As filed with the Securities and Exchange Commission on August 15, 1997
Registration No. 333-31227
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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
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Form S-3
Registration Statement
Under
The Securities Act of 1933
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TYCO INTERNATIONAL LTD.
(Exact name of registrant as specified in its charter)
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BERMUDA NOT APPLICABLE
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(State or other jurisdiction (IRS Employer
of incorporation or organization) Identification No.)
CEDAR HOUSE
41 CEDAR AVENUE
HAMILTON HM12 BERMUDA
(441) 292-2033
(Address, including zip code, and telephone number, including
area code, of registrant's principal executive offices)
MARK H. SWARTZ
VICE PRESIDENT
TYCO INTERNATIONAL LTD.
ONE TYCO PARK
EXETER, NEW HAMPSHIRE 03833
(603) 778-9700
(Name, address, including zip code, and telephone number,
including area code, of agent for service)
*Tyco International Ltd. maintains its registered offices at Cedar House, 41
Cedar Avenue, Hamilton HM12 Bermuda. The executive office of the subsidiary that
supervises the activities of the subsidiaries of Tyco International Ltd. in
North America is located at One Tyco Park, Exeter, New Hampshire 03833. The
telephone number there is (603) 778-9700.
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COPIES TO:
JOSHUA M. BERMAN, ESQ. NEIL ANDERSON, ESQ.
KRAMER, LEVIN, NAFTALIS & FRANKEL SULLIVAN & CROMWELL
919 THIRD AVENUE 125 BROAD STREET
NEW YORK, NEW YORK 10022 NEW YORK, NEW YORK 10004
<PAGE>
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Approximate date of commencement of proposed sale to the public: From time
to time after the effective date of this Registration Statement.
If the only securities being registered on this form are being offered pur-
suant to dividend or interest reinvestment plans, check the following box. [ ]
If any of the securities being registered on this form are to be offered on
a delayed or continuous basis pursuant to Rule 415 under the Securities Act of
1933, other than securities offered only in connection with dividend or interest
reinvestment plans, check the following box. [x]
If this Form is filed to register additional securities for an offering
pursuant to Rule 462(b) under the Securities Act, please check the following box
and list the Securities Act registration statement number of the earlier
effective registration statement for the same offering. [ ]
If this Form is a post-effective amendment filed pursuant to Rule 462(c)
under the Securities Act, check the following box and list the Securities Act
registration statement number of the earlier effective registration statement
for the same offering. [ ]
If delivery of the prospectus is expected to be made pursuant to Rule 434,
please check the following box. [ ]
CALCULATION OF REGISTRATION FEE
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
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PROPOSED PROPOSED
TITLE OF EACH CLASS OF AMOUNT TO MAXIMUM MAXIMUM
SECURITIES TO BE REGISTERED BE REGISTERED OFFERING PRICE AGGREGATE AMOUNT OF
PER SECURITY(1) OFFERING PRICE(1) REGISTRATION FEE
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<S> <C> <C> <C> <C>
Common Shares, par value $0.20
per share........................... 12,517,072 $ 75.875 $949,732,838 $287,800
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A Warrants(2) 21,910 15.46 338,729 N/A(3)
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B Warrants(2) 13,657 20.62 281,607 N/A(3)
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</TABLE>
(1) Estimated solely for purposes of calculating the registration fee
pursuant to Rule 457 ("Rule 457") promulgated under the Securities Act
of 1933, as amended, on the basis of the average of the high and low
prices of the Common Shares on the New York Stock Exchange on August
14, 1997.
(2) Each Warrant is exercisable for 2.5897 Common Shares.
(3) Pursuant to Rule 457(g) under the Securities Act, as amended, no
separate fee is being paid with respect to the A Warrants and the B
Warrants, as the Common Shares subject thereto are also being
registered.
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The Registrant hereby amends this Registration Statement on such date
or dates as may be necessary to delay its effective date until the Registrant
shall file a further amendment which
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<PAGE>
specifically states that this Registration Statement shall thereafter become
effective in accordance with Section 8(a) of the Securities Act of 1933, as
amended, or until this Registration Statement shall become effective on such
date as the Commission, acting pursuant to said Section 8(a), may determine.
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<PAGE>
SUBJECT TO COMPLETION
PRELIMINARY PROSPECTUS DATED AUGUST 15, 1997
PROSPECTUS
12,517,072 Common Shares
21,910 A Warrants
13,657 B Warrants
TYCO INTERNATIONAL LTD.
This Prospectus relates to the offering of 12,517,072 common shares
(the "Shares"), par value $.20 per share (the "Common Shares"), of Tyco
International Ltd., a Bermuda company ("Tyco" or the "Company"), 21,910 A
Warrants (the "A Warrants") and 13,657 B Warrants (the "B Warrants", and
together with the A Warrants, the "Warrants"; the Warrants together with the
Shares, the "Securities") to acquire Common Shares, by certain security holders
of the Company. 92,108 of the Shares (the "Warrant Shares") constitute Common
Shares issuable upon exercise of the Warrants. The Warrants were originally
issued by Kendall International, Inc. ("Kendall") to certain security holders of
the Company (the "Kendall Selling Securityholders") and assumed by the Company
pursuant to the terms of the merger of Kendall with a subsidiary of the Company
on October 19, 1994.
12,424,964 of the Shares may be offered from time to time by Westar
Capital, Inc. (the "Westar Selling Shareholder", and together with the Kendall
Selling Securityholders, the "Selling Shareholders") in one or more underwritten
public offerings at prevailing market prices or in privately negotiated block
trades, subject to certain limitations. The Warrants and/or the Warrant Shares
may be offered from time to time by the Kendall Selling Securityholders through
ordinary brokerage transactions on the New York Stock Exchange (Warrant Shares
only), in the over-the-counter market, in privately negotiated transactions or
otherwise, at market prices prevailing at the time of sale or at negotiated
prices. The Company will not receive any of the proceeds from the sale of
Securities by the Selling Shareholders. The Company will pay certain expenses
related to the offering of the Securities, estimated at $185,000. The Company
may receive $5.97 per Common Share in connection with the exercise of A Warrants
(or up to an aggregate of $338,737) and $7.96 per Common Share in connection
with the exercise of B Warrants (or up to an aggregate of $281,529). See
"Selling Shareholders."
The resale of the Securities by the Selling Shareholders is subject to
prospectus delivery and other requirements of the Securities Act of 1933, as
amended ("Securities Act"). The Selling Shareholders and any agents or
broker-dealers that participate with the Selling Shareholders in the sale of the
Securities may be deemed "underwriters" under the Securities Act, and
commissions received by them and any profit on the resale of the Securities may
be deemed to be underwriting commissions or discounts under the Securities Act.
THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE
SECURITIES AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS
THE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE ACCURACY OR
ADEQUACY OF THIS PROSPECTUS. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL
OFFENSE.
THE DATE OF THIS PROSPECTUS IS AUGUST , 1997
<PAGE>
AVAILABLE INFORMATION
The Company is subject to the informational requirements of the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), and in
accordance therewith files reports, proxy statements and other information with
the Securities and Exchange Commission (the "Commission"), all of which may be
inspected and copied at the public reference facilities maintained by the
Commission at Room 1024, 450 Fifth Street, N.W., Judiciary Plaza, Washington,
D.C. 20549, and at the following Regional Offices of the Commission: Chicago
Regional Office, Suite 1400, Northwestern Atrium Center, 500 West Madison
Street, Chicago, Illinois 60661; and New York Regional Office, Seven World Trade
Center, 13th Floor, New York, New York 10048. Copies of such material can be
obtained at prescribed rates from the Public Reference Section of the Commission
at 450 Fifth Street, N.W., Judiciary Plaza, Washington, D.C. 20549. The
Commission maintains a site on the World Wide Web, and the reports, proxy
statements and other information filed by the Company with the Commission may be
accessed electronically on the Web at http://www.sec.gov. Such material can also
be inspected at the offices of the New York Stock Exchange, 20 Broad Street, New
York, New York 10005, where the Common Shares are listed.
This Prospectus constitutes part of a Registration Statement on Form
S-3 (the "Registration Statement") filed by the Company with the Commission
under the Securities Act of 1933, as amended (the "Securities Act"). This
Prospectus omits certain of the information contained in the Registration
Statement in accordance with the rules and regulations of the Commission.
Reference is hereby made to the Registration Statement and related exhibits for
further information with respect to the Company and the Securities. Statements
contained herein concerning the provisions of any document are not necessarily
complete and, in each instance, where a copy of such document has been filed as
an exhibit to the Registration Statement or otherwise has been filed with the
Commission, reference is made to the copy of the applicable document so filed.
Each such statement is qualified in its entirety by such reference.
INCORPORATION OF CERTAIN INFORMATION BY REFERENCE
The following documents, which have been filed by the Company with the
Commission pursuant to the Exchange Act, are hereby incorporated by reference in
this Prospectus:
The Company's Annual Report on Form 10-K for the fiscal year ended
December 31, 1996.
The Company's Quarterly Reports on Form 10-Q for the quarters ended
March 31, 1997 and June 30, 1997.
The Company's Current Reports on Form 8-K dated March 25, 1997 and July
10, 1997.
In addition, the following documents, which have been filed by Tyco
International (US) Inc., a Massachusetts corporation (formerly Tyco
International Ltd.; "Old Tyco") with the Commission pursuant to the Exchange
Act, are hereby incorporated by reference in this Prospectus:
Old Tyco's Annual Report on Form 10-K for the fiscal year ended June
30, 1996.
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<PAGE>
Old Tyco's Quarterly Reports on Form 10-Q for the quarters ended
September 30, 1996, December 31, 1996 and March 31, 1997.
Old Tyco's Current Reports on Form 8-K dated October 29, 1996, March 4,
1997, March 25, 1997 and March 28, 1997.
All documents filed by the Company with the Commission pursuant to
Sections 13(a), 13(c), 14 or 15(d) of the Exchange Act after the date of this
Prospectus and prior to the termination of the offering of the Shares made
hereby shall be deemed to be incorporated by reference into this Prospectus from
the date of filing of such documents. Any statement contained in a document
incorporated or deemed to be incorporated by reference herein shall be deemed to
be modified or superseded for purposes of this Prospectus to the extent that a
statement contained herein or in any other subsequently filed document which
also is or is deemed to be incorporated by reference herein modifies or
supersedes such statement. Any statement so modified or superseded shall not be
deemed, except as so modified or superseded, to constitute a part of this
Prospectus.
The Company will provide without charge to each person to whom a copy
of this Prospectus is delivered, including any beneficial owner of Securities,
upon the written or oral request of any such person, a copy of any and all of
the documents that have been or may be incorporated by reference herein other
than exhibits to such documents (unless such exhibits are specifically
incorporated by reference into such documents). Such requests should be directed
to David Brownell, c/o Tyco International (US) Inc., One Tyco Park, Exeter, New
Hampshire 03833 (telephone: (603) 778-9700).
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<PAGE>
THE COMPANY
Tyco International Ltd., a Bermuda company, is the continuing public
company resulting from the business combination (the "ADT Merger") on July 2,
1997 of Tyco International Ltd., a Massachusetts corporation ("Old Tyco"), and
ADT Limited, a Bermuda company ("ADT"). In the ADT Merger, Old Tyco merged with
a subsidiary of ADT, and ADT changed its name to Tyco International Ltd.
Tyco is the largest contractor in the world for design, installation
and servicing of fire protection systems and is a leading manufacturer and
distributor of fire detection and fire suppression products. Tyco is also the
largest provider of electronic security services in North America and the United
Kingdom. These services include the sale, installation, monitoring and
maintenance of electronic security devices and systems for intrusion detection,
surveillance and access control. Tyco manufactures and distributes flow control
products, disposable medical supplies and other specialty products, electrical
and electronic components and underwater telecommunication systems. Tyco also
operates a network of vehicle auction centers in the United States.
Tyco's strategy is to be a low-cost, high quality producer and provider
in each of its markets. It promotes its leadership position by investing in
existing businesses, developing new markets and acquiring complementary
businesses and products. Combining the strengths of its existing operations and
its business acquisitions, Tyco seeks to enhance shareholder value through
increased earnings per share and strong cash flows.
The Company is a Bermuda company. Its registered offices are located at
Cedar House, 41 Cedar Avenue, Hamilton HM12 Bermuda, and its telephone number is
(441) 292-2033. The executive office of the subsidiary that supervises the
activities of the subsidiaries of Tyco International Ltd. in North America is
located at One Tyco Park, Exeter, New Hampshire 03833, and its telephone number
is (603) 778-9700.
CURRENT DEVELOPMENTS
PROPOSED TRANSACTIONS
On May 12, 1997, Old Tyco entered into a definitive merger agreement
for the acquisition of INBRAND Corporation ("INBRAND") in a stock for stock
transaction (the "INBRAND Transaction") valued at approximately $410 million.
INBRAND, with annual revenues of approximately $240 million, is a producer of
adult incontinence products, feminine hygiene products and baby diapers. INBRAND
products are sold to the clinical and retail markets in North America and
Europe. In the INBRAND Transaction, which will be accounted for as a pooling of
interests, INBRAND shareholders will receive 0.43 of a Common Share for each
share of INBRAND common stock outstanding. As of July 11, 1997, INBRAND had
11,772,523 shares of common stock outstanding. The INBRAND Transaction is
contingent upon approval by the INBRAND shareholders at a meeting scheduled for
August 27, 1997 and other customary conditions.
On May 20, 1997, Old Tyco entered into a definitive merger agreement
for the acquisition of Keystone International, Inc. ("Keystone") in a stock for
stock transaction (the "Keystone Transaction") valued at approximately $1.2
billion. Keystone, with annual revenues of approximately $700 million,
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designs, manufactures and markets on a worldwide basis, industrial valves,
actuators and accessories used to control the flow of liquids, gases and solid
materials. Keystone products are sold to the food and beverage, water and
sewage, petroleum production and refining, natural gas, chemical power, and pulp
and paper industries. In the Keystone Transaction, which will be accounted for
as a pooling of interests, Keystone shareholders will receive Common Shares in
exchange for their shares of Keystone common stock. The exchange ratio will
depend upon the average daily trading price for Common Shares on the New York
Stock Exchange for the ten trading days ending five trading days prior to the
meeting of Keystone shareholders to vote on the transaction. For an average
daily trading price of between $57.21 and $68.29 the exchange ratio would be
0.54183 of a Common Share for each share of Keystone common stock outstanding.
The exchange ratio will be higher or lower for an average daily trading price
below or above this range. As of August 6, 1997, Keystone had 35,798,296 shares
of common stock outstanding. The Keystone Transaction is contingent upon
approval by the Keystone shareholders at a meeting scheduled for August 28, 1997
and other customary conditions. The Antitrust Division of the United States
Department of Justice (the "Antitrust Division") has raised certain concerns
regarding the Keystone Transaction that relate to certain specific flow control
products of Tyco and Keystone. Such products accounted for less than 2% of the
total revenues of Keystone in it most recent fiscal year. Tyco and Keystone do
not intend to consummate the Keystone Transaction unless and until the concerns
of the Antitrust Division have been resolved.
The Company reviews acquisition opportunities in the ordinary course of
its business, some of which may be material and some of which are currently
under investigation, discussion or negotiation.
OPERATING RESULTS OF OLD TYCO FOR THE FISCAL YEAR ENDED JUNE 30, 1997
The Company has announced results of operations of Old Tyco for the
fiscal year ended June 30, 1997 ("fiscal 1997"). Net income increased 35% to
$419.0 million, or $2.61 per share, for fiscal 1997, compared to $310.1 million,
or $2.03 per share for the fiscal year ended June 30, 1996 ("fiscal 1996").
Sales increased 30% to $6.6 billion in fiscal 1997 from $5.1 billion in fiscal
1996. The increases reflect internal growth as well as growth through
acquisitions. The internal growth was enhanced by continued worldwide expansion
of products and services coupled with productivity enhancements which improved
profit margins. Earnings of the Disposable and Specialty Products group
increased 25% to $364.4 million in fiscal 1997, compared to $291.7 million in
fiscal 1996. Earnings of the Fire Protection group increased 55% to $198.9
million in fiscal 1997, compared to $128.1 million in 1996. The increase
reflects improved margins in all geographic areas, particularly North America.
Earnings of the Flow Control group increased 37% to $156.3 million in fiscal
1997, compared to $114.1 million in fiscal 1996. The increase reflects higher
earnings at each of the group's operating units, as well as recent acquisitions.
Earnings of the Electrical and Electronic Components group increased 24% to
$109.3 million in fiscal 1997, compared to $88.5 million in fiscal 1996. The
increase reflects higher earnings at each of the group's operating units. The
earnings of the four business groups set forth above are stated before deduction
for general corporate expenses, interest expense and taxes.
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<PAGE>
The following table sets forth the announced summary results of
operations of Old Tyco for fiscal 1997 compared to fiscal 1996.
<TABLE>
<CAPTION>
For the year ended
June 30, 1997 June 30, 1996
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(In thousands except per share
amounts)
<S> <C> <C>
Sales................................................................ $6,597,629 $5,089,828
========== ==========
Income before income taxes ..........................................
$ 687,889 $ 523,897
Income taxes......................................................... (268,887) (213,750)
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Net Income........................................................... $ 419,002 $ 310,147
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Earnings Per Share................................................... $2.61 $2.03
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Common equivalent shares............................................. 160,268 152,862
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</TABLE>
For information on the operating results of ADT Limited (since renamed
Tyco International Ltd.) for the quarter and six months ended June 30, 1997,
please refer to the Company's Quarterly Report on Form 10-Q for the quarter
ended June 30, 1997.
USE OF PROCEEDS
All of the Securities offered hereby are being offered by the Selling
Shareholders. The Company will not receive any of the proceeds from the sale of
the Securities offered hereby. The Company may receive aggregate proceeds of up
to $338,729 (or $5.97 per share) from the exercise of A Warrants and aggregate
proceeds of up to $281,607 (or $7.96 per share) from the exercise of B Warrants
that are either offered pursuant to this Prospectus or whose Shares issuable
upon exercise thereof are so offered. The Company will use any proceeds from the
exercise of A Warrants and B Warrants for working capital and general corporate
purposes. See "Selling Shareholders."
SELLING SHAREHOLDERS
WESTAR SELLING SHAREHOLDER
As used in this section, the term "Selling Shareholder" refers to the
Westar Selling Shareholder.
GENERAL
The Selling Shareholder is a wholly-owned subsidiary of Western
Resources, Inc. ("Western"). Western is an investor-owned holding company that
is engaged principally in the production, purchase, transmission, distribution
and sale of electricity and the delivery and sale of natural gas. Western's
non-utility subsidiaries market natural gas primarily to large commercial and
industrial customers, provide
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electronic monitoring security services, and provide other energy-related
products and services. On February 7, 1997, Kansas City Power & Light Company
("KCPL") and Western entered into an agreement whereby KCPL would be merged with
and into Western.
The Selling Shareholder initially purchased Common Shares in January
and March 1996 from Laidlaw Inc., a corporation continued under the laws of
Canada, and has from time to time purchased and sold Common Shares and the
Company's Liquid Yield Option NotesTM ("LYONs") exchangeable into Common Shares
in the open market. Neither the Selling Shareholder nor Western has had any
representative on the Board of Directors or in the management of the Company. As
of the date of this Prospectus, the Selling Shareholder beneficially owns
12,424,964 Shares, or approximately 5% of the outstanding Common Shares. The
number of Shares sold and the timing of any such sales will depend on market
conditions and other factors. In the event that Western or any other subsidiary
of Western acquires any or all of the Shares from the Selling Shareholder,
Western or such subsidiary may be substituted for the Selling Shareholder, in
whole or in part, as a selling shareholder under this Prospectus.
THE SETTLEMENT AGREEMENT
In December 1996, Western announced its intention to offer to exchange
cash and Western stock for the outstanding common shares of the Company not
already owned by the Selling Shareholder (the "Western Offer"). At the same
time, Western filed a notice with the Company requisitioning a special general
meeting of ADT's shareholders to consider proposals (the "Western Proposals") to
remove the then current members of ADT's board, reduce the size of the board to
two and elect two officers of Western as directors of ADT. In March 1997, ADT
entered into an Agreement and Plan of Merger with Old Tyco, providing for the
merger of a subsidiary of ADT with Old Tyco. Western announced the withdrawal of
the Western Offer on July 2, 1997, the date the ADT Merger was consummated. The
Western Proposals were voted down at a special general meeting of shareholders
of the Company on July 8, 1997, at which the Common Shares held by the Selling
Shareholder were not represented.
In connection with the Western Offer, the Selling Shareholder filed an
action against ADT in U.S. District Court for the Southern District of Florida
alleging breaches of duties of ADT's directors to its shareholders. The Selling
Shareholder also filed a petition with the Supreme Court of Bermuda, which, as
amended, sought a payment in cash for the fair value of its Shares. Certain
subsidiaries of ADT which hold shares in Western and KCPL filed actions against
Western in the District Court of Shawnee County, Kansas, and against KCPL in the
Circuit Court of Jackson County, Missouri, seeking exercise of shareholder
rights to inspect books and records of Western and KCPL, respectively.
On August 14, 1997, Western, the Selling Shareholder and the Company
entered into a Settlement Agreement, dated as of July 16, 1997, providing for
the withdrawal or discontinuance of all outstanding litigation between the
parties, including the litigation involving KCPL, mutual releases and the
execution of the Western Registration Rights Agreement described below. A copy
of the Settlement Agreement is filed as an exhibit to the Registration Statement
and reference is made to such agreement for a complete statement of its
provisions.
WESTERN REGISTRATION RIGHTS AGREEMENT
The Selling Shareholder, Western and the Company have entered into a
Registration Rights Agreement, dated as of August 14, 1997 (the "Western
Registration Rights Agreement"). The Shares offered pursuant to this Prospectus
have been registered under the Securities Act and are being so offered in
accordance with the terms of the Western Registration Rights Agreement. A copy
of the Western
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Registration Rights Agreement is filed as an exhibit to the Registration
Statement, and the following description of the terms of the Western
Registration Rights Agreement is qualified by reference to such agreement.
General. The Western Registration Rights Agreement provides for the
registration of the Shares under the Registration Statement, which is a "shelf
registration statement" filed in accordance with the Securities Act. The Company
has agreed to use its best efforts to maintain the effectiveness of the
Registration Statement until the earlier of (i) the date that is twenty-four
(24) months from the effective date of the Registration Statement; and (ii) the
date when no more than 500,000 of the aggregate number of Registrable Securities
(as defined below) initially included in the Registration Statement
(appropriately adjusted for any stock dividend, stock split, reverse stock
split, combination, recapitalization, reclassification, exchange or similar
transaction with respect to the Common Shares) continue to constitute
Registrable Securities. The Western Registration Rights Agreement also provides
for certain "piggyback rights" for the registration and distribution of
Registrable Securities. Demand and piggyback rights under the Western
Registration Rights Agreement may be exercised by the Selling Shareholder and
any other person that constitutes a Holder (as defined below).
Definitions. The following definitions are used in the description of
the Western Registration Rights Agreement in this section:
"Block Trade" means the disposition at a single time in a single
transaction, including through one or more placement agents, by one or more
Holders, of any or all of the Registrable Securities to one or more
Institutional Investors. "Institutional Investor" means any insurance company,
pension fund, mutual fund, investment company, commercial bank, savings bank,
savings and loan association, investment banking company, trust company or any
finance or credit company, or any portfolio or investment fund managed by any of
the foregoing.
"Exclusive Period" means the period beginning on the date of the
Western Registration Rights Agreement and ending on the later of (i) October 3,
1997 and (ii) sixty (60) days from the date that the Shelf Registration
Statement is first declared effective by the SEC, not including any days during
which a Material Development Election (as defined) is in effect.
"Holder" means any person that owns Registrable Securities, provided
that no person other than Western, the Selling Shareholder and any other
wholly-owned, direct or indirect subsidiary of Western may be a Holder.
"Registrable Securities", as used in this section means (i) the Common
Shares owned by the Selling Shareholder as of the date of the Registration
Agreement; and (ii) any other securities issued or issuable as a result of or in
connection with any stock dividend, stock split or reverse stock split,
combination, recapitalization, reclassification, merger or consolidation,
exchange or distribution in respect of the securities referred to in clause (i)
above; provided that any Registrable Security ceases to be such after either (x)
the later of (1) July 16, 1998 and (2) such time as such security has become an
Unrestricted Security, or (y) such time as such security has been transferred,
with or without consideration, to any person other than a Holder.
"Unrestricted Securities" mean Common Shares that may be sold pursuant
to Rule 144(k) under the Securities Act, or any similar successor rule thereto
that may be promulgated by the Commission.
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<PAGE>
"Western," as used in the Western Registration Rights Agreement, means
Western Resources, Inc. and any successor corporation to Western Resources, Inc.
by way of merger, consolidation, exchange procedure or other business
combination pursuant to which all of the shareholders of Western Resources, Inc.
immediately prior to such business combination (other than shareholders
exercising statutory appraisal rights) are shareholders of the successor
immediately following such combination.
Demand Rights. Upon the written request of one or more Holders, the
Company will facilitate an underwritten offering of Shares under the
Registration Statement (a "Demand Underwritten Offering"), provided that the
Company is not obligated to facilitate any Demand Underwritten Offering for less
than 500,000 Shares (appropriately adjusted for any stock dividend, stock split,
reverse stock split, combination, recapitalization, reclassification, exchange
or similar transaction with respect to the Common Shares). One or more Holders
may also effect a Block Trade under the Registration Statement, provided that no
Unrestricted Securities may be sold in a Block Trade under the Registration
Statement. The total number of Demand Underwritten Offerings and Block Trades
under the Registration Statement may not exceed three in the aggregate.
Piggyback Rights of the Company in Demand Underwritten Offerings and of
the Holders in Underwritten Offerings of the Company for its Own Account. The
following provisions apply only after the end of the Exclusive Period.
If the Holders deliver a notice of a proposed Demand Underwritten
Offering, the Company, by notice to the Holders, may elect to participate in the
sale of Common Shares in such underwritten offering. If the Company delivers
such a notice, the Demand Underwritten Offering will be consummated as soon as
practicable after the earlier to occur of (x) the time any amendment to the
Registration Statement or any new Registration Statement required for the sale
of Common Shares by the Company becomes effective under the Securities Act, and
(y) thirty calendar days from the date of delivery by the Company to the Holders
of the notice of the Company's participation election.
If the Company proposes to file a registration statement with respect
to an underwritten offering of Common Shares for its own account, the Company is
required to give the Holders notice of such registration. The notice must offer
the Holders the opportunity to have any or all of the Registrable Securities
then held by them included in the registration statement. If any such
registration is not a shelf registration, the Registrable Securities that the
Holders elect to include will be offered in the underwritten offering together
with the offering of Common Shares by the Company. If any such registration is a
shelf registration, the Registrable Securities will be included in the
registration statement only for distribution in an underwritten offering
together with an underwritten offering of Common Shares by the Company.
If the Company proposes to effect an underwritten offering of Common
Shares for its own account under a previously effective registration statement,
the Company is required to give notice of such proposed offering to the Holders.
The notice must offer the Holders the opportunity to have any or all of the
Registrable Securities then held by them included in such underwritten offering,
to the extent such Registrable Securities have previously been registered either
under the Registration Statement or a registration statement filed pursuant to
the prior paragraph.
If the managing underwriter or underwriters of any underwritten
offering referred to in the prior three paragraphs advises the Company in
writing that the total amount of Common Shares of the Holders, the Company and
any other persons intended to be included in such underwritten offering is
sufficiently large to materially adversely affect the success of such offering,
then the amount of Common Shares to be offered in such public offering will be
allocated as follows:
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<PAGE>
(i) first, to the Company, in the amount the Company
proposes to offer, up to an amount equal to one-half of the
maximum amount (the "Maximum Amount") of Common Shares that the
managing underwriter or underwriters have advised can be sold in
the underwritten offering;
(ii) next, to the Holders, in the amount the Holders propose
to offer, up to an amount equal to one-half of the Maximum
Amount;
(iii) next, if the sum of the Common Shares allocated
pursuant to clauses (i) and (ii) above is less than the Maximum
Amount, to the Company or the Holders, whichever shall have
Common Shares proposed to be offered in the underwritten offering
which have not been allocated under clauses (i) or (ii) above, up
to an amount equal to the difference between the Maximum Amount
and the amount of Common Shares allocated under clauses (i) and
(ii) above; and
(iv) thereafter, if the sum of the Common Shares allocated
pursuant to clauses (i), (ii) and (iii) above is less than the
Maximum Amount, to any other Person entitled to participate in
the underwritten offering, up to an amount equal to the
difference between the Maximum Amount and the amount of Common
Shares allocated under clauses (i), (ii) and (iii) above.
Piggyback Rights of the Holders in Underwritten Offerings for the
Account of Third Parties. If the Company proposes to file a registration
statement with respect to the underwritten offering of any class of its equity
securities for the account of a holder of securities of the Company pursuant to
registration rights granted by the Company (a "Requesting Shareholder"), the
Company is required to give written notice of such proposed filing to the
Holders. Such notice must offer to all Holders the opportunity to have any or
all of the Registrable Securities held by them included in such registration
statement, provided that if any such registration is a shelf registration,
Registrable Securities will be included therein only for distribution in an
underwritten offering.
If the managing underwriter or underwriters of any such underwritten
offering advises the Company in writing that the total amount or kind of
securities of the Holders, the Company and any other persons intended to be
included in such underwritten offering is sufficiently large to materially
adversely affect the success of such offering, then the amount or kind of
securities to be offered for the accounts of Holders will be reduced pro rata,
together with the amount or kind of securities to be offered for the accounts of
any other persons exercising piggyback rights, to the extent necessary, before
the securities offered by the Company or any Requesting Shareholder are so
reduced.
Hold-back Election. In the case of any underwritten offering by the
Company, whether for its own account or for the account of a holder of
securities of the Company pursuant to registration rights granted by the
Company, the Holders agree, if and to the extent requested in writing by the
managing underwriter or underwriters administering such offering (a "Hold-Back
Election"), not to effect any public sale or distribution of securities of the
Company, except as part of such underwritten offering, during the period
beginning seven days prior to the closing date of such underwritten offering and
during the period ending on the earlier of (i) 45 days after such closing date
and (ii) the date such sale or distribution is permitted by such managing
underwriter or underwriters, provided that, if and to the extent it is
reasonable to do so, the Company will request of the managing underwriter or
underwriters to permit such sale or distribution prior to the date permitted
under clause (i) above. These hold-back provisions will cease to be of any
effect following the time that Western and its subsidiaries hold, in the
aggregate,
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less than three percent 3% of the outstanding Common Shares. The Company has
agreed to be subject to similar hold-back provisions with respect to any Demand
Underwritten Offering. Moreover, the Holders will not be subject to the forgoing
hold-back provisions in respect of an underwritten offering for the account of
any other holder of Common Shares that has not similarly agreed to be subject to
the hold-back provisions set forth in this paragraph in respect of a Demand
Underwritten Offering for the benefit of the Holders.
Material Development Election. The Company is entitled, for a period of
time not to exceed 30 consecutive days, to require that the Holders refrain from
effecting any distribution of their Registrable Securities pursuant to the
Registration Statement if the chief executive officer of the Company determines
in his reasonable good faith judgment that, in accordance with his understanding
of the disclosure requirements of applicable securities law, such distribution
would require disclosure of any financing (other than an underwritten secondary
offering of any securities of the Company), acquisition, corporate
reorganization or other transaction or development involving the Company or any
subsidiary of the Company that is or would be material to the Company and that,
in the reasonable good faith business judgment of such chief executive officer,
such disclosure would not at that time be in the best interests of the Company
(a "Material Development Election").
The Western Registration Rights Agreement provides that in no event may
the restrictions pursuant to one or more Hold-Back Elections or Material
Development Elections remain in effect for more than 75 days in the aggregate in
any calendar year. Also, the restrictions pursuant to two or more Material
Development Elections may not remain in effect for more than 45 days in the
aggregate in calendar year 1997.
Exclusive Period. The Company has agreed not to effect any underwritten
offering of Common Shares during the Exclusive Period, other than (x) an
underwritten offering of Registrable Securities and (y) an underwritten offering
of Common Shares for the benefit of a shareholder in satisfaction of
registration rights granted by the Company to such shareholder prior to the date
of the Western Registration Rights Agreement. The Company has also agreed that a
Hold-Back Election may not be effected during the Exclusive Period.
Expenses. Except as otherwise set forth below, each of the Company, on
the one hand, and the Holders, on the other, will bear it own costs in
connection with the Western Registration Rights Agreement, including without
limitation, internal expenses, fees and disbursements of its outside counsel and
its independent public accountants and fees and expenses of any other experts or
advisors. The Company is required to pay all printing expenses (including
expenses of printing and disseminating Prospectuses or any other necessary
documentation). The Holders are required to pay all registration and filing fees
and fees and expenses of compliance with state securities or blue sky laws and
all expenses incurred by the Company in connection with the participation in any
"road show" by members of the Company's management up to $100,000.
Underwriters. The Western Registration Rights Agreement provides that
each underwriter for any Demand Underwritten Offering will be mutually
acceptable to the Company and the Holders. The Company has no right to select or
approve any investment banking firm to act on behalf of the Holders in respect
of any Block Trade.
Other Provisions. The Western Registration Rights Agreement contains
other provisions typically found in agreements of this type, including
provisions with respect to indemnification and contribution.
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THE KENDALL SELLING SECURITYHOLDERs
As used in this section, the term "Selling Securityholders" refers to
the Kendall Selling Securityholders.
GENERAL
The Selling Securityholders were former holders of A Warrants or B
Warrants to acquire common stock of Kendall that received A Warrants or B
Warrants to acquire Common Shares as a result of the merger of Kendall with Old
Tyco on October 19, 1994 (the "Kendall Merger") and the subsequent ADT Merger.
Of the Shares being offered hereby, 56,740 shares are issuable pursuant to the
exercise of A Warrants and 35,368 shares are issuable pursuant to the exercise
of B Warrants. An aggregate of 21,910 A Warrants and 13,657 B Warrants, each of
which is exercisable for 2.5897 Common Shares are also being registered. The
identities and certain other information with respect to the Selling
Securityholders will be set forth in a Prospectus Supplement.
KENDALL REGISTRATION RIGHTS AGREEMENT
The Company has agreed generally to assume and perform the obligations
of Kendall under the Registration Rights Agreement, dated as of July 7, 1992, as
amended (the "Kendall Registration Rights Agreement"), among Kendall and certain
former institutional securityholders of Kendall (each, an "Institutional
Investor") and certain individual securityholders of Kendall (collectively,
together with certain other former securityholders of Kendall entitled to the
benefits, and bound by the terms of the Kendall Registration Rights Agreement,
the "Holders", which term includes the Selling Securityholders). The following
summary of certain terms of the Kendall Registration Rights Agreement does not
purport to be complete and is subject in all respects to the provisions of the
Kendall Registration Rights Agreement, a copy of which is filed as an exhibit to
the Registration Statement, to which reference is hereby made for a complete
statement of such provisions.
Demand Registration. The Kendall Registration Rights Agreement gives
the right to each Institutional Investor to demand that the Company file a
registration statement under the Securities Act covering the Registrable
Securities requested by such Institutional Investor and to use its best efforts
to cause such registration statement to become effective. If the Company
receives a demand for registration as provided in the previous sentence, it is
required to give notice of such demand to all Holders and, subject to certain
limitations, to use its best efforts to include in the registration statement
Registrable Securities which any other Holder has requested, within 15 business
days after the date of such notice, to be included. Each Institutional Investor
is entitled to make one demand for registration. However, the Company is not
required to file a registration statement unless the Holders have requested
registration of a prescribed minimum number of shares of Common Shares. The
Company is entitled to postpone such a registration statement for a reasonable
period not to exceed 180 days in certain circumstances. The Company does not
believe that any of the Institutional Investors retain the right to demand
registration.
As used in this section, Registrable Securities include the Common
Shares received as a result of the Kendall Merger (and the subsequent ADT
Merger) in exchange for shares of Kendall common stock that prior to the Kendall
Merger were entitled to registration rights under the Kendall Registration
Rights Agreement; Warrants received as a result of the Kendall Merger (and the
subsequent ADT
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Merger) in exchange for warrants to acquire shares of Kendall common stock that
prior to the Kendall Merger were entitled to registration rights, and Common
Shares issuable upon exercise of such Warrants; Common Shares issuable upon
exercise of Reallocation Rights (as defined); and securities issuable with
respect to such Common Shares or Warrants by way of a stock dividend or stock
split or in connection with a combination of shares, recapitalization, merger,
consolidation, reorganization or otherwise. Securities cease to be Registrable
Securities when disposed of pursuant to an effective registration statement or
sold or distributed to the public in reliance on an exemption from the
registration requirements of the Securities Act.
Piggyback Registration. The Kendall Registration Rights Agreement
provides that if the Company proposes to register any of its equity securities,
whether or not for its own account (subject to certain exceptions), the Company
will give notice of such registration to the Holders together with certain
information concerning the proposed offering. Upon the written request of any
Holder delivered within 15 business days of the notice, the Company will use its
best efforts to effect the registration under the Securities Act of all the
Registrable Securities that the Holder requests the Company to register,
provided that the Company will be permitted not to register or to delay the
registration of such Registrable Securities if it determines not to register or
to delay the registration of the securities otherwise intended to be registered.
If the registration involves an underwritten offering, all Holders
requesting inclusion in the underwritten offering must sell their Registrable
Securities to the underwriters on the same terms and conditions as apply to the
Company or the other selling securityholders participating in such registration.
If the registration involves an underwritten offering and the managing
underwriter advises the Company that, in its opinion, the number of securities
proposed to be registered must be limited due to market conditions, the Company
will include in such registration first, the number of securities the Company
proposes to sell, and second, the number of Registrable Securities of the
Holders and securities of other persons ("Other Persons") requested to be
included in such registration that, in the opinion of such managing underwriter,
can be sold, allocated pro rata among all such requesting Holders and Other
Persons on the basis of the relative number of securities as to which
registration has been requested by each such Holder and Other Person.
The Company may not enter into any agreement that will grant any person
piggyback rights with respect to any demand registration of the Holders that
fails to give effect or diminishes the rights of holders with respect to
piggyback registration as provided in the Kendall Registration Rights Agreement
or that grants registration rights to any person and does not require such
person expressly to recognize the rights of the Holders under the holdback
provisions referred to below.
Holdback Agreements. The Kendall Registration Rights Agreement provides
that, if any registration of Common Shares constituting Registrable Securities
is made in connection with an underwritten offering, the Holders will not effect
any sale or distribution, including in a private placement or pursuant to Rule
144 under the Securities Act, of any Common Shares during the seven days prior
to and during the 90-day period following the effective date of such
registration statement or such shorter period as the managing underwriter of the
relevant underwritten offering agrees to.
If any registration of Registrable Securities is made in connection
with an underwritten offering, the Company agrees, and will use reasonable
efforts to cause other persons holding 5% or more of the Common Shares (other
than institutional investment managers) to agree, not to effect any sale or
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distribution of any of the Company's equity securities or of any security
convertible into or exchangeable or exercisable for any equity security of the
Company during the period beginning seven days prior to the effective date of
such registration statement and ending on the earlier of (1) 180 days after such
effective date, and (2) 90 days after such effective date, if the managing
underwriter in such underwritten offering permits such sale or distribution as
not materially adversely affecting the offering. The Kendall Registration Rights
Agreement provides that the Holders participating in any such offering will use
their reasonable efforts to obtain such permission from the managing
underwriter.
Certain Other Provisions. All expenses incident to the Company's
performance of its registration obligations under the Kendall Registration
Rights Agreement, including filing fees and the reasonable fees and expenses of
one counsel retained by the Holders of a majority of the Registrable Securities
being registered, will be paid by the Company. The foregoing does not include
underwriting commissions or discounts or transfer taxes, if any, attributable to
the sale of Registrable Securities by the Holders.
The Kendall Registration Rights Agreement contains customary
indemnification provisions whereby the Company is obligated to indemnity and
hold harmless the Holders and certain related parties, and the Holders are
obligated under certain circumstances to indemnify and hold harmless the Company
and certain related parties, in each case in connection with liabilities
relating to the registration of the Registrable Securities. The Kendall
Registration Rights Agreement also provides for certain rights of contribution
in the event that such indemnity is unavailable.
DESCRIPTION OF CAPITAL STOCK
The summary of the terms of the share capital of Tyco set forth below
does not purport to be complete and is qualified by reference to the Tyco
Memorandum of Association (the "Tyco Memorandum") and the Bye-laws of Tyco (the
"Tyco Bye-Laws"). Copies of the Tyco Memorandum and the Tyco Bye-Laws are filed
as exhibits to the Registration Statement.
AUTHORIZED SHARE CAPITAL
Tyco's authorized share capital consists of 750,000,000 Common Shares,
par value $0.20 per share, 125,725,000 convertible cumulative redeemable
preference shares, par value $1 per share, divided into three classes (the
"Convertible Preference Shares") (including a class of first preference shares
(the "First Preference Shares")), and 25,000 exchangeable cumulative redeemable
preference shares, par value $1 per share (the "Exchangeable Preference Shares")
(the Convertible Preference Shares and the Exchangeable Preference Shares,
collectively, the "Preference Shares"). As of August 6, 1997, there were
243,231,006 Common Shares outstanding and no Preference Shares outstanding.
COMMON SHARES
Dividends. The Board of Directors of Tyco may declare dividends out of
profits of Tyco available for that purpose as long as there are no reasonable
grounds for believing that Tyco is, or after such dividend would be, unable to
pay its liabilities as they became due or if the realizable value of Tyco's
assets would thereby be less than the aggregate of its liabilities and its
issued share capital and
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<PAGE>
share premium accounts. Subject to such special rights as may be attached to any
other shares in Tyco, all dividends are payable according to the amounts paid or
credited as paid on Common Shares. Dividends are normally payable in U.S.
dollars, but holders with a registered address in the United Kingdom and other
countries outside the United States may receive payment in another currency. Any
dividend which is unclaimed may be invested or otherwise made use of by the
Board of Directors of Tyco and after a period of 12 years is forfeited and
reverts to Tyco.
Voting Rights. At any general meeting of Tyco, votes may be given in
person or by proxy and each holder of Common Shares is entitled, on a show of
hands, to one vote and, on a poll, to one vote for each Common Share held by
him. Any proxy must be a shareholder of Tyco.
Liquidation. On a liquidation of Tyco, holders of Common Shares are
entitled to receive any assets remaining after the payment of the Tyco's debts
and the expenses of the liquidation, subject to such special rights as may be
attached to any other class of shares.
Suspension of Rights. In certain circumstances, the rights of a
shareholder to vote and to receive any payment or income or capital in respect
of a Common Share may be suspended. Those circumstances include failure to
provide information about ownership of and other interests in Common Shares, if
so required in accordance with Tyco Bye-Laws.
Variation of Rights. If at any time the share capital of Tyco is
divided into different classes of shares, the rights attached to any class
(unless otherwise provided by the terms of the issue of the shares of that
class) may be varied with the consent in writing of the holders of three-fourths
of the issued shares of that class or with the sanction of a resolution passed
at a separate general meeting of the holders of the shares of that class by a
majority of three-fourths of such holders voting in person or by proxy.
Transfers. Common Shares may be transferred in any manner the Tyco
Board of Directors may approve. The Board of Directors may require the transfer
to be by an instrument signed by the transferor and, in the case of a partly
paid share, also by the transferee. The instrument must be in writing in the
usual common form or in any other form which the Board of Directors may approve
and must be lodged at the office of the registrar of Tyco for registration. The
Tyco Board of Directors may decline to register any transfer of shares on which
Tyco has a lien, any transfer of shares not fully paid up to a transferee of
whom they do not approve and any transfer of shares by a transferor or to a
transferee on whom Tyco has duly served a notice under the provisions of the
Tyco Bye-Laws during a period of suspension of voting rights.
Registrar and Transfer Agent. AS&K Services Limited is Tyco's
Registrar. ChaseMellon Shareholder Services, L.L.C. is the transfer agent for
Common Shares.
Two-for-One Stock Split. On August 1, 1997, Tyco announced a
two-for-one stock split on its Common Shares. The split will be in the form of a
100 percent stock distribution payable on October 22, 1997 to shareholders of
record on October 1, 1997.
TYCO PREFERENCE SHARES
Under the Tyco Bye-Laws, the Tyco Board of Directors, in its sole
discretion, may designate, allot and issue one or more series of First
Preference Shares from the authorized and unissued First
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Preference Shares. Subject to limitations imposed by law, the Tyco Memorandum or
the Tyco Bye-Laws, the Board of Directors is empowered to determine the
designation of, and the number of shares constituting, each series of First
Preference Shares, the dividend rate for each series, the terms and conditions
of any voting and conversion rights for each series, the amounts payable on each
series on redemption or return of capital and the preference and relative rights
among each series of First Preference Shares. At present, 7,500,000 First
Preference Shares have been designated as Series A First Preference Shares and
are reserved for issue upon exercise of the Rights under the Tyco Shareholder
Rights Plan.
WARRANTS
The A Warrants and the B Warrants were issued pursuant to two Warrant
Agreements, each dated as of July 7, 1992 (the "Warrant Agreements"), between
Kendall and Norwest Bank Minnesota, N.A, as warrant agent. Upon consummation of
the Kendall Merger and the subsequent ADT Merger, the Warrants became
exercisable for Common Shares and the Company assumed the obligations of Kendall
under the Warrant Agreements. The following summary of certain provisions of the
Warrants does not purport to be complete and is subject in all respects to the
provisions of the Warrant Agreements, copies of which are filed as exhibits to
the Registration Statement, to which reference is hereby made for a complete
statement of such provisions.
The Warrants were issued on July 7, 1992, in connection with the
restructuring of Kendall under Chapter 11 of the United States Bankruptcy Code
(the "Kendall Restructuring") to holders of equity securities of Kendall
outstanding prior to consummation of the Kendall Restructuring. Each A Warrant
entitled the holder thereof to purchase one share of common stock of Kendall at
a price of $15.46 per share, and each B Warrant entitled the holder to purchase
one share of common stock of Kendall at a price of $20.62 per share. As a result
of the Kendall Merger (and a two-for-one split of the Common Stock in November
1995) and the subsequent ADT Merger, each A Warrant entitles the holder thereof
to purchase 2.5897 Common Shares at an exercise price of $5.97 per share, and
each B Warrant entitles the holder thereof to purchase 2.5897 Common Shares at
an exercise price of $7.96 per share. The applicable exercise price and the
number of shares issuable upon exercise of the Warrants are subject to
adjustment in certain circumstances. Holders of the Warrants are not entitled to
any rights as shareholders of the Company until such holders properly exercise
the Warrants and acquire Common Shares.
SHAREHOLDER RIGHTS PLAN
In 1996, Tyco adopted a Shareholders Rights Plan (the "Tyco Shareholder
Rights Plan"). The Tyco Shareholders Rights Plan provides that unless certain
actions are taken by the Tyco Board of Directors, upon the Distribution Date (as
defined therein) each right other than those rights owned by an Acquiring Person
(as defined therein) will become exercisable. Each right entitles its holder,
among other things, to purchase Common Shares from Tyco at a 50% discount from
the market price of Common Shares on the Distribution Date.
STOCK EXCHANGE LISTING
The Common Shares are listed on the New York Stock Exchange, the London
Stock Exchange and the Bermuda Stock Exchange.
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PLAN OF DISTRIBUTION
The 12,424,964 Shares owned by the Westar Selling Shareholder may be
offered in one or more underwritten offerings or in one or more Block Trades,
provided that the total number of Demand Underwritten Offerings and Block Trades
may not exceed three in the aggregate. Shares that are Unrestricted Securities
may not be offered in a Block Trade pursuant to this Prospectus.
The Warrants and/or Warrant Shares may be offered and sold from time to
time by the Kendall Selling Securityholders on the New York Stock Exchange
(Warrant Shares only), in the over-the-counter market, in privately negotiated
transactions or otherwise, at prices and terms then prevailing, at prices
related to the then-current market price, or in negotiated transactions, or at
negotiated prices. The Warrants and/or Warrant Shares offered hereby may be sold
by one or more of the following methods, without limitation: (a) ordinary
brokerage transactions and transactions in which the broker solicits purchasers;
(b) a block trade in which a broker or dealer so engaged will attempt to sell
the shares as agent but may position and resell a portion of the block as
principal to facilitate the transaction; (c) purchases by a broker or dealer or
dealer as principal and resale by such broker or dealer for its account pursuant
to this Prospectus; and (d) face-to-face transactions between sellers and
purchasers without a broker-dealer.
No Securities may be offered pursuant to this Prospectus after such
time as the Shares owned by the Westar Selling Shareholder cease to be
Registrable Securities, or, if earlier, 24 months from the date of the Western
Registration Rights Agreement. See"Selling Shareholders--Westar Selling
Shareholder--Western Registration Rights Agreement."
In connection with the sale of Securities, underwriters may receive
compensation in the form of discounts, concessions, or commissions. Underwriters
may sell Securities to or through dealers, and such dealers may receive
compensation in the form of discounts, concessions, or commissions from the
underwriters and/or commissions from the purchasers for whom they may act as
agents. Underwriters, dealers, and agents that participate in the distribution
of Securities may be deemed to be underwriters, and any discounts or commissions
received by them and any profit on the resale of Securities by them may be
deemed to be underwriting discounts and commissions, under the Securities Act.
Any such underwriter or agent will be identified, and any such compensation
received will be described, in the Prospectus Supplement.
The Selling Shareholders and any broker-dealers who act in connection
with the sale of the Securities may be deemed to be "underwriters" within the
meaning of Section 2(11) of the Securities Act, and any commissions received by
them and profit on any resale of the Securities as principal might be deemed to
be underwriting discounts and commissions.
The Company has agreed to indemnify the Selling Shareholders against
certain liabilities, including liabilities under the Securities Act.
Underwriters and agents who participate in the distribution of Securities may be
entitled under agreements which may be entered into by the Company to
indemnification by the Company against certain liabilities, including
liabilities under the Securities Act.
The Company will pay expenses related to the Registration Statement and
this Prospectus (including registration fees with respect to the Warrant Shares)
estimated to be approximately $185,000. The Selling Shareholder will pay
expenses related to the Registration Statement and the Prospectus
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(including registration fees with respect to the Shares other than the Warrant
Shares) estimated to be approximately $345,680.
LEGAL MATTERS
The validity of the Common Shares to be sold pursuant to this
Prospectus will be passed upon by Appleby, Spurling & Kempe, Hamilton, Bermuda,
special counsel to Tyco.
EXPERTS
The supplemental consolidated financial statements of Tyco as of
December 31, 1996 and 1995 and for each of the three years in the period ended
December 31, 1996 included in Tyco's Current Report on Form 8-K and incorporated
by reference in this Prospectus give retroactive effect to the merger between
ADT Limited and Tyco International Ltd. (now Tyco International (US) Inc.) and
have been examined by Coopers & Lybrand. The consolidated financial statements
of ADT Limited as of December 31, 1996 and 1995 and for each of the three years
in the period ended December 31, 1996 (not separately presented, but
incorporated herein) have been audited by Coopers & Lybrand. The consolidated
financial statements of Tyco International Ltd (now Tyco International (US)
Inc.) as of December 31, 1996 and for the year then ended (not separately
presented or incorporated herein) and as of June 30, 1996 and 1995 and for each
of the three years in the period ended June 30, 1996 (not separately presented,
but incorporated herein) have been audited by Coopers & Lybrand L.L.P. Such
reports are incorporated by reference herein in reliance on the authority of
said firms as experts in accounting and auditing.
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PART II
INFORMATION NOT REQUIRED IN PROSPECTUS
ITEM 14. OTHER EXPENSES OF ISSUANCE AND DISTRIBUTION
The estimated expenses in connection with the issuance and distribution
of the Securities covered by this Registration Statement are as follows:
SEC registration fee (actual)............................. $287,800
Printing and engraving expenses........................... 25,000
Legal fees and expenses................................... 150,000
Accounting fees and expenses.............................. 45,000
Miscellaneous............................................. 25,000
--------
Total................................................. $532,800*
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* Includes $285,680 in registration fees, $50,000 in legal fees and expenses and
$10,000 in accounting fees and expenses paid by the Westar Selling Shareholder.
ITEM 15. INDEMNIFICATION OF DIRECTORS AND OFFICERS
Bye-Law 102 of the Tyco Bye-Laws provides, in part, that Tyco shall
indemnify its directors and other officers for all costs, losses and expenses
which they may incur in the performance of their duties as director or officer,
provided that such indemnification is not otherwise prohibited under the
Companies Act 1981 (as amended) of Bermuda. Section 98 of the Companies Act 1981
(as amended) prohibits such indemnification against any liability arising out of
the fraud or dishonesty of the director or officer. However, such section
permits Tyco to indemnify a director or officer against any liability incurred
by him in defending any proceedings, whether civil or criminal, in which
judgment is given in his favor or in which he is acquitted or when other similar
relief is granted to him.
The Registrant maintains $75,000,000 of insurance to reimburse its
directors and officers for charges and expenses incurred by them for wrongful
acts claimed against them by reason of their being or having been directors or
officers of the Registrant or any subsidiary thereof. Such insurance
specifically excludes reimbursement of any director or officer for any charge or
expense incurred in connection with various designated matters, including libel
or slander, illegally obtained personal profits, profits recovered by the
Registrant pursuant to Section 16(b) of the Exchange Act and deliberate
dishonesty.
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ITEM 16. EXHIBITS
3.1 --Memorandum of Association of Registrant (previously filed as an
Exhibit to Registrant's Annual Report on Form 10-K for the Year Ended
December 31, 1996)
3.2 --Certificate of Incorporation on Change of Name (previously filed as an
Exhibit to the Registrant's Current Report on Form 8-K filed July 10,
1997 ("July 10, 1997 8-K")
3.3 --Bye-Laws of the Registrant (previously filed as an Exhibit to the July
10, 1997 Form 8-K))
4.1 --Rights Agreement between Registrant and Citibank, N.A. dated as of
November 6, 1996 (previously filed as an Exhibit to Registrant's Form
8-A dated November 12, 1996)
4.2 --First Amendment between Registrant and Citibank, N.A. dated as of
March 3, 1997 to Rights Agreement between Registrant and Citibank, N.A.
dated as of November 6, 1996 (previously filed as an Exhibit to
Registrant's Form 8-A/A dated March 3, 1997)
4.3 --Second Amendment between Registrant and Citibank, N.A. dated as of
July 2, 1997 to Rights Agreement between Registrant and Citibank N.A.
dated as of November 6, 1996 (previously filed as an Exhibit to
Registrant's Form 8-A/A dated July 2, 1997)
5 --Opinion of Appleby, Spurling & Kempe regarding the validity of the
securites registered**
10.1 --Settlement Agreement, dated as of July 16, 1997, between Registrant
and Western Resources, Inc.*
10.2 --Registration Rights Agreement, dated August 14, 1997, among Westar
Capital, Inc., Western Resources, Inc. and Registrant*
10.3 --Registration Rights Agreement, dated as of July 7, 1992 (the "Kendall
Registration Rights Agreement"), among Kendall International, Inc.
(formerly CDK Holding Corporation; "Kendall") and certain holders of
Kendall securities (incorporated by reference to Exhibit 4.42 to the
Registration Statement on Form 10 of Kendall, as amended (the "Kendall
Form 10")).
10.4 --Amendment No. 1 to the Kendall Registration Rights Agreement, dated
July 11, 1994 (incorporated by reference to Exhibit 10(b) to Tyco
International (US) Inc. (formerly Tyco International Ltd., "Old Tyco")
Registration Statement on Form S-3, File No. 33-57509).
10.5 --Warrant Agreement, dated as of July 7, 1992, between Holding and
Norwest Bank Minnesota, N.A., as warrant agent (the "Warrant Agent")
(including the form of A Warrant) (incorporated by reference to Exhibit
10.46.1 to the Kendall Form 10).
10.6 --Warrant Agreement, dated as of July 7, 1992, between Kendall and the
Warrant Agent (including the form of B Warrant), (incorporated by
reference to Exhibit 10.46.3 to the Kendall Form 10).
23.1 --Consent of Coopers & Lybrand*
23.2 --Consent of Coopers & Lybrand L.L.P.*
23.3 --Consent of Appleby, Spurling & Kempe (contained in Exhibit 5)**
24 --Power of Attorney (contained on signature page)
- --------------------
*filed herewith
** to be filed by amendment
ITEM 17. UNDERTAKINGS
Insofar as indemnification for liabilities arising under the Securities
Act may be permitted to directors, officers and persons controlling the
Registrant pursuant to the foregoing provisions, the Registrant has been
informed that in the opinion of the Commission such indemnification is against
public policy as expressed in the Act and is, therefore, unenforceable. In the
event that a claim for indemnification against such liabilities (other than the
payment by the Registrant of expenses incurred or paid by a director, officer or
controlling person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or controlling person
in connection with the
II-2
<PAGE>
securities being registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent, submit to a court
of appropriate jurisdiction the question whether such indemnification by it is
against public policy as expressed in the Act and will be governed by the final
adjudication of such issue.
The undersigned Registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement;
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the Registration Statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represent a fundamental change in the information set forth
in the registration statement. Notwithstanding the foregoing, any
increase or decrease in volume of securities offered (if the total
dollar value of securities offered would not exceed that which was
registered) and any deviation from the low or high end of the
estimated maximum offering range may be reflected in the form of
prospectus filed with the Commission pursuant to Rule 424(b) if, in
the aggregate, the changes in volume and price represent no more than
a 20% change in the maximum aggregate offering price set forth in the
"Calculation of Registration Fee" table in the effective registration
statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the Registration
Statement or any material change to such information in the
Registration Statement;
provided, however, that paragraphs (1)(i) and (1)(ii) do not apply if the
Registration Statement is on Form S-3, Form S-8 or Form F-3, and the
information required to be included in a post-effective amendment by those
paragraphs is contained in periodic reports filed or furnished to the
Commission by the Registrant pursuant to Section 13 or 15(d) of the
Securities Exchange Act of 1934 that are incorporated by reference in the
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed
to be a new registration statement relating to the securities offered
therein, and the offering of such securities at that time shall be deemed
to be the initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the
termination of the offering.
The undersigned Registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
Registrant's annual report pursuant to Section 13(a) or 15(d) of the Securities
Exchange Act of 1934 (and, where applicable, each filing of an employee benefit
plan's annual report pursuant to Section 15(d) of the Securities Exchange Act of
1934) that is
II-3
<PAGE>
incorporated by reference in the Registration Statement shall be deemed to be a
new registration statement relating to the securities offered therein, and the
offering of such securities at that time shall be deemed to be the initial bona
fide offering thereof.
The undersigned Registrant hereby undertakes that: (1) for purposes of
determining any liability under the Securities Act of 1933, the information
omitted from the form of prospectus filed as part of this Registration Statement
in reliance upon Rule 430A and contained in a form of prospectus filed by the
Registrant pursuant to Rule 424(b)(1) or (4) or 497(h) under the Securities Act
shall be deemed to be part of this Registration Statement as of the time it was
declared effective; and (2) for the purpose of determining any liability under
the Securities Act of 1933, each post-effective amendment that contains a form
of prospectus shall be deemed to be a new Registration Statement relating to the
securities offered therein, and the offering of such securities at that time
shall be deemed to be the initial bona fide offering thereof.
II-4
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
Registrant certifies that it has reasonable grounds to believe that it meets all
of the requirements for filing on Form S-3 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the Town of Exeter, State of New Hampshire, on the 15th day of
August 1997.
TYCO INTERNATIONAL LTD.
By: /s/ MARK H. SWARTZ
-------------------
Mark H. Swartz
Executive Vice President-
Chief Financial Officer
(Principal Financial and
Accounting Officer)
KNOW ALL MEN BY THESE PRESENTS, that each of the undersigned
constitutes and appoints L. DENNIS KOZLOWSKI AND MARK H. SWARTZ, and each of
them, his true and lawful attorney-in-fact and agent, with full power of
substitution and resubstitution, for him and in his name, place and stead, in
any and all capacities, to sign this Registration Statement (including all
pre-effective and post-effective amendments), and to file the same, with all
exhibits thereto, and other documents in connection therewith, with the
Securities and Exchange Commission, granting unto such attorneys-in-fact and
agents, and each of them, full power and authority to do and perform each and
every act and thing requisite and necessary to be done in and about the
premises, as fully to all intents and purposes as he might or could do in
person, hereby ratifying and confirming all that such attorneys-in-fact and
agents or any of them, or their or his substitute or substitutes, may lawfully
do or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, this
Registration Statement has been signed by the following persons on August 15,
1997 in the capacities indicated below.
SIGNATURE TITLE
- --------- -----
/s/ L. DENNIS KOZLOWSKI Chairman of the Board, President, Chief
- ----------------------- Executive Officer and Director (Principal
L. Dennis Kozlowski Executive Officer)
/s/ MICHAEL A. ASHCROFT Director
- -----------------------
Michael A. Ashcroft
/s/ JOSHUA M. BERMAN Director and Vice President
- -----------------------
Joshua M. Berman
/s/ RICHARD S. BODMAN Director
- -----------------------
Richard S. Bodman
/s/ JOHN F. FORT Director
- -----------------------
John F. Fort
II-5
<PAGE>
/s/ STEPHEN W. FOSS Director
- -----------------------
Stephen W. Foss
/s/ RICHARD A. GILLELAND Director
- -----------------------
Richard A. Gilleland
/s/ PHILLIP M. HAMPTON Director
- -----------------------
Philip M. Hampton
/s/ JAMES S. PASMAN, JR. Director
- -----------------------
James S. Pasman, Jr.
/s/ W. PETER SLUSSER Director
- -----------------------
W. Peter Slusser
/s/ MARK H. SWARTZ Executive Vice President-Chief Financial Officer
- ----------------------- (Principal Financial and Accounting Officer)
Mark H. Swartz
/s/ FRANK E. WALSH, JR. Director
- -----------------------
Frank E. Walsh, Jr.
II-6
<PAGE>
INDEX TO EXHIBITS
Sequentially
Exhibit Numbered
Number Description Page
- ------ ----------- ----
3.1 --Memorandum of Association of Registrant (previously filed as an Exhibit
to Registrant's Annual Report on Form 10-K for the Year Ended December 31,
1996)
3.2 --Certificate of Incorporation on Change of Name (previously filed as an
Exhibit to the Registrant's Current Report on Form 8-K filed July 10, 1997
("July 10, 1997 8-K")
3.3 --Bye-Laws of the Registrant (previously filed as an Exhibit to the July
10, 1997 Form 8-K))
4.1 --Rights Agreement between Registrant and Citibank, N.A. dated as of
November 6, 1996 (previously filed as an Exhibit to Registrant's Form 8-A
dated November 12, 1996)
4.2 --First Amendment between Registrant and Citibank, N.A. dated as of March
3, 1997 to Rights Agreement between Registrant and Citibank, N.A. dated as
of November 6, 1996 (previously filed as an Exhibit to Registrant's Form
8-A/A dated March 3, 1997)
4.3 --Second Amendment between Registrant and Citibank, N.A. dated as of July
2, 1997 to Rights Agreement between Registrant and Citibank N.A. dated as
of November 6, 1996 (previously filed as an Exhibit to Registrant's Form
8-A/A dated July 2, 1997)
5 --Opinion of Appleby, Spurling & Kempe regarding the validity of the
securities registered**
10.1 --Settlement Agreement, dated as of July 16, 1997, between Registrant and
Western Resources, Inc.*
10.2 --Registration Rights Agreement, dated August 14, 1997, among Westar
Capital, Inc., Western Resources, Inc. and Registrant*
10.3 --Registration Rights Agreement, dated as of July 7, 1992 (the "Kendall
Registration Rights Agreement"), among Kendall International, Inc.
(formerly CDK Holding Corporation; "Kendall") and certain holders of
Kendall securities (incorporated by reference to Exhibit 4.42 to the
Registration Statement on Form 10 of Kendall, as amended (the "Kendall Form
10")).
10.4 --Amendment No. 1 to the Kendall Registration Rights Agreement, dated July
11, 1994 (incorporated by reference to Exhibit 10(b) to Tyco International
(US) Inc. (formerly Tyco International Ltd., "Old Tyco") Registration
Statement on Form S-3, File No. 33- 57509).
10.5 --Warrant Agreement, dated as of July 7, 1992, between Holding and Norwest
Bank Minnesota, N.A., as warrant agent (the "Warrant Agent") (including the
form of A Warrant) (incorporated by reference to Exhibit 10.46.1 to the
Kendall Form 10).
10.6 --Warrant Agreement, dated as of July 7, 1992, between Kendall and the
Warrant Agent (including the form of B Warrant), (incorporated by reference
to Exhibit 10.46.3 to the Kendall Form 10).
23.1 --Consent of Coopers & Lybrand*
23.2 --Consent of Coopers & Lybrand L.L.P.*
23.3 --Consent of Appleby, Spurling & Kempe (contained in Exhibit 5)**
24 --Power of Attorney (contained on signature page)
- -----------------
*filed herewith
** to be filed by amendment
II-7
ANNEX A
REGISTRATION RIGHTS AGREEMENT
Dated as of August 14, 1997
By and Among
WESTAR CAPITAL, INC.,
WESTERN RESOURCES, INC.
and
TYCO INTERNATIONAL LTD.
-----------------------------------------------------------------
COMMON SHARES
-----------------------------------------------------------------
<PAGE>
This REGISTRATION RIGHTS AGREEMENT is made and entered into as of
August 14, 1997, by and among WESTAR CAPITAL, INC. (the "Shareholder"), a Kansas
corporation and a wholly-owned subsidiary of Western Resources, Inc., WESTERN
RESOURCES, INC., a Kansas corporation, and TYCO INTERNATIONAL LTD., a Bermuda
company (the "Company")
The Shareholder is the beneficial owner of certain Registrable
Securities (as defined below) issued by the Company. The Company and the
Shareholder deem it to be in their respective best interests to set forth the
rights of the Shareholder in connection with public offerings and sales of the
Registrable Securities.
NOW, THEREFORE, in consideration of the premises and mutual covenants
and obligations hereinafter set forth, the Company, the Shareholder and Western
Resources, Inc., intending legally to be bound, hereby agree as follows.
SECTION 1. DEFINITIONS. As used in this Agreement, the following terms
shall have the following meanings:
"Affiliate" of any Person shall mean any other Person who either
directly or indirectly is in control of, is controlled by, or is under common
control with such Person. The term "control" (including the terms "controlling,"
"controlled by" and under "common control with") with respect to any Person
means possession, direct or indirect, of the power to direct or cause the
direction of the management and policies of such Person, whether through the
ownership of voting securities, by contract or otherwise.
"Block Trade" shall mean the disposition at a single time in a single
transaction, including through one or more placement agents, by one or more
Holders, of any or all of the Registrable Securities to one or more
Institutional Investors. "Institutional Investor" shall mean any insurance
company, pension fund, mutual fund, investment company, commercial bank, savings
bank, savings and loan association, investment banking company, trust company or
any finance or credit company, or any portfolio or investment fund managed by
any of the foregoing.
"Business Day" shall mean any Monday, Tuesday, Wednesday, Thursday or
Friday that is not a day on which banking institutions in the City of New York
are authorized by law, regulation or executive order to close.
"Common Shares" shall mean the common shares, par value $0.20 per
share, of the Company or any securities issued in exchange therefor in any
recapitalization, reclassification, merger, consolidation or similar
transaction.
"Designated Holder" shall mean the Shareholder or any other Holder
designated by notice in writing to the Company from Western to act as Designated
Holder.
<PAGE>
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended (or any similar successor federal statute), and the rules and
regulations thereunder, as the same are in effect from time to time.
"Exclusive Period" shall mean the period beginning on the date hereof
and ending on the later of (i) October 3, 1997 and (ii) sixty (60) days from the
date that the Shelf Registration Statement is first declared effective by the
SEC, not including any days during which a Material Development Election is in
effect
"Hold-Back Election" shall have the meaning set forth in Section 7(a)
hereof.
"Holder" shall mean any Person that owns Registrable Securities;
provided, however, that no person other than Western, the Shareholder and any
other wholly-owned, direct or indirect subsidiary of Western may be a Holder.
"Material Development Election" shall have the meaning set forth in
Section 7(b) hereof.
"Person" shall mean an individual, partnership, corporation, limited
liability company, joint venture trust or unincorporated organization, a
government or agency or political subdivision thereof or any other entity.
"Prospectus" shall mean the prospectus included in any Registration
Statement, as amended or supplemented by a prospectus supplement with respect to
the terms of the offering of any portion of the Registrable Securities covered
by such Registration Statement and by all other amendments and supplements to
the prospectus, including post-effective amendments and all material
incorporated by reference in such prospectus.
"Registrable Securities" shall mean (i) the Common Shares owned by the
Shareholder as of the date hereof; and (ii) any other securities issued or
issuable as a result of or in connection with any stock dividend, stock split or
reverse stock split, combination, recapitalization, reclassification, merger or
consolidation, exchange or distribution in respect of the securities referred to
in clause (i) above; provided, however, that any Registrable Security shall
cease to be such after either (x) the later of (1) July 16, 1998 and (2) such
time as such security has become an Unrestricted Security, or (y) such time as
such security has been transferred, with or without consideration, to any Person
other than a Holder.
"Registration Statement" shall mean any registration statement under
the Securities Act, including the Prospectus included therein, all amendments
and supplements to such Registration Statement, including post-effective
amendments, all exhibits and all material incorporated by reference in such
Registration Statement. Unless the context requires otherwise, "Registration
Statement" refers to a registration statement with respect to Registrable
Securities under this Agreement.
- 2 -
<PAGE>
"Rule 415" shall mean Rule 415 promulgated under the Securities Act or
any similar successor rule thereto that may be promulgated by the SEC.
"SEC" shall mean the Securities and Exchange Commission, or any other
federal agency at the time administering the Securities Act.
"Securities Act" shall mean the Securities Act of 1933, as amended (or
any similar successor federal statute), and the rules and regulations
thereunder, as the same are in effect from time to time.
"Shelf Registration" shall mean the registration of securities for sale
on a continuous or delayed basis pursuant to Rule 415. Unless the context
requires otherwise, "Shelf Registration" refers to a registration of Registrable
Securities.
"Shelf Registration Statement" shall mean a Registration Statement
filed in connection with a Shelf Registration of Registrable Securities in
accordance with Section 2 hereof.
"Underwritten Offering" shall mean a registered offering in which
securities are sold to one or more underwriters on a firm commitment basis for
reoffering to the public. Unless the context requires otherwise, "Underwritten
Offering" refers to an offering of Registrable Securities.
"Unrestricted Securities" shall mean Common Shares that may be sold
pursuant to Rule 144(k) under the Securities Act, or any similar successor rule
thereto that may be promulgated by the SEC.
"Western" shall mean Western Resources, Inc. and any successor
corporation to Western Resources, Inc. by way of merger, consolidation, exchange
procedure or other business combination pursuant to which all of the
shareholders of Western immediately prior to such business combination (other
than shareholders exercising statutory appraisal rights) are shareholders of the
successor immediately following such combination.
SECTION 2. SHELF REGISTRATION
(a) Filing and Effectiveness. As soon as reasonably practicable
following the date hereof (and in no event later than five (5) Business Days
from the date hereof), the Company shall file with the SEC a Shelf Registration
Statement for the sale by the Holders of the Registrable Securities. The Company
shall use its reasonable best efforts to cause the Shelf Registration Statement
to be declared effective as soon as practicable after the filing thereof, and
thereafter to keep it continually effective until the earlier of (i) the date
that is twenty-four (24) months from the effective date thereof; and (ii) the
date when no more than 500,000 of the aggregate number of Registrable Securities
initially included in the Shelf Registration Statement (appropriately adjusted
for any stock dividend, stock split, reverse stock split, combination,
recapitalization, reclassification, exchange or similar transaction with respect
to the Common
- 3 -
<PAGE>
Shares) shall continue to constitute Registrable Securities. The Shelf
Registration Statement shall be on Form S-3 (or any successor or substantially
similar form in use at the time), if the Company satisfies the eligibility
requirements for use of such Form. The Company represents and warrants to the
Shareholder that, as of the date of this Agreement, the Company is eligible to
use Form S-3 for the Shelf Registration of securities under the Securities Act
for transactions involving secondary offerings and agrees to use its reasonable
best efforts to preserve such eligibility for so long as the Company is
obligated to maintain the effectiveness of the Shelf Registration Statement.
(b) Subsequent Holders. If any person becomes a Holder of Registrable
Securities that were included in the Shelf Registration Statement subsequent to
the time that the Shelf Registration Statement became effective, the Company
shall add such Holder to the Shelf Registration Statement, on a timely basis,
through a post-effective amendment or a supplement to the Prospectus, as shall
be necessary in accordance with the rules of the SEC under the Securities Act to
include such Holder as a selling shareholder in a distribution under the Shelf
Registration Statement.
(c) Sole Methods of Distribution. The sole methods of distribution
under the Shelf Registration Statement shall be either (i) an Underwritten
Offering, requested in accordance with Section 3, (ii) a Block Trade, requested
in accordance with Section 4, or (iii) an Underwritten Ofering requested in
accordance with Section 5(a)(iv); provided, however, that in no event shall the
total number of Underwritten Offerings and Block Trades under the Shelf
Registration Statement pursuant to Section 3 and Section 4 exceed three (3) in
the aggregate; and provided further that no Unrestricted Securities may be sold
in a Block Trade under the Shelf Registration Statement.
Subject to Section 7(a), nothing in this Agreement shall in any way
restrict any Holder from selling or otherwise transferring the risk or benefit
of ownership of securities of the Company in any manner not provided in this
Agreement, including any sale of Common Shares purchased by Westar in the open
market.
SECTION 3. UNDERWRITTEN OFFERINGS.
(a) Request. Upon the written request of a Holder or Holders, the
Company shall facilitate an Underwritten Offering under the Shelf Registration
Statement in accordance with the provisions of this Agreement; provided,
however, that the Company shall not be obligated to facilitate any Underwritten
Offering for less than 500,000 Common Shares (or their equivalent). The number
of shares in the preceding proviso shall be appropriately adjusted for any stock
dividend, stock split, reverse stock split, combination, recapitalization,
reclassification, exchange or similar transaction with respect to the Common
Shares.
(b) Notice of Request; Procedures. At least ten (10) Business Days
prior to the time that any Holder or Holders propose to effect an Underwritten
Offering, such Holders shall deliver to the Company a written notice setting
forth the proposed timing of such Underwritten Offering, the number of
Registrable Securities to be offered and any other material
- 4 -
<PAGE>
information of the Holders relevant to the proposed Underwritten Offering,
including information reasonably necessary for the preparation of any required
supplement to the Prospectus. Thereafter, the Company shall, as soon as
reasonably practicable but in any event in sufficient time for effecting the
proposed Underwritten Offering, prepare any required supplement to the
Prospectus and perform any other procedures required to be performed by the
Company under this Agreement that are necessary to effect the proposed
Underwritten Offering.
(c) Road Show. The Company will use its reasonable best efforts to
cooperate in a marketing effort in respect of any Underwritten Offering,
including participation in a "road show" with appropriate senior management, to
assist the Holders in selling Registrable Securities in such Underwritten
Offering.
(d) Revocation of Request. A Holder or Holders requesting an
Underwritten Offering pursuant to this Section 3 may, at any time prior to the
consummation of such Underwritten Offering, revoke such request by providing
written notice of revocation to the Company; provided, however, that the Holder
or Holders revoking any request for an Underwritten Offering, at their option,
shall either pay all reasonable expenses (not to exceed $500,000) of the Company
incurred with respect to such revoked request in accordance with Section 8 or
such revoked request shall be deemed a consummated Underwritten Offering for
purposes of Section 2(c).
Section 4. BLOCK TRADE. (a) Notice. At least three (3) Business Days
before any Holder or Holders propose to effect a Block Trade (two (2) Business
Days if the Holders do not require delivery of the documentation set forth in
clause (xii) of Section 6(a)), such Holders shall deliver to the Company a
written notice setting forth the proposed timing of such Block Trade, stating
the number of the securities to be sold and including any other material
information of the Holders relevant to the proposed Block Trade, including
information reasonably necessary for the preparation of any required supplement
to the Prospectus. Thereafter, the Company shall, as soon as reasonably
practicable but in any event in sufficient time for effecting the proposed Block
Trade, prepare any required supplement to the Prospectus and perform any other
procedures required to be performed by the Company under this Agreement that are
necessary to effect the proposed Block Trade.
(b) Revocation. A Holder or Holders requesting a Block Trade pursuant
to this Section 4 may, at any time prior to the consummation of such Block
Trade, revoke such request by providing written notice of revocation to the
Company; provided, however, that the Holder or Holders revoking any request for
an Underwritten Offering, at their option, shall either pay all reasonable
expenses (not to exceed $25,000) of the Company incurred with respect to such
revoked request in accordance with Section 8 or such revoked request shall be
deemed a consummated Block Trade for purposes of Section 2(c).
- 5 -
<PAGE>
SECTION 5. PIGGYBACK REGISTRATION.
(a) Mutual Piggyback Registration.
(i) Applicability. The provisions of this Section 5(a) shall apply from
and after the end of the Exclusive Period.
(ii) Company Piggyback Right. If a Holder or Holders deliver a notice
of a proposed Underwritten Offering in accordance with Section 3(b), the Company
may elect to participate in the sale of Common Shares in such Underwritten
Offering. Such election shall be made by written notice of the Company delivered
to the Holders within five (5) Business Days of the Company's receipt of the
notice of the Holders in respect of the Underwritten Offering, which notice
shall specify the number of Common Shares that the Company proposes to sell in
the Underwritten Offering. If the Company elects to participate in the
Underwritten Offering, the Company shall promptly file an amendment to the Shelf
Registration Statement or shall file a new Registration Statement, as required
under the Securities Act in order to permit the Company to sell Common Shares in
the Underwritten Offering. The Underwritten Offering shall thereafter be
consummated as soon as practicable after the earlier to occur of (x) the time
the required amendment to the Shelf Registration Statement or new Registration
Statement shall become effective under the Securities Act, provided that the
Company shall use its reasonable best efforts to cause such amendment or
Registration Statement to become effective as soon as practicable, and (y)
thirty (30) calendar days from the date of delivery by the Company to the
Holders of the notice of the Company's election to participate in the proposed
Underwritten Offering of the Holders.
(iii) Holder Piggyback on Company Registration Statement. If the
Company at any time proposes to file a registration statement with respect to
the Underwritten Offering of Common Shares for its own account, then the Company
shall in each case give written notice of such proposed filing to the Holders at
least ten (10) Business Days before the anticipated filing date of any such
registration statement by the Company, and such notice shall offer to all
Holders the opportunity to have any or all of the Registrable Securities held by
such Holders included in such registration statement. Each Holder desiring to
have its Registrable Securities registered under this Section 5(a)(iii) shall so
advise the Company in writing within five (5) Business Days after the date of
receipt of the Company's aforesaid notice (which request shall set forth the
amount of Registrable Securities for which registration is requested), and the
Company shall include in such Registration Statement all such Registrable
Securities so requested to be included therein. If any such registration is not
a Shelf Registration, such Registrable Securities shall be offered in the
Underwritten Offering together with the offering of Common Shares by the Company
with respect to which such Registration Statement has been filed. If any such
registration is a Shelf Registration, such Registrable Securities shall be
included in the Registration Statement only for distribution in an Underwritten
Offering together with an Underwritten Offering of Common Shares by the Company.
(iv) Holder Participation in a Company Underwritten Offering. If the
Company at any time proposes to effect an Underwritten Offering of Common Shares
for its
- 6 -
<PAGE>
own account under a previously effective Registration Statement, then the
Company shall in each case give written notice of such proposed offering to the
Holders at least ten (10) Business Days before the anticipated date of such
Underwritten Offering, and such notice shall offer to all Holders the
opportunity to have any or all of the Registrable Securities then held by the
Holders included in such Underwritten Offering, to the extent such Registrable
Securities have previously been registered either under the Shelf Registration
Statement or a Registration Statement filed pursuant to Section 5(a)(iii) above.
Each Holder desiring to have its Registrable Securities offered under this
Section 5(a)(iv) shall so advise the Company in writing within five (5) Business
Days after the date of receipt of the Company's aforesaid notice (which request
shall set forth the amount of Registrable Securities proposed to be offered),
and the Company shall cause to be included in such Underwritten Offering all
such Registrable Securities so requested to be included therein.
(v) Cutback. Notwithstanding the foregoing provisions of this Section
5(a), if the managing underwriter or underwriters of any Underwritten Offering
referred to in this Section 5(a) have advised the Company in writing that the
total amount of Common Shares of the Holders, the Company and any other Persons
intended to be included in such Underwritten Offering is sufficiently large to
materially adversely affect the success of such offering, then the amount of
Common Shares to be offered in such public offering shall be allocated as
follows:
(i) first, to the Company, in the amount the Company proposes to
offer, up to an amount equal to one-half of the maximum amount (the
"Maximum Amount") of Common Shares that the managing underwriter or
underwriters have advised can be sold in the Underwritten Offering;
(ii) next, to the Holders, in the amount the Holders propose to
offer, up to an amount equal to one-half of the Maximum Amount;
(iii) next, if the sum of the Common Shares allocated pursuant to
clauses (i) and (ii) above is less than the Maximum Amount, to the
Company or the Holders, whichever shall have Common Shares proposed to
be offered in the Underwritten Offering which have not been allocated
under clauses (i) or (ii) above, up to an amount equal to the
difference between the Maximum Amount and the amount of Common Shares
allocated under clauses (i) and (ii) above; and
(iv) thereafter, if the sum of the Common Shares allocated
pursuant to clauses (i), (ii) and (iii) above is less than the Maximum
Amount, to any other Person entitled to participate in the
Underwritten Offering, up to an amount equal to the difference between
the Maximum Amount and the amount of Common Shares allocated under
clauses (i), (ii) and (iii) above.
(b) Third Party Registration Statement.
(i) Notice and Participation. If the Company at any time proposes
to file a registration statement with respect to the Underwritten
Offering of any class of its equity
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securities for the account of a holder of securities of the Company pursuant to
registration rights granted by the Company (a "Requesting Shareholder"), then
the Company shall in each case give written notice of such proposed filing to
the Holders at least ten (10) Business Days before the anticipated filing date
of any such registration statement by the Company, and such notice shall offer
to all Holders the opportunity to have any or all of the Registrable Securities
held by such Holders included in such registration statement; provided, however,
that if any such registration is a Shelf Registration, Registrable Securities
shall be included therein only for distribution in an Underwritten Offering.
Each Holder desiring to have its Registrable Securities registered under this
Section 5 shall so advise the Company in writing within five (5) Business Days
after the date of receipt of the Company's aforesaid notice (which request shall
set forth the amount of Registrable Securities for which registration is
requested), and the Company shall include in such Registration Statement all
such Registrable Securities so requested to be included therein.
(ii) Cutback. Notwithstanding the foregoing provisions of this Section
5(b), if the managing underwriter or underwriters of any such Underwritten
Offering have advised the Company in writing that the total amount or kind of
securities of the Holders, the Company and any other Persons intended to be
included in such Underwritten Offering is sufficiently large to materially
adversely affect the success of such offering, then the amount or kind of
securities to be offered for the accounts of Holders shall be reduced pro rata,
together with the amount or kind of securities to be offered for the accounts of
any other Persons requesting registration of securities pursuant to rights
similar to the rights of Holders under this Section 5(b), to the extent
necessary to reduce the total amount or kind of securities to be included in
such proposed public offering to the amount or kind recommended by such managing
underwriter or underwriters before the securities offered by the Company or any
Requesting Shareholder are so reduced.
SECTION 6. REGISTRATION PROCEDURES.
(a) General. In connection with the Company's registration obligations
pursuant to Section 2 hereof, the Company will:
(i) prepare and file with the SEC a Registration Statement or
such amendments and post-effective amendments to an existing
Registration Statement as may be necessary to keep such Registration
Statement effective for the time period set forth in Section 2(a),
provided that as soon as practicable, but in no event later than three
(3) Business Days before filing such Registration Statement, any
related Prospectus or any amendment or supplement thereto, other than
any amendment or supplement made solely as a result of incorporation
by reference of documents filed with the SEC subsequent to the filing
of such Registration Statement, the Company shall furnish to the
Holders of the Registrable Securities covered by such Registration
Statement and the underwriters, if any, copies of all such documents
proposed to be filed, which documents shall be subject to the review
of such Holders and underwriters; not file any Registration Statement
or amendment thereto or any Prospectus or any supplement thereto
(other than any amendment or supplement made solely as a result of
incorporation by reference of documents filed with the SEC subsequent
to the filing of such Registration Statement) to which the managing
underwriters of the applicable offering, if any, or the Holders
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covered by such Registration Statement shall have reasonably objected
in writing within two (2) Business Days after receipt of such documents
to the effect that such Registration Statement or amendment thereto or
Prospectus or supplement thereto does not comply in all material
respects with the requirements of the Securities Act; and comply with
the provisions of the Securities Act applicable to the Company with
respect to the disposition of all securities covered by such
Registration Statement during the applicable period in accordance with
the intended method or methods of distribution by the sellers thereof
set forth in such Registration Statement or supplement to the
Prospectus in accordance with this Agreement;
(ii) notify the selling Holders of Registrable Securities and the
managing underwriters, if any, promptly (1) when a Registration
Statement, Prospectus or any Prospectus supplement or post-effective
amendment has been filed, and, with respect to any Registration
Statement or post-effective amendment, when it has become effective,
(2) of any request by the SEC for amendments or supplements to any
Registration Statement or Prospectus or for additional information,
(3) of the issuance by the SEC of any comments with respect to any
filing, (4) of any stop order suspending the effectiveness of any
Registration Statement or the initiation of any proceedings for that
purpose, (5) in the case of an Underwritten Offering, if at any time
the representations and warranties of the Company contemplated by
paragraph (xi) below cease to be true and correct as of any time they
are required to be true and correct, (6) of any suspension of the
qualification of the Registrable Securities for sale in any
jurisdiction or the initiation or threatening of any proceeding for
such purpose and (7) of the happening of any event which makes any
statement of a material fact made in any Registration Statement,
Prospectus or any document incorporated therein by reference untrue or
which requires the making of any changes in any Registration
Statement, Prospectus or any document incorporated therein by
reference in order to make the statements therein (in the case of any
Prospectus, in the light of the circumstances under which they were
made) not misleading; and use reasonable best efforts to obtain as
promptly as practicable the withdrawal of any order or other action
suspending the effectiveness of any Registration Statement or
suspending the qualification or registration (or exemption therefrom)
of the Registrable Securities for sale in any jurisdiction;
(iii) if reasonably requested by the managing underwriter or
underwriters or the Holders of Registrable Securities being sold in
connection with an Underwritten Offering, promptly incorporate in a
Prospectus supplement or post-effective amendment such information as
the managing underwriters and the Holders of the Registrable
Securities being sold in such Underwritten Offering agree should be
included therein relating to the sale of the Registrable Securities,
including, without limitation, information with respect to the
aggregate number of shares of Registrable Securities being sold to
such underwriters, the purchase price being paid therefor by such
underwriters and with respect to any other terms of the Underwritten
Offering of the Registrable Securities to be sold in such offering;
and promptly make all required filings of such Prospectus supplement
or post-effective amendment;
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(iv) promptly after the filing of any document which is to be
incorporated by reference into a Registration Statement or Prospectus,
provide without charge copies of such document to the Holders of the
Registrable Securities covered thereby and the underwriters, if any;
(v) furnish to the selling Holders of Registrable Securities and
each managing underwriter, without charge, at least one manually
signed or "edgarized" copy, and as many conformed copies as may
reasonably be requested, of the then effective Registration Statement
and any post-effective amendments thereto, including financial
statements and schedules, all documents incorporated therein by
reference and all exhibits (including those incorporated by
reference);
(vi) deliver to the selling Holders and the underwriters, if any,
without charge, as many copies of the then effective Prospectus
(including each prospectus subject to completion) and any amendments
or supplements thereto as such Persons may reasonably request;
(vii) use reasonable best efforts to register or qualify or
cooperate with the selling Holders, the underwriters, if any, and
their respective counsel in connection with the registration or
qualification of such Registrable Securities for offer and sale under
the securities or blue sky laws of such jurisdictions as any selling
Holder or underwriter reasonably requests in writing and do any and
all other acts or things reasonably necessary or advisable to enable
the disposition in such jurisdictions of the Registrable Securities
covered by the then effective Registration Statement; provided,
however, that the Company will not be required to (1) qualify to do
business in any jurisdiction where it would not otherwise be required
to qualify but for this paragraph (vii) or (2) subject itself to
general taxation in any such jurisdiction;
(viii) cooperate with the selling Holders and the managing
underwriters, if any, to facilitate the timely preparation and
delivery of certificates representing Registrable Securities to be
sold and not bearing any restrictive legends; and enable such
Registrable Securities to be in such denominations and registered in
such names as the managing underwriters may request at least two (2)
Business Days prior to any sale of Registrable Securities to the
underwriters;
(ix) upon the occurrence of any event contemplated by clause (7)
of paragraph (ii) above, promptly prepare a supplement or
post-effective amendment to the Registration Statement or the related
Prospectus or any document incorporated therein by reference or file
any other required document so that, as thereafter delivered to the
purchasers of the Registrable Securities, the Prospectus will not
contain an untrue statement of a material fact or omit to state any
material fact necessary to make the statements therein, in the light
of the circumstances in which they were made, not misleading;
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(x) cause all Registrable Securities covered by the Registration
Statement to be listed on each securities exchange (or quotation
system operated by a national securities association) on which
identical securities issued by the Company are then listed, and enter
into customary agreements including, if necessary, a listing
application and indemnification agreement in customary form, and
provide a transfer agent for such Registrable Securities;
(xi) in the case of an Underwritten Offering, enter into an
underwriting agreement and take all such other actions in connection
therewith in order to expedite and facilitate the disposition of such
Registrable Securities, in each case as the underwriters determine is
reasonable and customary in transactions of this kind, and in
connection therewith: (1) make such representations and warranties to
the Holders of such Registrable Securities and the underwriters in
form, substance and scope as are customarily made by issuers to
underwriters in secondary underwritten offerings; (2) obtain opinions
of counsel to the Company (which counsel and opinions (in form, scope
and substance) shall be reasonably satisfactory to the underwriters
and the selling Holders of such Registrable Securities and shall cover
the matters customarily covered in opinions requested in secondary
underwritten offerings and such other matters as may be reasonably
requested by such Holders and underwriters); (3) obtain "cold comfort"
letters from the independent public accountants of the Company
addressed to the selling Holders of such Registrable Securities and
the underwriters, such letters to be in customary form and covering
matters of the type customarily covered in "cold comfort" letters in
connection with secondary underwritten offerings; and (4) deliver such
documents and certificates as may be reasonably requested by the
selling Holders and the managing underwriters to evidence compliance
with clause (1) above and with any customary conditions contained in
the underwriting agreement or other agreement entered into by the
Company in respect of the relevant offering;
(xii) in the case of a Block Trade: (1) obtain an opinion of
counsel addressed to the selling Holders covering matters that are no
more extensive in scope than would be customarily covered in opinions
obtained in secondary underwritten offerings by issuers with similar
market capitalization and reporting and financial histories; (2)
obtain a "cold comfort" letter from the independent public accountants
of the Company and covering matters that are no more extensive in
scope than would be customarily covered in "cold comfort" letters and
updates obtained in secondary underwritten offerings by issuers with
similar market capitalization and reporting and financial histories,
provided that the letter described in this clause (2) shall only be
required to the extent such letters are being issued in respect of
nonunderwritten secondary offerings under then prevailing accounting
practices; and (3) deliver a certificate of a senior executive officer
of the Company to cover matters no more extensive in scope than those
matters customarily covered in officer's certificates delivered in
connection with underwritten offerings by issuers with similar market
capitalization and reporting and financial histories;
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(xiii) provide a CUSIP number for the Registrable Securities no
later than the effective date of such registration statement;
(xiv) otherwise use its best efforts to comply with all
applicable rules and regulations of the SEC relating to such
registration and the distribution of the securities being offered and
make generally available to its securities holders earnings statements
satisfying the provisions of Section 11(a) of the Securities Act, no
later than 60 days after the end of any 12-month period (or 90 days,
if such period is a fiscal year) commencing at the end of any fiscal
quarter in which the Registrable Securities are sold in an
Underwritten Offering or Block Trade, which earnings statements shall
cover such 12- month periods;
(xv) cooperate and assist in any filings required to be made with
the National Association of Securities Dealers, Inc.; and
(xvi) make available for inspection by representatives of the
Holders of the Registrable Securities covered by such Registration
Statement, any underwriters participating in any disposition pursuant
to such registration, and any attorneys or accountants retained by the
selling Holders or the underwriters, all financial and other records,
pertinent corporate documents and properties of the Company and cause
the Company's officers, directors and employees to supply all
information reasonably requested by, and to cooperate fully with, any
such representative, underwriter, attorney or accountant in connection
with such registration, and otherwise to cooperate fully in connection
with any due diligence investigation, including making available its
officers during ordinary business hours, and permitting discussions
with the independent public accountants who have certified the
Company's most recent annual financial statements, in each case to the
extent necessary to enable any Holder or underwriter to conduct a
"reasonable investigation" for purposes of Section 11(a) of the
Securities Act; provided that such representatives, underwriters,
attorneys or accountants enter into a confidentiality agreement, in
customary form and substance reasonably satisfactory to the Company,
prior to the release or disclosure to them of any such information,
records or documents.
(b) Holder Information. The Company may require each selling Holder to
furnish to the Company such information regarding such Holder and the
distribution of Registrable Securities to be sold by such Holder as the Company
may from time to time reasonably request in writing.
(c) Occurrence of Certain Events. Each Holder of Registrable Securities
agrees that, upon receipt of any notice from the Company of the happening of any
event of the kind described in Section 6(a)(ii)(4), (6) or (7), such Holder will
forthwith refrain from disposing or discontinue disposition of Registrable
Securities pursuant to the then current Prospectus until such Holder is advised
in writing by the Company that the use of the Prospectus may be resumed. The
Company shall use its best efforts to limit the duration of any discontinuance
with respect to the disposition of Registrable Securities pursuant to this
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paragraph. If the Company shall deliver any notice in accordance with this
Section 6(c), the Company shall extend the period during which the Shelf
Registration Statement is required to be effective pursuant to clause (i) of
Section 2(a) by the number of days during which the disposition of Registrable
Securities is prohibited pursuant to this Section 6(c).
(d) Additional Procedures. If the Holders become entitled, pursuant to
an event described in clause (ii) of the definition of Registrable Securities,
to receive any securities in respect of Registrable Securities that were already
included in the Shelf Registration Statement subsequent to the date the Shelf
Registration Statement is declared effective, and the Company is unable under
the securities laws to add such securities to the Shelf Registration Statement,
the Company, as promptly as reasonably practicable, shall file, in accordance
with the procedures more particularly set forth in Section 6(a), an additional
Shelf Registration Statement with respect to any such Registrable Securities.
The Company shall use its best efforts to have any such additional Registration
Statement declared effective as promptly as reasonably practicable after such
filing and to keep such additional Shelf Registration Statement continuously
effective during the period specified in Section 2(a).
SECTION 7. HOLDBACK AGREEMENTS.
(a) Hold-Back Election. Subject to Section 7(c) and the final two
sentences of this Section 7(a), in the case of any Underwritten Offering by the
Company, whether for its own account or for the account of a holder of
securities of the Company pursuant to registration rights granted by the
Company, each Holder agrees, if and to the extent requested in writing by the
managing underwriter or underwriters administering such offering as promptly as
reasonably practicable prior to the commencement of the 7-day period referred to
below (a "Hold-Back Election"), not to effect any public sale or distribution of
securities of the Company except as part of such Underwritten Offering, during
the period beginning seven (7) days prior to the closing date of such
underwritten offering and during the period ending on the earlier of (i)
forty-five (45) days after such closing date and (ii) the date such sale or
distribution is permitted by such managing underwriter or underwriters, provided
that, if and to the extent it is reasonable to do so, the Company will request
of the managing underwriter or underwriters to permit such sale or distribution
prior to the date permitted under clause (i) above. Notwithstanding the
foregoing provisions of this Section 7(a), no Holder shall be obligated to
refrain from making any public sale or distribution of securities of the Company
in the case of any underwritten secondary offering initiated at the request of
any Person who has not agreed in writing to expressly recognize and give effect
to the Holders' rights under Section 7(d) and to be subject to provisions that
are at least as favorable to the Holders as the provisions contained in this
Section 7(a) are to such holder. No Hold-Back Election shall be invoked or be
effective until after the end of the Exclusive Period. This Section 7(a) shall
cease to be of any effect following the time that Western and its subsidiaries
hold, in the aggregate, less than three percent (3%) of the outstanding Common
Shares.
(b) Material Development Election. Subject to Section 7(c), the Company
shall be entitled, for a period of time not to exceed thirty (30) consecutive
days, to require that the Holders refrain from effecting any distribution of
their Registrable Securities pursuant to the
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Shelf Registration Statement if the chief executive officer of the Company
determines in his reasonable good faith judgment that, in accordance with his
understanding of the disclosure requirements of applicable securities law, such
distribution would require disclosure of any financing (other than an
underwritten secondary offering of any securities of the Company), acquisition,
corporate reorganization or other transaction or development involving the
Company or any subsidiary of the Company that is or would be material to the
Company and that, in the reasonable good faith business judgment of such chief
executive officer, such disclosure would not at that time be in the best
interests of the Company (a "Material Development Election"). The Company shall,
as promptly as practicable, give the Holders written notice of any such Material
Development Election. If the Holders have been required to refrain from
disposing of their Registrable Securities as a result of a Material Development
Election, the Company shall, as promptly as practicable following the
determination that the Holders may recommence such sales, notify such Holders in
writing of such determination (but in any event no later than the end of such
30-day period).
(c) Limitation. In no event shall the restrictions under Section 7(a)
or Section 7(b), pursuant to one or more Hold-Back Elections or Material
Development Elections, remain in effect for more than seventy-five (75) days in
the aggregate in any calendar year; provided that the restrictions under Section
7(b) pursuant to two or more Material Development Elections shall not remain in
effect for more than forty-five (45) days in the aggregate in calendar year
1997. In addition, if any Hold-Back Election or Material Development Election
shall be exercised, the period during which the Shelf Registration Statement is
required to be effective pursuant to clause (i) of Section 2(a) shall be
extended by the number of days during which the disposition of Registrable
Securities is prohibited pursuant to such elections.
(d) Company Hold-Back. In the case of any Underwritten Offering of
Registrable Securities pursuant to Section 3, the Company agrees, if and to the
extent requested in writing by the managing underwriter or underwriters
administering such offering, as promptly as reasonably practicable prior to the
commencement of the 7-day period referred to below, not to effect any public
sale or distribution (other than sales pursuant to the same Registration
Statement, as permitted under this Agreement and other than any registration on
Form S-8 or S-4 (or any successor or substantially similar form) or of (A) an
employee stock option, stock purchase or compensation plan or of securities
issued or issuable pursuant to any such plan, (B) securities proposed to be
issued in exchange for securities or assets of, or in connection with a merger,
combination or consolidation with, another corporation, or (C) a dividend
reinvestment plan) of any securities of the Company during the period beginning
seven (7) days prior to the closing date of each underwritten offering of
Registrable Securities and during the period ending on the earlier of (i)
forty-five (45) days after such closing date and (ii) the date such sale or
distribution is permitted by such managing underwriter or underwriters; provided
that, if and to the extent it is reasonable to do so, the Holders will request
of the managing underwriter or underwriters to permit such sale or distribution
prior to the date permitted under clause (i) above. Any agreement entered into
after the date of this Agreement pursuant to which the Company issues or agrees
to issue any privately placed securities similar to the Registrable Securities
shall contain a provision under which any holder of such securities agrees not
to effect any public sale or distribution of any such securities during the
period described in the preceding
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sentence, unless such holder, together with its affiliates, holds less than
three percent (3%) of the outstanding Common Shares.
(e) Exclusive Period. The Company shall not effect any Underwritten
Offering of Common Shares during the Exclusive Period, other than (x) an
Underwritten Offering of Registrable Securities and (y) an Underwritten Offering
of Common Shares for the benefit of a shareholder in satisfaction of
registration rights granted by the Company to such shareholder prior to the date
of this Agreement, as listed on Appendix I to this Agreement.
SECTION 8. REGISTRATION EXPENSES. (a) General. Except as otherwise set
forth in this section, each of the Company, on the one hand, and the Holders, on
the other, will bear it own costs in connection with this Agreement, including
without limitation, internal expenses (including, without limitation, all
salaries and expenses of its officers and employees), fees and disbursements of
its outside counsel and its independent public accountants and fees and expenses
of any other experts or advisors.
(b) Company Expenses. The Company shall pay all printing expenses
(including expenses of printing and disseminating Prospectuses or any other
necessary documentation). The Company shall also pay all registration and filing
fees and fees and expenses of compliance with state securities or blue sky laws,
including reasonable fees and disbursements of counsel in connection with blue
sky qualifications or registrations (or the obtaining of exemptions therefrom),
in respect of Common Shares sold by the Company in any Underwritten Offering,
including pursuant to Section 5(a)(ii).
(c) Holder Expenses. The Holders shall pay all registration and filing
fees and fees and expenses of compliance with state securities or blue sky laws,
including reasonable fees and disbursements of counsel in connection with blue
sky qualifications or registrations (or the obtaining of exemptions therefrom),
in respect of the Registrable Securities. The Holders shall also pay all
expenses incurred by the Company in connection with the participation in any
"road show" of members of the Company's management up to $100,000.
SECTION 9. INDEMNIFICATION.
(a) Indemnification by the Company. The Company agrees to indemnify and
hold harmless, to the full extent permitted by law, but without duplication,
each Holder, its officers, directors, employees, partners, principals, equity
holders, managed or advised accounts, advisors and agents, and each Person who
controls such Holder (within the meaning of the Securities Act), against all
losses, claims, damages, liabilities, expenses, actions and proceedings
(including reasonable costs of investigation and reasonable legal fees and
expenses) that arise out of or are based upon any untrue statement or alleged
untrue statement of a material fact contained in, or any omission or alleged
omission of a material fact required to be contained in, any Registration
Statement or Prospectus or necessary to make the statements therein (in the case
of a Prospectus in light of the circumstances under which they were made) not
misleading, except insofar as the same are caused by or contained in any
information furnished in writing
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to the Company by any Holder or any underwriters expressly for use therein. The
Company will also indemnify underwriters participating in the distribution,
their officers, directors, employees, partners and agents, and each Person who
controls such underwriters (within the meaning of the Securities Act), to the
same extent as provided above with respect to the indemnification of the Holders
of Registrable Securities, if so requested.
(b) Indemnification by Holders of Registrable Securities. In connection
with any Registration Statement in which a Holder of Registrable Securities is
participating, each such Holder will furnish to the Company in writing such
information and affidavits as the Company reasonably requests for use in
connection with any such Registration Statement or Prospectus and agrees to
indemnify and hold harmless, to the full extent permitted by law, but without
duplication, the Company, its officers, directors, shareholders, employees,
advisors and agents, and each Person who controls the Company (within the
meaning of the Securities Act) against any losses, claims, damages, liabilities,
expenses actions and proceedings (including reasonable costs of investigation
and reasonable legal fees and expenses) that arise out of or are based upon any
untrue statement or alleged untrue statement of a material fact contained in, or
any omission or alleged omission of a material fact required to be contained in,
the Registration Statement or Prospectus, or necessary to make the statements
therein (in the case of a Prospectus in light of the circumstances under which
they were made) not misleading, to the extent, but only to the extent, that such
untrue statement or omission is contained in any information or affidavit so
furnished in writing by such Holder to the Company specifically for inclusion
therein. The Company and the other persons described above shall be entitled to
receive indemnities from underwriters participating in the distribution, to the
same extent as provided above with respect to information so furnished in
writing by such Persons specifically for inclusion in any Prospectus or
Registration Statement.
(c) Conduct of Indemnification Proceedings. Any Person entitled to
indemnification hereunder will (i) give prompt notice to the indemnifying party
of any claim with respect to which it seeks indemnification and (ii) permit such
indemnifying party to assume the defense of such claim with counsel reasonably
satisfactory to the indemnified party; provided, however, that any Person
entitled to indemnification hereunder shall have the right to employ separate
counsel and to participate in the defense of such claim, but the fees and
expenses of such counsel shall be at the expense of such indemnified Person
unless (A) the indemnifying party has agreed to pay such fees or expenses, (B)
the indemnifying party shall have failed to assume the defense of such claim and
employ counsel reasonably satisfactory to the indemnified party in a timely
manner or (C) in the reasonable judgment of any such Person, based upon advice
of its counsel, a conflict of interest may exist between such person and the
indemnifying party with respect to such claims (in which case, if the Person
notifies the indemnifying party in writing that such Person elects to employ
separate counsel at the expense of the indemnifying party, the indemnifying
party shall not have the right to assume the defense of such claim on behalf of
such person). The indemnifying party will not be subject to any liability for
any settlement made without its consent (but such consent will not be
unreasonably withheld). No indemnified party will be required to consent to
entry of any judgment or enter into any settlement which does not include as an
unconditional term thereof the giving by the claimant or plaintiff to such
indemnified party of a release from all liability in respect of such claim or
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litigation. An indemnifying party who is not entitled to, or elects not to,
assume the defense of the claim will not be obligated to pay the fees and
expenses of more than one counsel for all parties indemnified by such
indemnifying party with respect to such claim, as well as one local counsel in
each relevant jurisdiction.
(d) Contribution. If for any reason the indemnification provided for in
Section 9(a) or Section 9(b) is unavailable to an indemnified party or
insufficient to hold it harmless as contemplated by Section 9(a) and Section
9(b), then the indemnifying party shall contribute to the amount paid or payable
by the indemnified party as a result of such loss, claim, damage or liability in
such proportion as is appropriate to reflect not only the relative benefits
received by the indemnifying party and the indemnified party, but also the
relative fault of the indemnifying party and the indemnified party, as well as
any other relevant equitable considerations, provided, that no indemnifying
Holder shall be required to contribute an amount greater than the dollar amount
of the net proceeds received by such indemnifying Holder with respect to the
sale of the Registrable Securities giving rise to such indemnification
obligation. The relative fault of any indemnifying or of any indemnified party
shall be determined by reference to, among other things, whether the untrue or
alleged untrue statement of a material fact or omission or alleged omission to
state a material fact relates to information supplied by such indemnifying or
indemnified party or its affiliates or representatives, and the parties'
relative intent, knowledge, access to information and opportunity to correct or
prevent such statement or omission. The parties hereto agree that it would not
be just and equitable if contribution pursuant to this Section 9(d) were
determined by (i) pro rata allocation (even if all Holders or any agents for the
Holders or any underwriters of the Registered Securities, or all of them, were
treated as one entity for such purpose), or (ii) by any other method that does
not take into account the equitable consideration referred to in this Section
9(d). The amount paid or payable by an indemnified party as a result of the
losses, claims, damages or liabilities (or actions or proceedings in respect
thereof) referred to above shall be deemed to include any legal or other fees or
expenses reasonably incurred by such indemnified party in connection with
investigating or defending any such action, proceeding or claim. No Person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the Securities Act) shall be entitled to contribution from any Person who was
not guilty of such fraudulent misrepresentations.
SECTION 10. UNDERWRITERS.
(a) Selection of Underwriters under Shelf Registration Statement. Each
underwriter for any Underwritten Offering under the Shelf Registration Statement
shall be mutually acceptable to the Company and the Holders. The Company shall
have no right to select or approve any investment banking firm to act on behalf
of the Holders in respect of any Block Trade.
(b) Selection of Underwriters on Certain Piggyback Offerings. The
Company will consult in good faith with the Holders regarding the selection of
underwriters in any Underwritten Offering of the Company in which the Holders
participate in accordance with the provisions of Section 5(a)(iii) or Section
5(a)(iv), provided that the selection of underwriters for such offering shall be
as determined by the Company.
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(c) Approved Underwriting Arrangements. No Holder may participate in
any Underwritten Offering of Registrable Securities hereunder, unless such
Holder (i) agrees to sell such Holder's Registrable Securities on the basis
provided in any underwriting arrangements approved by the managing underwriters
for the Underwritten Offering, and (ii) completes and executes all
questionnaires, powers of attorney, indemnities, underwriting agreements and
other documents required under the terms of such underwriting arrangements.
Nothing in this Section 10 shall be construed to create any additional rights
regarding the registration of Registrable Securities in any Person otherwise
than as set forth herein.
SECTION 11. NO INCONSISTENT AGREEMENTS. The Company has not previously
and shall not in the future enter into any agreement, arrangement or
understanding with respect to its securities which is inconsistent with the
rights granted to the Holders of Registrable Securities in this Agreement or
otherwise conflicts with the provisions hereof.
SECTION 12. AMENDMENTS AND WAIVERS. The provisions of this Agreement,
including the provisions of this Section 12, may not be amended, modified or
supplemented, and waivers or consents to departures from the provisions hereof
may not be given, without the consent in writing of the Company and the Holders.
SECTION 13. REMEDIES. Any Person having rights under any provision of
this Agreement shall be entitled to enforce such rights specifically or to
recover damages or to exercise any other remedy available to it at law or in
equity. The foregoing rights and remedies shall be cumulative and the exercise
of any right or remedy provided herein shall not preclude any Person from
exercising any other right or remedy provided herein. Each of the Company and
the Holders agree that monetary damages would not be adequate compensation for
any loss incurred by reason of a breach by it of any of the provisions of this
Agreement and hereby agrees to waive the defense in any action for specific
performance that a remedy at law would be adequate.
SECTION 14. NOTICES; DESIGNATED HOLDER. (a) Delivery. All notices,
documents and other communications required or permitted to be delivered
hereunder shall, in the case of notices and communications, be in writing and
shall be delivered by hand-delivery, registered first-class mail, telecopier, or
air-courier guaranteeing overnight delivery:
(i) If to the Holders, or any of them, to the Designated Holder,
c/o Western Resources, Inc., 818 Kansas Avenue, Topeka, Kansas 66612,
attention John K. Rosenberg, Esq., telecopier number (913) 575-1788,
confirm number (913) 575-6535, with a copy to Sullivan & Cromwell, 125
Broad Street, New York, New York 10004, attention Neil T. Anderson,
Esq., telecopier number (212) 558-3588, confirmation number (212)
558-4000;
(ii) If to the Company, Tyco International Ltd., Cedar House, 41
Cedar Avenue, Hamilton HM12, Bermuda, telecopier number (441)
292-8666, confirm number (441) 295-2244; with a copy to Kramer, Levin,
Naftalis & Frankel, 919 Third Avenue,
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<PAGE>
New York, New York 10022, attention Abbe L. Dienstag, Esq., telecopier
number (212) 715-8000, confirmation number (212) 715-9100; or
(iii) At such other address as may be designated from time to
time by notice given in accordance with the provisions of this Section
14.
(b) Receipt. All such notices and other communications shall be deemed
to have been delivered and received (x) in the case of personal delivery,
telecopier or telegram, on the date of such delivery, (y) in the case of air
courier, on the Business Day after the date when sent and (z) in the case of
mailing, on the third Business Day following such mailing.
(c) Designated Holder. Any action required or permitted to be taken by
the Holders pursuant to this Agreement, including delivery of any notice to the
Company hereunder, shall be taken by the Designated Holder on behalf of one or
more Holders or all of the Holders, as the case may be, and the Company shall
not be required to take any action or refrain from taking any action under this
Agreement on the basis of any notice of a Holder other than the Designated
Holder; provided, however, that nothing in this Section shall relieve any Holder
from any of it obligations or liabilities under this Agreement.
SECTION 15. SUCCESSORS AND ASSIGNS. This Agreement shall inure to the
benefit of and be binding upon the successors and permitted assigns of each of
the parties hereto. No party may assign its rights or obligations under this
Agreement to any other Person, except that any Holder may assign its rights
hereunder to any other Holder.
SECTION 16. COUNTERPARTS. This Agreement may be executed in any number
of counterparts and by the parties hereto in separate counterparts, each of
which when so executed shall be deemed to be an original and all of which taken
together shall constitute one and the same agreement.
SECTION 17. HEADINGS. The headings in this Agreement are for
convenience of reference only and shall not limit or otherwise affect the
meaning hereof.
SECTION 18. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE INTERNAL LAWS OF THE STATE OF NEW YORK, WITHOUT
REGARD TO THE PRINCIPLES OF THE CONFLICT OF LAWS THEREOF.
SECTION 19. JURISDICTION; FORUM. Each party hereto consents and submits
to the exclusive jurisdiction of any state court sitting in the County of New
York or federal court sitting in the Southern District of the State of New York
in connection with any dispute arising out of or relating to this Agreement.
Each party hereto waives any objection to the laying of venue in such courts and
any claim that any such action has been brought in an inconvenient forum. To the
extent permitted by law, any judgment in respect of a dispute arising out of or
relating to this Agreement may be enforced in any other jurisdiction within or
outside the United States by suit on the judgment, a certified copy of such
judgment being conclusive evidence of
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<PAGE>
the fact and amount of such judgment. Each party hereto agrees that personal
service of process may be effected by any of the means specified in Section 14,
addressed to such party. The foregoing shall not limit the rights of any party
to serve process in any other manner permitted by law.
SECTION 20. SEVERABILITY. In the event that any one or more of the
provisions contained herein, or the application thereof in any circumstance, is
held invalid, illegal or unenforceable, the validity, legality and
enforceability of any such provision in every other respect and of the remaining
provisions contained herein shall not be affected or impaired thereby.
SECTION 21. ENTIRE AGREEMENT. This Agreement is intended by the parties
as a final expression of their agreement and is intended to be a complete and
exclusive statement of the agreement and understanding of the parties hereto in
respect of the subject matter contained herein. This Agreement supersedes all
prior agreements and understandings between the parties with respect to such
subject matter.
SECTION 22. ATTORNEYS' FEES. In any proceeding brought to enforce any
provision of this Agreement, the successful party shall be entitled to recover
reasonable attorneys' fees in addition to its costs and expenses and any other
available remedy.
SECTION 23. GUARANTEE. Western does hereby agree to cause each Person
who is or at any time was a Holder to perform its obligations under this
Agreement, including, without limitation, with respect to indemnification, and a
breach of this Agreement by any such Person shall be deemed a breach of this
Agreement by Western.
[Remainder of Page Intentionally Left Blank]
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<PAGE>
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date first written above.
WESTAR CAPITAL, INC.
By: /s/ Rita A. Sharpe
------------------
Name: Rita A. Sharpe
Title: Chairman of the Board,
President
and Chief Executive Officer
WESTERN RESOURCES, INC.
By: /s/ John K. Rosenberg
---------------------
Name: John K. Rosenberg
Title: Executive Vice President
and General Counsel
TYCO INTERNATIONAL LTD.
By: /s/ Mark H. Swartz
-----------------
Name: Mark H. Swartz
Title: Executive Vice President
Chief Financial Officer
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<PAGE>
APPENDIX I
SHAREHOLDERS WITH REGISTRATION RIGHTS
FOR AN UNDERWRITTEN OFFERING
AS OF THE DATE OF THIS AGREEMENT
Shareholder Number of Shares
----------- ----------------
Michael Ashcroft 3,850,640
Stephen Ruzika 621,717
Certain holders of A Warrants or 92,108
B Warrants to acquire Common Shares
and certain holders of Common Shares
acquired upon the exercise of such
Warrants
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This letter agreement, dated as of July 16, 1997, is entered into among
Western Resources, Inc., a Kansas corporation ("Western Resources"), Westar
Capital, Inc., a Kansas corporation and a wholly-owned subsidiary of Western
Resources ("Westar"), and Tyco International Ltd. (formerly ADT Limited), a
company incorporated under the laws of Bermuda ("ADT" or "New Tyco").
RECITALS:
WHEREAS, on March 17, 1997, Western Resources and Westar commenced an
offer to exchange ADT common shares ("Shares") for shares of Western Resources
common stock and cash (the "Exchange Offer");
WHEREAS, ADT and Tyco International Ltd., a Massachusetts corporation
(now Tyco International (US) Inc.; "Old Tyco") entered into an Agreement and
Plan of Merger by and among ADT, a wholly-owned subsidiary of ADT, and Old Tyco,
dated March 17, 1997, pursuant to which such wholly-owned subsidiary of ADT was
merged with and into Old Tyco (the "ADT/Tyco Merger") on July 2, 1997;
WHEREAS, Western Resources and Westar withdrew the Exchange Offer at or
about the time of the ADT/Tyco Merger;
WHEREAS, as of the date of the ADT/Tyco Merger, Western Resources was
the beneficial owner of 38,287,111 Shares (prior to a reverse split of the
Shares effected in connection with the ADT/Tyco Merger);
WHEREAS, Western Resources by virtue of its Share ownership was not
able to prevent the approval by ADT shareholders of actions necessary to
complete the ADT/Tyco Merger;
WHEREAS, Western Resources has entered into an Agreement and Plan of
Merger between Western Resources and Kansas City Power & Light Company, a
Missouri corporation ("KCPL"), dated as of February 7, 1997 (the "KCPL
Agreement");
WHEREAS, Western Resources and Westar have not been provided with any
material non-public information by Old Tyco or ADT; and
WHEREAS, the parties hereto wish to make certain agreements as set
forth below:
NOW, THEREFORE, in consideration of the mutual covenants and
undertakings contained herein, and subject to and on the terms and conditions
set forth, the parties hereto agree as follows:
1. Western will promptly return or cause to be returned any shareholder
list (including any copies thereof and any notes, memoranda or analyses relating
thereto) of
<PAGE>
ADT that it or any of its affiliates has heretofore received or made and shall
make no request for a shareholder list of New Tyco for three years following
execution of this letter agreement. For such period of three years, Western
Resources will not make any demand on New Tyco pursuant to applicable Bermuda
law related to corporate books and records (to the extent it may otherwise be
entitled to do so by law).
2. New Tyco shall, and shall cause its affiliates to, cease and desist
from all frustrating acts (it being understood that New Tyco shall in no way be
restricted from selling shares of Western Resources or KCPL common stock or
compelled to take any action with respect to the voting of such shares),
including any communications with Western Resources or KCPL shareholders, in
connection with the transactions and shareholder approvals contemplated by the
KCPL Agreement. New Tyco will promptly return or cause to be returned any
shareholder list (including any copies thereof and any notes, memoranda or
analyses related thereto) of Western Resources and KCPL that it or any of its
affiliates has heretofore received or made and shall make no request for a
shareholder list of Western Resources or KCPL for three years following the
execution of this letter agreement. For such period of three years, neither New
Tyco nor any of its subsidiaries will make any demand on Western Resources or on
KCPL pursuant to applicable state law related to corporate books and records nor
shall it purchase any shares of common stock of either Western Resources or
KCPL.
3. The parties hereto will promptly take action to dismiss (and, in the
case of Section 3(ii) below, withdraw) the following litigation (the
"Litigation") with prejudice, with each side to bear its own costs, including
attorneys fees:
(i) Westar Capital Inc. v. ADT Ltd. et al., No. 96 Civ. 8889 (S.D.
Fla.) (Zloch, J.) (filed Dec. 27, 1996);
(ii) In the Matter of ADT Limited and in the Matter of Section 111 of
the Companies Act 1981 and in the Matter of the Petition of Westar
Capital, Inc., 1997: No. 143, Sup. Ct. Bermuda (filed April 16,
1997);
(iii) ADT Investments Inc. v. Western Resources, Inc., Case No. 97 CV
467 (District Court of Kansas, Shawnee County);
(iv) ADT Investments II, Inc. v. Kansas City Power & Light Company,
Case No. CV 97-11049 (Circuit Court, Jackson County, Missouri);
(v) ADT Investments Inc. v. Western Resources, Inc., Case No. 97
CV 852 (District Court of Kansas, Shawnee County); and
(vi) ADT Investments II, Inc. v. Kansas City Power & Light Company,
Case No. CV 97-16535 (Circuit Court, Jackson County, Missouri).
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<PAGE>
4. New Tyco will grant to Western Resources and Westar registration
rights, with respect to the Shares currently owned by Westar, as follows (and
including the provisions detailed in Annex A hereto):
(i) as soon as reasonably practicable following the date hereof (and
in no event later than five (5) business days after such date),
New Tyco will file a registration statement relating to the
distribution of the Shares currently owned by Westar, and New Tyco
will use its reasonable best efforts to cause such registration
statement to be declared effective as soon as practicable after
filing;
(ii) to the extent that a distribution under the registration statement
is an underwritten offering, each underwriter shall be mutually
acceptable to New Tyco and Western Resources, but New Tyco will
have no right to select or approve any investment banking firm to
act on behalf of Western Resources in respect of any block trade;
(iii) the total number of block trades and underwritten offerings to
which Western Resources shall be entitled under Sections 4(i) and
4(ii) hereof shall not exceed three (3) in the aggregate;
(iv) each of New Tyco, Western Resources and Westar will bear its own
costs in connection with such registrations; in that regard, New
Tyco will pay all issuer costs incurred in connection with such
registration, including without limitation all costs associated
with the printing and dissemination of the necessary
documentation, and Western Resources will pay all underwriting
commissions and the registration fee applicable to Shares to be
sold by Westar in connection therewith;
(v) New Tyco will use its best efforts to cooperate in a marketing
effort, including participation in a "road show" with appropriate
senior management, to assist Western Resources and Westar in
selling Shares in an underwritten offering under the registration
statement; and
(vi) if New Tyco shall cease to have an obligation to maintain the
registration of or to register the Shares, either because the
total number of block trades and underwritten offerings has
theretofore exceeded three or because the Shares have ceased to be
Registrable Securities (as defined in Annex A), New Tyco will
assist Western Resources in its disposition of the Shares by
participating in presentations to investors and furnishing them
with public information, all at reasonable times and in a manner
that does not unreasonably impose on the senior management of
Tyco.
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<PAGE>
5. Western, for itself and all Persons that now or may hereafter be
controlled by Western, each of its and their assigns and successors and any
Person or entity claiming through any of them (the "Western Releasing Parties"),
hereby absolutely, fully and forever releases, waives, relinquishes and
discharges each of New Tyco, Old Tyco, any Person now or hereafter controlled by
New Tyco, each of their current and former directors, officers, employees,
attorneys, advisors and investment bankers, and their respective successors and
assigns (the "Released Tyco Parties") from any and all Claims which any of the
Western Releasing Parties may have against the Released Tyco Parties, whether
known or unknown, (i) arising on account of or in any way relating to the
Exchange Offer or the ADT/Tyco Merger or (ii) arising through the date of this
Agreement by reason of its rights as a shareholder of New Tyco, including,
without limitation, all Claims raised or that could have been raised in the
Litigation; provided, however, that such Claims shall not include any claim to
enforce the provisions of this Agreement, including Annex A.
New Tyco, for itself and all Persons that now or may hereafter be
controlled by New Tyco, each of its and their assigns and successors and any
Person or entity claiming through any of them (the "Tyco Releasing Parties"),
hereby absolutely, fully and forever releases, waives, relinquishes and
discharges each of Western, Westar, Kansas City Power and Light Company
("KCPL"), any Person now or hereafter controlled by Western or KCPL, each of
their current and former directors, officers, employees, attorneys, advisors and
investment bankers, and their respective successors and assigns (the "Released
Western Parties") from any and all Claims which any of the Tyco Releasing
Parties may have against the Released Western Parties, whether known or unknown,
(i) arising on account of or in any way relating to the Exchange Offer or the
ADT/Tyco Merger or (ii) arising through the date of this Agreement by reason of
its rights as a shareholder of Western or KCPL, including, without limitation,
all Claims raised or that could have been raised in the Litigation; provided,
however, that such Claims shall not include any claim to enforce the provisions
of this Agreement, including Annex A.
As used in this paragraph, the term "Claim" means any causes of action,
suits, damages, debts, liabilities, demands, rights, obligations, costs,
expenses, losses, attorneys' fees, liens and indemnities, whether based on
contract, tort, statute or any other legal or equitable theory of recovery.
6. This letter agreement may be executed in one or more counterparts,
each of which when executed shall be deemed to be an original and all of which
taken together shall constitute one and the same agreement.
7. This agreement shall in all respects be interpreted, enforced,
governed and construed by and under the laws of the State of New York. Any
controversy arising under or relating to this agreement shall be exclusively
determined by the United States District Court for the Southern District of New
York, and the parties hereby consent, solely with respect to the matters
contemplated by this Agreement, to personal jurisdiction in the United States
District Court for the Southern District of New York and agree not to present
any such controversy to any other court or forum.
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<PAGE>
8. The parties hereto agree that any breach of the provisions of this
agreement would irreparably injure the other parties hereto and that money
damages would be an inadequate remedy therefor. Accordingly, each party hereto
shall be entitled to one or more injunctions enjoining any such breach and
requiring specific performance of this agreement and consent to the entry
thereof, in addition to any other remedy to which that party is entitled at law
or in equity.
9. This agreement is for settlement purposes only and will not be used
by the parties hereto in any litigation, other than litigation arising out of
this agreement.
[balance of this page intentionally left blank]
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<PAGE>
IN WITNESS WHEREOF, the parties have executed or caused this letter
agreement to be executed as of the date first written above.
TYCO INTERNATIONAL LTD.
(formerly ADT Limited)
By: /s/ Mark H. Swartz
------------------
Name: Mark H. Swartz
Title: Executive Vice President
Chief Financial Officer
WESTAR CAPITAL, INC.
By: /s/ Marilyn K. Dalton
---------------------
Name: Marilyn K. Dalton
Title: Secretary and Treasurer
WESTERN RESOURCES, INC.
By: /s/ John K. Rosenberg
---------------------
Name: John K. Rosenberg
Title: Executive Vice President
and General Counsel
- 6 -
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration
Statement on Form S-3 of our reports dated July 25, 1996 on our audits of the
consolidated financial statements and financial statement schedule of Tyco
International Ltd. as of June 30, 1996 and 1995 and for the three years in the
period ended June 30, 1996, which reports are included in the Company's Annual
Report on Form 10-K for the year ended June 30, 1996 and of our report dated
July 10, 1997 which is included in the Company's current report on Form 8-K on
our audits of the consolidated financial statements and the consolidated
financial statement schedule of Tyco International Ltd. as of December 31, 1996
and June 30, 1995 and for the years ended December 31, 1996, June 30, 1995 and
June 30, 1994 (not presented separately therein). We also consent to the
reference to our firm under the caption "Experts."
COOPERS & LYBRAND L.L.P.
Boston, Massachusetts
August 14, 1997
CONSENT OF INDEPENDENT ACCOUNTANTS
We consent to the incorporation by reference in this Registration
Statement on Form S-3 of Tyco International Ltd. (formerly named ADT Limited) of
our report dated March 26, 1997, on our audits of the consolidated financial
statements and consolidated financial statement schedules of ADT Limited as at
December 31, 1996 and 1995, and for the years ended December 31, 1996, 1995 and
1994, which report is included in the Company's Annual Report on Form 10-K for
the year ended December 31, 1996, and of our report dated July 10, 1997, on our
examination of the combination of the historical consolidated financial
statements and consolidated financial statement schedule of ADT Limited and Tyco
International Ltd. (prior to the merger) after restatement for the pooling of
interests as described in Note 1 to the supplemental consolidated financial
statements, which report is included in the Company's Current Report on Form 8-K
dated July 10, 1997. We also consent to the reference to our firm under the
caption "Experts."
COOPERS & LYBRAND
Hamilton, Bermuda
August 14, 1997
