<PAGE> 1
SCHEDULE 14A
(RULE 14A-101)
INFORMATION REQUIRED IN PROXY STATEMENT
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (AMENDMENT NO. 2)
Filed by the Registrant [ ]
Filed by a Party other than the Registrant [X]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission
Only (as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to Rule 14a-11(c) or Rule 14a-12
</TABLE>
SAFETY-KLEEN CORP.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified In Its Charter)
LAIDLAW ENVIRONMENTAL SERVICES, INC.
LES ACQUISITION, INC.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(1) and 0-11.
(1) Title of each class of securities to which transaction applies:
(2) Aggregate number of securities to which transaction applies:
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (set forth the amount on which the
filing fee is calculated and state how it was determined):
(4) Proposed maximum aggregate value of transaction:
(5) Total fee paid:
[ ] Fee paid previously with preliminary materials:
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
(2) Form, Schedule or Registration Statement No.:
(3) Filing Party:
(4) Date Filed:
<PAGE> 2
- --------------------------------------------------------------------------------
LAIDLAW ENVIRONMENTAL SERVICES INC.
DECEMBER 16, 1997
Dear Fellow Safety-Kleen Corp. Shareholder:
I am pleased to enclose our Proxy Statement for the Special Meeting of
shareholders of Safety-Kleen Corp. (the "Control Share Meeting") to be held on
January 9, 1998. Safety-Kleen has not yet informed us of the precise time and
location of the Control Share Meeting. Safety-Kleen will furnish such
information when it sends the official notice of the meeting to you.
As you may know by now, Laidlaw Environmental Services, Inc. ("Laidlaw
Environmental") has announced its intention to make an exchange offer (the
"Laidlaw Environmental Offer") to acquire all outstanding shares of the common
stock (and associated share purchase rights) (the "Shares") of Safety-Kleen
Corp. ("Safety-Kleen") for consideration per Share consisting of $15.00 in cash
(subject to reduction for certain break up fees, new severance arrangements and
certain expenses of Safety-Kleen as described in the accompanying Proxy
Statement) and common stock of Laidlaw Environmental with a market value of
$15.00 (assuming that the market value of Laidlaw Environmental common stock is
no more than $5.35714 and no less than $4.28571). The detailed terms and
conditions of the Laidlaw Environmental Offer will be set forth in Laidlaw
Environmental's prospectus and the related letter of transmittal, which will be
separately mailed to Safety-Kleen shareholders in the future. As you may also
know, on November 20, 1997, Safety-Kleen announced that it had entered into an
agreement with affiliates of Philip Services Corp. and two private investment
entities for a merger (the "Buyout Merger") in which Safety-Kleen shareholders
would receive $27 in cash per Share.
Laidlaw Environmental intends to take the Laidlaw Environmental Offer
directly to Safety-Kleen shareholders and, as a critical first step, is
soliciting your vote at the Control Share Meeting on a proposal (the "Voting
Rights Proposal") to authorize, in accordance with Wisconsin's "control share
acquisition statute," the restoration of full voting rights to any and all
Shares that Laidlaw Environmental may acquire, directly or indirectly, pursuant
to the Laidlaw Environmental Offer that would otherwise be subject to reduced
voting rights under the Wisconsin Control Share Statute.
Laidlaw Environmental urges you to vote FOR the Voting Rights Proposal for
the following reasons:
- Restoration of full voting rights is a condition to consummation of the
Laidlaw Environmental Offer. A vote FOR the Voting Rights Proposal
removes one important obstacle to the Laidlaw Environmental Offer and
helps to ensure that Safety-Kleen shareholders have an opportunity to
consider the Laidlaw Environmental Offer. Laidlaw Environmental is
committed to removing the other obstacles to the Laidlaw Environmental
Offer, but approval of the Voting Rights Proposal is a key first step.
- A vote FOR the Voting Rights Proposal continues the process of maximizing
the value of the Shares held by Safety-Kleen shareholders. Safety-Kleen
will soon be soliciting your votes to approve the Buyout Merger at a
meeting of Safety-Kleen's shareholders, and Laidlaw Environmental will
solicit your votes in opposition to that transaction. For now, the matter
before you is whether, in accordance with Wisconsin law, to restore full
voting rights to any Shares Laidlaw Environmental may acquire in the
Laidlaw Environmental Offer.
1301 Gervais Street, Suite 300 (29201) Post Office Box 11393 (29211)
Columbia, South Carolina Phone 803.933.4200
<PAGE> 3
- A vote FOR the Voting Rights Proposal simply keeps your options open.
Voting for the Voting Rights Proposal is neither an acceptance nor an
endorsement of the Laidlaw Environmental Offer, and voting for the Voting
Rights Proposal does not serve as a tender of your Shares or require that
you tender your Shares.
Detailed information concerning the Voting Rights Proposal and the
Wisconsin control share acquisition statute is set forth in the accompanying
Proxy Statement. Because approval of the Voting Rights Proposal is a condition
to Laidlaw Environmental's obligation to consummate the Laidlaw Environmental
Offer (unless Laidlaw Environmental is satisfied in its reasonable discretion
that the Wisconsin control share acquisition statute is invalid or
inapplicable), Laidlaw Environmental has an interest in the proxy solicitation
with respect to the Voting Rights Proposal that is different from other
Safety-Kleen shareholders. We urge you to carefully read the enclosed material,
as it is important that your Safety-Kleen shares be represented and voted at the
Control Share Meeting.
If you have any questions concerning the enclosed Proxy Statement or need
assistance in voting your Shares, please contact our Information Agent, Morrow &
Co., Inc., at 1-800-662-5200 or call collect at (212) 754-8000.
We thank you in advance for your support.
Sincerely,
Kenneth W. Winger
President and Chief Executive
Officer
Laidlaw Environmental Services,
Inc.
THIS PROXY STATEMENT RELATES SOLELY TO THE SOLICITATION OF PROXIES WITH RESPECT
TO THE VOTING RIGHTS PROPOSAL AND IS NEITHER A REQUEST FOR THE TENDER OF SHARES
OF SAFETY-KLEEN COMMON STOCK NOR AN OFFER OF SHARES OF LAIDLAW ENVIRONMENTAL
COMMON STOCK. THE LAIDLAW ENVIRONMENTAL OFFER WILL BE MADE ONLY BY MEANS OF THE
LAIDLAW ENVIRONMENTAL PROSPECTUS AND LETTER OF TRANSMITTAL WHICH WILL BE
SEPARATELY MAILED TO SAFETY-KLEEN SHAREHOLDERS IN THE FUTURE.
2
<PAGE> 4
DATED DECEMBER 16, 1997
PROXY STATEMENT
OF
LAIDLAW ENVIRONMENTAL SERVICES, INC.
AND
LES ACQUISITION, INC.
FOR THE
SPECIAL MEETING OF SHAREHOLDERS
UNDER SECTION 180.1150(5)
OF THE WISCONSIN STATUTES
OF
SAFETY-KLEEN CORP.
TO BE HELD ON JANUARY 9, 1998
This Proxy Statement is being furnished to holders of outstanding Common
Shares, par value $0.10 per share, including the associated Rights (as defined
below) (the "Shares"), of Safety-Kleen Corp., a Wisconsin corporation
("Safety-Kleen"), in connection with the solicitation by Laidlaw Environmental
Services, Inc., a Delaware corporation ("Laidlaw Environmental"), and by LES
Acquisition, Inc., a Delaware corporation and an indirect wholly owned
subsidiary of Laidlaw Environmental ("LES Acquisition"), of proxies to be voted
at a Special Meeting of Shareholders of Safety-Kleen to be held on January 9,
1998, and at any adjournments or postponements thereof (the "Control Share
Meeting"), on a proposal (the "Voting Rights Proposal") to authorize, in
accordance with Section 180.1150 (the "Wisconsin Control Share Statute") of the
Wisconsin Statutes, the restoration of full voting power to any and all Shares
acquired by Laidlaw Environmental and LES Acquisition (or one or more other
direct or indirect subsidiaries of Laidlaw Environmental). The precise time and
location of the Control Share Meeting will be determined and announced by
Safety-Kleen, and Safety-Kleen will furnish such information to shareholders of
record as of the record date for the meeting when it distributes the official
notice of the Control Share Meeting.
This Proxy Statement is first being sent or given to shareholders on or
about December 16, 1997. The record date for the Control Share Meeting is the
close of business on December 19, 1997 (the "Record Date"). The principal
executive offices of Safety-Kleen are located at 1000 North Randall Road, Elgin,
Illinois 60123.
Laidlaw Environmental has announced its intention to commence an offer (the
"Laidlaw Environmental Offer") to exchange (i) $15.00 net in cash (subject to
reduction) and (ii) shares of Common Stock, par value $1.00 per share, of
Laidlaw Environmental ("Laidlaw Environmental Common Stock"), with a market
value of $15.00 (assuming that the market value of Laidlaw Environmental Common
Stock is no more than $5.35714 and no less than $4.28571), for each outstanding
Share, including the associated Common Share Purchase Rights (the "Rights")
granted under that certain Rights Agreement, dated as of November 9, 1988,
between Safety-Kleen and First National Bank of Chicago, as Rights Agent, as
amended (the "Rights Agreement"), validly tendered and not properly withdrawn.
The amount of the cash consideration is subject to reduction for certain break
up fees, new severance costs and expenses of Safety-Kleen, and the actual value
of Laidlaw Environmental Common Stock to be exchanged pursuant to the Laidlaw
Environmental Offer may vary. Laidlaw Environmental has filed with the
Securities and Exchange Commission (the "Commission") a Registration Statement
on Form S-4 (as amended from time to time, the "Registration Statement") which
contains a preliminary prospectus setting forth the terms and conditions of the
Laidlaw Environmental Offer (the "Laidlaw Environmental Preliminary
Prospectus"). The Laidlaw Environmental Offer will be made solely pursuant to
the definitive prospectus (the "Laidlaw Environmental Prospectus") included in
the Registration Statement, the Tender Offer Statement on Schedule 14D-1 (the
"Schedule 14D-1") to be filed prior to the commencement of the Laidlaw
Environmental Offer and the related letter of transmittal (the "Letter of
Transmittal"), which will be mailed separately to the shareholders of
Safety-Kleen immediately after the Commission declares the Registration
Statement effective. This Proxy Statement is neither a request for the tender of
Shares nor an offer with respect thereto.
As more fully described below under "WISCONSIN CONTROL SHARE STATUTE," the
Wisconsin Control Share Statute generally provides that (subject to certain
exceptions) the voting power of voting securities
<PAGE> 5
of a "resident domestic corporation" held by any person or entity in excess of
20% of the voting power in the election of directors is limited to 10% of the
full voting power of those securities, unless the shareholders of the resident
domestic corporation have voted to approve the person's or entity's request to
restore the full voting power of such person's or entity's voting securities.
The Control Share Meeting has been called at the request of Laidlaw
Environmental to enable Safety-Kleen Shareholders to vote on such a resolution
with respect to Shares it may acquire in the Laidlaw Environmental Offer or
otherwise.
A copy of the Registration Statement, and, after its filing with the
Commission, a copy of the Schedule 14D-1 and all amendments thereto, may be
obtained from the Commission upon payment of the Commission's customary charges,
by writing to its principal office at 450 Fifth Street, N.W., Judiciary Plaza,
Room 1024, Washington, D.C. 20549. Such material is also available for
inspection and copying at the principal office of the Commission at the address
set forth immediately above, 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, and at the offices of the
New York Stock Exchange, 20 Broad Street, New York, New York 10005. Such
material should also be available on-line through the Commission's EDGAR system.
VOTING IN FAVOR OF THE VOTING RIGHTS PROPOSAL WILL NOT REQUIRE YOU TO
TENDER YOUR SHARES IN THE LAIDLAW ENVIRONMENTAL OFFER. CONSUMMATION OF THE
LAIDLAW ENVIRONMENTAL OFFER, HOWEVER, WILL BE CONDITIONED UPON, AMONG OTHER
THINGS, AUTHORIZATION BY SHAREHOLDERS OF SAFETY-KLEEN OF THE VOTING RIGHTS
PROPOSAL (OR LES ACQUISITION AND LAIDLAW ENVIRONMENTAL BEING SATISFIED, IN THEIR
REASONABLE DISCRETION, THAT THE WISCONSIN CONTROL SHARE STATUTE IS INVALID OR
INAPPLICABLE TO SUCH ACQUISITION). ACCORDINGLY, IT IS IMPORTANT THAT
SHAREHOLDERS WHO WISH TO CONSIDER THE LAIDLAW ENVIRONMENTAL OFFER, OR WHO WISH
TO HAVE THE OPPORTUNITY TO TENDER THEIR SHARES IN THE LAIDLAW ENVIRONMENTAL
OFFER, VOTE FOR THE AUTHORIZATION OF THE VOTING RIGHTS PROPOSAL ON THE ENCLOSED
BLUE-STRIPED PROXY CARD.
BY VOTING IN FAVOR OF THE VOTING RIGHTS PROPOSAL, A SHAREHOLDER WOULD NOT
BE PROHIBITED FROM LATER VOTING AGAINST ANY PROPOSED BUSINESS COMBINATION
INVOLVING SAFETY-KLEEN, LAIDLAW ENVIRONMENTAL OR LES ACQUISITION.
When the Laidlaw Environmental Offer is commenced, tendering Shares
pursuant to the Laidlaw Environmental Offer will NOT constitute a vote in favor
of the Voting Rights Proposal. Instead, you must vote for the Voting Rights
Proposal by using the enclosed BLUE-STRIPED proxy card or by voting in person at
the Control Share Meeting.
If you have any questions about the voting of Shares, the Laidlaw
Environmental Offer or the Voting Rights Proposal, please contact Morrow & Co.,
Inc. ("Morrow & Co.") at 909 Third Avenue, New York, New York 10022, or by
telephone at 212/754-8000 (call collect) or 800/662-5200 (toll free).
BACKGROUND OF THE SOLICITATION
On August 8, 1997 Safety-Kleen announced the resignation of John G.
Johnson, Jr., President and Chief Executive Officer of Safety-Kleen. Donald W.
Brinckman, Chairman of Safety-Kleen's Board of Directors, who had previously
served as Safety-Kleen's Chief Executive Officer from 1968 until December 31,
1994, was appointed Chief Executive Officer. Safety-Kleen also announced that
its Board of Directors had engaged the services of William Blair & Company
("William Blair") to act as adviser to Safety-Kleen and to manage the process of
exploring strategic options for enhancing shareholder value.
On August 8, 1997, William Blair sent a copy of the Safety-Kleen
confidentiality letter to one of Laidlaw Environmental's investment bankers, Mr.
David E. Thomas, Jr. of Raymond James & Associates, Inc. ("Raymond James") and
stated that an offering circular would be available early in the week of August
18, 1997, and that such circular would be distributed to parties that had
executed a confidentiality agreement. Laidlaw Environmental did not respond to
this letter and William Blair called Laidlaw Environmental's representative and
asked that Laidlaw Environmental sign the confidentiality agreement. Laidlaw
Environmental was willing to sign
2
<PAGE> 6
a confidentiality agreement, but not the one proposed by Safety-Kleen, which
contained a standstill provision that would prohibit Laidlaw Environmental for a
period of two years from submitting any proposal to acquire Safety-Kleen unless
such proposal is directed solely to the management of Safety-Kleen and
Safety-Kleen shall have requested in advance the submission of such proposal.
In mid-September 1997, there were further discussions between the two
investment banks in which Laidlaw Environmental's representatives requested a
meeting of the two companies and their advisors so that Laidlaw Environmental
could fully describe why a business combination was in both companies' best
interests. Safety-Kleen's representative continued to request that Laidlaw
Environmental sign a confidentiality agreement containing the two-year
standstill provision. He also stated that if Laidlaw Environmental would submit
its proposal in writing, Safety-Kleen would consider a meeting with Laidlaw
Environmental.
On September 24, 1997, Mr. Thomas delivered a letter to Mr. Jeffrey W.
Corum of William Blair, informing Mr. Corum of Laidlaw Environmental's interest
in pursuing negotiations with Safety-Kleen. In particular, Mr. Thomas's letter
requested a meeting between the management of Laidlaw Environmental and the
management of Safety-Kleen and pointed out several unique features of Laidlaw
Environmental's proposed transaction, including the potential cost savings
available from combining the operations of Laidlaw Environmental and
Safety-Kleen.
Shortly thereafter Mr. Corum responded to Mr. Thomas's letter by telephone
stating that only upon Laidlaw Environmental's delivery of a confidentiality and
standstill agreement acceptable to Safety-Kleen, would Safety-Kleen meet with
Laidlaw Environmental. Subsequent to their telephone conversations, Mr. James R.
Bullock, Chairman of Laidlaw Environmental, attempted to call Mr. Brinckman, who
did not return his call. Mr. Bullock then called Mr. E. David Coolidge of
William Blair in an effort to arrange a meeting with Safety-Kleen. Mr. Coolidge
repeated Safety-Kleen's refusal to meet with Laidlaw Environmental in the
absence of a confidentiality and standstill agreement.
On November 3, 1997, the Laidlaw Environmental Board of Directors met and
determined to proceed with the Initial Offer (as defined below) as well as to
retain Bear, Stearns & Co. Inc. ("Bear Stearns") to work together with Raymond
James as its financial adviser. Laidlaw Environmental management had previously
retained Katten Muchin & Zavis to serve as legal counsel. Also on November 3,
1997, in a letter to Mr. Brinckman, Mr. Bullock informed Mr. Brinckman and the
Safety-Kleen Board of Directors of Laidlaw Environmental's intention to acquire
Safety-Kleen for a price per Share of $14.00 in cash and 2.4 shares of Laidlaw
Environmental Common Stock (the "Initial Offer"), that Laidlaw Environmental was
willing to execute a confidentiality agreement provided such agreement did not
contain a standstill provision. Mr. Bullock stated that Laidlaw Environmental
would consider and pursue various options with respect to an acquisition of
Safety-Kleen notwithstanding Safety-Kleen's refusal to meet with representatives
of Laidlaw Environmental. The letter also informed Mr. Brinckman that Laidlaw
Environmental had executed a commitment letter with Toronto-Dominion Bank to
provide all necessary financing for the Initial Offer and the merger and again
encouraged Mr. Brinckman and the Safety-Kleen Board of Directors to meet with
representatives of Laidlaw Environmental to discuss the possibility of a
mutually beneficial negotiated transaction.
On November 3, 1997 after receipt of Mr. Bullock's letter, Mr. Brinckman
delivered a letter to Mr. Bullock requesting that Laidlaw Environmental execute
a confidentiality and standstill agreement and informing Mr. Bullock that
Safety-Kleen's Board of Directors would fully consider Laidlaw Environmental's
proposal along with others received by Safety-Kleen. In addition, Mr. Brinckman
stated that representatives of Safety-Kleen, together with its financial
advisors, would meet with representatives of Laidlaw Environmental, together
with its financial advisors, to discuss information concerning Laidlaw
Environmental and the estimated cost savings and synergies.
On November 4, 1997, Laidlaw Environmental publicly announced its intention
to commence the Initial Offer.
On November 5, 1997, Mr. Bullock and a representative of Bear Stearns met
with Mr. Brinckman, Mr. Joseph Chalhoub, Senior Vice President of Safety-Kleen,
and representatives of William Blair to discuss potential synergies that could
be achieved through a combination of the two companies and ways the parties
could work together. Mr. Bullock stated that Laidlaw Environmental was prepared
to sign a mutual confidential-
3
<PAGE> 7
ity agreement that would not contain a standstill provision so that Laidlaw
Environmental and Safety-Kleen could share information with each other. In
response, Safety-Kleen repeated its requirement that Laidlaw Environmental sign
a confidentiality and standstill agreement.
Subsequent to the November 5th meeting, the representatives of the parties
exchanged correspondence reiterating their positions with respect to the
confidentiality and standstill agreement.
On November 13, 1997, Laidlaw Environmental filed the Registration
Statement. A copy of the Registration Statement was sent to Mr. Brinckman, along
with a letter from Mr. Bullock emphasizing the strategic importance of combining
the two companies and reiterating Laidlaw Environmental's desire to engage in
negotiations with Safety-Kleen. Mr. Bullock also expressed Laidlaw
Environmental's willingness to put the decision to accept the Initial Offer
directly to Safety-Kleen shareholders. Mr. Bullock requested the cooperation of
the Safety-Kleen Board of Directors in eliminating any antitakeover obstacles
which would prohibit the shareholders from accepting the Initial Offer.
On November 13, 1997, Laidlaw Environmental also sent a notice to
Safety-Kleen pursuant to Section 180.1150 of the Wisconsin Statutes requesting
that the Safety-Kleen Board of Directors convene a special meeting of
shareholders and submit for shareholder approval a resolution to restore regular
voting power to any Shares Laidlaw Environmental would acquire as a result of
the Laidlaw Environmental Offer.
By a second letter dated November 13, 1997, Laidlaw Environmental, having
in its judgment complied with the Wisconsin Statutes, also requested the right
to inspect and copy the Safety-Kleen shareholder list for the purpose of
communicating directly with Safety-Kleen shareholders.
On November 17, 1997, Safety-Kleen commenced litigation in the United
States District Court for the Northern District of Illinois seeking, among other
things, an order declaring that it was not required to call a special
shareholders meeting as requested by Laidlaw Environmental or to provide a
shareholders list to Laidlaw Environmental.
On November 20, 1997, Safety-Kleen announced that it had entered into a
Merger Agreement, dated as of November 20, 1997 (the "Buyout Merger Agreement"),
with newly formed affiliates of Philip Services Corp., Apollo Management, L.P.
and Blackstone Management Partners III L.L.C. (the "Buyout Group"). Pursuant to
the Buyout Merger Agreement, an acquisition subsidiary formed by the Buyout
Group would merge with and into Safety-Kleen (the "Buyout Merger"), with
Safety-Kleen as the surviving company in a transaction in which Safety-Kleen
shareholders would receive $27.00 per Share in cash. As a result of the Buyout
Merger, Safety-Kleen would become a wholly-owned subsidiary of a new holding
company formed by the Buyout Group and would continue to operate under its
current management and out of its current headquarters. The closing of the
Buyout Merger is subject to certain conditions, including the approval of at
least 66 2/3% of Safety-Kleen's shareholders and both the debt and equity
funding of the financing arrangements of the Buyout Group. Pursuant to the
Buyout Merger Agreement, Safety-Kleen is required to pay a termination fee of
$50 million and to reimburse the Buyout Group for its expenses in an amount up
to $25 million under certain conditions, including in the event that the Buyout
Merger Agreement is terminated and the Laidlaw Environmental Offer is accepted
by Safety-Kleen shareholders.
Later that day, in a letter from Mr. Bullock to Mr. Brinckman, Laidlaw
Environmental increased its per Share offer to $15.00 in cash (subject to
reduction for break-up fees, new severance arrangements and other expenses as
described below), and common stock of Laidlaw Environmental with a market value
of $15.00 (assuming that the market value of Laidlaw Environmental Common Stock
is no more than $5.35714 and no less than $4.28571). The cash consideration to
be paid pursuant to the Laidlaw Environmental Offer will be reduced on a pro
rata basis by the amount of (i) any termination fees or expenses paid or
reimbursed (or payable or reimbursable) by Safety-Kleen pursuant to the Buyout
Merger Agreement and (ii) any incremental costs, including the costs of new
severance arrangements and other expenses Safety-Kleen may incur in connection
with the Buyout Merger Agreement. The actual value of the Laidlaw Environmental
Common Stock to be exchanged pursuant to the Laidlaw Environmental Offer may
vary. The detailed terms and conditions of the Laidlaw Environmental Offer will
be set forth in the Laidlaw Environmental Prospectus and the related Letter of
4
<PAGE> 8
Transmittal, which will be separately mailed to the shareholders of Safety-Kleen
immediately after the Commission declares the Registration Statement effective.
On November 24, 1997, Laidlaw Environmental filed a counterclaim in the
United States District Court for the Northern District of Illinois, against
Safety-Kleen and its Board of Directors seeking, among other things, preliminary
and permanent injunctive relief declaring invalid the termination fee and
expense reimbursement provisions of the Buyout Merger Agreement, and any
severance arrangements for the benefit of Safety-Kleen management that may have
been entered into by Safety-Kleen in connection with the Buyout Merger
Agreement. Laidlaw Environmental has submitted a request in writing to
Safety-Kleen for a statement setting forth any incremental costs, including the
cost of new severance arrangements and other expenses that Safety-Kleen has
incurred or may reasonably be expected to incur in connection with the Buyout
Merger Agreement.
On November 26, 1997, Safety-Kleen filed a proxy statement on Schedule 14A
with respect to the proposal to consider and approve the Buyout Merger Agreement
and the Buyout Merger.
On December 2, 1997, Laidlaw Environmental and LES Acquisition filed this
proxy statement on Schedule 14A with respect to the proposal to consider and
approve the Voting Rights Proposal.
On December 9, 1997, in compliance with the court ruling of December 4,
1997 (See "LITIGATION"), Safety-Kleen announced that the Control Share Meeting
would be held on January 9, 1998, with a record date of December 19, 1997.
WISCONSIN CONTROL SHARE STATUTE
Section 180.1150(2) of the Wisconsin Control Share Statute provides that
unless otherwise provided in the articles of incorporation of a resident
domestic corporation and except as otherwise provided in Section 180.1150, the
voting power of voting securities of a resident domestic corporation held by any
person or entity in excess of 20% of the voting power in the election of
directors shall be limited to 10% of the full voting power of such voting
securities. Based upon the information it has received to date, Laidlaw
Environmental has been unable to determine definitively whether Safety-Kleen is
a "resident domestic corporation" for purposes of the Wisconsin Statutes.
However, under Section 180.1150, certain voting securities, including
shares acquired from the resident domestic corporation, shares acquired under an
agreement entered into at any time when the resident domestic corporation was
not a resident domestic corporation, and shares acquired in a transaction
incident to which the shareholders of the resident domestic corporation have
voted to restore the full voting power of all of such acquiring person's shares,
are not subject to the voting power restriction.
Pursuant to Section 180.1150(4), a purchaser or potential purchaser of
shares of a resident domestic corporation may request that a resolution
restoring the full voting power of all shares acquired by such purchaser be
submitted to the shareholders of the resident domestic corporation for their
approval. A person or entity desiring a shareholder vote must deliver to the
resident domestic corporation at its principal office a form of shareholder
resolution with an accompanying notice containing the following information: (i)
the identity of the person or entity submitting the resolution, (ii) a statement
that the resolution and notice are submitted under Section 180.1150, (iii) the
number of shares of the resident domestic corporation beneficially owned by the
person or entity submitting the resolution, (iv) a specification of the voting
power the person or entity has acquired or proposes to acquire for which
shareholder approval is sought, (v) the circumstances, terms and conditions
under which shares representing in excess of 20% of the voting power were
acquired or are proposed to be acquired, set forth in reasonable detail,
including the source of funds or consideration and other details of the
arrangements of the transaction or transactions, and (vi) if the shares are
acquired for purposes of gaining control of the resident domestic corporation,
the terms of the proposed acquisition, including source of funds, material terms
of financial arrangements, plans or proposals with respect to the resident
domestic corporation or its assets, plans to change the location of its
principal office, its business activities, its management or policies of
employment, its relationship with suppliers, customers, or communities, and
other material information which would affect the decision of shareholders with
respect to the Voting Rights Proposal.
5
<PAGE> 9
Under Section 180.1150(5) a resident domestic corporation must, within 10
days of receipt of the resolution and notice as described above, fix a date for
a special meeting of the shareholders to vote on the resolution. The meeting
must be no later than 50 days after receipt of the resolution and notice unless
the person or entity submitting the notice agrees to a later date, and no
earlier than 30 days after receipt of the resolution and notice if the person
submitting the resolution and notice so requests. The resident domestic
corporation shall include with its notice to shareholders a copy of the
resolution and notice delivered by the entity seeking to have full voting power
restored, and the notice to shareholders shall also include a statement by the
directors of the resident domestic corporation as to their position or lack of
position on the resolution.
Regular voting power will be restored to the voting securities held by the
person or entity requesting the restoration if, at a meeting at which a quorum
is present, a majority of the voting power of shares represented at the meeting
and entitled to vote approves the resolution to restore full voting power.
Dissenters' rights are not available to shareholders of a resident domestic
corporation in connection with the restoration of voting power, but may be
available to shareholders in connection with the merger that Laidlaw
Environmental intends to effect following the consummation of the Laidlaw
Environmental Offer.
THE FOREGOING IS A SUMMARY OF THE RELEVANT PROVISIONS OF THE WISCONSIN
CONTROL SHARE STATUTE AND THE RELATED PROVISIONS OF THE WISCONSIN STATUTES. THE
FOREGOING SUMMARY IS COMPLETE IN ALL MATERIAL RESPECTS BUT IS QUALIFIED IN ITS
ENTIRETY BY REFERENCE TO SUCH STATUTES.
LITIGATION
Between November 4, 1997 and November 12, 1997, six class action lawsuits
were filed against Safety-Kleen and various directors of Safety-Kleen by
Safety-Kleen shareholders not affiliated with Laidlaw Environmental. In general,
these lawsuits seek to (i) cause Safety-Kleen to cooperate with any entity or
person having a bona fide interest in a transaction with Safety-Kleen, (ii)
order the Safety-Kleen Board of Directors to appropriately evaluate
Safety-Kleen's value and to take appropriate steps to enhance this value, and
(iii) cause Safety-Kleen's Board of Directors to act independently in the best
interest of the public shareholders of Safety-Kleen.
On November 17, 1997, Safety-Kleen commenced litigation in the United
States District Court for the Northern District of Illinois alleging that
Laidlaw Environmental violated Section 5(b)(1) of the Securities Act of 1933 by
making a "premature offer" and unlawful proxy solicitation. As a remedy for that
alleged violation, Safety-Kleen requested that it be relieved of its obligation
to provide Laidlaw Environmental with a list of its shareholders so that
Safety-Kleen will not be in the position of facilitating a violation of the
federal securities laws. The Safety-Kleen complaint further alleged that Laidlaw
Environmental's request pursuant to Section 180.1150 of the Wisconsin Statutes
that Safety-Kleen call the Control Share Meeting failed to comply with the state
law notice requirements. Safety-Kleen contends that the notice served by Laidlaw
Environmental fails to provide sufficient disclosure of the financing for the
Laidlaw Environmental Offer. Safety-Kleen sought a declaratory judgment that it
need not schedule the Control Share Meeting or provide access to its shareholder
list.
On November 24, 1997, Laidlaw Environmental filed an answer to
Safety-Kleen's complaint in which Laidlaw Environmental denied each of
Safety-Kleen's claims and raised certain affirmative defenses. On that date,
Laidlaw Environmental also filed a counterclaim against Safety-Kleen and each
member of its board of directors (the "Director Defendants") seeking, among
other things: (i) an order compelling Safety-Kleen to call the Control Share
Meeting to vote on the Voting Rights Proposal in accordance with Section
180.1150(5)(a) to restore full voting rights to any Shares acquired by Laidlaw
Environmental in the Laidlaw Environmental Offer and the proposed merger; (ii)
an order compelling the production of Safety-Kleen's shareholder lists, to be
produced promptly and at Safety-Kleen's expense; (iii) an order (w) declaring
that the Director Defendants have breached their fiduciary duties to
Safety-Kleen's shareholders, including Laidlaw Environmental, by refusing to
negotiate with Laidlaw Environmental, entering into the Buyout Merger Agreement,
and agreeing to the unlawful provisions of the Buyout Merger Agreement,
including the break-up fee, (x) compelling the Director Defendants to carry out
their fiduciary duties to Safety-Kleen's shareholders, including Laidlaw
Environmental, by
6
<PAGE> 10
implementing and adhering to procedures under which the transaction providing
the best value reasonably available can be obtained for Safety-Kleen's
shareholders, (y) enjoining Safety-Kleen and the Director Defendants from
proceeding with the Buyout Merger or paying a "break-up fee" to the Buyout
Group, and (z) directing the Director Defendants to negotiate with Laidlaw
Environmental regarding the Laidlaw Environmental Offer; (iv) an order
compelling the Director Defendants to amend Safety-Kleen's Rights Agreement to
make it inapplicable to the Laidlaw Environmental Offer or to redeem the Rights;
(v) an order (pursuant to the derivative claim) requiring the Director
Defendants to account to Safety-Kleen for waste of corporate assets and all
other damages caused by their approval of the Buyout Transaction; and (vi) an
award of costs of suit and reasonable attorneys' fees, and for such other relief
as the Court may deem just and appropriate.
On November 26, 1997, Laidlaw Environmental presented its Motion for
Preliminary Injunction in which it sought (i) an order compelling Safety-Kleen
to call the Control Share Meeting to consider the Voting Rights Proposal in
accordance with the Wisconsin Control Share Statute to restore full voting
rights to any Shares acquired by Laidlaw Environmental and (ii) an order
compelling the production of the Safety-Kleen shareholder list.
In a ruling issued on December 4, 1997, the United States District Court
for the Northern District of Illinois ordered Safety-Kleen to comply with the
provisions of the Wisconsin Control Share Statute by calling a meeting of the
Safety-Kleen shareholders to consider the Voting Rights Proposal and providing
its shareholder list to Laidlaw Environmental.
Also on December 4, 1997, Laidlaw Environmental filed a second Motion for
Preliminary Injunction in which it sought (i) to enjoin Safety-Kleen and its
Board of Directors from consummating an unlawful agreement to sell Safety-Kleen
for $27 per share or paying a "break-up fee" to the Buyout Group; (ii) to
require Safety-Kleen's Board of Directors to fulfill their fiduciary duties of
loyalty and care to Safety-Kleen's shareholders and fairly consider all offers
for the purchase of Safety-Kleen, including the Laidlaw Environmental Offer; and
(iii) to direct Safety-Kleen's Board of Directors to amend the Rights Agreement
to make it inapplicable to the Laidlaw Environmental Offer or redeem the Rights
created therein. An evidentiary hearing on the December 4 motion is scheduled to
be held on January 6, 1998.
OTHER MATTERS
Except as set forth herein, neither Laidlaw Environmental nor LES
Acquisition is aware of any other substantive matter to be considered at the
Control Share Meeting. However, if any other matter properly comes before the
Control Share Meeting, the proxies also confer authority to the persons named in
the proxy card to vote the Shares to which the proxy relates on such matter at
their discretion, including any adjournment or postponement of the Control Share
Meeting.
VOTING AT THE CONTROL SHARE MEETING
At the Control Share Meeting, shareholders of Safety-Kleen will be asked
(i) to approve a resolution of Safety-Kleen's shareholders authorizing the
Voting Rights Proposal and (ii) to confer authority to the proxies named in the
proxy card to initiate and vote for one or more proposals to adjourn the Control
Share Meeting for any reason, including to allow the solicitation of additional
votes, if necessary, to authorize the Voting Rights Proposal under the Wisconsin
Control Share Statute (the "Adjournment Proposal").
Under Safety-Kleen's bylaws, a majority of the outstanding Shares entitled
to vote, represented in person or by proxy, shall constitute a quorum at the
Control Share Meeting. If a quorum is present, authorization of the Voting
Rights Proposal pursuant to the Wisconsin Control Share Statute requires the
affirmative vote of the holders of a majority of the voting power represented by
Shares present at the Control Share Meeting in person or by proxy and entitled
to vote thereon. Under the Wisconsin Statutes, if a quorum is present, the
affirmative vote of a majority of votes cast will be required for the approval
of any Adjournment Proposal.
According to Safety-Kleen's Form 10-Q for the fiscal quarter ended
September 6, 1997, as of September 6, 1997 there were 58,400,729 Shares
outstanding.
7
<PAGE> 11
A VOTE IN FAVOR OF THE VOTING RIGHTS PROPOSAL WILL NOT REQUIRE THAT YOU
TENDER SHARES IN THE LAIDLAW ENVIRONMENTAL OFFER. APPROVAL OF THE VOTING RIGHTS
PROPOSAL WILL HELP MAKE IT POSSIBLE FOR YOU TO HAVE THE OPPORTUNITY TO DECIDE
FOR YOURSELF WHETHER TO ACCEPT THE LAIDLAW ENVIRONMENTAL OFFER. IF YOU ARE A
SHAREHOLDER OF RECORD ON THE RECORD DATE, DECEMBER 19, 1997, YOU WILL BE
ENTITLED TO VOTE AT THE CONTROL SHARE MEETING EVEN IF YOU SUBSEQUENTLY TENDER
YOUR SHARES IN THE LAIDLAW ENVIRONMENTAL OFFER.
Whether or not you plan to attend the Control Share Meeting, we urge you to
vote FOR authorization of the Voting Rights Proposal and FOR the Adjournment
Proposal by so indicating on the enclosed BLUE-STRIPED proxy card. You may
revoke a proxy at any time before it is voted by delivering a written notice of
revocation or a later dated proxy for the Control Share Meeting to Safety-Kleen,
One Brinckman Way, Elgin, Illinois 60123. Laidlaw Environmental and LES
Acquisition request that you send a copy of any revocation sent to Safety-Kleen
to Morrow & Co., Inc., 909 Third Avenue, 20th Floor, New York, New York 10022.
Proxies may also be revoked at the Control Share Meeting; however, attendance at
the Control Share Meeting will not in and of itself revoke a proxy. Unless
revoked in the manner set forth above, proxies will be voted at the Control
Share Meeting in accordance with your instructions. In the absence of such
instructions, such proxies will be voted FOR the Voting Rights Proposal and FOR
any Adjournment Proposal.
Any abstention from voting on a proxy will count as a vote withheld and
will be included in computing the number of Shares present for purposes of
determining whether a quorum is present at the Control Share Meeting. If a
broker indicates on a proxy that it does not have discretionary authority as to
certain Shares to vote on the Voting Rights Proposal or any Adjournment Proposal
(a "broker non-vote"), those Shares will also be considered present for purposes
of determining the presence of a quorum but not entitled to vote with respect to
the applicable proposal. With respect to the Voting Rights Proposal, an
abstention will have the same effect as a vote AGAINST the Voting Rights
Proposal, since abstentions will be counted in computing the number of Shares
represented and entitled to vote at the Control Share Meeting, while broker
non-votes will not be so counted and consequently will have no effect on the
vote. With respect to any Adjournment Proposal, since abstentions and broker
non-votes are not considered votes cast, neither will have any effect on the
voting for such proposal. The inspector of election appointed by Safety-Kleen's
Board of Directors and Laidlaw Environmental will determine the Shares
represented at the meeting and the validity of the proxies and ballots, and will
count all votes and ballots. The voting requirements and procedures described
herein are based upon provisions of the Wisconsin Statutes, Safety-Kleen's
charter documents and interpretations deemed relevant.
Only holders of record of Shares as of the close of business on the Record
Date will be entitled to vote. If you are a shareholder of record on the Record
Date, you will retain your voting rights for the Control Share Meeting even if
you sell such Shares after the Record Date or if you tender such Shares pursuant
to the Laidlaw Environmental Offer. The tender of Shares pursuant to the Laidlaw
Environmental Offer does not constitute the grant to Laidlaw Environmental or
LES Acquisition of a proxy or any voting rights with respect to the tendered
Shares until such time as such Shares are accepted for payment by Laidlaw
Environmental and LES Acquisition. Accordingly, it is important that you vote
the Shares held by you on the Record Date, or grant a proxy to vote such Shares
on the enclosed BLUE-STRIPED proxy card even if you sell such Shares after the
Record Date or tender such Shares pursuant to the Laidlaw Environmental Offer.
If any of your Shares are held in the name of a brokerage firm, bank, bank
nominee or other institution on the Record Date, only it can execute a proxy for
such Shares and will do so only upon receipt of your specific instructions.
Accordingly, please contact the person responsible for your account and instruct
that person to execute the BLUE-STRIPED proxy card.
PLEASE PROMPTLY SIGN, DATE AND MAIL THE ENCLOSED BLUE-STRIPED PROXY CARD.
NO POSTAGE WILL BE REQUIRED IF MAILED IN THE UNITED STATES. BY SIGNING AND
MAILING THE BLUE-STRIPED PROXY CARD, ANY PROXY PREVIOUSLY SIGNED BY YOU WITH
RESPECT TO THE VOTING RIGHTS PROPOSAL WILL BE AUTOMATICALLY REVOKED.
8
<PAGE> 12
SOLICITATION OF PROXIES
This solicitation is not being made by or on behalf of Safety-Kleen or
Safety-Kleen's Board of Directors. Proxies may be solicited by mail, telephone,
telecopier, e-mail, telegram and in person. Solicitations may be made by
directors, officers, investor relations personnel and other employees of Laidlaw
Environmental or LES Acquisition, none of whom will receive additional
compensation for such solicitations. Laidlaw Environmental also anticipates that
certain officers, directors, employees or representatives of Morrow & Co., Bear
Stearns and Raymond James may communicate in person, by telephone or otherwise
with shareholders of Safety-Kleen for the purpose of assisting in the
solicitation of proxies. Additional information concerning such participants in
the solicitation of proxies is listed in Schedule I attached hereto. Laidlaw
Environmental has requested banks, brokerage houses and other custodians,
nominees and fiduciaries to forward all of its solicitation materials to the
beneficial owners of the Shares they hold of record. Laidlaw Environmental will
reimburse these record holders for customary clerical and mailing expenses
incurred by them in forwarding these materials to their customers.
Laidlaw Environmental has retained Morrow & Co. for solicitation and
advisory services in connection with this solicitation. Laidlaw Environmental
has also retained Morrow & Co. to act as Information Agent in connection with
the Laidlaw Environmental Offer. Laidlaw Environmental will pay Morrow & Co.
usual and customary compensation for all such services, including up to $175,000
as compensation for this solicitation, and will reimburse Morrow & Co. for
reasonable out-of-pocket expenses in connection therewith. Laidlaw Environmental
has agreed to indemnify Morrow & Co. against certain liabilities and expenses in
connection with the Laidlaw Environmental Offer, including, but not limited to,
certain liabilities under the federal securities laws. Morrow & Co. will solicit
proxies from individuals, brokers, bank nominees and other institutional
holders.
Bear Stearns is acting as financial advisor to Laidlaw Environmental in
connection with its effort to acquire Safety-Kleen and as Dealer Manager in
connection with the Laidlaw Environmental Offer, for which services Laidlaw
Environmental has paid to Bear Stearns aggregate fees equal to $1,500,000, and
has agreed to pay additional amounts to Bear Stearns (up to a maximum of
$3,250,000).
Raymond James is also acting as financial advisor to Laidlaw Environmental
in connection with its effort to acquire Safety-Kleen, for which services, and
for assistance rendered by Raymond James in connection with prior purchases of
Shares by Laidlaw Environmental, Laidlaw Environmental has agreed to pay Raymond
James aggregate fees up to a maximum of $1,000,000 (all of which is contingent
upon consummation of the Merger).
Laidlaw Environmental has also agreed to reimburse each of the financial
advisors for all out-of-pocket expenses incurred by such financial advisors
(including consultant and attorney's fees), and has agreed to indemnify each of
Bear Stearns and Raymond James and certain related persons and entities against
certain liabilities and expenses in connection with their respective
engagements, including certain liabilities under the federal securities laws. In
connection with each of Bear Stearns' and Raymond James' engagement, Laidlaw
Environmental anticipates that certain employees of Bear Stearns and Raymond
James may communicate in person, by telephone or otherwise with a limited number
of institutions, brokers or other persons who are Safety-Kleen shareholders.
Neither Bear Stearns nor Raymond James will receive any fee for or in connection
with such solicitation activities by its employees apart from the fees it is
otherwise entitled to receive as described above.
In addition to the fees to be received by each of Bear Stearns and Raymond
James in connection with its engagement as financial advisor to Laidlaw
Environmental, Raymond James has in the past rendered various investment banking
and financial advisory services for Laidlaw Environmental for which it has
received customary compensation. Both Bear Stearns and Raymond James may in the
future render services to Laidlaw Environmental for which they will receive
customary fees.
Except as set forth above, neither Laidlaw Environmental nor, to the best
of Laidlaw Environmental's knowledge, any subsidiary, entity, or person acting
on its behalf has retained any other person to make solicitations or
recommendations to security holders on its behalf in connection with the
solicitation of proxies.
The entire expense of soliciting proxies for the Control Share Meeting is
being borne by Laidlaw Environmental or a subsidiary of Laidlaw Environmental.
Neither Laidlaw Environmental nor any such subsidiary will seek reimbursement
for such expenses from Safety-Kleen. In addition to the above costs, costs
9
<PAGE> 13
incidental to soliciting proxies for the Control Share Meeting for printing,
postage, legal and related expenses are expected to be approximately $500,000.
If Laidlaw Environmental should terminate, or materially amend the terms
of, the Laidlaw Environmental Offer prior to the Control Share Meeting, Laidlaw
Environmental or LES Acquisition will disseminate such information regarding
such changes to Safety-Kleen shareholders and, in appropriate circumstances,
will provide Safety-Kleen shareholders with a reasonable opportunity to revoke
their proxies prior to the Control Share Meeting.
INTEREST OF LAIDLAW ENVIRONMENTAL IN THE VOTING RIGHTS PROPOSAL
If the Voting Rights Proposal is approved and Laidlaw Environmental
acquires additional Shares to bring its ownership level above 20 percent of the
outstanding Shares, Laidlaw Environmental will be able to vote all of the Shares
of Safety-Kleen that it holds.
SHAREHOLDER PROPOSALS
According to the preliminary proxy materials filed by Safety-Kleen with the
Commission on November 26, 1997, the deadline for receipt of shareholders'
proposals for inclusion in Safety-Kleen's proxy material for the 1998 Annual
Meeting of Shareholders was November 21, 1997.
10
<PAGE> 14
OTHER INFORMATION
Laidlaw Environmental was incorporated in Delaware in 1968. Its principal
executive office is located at 1301 Gervais Street, Suite 300, Columbia, South
Carolina, 29201. Its telephone number is (803) 933-4200. Laidlaw Environmental
provides hazardous industrial waste management services throughout North
America. Laidlaw Environmental collects, transports, treats and disposes of
waste by incineration, landfilling and other methods at its facilities located
in the United States and Canada. Laidlaw Environmental also operates waste
processing, recycling and repackaging facilities and has analytical laboratories
at its facilities in several states.
LES Acquisition is a newly incorporated Delaware corporation and an
indirect wholly owned subsidiary of Laidlaw Environmental which to date has not
conducted any business other than in connection with the Laidlaw Environmental
Offer and the proposed merger. LES Acquisition's Executive Office is located at
1301 Gervais Street, Suite 300, Columbia, South Carolina, 29201.
Certain information about the directors and executive officers of Laidlaw
Environmental and LES Acquisition and certain employees and other
representatives of Laidlaw Environmental who may also assist Morrow & Co. in
soliciting proxies is set forth in the attached Schedule I. Schedule II sets
forth certain information relating to Shares owned by Laidlaw Environmental, LES
Acquisition, Bear Stearns and Raymond James. Schedule III sets forth certain
information, as made available in public documents, regarding Shares held by
Safety-Kleen's principal shareholders and its management.
THIS PROXY STATEMENT IS NEITHER A REQUEST FOR THE TENDER OF SHARES OF
SAFETY-KLEEN COMMON STOCK NOR AN OFFER OF SHARES OF LAIDLAW ENVIRONMENTAL COMMON
STOCK. THE LAIDLAW ENVIRONMENTAL OFFER WILL BE MADE ONLY BY MEANS OF THE LAIDLAW
ENVIRONMENTAL PROSPECTUS AND THE RELATED LETTER OF TRANSMITTAL, WHICH WILL BE
SEPARATELY MAILED TO SAFETY-KLEEN SHAREHOLDERS AFTER THE EFFECTIVE DATE OF THE
REGISTRATION STATEMENT.
PLEASE COMPLETE, SIGN AND DATE THE BLUE-STRIPED PROXY CARD ENCLOSED AND
RETURN IT PROMPTLY TO MORROW & CO., INC., 909 THIRD AVENUE, 20TH FLOOR, NEW
YORK, NEW YORK 10022. NO POSTAGE WILL BE NECESSARY IF THE ENVELOPE IS MAILED IN
THE UNITED STATES.
LAIDLAW ENVIRONMENTAL SERVICES, INC.
LES ACQUISITION, INC.
December 16, 1997
11
<PAGE> 15
SCHEDULE I
DIRECTORS AND EXECUTIVE OFFICERS
OF LAIDLAW ENVIRONMENTAL AND LES ACQUISITION
Directors and Executive Officers of Laidlaw Environmental and LES
Acquisition. The name, business address, present principal occupation or
employment and five-year employment history of each of the directors and
executive officers of Laidlaw Environmental and LES Acquisition are set forth
below. Unless otherwise indicated, each occupation set forth opposite an
individual's name refers to employment with Laidlaw Environmental. Unless
otherwise indicated, each director and executive officer listed below is a
citizen of the United States.
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR EMPLOYMENT DURING THE
NAME AND BUSINESS ADDRESS AGE LAST FIVE YEARS, DIRECTORSHIPS OF PUBLIC COMPANIES
------------------------- --- --------------------------------------------------
<S> <C> <C>
Kenneth W. Winger............................... 59 President, Chief Executive Officer and Director of
President, Chief Executive Officer and Director Laidlaw Environmental since May 15, 1997;
of Laidlaw Environmental President and sole Director of LES Acquisition,
1301 Gervais Street, Suite 300 Inc. since November 12, 1997; President, Chief
Columbia, S.C. 29201 Operating Officer and sole director of Laidlaw
Environmental Services (US), Inc. from July 1995
until May 1997; Executive Vice President for
Business Development of Laidlaw Waste Systems,
Ltd. from January 1995 until July 1995; from May
1991 until December 1994, Senior Vice President
for Corporate Development of Laidlaw Inc. Mr.
Winger also is a director of ViroGroup, Inc.
Non-U.S. citizen.
James R. Bullock................................ 53 President and Chief Executive Officer of Laidlaw,
Director of Laidlaw Environmental and Chairman Inc. since October 1993; for more than a year
of the Board since May 1997 prior thereto, President and Chief Executive
Laidlaw Inc. Officer of Cadillac Fairview Corporation Limited.
3221 North Service Road Mr. Bullock also is a director of Laidlaw Inc.
Burlington, Ontario L7R 3Y8 Non-U.S. citizen.
John R. Grainger................................ 48 Executive Vice President and Chief Operating
Director of Laidlaw Environmental and Chairman Officer of Laidlaw Inc. since September 1997;
of the Board since May 1997 President and Chief Operating Officer of Laidlaw
Laidlaw Inc. Transit, Inc. since May 1992. Mr. Grainger
3221 North Service Road currently serves as Chairman of the Human
Burlington, Ontario L7R 3Y8 Resources and Compensation Committee. Non-U.S.
citizen.
Leslie W. Haworth............................... 54 Senior Vice President and Chief Financial Officer
Director of Laidlaw Environmental since May 1997 of Laidlaw, Inc. for more than five years. Mr.
Laidlaw Inc. Haworth currently serves as Chairman of the Audit
3221 North Service Road Committee. Non-U.S. citizen.
Burlington, Ontario L7R 3Y8
John W. Rollins, Sr............................. 81 Chairman of the Board and Chief Executive Officer
Director of Rollins Environmental Services, Inc. of Rollins Truck Leasing Corp. for more than five
since 1982 years. Mr. Rollins was Chairman of the Board and
Rollins Truck Leasing Corp. Chief Executive Officer of Rollins Environmental
2200 Concord Pike Services, Inc. from 1988 until May 15, 1997. Mr.
One Rollins Plaza Rollins also is a director of Matlack Systems,
Wilmington, DE 19803 Inc., Rollins, Inc., RPC, Inc. and Dover Downs
Entertainment, Inc. Mr. Rollins is the father of
John W. Rollins, Jr.
</TABLE>
12
<PAGE> 16
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR EMPLOYMENT DURING THE
NAME AND BUSINESS ADDRESS AGE LAST FIVE YEARS, DIRECTORSHIPS OF PUBLIC COMPANIES
------------------------- --- --------------------------------------------------
<S> <C> <C>
John W. Rollins Jr.............................. 55 President and Chief Operating Officer and a
Director of Rollins Environmental Services, Inc. director of Rollins Truck Leasing Corp. for more
since 1982 than five years; Chairman of the Board of Matlack
Rollins Truck Leasing Corp. Systems, Inc. for more than five years. Mr.
2200 Concord Pike Rollins was Senior Vice Chairman of the Board of
One Rollins Plaza Rollins Environmental Services, Inc. from 1988
Wilmington, DE 19803 until May 15, 1997. Mr. Rollins also is a director
of Dover Downs Entertainment, Inc. Mr. Rollins is
a member of the Human Resources and Compensation
Committee. Mr. Rollins is the son of John W.
Rollins, Sr.
David E. Thomas, Jr............................. 40 Senior Managing Director and the Head of the
Director of Laidlaw Environmental since June Investment Banking Group of Raymond James since
1997 July 1996; from 1991 until July 1996, Managing
Raymond James & Associates, Inc. Director of Raymond James. Mr. Thomas also is a
880 Carillon Parkway director of Reynolds, Smith and Hills, Inc. Mr.
St. Petersburg, FL 33716 Thomas is a member of the Human Resources and
Compensation Committee.
Henry B. Tippie................................. 70 For more than five years, Chairman of the Board
Director of Rollins Environmental Services, Inc. and President of Tippie Services; for more than
since 1982 five years, Chairman of the Executive Committee
Tippie Service, Inc. and Vice Chairman of the Board of Rollins Truck
3420 Executive Center Drive, NW Leasing Corp. Mr. Tippie was Chairman of the
Suite 163 Executive Committee of Rollins Environmental
Austin, TX 78731 Services, Inc. from 1988 until May 15, 1997. Mr.
Tippie also is a director of Matlack Systems,
Inc., Dover Downs Entertainment, Inc., RPC, Inc.
and Rollins Inc. Mr. Tippie is a member of the
Audit Committee.
James L. Wareham................................ 58 President of AK Steel Corporation since March
Director of Laidlaw Environmental 1997; from 1992 until 1996, Chief Executive
since June 1997 Officer of Wheeling-Pittsburgh Steel Corporation.
AK Steel Corporation Mr. Wareham is a member of the Audit Committee.
703 Curtis Street
Middleton, OH 45043
Grover C. Wrenn................................. 55 Chairman and Chief Executive Officer of Better
Director of Laidlaw Environmental since July Health Network, Inc. since June 1996; Chief
1997 Executive Officer of EnSys Environmental Products,
4 Wolfe Street Inc. from April 1995 through December 1996; and
Alexandria, VA 22314 President and Chief Executive Officer of Applied
Bioscience International from 1991 through March
1995. Mr. Wrenn also is a director of Strategic
Diagnostics, Inc. and Pharmakinetics Laboratories,
Inc.
</TABLE>
13
<PAGE> 17
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION OR EMPLOYMENT DURING THE
NAME AND BUSINESS ADDRESS AGE LAST FIVE YEARS, DIRECTORSHIPS OF PUBLIC COMPANIES
------------------------- --- --------------------------------------------------
<S> <C> <C>
Michael J. Bragagnolo........................... 51 Executive Vice President and Chief Operating
Executive Vice President and Chief Operating Officer of Laidlaw Environmental Services, Inc.
Officer of Laidlaw Environmental since May 1997 since May 15, 1997; Executive Vice President and
Laidlaw Environmental Services, Inc. Chief Operating Officer of Laidlaw Environmental
1301 Gervais Street, Suite 300 Services (US), Inc. from January 1997 until May
Columbia, SC 29201 1997; Executive Vice President of United States
Operations of Laidlaw Waste Systems, Inc. from
September 1993 until January 1997; Vice President
of Strategic Analysis and Planning of Laidlaw
Waste Systems, Inc. from December 1991 until
September 1993. Non-U.S. citizen.
Henry H. Taylor................................. 53 Vice President, General Counsel and Secretary of
Vice President, General Counsel and Secretary of Laidlaw Environmental Services, Inc. since May 15,
Laidlaw Environmental since May 1997 1997; Secretary of LES. Acquisition, Inc. since
Laidlaw Environmental Services, Inc. November 12, 1997; Vice President of Legal and
1301 Gervais Street, Suite 300 Regulatory Affairs and Secretary of Laidlaw
Columbia, SC 29201 Environmental Services (US), Inc. September 1995
until May 1997; Vice President of Legal Affairs of
Laidlaw Environmental Services (US), Inc. May 1990
until January 1995.
Paul R. Humphreys............................... 38 Senior Vice President of Finance and Chief
Senior Vice President, Finance and Chief Financial Officer of Laidlaw Environmental
Financial Officer of Laidlaw Environmental since Services, Inc. since May 15, 1997; Senior Vice
May 1997 President and Chief Financial Officer of LES
Laidlaw Environmental Services, Inc. Acquisition, Inc. since November 12, 1997; Vice
1301 Gervais Street, Suite 300 President of Finance for Laidlaw Environmental
Columbia, SC 29201 Services (US), Inc. January 1995 until May 1997;
Manager of Finance for Laidlaw Inc. from 1988
until January 1995. Non-U.S. citizen.
</TABLE>
14
<PAGE> 18
SOLICITATIONS OF PROXIES
BEAR, STEARNS & CO. INC.
The following individuals are the representatives of the Dealer Manager who
may solicit proxies:
Paul A. Berman
Christopher J. Boyle
Barry J. Cohen
Ashar H. Khan
Douglas T. Lake
Anthony J. Magro
Richard M. Osler
Each of the above-named individuals is employed by Bear, Stearns & Co.
Inc., 245 Park Avenue, New York, New York 10167
RAYMOND JAMES & ASSOCIATES, INC.
The following individuals are the representatives of Raymond James who may
solicit proxies:
David E. Thomas, Jr.
- ------------------------------------------------------
J. Davenport Mosby III
- ------------------------------------------------------
R. Ike Ikauniks
- ------------------------------------------------------
15
<PAGE> 19
SCHEDULE II
SHARES HELD BY LAIDLAW ENVIRONMENTAL AND LES ACQUISITION
As of the date hereof, Laidlaw Environmental and its subsidiaries
(including LES Acquisition) hold beneficially 601,100 Shares.
Neither Laidlaw Environmental nor, to the best of its knowledge, any of the
persons listed on Schedule I hereto has (i) any contract, arrangement,
understanding or relationship with any other person with respect to any
securities of Safety-Kleen, 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; (ii) had any contacts or negotiations with Safety-Kleen or its
affiliates concerning a merger, consolidation or acquisition, a tender offer or
other acquisition of securities, an election of directors, or a sale or other
transfer of a material amount of assets, except as described herein; or (iii)
has had any transaction with Safety-Kleen or any of its executive officers,
directors or affiliates that would require disclosure under the rules and
regulations of the Commission applicable to the Laidlaw Environmental Offer
except existing and present business relationships (e.g., providing services to
each other or considering the purchase or sale of discrete assets or operations
or alliances) in the ordinary course of business, none of which are material,
other than the sale of certain assets of a Laidlaw Environmental subsidiary to
Safety-Kleen in February 1996 and the accompanying cooperative services
agreement which is in the process of being terminated.
In the ordinary course of its business, Bear Stearns and Raymond James may
trade the securities of Safety-Kleen for their own accounts and the accounts of
their customers and, accordingly, may at any time hold a long or short position
in such securities. As of the date hereof, Bear Stearns holds a net long
position of 3,718 Shares and Raymond James holds no Shares.
16
<PAGE> 20
SCHEDULE III
OWNERSHIP OF SHARES BY CERTAIN BENEFICIAL OWNERS
AND SAFETY-KLEEN MANAGEMENT
The following table and notes thereto, which, other than information
regarding Laidlaw Environmental, are reproduced from the Safety-Kleen Proxy
Statement for the 1997 Annual Meeting of Shareholders, set forth certain
information with respect to beneficial ownership of Shares as of March 28, 1997
by (a) all directors of Safety-Kleen, (b) the named directors and officers of
Company, including the executive officers of subsidiaries of Safety-Kleen and
(c) all directors and executive officers of Safety-Kleen as a group. An asterisk
indicates ownership of less than one percent of outstanding Shares.
<TABLE>
<CAPTION>
PERCENTAGE OF
NUMBER OF SHARES OUTSTANDING
STOCK(2) BENEFICIALLY OWNED(1) SHARES
-------- --------------------- -------------
<S> <C> <C>
Donald W. Brinckman........................................ 869,156(3) 1.48%
Joseph Chalhoub............................................ 350,683(4) *
David A. Dattilo........................................... 119,972(5) *
Richard T. Farmer.......................................... 42,750(6) *
Russell A. Gwillim......................................... 197,981(7) *
F. Henry Habicht II........................................ 42,226(8) *
Edgar D. Jannotta.......................................... 67,500(6) *
John G. Johnson, Jr........................................ 91,513(9) *
Karl G. Otzen.............................................. 1,480,581(11) 2.54%
Paul D. Schrage............................................ 31,180(6) *
Marcia E. Williams......................................... 8,500(10) *
W. Gordon Wood............................................. 70,805(6) *
</TABLE>
- ---------------
* Denotes less than one percent of shares outstanding.
(1) Under regulations of the Securities and Exchange Commission, persons who
own or have the power to vote or dispose of shares, either alone or
jointly with others, are deemed to be the beneficial owners of such
shares. Such persons are also deemed to be the beneficial owners of shares
beneficially owned by certain close family members.
(2) Shares subject to options exercisable within 60 days of February 26, 1997
are considered outstanding for the purpose of determining the percent of
the class held by the holder of such option, but not for the purpose of
computing the percentage held by others.
(3) Includes 73 shares owned by his wife, 431,091 shares subject to options
exercisable within 60 days of February 26, 1997 and 1,033 shares held in
the Company's 401(k) plan as to which he does not have voting control.
(4) Includes 275,000 shares owned by Breslube Industries, Ltd. of which 100%
is owned by Mr. Chalhoub. Also included are 59 shares owned by his wife,
75 shares owned by his son and 75,549 shares subject to options
exercisable within 60 days of February 26, 1997.
(5) Includes 88,627 shares subject to options exercisable within 60 days of
February 26, 1997.
(6) Includes 30,000 shares subject to options exercisable within 60 days of
February 26, 1997.
(7) Includes 30,223 shares owned by his wife and 30,000 shares subject to
options exercisable within 60 days of February 26, 1997. Mr. Gwillim is
also a co-trustee for 45,827 shares held in an irrevocable trust for which
he has no beneficial ownership; such shares are not included in the table.
(8) Includes 39,712 shares subject to options exercisable within 60 days of
February 26, 1997 and 114 shares held in Safety-Kleen's 401(k) plan as to
which he does not have voting control.
(9) Includes 700 shares owned by his wife, 81,962 shares subject to options
exercisable within 60 days of February 26, 1997 and 332 shares held in
Safety-Kleen's 401(k) plan as to which he does not have voting control.
(10) Includes 7,500 shares subject to options exercisable within 60 days of
February 26, 1997.
17
<PAGE> 21
(11) Karl G. Otzen and Lucy T. Otzen (the "Otzens") are husband and wife. For
the purposes of this table, Karl G. Otzen is deemed to own shares owned by
Lucy T. Otzen, and accordingly such number of shares is shown. In December
1992, the Otzens caused 683,760 of their shares to be contributed to
Circle L Limited Partnership. The general partner which controls the
Partnership is a corporation in which Karl G. Otzen, Lucy T. Otzen, Joan
Emery Lammers and her husband (the "Lammers"). Each owns 25% of the voting
stock and each occupies one of the four positions on the Board of
Directors. Because the Otzens and Lammers share voting power over all of
the shares held by the Partnership, each of them may be deemed to "own"
all shares in the partnership under the criteria governing this table. To
enhance clarity of presentation, however, the shares contributed to the
Partnership by Joan Emery Lammers are shown opposite Karl G. Otzen's name
and also included are 757,721 shares owned by trustees of which the Otzens
are co-trustees, 9,100 shares owned by a trust of which The Northern Trust
Company is trustee and 30,000 shares subject to options exercisable by
Karl G. Otzen within 60 days of February 26, 1997.
18
<PAGE> 22
IMPORTANT
If your shares are registered in your own name, you may mail or fax your
BLUE-STRIPED proxy card (both sides) to Morrow & Co., Inc. at the address or fax
number listed below.
If your shares are held in "street name" -- held by your brokerage firm or
bank -- immediately instruct your broker or bank representative to sign the
BLUE-STRIPED proxy card on your behalf. If you have any questions on voting your
shares, please call.
Morrow & Co., Inc.
909 Third Avenue, 20th Floor
New York, NY 10022
CALL COLLECT (212) 754-8000
CALL TOLL-FREE (800) 662-5200
Fax: (212) 754-8300.
19
<PAGE> 23
APPENDIX
- --------------------------------------------------------------------------------
PROXY THIS PROXY IS SOLICITED BY
LAIDLAW ENVIRONMENTAL SERVICES, INC. AND LES ACQUISITION, INC.
FOR THE SPECIAL MEETING OF SHAREHOLDERS OF
SAFETY-KLEEN CORP.
TO BE HELD PURSUANT TO SECTION 180.1150 OF THE WISCONSIN BUSINESS CORPORATION
LAW
The undersigned hereby appoints Kenneth W. Winger, Henry H. Taylor, Paul R.
Humphreys, and each of them, with full power of substitution, the proxies of the
undersigned to vote all of the outstanding Shares, par value $.10 per share
("Shares"), of Safety-Kleen Corp. ("Safety-Kleen") that the undersigned is
entitled to vote at the Special Meeting of shareholders of Safety-Kleen to be
held on January 9, 1998 pursuant to Section 180.1150 of the Wisconsin Business
Corporation Law (the "Control Share Meeting"), or at any adjournment or
postponement of the Control Share Meeting, on the following matters:
1. Restoration of Full Voting Power of Shares of Safety-Kleen. A resolution of
Safety-Kleen's shareholders authorizing the restoration of full voting power
to all Shares of Safety-Kleen to be acquired by Laidlaw Environmental
Services, Inc. (or one or more direct or indirect subsidiaries of Laidlaw
Environmental Services, Inc.) pursuant to the Laidlaw Environmental Offer (as
described in the Proxy Statement (as defined below) for the Control Share
Meeting), as such Laidlaw Environmental Offer may be amended from time to
time, or otherwise.
[ ] FOR [ ] AGAINST [ ] ABSTAIN
2. Adjournment of Meeting. To initiate and vote for a proposal to adjourn the
Control Share Meeting to solicit additional votes, if necessary, to authorize
the restoration of voting power to all Common Shares to be acquired by
Laidlaw Environmental Services, Inc. (or one or more direct or indirect
subsidiaries of Laidlaw Environmental Services, Inc.) (the "Adjournment
Proposal").
[ ] FOR [ ] AGAINST [ ] ABSTAIN
LAIDLAW ENVIRONMENTAL SERVICES, INC. AND LES ACQUISITION, INC.
RECOMMEND THAT YOU VOTE "FOR" ITEMS 1 AND 2.
The proxies of the undersigned named above are authorized to vote, in their
discretion, upon such other matters as may properly come before the Control
Share Meeting and any adjournment or postponement thereof.
[Proxy Continued On Reverse]
THIS PROXY WHEN PROPERLY EXECUTED WILL BE VOTED AS DIRECTED ON THE REVERSE SIDE.
IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED "FOR" THE RESTORATION OF
VOTING POWER AND "FOR" THE ADJOURNMENT PROPOSAL. THE UNDERSIGNED HEREBY
ACKNOWLEDGES RECEIPT OF THE PROXY STATEMENT OF LAIDLAW ENVIRONMENTAL SERVICES,
INC. AND LES ACQUISITION, INC. DATED DECEMBER 16, 1997 SOLICITING PROXIES FOR
THE CONTROL SHARE MEETING (THE "PROXY STATEMENT").
ALL PREVIOUS PROXIES GIVEN BY THE UNDERSIGNED TO VOTE AT THE CONTROL SHARE
MEETING OR AT ANY ADJOURNMENT OR POSTPONEMENT THEREOF ARE HEREBY REVOKED.
Dated:
-------------------------
-------------------------------
Signature
-------------------------------
Signature if held jointly
Title:
-------------------------
PLEASE SIGN EXACTLY AS NAME APPEARS
HEREON. WHEN SHARES ARE HELD BY JOINT
TENANTS, BOTH SHOULD SIGN. WHEN
SIGNING AS AN ATTORNEY, EXECUTOR,
ADMINISTRATOR, TRUSTEE OR GUARDIAN,
GIVE FULL TITLE AS SUCH. IF A
CORPORATION, SIGN IN FULL CORPORATE
NAME BY PRESIDENT OR OTHER AUTHORIZED
OFFICER. IF A PARTNERSHIP, SIGN IN
PARTNERSHIP NAME BY AUTHORIZED
PERSON.
PLEASE PROMPTLY COMPLETE, SIGN, DATE AND FAX OR MAIL IN THE ENCLOSED ENVELOPE TO
MORROW & CO., INC., 909 THIRD AVENUE, 20TH FLOOR, NEW YORK, NEW YORK 10022, FAX:
(212) 754-8300.
