The Company shall use commercially reasonable
efforts to effect, as promptly as practicable, the registration under the
Securities Act of the Registrable Securities; PROVIDED, HOWEVER, that (i) Parent
and Acquisition will be entitled to no more than one effective
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registration statement hereunder and (ii) the Company will not be required to
file any such registration statement during any period of time (not to exceed 40
days after such request in the case of clause (A) below or 90 days in the case
of clauses (B) and (C) below) when (A) the Company is in possession of material
non-public information that it reasonably believes would be detrimental to be
disclosed at such time and that such information would have to be disclosed if a
registration statement were filed at that time, (B) the Company is required
under the Securities Act to include audited financial statements for any period
in such registration statement and such financial statements are not yet
available for inclusion in such registration statement or (C) the Company
determines, in its reasonable judgment, that such registration would interfere
with any proposed financing, acquisition or other material transaction involving
the Company or any of its affiliates. The Company shall use its reasonable best
efforts to cause any Registrable Securities registered pursuant to this Section
3(f) to be qualified for sale under the securities or blue-sky laws of such
jurisdictions as Parent or Acquisition may reasonably request and shall continue
such registration or qualification in effect in such jurisdiction.
(3) The registration rights set forth in this Section
3(f) are subject to the condition that Parent and Acquisition shall provide the
Company with such information with respect to their Registrable Securities, the
plans for the distribution thereof, and such other information with respect to
such holder as, in the reasonable judgment of counsel for the Company, is
necessary to enable the Company to include in such registration statement all
material facts required to be disclosed with respect to a registration
thereunder.
(4) A registration effected under this Section 3(f)
will be effected at the Company's expense, except for underwriting discounts and
commissions and the fees and the expenses of counsel to Parent and Acquisition
(which will be paid by Parent and Acquisition, and the Company shall provide to
the underwriters (in connection with an underwritten offering) such
documentation (including certificates, opinions of counsel and "comfort" letters
from auditors) as are customary in connection with underwritten offerings as
such underwriters may reasonably require. In connection with any such
registration, the parties agree (i) to indemnify each other and the underwriters
in the customary manner, (ii) to enter into an underwriting agreement in form
and substance customary for transactions of such type with the underwriters
participating in such offering and (iii) to take all further actions that will
be reasonably necessary to effect such registration and sale (including, if the
underwriters deem it necessary, participating in road-show presentations).
4. DIRECTOR MATTERS EXCLUDED. Parent and Acquisition acknowledge and
agree that no provision of this Agreement shall limit or otherwise restrict
Stockholder with respect to any act or omission that Stockholder may undertake
or authorize in his capacity as a director of the Company, including any vote
that Stockholder may make as a director of the Company with respect to any
matter presented to the Board of Directors of the Company.
5. OTHER COVENANTS, REPRESENTATIONS AND WARRANTIES. Stockholder hereby
represents and warrants to Parent and Acquisition as follows:
(a) OWNERSHIP OF SHARES. Stockholder is the Beneficial Owner
of all the
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Shares. On the date hereof, the Shares constitute all of the Shares Beneficially
Owned by Stockholder. Stockholder has voting power with respect to the matters
set forth in Section 1(b) hereof with respect to all of the Shares, with no
limitations, qualifications or restrictions on such rights.
(b) POWER; BINDING AGREEMENT. Stockholder has the legal
capacity, power and authority to enter into and perform all of its obligations
under this Agreement. The execution, delivery and performance of this Agreement
by Stockholder shall not violate any agreement or any court order to which
Stockholder is a party or is subject including any voting agreement or voting
trust. This Agreement has been duly and validly executed and delivered by
Stockholder.
(c) RESTRICTION ON TRANSFER, PROXIES AND NON-INTERFERENCE.
Except as expressly contemplated by this Agreement, Stockholder will not,
directly or indirectly: (i) offer for sale, sell, transfer, tender, pledge,
encumber, assign or otherwise dispose of, or enter into any contract, option or
other arrangement or understanding with respect to or consent to the offer for
sale, sale, transfer, tender, pledge, encumbrance, assignment or other
disposition of, any or all of the Shares or any interest therein; (ii) grant any
proxies or powers of attorney or deposit any Shares into a voting trust or enter
into a voting agreement with respect to any Shares; or (iii) take any action
that would make any representation or warranty of Stockholder contained herein
untrue or incorrect or have the effect of preventing or disabling Stockholder
from performing any of Stockholder's obligations under this Agreement.
(d) OTHER POTENTIAL ACQUIRORS. Stockholder (i) will
immediately cease any existing discussions or negotiations, if any, with any
persons conducted heretofore with respect to any acquisition of all or any
material portion of the assets of, or any equity interest in, the Company or any
of its subsidiaries, or any business combination with the Company or its
subsidiaries, in his, her or its capacity as such; (ii) from and after the date
hereof until the earlier of the termination of the Merger Agreement in
accordance with its terms and the Effective Time, will not, in such capacity,
directly or indirectly, initiate, solicit or knowingly encourage (including by
way of furnishing non-public information or assistance), or take any other
action to facilitate knowingly, any inquiries or the making of any Third Party
Acquisition; and (iii) shall promptly notify Parent of any proposals for, or
inquiries with respect to, a potential Third Party Acquisition received by
Stockholder or of which Stockholder otherwise has knowledge.
(e) RELIANCE BY PARENT AND ACQUISITION. Stockholder
understands and acknowledges that Parent and Acquisition are entering into the
Merger Agreement in reliance upon Stockholder's execution and delivery of this
Agreement.
6. STOP TRANSFER. Stockholder agrees with, and covenants to, Parent and
Acquisition that Stockholder will not request that the Company register the
transfer (book-entry or otherwise) of any certificate or uncertificated interest
representing any Shares, unless such transfer is made pursuant to this
Agreement. In the event of a stock dividend or distribution, or any change in
the Company Common Stock by reason of any stock dividend, split-up,
recapitalization, combination, exchange of shares or the like, the term "Shares"
shall be deemed to refer to and
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include the Shares as well as all such stock dividends and distributions and any
shares into which or for which any or all of the Shares may be changed or
exchanged.
7. TERMINATION. This Agreement (except as set forth in Section 3) shall
terminate upon the earliest to occur of: (a) the termination of the Merger
Agreement in accordance with its terms; (b) the Acceptance Date; and (c) July
31, 2000. No such termination of this Agreement shall relieve any party hereto
from any liability for any breach of this Agreement prior to termination.
8. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof.
(b) CERTAIN EVENTS. Stockholder agrees that this Agreement and
the obligations hereunder shall attach to the Shares and shall be binding upon
any person to which legal or beneficial ownership of any Shares shall pass,
whether by operation of law or otherwise. Notwithstanding any transfer of
Shares, the transferor shall remain liable for the performance of all
obligations under this Agreement of the transferor.
(c) ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by operation of law or
otherwise without the prior written consent of the other party; PROVIDED,
HOWEVER, that Parent may, in its sole discretion, assign its rights and
obligations hereunder to any direct wholly-owned subsidiary of Parent.
(d) AMENDMENTS, WAIVERS, ETC. This Agreement may not be
amended, changed, supplemented, waived or otherwise modified or terminated,
except upon the execution and delivery of a written agreement executed by the
parties hereto.
(e) NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be in writing and shall be given (and shall be
deemed to have been duly received if so given) by hand delivery, telecopy, or by
mail (registered or certified mail, postage prepaid, return receipt requested)
or by any nationally-recognized overnight courier service, such as Federal
Express, providing proof of delivery. Any such notice or communication shall be
deemed to have been delivered and received (i) in the case of hand delivery, on
the date of such delivery, (ii) in the case of telecopy, on the date sent if
confirmation of receipt is received and such notice is also promptly mailed by
registered or certified mail (return receipt requested), (iii) in the case of a
nationally-recognized overnight courier service, in circumstances under which
such courier guarantees next business day delivery, on the next business day
after the date when sent, and (iv) the case of mailing on the third business day
following that on which the piece of mail containing such communication is
posted. All communications hereunder shall be delivered to the respective
parties at the following addresses:
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If to Stockholder: at the address set forth on Schedule A attached
hereto
with copies to: Mark VII, Inc.
965 Ridge Lake Boulevard, Suite 100
Memphis, Tennessee 38120
Telecopier: (901) 767-1929
Attention: General Counsel
and
Dewey Ballantine LLP
1301 Avenue of the Americas
New York, New York 10019
Telephone: (212) 259-6720
Facsimile: (212) 259-6333
Attention: Robert M. Smith
If to Parent or Acquisition: c/o Ocean Group plc
Ocean House
The Ring
Bracknell
Berkshire RG12 1AW
England
Telecopier: 011 44 134 44 452222
Attention: Group Commercial Director
with a copy to: Gibson, Dunn & Crutcher LLP
200 Park Avenue
New York, New York 10166
Telephone: (212) 351-4000
Telecopier: (212) 351-4035
Attention: Steven R. Finley
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the matter set forth above.
(f) SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law but if any provision of this Agreement becomes or is declared by
a court of competent jurisdiction to be invalid, illegal or unenforceable in any
respect under any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other provision or portion
of any provision in such jurisdiction, and this Agreement shall be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion
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of any provision had never been contained herein.
(g) SPECIFIC PERFORMANCE. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants or agreements
contained in this Agreement shall cause the other party to sustain damage for
which it would not have an adequate remedy at law for money damages, and
therefore each of the parties hereto agrees that in the event of any such breach
the aggrieved party shall be entitled to the remedy of specific performance of
such covenants and agreements and injunctive and other equitable relief in
addition to any other remedy to which it may be entitled, at law or in equity.
(h) NO WAIVER. The failure of any party hereto to exercise any
right, power or remedy provided under this Agreement or otherwise available in
respect hereof at law or in equity, or to insist upon compliance by any other
party hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by such
party of its right to exercise any such or other right, power or remedy or to
demand such compliance.
(i) GOVERNING LAW. This Agreement shall be governed and
construed in accordance with the laws of the State of Delaware, without giving
effect to the principles of conflicts of law thereof.
(j) COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original, but all of
which, taken together, shall constitute one and the same Agreement and shall
become effective when one or more of the counterparts have been signed by each
of the parties and delivered to the other parties.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
duly executed as of the day and year first above written.
MSAS GLOBAL LOGISTICS INC.,
a New York corporation
By: /s/ MICK P. FOUNTAIN
-------------------------------
Name: Mick P. Fountain
Title: Regional Chief Executive
MSAS ACQUISITION CORPORATION,
a Delaware corporation
By: /s/ Stuart A. Young
-------------------------------
Name: Stuart A. Young
Title: Secretary
STOCKHOLDER:
By: /s/ Jay U. Sterling
----------------------------
Name: Jay U. Sterling
[SIGNATURE PAGE TO MSAS/MARK VII STOCKHOLDER TENDER AND
VOTING AND IRREVOCABLE PROXY]
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Exhibit (c)(8)
Execution Copy
STOCK PURCHASE AND STOCKHOLDER AGREEMENT
THIS STOCK PURCHASE AND STOCKHOLDER AGREEMENT, dated as of July 27,
1999 (this "Agreement"), is entered into by and between Ocean Group plc, a
company organized under the laws of England and Wales ("Ocean Group"), on the
one hand, and R.C. Matney ("Stockholder"), on the other hand.
RECITALS
A. Concurrently herewith, MSAS Global Logistics Inc., a New York
corporation ("Parent"), MSAS Acquisition Corporation, a Delaware corporation and
wholly-owned subsidiary of Parent ("Acquisition"), and Mark VII, Inc., a
Delaware corporation (the "Company"), have entered into an Agreement and Plan of
Merger, of even date herewith (as such agreement may hereafter be amended from
time to time, the "Merger Agreement"), pursuant to which Acquisition will make a
tender offer (the "Offer") for all outstanding shares of common stock, $0.05 par
value, of the Company ("Company Common Stock") at an offer price of $23 per
share, net to the seller in cash and, after Acquisition has accepted tendered
shares for payment (the date on which such acceptance occurs, the "Acceptance
Date"), the Company and Acquisition will merge with the Company as the surviving
corporation and wholly-owned subsidiary of Parent (the "Merger"). The date of
consummation of the Merger will be referred to herein as the "Closing Date."
B. Concurrently herewith, Stockholder has entered into a Tender and
Voting Agreement and Irrevocable Proxy (the "Voting Agreement") with Parent and
Acquisition.
C. In connection with the Voting Agreement and the terms of the Merger
Agreement, Stockholder (following the Acceptance Date or the Closing Date, as
applicable) will receive cash in exchange for (1) the tender/sale of all of the
shares of Company Common Stock beneficially owned by Stockholder (the "Old
Shares"), (2) the cancellation of all of Stockholder's outstanding options to
purchase shares of Company Common Stock (the "Options") and (3) the cancellation
of all of Stockholder's outstanding stock appreciation rights relating to shares
of Company Common Stock ("SARs"). The proceeds to be received by Stockholder,
net of any federal, state of local taxes payable with respect to such proceeds,
relating to the tender, sale or cancellation, as the case may be, of the Old
Shares, Options and SARs shall be referred to herein as the "Proceeds."
D. As an inducement and a condition to entering into the Merger
Agreement, Parent and Acquisition have requested that Stockholder agree, and
Stockholder has agreed, to enter into this Agreement.
<PAGE>
NOW, THEREFORE, in consideration of the foregoing and the mutual
premises, representations, warranties, covenants and agreements contained
herein, the parties hereto hereby agree as follows:
1. PURCHASE OF SHARES.
Immediately following consummation of the Merger, Stockholder
shall purchase from Ocean Group and Ocean Group shall sell to Stockholder the
number of ordinary shares of Ocean Group ("Ocean Group Shares") equal to the
quotient, rounded down to the nearest whole number, of (x) 0.10 multiplied by
the Proceeds and (y) the average closing price of an Ocean Group Share on the
London Stock Exchange for the last five trading days ending two days prior to
the Closing Date (such price to be referred to as the "Stock Price" and such
shares to be referred to herein as "Purchased Shares"). The total purchase price
for the Purchased Shares shall equal the Share Price multiplied by the number of
Purchased Shares and shall be promptly paid by Stockholder by check, banker's
draft or wire transfer to such account as Ocean Group may designate. Following
confirmation that Ocean Group has received cash funds representing the aggregate
purchase price for the Purchased Shares, a certificate or certificates
representing such shares registered in the name of Stockholder will be delivered
by Ocean Group to Stockholder. The parties to this Agreement agree to cooperate
to create and attach hereto as Schedule A, as soon as practicable following the
date hereof, a calculation of the Proceeds.
2. RESTRICTIONS ON TRANSFERS OF THE SHARES; LEGEND.
(a) Except as provided in Section 2(b) hereof, during the
period beginning on the Closing Date of the Merger and ending on the fourth
anniversary of the Closing Date (such period, the "Restricted Period"),
Stockholder shall not sell, assign, pledge, hypothecate or otherwise encumber or
dispose of any Purchased Shares, whether directly or indirectly, whether
voluntary or involuntary and whether for consideration or without consideration
(each, a "Transfer"), other than pursuant to a Family Transfer. For purposes of
this Agreement, "Family Transfer" means a transfer by gift or testamentary
disposition to one or more members of Stockholder's Immediate Family, to a trust
solely for the benefit of the Stockholder and/or his or her Immediate Family or
to a partnership or limited liability company the partners or shareholders of
which are limited to the Stockholder and his or her Immediate Family (provided
all such transferees remain subject to this Agreement) and "Immediate Family"
means Stockholder's spouse, children or grandchildren (including adopted and
stepchildren and grandchildren).
(b) During the Restricted Period, Stockholder may Transfer the
Purchased Shares in accordance with the following schedule:
(i) if the Company meets or exceeds the fiscal
year 1999 performance targets, as set forth
on Schedule B attached hereto, Stockholder
may Transfer up to 25% of the Purchased
Shares following the date the board of
directors of the Company determines whether
such targets have been met or exceeded;
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<PAGE>
(ii) if the Company meets or exceeds the fiscal
year 2000 performance targets, as set forth
on Schedule B attached hereto, Stockholder
may Transfer up to an additional 25% of the
Purchased Shares following the date the
board of directors of the Company determines
whether such targets have been met or
exceeded;
(iii) if the Company meets or exceeds the fiscal
year 2001 performance targets, as set forth
on Schedule B attached hereto, Stockholder
may Transfer up to an additional 25% of the
Purchased Shares following the date the
board of directors of the Company determines
whether such targets have been met or
exceeded; and
(iv) if the Company meets or exceeds the fiscal
year 2002 performance targets, as set forth
on Schedule B attached hereto, Stockholder
may Transfer up to an additional 25% of the
Purchased Shares following the date the
board of directors of the Company determines
whether such targets have been met or
exceeded.
If, for any fiscal year set forth in Schedule B, the Company's
cumulative results for that and the preceding fiscal years covered by this
Agreement (as specified in Schedule B) equals or exceeds the cumulative
performance target amounts set forth in Schedule B with respect to such fiscal
year, Stockholder may Transfer a number of Purchased Shares equal to the number
of Purchased Shares Stockholder would have been permitted to Transfer had the
Company achieved its performance targets for that and each of the preceding
fiscal years covered by this Agreement. Ocean Group will use its best efforts to
cause the board of directors of the Company to determine whether the performance
targets have been met or exceeded as soon as commercially reasonable following
the end of each fiscal year covered by this Agreement. The parties to this
Agreement agree to cooperate to create and attach hereto Schedule B, as soon as
practicable following the date hereof.
(c) All certificates representing the Purchased Shares shall,
in addition to other legends that may be required by applicable law, bear the
following legend, unless otherwise determined by counsel to Ocean Group:
"THE SALE AND TRANSFERABILITY OF THESE SECURITIES ARE SUBJECT
TO RESTRICTIONS AS SET FORTH IN A STOCK PURCHASE AND STOCKHOLDERS
AGREEMENT BETWEEN THE ORIGINAL PURCHASER OF THE SHARES REPRESENTED BY
THIS CERTIFICATE AND THE CORPORATION (THE "SHAREHOLDERS AGREEMENT").
ANY ATTEMPTED SALE OR TRANSFER OF THESE SECURITIES WHICH DOES NOT
COMPLY APPLICABLE PROVISIONS OF THE SHAREHOLDERS AGREEMENT SHALL BE
VOID.
3. REPRESENTATIONS AND ACKNOWLEDGMENTS OF STOCKHOLDER.
(a) Stockholder hereby represents and warrants to Ocean Group
as follows:
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(i) The Purchased Shares will be acquired for
investment for Stockholder's own account, not as a nominee or
agent, and not with a view to the resale or distribution of
any part thereof. Stockholder has no present intention of
selling, granting any participation in, or otherwise
distributing the same. Stockholder does not have any contract,
undertaking, agreement or arrangement with any person to sell,
Transfer or grant participation to such person or any third
person with respect to any of the Purchased Shares.
(ii) Stockholder has received all the information he
considers necessary or appropriate for deciding whether to
acquire the Purchased Shares. Stockholder has had an
opportunity to ask questions and receive answers from Ocean
Group regarding Ocean Group and the terms and conditions of
this Agreement.
(iii) Stockholder is able to bear the economic risk
of this investment and is capable of evaluating the merits and
risks of this investment. Stockholder understands that
Stockholder's interest in Ocean Group may be subject to
dilution based on additional share issuances.
(iv) Stockholder has full power and authority to
enter into this Agreement and to perform his or her
obligations hereunder and to consummate the transactions
contemplated herein. This Agreement is a valid and binding
agreement of Stockholder, enforceable against him or her in
accordance with its terms.
(b) Stockholder hereby acknowledges that the Purchased Shares
are being issued to Stockholder without registration or other qualification
under any applicable securities law, and that Stockholder cannot Transfer any
Shares except in full compliance with all applicable laws, including securities
laws and as otherwise limited hereby.
4. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof.
(b) CERTAIN EVENTS. Stockholder agrees that this Agreement and
the obligations hereunder shall attach to the Purchased Shares and shall be
binding upon any person to which legal or beneficial ownership of the Purchased
Shares shall pass, whether by operation of law or otherwise. Notwithstanding any
transfer of Purchased Shares, the transferor shall remain liable for the
performance of all obligations under this Agreement of the transferor.
(c) ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by operation of law or
otherwise without the prior written consent of the other party.
4
<PAGE>
(d) AMENDMENTS, WAIVERS, ETC. This Agreement may not be
amended, changed, supplemented, waived or otherwise modified or terminated,
except upon the execution and delivery of a written agreement executed by the
parties hereto.
(e) NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be made in accordance with the notice provisions
set forth in the Voting Agreement.
(f) SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law but if any provision of this Agreement becomes or is declared by
a court of competent jurisdiction to be invalid, illegal or unenforceable in any
respect under any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other provision or portion
of any provision in such jurisdiction, and this Agreement shall be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never been contained
herein.
(g) SPECIFIC PERFORMANCE. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants or agreements
contained in this Agreement shall cause the other party to sustain damage for
which it would not have an adequate remedy at law for money damages, and
therefore each of the parties hereto agrees that in the event of any such breach
the aggrieved party shall be entitled to the remedy of specific performance of
such covenants and agreements and injunctive and other equitable relief in
addition to any other remedy to which it may be entitled, at law or in equity.
(h) NO WAIVER. The failure of any party hereto to exercise any
right, power or remedy provided under this Agreement or otherwise available in
respect hereof at law or in equity, or to insist upon compliance by any other
party hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by such
party of its right to exercise any such or other right, power or remedy or to
demand such compliance.
(i) GOVERNING LAW. This Agreement shall be governed and
construed in accordance with the laws of the State of Delaware, without giving
effect to the principles of conflicts of law thereof.
(j) COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original, but all of
which, taken together, shall constitute one and the same Agreement and shall
become effective when one or more of the counterparts have been signed by each
of the parties and delivered to the other parties.
5
<PAGE>
IN WITNESS WHEREOF, Ocean Group and Stockholder have caused this
Agreement to be duly executed as of the day and year first above written.
OCEAN GROUP PLC,
an England and Wales company
By: /s/ John M. Allan
----------------------------
Name: John Allan
Title: Chief Executive
R. C. MATNEY
/s/ R. C. Matney
-------------------------------
[SIGNATURE PAGE FOR OCEAN GROUP/STOCKHOLDER STOCK PURCHASE AND STOCKHOLDER
AGREEMENT]
6
<PAGE>
Exhibit (c)(9)
FORM OF
STOCK PURCHASE AND STOCKHOLDER AGREEMENT
THIS STOCK PURCHASE AND STOCKHOLDER AGREEMENT, dated as of July __,
1999 (this "Agreement"), is entered into by and between Ocean Group plc, a
company organized under the laws of England and Wales ("Ocean Group"), on the
one hand, and David H. Wedaman ("Stockholder"), on the other hand.
RECITALS
A. MSAS Global Logistics Inc., a New York corporation ("Parent"), MSAS
Acquisition Corporation, a Delaware corporation and wholly-owned subsidiary of
Parent ("Acquisition"), and Mark VII, Inc., a Delaware corporation (the
"Company"), have entered into an Agreement and Plan of Merger, dated as of July
27, 1999 (as such agreement may hereafter be amended from time to time, the
"Merger Agreement"), pursuant to which Acquisition will make a tender offer (the
"Offer") for all outstanding shares of common stock, $0.05 par value, of the
Company ("Company Common Stock") at an offer price of $23 per share, net to the
seller in cash and, after Acquisition has accepted tendered shares for payment
(the date on which such acceptance occurs, the "Acceptance Date"), the Company
and Acquisition will merge with the Company as the surviving corporation and
wholly-owned subsidiary of Parent (the "Merger"). The date of consummation of
the Merger will be referred to herein as the "Closing Date."
B. On July 27, 1999, Stockholder entered into a Tender and Voting
Agreement and Irrevocable Proxy (the "Voting Agreement") with Parent and
Acquisition.
C. In connection with the Voting Agreement and the terms of the Merger
Agreement, Stockholder (following the Acceptance Date or the Closing Date, as
applicable) will receive cash in exchange for (1) the tender/sale of all of the
shares of Company Common Stock beneficially owned by Stockholder (the "Old
Shares"), (2) the cancellation of all of Stockholder's outstanding options to
purchase shares of Company Common Stock (the "Options") and (3) the cancellation
of all of Stockholder's outstanding stock appreciation rights relating to shares
of Company Common Stock ("SARs"). The proceeds to be received by Stockholder,
net of any federal, state of local taxes payable with respect to such proceeds,
relating to the tender, sale or cancellation, as the case may be, of the Old
Shares, Options and SARs shall be referred to herein as the "Proceeds."
D. As an inducement and a condition to entering into the Merger
Agreement, Parent and Acquisition have requested that Stockholder agree, and
Stockholder has agreed, to enter into this Agreement.
<PAGE>
NOW, THEREFORE, in consideration of the foregoing and the mutual
premises, representations, warranties, covenants and agreements contained
herein, the parties hereto hereby agree as follows:
1. PURCHASE OF SHARES.
Immediately following consummation of the Merger, Stockholder
shall purchase from Ocean Group and Ocean Group shall sell to Stockholder the
number of ordinary shares of Ocean Group ("Ocean Group Shares") equal to the
quotient, rounded down to the nearest whole number, of (x) 0.10 multiplied by
the Proceeds and (y) the average closing price of an Ocean Group Share on the
London Stock Exchange for the last five trading days ending two days prior to
the Closing Date (such price to be referred to as the "Stock Price" and such
shares to be referred to herein as "Purchased Shares"). The total purchase price
for the Purchased Shares shall equal the Share Price multiplied by the number of
Purchased Shares and shall be promptly paid by Stockholder by check, banker's
draft or wire transfer to such account as Ocean Group may designate. Following
confirmation that Ocean Group has received cash funds representing the aggregate
purchase price for the Purchased Shares, a certificate or certificates
representing such shares registered in the name of Stockholder will be delivered
by Ocean Group to Stockholder. The parties to this Agreement agree to cooperate
to create and attach hereto as Schedule A, as soon as practicable following the
date hereof, a calculation of the Proceeds.
2. RESTRICTIONS ON TRANSFERS OF THE SHARES; LEGEND.
(a) Except as provided in Section 2(b) hereof, during the
period beginning on the Closing Date of the Merger and ending on the fourth
anniversary of the Closing Date (such period, the "Restricted Period"),
Stockholder shall not sell, assign, pledge, hypothecate or otherwise encumber or
dispose of any Purchased Shares, whether directly or indirectly, whether
voluntary or involuntary and whether for consideration or without consideration
(each, a "Transfer"), other than pursuant to a Family Transfer. For purposes of
this Agreement, "Family Transfer" means a transfer by gift or testamentary
disposition to one or more members of Stockholder's Immediate Family, to a trust
solely for the benefit of the Stockholder and/or his or her Immediate Family or
to a partnership or limited liability company the partners or shareholders of
which are limited to the Stockholder and his or her Immediate Family (provided
all such transferees remain subject to this Agreement) and "Immediate Family"
means Stockholder's spouse, children or grandchildren (including adopted and
stepchildren and grandchildren).
(b) During the Restricted Period, Stockholder may Transfer the
Purchased Shares in accordance with the following schedule:
(i) if the Company meets or exceeds the fiscal
year 1999 performance targets, as set forth
on Schedule B attached hereto, Stockholder
may Transfer up to 25% of the Purchased
Shares following the date the board of
directors of the Company determines whether
such targets have been met or exceeded;
2
<PAGE>
(ii) if the Company meets or exceeds the fiscal
year 2000 performance targets, as set forth
on Schedule B attached hereto, Stockholder
may Transfer up to an additional 25% of the
Purchased Shares following the date the
board of directors of the Company determines
whether such targets have been met or
exceeded;
(iii) if the Company meets or exceeds the fiscal
year 2001 performance targets, as set forth
on Schedule B attached hereto, Stockholder
may Transfer up to an additional 25% of the
Purchased Shares following the date the
board of directors of the Company determines
whether such targets have been met or
exceeded; and
(iv) if the Company meets or exceeds the fiscal
year 2002 performance targets, as set forth
on Schedule B attached hereto, Stockholder
may Transfer up to an additional 25% of the
Purchased Shares following the date the
board of directors of the Company determines
whether such targets have been met or
exceeded.
If, for any fiscal year set forth in Schedule B, the Company's
cumulative results for that and the preceding fiscal years covered by this
Agreement (as specified in Schedule B) equals or exceeds the cumulative
performance target amounts set forth in Schedule B with respect to such fiscal
year, Stockholder may Transfer a number of Purchased Shares equal to the number
of Purchased Shares Stockholder would have been permitted to Transfer had the
Company achieved its performance targets for that and each of the preceding
fiscal years covered by this Agreement. Ocean Group will use its best efforts to
cause the board of directors of the Company to determine whether the performance
targets have been met or exceeded as soon as commercially reasonable following
the end of each fiscal year covered by this Agreement. The parties to this
Agreement agree to cooperate to create and attach hereto Schedule B, as soon as
practicable following the date hereof. In addition, if Stockholder's employment
with the Company (or any successor thereto) terminates for any reason, the
Restricted Period and the Transfer restrictions set forth in Section 2(a) hereof
shall immediately terminate and lapse and be of no further force and effect.
(c) All certificates representing the Purchased Shares shall,
in addition to other legends that may be required by applicable law, bear the
following legend, unless otherwise determined by counsel to Ocean Group:
"THE SALE AND TRANSFERABILITY OF THESE SECURITIES ARE SUBJECT
TO RESTRICTIONS AS SET FORTH IN A STOCK PURCHASE AND STOCKHOLDERS
AGREEMENT BETWEEN THE ORIGINAL PURCHASER OF THE SHARES REPRESENTED BY
THIS CERTIFICATE AND THE CORPORATION (THE "SHAREHOLDERS AGREEMENT").
ANY ATTEMPTED SALE OR TRANSFER OF THESE SECURITIES WHICH DOES NOT
COMPLY APPLICABLE PROVISIONS OF THE SHAREHOLDERS AGREEMENT SHALL BE
VOID.
3. REPRESENTATIONS AND ACKNOWLEDGMENTS OF STOCKHOLDER.
3
<PAGE>
(a) Stockholder hereby represents and warrants to Ocean
Group as follows:
(i) The Purchased Shares will be acquired for
investment for Stockholder's own account, not as a nominee or
agent, and not with a view to the resale or distribution of
any part thereof. Stockholder has no present intention of
selling, granting any participation in, or otherwise
distributing the same. Stockholder does not have any contract,
undertaking, agreement or arrangement with any person to sell,
Transfer or grant participation to such person or any third
person with respect to any of the Purchased Shares.
(ii) Stockholder has received all the information he
considers necessary or appropriate for deciding whether to
acquire the Purchased Shares. Stockholder has had an
opportunity to ask questions and receive answers from Ocean
Group regarding Ocean Group and the terms and conditions of
this Agreement.
(iii) Stockholder is able to bear the economic risk
of this investment and is capable of evaluating the merits and
risks of this investment. Stockholder understands that
Stockholder's interest in Ocean Group may be subject to
dilution based on additional share issuances.
(iv) Stockholder has full power and authority to
enter into this Agreement and to perform his or her
obligations hereunder and to consummate the transactions
contemplated herein. This Agreement is a valid and binding
agreement of Stockholder, enforceable against him or her in
accordance with its terms.
(b) Stockholder hereby acknowledges that the Purchased Shares
are being issued to Stockholder without registration or other qualification
under any applicable securities law, and that Stockholder cannot Transfer any
Shares except in full compliance with all applicable laws, including securities
laws and as otherwise limited hereby.
4. MISCELLANEOUS.
(a) ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement between the parties with respect to the subject matter hereof and
supersedes all other prior agreements and understandings, both written and oral,
among the parties with respect to the subject matter hereof.
(b) CERTAIN EVENTS. Stockholder agrees that this Agreement and
the obligations hereunder shall attach to the Purchased Shares and shall be
binding upon any person to which legal or beneficial ownership of the Purchased
Shares shall pass, whether by operation of law or otherwise. Notwithstanding any
transfer of Purchased Shares, the transferor shall remain liable for the
performance of all obligations under this Agreement of the transferor.
4
<PAGE>
(c) ASSIGNMENT. Neither this Agreement nor any of the rights,
interests or obligations hereunder shall be assigned by operation of law or
otherwise without the prior written consent of the other party.
(d) AMENDMENTS, WAIVERS, ETC. This Agreement may not be
amended, changed, supplemented, waived or otherwise modified or terminated,
except upon the execution and delivery of a written agreement executed by the
parties hereto.
(e) NOTICES. All notices, requests, claims, demands and other
communications hereunder shall be made in accordance with the notice provisions
set forth in the Voting Agreement.
(f) SEVERABILITY. Whenever possible, each provision of this
Agreement shall be interpreted in such manner as to be effective and valid under
applicable law but if any provision of this Agreement becomes or is declared by
a court of competent jurisdiction to be invalid, illegal or unenforceable in any
respect under any applicable law or rule in any jurisdiction, such invalidity,
illegality or unenforceability shall not affect any other provision or portion
of any provision in such jurisdiction, and this Agreement shall be reformed,
construed and enforced in such jurisdiction as if such invalid, illegal or
unenforceable provision or portion of any provision had never been contained
herein.
(g) SPECIFIC PERFORMANCE. Each of the parties hereto
recognizes and acknowledges that a breach by it of any covenants or agreements
contained in this Agreement shall cause the other party to sustain damage for
which it would not have an adequate remedy at law for money damages, and
therefore each of the parties hereto agrees that in the event of any such breach
the aggrieved party shall be entitled to the remedy of specific performance of
such covenants and agreements and injunctive and other equitable relief in
addition to any other remedy to which it may be entitled, at law or in equity.
(h) NO WAIVER. The failure of any party hereto to exercise any
right, power or remedy provided under this Agreement or otherwise available in
respect hereof at law or in equity, or to insist upon compliance by any other
party hereto with its obligations hereunder, and any custom or practice of the
parties at variance with the terms hereof, shall not constitute a waiver by such
party of its right to exercise any such or other right, power or remedy or to
demand such compliance.
(i) GOVERNING LAW. This Agreement shall be governed and
construed in accordance with the laws of the State of Delaware, without giving
effect to the principles of conflicts of law thereof.
(j) COUNTERPARTS. This Agreement may be executed in one or
more counterparts, each of which shall be deemed to be an original, but all of
which, taken together, shall constitute one and the same Agreement and shall
become effective when one or more of the counterparts have been signed by each
of the parties and delivered to the other parties.
5
<PAGE>
IN WITNESS WHEREOF, Ocean Group and Stockholder have caused this
Agreement to be duly executed as of the day and year first above written.
OCEAN GROUP PLC,
an England and Wales company
By:
----------------------------
Name: John M. Allan
Title: Chief Executive
DAVID H. WEDAMAN
-------------------------------
[SIGNATURE PAGE FOR OCEAN GROUP/STOCKHOLDER STOCK PURCHASE AND STOCKHOLDER
AGREEMENT]
6
<PAGE>
Exhibit (c)(10)
MARK VII, INC.
965 Ridge Lake Boulevard
Memphis, Tennessee 38120
July 8, 1999
OCEAN GROUP PLC
Ocean House
The Ring
Bracknell,
Berkshire, England
RG12 1AN
Attention:
In connection with your consideration of a possible strategic alliance or
business transaction with Mark VII, Inc., a Delaware corporation, and its
subsidiaries (collectively, with such subsidiaries, the "Company") (a
"Transaction"), the Company is prepared to make available to you certain
information concerning the business, financial condition, operations, assets and
liabilities of the Company. As a condition to such information being furnished
to you and your directors, officers, employees, agents, advisors (including,
without limitation attorneys, accountants, consultants, bankers and financial
advisers), financing sources or affiliates (such term is used in this letter
agreement as defined in Rule 12b-2 of the Securities Exchange Act of 1934, as
amended) (collectively, "Representatives"), you agree to treat any information
concerning the Company (whether prepared by the Company, its advisors or
otherwise and irrespective of the form of communication) which has been or will
be furnished to you or to your Representatives by or on behalf of the Company
(herein collectively referred to as the "Evaluation Material") in accordance
with the provisions of this letter agreement, and to take or abstain from taking
certain other actions to the extent hereinafter set forth.
The term "Evaluation Material" shall be deemed to include all notes, analyses,
compilations, studies, interpretations or other documents prepared by you or
your Representatives to the extent that such notes, analyses, compilations,
studies, interpretations or other documents contain, reflect or are based upon
the Evaluation Material. The term "Evaluation Material" does not include
information which (i) is or becomes generally available to the public other than
as a result of a disclosure by you or your Representatives, (ii) was within your
possession prior to its being furnished to you by or on behalf of the Company
pursuant hereto, provided that the source of such information was not, to the
best of your knowledge, bound by a confidentiality agreement with or other
contractual, legal or fiduciary obligation of confidentiality to the Company
<PAGE>
Ocean Group PLC
July 8, 1999
Page 2
or any other party with respect to such information or (iii) becomes available
to you from a source other than the Company or any of its Representatives,
provided that such source is not, to the best of your knowledge, bound by a
confidentiality agreement with or other contractual, legal or fiduciary
obligation of confidentiality to the Company or any other party with respect to
such information.
You hereby agree that you and your Representatives shall use the Evaluation
Material solely for the purpose of evaluating, negotiating or advising with
respect to a Transaction that the Evaluation Material will be kept confidential
and that you and your Representatives will not disclose any of the Evaluation
Material in any manner whatsoever; provided, however, that (i) you may make any
disclosure of such information to the extent that the Company gives its prior
written consent to such disclosure and (ii) any such information may be
disclosed to your Representatives who need to know such information for the sole
purpose of evaluating, negotiating or advising with respect to a Transaction,
and who are informed of the confidential nature of such information and of the
terms of this letter agreement. In any event, you shall be responsible for any
breach of this letter agreement by any of your Representatives and you agree, at
your sole expense, to take all reasonable measures (including but not limited to
court proceedings) to restrain your Representatives from disclosing or using the
Evaluation Material in breach of the terms of this letter agreement. You and
your Representatives will be bound by your obligations of confidentiality
hereunder for three (3) years from the date hereof.
In addition, you and we agree that, except as required by law, without the prior
written consent of the other party, you and your Representatives, and we and our
Representatives, will not disclose to any other person the fact that the
Evaluation Material has been made available to you, that discussions or
negotiations are taking place concerning a Transaction or any of the terms,
conditions or other facts with respect thereto (including the status thereof).
The term "person" as used in this letter agreement shall be broadly interpreted
to include the media and any corporation, partnership, group, individual or
other entity.
In the event that you or any of your Representatives are requested or required
(by deposition, interrogatories, requests for information or documents in
legal proceedings, subpoena, civil investigative demand or other similar
process) to disclose any of the Evaluation Material, you shall provide the
Company with prompt written notice of any such request or requirement so that
the Company may seek a protective order or other appropriate remedy and/or waive
compliance with the provisions of this letter agreement. If, in the absence of a
protective order or other remedy or the receipt of a waiver by the Company, you
or any of your Representatives conclude, after consultation with your counsel,
that you are required to disclose Evaluation Material to any tribunal or risk
standing liable for contempt or suffering other censure or penalty, you or your
Representatives may, without liability hereunder, disclose to such tribunal only
that portion of the Evaluation Material which such counsel advises you is
legally required to
<PAGE>
Ocean Group PLC
July 8, 1999
Page 3
be disclosed, provided that you exercise your reasonable best efforts to
preserve the confidentiality of the Evaluation Material, including, without
limitation, by cooperating with the Company, at the Company's expense, to obtain
an appropriate protective order or other reliable assurance that confidential
treatment will be accorded the Evaluation Material by such tribunal.
If you decide that you do not wish to proceed with a Transaction, you will
promptly inform the Company of that decision. In that case, or at any time upon
the request of the Company for any reason, you will promptly deliver to the
Company all documents (and all copies thereof) furnished to you or your
Representatives by or on behalf of the Company pursuant hereto; provided
however, that your counsel shall be permitted to retain one permanent file copy
of each such document. In the event of such a decision or request, except as
required by law, all other Evaluation Material prepared by you or your
Representatives shall be destroyed and no copy thereof shall be retained;
provided, however, that your counsel shall be permitted to retain one permanent
file copy of such other Evaluation Material. Notwithstanding the return or
destruction of the Evaluation Material, you and your Representatives will
continue to be bound by your obligations of confidentiality hereunder for three
(3) years from the date hereof.
You understand and acknowledge that neither the Company nor any of its
Representatives (including, without limitation, Deutsche Bank Alex. Brown) make
any representation or warranty, express or implied, as to the accuracy or
completeness of the Evaluation Material. You agreed that neither the Company nor
any of its Representatives (including, without limitation, Deutsche Bank Alex.
Brown) shall have any liability to you or to any of your Representatives
relating to or resulting from the use of the Evaluation Material. Only those
representations or warranties which are made in a final definitive agreement
regarding a Transaction, when, as and if executed, and subject to such
limitations and restrictions as may be specified therein, will have any legal
effect.
In addition, you hereby acknowledge that you are aware (and that your
Representatives who are apprised of a possible Transaction have been advised) of
your obligations under the United States securities laws.
In consideration of the Evaluation Material being furnished to you, you hereby
agree that, for a period of two (2) years from the date hereof, neither you nor
any of your affiliates will solicit to employ any of the current officers,
employees or agents of the Company with whom you come in contact during your
evaluation of a possible Transaction so long as they are employed by or
affiliated with the Company without obtaining the prior written consent of the
Company.
In consideration of the Evaluation Material being furnished to you, you hereby
agree that, without the prior written consent of the Board of Directors of the
Company, for a period of three (3) years from the date hereof neither you nor
any of your affiliates, in any manner whatsoever, directly or indirectly, will,
acting alone or as part of a group (a)
<PAGE>
Ocean Group PLC
July 8, 1999
Page 4
acquire or offer or agree to acquire, by purchase or otherwise, any securities
(or direct or indirect rights or options to acquire any securities) of the
Company, or seek by any action not permitted under this letter agreement to
influence or control the management or policies of the Company, or (b) propose
to (i) acquire or offer or agree to acquire any securities (or direct or
indirect rights or options to acquire any securities) or assets of the Company
or (ii) influence or control the management or policies of the Company. Nothing
in this paragraph will prevent you from (i) making a non-public offer to the
Board of Directors of the Company or (ii) acquiring any shares of the Company's
common stock as contemplated by any definitive agreement that you and we may
enter into.
In addition, you agree that, for a period of three (3) years from the date
hereof, you will not, directly or indirectly, present, or propose to present, to
the stockholders of the Company any proposal or offer for a merger, tender or
exchange offer or other form of business combination involving the Company, or
effect, publicly propose to effect, or cause to occur any of the foregoing, that
previously has not been approved in writing by the Board of Directors of the
Company, nor will you, directly or indirectly, solicit, or propose (whether
publicly or otherwise) to solicit, proxies or consents to vote or become a
participant in any "election contest" with respect to the Company (as such terms
are used in Rule 14a-1 and Rule 14a-11 of Regulation 14A under the Securities
Exchange Act of 1934, as amended).
The two preceding paragraphs will not apply in a situation in which a third
party has made a bona fide public offer, either to the Company's Board of
Directors or directly to the Company's shareholders, or has commenced a
solicitation of proxies or become a participant in any "election contest."
You agree that unless and until a final definitive agreement regarding a
Transaction has been executed and delivered, neither the Company nor you will be
under any legal obligation of any kind whatsoever with respect to a Transaction
by virtue of this letter agreement except for the matters specifically agreed to
herein. You further acknowledge and agree that the Company reserves the right,
in its sole discretion, to reject any and all proposals made by you or any of
your Representatives with regard to a Transaction, and to terminate discussions
and negotiations with you at any time.
This letter agreement may not be assigned in whole or in part by any party
hereto without the prior written consent of the other parties.
It is understood and agreed that no failure or delay by any party hereto in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder.
<PAGE>
Ocean Group PLC
July 8, 1999
Page 5
It is further understood and agreed that money damages would not be a sufficient
remedy for any breach of this letter agreement by any party hereto or any of
such party's Representatives and that the non-breaching party or parties shall
be entitled to seek equitable relief, including injunction and specific
performance, as a remedy for any such breach. Such remedies shall not be deemed
to be the exclusive remedies for a breach of this letter agreement but shall be
in addition to all other remedies available at law or equity. In the event of
litigation relating to this letter agreement, if a court or competent
jurisdiction determines that any party hereto or any of such party's
Representatives have breached this letter agreement, then such breaching party
shall be liable for and pay to the non-breaching party or parties the reasonable
legal fees incurred by such non-breaching party or parties in connection with
such litigation, including any appeal therefrom.
To the extent that the Company enters into a confidentiality agreement on more
favorable terms than contained herein, we will so advise you, and, if you
request, we will amend this letter agreement to incorporate such more favorable
terms.
This letter agreement shall be governed by and construed in accordance with the
laws of the State of Delaware, without giving effect to the principles of
conflicts of law thereof. The parties hereto agree and consent to personal
jurisdiction in any action brought in any court, federal or state, within the
State of Delaware having subject matter jurisdiction, in connection with any
matter arising under this letter agreement.
This letter agreement expressly supercedes the Confidentiality Agreement between
the Company and you dated as of December ___, 1998.
(Remainder of page intentionally left blank.)
<PAGE>
Ocean Group PLC
July 8, 1999
Page 6
Please confirm your agreement with the foregoing by signing and returning one
copy of this letter agreement to the undersigned, whereupon this letter
agreement shall become a binding agreement between the Company and you.
Very truly yours,
MARK VII, INC.
By /s/ Mark A. Skoda
-------------------------------
Name: Mark A. Skoda
Title: President
ACCEPTED AND AGREED AS OF THE
DATE FIRST WRITTEN ABOVE:
OCEAN GROUP PLC
By /s/ Ian R. Smith
-------------------------------
Name: Ian R. Smith
Title: Group Commercial Director
