<PAGE>
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- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
------------------------
SCHEDULE 14D-1
TENDER OFFER STATEMENT
PURSUANT TO SECTION 14(D)(1) OF THE SECURITIES EXCHANGE ACT OF 1934
---------------------
GIDDINGS & LEWIS, INC.
(Name of Subject Company)
------------------------------
THYSSEN AKTIENGESELLSCHAFT
TAQU, INC.
(Bidders)
------------------------------
COMMON STOCK, PAR VALUE U.S. $0.10 PER SHARE
(Title of Class of Securities)
------------------------------
375048105
(CUSIP Number of Class of Securities)
------------------------------
AXEL KIRSCH
PRESIDENT
TAQU, INC.
3155 WEST BIG BEAVER ROAD
TROY, MICHIGAN 48007
(810) 643-3511
(Name, Address and Telephone Number of Person Authorized
to Receive Notices and Communications on Behalf of Bidder)
------------------------------
COPIES TO:
NEIL T. ANDERSON, ESQ.
SULLIVAN & CROMWELL
125 BROAD STREET
NEW YORK, NEW YORK 10004
(212) 558-4000
------------------------
CALCULATION OF FILING FEE
<TABLE>
<S> <C>
TRANSACTION VALUATION* AMOUNT OF FILING FEE**
$674,419,767 $134,884
</TABLE>
* For the purpose of calculating the filing fee only. This calculation assumes
the purchase of 32,115,227 shares of Common Stock, par value U.S. $0.10 per
share ("Shares"), of Giddings & Lewis, Inc. (the "Company") (equal to the
sum of (i) 31,043,365 Shares issued and outstanding as of June 11, 1997,
according to the Company, and (ii) and 1,071,862 Shares issuable pursuant to
exerciseable options outstanding as of June 11, 1997, according to the
Company) multiplied by the offer price of $21.00 per Share.
** 1/50 of 1% of transaction valuation.
/ / Check box if any part of the fee is offset as provided by Rule 0-11(a)(2)
and identify the filing with which the offsetting fee was previously paid.
Identify the previous filing by registration statement number or the Form or
Schedule and the date of its filing.
Amount previously paid: not applicable. Filing party: not applicable.
Form or registration: not applicable. Date filed: not applicable.
- --------------------------------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE>
<TABLE>
<S> <C>
CUSIP No. 375048-10-5
</TABLE>
<TABLE>
<C> <S>
1. Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
Thyssen Aktiengesellschaft
2. Check the Appropriate Box if a Member of a Group (a)
/ /
(b) / /
3. SEC Use Only
4. Sources of Funds
WC
5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(e) or
2(f) / /
6. Citizenship or Place of Organization
Federal Republic of Germany
7. Aggregate Amount Beneficially Owned by Each Reporting Person
None
8. Check if the Aggregate Amount in Row (7) Excludes Certain Shares / /
9. Percent of Class Represented by Amount in Row (7)
0.0%
10. Type of Reporting Person
CO
</TABLE>
2
<PAGE>
<TABLE>
<S> <C>
CUSIP No. 375048-10-5
</TABLE>
<TABLE>
<C> <S>
1. Name of Reporting Person
S.S. or I.R.S. Identification No. of Above Person
TAQU, Inc.
2. Check the Appropriate Box if a Member of a Group (a)
/ /
(b) / /
3. SEC Use Only
4. Sources of Funds
AF
5. Check if Disclosure of Legal Proceedings is Required Pursuant to Items 2(e) or
2(f) / /
6. Citizenship or Place of Organization
Delaware
7. Aggregate Amount Beneficially Owned by Each Reporting Person
None
8. Check if the Aggregate Amount in Row (7) Excludes Certain Shares / /
9. Percent of Class Represented by Amount in Row (7)
0.0%
10. Type of Reporting Person
CO
</TABLE>
3
<PAGE>
This Tender Offer Statement on Schedule 14D-1 (this "Statement") relates to
the offer by TAQU, Inc. (the "Purchaser"), a Delaware corporation and an
indirect wholly owned subsidiary of Thyssen Aktiengesellschaft, a corporation
organized under the laws of the Federal Republic of Germany ("Thyssen"), to
purchase all outstanding shares of Common Stock, $.10 par value per share of the
Company together with any associated preferred share purchase rights (the
"Rights" and together with the Common Stock, the "Shares") issued pursuant to
the Rights Agreement between the Company and Firstar Trust Company, as rights
agent, at a price of $21.00 per Share, net to the seller in cash, without
interest thereon (the "Offer Price"), upon the terms and subject to the
conditions set forth in the Purchaser's Offer to Purchase, dated June 18, 1997
(the "Offer to Purchase"), and in the related Letter of Transmittal (the "Letter
of Transmittal") (which, as either may be amended from time to time, together
constitute the "Offer"), copies of which are attached hereto as Exhibits (a)(1)
and (a)(2), respectively. Unless the context otherwise requires, all references
to Shares include the Rights.
ITEM 1. SECURITY AND SUBJECT COMPANY.
(a) The name of the subject company is Giddings & Lewis, Inc., a Wisconsin
corporation (the "Company"), which has its principal executive offices at 142
Doty Street, Fond du Lac, Wisconsin 54935.
(b) The class of equity securities being sought is all the outstanding
shares of Common Stock, par value $.10 per share, of the Company, together with
any associated Rights. The information set forth in the "Introduction" and
Section 1 ("Terms of the Offer; Expiration Date") of the Offer to Purchase is
incorporated herein by reference.
(c) The information concerning the principal market in which the Shares are
traded and certain high and low sales prices for the Shares in such principal
market set forth in Section 6 ("Price Range of Shares; Dividends") of the Offer
to Purchase is incorporated herein by reference.
ITEM 2. IDENTITY AND BACKGROUND.
(a)-(d); (g) This Statement is filed by Purchaser and Thyssen. The
information concerning the name, state or other place of organization, principal
business and address of the principal office of each of Purchaser and Thyssen,
and the information concerning the name, business address, present principal
occupation or employment, principal business and address of any corporation or
other organization in which such employment or occupation is conducted, material
occupations, positions, offices or employments during the past five years and
citizenship of each director and executive officer of Purchaser and Thyssen are
set forth in the Introduction, Section 8 ("Certain Information Concerning
Purchaser and Thyssen") and Schedule I of the Offer to Purchase and are
incorporated herein by reference.
(e) and (f) During the last five years, none of the Purchaser and Thyssen,
and, to the best of knowledge of Purchaser and Thyssen, none of the persons
listed in Schedule I of the Offer to Purchase has been (i) convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors) or
(ii) a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining future violations of, or prohibiting
activities subject to, federal or state securities laws or finding any violation
of such law.
ITEM 3. PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY.
(a) The information set forth in Section 8 ("Certain Information Concerning
Purchaser and Thyssen") and Section 10 ("Background of the Offer; Contacts with
the Company; the Merger Agreement") of the Offer to Purchase is incorporated
herein by reference.
(b) The information set forth in the Introduction, Section 7 ("Certain
Information Concerning the Company"), Section 8 ("Certain Information Concerning
Purchaser and Thyssen"), Section 10 ("Background of the Offer; Contacts with the
Company; the Merger Agreement") and Section 11 ("Purpose of
4
<PAGE>
the Offer; Plans for the Company After the Offer and the Merger") of the Offer
to Purchase is incorporated herein by reference.
ITEM 4. SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION.
(a)-(c) The information set forth in Section 9 ("Financing of the Offer and
the Merger") of the Offer to Purchase is incorporated herein by reference.
ITEM 5. PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER.
(a)-(e) The information set forth in the Introduction, Section 10
("Background of the Offer; Contacts with the Company; the Merger Agreement") and
Section 11 ("Purpose of the Offer; Plans for the Company After the Offer and the
Merger") of the Offer to Purchase is incorporated herein by reference.
(f) and (g) The information set forth in Section 13 ("Effect of the Offer on
the Market for Shares, Exchange Listing and Exchange Act Registration") of the
Offer to Purchase is incorporated herein by reference.
ITEM 6. INTEREST IN SECURITIES OF THE SUBJECT COMPANY.
(a) and (b) The information set forth in Section 8 ("Certain Information
Concerning Purchaser and Thyssen") of the Offer to Purchase is incorporated
herein by reference.
ITEM 7. CONTRACTS, ARRANGEMENTS, UNDERSTANDINGS OR RELATIONSHIPS WITH RESPECT TO
THE SUBJECT COMPANY'S SECURITIES.
The information set forth in the Introduction, Section 8 ("Certain
Information Concerning Purchaser and Thyssen"), Section 10 ("Background of the
Offer; Contacts with the Company; the Merger Agreement") and Section 11
("Purpose of the Offer; Plans for the Company After the Offer and the Merger")
of the Offer to Purchase is incorporated herein by reference.
ITEM 8. PERSON RETAINED, EMPLOYED OR TO BE COMPENSATED.
The information set forth in the Introduction and Section 16 ("Fees and
Expenses") of the Offer to Purchase is incorporated herein by reference.
ITEM 9. FINANCIAL STATEMENTS OF CERTAIN BIDDERS.
The information set forth in Section 8 ("Certain Information Concerning
Purchaser and Thyssen") of the Offer to Purchase is incorporated herein by
reference.
ITEM 10. ADDITIONAL INFORMATION.
(a) Not applicable.
(b) and (c) The information set forth in Section 15 ("Certain Legal
Matters") of the Offer to Purchase is incorporated herein by reference.
(d) Not applicable.
(e) Not applicable.
(f) The information set forth in the Offer to Purchase is incorporated
herein by reference.
5
<PAGE>
ITEM 11. MATERIAL TO BE FILED AS EXHIBITS.
<TABLE>
<CAPTION>
(a)(1) Offer to Purchase, dated June 18, 1997.
<S> <C>
(a)(2) Letter of Transmittal with respect to the Shares.
(a)(3) Notice of Guaranteed Delivery.
(a)(4) Form of Letter, dated June 18, 1997, to brokers, dealers, commercial banks, trust
companies and nominees.
(a)(5) Form of Letter from brokers, dealers, commercial banks, trust companies and nominees
to their clients.
(a)(6) Guidelines for Certification of Taxpayer Identification Number on Substitute Form
W-9.
(a)(7) Summary Advertisement as published in The Wall Street Journal on June 18, 1997.
(a)(8) Press Release issued by Giddings & Lewis, Inc. and Thyssen AG, dated June 12, 1997.
(b) None.
(c)(1) Merger Agreement, dated as of June 11, 1997, by and among Thyssen
Aktiengesellschaft, TAQU, Inc. and Giddings & Lewis, Inc.
(d) None.
(e) Not applicable.
(f) None.
</TABLE>
6
<PAGE>
SIGNATURE
After due inquiry and to the best of my knowledge and belief, I certify that
the information set forth in this statement is true, complete and correct.
Dated: June 18, 1997
THYSSEN AKTIENGESELLSCHAFT
By: /s/ DR. ECKHARD ROHKAMM
-----------------------------------------
Name: Dr. Eckhard Rohkamm
Title: Member of the Executive Board
By: /s/ DR. ECKART BROCKFELD
-----------------------------------------
Name: Dr. Eckart Brockfeld
Title: Authorized Officer
TAQU, INC.
By: /s/ AXEL KIRSCH
-----------------------------------------
Name: Axel Kirsch
Title: President
7
<PAGE>
EXHIBIT INDEX
<TABLE>
<CAPTION>
SEQUENTIALLY
EXHIBIT NUMBERED
NUMBER DESCRIPTION PAGE
- ----------- -------------------------------------------------------------------------------------------- -----------------
<S> <C> <C>
(a)(1) Offer to Purchase, dated June 18, 1997......................................................
(a)(2) Letter of Transmittal with respect to the Shares............................................
(a)(3) Notice of Guaranteed Delivery...............................................................
(a)(4) Form of Letter dated June 18, 1997, to brokers, dealers, commercial banks, trust companies
and nominees................................................................................
(a)(5) Form of Letter from brokers, dealers, commercial banks, trust companies and nominees to
their clients...............................................................................
(a)(6) Guidelines for Certification of Taxpayer Identification Number on Substitute Form W-9.......
(a)(7) Summary Advertisement as published in The Wall Street Journal on June 18, 1997..............
(a)(8) Press Release issued by Giddings & Lewis, Inc. and Thyssen AG, dated June 12, 1997..........
(b) None........................................................................................
(c)(1) Merger Agreement, dated as of June 11, 1997, by and among Thyssen Aktiengesellschaft, TAQU,
Inc. and Giddings & Lewis, Inc..............................................................
(d) None........................................................................................
(e) Not applicable..............................................................................
(f) None........................................................................................
</TABLE>
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED RIGHTS TO PURCHASE
CLASS A PREFERRED STOCK, SERIES B)
OF
GIDDINGS & LEWIS, INC.
AT
$21.00 NET PER SHARE
BY
TAQU, INC.
AN INDIRECT WHOLLY OWNED SUBSIDIARY OF
THYSSEN AKTIENGESELLSCHAFT
--------
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON WEDNESDAY, JULY 16, 1997, UNLESS THE OFFER IS EXTENDED.
-------------------
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY TENDERED
AND NOT WITHDRAWN PRIOR TO THE EXPIRATION DATE A NUMBER OF SHARES OF COMMON
STOCK, PAR VALUE $0.10 PER SHARE, INCLUDING THE ASSOCIATED RIGHTS TO
PURCHASE SHARES OF CLASS A PREFERRED STOCK, SERIES B, OF GIDDINGS & LEWIS,
INC. REPRESENTING NOT LESS THAN A MAJORITY OF THE SHARES THEN OUTSTANDING
ON A FULLY DILUTED BASIS. THE OFFER IS ALSO CONDITIONED UPON THE
EXPIRATION OR TERMINATION OF ALL WAITING PERIODS IMPOSED BY THE
HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT OF 1976, AS AMENDED,
AND THE REGULATIONS THEREUNDER AND ANY APPLICABLE FOREIGN
COMPETITION AND ANTITRUST STATUTES AND REGULATIONS, INCLUDING THE
APPROVAL OF THE GERMAN FEDERAL CARTEL OFFICE PURSUANT TO THE
GERMAN ACT AGAINST RESTRAINTS OF
COMPETITION.
-------------------
THE BOARD OF DIRECTORS OF GIDDINGS & LEWIS, INC. (THE "COMPANY") HAS UNANIMOUSLY
APPROVED THE OFFER AND RECOMMENDS THAT SHAREHOLDERS ACCEPT THE OFFER AND
TENDER THEIR SHARES PURSUANT TO THE OFFER.
-------------------
IMPORTANT
ANY SHAREHOLDER DESIRING TO TENDER ALL OR ANY PORTION OF SUCH SHAREHOLDER'S
SHARES OF COMMON STOCK OF THE COMPANY (THE "COMMON STOCK") INCLUDING THE
ASSOCIATED RIGHTS TO PURCHASE CLASS A PREFERRED STOCK, SERIES B (THE "RIGHTS"
AND TOGETHER WITH THE COMMON STOCK, THE "SHARES") SHOULD EITHER (1) COMPLETE AND
SIGN THE LETTER OF TRANSMITTAL (OR A FACSIMILE THEREOF) IN ACCORDANCE WITH THE
INSTRUCTIONS IN THE LETTER OF TRANSMITTAL, INCLUDING ANY REQUIRED SIGNATURE
GUARANTEES, AND MAIL OR DELIVER THE LETTER OF TRANSMITTAL (OR SUCH FACSIMILE)
WITH THE CERTIFICATE(S) FOR THE TENDERED SHARES AND ANY OTHER REQUIRED DOCUMENTS
TO THE DEPOSITARY, (2) FOLLOW THE PROCEDURE FOR BOOK-ENTRY TENDER OF SHARES SET
FORTH IN SECTION 3, OR (3) REQUEST SUCH SHAREHOLDER'S BROKER, DEALER, COMMERCIAL
BANK, TRUST COMPANY OR OTHER NOMINEE TO EFFECT THE TRANSACTION FOR SUCH
SHAREHOLDER. SHAREHOLDERS HAVING SHARES REGISTERED IN THE NAME OF A BROKER,
DEALER, COMMERCIAL BANK, TRUST COMPANY OR OTHER NOMINEE ARE URGED TO CONTACT
SUCH BROKER, DEALER, COMMERCIAL BANK, TRUST COMPANY OR OTHER NOMINEE IF THEY
DESIRE TO TENDER SHARES SO REGISTERED.
A SHAREHOLDER WHO DESIRES TO TENDER SHARES AND WHOSE CERTIFICATES FOR SUCH
SHARES ARE NOT IMMEDIATELY AVAILABLE, OR WHO CANNOT COMPLY WITH THE PROCEDURE
FOR BOOK-ENTRY TRANSFER ON A TIMELY BASIS, MAY TENDER SUCH SHARES BY FOLLOWING
THE PROCEDURES FOR GUARANTEED DELIVERY SET FORTH IN SECTION 3.
QUESTIONS AND REQUESTS FOR ASSISTANCE MAY BE DIRECTED TO THE INFORMATION
AGENT OR TO THE DEALER MANAGER AT THEIR RESPECTIVE ADDRESSES AND TELEPHONE
NUMBERS SET FORTH ON THE BACK COVER OF THIS OFFER TO PURCHASE. ADDITIONAL COPIES
OF THIS OFFER TO PURCHASE, THE LETTER OF TRANSMITTAL AND THE NOTICE OF
GUARANTEED DELIVERY MAY ALSO BE OBTAINED FROM THE INFORMATION AGENT OR FROM
BROKERS, DEALERS, COMMERCIAL BANKS OR TRUST COMPANIES.
---------------------
THE DEALER MANAGER FOR THE OFFER IS:
MORGAN STANLEY DEAN WITTER
JUNE 18, 1997
<PAGE>
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
-----
<C> <S> <C>
INTRODUCTION................................................................................................... 1
THE TENDER OFFER............................................................................................... 2
1. Terms of the Offer; Expiration Date................................................................. 2
2. Acceptance for Payment and Payment for Shares....................................................... 3
3. Procedures for Accepting the Offer and Tendering Shares............................................. 4
4. Withdrawal Rights................................................................................... 7
5. Certain Federal Income Tax Consequences............................................................. 8
6. Price Range of Shares; Dividends.................................................................... 9
7. Certain Information Concerning the Company.......................................................... 9
8. Certain Information Concerning Purchaser and Thyssen................................................ 13
9. Financing of the Offer and the Merger............................................................... 16
10. Background of the Offer; Contacts with the Company; the Merger Agreement............................ 16
11. Purpose of the Offer; Plans for the Company After the Offer and the Merger.......................... 21
12. Dividends and Distributions......................................................................... 22
13. Effect of the Offer on the Market for the Shares; Exchange Listing and Exchange Act Registration.... 22
14. Certain Conditions of the Offer..................................................................... 23
15. Certain Legal Matters............................................................................... 25
16. Fees and Expenses................................................................................... 29
17. Miscellaneous....................................................................................... 29
SCHEDULE I: Directors and Executive Officers of Thyssen and TAQU.............................................. S-1
</TABLE>
i
<PAGE>
To the Holders of Common Stock of
Giddings & Lewis, Inc.:
INTRODUCTION
TAQU, Inc., a Delaware corporation (the "Purchaser") and an indirect wholly
owned subsidiary of Thyssen Aktiengesellschaft, a corporation organized under
the laws of the Federal Republic of Germany ("Thyssen"), hereby offers to
purchase all of the outstanding shares of Common Stock, par value $0.10 per
share (the "Common Stock"), of Giddings & Lewis, Inc., a Wisconsin corporation
(the "Company"), including the associated rights to purchase Class A Preferred
Stock, Series B (the "Rights") issued pursuant to the Rights Agreement between
the Company and Firstar Trust Company, as rights agent (the Common Stock and the
Rights together are referred to herein as the "Shares") at $21.00 per Share, net
to the seller in cash, without interest thereon (the "Offer Price"), upon the
terms and subject to the conditions set forth in this Offer to Purchase and in
the related Letter of Transmittal (which together constitute the "Offer").
Tendering shareholders will not be obligated to pay brokerage fees or
commissions or, subject to Instruction 6 of the Letter of Transmittal, transfer
taxes on the purchase of Shares by the Purchaser. The Purchaser will pay all
charges and expenses of Morgan Stanley & Co. Incorporated ("Morgan Stanley"),
which firm is acting as Dealer Manager (the "Dealer Manager"), Morgan Guaranty
Trust Company of New York, which firm is acting as the Depositary (the
"Depositary"), and Morrow & Co., Inc. which firm is acting as Information Agent
(the "Information Agent"), incurred in connection with the Offer. See Section 16
herein.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION DATE (AS DEFINED IN SECTION 1
HEREIN) A NUMBER OF SHARES REPRESENTING NOT LESS THAN A MAJORITY OF THE SHARES
THEN OUTSTANDING ON A FULLY DILUTED BASIS. THE OFFER IS ALSO CONDITIONED UPON
THE EXPIRATION OR TERMINATION OF ALL WAITING PERIODS IMPOSED BY THE
HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT OF 1976, AS AMENDED (THE "HSR ACT")
AND THE REGULATIONS THEREUNDER AND ANY APPLICABLE FOREIGN COMPETITION AND
ANTITRUST STATUTES AND REGULATIONS, INCLUDING THE APPROVAL OF THE GERMAN FEDERAL
CARTEL OFFICE PURSUANT TO THE GERMAN ACT AGAINST RESTRAINTS OF COMPETITION.
THE BOARD OF DIRECTORS OF THE COMPANY HAS UNANIMOUSLY APPROVED THE OFFER AND
RECOMMENDS THAT SHAREHOLDERS ACCEPT THE OFFER.
The Offer is being made pursuant to an Agreement and Plan of Merger (the
"Merger Agreement"), dated as of June 11, 1997, among the Company, Thyssen and
the Purchaser, pursuant to which, after the completion of the Offer, the
Purchaser will be merged with and into the Company and each outstanding Share,
not owned by Thyssen or its direct or indirect subsidiaries (or by shareholders
who properly exercise dissenters' rights, if any), will be converted into the
right to receive $21.00 in cash (the "Merger").
According to the Company, as of June 11, 1997, there were 31,043,365 Shares
outstanding and there were 1,643,483 Shares subject to issuance pursuant to the
Company's stock option and incentive plans. According to the Company, there are
no other classes of capital stock issued and outstanding as of the date hereof
other than the Common Stock.
PURPOSE OF THE OFFER
The purpose of the Offer is to acquire for cash as many outstanding Shares
as possible as a first step in acquiring the entire equity interest in the
Company. Upon the consummation of the Offer, Thyssen intends to consummate, as
soon as possible after completion of the Offer, the Merger pursuant to and in
accordance with the terms set forth in the Merger Agreement. The Merger
Agreement provides that, among other things, as soon as practicable after the
purchase of Shares pursuant to the Offer and the satisfaction of the other
conditions set forth in the Merger Agreement and in accordance with the relevant
provisions of the Business Corporation Law of the State of Wisconsin (the
"BCL"), and the Delaware General Corporation Law ("DGCL"), Purchaser will be
merged with and into the Company. Following
<PAGE>
consummation of the Merger, the Company will continue as the surviving
corporation (the "Surviving Corporation") and will become an indirect wholly
owned subsidiary of Thyssen. At the effective time of the Merger (the "Effective
Time"), each Share issued and outstanding immediately prior to the Effective
Time (other than Shares held in the treasury of the Company or owned by
Purchaser, Thyssen or any direct or indirect wholly owned subsidiary of Thyssen
or the Company, and other than Shares held by shareholders who shall have
demanded and perfected appraisal rights, if any, under the BCL) will be canceled
and converted automatically into the right to receive $21.00 in cash, or any
higher price that may be paid per Share in the Offer, without interest (the
"Merger Consideration"). See Section 11.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION AND SHOULD BE READ IN THEIR ENTIRETY BEFORE ANY DECISION
IS MADE WITH RESPECT TO THE OFFER.
THE TENDER OFFER
1. TERMS OF THE OFFER; EXPIRATION DATE. Upon the terms and subject to the
conditions set forth in the Offer (including, if the Offer is extended or
amended, the terms and conditions of such extension or amendment), the Purchaser
will accept for payment, and pay for, all Shares validly tendered on or prior to
the Expiration Date and not withdrawn as permitted by Section 2. The term
"Expiration Date" means 12:00 Midnight, New York City time, on Wednesday, July
16, 1997, unless and until the Purchaser, in its sole discretion, shall have
extended the period of time during which the Offer is open, in which event the
term "Expiration Date" shall mean the latest time and date at which the Offer,
as so extended by the Purchaser, will expire.
In all cases, payment for Shares tendered and purchased pursuant to the
Offer will be made only after timely receipt by the Depositary of, among other
things, certificates representing Rights ("Rights Certificates"), if such Rights
Certificates have been distributed to shareholders.
The Purchaser expressly reserves the right, in its sole discretion, at any
time or from time to time, to extend the period of time during which the Offer
is open by giving oral or written notice of such extension to the Depositary.
Any such extension will also be publicly announced by press release issued no
later than 9:00 A.M., New York City time, on the next business day after the
previously scheduled Expiration Date. During any such extension, all Shares
previously tendered and not withdrawn will remain subject to the Offer, subject
to the right of a tendering shareholder to withdraw his Shares. See Section 4.
Subject to the applicable regulations of the Securities and Exchange Commission
(the "Commission"), the Purchaser also expressly reserves the right, in its sole
discretion, at any time or from time to time, (i) to delay acceptance for
payment of or, regardless of whether such Shares were theretofore accepted for
payment, payment for any Shares or to terminate the Offer and not accept for
payment or pay for any Shares not theretofore accepted for payment, or paid for,
upon the occurrence of any of the conditions specified in Section 14 and (ii) to
waive any condition or otherwise amend the Offer in any respect, by giving oral
or written notice of such delay, termination or amendment to the Depositary and
by making a public announcement thereof. If the Purchaser accepts any Shares for
payment pursuant to the terms of the Offer, it will accept for payment all
Shares validly tendered prior to the Expiration Date and not withdrawn, and,
subject to (i) above, will promptly pay for all Shares so accepted for payment.
The Purchaser confirms that its reservation of the right to delay payment for
Shares which it has accepted for payment is limited by Rule 14e-1(c) under the
Securities and Exchange Act of 1934 (the "Exchange Act"), which requires that a
tender offeror pay the consideration offered or return the tendered securities
promptly after the termination or withdrawal of a tender offer.
Any extension, delay, termination or amendment of the Offer will be followed
as promptly as practicable by public announcement thereof, such announcement in
the case of an extension to be issued no later than 9:00 A.M., New York City
time, on the next business day after the previously scheduled Expiration Date.
Subject to applicable law (including Rules 14d-4(c) and 14d-6(d) under the
Exchange
2
<PAGE>
Act, which require that any material change in the information published, sent
or given to shareholders in connection with the Offer be promptly disseminated
to shareholders in a manner reasonably designed to inform shareholders of such
change) and without limiting the manner in which the Purchaser may choose to
make any public announcement, the Purchaser shall have no obligation to publish,
advertise or otherwise communicate any such public announcement other than by
making a release to the Dow Jones News Service.
The Purchaser confirms that if it makes a material change in the terms of
the Offer or the information concerning the Offer, or if it waives a material
condition of the Offer, the Purchaser will extend the Offer to the extent
required by Rules 14d-4(c) and 14d-6(d) under the Exchange Act.
If, prior to the Expiration Date, the Purchaser, in its sole discretion,
shall decrease the percentage of Shares being sought or the consideration
offered to holders of Shares, such decrease shall be applicable to all holders
whose Shares are accepted for payment pursuant to the Offer and, if at the time
notice of any decrease is first published, sent or given to holders of Shares,
the Offer is scheduled to expire at any time earlier than the tenth business day
from and including the date that such notice is first so published, sent or
given, the Offer will be extended until the expiration of such ten business-day
period. For purposes of the Offer, a "business day" means any day other than a
Saturday, Sunday or federal holiday and consists of the time period from 12:01
A.M. through 12:00 Midnight, New York City time.
The Offer is being mailed to holders of Shares from a list provided to the
Purchaser by the Company.
2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES. Upon the terms and
subject to the conditions of the Offer, (including, if the Offer is extended or
amended, the terms and conditions of any such extension or amendment), the
Purchaser will accept for payment, and will pay for, Shares validly tendered and
not withdrawn as promptly as practicable after the later of (i) the expiration
or termination of the waiting period applicable to the acquisition of Shares
pursuant to the Offer under the HSR Act and any applicable foreign competition
and antitrust statutes and regulations, (ii) the Expiration Date and (iii) the
approval of the German Federal Cartel Office pursuant to the German Act Against
Restraints of Competition. Thyssen filed a Notification and Report Form under
the HSR Act on June 16, 1997, and, accordingly, unless earlier terminated or
extended by a request for additional information, the waiting period under the
HSR Act is scheduled to expire at 11:59 P.M., New York City time, on July 1,
1997. See Section 15. In addition, subject to applicable rules of the
Commission, the Purchaser expressly reserves the right to delay acceptance for
payment of or payment for Shares in order to comply, in whole or in part, with
any applicable law. See Section 13. In all cases, payment for Shares tendered
and accepted for payment pursuant to the Offer will be made only after timely
receipt by the Depositary of certificates for such Shares (or a confirmation of
a book-entry transfer of such Shares into the Depositary's account at The
Depository Trust Company or the Philadelphia Securities Depository Trust Company
(each a "Book-Entry Transfer Facility" and, collectively, the "Book-Entry
Transfer Facilities"), a properly completed and duly executed Letter of
Transmittal (or facsimile thereof) and any other required documents.
For purposes of the Offer, the Purchaser will be deemed to have accepted for
payment Shares validly tendered and not withdrawn as, if and when the Purchaser
gives oral or written notice to the Depositary of its acceptance for payment of
such Shares pursuant to the Offer. Payment for Shares accepted for payment
pursuant to the Offer will be made by deposit of the purchase price therefor
with the Depositary, which will act as agent for the tendering shareholders for
purpose of receiving payments from the Purchaser and transmitting such payments
to the tendering shareholders. Under no circumstances will interest on the
purchase price for Shares be paid, regardless of any delay in making such
payment.
If any tendered Shares are not accepted for payment pursuant to the terms
and conditions of the Offer for any reason, or if certificates are submitted for
more Shares than are tendered, certificates for such unpurchased Shares will be
returned, without expense to the tendering shareholder (or, in the case of
Shares tendered by book-entry transfer of such Shares into the Depositary's
account at a Book-Entry Transfer Facility pursuant to the procedures set forth
in Section 3, such Shares will be credited to an
3
<PAGE>
account maintained with such Book-Entry Transfer Facility), as soon as
practicable following expiration or termination of the Offer.
The Purchaser reserves the right to transfer or assign in whole or in part
from time to time to one or more direct or indirect subsidiaries of Thyssen the
right to purchase all or any portion of the Shares tendered pursuant to the
Offer, but any such transfer or assignment will not relieve the Purchaser of its
obligations under the Offer and will in no way prejudice the rights of tendering
shareholders to receive payment for Shares validly tendered and accepted for
payment pursuant to the Offer.
3. PROCEDURES FOR ACCEPTING THE OFFER AND TENDERING SHARES. In order for a
holder of Shares validly to tender Shares pursuant to the Offer, either (a) a
properly completed and duly executed Letter of Transmittal (or a facsimile
thereof) in accordance with the instructions of the Letter of Transmittal, with
any required signature guarantees, certificates for the Common Stock (and
Rights, if applicable) to be tendered, and any other documents required by the
Letter of Transmittal, must be received by the Depositary at one of its
addresses set forth on the back cover of this Offer to Purchase prior to the
Expiration Date, (b) such Common Stock and Rights must be delivered pursuant to
the procedures for book-entry transfer described below (and a confirmation of
such delivery received by the Depositary, including an Agent's Message (as
defined herein) if the tendering shareholder has not delivered a Letter of
Transmittal), prior to the Expiration Date, or (c) the tendering shareholder
must comply with the guaranteed delivery procedures set forth below. The term
"Agent's Message" means a message, transmitted by a Book-Entry Transfer Facility
to, and received by, the Depositary and forming a part of a book-entry
confirmation, which states that such Book-Entry Transfer Facility has received
an express acknowledgment from the participant in such Book-Entry Transfer
Facility tendering the Common Stock and, if applicable, Rights which are the
subject of such book-entry confirmation, that such participant has received and
agrees to be bound by the terms of the Letter of Transmittal and that the
Purchaser may enforce such agreement against the participant.
Unless a Distribution Date (as defined in Section 7) occurs, the Rights will
be transferred with and only with the certificates for Shares and the surrender
for transfer of any certificates for Common Stock will also constitute the
transfer of the Rights associated with the Shares represented by such
certificate. If separate certificates representing the Rights are issued to
holders of Common Stock prior to the time a holder's shares of Common Stock are
tendered pursuant to the Offer, certificates representing a number of Rights
equal to the number of shares of Common Stock tendered must be delivered to the
Depositary, or, if available, a Book-Entry Confirmation (as defined herein)
received by the Depositary with respect thereto, in order for such shares of
Common Stock to be validly tendered. If the Distribution Date occurs and
separate certificates representing the Rights are not distributed prior to the
time shares of Common Stock are tendered pursuant to the Offer, Rights may be
tendered prior to a shareholder receiving the certificates for Rights by use of
the guaranteed delivery procedure described below. A tender of shares of Common
Stock constitutes an agreement by the tendering shareholder to deliver
certificates representing all Rights formerly associated with the number of
shares of Common Stock tendered pursuant to the Offer to the Depositary prior to
expiration of the period permitted by such guaranteed delivery procedures for
delivery of certificates for, or a Book-Entry Confirmation with respect to,
Rights (the "Rights Delivery Period"). However, after expiration of the Rights
Delivery Period, the Purchaser may elect to reject as invalid a tender of shares
of Common Stock with respect to which certificates for, or a Book-Entry
Confirmation with respect to, number of Rights required to be tendered with such
Common Stock have not been received by the Depositary. Nevertheless, the
Purchaser will be entitled to accept for payment shares of Common Stock tendered
by a shareholder prior to receipt of the certificates for the Rights required to
be tendered with such shares of Common Stock, or a Book-Entry Confirmation with
respect to such Rights, and either (a) subject to complying with applicable
rules and regulations of the Commission, withhold payment for such shares of
Common Stock pending receipt of the certificates for, or a Book-Entry
Confirmation with respect to, such Rights or (b) make payment for shares of
Common Stock accepted for payment pending receipt of the certificates for, or a
Book-Entry Confirmation with respect to,
4
<PAGE>
such Rights in reliance upon the agreement of a tendering shareholder to deliver
Rights and such guaranteed delivery procedures. Any determination by the
Purchaser to make payment for shares of Common Stock in reliance upon such
agreement and such guaranteed delivery procedures or, after expiration of the
Rights Delivery Period, to reject a tender as invalid will be made in the sole
and absolute discretion of the Purchaser.
BOOK-ENTRY DELIVERY. The Depositary will establish accounts with respect to
the Shares at the Book-Entry Facilities for purposes of the Offer within two
business days after the date of this Offer to Purchase. Any financial
institution that is a participant in any of the Book-Entry Transfer Facilities'
systems may make book-entry transfer of Shares by causing a Book-Entry Transfer
Facility to transfer such Shares into the Depositary's account in accordance
with such Book-Entry Transfer Facility's procedures for such transfer. However,
although delivery of Shares may be effected through book-entry transfer, either
the Letter of Transmittal (or facsimile thereof), properly completed and duly
executed, together with any required signature guarantees, or an Agent's Message
in lieu of the Letter of Transmittal, and any other required documents, must, in
any case, be transmitted to and received by the Depositary at one of its
addresses set forth on the back cover of this Offer to Purchase by the
Expiration Date, or the tendering shareholder must comply with the guaranteed
delivery procedures described below. If the Distribution Date occurs, the
Depositary will also make a request to establish an account with respect to the
Rights at each of the Book-Entry Transfer Facilities, but no assurance can be
given that book-entry transfer of Rights will be available. If book-entry
transfer of Rights is available, the foregoing book-entry transfer procedures
will also apply to Rights. If book-entry transfer of Rights is not available and
the Distribution Date occurs, a tendering shareholder will be required to tender
Rights by means of physical delivery to the Depositary of certificates for
Rights (in which event references in this Offer to Purchase to Book-Entry
Confirmations with respect to Rights will be inapplicable). The confirmation of
a book-entry transfer of Shares or Rights into the Depositary's account at a
Book-Entry Transfer Facility as described above is referred to herein as a
"Book-Entry Confirmation." DELIVERY OF DOCUMENTS TO A BOOK-ENTRY TRANSFER
FACILITY IN ACCORDANCE WITH SUCH BOOK-ENTRY TRANSFER FACILITY'S PROCEDURES DOES
NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
THE METHOD OF DELIVERY OF SHARES, RIGHTS, THE LETTER OF TRANSMITTAL AND ALL
OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH ANY BOOK-ENTRY TRANSFER
FACILITY, IS AT THE ELECTION AND RISK OF THE TENDERING SHAREHOLDER. SHARES WILL
BE DEEMED DELIVERED ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY (INCLUDING, IN
THE CASE OF A BOOK-ENTRY TRANSFER, BY BOOK-ENTRY CONFIRMATION). IF DELIVERY IS
BY MAIL, IT IS RECOMMENDED THAT THE SHAREHOLDER USE PROPERLY INSURED REGISTERED
MAIL WITH RETURN RECEIPT REQUESTED. IN ALL CASES, SUFFICIENT TIME SHOULD BE
ALLOWED TO ENSURE TIMELY DELIVERY.
SIGNATURE GUARANTEES. Except as otherwise provided below, all signatures on
a Letter of Transmittal must be guaranteed by a financial institution (including
most commercial banks, savings and loan associations and brokerage houses) that
is a participant in the Security Transfer Agents Medallion Program, the New York
Stock Exchange Medallion Signature Guarantee Program or the Stock Exchange
Medallion Program (an "Eligible Institution"). Signatures on a Letter of
Transmittal need not be guaranteed (a) if the Letter of Transmittal is signed by
the registered holders (which term, for purposes of this section, includes any
participant in any of the Book-Entry Transfer Facilities' systems whose name
appears on a security position listing as the owner of the Shares or Rights) of
Shares and Rights tendered therewith and such registered holder has not
completed the box entitled "Special Payment Instructions" or the box entitled
"Special Delivery Instructions" on the Letter of Transmittal or (b) if such
Shares and Rights are tendered for the account of an Eligible Institution. See
Instructions 1 and 5 of the Letter of Transmittal. If the certificates for
Shares or Rights are registered in the name of a person other than the signer of
the Letter of Transmittal, or if payment is to be made or certificates for
Shares or Rights not tendered or not accepted for payment are to be returned to
a person other than the registered holder of
5
<PAGE>
the certificates surrendered, then the tendered certificates must be endorsed or
accompanied by appropriate stock powers, in either case signed exactly as the
name or names of the registered holders or owners appear on the certificates,
with the signatures on the certificates or stock powers guaranteed as described
above. See Instructions 1 and 5 of the Letter of Transmittal.
GUARANTEED DELIVERY. A shareholder who desires to tender Shares (or Rights,
if applicable) pursuant to the Offer and whose certificates for Shares (or
Rights, if applicable) are not immediately available (including because
certificates for Rights have not yet been distributed by the Rights Agent), or
who cannot comply with the procedure for book-entry transfer on a timely basis,
or who cannot deliver all required documents to the Depositary prior to the
Expiration Date, may tender such Shares (and/or Rights, if applicable) by
following all of the procedures set forth below:
(i) such tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form provided by the Purchaser, is received
by the Depositary (as provided below) prior to the Expiration Date; and
(iii) the certificates for all tendered Shares and/or Rights, in proper
form for transfer (or a Book-Entry Confirmation with respect to all such
Shares and/or Rights), together with a properly completed and duly executed
Letter of Transmittal (or facsimile thereof), with any required signature
guarantees (or, in the case of a book-entry transfer, an Agent's Message in
lieu of the Letter of Transmittal), and any other required documents, are
received by the Depositary within (a) in the case of Shares, three trading
days after the date of execution of such Notice of Guaranteed Delivery or
(b) in the case of Rights, a period ending on the later of (1) three trading
days after the date of execution of such Notice of Guaranteed Delivery or
(2) three trading days after the date certificates for Rights are
distributed to shareholders by the Rights Agent. A "trading day" is any day
on which the New York Stock Exchange (the "NYSE") is open for business.
The Notice of Guaranteed Delivery may be delivered by hand to the Depositary
or transmitted by facsimile transmission or mail to the Depositary and must
include a guarantee by an Eligible Institution in the form set forth in such
Notice of Guaranteed Delivery.
OTHER REQUIREMENTS. Notwithstanding any provision hereof, payment for
Shares accepted for payment pursuant to the Offer will in all cases be made only
after timely receipt by the Depositary of (a) certificates for (or a timely
Book-Entry Confirmation with respect to) such Shares and, if the Distribution
Date occurs, certificates for (or a timely Book-Entry Confirmation, if
available, with respect to) the associated Rights (unless the Purchaser elects
to make payment for such Shares pending receipt of the certificates for, or a
Book-Entry Confirmation with respect to, such Rights as described above), (b) a
Letter of Transmittal (or facsimile thereof), properly completed and duly
executed, with any required signature guarantees (or, in the case of a
book-entry transfer, an Agent's Message in lieu of the Letter of Transmittal)
and (c) any other documents required by the Letter of Transmittal. Accordingly,
tendering shareholders may be paid at different times depending upon when
certificates for Shares (or Rights) or Book-Entry Confirmations with respect to
Shares (or Rights, if available) are actually received by the Depositary. UNDER
NO CIRCUMSTANCES WILL INTEREST ON THE PURCHASE PRICE OF THE SHARES BE PAID BY
THE PURCHASER, REGARDLESS OF ANY EXTENSION OF THE OFFER OR ANY DELAY IN MAKING
SUCH PAYMENT.
TENDER CONSTITUTES ON AGREEMENT. The valid tender of Shares and, if
applicable, Rights pursuant to one of the procedures described above will
constitute a binding agreement between the tendering shareholder and the
Purchaser upon the terms and subject to the conditions of the Offer.
APPOINTMENT. By executing a Letter of Transmittal as set forth above, the
tendering shareholder irrevocably appoints designees of the Purchaser as such
shareholder's proxies, each with full power of substitution, to the full extent
of such shareholder's rights with respect to the Shares tendered by such
6
<PAGE>
shareholder and accepted for payment by the Purchaser and with respect to any
and all other Shares or other securities issued or issuable in respect of such
Shares on or after June 11, 1997. All such proxies will be considered coupled
with an interest in the tendered Shares and Rights. Such appointment is
effective when, and only to the extent that, the Purchaser deposits the payment
for such Shares with the Depositary. Upon the effectiveness of such appointment,
all prior powers of attorney, proxies and consents given by such shareholder
will be revoked, and no subsequent powers of attorney, proxies and consents may
be given (and, if given, will not be deemed effective). The Purchaser's
designees will, with respect to the Shares for which the appointment is
effective, be empowered to exercise all voting and other rights of such
shareholder as they, in their sole discretion, may deem proper at any annual,
special or adjourned meeting of the shareholders of the Company, by written
consent in lieu of any such meeting or otherwise. The Purchaser reserves the
right to require that, in order for Shares to be deemed validly tendered,
immediately upon the Purchaser's payment for such Shares, the Purchaser must be
able to exercise full voting rights with respect to such Shares.
DETERMINATION OF VALIDITY. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance of any tender of Shares
or Rights will be determined by the Purchaser in its sole discretion, which
determination will be final and binding. The Purchaser reserves the absolute
right to reject any and all tenders determined by it not to be in proper form or
the acceptance for payment of or payment for which may, in the opinion of the
Purchaser's counsel, be unlawful. The Purchaser also reserves the absolute right
to waive any defect or irregularity in the tender of any Shares or Rights of any
particular shareholder whether or not similar defects or irregularities are
waived in the case of other shareholders. No tender of Shares or Rights will be
deemed to have been validly made until all defects and irregularities relating
thereto have been cured or waived. None of the Purchaser, the Depositary, the
Information Agent, the Dealer Manager or any other person will be under any duty
to give notification of any defects or irregularities in tenders or incur any
liability for failure to give any such notification. The Purchaser's
interpretation of the terms and conditions of the Offer (including the Letter of
Transmittal and Instructions thereto) will be final and binding.
BACKUP WITHHOLDING. In order to avoid "backup withholding" of Federal
income tax on payments of cash pursuant to the Offer, a shareholder surrendering
Shares in the Offer must, unless an exemption applies, provide the Depositary
with such shareholder's correct taxpayer identification number ("TIN") on a
Substitute Form W-9 and certify under penalties of perjury that such TIN is
correct and that such shareholder is not subject to backup withholding. If a
shareholder does not provide such shareholder's correct TIN or fails to provide
the certifications described above, the Internal Revenue Service (the "IRS") may
impose a penalty on such shareholder and payment of cash to such shareholder
pursuant to the Offer may be subject to backup withholding of 31%. All
shareholders surrendering Shares pursuant to the Offer should complete and sign
the main signature form and the Substitute Form W-9 included as part of the
Letter of Transmittal to provide the information and certification necessary to
avoid backup withholding (unless an applicable exemption exists and is proved in
a manner satisfactory to the Purchaser and the Depositary). Certain shareholders
(including, among others, all corporations and certain foreign individuals and
entities) are not subject to backup withholding. Non-corporate foreign
shareholders should complete and sign the main signature form and a Form W-8,
Certificate of Foreign Status, a copy of which may be obtained from the
Depositary, in order to avoid backup withholding. See Instruction 9 to the
Letter of Transmittal.
4. WITHDRAWAL RIGHTS. Tenders of Shares made pursuant to the Offer are
irrevocable except that Shares tendered pursuant to the Offer may be withdrawn
at any time prior to the Expiration Date and, unless theretofore accepted for
payment by the Purchaser pursuant to the Offer, may also be withdrawn at any
time after August 17, 1997.
To be effective, a written, telegraphic, telex or facsimile transmission
notice of withdrawal must be timely received by the Depositary at one of its
addresses set forth on the back cover of this Offer to
7
<PAGE>
Purchase. Any notice of withdrawal must specify the name of the person having
tendered the Shares to be withdrawn, the number of Shares to be withdrawn and
the names in which the certificate(s) evidencing the Shares to be withdrawn are
registered, if different from that of the person who tendered such Shares. The
signature(s) on the notice of withdrawal must be guaranteed by an Eligible
Institution, unless such Shares have been tendered for the account of any
Eligible Institution. If Shares have been tendered pursuant to the procedures
for book-entry tender as set forth in Section 3, any notice of withdrawal must
specify the name and number of the account at the Depository Institution to be
credited with the withdrawn Shares. If certificates have been delivered or
otherwise identified to the Depositary, the name of the registered holder and
the serial numbers of the particular certificates evidencing the Shares
withdrawn must also be furnished to the Depositary as aforesaid prior to the
physical release of such certificates. All questions as to the form and validity
(including time of receipt) of any notice of withdrawal will be determined by
the Purchaser, in its sole discretion, which determination shall be final and
binding. None of the Purchaser, Thyssen, the Dealer Manager, the Depositary, the
Information Agent, or any other person will be under any duty to give
notification of any defects or irregularities in any notice of withdrawal or
incur an liability for failure to give such notification. Any Shares properly
withdrawn will be deemed not to have been validly tendered for purposes of the
Offer. However, withdrawn Shares may be retendered by following one of the
procedures descried in Section 3 at any time prior to the Expiration Date.
If the Purchaser extends the Offer, is delayed in its acceptance for payment
of Shares, or is unable to accept for payment Shares pursuant to the Offer, for
any reason, then, without prejudice to the Purchaser's rights under this Offer,
the Depositary may, nevertheless, on behalf of the Purchaser, retain tendered
Shares, and such Shares may not be withdrawn except to the extent that tendering
shareholders are entitled to withdrawal rights as set forth in this Section 4.
5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES. Sales of Shares pursuant to the
Offer and the exchange of Shares for cash pursuant to the Merger will be taxable
transactions for Federal income tax purposes and may also be taxable under
applicable state, local and other tax laws. For Federal income tax purposes, a
shareholder whose Shares are purchased pursuant to the Offer or who receives
cash as a result of the Merger will realize gain or loss equal to the difference
between the adjusted basis of the Shares sold or exchanged and the amount of
cash received therefor. Such gain or loss will be capital gain or loss if the
Shares are held as capital assets by the shareholder.
THE INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL
INFORMATION ONLY AND MAY NOT BE APPLICABLE TO SHAREHOLDERS IN SPECIAL SITUATIONS
SUCH AS SHAREHOLDERS WHO RECEIVED THEIR SHARES UPON THE EXERCISE OF EMPLOYEE
STOCK OPTIONS OR OTHERWISE AS COMPENSATION AND SHAREHOLDERS WHO ARE NOT UNITED
STATES PERSONS. SHAREHOLDERS SHOULD CONSULT THEIR OWN TAX ADVISORS WITH RESPECT
TO THE SPECIFIC TAX CONSEQUENCES TO THEM OF THE OFFER AND THE MERGER, INCLUDING
THE APPLICATION AND EFFECT OF STATE, LOCAL, FOREIGN OR OTHER TAX LAWS.
8
<PAGE>
6. PRICE RANGE OF SHARES; DIVIDENDS. The Shares are listed on The Nasdaq
Stock Market, Inc.'s ("Nasdaq") National Market (the "Nasdaq NM") under the
symbol GIDL. The following table sets forth, for the calendar quarters
indicated, the high and low last reported sales prices for the Common Stock on
the Nasdaq NM and the amount of cash dividends paid per share, based upon public
sources:
<TABLE>
<CAPTION>
COMMON STOCK
- ---------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
CALENDAR YEAR High Low
- ------------------------------------------------------------------------------- -------- --------
Fiscal Year Ended December 31, 1995:
First Quarter................................................................ $ 17 1/4 $ 14 5/8
Second Quarter............................................................... 18 7/8 15 1/8
Third Quarter................................................................ 18 1/2 16
Fourth Quarter............................................................... 17 3/8 14 7/8
Fiscal Year Ended December 31, 1996:
First Quarter................................................................ 19 9/16 14 3/4
Second Quarter............................................................... 19 1/8 16 1/8
Third Quarter................................................................ 16 10 3/4
Fourth Quarter............................................................... 14 11 3/8
Fiscal Year Ended December 31, 1997:
First Quarter................................................................ 14 7/8 12 47/64
Second quarter (through June 17, 1997)....................................... 20 7/8 12 3/4
<CAPTION>
COMMON STOCK
- -------------------------------------------------------------------------------
<S> <C>
Cash
CALENDAR YEAR Dividend Paid
- ------------------------------------------------------------------------------- -----------------
Fiscal Year Ended December 31, 1995:
First Quarter................................................................ $ .03
Second Quarter............................................................... .03
Third Quarter................................................................ .03
Fourth Quarter............................................................... .03
Fiscal Year Ended December 31, 1996:
First Quarter................................................................ .03
Second Quarter............................................................... .03
Third Quarter................................................................ .03
Fourth Quarter............................................................... .03
Fiscal Year Ended December 31, 1997:
First Quarter................................................................ .03
Second quarter (through June 17, 1997)....................................... .03
</TABLE>
The Rights trade together with the Common Stock. On June 11, 1997, the last
full trading day prior to the public announcement of the terms of the Offer and
the Merger, the reported closing price on the Nasdaq NM was $19. On June 17,
1997, the last full trading day prior to the commencement of the Offer, the
reported closing price on the Nasdaq NM was $20 11/16. SHAREHOLDERS ARE URGED TO
OBTAIN CURRENT MARKET QUOTATIONS FOR THE SHARES.
7. CERTAIN INFORMATION CONCERNING THE COMPANY The Company is a Wisconsin
corporation with its principal offices at 142 Doty Street, Fond du Lac,
Wisconsin 54935. The following description of the Company's business has been
taken from the Company's Form 10-K for the fiscal year ended December 31, 1996:
Giddings & Lewis, Inc. (the "Company") is a leading global designer and
producer of highly-engineered, high-precision, industrial automation
systems, including automated machine tools, smart manufacturing systems,
flexible transfer lines, assembly automation systems, measuring systems,
industrial controls, and related products and services. The Company's
products are supplied primarily to the automotive, construction,
aerospace, defense, appliance, energy and electronics industries and are
manufactured at the Company's thirteen facilities located in the United
States, Canada, England and Germany.
SELECTED CONSOLIDATED FINANCIAL DATA. Set forth below is certain summary
consolidated financial information for the Company's last three fiscal years
ended December 31, 1996 as contained in the Company 10-K and for the three
months ended March 31, 1997 as contained in the Company's Quarterly Report on
Form 10-Q for the quarter ended March 31, 1997 (the "Company 10-Q"). More
comprehensive financial information is included in such reports (including
management's discussion and analysis of financial condition and results of
operation) and other documents filed by the Company with the Commission, and the
following summary is qualified in its entirety by reference to such reports and
other documents and all of the financial information and notes contained
therein. Copies of such reports and other documents may be examined at or
obtained from the Commission or from Nasdaq in the manner set forth below under
"Available Information".
9
<PAGE>
GIDDINGS & LEWIS, INC.
SELECTED CONSOLIDATED FINANCIAL INFORMATION
(IN THOUSANDS, EXCEPT PER SHARE DATA)
<TABLE>
<CAPTION>
THREE MONTHS ENDED
FISCAL YEAR ENDED DECEMBER 31, ----------------------
----------------------------------- MARCH 30, MARCH 31,
1996 1995 1994 1997 1996
----------- ---------- ---------- ---------- ----------
<S> <C> <C> <C> <C> <C>
(UNAUDITED)
INCOME STATEMENT DATA:
Net sales....................................... $ 762,993 $ 730,552 $ 619,471 $ 147,617 $ 192,420
Operating income................................ (24,315) 38,174 75,826 13,791 16,811
Net income (loss)............................... (12,542) 6,455 47,880 7,379 10,417
Net income (loss) per Share..................... $ (0.37) $ 0.19 $ 1.40 $ 0.22 $ 0.30
Average number of Shares outstanding............ 34,025 34,398 34,284 32,883 34,527
</TABLE>
<TABLE>
<CAPTION>
AT DECEMBER 31,
---------------------- AT MARCH 30, AT MARCH 31,
1996 1995 1997 1996
---------- ---------- ------------ ------------
<S> <C> <C> <C> <C>
BALANCE SHEET DATA:
Total current assets..................................... $ 474,611 $ 477,787 $ 426,372 $ 474,611
Total assets............................................. 811,400 817,591 761,712 811,400
Total current liabilities................................ 213,305 182,327 178,589 213,305
Long-term debt........................................... 100,000 100,000 100,000 100,000
Total shareholders' equity............................... 460,823 492,541 494,543 483,057
</TABLE>
In connection with Thyssen's review of the Company and in the course of the
negotiations between the Company and Thyssen described in Section 10, the
Company provided Thyssen with certain business and financial information which
Thyssen and Purchaser believe is not publicly available. The Company provided
Thyssen with financial forecasts for the year ending December 31, 1997 and
projections of results of operations for each of the following four years. For
the year ending December 31, 1997, the Company forecasted a decline in net sales
of more than 15% from the net sales for the fiscal year ended December 31, 1996
and forecasted net income of slightly less than the net income for each of the
fiscal years ended December 31, 1995 and December 31, 1996 (before taking into
account the after-tax charges and adjustments of $29.0 million in 1995 and $50.1
million in 1996). The Company's projections of results of operations for each of
the following four years beginning with the year ended December 31, 1998 showed
a compounded annual growth rate of approximately 13% in net sales and
approximately 33% in net income from such 1997 forecasts.
THYSSEN DID NOT RELY ON SUCH FORECASTS IN FORMULATING ITS OFFER TO ACQUIRE
THE COMPANY. IN PARTICULAR, THYSSEN DISCOUNTED THE COMPANY'S PROJECTIONS OF
RESULTS OF OPERATIONS FOR EACH OF THE FOUR YEARS BEGINNING WITH THE YEAR ENDING
DECEMBER 31, 1998 IN ITS OWN ANALYSIS OF THE COMPANY'S FUTURE PROSPECTS. THE
FOREGOING SUMMARY OF SUCH FORECASTS IS BEING INCLUDED IN THIS OFFER TO PURCHASE
ONLY BECAUSE SUCH INFORMATION WAS MADE AVAILABLE TO THYSSEN BY THE COMPANY.
PROJECTED FINANCIAL INFORMATION OF THE TYPE SET FORTH IN THE PRECEDING PARAGRAPH
IS BASED ON ESTIMATES AND ASSUMPTIONS THAT ARE INHERENTLY SUBJECT TO SIGNIFICANT
ECONOMIC AND COMPETITIVE UNCERTAINTIES AND CONTINGENCIES, ALL OF WHICH ARE
DIFFICULT TO PREDICT AND MANY OF WHICH ARE BEYOND THE COMPANY'S CONTROL.
ACCORDINGLY, THERE CAN BE NO ASSURANCE THAT THE PROJECTED RESULTS WILL BE
REALIZED OR THAT ACTUAL RESULTS WILL NOT BE SIGNIFICANTLY DIFFERENT THAT THOSE
SET FORTH ABOVE. IN ADDITION, THE COMPANY'S PROJECTIONS WERE NOT PREPARED WITH A
VIEW TO PUBLIC DISCLOSURE OR COMPLIANCE WITH THE GUIDELINES ESTABLISHED BY THE
AMERICAN INSTITUTE OF CERTIFIED PUBLIC ACCOUNTANTS REGARDING PROJECTIONS AND
FORECASTS.
10
<PAGE>
THE RIGHTS. Set forth below is a summary description of the publicly
available information concerning the Rights.
Pursuant to the Merger Agreement, the Company has amended the Rights
Agreement so that Thyssen will not be deemed an Acquiring Person (as defined
below) and the Rights will not separate from the Shares as a result of entry
into the Merger Agreement, commencement or consummation of the Offer or the
Merger, or the other transactions contemplated by the Merger Agreement.
According to the Company's Registration Statement on Form 8-A, dated August
23, 1995 (the "Company 8-A") , the Board of Directors of the Company declared a
dividend on August 23, 1995 of one Right for each outstanding Common Share. The
dividend was payable on September 8, 1995 to the shareholders of record on that
date (the "Record Date"). Each Right entitles the registered holder to purchase
from the Company one one-hundredth of a share of Class A Preferred Stock, Series
B, $.10 par value (the "Preferred Shares"), of the Company at a price of $60 per
one one-hundredth of a Preferred Share, subject to adjustment (the "Purchase
Price"). The description and terms of the Rights are set forth in the Rights
Agreement between the Company and the Rights Agent, which was included as an
exhibit to the Company 8-A. The following information concerning the Rights and
the Rights Agreement is taken from or is based upon information presented in the
Company 8-A.
Until the earlier to occur of (i) 10 days following a public announcement
that a person or group of affiliated or associated persons (other than the
Company, a subsidiary of the Company or an employee benefit plan of the Company
or a subsidiary) (an "Acquiring Person") has acquired beneficial ownership of
20% or more of the outstanding Shares (the "Shares Acquisition Date") or (ii) 10
business days (or such later date as may be determined by action of the
Company's Board of Directors prior to such time as any person becomes an
Acquiring Person) following the commencement of, or announcement of an intention
to make, a tender offer or exchange offer the consummation of which would result
in the beneficial ownership by a person or group (other than the Company, a
subsidiary of the Company or an employee benefit plan of the Company or a
subsidiary) of 20% or more of such outstanding Shares (the earlier of such dates
being called the "Distribution Date"), the Rights will be evidenced, with
respect to any of the Share certificates outstanding as of the Record Date, by
such Share certificate.
The Rights Agreement provides that, until the Distribution Date, the Rights
will be transferred with and only with the Shares. Until the Distribution Date
(or earlier redemption or expiration of the Rights), the surrender for transfer
of any certificates for Shares, outstanding as of the Record Date, will also
constitute the transfer of the Rights associated with the Shares represented by
such certificate. As soon as practicable following the Distribution Date,
separate certificates evidencing the Rights ("Right Certificates") are to be
mailed to holders of record of Shares as of the close of business on the
Distribution Date and such separate Right Certificates alone will evidence the
Rights.
The Rights are not exercisable until the Distribution Date. The Rights will
expire on September 8, 2005 (the "Final Expiration Date"), unless the Rights are
earlier redeemed or exchanged by the Company, in each case as described below.
The Purchase Price payable, and the number of Preferred Shares or other
securities or property issuable, upon exercise of the Rights are subject to
adjustment from time to time to prevent dilution (i) in the event of a stock
dividend on, or a subdivision, combination or reclassification of, the Preferred
Shares, (ii) upon the grant to holders of the Preferred Shares of certain rights
or warrants to subscribe for or purchase Preferred Shares at a price, or
securities convertible into Preferred Shares with a conversion price, less than
the then current market price of the Preferred Shares or (iii) upon the
distribution to holders of the Preferred Shares of evidences of indebtedness or
assets (excluding regular quarterly cash dividends or dividends payable in
Preferred Shares) or of subscription rights or warrants (other than those
referred to above).
The number of outstanding Rights and the number of one one-hundredths of a
Preferred Share issuable upon exercise of each Right are also subject to
adjustment in the event of a stock split of the
11
<PAGE>
Shares or a stock dividend on the Shares payable in Shares or subdivisions,
consolidations or combinations of the Shares occurring, in any such case, prior
to the Distribution Date.
Preferred Shares purchasable upon the exercise of Rights will not be
redeemable. Each Preferred Share will be entitled to a minimum preferential
quarterly dividend payment of $1.00 per share but will be entitled to an
aggregate dividend of 100 times the dividend declared per Share. In the event of
liquidation, the holders of the Preferred Shares will be entitled to a minimum
preferential liquidation payment of $100 per share but will be entitled to an
aggregate payment of 100 times the payment made per Share. Each Preferred Share
will have 100 votes, voting together with the Shares. Finally, in the event of
any merger, consolidation or other transaction in which Shares are exchanged,
each Preferred Share will be entitled to receive 100 times the amount received
per Share.
In the event that (i) any person becomes an Acquiring Person, (ii) the
Company is the surviving corporation in a merger with an Acquiring Person and
the Shares are not changed or exchanged, (iii) an Acquiring Person engages in
one of a number of types of transactions specified in the Rights Agreement, or
(iv) during such time as there is an Acquiring Person, an event occurs which
results in such Acquiring Person's ownership interest being increased by more
than 1% (the events described in clauses (i)-(iv) are herein referred to as
"Flip-In Events"), each holder of a Right will thereafter have the right to
receive upon exercise that number of Shares (or, in certain circumstances cash,
property or other securities of the Company or a reduction in the Purchase
Price) having a market value (calculated as provided under the Rights Agreement)
of two times the then current Purchase Price. Notwithstanding any of the
foregoing, following the occurrence of any Flip-In Event all Rights that are, or
(under certain circumstances specified in the Rights Agreement) were, or
subsequently become beneficially owned by an Acquiring Person, related persons
and transferees will be null and void.
In the event that, at any time following the Shares Acquisition Date, (i)
the Company is acquired in a merger or other business combination transaction or
(ii) 50% or more of its consolidated assets or earning power are sold (the
events described in clauses (i) and (ii) are herein referred to as "Flip-Over
Events"), proper provision will be made so that each holder of a Right will
thereafter have the right to receive, upon the exercise thereof at the then
current Purchase Price, that number of shares of common stock of the acquiring
company which at the time of such transaction will have a market value
(calculated as provided under the Rights Agreement) of two times the then
current Purchase Price.
With certain exceptions, no adjustment in the Purchase Price will be
required until cumulative adjustments require an adjustment of at least 1% in
such Purchase Price. No fractional Preferred Shares will be issued (other than
fractions which are integral multiples of one one-hundredth of a Preferred
Share, which may, at the election of the Company, be evidenced by depositary
receipts). In lieu thereof, an adjustment in cash will be made based on the
market price of the Preferred Shares on the last trading day prior to the date
of exercise.
The Purchase Price is payable by certified check, cashier's check, bank
draft or money order or, if so provided by the Company, the Purchase Price
following the occurrence of a Flip-In Event and until the first occurrence of a
Flip-Over Event may be paid in Shares having an equivalent value.
At any time after a person becomes an Acquiring Person and prior to the
acquisition by any Acquiring Person of 50% or more of the outstanding Shares,
the Board of Directors of the Company may exchange the Rights (other than Rights
owned by any Acquiring Person which have become void), in whole or in part, at
an exchange ratio of one share of Common Stock, or one one-hundredth of a
Preferred Share (or of a share of a class or series of the Company's preferred
stock having equivalent rights, preferences and privileges), per Right (subject
to adjustment).
At any time prior to a person becoming an Acquiring Person, the Board of
Directors of the Company may redeem the Rights in whole, but not in part, at a
price of $.01 per Right (the "Redemption Price"). The redemption of the Rights
may be made effective at such time, on such basis and with such conditions as
the Board of Directors in its sole discretion may establish. Immediately upon
any redemption of the
12
<PAGE>
Rights, the right to exercise the Rights will terminate and the only right of
the holders of Rights will be to receive the Redemption Price.
Other than provisions relating to principal economic terms of the Rights,
the terms of the Rights may be amended by the Board of Directors of the Company
without the consent of the holders of the Rights, including an amendment to
lower the threshold for exercisability of the Rights from 20% to not less than
10%, with certain exceptions for any person then beneficially owning a
percentage of the number of Shares then outstanding equal to or in excess of the
new threshold, except that from and after the Distribution Date no such
amendment may adversely affect the interests of the holders of the Rights.
Until a Right is exercised, the holder thereof, as such, will have no rights
as a shareholder of the Company, including, without limitation, the right to
vote or to receive dividends.
The Company 8-A states that while distribution of the Rights will not
constitute a taxable event to the shareholders or the Company, the shareholders
may, depending on the circumstances, recognize taxable income in the event that
the Rights become exercisable for Preferred Shares (or other consideration) of
the Company or for common stock of the acquiring company, as set forth above.
The Company has entered into an amendment to the Rights Agreement to make it
inapplicable to the Offer, the Merger and the other transactions contemplated by
the Merger Agreement.
The foregoing summary of the Rights Agreement does not purport to be
complete and is qualified in its entirety by reference to the Rights Agreement.
The Rights Agreement should be available for inspection and copies thereof
should be obtainable in the manner set forth below under "Available
Information".
COMPANY INFORMATION. Except as otherwise set forth herein, the information
concerning the Company contained in this Offer to Purchase has been taken from
or based upon publicly available documents and records on file with the
Commission and other public sources and is qualified in its entirety by
reference thereto. Although Thyssen has no knowledge that would indicate that
any statements contained herein based on such documents and records are untrue,
Thyssen cannot take responsibility for the accuracy or completeness of the
information contained in such documents and records, or for any failure by the
Company to disclose events which may have occurred or may affect the
significance or accuracy of any such information but which are unknown to
Thyssen.
AVAILABLE INFORMATION. The Company is subject to the information and
reporting requirements of the Exchange Act and in accordance therewith is
obligated to file reports and other information with the Commission relating to
its business, financial condition and other matters. Information, as of
particular dates, concerning the Company's directors and officers, their
remuneration, stock options granted to them, the principal holders of the
Company's securities, any material interests of such persons in transactions
with the Company and other matters is required to be disclosed in proxy
statements distributed to the Company's shareholders and filed with the
Commission. Such reports, proxy statements and other information are available
for inspection and copying at the public reference facilities of the Commission
located at Room 1024, Judiciary Plaza, 450 Fifth Street, N.W., Washington, D.C.
20549, and at the Commission's regional offices at Seven World Trade Center,
13th Floor, New York, New York 10048 and Citicorp Center, 500 West Madison
Street, Suite 1400, Chicago, Illinois 60661. The Commission also maintains an
Internet site on the World Wide Web at /http://www.sec.gov> that contains
reports, proxy statements and other information. The information also should be
available at The Nasdaq Stock Market, Inc., 1735 K Street, N.W., Washington,
D.C. 20006.
8. CERTAIN INFORMATION CONCERNING PURCHASER AND THYSSEN. Purchaser is a
newly incorporated Delaware corporation organized in connection with the Offer
and the Merger and to date has engaged in no activities other than those
incident to its formation and the commencement of the Offer. Purchaser is an
indirect wholly owned subsidiary of Thyssen. The principal offices of Purchaser
are located at 3155 West Big Beaver Road, Troy, Michigan. Until immediately
prior to the time that Purchaser will purchase Shares
13
<PAGE>
pursuant to the Offer, it is not anticipated that Purchaser will have any
significant assets or liabilities or engage in activities other than those
incident to its formation and capitalization and the transactions contemplated
by the Offer and the Merger. Because Purchaser is newly formed and has minimal
assets and capitalization, no meaningful financial information regarding
Purchaser is available.
Thyssen is a company organized under the laws of the Federal Republic of
Germany (registered in Duisburg), with its principal office at
August-Thyssen-Strabe 1, 40211 Dusseldorf, Germany. Thyssen is the holding
company of the Thyssen Group. Thyssen owns no Shares. Through its subsidiaries,
Thyssen is engaged in three areas of business: Capital Goods and Manufactured
Products, Trading and Services and Steel. In addition, Thyssen is engaged in
satellite and telecommunications services and has important real estate
holdings. The Capital Goods and Manufactured Products Division is engaged in the
production of components and systems for the automotive industry, the design and
manufacture of elevators and escalators, the production of building and
construction related products and systems, providing systems and plant
engineering services and the design, building, repair and service of ships. The
Trading and Services Division is engaged in recycling of steel, metals and
building materials; numerous waste management services; trading in raw materials
such as metals and alloys; and trading and cutting to size of production
materials like steel, nonferrous metals and plastics. Trading and Services'
business also includes building and construction products such as plumbing and
heating equipment, materials for excavation and subsurface construction,
scaffolding and formwork, petroleum trading and international forwarding and
logistics involving all modes of transportation and the implementation of
turnkey construction projects and industrial complexes throughout the world, as
well as technical maintenance. The Steel Division engages in hot metal
desulfurization, ladle metallurgy installation, and production of various steel
products (e.g. Hot Strip, Plate, Sheet/Coated Products, Tailored Products,
Tin-/Block Plate, Magnetic Materials, Steel Service, Building Elements,
Semi-Finished/Bar/Forged Products, Permanent-Way Material/Sectional Steel, Wire
Rod, Wire Processing).
Set forth below is a summary of certain selected financial information with
respect to Thyssen for the fiscal years ended September 30, 1995 and September
30, 1996.
Additional information concerning Thyssen is set forth in Thyssen's Annual
Report for the fiscal year ended September 30, 1996. Such Annual Report has been
filed with the Commission and is available for inspection and copying at the
public reference facilities maintained by the Commission located at 450 Fifth
Street, N.W., Washington, D.C. 20549, and at the Commission's regional offices
at Seven World Trade Center, 13th Floor, New York, New York 10048 and Citicorp
Center, 500 West Madison Street, Suite 1400, Chicago, Illinois 60661. The
Commission also maintains an Internet site on the World Wide Web at /http://
www.sec.gov> that contains reports, proxy statements and other information.
Thyssen is not subject to the informational reporting requirements of the
Exchange Act, and, accordingly, does not file Exchange Act reports with the
Commission relating to its business, financial condition or other matters.
Thyssen's selected consolidated financial data included herein have been
prepared in accordance with the German Commercial Code ("Handelsgesetzbuch")
which represents generally accepted accounting principles in Germany ("German
GAAP"). German GAAP differs in certain significant respects from United States
generally accepted accounting principles ("U.S. GAAP"). Thyssen has not
determined its financial position or results of operations for any period under
U.S. GAAP. A summary of the significant differences between German accounting
principles and U.S. GAAP is set forth below under "--Summary of Certain
Significant Differences Between German and U.S. GAAP." Purchaser, however,
believes that the differences are not material to a decision by a holder of
Shares whether to sell, tender or hold any Shares because any such differences
would not affect the ability of Thyssen to pay for Shares to be acquired
pursuant to the Offer. The selected consolidated financial data is stated in
Deutsche Mark. On June 16, 1997, The Wall Street Journal reported that, as of
June 13, 1997 one U.S. dollar equaled 1.7355 Deutsche Mark.
14
<PAGE>
THYSSEN AKTIENGESELLSCHAFT
SELECTED FINANCIAL INFORMATION
(IN MILLIONS OF DEUTSCHE MARK, EXCEPT PER SHARE AMOUNTS)
<TABLE>
<CAPTION>
AT SEPTEMBER 30,
------------------------------
<S> <C> <C>
1995 1996
-------------- --------------
BALANCE SHEET DATA:
Total assets.................................................................... DM25,069.7 DM25,482.6
Equity.......................................................................... 5,405.0 5,850.2
Accruals........................................................................ 9,782.0 10,025.3
Liabilities..................................................................... 9,874.0 9,601.2
</TABLE>
<TABLE>
<CAPTION>
FOR THE FISCAL YEAR
ENDED SEPTEMBER 30,
------------------------------
<S> <C> <C>
1995 1996
-------------- --------------
INCOME STATEMENT DATA:
Net sales....................................................................... DM39,122.5 DM38,672.8
Pretax profit................................................................... 1,026.2 654.0
Net income...................................................................... 775.0 350.0
</TABLE>
The following represents, in the opinion of management of Thyssen, the
significant differences that would affect the determination of consolidated net
income and stockholders' equity of Thyssen for the periods for which the
consolidated financial statements have been presented herein.
GOODWILL AND BUSINESS ACQUISITIONS. In accordance with German GAAP, the
difference between the purchase price and fair value of net assets acquired as
part of a business combination (goodwill) may be charged directly to partners'
equity which has been practiced until 1992--or capitalized and amortized through
the statements of operations over its useful life, which has been practiced
since 1993 with an amortization period of 15 years. Under U.S. GAAP, goodwill
must be capitalized and amortized through the statement of operations over its
useful life not to exceed 40 years.
FIXED TANGIBLE ASSETS. In general, German companies depreciate fixed
tangible assets (property, plant and equipment) through the statement of
operations based upon depreciation rates prescribed by German tax law. Under
U.S. GAAP, tangible fixed assets are depreciated either on a straight-line or
accelerated basis through the statement of operations over their expected useful
life. Such differences would generally result in an entity reporting a lower net
book value for tangible fixed assets under German GAAP than under U.S. GAAP.
CAPITALIZATION OF INTEREST. Under German GAAP only under limited
circumstances is the capitalization of interest on capital expenditures
permitted. Under U.S. GAAP, interest incurred as part of the cost of
constructing fixed assets is required to be capitalized and amortized over the
life of the assets.
LEASING. U.S. GAAP contains prescriptive rules for determining whether a
lease must be accounted for as an operating or capital lease. Such rules differ
from those used in German GAAP.
PROVISIONS. Under U.S. GAAP, a provision may only be recorded for a
liability to a third-party that is probably and reasonably estimatable. Under
German GAAP, provisions are also permitted for uncertain liabilities and accrued
internal costs.
PENSIONS AND SIMILAR OBLIGATIONS. Under German GAAP, pension costs and
similar obligations including post retirement benefits are accrued over the
service lives of the employees based upon actuarial studies using the entry age
method as defined in the German tax code. U.S. GAAP requires that a different
actuarial method (the projected unit credit method) with different assumptions
be used.
15
<PAGE>
FOREIGN CURRENCY. Under German GAAP, receivables and payables stated in
foreign currency are translated at each balance sheet date into German local
currency at the lower of the currency exchange rate on the transaction date or
the balance sheet date. Under U.S. GAAP, assets and liabilities denominated in a
foreign currency are recorded at balance sheet rates with any resulting gain or
loss recognized in the income statement.
DEFERRED TAXES. Under German GAAP, deferred tax assets and liabilities are
generally recognized on a net basis and to the extent that the entity is in a
net deferred tax asset position the deferred tax asset is generally not
recognized. Further, the deferred tax benefit of net operating loss
carryforwards is generally not recognized until realized. Under U.S. GAAP,
deferred taxes are provided in the period of origination for all temporary
differences, including net operating loss carryforwards where it is more likely
than not that the tax benefit will be realized in future periods, based upon
enacted tax rates.
The name, citizenship, business address, principal occupation or employment,
and material positions held during the last five years for each of the directors
and executive officers of Purchaser and Thyssen are set forth in Schedule I
hereto.
None of Thyssen or Purchaser, nor, to the best of their knowledge, any of
the persons listed in Schedule I hereto nor any associate or majority-owned
subsidiary of any of the foregoing, beneficially owns or has a right to acquire
any equity securities of the Company. None of Thyssen or Purchaser nor, to the
best of their knowledge, any of the persons or entities referred to above, nor
any director, executive officer or subsidiary of any of the foregoing has
effected any transaction in such equity securities during the past 60 days.
Except as set forth in this Offer to Purchase, neither the Purchaser nor
Thyssen, nor, to the best of their knowledge, any of the persons listed in
Schedule I hereto, has any contract, arrangement, understanding or relationship
with any other person with respect to any securities of the Company, including,
but not limited to, any contract, arrangement, understanding or relationship
concerning the transfer or the voting of any such securities, joint ventures,
loan or option arrangements, puts or calls, guaranties of loans, guaranties
against loss or the giving or withholding of proxies. Except as set forth in
this Offer to Purchase, since January 1, 1994, there have been no contacts,
negotiations or transactions between any of Purchaser, Thyssen, or any of their
respective subsidiaries or, to the best knowledge of Thyssen and Purchaser, any
of the persons listed in Schedule I to this Offer to Purchase, on the one hand,
and the Company or its affiliates, on the other hand, concerning a merger,
consolidation or acquisition, tender offer or other acquisition of securities,
an election of directors or a sale or other transfer of a material amount of
assets. Except as set forth in this Offer to Purchase, neither Thyssen nor
Purchaser, nor, to the best of their knowledge, any of the persons listed on
Schedule I hereto, has since January 1, 1994 had any transaction with the
Company or any of its executive officers, directors or affiliates that would
require disclosure under the regulations of the Commission applicable to the
Offer.
9. FINANCING OF THE OFFER AND THE MERGER. The total amount of funds
required by Purchaser to consummate the Offer and the Merger is estimated to be
approximately $675,000,000, including related fees and expenses. Purchaser will
obtain all of such funds from Thyssen or one of Thyssen's affiliates. Thyssen
and its affiliates will provide such funds from working capital.
10. BACKGROUND OF THE OFFER; CONTACTS WITH THE COMPANY; THE MERGER
AGREEMENT. According to the Schedule 14D-9 filed by the Company with the
Commission on May 8, 1997, Marvin L. Isles, President and Chief Executive
Officer of the Company, was approached on April 21, 1997 by representatives of
Harnischfeger Industries, Inc. ("Harnischfeger") regarding a combination of
Harnischfeger and the Company. On April 25, 1997, management of the Company
informed Harnischfeger that the Company would not enter into negotiations
regarding a business combination unless Harnischfeger agreed to be bound by a
confidentiality agreement and a two-year standstill agreement. On the afternoon
of April 25,
16
<PAGE>
1997, Harnischfeger notified management of the Company of its intention to
commence a hostile tender offer and brought related suits against the Company
and certain of its directors.
On April 26, 1997, Mr. Isles contacted Dr. Dieter Vogel, Chairman of the
Executive Board of Thyssen regarding a potential business combination between
Thyssen and the Company. On April 30, 1997, Thyssen and the Company executed a
confidentiality agreement which included a two-year standstill restriction on
Thyssen's ability to purchase Shares without the prior approval of the Company.
On May 2, 1997 Mr. Isles, and representatives of the Company's financial
advisor, met in London, England with Dr. Vogel, Mr. Friedhelm Hoppe, a member of
the Executive Board of Thyssen Industries AG, and with representatives of Morgan
Stanley, financial advisor to Thyssen. Over the next few weeks, discussion
regarding a potential business combination between Thyssen and the Company
continued and Thyssen performed an analysis of the business and operations of
the Company.
Beginning on June 2, 1997, representatives of Thyssen and the Company and
their respective legal and financial advisors began negotiating the Merger
Agreement. Negotiations continued through June 11, 1997, at which point the
Merger Agreement was executed.
CONTACTS WITH THE COMPANY. Except as set forth in this Offer to Purchase,
none of the Purchaser, Thyssen or, to the best of their knowledge, any of the
persons listed in Schedule I hereto, or any associate or majority-owned
subsidiary of such persons, beneficially owns any equity security of the
Company, and none of the Purchaser, Thyssen, or to the best of their knowledge,
any of the other persons referred to above, or any of the respective directors,
executive officers or subsidiaries of any of the foregoing, has effected any
transaction in any equity security of the Company during the past 60 days.
From time to time, in the ordinary course of business, Thyssen makes
purchases from and sales to the Company of certain products, which transactions
are on terms and conditions customary for the industry and negotiated at arm's
length. Neither purchases by Thyssen from the Company nor sales by Thyssen to
the Company have exceeded $5 million in the aggregate in any of Thyssen's or the
Company's past three fiscal years.
Except as set forth in this Offer to Purchase, none of the Purchaser,
Thyssen, or, to the best of their knowledge, any of the persons listed in
Schedule I hereto, has any contract, arrangement, understanding or relationship
with any other person with respect to any securities of the Company, including,
without limitation, any contract, arrangement, understanding or relationship
concerning the transfer or the voting of any securities of the Company, joint
ventures, loan or option arrangements, puts or calls, guaranties of loans,
guaranties against loss or the giving or withholding of proxies. Except as set
forth in this Offer to Purchase, none of the Purchaser, Thyssen or, to the best
of their knowledge, any of the persons listed in Schedule I hereto has had any
transactions with the Company, or any of its executive officers, directors or
affiliates that would require reporting under the rules of the Commission.
Except as set forth in this Offer to Purchase, as of the date hereof, there
have been no contacts, negotiations or transactions between the Purchaser or
Thyssen, any of their respective subsidiaries, or, to the best of their
knowledge, any of the persons listed in Schedule I hereto, on the one hand, and
the Company or its executive officers, directors or affiliates, on the other
hand, concerning a merger, consolidation or acquisition, tender offer or other
acquisition of securities, election of directors, or a sale or other transfer of
a material amount of assets that would require reporting under the rules of the
Commission.
THE MERGER AGREEMENT
The following is a summary of the Merger Agreement, a copy of which is filed
as an Exhibit to the Schedule 14D-1 on file with the Commission. Such summary is
qualified in its entirety by reference to the Merger Agreement.
17
<PAGE>
THE OFFER. The Merger Agreement provides for the commencement of the Offer
no later than five business days after the initial public announcement of
Purchaser's intention to commence the Offer. The obligation of Purchaser to
accept for payment Shares tendered pursuant to the Offer is subject, among other
things, to the satisfaction of the Minimum Condition. Purchaser and Thyssen have
agreed that no change in the Offer may be made which decreases the price per
Share payable in the Offer, changes the form of consideration payable in the
Offer, reduces the maximum number of Shares to be purchased in the Offer,
reduces the Minimum Condition, imposes conditions to the Offer in addition to
those set forth in the Merger Agreement, or modifies or amends any terms of the
Offer in a manner adverse to the Company's shareholders. Purchaser may (and, at
the Company's request, if certain conditions are met, shall) extend the Offer on
one or more occasions for up to ten business days for each such extension beyond
the then scheduled expiration date until such time as the conditions to the
Offer are met or waived, if at the then scheduled expiration date of the Offer,
any of the conditions to Purchaser's obligation to accept for payment and pay
for the Shares shall not be satisfied or waived. Purchaser may also extend the
Offer without the Company's consent for not more than five business days beyond
the latest expiration date that would otherwise be permitted under the Merger
Agreement, if there have been insufficient shares tendered to effect the Merger
as a short-form merger without a meeting of the Company's shareholders.
BOARD CONTROL. The Merger Agreement provides that within two business days
after the purchase by Purchaser of Shares pursuant to the Offer, either (i) a
majority of the members of the Board of Directors of the Company shall resign,
and the remaining Board members shall fill the positions vacated with persons
designated by Thyssen, or (ii) the size of the Board of Directors of the Company
shall be expanded and vacant seats filled with persons designated by Thyssen so
that, in either case, a majority of the members of the Board of Directors of the
Company are persons designated by Thyssen.
THE MERGER. The Merger Agreement provides that, upon the terms and subject
to the conditions thereof, and in accordance with Delaware and Wisconsin Law, at
the Effective Time, Purchaser shall be merged with and into the Company. As a
result of the Merger, the separate corporate existence of Purchaser will cease
and the Company will continue as the Surviving Corporation (the "Surviving
Corporation") and will become an indirect wholly owned subsidiary of Thyssen.
Upon consummation of the Merger, each issued and then outstanding Share (other
than any Shares held in the treasury of the Company, or owned by Purchaser,
Thyssen or any direct or indirect wholly owned subsidiary of Thyssen or of the
Company) shall be automatically converted into, and exchanged for, the right to
receive $21.00 in cash (the "Merger Consideration").
The Merger Agreement provides that the directors of Purchaser immediately
prior to the Effective Time will be the initial directors of the Surviving
Corporation and that the officers of the Company immediately prior to the
Effective Time will be the initial officers of the Surviving Corporation. The
Merger Agreement provides that, at the Effective Time, the Certificate of
Incorporation of Purchaser will be the Articles of Incorporation of the
Surviving Corporation. The Merger Agreement also provides that the By-laws of
Purchaser, as in effect immediately prior to the Effective Time, will be the
By-laws of the Surviving Corporation.
Immediately prior to the Effective Time, each outstanding option granted to
a Company employee, consultant or director to purchase Shares ("Option"),
whether or not then exercisable, shall be cancelled by the Company, and each
holder of a cancelled Option shall be entitled to receive a lump sum cash
payment, in consideration for the cancellation of each such Option, equal to the
product of (i) the number of Shares subject to such Option and (ii) the excess
of the per Share Merger Consideration over the exercise price per Share of such
Option; PROVIDED, HOWEVER, that any Option with respect to which the Merger
Consideration does not exceed the exercise price shall be cancelled and no
payment shall be made with respect thereto.
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ACQUISITION PROPOSALS. The Company has agreed that neither it nor any of
its subsidiaries nor any of the respective officers and directors of the Company
and its subsidiaries shall, directly or indirectly, solicit, initiate, encourage
or otherwise facilitate any inquiries or the making of any proposal with respect
to a merger, consolidation or similar transaction involving, or any purchase of
all or any significant portion of the assets or equity of the Company or any of
its subsidiaries (an "Acquisition Proposal") or engage in any negotiations
concerning, or provide any confidential information or data to, or have any
discussions or negotiations with, any person relating to an Acquisition
Proposal, or otherwise facilitate any effort or attempt to make or implement an
Acquisition Proposal.
None of the foregoing shall prohibit the Company or its Board of Directors
from (A) complying with Rules 14d-9 and 14e-2 under the Exchange Act with regard
to an Acquisition Proposal; (B) providing information in response to an
unsolicited bona fide Acquisition Proposal if the Board of Directors takes
reasonable steps to protect the confidentiality of such information; (C)
engaging in negotiations with any person who has made an unsolicited bona fide
written Acquisition Proposal; or (D) recommending such an Acquisition Proposal
to the Company's shareholders if (1) in the case of clauses (B), (C) and (D)
above, the Company reasonably determines in good faith based upon the advice of
outside legal counsel that such action is necessary in order for the Board of
Directors of the Company to comply with its fiduciary duties and (2) in the case
of clauses (C) and (D) above, the Board of Directors of the Company determines
in good faith that the Acquisition Proposal is financially superior to the
transaction contemplated by the Merger Agreement.
BEST EFFORTS. The Merger Agreement provides that, subject to its terms and
conditions, the Company, Thyssen and Purchaser will take all actions necessary
and proper under applicable law, to consummate the Merger, including Purchaser
and Thyssen using their best efforts to prevent any injunction by a government
entity relating to consummation of the transactions contemplated by the Merger
Agreement; PROVIDED, HOWEVER, that the Merger Agreement shall not require, or be
construed to require, Thyssen to agree to sell or hold separate and agree to
sell, any interest in any assets or businesses of Thyssen, the Company or any of
their respective affiliates (or to consent to any sale, or agreement to sell, by
the Company of any of its assets or businesses) or to agree to any material
changes or restriction in the operations of any such assets or businesses.
DIRECTORS AND OFFICERS INDEMNIFICATION AND INSURANCE. Pursuant to the
Merger Agreement, Thyssen has agreed that for a period ending not sooner than
the sixth anniversary of the Effective Time, the Surviving Corporation will
maintain all rights to indemnification existing on the date of this Agreement in
favor of the present and former directors, officers, employees and agents of the
Company as provided in the Company's Articles of Incorporation and Bylaws, in
each case as in effect on the date of the Merger Agreement, and that during such
period, the Articles of Incorporation and Bylaws of the Surviving Corporation
will not be amended or repealed or otherwise modified in any manner that would
adversely affect the rights of indemnity afforded to the present and former
directors, officers, employees and agents of the Company unless required by law;
PROVIDED, that if any claim is asserted within such six-year period, all rights
to indemnification in respect of such claim shall continue until disposition of
such claim.
The Merger Agreement provides that Thyssen and the Surviving Corporation
will maintain in effect for five years from the Effective Time, the current
directors' and officers' liability insurance policies maintained by the Company
and its subsidiaries (provided that the Surviving Corporation may substitute
policies of substantially the same coverage containing terms and conditions
which are no less advantageous) with respect to matters occurring at or prior to
the Effective Time; PROVIDED, HOWEVER, that in no event will Thyssen or the
Surviving Corporation be required to pay an annual premium greater than 125% of
the last annual premium paid prior to the date thereof by the Company for such
insurance.
EMPLOYEE BENEFITS. The Merger Agreement provides that, for a period of one
year following the Effective Time, Thyssen will provide the employees of the
Company with employee benefit plans and programs (excluding plans or programs
which provide for issuance of Shares or options on Shares) that are
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in the aggregate no less favorable than current employee benefit plans and
programs maintained by the Company. The Merger Agreement provides that Thyssen
will cause the surviving company to honor (without modification) certain
specified written employment agreements, severance agreements and certain other
agreements as in effect on the date of the Merger Agreement. The Merger
Agreement also provides that Thyssen agrees to maintain the Company's severance
and incentive plans and the Giddings & Lewis Foundation, Inc. for certain
periods of time.
TERMINATION AND TERMINATION FEE. The Merger Agreement provides that it may
be terminated and the Merger and the Offer may be abandoned at any time prior to
the Effective Time: (a) by mutual written consent of Thyssen and the Company;
(b) by Thyssen or the Company if (i) any governmental body or regulatory
authority of the United States of America or the Federal Republic of Germany
shall have commenced or provided formal notice of legal action with respect to
the transactions contemplated by the Merger Agreement or (ii) Purchaser shall
not have purchased Shares pursuant to the Offer on or before December 31, 1997;
or (c) by the Company if based on the advice of outside legal counsel that such
action is necessary in order for the Board of Directors of the Company to comply
with its fiduciary duties under applicable law, the Board of Directors enters
into an agreement to accept a financially superior Acquisition Proposal, gives
written notice to Thyssen of an intention to enter such agreement, and within
two business days of such written notice Thyssen does not agree to amend the
Merger Agreement such that its terms are determined in good faith by the
Company's Board of Directors (after consultation with its financial advisors) to
be as favorable financially to the shareholders of the Company as such
Acquisition Proposal and prior to termination, the Company pays to Thyssen the
Termination Fee and Expense Reimbursement described below; (d) by the Company if
Purchaser has not commenced the Offer within five business days following the
date of public announcement of the Offer or has terminated the Offer without
purchasing Shares, or if there is a material breach by Purchaser or Thyssen of
any of their representations, warranties or covenants contained in the Merger
Agreement that is not curable (or if curable, that is not cured within 30 days
of notice); (e) by Thyssen, if (i) the Board of Directors of the Company has
withdrawn, adversely modified or not reconfirmed its approval (within five
business days of a written request to do so) of the Merger Agreement, (ii) there
has been a material breach by the Company of any of its representations,
warranties or covenants contained in the Merger Agreement that is noncurable (or
if curable that is not cured within 30 days of notice), (iii) on a scheduled
expiration date all conditions to Purchaser's obligation to accept for payment
and pay for shares other than the Minimum Condition have been satisfied or
waived and Purchaser terminates Offer without purchasing Shares pursuant to the
Offer (provided that the satisfaction or waiver of all other conditions shall
have been publicly disclosed at least five business days before termination of
the Offer), or (iv) Purchaser shall have otherwise terminated the Offer in
accordance with the Merger Agreement without purchasing Shares.
In the event of the termination of the Merger Agreement and abandonment of
the Offer, the Merger Agreement provides that it will become void and there will
be no liability thereunder on the part of any party except under the provisions
of the Merger Agreement related to fees and expenses described below and under
certain other provisions of the Merger Agreement which survive termination.
The Merger Agreement provides that if it is terminated by Thyssen or
Purchaser upon the Company's entry into an agreement that constitutes a
financially superior Acquisition Proposal, or the Board of Directors of the
Company shall have withdrawn, adversely modified or failed to reconfirm their
recommendation of the Merger (within five business days of a written request to
do so), then within no later than two days after the date of such termination,
the Company will pay Thyssen a termination fee of $20 million (the "Termination
Fee"), as well as reimburse Thyssen and Purchaser for expenses and fees up to $3
million incurred in connection with the Merger Agreement (the "Expense
Reimbursement").
In addition, if the Merger Agreement is terminated by Thyssen or by the
Company because Purchaser has terminated the Offer due to a failure to satisfy
the Minimum Condition when all other conditions have been satisfied or waived,
and within one year after such termination either (x) the Company enters into an
agreement to merge with another company (except where the shareholders of the
Company will acquire
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more than 50% of the voting shares of such surviving corporation) or enters into
an agreement where more than 50% of the voting securities are acquired by
another person, or where new voting securities are issued to another person or
the shareholders of another company which aggregate more than 50% of the
outstanding voting securities of the Company, or (y) another person acquires
more than 50% of the Shares, no later than two days after the date of such
occurrences the Company shall pay Thyssen the Termination Fee and Expense
Reimbursement.
The Merger Agreement also contains other restrictions as to the conduct of
business by the Company pending the Merger, as well as representations and
warranties of each of the parties customary in transactions of this kind.
11. PURPOSE OF THE OFFER; PLANS FOR THE COMPANY AFTER THE OFFER AND THE
MERGER.
PURPOSE OF THE OFFER. The purpose of the Offer and the Merger is to enable
Thyssen to acquire control of, and the entire equity interest in, the Company.
Thyssen and the Purchaser have proposed that, following the consummation of the
Offer, the Purchaser would effect the Merger, pursuant to which each then
outstanding Shares (excluding Shares owned by the Purchaser or Thyssen, Shares
held in the treasury of the Company and Shares owned by shareholders who perfect
their dissenters' rights under the BCL, if any), would be converted into the
right to receive an amount in cash equal to the price per Share paid pursuant to
the Offer, and the Company would become an indirect wholly owned subsidiary of
Thyssen. The Offer, as the first step in the acquisition of the Company, is
intended to facilitate the acquisition of all outstanding Shares. The Merger, as
the second step in the acquisition of the Company, is intended to facilitate the
acquisition of any Shares not acquired by the Purchaser in the Offer.
Consummation of the Merger will require, except as set forth below, the
affirmative vote of the holders of a majority of the voting power of the Shares
entitled to vote upon such matter.
Under certain circumstances, the Merger could be consummated without the
approval of the Company's shareholders through a Short-Form Merger (as defined
below). In particular, the BCL provides that if a corporation holds 90% or more
of each class of outstanding shares of a subsidiary corporation, the corporation
may merge the subsidiary into itself upon adoption of a merger agreement by the
board of directors of the corporation and upon complying with certain notice
requirements, but without approval of the shareholders of the subsidiary (a
"Short-Form Merger"). Accordingly, if the Purchaser owns 90% or more of the
outstanding Shares after consummation of the Offer, a Short-Form Merger could be
effected by action of the Board of Directors of the Purchaser without the
approval of the Company's shareholders.
PLANS FOR THE COMPANY AFTER THE OFFER AND THE MERGER. In connection with
the Offer, Thyssen has reviewed, and will continue to review, various possible
business strategies in the event that the Purchaser acquires control of the
Company pursuant to this Offer and the Merger, or otherwise, and will continue
to consider and determine what, if any, changes would be desirable in light of
the circumstances which then exist. Such strategies may include, among other
things, changes in the Company's business, corporate structure, Articles of
Incorporation, Bylaws, capitalization, management or dividend policy.
Except as described in this Offer to Purchase, Thyssen and the Purchaser
have no present plans or proposals that would result in an extraordinary
corporate transaction, such as a merger, consolidation, reorganization,
liquidation or sale or transfer of a material amount of assets, involving the
Company or any of its subsidiaries, or any material changes in the Company's
present capitalization, dividend policy, employee benefit plans, corporate
structure or business or any material changes or reductions in the composition
of its management or personnel. Following further review of the Company's
businesses, financial records, personnel, operations and other matters, it is
possible such plans and intentions of Thyssen and the Purchaser may change.
DISSENTERS' RIGHTS. While no dissenters' rights are available in connection
with the Offer, Sections 180.1301 through 180.1331 of the BCL may provide
dissenters' rights to holders of the Shares, subject to the procedures described
therein, to object to the Merger and demand payment of the "fair value" of their
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Shares in cash in connection with the consummation of the Merger. Dissenters'
rights are available if the Merger is a "business combination" (as defined in
Section 180.1130(3) of the BCL), or if the Shares are not registered on a
national securities exchange or quoted on the National Association of Securities
Dealers, Inc. automated quotations system on the record date for notice of the
shareholders' meeting held to vote on the Merger. The Merger will not be a
"business combination" if it is consummated as a Short-Form Merger or, if at the
time of the Merger, the Company does not have a class of equity securities held
of record by 500 or more persons or there are less than 100 Wisconsin residents
who are shareholders of record with unlimited voting rights. If the Merger is
not a "business combination" and dissenters' rights are available because the
Shares are not registered on an exchange or quoted on Nasdaq, the "fair value"
of the Shares will be determined as of the time immediately prior to the Merger
and will exclude, if equitable, any appreciation or depreciation in the value of
the Shares in anticipation of the Merger. If the Merger is a "business
combination" and dissenters' rights are available, the "fair value" of the
Shares will be determined pursuant to Section 180.1130(9)(a) of the BCL with
reference to the public market price of the Shares if available, or otherwise as
determined in good faith by the Company's Board of Directors. The "fair value",
as so determined, could be more or less than the value per Share to be paid
pursuant to the Offer and the Merger.
The foregoing summary of the rights of dissenting shareholders does not
purport to be a complete statement of the procedures to be followed by
shareholders desiring to exercise their dissenters' rights in connection with
the Merger. The preservation and exericise of dissenters' rights are conditioned
on strict adherence to the applicable provisions of the BCL.
GOING PRIVATE TRANSACTIONS. Rule 13e-3 under the Exchange Act, which
Thyssen does not believe would be applicable to the Merger, would require, among
other things, that certain financial information concerning the Company and
certain information relating to the fairness of the proposed transaction and the
consideration offered to shareholders of the Company therein, be filed with the
Commission and disclosed to shareholders of the Company prior to consummation of
the transaction.
12. DIVIDENDS AND DISTRIBUTIONS. If, on or after June 18, 1997 the Company
should declare or pay any cash or stock dividend (other than regular quarterly
cash dividends not in excess of $.03 per share) on, or split, combine or
otherwise change, the Shares or its capitalization, or shall disclose that it
has taken any such action, then the Purchaser, in its discretion, may make such
adjustments in the Offer consideration and other terms of the Offer as it deems
appropriate to reflect such dividend, split, combination or other change.
13. EFFECT OF THE OFFER ON THE MARKET FOR THE SHARES; EXCHANGE LISTING AND
EXCHANGE ACT REGISTRATION. The purchase of Shares by the Purchaser pursuant to
the Offer will reduce the number of Shares that might otherwise trade publicly
and may reduce the number of holders of Shares, which could adversely affect the
liquidity and market value of the remaining Shares held by the public.
The shares of Common Stock and associated Rights are listed on the Nasdaq
NM. According to Nasdaq's published guidelines, the Shares would no longer be
included in the Nasdaq NM if, among other things, the number of publicly-held
Shares (excluding Shares held directly or indirectly by officers, directors and
any person who is a beneficial owner of more than 10% of the Shares) was less
than 200,000, the aggregate market value of publicly-held Shares was less than
$1,000,000 or there were fewer than 400 holders of the Shares or 300 holders in
round lots. If these standards were not met, quotations might continue to be
published in the over-the-counter "additional list" or one of the "local lists"
unless, as set forth in Nasdaq's published guidelines, the number of
publicly-held Shares was less than 100,000, or there were fewer than 300 holders
in total.
If the Nasdaq NM were to delist the shares of Common Stock and associated
Rights, the market therefore could be adversely affected. It is possible that
the shares of Common Stock and associated Rights would be traded on other
securities exchanges or in the over-the-counter market, and that price
quotations would be reported by such exchanges, or through the Nasdaq or other
sources. The extent of the public market for the shares of Common Stock and
associated Rights and the availability of such quotations
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would, however, depend upon the number of shareholders and/or the aggregate
market value of the shares of Common Stock and associated Rights remaining at
such time, the interest in maintaining a market in the shares of Common Stock
and associated Rights on the part of securities firms, the possible termination
of registration of the Shares under the Exchange Act and other factors.
The shares of Common Stock are presently "margin securities" under the
regulations of the Federal Reserve Board, which has the effect, among other
things, of allowing brokers to extend credit on the collateral of such shares of
Common Stock. Depending upon factors similar to those described above regarding
listing and market quotations, the shares of Common Stock might no longer
constitute "margin securities" for the purposes of the Federal Reserve Board's
margin regulations in which event the shares of Common Stock would be ineligible
as collateral for margin loans made by brokers.
The shares of Common Stock and associated Rights are currently registered
under the Exchange Act. Such registration may be terminated by the Company upon
application to the Commission if the outstanding shares of Common Stock and
associated Rights are not included for trading in the Nasdaq NM and if there are
fewer than 300 holders of record of shares of Common Stock and associated
Rights. Termination of registration of the shares of Common Stock and associated
Rights under the Exchange Act would reduce the information required to be
furnished by the Company to its shareholders and to the Commission and would
make certain provisions of the Exchange Act, such as the short-swing profit
recovery provisions of Section 16(b) and the requirement of furnishing a proxy
statement in connection with shareholders' meetings pursuant to Section 14(a)
and the related requirement of furnishing an annual report to shareholders, no
longer applicable with respect to the shares of Common Stock and Rights.
Furthermore, the ability of "affiliates" of the Company and persons holding
"restricted securities" of the Company to dispose of such securities pursuant to
Rule 144 under the Securities Act of 1933, as amended, may be impaired or
eliminated. If registration of the shares of Common Stock under the Exchange Act
were terminated, the shares of Common Stock would no longer be eligible for
Nasdaq reporting or for continued inclusion on the Federal Reserve Board's list
of "margin securities". The Purchaser reserves the right to seek to cause the
Company to apply for termination of registration of the shares of Common Stock
and associated Rights as soon as possible after consummation of the Offer if the
requirements for termination of registration are met. Even if the registration
of the shares of Common Stock and associated Rights under the Exchange Act is
terminated, the Exchange Act requirement that the Company file periodic reports
may remain applicable to the extent its currently outstanding debt securities
would be required to be registered under the Exchange Act.
14. CERTAIN CONDITIONS OF THE OFFER. Notwithstanding any other provision of
the Offer and provided that Purchaser shall not be obligated to accept for
payment any Shares until (i) expiration of all applicable waiting periods under
the HSR Act and the German Act Against Restraints of Competition (the "AARC")
and (ii) the Minimum Condition shall have been satisfied, Purchaser shall not be
required to accept for payment or pay for, or may delay the acceptance for
payment of or payment for, any Shares tendered pursuant to the Offer, or may,
subject to the terms of the Merger Agreement, terminate or amend the Offer if on
or after June 11, 1997, and at or before the time of payment for any of such
Shares, any of the following events shall occur (or become known to Thyssen) and
remain in effect:
(a) there shall have occurred and be continuing as of the then scheduled
expiration date of the Offer (i)any general suspension of, or limitation on
prices for, trading in securities on the New York Stock Exchange, the Nasdaq
NM or stock exchanges in the Federal Republic of Germany, (ii) a declaration
of a banking moratorium or any suspension of payments in respect of banks in
the United States or the Federal Republic of Germany, (iii) a commencement
or escalation of a war, armed hostilities or other international or national
calamity directly involving the United States or the Federal Republic of
Germany, (iv) any material limitation (whether or not mandatory) by any
governmental or regulatory authority, agency or commission, domestic or
foreign ("Governmental Entity"), on the extension of credit by banks or
other lending institutions in the United States or the Federal Republic of
Germany, (v) or in the case of any of the foregoing existing at the time of
the commencement of the Offer, a material acceleration or worsening thereof;
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(b) (i) the Company shall have breached or failed to perform in any
material respect any of its obligations, covenants or agreements under the
Merger Agreement, (ii) any representation or warranty of the Company set
forth in the Merger Agreement which is qualified by materiality shall not
have been true and correct as of the date of the Merger Agreement and as of
the then scheduled expiration date of the Offer as though made on and as of
the then scheduled expiration date of the Offer or (iii) any representation
or warranty of the Company set forth in the Merger Agreement which is not
qualified by materiality shall not have been true and correct in all
material respects as of the date of this Merger Agreement and as of the then
scheduled expiration date of the Offer as though made on and as of the then
scheduled expiration date of the Offer, except in the case of clauses (ii)
and (iii) of this paragraph (b) for representations and warranties which by
their terms speak only as of another date, which representations and
warranties, if qualified by materiality, shall not have been true and
correct as of such date and, if not qualified, shall not have been true and
correct in all material respects as of such other date;
(c) any court or Governmental Entity shall have enacted, issued,
promulgated, enforced or entered any statute, rule, regulation, executive
order, decree, injunction or other order which is in effect and which (i)
restricts (other than restrictions which in the aggregate do not cause any
adverse change or changes in the financial condition, properties, business
or results of operations of the Company, Thyssen or any of their
subsidiaries, as the case may be, which individually or in the aggregate is
or are material to the Company and its subsidiaries, taken as a whole, or
Parent and its subsidiaries, taken as a whole, as the case may be, other
than any change or effect arising out of general economic conditions (a
"Material Adverse Effect"), or which do not materially restrict the ability
of Thyssen and Purchaser to consummate the Offer and the Merger as
originally contemplated by Thyssen and Purchaser), prevents or prohibits
consummation of the Offer or the Merger, (ii) prohibits or limits (other
than limits which in the aggregate do not have a Material Adverse Effect on
Thyssen, Purchaser or the Company or which do not materially limit the
ability of Thyssen to own and operate all of the business and assets of
Thyssen and the Company after the consummation of the transactions
contemplated by the Offer and the Merger Agreement) the ownership or
operation by the Company, Thyssen or any of their subsidiaries of all or any
material portion of the business or assets of the Company and its
subsidiaries taken as a whole, or as a result of the Offer or the Merger
compels the Company, Thyssen or any of their subsidiaries to dispose of or
hold separate all or any material portion of their respective business or
assets, (iii) imposes limitations (other than limits which in the aggregate
do not have a Material Adverse Effect on Thyssen, Purchaser or the Company
or which do not materially limit the ability of Thyssen to own and operate
all of the business and assets of Thyssen and the Company after the
consummation of the transactions contemplated by the Offer and the Merger
Agreement) on the ability of Thyssen or any subsidiary of Thyssen to
exercise effectively full rights of ownership of any Shares, including,
without limitation, the right to vote any Shares acquired by Purchaser
pursuant to the Offer or otherwise on all matters properly presented to the
Company's shareholders including, without limitation, the approval and
adoption of the Merger Agreement and the transactions contemplated thereby,
(iv) requires divestiture by Thyssen or any affiliate of Thyssen of any
Shares or (v) otherwise materially adversely affects the financial
condition, business or results of operations of the Company and its
subsidiaries taken as a whole;
(d) all consents, registrations, approvals, permits, authorizations,
notices, reports or other filings required to be obtained or made by the
Company, Thyssen or Purchaser with or from any governmental entity in
connection with the execution and delivery of the Merger Agreement, the
Offer and the consummation of the transactions contemplated by the Merger
Agreement shall not have been made or obtained as of the then scheduled
expiration date of the Offer (other than the failure to receive any consent,
registration, approval, permit or authorization or to make any notice,
report or other filing that, in the aggregate, is not reasonably likely to
have a Material Adverse Effect on Thyssen, Purchaser or the Company, or
would not prevent the consummation of the Offer or the Merger);
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(e) any change or development in the financial condition, properties,
business or results of operations of the Company and its Subsidiaries that,
individually or in the aggregate, has had or is reasonably likely to have a
Material Adverse Effect;
(f) the Board of Directors of the Company (or a special committee
thereof) shall have withdrawn or amended, or modified in a manner adverse to
Thyssen and Purchaser its recommendation of the Offer or the Merger, or
shall have endorsed, approved or recommended any other Acquisition Proposal;
(g) the Merger Agreement shall have been terminated by the Company or
Thyssen or Purchaser in accordance with its terms or Thyssen or Purchaser
shall have reached an agreement or understanding in writing with the Company
providing for termination or amendment of the Offer or delay in payment for
the Shares; or
(h) the German Federal Cartel Office shall have notified Thyssen, or
Thyssen shall have become aware, that it will object to the transactions
contemplated by this Merger Agreement;
which, in the reasonable judgment of Thyssen and Purchaser, in any such case,
and regardless of the circumstances (including any action or inaction by Thyssen
or Purchaser) giving rise to any such conditions, makes it inadvisable to
proceed with the Offer and/or with such acceptance for payment of or payment for
Shares.
The foregoing conditions (other than the Minimum Condition) are for the sole
benefit of Thyssen and Purchaser and may be asserted by Thyssen or Purchaser
regardless of the circumstances (including any action or inaction by Thyssen or
Purchaser) giving rise to such condition or may be waived by Thyssen or
Purchaser, in whole or in part at any time and from time to time in its sole
discretion. The determination as to whether any condition has occurred shall be
in the sole judgment of Thyssen and the Purchaser and will be final and binding.
The failure by Thyssen or the Purchaser at any time to exercise any of the
foregoing rights shall not be deemed a waiver of any such right and each such
right shall be deemed an ongoing right which may be asserted at any time and
from time to time. Notwithstanding the fact that the Purchaser reserves the
right to assert the occurrence of a condition following acceptance for payment
but prior to payment in order to delay payment or cancel its obligation to pay
for properly tendered Shares, the Purchaser will either promptly pay for such
Shares or promptly return such Shares.
A public announcement shall be made of a material change in, or waiver of,
such conditions, and the Offer may, in certain circumstances, be extended in
connection with any such change or waiver. Any determination by the Purchaser
concerning the events described in this Section 14 will be final and binding
upon all parties.
15. CERTAIN LEGAL MATTERS.
GENERAL. Except as otherwise disclosed herein, based upon an examination of
publicly available filings with respect to the Company, Thyssen and the
Purchaser are not aware of any licenses or other regulatory permits which appear
to be material to the business of the Company and which might be adversely
affected by the acquisition of Shares by the Purchaser pursuant to the Offer or
of any approval or other action by any governmental, administrative or
regulatory agency or authority which would be required for the acquisition or
ownership of Shares by the Purchaser pursuant to the Offer. Should any such
approval or other action be required, it is currently contemplated that such
approval or action would be sought or taken. There can be no assurance that any
such approval or action, if needed, would be obtained or, if obtained, that it
will be obtained without substantial conditions or that adverse consequences
might not result to the Company's or Thyssen's business or that certain parts of
the Company's or Thyssen's business might not have to be disposed of in the
event that such approvals were not obtained or such other actions were not
taken, any of which could cause the Purchaser to elect to terminate the Offer
without the purchase of the Shares thereunder. The Purchaser's obligation under
the Offer to accept for payment and pay for Shares is subject to certain
conditions. See Section 14.
ANTITRUST COMPLIANCE. Under the HSR Act and the rules that have been
promulgated thereunder by the Federal Trade Commission (the "FTC"), certain
acquisition transactions may not be consummated
25
<PAGE>
unless certain information has been furnished to the Antitrust Division of the
Department of Justice (the "Antitrust Division") and the FTC and certain waiting
period requirements have been satisfied. The acquisition of Shares by the
Purchaser is subject to these requirements. See Section 2 of this Offer to
Purchase as to the effect of the HSR Act on the timing of the Purchaser's
obligation to accept Shares for payment.
Pursuant to the HSR Act, Thyssen filed a Notification and Report Form with
respect to the acquisition of Shares pursuant to the Offer with the Antitrust
Division and the FTC on June 16, 1997. Under the provisions of the HSR Act
applicable to the purchase of Shares pursuant to the Offer, such purchases may
not be made until the expiration of a 15-calendar day waiting period following
the filing by Thyssen. Accordingly, the waiting period under the HSR Act will
expire at 11:59 p.m., New York City time, on July 1, 1997, unless early
termination of the waiting period is granted or Thyssen receives a request for
additional information or documentary material prior thereto. Pursuant to the
HSR Act, Thyssen has requested early termination of the waiting period
applicable to the Offer. There can be no assurances given, however, that the
15-day HSR Act waiting period will be terminated early. If either the FTC or the
Antitrust Division were to request additional information or documentary
material from Thyssen, the waiting period would expire at 11:59 p.m., New York
City time, on the tenth calendar day after the date of substantial compliance by
Thyssen with such request. Thereafter, the waiting period could be extended only
by agreement or by court order. If the acquisition of Shares is delayed pursuant
to a request by the FTC or the Antitrust Division for additional information or
documentary material pursuant to the HSR Act, the purchase of and payment for
Shares will be deferred until 10 days after the request is substantially
complied with unless the waiting period is sooner terminated by the FTC or the
Antitrust Division. See Section 2. Only one extension of such waiting period
pursuant to a request for additional information is authorized by the rules
promulgated under the HSR Act, except by agreement or by court order. Any such
extension of the waiting period will not give rise to any withdrawal rights not
otherwise provided for by applicable law. See Section 4. Although the Company is
required to file certain information and documentary material with the Antitrust
Division and the FTC in connection with the Offer, neither the Company's failure
to make such filings nor a request from the Antitrust Division or the FTC for
additional information or documentary material made to the Company will extend
the waiting period.
The Antitrust Division and the FTC frequently scrutinize the legality under
the antitrust laws of transactions such as the proposed acquisition of Shares by
the Purchaser pursuant to the Offer. At any time before or after the Purchaser's
purchase of Shares, the Antitrust Division or the FTC could take such action
under the antitrust laws as it deems necessary or desirable in the public
interest, including seeking to enjoin the acquisition of Shares pursuant to the
Offer or seeking divestiture of Shares acquired by the Purchaser or the
divestiture of substantial assets of Thyssen, the Company or any of their
respective subsidiaries. Private parties may also bring legal action under the
antitrust laws under certain circumstances. There can be no assurance that a
challenge to the Offer on antitrust grounds will not be made or, if a challenge
is made, what the result will be. See Section 14 of this Offer to Purchase for
certain conditions to the Offer that could become applicable in the event of
such a challenge.
STATE TAKEOVER LAWS. A number of states have adopted laws and regulations
applicable to offers to acquire securities of corporations which are
incorporated in such states and/or which have substantial assets, shareholders,
principal executive offices or principal places of business therein. In EDGAR V.
MITE CORPORATION, the Supreme Court of the United States held that the Illinois
Business Takeover Statute, which made the takeover of certain corporations more
difficult, imposed a substantial burden on interstate commerce and was therefore
unconstitutional. In CTS CORPORATION V. DYNAMICS CORPORATION OF AMERICA, the
Supreme Court held that as a matter of corporate law, and in particular, those
laws concerning corporate governance, a state may constitutionally disqualify an
acquiror of "Control Shares" (ones representing ownership in excess of certain
voting power thresholds e.g. 20%, 33 l/3% or 50%) of a corporation incorporated
in its state and meeting certain other jurisdictional requirements from
exercising voting power with respect to those shares without the approval of a
majority of the disinterested shareholders.
26
<PAGE>
Sections 180.1140 through 180.1144 of the BCL (the "Wisconsin Business
Combination Law") prohibit certain business combinations between a resident
domestic corporation (such as the Company) and an "interested stockholder"
(defined generally as any person that, directly or indirectly, beneficially owns
or has the right to exercise 10% or more of the voting power of the outstanding
voting stock of a resident domestic corporation) for a period of three years
after the date the person becomes an interested stockholder unless the
acquisition of the shares or the business combination has been approved by the
board of directors of the resident domestic corporation prior to the date on
which the interested stockholder became an interested stockholder. Although the
acquisition of the Shares pursuant to the Merger after the purchase of Shares in
the Offer would involve a business combination between a resident domestic
corporation and an interested stockholder, the Company's execution of the Merger
Agreement, which provides for the Offer and the Merger, was unanimously approved
by the Board of Directors of the Company prior to the date on which the
Purchaser will become an interested stockholder. Accordingly, the Wisconsin
Business Combination Law is inapplicable to the Offer and the Merger.
Section 180.1150 of the BCL contains "Control Share" provisions limiting,
under certain circumstances, the voting power of a shareholder that holds in
excess of 20% of the voting power of certain corporations. However, the
Company's Restated Articles of Incorporation, as amended, provide that the
Company has elected not to have such section of the BCL apply to the Company.
Sections 180.1130 through 180.1134 of the BCL (the "Wisconsin Fair Price
Law") generally provide, with certain exceptions, that "business combinations"
involving an "issuing public corporation" (a Wisconsin corporation like the
Company which has a class of equity securities held of record by more than 500
persons and at least 100 shareholders of record who are residents of Wisconsin)
and a "significant shareholder" (defined generally as any person that is the
beneficial owner, either directly or indirectly, of 10% or more of the voting
power of the outstanding voting shares of the issuing public corporation) be
approved by the affirmative vote of at least 80% of the voting power of the
issuing public corporation's stock, and at least 66 2/3% of the voting power of
the corporation's stock not beneficially owned by the significant shareholder,
in each case voting together as a group, unless certain "fair price" conditions
set out in Section 180.1132 of the BCL are satisfied. The amount to be paid for
each Share in either the Offer or pursuant to the Merger satisfies each of the
conditions of Section 180.1132 of the BCL. Accordingly, the restrictions
contained in the Wisconsin Fair Price Law are not applicable to the Offer and
the Merger. In addition, if the Merger is consummated as a Short-Form Merger,
the Merger will not be a "business combination" under, and will not be subject
to the provisions of, the Wisconsin Fair Price Law.
The Purchaser does not believe that any state takeover laws (other than the
foregoing) apply to the Offer and it has not complied with any other state
takeover laws. See Section 11. Should any government official or third party
seek to apply any state takeover law to the Offer, the Purchaser will take such
action as then appears desirable.
If it is asserted that one or more other state takeover laws applies to the
Offer and it is not determined by an appropriate court that such act or acts do
not apply or are invalid as applied to the Offer, the Purchaser might be
required to file certain information with, or receive approvals from, the
relevant state authorities. In addition, if enjoined, the Purchaser might be
unable to accept for payment any Shares tendered pursuant to the Offer, or be
delayed in consummating the Offer. In such case, the Purchaser may not be
obligated to accept for payment any Shares tendered. See Section 13.
EXON-FLORIO. Under Section 721 of Title VII of the United States Defense
Production Act of 1950, as amended by Section 5021 of the Omnibus Trade and
Competitiveness Act of 1988 ("Exon-Florio"), the President of the United States
is authorized to prohibit or suspend acquisitions, mergers or takeovers by
foreign persons of persons engaged in interstate commerce in the United States
if the President determines, after investigation, that such foreign persons in
exercising control of such acquired persons might take action that threatens to
impair the national security of the United States and that other provisions of
existing law do not provide adequate authority to protect national security.
Pursuant to Exon-Florio, notice of an acquisition by a foreign person is to be
made to the Committee on Foreign Investment in the United States ("CFIUS"),
which is comprised of representatives of the Departments of the Treasury, State,
27
<PAGE>
Commerce, Defense and Justice, the Office of Management and Budget, the United
States Trade Representative's Office and the Council of Economic Advisors and
which has been selected by the President to administer Exon-Florio, either
voluntarily by the parties to such proposed acquisition, merger or takeover or
by any member of CFIUS.
A determination that an investigation is called for must be made within 30
days after notification of a proposed acquisition, merger or takeover is first
filed with CFIUS. Any such investigation must be completed within 45 days of
such determination. Any decision by the President to take action must be
announced within 15 days of the completion of the investigation. Although
Exon-Florio does not require the filing of a notification, nor does it prohibit
the consummation of an acquisition, merger or takeover if notification is not
made, such an acquisition, merger or takeover thereafter remains indefinitely
subject to divestment should the President subsequently determine that the
national security of the United States has been threatened or impaired. The
Purchaser does not believe that the Offer or the Merger threatens to impair the
national security of the United States and does not intend to notify CFIUS of
the proposed transaction.
GERMAN AARC. According to the AARC, the acquisition of Shares by Purchaser
pursuant to the Offer is subject to German pre-merger control. Notice of a
transaction subject to German pre-merger control must be provided before
consummation to the FCO, and may not be effected until antitrust review has been
completed and no objections raised. Thyssen expects to file, on or before June
20, 1997, a Pre-Merger Notification with the FCO in connection with the purchase
of Shares pursuant to the Offer. During a statutory one-month period following
the filing, the FCO must either come to a final decision as to the compatibility
of the transaction with the German market, or inform the parties in writing that
it has initiated an in-depth review of the transaction. Assuming Thyssen effects
the filing on June 20, 1997, the one-month period applicable to the purchase of
Shares pursuant to the Offer will expire on July 20, 1997. In most instances to
date, the FCO has completed antitrust review and given clearance to the
respective transactions before the end of the one-month period. However, there
can be no assurance that the review of the purchase of Shares pursuant to the
Offer will also be completed within one month following the filing.
If the FCO is not in a position to come to a final decision within the
one-month period, it will have to inform the parties before the end of such
period in writing that it has initiated an in-depth review of the transaction.
Should the FCO fail to give such information to the parties before the end of
the one-month period, the transaction is treated as if it had been given
clearance. Provided that the FCO has informed the parties about the initiation
of the in-depth review within such period, a review period of four months in
total (beginning with the original filing) becomes applicable to the
transaction. Regarding the purchase of Shares pursuant to the Offer, the
four-month review period, assuming that Thyssen effects the filing on June 20,
1997, will expire on October 20, 1997, unless that period is extended with the
consent of the parties involved. In most instances to date, where a four-month
review period, became applicable to a transaction, the FCO has completed
antitrust review and given clearance to the respective transaction before the
end of such period. There can be no assurance, however, that if the four-month
period becomes applicable to the purchase of Shares pursuant to the Offer,
antitrust review by the FCO will be completed before the end of such period.
In the course of its reviews, the FCO will examine whether the proposed
acquisition of Shares by Purchaser pursuant to the Offer would create a dominant
market position or strengthen an already-existing dominant position in Germany.
If the FCO makes such a finding, it will act to prohibit the transaction. Based
upon an examination of information available to Thyssen relating to the
businesses in which Thyssen, the Company and their respective subsidiaries are
engaged, Thyssen and Purchaser believe that there is no ground for such a
finding. Nevertheless, there can be no assurance that the FCO will not take a
different point of view.
OTHER FOREIGN LAWS. According to publicly available information, the
Company also owns property and conducts business in a number of other countries
and jurisdictions, including Canada and the United Kingdom. In connection with
the acquisition of the Shares pursuant to the Offer, the laws of certain
28
<PAGE>
foreign countries and jurisdictions may require the filing of information with,
or the obtaining of the approval of, governmental authorities in such countries
and jurisdictions. In addition, the waiting period prior to consummation of the
Offer associated with such filings or approvals may extend beyond the scheduled
Expiration Date.
The governments in such countries and jurisdictions might attempt to impose
additional conditions on the Company's operations conducted in such countries
and jurisdictions as a result of the acquisition of the Shares pursuant to the
Offer or the Merger. There can be no assurance that the Purchaser will be able
to cause the Company or its subsidiaries to satisfy or comply with such laws or
that compliance or noncompliance will not have adverse consequences for the
Company or any subsidiary after purchase of the Shares pursuant to the Offer or
the Merger.
ENVIRONMENTAL. Based on a review of publicly available information with
respect to the Company and the review of certain information furnished by the
Company to Thyssen and discussions of representatives of Thyssen with
representatives of the Company during Thyssen's investigation of the Company
(see Section 10), neither the Purchaser nor Thyssen is aware of any
environmental requirements that would be triggered by the Purchaser's
acquisition of the Shares or the Merger that would appear to be material to the
business of the Company and its subsidiaries taken as a whole.
16. FEES AND EXPENSES. Except as set forth below, neither Thyssen nor the
Purchaser will pay any fees or commissions to any broker, dealer or other person
for soliciting tenders of Shares pursuant to the Offer.
Morgan Stanley & Co. Incorporated is acting as Dealer Manager in connection
with the Offer and has provided certain financial advisory services in
connection with the acquisition of the Company. Thyssen has paid Morgan Stanley
a fee of $1,000,000 and has agreed to pay a transaction fee of approximately
$3,100,000 when the Offer is consummated. Thyssen has also agreed to reimburse
Morgan Stanley for all out-of-pocket expenses incurred by Morgan Stanley,
including the fees and expenses of legal counsel, and to indemnify Morgan
Stanley against certain liabilities and expenses in connection with its
engagement, including certain liabilities under the federal securities laws.
In the ordinary course of its business, Morgan Stanley engages in securities
trading, market-making and brokerage activities and may, at any time, hold long
or short positions and may trade or otherwise effect transactions in securities
of the Company. As of June 11, 1997, Morgan Stanley held a net long position of
199,787 Shares.
The Purchaser and Thyssen have retained Morrow & Co., Inc. to act as the
Information Agent and Morgan Guaranty Trust Company of New York to serve as the
Depositary in connection with the Offer. The Information Agent and the
Depositary each will receive reasonable and customary compensation for their
services, be reimbursed for certain reasonable out-of-pocket expenses and be
indemnified against certain liabilities and expenses in connection therewith,
including certain liabilities and expenses under the Federal securities laws.
Neither the Purchaser nor Thyssen, will pay any fees or commissions to any
broker or dealer or other person (other than the Dealer Manager and the
Information Agent) in connection with the solicitation of tenders of Shares
pursuant to the Offer. Brokers, dealers, banks and trust companies will be
reimbursed by the Purchaser upon request for customary mailing and handling
expenses incurred by them in forwarding material to their customers.
17. MISCELLANEOUS. The Offer is not being made to (nor will tenders be
accepted from or on behalf of) holders of Shares in any jurisdiction in which
the making of the Offer or the acceptance thereof would not be in compliance
with the laws of such jurisdiction. Neither the Purchaser nor Thyssen is aware
of any jurisdiction in which the making of the Offer or the acceptance thereof
would not be in compliance with the laws of such jurisdiction. To the extent the
Purchaser or Thyssen becomes aware of any state law that would limit the class
of offerees in the Offer, the Purchaser will amend the Offer and, depending on
the timing of such amendment, if any, will extend the Offer to provide adequate
dissemination of such information to holders of Shares prior to the expiration
of the Offer. In any jurisdiction the securities, blue sky or other laws of
which require the Offer to be made by a licensed broker or dealer, the Offer is
being
29
<PAGE>
made on behalf of the Purchaser by the Dealer Manager or one or more registered
brokers or dealers licensed under the laws of such jurisdiction.
No person has been authorized to give any information or to make any
representation on behalf of the Purchaser or Thyssen not contained herein or in
the Letter of Transmittal and, if given or made, such information or
representation must not be relied upon as having been authorized.
The Purchaser and Thyssen have filed with the Commission a Tender Offer
Statement on Schedule 14D-1 pursuant to Rule 14d-3 under the Exchange Act,
together with exhibits, furnishing certain additional information with respect
to the Offer, and may file amendments thereto. Such Schedule 14D-1 and any
amendments thereto, including exhibits, should be available for inspection and
copies should be obtainable in the manner set forth in Section 7 herein (except
that such material will not be available at the regional offices of the
Commission) and is also available on-line through the Commission's EDGAR
electronic filing and retrieval system.
TAQU, INC.
June 18, 1997
30
<PAGE>
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS
OF THYSSEN AND TAQU
1. DIRECTORS AND EXECUTIVE OFFICERS OF THYSSEN AND TAQU. The name,
business address, present principal occupation or employment and five-year
employment history of each of the directors and executive officers of Thyssen
are set forth below. All such directors and executive officers listed below are
citizens of the Federal Republic of Germany and, unless otherwise indicated,
have been in their present principal occupations for the last five years and,
unless otherwise indicated, the business address of each such person is the
address of Thyssen.
<TABLE>
<CAPTION>
NAME AND POSITION WITH THYSSEN AND/OR TAQU; PRINCIPAL OCCUPATION;
BUSINESS ADDRESS 5-YEAR EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
Prof. Dr. Gunter Vogelsang.............................. Thyssen, Honorary Chairman, Supervisory Board (3/96 -
present); formerly
Thyssen, Chairman, Supervisory Board
Dr. Heinz Kriwet........................................ Thyssen, Chairman, Supervisory Board (3/96 - present);
formerly,
Thyssen, Chairman, Executive Board ( - 3/96)
Walter Riester.......................................... Thyssen, 1st Vice Chairman, Supervisory Board
German Metal Workers' Union (IG Metall), Second Chairman
Wilfried Behrend........................................ Thyssen, Vice Chairman, Supervisory Board
Thyssen Henschel Gmbh, Vice Chairman, Works Council
Dr. Henning Schulte-Noelle.............................. Thyssen, Vice Chairman, Supervisory Board (3/96 -
present)
Allianz AG, Chairman, Executive Board
Carl L. von Boehm-Bezing................................ Thyssen, Member, Supervisory Board (6/97-present);
Deutsche Bank AG, Member, Executive Board
Gunter Dickhausen....................................... Thyssen, Member, Supervisory Board (3/96 - present),
German Federation of Trade Unions (DGB), Member,
Executive Committee of the General Secretariat
Dr. Hermann Franz....................................... Thyssen, Member, Supervisory Board
Siemens AG, Chairman, Supervisory Board (1993-present),
Member, Executive Board (-1993)
Dr. Friedhelm Gieske.................................... Thyssen, Member, Supervisory Board, RWE AG, Member,
Supervisory Board (1994-present), Chairman of the
Executive Board (-1994)
Dr. Klaus Gotte......................................... Thyssen, Member, Supervisory Board (3/96 - present) MAN
AG, Chairman, Supervisory Board (8/96 - present)
MAN, AG, Chairman, Executive Board ( - 8/96)
Dr. Carl H. Hahn........................................ Thyssen, Member, Supervisory Board
Volkswagen AG, Member, Supervisory Board
</TABLE>
S-1
<PAGE>
<TABLE>
<CAPTION>
NAME AND POSITION WITH THYSSEN AND/OR TAQU; PRINCIPAL OCCUPATION;
BUSINESS ADDRESS 5-YEAR EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
Horst Kowalak........................................... Thyssen, Member, Supervisory Board
German Federation of Trade Unions (DGB), Department
Head, General Secretariat
Dieter Kroll............................................ Thyssen, Member, Supervisory Board (skilled steel mill
worker)
Thyssen Stahl AG, Chairman, General Works Council ( -
5/97)
Thyssen, General Works Council, Chairman (6/92 -
present)
Walter Scheel........................................... Thyssen, Member, Supervisory Board
Federal Republic of Germany, former President
Thomas Schlenz.......................................... Thyssen, Member, Supervisory Board (shift foreman) (3/96
- present)
TKR Thyssen Klockner Recycling GmbH, Chairman, General
Works Council
Heinz Schleuber......................................... Thyssen, Member, Supervisory Board
North Rhine-Westphalia, Minister of Finance
Klaus Schmid............................................ Thyssen, Member, Supervisory Board
German Metal Workers' Union (IG Metal), Department head,
General Secretariat
Dr. Hermann Scholl...................................... Thyssen, Member, Supervisory Board (3/96 - present)
Robert Bosch GmbH, Chairman, Managing Board
(1993-present), Member, Managing Board (1993-present)
Wilhelm Segerath........................................ Thyssen, Member, Supervisory Board (6/97 - present)
Thyssen, General Works Council (Chairman 6/97 - present)
Dr. Walter Seipp........................................ Thyssen, Member, Supervisory Board
Commerzbank AG, Chairman, Supervisory Board
Bernhard Walter......................................... Thyssen, Member Supervisory Board (3/97 - present)
Dresdner Bank AG, Member, Executive Board
Erich Wilke............................................. Thyssen, Member, Supervisory Board
BfG Hypothekenbank AG, Chairman, Executive Board
Dr. Dieter H. Vogel..................................... Chairman of the Executive Board of Thyssen since 1996;
Member of the Executive Board of Thyssen from 1986 to
1996; Chairman of the Executive Board of Thyssen
Handelsunion AG, Hans-Gunther-Sohl-Str. 1 40235
Dusseldorf Germany from 1986 to 1996; Member of the
Board of Thyssen Holding Corporation, 3155 Big Beaver
Road, Troy, Michigan 48007, since 1996.
</TABLE>
S-2
<PAGE>
<TABLE>
<CAPTION>
NAME AND POSITION WITH THYSSEN AND/OR TAQU; PRINCIPAL OCCUPATION;
BUSINESS ADDRESS 5-YEAR EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
Siegfried Buschmann..................................... Member of the Board and President of Thyssen Holding
Corporation, 3155 Big Beaver Road, Troy, Michigan 48007;
Chairman of the Board of Directors and Chief Executive
Officer of The Budd Company, 3155 Big Beaver Road, Troy,
Michigan 48007; Chairman of the Executive Board, Thyssen
Budd Automotive GmbH, Essen, Germany.
Dr. Hans-Erich Forster.................................. Member of the Executive Board of Thyssen since 1996;
Chairman of the Executive Board of Thyssen Handelsunion
AG, Hans-Gunther-Sohl-Str. 1 40235 Dusseldorf Germany
since 1996; Member of the Executive Board of Stinnes AG
Humboldtring 15 45472 Mulheim, 1992 to 1996; Member of
the Executive Board of Thyssen Industrie AG, Am
Thyssenhaus 1 45128 Essen Germany from 1985 to 1992.
Dieter Hennig........................................... Member of the Executive Board of Thyssen; Member of the
Executive Board of Thyssen Stahl AG, Kaiser-Wilhelm-Str.
100 47166 Duisburg Germany.
Dr. Eckhard Rohkamm..................................... Member of the Executive Board of Thyssen; Chairman of
the Executive Board of Thyssen Industrie AG, Am
Thyssenhaus 1 45128 Essen Germany.
Dr. Ekkehard Schulz..................................... Member of the Executive Board of Thyssen; Chairman of
the Executive Board of Thyssen Stahl AG,
Kaiser-Wilhelm-Str. 100 47166 Duisburg Germany.
Dr. Heinz-Gerd Stein.................................... Member of the Executive Board of Thyssen; Member of the
Board of Thyssen Holding Corporation, Dover Delaware
USA.
Axel Kirsch............................................. President and Member of the Board of TAQU since 1997;
Vice President for Corporate Development of Thyssen
since 1997; COO of Elsnerdruck GmbH, Lutzowstrabe
107-112 10785 Berlin Germany from 1994 to 1996; Project
Manager for Bertelsmann Industry, Carl-
Bertelsmann-Strabe 161 33311 Gutersloh Germany from 1991
to 1993.
</TABLE>
S-3
<PAGE>
<TABLE>
<CAPTION>
NAME AND POSITION WITH THYSSEN AND/OR TAQU; PRINCIPAL OCCUPATION;
BUSINESS ADDRESS 5-YEAR EMPLOYMENT HISTORY
- -------------------------------------------------------- --------------------------------------------------------
<S> <C>
Dr. Eckart Brockfeld.................................... Secretary and Treasurer and Member of the Board of TAQU
since 1997; Legal counsel of Thyssen since 1996;
Director of Corporate Development and Personnel of
Thyssen Haniel Logistic GmbH from 1993 to 1996; Legal
counsel of Thyssen Handelsunion AG from 1989 to 1993;
Assistant Secretary of Thyssen Holding Corporation,
Dover, Delaware since 1996.
</TABLE>
S-4
<PAGE>
Facsimiles of the Letter of Transmittal, properly completed and duly
executed, will be accepted. The Letter of Transmittal, certificates evidencing
Shares and any other required documents should be sent or delivered by each
shareholder or his or her broker, dealer, commercial bank, trust company or
other nominee to the Depositary at one of its addresses set forth below.
THE DEPOSITARY FOR THE OFFER IS:
MORGAN GUARANTY TRUST COMPANY OF NEW YORK
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
Morgan Guaranty Trust Morgan Guaranty Trust Morgan Guaranty Trust
Company of New York Company of New York Company of New York
Corporate Reorganization C/O State Street Corporate C/O Securities Transfer & Reporting
P.O. Box 8216 Reorganization Services, Inc. (STARS)
Boston, MA 02266-8216 70 Campanelli Dr. 1 Exchange Plaza/55 Broadway, 3rd Fl.
Braintree, MA 02184 New York, NY 10006
Attn: Stock Transfer Window
FACSIMILE TRANSMISSION:
(FOR ELIGIBLE INSTITUTIONS
ONLY)
(617) 794-6333
CONFIRM BY TELEPHONE:
(617) 794-6388
</TABLE>
------------------------
Any questions and requests for assistance may be directed to the Information
Agent or the Dealer Manager at their respective addresses and telephone numbers
listed below. Additional copies of this Offer to Purchase, the Letter of
Transmittal and the Notice of Guaranteed Delivery may also be obtained from the
Information Agent. A shareholder may also contact brokers, dealers, commercial
banks or trust companies for assistance concerning the Offer.
THE INFORMATION AGENT FOR THE OFFER IS:
[LOGO]
909 Third Avenue
20th Floor
New York, New York 10022
(212) 754-8000
Toll Free: (800) 566-9061
Banks and Brokerage Firms please call:
(800) 662-5200
THE DEALER MANAGER FOR THE OFFER IS:
MORGAN STANLEY DEAN WITTER
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
(212) 761-6531
<PAGE>
LETTER OF TRANSMITTAL
TO TENDER SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED RIGHTS TO PURCHASE
CLASS A PREFERRED STOCK, SERIES B)
OF
GIDDINGS & LEWIS, INC.
PURSUANT TO THE OFFER TO PURCHASE
DATED JUNE 18, 1997
BY
TAQU, INC.
AN INDIRECT WHOLLY OWNED SUBSIDIARY OF
THYSSEN AKTIENGESELLSCHAFT
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME,
ON WEDNESDAY, JULY 16, 1997, UNLESS THE OFFER IS EXTENDED.
THE DEPOSITARY FOR THE OFFER IS:
MORGAN GUARANTY TRUST COMPANY OF NEW YORK
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
Morgan Guaranty Trust Morgan Guaranty Trust Morgan Guaranty Trust
Company of New York Company of New York Company of New York
Corporate Reorganization C/O State Street Corporate C/O Securities Transfer & Reporting
P.O. Box 8216 Reorganization Services, Inc. (STARS)
Boston, MA 02266-8216 70 Campanelli Dr. 1 Exchange Plaza/55 Broadway, 3rd Fl.
Braintree, MA 02184 New York, NY 10006
Attn: Stock Transfer Window
FACSIMILE TRANSMISSION:
(FOR ELIGIBLE INSTITUTIONS
ONLY)
(617) 794-6333
CONFIRM BY TELEPHONE:
(617) 794-6388
</TABLE>
------------------------
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS,
OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE NUMBER,
OTHER THAN AS SET FORTH ABOVE DOES NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
This Letter of Transmittal is to be used either if certificates for Shares
(as such term is defined below) are to be forwarded herewith or, unless an
Agent's Message (as defined in the Offer to Purchase) is used in lieu of this
Letter of Transmittal, if delivery of Shares is to be made by book-entry
transfer to an account maintained by the Depositary at a Book-Entry Transfer
Facility as defined in and pursuant to the procedures set forth in Section 2 of
the Offer to Purchase. Shareholders who deliver Shares by book-entry transfer
are referred to herein as "Book-Entry Shareholders" and other shareholders are
referred to herein as "Certificate Shareholders." DELIVERY OF DOCUMENTS TO A
BOOK-ENTRY TRANSFER FACILITY IN ACCORDANCE WITH SUCH BOOK-ENTRY TRANSFER
FACILITY'S PROCEDURES DOES NOT CONSTITUTE DELIVERY TO THE DEPOSITARY.
Shareholders who desire to tender Shares pursuant to the Offer and whose
certificates for Shares are not immediately available or who cannot comply with
the procedure for book-entry transfer on a timely basis, or who cannot deliver
all required documents to the Depositary prior to the Expiration Date (as
defined in Section 1 of the Offer to Purchase) may tender such Shares by
following all of the guaranteed delivery procedures set forth in Section 3 of
the Offer to Purchase. See Instruction 2.
<PAGE>
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED BY BOOK-ENTRY TRANSFER
MADE TO AN ACCOUNT MAINTAINED BY THE DEPOSITARY WITH A BOOK-ENTRY TRANSFER
FACILITY AND COMPLETE THE FOLLOWING (ONLY PARTICIPANTS IN A BOOK-ENTRY
TRANSFER FACILITY MAY DELIVER SHARES BY BOOK-ENTRY TRANSFER):
Name of Tendering Institution ______________________________________________
Check box of Book-Entry Transfer Facility:
(CHECK ONE) / / The Depository Trust Company / / Philadelphia
Depository Trust Company
Account Number _______________ Transaction Code Number ______________
/ / CHECK HERE IF TENDERED SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF
GUARANTEED DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE
FOLLOWING:
Name(s) of Registered Owner(s) _____________________________________________
Date of Execution of Notice of Guaranteed Delivery _________________________
Name of Institution that Guaranteed Delivery _______________________________
If delivered by book-entry transfer check box of Book-Entry Transfer
Facility:
/ / The Depository Trust Company / / Philadelphia Depository Trust
Company
Account Number: ______________ Transaction Code Number: _____________
2
<PAGE>
<TABLE>
<S> <C> <C> <C>
DESCRIPTION OF SHARES TENDERED
<CAPTION>
NAME(S) AND ADDRESS(ES) OF REGISTERED OWNER(S)
(PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) APPEAR(S) ON CERTIFICATE(S) AND SHARES TENDERED
CERTIFICATE(S)) (ATTACH ADDITIONAL LIST IF NECESSARY)
<S> <C> <C> <C>
TOTAL NUMBER OF
SHARES
REPRESENTED NUMBER OF
CERTIFICATE BY SHARES
NUMBER(S)* CERTIFICATE(S)* TENDERED**
TOTAL SHARES
* Need not be completed by Book-Entry Shareholders.
** Unless otherwise indicated, it will be assumed that all Shares described above are being tendered. See
Instruction 4.
</TABLE>
NOTE: SIGNATURES MUST BE PROVIDED BELOW
PLEASE READ THE INSTRUCTIONS SET FORTH IN THIS LETTER OF TRANSMITTAL CAREFULLY.
Ladies and Gentlemen:
The undersigned hereby tenders to TAQU, Inc., a Delaware corporation (the
"Purchaser"), and an indirect wholly owned subsidiary of Thyssen
Aktiengesellschaft, a company organized under the laws of the Federal Republic
of Germany, the above-described shares of common stock, par value U.S. $0.10 per
share (the "Common Stock"), including the associated rights to purchase shares
of Class A Preferred Stock, Series B (the "Rights", and together with the Common
Stock, the "Shares"), of Giddings & Lewis, Inc., a Wisconsin corporation (the
"Company"), upon the terms and subject to the conditions set forth in the Offer
to Purchase, dated June 18, 1997 (the "Offer to Purchase"), and in this Letter
of Transmittal (which, together with any amendments or supplements thereto or
hereto, collectively constitute the "Offer"), receipt of which is hereby
acknowledged.
Upon the terms and subject to the conditions of the Offer (including, if the
Offer is extended or amended, the terms and conditions of such extension or
amendment), and subject to, and effective upon, acceptance for payment of, and
payment for, the Shares tendered herewith in accordance with the terms of the
Offer, the undersigned hereby sells, assigns and transfers to, or upon the order
of, the Purchaser all right, title and interest in and to all the Shares that
are being tendered hereby (and any and all other Shares or other securities or
rights issued or issuable in respect thereof on or after June 18, 1997), and
irrevocably appoints Axel Kirsch and Dr. Eckert Brockfeld, the true and lawful
agent and attorney-in-fact of the undersigned, with full power of substitution
(such power of attorney being deemed to be an irrevocable power coupled with an
interest), to the full extent of the undersigned's rights with respect to such
Shares (and any such other Shares or securities or rights), (a) to deliver
certificates for such Shares (and any such other Shares or securities or rights)
or transfer ownership of such Shares (and any such other Shares or securities or
rights) on the account books maintained by a Book-Entry Transfer Facility
together, in any such case, with all accompanying evidences of transfer and
authenticity to, or upon the order of, the Purchaser, (b) to present such Shares
(and any such other Shares or securities or rights) for transfer on the
Company's books and (c) to receive all benefits and otherwise exercise all
rights of beneficial ownership of such Shares (and any such other Shares or
securities or rights), all in accordance with the terms of the Offer.
The undersigned hereby represents and warrants that the undersigned has full
power and authority to tender, sell, assign and transfer the tendered Shares
(and any and all other Shares or other securities or rights issued or issuable
in respect of such Shares on or after June 18, 1997) and, if and when the same
are accepted for payment by the Purchaser, the Purchaser will acquire good title
thereto, free and clear of all liens, restrictions, claims and encumbrances, and
the same will not be subject to any adverse claim. The undersigned will, upon
request, execute any additional documents deemed by the Depositary or the
Purchaser to be necessary or desirable to complete the sale, assignment and
transfer of the tendered Shares (and any and all other Shares or other
securities or rights issued or issuable in respect thereof on or after June 18,
1997).
3
<PAGE>
All authority conferred or agreed to be conferred pursuant to this Letter of
Transmittal shall be binding upon the successors, assigns, heirs, executors,
administrators and legal representatives of the undersigned and shall not be
affected by, and shall survive, the death or incapacity of the undersigned.
Except as stated in the Offer to Purchase, this tender is irrevocable. See
Section 4 of the Offer to Purchase.
The undersigned hereby irrevocably appoints the designees of the Purchaser
the attorneys-in-fact and proxies of the undersigned, each with full power of
substitution, to vote at any annual, special or adjourned meeting of the
Company's Shareholders or otherwise in such manner as each such attorney-in-fact
and proxy or his substitute shall in his sole discretion deem proper with
respect to, to execute any written consent concerning any matter as each such
attorney-in-fact and proxy or his substitute shall in his sole discretion deem
proper with respect to, and to otherwise act as each such attorney-in-fact and
proxy or his substitute shall in his sole discretion deem proper with respect
to, the Shares tendered hereby that have been accepted for payment by the
Purchaser prior to the time any such action is taken and with respect to which
the undersigned is entitled to vote (and any and all other Shares or other
securities or rights issued or issuable in respect of such Shares on or after
June 18, 1997). This appointment is effective when, and only to the extent that,
the Purchaser accepts for payment such Shares as provided in the Offer to
Purchase. This power of attorney and proxy are irrevocable, are granted in
consideration of the acceptance for payment of such Shares in accordance with
the terms of the Offer and shall be considered coupled with an interest in the
Shares. Upon such acceptance for payment, all prior powers of attorney, proxies
and consents given by the undersigned with respect to such Shares or other
securities or rights will, without further action, be revoked and no subsequent
powers of attorney, proxies, consents or revocations may be given (and, if
given, will not be deemed effective) by the undersigned.
The undersigned understands that the valid tender of Shares pursuant to any
of the procedures described in Section 3 of the Offer to Purchase and in the
instructions hereto will constitute a binding agreement between the undersigned
and the Purchaser upon the terms and subject to the conditions of the Offer.
Without limiting the foregoing, if the price to be paid in the Offer is amended
in accordance with the Offer, the price to be paid to the undersigned will be
the amended price notwithstanding the fact that a different price is stated in
this Letter of Transmittal.
Unless otherwise indicated herein under "Special Payment Instructions,"
please issue the check for the purchase price and/or return any certificates for
Shares not tendered or accepted for payment in the name(s) of the registered
holder(s) appearing under "Description of Shares Tendered." Similarly, unless
otherwise indicated under "Special Delivery Instructions," please mail the check
for the purchase price and/or return any certificates for Shares not tendered or
accepted for payment (and accompanying documents, as appropriate) to the
address(es) of the registered holder(s) appearing under "Description of Shares
Tendered." In the event that both the Special Delivery Instructions and the
Special Payment Instructions are completed, please issue the check for the
purchase price and/or return any certificates for Shares not tendered or
accepted for payment (and any accompanying documents, as appropriate) in the
name of, and deliver such check and/or return such certificates (and any
accompanying documents, as appropriate) to, the person or persons so indicated.
Unless otherwise indicated herein under "Special Payment Instructions," please
credit any Shares tendered herewith by book-entry transfer that are not accepted
for payment by crediting the account at the Book-Entry Transfer Facility
designated above. The undersigned recognizes that the Purchaser has no
obligation pursuant to the Special Payment Instructions to transfer any Shares
from the name of the registered holder thereof if the Purchaser does not accept
for payment any of the Shares so tendered.
/ / CHECK HERE IF ANY OF THE CERTIFICATES REPRESENTING SHARES THAT YOU OWN HAVE
BEEN LOST OR DESTROYED AND SEE INSTRUCTION 11.
Number of Shares represented by the lost or destroyed certificates _____________
4
<PAGE>
<TABLE>
<S> <C>
SPECIAL PAYMENT SPECIAL DELIVERY INSTRUCTIONS
INSTRUCTIONS (SEE INSTRUCTIONS 1, 5, 6 AND
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
7) To be completed ONLY if certificates for
To be completed ONLY if certificates for Shares not tendered or not accepted for
Shares not tendered or not accepted for payment and/or the check for the purchase
payment and/or the check for the purchase price of Shares accepted for payment are
price of Shares accepted for payment are to be sent to someone other than the
to be issued in the name of someone other undersigned, or the undersigned at an
than the undersigned. address other than that above.
Issue: Mail: / / Check / / Certificate(s)
/ / Check / / Certificate(s) to:
to: Name:
Name: (PLEASE PRINT)
(PLEASE Address:
PRINT)
Address: (INCLUDE ZIP CODE)
(INCLUDE ZIP (TAXPAYER IDENTIFICATION OR SOCIAL
CODE) SECURITY NUMBER)
(SEE SUBSTITUTE FORM W-9 ON REVERSE
(TAXPAYER IDENTIFICATION OR SOCIAL SIDE)
SECURITY NUMBER)
(SEE SUBSTITUTE FORM W-9 ON REVERSE
SIDE)
</TABLE>
5
<PAGE>
<TABLE>
<S> <C> <C>
IMPORTANT
SHAREHOLDER(S): SIGN HERE
(PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW)
SIGNATURE(S) OF HOLDERS(S)
Dated: , 1997
(Must be signed by registered holder(s) as name(s) appear(s) on
the certificate(s) for the Shares or on a security position
listing or by a person(s) authorized to become registered
holder(s) by certificate(s) and documents transmitted herewith.
If signature is by a trustee, executor, administrator,
guardian, attorney-in-fact, officer of a corporation or other
person acting in a fiduciary or representative capacity, please
provide the following information and see Instruction 5.)
Name(s):
(PLEASE PRINT)
Capacity (full title):
Address:
(INCLUDE ZIP CODE)
Area Code and Telephone No.:
Taxpayer Identification or Social Security No.:
(SEE SUBSTITUTE FORM W-9 ON REVERSE SIDE)
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED -- SEE INSTRUCTIONS 1 AND 5)
Authorized Signature:
Name:
(PLEASE PRINT)
Name of Firm:
Address:
INCLUDE ZIP CODE
Area Code and Telephone No.:
Dated: , 1997
FOR USE BY FINANCIAL INSTITUTIONS ONLY. PLACE
MEDALLION GUARANTEE OVER ABOVE INFORMATION.
</TABLE>
6
<PAGE>
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. No signature guarantee is required on this
Letter of Transmittal (a) if this Letter of Transmittal is signed by the
registered holder(s) (which term, for purposes of this Section, includes any
participant in any of the Book-Entry Transfer Facilities' systems whose name
appears on a security position listing as the owner of the Shares) of Shares
tendered herewith and such registered holder(s) has completed neither the box
entitled "Special Payment Instructions" nor the box entitled "Special Delivery
Instructions" on their Letter of Transmittal or (b) if such Shares are tendered
for the account of a financial institution (including most commercial banks,
savings and loan associations and brokerage houses) that is a participant in the
Security Transfer Agents Medallion Program, the New York Stock Exchange
Medallion Signature Guarantee Program or the Stock Exchange Medallion Program
(each an "Eligible Institution"). In all other cases, all signatures on this
Letter of Transmittal must be guaranteed by an Eligible Institution. See
Instruction 5.
2. REQUIREMENTS OF TENDER. This Letter of Transmittal is to be completed by
a tendering shareholder either if certificates for Shares are to be forwarded
herewith or, unless an Agent's Message (as defined below) is used in lieu of
this Letter of Transmittal, if delivery of Shares is to be made by book-entry
transfer to an account maintained by the Depositary at a Book-Entry Transfer
Facility pursuant to the procedures set forth in Section 3 of the Offer to
Purchase. For a shareholder validly to tender Shares pursuant to the Offer,
either (a) a properly completed and duly executed Letter of Transmittal (or a
manually executed facsimile thereof) in accordance with these instructions, with
any required signature guarantees, or, in the case of a book-entry transfer, an
Agent's Message in lieu of a Letter of Transmittal, and any other required
documents, must be received by the Depositary at one of its addresses set forth
herein prior to the Expiration Date and either certificates for tendered Shares
must be received by the Depositary at one of such addresses or such Shares must
be delivered pursuant to the procedures for book-entry transfer set forth herein
(and a Book-Entry Confirmation, received by the Depositary), in each case prior
to the Expiration Date, or (b) the tendering shareholder must comply with the
guaranteed delivery procedures set forth below and in Section 3 of the Offer to
Purchase.
A shareholder who desires to tender Shares pursuant to the Offer and whose
certificates for Shares are not immediately available or who cannot comply with
the procedure for book-entry transfer on a timely basis, or who cannot deliver
all required documents to the Depositary prior to the Expiration Date, may
tender such Shares by properly completing and duly executing the Notice of
Guaranteed Delivery pursuant to the guaranteed delivery procedure set forth in
Section 3 of the Offer to Purchase. Pursuant to such procedure, (a) such tender
must be made by or through an Eligible Institution, (b) a properly completed and
duly executed Notice of Guaranteed Delivery, substantially in the form provided
by the Purchaser, must be received by the Depositary, as provided below, prior
to the Expiration Date and (c) the certificates for all tendered Shares, in
proper form for transfer (or a Book-Entry Confirmation, with respect to all such
Shares) together with a properly completed and duly executed Letter of
Transmittal (or a manually executed facsimile thereof) with any required
signature guarantees (or, in the case of a book-entry transfer, an Agent's
Message in lieu of a Letter of Transmittal), and any other required documents,
are received by the Depositary within three trading days after the date of
execution of such Notice of Guaranteed Delivery. A "trading day" is any day on
which the New York Stock Exchange, Inc. is open for business.
The term "Agent's Message" means a message transmitted by a Book-Entry
Transfer Facility to, and received by, the Depositary and forming a part of a
Book-Entry Confirmation, which states that such Book-Entry Transfer Facility has
received an express acknowledgment from the participant in such Book-Entry
Transfer Facility tendering the Shares that such participant has received and
agrees to be bound by the terms of the Letter of Transmittal and that the
Purchaser may enforce such agreement against the participant.
The signatures on this Letter of Transmittal cover the Shares tendered
hereby.
7
<PAGE>
THE METHOD OF DELIVERY OF SHARES, THE LETTER OF TRANSMITTAL AND ALL OTHER
REQUIRED DOCUMENTS, INCLUDING DELIVERY THROUGH ANY BOOK-ENTRY TRANSFER FACILITY,
IS AT THE ELECTION AND RISK OF THE TENDERING SHAREHOLDER. SHARES WILL BE DEEMED
DELIVERED ONLY WHEN ACTUALLY RECEIVED BY THE DEPOSITARY (INCLUDING, IN THE CASE
OF A BOOK-ENTRY TRANSFER, BY BOOK-ENTRY CONFIRMATION). IF DELIVERY IS BY MAIL,
REGISTERED MAIL WITH RETURN RECEIPT REQUESTED, PROPERLY INSURED, IS RECOMMENDED.
IN ALL CASES, SUFFICIENT TIME SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted and no
fractional Shares will be purchased. All tendering shareholders, by execution of
this Letter of Transmittal (or a manually executed facsimile thereof), waive any
right to receive any notice of the acceptance of their Shares for payment.
3. INADEQUATE SPACE. If the space provided herein is inadequate, the
certificate numbers and/or the number of Shares should be listed on a separate
schedule attached hereto.
4. PARTIAL TENDERS (APPLICABLE TO CERTIFICATE SHAREHOLDERS ONLY). If fewer
than all the Shares evidenced by any certificate submitted are to be tendered,
fill in the number of Shares that are to be tendered in the box entitled "Number
of Shares Tendered." In any such case, new certificate(s) for the remainder of
the Shares that were evidenced by the old certificate(s) will be sent to the
registered holder, unless otherwise provided in the appropriate box on this
Letter of Transmittal, as soon as practicable after the acceptance for payment
of, and payment for, the Shares tendered herewith. All Shares represented by
certificates delivered to the Depositary will be deemed to have been tendered
unless otherwise indicated.
5. SIGNATURES ON LETTER OF TRANSMITTAL; STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the Shares
tendered hereby, the signature(s) must correspond with the name(s) as written on
the face of the certificate(s) without any change whatsoever.
If any of the Shares tendered hereby are owned of record by two or more
joint owners, all such owners must sign this Letter of Transmittal.
If any tendered Shares are registered in different names on several
certificates, it will be necessary to complete, sign and submit as many separate
Letters of Transmittal as there are different registrations of certificates.
If this Letter of Transmittal or any certificates or stock powers are signed
by a trustee, executor, administrator, guardian, attorney-in-fact, officer of a
corporation or other person acting in a fiduciary or representative capacity,
such persons should so indicate when signing, and proper evidence satisfactory
to the Purchaser of their authority so to act must be submitted.
When this Letter of Transmittal is signed by the registered owner(s) of the
Shares listed and transmitted hereby, no endorsements of certificates or
separate stock powers are required unless payment or certificates for Shares not
tendered or accepted for payment are to be issued to a person other than the
registered owner(s). Signatures on such certificates or stock powers must be
guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered owner(s) of the certificates listed, the certificates must be
endorsed or accompanied by appropriate stock powers, in either case signed
exactly as the name or names of the registered owner or owners appear on the
certificates. Signatures on such certificates or stock powers must be guaranteed
by an Eligible Institution.
6. STOCK TRANSFER TAXES. The Purchaser will pay any stock transfer taxes
with respect to the transfer and sale of Shares to it or its order pursuant to
the Offer. If, however, payment of the purchase price is to be made to, or if
certificates for Shares not tendered or accepted for payment are to be
registered in the name of, any person(s) other than the registered holder(s), or
if tendered certificates are registered in the name(s) of any person(s) other
than the person(s) signing this Letter of Transmittal, the amount of any stock
transfer taxes (whether imposed on the registered holder(s) or such person(s))
payable on account of the transfer to such person(s) will be deducted from the
purchase price unless satisfactory evidence of the payment of such taxes or
exemption therefrom is submitted. Except as provided in this Instruction 6, it
will not be necessary for transfer tax stamps to be affixed to the certificates
listed in this Letter of Transmittal.
7. SPECIAL PAYMENT AND DELIVERY INSTRUCTIONS. If a check is to be issued in
the name of, and/or certificates for Shares not accepted for payment are to be
returned to, a person other than the signer of this Letter of Transmittal or if
a check is to be sent and/or such certificates are to be returned to a person
other than the signer of this Letter of
8
<PAGE>
Transmittal or to an address other than that shown above, the appropriate boxes
on this Letter of Transmittal should be completed.
8. WAIVER OF CONDITIONS. The Purchaser reserves the absolute right in its
sole discretion to waive any of the specified conditions of the Offer, in whole
or in part, in the case of any Shares tendered.
9. 31% BACKUP WITHHOLDING. In order to avoid "backup withholding" of
Federal income tax on payments of cash pursuant to the Offer, a shareholder
surrendering Shares in the Offer must, unless an exemption applies, provide the
Depositary with such shareholder's correct Taxpayer Identification Number
("TIN") on Substitute Form W-9 in this Letter of Transmittal and certify under
penalties of perjury that such TIN is correct and that such shareholder is not
subject to backup withholding. If a shareholder does not provide such
shareholder's correct TIN or fails to provide the certifications described
above, the Internal Revenue Service (the "IRS") may impose a penalty on such
shareholder and payment of cash to such shareholder pursuant to the Offer may be
subject to backup withholding of 31%.
Backup withholding is not an additional income tax. Rather, the amount of
the backup withholding can be credited against the Federal income tax liability
of the person subject to the backup withholding, provided that the required
information is given to the IRS. If backup withholding results in an overpayment
of tax, a refund can be obtained by the shareholder upon filing an income tax
return.
The shareholder is required to give the Depositary the TIN (i.e., social
security number or employer identification number) of the record owner of the
Shares. If the Shares are held in more than one name or are not in the name of
the actual owner, consult the enclosed "Guidelines for Certification of Taxpayer
Identification Number on Substitute Form W-9" for additional guidance on which
number to report.
The box in Part 3 of the Substitute Form W-9 may be checked if the tendering
shareholder has not been issued a TIN and has applied for a TIN or intends to
apply for a TIN in the near future. If the box in Part 3 is checked, the
shareholder or other payee must also complete the Certificate of Awaiting
Taxpayer Identification Number below in order to avoid backup withholding.
Notwithstanding that the box in Part 3 is checked and the Certificate of
Awaiting Taxpayer Identification Number is completed, the Depositary will
withhold 31% on all payments made prior to the time a properly certified TIN is
provided to the Depositary. However, such amounts will be refunded to such
shareholder if a TIN is provided to the Depositary within 60 days.
Certain shareholders (including, among others, all corporations and certain
foreign individuals and entities) are not subject to backup withholding. If you
are exempt from backup withholding, you should still complete the Substitute
Form W-9 to avoid possible erroneous backup withholding. Enter your correct TIN
in Part I, write "Exempt" on the face of the form, and sign and date the form.
Noncorporate foreign shareholders should complete and sign the main signature
form and a Form W-8, Certificate of Foreign Status, a copy of which may be
obtained from the Depositary, in order to avoid backup withholding. See the
enclosed "Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9" for more instructions.
10. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions and requests
for assistance or additional copies of the Offer to Purchase, the Letter of
Transmittal, the Notice of Guaranteed Delivery and the Guidelines for
Certification of Taxpayer Identification Number on Substitute Form W-9 may be
directed to the Information Agent or the Dealer Manager at their respective
addresses set forth below.
11. LOST, DESTROYED OR STOLEN CERTIFICATES. If any certificate representing
Shares has been lost, destroyed or stolen, the shareholder should promptly
notify the Depositary by checking the box immediately preceding the special
payment/special delivery instructions and indicating the number of Shares lost.
The shareholder will then be instructed as to the steps that must be taken in
order to replace the certificate. This Letter of Transmittal and related
documents cannot be processed until the procedures for replacing lost or
destroyed certificates have been followed.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR MANUALLY EXECUTED FACSIMILE
THEREOF), TOGETHER WITH ANY REQUIRED SIGNATURE GUARANTEES, OR, IN THE CASE OF A
BOOK-ENTRY TRANSFER, AN AGENT'S MESSAGE IN LIEU OF THIS LETTER OF TRANSMITTAL,
AND ANY OTHER REQUIRED DOCUMENTS, MUST BE RECEIVED BY THE DEPOSITARY PRIOR TO
THE EXPIRATION DATE AND EITHER CERTIFICATES FOR TENDERED SHARES MUST BE RECEIVED
BY THE DEPOSITARY OR SHARES MUST BE DELIVERED PURSUANT TO THE PROCEDURES FOR
BOOK-ENTRY TRANSFER, IN EACH CASE PRIOR TO THE EXPIRATION DATE, OR THE TENDERING
SHAREHOLDER MUST COMPLY WITH THE PROCEDURES FOR GUARANTEED DELIVERY.
9
<PAGE>
PAYER'S NAME: MORGAN GUARANTY TRUST COMPANY OF NEW YORK
<TABLE>
<S> <C> <C>
SUBSTITUTE PART I--Please provide your TIN in the -----------------------------
FORM W-9 box at right and certify by signing and Social Security Number
DEPARTMENT OF THE TREASURY dating below OR
INTERNAL REVENUE SERVICE -----------------------------
Employer Identification
Number
PART II CERTIFICATES--Under penalties of perjury, I certify that:
(1) The number shown on this form is my correct Taxpayer Identification
Number (or I am waiting for a number to be issued to me); and
(2) I am not subject to backup withholding because (a) I am exempt from
backup withholding or (b) I have not been notified by the Internal
Revenue Service ("IRS") that I am subject to backup withholding as
a result of a failure to report all interest or dividends or (c)
the IRS has notified me that I am no longer subject to backup
withholding.
</TABLE>
<TABLE>
<S> <C> <C>
PAYER'S REQUEST FOR CERTIFICATION INSTRUCTIONS--You must cross out item Part III
TAXPAYER (2) in Part II above if you have been notified by
IDENTIFICATION NUMBER the IRS that you are subject to backup Taxpayer Awaiting TIN / /
(TIN) withholding because of underreporting of interest or
dividends on your tax returns. However, if after Part IV
being notified by the IRS that you were subject to
backup withholding you received another notification Exempt TIN / /
from the IRS stating that you are no longer subject
to backup withholding, do not cross out item (2). If
you are exempt from backup withholding, check the
box in Part IV above.
SIGNATURE --------------------------------------------------- DATE
- ----------------, 1997
</TABLE>
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED
THE BOX IN PART III OF SUBSTITUTE FORM W-9
CERTIFICATE OF AWAITING TAXPAYER IDENTIFICATION NUMBER
I certify under penalties of perjury that a taxpayer identification number
has not been issued to me, and either (a) I have mailed or delivered an
application to receive a taxpayer identification number to the appropriate
Internal Revenue Service Center or Social Security Administration Office or
(b) I intend to mail or deliver an application in the near future. I
understand that, if I do not provide a taxpayer identification number to the
Depositary, 31% of all reportable payments made to me will be withheld, but
will be refunded if I provide a certified taxpayer identification number
within 60 days.
---------------------------------------------
---------------------------------------------
Signature Date
NOTE: FAILURE TO COMPLETE AND RETURN THIS SUBSTITUTE FORM W-9 MAY RESULT IN
BACKUP WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE
OFFER. PLEASE REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER
IDENTIFICATION NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL INFORMATION.
10
<PAGE>
THE INFORMATION AGENT FOR THE OFFER IS:
[LOGO]
909 Third Avenue
20th Floor
New York, New York 10022
(212) 754-8000
Toll Free: (800) 566-9061
Banks and Brokerage Firms please call:
(800) 662-5200
THE DEALER MANAGER FOR THE OFFER IS:
MORGAN STANLEY DEAN WITTER
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
(212) 761-6531
June 18, 1997
11
<PAGE>
NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF SHARES OF COMMON STOCK
OF
GIDDINGS & LEWIS, INC.
(NOT TO BE USED FOR SIGNATURE GUARANTEES)
As set forth in Section 3 of the Offer to Purchase (as defined below), this
form or one substantially equivalent hereto must be used to accept the Offer (as
defined below) if certificates for Common Stock, par value U.S. $0.10 per share
(the "Common Stock"), including the associated rights to purchase Class B
Preferred Stock, Series A (the "Rights" and together with the Common Stock, the
"Shares"), of Giddings & Lewis, Inc., a Wisconsin corporation (the "Company"),
are not immediately available (including if the procedure for book-entry
transfer cannot be completed on a timely basis or time will not permit all
required documents to reach the Depositary prior to the Expiration Date). The
term "Expiration Date" means 12:00 midnight, New York City time, on Wednesday,
July 16, 1997, unless and until the Purchaser, in its sole discretion, shall
have extended the period of time during which the Offer is open, in which event
the "Expiration Date" shall mean the latest time and date at which the Offer, as
so extended by the Purchaser, will expire. This form may be delivered by hand to
the Depositary or transmitted by telegram, facsimile transmission or mail to the
Depositary and must include a guarantee by an Eligible Institution (as defined
in the Offer to Purchase) in the form set forth herein. See Section 3 of the
Offer to Purchase.
THE DEPOSITARY FOR THE OFFER IS:
MORGAN GUARANTY TRUST COMPANY OF NEW YORK
<TABLE>
<S> <C> <C>
BY MAIL: BY OVERNIGHT COURIER: BY HAND:
Morgan Guaranty Trust Morgan Guaranty Trust Morgan Guaranty Trust
Company of New York Company of New York Company of New York
Corporate Reorganization C/O State Street Corporate C/O Securities Transfer & Reporting
P.O. Box 8216 Reorganization Services, Inc. (STARS)
Boston, MA 02266-8216 70 Campanelli Dr. 1 Exchange Plaza/55 Broadway, 3rd Fl.
Braintree, MA 02184 New York, NY 10006
Attn: Stock Transfer Window
BY FACSIMILE TRANSMISSION:
(FOR ELIGIBLE INSTITUTIONS
ONLY)
(617) 794-6333
CONFIRM BY TELEPHONE:
(617) 794-6388
</TABLE>
DELIVERY OF THIS INSTRUMENT TO AN ADDRESS, OR TRANSMISSION OF INSTRUCTIONS
VIA A FACSIMILE NUMBER, OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A
VALID DELIVERY.
This form is not to be used to guarantee signatures. If a signature on a
Letter of Transmittal is required to be guaranteed by an Eligible Institution
(as defined below) under the instructions thereto, such signature guarantee must
appear in the applicable space provided in the signature box on the Letter of
Transmittal.
<PAGE>
Ladies and Gentlemen:
The undersigned hereby tenders to TAQU, Inc., a Delaware corporation (the
"Purchaser"), which is an indirect wholly owned subsidiary of Thyssen
Aktiengesellschaft, a company organized under the laws of the Federal Republic
of Germany, upon the terms and subject to the conditions set forth in the Offer
to Purchase dated June 18, 1997 (the "Offer to Purchase") and the related Letter
of Transmittal (such Offer to Purchase and related Letter of Transmittal,
together with any amendments or supplements thereto, the "Offer"), receipt of
which is hereby acknowledged, the number of Shares set forth below, all pursuant
to the guaranteed delivery procedures set forth in the Section 3 of the Offer to
Purchase.
<TABLE>
<S> <C>
Number of Shares: Area Code and Tel. No.:
Name(s) of Record Holder(s): (Check one box if Shares will be tendered
by book-entry transfer)
/ / The Depository Trust Company
/ / Philadelphia Depository Trust Company
(Please Print)
Signature(s):
Certificate Nos. (if available)
Account Number:
Address(es):
Dated:
Zip Code
</TABLE>
2
<PAGE>
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a participant in the Security Transfer Agent's Medallion
Program, the New York Stock Exchange Medallion Signature Guarantee Program or
the Stock Exchange Medallion Program (an "Eligible Institution"), hereby
guarantees to deliver to the Depositary either the certificates representing the
Shares tendered hereby, in proper form for transfer, or a Book-Entry
Confirmation with respect to such Shares, together with a properly completed and
duly executed Letter of Transmittal (or manually executed facsimile thereof),
with any required signature guarantees (or, in the case of a book-entry
transfer, an Agent's Message, as defined in the Letter of Transmittal, in lieu
of a Letter of Transmittal), and any other required documents within three
trading days after the date hereof.
The Eligible Institution that completes this form must communicate the
guarantee to the Depositary and must deliver the Letter of Transmittal and
certificates for Shares to the Depositary within the time period shown herein.
Failure to do so could result in a financial loss to such Eligible Institution.
All terms used herein have the meaning set forth in the Offer to Purchase.
<TABLE>
<S> <C>
NAME OF FIRM AUTHORIZED SIGNATURE
ADDRESS TITLE
Name:
ZIP CODE PLEASE TYPE OR PRINT
Date: , 1997
AREA CODE AND TELEPHONE NUMBER
</TABLE>
NOTE: DO NOT SEND CERTIFICATES FOR SHARES WITH THIS NOTICE. CERTIFICATES FOR
SHARES SHOULD BE SENT WITH YOUR LETTER OF TRANSMITTAL.
3
<PAGE>
MORGAN STANLEY & CO. INCORPORATED
1585 BROADWAY
NEW YORK, NEW YORK 10036
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES
(INCLUDING THE ASSOCIATED RIGHTS TO
PURCHASE CLASS A PREFERRED STOCK, SERIES B)
OF
GIDDINGS & LEWIS, INC.
AT
$21.00 NET PER SHARE
BY
TAQU, INC.
AN INDIRECT WHOLLY OWNED SUBSIDIARY OF
THYSSEN AKTIENGESELLSCHAFT
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON WEDNESDAY, JULY 16, 1997, UNLESS THE OFFER IS EXTENDED.
JUNE 18, 1997
TO BROKERS, DEALERS, COMMERCIAL BANKS,
TRUST COMPANIES AND OTHER NOMINEES:
WE HAVE BEEN ENGAGED BY TAQU, INC., A DELAWARE CORPORATION (THE "PURCHASER")
AND AN INDIRECT WHOLLY OWNED SUBSIDIARY OF THYSSEN AKTIENGESELLSCHAFT, A COMPANY
ORGANIZED UNDER THE LAWS OF THE FEDERAL REPUBLIC OF GERMANY ("THYSSEN"), TO ACT
AS DEALER MANAGER IN CONNECTION WITH THE OFFER TO PURCHASE, ALL OUTSTANDING
SHARES OF COMMON STOCK, PAR VALUE U.S. $0.10 PER SHARE (THE "COMMON STOCK"),
INCLUDING THE ASSOCIATED RIGHTS TO PURCHASE SHARES OF CLASS A PREFERRED STOCK,
SERIES B (THE "RIGHTS" AND TOGETHER WITH THE COMMON STOCK, THE "SHARES"), OF
GIDDINGS & LEWIS, INC., A WISCONSIN CORPORATION (THE "COMPANY") UPON THE TERMS
AND SUBJECT TO THE CONDITIONS SET FORTH IN THE OFFER TO PURCHASE DATED JUNE 18,
1997 (THE "OFFER TO PURCHASE"), AND IN THE RELATED LETTER OF TRANSMITTAL (WHICH,
TOGETHER WITH ANY AMENDMENTS OR SUPPLEMENTS THERETO, COLLECTIVELY CONSTITUTE THE
"OFFER"). PLEASE FURNISH COPIES OF THE ENCLOSED MATERIALS TO THOSE OF YOUR
CLIENTS FOR WHOM YOU HOLD SHARES REGISTERED IN YOUR NAME OR IN THE NAME OF YOUR
NOMINEE.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION DATE (AS DEFINED BELOW) THAT
NUMBER OF SHARES THAT WOULD REPRESENT AT LEAST A MAJORITY OF ALL OUTSTANDING
SHARES ON A FULLY DILUTED BASIS ON THE DATE OF PURCHASE. THE OFFER IS ALSO
CONDITIONED UPON, AMONG OTHER THINGS, THE EXPIRATION OR TERMINATION OF ALL
WAITING PERIODS UNDER THE HART-SCOTT-RODINO ANTITRUST IMPROVEMENTS ACT OF 1976,
AS AMENDED, AND ANY OTHER FOREIGN COMPETITION AND ANTITRUST STATUTES AND
REGULATIONS, INCLUDING THE APPROVAL OF THE GERMAN FEDERAL CARTEL OFFICE PURSUANT
TO THE GERMAN ACT AGAINST RESTRAINTS OF COMPETITION.
<PAGE>
ENCLOSED HEREWITH ARE COPIES OF THE FOLLOWING DOCUMENTS:
1. OFFER TO PURCHASE DATED JUNE 18, 1997;
2. LETTER OF TRANSMITTAL TO BE USED BY SHAREHOLDERS OF THE COMPANY IN
ACCEPTING THE OFFER;
3. A PRINTED FORM OF LETTER THAT MAY BE SENT TO YOUR CLIENTS FOR WHOSE
ACCOUNT YOU HOLD SHARES IN YOUR NAME OR IN THE NAME OF A NOMINEE, WITH SPACE
PROVIDED FOR OBTAINING SUCH CLIENTS' INSTRUCTIONS WITH REGARD TO THE OFFER;
4. NOTICE OF GUARANTEED DELIVERY;
5. GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION NUMBER ON
SUBSTITUTE FORM W-9; AND
6. RETURN ENVELOPE ADDRESSED TO MORGAN GUARANTY TRUST COMPANY OF NEW YORK,
THE DEPOSITARY.
THE TERM "EXPIRATION DATE" MEANS 12:00 MIDNIGHT, NEW YORK CITY TIME, ON
WEDNESDAY, JULY 16, 1997, UNLESS AND UNTIL THE PURCHASER, IN ITS SOLE
DISCRETION, SHALL HAVE EXTENDED THE PERIOD OF TIME DURING WHICH THE OFFER IS
OPEN, IN WHICH EVENT THE "EXPIRATION DATE" SHALL MEAN THE LATEST TIME AND DATE
AT WHICH THE OFFER, AS SO EXTENDED BY THE PURCHASER, WILL EXPIRE.
WE URGE YOU TO CONTACT YOUR CLIENTS PROMPTLY. PLEASE NOTE THAT THE OFFER AND
WITHDRAWAL RIGHTS EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON WEDNESDAY,
JULY 16, 1997, UNLESS THE OFFER IS EXTENDED BY THE PURCHASER.
NEITHER THE PURCHASER NOR THYSSEN WILL PAY ANY FEES OR COMMISSIONS TO ANY
BROKER OR DEALER OR OTHER PERSON (OTHER THAN THE DEALER MANAGER AND THE
INFORMATION AGENT AS DESCRIBED IN THE OFFER TO PURCHASE) IN CONNECTION WITH THE
SOLICITATION OF TENDERS OF SHARES PURSUANT TO THE OFFER. YOU WILL BE REIMBURSED
UPON REQUEST FOR CUSTOMARY MAILING AND HANDLING EXPENSES INCURRED BY YOU IN
FORWARDING THE ENCLOSED OFFERING MATERIALS TO YOUR CUSTOMERS.
ADDITIONAL COPIES OF THE ENCLOSED MATERIAL MAY BE OBTAINED BY CONTACTING THE
INFORMATION AGENT OR THE DEALER MANAGER AT THEIR RESPECTIVE ADDRESSES AND
TELEPHONE NUMBERS SET FORTH ON THE BACK COVER OF THE ENCLOSED OFFER TO PURCHASE.
VERY TRULY YOURS,
MORGAN STANLEY & CO. INCORPORATED
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL RENDER YOU OR
ANY OTHER PERSON THE AGENT OF THE PURCHASER, THYSSEN, THE DEPOSITARY, THE
INFORMATION AGENT OR THE DEALER MANAGER OR AUTHORIZE YOU OR ANY OTHER PERSON TO
GIVE ANY INFORMATION OR MAKE ANY REPRESENTATION ON BEHALF OF ANY OF THEM WITH
RESPECT TO THE OFFER NOT CONTAINED IN THE OFFER TO PURCHASE OR THE LETTER OF
TRANSMITTAL.
2
<PAGE>
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES
(INCLUDING THE ASSOCIATED RIGHTS
TO PURCHASE CLASS A PREFERRED STOCK, SERIES B)
OF
GIDDINGS & LEWIS, INC.
AT
$21.00 NET PER SHARE
BY
TAQU, INC.
AN INDIRECT WHOLLY OWNED SUBSIDIARY OF
THYSSEN AKTIENGESELLSCHAFT
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK
CITY TIME, ON WEDNESDAY, JULY 16, 1997, UNLESS THE OFFER IS EXTENDED.
To Our Clients:
Enclosed for your consideration are the Offer to Purchase dated June 18,
1997 (the "Offer to Purchase") and the related Letter of Transmittal (which,
together with any amendments or supplements thereto, collectively constitute the
"Offer") relating to the Offer by TAQU, Inc., Delaware corporation (the
"Purchaser") and an indirect wholly owned subsidiary of Thyssen
Aktiengesellschaft, a company organized under the laws of the Federal Republic
of Germany ("Thyssen"), to purchase for cash all outstanding shares of common
stock, par value U.S. $0.10 per share (the "Common Stock"), including the
associated rights to purchase shares of Class A Preferred Stock, Series B (the
"Rights" and together with the Common Stock, the "Shares"), of Giddings & Lewis,
Inc., a Wisconsin corporation (the "Company").
We are the holder of record of Shares held by us for your account. A TENDER
OF SUCH SHARES CAN BE MADE ONLY BY US AS THE HOLDER OF RECORD AND PURSUANT TO
YOUR INSTRUCTIONS. THE LETTER OF TRANSMITTAL IS FURNISHED TO YOU FOR YOUR
INFORMATION ONLY AND CANNOT BE USED BY YOU TO TENDER SHARES HELD BY US FOR YOUR
ACCOUNT.
We request instructions as to whether you wish to tender any or all of the
Shares held by us for your account, pursuant to the terms and conditions set
forth in the Offer.
Your attention is directed to the following:
1. The tender offer price is $21.00 per Share, net to the seller in
cash, without interest thereon, upon the terms and subject to the conditions
of the Offer.
2. The Offer is being made for all of the outstanding Shares.
3. The Offer and withdrawal rights will expire at 12:00 midnight, New
York City time, on Wednesday, July 16, 1997, unless the Offer is extended by
the Purchaser.
4. The Board of Directors of the Company unanimously has determined that
each of the Offer and the Merger (as defined in the Offer to Purchase) is
fair to, and in the best interest of, the
<PAGE>
shareholders of the Company, and recommends that shareholders accept the
Offer and tender their Shares pursuant to the Offer.
5. The Offer is conditioned upon, among other things, there being
validly tendered and not withdrawn prior to the Expiration Date (as defined
below) that number of Shares that would represent at least a majority of all
outstanding Shares on a fully diluted basis on the date of purchase. The
Offer is also conditioned upon, among other things, the expiration or
termination of all waiting periods under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, and any other foreign competition and
antitrust statutes and regulations, including the approval of the German
Federal Cartel Office pursuant to the German Act against Restraints of
Competition.
The term "Expiration Date" means 12:00 midnight, New York City time, on
Wednesday, July 16, 1997, unless and until the Purchaser, in its sole
discretion, shall have extended the period of time during which the Offer is
open, in which event the "Expiration Date" shall mean the latest time and
date at which the Offer, as so extended by the Purchaser, will expire.
6. Any stock transfer taxes applicable to a sale of Shares to the
Purchaser will be borne by the Purchaser, except as otherwise provided in
Instruction 6 of the Letter of Transmittal.
Your instruction to us should be forwarded promptly to permit us to submit a
tender on your behalf prior to the expiration of the Offer.
If you wish to have us tender any of or all of your Shares held by us for
your account, please so instruct us by completing, executing, detaching and
returning to us the instruction form on the detachable part hereof. An envelope
to return your instructions to us is enclosed. If you authorize the tender of
your Shares, all such Shares will be tendered unless otherwise specified on the
detachable part hereof. Your instructions should be forwarded to us in ample
time to permit us to submit a tender on your behalf prior to the expiration of
the Offer.
In all cases, payment for Shares accepted for payment pursuant to the Offer
will be made only after timely receipt by Morgan Guaranty Trust Company of New
York (the "Depositary"), of (a) certificates for (or a timely Book-Entry
Confirmation (as defined in the Offer to Purchase) with respect to) such Shares,
(b) a Letter of Transmittal (or a manually executed facsimile thereof), properly
completed and duly executed, with any required signature guarantees (or, in the
case of a book-entry transfer, an Agent's Message (as defined in the Letter of
Transmittal) in lieu of a Letter of Transmittal) and (c) any other documents
required by the Letter of Transmittal. Accordingly, tendering shareholders may
be paid at different times depending upon when certificates for Shares or
Book-Entry Confirmations with respect to Shares are actually received by the
Depositary. UNDER NO CIRCUMSTANCES WILL INTEREST BE PAID ON THE PURCHASE PRICE
OF THE SHARES TO BE PAID BY THE PURCHASER, REGARDLESS OF ANY EXTENSION OF THE
OFFER OR ANY DELAY IN MAKING SUCH PAYMENT.
The Offer is not being made to, nor will tenders be accepted from, or on
behalf of, holders of Shares in any jurisdiction in which the making or
acceptance of the Offer would not be in compliance with the laws of such
jurisdiction.
2
<PAGE>
INSTRUCTIONS WITH RESPECT TO THE OFFER TO PURCHASE FOR
CASH ALL OUTSTANDING SHARES OF GIDDINGS & LEWIS, INC.
The undersigned acknowledge(s) receipt of your letter, the Offer to Purchase
of TAQU, Inc. dated June 18, 1997 (the "Offer to Purchase") and the related
Letter of Transmittal relating to shares of Common Stock par value U.S.$ 0.10
per share (the "Common Stock"), including the associated rights to purchase
shares of Class A Preferred Stock, Series B (the "Rights" and together with the
Common Stock, the "Shares"), of Giddings & Lewis, Inc., a Wisconsin corporation
(the "Company").
This will instruct you to tender the number of Shares indicated below held
by you for the account of the undersigned, on the terms and subject to the
conditions set forth in such Offer to Purchase and Letter of Transmittal.
<TABLE>
<S> <C>
SIGN HERE
Number of Shares ---------------------------------------------------
to be Tendered* ---------------------------------------------------
Shares SIGNATURE(S)
---------------------------------------------------
---------------------------------------------------
PLEASE PRINT NAME(S) AND ADDRESS(ES)
---------------------------------------------------
---------------------------------------------------
DATED: , 1997 AREA CODE(S) AND TELEPHONE NUMBER(S)
---------------------------------------------------
---------------------------------------------------
TAXPAYER IDENTIFICATION OR SOCIAL SECURITY NUMBER(S)
</TABLE>
- ------------------------
* Unless otherwise indicated, it will be assumed that all Shares held by us for
your account are to be tendered.
3
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE PAYER.--
Social Security numbers "SSNs" have nine digits separated by two hyphens: i.e.
000-00-0000. Employer identification numbers "EINs" have nine digits separated
by only one hyphen: i.e. 00-0000000. The table below will help determine the
number to give the payer.
<TABLE>
<CAPTION>
FOR THIS TYPE OF ACCOUNT GIVE THE NAME AND SSN OF--
- ---------------------------------------------------------- -----------------------------------------------
<S> <C> <C>
1. An individual's account The individual
2. Two or more individuals (joint account) The actual owner of the account or, if combined
funds, the first individual on the account
3. Custodian account of a minor (Uniform Gift to The minor(2)
Minors Act)
4. a. The usual revocable savings trust The grantor-trustee(1)
account (grantor is also trustee)
b. So-called trust account that is not The actual owner(1)
a legal or valid trust
under State law
5. Sole proprietorship account The owner(3)
</TABLE>
<TABLE>
<CAPTION>
FOR THIS TYPE OF ACCOUNT GIVE THE NAME AND EIN OF--
- ---------------------------------------------------------- -----------------------------------------------
<S> <C> <C>
6. Sole proprietorship The owner
7. A valid trust, estate, or pension trust The legal entity(4)
8. Corporate account The corporation
9. Association, Club, Religious, charitable, The organization
educational or other tax-exempt organization
10. Partnership account The partnership
11. A broker or registered nominee The broker or nominee
12. Account will the Department of Agriculture in The public entity
the name of a public entity (such as a State or
local government, school district, or prison)
that receives agricultural program payments
</TABLE>
- --------------------------
(1) List first and circle the name of the person whose number you furnish. If
only one person on a joint account has an SSN, that person's number must be
furnished.
(2) Circle the minor's name and furnish the minor's SSN.
(3) You must show your individual name, but you may also enter your business or
"doing business as" name. You may use either your SSN or EIN (if you have
one.)
(4) List first and circle the name of the legal trust, estate, or pension trust.
NOTE: If no name is circled when there is more than one name, the number will be
considered to be that of the first name listed.
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you don't know your
number, obtain Form SS-5, Application for a Social Security Card, or Form SS-4,
Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for a
number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Backup withholding is not required if the payee is:
1. An organization exempt from tax under section 501(a), an IRA, or a
custodial account under section 403(b)(7), if the account satisfies the
requirements of section 401(f)(2).
2. The United States or any of its agencies or instrumentalities.
3. A state, the District of Columbia, a possession of the United States, or
any of their political subdivisions or instrumentalities.
4. A foreign government or any of its political subdivisions, agencies, or
instrumentalities.
5. An international organization or any of its agencies or
instrumentalities.
OTHER PAYEES THAT MAY BE EXEMPT FROM BACKUP WITHHOLDING INCLUDE:
6. A corporation.
<PAGE>
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
PAGE 2
7. A foreign central bank of issue.
8. A dealer in securities or commodities required to register in the United
Sttes, the District of Columbia, or a possession of the United States.
9. A futures commission merchant registered with the Commodity Futures
Trading Commission.
10. A real estate investment trust.
11. An entity registered at all times during the tax year under the
Investment Company Act of 1940.
12. A common trust fund operated by a bank under section 584(a).
13. A financial institution.
14. A middleman known in the investment community as a nominee or who is
listed in the most recent publication of the American Society of Corporate
Secretaries, Inc., Nominee List.
15. A trust exempt from tax under section 664 or described in section 4947.
Interest and Dividend Payments.--All listed payees are exempt except the payee
in item (9).
Broker Transactions.--All payees listed in items (1) through (13) are exempt. A
person registered under the Investment Advisors Act of 1940 who regularly acts
as a broker is also exempt.
PAYMENTS EXEMPT FROM BACKUP WITHHOLDING
Payments that are not subject to information reporting also are not subject
to backup withholding. For details, see sections 6041, 6041A, 6042, 6044, 6045,
6049, 6050A, and 6050N, and their regulations.
Dividends and patronage dividends that generally are exempt from backup with
holding include:
- Payments to nonresident aliens subject to withholding under section 1441.
- Payments to partnerships not engaged in a trade or business in the United
States and that have at least one nonresident alien partner.
- Payments of patronage dividends not paid in money.
- Payments made by certain foreign organizations.
- Section 404(k) payments made by an ESOP.
JOINT FOREIGN PAYEES
If the first payee listed on an account provides Form W-8, Certificate of
Foreign Status, or a similar statement signed under penalties of perjury, backup
withholding applies unless:
1. Every joint payee provides the statement regarding foreign status; or
2. Any one of the joint payees who has not established foreign status
provides a TIN.
If any one of the joint payees who has not established foreign status
provides a TIN, that number is the TIN that must be used for purposes of backup
withholding and information reporting.
PRIVACY ACT NOTICE.--Section 6109 requires most recipients of dividend,
interest, or other payments to give taxpayer identification numbers to payers
who must report the payments to IRS. IRS uses the numbers for identification
purposes. Payers must be given the numbers whether or not recipients are
required to file tax returns. Beginning January 1, 1984, payers must generally
withhold 20% of taxable interest, dividend, and certain other payments to a
payee who does not furnish a taxpayer identification number to a payer. Certain
penalties may also apply.
PENALTIES.
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER.--If you fail
to furnish your taxpayer identification number to a payer, you are subject to a
penalty of $50 for each such failure unless your failure is due to reasonable
cause and not to willful neglect.
(2) FAILURE TO REPORT CERTAIN DIVIDEND AND INTEREST PAYMENTS.--If you fail to
include any portion of an includible payment for interest, dividends, or
patronage dividends in gross income, such failure will be treated as being due
to negligence and will be subject to a penalty of 5% on any portion of an
under-payment attributable to that failure unless there is clear and convincing
evidence to the contrary.
(3) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING.--If you
make a false statement with no reasonable basis which results in no imposition
of backup withholding, you are subject to a penalty of $500.
(4) CRIMINAL PENALTY FOR FALSIFYING INFORMATION.--Falsifying certifications or
affirmations may subject you to criminal penalties including fines and/or
imprisonment.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX CONSULTANT OR THE INTERNAL
REVENUE SERVICE.
<PAGE>
This announcement is neither an offer to purchase nor a solicitation of an
offer to sell Shares. The Offer is made solely by the Offer to Purchase dated
June 18, 1997, and the related Letter of Transmittal, and is not being made to
(nor will tenders be accepted from or on behalf of) holders of Shares in any
jurisdiction in which the making of the Offer or the acceptance thereof would
not be in compliance with the laws of such jurisdiction. In any jurisdictions
where securities, blue sky or other laws require the Offer to be made by a
licensed broker or dealer, the Offer shall be deemed to be made on behalf of the
Purchaser by Morgan Stanley & Co. Incorporated or one or more registered brokers
or dealers licensed under the laws of such jurisdiction.
NOTICE OF OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
(INCLUDING THE ASSOCIATED RIGHTS TO PURCHASE CLASS A PREFERRED STOCK, SERIES B)
OF
GIDDINGS & LEWIS, INC.
AT
$21.00 NET PER SHARE
BY
TAQU, INC.
AN INDIRECT WHOLLY OWNED SUBSIDIARY
OF
THYSSEN AKTIENGESELLSCHAFT
TAQU, Inc., a Delaware corporation (the "Purchaser") and an indirect wholly
owned subsidiary of Thyssen Aktiengesellschaft, a company organized under the
laws of the Federal Republic of Germany ("Thyssen"), hereby offers to purchase
all outstanding shares of Common Stock, par value $0.10 per share (the "Common
Stock"), including the associated rights to purchase Class A Preferred Stock,
Series B (the "Rights" and together with the Common Stock the "Shares"), of
Giddings & Lewis, Inc., a Wisconsin corporation (the "Company"), at a price of
$21.00 per Share net to the seller in cash, without interest thereon (the "Offer
Price"), upon the terms and subject to the conditions set forth in the Offer to
Purchase dated June 18, 1997 (the "Offer to Purchase"), and in the related
Letter of Transmittal (which, together with any amendments or supplements
thereto, collectively constitute the "Offer"). Following the Offer, Purchaser
intends to effect the Merger described below.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON WEDNESDAY, JULY 16, 1997, UNLESS THE OFFER IS
EXTENDED.
The Offer is conditioned upon, among other things, there being validly
tendered and not withdrawn prior to the Expiration Date (as defined below) that
number of Shares that would represent at least a majority of all outstanding
Shares on a fully diluted basis on the date of purchase. The Offer is also
conditioned upon, among other things, the expiration or termination of all
waiting periods under the Hart-Scott-Rodino Antitrust Improvements Act of 1976,
as amended, and any other foreign competition and antitrust statutes and
regulations, including the approval of the German Federal Cartel Office pursuant
to the German Act against Restraints of Competition.
The term "Expiration Date" means 12:00 midnight, New York City time, on July
16, 1997, unless and until the Purchaser, in its sole discretion, shall have
extended the period of time during which the Offer is open, in which event the
term "Expiration Date" shall mean the latest time and date at which the Offer,
as so extended by the Purchaser, will expire.
<PAGE>
The Offer is being made pursuant to an Agreement and Plan of Merger dated as
of June 11, 1997 (the "Agreement") among Thyssen, Purchaser and the Company. The
Agreement provides that, among other things, as soon as practicable after the
purchase of Shares pursuant to the Offer and the satisfaction of the other
conditions set forth in the Agreement and in accordance with relevant provisions
of the General Corporation Law of the State of Delaware and the Business
Corporation Law of the State of Wisconsin (the "BCL"), Purchaser will be merged
with and into the Company (the "Merger"). Following consummation of the Merger,
the Company will continue as the surviving corporation (the "Surviving
Corporation") and will become an indirect wholly owned subsidiary of Thyssen. At
the effective time of the Merger (the "Effective Time"), each Share issued and
outstanding immediately prior to the Effective Time (other than Shares held in
the treasury of the Company and any Shares owned by Purchaser, Thyssen or any
direct or indirect wholly owned subsidiary of Thyssen or of the Company, and
other than Shares held by shareholders who shall have demanded and perfected
dissenters' rights, if any, under the BCL) will be canceled and converted
automatically into the right to receive $21.00 in cash, or any higher price that
may be paid per Share in the Offer, without interest.
THE BOARD OF DIRECTORS OF THE COMPANY HAS DETERMINED THAT EACH OF THE OFFER
AND THE MERGER IS FAIR TO, AND IN THE BEST INTERESTS OF, THE SHAREHOLDERS OF THE
COMPANY, AND RECOMMENDS THAT SHAREHOLDERS ACCEPT THE OFFER AND TENDER THEIR
SHARES PURSUANT TO THE OFFER.
For purposes of the Offer, the Purchaser will be deemed to have accepted for
payment, and thereby purchased, Shares validly tendered to the Purchaser and not
withdrawn as, if and when the Purchaser gives oral or written notice to Morgan
Guaranty Trust Company of New York (the "Depositary") of the Purchaser's
acceptance for payment of such Shares. Payment for Shares accepted for payment
pursuant to the Offer will be made by deposit of the purchase price therefor
with the Depositary, which will act as agent for tendering shareholders for the
purpose of receiving payment from the Purchaser and transmitting payment to
tendering shareholders. Under no circumstances will interest be paid on the
purchase price of the Shares to be paid by the Purchaser, regardless of any
extension of the Offer or any delay in making such payment.
In all cases, payment for Shares accepted for payment pursuant to the Offer
will be made only after timely receipt by the Depositary of (a) certificates for
(or a timely Book-Entry Confirmation (as defined in the Offer to Purchase) with
respect to) such Shares, (b) a Letter of Transmittal (or a manually executed
facsimile thereof), properly completed and duly executed, with any required
signature guarantees (or, in the case of a book-entry transfer, an Agent's
Message (as defined in the Offer to Purchase) in lieu of a Letter of
Transmittal) and (c) any other documents required by the Letter of Transmittal.
The per Share consideration paid to any shareholder pursuant to the Offer will
be the highest per Share consideration paid to any other shareholder pursuant to
the Offer.
Except as otherwise provided in the Offer to Purchase, tenders of Shares are
irrevocable. Shares tendered pursuant to the Offer may be withdrawn pursuant to
the procedures set forth in the Offer to Purchase at any time prior to the
Expiration Date and, unless theretofore accepted for payment and paid for by the
Purchaser pursuant to the Offer, may also be withdrawn at any time after August
17, 1997.
For a withdrawal to be effective, a written, telegraphic or facsimile
transmission notice of withdrawal must be timely received by the Depositary at
one of its addresses set forth on the back cover of the Offer to Purchase and
must specify the name of the person having tendered the Shares to be withdrawn,
the number of Shares to be withdrawn and the name of the registered holder of
the Shares to be withdrawn, if different from the name of the person who
tendered the Shares. If certificates for Shares have been delivered or otherwise
identified to the Depositary, then, prior to the physical release of such
certificates, the serial numbers shown on such certificates must be submitted to
the Depositary and, unless such Shares have been tendered by an Eligible
Institution (as defined in Section 3 of the Offer to Purchase), the signatures
on the notice of withdrawal must be guaranteed by an Eligible Institution. If
Shares have been delivered pursuant to the procedures for book-entry transfer as
set forth in Section 3 of the Offer to
2
<PAGE>
Purchase, any notice of withdrawal must also specify the name and number of the
account at the appropriate Book-Entry Transfer Facility (as defined in the Offer
to Purchase) to be credited with the withdrawn Shares and otherwise comply with
such Book-Entry Transfer Facility's procedures. Withdrawals of tenders of Shares
may not be rescinded, and any Shares properly withdrawn will thereafter be
deemed not validly tendered for purposes of the Offer. However, withdrawn Shares
may be retendered by again following one of the procedures described in Section
3 of the Offer to Purchase at any time prior to the Expiration Date.
All questions as to the form and validity (including time of receipt) of
notices of withdrawal will be determined by the Purchaser in its sole
discretion, which determination will be final and binding. None of the
Purchaser, Thyssen, the Depositary, the Information Agent, the Dealer Manager or
any other person will be under any duty to give notification of any defects or
irregularities in any notice of withdrawal or incur any liability for failure to
give such notification.
Subject to the applicable rules and regulations of the Securities and
Exchange Commission, the Purchaser reserves the right, in its sole discretion,
at any time or from time to time, and regardless of whether or not any of the
events set forth in Section 3 of the Offer to Purchase shall have occurred, (a)
to extend the period of time during which the Offer is open, and thereby delay
acceptance for payment of and the payment for any Shares, by giving oral or
written notice of such extension to the Depositary and (b) to amend the Offer in
any other respect by giving oral or written notice of such amendment to the
Depositary.
The information required to be disclosed by paragraph (e)(l)(vii) of Rule
14d-6 under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"), is incorporated herein by reference.
Requests are being made to the Company pursuant to 14d-5 of the Exchange
Act, and pursuant to the Merger Agreement, for the use of the Company's
shareholder lists and security position listings for the purpose of
disseminating the Offer to holders of Shares. The Offer to Purchase, the related
Letter of Transmittal and the other relevant materials will be mailed to record
holders of Shares, and will be furnished to brokers, dealers, banks, trust
companies and similar persons whose names, or the names of whose nominees,
appear on the shareholder lists, or, if applicable, who are listed as
participants in a clearing agency's security position listing, for subsequent
transmittal to beneficial owners of Shares, by the Purchaser following receipt
of such lists or listings from the Company or by the Company if the Company so
elects.
THE OFFER TO PURCHASE AND THE LETTER OF TRANSMITTAL CONTAIN IMPORTANT
INFORMATION THAT SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE WITH
RESPECT TO THE OFFER.
Questions and requests for assistance, or for additional copies of the Offer
to Purchase, the Letter of Transmittal, the Notice of Guaranteed Delivery or
other Offer documents may be directed to the Information Agent or the Dealer
Manager at their respective telephone numbers and addresses listed below.
Holders of Shares may also contact brokers, dealers, commercial banks and trust
companies or other nominees for assistance concerning the Offer. Copies of the
foregoing will be furnished at the Purchaser's expense. No fees or commissions
will be payable to brokers, dealers or other persons other than the Dealer
Manager and the Information Agent for soliciting tenders of Shares pursuant to
the Offer.
3
<PAGE>
THE INFORMATION AGENT FOR THE OFFER IS:
[LOGO]
909 Third Avenue
20th Floor
New York, New York 10022
(212) 754-8000
Toll Free: (800) 566-9061
Banks and Brokerage Firms please call:
(800) 662-5200
THE DEALER MANAGER FOR THE OFFER IS:
MORGAN STANLEY DEAN WITTER
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, New York 10036
(212) 761-6531
June 18, 1997
<PAGE>
[THYSSEN LOGO] GIDDINGS & LEWIS
FOR IMMEDIATE RELEASE
CONTACTS:
FOR THYSSEN AG: FOR GIDDINGS & LEWIS, INC.:
Media Contact: Media Contact:
Pascale Wiedenroth Patricia Meinecke
(011-49-211) 824-36677 (414) 929-4212
Investor Contact: Investor Contact:
Konrad Tamschick Douglas Barnett
(011-49-211) 824-38347 (414) 929-4374
Joele Frank/Patricia Sturms
Abernathy MacGregor Group
(212) 371-5999
THYSSEN AG AND GIDDINGS & LEWIS
SIGN DEFINITIVE MERGER AGREEMENT FOR ACQUISITION OF
GIDDINGS & LEWIS AT $21 PER SHARE IN CASH
- --------------------------------------------------------------------------------
DUESSELDORF, GERMANY and FOND DU LAC, WI, June 12, 1997 - Thyssen AG, a company
based in Duesseldorf, Germany and Giddings & Lewis, Inc. (NASDAQ: GIDL) today
jointly announced that the two companies have signed a definitive merger
agreement for the acquisition of Giddings & Lewis by Thyssen AG at $21 per share
in cash. Giddings & Lewis has approximately 32.1 million shares outstanding on
a fully diluted basis, giving the transaction a total equity value of
approximately $675 million.
Under the terms of the agreement, a subsidiary of Thyssen AG will shortly
commence a tender offer to acquire all of the outstanding shares of Giddings &
Lewis for $21 per share in cash. Following the completion of the tender offer,
Thyssen AG will consummate a second step merger in which remaining Giddings &
Lewis shareholders will also receive the $21 per share in cash.
Giddings & Lewis will continue to operate under the Giddings & Lewis name and
will maintain its headquarters and management team in Fond du Lac, Wisconsin.
<PAGE>
Dr. Dieter H. Vogel, Chairman of Thyssen AG, said, "This merger is about
competitiveness, growth and greater opportunities. Giddings & Lewis is the
ideal fit with Thyssen AG to enhance our core production systems business. The
combination of Thyssen's financial strength and global marketing and sales
capabilities with Giddings & Lewis' market and technology leadership,
established brand names and broad range of related products and services
provides a strong platform for future growth, which we expect to benefit
employees of both organizations."
Mr. Marvin L. Isles, Chairman and Chief Executive Officer of Giddings & Lewis,
Inc., said, "Our Board of Directors unanimously concluded that this transaction
with Thyssen is in the best interests of all of Giddings & Lewis'
constituencies. At $21 per share in cash, Giddings & Lewis shareholders will
receive exceptional value. Backed by Thyssen's financial strength and global
resources, Giddings & Lewis is strategically positioned to focus on our core
purpose - providing customers worldwide with the products and services they need
to improve their manufacturing productivity. We are particularly pleased that
Thyssen has a proven track record in North America of investment, growth and
good corporate citizenship."
Dr. Eckhard Rohkamm, Chairman of Thyssen Industrie AG, the capital goods arm of
Thyssen AG, added, "Together, we can grow our joint customer base and increase
our sales potential, creating new opportunities throughout Giddings & Lewis and
Thyssen. The companies have unparalleled synergies in the global industrial
automation industry - not only in the products and services offered, but also in
geographic coverage, customer base and technical capability. We have the
potential of shared manufacturing capabilities and anticipate that Thyssen
will expand Giddings & Lewis' manufacturing volume by adding Thyssen product
lines to Giddings & Lewis facilities. Giddings & Lewis will be able to
capitalize on Thyssen's European presence to expand its manufacturing
capabilities and global market base. At the same time, Thyssen will have a
greater ability to penetrate North American markets.
"We are committed to growing all of Giddings & Lewis' businesses to better serve
our customers worldwide. Combined, we create the world's premier machine tool
manufacturer, with the global resources and flexibility to deliver exactly what
customers need, whenever and wherever they need it. The merger of our two
companies creates a stronger business positioned to compete successfully on a
global scale," Dr. Rohkamm concluded.
Mr. Isles continued, "Thyssen is the right partner for Giddings & Lewis. We are
like-minded about how to achieve our goals, and Giddings & Lewis' management is
enthusiastic about the value Thyssen adds to our business. The combination with
Thyssen will enable Giddings & Lewis to continue to pursue its growth
objectives, including the expansion of its aftermarket business for the large
installed base of machine tools in the U.S. and overseas. We are very
excited about the combination. Thyssen is committed to enhancing all our
businesses and is knowledgeable about Giddings & Lewis' markets and
customers. It was essential for Giddings & Lewis to join with a company that
is interested in all markets we serve, including our important automotive
segment, which accounts for 50% of our sales."
<PAGE>
"This combination addresses two economic and market forces at work in our
industry today: consolidation and globalization. As these trends continue,
major players will emerge who can meet the needs of global customers. Our
vision for Giddings & Lewis is of a global enterprise with regional sales and
engineering and worldwide manufacturing. We intend to be among the global
players. With this one step, we have achieved that goal. Together with
Thyssen, we have the mass, the global reach, and the industry know-how to
compete successfully today and tomorrow in the increasingly global machine tool
business," Mr. Isles concluded.
Completion of the transaction is subject to antitrust review in the United
States, Germany and certain other countries and Giddings & Lewis stockholder
approval (if necessary) of the second-step merger. Under certain circumstances,
if the agreement were terminated by Giddings & Lewis for another acquisition
transaction, Giddings & Lewis would pay Thyssen a fee of $20 million and
reimburse it for up to $3 million in expenses.
Morgan Stanley & Co. Incorporated served as the financial adviser to Thyssen AG.
Credit Suisse First Boston Corporation served as the financial adviser to
Giddings & Lewis and provided a fairness opinion in connection with the
transaction.
Headquartered in Fond du Lac, Wisconsin, Giddings & Lewis is the largest
supplier of industrial automation products and machine tools in North America,
and among the largest in the world. The company serves customers worldwide with
products and services to improve manufacturing productivity.
Thyssen AG, headquartered in Duesseldorf, is one of Germany's biggest industrial
and commercial enterprises with $26.2 billion in annual revenues and
approximately 113,000 employees around the world. Thyssen has around 320
companies in Germany, the US and numerous other countries. Thyssen AG, through
its subsidiaries, offers capital goods and manufactured products, manufactures
steel products and providers trading and services such as logistics,
distribution of production materials and waste management,
<PAGE>
and lately cellular telephony. The capital goods include automation systems,
machine tools, elevators and automotive supplies.
NOTE TO EDITORS: TODAY'S NEWS RELEASE, ALONG WITH OTHER NEWS ABOUT THYSSEN AND
GIDDINGS & LEWIS, IS AVAILABLE ON THE INTERNET AT HTTP://WWW.THYSSEN.COM AND
HTTP://WWW.GIDDINGS.COM, OR FOR GIDDINGS & LEWIS SIMPLY CALL COMPANY NEWS ON
CALL, 1-800-758-5804, EXT. 119821.
# # #
<PAGE>
EXHIBIT 99.(c)(1)
AGREEMENT AND PLAN OF MERGER
BY AND AMONG
THYSSEN AKTIENGESELLSCHAFT,
TAQU, INC.
and
GIDDINGS & LEWIS, INC.
June 11, 1997
<PAGE>
TABLE OF CONTENTS
Page
----
ARTICLE I
THE OFFER
1.1 The Offer....................................................... 1
1.2 Company Action.................................................. 3
ARTICLE II
THE MERGER; EFFECTIVE TIME; CLOSING
2.1 The Merger...................................................... 5
2.2 Effective Time.................................................. 5
2.3 Closing......................................................... 5
ARTICLE III
SURVIVING CORPORATION
3.1 Articles of Incorporation....................................... 6
3.2 By-Laws......................................................... 6
3.3 Directors....................................................... 6
3.4 Officers........................................................ 6
ARTICLE IV
MERGER CONSIDERATION; CONVERSION OR CANCELLATION OF
SHARES IN THE MERGER
4.1 Share Consideration for the Merger; Conversion or
Cancellation of Shares in the Merger............................ 6
4.2 Shareholders' Meeting........................................... 7
4.3 Payment for Shares in the Merger................................ 8
4.4 Transfer of Shares After the Effective Time..................... 10
4.5 Stock Options................................................... 10
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
5.1 Corporate Organization and Qualification........................ 10
5.2 Capitalization.................................................. 11
5.3 Authority Relative to This Agreement............................ 12
5.4 Consents and Approvals; No Violation............................ 12
-i-
<PAGE>
Page
----
5.5 SEC Reports; Financial Statements............................... 14
5.6 Absence of Certain Changes or Events............................ 15
5.7 Litigation and Liabilities...................................... 15
5.8 Information Supplied............................................ 16
5.9 Taxes........................................................... 16
5.10 Employee Benefit Plans; Labor Matters........................... 17
5.11 Environmental Laws and Regulations.............................. 20
5.12 Brokers and Finders............................................. 21
5.13 Opinions of Financial Advisors.................................. 21
5.14 Compliance with Laws; Permits................................... 21
5.15 Takeover Statutes............................................... 22
5.16 Labor Matters................................................... 22
5.17 Insurance....................................................... 22
5.18 Intellectual Property........................................... 23
5.19 Rights Plan..................................................... 24
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF PARENT
AND NEWCO
6.1 Corporate Organization and Qualification........................ 25
6.2 Authority Relative to This Agreement............................ 25
6.3 Consents and Approvals: No Violation........................... 25
6.4 Financing....................................................... 26
ARTICLE VII
ADDITIONAL COVENANTS AND AGREEMENTS
7.1 Conduct of Business of the Company.............................. 27
7.2 Acquisition Proposals........................................... 30
7.3 Approvals and Consents; Cooperation............................. 31
7.4 Further Assurances.............................................. 31
7.5 Access to Information........................................... 32
7.6 Publicity....................................................... 32
7.7 Indemnification of Directors and Officers....................... 33
7.8 Employees....................................................... 34
7.9 Notification of Certain Matters................................. 35
7.10 Company Board................................................... 35
ARTICLE VIII
CONDITIONS TO CONSUMMATION OF THE MERGER
-ii-
<PAGE>
Page
----
8.1 Conditions to Each Party's Obligations to Effect the
Merger.......................................................... 36
ARTICLE IX
TERMINATION; AMENDMENT; WAIVER
9.1 Termination by Mutual Consent................................... 37
9.2 Termination by Either Parent or the Company..................... 37
9.3 Termination by the Company...................................... 37
9.4 Termination by Parent........................................... 38
9.5 Effect of Termination and Abandonment........................... 39
9.6 Extension; Waiver............................................... 40
ARTICLE X
MISCELLANEOUS AND GENERAL
10.1 Payment of Expenses............................................ 40
10.2 Survival of Representations and Warranties; Survival
of Confidentiality.............................................. 40
10.3 Modification or Amendment...................................... 40
10.4 Waiver of Conditions........................................... 40
10.5 Counterparts................................................... 40
10.6 Governing Law.................................................. 40
10.7 Notices........................................................ 41
10.8 Entire Agreement; Assignment................................... 43
10.9 Parties in Interest............................................ 43
10.10 Certain Definitions............................................. 43
10.11 Obligation of Parent............................................ 43
10.12 Validity........................................................ 44
10.13 Captions........................................................ 44
Annex A
ANNEX A.............................................................. A-1
-iii-
<PAGE>
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER (this "Agreement"), dated as of June
11, 1997, by and among Thyssen Aktiengesellschaft,a stock corporation organized
under the laws of Germany ("Parent"), TAQU, Inc., a Delaware corporation and an
indirect wholly owned subsidiary of Parent ("Newco"), and Giddings & Lewis,
Inc., a Wisconsin corporation (the "Company").
RECITALS
WHEREAS, the Board of Directors of the Company, has, subject to the
conditions of this Agreement, unanimously determined that each of the Offer and
the Merger (each as defined below) is in the best interests of the shareholders
of the Company and approved and adopted this Agreement and the transactions
contemplated hereby; and
WHEREAS, in furtherance thereof, it is proposed that Newco shall
make a tender offer (the "Offer") to acquire all of the outstanding shares (the
"Shares") of Common Stock, par value $.10 per share (the "Company Common
Stock"), of the Company, together with the associated Rights (as hereafter
defined), at a price of $21 per Share (such amount, or any greater amount per
share paid pursuant to the Offer, being hereinafter referred to as the "Per
Share Amount"), net to the seller in cash, in accordance with the terms and
subject to the conditions of this Agreement; and
WHEREAS, Parent, Newco and the Company desire to make certain
representations, warranties, covenants and agreements in connection with the
Offer and the Merger.
NOW, THEREFORE, in consideration of the foregoing and the mutual
representations, warranties, covenants and agreements set forth herein, Parent,
Newco and the Company hereby agree as follows:
ARTICLE I
THE OFFER
1.1 The Offer.
(a) Provided that this Agreement shall not have been
terminated in accordance with Article IX, Newco shall
<PAGE>
commence the Offer not later than the fifth business day from and including the
date of initial public announcement of this Agreement. Newco shall accept for
payment Shares which have been validly tendered and not withdrawn pursuant to
the Offer at the earliest time following expiration of the Offer that all
conditions to the Offer shall have been satisfied or waived by Newco. The
obligation of Newco to accept for payment, purchase and pay for Shares tendered
pursuant to the Offer shall be subject only to such conditions and to the
further condition that a number of Shares representing not less than a majority
of the Shares then outstanding on a fully diluted basis shall have been validly
tendered and not withdrawn prior to the final expiration date of the Offer (the
"Minimum Condition"). Unless previously approved by the Company in writing, no
change in the Offer may be made (i) which decreases the price per Share payable
in the Offer, (ii) which changes the form of consideration to be paid in the
Offer, (iii) which reduces the maximum number of Shares to be purchased in the
Offer or the Minimum Condition, (iv) which imposes conditions to the Offer in
addition to those set forth in Annex A hereto or which modifies the conditions
set forth in Annex A in a manner adverse to the holders of Shares or (v) which
amends any other term of the Offer in a manner adverse to the holders of the
Shares. Notwithstanding the foregoing, Newco may, without the consent of the
Company, (i) extend the Offer on one or more occasions for up to ten business
days for each such extension beyond the then scheduled expiration date (the
initial scheduled expiration date being 20 business days following commencement
of the Offer), if at the then scheduled expiration date of the Offer any of the
conditions to Newco's obligation to accept for payment and pay for the Shares
shall not be satisfied or waived, until such time as such conditions are
satisfied or waived (and, at the request of the Company, Newco shall, subject to
Parent's right to terminate this Agreement pursuant to Article IX, extend the
Offer for additional periods, unless the only conditions not satisfied or
earlier waived on the then scheduled expiration date are one or more of the
Minimum Condition and the conditions set forth in paragraphs (b) and (e) of
Annex A hereto, provided that (x) if the only condition not satisfied is the
Minimum Condition, the satisfaction or waiver of all other conditions shall have
been publicly disclosed at least five business days before termination of the
Offer and (y) if paragraph (b) of Annex A hereto has not been satisfied and the
failure to so satisfy can be remedied, the Offer shall not be terminated unless
the failure is not remedied within 30 calendar days after Parent has furnished
the Company written notice of such failure), (ii) extend the Offer for any
period required by any rule, regulation, interpretation or position of the
-2-
<PAGE>
Securities and Exchange Commission (the "SEC") or the staff thereof applicable
to the Offer and (iii) extend the Offer for an aggregate period of not more than
5 business days beyond the latest expiration date that would otherwise be
permitted under clause (i) or (ii) of this sentence if there shall not have been
tendered sufficient Shares so that the Merger could be effected without a
meeting of the Company's shareholders in accordance with Section 180.1104 of the
Wisconsin Business Corporation Law (the "BCL"). Subject to the terms and
conditions of the Offer and this Agreement, Newco shall, and Parent shall cause
Newco to, pay for all Shares validly tendered and not withdrawn pursuant to the
Offer that Newco becomes obligated to purchase pursuant to the Offer as soon as
practicable after the expiration of the Offer.
(b) As soon as practicable on the date of commencement of the
Offer, Newco shall file with the SEC a Tender Offer Statement on Schedule 14D-1
with respect to the Offer (together with any supplement or amendments thereto,
the "Offer Documents"). The Offer Documents will comply in all material respects
with the provisions of applicable federal securities laws. Parent, Newco and the
Company each agree promptly to correct any information provided by them for use
in the Offer Documents if and to the extent that it shall have become false or
misleading in any material respect and Newco further agrees to take all steps
necessary to cause the Offer Documents as so corrected to be filed with the SEC
and to be disseminated to holders of Shares, in each case as and to the extent
required by applicable federal securities laws. To the extent practicable, the
Company and its counsel shall be given an opportunity to review and comment upon
the Offer Documents and any amendments thereto prior to the filing thereof with
the SEC.
1.2 Company Action
(a) The Company hereby approves of and consents to the Offer
and represents that the Board of Directors, including all of the disinterested
directors, at a meeting duly called and held, has, subject to the terms and
conditions set forth herein, (i) approved this Agreement and the transactions
contemplated hereby, including the Offer and the Merger, and that such approval
constitutes approval of the Offer, this Agreement and the Merger for purposes of
Section 180.1141 of the BCL, and (ii) resolved to recommend that the
shareholders of the Company accept the Offer, tender their Shares thereunder to
Newco and approve and adopt this Agreement and Merger; provided, that such
recommendation may be withdrawn, modified or amended if, the
-3-
<PAGE>
Company reasonably determines in good faith, based on the advice of outside
legal counsel to the Company, that such action is necessary in order for the
Board of Directors of the Company to comply with its fiduciary duties under
applicable law. The Company consents to the inclusion of such recommendation and
approval in the Offer Documents.
(b) The Company hereby agrees to file with the SEC as soon as
practicable on the date of commencement of the Offer a Solicitation/
Recommendation Statement on Schedule 14D-9 (together with any amendments or
supplements thereto, the "Schedule 14D-9") containing the recommendation
described in Section 1.2(a). The Schedule 14D-9 will comply in all material
respects with the provisions of applicable federal securities laws. The Company,
Parent and Newco each agree promptly to correct any information provided by them
for use in the Schedule 14D-9 if and to the extent that it shall have become
false or misleading in any material respect and the Company further agrees to
take all steps necessary to cause the Schedule 14D-9 as so corrected to be filed
with the SEC and disseminated to the holders of Shares, in each case as and to
the extent required by applicable federal securities laws. Notwithstanding
anything to the contrary in this Agreement, the Board of Directors may withdraw,
modify or amend its recommendation if the Company reasonably determines in good
faith, based on the advice of outside legal counsel to the Company, that such
action is necessary in order for the Board of Directors of the Company to comply
with its fiduciary duties under applicable law. To the extent practicable,
Parent and its counsel shall be given an opportunity to review and comment upon
the Schedule 14D-9 and any amendments thereto prior to the filing thereof with
the SEC.
(c) In connection with the Offer, the Company will promptly
furnish Parent and Newco with mailing labels, security position listings and any
available listing or computer files containing the names and addresses of the
record holders of the Shares as of a recent date and shall furnish Newco with
such additional information and assistance (including, without limitation,
updated lists of shareholders, mailing labels and lists of securities positions)
as Newco or its agents may reasonably request in communicating the Offer to the
record and beneficial holders of Shares. Subject to the requirements of
applicable law, and except for such steps as are necessary to disseminate the
Offer Documents and any other documents necessary to consummate the Merger,
Parent, Newco and their affiliates, associates, agents and advisors shall use
the information contained in any such labels, listings and files only in
-4-
<PAGE>
connection with the Offer and the Merger, and, if this Agreement shall be
terminated, will deliver to the Company all copies of such information then in
their possession.
ARTICLE II
THE MERGER; EFFECTIVE TIME; CLOSING
2.1 The Merger. Subject to the terms and conditions of this
Agreement, at the Effective Time (as defined in Section 2.2), the Company and
Newco shall consummate a merger (the "Merger") in which (a) Newco shall be
merged with and into the Company and the separate corporate existence of Newco
shall thereupon cease, (b) the Company shall be the successor or surviving
corporation in the Merger and shall continue to be governed by the laws of the
State of Wisconsin, and (c) the separate corporate existence of the Company with
all its rights, privileges, immunities, powers and franchises shall continue
unaffected by the Merger. The corporation surviving the Merger is sometimes
hereinafter referred to as the "Surviving Corporation." The Merger shall have
the effects set forth in Section 180.1106 of the BCL and Section 259 of the
Delaware General Corporation Law (the "DGCL").
2.2 Effective Time. Parent, Newco and the Company will cause
appropriate Articles of Merger (the "Articles of Merger") and an appropriate
Certificate of Merger (the "Certificate of Merger") to be executed and filed on
the date of the Closing (as defined in Section 2.3) (or on such other date as
Parent and the Company may agree) as provided in the BCL and the DGCL. The
Merger shall become effective upon the latest to occur of (i) the date on which
the Articles of Merger have been received for filing by the Department of
Financial Institutions of the State of Wisconsin, (ii) the date on which the
Certificate of Merger is filed with the Secretary of State of the State of
Delaware, or (iii) such later date as is agreed upon by the parties and
specified in the Articles of Merger and Certificate of Merger, and the time of
such effectiveness is hereinafter referred to as the "Effective Time."
2.3 Closing. The closing of the Merger (the "Closing") shall take
place (a) at the offices of Skadden, Arps, Slate, Meagher & Flom (Illinois), 333
West Wacker Drive, Chicago, Illinois, at 10:00 a.m., local time, on the first
business day following the date on which the last of the conditions set forth in
Article VIII hereof shall be fulfilled or waived in accordance
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with this Agreement or (b) at such other place, time and date as Parent and the
Company may agree.
ARTICLE III
SURVIVING CORPORATION
3.1 Articles of Incorporation. The Articles of Incorporation (the
"Articles of Incorporation") of Newco, as in effect immediately prior to the
Effective Time, shall be the Articles of Incorporation of the Surviving
Corporation.
3.2 By-Laws. The By-Laws of Newco, as in effect immediately prior to
the Effective Time, shall be the By-Laws of the Surviving Corporation.
3.3 Directors. The directors of Newco at the Effective Time shall,
from and after the Effective Time, be the initial directors of the Surviving
Corporation until their successors have been duly elected or appointed and
qualified or until their earlier death, resignation or removal in accordance
with the Surviving Corporation's Articles of Incorporation and By-Laws.
3.4 Officers. The officers of the Company at the Effective Time
shall, from and after the Effective Time, be the initial officers of the
Surviving Corporation until their successors have been duly elected or appointed
and qualified or until their earlier death, resignation or removal in accordance
with the Surviving Corporation's Articles of Incorporation and By-Laws.
ARTICLE IV
MERGER CONSIDERATION; CONVERSION OR CANCELLATION OF
SHARES IN THE MERGER
4.1 Share Consideration for the Merger; Conversion or Cancellation
of Shares in the Merger. At the Effective Time, by virtue of the Merger and
without any action on the part of the holders of any Shares or capital stock of
Newco:
(a) Each Share, together with any preferred stock purchase
rights (the "Rights"), issued pursuant to the Rights Agreement, dated as of
August 23, 1995, by and between the
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Company and Firstar Trust Company, as Rights Agent (the "Rights Agreement"),
that are issued and outstanding immediately prior to the Effective Time (other
than Shares (and Rights) owned by Parent, Newco or any direct or indirect wholly
owned subsidiary of Parent (collectively, "Parent Companies") or any of the
Company's direct or indirect wholly owned subsidiaries or shares held in the
treasury of the Company) shall, by virtue of the Merger and without any action
on the part of Newco, the Company or the holder thereof, be cancelled and
extinguished and converted into the right to receive, pursuant to Section 4.3,
the Per Share Amount in cash (the "Merger Consideration"), payable to the holder
thereof, without interest thereon, less any required withholding of taxes, upon
the surrender of the certificate formerly representing such Share.
(b) Each Share issued and outstanding and owned by any of the
Parent Companies or any of the Company's direct or indirect wholly owned
subsidiaries or authorized but unissued shares held by the Company immediately
prior to the Effective Time shall cease to be outstanding, be cancelled and
retired without payment of any consideration therefor and cease to exist.
(c) Each share of common stock of Newco issued and outstanding
immediately prior to the Effective Time shall be converted into one validly
issued, fully paid and nonassessable share of common stock of the Surviving
Corporation.
4.2 Shareholders' Meeting. (a) The Company, acting through the Board
of Directors, shall, if required by applicable law:
(i) duly call, give notice of, convene and hold a
special meeting of its shareholders (the "Shareholders Meeting"), to be
held as soon as practicable after Newco shall have purchased Shares
pursuant to the Offer, for the purpose of considering and taking action
upon this Agreement;
(ii) include in the Proxy Statement the
recommendation of the Board of Directors that shareholders of the Company
vote in favor of the approval of this Agreement and the transactions
contemplated hereby unless the Company reasonably determines in good
faith, based on the advice of outside legal counsel to the Company, that
excluding such recommendation is necessary in order for the
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Board of Directors of the Company to comply with its fiduciary duties
under applicable law; and
(iii) use all reasonable efforts (A) to obtain and
furnish the information required to be included by it in the Proxy
Statement and, after consultation with Parent and Newco, respond promptly
to any comments made by the SEC with respect to the Proxy Statement and
any preliminary version thereof and cause the Proxy Statement to be mailed
to its shareholders at the earliest practicable time following the
expiration or termination of the Offer and (b) obtain the necessary
approvals by its shareholders of this Agreement and the transactions
contemplated hereby unless, the Company reasonably determines in good
faith, based on the advice of outside legal counsel to the Company, that
not taking any such action is necessary in order for the Board of
Directors of the Company to comply with its fiduciary duties under
applicable law.
At such meeting, Parent, Newco and their affiliates will vote all
Shares owned by them in favor of approval of this Agreement and the transactions
contemplated hereby.
(b) Notwithstanding the foregoing, in the event that Newco
shall acquire at least 90 percent of the then outstanding Shares, the parties
hereto agree, at the request of Newco, subject to Article VIII, to take all
necessary and appropriate action to cause the Merger to become effective, in
accordance with Section 180.1104 of the BCL, as soon as reasonably practicable
after such acquisition, without a meeting of the shareholders of the Company.
4.3 Payment for Shares in the Merger. The manner of making payment
for Shares in the Merger shall be as follows:
(a) At the Effective Time, Parent shall make available to J.P.
Morgan & Co. Inc. (the "Exchange Agent"), or such other exchange agent selected
by Parent and reasonably acceptable to the Company, for the benefit of the
holders of Shares, the funds necessary to make the payments contemplated by
Section 4.1 (the "Exchange Fund"). The Exchange Agent shall, pursuant to
irrevocable instructions, deliver the Merger Consideration out of the Exchange
Fund. The Exchange Fund shall not be used for any other purpose.
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(b) As soon as reasonably practicable, after the Effective
Time, the Exchange Agent shall mail to each holder of record (other than holders
of certificates representing Shares referred to in Section 4.1(b)) of a
certificate or certificates which immediately prior to the Effective Time
represented outstanding Shares (the "Certificates") (i) a form of letter of
transmittal (which shall specify that delivery shall be effected, and risk of
loss and title to the Certificates shall pass, only upon proper delivery of the
Certificates to the Exchange Agent) and (ii) instructions for use in effecting
the surrender of the Certificates for payment therefor. Upon surrender of
Certificates for cancellation to the Exchange Agent, together with such letter
of transmittal duly executed and any other required documents, the holder of
such Certificates shall be entitled to receive for each of the Shares
represented by such Certificates the Merger Consideration, without any interest
thereon, less any required withholding of taxes, and the Certificates so
surrendered shall forthwith be cancelled. Until so surrendered, such
Certificates shall represent solely the right to receive the Merger
Consideration with respect to each of the Shares represented thereby. If payment
is to be made to a person other than the person in whose name a Certificate so
surrendered is registered, it shall be a condition of payment that the
Certificate so surrendered shall be properly endorsed and otherwise in proper
form for transfer and that the person requesting such payment shall pay to the
Exchange Agent any transfer or other taxes required by reason of the payment to
a person other than the registered holder of the Certificate surrendered, or
shall establish to the satisfaction of the Exchange Agent that such tax has been
paid or is not applicable. Until surrendered in accordance with the provisions
of this Section 4.3(b), each Certificate (other than Certificates representing
Shares referred to in Section 4.1(b)) shall represent for all purposes only the
right to receive, for each Share represented thereby, the Merger Consideration.
(c) Any portion of the Exchange Fund made available to the
Exchange Agent which remains unclaimed by the former shareholders of the Company
one year after the Effective Time shall be delivered to Thyssen Holding
Corporation, the direct parent company of Newco, upon demand of Parent, and any
former shareholders of the Company shall thereafter look only to Thyssen Holding
Corporation for payment of their claim for the Merger Consideration for the
Shares.
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4.4 Transfer of Shares After the Effective Time. No transfers of
Shares shall be made on the stock transfer books of the Company after the
Effective Time.
4.5 Stock Options.
(a) Each option granted to a Company employee, consultant or
director to acquire shares of Company Stock ("Option") that is outstanding
immediately prior to the Effective Time, whether or not then vested or
exercisable, with respect to which, as of the Effective Time, the Per Share
Amount exceeds the exercise price per share shall, effective as of immediately
prior to the Effective Time, be cancelled in exchange for a single lump sum cash
payment equal to the product of (1) the number of shares of Company Common Stock
subject to such Option and (2) the excess of the Per Share Amount over the
exercise price per share of such Option.
(b) Each Option that is outstanding immediately prior to the
Effective Time, whether or not then vested or exercisable, shall, effective as
of the Effective Time, with respect to which, as of the Effective Time, the Per
Share Amount does not exceed the exercise price per share shall, effective as of
immediately prior to the Effective Time, be cancelled and no payments shall be
made with respect thereto.
(c) Prior to the Effective Time, the Company shall use all
reasonable efforts to obtain any consents from holders of Options as are
necessary to give effect to the provisions of paragraphs (a) and (b) of this
Section 4.5.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company hereby represents and warrants to Parent and Newco that:
5.1 Corporate Organization and Qualification. Each of the Company
and its Subsidiaries (as defined in Section 10.10) is a corporation duly
organized, validly existing and in good standing under the laws of its
respective jurisdiction of incorporation and is qualified and in good standing
as a foreign corporation in each jurisdiction where the properties owned, leased
or operated, or the business conducted, by it require such qualification, except
where failure to so qualify or be in good
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standing is not reasonably likely to have a Material Adverse Effect (as defined
in Section 10.10). Each of the Company and its Subsidiaries has all requisite
power and authority (corporate or otherwise) to own its properties and to carry
on its business as it is now being conducted. The Company has heretofore made
available to Parent complete and correct copies of its and its Significant
Subsidiaries' Articles of Incorporation and By-Laws or other organizational
documents as in effect on the date hereof. Schedule 5.1 contains a correct and
complete list of each jurisdiction where the Company and each of its Significant
Subsidiaries is organized and qualified to do business.
5.2 Capitalization. The authorized capital stock of the Company
consists of (i) 70,000,000 shares of Company Common Stock which, as of June 6,
1997, 31,043,365 Shares were issued and outstanding and (ii) 3,000,000 shares of
Class A Preferred Stock, par value $.10 share (the "Preferred Stock"), none of
which is issued or outstanding. All of the outstanding shares of capital stock
of the Company have been duly authorized and validly issued and are fully paid
and nonassessable (except as provided in Section 180.0622(2)(b) of the BCL and
judicial interpretations thereof). As of June 6, 1997, (i) 1,643,483 shares of
Company Common Stock were reserved for issuance upon exercise of outstanding
options pursuant to the Option Plans, and (ii) 700,000 shares of Preferred Stock
were reserved for issuance in connection with the Rights. Except as set forth on
Schedule 5.2, as of the date hereof all outstanding shares of capital stock of
the Company's Significant Subsidiaries are owned by the Company or a direct or
indirect wholly owned subsidiary of the Company, free and clear of all liens,
charges, encumbrances, claims and options of any nature. Except as set forth
above and on Schedule 5.2 (which includes a correct and complete list of each
outstanding option to purchase Shares, including the holder, date of grant,
exercise price and number of Shares subject thereto), there are not, as of the
date hereof, any outstanding or authorized options, warrants, calls, rights
(including preemptive rights), commitments or any other agreements of any
character which the Company or any of its Significant Subsidiaries is a party
to, or may be bound by, requiring it to issue, transfer, sell, purchase, redeem
or acquire any shares of capital stock or any securities or rights convertible
into, exchangeable for, or evidencing the right to subscribe for, any shares of
capital stock of the Company or any of its Significant Subsidiaries. The Company
does not have outstanding any bonds, debentures, notes or other obligations the
holders of which have the right to vote (or which are convertible into or
exercisable
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for securities having the right to vote) with the shareholders of
the Company on any matter.
5.3 Authority Relative to This Agreement.
(a) The Company has the requisite corporate power and
authority to execute and deliver this Agreement and to consummate the
transactions contemplated hereby. This Agreement and the consummation by the
Company of the transactions contemplated hereby have been duly and validly
authorized by the Board of Directors of the Company and no other corporate
proceedings on the part of the Company are necessary to authorize this Agreement
or to consummate the transactions contemplated hereby (other than, with respect
to the Merger, the approval of this Agreement by the shareholders of the
Company, including Newco, in accordance with the BCL and the Company's Articles
of Incorporation). This Agreement has been duly and validly executed and
delivered by the Company and, assuming this Agreement constitutes the valid and
binding agreement of Parent and Newco, constitutes the valid and binding
agreement of the Company, enforceable against the Company in accordance with its
terms, except that the enforcement hereof may be limited by (i) bankruptcy,
insolvency, reorganization, moratorium or other similar laws now or hereafter in
effect relating to creditors' rights generally and (ii) general principles of
equity (regardless of whether enforceability is considered in a proceeding in
equity or at law).
(b) The Board of Directors of the Company has duly and validly
approved and taken all corporate action required to be taken by the Board of
Directors for the consummation of the transactions (including the Offer, the
acquisition of Shares pursuant to the Offer and the Merger) contemplated herein
in accordance with the terms hereof, including but not limited to, all actions
required to (i) render the provisions of Section 180.1141 of the BCL restricting
business combinations with "interested stockholders" inapplicable to such
transactions and (ii) amend the Rights Agreement to provide that certificates
with respect to the Rights will not be distributed and the Rights will not
become exercisable as a result of any of the execution of this Agreement, the
commencement or consummation of the Offer or the consummation of the Merger.
5.4 Consents and Approvals; No Violation. Neither the execution and
delivery of this Agreement nor the consummation by the Company of the
transactions contemplated hereby will (a) conflict with or result in any breach
of any provision of the
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respective Articles of Incorporation or By-Laws of the Company or any of its
Significant Subsidiaries; (b) require any consent, approval, authorization or
permit of, or filing with or notification to, any governmental or regulatory
authority, except (i) in connection with the applicable requirements of the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR
Act"), (ii) pursuant to the applicable requirements of the Securities Exchange
Act of 1934, as amended, and the rules and regulations promulgated thereunder
(the "Exchange Act"), (iii) the filing of the Articles of Merger pursuant to the
BCL and appropriate documents with the relevant authorities of other states in
which the Company or any of its subsidiaries is authorized to do business, (iv)
in connection with any state or local tax which is attributable to the
beneficial ownership of the Company's or its subsidiaries' real property, if any
(collectively, the "Gains Taxes"), (v) as may be required by any applicable
state securities or "blue sky" laws or state takeover laws, (vi) such filings
and consents as may be required under any environmental, health or safety law or
regulation pertaining to any notification, disclosure or required approval
triggered by the Merger or the transactions contemplated by this Agreement,
(vii) such filings, consents, approvals, orders, registrations and declarations
as may be required under the laws of any foreign country in which the Company or
any of its subsidiaries conducts any business or owns any assets, or (viii)
where the failure to obtain such consent, approval, authorization or permit, or
to make such filing or notification, would not be reasonably likely to, in the
aggregate, have a Material Adverse Effect or prevent, materially delay or
materially impair the ability of the Company to consummate the transactions
contemplated by this Agreement; (c) except as set forth in Schedule 5.4(c),
result in a violation or breach of, or constitute (with or without due notice or
lapse of time or both) a default (or give rise to any right of termination,
cancellation or acceleration or lien or other charge or encumbrance) under any
of the terms, conditions or provisions of any note, license, agreement or other
instrument or obligation to which the Company or any of its Significant
Subsidiaries or any of their assets may be bound, except for such violations,
breaches and defaults (or rights of termination, cancellation or acceleration or
lien or other charge or encumbrance) as to which requisite waivers or consents
have been obtained or which, in the aggregate, would not be reasonably likely to
have a Material Adverse Effect or prevent, materially delay or materially impair
the ability of the Company to consummate the transactions contemplated by this
Agreement; or (d) assuming the consents, approvals, authorizations or permits
and filings or notifications referred to in this Section 5.4 are duly and timely
obtained or
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made and, with respect to the Merger, the approval of this Agreement by the
Company's shareholders has been obtained, violate any order, writ, injunction,
decree, statute, rule or regulation applicable to the Company or any of its
subsidiaries or to any of their respective assets, except for violations which
would not in the aggregate be reasonably likely to have a Material Adverse
Effect or prevent, materially delay or materially impair the ability of the
Company to consummate the transactions contemplated by this Agreement. Schedule
5.4 set forth a correct and complete list of all agreements, leases, contracts,
notes, mortgages, indentures, arrangements or other obligations binding upon the
Company or any of its Subsidiaries pursuant to which consents or waivers are or
may be required prior to consummation of the transactions contemplated by this
Agreement, except where the failure to obtain such consents or waivers would not
in the aggregate be reasonably likely to have a Material Adverse Effect or
prevent, materially delay or materially impair the ability of the Company to
consummate the transactions contemplated by this Agreement.
5.5 SEC Reports; Financial Statements.
(a) The Company has filed all periodic reports and other
documents required to be filed by it under the Exchange Act with the SEC since
April 1, 1996 pursuant to the federal securities laws and the SEC rules and
regulations thereunder, all of which, as of their respective filing dates,
complied in all material respects with all applicable requirements of the
Exchange Act (as such post-April 1, 1996 documents have been amended since the
time of their filing, collectively, the "Company SEC Reports"). None of the
Company SEC Reports filed prior to the date hereof, including, without
limitation, any financial statements or schedules included therein, as of their
respective dates or, if amended, as of the date of the last such amendment,
contained, and any Company SEC Reports filed subsequent to the date hereof, will
not contain, any untrue statement of a material fact or omitted, or will omit,
to state a material fact required to be stated therein or necessary in order to
make the statements therein, in light of the circumstances under which they were
made, or will be made, not misleading.
(b) The consolidated balance sheets and the related statements
of consolidated income, shareholders' equity and cash flows (including the
related notes thereto) of the Company included in the Company SEC Reports filed
prior to the date hereof, and to be included in the Company SEC Reports filed on
or subsequent to the date hereof, as of their respective
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filing dates, complied, and will comply, in all material respects with
applicable accounting requirements and the published rules and regulations of
the SEC with respect thereto, have been prepared, and will be prepared, in
accordance with generally accepted accounting principles applied on a basis
consistent with prior periods (except as otherwise noted therein), and present,
and will present, fairly the consolidated financial position of the Company and
its consolidated subsidiaries as of their respective dates, and the consolidated
results of their operations and their cash flows for the periods presented
therein (subject, in the case of the unaudited interim financial statements, to
normal year-end adjustments).
5.6 Absence of Certain Changes or Events. Except as disclosed in the
Company SEC Reports filed prior to the date hereof, as set forth on Schedule 5.6
or as contemplated by this Agreement, since December 31, 1996 the business of
the Company has been carried on only in the ordinary and usual course, and there
has not been any change in the financial condition, properties, business or
results of operations of the Company and its Subsidiaries or any development or
combination of developments of which management of the Company and its
Subsidiaries has knowledge that, individually or in the aggregate, has had or is
reasonably likely to have a Material Adverse Effect.
5.7 Litigation and Liabilities. Except as set forth on Schedule 5.7
or as disclosed in the Company SEC Reports filed prior to the date hereof, there
are no (i) civil, criminal or administrative actions, suits, claims, hearings,
investigations or proceedings pending or, to the knowledge of management of the
Company and its Subsidiaries, threatened against the Company or any of its
Subsidiaries or (ii) obligations or liabilities, whether or not accrued,
contingent or otherwise and whether or not required to be disclosed in the
Company SEC Reports, or any other facts or circumstances of which management of
the Company and its Subsidiaries has knowledge that could result in any claims
against, or obligations or liabilities of, the Company or any of its
Subsidiaries, except, in the case of clauses (i) or (ii), for those that are
not, individually or in the aggregate, reasonably likely to have a Material
Adverse Effect or prevent or materially burden or materially impair the ability
of the Company to consummate the transactions contemplated by this Agreement.
5.8 Information Supplied. None of the information supplied by the
Company in writing for inclusion in the Offer Documents or provided by the
Company in the Schedule 14D-9 will,
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at the respective times that the Offer Documents and the Schedule 14D-9 or any
amendments or supplements thereto are filed with the SEC and are first published
or sent or given to holders of Shares, contain any untrue statement of a
material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading.
5.9 Taxes. Except as set forth on Schedule 5.9, the Company and each
of its Subsidiaries (or any consolidated, combined, unitary, aggregate or other
similar group for tax purposes of which any of the Company of its Subsidiaries
is a member) (i) have prepared in good faith and duly and timely filed (taking
into account any extension of time within which to file) all material Tax
Returns (as defined below) required to be filed by any of them on or before the
date of this Agreement and all such filed material Tax Returns are complete and
accurate in all material respects; (ii) have paid all Taxes (as defined below)
that are required to be paid or that the Company or any of its Subsidiaries are
obligated to withhold from amounts owing to any employee, creditor or third
party on or before the date of this Agreement, except with respect to matters
contested in good faith and have recorded as reserves on the consolidated
balance sheets all Taxes which have accrued before the date of this Agreement
but which are not yet due and payable; and (iii) have not waived any statute of
limitations with respect to Taxes or agreed to any extension of time with
respect to a Tax assessment or deficiency. Except as set forth on Schedule 5.9,
as of the date hereof, there are not pending or, to the knowledge of management
of the Company and its Subsidiaries, threatened in writing, any audits,
examinations, investigations or other proceedings in respect of Taxes or Tax
matters. Except as set forth on Schedule 5.9, there are not, to the knowledge of
management of the Company and its Subsidiaries, any unresolved questions or
claims concerning the Company's or any of its Subsidiaries' Tax liability that
are reasonably likely to have a Material Adverse Effect. There are no liens for,
or in respect of, Taxes on any of the assets of the Company or its Subsidiaries,
except with respect to matters being contested in good faith, other than liens
for current Taxes which are not yet due or payable. Except as set forth on
Schedule 5.9, neither the Company nor any Subsidiary owes any amount pursuant to
any written or unwritten Tax sharing or indemnity agreement, or will have any
liability after the date hereof for any amounts due under or in respect of any
such agreement. The Company has made available to Parent true and correct copies
of the United States federal income Tax Returns filed by the Company and its
Subsidiaries for each of the last three fiscal years.
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As used in this Agreement, (i) the term "Tax" (including, with
correlative meaning, the terms "Taxes", and "Taxable") includes all federal,
state, local and foreign income, profits, franchise, gross receipts,
environmental, customs duty, capital stock, severance, stamp, payroll, sales,
employment, unemployment, disability, use, property, withholding, excise,
production, value added, occupancy and other taxes, duties or assessments of any
nature whatsoever, together with all interest, penalties and additions imposed
with respect to such amounts and any interest in respect of such penalties and
additions, and (ii) the term "Tax Return" includes all returns and reports
(including elections, declarations, disclosures, schedules, estimates and
information returns) required to be supplied to a Tax authority relating to
Taxes.
5.10 Employee Benefit Plans; Labor Matters.
(a) All benefit and compensation plans, contracts, policies or
arrangements covering current employees or former employees of the Company and
its subsidiaries (the "Employees") and current or former directors of the
Company, including, but not limited to, "employee benefit plans" within the
meaning of Section 3(3) of the Employee Retirement Income Security Act of 1974,
as amended ("ERISA"), and deferred compensation, stock option, stock purchase,
stock appreciation rights, stock based, incentive and bonus plans (the "Benefit
Plans"), are listed in Schedule 5.10. True and complete copies of all Benefit
Plans, including, but not limited to, any trust instruments and insurance
contracts forming a part of any Benefit Plans, and all amendments thereto have
been provided or made available to Purchaser.
(b) Except as set forth on Schedule 5.10, all Benefit Plans,
other than "multiemployer plans" within the meaning of Section 3(37) of ERISA,
covering Employees (the "Plans"), to the extent subject to ERISA, are in
substantial compliance with ERISA. Except as set forth on Schedule 5.10, each
Plan which is an "employee pension benefit plan" within the meaning of Section
3(2) of ERISA ("Pension Plan") and which is intended to be qualified under
Section 401(a) of the Internal Revenue Code of 1986, as amended (the "Code"),
has received a favorable determination letter from the Internal Revenue Service
with respect to "TRA" (as defined in Section 1 of Rev. Proc. 93-39), and
management of the Company and its Subsidiaries is not aware of any circumstances
likely to result in revocation of any such favorable determination letter. There
is no material pending or threatened litigation relating to the Plans. Neither
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the Company nor any of its subsidiaries has engaged in a transaction with
respect to any Plan that, assuming the taxable period of such transaction
expired as of the date hereof, could subject the Company or any subsidiary to a
tax or penalty imposed by either Section 4975 of the Code or Section 502(i) of
ERISA in an amount which would be material.
(c) No liability under Subtitle C or D of Title IV of ERISA
has been or is expected to be incurred by the Company or any of its subsidiaries
with respect to any ongoing, frozen or terminated "single-employer plan", within
the meaning of Section 4001(a)(15) of ERISA, currently or formerly maintained by
any of them, or the single-employer plan of any entity which is considered one
employer with the Company under Section 4001 of ERISA or Section 414 of the Code
(an "ERISA Affiliate"). The Company and the subsidiaries have not incurred and
do not expect to incur any withdrawal liability with respect to a multiemployer
plan under Subtitle E of Title IV of ERISA (regardless of whether based on
contributions of an ERISA Affiliate). No notice of a "reportable event", within
the meaning of Section 4043 of ERISA for which the 30-day reporting requirement
has not been waived, has been required to be filed for any Pension Plan or by
any ERISA Affiliate within the 12-month period ending on the date hereof or will
be required to be filed in connection with the transactions contemplated by this
Agreement.
(d) Except as set forth on Schedule 5.10, all contributions
required to be made under the terms of any Benefit Plan have been timely made or
have been reflected on the financial statements included in the Company SEC
Reports. Neither any Pension Plan nor any single-employer plan of an ERISA
Affiliate has an "accumulated funding deficiency" (whether or not waived) within
the meaning of Section 412 of the Code or Section 302 of ERISA and no ERISA
Affiliate has an outstanding funding waiver. Neither the Company nor any of its
subsidiaries has provided, or is required to provide, security to any Pension
Plan or to any single-employer plan of an ERISA Affiliate pursuant to Section
401(a)(29) of the Code.
(e) Except as set forth on Schedule 5.10, under each Pension
Plan which is a single-employer plan, as of the last day of the most recent plan
year ended prior to the date hereof, the actuarially determined present value of
all "benefit liabilities", within the meaning of Section 4001(a)(16) of ERISA
(as determined on the basis of the actuarial assumptions contained in the Plan's
most recent actuarial valuation), did not exceed the then current value of the
assets of such Plan, and
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there has been no material change in the financial condition of such Plan since
the last day of the most recent plan year. The withdrawal liability of the
Company and its subsidiaries under each Benefit Plan which is a multiemployer
plan to which the Company, any of its subsidiaries or an ERISA Affiliate has
contributed during the preceding 12 months, determined as if a "complete
withdrawal", within the meaning of Section 4203 of ERISA, had occurred as of the
date hereof, does not exceed $100,000.
(f) Neither the Company nor any of its subsidiaries has any
obligations for retiree health and life benefits under any Benefit Plan, except
as set forth on Schedule 5.10. The Company and its subsidiaries have, at all
times since the effective date of any Benefit Plan providing retiree health and
life benefits, reserved the right to amend or terminate any such Benefit Plan at
any time and have communicated this right to all participants.
(g) Except as indicated on Schedule 5.10, the consummation of
the transactions contemplated by this Agreement will not (x) entitle any
employees of the Company or any of the subsidiaries to severance pay, (y)
accelerate the time of payment or vesting or trigger any payment of compensation
or benefits under, increase the amount payable or trigger any other material
obligation pursuant to, any of the Benefit Plans or (z) result in any breach or
violation of, or a default under, any of the Benefit Plans.
(h) All Benefit Plans covering current or former non-U.S.
Employees comply in all material respects with applicable local law. The Company
and its subsidiaries have no material unfunded liabilities with respect to any
Pension Plan that covers such non-U.S. Employees.
(i) The Company has made available to Parent all collective
bargaining or other labor union contracts to which the Company or any of its
Significant Subsidiaries is a party applicable to persons employed by the
Company or its Significant Subsidiaries as of the date of this Agreement. As of
the date of this Agreement, there is no pending or threatened in writing labor
dispute, strike or work stoppage against the Company or any of its subsidiaries
which may interfere with the respective business activities of the Company or
its subsidiaries, except where such dispute, strike or work stoppage would not
have a Material Adverse Effect.
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5.11 Environmental Laws and Regulations. Except as disclosed in
Schedule 5.11 and except as would not have a Material Adverse Effect: (i) the
Company and its Subsidiaries have complied at all times with all applicable
Environmental Laws; (ii) all properties currently owned or operated by the
Company or any Subsidiary (including soils, groundwater, surface water,
buildings or other structures) are not contaminated with any Hazardous
Substance; (iii) no property formerly owned or operated by the Company or any
Subsidiary has been contaminated with any Hazardous Substance during or prior to
such period of ownership or operation; (iv) neither the Company nor any
Subsidiary is subject to liability for any Hazardous Substance disposal or
contamination on any third party property other than for matters that have been
fully resolved; (v) neither the Company nor any Subsidiary has caused any
release or threat of release of any Hazardous Substance; (vi) neither the
Company nor any Subsidiary has received any notice, demand, letter, claim or
request for information indicating that it may be in violation of or subject to
liability under any Environmental Law other than for matters that have been
fully resolved; (vii) neither the Company nor any Subsidiary is subject to any
order, decree, injunction or other agreement with any Governmental Entity
relating to liability under any Environmental Law; (viii) none of the properties
of the Company or any Subsidiary contain any underground storage tanks,
asbestos-containing material, or polychlorinated biphenyls; (ix) there are no
circumstances or conditions involving the Company or any Subsidiary that could
reasonably be expected to result in any claims, liability, costs or restrictions
on the ownership, use, or transfer of any property pursuant to any Environmental
Law; and (x) the Company has made available to Buyer copies of all material
environmental reports, studies, assessments, sampling data and other
environmental information in its possession relating to the Company or any
Subsidiary or any of their current or former properties or operations. As used
herein, the term "Environmental Law" means any federal, state or local law,
regulation, order, decree, permit, authorization, opinion, common law or agency
requirement relating to: (A) the protection, investigation or restoration of the
environment, health and safety relating to Hazardous Substances, or natural
resources, (B) the handling, use, presence, disposal, release or threatened
release of any Hazardous Substance or (C) noise, odor, wetlands, pollution,
contamination or any injury or threat of injury to persons or property relating
to Hazardous Substances. As used herein, the term "Hazardous Substance" means
any substance that is: (A) listed, classified or regulated pursuant to any
Environmental Law; or (B) any petroleum product or by-product,
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asbestos-containing material, lead-containing paint or plumbing, polychlorinated
biphenyls or radioactive materials or radon.
5.12 Brokers and Finders. Except for the fees and expenses payable
to Credit Suisse First Boston Corporation, which fees and expenses are reflected
in their agreements with the Company, true and complete copies of which have
been furnished to Parent, the Company has not employed any investment banker,
broker, finder, consultant or intermediary in connection with the transactions
contemplated by this Agreement which would be entitled to any investment
banking, brokerage, finder's or similar fee or commission in connection with
this Agreement or the transactions contemplated hereby.
5.13 Opinions of Financial Advisors. The Company has received the
opinion of Credit Suisse First Boston Corporation, dated June 8, 1997, to the
effect that, as of such date, the cash consideration to be received by the
shareholders of the Company pursuant to the Offer and the Merger is fair to such
shareholders from a financial point of view.
5.14 Compliance with Laws; Permits. Except as set forth in the
Company SEC Reports filed prior to the date hereof and as set forth on Schedule
5.14, the businesses of each of the Company and its Subsidiaries have not been,
and are not being, conducted in violation of any federal, state, local or
foreign law, statute, ordinance, rule, regulation, judgment, order, injunction,
decree, arbitration award, agency requirement, license or permit of any
Governmental Entity (collectively, "Laws"), except for violations or possible
violations that, individually or in the aggregate, are not reasonably likely to
have a Material Adverse Effect or prevent or materially burden or materially
impair the ability of the Company to consummate the transactions contemplated by
this Agreement. Except as set forth in the Company SEC Reports filed prior to
the date hereof and as set forth on Schedule 5.14, no investigation or review by
any Governmental Entity with respect to the Company or any of its Subsidiaries
is pending or, to the knowledge of management of the Company and its
Subsidiaries, threatened, nor has any Governmental Entity indicated an intention
to conduct the same. The Company and its Subsidiaries each has all permits,
licenses, franchises, variances, exemptions, orders and other governmental
authorizations, consents and approvals necessary to conduct its business as
presently conducted except those the absence of which are not, individually or
in the aggregate, reasonably likely to have a Material Adverse Effect or prevent
or materially burden or materially impair the ability of the Company to
consummate the
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Merger and the other transactions contemplated by this Agreement.
5.15 Takeover Statutes. The Board of Directors of the Company has
taken all actions required to render the provisions of Section 180.1140 through
Section 180.1144 of the BCL inapplicable to the transactions contemplated by
this Agreement, including the Offer and the Merger, pursuant to the terms of
this Agreement. The Company has elected, pursuant to its Articles of
Incorporation not to be subject to the control share voting restrictions
contained in Section 180.1150 of the BCL are inapplicable to the Company.
5.16 Labor Matters. Except as listed on Schedule 5.16, neither the
Company nor any of its Subsidiaries is a party to or otherwise bound by any
collective bargaining agreement, contract or other agreement or understanding
with a labor union or labor organization, nor is the Company or any of its
Subsidiaries the subject of any material proceeding asserting that the Company
or any of its Subsidiaries has committed an unfair labor practice or is seeking
to compel it to bargain with any labor union or labor organization nor is there
pending or, to the knowledge of management of the Company and its Subsidiaries,
threatened, nor has there been for the past three years, any material labor
strike, dispute, walk-out, work stoppage, slow-down or lockout involving
directly the Company or any of its Subsidiaries. The Company has previously made
available to Parent correct and complete copies of all labor and collective
bargaining agreements to which the Company or any of its Subsidiaries is party
or by which any of them are otherwise bound.
5.17 Insurance. Schedule 5.17 contains a correct and complete list
of all material insurance policies of the Company and its Subsidiaries. All
material fire and casualty, general liability, business interruption, product
liability, and sprinkler and water damage insurance policies maintained by the
Company or any of its Subsidiaries are with reputable insurance carriers,
provide customary coverage for all normal risks incident to the business of the
Company and its Subsidiaries and their respective properties and assets, and are
customary in character and amount at least equivalent to that carried by persons
engaged in similar businesses and subject to the same or similar perils or
hazards, except for any such failures to maintain insurance policies that,
individually or in the aggregate, are not reasonably likely to have a Material
Adverse Effect.
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5.18 Intellectual Property. Except as disclosed in Company SEC
Reports filed prior to the date hereof or as set forth on Schedule 5.18,
(i) The Company and/or each of its Subsidiaries
owns, or is licensed or otherwise possesses valid rights to use all
patents, trademarks, trade names, service marks, copyrights, and any
applications therefor, technology, know-how, computer software programs or
applications, and tangible or intangible proprietary information or
materials that are used in the business of the Company and its
Subsidiaries as currently conducted, except for any such failures to own,
be licensed or possess rights to use that, individually or in the
aggregate, are not reasonably likely to have a Material Adverse Effect,
and to the knowledge of management of the Company and its Subsidiaries all
registrations for patents, trademarks, trade names, service marks and
copyrights owned by the Company and/or its Subsidiaries are valid and
subsisting, except as are not reasonably likely to have a Material Adverse
Effect.
(ii) Except as disclosed in Company SEC Reports
filed prior to the date hereof, as set forth on Schedule 5.18 or as is not
reasonably likely to have a Material Adverse Effect:
(A) the Company is not, nor will it be as a result of the execution
and delivery of this Agreement or the performance of its obligations
hereunder, in violation of any licenses, sublicenses and other
agreements as to which the Company is a party and pursuant to which
the Company is authorized to use any third-party patents,
trademarks, service marks, and copyrights ("Third-Party Intellectual
Property Rights");
(B) no claims against the Company and/or its Subsidiaries with
respect to (I) the patents, registered and material unregistered
trademarks and service marks, registered copyrights, trade names,
and any applications therefor owned by the Company or any its
Subsidiaries (the "Company Intellectual Property Rights"); (II) any
trade secret material to the Company; or (III) Third-Party
Intellectual Property Rights are currently pending or, to the
knowledge of
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management of the Company and its Subsidiaries, are threatened by
any Person;
(C) management of the Company and its Subsidiaries does not know of
any valid grounds for any bona fide claims (I) to the effect that
the manufacture, sale, licensing or use of any product as now used,
sold or licensed or proposed for use, sale or license by the Company
or any of its Subsidiaries, infringes on any copyright, patent,
trademark, service mark or trade secret; (II) against the use by
the Company or any of its Subsidiaries, of any trademarks, trade
names, trade secrets, copyrights, patents, technology, know-how or
computer software programs and applications used in the business of
the Company or any of its Subsidiaries as currently conducted; (III)
challenging the ownership, or validity of any of the Company
Intellectual Property Rights or other trade secret material to the
Company; or (IV) challenging the license or right to use of the
Third-Party Intellectual Rights by the Company or any of its
Subsidiaries; and
(D) to the knowledge of management of the Company and its
Subsidiaries, there is no unauthorized use, infringement or
misappropriation of any of the Company Intellectual Property Rights
material to the Company by any third party, including any employee
or former employee of the Company or any of its Subsidiaries.
5.19 Rights Plan. The Company has amended the Rights Agreement to
provide that Parent shall not be deemed an Acquiring Person (as defined in the
Rights Agreement) and that the Rights will not separate from the Shares as a
result of entering into this Agreement, commencing or consummating the Offer or
consummating the Merger pursuant to the terms of this Agreement.
ARTICLE VI
REPRESENTATIONS AND WARRANTIES OF PARENT
AND NEWCO
Each of Parent and Newco represent and warrant jointly and severally
to the Company that:
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6.1 Corporate Organization and Qualification. Each of Parent and
Newco is a corporation duly organized, validly existing and in good standing
under the laws of its respective jurisdiction of incorporation and is qualified
and in good standing as a foreign corporation in each jurisdiction where the
properties owned, leased or operated, or the business conducted, by it require
such qualification, except where the failure to so qualify or be in such good
standing would not have a Material Adverse Effect.
6.2 Authority Relative to This Agreement. Each of Parent and Newco
has the requisite corporate power and authority to execute and deliver this
Agreement and to consummate the transactions contemplated hereby. This Agreement
and the consummation by Parent and Newco of the transactions contemplated hereby
have been duly and validly authorized by the respective Boards of Directors of
Parent and Newco and by Thyssen Holding Corporation as sole shareholder of
Newco, and no other corporate proceedings on the part of Parent, Newco and
Thyssen Holding Corporation are necessary to authorize this Agreement or to
consummate the transactions contemplated hereby. This Agreement has been duly
and validly executed and delivered by each of Parent and Newco and, assuming
this Agreement constitutes the valid and binding agreement of the Company,
constitutes valid and binding agreements of each of Parent and Newco,
enforceable against each of them in accordance with its terms, except that the
enforcement hereof may be limited by (a) bankruptcy, insolvency, reorganization,
moratorium or other similar laws now or hereafter in effect relating to
creditors' rights generally and (b) general principles of equity (regardless of
whether enforceability is considered in a proceeding at law or in equity).
6.3 Consents and Approvals: No Violation. Neither the execution and
delivery of this Agreement by Parent or Newco nor the consummation by Parent and
Newco of the transactions contemplated hereby will (a) conflict with or result
in any breach of any provision of the Articles of Incorporation or the By-Laws,
respectively, of Parent or Newco; (b) require any consent, approval,
authorization or permit of, or filing with or notification to, any governmental
or regulatory authority, except (i) in connection with the applicable
requirements of the HSR Act, (ii) pursuant to the applicable requirements of the
Exchange Act, (iii) the filing of the Articles of Merger pursuant to the BCL and
appropriate documents with the relevant authorities of other states in which
Parent is authorized to do business, (iv) as may be required by any applicable
state securities or "blue
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sky" laws or state takeover laws, (v) the filing of a Pre-Merger Notification
Form with the German Federal Cartel Office pursuant to the German Act Against
Restraints of Competition (the "AARC") and such other filings, consents,
approvals, orders, registrations, declarations and filings as may be required
under the laws of any foreign country in which Parent or any of its Subsidiaries
conducts any business or owns any assets, (vi) such filings and consents as may
be required under any environmental, health or safety law or regulation
pertaining to any notification, disclosure or required approval triggered by
the Merger or the transactions contemplated by this Agreement or (vii) where the
failure to obtain such consent, approval, authorization or permit, or to make
such filing or notification, would not in the aggregate have a Material Adverse
Effect; (c) except as set forth in Schedule 6.4(c), result in a violation or
breach of, or constitute (with or without due notice or lapse of time or both) a
default (or give rise to any right of termination, cancellation or acceleration
or lien or other charge or encumbrance) under any of the terms, conditions or
provisions of any note, license, agreement or other instrument or obligation to
which Parent or any of its Significant Subsidiaries may be bound, except for
such violations, breaches and defaults (or rights of termination, cancellation
or acceleration or lien or other charge or encumbrance) as to which requisite
waivers or consents have been obtained or which, in the aggregate, would not
have a Material Adverse Effect; or (d) assuming the consents, approvals,
authorizations or permits and filings or notifications referred to in this
Section 6.4 are duly and timely obtained or made, violate any order, writ,
injunction, decree, statute, rule or regulation applicable to Parent or any of
its subsidiaries or to any of their respective assets, except for violations
which would not in the aggregate have a Material Adverse Effect.
6.4 Financing. Either Parent or Newco will have at the time required
sufficient funds available to purchase all of the Shares outstanding on a fully
diluted basis and to pay all fees and expenses related to the transactions
contemplated by this Agreement.
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ARTICLE VII
ADDITIONAL COVENANTS AND AGREEMENTS
7.1 Conduct of Business of the Company.
(a) The Company agrees that during the period from the date of
this Agreement to the Effective Time (unless the other party shall otherwise
agree in writing and except as otherwise contemplated by this Agreement), the
Company will, and will cause each of its Significant Subsidiaries to, conduct
its operations according to its ordinary and usual course of business consistent
with past practice. Without limiting the generality of the foregoing, and except
as otherwise permitted in this Agreement or set forth on Schedule 7.1, prior to
the Effective Time, neither the Company nor any of its Significant Subsidiaries
will, without the prior written consent of Parent:
(i) except for shares to be issued or delivered
pursuant to the Company's Option Plans, issue, deliver, sell, dispose of,
pledge or otherwise encumber, or authorize or propose the issuance, sale,
disposition or pledge or other encumbrance of (A) any additional shares of
capital stock of any class (including the Shares), or any securities or
rights convertible into, exchangeable for, or evidencing the right to
subscribe for any shares of capital stock, or any rights, warrants,
options, calls, commitments or any other agreements of any character to
purchase or acquire any shares of capital stock or any securities or
rights convertible into, exchangeable for, or evidencing the right to
subscribe for, any shares of capital stock, or (B) any other securities in
respect of, in lieu of, or in substitution for, Shares outstanding on the
date hereof;
(ii) except pursuant to the Company's stock-based
employee benefit plans, redeem, purchase or otherwise acquire, or propose
to redeem, purchase or otherwise acquire, any of its outstanding Shares;
(iii) split, combine, subdivide or reclassify any
Shares or declare, set aside for payment or pay any dividend, or make any
other actual, constructive or deemed distribution in respect of any Shares
or otherwise make any payments to shareholders in their capacity as such,
other than the declaration
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and payment of regular quarterly cash dividends not in excess of $0.03 per
Share for any quarterly period and except for dividends by a wholly owned
subsidiary of the Company;
(iv) adopt a plan of complete or partial
liquidation, dissolution, merger, consolidation, restructuring,
recapitalization or other reorganization of the Company or any of its
subsidiaries (other than the Merger);
(v) adopt any amendments to its Articles of
Incorporation or By-Laws or alter through merger, liquidation,
reorganization, restructuring or in any other fashion the corporate
structure or ownership of any subsidiary of the Company;
(vi) make any material acquisition, by means of
merger, consolidation or otherwise, or material disposition (other than
disposition of assets in the ordinary course of business, consistent with
past practice), of assets or securities;
(vii) other than in the ordinary course of
business consistent with past practice, incur any indebtedness for
borrowed money or guarantee any such indebtedness or make any loans,
advances or capital contributions to, or investments in, any other person,
other than to the Company or any wholly owned subsidiary of the Company;
(viii) grant any material increases in the
compensation of any of its directors, officers or key employees, except in
the ordinary course of business and in accordance with past practice;
(ix) pay or agree to pay any pension, retirement
allowance or other employee benefit not required or contemplated by any of
the existing benefit, severance, termination, pension or employment plans,
agreements or arrangements as in effect on the date hereof to any director
or officer of the Company, whether past or present;
(x) enter into any new or materially amend any
existing employment or severance or
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termination agreement with any such director or officer;
(xi) except in the ordinary course of business
consistent with past practice or as may be required to comply with
applicable law, become obligated under any new pension plan, welfare plan,
multiemployer plan, employee benefit plan, severance plan, benefit
arrangement, or similar plan or arrangement, which was not in existence on
the date hereof, or amend any such plan or arrangement in existence on
the date hereof if such amendment would have the effect of materially
enhancing any benefits thereunder;
(xii) authorize or make any individual capital
expenditure in excess of $1,000,000 or authorize or make capital
expenditures in excess of $15,000,000 in the aggregate;
(xiii) settle or compromise any material claims or
litigation or, except in the ordinary and usual course of business,
modify, amend or terminate any of its material Contracts or waive, release
or assign any material rights or claims;
(xiv) make any material change, other than in the
ordinary course of business and consistent with past practice or as
required by applicable law, regulation or change in generally accepted
accounting principles, in accounting policies or procedures applied by the
Company (including tax accounting policies and procedures);
(xv) except as otherwise required by applicable
law or regulation, make any tax election or permit any insurance policy
naming it as a beneficiary or a loss payable payee to be canceled or
terminated, except in the ordinary course of business;
(xvi) take any action to amend or alter the Rights
Agreement in any manner adverse to Parent's, Newco's or the Company's
ability to commence or consummate the transactions contemplated by this
Agreement pursuant to the terms hereof; or
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(xvii) authorize, or enter into any contract,
agreement, commitment or arrangement to do any of the foregoing.
7.2 Acquisition Proposals. The Company agrees that neither it nor
any of its Subsidiaries nor any of the officers and directors of it or its
Subsidiaries shall, and that it shall direct and use its best efforts to cause
its and its Subsidiaries' employees, agents and representatives (including any
investment banker, attorney or accountant retained by it or any of its
Subsidiaries) not to, directly or indirectly, initiate, solicit, encourage or
otherwise facilitate any inquiries or the making of any proposal or offer with
respect to a merger, reorganization, share exchange, consolidation or similar
transaction involving, or any purchase of all or any significant portion of the
assets or equity securities of, it or any of its Subsidiaries (any such proposal
or offer being hereinafter referred to as an "Acquisition Proposal"). The
Company further agrees that neither it nor any of its Subsidiaries nor any of
the officers and directors of it or its Subsidiaries shall, and that it shall
direct and use its best efforts to cause its and its Subsidiaries' employees,
agents and representatives (including any investment banker, attorney or
accountant retained by it or any of its Subsidiaries) not to, directly or
indirectly, engage in any negotiations concerning, or provide any confidential
information or data to, or have any discussions with, any Person relating to an
Acquisition Proposal, or otherwise facilitate any effort or attempt to make or
implement an Acquisition Proposal; provided, however, that nothing contained in
this Agreement shall prevent the Company or its Board of Directors from (A)
complying with Rules 14d-9 and 14e-2 promulgated under the Exchange Act with
regard to an Acquisition Proposal; (B) providing information in response to a
request therefor by a Person who has made an unsolicited bona fide written
Acquisition Proposal if the Board of Directors takes reasonable steps to protect
the confidentiality of such information; (C) engaging in any negotiations or
discussions with any Person who has made an unsolicited bona fide written
Acquisition Proposal; or (D) recommending such an Acquisition Proposal to the
shareholders of the Company, if (i) in each such case referred to in clause (B),
(C) or (D) above, the Company reasonably determines in good faith based upon the
advice of outside legal counsel to the Company that such action is necessary in
order for the Board of Directors of the Company to comply with its fiduciary
duties under applicable law, and (ii) in each case referred to in clause (C) or
(D) above, the Board of Directors of the Company determines in good faith (after
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consultation with its financial advisor) that such Acquisition Proposal would,
if consummated, result in a transaction more favorable to the Company's
shareholders from a financial point of view than the transaction contemplated by
this Agreement (any such more favorable Acquisition Proposal being referred to
in this Agreement as a "Superior Proposal"). The Company agrees that it will
immediately cease and cause to be terminated any existing activities,
discussions or negotiations with any parties conducted heretofore with respect
to any of the foregoing. The Company agrees that it will take the necessary
steps to promptly inform the individuals or entities referred to in the first
sentence hereof of the obligations undertaken in this Section 7.2. The Company
agrees that it will notify Parent immediately if any such inquiries, proposals
or offers are received by, any such information is requested from, or any such
discussions or negotiations are sought to be initiated or continued with, any of
its representatives indicating, in connection with such notice, the name of such
Person and the material terms and conditions of any proposals or offers. The
Company also agrees that it will promptly request each Person that has
heretofore executed a confidentiality agreement in connection with its
consideration of acquiring it or any of its Subsidiaries to return all
confidential information heretofore furnished to such Person by or on behalf of
it or any of its Subsidiaries.
7.3 Approvals and Consents; Cooperation. Subject to the other
provisions of this Agreement, the parties hereto shall use their respective best
efforts, and cooperate with each other, to obtain as promptly as practicable all
governmental and third party authorizations, approvals, consents or waivers,
including, without limitation, pursuant to the HSR Act and the AARC, required in
order to consummate the transactions contemplated by this Agreement, including,
without limitation, the Offer and the Merger.
7.4 Further Assurances. Subject to the other provisions of this
Agreement, each of the parties hereto agrees to use its best efforts to take, or
cause to be taken, all action, and to do, or cause to be done, all things
necessary, proper or advisable under applicable laws and regulations to
consummate and make effective the transactions contemplated by this Agreement,
including, without limitation, the Offer and the Merger, which efforts shall
include, without limitation, Parent and Newco using their best efforts to
prevent any preliminary or permanent injunction or other order by a court of
competent jurisdiction or governmental entity relating to consummating the
transactions
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contemplated by this Agreement, including, without limitation, under the
antitrust laws, and, if issued, to appeal any such injunction or order through
the appellate court or body for the relevant jurisdiction; provided, however,
that nothing in this Agreement shall require, or be construed to require, Parent
to proffer to, or agree to, sell or hold separate and agree to sell, before or
after the Effective Time, any assets, businesses, or interest in any assets or
businesses of Parent, the Company or any of their respective affiliates (or to
consent to any sale, or agreement to sell, by the Company of any of its assets
or businesses) or to agree to any material changes or restriction in the
operations of any such assets or businesses. If at any time after the Effective
Time any further action is necessary or desirable to carry out the purposes of
this Agreement, the parties hereto shall take or cause to be taken all such
necessary action, including, without limitation, the execution and delivery of
such further instruments and documents as may be reasonably requested by the
other party for such purposes or otherwise to consummate and make effective the
transactions contemplated hereby.
7.5 Access to Information. Upon reasonable notice, the Company shall
(and shall cause each of its subsidiaries to) afford to officers, employees,
counsel, accountants and other authorized representatives of Parent
("Representatives"), in order to evaluate the transactions contemplated by this
Agreement, reasonable access, during normal business hours throughout the period
prior to the Effective Time, to its properties, books and records and, during
such period, shall (and shall cause each of its subsidiaries to) furnish
promptly to such Representatives all information concerning its business,
properties and personnel as may reasonably be requested. Parent agrees that it
will not, and will cause its Representatives not to, use any information
obtained pursuant to this Section 7.5 for any purpose unrelated to the
consummation of the transactions contemplated by this Agreement. The
Confidentiality Agreement, dated April 30, 1997 (the "Confidentiality
Agreement"), by and between the Company and Parent shall apply with respect to
information furnished by the Company, its subsidiaries and the Company's
officers, employees, counsel, accountants and other authorized representatives
hereunder.
7.6 Publicity. The parties will consult with each other and will
mutually agree upon any press releases or public announcements pertaining to the
Offer or the Merger and shall not issue any such press releases or make any such
public announcements prior to such consultation and agreement, except as
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may be required by applicable law or by obligations pursuant to any listing
agreement with any national securities exchange, in which case the party
proposing to issue such press release or make such public announcement shall use
its reasonable efforts to consult in good faith with the other party before
issuing any such press releases or making any such public announcements.
7.7 Indemnification of Directors and Officers.
(a) The Articles of Incorporation and By-Laws of the Surviving
Corporation shall contain the provisions with respect to indemnification set
forth in the Articles of Incorporation and By-Laws of the Company on the date of
this Agreement, which provisions shall not be amended, repealed or otherwise
modified for a period of six years after the Effective Time in any manner that
would adversely affect the rights thereunder of individuals who at any time
prior to the Effective Time were directors or officers of the Company in respect
of actions or omissions occurring at or prior to the Effective Time (including,
without limitation, the transactions contemplated by this Agreement), unless
such modification is required by law; provided, that in the event any claim or
claims are asserted or made within such six-year period, all rights to
indemnification in respect of any such claim or claims shall continue until
disposition of any and all such claims.
(b) Parent shall cause to be maintained in effect for the
Indemnified Parties (as defined below) for not less than five years the current
policies of directors, and officers, liability insurance and fiduciary liability
insurance maintained by the Company and the Company's subsidiaries with respect
to matters occurring at or prior to the Effective Time (including, without
limitation, the transactions contemplated by this Agreement); provided, that
Parent may substitute therefor policies of substantially the same coverage
containing terms and conditions which are no less advantageous to the Company's
present or former directors or officers or other employees covered by such
insurance policies prior to the Effective Time (the "Indemnified Parties").
Notwithstanding the foregoing, in no case shall Parent or the Surviving
Corporation be required to pay an annual premium for such insurance greater than
125% of the last annual premium paid prior to the date hereof. Should payment of
the maximum amount of premium provided for in the previous sentence not allow
the purchase of an amount of such insurance equal to the amount provided under
the current policies, Parent shall purchase the maximum amount of insurance
available for 125% of the last annual premium.
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(c) This Section 7.7 is intended to benefit the Indemnified
Parties and shall be binding on all successors and assigns of Parent, Newco, the
Company and the Surviving Corporation.
7.8 Employees
(a) Except as set forth on Schedule 7.8(a), for a period of
one year following the Effective Time, Parent agrees to provide employee benefit
plans and programs for the benefit of employees of the Company and its
Subsidiaries (excluding plans or programs which provide for issuance of Shares
or options on Shares) that are in the aggregate no less favorable to such
employees than the Company Plans. All service credited to each employee by the
Company through the Effective Time shall be recognized by Parent for purposes of
eligibility and vesting under any employee benefit plan provided by Parent for
the benefit of the employees.
(b) Parent shall cause the Surviving Corporation to honor
(without modification) and assume the written employment agreements, severance
agreements and other agreements listed on Schedule 7.8(b), all as in effect on
the date of this Agreement.
(c) Parent shall maintain in effect the Company Severance Plan
for a period of two years immediately following the Effective Time and the
Company Severance Plan shall not be terminated or adversely amended during such
two-year period.
(d) Parent shall maintain in effect the Company Management
Incentive Compensation Plan and the Company Profit Improvement Plan until
December 31, 1997 and such plans shall not be terminated or adversely amended
until after such date.
(e) Parent shall maintain in effect the Giddings & Lewis
Foundation, Inc. for a period of two years immediately following the Effective
Time and, during such period, shall operate the Giddings & Lewis Foundation,
Inc. on substantially the same basis (which shall include selection of
beneficiaries based on the same geographical and other attributes) as the
Giddings & Lewis Foundation, Inc. was operated during the twelve-month period
immediately preceding the Effective Time; provided, however that neither Parent
nor any of its subsidiaries nor the Company or any of its subsidiaries shall be
required to expend any funds in connection with the operation of the Giddings &
Lewis Foundation, Inc.
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7.9 Notification of Certain Matters. The Company shall give prompt
notice to Parent of: (a) any notice of, or other communication relating to, a
default or event that, with notice or lapse of time or both, would become a
default, received by the Company or any of its subsidiaries subsequent to the
date of this Agreement and prior to the Effective Time, under any Contract to
which the Company or any of its subsidiaries is a party or is subject, which
default is reasonably likely to have a Material Adverse Effect; and (b) any
material adverse change in the financial condition, properties, business or
results of operations of the Company and its subsidiaries taken as a whole or
the occurrence of any event which is reasonably likely to result in any such
change. Each of the Company and Parent shall give prompt notice to the other
party of any notice or other communication from any third party alleging that
the consent of such third party is or may be required in connection with the
transactions contemplated by this Agreement.
7.10 Company Board.
(a) Promptly (but in any event within two business days) upon
the purchase by Parent of a majority of the outstanding Shares pursuant to the
Offer, either (a) a majority of the members of the Board of Directors of the
Company shall resign and the remaining members of the Board of Directors of the
Company shall fill all of the Board positions so vacated with persons designated
by Parent or (b) the size of the Board of Directors of the Company shall be
expanded and the vacant seats filled with persons designated by Parent so that
Parent's designees shall constitute a majority of the members of the Board of
Directors of the Company. In either case, at all times thereafter through the
Effective Time a majority of the members of the Board of Directors of the
Company shall be persons designated by Parent.
(b) The Company's obligation to appoint designees to the Board
of Directors of the Company shall be subject to Section 14(f) of the Exchange
Act and Rule 14e-1 promulgated thereunder. The Company shall promptly take all
actions required pursuant to such Section and Rule in order to fulfill its
obligations under this Section 7.10 and shall include in the Schedule 14D-9 such
information with respect to the Company and its officers and directors as is
required under Section 14(f) and Rule 14e-1 to fulfill such obligations. Parent
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or Newco shall supply to the Company and be solely responsible for any
information with respect to either of them and their nominees, officers,
directors and affiliates required by such Section 14(f) and Rule 14e-1.
(c) Following the election of designees of Newco pursuant to
this Section 7.10, prior to the Effective Time, any amendment of this Agreement
or the Articles of Incorporation or By-laws of the Company, any termination of
this Agreement by the Company, any extension by the Company of the time for the
performance of any of the obligations or other acts of Parent or Newco or waiver
of any of the Company's rights hereunder shall require the concurrence of a
majority of the directors of the Company then in office who are directors as of
the date hereof or persons designated by such directors and who were neither
designated by Newco nor employees of the Company ("Continuing Directors"). Prior
to the Effective Time, the Company and Newco shall use all reasonable efforts to
ensure that the Company's Board of Directors at all times includes at least
three Continuing Directors.
ARTICLE VIII
CONDITIONS TO CONSUMMATION OF THE MERGER
8.1 Conditions to Each Party's Obligations to Effect the Merger. The
respective obligations of each party to effect the Merger are subject to the
satisfaction at or prior to the Effective Time of the following conditions:
(a) Shareholder Approval. To the extent required by applicable
law, this Agreement shall have been duly approved by the shareholders of the
Company in accordance with applicable law and the Articles of Incorporation of
the Company; provided that Parent and Newco shall vote all of their Shares in
favor of the Merger.
(b) Injunction. There shall not be in effect any statute,
rule, regulation, executive order, decree, ruling or injunction or other order
of a court or governmental or regulatory agency of competent jurisdiction
directing that the transactions contemplated herein not be consummated;
provided, however, that prior to invoking this condition each party shall use
its best efforts to have any such decree, ruling, injunction or order vacated.
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(c) Governmental Filings and Consents. All governmental
consents, orders and approvals legally required for the consummation of the
Merger and the transactions contemplated hereby shall have been obtained and be
in effect at the Effective Time, except where the failure to obtain any such
consent would not reasonably be expected to have a Material Adverse Effect on
Parent and its subsidiaries, considered as whole (assuming the Merger had taken
place), and the waiting periods under the HSR Act shall have expired or been
terminated.
(d) The Offer. Newco shall have purchased Shares pursuant to
the Offer.
ARTICLE IX
TERMINATION; AMENDMENT; WAIVER
9.1 Termination by Mutual Consent. This Agreement may be terminated
and the Offer and the Merger may be abandoned at any time prior to the Effective
Time, by the mutual written consent of Parent and the Company.
9.2 Termination by Either Parent or the Company. This Agreement may
be terminated and the Offer and the Merger may be abandoned by Parent or the
Company if (i) any governmental body or regulatory authority of the United
States of America or the Federal Republic of Germany shall have commenced legal
action or provided formal notice to Parent, Newco or the Company that it is
about to commence legal action, with respect to the transactions contemplated by
this Agreement, or (ii) Newco shall not have purchased Shares pursuant to the
Offer on or prior to December 31, 1997; provided, that the right to terminate
this Agreement pursuant to this Section 9.2 shall not be available to any party
whose failure to fulfill any of its obligations under this Agreement results in
such failure to purchase.
9.3 Termination by the Company. This Agreement may be terminated and
the Offer and the Merger may be abandoned at any time prior to the Effective
Time, by action of the Board of Directors of the Company:
(a) if (i) the Company, based on the advice of outside legal
counsel to the Company that such action is necessary in order for the Board of
Directors of the Company to comply with its fiduciary duties under applicable
law, subject to complying with the terms of this Agreement, enters into a
binding
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written agreement concerning a transaction that constitutes a Superior Proposal
and the Company notifies Parent in writing that it intends to enter into such an
agreement, attaching the most current version of such agreement to such notice,
(ii) Parent does not make, within two business days of receipt of the Company's
written notification of its intention to enter into a binding agreement for a
Superior Proposal, an offer to enter into an amendment to this Agreement such
that the Board of Directors of the Company determines, in good faith after
consultation with its financial advisors, that this Agreement as so amended is
at least as favorable, from a financial point of view, to the shareholders of
the Company as the Superior Proposal and (iii) the Company prior to such
termination pays to Parent in immediately available funds any fees required to
be paid pursuant to Section 9.5. The Company agrees (A) that it will not enter
into a binding agreement referred to in clause (i) above until at least the
third business day after it has provided the notice to Parent required thereby
and (B) to notify Parent promptly if its intention to enter into a written
agreement referred to in its notification shall change at any time after giving
such notification.
(b) if (i) Newco shall have (x) failed to commence the Offer
within five business days following the date of the initial public announcement
of the Offer or (y) terminated the Offer without purchasing Shares pursuant to
the Offer, or (ii) there has been a material breach by Parent or Newco of any
representation, warranty, covenant or agreement contained in this Agreement that
is not curable or, if curable, is not cured within 30 calendar days after
written notice of such breach is given by the Company to the party committing
such breach.
9.4 Termination by Parent. This Agreement may be terminated and the
Offer and Merger may be abandoned at any time prior to the Effective Time by
action of the Board of Directors of Parent if (i) the Board of Directors of the
Company shall have withdrawn or adversely modified its approval or
recommendation of this Agreement or failed to reconfirm its recommendation of
this Agreement within five business days after a written request by Parent to do
so, (ii) there has been a breach by the Company of any representation, warranty,
covenant or agreement contained in this Agreement that is qualified as to
materiality or there has been a material breach of any other representation,
warranty, covenant or agreement contained in this Agreement, in any case that is
not curable or, if curable, is not cured within 30 calendar days after written
notice of such breach is given by Parent to the party committing such breach, or
(iii) on a
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scheduled expiration date all conditions to Newco's obligation to accept for
payment and pay for Shares pursuant to the Offer shall have been satisfied or
waived other than the Minimum Condition and Newco terminates the Offer without
purchasing Shares pursuant to the Offer, provided that the satisfaction or
waiver of all other conditions shall have been publicly disclosed at least five
business days before termination of the Offer, or (iv) Newco shall have
otherwise terminated the Offer in accordance with the terms of this Agreement,
including Annex A, without purchasing shares pursuant to the Offer.
9.5 Effect of Termination and Abandonment. (a) In the event of
termination of this Agreement and the abandonment of the Merger pursuant to this
Article IX, this Agreement (other than, with respect to the parties hereto, the
obligations pursuant to this Section 9.5 and Sections 10.1 and 10.2) shall
become void and of no effect with no liability on the part of any party hereto
(or of any of its directors, officers, employees, agents, legal and financial
advisors or other representatives); provided, however, except as otherwise
provided herein, no such termination shall relieve any party hereto of any
liability or damages resulting from any wilful breach of this Agreement.
(b) In the event that (x) this Agreement is terminated by the
Company pursuant to Section 9.3(a) or (y) this Agreement is terminated by Parent
pursuant to Section 9.4(i) then the Company shall promptly, but in no event
later than two days after the date of such termination or event, pay Parent a
termination fee of $20,000,000 (the "Termination Fee") and shall promptly, but
in no event later than two days after being furnished documentation in respect
thereto by Parent, pay all of the charges and expenses, including those of the
Exchange Agent, actually incurred by Parent or Newco in connection with this
Agreement and the transactions contemplated by this Agreement up to a maximum
amount of $3,000,000 (the "Expense Reimbursement"), in each case payable by wire
transfer of same day funds. If (A) this Agreement is terminated by the Parent
pursuant to Section 9.4(iii) or by the Company pursuant to Section 9.3(b)(i)(y)
when the Offer is terminated by Parent under the circumstances contemplated by
Section 9.4(iii), and (B) within one year after such termination either (X) the
Company enters into an agreement to merge with another company (other than a
merger pursuant to which the shareholders of the Company will acquire more than
50% of the voting securities of such surviving corporation) or enters into an
agreement pursuant to which more than 50% of the Shares are acquired by another
person or pursuant to which new voting securities are issued to another person
or to
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the shareholders of another company which will aggregate more than 50% of the
outstanding voting securities of the Company after such issuance, or (Y) another
Person acquires more than 50% of the Shares, then the Company shall promptly,
but in no event later than two days after the date of any of the events in (X)
or (Y), pay Parent the Termination Fee and the Expense Reimbursement. The
Company acknowledges that the agreements contained in this Section 9.5(b) are an
integral part of the transactions contemplated by this Agreement, and that,
without these agreements, Parent and Newco would not enter into this Agreement;
accordingly, if the Company fails to promptly pay the amount due pursuant to
this Section 9.5(b), and, in order to obtain such payment, Parent or Newco
commences a suit which results in a judgment against the Company for the fee set
forth in this paragraph (b), the Company shall pay to Parent or Newco its costs
and expenses (including attorneys' fees) in connection with such suit, together
with interest on the amount of the fee at the prime rate of Citibank, N.A. in
effect on the date such payment was required to be made.
9.6 Extension; Waiver. Subject to the applicable provisions of the
BCL and the provisions of this Agreement, including Section 7.10, at any time
prior to the Effective Time, each of Parent, Newco and the Company may (i)
extend the time for the performance of any of the obligations or other acts of
the other party, (ii) waive any inaccuracies in the representations and
warranties of the other party contained herein or in any document, certificate
or writing delivered pursuant hereto or (iii) waive compliance by the other
party with any of the agreements or conditions contained herein. Any agreement
on the part of either party hereto to any such extension or waiver shall be
valid only if set forth in any instrument in writing signed on behalf of such
party. The failure of either party hereto to assert any of its rights hereunder
shall not constitute a waiver of such rights.
ARTICLE X
MISCELLANEOUS AND GENERAL
10.1 Payment of Expenses. Except as provided in Section 9.5(b),
whether or not the Offer and the Merger shall be consummated, each party hereto
shall pay its own expenses incident to preparing for, entering into and carrying
out this Agreement and the consummation of the transactions contemplated hereby.
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10.2 Survival of Representations and Warranties; Survival of
Confidentiality. The representations and warranties made herein shall not
survive beyond the earlier of (i) termination of this Agreement or (ii) the
Effective Time, in the case of the representations and warranties of Parent or
Newco or the purchase of Shares by Newco pursuant to the Offer, in the case of
the representations and warranties of the Company. This Section 10.2 shall not
limit any covenant or agreement of the parties hereto which by its terms
contemplates performance after the Effective Time or the Purchase of Shares by
Newco pursuant to the Offer. The Confidentiality Agreement shall survive any
termination of this Agreement and the provisions of such Confidentiality
Agreement shall apply to all information and material delivered by any party
hereunder.
10.3 Modification or Amendment. Subject to the applicable provisions
of the BCL and the provisions of this Agreement, including Section 7.10, at any
time prior to the Effective Time, the parties hereto may modify or amend this
Agreement by written agreement executed and delivered by duly authorized
officers of the respective parties.
10.4 Waiver of Conditions. Subject to the applicable provisions of
the BCL and the provisions of this Agreement, including Section 7.10, the
conditions to each of the parties' obligations to consummate the Merger are for
the sole benefit of such party and may be waived by such party in whole or in
part.
10.5 Counterparts. For the convenience of the parties hereto, this
Agreement may be executed in any number of counterparts, each such counterpart
being deemed to be an original instrument, and all such counterparts shall
together constitute the same agreement.
10.6 Governing Law. (a) This Agreement shall be governed by and
construed in accordance with the laws of the State of Wisconsin, without giving
effect to the principles of conflicts of law thereof.
(b) Each of the parties hereto (i) consents to submit itself
to the personal jurisdiction of any Federal court located in the State of
Delaware or any Delaware state court in the event any dispute arises out of
this Agreement or any of the transactions contemplated hereby, (ii) agrees that
it will not attempt to deny or defeat such personal jurisdiction by motion or
other request for leave from any such court and (iii) agrees that
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it will not bring any action relating to this Agreement or any of the
transactions contemplated hereby in any court other than a Federal or state
court sitting in the State of Delaware.
(c) EACH PARTY ACKNOWLEDGES AND AGREES THAT ANY CONTROVERSY
WHICH MAY ARISE UNDER THIS AGREEMENT IS LIKELY TO INVOLVE COMPLICATED AND
DIFFICULT ISSUES, AND THEREFORE EACH SUCH PARTY HEREBY IRREVOCABLY AND
UNCONDITIONALLY WAIVES ANY RIGHT SUCH PARTY MAY HAVE TO A TRIAL BY JURY IN
RESPECT OF ANY LITIGATION DIRECTLY OR INDIRECTLY ARISING OUT OF OR RELATING TO
THIS AGREEMENT, OR THE TRANSACTIONS CONTEMPLATED BY THIS AGREEMENT. EACH PARTY
CERTIFIES AND ACKNOWLEDGES THAT (i) NO REPRESENTATIVE, AGENT OR ATTORNEY OF ANY
OTHER PARTY HAS REPRESENTED, EXPRESSLY OR OTHERWISE, THAT SUCH OTHER PARTY WOULD
NOT, IN THE EVENT OF LITIGATION, SEEK TO ENFORCE THE FOREGOING WAIVER, (ii) EACH
PARTY UNDERSTANDS AND HAS CONSIDERED THE IMPLICATIONS OF THIS WAIVER, (iii) EACH
PARTY MAKES THIS WAIVER VOLUNTARILY, AND (iv) EACH PARTY HAS BEEN INDUCED TO
ENTER INTO THIS AGREEMENT BY, AMONG OTHER THINGS, THE MUTUAL WAIVERS AND
CERTIFICATIONS IN THIS SECTION 10.6.
10.7 Notices. Any notice, request, instruction or other document to
be given hereunder by any party to the other parties shall be in writing and
delivered personally or sent by overnight courier with confirmation of next day
delivery or by facsimile transmission (with a confirming copy sent by overnight
courier), as follows:
(a) If to the Company, to
Giddings & Lewis, Inc.
142 Doty Street
Fond du Lac, Wisconsin 54936-0590
Attn: Marvin L. Isles
(414) 921-9400 (telephone)
(414) 929-4334 (telecopier)
with a copy to:
Skadden, Arps, Slate, Meagher & Flom
(Illinois)
333 West Wacker Drive
Chicago, Illinois 60606
Attn: Charles W. Mulaney, Jr.
(312) 407-0700 (telephone)
(312) 407-0411 (telecopier)
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(b) If to Parent, to
Thyssen Aktiengesellschaft
August-Thyssen-StraBe 1
Dusseldorf
Postanschrift: Postfach 10 10 10,
D-40001 Dusseldorf
Attn: Axel Kirsch
011 49 211 824 8004 (telephone)
011 49 211 824 8376 (telecopier)
with a copy to:
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Attn: Neil T. Anderson
(212) 558-4000 (telephone)
(312) 558-3588 (telecopier)
(c) If to Newco, to
TAQU, Inc.
c/o The Budd Company
3155 West Big Beaver Road
Troy, Michigan 48084
Attn: Nancy L. Hutcheson
(810) 643-3511 (telephone)
(810) 643-3636 (telecopier)
with a copy to:
Sullivan & Cromwell
125 Broad Street
New York, New York 10004
Attn: Neil T. Anderson
(212) 558-4000 (telephone)
(312) 558-3588 (telecopier)
or to such other persons or addresses as may be designated in writing by the
party to receive such notice.
10.8 Entire Agreement; Assignment. This Agreement and the
Confidentiality Agreement (a) constitute the entire agreement among the parties
with respect to the subject matter hereof and supersede all other prior
agreements and understandings, both
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written and oral, among the parties or any of them with respect to the subject
matter hereof, and (b) shall not be assigned by operation of law or otherwise.
10.9 Parties in Interest. This Agreement shall be binding upon and
inure solely to the benefit of each party hereto and their respective successors
and assigns. Nothing in this Agreement, express or implied, other than the right
to receive the consideration payable in the Merger pursuant to Article IV hereof
is intended to or shall confer upon any other person any rights, benefits or
remedies of any nature whatsoever under or by reason of this Agreement;
provided, however, that the provisions of Section 7.7 shall inure to the benefit
of and be enforceable by the Indemnified Parties and the provisions of Section
7.8(b) shall inure to the benefit of and be enforceable by the officers and
directors of the Company.
10.10 Certain Definitions. As used herein:
(a) "Significant Subsidiary" shall have the meaning ascribed
to it under Rule 1-02 of Regulation S-X of the SEC.
(b) "Subsidiary" shall mean, when used with reference to any
entity, any corporation a majority of the outstanding voting securities of which
are owned directly or indirectly by such entity.
(c) "Material Adverse Effect" shall mean any adverse change or
changes in the financial condition, properties, business or results of
operations of the Company or any of its subsidiaries or Parent or any of its
subsidiaries, as the case may be, which individually or in the aggregate is or
are material to the Company and its subsidiaries, taken as a whole, or Parent
and its subsidiaries, taken as a whole, as the case may be, other than any
change or effect arising out of general economic conditions.
10.11 Obligation of Parent. Whenever this Agreement requires Newco
to take any action, such requirement shall be deemed to include an undertaking
on the part of Parent to cause Newco to take such action and a guarantee of the
performance thereof.
10.12 Validity. The invalidity or unenforceability of any provision
of this Agreement shall not affect the validity or
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enforceability of any other provisions of this Agreement, each of which shall
remain in full force and effect.
10.13 Captions. The Article, Section and paragraph captions herein
are for convenience of reference only, do not constitute part of this Agreement
and shall not be deemed to limit or otherwise affect any of the provisions
hereof.
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IN WITNESS WHEREOF, the parties hereto have caused this Agreement to
be executed by their respective duly authorized officers as of the date first
above written.
THYSSEN AKTIENGESELLSCHAFT
By: /s/ Dr. Eckhard Rohkamm
--------------------------------------
Name: Dr. Eckhard Rohkamm
Title: Member of The Executive Board
By: /s/ Dr. Eckart Blockfeld
--------------------------------------
Name: Dr. Eckart Blockfeld
Title: Authorized Officer
GIDDINGS & LEWIS, INC.
By: /s/ Marvin L. Isles
--------------------------------------
Name: Marvin L. Isles
Title: Chairman and Chief Executive
Officer
TAQU, INC.
By: /s/ Axel Kirsch
--------------------------------------
Name: Axel Kirsch
Title: President
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Annex A
Certain Conditions of the Offer. Notwithstanding any other provision
of the Offer and provided that Newco shall not be obligated to accept for
payment any Shares until (i) expiration of all applicable waiting periods under
the HSR Act and the AARC and (ii) the Minimum Condition shall have been
satisfied, Newco shall not be required to accept for payment or pay for, or may
delay the acceptance for payment of or payment for, any Shares tendered pursuant
to the Offer, or may, subject to the terms of the Agreement, terminate or amend
the Offer if on or after June 11, 1997, and at or before the time of payment for
any of such Shares, any of the following events shall occur (or become known to
Parent) and remain in effect:
(a) there shall have occurred and be continuing as of the then
scheduled expiration date of the Offer (i) any general suspension of, or
limitation on prices for, trading in securities on the New York Stock
Exchange, the Nasdaq National Market or stock exchanges in the Federal
Republic of Germany, (ii) a declaration of a banking moratorium or any
suspension of payments in respect of banks in the United States or the
Federal Republic of Germany, (iii) a commencement or escalation of a war,
armed hostilities or other international or national calamity directly
involving the United States or the Federal Republic of Germany, (iv) any
material limitation (whether or not mandatory) by any governmental or
regulatory authority, agency or commission, domestic or foreign
("Governmental Entity"), on the extension of credit by banks or other
lending institutions in the United States or the Federal Republic of
Germany, (v) or in the case of any of the foregoing existing at the time
of the commencement of the Offer, a material acceleration or worsening
thereof;
(b) (i) the Company shall have breached or failed to perform in any
material respect any of its obligations, covenants or agreements under the
Agreement, (ii) any representation or warranty of the Company set forth in
the Agreement which is qualified by materiality shall not have been true
and correct as of the date of the Agreement and as of the then scheduled
expiration date of the Offer as though made on and as of the then
scheduled expiration date of the Offer or (iii) any
<PAGE>
representation or warranty of the Company set forth in the Agreement which
is not qualified by materiality shall not have been true and correct in
all material respects as of the date of this Agreement and as of the then
scheduled expiration date of the Offer as though made on and as of the
then scheduled expiration date of the Offer, except in the case of clauses
(ii) and (iii) of this paragraph (b) for representations and warranties
which by their terms speak only as of another date, which representations
and warranties, if qualified by materiality, shall not have been true and
correct as of such date and, if not qualified, shall not have been true
and correct in all material respects as of such other date;
(c) any court or Governmental Entity shall have enacted, issued,
promulgated, enforced or entered any statute, rule, regulation, executive
order, decree, injunction or other order which is in effect and which (i)
restricts (other than restrictions which in the aggregate do not have a
Material Adverse Effect on Parent, Newco or the Company or which do not
materially restrict the ability of Parent and Newco to consummate the
Offer and the Merger as originally contemplated by Parent and Newco),
prevents or prohibits consummation of the Offer or the Merger, (ii)
prohibits or limits (other than limits which in the aggregate do not have
a Material Adverse Effect on Parent, Newco or the Company or which do not
materially limit the ability of Parent to own and operate all of the
business and assets of Parent and the Company after the consummation of
the transactions contemplated by the Offer and the Agreement) the
ownership or operation by the Company, Parent or any of their subsidiaries
of all or any material portion of the business or assets of the Company
and its subsidiaries taken as a whole, or as a result of the Offer or the
Merger compels the Company, Parent or any of their subsidiaries to dispose
of or hold separate all or any material portion of their respective
business or assets, (iii) imposes limitations (other than limits which in
the aggregate do not have a Material Adverse Effect on Parent, Newco or
the Company or which do not materially limit the ability of Parent to own
and operate all of the business and assets of Parent and the Company after
the consummation of the transactions contemplated by the Offer and the
Agreement) on the ability of Parent or
A-2
<PAGE>
any subsidiary of Parent to exercise effectively full rights of ownership
of any Shares, including, without limitation, the right to vote any Shares
acquired by Newco pursuant to the Offer or otherwise on all matters
properly presented to the Company's shareholders including, without
limitation, the approval and adoption of the Agreement and the
transactions contemplated thereby, (iv) requires divestiture by Parent or
any affiliate of Parent of any Shares or (v) otherwise materially
adversely affects the financial condition, business or results of
operations of the Company and its subsidiaries taken as a whole;
(d) all consents, registrations, approvals, permits, authorizations,
notices, reports or other filings required to be obtained or made by the
Company, Parent or Newco with or from any governmental entity in
connection with the execution and delivery of the Agreement, the Offer and
the consummation of the transactions contemplated by the Agreement shall
not have been made or obtained as of the then scheduled expiration date of
the Offer (other than the failure to receive any consent, registration,
approval, permit or authorization or to make any notice, report or other
filing that, in the aggregate, is not reasonably likely to have a Material
Adverse Effect on Parent, Newco or the Company, or would not prevent the
consummation of the Offer or the Merger);
(e) any change or development in the financial condition,
properties, business or results of operations of the Company and its
Subsidiaries that, individually or in the aggregate, has had or is
reasonably likely to have a Material Adverse Effect;
(f) the Board of Directors of the Company (or a special committee
thereof) shall have withdrawn or amended, or modified in a manner adverse
to Parent and Newco its recommendation of the Offer or the Merger, or
shall have endorsed, approved or recommended any other Acquisition
Proposal; or
(g) the Agreement shall have been terminated by the Company or
Parent or Newco in accordance with its terms or Parent or Newco shall have
reached an agreement or understanding in writing with the Company
A-3
<PAGE>
providing for termination or amendment of the Offer or delay in payment
for the Shares;
(h) the German Federal Cartel Office shall have notified Parent, or
Parent shall have become aware, that it will object to the transactions
contemplated by this Agreement;
which, in the reasonable judgment of Parent and Newco, in any such case, and
regardless of the circumstances (including any action or inaction by Parent or
Newco) giving rise to any such conditions, makes it inadvisable to proceed with
the Offer and/or with such acceptance for payment of or payment for Shares.
The foregoing conditions (other than the Minimum Condition) are for
the sole benefit of Parent and Newco and may be asserted by Parent or Newco
regardless of the circumstances (including any action or inaction by Parent or
Newco) giving rise to such condition or may be waived by Parent or Newco, in
whole or in part at any time and from time to time in its sole discretion.
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