<PAGE> 1
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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
and
SCHEDULE 13D
Pursuant to Section 13(D)
of the Securities Exchange Act of 1934
----------------
AMBAR, INC.
(Name of Subject Company)
------------------
AI ACQUISITIONS CORP.
AI PARTNERS L.P.
(Bidders)
-----------------
COMMON STOCK, PAR VALUE $.01 PER SHARE
(Title of Class of Securities)
------------------
023162 10 0
(CUSIP Number of Class of Securities)
------------------
AI PARTNERS L.P.
ATTENTION: ROBERT F. SEMMENS
375 PARK AVENUE, SUITE 1705
NEW YORK, NEW YORK 10152
(212) 339-9100
(Name, Address and Telephone Number of Person Authorized to Receive Notices
and Communications on Behalf of Bidders)
with a copy to:
MARK ZVONKOVIC, ESQ.
ANDREWS & KURTH L.L.P.
425 LEXINGTON AVENUE
NEW YORK, NEW YORK 10017
(212) 850-2800
----------------
CALCULATION OF FILING FEE
- --------------------------------------------------------------------------------
Transaction Valuation: $81,207,090* Amount of Filing Fee: $16,242*
- --------------------------------------------------------------------------------
* For purposes of calculating fee only. The amount assumes the purchase of
4,511,505 Shares (as defined herein) at $18.00 per Share in cash. The amount
of the filing fee, calculated in accordance with Rule 0-11(d) of the
Securities Exchange Act of 1934, as amended, equals 1/50 of one percent of
the aggregate of the cash offered for such number of Shares.
/ / Check box if any part of the fee is offset 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:
Form or Registration No.: Date Filed:
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<PAGE> 2
CUSIP No. 023162 10 0 14D-1 Page 2 of__ Pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
AI Acquisitions Corp.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) / /
(b) / /
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCES OF FUNDS
AF
- --------------------------------------------------------------------------------
5 CHECK BOX 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
2,093,835*
- --------------------------------------------------------------------------------
8 CHECK IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CER-
TAIN SHARES / /
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
56.5%*
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
CO
* On July 1, 1996, AI Partners L.P. ("Parent") entered into certain
agreements (collectively, the "Stockholder Agreements") with Randolph M.
Moity, Sr. and Kenneth J. Boutte (collectively, the "Stockholders") pursuant
to which the Stockholders have agreed, among other things, to validly sell
and tender pursuant to the tender offer by AI Acquisitions Corp.
("Purchaser"), a wholly owned subsidiary of Parent, all of the shares
beneficially owned by them (representing an aggregate of approximately 56% of
the Shares outstanding as of May 31, 1996). Pursuant to the Stockholder
Agreements, each of the Stockholders has agreed, and also granted Parent an
irrevocable proxy, to vote or grant a consent or approval in respect of the
Shares subject to the Stockholder Agreements against any competing
transaction including any other merger, or any extraordinary corporate
transaction such as a consolidation, combination or sale of the Company's
assets or any proposal or transaction that would in any manner impede,
frustrate, prevent or nullify the Offer to Purchase (as defined below) or the
transactions contemplated by the Agreement and Plan of Merger dated July 1,
1996 among Parent, Purchaser and AMBAR, Inc. The Stockholder Agreements are
described more fully in Section 11 of the Offer to Purchase dated July 9,
1996 of Parent and the Purchaser (the "Offer to Purchase").
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<PAGE> 3
CUSIP No. 023162 10 0 14D-1 Page 3 of__ Pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
AI Partners L.P.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) / /
(b) / /
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCES OF FUNDS
AF
- --------------------------------------------------------------------------------
5 CHECK BOX 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
2,093,835*
- --------------------------------------------------------------------------------
8 CHECK IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CER-
TAIN SHARES / /
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
56.5%*
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
PN
-3-
<PAGE> 4
CUSIP No. 023162 10 0 14D-1 Page 4 of__ Pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
AI-GP, L.L.C.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) / /
(b) / /
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCES OF FUNDS
AF
- --------------------------------------------------------------------------------
5 CHECK BOX 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
2,093,835*
- --------------------------------------------------------------------------------
8 CHECK IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CER-
TAIN SHARES / /
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
56.5%*
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
OO
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<PAGE> 5
CUSIP No. 023162 10 0 14D-1 Page 5 of__ Pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
ENERGY FUND GP, 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 BOX 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
2,093,835*
- --------------------------------------------------------------------------------
8 CHECK IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CER-
TAIN SHARES / /
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
56.5%*
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
CO
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<PAGE> 6
CUSIP No. 023162 10 0 14D-1 Page 6 of __Pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
THE BEACON GROUP HOLDINGS, L.L.C.
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) / /
(b) / /
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCES OF FUNDS
AF
- --------------------------------------------------------------------------------
5 CHECK BOX 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
2,093,835*
- --------------------------------------------------------------------------------
8 CHECK IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CER-
TAIN SHARES / /
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
56.5%*
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
OO
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<PAGE> 7
CUSIP No. 023162 10 0 14D-1 Page 7 of __Pages
- --------------------------------------------------------------------------------
1 NAME OF REPORTING PERSONS
S.S. OR I.R.S. IDENTIFICATION NO. OF ABOVE PERSON
THE BEACON GROUP
- --------------------------------------------------------------------------------
2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(a) / /
(b) / /
- --------------------------------------------------------------------------------
3 SEC USE ONLY
- --------------------------------------------------------------------------------
4 SOURCES OF FUNDS
AF
- --------------------------------------------------------------------------------
5 CHECK BOX 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
2,093,835*
- --------------------------------------------------------------------------------
8 CHECK IF THE AGGREGATE AMOUNT IN ROW (7) EXCLUDES CER-
TAIN SHARES / /
- --------------------------------------------------------------------------------
9 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (7)
56.5%*
- --------------------------------------------------------------------------------
10 TYPE OF REPORTING PERSON
PN
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<PAGE> 8
This Tender Offer Statement on Schedule 14D-1 (the "Schedule 14D-1")
relates to the offer by AI Acquisitions Corp., a Delaware corporation (the
"Purchaser") and a wholly owned subsidiary of AI Partners L.P., a Delaware
limited partnership ("Parent"), to purchase all outstanding shares of common
stock, par value $.01 per share (the "Shares"), of AMBAR, Inc., a Delaware
corporation (the "Company"), upon the terms and subject to the conditions set
forth in the Offer to Purchase, dated July 9, 1996 (the "Offer to Purchase"),
and in the related Letter of Transmittal (which together constitute the
"Offer"), which are annexed to and filed with this Statement as Exhibits (a)(1)
and (a)(2), respectively.
ITEM 1--SECURITY AND SUBJECT COMPANY
(a) The name of the subject company is AMBAR, Inc., a Delaware corporation.
The principal executive offices of the Company are located at the AMBAR
Building, 221 Rue de Jean, Suite 300, Lafayette, Louisiana 70508.
(b) The class of equity securities to which this Schedule 14D-1 relates is
the common stock, par value $.01 per share, of the Company. The information set
forth in "Introduction" of the Offer to Purchase is incorporated herein by
reference.
(c) The information 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) and (g) This Schedule 14D-1 is being filed by the Purchaser, Parent
and their affiliates. The information set forth in "Introduction," Section 8
("Certain Information Concerning The Beacon Group, Parent and the Purchaser")
and in Schedule I ("Certain Information Concerning The Beacon Group, Parent and
the Purchaser") of the Offer to Purchase is incorporated herein by reference.
(e) and (f) During the last five years, neither the Purchaser nor Parent
nor, to the best of their knowledge, The Beacon Group or any of the persons
listed in Schedule I ("Certain Information Concerning The Beacon Group, Parent
and the Purchaser") to the Offer to Purchase (i) has been convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors) or
(ii) was a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction and as a result of such proceeding was or is subject to a
judgment, decree or final order enjoining further violations of, or prohibiting
activities subject to, federal or state securities laws or finding any
violations of such laws.
ITEM 3--PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH THE SUBJECT COMPANY
(a)-(b) The information set forth in "Introduction," Section 8 ("Certain
Information Concerning The Beacon Group, Parent and the Purchaser"), Section 10
("Background of the Offer; Past Contacts, Transactions or Negotiations with the
Company") and Section 11 ("Purpose of the Offer; the Merger; the Merger
Agreement; the Stockholder Agreements; Employment Agreement; Plans for the
Company") of the Offer to Purchase is incorporated herein by reference.
ITEM 4--SOURCE AND AMOUNT OF FUNDS OR OTHER CONSIDERATION
(a)-(b) The information set forth in Section 9 ("Source and Amount of
Funds") of the Offer to Purchase is incorporated herein by reference.
(c) Not applicable.
-8-
<PAGE> 9
ITEM 5--PURPOSE OF THE TENDER OFFER AND PLANS OR PROPOSALS OF THE BIDDER
(a)-(e) The information set forth in "Introduction," Section 6 ("Price
Range of Shares; Dividends"), Section 10 ("Background of the Offer; Past
Contacts, Transactions or Negotiations with the Company"), Section 11 ("Purpose
of the Offer; the Merger; the Merger Agreement; the Stockholder Agreements;
Employment Agreement; Plans for the Company") and Section 13 ("Dividends and
Distributions") of the Offer to Purchase is incorporated herein by reference.
(f)-(g) The information set forth in Section 12 ("Effect of the Offer on
the Market for Shares; Stock Exchange Listing; Registration Under the Exchange
Act") of the Offer to Purchase is incorporated herein by reference.
ITEM 6--INTEREST IN SECURITIES OF THE SUBJECT COMPANY
(a)-(b) The information set forth in "Introduction," Section 8 ("Certain
Information Concerning The Beacon Group, Parent and the Purchaser"), Section 10
("Background of the Offer; Past Contacts, Transactions or Negotiations with the
Company") and Section 11 ("Purpose of the Offer; the Merger; the Merger
Agreement; the Stockholder Agreements; Employment Agreement; Plans for the
Company") 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 "Introduction," Section 8 ("Certain
Information Concerning The Beacon Group, Parent and the Purchaser"), Section 10
("Background of the Offer; Past Contacts, Transactions or Negotiations with the
Company") and Section 11 ("Purpose of the Offer; the Merger; the Merger
Agreement; the Stockholder Agreements; Employment Agreement; Plans for the
Company") of the Offer to Purchase is incorporated herein by reference.
ITEM 8--PERSONS RETAINED, EMPLOYED OR TO BE COMPENSATED
The information set forth in "Introduction," Section II ("Purpose of the
Offer; the Merger; the Merger Agreement; the Stockholder Agreements; the
Employment Agreement; Plans for the Company") 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 The
Beacon Group, Parent and the Purchaser") of the Offer to Purchase is
incorporated herein by reference.
ITEM 10--ADDITIONAL INFORMATION
(a) The information set forth in "Introduction," Section 8 ("Certain
Information Concerning The Beacon Group, Parent and the Purchaser"), Section 10
("Background of the Offer; Past Contacts, Transactions or Negotiations with the
Company") and Section 11 ("Purpose of the Offer; the Merger; the Merger
Agreement; the Stockholder Agreements; Employment Agreement; Plans for the
Company") of the Offer to Purchase is incorporated herein by reference.
-9-
<PAGE> 10
(b)-(c) The information set forth in Section 11 ("Purpose of the Offer; the
Merger; the Merger Agreement; the Stockholder Agreements; Employment Agreement;
Plans for the Company") and Section 15 ("Certain Legal Matters; Required
Regulatory Approvals") of the Offer to Purchase is incorporated herein by
reference.
(d) The information set forth in Section 12 ("Effect of the Offer on the
Market for Shares; Stock Exchange Listing; Registration Under the Exchange Act")
of the Offer to Purchase is incorporated herein by reference.
(e) Not applicable.
(f) The information set forth in the Offer to Purchase and the related
Letter of Transmittal, copies of which are attached hereto as Exhibits (a)(1)
and (a)(2), respectively, is incorporated herein by reference in its entirety.
ITEM 11--MATERIAL TO BE FILED AS EXHIBITS
(a)(1) Offer to Purchase, dated July 9, 1996.
(a)(2) Letter of Transmittal.
(a)(3) Notice of Guaranteed Delivery.
(a)(4) Letter from Georgeson & Company Inc. to Brokers, Dealers,
Commercial Banks, Trust Companies and Other Nominees, dated
July 9, 1996.
(a)(5) Letter to Clients for use by Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees.
(a)(6) IRS Guidelines for Certification of Taxpayer Identification Number
on Substitute Form W-9.
(a)(7) Summary Advertisement, dated July 9, 1996.
(a)(8) Text of Press Release issued on July 2, 1996.
(a)(9) Text of Press Release issued on July 9, 1996.
(c)(1) Agreement and Plan of Merger, dated as of July 1, 1996, among
AMBAR, Inc., AI Partners L.P. and AI Acquisitions Corp.
(c)(2) Stockholder Agreement, dated as of July 1, 1996, between AI
Partners L.P. and Randolph M. Moity, Sr.
(c)(3) Stockholder Agreement, dated as of July 1, 1996, between AI
Partners L.P. and Kenneth J. Boutte.
(c)(4) Employment Agreement, dated July 1, 1996, between AMBAR, Inc. and
Randolph M. Moity, Sr.
(c)(5) Confidentiality Agreement, dated April 23, 1996.
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
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<PAGE> 11
SIGNATURE
After due inquiry and to the best of its knowledge and belief, the
undersigned certifies that the information set forth in this statement is true,
complete and correct.
Dated: July 9, 1996
AI ACQUISITIONS CORP.
By: /s/ Robert F. Semmens
............................................
Name: Robert F. Semmens
Title: Managing Director
AI PARTNERS L.P.
By AI-GP L.L.C., general partner
By Energy Fund GP, Inc., member
By: /s/ Robert F. Semmens
............................................
Name: Robert F. Semmens
Title: Managing Director
AI-GP, L.L.C.
By Energy Fund GP, Inc., member
By: /s/ Robert F. Semmens
............................................
Name: Robert F. Semmens
Title: Managing Director
ENERGY FUND GP, INC.
By: /s/ Robert F. Semmens
............................................
Name: Robert F. Semmens
Title: Managing Director
THE BEACON GROUP HOLDINGS, L.L.C.
By The Beacon Group, member
By: /s/ Robert F. Semmens
............................................
Name: Robert F. Semmens
Title: Partner
THE BEACON GROUP
By: /s/ Robert F. Semmens
............................................
Name: Robert F. Semmens
Title: Partner
-11-
<PAGE> 12
EXHIBIT INDEX
Exhibit Exhibit Name
- ------- ------------
(a)(1) Offer to Purchase, dated July 9, 1996.
(a)(2) Letter of Transmittal.
(a)(3) Notice of Guaranteed Delivery.
(a)(4) Letter from Georgeson & Company, Inc. to Brokers, Dealers, Commercial
Banks, Trust Companies and Other Nominees, dated July 9, 1996.
(a)(5) Letter to Clients for use by Brokers, Dealers, Commercial Banks, Trust
Companies and Other Nominees.
(a)(6) IRS Guidelines for Certification of Taxpayer Identification Number on
Substitute Form W-9.
(a)(7) Summary Advertisement, dated July 9, 1996.
(a)(8) Text of Press Release issued on July 2, 1996.
(a)(9) Text of Press Release issued on July 9, 1996.
(c)(1) Agreement and Plan of Merger, dated July 1, 1996 among AMBAR, Inc.,
AI Partners L.P. and AI Acquisitions Corp.
(c)(2) Stockholder Agreement, dated as of July 1, 1996, between AI Partners
L.P. and Randolph M. Moity, Sr.
(c)(3) Stockholder Agreement, dated as of July 1, 1996, between AI Partners
L.P. and Kenneth J. Boutte.
(c)(4) Employment Agreement, dated July 1, 1996, between AMBAR, Inc. and
Randolph M. Moity, Sr.
(c)(5) Confidentiality Agreement, dated April 23, 1996.
(d) Not applicable.
(e) Not applicable.
(f) Not applicable.
<PAGE> 1
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
AMBAR, INC.
AT
$18.00 NET PER SHARE
BY
AI ACQUISITIONS CORP.,
A CORPORATION FORMED BY
THE BEACON GROUP
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON MONDAY, AUGUST 5, 1996, UNLESS THE OFFER IS EXTENDED.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER OF
SHARES THAT REPRESENTS NOT LESS THAN 90% OF THE OUTSTANDING SHARES OF AMBAR,
INC. (THE "COMPANY") ON A FULLY DILUTED BASIS. THE OFFER IS ALSO SUBJECT TO
OTHER TERMS AND CONDITIONS CONTAINED IN THIS OFFER TO PURCHASE. SEE SECTIONS 1,
14 AND 15.
THE BOARD OF DIRECTORS OF THE COMPANY HAS APPROVED THE OFFER AND THE MERGER
(AS DEFINED BELOW) AND DETERMINED, BASED UPON, AMONG OTHER THINGS, THE UNANIMOUS
RECOMMENDATION OF A DULY APPOINTED INDEPENDENT COMMITTEE OF THE BOARD, THAT THE
TERMS OF THE OFFER AND THE MERGER ARE FAIR TO, AND IN THE BEST INTERESTS OF, THE
COMPANY AND ITS STOCKHOLDERS, AND RECOMMENDS THAT HOLDERS OF SHARES OF THE
COMPANY'S COMMON STOCK ACCEPT THE OFFER AND TENDER THEIR SHARES PURSUANT TO THE
OFFER.
IMPORTANT
Any stockholder desiring to tender all or any portion of such stockholder's
Shares should either (a) complete and sign the enclosed Letter of Transmittal
(or a facsimile copy thereof) in accordance with the instructions in the Letter
of Transmittal and mail or deliver it together with the certificate(s)
representing tendered Shares, and any other required documents, to the
Depositary or tender such Shares pursuant to the procedures for book-entry
transfer set forth in Section 3 or (b) request such stockholder's broker,
dealer, commercial bank, trust company or other nominee to effect the
transaction for such stockholder. A stockholder whose Shares are registered in
the name of a broker, dealer, commercial bank, trust company or other nominee
must contact such broker, dealer, commercial bank, trust company or other
nominee if such stockholder desires to tender such Shares.
Any stockholder who desires to tender Shares and whose certificates
representing such Shares are not immediately available or who cannot comply with
the procedures 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 at its address and telephone number set forth on the back cover of this
Offer to Purchase. Additional copies of this Offer to Purchase, the Letter of
Transmittal and other tender offer materials may be obtained from the
Information Agent or from brokers, dealers, commercial banks and trust
companies.
July 9, 1996
<PAGE> 2
TABLE OF CONTENTS
<TABLE>
<CAPTION>
PAGE
----
<S> <C> <C>
INTRODUCTION.......................................................................... 1
THE TENDER OFFER
1. Terms of the Offer.............................................................. 3
2. Acceptance for Payment and Payment for Shares................................... 4
3. Procedures for Tendering Shares................................................. 5
4. Withdrawal Rights............................................................... 7
5. Certain Federal Income Tax Consequences......................................... 8
6. Price Range of Shares; Dividends................................................ 8
7. Certain Information Concerning the Company...................................... 9
8. Certain Information Concerning The Beacon Group,
Parent and the Purchaser........................................................ 11
9. Source and Amount of Funds...................................................... 11
10. Background of the Offer; Past Contacts, Transactions or
Negotiations with the Company................................................... 12
11. Purpose of the Offer; the Merger; the Merger Agreement; Stockholder Agreements;
Employment Agreement; Plans for the Company..................................... 13
12. Effect of the Offer on the Market for Shares; Stock Exchange Listing;
Registration Under the Exchange Act............................................. 22
13. Dividends and Distributions..................................................... 23
14. Conditions to the Offer......................................................... 24
15. Certain Legal Matters; Required Regulatory Approvals............................ 25
16. Fees and Expenses............................................................... 27
17. Miscellaneous................................................................... 27
Schedule I Certain Information Concerning The Beacon Group,
Parent and the Purchaser.............................................. I-1
</TABLE>
i
<PAGE> 3
To the Holders of Shares of Common Stock of
AMBAR, Inc.:
INTRODUCTION
AI Acquisitions Corp., a Delaware corporation (the "Purchaser") and a
wholly owned subsidiary of AI Partners L.P., a Delaware limited partnership
("Parent"), hereby offers to purchase all outstanding shares of common stock,
par value $0.01 per share (the "Shares"), of AMBAR, Inc., a Delaware corporation
(the "Company"), at $18.00 per Share, net to the seller in cash, without
interest thereon, upon the terms and subject to the conditions set forth in this
Offer to Purchase, the Merger Agreement (as defined below) and in the related
Letter of Transmittal (which, as amended from time to time, together with the
Offer to Purchase constitute the "Offer"). The Purchaser and Parent have been
organized by The Beacon Group, a New York general partnership, for purposes of
the transactions described herein.
Tendering stockholders will not be obligated to pay brokerage commissions
or, except as set forth in Instruction 6 of the Letter of Transmittal, transfer
taxes on the purchase of Shares by the Purchaser pursuant to the Offer. However,
any tendering stockholder or other payee who fails to complete and sign the
Substitute Form W-9 that is included in the Letter of Transmittal may be subject
to a required backup federal income tax withholding of 31% of the gross proceeds
payable to such stockholder or other payee pursuant to the Offer. See Section 3.
The Purchaser will pay all charges and expenses of Georgeson & Company Inc.,
which is acting as the Information Agent (the "Information Agent"), and The
First National Bank of Boston, which is acting as the Depositary (the
"Depositary"), incurred in connection with the Offer. See Section 16.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THERE BEING VALIDLY
TENDERED AND NOT WITHDRAWN PRIOR TO THE EXPIRATION OF THE OFFER A NUMBER OF
SHARES THAT REPRESENTS NOT LESS THAN 90% OF THE OUTSTANDING SHARES ON A FULLY
DILUTED BASIS (THE "MINIMUM SHARE CONDITION"). THE OFFER IS ALSO SUBJECT TO
OTHER TERMS AND CONDITIONS CONTAINED IN THIS OFFER TO PURCHASE. SEE SECTIONS 1,
14 AND 15.
THE BOARD OF DIRECTORS OF THE COMPANY HAS APPROVED THE OFFER AND THE MERGER
(AS DEFINED BELOW) AND DETERMINED, BASED UPON, AMONG OTHER THINGS, THE UNANIMOUS
RECOMMENDATION OF A DULY APPOINTED INDEPENDENT COMMITTEE OF THE BOARD (THE
"INDEPENDENT COMMITTEE"), THAT THE TERMS OF THE OFFER AND THE MERGER ARE FAIR
TO, AND IN THE BEST INTERESTS OF, THE COMPANY AND ITS STOCKHOLDERS AND
RECOMMENDS THAT HOLDERS OF SHARES ACCEPT THE OFFER AND TENDER THEIR SHARES
PURSUANT TO THE OFFER.
THE INDEPENDENT COMMITTEE OF THE BOARD OF DIRECTORS OF THE COMPANY HAS
RECEIVED THE OPINION OF RAYMOND JAMES & ASSOCIATES, INC. ("RAYMOND JAMES"), THE
COMPANY'S FINANCIAL ADVISOR, THAT THE CONSIDERATION TO BE RECEIVED BY THE
COMPANY'S STOCKHOLDERS PURSUANT TO THE OFFER AND THE MERGER IS FAIR TO SUCH
HOLDERS FROM A FINANCIAL POINT OF VIEW.
The Offer is being made pursuant to the Agreement and Plan of Merger, dated
as of July 1, 1996 (the "Merger Agreement"), among the Company, Parent and the
Purchaser. The Merger Agreement provides, among other things, that as soon as
practicable following the satisfaction or waiver, if permissible, of the
conditions set forth in the Merger Agreement and described herein, the Purchaser
will be merged with and into the Company (the "Merger"), with the result that
all of the outstanding common stock of the Company will be beneficially owned by
Parent. At the Effective Time (as defined in the Merger Agreement) of the
Merger, each Share issued and outstanding immediately prior to the Effective
Time (other than Shares owned by the Purchaser or any affiliate of the Purchaser
or held in the treasury of the Company or by any subsidiary of the Company, all
of which will be cancelled and no payment shall be made with respect thereto,
and other than Dissenting Shares (as defined below under "Dissenters' Rights"))
shall, by virtue of the Merger and without any action on the part of the holder
thereof, be converted into the right to receive $18.00 net to the
<PAGE> 4
holder in cash, or any higher price that may be paid pursuant to the Offer,
payable to the holder thereof, without interest thereon, upon surrender of the
certificate representing such Share.
All options to purchase Common Stock (the "Options") pursuant to the
Company's 1991 Employees' Incentive Compensation Program or the Company's 1994
Non-Employee Directors' Incentive Compensation Program (collectively, the "Stock
Option Plans") shall, in accordance with such Plans, become exercisable upon
consummation of the Merger and the Shares received upon such exercise shall be
convertible in the Merger into cash in an amount equal to the Offer Price, less
required withholding taxes. The Merger Agreement provides that the Company will
take reasonable actions to effect the provisions of the Merger Agreement related
to the Options, including using reasonable efforts to obtain the written
acknowledgment of each holder of Options that the payment of such amount will
fully discharge the Company's obligations with respect thereto. Subsequent to
the Effective Time, Options will no longer be issued under the Company's Stock
Option Plans.
Concurrently with the execution of the Merger Agreement, Parent entered
into Stockholder Agreements, dated as of July 1, 1996 (the "Stockholder
Agreements"), with certain stockholders of the Company (the "Principal
Stockholders") who hold, in the aggregate, approximately 56% of the outstanding
Shares. Pursuant to the Stockholder Agreements, each Principal Stockholder has
agreed to sell to the Purchaser all Shares which are beneficially owned by such
individual at a price per Share equal to the price paid for the Shares in the
Offer, provided that such obligation to sell and the obligation to purchase is
subject to the Purchaser having accepted Shares for payment in the Offer. The
Principal Stockholders also agreed to vote their Shares against any competing
transaction, including a merger (other than the Merger), or any other
extraordinary corporate transaction such as a consolidation, combination or sale
of the Company's assets or any proposal or transaction that would in any manner
impede, frustrate, prevent or nullify the Offer or the Merger. In addition, each
of the Principal Stockholders granted Parent an irrevocable proxy to vote or
grant a consent or approval in respect of the Shares then owned by such
Principal Stockholder as set forth in the preceding sentence. One of the
Principal Stockholders also granted the Purchaser the right to purchase up to
100,000 of his Shares by delivery of a promissory note, as described under the
heading "Stockholder Agreements" in Section 11. See Section 11.
The Purchaser has been advised by the Company that, to the Company's
knowledge, to the extent permitted by applicable securities laws, rules or
regulations, all of the Company's directors and executive officers currently
intend to tender all Shares owned by them pursuant to the Offer.
Parent has asked Mr. Randolph M. Moity, Sr., the Chairman, Chief Executive
Officer and President of the Company, who is also a Principal Stockholder
holding approximately 50% of the Shares, to continue his position as Chairman,
Chief Executive Officer and President of the Company until such time as a
suitable replacement may be found and thereafter to resign his position as
Chairman, Chief Executive Officer and President at the request of the Company.
See Section 11.
According to the Company, as of May 31, 1996, there were 3,701,505 Shares
outstanding, 400,000 Shares reserved for issuance upon exercise of then
outstanding Options to acquire Shares under the Company's Incentive Plan and
Directors' Plan, 300,000 Shares reserved for issuance under the Company's 401(k)
Plan and 110,000 warrants outstanding, each representing the right to purchase
from the Company, on or prior to December 12, 1996, one Share at a price of
$9.4875 per Share.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION WHICH STOCKHOLDERS SHOULD READ CAREFULLY BEFORE MAKING ANY
DECISION WITH RESPECT TO THE OFFER.
2
<PAGE> 5
THE TENDER OFFER
1. TERMS OF THE OFFER.
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 extension or
amendment), the Purchaser will accept for payment and pay for all Shares which
are validly tendered prior to the Expiration Date and not withdrawn in
accordance with Section 4. The term "Expiration Date" means 12:00 midnight, New
York City time, on Monday, August 5, 1996 unless and until the Purchaser
(subject to the terms of the Merger Agreement) shall have extended the period of
time during which the Offer is open, in which event the term "Expiration Date"
shall mean the latest time and date at which the Offer, as so extended by the
Purchaser, shall expire.
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, THE SATISFACTION OF THE
MINIMUM SHARE CONDITION. The "Minimum Share Condition" is the condition to the
Offer that the number of Shares being validly tendered and not withdrawn prior
to the Expiration Date represents not less than 90% of the Shares outstanding on
a Fully Diluted Basis. "Fully Diluted Basis" means the number of Shares
outstanding as of the close of business on May 31, 1996, increased by the number
of Shares (i) issued between such date and the Expiration Date, and (ii)
issuable pursuant to the exercise of rights to purchase Shares or upon
conversion or exchange of other securities; reduced, however, by the number (if
any) of Options and other rights exercised as described in the Merger Agreement.
See Section 14 which sets forth the conditions to the Offer. If any condition to
the Purchaser's obligation to purchase Shares under the Offer is not satisfied
prior to the Expiration Date, the Purchaser reserves the right (but is not
obligated) to (i) decline to purchase any or all of the Shares tendered and
terminate the Offer, and return all tendered Shares to tendering stockholders,
(ii) waive such unsatisfied condition, subject to the terms of the Merger
Agreement and to compliance with applicable rules and regulations of the
Securities and Exchange Commission (the "Commission"), and purchase all Shares
validly tendered, (iii) extend the Offer and, subject to the right of
stockholders to withdraw Shares as provided in Section 4, retain the Shares
which have been tendered during the period or periods for which the Offer is
extended or (iv) subject to the terms of the Merger Agreement, amend the Offer.
See Sections 11 and 14.
The Merger Agreement provides that neither Parent nor the Purchaser will,
without the prior written consent of the Board of Directors of the Company
(excluding any designee of the Purchaser), decrease the consideration, or change
the form of consideration, payable in the Offer, decrease the number of Shares
sought pursuant to the Offer, change the conditions to the Offer, impose
additional conditions to the Offer, change the Expiration Date of the Offer or
amend any term of the Offer in any manner adverse to holders of the Shares.
Subject to the foregoing, the Purchaser expressly reserves the right, at any
time or from time to time, subject to the terms of the Merger Agreement and
regardless of whether or not any of the events set forth in Section 14 shall
have occurred or shall have been determined by the Purchaser to have occurred,
(i) 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 (ii) to amend the
Offer in any respect by giving oral or written notice of such amendment to the
Depositary. The rights reserved by the Purchaser in this paragraph are in
addition to the Purchaser's rights to terminate the Offer described in Section
14. There can be no assurance, however, that the Purchaser will exercise its
rights to extend the Offer. Any extension, amendment or termination will be
followed as promptly as practicable by public announcement thereof, the
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 in accordance with the announcement requirements of Rule
14d-4(c) under the Securities Exchange Act of 1934, as amended (the "Exchange
Act"). Without limiting the obligation of the Purchaser under such Rule or the
manner in which the Purchaser may choose to make any public announcement, the
Purchaser currently intends to make announcements by issuing a release to the
Dow Jones News Service.
If the Purchaser extends the Offer, or if the Purchaser (whether before or
after its acceptance for payment of Shares) is delayed in its purchase of or
payment for Shares or is unable to pay for Shares pursuant to the Offer for any
reason, then, without prejudice to the Purchaser's rights under the Offer, the
Depositary may retain tendered Shares on behalf of the Purchaser, and such
Shares may not be withdrawn except to the
3
<PAGE> 6
extent tendering stockholders are entitled to withdrawal rights as described in
Section 4. However, the ability of the Purchaser to delay the payment for Shares
which the Purchaser has accepted for payment is limited by Rule 14e-1(c) under
the Exchange Act, which requires that a bidder pay the consideration offered or
return the securities deposited by or on behalf of holders of securities
promptly after the termination or withdrawal of the Offer.
If the Purchaser makes a material change in the terms of the Offer or the
information concerning the Offer or waives a material condition of the Offer,
the Purchaser will disseminate additional tender offer materials and extend the
Offer to the extent required by Rules 14d-4(c), 14d-6(d) and 14e-1 under the
Exchange Act. The minimum period during which the Offer must remain open
following material changes in the terms of the Offer or information concerning
the Offer, other than a change in price or a change in percentage of securities
sought, will depend upon the facts and circumstances, including the relative
materiality of the terms or information. With respect to a change in price or a
change in percentage of securities sought, a minimum period of ten business days
is legally required to allow for adequate dissemination to stockholders and
investor response. If, prior to the Expiration Date, the Purchaser should decide
to increase the price per Share being offered in the Offer, such increase will
be applicable to all stockholders whose Shares are accepted for payment pursuant
to the Offer. As used in this Offer to Purchase, "business day" has the meaning
set forth in Rule 14d-1 under the Exchange Act.
The Company has provided to the Purchaser the Company's stockholder list
and security position listings for the purpose of disseminating the Offer to
holders of Shares. This Offer to Purchase and the related Letter of Transmittal
and other relevant materials will be mailed to record holders of Shares and
furnished to brokers, dealers, commercial banks, trust companies and similar
persons whose names, or the names of whose nominees, appear on the stockholder
list or, if applicable, who are listed as participants in a clearing agency's
security position listing, for subsequent transmittal to beneficial owners of
Shares.
2. ACCEPTANCE FOR PAYMENT AND PAYMENT FOR SHARES.
Assuming the prior satisfaction or waiver of the conditions to the Offer
(including, if the Offer is extended or amended, the terms and conditions of any
extension or amendment), the Purchaser shall accept for payment and pay for all
Shares validly tendered prior to the Expiration Date (and not properly withdrawn
in accordance with Section 4) as soon as legally permissible after the
commencement of the Offer after the later to occur of (i) the Expiration Date
and (ii) the satisfaction or waiver of the conditions set forth in Section 14.
Any determination concerning the satisfaction of such terms and conditions shall
be within the sole discretion of the Purchaser. See Section 14. The Purchaser
expressly reserves the right to delay acceptance for payment of, or, subject to
Rule 14e-1(c) under the Exchange Act, payment for, Shares in order to comply, in
whole or in part, with any applicable law. See Sections 14 and 15.
In all cases, payment for Shares purchased pursuant to the Offer will be
made only after timely receipt by the Depositary of (i) the certificates
evidencing such Shares or timely confirmation of book-entry transfer (a
"Book-Entry Confirmation") of such Shares, if such procedure is available, into
the Depositary's account at The Depository Trust Company, the Midwest Securities
Trust Company or the Philadelphia Depository Trust Company (each, a "Book-Entry
Transfer Facility") pursuant to the procedures set forth in Section 3, (ii) a
properly completed and duly executed Letter of Transmittal (or facsimile
thereof), or an Agent's Message (as defined below) in connection with a
book-entry transfer, and (iii) any other documents required by the Letter of
Transmittal.
The term "Agent's Message" means a message, 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 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 such participant.
For purposes of the Offer, the Purchaser will be deemed to have accepted
for payment (and thereby purchased) tendered Shares validly tendered and not
withdrawn, if, as and when the Purchaser gives oral or
4
<PAGE> 7
written notice to the Depositary of the Purchaser's acceptance of such Shares
for payment pursuant to the Offer. In all cases, payment for Shares purchased
pursuant to the Offer will be made by deposit of the purchase price with the
Depositary, which will act as agent for tendering stockholders for the purpose
of receiving payment from the Purchaser and transmitting payment to tendering
stockholders. Under no circumstances will interest on the purchase price of the
Shares be paid by the Purchaser.
If any tendered Shares are not accepted for payment for any reason pursuant
to the terms and conditions of the Offer, or if certificates submitted represent
more Shares than are tendered, certificates for such Shares not purchased or
tendered will be returned, without expense to the tendering stockholder (or, in
the case of Shares tendered by book-entry transfer into the Depositary's account
at a Book-Entry Transfer Facility pursuant to the procedures set forth in
Section 3, such Shares will be credited to an account maintained at such
Book-Entry Transfer Facility), as promptly as practicable after the expiration,
termination or withdrawal of the Offer.
3. PROCEDURES FOR TENDERING SHARES.
Valid Tender of Shares. For Shares to be validly tendered pursuant to the
Offer, a properly completed and duly executed Letter of Transmittal or facsimile
thereof, with any required signature guarantees, or an Agent's Message in
connection with a book-entry delivery of Shares, and any other required
documents, must be received by the Depositary at one of its addresses set forth
on the back cover of this Offer to Purchase prior to the Expiration Date. In
addition, either (i) the certificates evidencing tendered Shares must be
received by the Depositary along with the Letter of Transmittal, (ii) Shares
must be tendered pursuant to the procedures for book-entry transfer described
below and a Book-Entry Confirmation must be received by the Depositary, in each
case prior to the Expiration Date, or (iii) the tendering stockholder must
comply with the guaranteed delivery procedures described below.
THE METHOD OF DELIVERY OF SHARES, THE LETTER OF TRANSMITTAL (OR A MANUALLY
SIGNED FACSIMILE THEREOF) AND ANY OTHER REQUIRED DOCUMENTS, INCLUDING DELIVERY
THROUGH A BOOK-ENTRY TRANSFER FACILITY, IS AT THE OPTION AND RISK OF THE
TENDERING STOCKHOLDER. 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.
Book-Entry Transfer. The Depositary will establish an account with respect
to the Shares at each Book-Entry Transfer Facility for purposes of the Offer
within two business days after the date of this Offer to Purchase. Any financial
institution that is a participant in any of the Book-Entry Transfer Facilities'
systems may make book-entry delivery of Shares by causing a Book-Entry Transfer
Facility to transfer such Shares into the Depositary's account at a Book-Entry
Transfer Facility in accordance with such Book-Entry Transfer Facility's
procedures for transfer. However, although delivery of Shares may be effected
through book-entry transfer at a Book-Entry Transfer Facility, the Letter of
Transmittal or facsimile thereof, properly completed and duly executed, with any
required signature guarantees, or an Agent's Message in connection with a book-
entry delivery of Shares, and any other required documents, must, in any case,
be transmitted to and received by the Depositary at one of its addresses set
forth on the back cover of this Offer to Purchase prior to the Expiration Date
or the tendering stockholder must comply with the guaranteed delivery procedures
described below. DELIVERY OF DOCUMENTS TO A BOOK-ENTRY TRANSFER FACILITY IN
ACCORDANCE WITH THE BOOK-ENTRY TRANSFER FACILITY'S PROCEDURES DOES NOT
CONSTITUTE DELIVERY TO THE DEPOSITARY.
Signature Guarantees. Signatures on all Letters of Transmittal must be
guaranteed by a member firm of a registered national securities exchange, a
member of the National Association of Securities Dealers, Inc. ("NASD") or a
commercial bank or trust company having an office or correspondent in the United
States (each of the foregoing being referred to as an "Eligible Institution"),
except in cases where Shares are tendered (i) by a registered holder of Shares
who has not completed either the box entitled "Special Delivery Instructions" or
the box entitled "Special Payment Instructions" on the Letter of Transmittal, or
(ii) for the account of an Eligible Institution. See Instruction 1 of the Letter
of Transmittal.
If a certificate is 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 not accepted for payment or not tendered are to be returned to
5
<PAGE> 8
a person other than the registered holder, 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 owner 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. If a stockholder desires to tender Shares pursuant to
the Offer and such stockholder's certificates for Shares are not immediately
available or time will not permit all required documents to reach the Depositary
prior to the Expiration Date, or the procedure for book-entry transfer cannot be
completed on a timely basis, such Shares may nevertheless be tendered if all the
following conditions are satisfied:
(i) the tender is made by or through an Eligible Institution;
(ii) a properly completed and duly executed Notice of Guaranteed
Delivery, substantially in the form provided by the Purchaser herewith, is
received by the Depositary as provided below prior to the Expiration Date;
and
(iii) the certificates for all tendered Shares, in proper form for
transfer (or a Book-Entry Confirmation), together with 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) and any other documents required by the
Letter of Transmittal are received by the Depositary within three NASDAQ
National Market ("NNM") trading days after the date of execution of such
Notice of Guaranteed Delivery. Stockholders may not extend the foregoing
time period for delivery of Shares to the Depositary by providing a second
Notice of Guaranteed Delivery with respect to such Shares.
Any Notice of Guaranteed Delivery may be delivered by hand or transmitted
by telegram, telex, facsimile transmission or mail to the Depositary and must
include a guarantee by an Eligible Institution in the form set forth in the
Notice of Guaranteed Delivery.
Notwithstanding any other provision hereof, payment for Shares purchased
pursuant to the Offer will in all cases be made only after timely receipt by the
Depositary of (i) certificates evidencing the Shares or a timely Book-Entry
Confirmation of the delivery of such Shares, (ii) a Letter of Transmittal (or
manually signed facsimile thereof), properly completed and duly executed, with
any required signature guarantees (or, in the case of a book-entry transfer, an
Agent's Message) and (iii) any other documents required by the Letter of
Transmittal. Accordingly, payment might not be made to all tendering
stockholders at the same time, and will depend upon when certificates for the
Shares or Book-Entry Confirmations of the delivery of such Shares are received
into the Depositary's account at a Book-Entry Transfer Facility.
Backup Federal Withholding Tax. Under the backup federal income tax laws
and regulations applicable to certain stockholders (other than certain exempt
stockholders, including, among others, all corporations and certain foreign
individuals), the Depositary may be required to withhold 31% of the amount of
any payments made to such stockholders pursuant to the Offer. To prevent backup
federal income tax withholding with respect to payment of the purchase price for
Shares purchased pursuant to the Offer, a tendering stockholder must provide the
Depositary with such stockholder's correct taxpayer identification number and
certify that such stockholder is not subject to backup federal income tax
withholding by completing the Substitute Form W-9 included in the Letter of
Transmittal. See Instruction 9 to the Letter of Transmittal.
Determination of Validity. All questions as to the validity, form,
eligibility (including time of receipt) and acceptance for payment of any
tendered Shares pursuant to any of the procedures described above will be
determined in the sole discretion of the Purchaser, whose determination shall be
final and binding. The Purchaser reserves the absolute right to reject any or
all tenders of any Shares determined by it not to be in proper form or if the
acceptance for payment of, or payment for, such Shares may, in the opinion of
the Purchaser's counsel, be unlawful. The Purchaser also reserves the absolute
right, in its sole discretion, subject to the Merger Agreement, to waive any of
the conditions of the Offer or any defect or irregularity in any tender with
respect to Shares of any particular stockholder, whether or not similar defects
or irregularities are waived
6
<PAGE> 9
in the case of other stockholders. No tender of Shares will be deemed to have
been validly made until all defects and irregularities have been cured or
waived.
The Purchaser's interpretation of the terms and conditions of the Offer
(including the Letter of Transmittal and the Instructions thereto) will be final
and binding. None of the Purchaser, the Depositary, the Information Agent nor
any other person or entity will be under any duty to give notification of any
defects or irregularities in tenders or will incur any liability for failure to
give any such notification.
A tender of Shares pursuant to any one of the procedures described above
will constitute the tendering stockholder's acceptance of the terms and
conditions of the Offer. The Purchaser's acceptance for payment for Shares
tendered pursuant to the Offer will constitute a binding agreement between the
tendering stockholder and the Purchaser upon the terms and subject to the
conditions of the Offer.
Appointment as Proxy. By executing a Letter of Transmittal or by causing
the transmission of an Agent's Message as set forth above, a tendering
stockholder irrevocably appoints designees of the Purchaser as the stockholder's
attorneys-in-fact and proxies, in the manner set forth in the Letter of
Transmittal, each with full power of substitution, to the full extent of such
stockholder's rights with respect to the Shares tendered by such stockholder and
accepted for payment by the Purchaser (and any and all other Shares or other
securities issued or issuable in respect of such Shares on or after the date of
the Merger Agreement). All such proxies shall be considered coupled with an
interest in the tendered Shares. This appointment will be effective if, when,
and only to the extent that, the Purchaser accepts Shares for payment. Upon
acceptance for payment, all prior proxies given by the stockholder with respect
to the Shares or other securities will, without further action, be revoked, and
no subsequent proxies may be given. The designees of the Purchaser will, with
respect to the Shares and other securities for which the appointment is
effective, be empowered to exercise all voting and other rights of such
stockholder as they in their sole discretion may deem proper at any annual,
special or adjourned meeting of the Company's stockholders, by written consent
or otherwise. The Purchaser reserves the right to require that, in order for
Shares to be deemed validly tendered, immediately upon the Purchaser's
acceptance for payment of such Shares, the Purchaser must be able to exercise
full voting and other rights of a record and beneficial holder, including rights
in respect of acting by written consent, with respect to such Shares.
4. WITHDRAWAL RIGHTS.
Except as otherwise provided in this Section 4, tenders of Shares made
pursuant to the Offer are irrevocable. 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 September 6, 1996 (or such later date as may apply
in case the Offer is extended).
For a withdrawal to be effective, a written, telegraphic, telex or
facsimile transmission notice of withdrawal must be timely received by the
Depositary at one of its addresses set forth on the back cover of this Offer to
Purchase. Any such notice of withdrawal must specify the name of the person who
tendered the Shares to be withdrawn, the number of Shares to be withdrawn and
the name of the registered holder, if different from that of the person who
tendered such Shares. If certificates evidencing Shares to be withdrawn have
been delivered or otherwise identified to the Depositary, then, prior to the
release of such certificates, the serial numbers of the particular certificates
evidencing the Shares to be withdrawn and a signed notice of withdrawal with
signatures guaranteed by an Eligible Institution, except in the case of Shares
tendered for account of an Eligible Institution, must also be furnished to the
Depositary as described above. If Shares have been tendered pursuant to the
procedures for book-entry transfer as set forth in Section 3, any notice of
withdrawal must also specify the name and number of the account at the
appropriate Book-Entry Transfer Facility to be credited with the withdrawn
Shares.
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, WHOSE DETERMINATION WILL BE FINAL AND BINDING. NEITHER OF THE
PURCHASER, THE DEPOSITARY, THE INFORMATION AGENT NOR ANY OTHER PERSON OR ENTITY
WILL BE UNDER ANY DUTY TO GIVE NOTIFICATION OF ANY DEFECTS OR IRREGULARITIES IN
ANY NOTICE OF WITHDRAWAL OR INCUR ANY LIABILITY FOR FAILURE TO GIVE ANY
NOTIFICATION.
7
<PAGE> 10
Any Shares properly withdrawn will be deemed to be not validly tendered for
purposes of the Offer. However, withdrawn Shares may be re-tendered by following
one of the procedures described in Section 3 at any time prior to the Expiration
Date.
5. CERTAIN FEDERAL INCOME TAX CONSEQUENCES.
The receipt of cash for Shares pursuant to the Offer (or the Merger) will
be a taxable transaction for federal income tax purposes and may also be a
taxable transaction under applicable state, local or foreign tax laws. The tax
consequences of such receipt pursuant to the Offer (or the Merger) may vary
depending upon, among other things, the particular circumstances of the
stockholder. In general, a stockholder who receives cash for Shares pursuant to
the Offer (or the Merger) will recognize gain or loss for federal income tax
purposes equal to the difference between the amount of cash received in exchange
for the Shares sold and such stockholder's adjusted tax basis in such Shares.
Provided that the Shares constitute capital assets in the hands of the
stockholder, such gain or loss will be capital gain or loss, and will be long
term capital gain or loss if the holder has held the Shares for more than one
year at the time of sale. Gain or loss will be calculated separately for each
block of Shares tendered pursuant to the Offer.
The foregoing discussion may not be applicable to certain types of
stockholders, including stockholders who acquired Shares pursuant to the
exercise of employee stock options or otherwise as compensation, individuals who
are not citizens or residents of the United States, foreign corporations and
entities that are otherwise subject to special tax treatment under the Internal
Revenue Code of 1986, as amended (the "Internal Revenue Code"), such as
insurance companies, tax-exempt entities and regulated investment companies.
THE FEDERAL INCOME TAX DISCUSSION SET FORTH ABOVE IS INCLUDED FOR GENERAL
INFORMATION ONLY AND IS BASED UPON PRESENT LAW. STOCKHOLDERS ARE URGED TO
CONSULT THEIR TAX ADVISORS WITH RESPECT TO THE SPECIFIC TAX CONSEQUENCES OF THE
OFFER AND THE MERGER TO THEM, INCLUDING THE APPLICATION AND EFFECT OF THE
ALTERNATIVE MINIMUM TAX, AND STATE, LOCAL AND FOREIGN TAX LAWS.
6. PRICE RANGE OF SHARES; DIVIDENDS.
According to the Company's Annual Report on Form 10-K for the fiscal year
ended June 30, 1995 (the "Company Form 10-K"), the Company's Quarterly Report on
Form 10-Q for the fiscal quarter ended March 31, 1996 and information supplied
to the Purchaser by the Company, the Shares are traded on the NASDAQ National
Market under the trading symbol "AMBR". The following table sets forth, for the
periods indicated, the high and low bid prices per Share on the NASDAQ National
Market as reported in publicly available sources.
<TABLE>
<CAPTION>
HIGH LOW
---- ----
<S> <C> <C>
FISCAL 1995
First Quarter................................................................ 4 1/4 4
Second Quarter............................................................... 6 3 3/4
Third Quarter................................................................ 4 3/4 4 1/2
Fourth Quarter............................................................... 4 1/2 4 3/8
FISCAL 1996
First Quarter................................................................ 5 3/8 4 1/4
Second Quarter............................................................... 8 5 1/4
Third Quarter................................................................ 11 1/8 7 7/8
Fourth Quarter............................................................... 14 3/4 9 3/4
FISCAL 1997
First Quarter (through July 8, 1996)......................................... 17 5/8 14 1/2
</TABLE>
On July 1, 1996, the last full trading day prior to the announcement of the
Merger Agreement, the reported closing bid price per Share on the NASDAQ
National Market was $14.50. On July 8, 1996, the last full trading day prior to
the commencement of the Offer, the reported closing bid price per Share on the
8
<PAGE> 11
NASDAQ National Market was $17 5/8. STOCKHOLDERS ARE URGED TO OBTAIN A CURRENT
MARKET QUOTATION FOR THE SHARES.
The Company has advised the Purchaser that the Company has never declared
or paid any cash dividends in respect of the Shares. The Company has agreed
pursuant to the Merger Agreement that prior to the Merger it will not declare,
set aside for payment or pay any dividends.
7. CERTAIN INFORMATION CONCERNING THE COMPANY.
The information concerning the Company contained in this Offer to Purchase,
including financial information, has been furnished by the Company or has been
taken from or based upon publicly available documents on file with the
Commission and other publicly available information. Neither the Purchaser nor
Parent assumes any responsibility for the accuracy or completeness of the
information contained in such documents or for any failure by the Company to
disclose events that may have occurred and may affect the significance or
accuracy of any such information but which are unknown to either the Purchaser
or Parent.
General. The Company is a Delaware corporation with its principal
executive offices located at 221 Rue de Jean, Lafayette, Louisiana 70508.
According to the Company's public information, the Company designs, blends and
markets certain fluids and chemicals and provides environmental services
primarily to oil and gas operators along the Gulf Coast, principally Louisiana
and Texas. Also, the Company has publicly reported entering into a long-term
feedstock agreement for a brine stream and acquiring an evaporation plant in
Manistee, Michigan that it is presently retrofitting to produce liquid and dry
calcium chloride.
Selected Consolidated Financial Data. The following selected consolidated
financial data relating to the Company have been taken or derived from the
audited financial statements contained in the Company's annual report on Form
10-K for the period ended June 30, 1995 (the "Company Form 10-K") and the
unaudited financial statements contained in the Company's quarterly report on
Form 10-Q for the quarterly period ended March 31, 1996 (the "Company Form
10-Q"). More comprehensive financial information (including the notes to the
Company's financial statements) is included in such Company Form 10-K and
Company Form 10-Q and the other documents filed by the Company with the
Commission, and the financial data set forth below are qualified in their
entirety by reference to such reports and other documents, including the
financial statements (and notes thereto) and management's discussion and
analysis contained therein. Such reports and other documents may be examined and
copies may be obtained from the offices of the Commission in the manner set
forth below.
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<PAGE> 12
AMBAR, INC.
SELECTED CONSOLIDATED FINANCIAL DATA
(IN THOUSANDS, EXCEPT SHARE AND PER SHARE DATA)
<TABLE>
<CAPTION>
NINE
FISCAL YEAR ENDED MONTHS ENDED
JUNE 30, MARCH 31,
--------------------------------- ---------------------
1993 1994 1995 1995 1996
--------- --------- --------- --------- ---------
(UNAUDITED)
<S> <C> <C> <C> <C> <C>
INCOME STATEMENT DATA
Revenues:
Oil field products and services......... $20,973 $37,546 $31,661 $24,842 $27,883
Environmental products and services..... 3,946 5,762 6,416 4,539 7,725
--------- --------- --------- --------- ---------
Total revenues.................. 24,919 43,308 38,077 29,381 35,608
--------- --------- --------- --------- ---------
Cost of Revenues:
Oil field products and services......... 18,400 31,146 28,197 21,652 24,630
Environmental products and services..... 4,196 5,220 5,039 3,418 7,087
--------- --------- --------- --------- ---------
Total cost of revenues.......... 22,596 36,366 33,236 25,070 31,717
--------- --------- --------- --------- ---------
Gross profit.............................. 2,323 6,942 4,841 4,311 3,891
Selling, general and administrative....... 4,139 4,567 4,470 3,302 3,418
--------- --------- --------- --------- ---------
Operating income (loss)................... (1,816) 2,375 371 1,009 473
Interest expense, net..................... 77 356 697 543 675
--------- --------- --------- --------- ---------
Income (loss) before income taxes......... (1,893) 2,019 (326) 466 (202)
Income tax provision (benefit)............ (693) 742 (90) 172 (73)
--------- --------- --------- --------- ---------
Net income (loss)......................... $(1,200) $ 1,277 $ (236) $ 294 $ (129)
Net income (loss) per common share........ $ (.33) $ .35 $ (.06) $ .08 $ (.03)
Weighted average common shares
outstanding............................. 3,628,691 3,632,765 3,667,344 3,663,481 3,732,288
Cash dividends per common share........... -- -- -- -- --
</TABLE>
<TABLE>
<CAPTION>
MARCH 31,
1996
JUNE 30, -----------
1995
-------- (UNAUDITED)
<S> <C> <C>
BALANCE SHEET DATA
Total current assets................................................... $ 16,498 $23,767
Total assets........................................................... 27,746 39,077
Total current liabilities.............................................. 8,925 17,601
Long-term liabilities.................................................. 3,947 6,611
Total stockholders' equity............................................. 14,874 14,865
</TABLE>
The Company is subject to the information and filing requirements of the
Exchange Act and is required to file periodic reports, proxy statements and
other information with the Commission relating to its business, financial
condition and other matters. Information, as of particular dates, concerning the
Company's directors and officers, their remuneration, stock options granted to
them, the principal holders of the Company's securities and any material
interest of such persons in transactions with the Company is required to be
described in proxy statements distributed to the Company's stockholders and
filed with the Commission. These reports, proxy statements and other information
should be available for inspection and copying at the Commission's principal
office at 450 Fifth Street, N.W., Washington, D.C. 20549, and at the regional
offices of the Commission located at Seven World Trade Center, 13th Floor, New
York, New York 10048 and Citicorp Center, 500 West Madison Street, Suite 1400,
Chicago, Illinois 60661. Copies of these materials may also be obtained by mail,
upon payment of the Commission's customary fees, from the Commission's principal
office at 450 Fifth Street, N.W., Washington, D.C. 20549. In addition, certain
material filed by the Company
10
<PAGE> 13
should also be available for inspection at the offices of the National
Association of Securities Dealers, Inc., Reports Section, 1735 K Street, N.W.,
Washington, D.C. 20006.
8. CERTAIN INFORMATION CONCERNING THE BEACON GROUP, PARENT AND THE PURCHASER.
The Beacon Group is a private investment and advisory partnership which is
a New York general partnership. The Beacon Group formed Parent and the Purchaser
for the purposes of the transactions described in this Offer to Purchase. The
Beacon Group's address is 375 Park Avenue, Suite 1705, New York, New York 10152.
For certain information concerning the general partners of The Beacon Group, see
Schedule I to this Offer to Purchase.
The Purchaser is a newly incorporated Delaware corporation and a wholly
owned subsidiary of Parent, which is a newly formed Delaware limited
partnership. The general partner of Parent is AI-GP, L.L.C. ("AI-GP"), a newly
formed Delaware limited liability company. The sole member of AI-GP is Energy
Fund GP, Inc., a Delaware corporation ("Energy Fund"), all of the outstanding
stock of which is owned by The Beacon Group Holdings, L.L.C., a Delaware limited
liability company ("Holdings"), the sole member of which is The Beacon Group. To
date, none of AI-GP, Parent and the Purchaser have conducted any business other
than incident to their formation, the execution and delivery of the Merger
Agreement and commencement of the Offer. Accordingly, no meaningful financial
information with respect to AI-GP, Parent or the Purchaser is available. The
principal executive offices of Holdings, Energy Fund, AI-GP, Parent and the
Purchaser are located at 375 Park Avenue, Suite 1705, New York, New York 10152.
For certain information concerning the members, partners and directors and
executive officers, respectively, of The Beacon Group, Holdings, Energy Fund,
AI-GP, Parent and the Purchaser, see Schedule I to this Offer to Purchase.
Except as provided in the Merger Agreement, and as otherwise described in
this Offer to Purchase, none of The Beacon Group, Holdings, Energy Fund, AI-GP,
Parent or the Purchaser, nor to the best knowledge of Parent and the Purchaser,
any of the persons listed on 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 securities of the Company, joint ventures, loan or option arrangements,
puts or calls, guarantees of loans, guarantees against loss of the giving or
withholding of proxies. Except as set forth in this Offer to Purchase, none of
The Beacon Group, Holdings, Energy Fund, AI-GP, Parent or the Purchaser, nor, to
the best of their knowledge, any of the persons listed on Schedule I hereto, has
had, since July 1, 1993, any business relationships or transactions with the
Company or any of its executive officers, directors or affiliates that would
require reporting under the rules of the Commission applicable to this Offer to
Purchase. Except as set forth in this Offer to Purchase, since July 1, 1993,
there have been no contacts, negotiations or transactions between the Purchaser,
Parent or any of its subsidiaries or, to the best knowledge of Parent and the
Purchaser, any of the persons listed on Schedule I hereto, and the Company or
its affiliates, 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. Except as set forth in this Offer to
Purchase, and, neither Parent nor the Purchaser, nor, to the best knowledge of
Parent or the Purchaser, any of the persons listed on Schedule I hereto,
beneficially owns any Shares or has effected any transactions in the Shares in
the past 60 days.
9. SOURCE AND AMOUNT OF FUNDS.
The Purchaser estimates that the total amount of funds required by the
Purchaser to purchase all outstanding Shares and to pay related fees and
expenses will be approximately $73.5 million. The funds necessary to purchase
Shares pursuant to the Offer and to pay related fees and expenses will be
furnished to the Purchaser in the form of capital contributions by Parent.
Parent expects to obtain such funds from the proceeds of the sale of partnership
interests to the institutions and other investors that have made capital
commitments to an affiliate of Parent.
11
<PAGE> 14
10. BACKGROUND OF THE OFFER; PAST CONTACTS, TRANSACTIONS OR NEGOTIATIONS WITH
THE COMPANY.
In early April, 1996, representatives of The Beacon Group and the Company
conducted several preliminary discussions regarding the possibility of The
Beacon Group investing in the Company, and on April 23, 1996, The Beacon Group
entered into a confidentiality agreement with the Company. On April 26, 1996,
Randolph M. Moity, Sr., the Chairman of the Board, Chief Executive Officer and
President of the Company, met with Robert F. Semmens, a Partner in The Beacon
Group. At that meeting, Mr. Moity and Mr. Semmens discussed the terms under
which The Beacon Group might invest in the Company. Mr. Moity informed Mr.
Semmens at that time that the Company was contemplating a sale of its common
stock to the public, but that the Company would be willing to consider an
alternative investment from The Beacon Group on a more expeditious schedule than
a public offering. During the next several weeks representatives of the Company
continued to prepare for a public offering and at the same time took part in
several meetings and phone calls with representatives of The Beacon Group during
which several alternative investment proposals, as well as the business of the
Company, were discussed. Thereafter, and throughout June 1996, the parties
conducted due diligence in accordance with the terms of the confidentiality
agreement dated April 23, 1996.
On May 23, 1996, Mr. Semmens and Harold W. Pote, another Partner in The
Beacon Group, attended a meeting of the Board of Directors of the Company in
Lafayette, Louisiana. At that meeting, Messrs. Semmens and Pote proposed a
financing under which The Beacon Group would purchase for approximately $25
million from the Company an issue of convertible preferred stock and the Company
would not pursue its public offering. At the end of the meeting, the Company's
Board of Directors decided to reject The Beacon Group's proposal and to pursue
the public offering.
On May 29, 1996, Mr. Moity met in The Beacon Group's offices in New York
with several Partners in The Beacon Group, including Mr. Semmens and Mr. Pote.
At that meeting, Mr. Semmens and Mr. Pote proposed to Mr. Moity that, subject to
certain conditions, The Beacon Group purchase 100% of the outstanding common
equity of the Company through a transaction that Mr. Moity, as the Company's
majority stockholder, would support. In connection with that proposal Mr.
Semmens and Mr. Pote told Mr. Moity that The Beacon Group was prepared to
purchase all of the Company's common stock at $14.50 per share.
As a result of the proposal made to Mr. Moity on May 29, 1996, a special
meeting of the Company's Board of Directors was called in New Orleans, Louisiana
on May 31, 1996. At that meeting, the Board of Directors appointed an
Independent Committee of the Board of Directors to evaluate The Beacon Group's
proposal. The Independent Committee was composed of all of the members of the
Company's Board of Directors with the exception of Mr. Moity. Thereafter, the
Independent Committee retained counsel and a financial advisor, Raymond James,
to aid it in its evaluation of The Beacon Group's proposal.
On June 7, 1996, the Independent Committee informed The Beacon Group that
the purchase price proposed was inadequate and rejected the proposal.
Discussions ensued over the next several days between the Independent Committee
and The Beacon Group over the structure of the transaction proposed by The
Beacon Group and the purchase price. On June 10, 1996, The Beacon Group informed
the Independent Committee that it was willing to raise the purchase price in its
proposal to $16.25 per share. On June 14, 1996, after conferring with its
financial advisor, the Independent Committee rejected the new purchase price
proposed by The Beacon Group as inadequate.
Between June 14, 1996 and June 27, 1996, members of the Independent
Committee continued to have periodic discussions with The Beacon Group. On June
27, 1996, Mr. Semmens indicated to Mr. Moity and Mr. Robert D. van Roijen,
Co-Chairman of the Independent Committee, that The Beacon Group would be
interested in resuming merger negotiations, and that if the results of such
negotiations proved to be satisfactory, The Beacon Group would increase its
offer to $18.00 per share. Thereafter, on June 28 and 29, 1996, Messrs. Moity
and van Roijen met in New York with Mr. Semmens, Mr. Pote and several other
representatives of The Beacon Group. Counsel for the Company and counsel for The
Beacon Group were present at such meetings. At those meetings, the acquisition
of all of the Company's shares at a purchase price of $18.00 per share was
agreed upon. During the period preceding and throughout such meetings,
representatives of the Company and The Beacon Group engaged in extensive
negotiations relating to the terms of the Merger Agreement. Also at the
meetings, the Stockholder Agreements were negotiated. The Beacon Group
conditioned its willingness to enter into
12
<PAGE> 15
the transactions contemplated by the Merger Agreement upon the Principal
Stockholders entering into the Stockholder Agreements which provide assurances
that such stockholders would sell their Shares to the Purchaser.
On July 1, 1996, the Independent Committee informed the Company's Board of
Directors of the results of its deliberations with The Beacon Group and that its
financial advisor had opined that the purchase price proposed by The Beacon
Group was fair to the Company's stockholders from a financial point of view and
that the Independent Committee recommended the Offer and the Merger. Thereafter,
the Company's Board of Directors approved the Merger Agreement and determined to
recommend that stockholders tender their shares in the Offer. The Company's
Board of Directors also approved, for purposes of Section 203 of the Delaware
General Corporation Law (the "GCL"), the Stockholder Agreements.
After the close of business on July 1, 1996, the Merger Agreement and the
Stockholder Agreements were executed and delivered. The transaction was publicly
announced on the morning of July 2, 1996. A summary of the respective terms of
the Merger Agreement and the Stockholder Agreements are set forth in Section 11.
Copies of the Merger Agreement and the Stockholder Agreements have been filed as
exhibits to the Schedule 14D-1 filed by Parent and the Purchaser with the
Commission and are available for inspection and copy at the principal office of
the Commission in the manner set forth in Section 7.
On July 9, 1996, the Purchaser commenced the Offer.
11. PURPOSE OF THE OFFER; THE MERGER; THE MERGER AGREEMENT; STOCKHOLDER
AGREEMENTS; EMPLOYMENT AGREEMENT; PLANS FOR THE COMPANY.
The purpose of the Offer, the Stockholder Agreements, the Merger and the
Merger Agreement is for Parent to acquire control of, and the entire common
equity interest in, the Company. The Offer, the Stockholder Agreements, and the
Merger Agreement are intended to increase the likelihood that the Merger will be
effected as promptly as practicable.
The Merger Agreement. The following summary of the Merger Agreement, a
copy of which is filed as an exhibit to the Schedule 14D-1, is qualified by
reference to the Merger Agreement.
The Offer. The Merger Agreement provides for the making of the Offer. The
obligation of the Purchaser to accept for payment or pay for Shares tendered
pursuant to the Offer is subject to the satisfaction of the Minimum Share
Condition and certain other conditions that are described in Section 14 hereof.
The Purchaser has reserved the right to modify any of the terms and conditions
of the Offer except that neither Parent nor the Purchaser will, without the
prior written consent of the Board of Directors of the Company (excluding any
designee of the Purchaser), decrease the consideration, or change the form of
consideration, payable in the Offer, decrease the number of Shares sought
pursuant to the Offer, change the conditions to the Offer, impose additional
conditions to the Offer, change the Expiration Date of the Offer, or amend any
term of the Offer in any manner adverse to holders of the Shares.
Recommendation. The Board of Directors of the Company (at a meeting duly
called and held) has, based upon, among other things, the unanimous
recommendation of a duly appointed Independent Committee of the Board and the
opinion of Raymond James, its financial advisor, that the proposed consideration
to be paid in the Offer and the Merger is fair from a financial point of view to
the holders of Shares, (i) determined that the Offer and the Merger are fair to,
and in the best interests of, the stockholders of the Company, (ii) taken all
actions to approve the Offer, the Merger and the Stockholder Agreements for
purposes of Section 203 of the GCL and (iii) subject to its fiduciary duties
under applicable laws as advised by counsel, resolved to recommend acceptance of
the Offer and approval and adoption of the Merger Agreement by the stockholders
of the Company.
Board Representation. The Merger Agreement provides that promptly upon the
purchase by the Purchaser of at least a majority of the outstanding Shares, the
Purchaser will be entitled to designate such number of directors, rounded up to
the next whole number, but in no event more than one less than the total number
of directors on the Board of Directors of the Company as will give the
Purchaser, subject to compliance with Section 14(f) of the Exchange Act,
representation on the Board of Directors of the Company equal to the product of
the number of directors on the Board of Directors of the Company and the
percentage
13
<PAGE> 16
that such number of Shares so purchased bears to the number of Shares
outstanding, and, subject to the exercise by the Board of Directors of the
Company of its fiduciary duties to the stockholders of the Company under the
GCL, the Company shall, upon request by the Purchaser, promptly increase the
size of the Board of Directors of the Company or exercise its best efforts to
secure the resignations of such number of directors as is necessary to enable
the Purchaser's designees to be elected to the Board of Directors of the Company
and shall cause the Purchaser's designees to be so elected; provided, however,
that in the event that Purchaser's designees are appointed or elected to the
Board of Directors, until the Effective Time (as defined in the Merger
Agreement) the Board of Directors shall have at least three directors who were
directors on the date of the Merger Agreement designated by the Company and who
are not designees, stockholders or affiliates of Parent or the Purchaser (the
"Independent Directors"); provided further, that in such event, if the number of
Independent Directors shall be reduced to below three for any reason whatsoever,
any remaining Independent Directors (or Independent Director, if there shall be
only one remaining) shall be entitled to designate persons to fill such
vacancies who shall be deemed to be Independent Directors for purposes of the
Merger Agreement or, if no Independent Directors then remain, the other
directors shall in good faith designate three persons to fill such vacancies who
shall be independent in fact and, in any event, shall not be stockholders,
affiliates or agents of Parent or the Purchaser and such persons shall be deemed
to be Independent Directors for purposes of the Merger Agreement. At the
reasonable request of the Purchaser, the Company shall take, at its expense, all
action necessary to effect any such election, including mailing to its
stockholders the information required by Section 14(f) of the Exchange Act and
Rule 14f-1 promulgated thereunder.
The Merger. The Merger Agreement provides that upon the terms and subject
to the provisions thereof, and in accordance with the relevant provisions of the
GCL, the Purchaser shall be merged with and into the Company as soon as
practicable following the satisfaction or waiver, if permissible, of the
conditions described below under "Conditions to the Merger." Following the
Merger, the Company shall continue as the surviving corporation (the "Surviving
Corporation") under the name "AMBAR, Inc." and shall continue its existence
under the laws of Delaware, and the separate corporate existence of the
Purchaser shall cease. The Merger Agreement further provides that (i) the
certificate of incorporation and the bylaws of the Surviving Corporation after
the Effective Time shall be as set forth in Exhibit B to the Merger Agreement,
(ii) the directors of the Purchaser immediately prior to the Effective Time
shall become the directors of the Surviving Corporation until their successors
are duly elected and qualified, and (iii) the officers of the Company
immediately prior to the Effective Time shall become the officers of the
Surviving Corporation until their successors are duly elected and qualified.
Consideration to be Paid in the Merger. The Merger Agreement provides that
at the Effective Time, each Share outstanding immediately prior to the Effective
Time (other than Shares owned by the Purchaser or any affiliate of the Purchaser
or held in the treasury of the Company or by any subsidiary of the Company, all
of which shall be cancelled and no payment shall be made with respect thereto,
and other than Dissenting Shares (as defined below under "Dissenters' Rights"))
shall, by virtue of the Merger and without any action on the part of the holder
thereof, be converted into a right to receive in cash an amount per Share equal
to the highest price that may be paid pursuant to the Offer, payable to the
holder thereof, without interest thereon, upon surrender of the certificate
representing such Share. Each share of common stock of the Purchaser issued and
outstanding immediately prior to the Effective Time will by virtue of the Merger
and without any action on the part of the holder thereof, be converted into and
exchanged for one share of common stock of the Surviving Corporation.
Company Options and Warrants. All Options pursuant to the Company's Stock
Option Plans shall, in accordance with such Plans, become exercisable upon
consummation of the Merger and the Shares received upon such exercise shall be
convertible in the Merger into cash in an amount equal to the Offer Price, less
required withholding taxes. The Merger Agreement provides that the Company will
take reasonable actions to effect the provisions of the Merger Agreement related
to the Options, including using reasonable efforts to obtain the written
acknowledgment of each holder of Options that the payment of such amount will
fully discharge the Company's obligations with respect thereto. Subsequent to
the Effective Time, Options will no longer be issued under the Company's Stock
Option Plans.
Upon the Merger, the Warrants issued pursuant to the Warrant Agreement
dated December 12, 1991 will be exercisable only for the Merger consideration.
14
<PAGE> 17
Stockholders' Meeting. In the Merger Agreement, the Company has agreed, if
required by applicable law in order to consummate the Merger, in accordance with
applicable law, to duly call, give notice of, convene and hold a special meeting
of its stockholders as soon as practicable following the expiration of the Offer
for the purpose of adopting the Merger Agreement. At any such meeting, all
Shares acquired by Parent, the Purchaser or any other affiliate of Purchaser
pursuant to the Offer, the Stockholder Agreements or otherwise will be voted in
favor of the Merger. The Board of Directors of the Company will recommend that
stockholders of the Company vote in favor of the approval and adoption of the
Merger Agreement.
Dissenters' Rights; Rule 13e-3. Holders of Shares will not have appraisal
rights as a result of the Offer. If the Merger is consummated, however, persons
who hold Shares at such time will have the right to appraisal of their Shares in
accordance with Section 262 of the GCL. Such appraisal rights, if the statutory
procedures are complied with, would result in a judicial determination of the
"fair value" of the Shares owned by such holders. Any such judicial
determination of the fair value of the Shares could be based upon considerations
other than or in addition to the price paid in the Offer and the Merger and the
market value of the Shares, including asset values, the investment value of the
Shares and any other valuation considerations generally accepted in the
investment community. The value so determined for Shares could be more or less
than the value of the consideration per Share to be paid pursuant to the Offer
or the Merger and payment of such consideration would take place subsequent to
payment pursuant to the Offer.
Several recent decisions by the Delaware courts have held that a
controlling stockholder of a corporation involved in a merger has a fiduciary
duty to the other stockholders which requires that the merger be fair to such
other stockholders. In determining whether a merger is fair to minority
stockholders, the Delaware courts have considered, among other things, the type
and amount of consideration to be received by the stockholders and whether there
was fair dealing among the parties. The Delaware Supreme Court indicated in
Weinberger v. UOP, Inc. and Rabkin v. Philip A. Hunt Chemical Corp. that
ordinarily the remedy available to stockholders in a merger that is found not to
be "fair" to minority stockholders is the right to appraisal described above or
a damages remedy based on essentially the same principles.
If the Purchaser purchases Shares pursuant to the Offer, and the Merger or
another merger or other business combination is consummated more than one year
after the completion of the Offer, or if such a merger or other business
combination were to provide for the payment of consideration less than that paid
pursuant to the Offer, compliance by the Purchaser with Rule 13e-3 under the
Exchange Act would be required, unless the Shares were to be registered under
the Exchange Act prior to such transaction. See Section 12. Rule 13e-3 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 minority stockholders therein be
filed with the Commission and disclosed to minority stockholders prior to
consummation of the transaction.
Representations and Warranties. The Merger Agreement contains
representations and warranties by the Company, relating to, among other things,
(i) the organization of the Company and its subsidiaries and other corporate
matters, (ii) the capital structure of the Company, (iii) the authorization,
execution, delivery and consummation of the transactions contemplated by the
Merger Agreement, (iv) the absence of certain changes and events, (v) documents
filed by the Company with the Commission and the accuracy of the information
contained therein, (vi) the accuracy of the information contained in documents
filed with the Commission in connection with the Offer and the Merger, (vii)
consents and approvals, (viii) the non-existence of undisclosed brokerage fees
and commissions, (ix) the existence of employment agreements, (x) litigation,
(xi) the absence of undisclosed liabilities, (xii) compliance with laws and
agreements, (xiii) environmental matters, (xiv) tax and labor matters and (xv)
matters relating to the Employee Retirement Income Security Act of 1974, as
amended, and the rules and regulations promulgated thereunder. In the Merger
Agreement, the Parent and the Purchaser have made certain representations and
warranties to the Company relating to, among other things, (a) the comparable
matters with respect to the Parent and the Purchaser set forth in clauses (i),
(iii), (iv), (vii), (viii) and (x) above, (b) the sufficiency of funds to be
available to purchase Shares pursuant to the Offer and to pay all fees and
expenses related to the transactions contemplated by the Merger and to pay the
related fees and expenses of Parent and the Purchaser and (c) the interim
operations of the Purchaser. The representations and warranties contained in the
Merger Agreement
15
<PAGE> 18
are qualified in certain respects by materiality standards, are given only as of
the date of execution of the Merger Agreement, and do not survive beyond the
Effective Time.
Agreements with Respect to the Conduct of Business Pending the Merger. The
Merger Agreement provides that, except as specifically contemplated by the
Merger Agreement, during the period from the date of the Merger Agreement to the
earlier of the Effective Time or earlier termination of the Merger Agreement,
unless Parent shall otherwise agree in writing, the Company will, and will cause
each of its subsidiaries to, (i) conduct their respective businesses only in,
and not take any action except in, the ordinary and usual course of business and
consistent with past practice, and use their best efforts to preserve intact
their respective business organizations and goodwill, keep available the
services of their respective present officers and key employees and preserve the
goodwill and business relationships with suppliers, distributors, customers and
others having business relationships with them. In addition, subject to certain
exceptions, during such period, the Company will not, and will not permit any of
its subsidiaries to (i) make or propose any change or amendment to their
respective certificate of incorporation or bylaws; (ii) split, combine or
reclassify their outstanding capital stock or declare, set aside or pay any
dividend or distribution payable in cash, stock, property or otherwise; (iii)
knowingly take any action which would result in a failure to maintain the
trading of Company common stock on the NASDAQ Stock Market; (iv) authorize the
issuance of, or issue, sell, pledge or dispose of, or agree to issue, sell,
pledge or dispose of, any additional shares of or any options, warrants or
rights of any kind to acquire any shares of, their capital stock of any class or
any debt or equity securities convertible into or exchangeable for such capital
stock; (v) sell (including, without limitation, by sale/leaseback), pledge,
dispose of, license or encumber any material assets (including, without
limitation, intellectual property), or any interests therein, other than in the
ordinary course of business and consistent with past practice; (vi) redeem,
purchase, acquire or offer to purchase or acquire any (x) shares of its capital
stock, other than in accordance with the governing terms of such securities or
(y) long-term debt, other than as required by the governing instruments relating
thereto; (vii) enter into any contract, agreement, commitment or arrangement
with respect to the foregoing clauses (iv) through (vi); (viii) except with the
prior written approval of Parent, adopt, enter into or amend any bonus, profit
sharing, compensation (except ordinary course salary adjustments consistent with
historic practice), severance, termination, stock option, pension, retirement,
deferred compensation, health care, change in control agreement, restricted
stock, employment or other employee benefit plan, agreement, trust, fund or
arrangement for the benefit or welfare of any employee, director, officer or
retiree, or increase in any manner the compensation or fringe benefits of any
director or officer or pay any benefit not required by any existing plan,
arrangement or contract (including, without limitation, the granting of stock
options, stock appreciation rights, shares of restricted stock or performance
units) or take any action or grant any benefit not expressly required under the
terms of any existing contracts, trusts, plans, funds or other such arrangements
or enter into any contract to do any of the foregoing, except as required to
comply with changes in applicable law occurring after the date of the Merger
Agreement; (ix) establish any new lines of credit or other credit facilities or
incur any indebtedness other than pursuant to existing credit facilities except
for trade liabilities incurred in the ordinary course of business or assume,
guarantee, endorse or otherwise become liable (whether directly, contingently or
otherwise) for the obligation of any other person except in the ordinary course
of business and consistent with past practice, or make any loans, advances or
capital contributions to, or investments (other than intercompany accounts and
short-term investments pursuant to customary cash management systems of the
Company in the ordinary course and consistent with past practices) in any other
person other than such of the foregoing as are made by the Company to or in a
wholly owned subsidiary of the Company; (x) acquire, or publicly propose to
acquire, all or any substantial part of the business and properties or capital
stock of any person not a party to the Merger Agreement, whether by merger,
purchase of assets, tender offer or otherwise; (xi) enter into or amend any
employment, severance, special pay arrangement with respect to termination of
employment or other similar arrangements or agreements with any directors,
officers or key employees; (xii) enter into any material arrangement, agreement
or contract with any third party (other than customers in the ordinary course of
business) which provides for an exclusive arrangement with that third party or
is substantially more restrictive on the Company or substantially less
advantageous to the Company than arrangements, agreements or contracts existing
on the date of the Merger Agreement; or (xiii) agree in writing, or otherwise,
to take any of the foregoing actions or any other action which would make any
representation or warranty contained in the
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Merger Agreement untrue or incorrect in any material respect as of the time of
Closing (as defined in the Merger Agreement). In addition, the Company shall and
shall cause each of its subsidiaries to (i) confer on a regular and frequent
basis with one or more representatives of Parent to discuss operational matters
of materiality and the general status of ongoing operations; (ii) promptly
notify Parent of any significant changes in the business, financial condition or
results of operations of the Company or its subsidiaries taken as a whole; and
(iii) maintain with financially responsible insurance companies, insurance on
its tangible assets and its businesses in such amounts and against such risks
and losses as are consistent with past practice. In addition, the Company has
agreed to use its reasonable best efforts to (a) exempt the Company, the Offer,
the Stockholder Agreements and the Merger from the requirements of any state
takeover law by action of the Company's Board of Directors or otherwise and (b)
assist in any challenge by the Purchaser to the validity or applicability to the
Offer or the Merger of any state takeover law.
No Solicitation. The Merger Agreement provides that the Company shall not,
and shall not permit any of its subsidiaries and their respective officers,
directors, employees, representatives, agents or affiliates (including, without
limitation, any investment banker, attorney or accountant retained by the
Company or any of its subsidiaries) to, directly or indirectly, encourage,
solicit, initiate or participate in any way in any discussions or negotiations
with, or provide any non-public information to, or afford any access to the
properties, books or records of the Company or any of its subsidiaries, or
otherwise assist or facilitate any corporation, partnership, person or other
entity or group (other than Parent or Purchaser or any affiliate or associate of
Parent or Purchaser) concerning any Acquisition Transaction (as defined below);
provided, however, that the Board of Directors of the Company is not prohibited
from furnishing information to or entering into discussions or negotiations with
any person or entity that makes an unsolicited, written, bona fide proposal to
engage in an Acquisition Transaction if, and only to the extent that, (i) the
Board of Directors determines, after consultation with outside legal counsel,
that failure to take any such action would be inconsistent with its fiduciary
duties under the GCL and (ii) prior to taking such action, the Company receives
from such person or entity an executed confidentiality agreement on terms no
less favorable to the Company than the letter agreement dated April 23, 1996
between the Company and The Beacon Group; and provided, further, that the
Company or its Board of Directors shall not be prohibited from taking and
disclosing to the Company's stockholders a position with respect to a tender
offer by a third party pursuant to Rules 14d-9 and 14e-2(a) promulgated under
the Exchange Act. The Company has agreed to immediately notify Parent and the
Purchaser if any such information is requested from it or any such negotiations
or discussions are sought to be initiated with the Company and to immediately
communicate to Parent and the Purchaser the identity of such party and what
information is provided to such party. In addition, the Merger Agreement
requires the Company to cease and to cause its subsidiaries, affiliates and
their respective officers, directors, employees, representatives and agents to
immediately cease and cause to be terminated any existing activities,
discussions or negotiations with any parties other than Parent, the Purchaser or
any of their respective affiliates or associates conducted heretofore with
respect to any Acquisition Transaction. Except as is required in the exercise of
the fiduciary duties of the Board of Directors of the Company in the written
opinion of outside counsel to the Company, the Company agrees not to release any
third party from any confidentiality or standstill agreement to which the
Company is a party without Parent's prior written consent and to take all steps
deemed necessary or appropriate by Parent to enforce to the fullest extent
possible all such agreements. The term "Acquisition Transaction" means any
tender offer or exchange offer, any merger, consolidation, liquidation,
dissolution, recapitalization, reorganization or other business combination, any
acquisition, sale or other disposition of all or a substantial portion of the
assets or securities of the Company or any other similar transaction involving
the Company, its securities or any of its material subsidiaries or divisions.
Conditions to the Merger. The respective obligations of each party to
effect the Merger are subject to the satisfaction or waiver, where permissible,
prior to the Effective Time, of the following conditions: (a) the Merger
Agreement shall have been adopted by the requisite vote of the stockholders of
the Company in accordance with applicable law, if such vote is required by
applicable law; (b) no statute, rule, regulation, executive order, decree or
injunction shall have been enacted, entered, promulgated or enforced by any
federal or state court or governmental authority which is in effect and has the
effect of making the acquisition of Shares pursuant to the Merger illegal or
otherwise prohibiting the consummation of the Merger; and (c) the
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<PAGE> 20
waiting period, if any, applicable to the consummation of the Merger under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended (the "HSR Act")
shall have expired or been terminated.
The obligations of Parent and the Purchaser to effect the Merger are also
subject to each of the following conditions: (a) the Company and each of its
subsidiaries shall have performed in all material respects each obligation and
covenant to be performed by it under the Merger Agreement on or prior to the
Effective Time and (b) the representations and warranties of the Company set
forth in the Merger Agreement shall be true and correct except where the failure
of such representations and warranties to be so true and correct does not have a
Material Adverse Effect on the Company.
The obligation of the Company to effect the Merger is also subject to each
of the following conditions: (a) each of Parent and the Purchaser shall have
performed in all material respects each obligation to be performed by it under
the Merger Agreement on or prior to the Effective Time and (b) the
representations and warranties of Parent and the Purchaser set forth in the
Merger Agreement shall be true and correct in all material respects at and as of
the Effective Time as if made at and as of such time, except as affected by
transactions contemplated or permitted by the Merger Agreement and except to the
extent that any such representation or warranty is made as of a specified date,
in which case such representation or warranty shall have been true and correct
as of such date.
For purposes of the Merger Agreement, the term Material Adverse Effect has
been defined as a material adverse effect on (i) the business, operations,
condition (financial or otherwise), results of operations or prospects of the
Company and its subsidiaries, taken as a whole, (ii) the value, condition or
marketability of any material assets of the Company and its subsidiaries, taken
as a whole or (iii) the ability of the Company and its subsidiaries to perform
on a timely basis its obligations under any material contract or to exercise or
enforce any of its material rights, powers or remedies under any material
contract; provided, however, that the parties agree that a Material Adverse
Effect shall not be deemed to have occurred on account of any single event or
condition that results in, or is reasonably likely to result in, or any group of
events or conditions that in the aggregate result in, or are reasonably likely
to result in, a loss, cost, penalty or diminution in value in the business,
operations, condition (financial or otherwise), results of operations or
prospects of the Company and its subsidiaries that is less than $750,000; and
provided, further, that no prospective change in the business, operations,
condition (financial or otherwise), results of operations or prospects of the
Company and its subsidiaries on account of general economic conditions or local,
regional, national or international industry conditions shall be deemed to
constitute a Material Adverse Effect.
Indemnification and Insurance. From and after the earlier of the Control
Date (as defined herein) or the Effective Time, Parent shall cause the Company
to maintain all rights to indemnification now existing in favor of the current
or former directors, officers, employees, fiduciaries and agents of the Company
and its subsidiaries as provided in their respective certificates of
incorporation or bylaws, with such rights to survive the Offer and Merger and
continue in full force and effect in accordance with their respective terms for
a period of not less than six years from the Effective Time, provided, however,
that in the event any claim or claims are asserted or made within such six-year
period, all such rights shall continue until final disposition of any such claim
or claims. In addition, the Merger Agreement requires Parent, from and after the
earlier of the Control Date or the Effective Time, to cause the Company to
maintain in effect for not less than three years after the Effective Time the
current policies of directors' and officers' liability insurance maintained by
the Company and its subsidiaries (or a substitute policy providing at least the
same coverage and containing terms and conditions that are no less advantageous)
to the extent available on commercially reasonable terms; provided, that Parent
and the Company shall not be required to pay premiums for such insurance
policies in excess of 133% of the premiums currently paid by the Company; and
provided, further, that if Parent or the Company is unable to maintain or obtain
such insurance coverage as required by the Merger Agreement, the Company will
maintain or obtain, for the remainder of the three-year period, the most
favorable coverage available on commercially reasonable terms for premiums equal
to 133% of the premiums currently paid by the Company. Pursuant to the Merger
Agreement, from and after the earlier of the Control Date or the Effective Time,
Parent agrees to, and agrees to cause the Company to, indemnify, defend, hold
harmless and reimburse each current and former officer or director of the
Company or any of its subsidiaries (the "Indemnified Parties") for, from and
against all losses, claims, damages, costs, expenses (including the
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<PAGE> 21
reasonable fees and expenses of attorneys and other professional advisers),
liabilities, judgments, fines and amounts paid in settlement ("Indemnified
Liabilities") incurred directly or indirectly in connection with any threatened
or actual claim, action, suit, proceeding or investigation, whether civil,
criminal or administrative, based in whole or in part on or arising in whole or
in part out of the fact that such person is or was a director or officer of the
Company or any of its subsidiaries, or is or was serving at the request of the
Company as a director or officer of another corporation, partnership, joint
venture or other enterprise, whether pertaining to any matter occurring,
asserted or claimed prior to, on, or after the Effective Time; provided,
however, that no Indemnified Party shall be entitled to indemnification
hereunder for any wrongful misconduct of such Indemnified Party. Without
limiting the foregoing, in the event any such claim, action, suit, proceeding or
investigation is brought against any Indemnified Party (whether arising before
or after the Effective Time), upon delivery to Parent of an undertaking in the
form described in Section 145(c) of the GCL, (i) the Indemnified Parties may
retain counsel mutually satisfactory to them and Parent; (ii) Parent shall pay,
or cause the Company to pay, all reasonable fees and expenses of such counsel
for the Indemnified Parties promptly as statements therefor are received; and
(c) Parent shall use, or cause the Company to use, its best efforts to assist in
the vigorous defense of any such matter; provided, however, that neither Parent
nor the Company shall be liable for any settlement of any claim effected without
Parent's written consent, which consent, however, shall not be unreasonably
withheld. Any Indemnified Party wishing to claim indemnification under this
provision of the Merger Agreement, upon learning of any such claim, action,
suit, proceeding or investigation, shall notify Parent (but the failure so to
notify Parent shall not relieve it from any liability that it may have except to
the extent such failure materially prejudices such party), and shall deliver to
Parent the undertaking described in Section 145(e) of the GCL. The terms of the
indemnification provision of the Merger Agreement, which shall survive the
consummation of the Offer and the Merger, are intended to be for the benefit of,
and shall be enforceable by, each Indemnified Party, his heirs and his
representatives. In the event Parent, the Surviving Corporation or any of their
successors or assigns (i) merges, consolidates or combines with any other person
and shall not be the continuing or surviving corporation or entity, or (ii)
transfers all or substantially all of its properties and assets to any person,
then, and in each such case, proper provision shall be made so that the
successors and assigns of such corporation assume the obligations set forth in
the indemnification provision of the Merger Agreement. The term "Control Date"
means the earliest date on which the Company shall have elected such number of
directors designated by the Purchaser pursuant to the Merger Agreement as is
equal to at least a majority of the total number of directors on the Board of
Directors of the Company.
Termination. The Merger Agreement may be terminated and the Merger
contemplated thereby may be abandoned at any time notwithstanding approval
thereof by the stockholders of the Company, but prior to the Effective Time: (i)
by mutual written consent duly authorized by the Boards of Directors of the
Company (excluding any designee of Parent or an affiliate of Parent) and the
Purchaser and by the General Partner of Parent; (ii) by Parent or the Company
(excluding any designee of Parent or an affiliate of Parent) if the Effective
Time shall not have occurred on or before December 31, 1996; (iii) by Parent or
the Company if any federal or state court of competent jurisdiction or other
federal or state governmental body shall have issued an order, decree or ruling,
or taken any other action restraining, enjoining or otherwise prohibiting the
Offer or the Merger and such order, decree, ruling or other action shall have
become final and nonappealable; (iv) by the Company if the Offer has not been
made in accordance with the terms of the Merger Agreement; (v) by the Company if
no Shares have been purchased under the Offer on or before December 31, 1996;
(vi) by the Company if Parent or the Purchaser shall be in material breach of
any of the representations and warranties (except such breaches that are cured
prior to the expiration of the Offer) of Parent or the Purchaser set forth in
the Merger Agreement or either Parent or the Purchaser shall have failed in any
material respect to perform any material obligation or covenant (except such
failures that are cured prior to the expiration of the Offer) required by the
Merger Agreement to be performed by it; (vii) by Parent if the Company shall be
in breach of any of the representations and warranties (except such breaches
that are cured prior to the expiration of the Offer and such breaches that are
not likely to have a material adverse effect on the Company) of the Company set
forth in the Merger Agreement or the Company shall have failed in any material
respect to perform any material obligation or covenants (except such failures
that are cured prior to the expiration of the Offer and such failures that are
not likely to have a Material Adverse Effect on the Company) required by the
Merger
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Agreement to be performed by it; (viii) by Parent, (x) if the Board of Directors
or any committee thereof of the Company withdraws or modifies or amends in a
manner adverse to Parent or the Purchaser its authorization, approval or
recommendation of the Offer or the Merger or the Merger Agreement or shall have
resolved to do any of the foregoing or shall have failed to have reiterated its
recommendation within five business days of any written request by Parent or the
Purchaser therefor or (y) if the Company or any of its subsidiaries (or the
Board of Directors or any committee thereof of the Company) shall have approved,
recommended, authorized, proposed, publicly announced its intention to enter
into or filed a Schedule 14D-9 not opposing any Acquisition Transaction with a
party other than Parent, Purchaser or any of their affiliates; (ix) by Parent if
the Company or any of its subsidiaries, or any of their respective officers,
directors, employees, representatives, agents or affiliates, provides or affords
access to any non-public information regarding the Company, other than
Non-Proprietary Information (defined below), to any corporation, partnership,
person or other entity or group (other than Parent or the Purchaser or any
affiliate or associate of Parent or the Purchaser) in connection with any actual
or proposed Acquisition Transaction, whether or not permitted by the Merger
Agreement; or (x) by the Company in the event the Company has received from a
third party an unsolicited, written, bona fide proposal to engage in an
Acquisition Transaction and, as a result of such proposal, the Board of
Directors of the Company or the Independent Committee modifies, in a manner
adverse to Parent or the Purchaser, or withdraws its approval or recommendation
of, the Offer or the Merger, so long as the Board of Directors or such
committee, after consultation with and based upon the advice of outside legal
counsel, determines in good faith that failure to take any such action would be
inconsistent with the compliance by the Board of Directors or such committee
with its fiduciary duties to the stockholders of the Company under the GCL.
"Non-Proprietary Information" means (a) all reports filed by the Company with
the Commission pursuant to the Exchange Act, including the exhibits thereto, (b)
all registration statements and other documents filed by the Company with the
Commission pursuant to the Securities Act of 1933, as amended, including the
exhibits thereto and any current drafts of any registration statements not yet
filed, (c) any information regarding the Company's compliance with environmental
laws, (d) information regarding the Company's ownership of its material
properties reflected on its most recent balance sheet included in a report filed
with the SEC pursuant to the Exchange Act, and (e) any other information that
the Company and Parent may mutually agree.
In the event of any termination and abandonment of the Merger Agreement
pursuant to any of the provisions above, the Merger Agreement shall forthwith
become void and have no effect, except for the provisions pertaining to the
payment of termination expenses and fees, the parties' entitlement to an
injunction to prevent a breach of the Merger Agreement and the payment of
expenses without any liability on the part of any party or its directors,
officers, stockholders, employees, agents, consultants or representatives,
except that no party to the Merger Agreement will be relieved from liability for
any breach of the Merger Agreement.
Whether or not the Offer or Merger is consummated, all costs and expenses
incurred in connection with the Offer, the Merger Agreement and the transactions
contemplated thereby will be paid by the party incurring such costs and
expenses, provided, however, that in the event of a termination of the Merger
Agreement pursuant to sections (vii) through (x) above, and within twelve months
from the date of such termination an Acquisition Transaction is consummated
other than with Parent, the Purchaser or any of their affiliates or if a person,
entity or group other than Mr. Moity, Parent, the Purchaser or any of their
affiliates acquires more than 50% of the outstanding Shares or assets of the
Company or Mr. Moity acquires any additional Shares or assets of the Company,
the Company will pay Parent a fee equal to $3,300,000 payable in immediately
available funds on the second business day following such event. In the event
the Merger Agreement is terminated, unless such termination results solely from
a material breach by Parent or the Purchaser of their obligations under the
Merger Agreement, the Company shall promptly at such time assume and pay (in
addition to any other amounts payable), or reimburse Parent for, reasonable
documented out-of-pocket fees and expenses actually incurred by or on behalf of
Parent and Purchaser in connection with the transactions contemplated hereby,
including all legal, investment banking, accounting, printing and other fees and
expenses whether incurred prior to or following the execution of or the
termination of the Merger Agreement.
Stockholder Agreements. The following summary of the Stockholder
Agreements, copies of which are filed as exhibits to the Schedule 14D-1, is
qualified by reference to the Stockholder Agreements.
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The Parent has entered into a Stockholder Agreement with each of Randolph
M. Moity, Sr. and Kenneth J. Boutte (collectively the "Principal Stockholders"),
which grant Parent and the Purchaser certain rights with respect to their
Shares, representing in the aggregate approximately 56% of the Shares
outstanding on the date of the Merger Agreement owned by the Principal
Stockholders. The principal terms of the Stockholder Agreements are as follows.
Sale of Shares. The Stockholder Agreements provide that each Principal
Stockholder will sell to the Purchaser, and the Purchaser will purchase, all
Shares of the Principal Stockholders at a price per share equal to the price
paid for Shares in the Offer; provided that such obligation to sell and such
obligation to purchase is subject to Purchaser having accepted Shares for
payment under the Offer. The Principal Stockholder may tender Shares into the
Offer and the Purchaser may direct that the Principal Stockholder tender such
Shares. Any Shares of a Principal Stockholder not purchased in the Offer will be
purchased at the same time a payment is made under the Offer. In addition, the
Stockholder Agreement with Mr. Moity provides that the Purchaser may purchase up
to 100,000 of his Shares by delivery of a promissory note in the amount of the
purchase price therefor. The principal of this note, together with interest
accrued thereon, will be paid at the earlier of (i) the end of the primary term
of the Employment Agreement or (ii) two months following the date Mr. Moity is
replaced as the Chief Executive Officer, and amounts due under the note may be
offset against any failure by Mr. Moity to satisfy his obligations under the
Employment Agreement (as hereinafter defined).
Irrevocable Proxy. Pursuant to the terms of each Stockholder Agreement,
each of the Principal Stockholders irrevocably granted to the Parent such
individual's proxy for and in the name, place and stead of the Principal
Stockholder, to vote the Principal Stockholder's Shares, or grant a consent or
approval in respect of such Shares against any Competing Transaction (as
hereafter defined). The term "Competing Transaction" shall mean (i) any merger
agreement or merger (other than the Merger Agreement and the Merger),
consolidation, combination, sale of substantial assets, reorganization, joint
venture, recapitalization, dissolution, liquidation or winding up of or by the
Company and (ii) any amendment of the Company's Certificate of Incorporation or
By-laws or other proposal or transaction involving the Company or any of its
subsidiaries which amendment or other proposal or transaction would in any
manner impede, frustrate, prevent or nullify, or result in a breach of any
covenant, representation or warranty or of any other obligation or agreement of
the Company under or with respect to, the Offer, the Merger, the Merger
Agreement or any of the other transactions contemplated by the Merger Agreement.
Other Provisions. The Stockholder Agreements contain certain
representations and warranties, and restrict the Principal Stockholders' ability
to transfer their Shares or take any action that would in any way restrict,
limit or interfere with the performance of the Principal Stockholders'
obligations under the Stockholder Agreements the transactions contemplated
thereby. The Principal Stockholders shall not, and shall not permit any
investment banker, attorney or other adviser or representative of the Principal
Stockholders to, take any action that may lead to any takeover proposal.
Termination. The Stockholder Agreements, and all rights and obligations of
the Parent and the Principal Stockholders, shall terminate upon the first to
occur of (i) the Effective Time of the Merger or (ii) the termination of the
Merger Agreement except under certain circumstances.
Employment Agreement. Parent has asked Randolph M. Moity, Sr., a Principal
Stockholder and currently the Chairman, Chief Executive Officer and President of
the Company, to continue to serve in such position for the Company and Surviving
Corporation, with his compensation consisting of a $300,000 annual performance
bonus, until such time as a suitable replacement may be found and thereafter to
resign his position at the request of the Company. The term of Mr. Moity's
Employment Agreement will begin the date his Shares are purchased in accordance
with his Stockholder Agreement and run for a period of 18 months, which term may
be continued thereafter only if agreed to in writing by both parties. Mr. Moity
has agreed to refrain from competing, directly or indirectly, with the Surviving
Corporation and its affiliates, while employed and for two years thereafter.
During employment and for two years thereafter, Mr. Moity will not solicit away
employees or customers of the Company. The Employment Agreement will replace Mr.
Moity's current employment agreement with the Company. The foregoing is a
summary of the Employment Agreement, a
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copy of which is filed as an exhibit to the Schedule 14D-1, and is qualified by
reference to the Employment Agreement.
12. EFFECT OF THE OFFER ON THE MARKET FOR SHARES; STOCK EXCHANGE LISTING;
REGISTRATION UNDER THE EXCHANGE ACT.
The purchase of Shares pursuant to the Offer will reduce the number of
Shares that might otherwise trade publicly and the number of holders of Shares,
which could adversely affect the liquidity and market value of the remaining
Shares, if any, held by stockholders other than the Purchaser. The Purchaser
cannot predict whether the reduction in the number of Shares that might
otherwise trade publicly would have an adverse or beneficial effect on the
market price for, or marketability of, the Shares or whether such reduction
would cause future market prices to be greater or less than the Offer price.
The Shares are currently listed and traded on the NASDAQ National Market,
which constitutes the principal trading market for the Shares. Depending upon
the number of Shares purchased pursuant to the Offer, the Shares may no longer
meet the requirements for continued inclusion in the NASDAQ National Market,
which require that an issuer have at least 200,000 publicly held shares, held by
at least 400 shareholders or 300 shareholders of round lots, with a market value
of at least $1,000,000 and have net tangible assets of at least $1,000,000,
$2,000,000 or $4,000,000 depending on profitability levels during the issuer's
four most recent fiscal years. If these standards are not met, the Shares might
nevertheless continue to be included in the NASDAQ Stock Market (the "NASDAQ
Stock Market") with quotations published in the NASDAQ "additional list" or in
one of the "local lists," but if the number of holders of the Shares were to
fall below 300, or if the number of publicly held Shares were to fall below
100,000 or there were not at least two registered and active market makers for
the Shares, the NASD's rules provide that the Shares would no longer be
"qualified" for NASDAQ Stock Market reporting and the NASDAQ Stock Market would
cease to provide any quotations. Shares held directly or indirectly by
directors, officers or beneficial owners of more than 10% of the Shares are not
considered as being publicly held for this purpose. According to information
provided by the Company, as of July 1, 1996 there were approximately 53 holders
of record of Shares and 3,704,032 Shares were outstanding. If, as a result of
the purchase of Shares pursuant to the Offer or otherwise, the Shares no longer
meet the requirements for continued inclusion in the NASDAQ National Market or
in any other tier of the NASDAQ Stock Market and the Shares are no longer
included in the NASDAQ National Market or in any other tier of the NASDAQ Stock
Market, as the case may be, the market for Shares could be adversely affected.
In the event that the Shares no longer meet the requirements for continued
inclusion in any tier of the NASDAQ Stock Market, it is possible that the Shares
would continue to trade in the over-the-counter market and that price quotations
would be reported by other sources. The extent of the public market for the
Shares and the availability of such quotations would, however, depend upon the
number of holders of Shares remaining at such time, the interests in maintaining
a market in Shares on the part of securities firms, the possible termination of
registration of the Shares under the Exchange Act, as described below, and other
factors.
The Shares are currently "margin securities" under the regulations of the
Board of Governors of the Federal Reserve System (the "Federal Reserve Board"),
which has the effect, among other things, of allowing brokers to extend credit
on the collateral of the Shares. Depending upon factors similar to those
described above regarding listing and market quotations, following the Offer it
is possible that the Shares would no longer constitute "margin securities" for
the purposes of the margin regulations of the Federal Reserve Board and
therefore could no longer be used as collateral for loans made by brokers.
The Shares are currently registered under the Exchange Act. Registration of
the Shares under the Exchange Act may be terminated upon application of the
Company to the Commission if the Shares are not listed on a national securities
exchange or quoted on NASDAQ and there are fewer than 300 record holders of
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the Shares. Termination of registration of the Shares under the Exchange Act
would reduce substantially the information required to be furnished by the
Company to its stockholders and to the Commission and would make certain
provisions of the Exchange Act, such as the short-swing profit recovery
provisions of Section 16(b), the requirement of furnishing a proxy statement in
connection with stockholders' meetings pursuant to Section 14 (a) and the
requirements of Rule 13e-3 under the Exchange Act with respect to "going
private" transaction, no longer applicable to the Company. Furthermore, if the
Purchaser acquires a substantial number of Shares or the registration of the
Shares under the Exchange Act were to be terminated, 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 may be
impaired or eliminated. If registration of the Shares under the Exchange Act
were terminated prior to the consummation of the Merger, the Shares would no
longer be "margin securities" or be eligible for NASDAQ reporting. It is the
present intention of the Purchaser to seek to cause the Company to make an
application for termination of registration of the Shares as soon as possible
following the Offer if the requirements for termination of registration are met.
If registration of the Shares is not terminated prior to the Merger, then
the Shares will be delisted from the NASDAQ National Market and the registration
of the Shares under the Exchange Act will be terminated following the
consummation of the Merger.
13. DIVIDENDS AND DISTRIBUTIONS.
Pursuant to the terms of the Merger Agreement, the Company is prohibited
from taking any of the actions described in the two immediately succeeding
paragraphs, and nothing herein shall constitute a waiver by the Purchaser or
Parent of any of its rights under the Merger Agreement or a limitation of
remedies available to the Purchaser or Parent for any breach of the Merger
Agreement, including termination thereof.
If, on or after July 1, 1996, the Company should, except as permitted under
the Merger Agreement, (i) split or combine the Shares, or otherwise reclassify
or change the Shares or its capitalization, (ii) issue, sell or pledge any
Shares, shares of any other class of capital stock, other securities or any
securities convertible into or exchangeable for, or rights, warrants or options,
conditional or otherwise, to acquire, any of the foregoing (other than Shares
issued or sold upon the exercise (in accordance with the present terms thereof)
of Company Options or Warrants outstanding on July 1, 1996), or (iii) acquire or
redeem currently outstanding Shares or otherwise cause a reduction in the number
of outstanding Shares, then, without prejudice to the Purchaser's rights under
Sections 1 and 14, the Purchaser, in its sole discretion (subject to the terms
of the Merger Agreement), may make such adjustments as it deems appropriate in
the purchase price and other terms of the Offer and the Merger, including,
without limitation, the amount and type of securities offered to be purchased.
If, on or after July 1, 1996, the Company should, except as permitted under
the Merger Agreement, declare or pay any dividend on the Shares or make any
distribution (including, without limitation, the issuance of additional Shares
pursuant to a stock dividend or stock split, the issuance of other securities or
the issuance of rights, warrants or options to acquire any securities) with
respect to the Shares that is payable or distributable to stockholders of record
on a date prior to the transfer of the Shares purchased pursuant to the Offer to
the name of the Purchaser or its nominee or transferee on the Company's stock
transfer records, then, without prejudice to the Purchaser's rights under
Sections 1 and 14, (i) the purchase price per Share payable by the Purchaser
pursuant to the Offer may, in the sole discretion of Purchaser, be reduced by
the amount of any such cash dividend or cash distribution and (ii) any such
non-cash dividend, distribution or right to be received by the tendering
stockholders will (x) be received and held by the tendering stockholders for the
account of the Purchaser and will be required to be promptly remitted and
transferred by each tendering stockholder to the Depositary for the account of
the Purchaser, accompanied by appropriate documentation of transfer, or (y) at
the direction of the Purchaser, be exercised for the benefit of the Purchaser,
in which case the proceeds of such exercise will promptly be remitted to the
Purchaser. Pending such remittance and subject to applicable law, the Purchaser
will be entitled to all rights and privileges as owner of any such non-cash
dividend, distribution, right or proceeds and may withhold the entire purchase
price or deduct from the purchase price the amount or value thereof, as
determined by the Purchaser in its sole discretion.
23
<PAGE> 26
14. CONDITIONS TO THE OFFER.
Notwithstanding any other provisions of the Offer, the Purchaser shall not
be required to accept for payment, purchase or pay for any Shares tendered, and
may, subject to the terms of the Merger Agreement, amend the Offer and may
postpone the acceptance for payment of and payment for Shares, if (i) as of the
Expiration Date of the Offer, there shall not have been validly tendered and not
withdrawn pursuant to the Offer a number of Shares such that, upon consummation
of the Offer, Purchaser and its affiliates will beneficially own in the
aggregate not less than 90% of the Shares outstanding on a Fully Diluted Basis,
(ii) the applicable waiting period under the HSR Act, if any, shall not have
expired or been terminated, or (iii) at any time on or after December 31, 1996
and before the time of payment for any such Shares (whether or not any Shares
have theretofore been accepted for payment or paid for pursuant to the Offer)
any of the following conditions exist or shall occur and remain in effect:
(a) there shall have occurred and be in effect (i) any general
suspension of trading in, or limitation on prices for, securities on the
New York Stock Exchange or in the NASDAQ Stock Market which has remained in
effect for five consecutive business days, (ii) a declaration of a banking
moratorium or any suspension of payments in respect of banks in the United
States, (iii) any material limitation (whether or not mandatory) by any
governmental authority on the extension of credit by lending institutions,
or (iv) in the case of any of the foregoing existing at the time of the
commencement of the Offer a material acceleration or worsening thereof; or
(b) an order shall have been entered in any action or proceeding
before any United States federal or state court or governmental agency or
other United States regulatory or administrative agency or commission, or a
preliminary or permanent injunction by a United States court of competent
jurisdiction (collectively, a "Governmental Action") shall have been issued
and remain in effect, which would have the effect of (i) making the
purchase of, or payment for, some or all of the Shares pursuant to the
Offer or the Merger Agreement illegal, (ii) otherwise preventing
consummation of the Merger, (iii) requiring the divestiture by Parent or
any of its subsidiaries or affiliates of any Shares, or the divestiture by
Parent of all or a material portion of its business, assets or property, or
(iv) otherwise having a Material Adverse Effect (as defined in the Merger
Agreement) on Parent or the Company; provided, however, that for purposes
of this clause (b)(iv), to the extent that any order or preliminary or
permanent injunction relates to the stock purchases as contemplated by the
Stockholder Agreements, such order or injunction shall not be deemed to
have a Material Adverse Effect on either Parent or the Company; or
(c) the Merger Agreement shall have been terminated in accordance with
its terms; or
(d) the Company shall have breached in any material respect any of the
representations and warranties of the Company set forth in the Merger
Agreement (other than any matters that, in the aggregate, do not have a
Material Adverse Effect on the Company) or the Company shall have failed in
any material respect to perform any material obligation or covenant
required by the Merger Agreement to be performed or complied with by it; or
(e) there shall have occurred any event resulting in a Material
Adverse Effect on the Company; or
(f) any person (other than Parent, the Purchaser or any of their
respective affiliates or subsidiaries) acquires beneficial ownership (as
defined in Rule 13d-3 promulgated under the Exchange Act) of at least 20%
of the outstanding voting securities of the Company or is granted any
option or right to acquire at least 20% of such voting securities (as used
herein, "Person" shall include any corporation, person, partnership, trust,
other entity or group as defined in the Exchange Act); or
(g) Parent, the Purchaser and the Company shall have agreed that the
Purchaser shall terminate the Offer or postpone the payment for Shares
thereunder; or
(h) the Company shall have withdrawn, modified or amended in any
respect its recommendation of the Offer, or the Board of Directors of the
Company or any committee thereof shall have resolved to do so;
24
<PAGE> 27
which, in the sole judgment of the Parent, makes it inadvisable to proceed
with the Offer or with such acceptance for payment or payment.
The foregoing conditions are for the sole benefit of Parent and the
Purchaser and may be asserted by Parent and the Purchaser regardless of the
circumstances giving rise to any such condition. The foregoing conditions may be
waived by Parent in whole or in part at any time and from time to time in its
sole discretion. The failure by Parent or the Purchaser at any time to exercise
any of the foregoing rights will not be deemed a waiver of any right and each
right will be deemed an ongoing right which may be asserted at any time and from
time to time.
15. CERTAIN LEGAL MATTERS; REQUIRED REGULATORY APPROVALS.
Except as set forth in this Offer to Purchase, based on a review of
publicly available filings by the Company with the Commission and other publicly
available information regarding the Company, as well as certain representations
made to the Purchaser and Parent in the Merger Agreement by the Company, neither
Parent nor the Purchaser is aware of any licenses or regulatory permits that
appear to be material to the business of the Company and its subsidiaries, taken
as a whole, that might be adversely affected by the Purchaser's acquisition of
Shares (and the indirect acquisition of the stock of the Company's subsidiaries)
as contemplated herein, or any filings, approvals or other actions by or with
any domestic, foreign or supranational governmental authority or administrative
or regulatory agency that would be required for the acquisition or ownership of
the Shares (or the indirect acquisition of the stock of the Company's
subsidiaries) by the Purchaser pursuant to the Offer as contemplated herein.
Should any such approval or other action be required, it is presently
contemplated that such approval or action would be sought except as described
below under "State Takeover Laws." While, except as otherwise expressly
described in this Section 15, the Purchaser does not presently intend to delay
the acceptance for payment of or payment for Shares tendered pursuant to the
Offer pending the outcome of any such matter, there can be no assurance that any
such approval or other action, if needed, would be obtained or would be obtained
without substantial conditions or that failure to obtain any such approval or
other action might not result in consequences adverse to the Purchaser's or
Company's or its subsidiaries' businesses, or that certain parts of the
Company's, Parent's, the Purchaser's or any of their respective subsidiaries'
businesses might not have to be disposed of or held separate or other
substantial conditions complied with in order to obtain such approval or action
or in the event that such approvals were not obtained or such actions were not
taken. The Purchaser's obligation to purchase and pay for Shares is subject to
certain conditions, including conditions with respect to injunctions and
governmental actions. See the Introduction and Section 14 for a description
thereof.
State Takeover Laws. A number of states (including Delaware, where the
Company is incorporated) have adopted takeover laws and regulations that
purport, to varying degrees, to be applicable to attempts to acquire securities
of corporations that are incorporated in such states or that have substantial
assets, stockholders, principal executive offices or principal places of
business therein. In 1982, the Supreme Court of the United States, in Edgar v.
MITE Corp., invalidated on constitutional grounds the Illinois Business Takeover
Statute, which, as a matter of state securities law, made takeovers of
corporations meeting certain requirements more difficult, and the reasoning in
such decision is likely to apply to certain other state takeover statutes. In
1987, however, in CTS Corp. v. Dynamics Corp. of America, the Supreme Court of
the United States held that the State of Indiana could, as a matter of corporate
law and, in particular, those aspects of corporate law concerning corporate
governance, constitutionally disqualify a potential acquiror from voting on the
affairs of a target corporation without the prior approval of the remaining
stockholders, provided that such laws were applicable only under certain
conditions. Subsequently, in TLX Acquisition Corp. v. Telex Corp., a federal
district court in Oklahoma ruled that the Oklahoma statutes were
unconstitutional insofar as they apply to corporations incorporated outside
Oklahoma in that they would subject such corporations to inconsistent
regulations. Similarly, in Tyson Foods, Inc. v. McReynolds, a federal district
court in Tennessee ruled that four Tennessee takeover statutes were
unconstitutional as applied to corporations incorporated outside Tennessee. This
decision was affirmed by the United States Court of Appeals for the Sixth
Circuit. In December 1988, a federal district court in Florida held in Grand
Metropolitan PLC v. Butterworth that the
25
<PAGE> 28
provisions of the Florida Affiliated Transactions Act and Florida Control Share
Acquisition Act were unconstitutional as applied to corporations incorporated
outside of Florida.
Section 203 of the Delaware Law. Section 203 of the Delaware Law, in
general, prohibits a Delaware corporation such as the Company from engaging in a
"Business Combination" (defined to include a variety of transactions, including
mergers) with an "Interested Stockholder" (defined generally as a person that is
the beneficial owner of 15% or more of the corporation's outstanding voting
stock) for a period of three years following the date such person became an
Interested Stockholder unless, among other things, prior to the date such person
became an Interested Stockholder, the board of directors of the corporation
approved either the Business Combination or the transaction that resulted in the
stockholder becoming an Interested Stockholder. The Company has represented in
the Merger Agreement that it properly approved the Merger Agreement, the
Stockholder Agreements and the Purchaser's acquisition of Shares pursuant to the
Offer and the Stockholder Agreements. Therefore, Section 203 of the Delaware Law
is inapplicable to the Merger.
Neither the Purchaser nor Parent has attempted to comply with any state
takeover statutes in connection with the Offer or the Merger. The Purchaser
reserves the right to challenge the validity or applicability of any state law
allegedly applicable to the Offer or the Merger, and nothing in this Offer to
Purchase or any action taken in connection herewith is intended as a waiver of
that right. In the event that it is asserted that one or more takeover statutes
apply to the Offer or the Merger, and it is not determined by an appropriate
court that such statute or statutes do not apply or are invalid as applied to
the Offer or the Merger, as applicable, the Purchaser may be required to file
certain documents with, or receive approvals from, the relevant state
authorities, and the Purchaser might be unable to accept for payment or purchase
Shares tendered pursuant to the Offer or be delayed in continuing or
consummating the Offer or the Merger. In such case, the Purchaser may not be
obligated to accept for purchase, or pay for, any Shares tendered. See Section
14.
Antitrust. The Purchaser does not believe that the Offer and the Merger
are subject to the HSR Act, which provides that certain acquisition transactions
may not be consummated unless certain information has been furnished to the
Antitrust Division of the Department of Justice (the "Antitrust Division") and
the Federal Trade Commission ("FTC") and certain waiting period requirements
have been satisfied.
If the acquisition of Shares is delayed pursuant to a request by the FTC or
the Antitrust Division for information or documentary material pursuant to the
HSR Act, the Offer may, at the discretion of the Purchaser (subject to the terms
and conditions of the Merger Agreement) be extended and, in any event the
purchase of and payment for Shares will be deferred until the applicable waiting
period expires or is terminated. Unless the Offer is extended, any extension of
the waiting period will not give rise to any additional withdrawal rights. See
Section 4.
In practice, complying with a request for information or documentary
material can take a significant amount of time. In addition, if the Antitrust
Division or the FTC raises substantive issues in connection with a proposed
transaction, the parties frequently engage in negotiations with the relevant
governmental agency concerning possible means of addressing those issues and may
agree to delay consummation of the transaction while such negotiations continue.
The FTC and the Antitrust Division frequently scrutinize the legality under
the antitrust laws of transactions such as the Purchaser's acquisition of Shares
pursuant to the Offer and the Merger. At any time before or after the
Purchaser's acquisition 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 otherwise or seeking divestiture of Shares acquired by the
Purchaser or divestiture of substantial assets of Parent, the Company or their
respective subsidiaries. Private parties and state attorneys general may also
bring legal action under the antitrust laws under certain circumstances. Based
upon an examination of publicly available information relating to the businesses
in which Parent and the Company are engaged, Parent and the Purchaser believe
that the acquisition of Shares by the Purchaser will not violate the antitrust
laws. Nevertheless, there can be no assurance that a challenge to the Offer or
other acquisition of Shares by the Purchaser on antitrust grounds will not be
made or, if such a challenge is made, of the result. If any such action by the
FTC, the Antitrust Division or any other person should be threatened or
commenced, the Purchaser may extend, terminate or amend the Offer. See Section
26
<PAGE> 29
13. See Section 14 for certain conditions to the Offer, including conditions
with respect to injunctions and certain governmental actions.
16. FEES AND EXPENSES.
Georgeson & Company Inc. has been retained by the Purchaser as Information
Agent in connection with the Offer. The Information Agent may contact holders of
Shares by mail, telephone, telex, telegraph and personal interview and may
request brokers, dealers and other nominee stockholders to forward material
relating to the Offer to beneficial owners of Shares. The Purchaser will pay the
Information Agent reasonable and customary compensation for all such services in
addition to reimbursing the Information Agent for reasonable out-of-pocket
expenses in connection therewith. The Purchaser has agreed to indemnify the
Information Agent against certain liabilities and expenses in connection with
the Offer, including certain liabilities under the federal securities laws.
In addition, The First National Bank of Boston has been retained as the
Depositary. The Purchaser will pay the Depositary reasonable and customary
compensation for its services in connection with the Offer, will reimburse the
Depositary for its reasonable out-of-pocket expenses in connection therewith and
will indemnify the Depositary against certain liabilities and expenses in
connection therewith, including certain liabilities under the federal securities
laws.
Except as set forth above, neither Parent 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. Brokers, dealers, commercial banks and trust
companies and other nominees will, upon request, be reimbursed by Parent or the
Purchaser for customary clerical and mailing expenses incurred by them in
forwarding offering materials to their customers.
17. MISCELLANEOUS.
The Purchaser is not aware of any jurisdiction in which the making of the
Offer is not in compliance with applicable law. If the Purchaser becomes aware
of any jurisdiction in which the making of the Offer would not be in compliance
with applicable law, the Purchaser will make a good faith effort to comply with
any such law. If, after such good faith effort, the Purchaser cannot comply with
any such law, the Offer will not be made to (nor will tenders be accepted from
or on behalf of) the holders of Shares residing in such jurisdiction. In those
jurisdictions whose securities or blue sky laws require the Offer to be made by
a licensed broker or dealer, the Offer is being made on behalf of the Purchaser
by one or more registered brokers or dealers which are licensed under the laws
of such jurisdiction.
No person has been authorized to give any information or make any
representation on behalf of the Purchaser or Parent not contained in this Offer
to Purchase or in the Letter of Transmittal and, if given or made, such
information or representation must not be relied upon as having been authorized.
The Purchaser and Parent have filed with the Commission the Schedule 14D-1
pursuant to Rule 14d-3 under the Exchange Act, furnishing certain additional
information with respect to the Offer, and may file amendments thereto. The
Schedule 14D-1 and any amendments thereto, including exhibits, may be inspected
and copies may be obtained at the same places and in the same manner as set
forth in Section 7 (except that they will not be available at the regional
offices of the Commission).
AI ACQUISITIONS CORP.
27
<PAGE> 30
SCHEDULE I
CERTAIN INFORMATION CONCERNING
THE BEACON GROUP, PARENT
AND THE PURCHASER
1. DIRECTORS AND EXECUTIVE OFFICERS OF THE PURCHASER.
The following table sets forth the name, present principal occupation or
employment and material occupations, positions, offices or employments for the
past five years of each director and executive officer of the Purchaser all of
whom are citizens of the United States except for Eric R. Wilkinson who is a
citizen of the United Kingdom. Unless otherwise indicated, the address of each
entity listed and the business address of each person is c/o The Beacon Group,
375 Park Avenue, Suite 1705, New York, New York 10152.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS
NAME TITLE HELD DURING THE PAST FIVE YEARS
- ----------------------------- ----------------------------- ---------------------------------
<S> <C> <C>
Geoffrey T. Boisi............ President and Managing See "The Beacon Group," infra.
Director
Richard W. Herbst............ Managing Director See "The Beacon Group," infra.
John J. MacWilliams.......... Managing Director See "The Beacon Group," infra.
Thomas G. Mendell............ Managing Director See "The Beacon Group," infra.
Preston R. Miller, Jr. ...... Managing Director See "The Beacon Group," infra.
Harold W. Pote............... Managing Director See "The Beacon Group," infra.
David F. Remington........... Managing Director See "The Beacon Group," infra.
Faith Rosenfeld.............. Managing Director See "The Beacon Group," infra.
and Assistant Secretary
Robert F. Semmens............ Secretary and Managing See "The Beacon Group," infra.
Director
Eric R. Wilkinson............ Managing Director See "The Beacon Group," infra.
</TABLE>
2. GENERAL PARTNER OF THE PARENT.
The following table sets forth the name, present principal occupation or
employment and material occupations, positions, offices or employments for the
past five years of the general partner of Parent, which general partner is a
partnership organized in the United States. Unless otherwise indicated, the
business address of each such person is c/o The Beacon Group, 375 Park Avenue,
Suite 1705, New York, New York 10152.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS
NAME TITLE HELD DURING THE PAST FIVE YEARS
- ----------------------------- ----------------------------- ---------------------------------
<S> <C> <C>
AI-GP, L.L.C. ............... General Partner See "The Beacon Group," infra.
</TABLE>
3. MEMBER OF AI-GP, L.L.C.
The following table sets forth the name, present principal occupation or
employment and material occupations, positions, offices or employments for the
past five years of the sole member of AI-GP, L.L.C., which sole member is a
corporation organized in the United States. Unless otherwise indicated, the
business address of such person is c/o The Beacon Group, 375 Park Avenue, Suite
1705, New York, New York 10152.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS
NAME TITLE HELD DURING THE PAST FIVE YEARS
- ----------------------------- ----------------------------- ---------------------------------
<S> <C> <C>
Energy Fund GP, Inc.......... Member See "The Beacon Group," infra.
</TABLE>
I-1
<PAGE> 31
4. DIRECTORS AND EXECUTIVE OFFICERS OF ENERGY FUND GP, INC.
The following table sets forth the name, present principal occupation or
employment and material occupations, positions, offices or employments for the
past five years of each director and executive officer of Energy Fund GP, Inc.,
all of whom are citizens of the United States except for Eric R. Wilkinson who
is a citizen of the United Kingdom. The sole stockholder of Energy Fund GP, Inc.
is The Beacon Group Holdings, L.L.C., a limited liability company organized in
the United States. Unless otherwise indicated, the business address of each such
person is c/o The Beacon Group, 375 Park Avenue, Suite 1705, New York, New York
10152.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS
NAME TITLE HELD DURING THE PAST FIVE YEARS
- ----------------------------- ----------------------------- ---------------------------------
<S> <C> <C>
Geoffrey T. Boisi............ President and Managing See "The Beacon Group," infra.
Director
Richard W. Herbst............ Managing Director See "The Beacon Group," infra.
John J. MacWilliams.......... Secretary and Managing See "The Beacon Group," infra.
Director
Thomas G. Mendell............ Managing Director See "The Beacon Group," infra.
Preston R. Miller, Jr. ...... Managing Director See "The Beacon Group," infra.
Harold W. Pote............... Managing Director See "The Beacon Group," infra.
David F. Remington........... Managing Director See "The Beacon Group," infra.
Faith Rosenfeld.............. Managing Director See "The Beacon Group," infra.
Robert F. Semmens............ Managing Director See "The Beacon Group," infra.
Eric R. Wilkinson............ Managing Director See "The Beacon Group," infra.
</TABLE>
5. SOLE MEMBER OF THE BEACON GROUP HOLDINGS, L.L.C.
The following table sets forth the name, present principal occupation or
employment and material occupations, positions, offices or employments for the
past five years of the sole member of The Beacon Group Holdings, L.L.C., which
sole member is a partnership organized in the United States. Unless otherwise
indicated, the business address of each such person is c/o The Beacon Group, 375
Park Avenue, Suite 1705, New York, New York 10152.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR
EMPLOYMENT; MATERIAL POSITIONS
NAME TITLE HELD DURING THE PAST FIVE YEARS
- ----------------------------- ----------------------------- ---------------------------------
<S> <C> <C>
The Beacon Group............. Member See "The Beacon Group," infra.
</TABLE>
I-2
<PAGE> 32
6. GENERAL PARTNERS OF THE BEACON GROUP.
The following table sets forth the name, present principal occupation or
employment and material occupations, positions, offices or employments for the
past five years of the general partners of The Beacon Group, all of whom are
citizens of the United States, except for Eric R. Wilkinson who is a citizen of
the United Kingdom. The Beacon Group is a general partnership and is the sole
member of The Beacon Group Holdings, L.L.C. Unless otherwise indicated, the
business address of each such person is c/o The Beacon Group, 375 Park Avenue,
Suite 1705, New York, New York 10152.
<TABLE>
<CAPTION>
PRESENT PRINCIPAL OCCUPATION OR EMPLOYMENT;
NAME MATERIAL POSITIONS HELD DURING THE PAST FIVE
- ----------------------------------- --------------------------------------------------------
<S> <C>
Geoffrey T. Boisi.................. Senior Partner, The Beacon Group; Partner of Goldman,
Sachs & Co. from 1978 to 1992.
Richard W. Herbst.................. General Partner, The Beacon Group; Partner of Goldman,
Sachs & Co. from 1986 to 1995.
John J. MacWilliams................ General Partner, The Beacon Group; Executive Director of
Goldman, Sachs International from 1991 to 1993.
Thomas G. Mendell.................. General Partner, The Beacon Group; Partner of Goldman,
Sachs & Co. from 1986 to 1994.
Preston R. Miller, Jr. ............ General Partner, The Beacon Group; Vice President of
Goldman, Sachs & Co. from 1980 to 1993.
Harold W. Pote..................... General Partner, The Beacon Group from 1990 to present;
President and CEO of the Brooke Group, Inc. from 1991 to
1993; Vice Chairman of PBS Properties, Inc. from 1990 to
1993.
David F. Remington................. General Partner, The Beacon Group; Self-employed from
1990 to 1993.
Faith Rosenfeld.................... General Partner, The Beacon Group; Vice President of
Goldman, Sachs & Co. from 1981 to 1993.
Robert F. Semmens.................. General Partner, The Beacon Group; Vice President of
Goldman, Sachs & Co. from 1983 to 1993.
Eric R. Wilkinson.................. General Partner, The Beacon Group; Partner of Apax
Partners & Cie S.A. from 1989 to 1994.
</TABLE>
I-3
<PAGE> 33
Facsimile copies of the Letter of Transmittal, properly completed and duly
executed, will be accepted. The Letter of Transmittal, certificates for Shares
and any other required documents should be sent or delivered by each stockholder
of the Company or his broker, dealer, commercial bank or other nominee to the
Depositary at one of its addresses set forth below.
The Depositary for the Offer is:
THE FIRST NATIONAL BANK OF BOSTON
<TABLE>
<S> <C> <C>
By Mail: By Facsimile Transmission: By Hand:
Shareholder Services Division (617) 575-2232 BancBoston Trust Company
P.O. Box 1889 (617) 575-2233 of New York
Mail Stop 45-02-53 (For Eligible Institutions Only) 55 Broadway, Third Floor
Boston, Massachusetts 02105 New York, New York
(617) 575-3120
Confirm Facsimile by Telephone: By Overnight Courier:
(617) 575-3120 The First National Bank of Boston
(For Confirmation Only) Shareholder Services Division
150 Royall Street
Mail Stop: 45-02-53
Canton, Massachusetts 02021
</TABLE>
Any questions or requests for assistance or additional copies of this Offer
to Purchase, the Letter of Transmittal or the Notice of Guaranteed Delivery may
be directed to the Information Agent at its telephone number and location listed
below. You may also contact your broker, dealer, commercial bank or trust
company or nominee for assistance concerning the Offer.
The Information Agent for the Offer is:
(GEORGESON & COMPANY, INC. LOGO)
Wall Street Plaza
New York, New York 10005
Banks and Brokers Call Collect (212) 440-9800
Call Toll-Free: (800) 223-2064
<PAGE> 1
LETTER OF TRANSMITTAL
TO TENDER SHARES
OF
COMMON STOCK
OF
AMBAR, INC.
PURSUANT TO THE OFFER TO PURCHASE DATED JULY 9, 1996
BY
AI ACQUISITIONS CORP.
A CORPORATION FORMED BY
THE BEACON GROUP
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT,
NEW YORK CITY TIME, ON MONDAY, AUGUST 5, 1996, UNLESS THE OFFER IS EXTENDED
The Depositary for the Offer is:
THE FIRST NATIONAL BANK OF BOSTON
<TABLE>
<S> <C> <C>
By Mail: By Facsimile Transmission: By Hand:
Shareholder Services Division (617) 575-2232 BancBoston Trust Company
P.O. Box 1889 (617) 575-2233 of New York
Mail Stop 45-02-53 (For Eligible Institutions 55 Broadway, Third Floor
Boston, Massachusetts 02105 Only) New York, New York
(617) 575-3120
Confirm Facsimile by Telephone: By Overnight Courier:
(617) 575-3120 The First National Bank of
(For Confirmation Only) Boston
Shareholder Services Division
150 Royall Street
Mail Stop: 45-02-53
Canton, Massachusetts 02021
</TABLE>
DELIVERY OF THIS LETTER OF TRANSMITTAL TO AN ADDRESS OTHER THAN AS SET
FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA FACSIMILE TRANSMISSION TO A
NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
THE INSTRUCTIONS ACCOMPANYING THIS LETTER OF TRANSMITTAL SHOULD BE READ
CAREFULLY BEFORE THIS LETTER OF TRANSMITTAL IS COMPLETED.
This Letter of Transmittal is to be completed by stockholders if
certificates for Shares (as defined in the Offer to Purchase, dated July 9, 1996
(the "Offer to Purchase")) are to be forwarded herewith or, unless an Agent's
Message (as defined in the Offer to Purchase) is utilized, if tenders of shares
are made by book-entry transfer to an account maintained by The First National
Bank of Boston (the "Depositary") at The Depository Trust Company ("DTC"),
Midwest Securities Trust Company ("MSTC") or Philadelphia Depository Trust
Company ("PDTC") (each a "Book-Entry Transfer Facility" and collectively
referred to as the "Book-Entry Transfer Facilities"), pursuant to the procedures
set forth in Section 3 of the Offer to Purchase. Stockholders who tender Shares
by book-entry transfer are referred to herein as "Book-Entry Stockholders".
Holders of Shares whose certificates for such Shares (the "Share
Certificates") are not immediately available, or who cannot deliver their Share
Certificates and all other required documents to the Depositary on or prior to
the Expiration Date (as defined in the Offer to Purchase), must tender their
Shares according to the guaranteed delivery procedures set forth in Section 3 of
the Offer to Purchase. See Instruction 2.
NOTE: SIGNATURES MUST BE PROVIDED ON THE INSIDE AND REVERSE BACK COVER.
PLEASE READ THE ACCOMPANYING INSTRUCTIONS CAREFULLY.
<PAGE> 2
/ / CHECK HERE IF TENDERED COMMON SHARES ARE BEING DELIVERED BY BOOK-ENTRY
TRANSFER TO THE DEPOSITARY'S ACCOUNT AT ONE OF THE BOOK-ENTRY TRANSFER
FACILITIES AND COMPLETE THE FOLLOWING:
Name of Tendering Institution:
Check Box of Book-Entry Transfer Facility:
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
Account No. Transaction Code No.
/ / CHECK HERE IF SHARES ARE BEING DELIVERED PURSUANT TO A NOTICE OF GUARANTEED
DELIVERY PREVIOUSLY SENT TO THE DEPOSITARY AND COMPLETE THE FOLLOWING.
PLEASE ENCLOSE A PHOTOCOPY OF SUCH NOTICE OF GUARANTEED DELIVERY.
Name(s) of Registered Holder(s):
Window Ticket Number (if any):
Date of Execution of Notice of Guaranteed Delivery:
Name of Institution which Guaranteed Delivery:
If delivered by book-entry transfer, check box of Applicable
Book-Entry Transfer Facility:
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
Account No. Transaction Code No.
<TABLE>
<S> <C> <C> <C>
- ------------------------------------------------------------------------------------------------
DESCRIPTION OF SHARES TENDERED
- ------------------------------------------------------------------------------------------------
NAME(S) AND ADDRESS(ES) OF REGISTERED HOLDER(S) SHARE CERTIFICATE(S) AND
(PLEASE FILL IN, IF BLANK, EXACTLY AS NAME(S) SHARE(S) TENDERED
APPEAR(S) ON SHARE CERTIFICATE(S) (ATTACH ADDITIONAL LIST, IF NECESSARY)
- ------------------------------------------------------------------------------------------------
TOTAL NUMBER
OF SHARES
SHARE REPRESENTED NUMBER OF
CERTIFICATE BY SHARE SHARES
NUMBER(S)* CERTIFICATE(S)* TENDERED**
- ------------------------------------------------------------------------------------------------
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
-----------------------------------------------
Total Shares
- ------------------------------------------------------------------------------------------------
- ------------------------------------------------------------------------------------------------
* Need not be completed by Book-Entry Stockholders.
** Unless otherwise indicated, it will be assumed that all Shares represented by certificates
delivered to the Depositary are being tendered. See Instruction 4.
- ------------------------------------------------------------------------------------------------
</TABLE>
<PAGE> 3
LADIES AND GENTLEMEN:
The undersigned hereby tenders to AI Acquisitions Corp. (the "Purchaser"),
a Delaware corporation formed by The Beacon Group, a New York partnership, the
described shares of Common Stock, par value $.01 per share (the "Shares"), of
AMBAR, Inc., a Delaware corporation (the "Company"), at a price of $18 per
Share, net to the seller in cash, without interest thereon, upon the terms and
subject to the conditions set forth in the Offer to Purchase, dated July 9, 1996
(the "Offer to Purchase"), receipt of which is hereby acknowledged, and in this
Letter of Transmittal (which together with the Offer to Purchase constitute the
"Offer"). The undersigned understands that the Purchaser reserves the right to
transfer or assign, in whole or from time to time in part, to AI Partners L.P.
("Parent"), a Delaware limited partnership that owns all of the outstanding
capital stock of Purchaser, or one or more of Parent's subsidiaries or
affiliates, the right to purchase all or any portion of the Shares tendered
pursuant to the Offer.
Subject to, and effective upon, acceptance for payment of and payment for
the Shares tendered herewith in accordance with the terms and subject to the
conditions of the Offer (including, if the Offer is extended or amended, the
terms and conditions of such extension or amendment), the undersigned hereby
sells, assigns and transfers to, or upon the order of, the Purchaser all right,
title and interest in and to all of the Shares that are being tendered hereby
and any and all dividends on the Shares or any distribution (including, without
limitation, the issuance of additional Shares pursuant to a stock dividend or
stock split, the issuance of other securities or the issuance of rights for the
purchase of any securities) with respect to the Shares that is declared or paid
by the Company on or after July 2, 1996 and is payable or distributable to
stockholders of record on a date prior to the transfer into the name of the
Purchaser or its nominees or transferees on the Company's stock transfer records
of the Shares purchased pursuant to the Offer (a "Distribution"), and
constitutes and irrevocably appoints the Depositary the true and lawful agent,
attorney-in-fact and proxy of the undersigned to the full extent of the
undersigned's rights with respect to such Shares (and any Distributions) with
full power of substitution (such power of attorney and proxy being deemed to be
an irrevocable power coupled with an interest), to (i) deliver Share
Certificates (and any Distributions) or transfer ownership of such Shares on the
account books maintained by the Book-Entry Transfer Facilities, together in
either such case with all accompanying evidences of transfer and authenticity,
to or upon the order of the Purchaser upon receipt by the Depositary, as the
undersigned's agent, of the purchase price, (ii) present Shares (and any
Distributions) for transfer on the books of the Company and (iii) receive all
benefits and otherwise exercise all rights of beneficial ownership of Shares
(and any Distributions), all in accordance with the terms and subject to the
conditions of the Offer.
The undersigned hereby irrevocably appoints Robert F. Semmens, Harold W.
Pote and Faith Rosenfeld and each of them individually, the attorneys-in-fact
and proxies of the undersigned, each with full power of substitution, to vote in
such manner as each such attorney and proxy or his or her substitute shall, in
his or her sole discretion, deem proper, and otherwise act (including pursuant
to written consent) with respect to all of the Shares tendered hereby which have
been accepted for payment by the Purchaser prior to the time of such vote or
action (and any Distributions) which the undersigned is entitled to vote at any
meeting of stockholders (whether annual or special and whether or not an
adjourned or postponed meeting) of the Company, or by consent in lieu of such
meeting, or otherwise. This power of attorney and proxy is coupled with an
interest in the tendered Shares and is irrevocable and is granted in
consideration of, and is effective upon, the acceptance for payment of such
Shares by the Purchaser in accordance with the terms of the Offer. Such
acceptance for payment shall revoke, without further action, any other power of
attorney or proxy granted by the undersigned at any time with respect to the
Shares (and any Distributions) and no subsequent powers of attorney or proxies
will be given (and if given will be deemed not to be effective) with respect
thereto by the undersigned. The undersigned understands that the Purchaser
reserves the right to require that, in order for Shares to be deemed validly
tendered, immediately upon the Purchaser's acceptance for payment of such
Shares, the Purchaser or its designees is able to exercise full voting rights
with respect to such Shares and other securities, including voting at any
meeting of stockholders.
The undersigned hereby represents and warrants that the undersigned has
full power and authority to tender, sell, assign and transfer the Shares
tendered hereby (and any Distributions) and that, when the same
<PAGE> 4
are accepted for payment by the Purchaser, the Purchaser will acquire good,
marketable and unencumbered title thereto, free and clear of all liens,
restrictions, charges, security interests and encumbrances and the same will not
be subject to any adverse claim. The undersigned, upon request, will execute and
deliver all additional documents deemed by the Depositary or the Purchaser to be
necessary or desirable to complete the sale, assignment and transfer of the
Shares tendered hereby (and any Distributions). In addition, the undersigned
shall promptly remit and transfer to the Depositary for the account of the
Purchaser any and all other Distributions in respect of the Shares tendered
hereby, accompanied by appropriate documentation of transfer and, pending such
remittance or appropriate assurance thereof, the Purchaser shall be entitled to
all rights and privileges as owner of any such Distributions, and may withhold
the entire purchase price or deduct from the purchase price of Shares tendered
hereby the amount or value thereof, as determined by the Purchaser in its sole
discretion.
All authority herein conferred or herein agreed to be conferred shall not
be affected by, and shall survive, the death or incapacity of the undersigned
and any obligation of the undersigned hereunder shall be binding upon the heirs,
executors, administrators, legal representatives, successors and assigns of the
undersigned. Except as stated in the Offer to Purchase, this tender is
irrevocable.
The undersigned understands that tenders of Shares pursuant to any one of
the procedures described in Section 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.
Unless otherwise indicated herein under "Special Payment Instructions,"
please issue the check for the purchase price and/or return any Share
Certificates not tendered or accepted for payment in the name(s) of the
undersigned. Similarly, unless otherwise indicated under "Special Delivery
Instructions," please mail the check for the purchase price and/or return any
Share Certificates not tendered or accepted for payment (and accompanying
documents, as appropriate) to the undersigned at the address shown below the
undersigned's signature. In the event that either or both the "Special Delivery
Instructions" and the "Special Payment Instructions" are completed, please issue
the check for the purchase price and/or return any Share Certificates to, the
person or persons so indicated. The undersigned recognizes that the Purchaser
has no obligation pursuant to the "Special Payment Instructions" to transfer any
Shares from the name of the registered holder thereof if the Purchaser does not
accept for payment any of such Shares.
<PAGE> 5
---------------------------------------------------------------
SPECIAL PAYMENT INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if Share Certificates not tendered or not purchased
and/or the check for the purchase price of Shares purchased are to be
issued in the name of someone other than the undersigned.
Issue check and/or certificates to:
Name: --------------------------------------------------------------------
(PLEASE PRINT)
Address: -----------------------------------------------------------------
---------------------------------------------------------------
---------------------------------------------------------------
(INCLUDE ZIP CODE)
---------------------------------------------------------------
(TAXPAYER IDENTIFICATION OR SOCIAL SECURITY NUMBER)
(SEE SUBSTITUTE FORM W-9 BELOW)
---------------------------------------------------------------
---------------------------------------------------------------
SPECIAL DELIVERY INSTRUCTIONS
(SEE INSTRUCTIONS 1, 5, 6 AND 7)
To be completed ONLY if Share Certificates not tendered or not purchased
and/or the check for the purchase price of Shares purchased are to be sent
to someone other than the undersigned, or to the undersigned at an address
other than that shown on the front cover.
Mail check and/or certificates to:
Name: --------------------------------------------------------------------
(PLEASE PRINT)
Address: -----------------------------------------------------------------
---------------------------------------------------------------
---------------------------------------------------------------
(INCLUDE ZIP CODE)
---------------------------------------------------------------
(TAXPAYER IDENTIFICATION OR SOCIAL SECURITY NUMBER)
---------------------------------------------------------------
<PAGE> 6
- --------------------------------------------------------------------------------
SIGN HERE SIGN
(PLEASE COMPLETE SUBSTITUTE FORM W-9 BELOW) HERE
X
-------------------------------------------------------------------
X
------------------------------------------------------
(SIGNATURE(S) OF OWNER(S))
Dated:
------------------------------------------------------
(Must be signed by the registered holder(s) exactly as
name(s) appear(s) on the Share Certificate(s) or on a
security position listing or by person(s) authorized
to become registered holder(s) by certificates and
documents transmitted herewith. If signature is by
trustees, executors, administrators, guardians,
attorneys-in-fact, officers of corporations or others
acting in a fiduciary or representative capacity,
please provide the following information. See
Instruction 5.)
Name(s):----------------------------------------------
------------------------------------------------------
(PLEASE PRINT)
Capacity (Full Title):
------------------------------------------------------
Address:
------------------------------------------------------
------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number:
------------------------------------------------------
Tax Identification or Social Security No.:
------------------------------------------------------
(SEE SUBSTITUTE FORM W-9 BELOW)
GUARANTEE OF SIGNATURE(S)
(IF REQUIRED -- SEE INSTRUCTIONS 1 AND 5)
Authorized Signature(s):
------------------------------------------------------
Name:
------------------------------------------------------
Name of Firm:
------------------------------------------------------
Address:
------------------------------------------------------
------------------------------------------------------
------------------------------------------------------
(INCLUDE ZIP CODE)
Area Code and Telephone Number:
------------------------------------------------------
Dated:
------------------------------------------------------
- --------------------------------------------------------------------------------
<PAGE> 7
INSTRUCTIONS
FORMING PART OF THE TERMS AND CONDITIONS OF THE OFFER
1. GUARANTEE OF SIGNATURES. No signature guarantee on this Letter of
Transmittal is required (a) if this Letter of Transmittal is signed by the
registered holder of the Shares tendered herewith, unless such holder has
completed either the box entitled "Special Delivery Instructions" or the box
entitled "Special Payment Instructions" or (b) if such Shares are tendered for
the account of a bank or trust company in the United States or by a firm that is
a member of the National Association of Securities Dealers, Inc. or of a
registered national securities exchange (an "Eligible Institution"). In all
other cases, all signatures on this Letter of Transmittal must be guaranteed by
a financial institution which is a participant in the Securities Transfer Agents
Medallion Program, the New York Stock Exchange Medallion Signature Program or
the Stock Exchange Medallion Program. See Instruction 5.
2. DELIVERY OF LETTER OF TRANSMITTAL AND CERTIFICATES. This Letter of
Transmittal is to be used if Share Certificates are to be forwarded herewith or,
unless an Agent's Message is utilized, if tenders are to be made pursuant to the
procedures for tender by book-entry transfer set forth in Section 3 of the Offer
to Purchase. Share Certificates, or timely confirmation (a "Book-Entry
Confirmation") of a book-entry transfer of such Shares into the Depositary's
account at a Book-Entry Transfer Facility, as well as this Letter of Transmittal
(or a facsimile hereof), properly completed and duly executed, with any required
signature guarantees, or an Agent's Message (as defined in the Offer to
Purchase) in connection with a book-entry transfer, and any other documents
required by this Letter of Transmittal, must be received by the Depositary at
one of its addresses set forth herein prior to the Expiration Date and, if
later, stockholders who cannot deliver their Share Certificates and all other
required documents to the Depositary prior to the Expiration Date or who cannot
complete the procedures for delivery by book-entry transfer on a timely basis
must tender their Shares by properly completing and duly executing a Notice of
Guaranteed Delivery pursuant to the guaranteed delivery procedures 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 made
available by the Purchaser, must be received by the Depositary on or prior to
the Expiration Date; and (c) the Share Certificates (or a Book-Entry
Confirmation) representing all tendered Shares, in proper form for transfer
together with a properly completed and duly executed Letter of Transmittal (or a
facsimile hereof), with any required signature guarantees (or, in the case of a
book-entry transfer, an Agent's Message) and any other documents required by
this Letter of Transmittal, must be received by the Depositary within three
NASDAQ National Market ("NNM") trading days after the date of execution of such
Notice of Guaranteed Delivery as provided in Section 3 of the Offer to Purchase.
If Share Certificates are forwarded separately to the Depositary, a properly
completed and duly executed Letter of Transmittal (or facsimile hereof) must
accompany each such delivery.
THE METHOD OF DELIVERY OF SHARE CERTIFICATES, THIS LETTER OF TRANSMITTAL
AND ALL OTHER REQUIRED DOCUMENTS IS AT THE OPTION AND SOLE RISK OF THE TENDERING
STOCKHOLDER, AND THE DELIVERY WILL BE DEEMED MADE ONLY WHEN ACTUALLY RECEIVED BY
THE DEPOSITARY. IF DELIVERY IS BY MAIL, REGISTERED MAIL WITH RETURN RECEIPT
REQUESTED, PROPERLY INSURED, IS RECOMMENDED. IN ALL CASES, SUFFICIENT TIME
SHOULD BE ALLOWED TO ENSURE TIMELY DELIVERY.
No alternative, conditional or contingent tenders will be accepted. All
tendering stockholders, by execution of this Letter of Transmittal or facsimile
hereof, waive any right to receive any notice of the acceptance of their Shares
for payment.
3. INADEQUATE SPACE. If the space provided herein under "Description of
Shares Tendered" is inadequate, the certificate numbers and/or the number of
Shares and any other required information should be listed on a separate
schedule attached hereto and separately signed on each page thereof in the same
manner as this Letter of Transmittal is signed.
<PAGE> 8
4. PARTIAL TENDERS (NOT APPLICABLE TO STOCKHOLDERS WHO TENDER BY BOOK-ENTRY
TRANSFER). If fewer than all the Shares evidenced by any certificate submitted
are to be tendered, fill in the number of Shares which are to be tendered in the
box entitled "Number of Shares Tendered." In such case, new certificate(s) for
the remainder of the Shares that were evidenced by your old certificate(s) will
be sent to you, unless otherwise provided in the appropriate box marked "Special
Payment Instructions" and/or "Special Delivery Instructions" on this Letter of
Transmittal, as soon as practicable after the Expiration Date. All Shares
represented by certificates delivered to the Depositary will be deemed to have
been tendered unless otherwise indicated.
5. SIGNATURES ON LETTER OF TRANSMITTAL, STOCK POWERS AND ENDORSEMENTS. If
this Letter of Transmittal is signed by the registered holder(s) of the Shares
tendered hereby, the signature(s) must correspond exactly with the name(s) as
written on the face of the certificate(s) without alteration, enlargement or 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 trustees, executors, administrators, guardians, attorneys-in-fact,
officers of corporations or others acting in a fiduciary or representative
capacity, such persons should so indicate when signing, and proper evidence
satisfactory to the Purchaser of their authority so to act must be submitted.
If this Letter of Transmittal is signed by the registered holder(s) of the
Shares listed and transmitted hereby, no endorsements of Share Certificates or
separate stock powers are required unless payment is to be made to, or
certificates for Shares not tendered or purchased are to be issued in the name
of, a person other than the registered holder(s). Signatures on such Share
Certificates or stock powers must be guaranteed by an Eligible Institution.
If this Letter of Transmittal is signed by a person other than the
registered holder(s) of the Shares listed, the Share Certificates must be
endorsed or accompanied by appropriate stock powers, in either case signed
exactly as the name or names of the registered holder(s) appear(s) on the
certificates. Signatures on such Share Certificates or stock powers must be
guaranteed by an Eligible Institution.
6. STOCK TRANSFER TAXES. Except as set forth in this Instruction 6, the
Purchaser will pay or cause to be paid any stock transfer taxes with respect to
the transfer and sale of purchased 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 purchased are to be registered in the
name of, any person other than the registered holder, or if tendered Share
Certificates are registered in the name of any person other than the person(s)
signing this Letter of Transmittal, the amount of any stock transfer taxes
(whether imposed on the registered holder or such person) payable on account of
the transfer to such person will be deducted from the purchase price unless
satisfactory evidence of the payment of such taxes or 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 SHARE 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 unpurchased Shares 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 Share Certificates are to be returned to someone other than
the signer of this Letter of Transmittal or to an address other than that shown
on the front cover hereof, the appropriate boxes on this Letter of Transmittal
should be completed. See Instruction 1.
<PAGE> 9
8. REQUESTS FOR ASSISTANCE OR ADDITIONAL COPIES. Questions and requests
for assistance may be directed to the Information Agent at its address or
telephone number set forth below. Requests for additional copies of the Offer to
Purchase and this Letter of Transmittal may be directed to Georgeson & Company
Inc., the Information Agent for the offer, or to brokers, dealers, commercial
banks or trust companies.
9. 31% BACKUP WITHHOLDING; SUBSTITUTE FORM W-9. Under U.S. Federal income
tax law, a stockholder whose tendered Shares are accepted for payment is
required to provide the Depositary with such stockholder's correct taxpayer
identification number ("TIN") on Substitute Form W-9 below. If the Depositary is
not provided with the correct TIN, the Internal Revenue Service may subject the
stockholder or other payee to a $50 penalty. In addition, payments that are made
to such stockholder or other payee with respect to Shares purchased pursuant to
the Offer may be subject to 31% backup withholding.
Certain stockholders (including, among others, all corporations and certain
foreign individuals) are not subject to these backup withholding and reporting
requirements. In order for a foreign individual to qualify as an exempt
recipient, the stockholder must submit a Form W-8, signed under penalties of
perjury, attesting to that individual's exempt status. A Form W-8 can be
obtained from the Depositary. See the enclosed "Guidelines for Certification of
Taxpayer Identification Number on Substitute Form W-9" for more instructions.
If backup withholding applies, the Depositary is required to withhold 31%
of any such payments made to the stockholder or other payee. Backup withholding
is not an additional tax. Rather, the tax liability of persons subject to backup
withholding will be reduced by the amount of tax withheld. If withholding
results in an overpayment of taxes, a refund may be obtained from the Internal
Revenue Service.
The stockholder is required to give the Depositary the TIN (e.g., social
security number or employer identification number) of the record owner of the
Shares or of the last transferee appearing on the transfers attached to, or
endorsed on, the Shares. If the Shares are in more than one name or are not in
the name of the actual owner, consult the enclosed "Guidelines for Certification
of Taxpayer Identification Number on Substitute Form W-9" for additional
guidance on which number to report.
10. LOST, DESTROYED OR STOLEN CERTIFICATES. If any certificate(s)
representing Shares has (have) been lost, destroyed or stolen, the stockholder
should promptly notify the Transfer Agent for the Company, American Stock
Transfer & Trust Company. The stockholder will then be instructed as to the
steps that must be taken in order to replace the certificate(s). This Letter of
Transmittal and related documents cannot be processed until the procedures for
replacing lost or destroyed certificates have been followed.
IMPORTANT: THIS LETTER OF TRANSMITTAL (OR A FACSIMILE COPY HEREOF) OR AN
AGENT'S MESSAGE TOGETHER WITH SHARE CERTIFICATES OR CONFIRMATION OF BOOK-ENTRY
TRANSFER AND ALL OTHER REQUIRED DOCUMENTS MUST BE RECEIVED BY THE DEPOSITARY ON
OR PRIOR TO THE EXPIRATION DATE.
<PAGE> 10
TO BE COMPLETED BY ALL TENDERING STOCKHOLDERS
(SEE INSTRUCTION 9)
<TABLE>
<S> <C> <C>
- ------------------------------------------------------------------------------------------------------------------
PAYER'S NAME: The First National Bank of Boston
- ------------------------------------------------------------------------------------------------------------------
Part 1--PLEASE PROVIDE YOUR TIN IN THE BOX AT
RIGHT AND CERTIFY BY SIGNING AND DATING ----------------------------------------
BELOW. Social Security Number
or
----------------------------------------
Employer Identification Number
---------------------------------------------------------------------------------------
Part 2--Certification--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 (the
"IRS") that I am subject to backup withholding as a result of a failure to report
all interest or dividends, or (c) the IRS has notified me that I am no longer
subject to backup withholding.
Certification Instructions--You must cross out item (2) above if you have been notified
by the IRS that you are currently subject to backup withholding because of
under-reporting interest or dividends on your tax return. However, if after being
notified by the IRS that you were subject to backup withholding, you received another
notification from the IRS that you are no longer subject to backup withholding, do not
cross out such Item (2).
---------------------------------------------------------------------------------------
SIGNATURE DATE Part 3--Awaiting TIN / /
----------------------------------------------
- ------------------------------------------------------------------------------------------------------------------
</TABLE>
NOTE: FAILURE TO COMPLETE AND RETURN THIS FORM MAY RESULT IN BACKUP
WITHHOLDING OF 31% OF ANY PAYMENTS MADE TO YOU PURSUANT TO THE OFFER. PLEASE
REVIEW THE ENCLOSED GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9 FOR ADDITIONAL DETAILS.
<TABLE>
<S> <C> <C>
SUBSTITUTE
FORM W-9
DEPARTMENT OF THE
TREASURY INTERNAL
REVENUE SERVICE
PAYER'S REQUEST FOR
TAXPAYER IDENTIFICATION
NUMBER (TIN)
</TABLE>
<PAGE> 11
YOU MUST COMPLETE THE FOLLOWING CERTIFICATE IF YOU CHECKED
THE BOX IN PART 3 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 (1) I have mailed or delivered an
application to receive a Taxpayer Identification Number to the appropriate
Internal Revenue Service Center or Social Security Administration Office, or (2)
I intend to mail or deliver an application in the near future. I understand that
if I do not provide a Taxpayer Identification Number by the time of payment, 31%
of all reportable payments made to me will be withheld, but that such amounts
will be refunded to me if I then provide a Taxpayer Identification Number within
sixty (60) days.
Signature Date 1996
- ------------------------------------------- ------------------------------------
Facsimile copies of the Letter of Transmittal, properly completed and duly
executed, will be accepted. The Letter of Transmittal, certificates for Shares
and any other required documents should be sent or delivered by each stockholder
of the company or his broker, dealer, commercial bank, trust company or other
nominee to the Depositary at its address set forth below:
The Depositary for the Offer is:
THE FIRST NATIONAL BANK OF BOSTON
<TABLE>
<S> <C> <C>
By Mail: By Facsimile Transmission: By Hand:
Shareholder Services Division (617) 575-2232 BancBoston Trust Company
P.O. Box 1889 (617) 575-2233 of New York
Mail Stop 45-02-53 (For Eligible Institutions Only) 55 Broadway, Third Floor
Boston, Massachusetts 02105 New York, New York
(617) 575-3120
Confirm Facsimile by Telephone: By Overnight Courier:
(617) 575-3120 The First National Bank of Boston
(For Confirmation Only) Shareholder Services Division
150 Royall Street
Mail Stop: 45-02-53
Canton, Massachusetts 02021
</TABLE>
Any questions or requests for assistance may be directed to the Information
Agent at its address and telephone number listed below. Additional copies of the
Offer to Purchase, this Letter of Transmittal and other tender offer materials
may be obtained from the Information Agent as set forth below, and will be
furnished promptly at the Purchaser's expense. You may also contact your broker,
dealer, commercial bank, trust company or other nominee for assistance
concerning the Offer.
The Information Agent for the Offer is:
(GEORGESON LOGO)
Wall Street Plaza
New York, New York 10005
Banks and Brokers Call Collect (212) 440-9800
Call Toll-Free: (800) 223-2064
<PAGE> 1
NOTICE OF GUARANTEED DELIVERY
FOR
TENDER OF SHARES OF COMMON STOCK
OF
AMBAR, INC.
This Notice of Guaranteed Delivery or one substantially equivalent hereto
must be used to accept the Offer (as defined below) if certificates representing
shares of common stock, par value $.01 per share (the "Shares"), of AMBAR, Inc.,
a Delaware corporation (the "Company"), are not immediately available or time
will not permit all required documents to reach The First National Bank of
Boston (the "Depositary") on or prior to the Expiration Date (as defined in the
Offer to Purchase), or the procedures for delivery by book-entry transfer cannot
be completed on a timely basis. This Notice of Guaranteed Delivery may be
delivered by hand or sent by facsimile transmission or mail to the Depositary.
See Section 3 of the Offer to Purchase.
THE DEPOSITARY FOR THE OFFER IS:
THE FIRST NATIONAL BANK OF BOSTON
<TABLE>
<S> <C> <C>
By Mail: By Facsimile Transmission: By Hand:
Shareholder Services Division (617) 575-2232 BancBoston Trust Company
P.O. Box 1889 (617) 575-2233 of New York
Mail Stop 45-02-53 (For Eligible Institutions 55 Broadway, Third Floor
Boston, Massachusetts 02105 Only) New York, New York
(617) 575-3120
Confirm Facsimile by Telephone: By Overnight Courier:
(617) 575-3120 The First National Bank of
(For Confirmation Only) Boston
Shareholder Services Division
150 Royall Street
Mail Stop: 45-02-53
Canton, Massachusetts 02021
</TABLE>
DELIVERY OF THIS NOTICE OF GUARANTEED DELIVERY TO AN ADDRESS OTHER THAN AS
SET FORTH ABOVE OR TRANSMISSION OF INSTRUCTIONS VIA A FACSIMILE TRANSMISSION TO
A NUMBER OTHER THAN AS SET FORTH ABOVE WILL NOT CONSTITUTE A VALID DELIVERY.
THIS NOTICE OF GUARANTEED DELIVERY IS NOT TO BE USED TO GUARANTEE
SIGNATURES. IF A SIGNATURE ON A LETTER OF TRANSMITTAL IS REQUIRED TO BE
GUARANTEED BY AN "ELIGIBLE INSTITUTION" UNDER THE INSTRUCTIONS THERETO, SUCH
SIGNATURE GUARANTEE MUST APPEAR IN THE APPLICABLE SPACE PROVIDED IN THE
SIGNATURE BOX ON THE LETTER OF TRANSMITTAL.
<PAGE> 2
Ladies and Gentlemen:
The undersigned hereby tenders to AI Acquisitions Corp., a Delaware
corporation ("Purchaser"), upon the terms and subject to the conditions set
forth in the Offer to Purchase, dated July 9, 1996 (the "Offer to Purchase"),
and in the related Letter of Transmittal (which together constitute the
"Offer"), receipt of each of which is hereby acknowledged, the number of Shares
indicated below pursuant to the guaranteed delivery procedures set forth in
Section 3 of the Offer to Purchase.
Number of Shares: Shares
Certificate No(s). (if available):
If Share(s) will be tendered by book-entry transfer, check one box.
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company
Name(s) of Record Holder(s):
Address(es):
Area Code and Telephone Number(s):
Signature(s):
THE GUARANTEE BELOW MUST BE COMPLETED
GUARANTEE
(NOT TO BE USED FOR SIGNATURE GUARANTEE)
The undersigned, a firm that is a bank, broker, dealer, credit union,
savings association or other entity which is a member in good standing of the
Securities Transfer Agents Medallion Program, hereby (1) represents that the
tender of Shares effected hereby complies with Rule 14e-4 under the Securities
Exchange Act of 1934, as amended, and (2) guarantees to deliver to the
Depositary, at one of its addresses set forth above, the certificates
representing all tendered Shares, in proper form for transfer, or a Book-Entry
Confirmation (as defined in the Offer to Purchase), together with a properly
completed and duly executed Letter of Transmittal (or facsimile thereof), with
any required signature guarantees, or, in the case of book-entry transfer of
Shares, an Agent's Message (as defined in the Offer to Purchase), and any other
documents required by the Letter of Transmittal within three NASDAQ National
Market trading days after the date of execution of this Notice of Guaranteed
Delivery.
<TABLE>
<S> <C>
- -------------------------------------------- --------------------------------------------
Name of Firm (Authorized Signature)
- -------------------------------------------- --------------------------------------------
Address Title
Name:
(Please type or print)
- --------------------------------------------
Date:
- --------------------------------------------
Area Code and Telephone Number
</TABLE>
NOTE: DO NOT SEND SHARE CERTIFICATES FOR SHARES WITH THIS NOTICE
OF GUARANTEED DELIVERY. SHARE CERTIFICATES SHOULD BE
SENT WITH YOUR LETTER OF TRANSMITTAL.
<PAGE> 1
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
AMBAR, INC.
AT
$18 NET PER SHARE
BY
AI ACQUISITIONS CORP.
A CORPORATION FORMED BY
THE BEACON GROUP
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON MONDAY, AUGUST 5, 1996, UNLESS THE OFFER IS EXTENDED
July 9, 1996
To Brokers, Dealers, Commercial Banks,
Trust Companies and Other Nominees:
We have been appointed by AI Acquisitions Corp., a Delaware corporation
("Purchaser") formed by The Beacon Group, a New York general partnership, to act
as Information Agent in connection with Purchaser's offer to purchase all
outstanding shares of common stock, par value $.01 per share (the "Shares"), of
AMBAR, Inc., a Delaware corporation (the "Company"), at a purchase price of $18
per Share, net to the seller in cash, without interest thereon, upon the terms
and subject to the conditions set forth in the Offer to Purchase, dated July 9,
1996 (the "Offer to Purchase"), and in the related Letter of Transmittal (which
together constitute "Offer") enclosed herewith.
Holders of Shares whose certificates for such Shares (the "Share
Certificates") are not immediately available or who cannot complete the
procedures for book-entry transfer on a timely basis, must tender their Shares
according to the guaranteed delivery procedures set forth in Section 3 of the
Offer to Purchase.
Please furnish copies of the enclosed materials to those of your clients
for whose accounts you hold Shares registered in your name or in the name of
your nominee.
The Offer is conditioned upon, among other things, Shares representing not
less than 90% of the outstanding Shares on a Fully Diluted Basis (as defined in
the Offer to Purchase) being validly tendered and not withdrawn prior to the
expiration of the Offer (the "Minimum Share Condition"). The Offer is also
subject to other terms and conditions contained in the Offer to Purchase. See
the Introduction and Sections 1, 14 and 15 of the Offer to Purchase.
Enclosed herewith for your information and forwarding to your clients are
copies of the following documents:
1. The Offer to Purchase, dated July 9, 1996.
2. The Letter of Transmittal to tender Shares for your use and for the
information of your clients. Facsimile copies of the Letter of Transmittal
may be used to tender Shares.
3. The Notice of Guaranteed Delivery for Shares to be used to accept
the Offer if certificates for Shares are not immediately available or if
such certificates and all other required documents cannot be
<PAGE> 2
delivered to The First National Bank of Boston (the "Depositary") by the
Expiration Date or if the procedure for book-entry transfer cannot be
completed by the Expiration Date.
4. A letter to stockholders of the Company from Randolph M. Moity,
Sr., Chairman, Chief Executive Officer and President of the Company,
together with the Solicitation/Recommendation Statement on Schedule 14D-9
filed with the Securities and Exchange Commission by the Company.
5. A printed form of letter which may be sent to your clients for
whose accounts you hold Shares registered in your name or in the name of
your nominee, with space provided for obtaining such clients' instructions
with regard to the Offer.
6. Guidelines of the Internal Revenue Service for Certification of
Taxpayer Identification Number on Substitute Form W-9.
7. A return envelope addressed to the Depositary.
YOUR PROMPT ACTION IS REQUESTED. WE URGE YOU TO CONTACT YOUR CLIENTS AS
PROMPTLY AS POSSIBLE. PLEASE NOTE THAT THE OFFER AND WITHDRAWAL RIGHTS WILL
EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY TIME, ON MONDAY, AUGUST 5, 1996, UNLESS
THE OFFER IS EXTENDED.
In order to accept the Offer, a duly executed and properly completed Letter
of Transmittal and any required signature guarantees, or an Agent's Message (as
defined in the Offer to Purchase) in connection with a book-entry delivery of
Shares, and any other required documents should be sent to the Depositary and
Share Certificates representing the tendered Shares should be delivered to the
Depositary or such Shares should be tendered by book-entry transfer into the
Depositary's account maintained at one of the Book Entry Transfer Facilities (as
described in the Offer to Purchase), all in accordance with the instructions set
forth in the Letter of Transmittal and the Offer to Purchase.
If holders of Shares wish to tender, but it is impracticable for them to
forward their Share Certificates or other required documents on or prior to the
Expiration Date or to comply with the book-entry transfer procedures on a timely
basis, a tender of Shares may be effected by following the guaranteed delivery
procedures specified in Section 3 of the Offer to Purchase.
Purchaser will not pay any commission or fees to any broker, dealer or
other person (other than the Information Agent, as described in the Offer to
Purchase) for soliciting tenders of Shares pursuant to the Offer. Purchaser
will, however, upon request, reimburse you for customary clerical and mailing
expenses incurred by you in forwarding any of the enclosed materials to your
clients. Parent will pay or cause to be paid any stock transfer taxes payable on
the transfers of Shares to it, except as otherwise provided in Instruction 6 of
the Letter of Transmittal.
Any inquiries you may have with respect to the Offer should be addressed to
us at our address and telephone number set forth on the back cover of the Offer
to Purchase. Requests for additional copies of the enclosed materials may also
be directed to us.
Very truly yours,
GEORGESON & COMPANY INC.
Information Agent
NOTHING CONTAINED HEREIN OR IN THE ENCLOSED DOCUMENTS SHALL CONSTITUTE YOU
OR ANY OTHER PERSON THE AGENT OF THE PURCHASER, THE COMPANY, THE DEPOSITARY OR
THE INFORMATION AGENT, OR ANY AFFILIATE OF ANY OF THEM, OR AUTHORIZE YOU OR ANY
OTHER PERSON TO MAKE ANY STATEMENT OR USE ANY DOCUMENT ON BEHALF OF ANY OF THEM
IN CONNECTION WITH THE OFFER OTHER THAN THE ENCLOSED DOCUMENTS AND THE
STATEMENTS CONTAINED THEREIN.
2
<PAGE> 1
OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
AMBAR, INC.
AT
$18 NET PER SHARE
BY
AI ACQUISITIONS CORP.
A CORPORATION FORMED BY
THE BEACON GROUP
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON MONDAY, AUGUST 5, 1996, UNLESS THE OFFER IS EXTENDED
To our Clients:
Enclosed for your consideration are the Offer to Purchase, dated July 9,
1996 (the "Offer to Purchase"), and the related Letter of Transmittal (which
together constitute the "Offer") relating to the offer by AI Acquisitions Corp.,
a Delaware corporation ("Purchaser") formed by The Beacon Group, a New York
general partnership, to purchase all outstanding shares of common stock, par
value $.01 per share (the "Shares"), of AMBAR, Inc., a Delaware corporation (the
"Company"), at a purchase price of $18 per Share, net to the seller in cash,
without interest thereon, upon the terms and subject to the conditions set forth
in the Offer to Purchase and in the related Letter of Transmittal enclosed
herewith. Holders of Shares whose certificates for such Shares (the "Share
Certificates") are not immediately available or who cannot deliver all required
documents to the Depositary on or prior to the Expiration Date, or who cannot
complete the procedures for book-entry transfer on a timely basis, must tender
their Shares according to the guaranteed delivery procedures set forth in
Section 3 of the Offer to Purchase.
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.
Accordingly, we request instructions as to whether you wish to have us
tender on your behalf any or all Shares held by us for your account pursuant to
the terms and conditions set forth in the Offer.
Please note the following:
1. The tender price is $18 per Share, net to you in cash without
interest thereon, upon the terms and subject to the conditions set forth in
the Offer.
2. The Offer is being made for all Shares.
3. The Offer is conditioned upon, among other things, Shares
representing not less than 90% of the outstanding Shares on a Fully Diluted
Basis (as defined in the Offer to Purchase) being validly tendered and not
withdrawn prior to the expiration of the Offer (the "Minimum Share
Condition"). The Offer is
<PAGE> 2
also subject to other terms and conditions contained in the Offer to
Purchase. See the Introduction and Sections 1, 14 and 15 of the Offer to
Purchase.
4. Tendering stockholders will not be obligated to pay brokerage fees
or commissions or, except as otherwise provided in Instruction 6 of the
Letter of Transmittal, stock transfer taxes on the purchase of Shares by
the Purchaser pursuant to the Offer.
5. The Offer and withdrawal rights will expire at 12:00 midnight, New
York City time, on Monday, August 5, 1996, unless the Offer is extended.
6. Payment for Shares purchased pursuant to the Offer will in all
cases be made only after timely receipt by The First National Bank of
Boston (the "Depositary") of (a) Share Certificates for such Shares or
timely confirmation of the book-entry transfer of such Shares into the
account maintained by the Depositary at The Depository Trust Company,
Midwest Securities Trust Company or Philadelphia Depository Trust Company
(collectively, the "Book-Entry Transfer Facilities"), pursuant to the
procedures set forth in Section 3 of the Offer to Purchase, (b) the Letter
of Transmittal (or a facsimile thereof), properly completed and duly
executed, with any required signature guarantees or an Agent's Message (as
defined in the Offer to Purchase), in connection with a book-entry
transfer, and (c) any other documents required by the Letter of
Transmittal. Accordingly, payment may not be made to all tendering
stockholders at the same time depending upon when Share Certificates or
confirmations of book-entry transfer of such Shares into the Depositary's
account at a Book-Entry Transfer Facility are actually received by the
Depositary.
If you wish to have us tender any or all of the Shares held by us for your
account, please so instruct us by completing, executing, detaching and returning
to us the instruction form set forth below. If you authorize the tender of your
Shares, all such Shares will be tendered unless otherwise specified below. An
envelope to return your instructions to us is enclosed. 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.
The Offer is not being made to (nor will tenders be accepted from or on
behalf of) holders of Shares residing in any jurisdiction in which the making of
the Offer or the acceptance thereof would not be in compliance with the
securities, blue sky or other laws of such jurisdiction. However, Purchaser may,
in its discretion, take such action as it may deem necessary to make the Offer
in any jurisdiction and extend the Offer to holders of Shares in such
jurisdiction.
In any jurisdiction where the securities, blue sky or other laws require
the Offer to be made by a licensed broker or dealer, the Offer is being made on
behalf of Purchaser by one or more registered brokers or dealers that are
licensed under the laws of such jurisdiction.
2
<PAGE> 3
INSTRUCTIONS WITH RESPECT TO THE OFFER TO PURCHASE
FOR CASH ALL SHARES OF COMMON STOCK
OF
AMBAR, INC.
The undersigned acknowledge(s) receipt of your letter and the enclosed
Offer to Purchase, dated July 9, 1996 (the "Offer to Purchase"), and the related
Letter of Transmittal (which together constitute the "Offer") in connection with
the offer by AI Acquisitions Corp., a Delaware corporation ("Purchaser") formed
by The Beacon Group, a New York general partnership, to purchase all outstanding
shares of common stock, par value $.01 per share (the "Shares"), of AMBAR, Inc.,
a Delaware corporation (the "Company"), at a purchase price of $18 per Share,
net to the seller in cash, without interest thereon, upon the terms and subject
to the conditions set forth in the Offer to Purchase.
This will instruct you to tender to Purchaser the number of Shares
indicated below (or if no number is indicated below, all Shares), which are held
by you for the account of the undersigned, upon the terms and subject to the
conditions set forth in the Offer.
<TABLE>
<S> <C>
Number of Shares: Name(s) of Record Holder(s):
Certificate Nos. (if available): (PLEASE TYPE OR PRINT)
Check ONE box if Shares will be tendered by
book-entry transfer: Address(es):
/ / The Depository Trust Company
/ / Midwest Securities Trust Company
/ / Philadelphia Depository Trust Company (INCLUDE ZIP CODE)
Account Number: Area Code and Tel. No.:
Signature(s):
Dated:
</TABLE>
<PAGE> 1
EXHIBIT (A)(6)
GUIDELINES FOR CERTIFICATION OF TAXPAYER IDENTIFICATION
NUMBER ON SUBSTITUTE FORM W-9
GUIDELINES FOR DETERMINING THE PROPER IDENTIFICATION NUMBER TO GIVE THE
PAYER. -- Social Security numbers have nine digits separated by two hyphens:
i.e. 000-00-0000. Employer identification numbers have nine digits separated by
only one hyphen: i.e. 00-0000000. The table below will help determine the number
to give the payer.
- ------------------------------------------------------------------
<TABLE>
<C> <S> <C>
FOR THIS TYPE OF ACCOUNT: GIVE THE
SOCIAL SECURITY
NUMBER OF --
- ----
1. An individual's account The individual
2. Two or more individuals (joint The actual owner of the
account) account or, if combined
funds, any one of the
individuals (1)
3. Custodian and wife (joint account) The actual owner of the
account or, if joint funds,
either person (1)
4. Custodian account of a minor The minor (2)
(Uniform Gift to Minors Act)
5. Adult and minor (joint account) The adult or, if the minor
is the only contributor,
the minor (1)
6. Account in the name of guardian or The ward, minor, or
committee for a designated ward, incompetent person (3)
minor, or incompetent person
7. a The usual revocable savings trust The grantor-trustee (1)
account (grantor is also trustee)
b So-called trust account that is The actual owner (1)
not a legal or valid trust under
State law
- ----
FOR THIS TYPE OF ACCOUNT: GIVE THE EMPLOYER
IDENTIFICATION
NUMBER OF --
- ----
8. Sole proprietorship account The Owner (4)
9. A valid trust, estate, or pension Legal entity (Do not
trust furnish the identifying
number of the personal
representative or trustee
unless the legal entity
itself is not designated in
the account title.) (5)
10. Corporate account The Corporation
11. Religious, charitable, or The organization
educational organization account
12. Partnership account held in the The partnership
name of the business
13. Association, club, or other tax- The organization
exempt organization
14. A broker or registered nominee The broker or nominee
15. Account with the Department of The public entity
Agriculture in 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.
(2) Circle the minor's name and furnish the minor's social security number.
(3) Circle the ward's, minor's or incompetent person's name and furnish such
person's social security number.
(4) Show the name of the owner.
(5) List first and circle the name of the legal trust, estate, or pension trust.
NOTE: If no name is circled when there is more than one name, the number will be
considered to be that of the first name listed.
OBTAINING A NUMBER
If you don't have a taxpayer identification number or you don't know your
number, obtain Form SS-5, Application for a Social Security Number Card, or Form
SS-4, Application for Employer Identification Number, at the local office of the
Social Security Administration or the Internal Revenue Service and apply for a
number.
PAYEES EXEMPT FROM BACKUP WITHHOLDING
Payees specifically exempted from backup withholding on ALL payments include the
following:
- - A corporation.
- - A financial institution.
- - An organization exempt from tax under section 501(a), or an individual
retirement plan.
- - The United States or any agency or instrumentality thereof.
- - A State, the District of Columbia, a possession of the United States, or any
subdivision or instrumentality thereof.
- - A foreign government, a political subdivision of a foreign government, or
agency or instrumentality thereof.
- - An international organization or any agency, or instrumentality thereof.
- - A registered dealer in securities or commodities registered in the U.S. or a
possession of the U.S.
- - A real estate investment trust.
- - A common trust fund operated by a bank under section 584(a).
- - An exempt charitable remainder trust, or a non-exempt trust described in
section 4947(a)(1).
- - An entity registered at all times under the Investment Company Act of 1940.
- - A foreign central bank of issue.
Payments of dividends and patronage dividends not generally subject to
backup withholding include the following:
- - Payments to nonresident aliens subject to withholding under section 1441.
- - Payments to partnerships not engaged in a trade or business in the U.S. and
which have at least one nonresident partner.
- - Payments of patronage dividends where the amount received is not paid in
money.
- - Payments made by certain foreign organizations.
- - Payments made to a nominee.
Payments of interest not generally subject to backup withholding include the
following:
- - Payments of interest on obligations issued by individuals.
NOTE: You may be subject to backup withholding if this interest is $600 or more
and is paid in the course of the payer's trade or business and you have not
provided your correct taxpayer identification number to the payer.
- - Payments of tax-exempt interest (including exempt interest dividends under
section 852).
- - Payments described in section 6049(b)(5) to nonresident aliens.
- - Payments on tax-free covenant bonds under section 1451.
- - Payments made by certain foreign organizations.
- - Payments made to a nominee.
Exempt payees described above should file Form W-9 to avoid possible erroneous
backup withholding. FILE THIS FORM WITH THE PAYER, FURNISH YOUR TAXPAYER
IDENTIFICATION NUMBER, WRITE "EXEMPT" ON THE FACE OF THE FORM, AND RETURN IT TO
THE PAYER, IF THE PAYMENTS ARE INTEREST, DIVIDENDS, OR PATRONAGE DIVIDENDS, ALSO
SIGN AND DATE THE FORM.
Certain payments other than interest, dividends, and patronage dividends
that are not subject to information reporting are also not subject to backup
withholding. For details, see the regulations under sections 6041, 6041A (a),
6045, and 6050A.
PRIVACY ACT NOTICE.--Section 6109 requires most recipients of dividend,
interest, or other payments to give taxpayer identification numbers to payers
who must report the payments to IRS. IRS uses the numbers for identification
purposes. Payers must be given the numbers whether or not recipients are
required to file tax returns. Payers must generally withhold 31% of taxable
interest, dividend, and certain other payments to a payee who does not furnish a
taxpayer identification number to a payer. Certain penalties may also apply.
PENALTIES
(1) PENALTY FOR FAILURE TO FURNISH TAXPAYER IDENTIFICATION NUMBER. -- If you
fail to furnish your taxpayer identification number to a payer, you are subject
to a penalty of $50 for each such failure unless your failure is due to
reasonable cause and not to willful neglect.
(2) CIVIL PENALTY FOR FALSE INFORMATION WITH RESPECT TO WITHHOLDING. -- If you
make a false statement with no reasonable basis which results in no imposition
of backup withholding, you are subject to a penalty of $500.
(3) CRIMINAL PENALTY FOR FALSIFYING INFORMATION. -- Falsifying certifications or
affirmations may subject you to criminal penalties including fines and/or
imprisonment.
(4) 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 and such failure is due to negligence, a
penalty of 20% is imposed on any portion of any underpayment attributable to the
failure.
FOR ADDITIONAL INFORMATION CONTACT YOUR TAX
CONSULTANT OR THE INTERNAL REVENUE SERVICE
<PAGE> 1
Exhibit (a)(7)
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 July 9,
1996, and the related Letter of Transmittal, and is being made to all holders of
Shares. The Purchaser is not aware of any state where the making of the Offer is
prohibited by administrative or judicial action pursuant to any valid state
statute. If the Purchaser becomes aware of any valid state statute prohibiting
the making of the Offer or the acceptance of Shares pursuant thereto, the
Purchaser will make a good faith effort to comply with any such state statute or
seek to have such statute declared inapplicable to the Offer. If, after such
good faith effort, the Purchaser cannot comply with any such state statute, the
Offer will not be made to (nor will tenders be accepted from or on behalf of)
holders of Shares in such state. In any jurisdiction where the securities, blue
sky or other laws require the Offer to be made by a licensed broker or dealer,
the Offer shall be deemed to be made on behalf of the Purchaser by one or more
registered brokers or dealers licensed under the laws of such jurisdiction.
NOTICE OF OFFER TO PURCHASE FOR CASH
ALL OUTSTANDING SHARES OF COMMON STOCK
OF
AMBAR, INC.
AT
$18 NET PER SHARE
BY
AI ACQUISITIONS CORP.
A CORPORATION FORMED BY
THE BEACON GROUP
AI Acquisitions Corp., a Delaware corporation (the "Purchaser") and a
wholly owned subsidiary of AI Partners L.P. ("Parent"), a Delaware limited
partnership, is offering to purchase all outstanding shares of Common Stock, par
value $.01 per share (the "Shares"), of AMBAR, Inc., a Delaware corporation (the
"Company"), at $18 per Share, net to the seller in cash, without interest
thereon, upon the terms and subject to the conditions set forth in the Offer to
Purchaser, dated July 9, 1996 (the "Offer to Purchase"), and in the related
Letter of Transmittal (which together constitute the "Offer"). The Purchaser and
Parent have been formed by The Beacon Group, a New York general partnership, for
purposes of the transactions described herein. Following the Offer, the
Purchaser intends to effect the Merger described below.
THE OFFER AND WITHDRAWAL RIGHTS WILL EXPIRE AT 12:00 MIDNIGHT, NEW YORK CITY
TIME, ON MONDAY, AUGUST 5, 1996 UNLESS EXTENDED.
<PAGE> 2
THE OFFER IS CONDITIONED UPON, AMONG OTHER THINGS, (i) THERE BEING
VALIDLY TENDERED AND NOT WITHDRAWN BY THE EXPIRATION DATE (AS DEFINED BELOW) A
NUMBER OF SHARES WHICH REPRESENTS NOT LESS THAN 90% OF THE COMPANY'S COMMON
STOCK OUTSTANDING ON A FULLY DILUTED BASIS AND (ii) CERTAIN OTHER CONDITIONS
CONTAINED IN THE OFFER TO PURCHASE.
The purpose of the Offer and the Merger is to enable Parent to acquire
control of, and the entire common equity interest in, the Company. The Offer is
being made pursuant to an Agreement of Merger, dated as of July 1, 1996 (the
"Merger Agreement"), among Parent, the Purchaser and the Company. The Merger
Agreement provides, among other things, for the commencement of the Offer by the
Purchaser and further provides that, subject to the satisfaction or waiver of
certain conditions, the Purchaser will be merged with and into the Company (the
"Merger"), with the Company surviving the Merger. Pursuant to the Merger, each
then-outstanding Share not owned by Parent, the Purchaser or any other direct or
indirect subsidiary of Parent (other than Shares held in the treasury of the
Company and Shares held by holders who perfect their appraisal rights as
described in the Offer to Purchase) will be converted into a right to receive in
cash an amount per Share equal to the highest price per Share paid pursuant to
the Offer, without interest thereon, upon surrender of the certificate formerly
representing such Share.
THE BOARD OF DIRECTORS OF THE COMPANY HAS APPROVED THE OFFER AND THE
MERGER AND DETERMINED THAT THE TERMS OF THE OFFER AND THE MERGER ARE FAIR TO AND
IN THE BEST INTERESTS OF THE COMPANY AND ITS STOCKHOLDERS AND RECOMMENDS THAT
HOLDERS OF SHARES 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, if and
when the Purchaser gives oral or written notice to The First National Bank of
Boston, as the Depositary, of the Purchaser's acceptance of such Shares for
payment pursuant to the Offer. In all cases, upon the terms and subject to the
conditions of the Offer, payment for Shares purchased pursuant to the Offer will
be made by deposit of the purchase price therefor with the Depositary, which
will act as agent for tendering stockholders for the purpose of receiving
payment from the Purchaser and transmitting payment to validly tendering
stockholders. Under no circumstances will interest on the purchase price for
Shares be paid by the Purchaser. In all cases, payment for Shares purchased
pursuant to the Offer will be made only after timely receipt by the
Depositary of (i) certificates representing Shares (the "Share Certificates")
(or a timely Book-Entry confirmation), pursuant to the procedures set forth in
Section 3 of the Offer to Purchase, (ii) the Letter of Transmittal (or a
facsimile thereof), properly completed and duly executed, with any required
signature guarantees or an Agent's Message (as defined in the Offer to Purchase)
in connection with a book-entry transfer, and (iii) any other documents required
by the Letter of Transmittal. Upon the terms and subject to the conditions of
the Offer, all Shares validly tendered will be accepted for purchase on the
Expiration Date.
The term "Expiration Date" means 12:00 midnight, New York City time, on
Monday, August 5, 1996, unless and until the Purchaser (subject to the terms of
the Merger Agreement) shall have extended the period of time during which the
Offer is open, in which event the term "Expiration Date" shall refer to the
latest time and date at which the Offer, as so extended by the Purchaser, will
expire. The Purchaser expressly reserves the right, at any time or from time to
time, subject to the terms of the Merger Agreement, 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 by making a public announcement thereof by no later than
9:00 a.m. New York City time, on the next business day after the previously
scheduled Expiration Date in accordance with the announcement requirements of
Rule 14d-4(c) under the Securities Exchange Act of 1934, as amended. During any
such extension, all Shares previously tendered and not withdrawn will remain
subject to the Offer, subject to the right of a tendering stockholder to
withdraw such stockholder's Shares. Without limiting the manner in which the
Purchaser may choose to make any public announcement, the Purchaser currently
intends to make such announcement by issuing a press release to the Dow Jones
News Service.
Except as otherwise provided below, tenders of Shares made pursuant to
the Offer are irrevocable. 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, may also be withdrawn at any time after
September 6, 1996. For a withdrawal
<PAGE> 3
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. Any such notice of withdrawal
must specify the name of the person who tendered the Shares to be withdrawn, the
number of shares to be withdrawn, and the name of the registered holder, if
different from that of the person who tendered such Shares. If certificates for
the Shares have been delivered or otherwise identified to the Depositary, then
(except in the case of Shares tendered for the account of an Eligible
Institution, as defined under "Procedures for Tendering Shares" in the Offer to
Purchase) prior to the release of such certificates, the tendering stockholder
must also submit the serial numbers shown on the particular certificates
evidencing the Shares to be withdrawn, and the signature on the notice of
withdrawal must be guaranteed by an Eligible Institution. If Shares have been
tendered pursuant to the procedure for book-entry transfer set forth under
"Procedures for Tendering Shares" in the Offer to Purchase, the notice of
withdrawal must also specify the name and number of the account at the
appropriate Book-Entry Transfer Facility to be credited with the withdrawn
Shares. 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, whose determination shall be final and binding. None of the
Purchaser, Parent, the Company, the Depositary, the Information Agent (as set
forth below) 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 failing to give such notification. Any Shares properly withdrawn will be
deemed not validly tendered for purposes of the Offer. However, withdrawn Shares
may be tendered again by following any of the procedures described under
"Procedures for Tendering Shares" in the Offer to Purchase.
The Company has provided the Purchaser with the Company's stockholder
list and security position listings for the purpose of disseminating the Offer
to holders of Shares. The Offer to Purchase, the related Letter of Transmittal
and other relevant materials will be mailed to record holders of Shares and will
be furnished to brokers, dealers, commercial banks, trust companies and similar
persons whose names, or the names of whose nominees, appear on the Company's
stockholder list or, if applicable, who are listed as participants in a clearing
agency's security position listing, for subsequent transmittal to beneficial
owners of Shares by the Purchaser.
The information required to be disclosed by Rule 14d-6(e)(1)(vii) of
the General Rules and Regulations under the Securities Exchange Act of 1934, as
amended, is contained in the Offer to Purchase and is incorporated herein by
reference.
THE OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL CONTAIN
IMPORTANT INFORMATION WHICH SHOULD BE READ CAREFULLY BEFORE ANY DECISION IS MADE
WITH RESPECT TO THE OFFER.
Requests for copies of the Offer to Purchase, the Letter of Transmittal
and other tender offer documents may be directed to the Information Agent, and
copies will be furnished promptly at the Purchaser's expense. Questions or
requests for assistance may be directed to the Information Agent. Except as set
forth under "Fees and Expenses" in the Offer to Purchase, the Purchaser will not
pay any fees or commissions to any broker or dealer or other person (other than
the Depositary and the Information Agent) in connection with the solicitation of
tenders of Shares pursuant to the Offer.
The Information Agent for the Offer is:
GEORGESON
& COMPANY INC.
--------------------
Wall Street Plaza
New York, New York 10005
(Toll Free) (800) 223-2064
Brokers and Banks, please call collect (212) 440-9800
July 9, 1996
<PAGE> 1
Exhibit (a)(8)
Contact: Barry N. Huntsman
(318) 237-5300
FOR IMMEDIATE RELEASE
AMBAR ANNOUNCES AGREEMENT TO BE ACQUIRED
BY THE BEACON GROUP ENERGY INVESTMENT FUND, L.P.
LAFAYETTE, LA., July 1, 1996 -- AMBAR, Inc. (NASDAQ: AMBR) announced
today that it has executed a definitive agreement with The Beacon Group Energy
Investment Fund, L.P. for the acquisition of all of its common shares.
Under the agreement, an affiliate of the Beacon fund will commence a
tender offer for all of AMBAR's shares at a price of $18 per share. Following
the successful completion of the tender offer, the remaining shares will be
acquired at the same price through a merger with the Beacon affiliate.
In connection with the merger agreement, Beacon has also entered into
an agreement to purchase the 51% of AMBAR's shares currently owned by Randolph
M. Moity, the company's Chairman, President and Chief Executive Officer and the
6% of AMBAR's shares owned by Kenneth J. Boutte, an AMBAR director.
AMBAR's Board of Directors has approved the tender offer, merger and
stock purchase agreements and has recommended that AMBAR's stockholders accept
the tender offer. The Board has received the opinion of Raymond James &
Associates, Inc. that the transaction is fair, from a financial point of view,
to the company's stockholders. The tender offer and merger are subject to
various conditions, including that at least 90% of the company's outstanding
shares be tendered.
Mr. Moity noted that "This acquisition provides a very attractive cash
price to our stockholders and recognizes the value we at AMBAR have created. The
Board of Directors of the company is pleased to recommend unanimously the
transaction to the company's stockholders."
AMBAR designs, blends and markets certain fluids and chemicals, and
provides environmental services, primarily along the Louisiana and Texas Gulf
Coast.
The Beacon Group Energy Investment Fund, L.P. is a $658 million equity
limited partnership focused on strategic investments in the energy industry. It
is affiliated with The Beacon Group, a private investment partnership in New
York, which is also engaged in non-energy investments through its Focus Value
Fund and provides strategic advisory services to public and private companies.
<PAGE> 1
EXHIBIT (a)(9)
Contact: Faith Rosenfeld
(212) 339-9100
FOR IMMEDIATE RELEASE
- ---------------------
BEACON TENDERS FOR ALL COMMON SHARES OF AMBAR
New York, New York, July 9, 1996 -- The Beacon Group announced today that its
affiliate, AI Acquisitions Corp., has commenced its previously announced cash
tender offer for all common shares of AMBAR, Inc., of Lafayette, Louisiana
(NASDAQ: AMBR) at a price of $18 per share.
On Tuesday, July 2, 1996, Beacon and AMBAR announced they had entered into a
Merger Agreement which contemplated the cash tender offer commenced today.
Following the successful completion of the tender offer, AI Acquisitions Corp.
will be merged with and into AMBAR.
As previously disclosed, Beacon has also entered into agreements to purchase
the 50% of the outstanding shares of AMBAR owned by Randolph M. Moity, AMBAR's
Chairman, President and Chief Executive Officer and the 6% of the outstanding
shares of AMBAR owned by Kenneth J. Boutte, an AMBAR Director.
The Board of Directors of AMBAR has approved the tender offer and the merger and
determined that the terms of the offer and the merger are fair to, and in the
best interests of, the Company and its stockholders and has recommended that
AMBAR's stockholders accept the tender offer and tender their shares. The Board
has received the opinion of Raymond James & Co. that the transaction is fair,
from a financial point of view, to AMBAR's stockholders. The consummation of the
tender offer and merger are subject to various conditions, including that at
least 90% of AMBAR's outstanding shares be tendered.
The tender offer is scheduled to expire at 12:00 midnight, New York City time,
on Monday, August 5, 1996, unless extended.
AMBAR designs, blends and markets certain fluids and chemicals, and provides
environmental services, primarily along the Louisiana and Texas Gulf Coast.
The Beacon Group, a private investment firm in New York, manages The Beacon
Group Energy Investment Fund, L.P., a $658 million equity limited partnership
focused on strategic investments in the energy industry, and provides strategic
advisory services to public and private companies.
Georgeson & Company Inc. has been retained by Beacon as Information Agent in
connection with the Offer. Information on the Offer can be obtained by phoning
Georgeson & Company Inc. at (800) 223-2064 (toll free) or (212) 440-9800
(collect).
<PAGE> 1
AGREEMENT AND PLAN OF MERGER
AMONG
AMBAR, INC.,
AI PARTNERS L.P.
AND
AI ACQUISITIONS CORP.
DATED AS OF JULY 1, 1996
<PAGE> 2
AGREEMENT AND PLAN OF MERGER
AGREEMENT AND PLAN OF MERGER, dated as of July 1, 1996 (the "Agreement"),
among AMBAR, Inc., a Delaware corporation (the "Company"), AI Partners L.P., a
Delaware limited partnership ("Purchaser"), and AI Acquisitions Corp., a
Delaware corporation and a majority owned subsidiary of Purchaser (the "Sub").
WHEREAS, Purchaser and the Sub desire to acquire the entire equity interest
of the Company; and
WHEREAS, the Board of Directors of the Company has determined that it is in
the best interests of the Company and its stockholders to sell the entire equity
interest of the Company in accordance with the terms and conditions hereof;
NOW THEREFORE, the parties hereto agree as follows:
ARTICLE I
THE OFFER
SECTION 1.1 The Offer.
(a) Provided that this Agreement has not been terminated in accordance with
Section 8.1 and none of the events set forth in Exhibit A hereto has occurred or
exists, as promptly as practicable (but in no event later than five business
days after the date hereof) the Sub shall, and Purchaser shall cause the Sub to,
commence (within the meaning of Rule 14d-2 under the Securities Exchange Act of
1934, as amended (including the rules and regulations promulgated thereunder,
the "Exchange Act")), a tender offer (as it may be amended from time to time as
permitted hereunder, the "Offer") to purchase all the issued and outstanding
shares (the "Shares") of common stock, par value $.01 per share, of the Company
(the "Company Common Stock"), at a price per Share of $18.00 net to the holders
of such Shares in cash, upon the terms and subject to the conditions set forth
in this Agreement. Subject to the conditions of the Offer, Purchaser and the Sub
shall use all reasonable efforts to consummate the Offer as soon as legally
permissible. The obligation of Purchaser and the Sub to consummate the Offer, to
accept for payment and to pay for any and all Shares validly tendered prior to
the expiration of the Offer shall be subject to only those conditions set forth
in Exhibit A hereto. Purchaser will accept for payment all Shares validly
tendered pursuant to the Offer and not withdrawn as soon as legally permissible,
and pay for such Shares as promptly as practicable thereafter, in each case upon
the terms and subject to the conditions of the Offer.
(b) Neither Purchaser nor the Sub will, without the prior written consent
of the Board of Directors of the Company (excluding any designee of the Sub),
decrease the consideration, or change the form of consideration, payable in the
Offer, decrease the number of Shares sought pursuant to the Offer, change the
conditions to the Offer, impose additional conditions to the Offer, change the
expiration date of the Offer, or amend any term of the Offer in any manner
adverse to holders of the Shares. Assuming the prior satisfaction or waiver of
the conditions to the Offer (including, if the Offer is extended or amended, the
terms and conditions of any extension or amendment), the Sub shall accept for
payment, in accordance with the terms of the Offer, any and all Shares validly
tendered prior to the expiration of the Offer and not properly withdrawn
pursuant to the Offer as soon as legally permissible after the commencement
thereof.
(c) Within five (5) business days of the commencement of the Offer,
Purchaser and the Sub shall file with the Securities and Exchange Commission
(the "SEC") a Tender Offer Statement on Schedule 14D-1 with respect to the
Offer, which shall contain an offer to purchase and a related letter of
transmittal and summary advertisement (such Schedule 14D-1 and the documents
therein pursuant to which the Offer will be made, together with any amendments
thereto, the "Offer Documents"). The Offer Documents and the Offer will comply
in all material respects with the Exchange Act, except that no representation is
made by Purchaser or the Sub with respect to information contained in any filing
made by the Company with the SEC pursuant to the Exchange Act or supplied by the
Company specifically for inclusion in the Offer Documents. Each of Purchaser and
the Sub agrees promptly to correct any information provided by it for use in the
Offer
2
<PAGE> 3
Documents if and to the extent that such information shall have become false or
misleading in any material respect, and 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 the Company's stockholders, in each case as and to the
extent required by applicable Federal and state securities laws. Purchaser and
the Sub agree to provide the Company and its counsel in writing with any
comments Purchaser, the Sub or their counsel may receive from the SEC or its
staff with respect to the Offer Documents promptly after the receipt of such
comments.
(d) Purchaser shall provide or cause to be provided to the Sub on a timely
basis the funds necessary to accept for payment, and pay for, any Shares that
the Sub becomes obligated to accept for payment, and pay for, pursuant to the
Offer.
SECTION 1.2 Company Actions.
The Company hereby consents to the Offer and represents that (a) its Board
of Directors (at a meeting duly called and held), upon the recommendation of a
duly appointed Independent Committee (the "Independent Committee") has (i)
determined that the Offer and the Merger (as defined in Section 2.1 hereof) are
fair to and in the best interests of the stockholders of the Company, (ii) taken
all actions to approve the Offer, the Merger and each Stockholder Agreement
dated as of the date hereof (collectively, the "Stockholder Agreements"),
between Purchaser and Randolph M. Moity, Sr. and Kenneth J. Boutte, for purposes
of Section 203 of the Delaware General Corporation Law (the "GCL") and (iii)
subject to its fiduciary duties under applicable laws as advised by counsel,
resolved to recommend acceptance of the Offer and approval and adoption of this
Agreement by the stockholders of the Company, and (b) Raymond James &
Associates, Inc. ("Raymond James") has advised the Company's Board of Directors
that the $18.00 per Share cash consideration to be received by the Company's
stockholders is fair to such stockholders from a financial point of view. The
Company hereby agrees to file with the SEC within five (5) business days of the
commencement of the Offer in accordance with Section 1.1(a) hereof a
Solicitation/Recommendation Statement on Schedule 14D-9 (the "Schedule 14D-9")
with respect to the Offer containing, subject to the Board's fiduciary duties
under applicable law as advised by counsel, such recommendations of the Board in
favor of the Offer and the Merger. The Company will provide Purchaser and the
Sub and their counsel a reasonable opportunity to review and comment on the
Schedule 14D-9 prior to its filing with the SEC. The Schedule 14D-9 and all
amendments thereto will comply as to form in all material respects with the
Exchange Act, and the rules and regulations promulgated thereunder. The Company
hereby consents to the inclusion in the Offer of the recommendation referred to
in the third preceding sentence. The Company agrees to provide Purchaser and the
Sub and their counsel in writing any comments the Company or its counsel may
receive from the SEC or its staff with respect to the Schedule 14D-9 promptly
after the receipt of such comments. In connection with the Offer, the Company
will promptly cause its transfer agent to furnish the Sub with mailing labels,
security position listings and any available listing or computer file containing
the names and addresses of the record holders of the Shares as of a recent date
and will furnish the Sub with such information and assistance as the Sub or its
agents may reasonably request in communicating the Offer to the stockholders of
the Company. The Company agrees that it will take all actions necessary to
except the Offer, the Stockholder Agreements and the Merger from the provisions
of any applicable takeover, business combination or control share acquisition
law or regulation adopted by any State of the United States of America. Subject
to the requirements of applicable law, and except for such actions that are
necessary to disseminate the Offer Documents and any other documents necessary
to consummate the Merger, Purchaser and the Sub and their agents shall hold in
confidence the information contained in any such labels, listings and files,
shall use such information only in connection with the Offer and the Merger and,
if this Agreement is terminated, will, upon request, deliver, and will use their
best efforts to cause their agents to deliver, to the Company all copies of such
information then in their possession or control.
SECTION 1.3 Directors.
Promptly upon the purchase by the Sub of such number of Shares as
represents at least a majority of the outstanding Shares and from time to time
thereafter, the Sub shall be entitled to designate such number of directors,
rounded up to the next whole number but in no event more than one less than the
total number of
3
<PAGE> 4
directors on the Board of Directors of the Company as will give the Sub, subject
to compliance with Section 14(f) of the Exchange Act, representation on the
Board of Directors of the Company equal to the product of the number of
directors on the Board of Directors of the Company and the percentage that such
number of Shares so purchased bears to the number of Shares outstanding and,
subject to the exercise by the Board of Directors of the Company of its
fiduciary duties to the stockholders of the Company under the GCL, the Company
shall, upon request by the Sub, promptly increase the size of the Board of
Directors of the Company or exercise its best efforts to secure the resignations
of such number of directors as is necessary to enable the Sub's designees to be
elected to the Board of Directors of the Company and shall cause the Sub's
designees to be so elected; provided, however, that in the event that the Sub's
designees are appointed or elected to the Board of Directors, until the
Effective Time (as hereinafter defined) the Board of Directors shall have at
least three directors who are directors on the date hereof designated by the
Company and who are not designees, stockholders or affiliates of Purchaser or
the Sub (the "Independent Directors"); provided, further, that in such event, if
the number of Independent Directors shall be reduced to below three for any
reason whatsoever, any remaining Independent Directors (or Independent Director,
if there shall be only one remaining) shall be entitled to designate persons to
fill such vacancies who shall be deemed to be Independent Directors for purposes
of this Agreement or, if no Independent Directors then remain, the other
directors shall in good faith designate three persons to fill such vacancies who
shall be independent in fact and, in any event, shall not be stockholders,
affiliates or agents of Purchaser or the Sub and such persons shall be deemed to
be Independent Directors for purposes of this Agreement. At the reasonable
request of the Sub, the Company shall take, at its expense, all action necessary
to effect any such election, including mailing to its stockholders the
information required by Section 14(f) of the Exchange Act and Rule 14f-1
promulgated thereunder.
ARTICLE II
THE MERGER
SECTION 2.1 The Merger.
Upon the terms and subject to the conditions hereof, and in accordance with
the relevant provisions of the GCL, the Sub shall be merged with and into the
Company (the "Merger") as soon as practicable following the satisfaction or
waiver, if permissible, of the conditions set forth in Article VII hereof.
Following the Merger, the Company shall continue as the surviving corporation
(the "Surviving Corporation") under the name "AMBAR, Inc." and shall continue
its existence under the laws of Delaware, and the separate corporate existence
of the Sub shall cease.
SECTION 2.2 Effective Time.
The Merger shall be consummated by filing with the Delaware Secretary of
State a certificate of merger in such form as is required by, and executed in
accordance with, the relevant provisions of the GCL (the time of such filing
being the "Effective Time").
SECTION 2.3 Effects of the Merger.
The Merger shall have the effects set forth in Section 259 of the GCL. As
of the Effective Time, the Company shall be wholly owned by Purchaser and/or one
or more direct or indirect wholly owned Subsidiaries or affiliates of Purchaser.
SECTION 2.4 Certificate of Incorporation and By-Laws.
The Certificate of Incorporation and the By-Laws of the Surviving
Corporation shall be amended in their entirety to read as set forth in Exhibit
B.
4
<PAGE> 5
SECTION 2.5 Directors and Officers.
The directors of the Sub immediately prior to the Effective Time shall
become the directors of the Surviving Corporation until their successors are
duly elected and qualified. The officers of the Company immediately prior to the
Effective Time shall become the officers of the Surviving Corporation until
their successors are duly elected and qualified.
SECTION 2.6 Conversion of Shares; Stock Options; Warrants.
(a) At the Effective Time, each Share issued and outstanding immediately
prior to the Effective Time (other than Shares owned by the Sub or any affiliate
of the Sub or held in the treasury of the Company or by any subsidiary of the
Company, all of which shall be cancelled and no payment shall be made with
respect thereto, and other than Dissenting Shares, as defined in Section 3.1
hereof) shall, by virtue of the Merger and without any action on the part of the
holder thereof, be converted into the right to receive $18.00 net to the holder
in cash or any higher price that may be paid pursuant to the Offer (the "Merger
Consideration"), payable to the holder thereof, without interest thereon, upon
surrender of the certificate representing such Share.
(b) (i) Effective at the Effective Time, and pursuant to Section 12.11 of
the First Amended Employees' 1991 Incentive Compensation Program (the "Incentive
Plan") and Section 12.11 of the 1994 Non-Employee Directors' Incentive
Compensation Program (the "Directors' Plan"), each issued and outstanding stock
option granted by the Company pursuant to the Incentive Plan and the Directors'
Plan (collectively, the "Options") will become exercisable immediately, and,
upon exercise, shall be converted into cash in an amount equal to the product of
(i) the total number of shares of Company Common Stock subject to such Option
multiplied by (ii) the excess of $18.00 over the exercise price per share, if
any, subject to such Option, less required withholding taxes. The Company will
take all reasonable actions as may be necessary or appropriate to effect the
provisions of this Section 2.6(b)(i), including, without limitation, using
reasonable efforts to obtain the written acknowledgment of each holder of an
Option that the payment of the amount of cash referred to hereinabove will
satisfy and discharge in full the Company's and the Surviving Corporation's
obligation to each employee pursuant to any such Option.
(ii) The Company shall take all reasonable actions to cause Morgan Keegan &
Co., Inc. ("Morgan Keegan") to exercise the warrants issued by the Company to
Morgan Keegan pursuant to that certain Warrant Agreement, dated as of December
12, 1991, and to cause Morgan Keegan to tender the Company Common Stock to be
acquired upon exercise of such warrants into the Offer.
(iii) The Company shall take such actions as are necessary to ensure that
from and after the Effective Time none of the Company, the Surviving Corporation
or any of their respective Subsidiaries is or will be bound by any options,
warrants, rights or agreements which would entitle any person, other than
Purchaser or its wholly owned Subsidiaries, to beneficially own, or receive any
payments in respect of (other than as otherwise contemplated by Section 2.6(a)
and Sections 2.6(b)(i) and (ii) hereof), any capital stock of the Company or the
Surviving Corporation.
SECTION 2.7 Conversion of Sub Common Stock.
Each share of the common stock, par value $.01 per share, of the Sub issued
and outstanding immediately prior to the Effective Time shall, by virtue of the
Merger and without any action on the part of the holder thereof, be converted
into and exchanged for one share of the common stock of the Surviving
Corporation.
5
<PAGE> 6
SECTION 2.8 Stockholders' Meeting.
If required by applicable law in order to consummate the Merger, the
Company, acting through its Board of Directors, shall, in accordance with
applicable law:
(a) duly call, give notice of, convene and hold a special meeting (the
"Special Meeting") of its stockholders as soon as practicable following the
expiration of the Offer for the purpose of adopting this Agreement;
(b) include in the Proxy Statement or Information Statement (as defined in
Section 4.7 hereof) (i) the recommendation of its Board of Directors that
stockholders of the Company vote in favor of the approval and adoption of this
Agreement and (ii) the opinion of Raymond James referred to in Section 1.2
hereof; and
(c) use its best efforts (i) to obtain and furnish the information required
to be included by it in the Proxy Statement or the Information Statement and,
after consultation with the Sub, respond promptly to any comments made by the
SEC with respect to the Proxy Statement or the Information Statement and any
preliminary version thereof and cause the Proxy Statement or the Information
Statement to be mailed to its stockholders at the earliest practicable time
following the expiration of the Offer, and (ii) to obtain the necessary approval
of the Merger by its stockholders. The Purchaser agrees that, at the Special
Meeting, all of the Shares acquired by Purchaser, the Sub or any other affiliate
of Purchaser pursuant to the Offer, the Stockholder Agreements or otherwise will
be voted in favor of the Merger.
SECTION 2.9 Merger Without Meeting of Stockholders.
Notwithstanding the foregoing, in the event that Purchaser, the Sub or any
other direct or indirect subsidiary of Purchaser shall own or acquire at least
90 percent of the outstanding Shares, the parties hereto agree to take all
necessary and appropriate action to cause the Merger to become effective, as
soon as practicable after the expiration of the Offer, but in no event later
than five business days thereafter, without a meeting of stockholders of the
Company, in accordance with Section 253 of the GCL.
SECTION 2.10 Merger Closing.
Upon the terms and subject to the conditions hereof (including satisfaction
or waiver, if permissible, of the conditions set forth in Article VII), as soon
as practicable after consummation of the Offer, and if required by law, after
the vote of the stockholders of the Company in favor of the adoption of this
Agreement has been obtained, the Company (or the Sub or Purchaser, if
appropriate) shall execute in the manner required by the GCL and deliver to the
Delaware Secretary of State a duly executed and verified certificate of merger,
and the parties shall take all such other and further actions as may be required
by law to make the Merger effective. Prior to the filing referred to in this
Section, a closing (the "Merger Closing") will be held at the office of Andrews
& Kurth L.L.P., 425 Lexington Avenue, New York, New York (or such other place as
the parties may agree) for the purpose of confirming all the foregoing.
ARTICLE III
DISSENTING SHARES; EXCHANGE OF SHARES
SECTION 3.1 Dissenting Shares.
Notwithstanding anything in this Agreement to the contrary, in the event
that dissenters' rights are available in connection with the Merger pursuant to
Section 262 of the GCL, Shares that are issued and outstanding immediately prior
to the Effective Time and that are held by stockholders who did not vote in
favor of the Merger and comply with all of the relevant provisions of Section
262 of the GCL (the "Dissenting Shares") shall not be converted into or be
exchangeable for the right to receive the Merger Consideration, unless and until
such holders shall have failed to perfect or shall have effectively withdrawn or
lost such right, such holder's Shares shall thereupon be deemed to have been
converted into and to have become exchangeable for the right to receive, as of
the Effective Time, the Merger Consideration without any interest
6
<PAGE> 7
thereon. The Company shall give the Sub (i) prompt notice of any written demands
for appraisal of Shares received by the Company and (ii) the opportunity to
direct all negotiations and proceedings with respect to any such demands. The
Company shall not, without the prior consent of the Sub, voluntarily make any
payment with respect to, or settle or offer to settle, any such demands.
SECTION 3.2 Exchange of Shares.
(a) The Sub shall deposit in trust with an exchange agent reasonably
acceptable to the Board of Directors of the Company (excluding any designee of
the Sub) to be selected by the Sub (the "Exchange Agent") immediately prior to
the Effective Time cash in an aggregate amount necessary to make the payments
pursuant to Section 2.6 hereof to holders (other than the Sub or Purchaser or
any of their respective Subsidiaries or affiliates) of Shares (such amount being
hereinafter referred to as the "Exchange Fund"), and to make the appropriate
cash payments, if any, to holders of Dissenting Shares. The Exchange Agent
shall, pursuant to irrevocable instructions, make the payments provided for in
the preceding sentence out of the Exchange Fund. The Exchange Agent shall invest
portions of the Exchange Fund as the Sub directs, provided that all such
investments shall be in obligations of or guaranteed by the United States of
America, in commercial paper obligations receiving the highest rating from
either Moody's Investors Services, Inc. or Standard & Poor's Corporation, or in
certificates of deposit, bank repurchase agreements or banker's acceptances of
commercial banks with capital exceeding $500 million (collectively, "Permitted
Investments"); provided, however, that the maturities of Permitted Investments
shall be such as to permit the Exchange Agent to make prompt payment to former
stockholders of the Company entitled thereto as contemplated by this Section.
The Sub shall promptly replenish the Exchange Fund to the extent of any losses
incurred as a result of Permitted Investments. All earnings on Permitted
Investments shall be paid to the Sub. If for any reason (including losses) the
Exchange Fund is inadequate to pay the amounts to which holders of Shares shall
be entitled under this Section 3.2, the Sub shall in any event be liable for
payment thereof. The Exchange Fund shall not be used except as provided in this
Agreement.
(b) As soon as practicable after the Effective Time, the Surviving
Corporation shall cause the Exchange Agent to mail to each record holder, as of
the Effective Time, of an outstanding certificate or certificates which
immediately prior to the Effective Time represented Shares (the "Certificates"),
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 instructions for
use in effecting the surrender of the Certificate or payment therefor. Upon
surrender to the Exchange Agent of a Certificate, together with such letter of
transmittal duly executed, the holder of such Certificate shall be paid in
exchange therefor cash in an amount equal to the product of the number of Shares
represented by such Certificate multiplied by the Merger Consideration, and such
Certificate shall forthwith be cancelled. No interest will be paid or accrued on
the cash payable upon the surrender of the Certificates. If payment is to be
made to a person other than the person in whose name the Certificate surrendered
is registered, it shall be a condition of payment that the Certificate so
surrendered shall be properly endorsed or otherwise in proper form for transfer
and that the person requesting such payment shall pay any transfer or other
taxes required by reason of the payment to a person other than the registered
holder of the Certificate surrendered or establish to the satisfaction of the
Surviving Corporation that such tax has been paid or is not applicable. After
the Effective Time, until surrendered in accordance with the provisions of this
Section 3.2, each Certificate (other than Certificates representing Shares owned
by the Sub or any affiliate of the Sub, and Dissenting Shares) shall represent
for all purposes solely the right to receive the Merger Consideration in cash
multiplied by the number of Shares evidenced by such Certificate, without any
interest thereon. From and after the Effective Time, holders of Certificates
immediately prior to the Merger will have no right to vote or to receive any
dividends or other distributions with respect to any Shares which were
theretofore represented by such Certificates, other than any dividends or other
distributions payable to holders of record as of a date prior to the Effective
Time, and will have no other rights other than as provided herein or by law.
(c) After the Effective Time, there shall be no transfers of Shares that
were outstanding immediately prior to the Effective Time on the stock transfer
books of the Surviving Corporation. If, after the Effective Time, Certificates
are presented to the Surviving Corporation, they shall be cancelled and
exchanged for cash
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as provided in this Article III. At the close of business on the day of the
Effective Time the stock ledger of the Company shall be closed.
(d) Any portion of the Exchange Fund (including the proceeds of any
investments thereof) that remains unclaimed by the stockholders of the Company
for six months after the Effective Time shall be repaid to the Surviving
Corporation and holders of Certificates shall thereafter look only to the
Surviving Corporation as general creditors thereof for payment of any Merger
Consideration payable upon due surrender of their Certificates. Notwithstanding
the foregoing, neither the Sub nor the Surviving Corporation shall be liable to
a holder of a Certificate for amounts delivered to a public official pursuant to
any applicable abandoned property, escheat or similar laws.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF THE COMPANY
The Company represents and warrants to Purchaser and the Sub as of the date
of this Agreement as follows:
SECTION 4.1 Organization and Qualification.
The Company is a corporation duly organized, validly existing and in good
standing under the laws of its jurisdiction of organization and has the
requisite power and authority to own, lease and operate its assets and
properties and to carry on its business as it is now being conducted. The
Company is duly qualified to do business, and is in good standing, in each
jurisdiction in which the property currently owned, leased or operated by it or
the nature of the businesses conducted by it makes such qualification necessary,
except where the failure to be so qualified and in good standing would not have
a Material Adverse Effect (as defined in Section 9.11(b) below) on the Company.
The Company has furnished Purchaser true and correct copies of the certificate
of incorporation and bylaws, as amended to the date hereof, of the Company. The
Company's certificate of incorporation and bylaws as so delivered are in full
force and effect.
SECTION 4.2 Capitalization.
The authorized capital stock of the Company consists of 7,000,000 Shares.
All of the outstanding shares of capital stock of the Company have been duly
authorized and validly issued and are fully paid and nonassessable and free of
preemptive rights. Except as set forth in the Disclosure Schedule, all
outstanding shares of capital stock of, or other ownership interests in, each of
the Subsidiaries of the Company have been validly issued, are (in the case of
capital stock) fully paid and nonassessable and (in the case of partnership
interests) not subject to current or future capital calls, and are owned by the
Company or a wholly owned Subsidiary of the Company, free and clear of all
liens, charges, encumbrances, equities, claims and options of any nature. As of
May 31, 1996, there were 3,701,505 Shares issued and outstanding, 400,000 Shares
reserved for issuance upon exercise of outstanding Options to acquire Shares,
300,000 Shares reserved for issuance under the Company's 401(k) Plan (the
"401(k) Plan") and 110,000 warrants outstanding, each representing the right to
purchase from the Company on or prior to December 12, 1996, one Share at a price
of $8.75 per Share. Since such date, the Company has not issued any additional
shares of capital stock other than pursuant to the exercise of Options or
pursuant to the provisions of the 401(k) Plan. Except as set forth in the
Disclosure Schedule, there are not as of the date hereof and at the Effective
Time there will not be any outstanding or authorized subscriptions, options,
warrants, calls, rights, contracts, voting trusts, proxies, commitments or any
other agreements of any character (any of the foregoing a "Commitment")
obligating the Company to issue any additional Shares or any other shares of
capital stock of the Company or any other securities convertible into or
evidencing the right to subscribe for any such shares. Except as set forth in
the Disclosure Schedule or as required by the terms of the 401(k) Plan, there
are no Commitments to which the Company or any of its Subsidiaries is a party or
by which any of them is bound relating to the issued or unissued capital stock
or other securities of any subsidiary of the Company.
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SECTION 4.3 Subsidiaries.
Each direct and indirect material Subsidiary of the Company is a
corporation duly organized, validly existing and in good standing under the laws
of its jurisdiction of incorporation and has the requisite power and authority
to own, lease and operate its assets and properties and to carry on its business
as it is now being conducted. Each of such Subsidiaries is qualified to do
business, and is in good standing, in each jurisdiction in which the properties
owned, leased or operated by it or the nature of the business conducted by it
makes such qualification necessary, except where the failure to be so qualified
and in good standing would not have a Material Adverse Effect. All of the
outstanding shares of capital stock of each Subsidiary are validly issued, fully
paid, nonassessable and free of preemptive rights, and are owned directly or
indirectly by the Company free and clear of any liens, claims, encumbrances,
security interests, equities, charges and options of any nature whatsoever.
There are no outstanding subscriptions, options, warrants, rights, calls,
contracts, voting trusts, proxies or other commitments, understandings,
restrictions or arrangements relating to the issuance, sale, voting, transfer,
ownership or other rights affecting any shares of capital stock of any
Subsidiary of the Company, including any right of conversion or exchange under
any outstanding security, instrument or agreement. The Company has furnished
Purchaser true and correct copies of the certificate of incorporation and
bylaws, as amended to the date hereof, of each of the Subsidiaries of the
Company. The certificate of incorporation and bylaws of each of the Subsidiaries
of the Company as so delivered are in full force and effect.
SECTION 4.4 Authority Relative to this Agreement.
The Company has full corporate power and authority to execute and deliver
this Agreement and to consummate the transactions contemplated hereby. The
execution and delivery of this Agreement by the Company and the consummation by
the Company of the transactions contemplated hereby have been duly and validly
authorized by the Board of Directors of the Company and, subject to the approval
of the Company's stockholders, if required, no other corporate proceedings on
the part of the Company are necessary to authorize this Agreement or to
consummate the transactions so contemplated. This Agreement has been duly and
validly executed and delivered by the Company and, assuming this Agreement
constitutes a valid and binding obligation of each of the other parties hereto,
this Agreement constitutes a valid and binding agreement of the Company,
enforceable against the Company.
SECTION 4.5 Absence of Certain Changes.
Except as disclosed in the Company's filings and reports under the Exchange
Act (the "Company Reports"), since March 31, 1996, the Company has not suffered
any Material Adverse Effect. Except as disclosed in the Company's filings and
reports under the Exchange Act or as set forth in the Disclosure Schedule or
otherwise disclosed to the Sub by the Company prior to execution of this
Agreement in a writing that makes express reference to this Section 4.5, since
March 31, 1996, there has not been (a) any declaration, setting aside or payment
of any dividend or other distribution in respect of the Shares or any redemption
or other acquisition by the Company of any shares of its capital stock; (b) any
increase in the rate or terms of compensation payable or to become payable by
the Company or any of its material Subsidiaries to their respective directors,
officers or key employees, except increases occurring in the ordinary course of
business in accordance with its customary practices (which shall include normal
periodic performance reviews and related compensation and benefit increases);
(c) any increase in the rate or terms of any bonus, insurance, pension or other
employee benefit plan, payment or arrangement made to, for or with any such
directors, officers or key employees, except increases occurring in the ordinary
course of business in accordance with its customary practices (which shall
include normal periodic performance reviews and related compensation and benefit
increases); (d) any entry into any agreement, commitment or transaction by the
Company which is material to the Company and its Subsidiaries taken as a whole,
except as contemplated by this Agreement or agreements, commitments or
transactions in the ordinary course of business consistent with past practice;
(e) any modification of any existing material agreement or commitment which
would increase the Company's or any Subsidiary's obligations (financial or
otherwise) in respect thereof in any material respect; or (f) any
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change by the Company in accounting methods, principles or practices, except as
required or permitted by generally accepted accounting principles.
SECTION 4.6 Reports.
(a) Since June 30, 1994 the Company has filed all required forms, reports
and documents with the SEC required to be filed by it pursuant to the federal
securities laws and the SEC rules and regulations thereunder, all of which have
complied as to form as of their respective filing dates in all material respects
with all applicable requirements of the Securities Act of 1933 (the "Securities
Act") and the Exchange Act, and the rules promulgated thereunder. The Company's
registration statement on Form S-1, Registration File No. 333-06009, filed with
the SEC on June 14, 1996, including without limitation any financial statements
or schedules included therein, at the time filed, did not contain any untrue
statement of a material fact or omit to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the circumstances under which they were made, not misleading.
(b) The consolidated balance sheets and the related consolidated statements
of operations and of cash flows (including the related notes thereto) of the
Company included in the Company's Annual Report on Form 10-K for the fiscal year
ended June 30, 1995, and in the Company's Quarterly Reports on Form 10-Q for the
quarters ended September 30, 1995, December 31, 1995 and March 31, 1996, present
fairly the consolidated financial position of the Company as of their respective
dates, and the results of its consolidated operations and its consolidated cash
flows for the periods presented therein, all in conformity with generally
accepted accounting principles applied on a consistent basis (subject, in the
case of the unaudited interim financial statements, to normal year-end
adjustments), except as otherwise noted therein.
SECTION 4.7 Offer Documents; Proxy Statements; Schedule 14D-9; Other
Information.
If a proxy statement or an information statement is required for the
consummation of the Merger under applicable law (the "Proxy Statement" and
"Information Statement," respectively), the Proxy Statement or Information
Statement, as the case may be, will comply in all material respects with the
Exchange Act, except that no representation is made by the Company with respect
to information supplied by Purchaser or the Sub or any affiliate of Purchaser or
the Sub for inclusion in the Proxy Statement or Information Statement. None of
the information in the Proxy Statement or Information Statement, as the case may
be (other than information supplied by Purchaser or the Sub for inclusion
therein), will, at the time the Proxy Statement or Information Statement is
mailed, or, at the time of the Special Meeting, contain any untrue statement of
a material fact or omit to state any material fact required to be stated therein
or necessary in order to make the statements therein, in light of the
circumstances under which they were made, not misleading. The Schedule 14D-9
will comply as to form in all material respects with the applicable requirements
of the Exchange Act and the rules and regulations thereunder and will not, at
the respective times the Schedule 14D-9 or any amendments or supplements thereto
are filed with the SEC, contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under which they
were made, not misleading. The Company will promptly correct any statements in
the Schedule 14D-9 that have become materially false or misleading and take all
steps necessary to cause such Schedule 14D-9 as so corrected to be filed with
the SEC and to be disseminated to holders of Shares, in each case as and to the
extent required by applicable law. None of the information relating to the
Company and its Subsidiaries supplied in writing by the Company specifically for
inclusion in the Offer Documents, including any amendments or supplements
thereto, or any schedules required to be filed with the SEC in connection
therewith, will, at the respective times the Offer Documents or any amendments
or supplements thereto or any such schedules are filed with the SEC, contain any
untrue statement of a material fact or omit to state any material fact required
to be stated therein or necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading. The
letter to stockholders, notice of meeting, Proxy Statement and form of proxy, or
the Information Statement, as the case may be, to be distributed to stockholders
in connection with the Merger, and any schedules required to be filed with the
SEC in connection therewith, are collectively referred to elsewhere in this
Agreement as the "Proxy Statement".
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SECTION 4.8 Consents and Approvals; No Violation.
Neither the execution and delivery of this Agreement by the Company nor the
consummation of the transactions contemplated hereby will (i) conflict with or
result in any breach of any provision of the respective certificates of
incorporation or by-laws (or other similar governing documents) of the Company
or any of its Subsidiaries; (ii) require any consent, approval, authorization or
permit of, or filing with or notification to, any governmental or regulatory
authority, except (A) in connection with the HSR Act, (B) pursuant to the
Exchange Act, (C) the filing of a certificate of merger pursuant to the GCL or
similar filings under any other applicable law, (D) any consents, approvals,
authorizations or permits, filings or notifications required to be given or made
to any foreign jurisdiction, (E) any regulatory or routine governmental consents
normally acquired after the consummation of transaction such as transactions of
the nature contemplated by this Agreement, or (F) 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 on the
Company and would not prevent or delay in any material respect the consummation
of the transactions contemplated hereby; (iii) except as set forth in the
Disclosure Schedule, result in a default (or give rise to any right of
termination, cancellation or acceleration) or result in the creation of any lien
or other encumbrance upon any of the properties or assets of the Company or any
of its Subsidiaries under any of the terms, conditions or provisions of any
note, indenture, mortgage, deed of trust, lease, license, agreement or other
instrument or obligation to which the Company or any of its Subsidiaries is a
party or by which the Company or any of its Subsidiaries or any of their
respective assets or properties may be bound, except for such defaults (or
rights of termination, cancellation, or acceleration) as to which requisite
waivers or consents have been obtained or will be obtained prior to acceptance
for payment of Shares by the Sub pursuant to the Offer or which, except for such
liens or other encumbrances in the aggregate, would not have a Material Adverse
Effect on the Company and would not prevent or delay in any material respect the
consummation of the transactions contemplated hereby; or (iv) violate any order,
writ, injunction, decree, statute, rule or regulation applicable to the Company,
any of its Subsidiaries or any of their respective assets, except for violations
which would not in the aggregate have a Material Adverse Effect on the Company
and would not prevent or delay in any material respect the consummation of the
transactions contemplated hereby.
SECTION 4.9 Brokerage Fees and Commission.
Except for those fees and expenses payable to Raymond James pursuant to the
letter agreement dated June 3, 1996 (a copy of which has previously been
delivered to Purchaser), no person or entity is entitled to receive from the
Company or any of its Subsidiaries, or Purchaser or the Sub any investment
banking, financial advisory, brokerage or finder's fee in connection with this
Agreement or the transactions contemplated hereby as a result of any agreements
or undertakings of the Company or any of its Subsidiaries.
SECTION 4.10 Employment Agreements.
Except as disclosed in the Company Reports or as disclosed in the
Disclosure Schedule hereto, there exist no employment, consulting, severance or
indemnification agreements between the Company and any current director,
officer, or employee of the Company or any of its Subsidiaries.
SECTION 4.11 Litigation, etc.
As of the date hereof, except as disclosed in the Company Reports or as
disclosed in the Disclosure Schedule hereto, there is no claim, action, or
proceeding pending or, to the best knowledge of the Company, threatened against
or relating to the Company or any Subsidiaries before any court or governmental
or regulatory authority or body acting in an adjudicative capacity with respect
to which there is a reasonable likelihood of a determination that would have a
Material Adverse Effect on the Company or would prevent or delay in any material
respect the consummation of the transactions contemplated hereby. Neither the
Company nor any of its Subsidiaries is subject to any outstanding order, writ,
injunction or decree that would have a Material Adverse Effect on the Company or
would prevent or delay in any material respect the consummation of the
transactions contemplated hereby.
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SECTION 4.12 Absence of Undisclosed Liabilities.
Except as disclosed in the Company Reports or as disclosed in the
Disclosure Schedule hereto, neither the Company nor any of its Subsidiaries had
at March 31, 1996, or has incurred since that date, any liabilities or
obligations (whether absolute, accrued, contingent or otherwise) of any nature,
except liabilities, obligations or contingencies (a) which are accrued or
reserved against in the Company's financial statements or reflected in the notes
thereto or (b) which were incurred after March 31, 1996, and were incurred in
the ordinary course of business and consistent with past practices and, in
either case, except for any such liabilities, obligations or contingencies which
(i) would not, in the aggregate, have a Material Adverse Effect on the Company,
(ii) have been discharged or paid in full prior to the date hereof or (iii)
would not be required to be disclosed in the Company's financial statements or
the notes thereto.
SECTION 4.13 No Violation of Law.
Except as disclosed in the Company Reports or as disclosed on the
Disclosure Schedule hereto, neither the Company nor any of its Subsidiaries is
in violation of, or, to the knowledge of the Company, is under investigation
with respect to or has been given notice or been charged with any violation of,
any law, statute, order, rule, regulation, ordinance, or judgment of any
governmental or regulatory body or authority, except for violations which in the
aggregate do not have a Material Adverse Effect. The Company and its
Subsidiaries have all governmental permits, licenses, franchises and other
governmental authorizations, consents and approvals (the "Company Government
Approvals") necessary to conduct their businesses as presently conducted, except
those which the failure to obtain would not in the aggregate have a Material
Adverse Effect on the Company, and all such Company Government Approvals shall
continue in full force and effect after the Merger.
SECTION 4.14 Compliance with Agreements.
Except as disclosed in the Company Reports or in the Disclosure Schedule
hereto, the Company and each of its Subsidiaries are not in breach or violation
of or in default in the performance or observance of any term or provision of,
and no event has occurred which, with lapse of time or action by a third party
(or both), could result in a default under, (i) the respective charters or
by-laws of the Company or any of its Subsidiaries or (ii) any contract,
commitment, agreement, indenture, mortgage, loan agreement, note, lease, bond,
license, approval or other instrument to which the Company or any of its
Subsidiaries is a party or by which any of them is bound or to which any of
their property is subject, which breaches, violations and defaults, in the case
of clause (ii) of this Section 4.14 would have, in the aggregate, a Material
Adverse Effect on the Company.
SECTION 4.15 Certain Other Laws and Regulations.
Except as disclosed in the Disclosure Schedule, neither the Company nor any
of its Subsidiaries has violated any foreign, federal, state or local law or
regulation relating to the protection of human health and safety, the
environment or hazardous or toxic substances or wastes, pollutants or
contaminants ("Environmental Laws"), nor any federal or state law relating to
discrimination in the hiring, promotion or pay of employees nor any applicable
federal or state wages and hours laws, nor any provisions of the Employee
Retirement Income Security Act of 1974, as amended ("ERISA") or the rules and
regulations promulgated thereunder, which in each case might result in any
Material Adverse Effect on the Company.
SECTION 4.16 Tax Returns.
Except as may otherwise be permitted herein, all federal, state, local and
other tax returns and reports of the Company and each of its Subsidiaries
required by law have been completed in full and have been duly filed, and all
taxes, assessments and withholdings shown on such returns or billed to the
Company and its Subsidiaries have been paid, and the Company and its
Subsidiaries maintain adequate provisions and accruals in respect of all such
federal, state, local and other taxes, assessments and withholdings. There are
no unpaid assessments pending against the Company or any of its Subsidiaries for
any taxes or withholdings, and the Company knows of no basis therefor.
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SECTION 4.17 ERISA Compliance.
All Defined Benefit Pension Plans, as defined in ERISA, of the Company and
its Subsidiaries meet, as of the date hereof, the minimum funding standards of
Section 302 of ERISA and no reportable event or prohibited transaction as
defined in ERISA has occurred.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PARENT AND THE PURCHASER
Purchaser and the Sub represent and warrant to the Company as follows:
SECTION 5.1 Organization and Qualification.
Purchaser is a limited partnership and the Sub is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Delaware and each has the requisite power to carry on its business as it is now
being conducted.
SECTION 5.2 Authority Relative to this Agreement.
Each of Purchaser and the Sub has full power and authority to execute and
delivery this Agreement and to consummate the transactions contemplated hereby.
The execution and delivery by Purchaser and the Sub of this Agreement and the
consummation by Purchaser and the Sub of the transactions contemplated hereby
have been duly and validly authorized by the General Partner of Purchaser, the
Board of Directors of the Sub and the sole stockholder of the Sub, and no other
action or proceedings on the part of the Purchaser or the Sub are necessary to
authorize this Agreement, make the Offer or consummate the transactions so
contemplated by this Agreement (including the Offer and the Merger). This
Agreement has been duly and validly executed and delivered by each of Purchaser
and the Sub and, assuming this Agreement constitutes a valid and binding
obligation of the Company, this Agreement constitutes a valid and binding
agreement of each of Purchaser and the Sub, enforceable against each of
Purchaser and the Sub, except as the enforceability hereof may be limited by
bankruptcy, insolvency, reorganization, moratorium or other laws relating to or
affecting creditors' rights generally, or by general principles of equity
(regardless of whether enforcement is considered in a proceeding in equity or at
law).
SECTION 5.3 Information Provided.
None of the information supplied by Purchaser and its affiliates
specifically for inclusion in the Proxy Statement, the Information Statement or
the Schedule 14D-9 will, at the time such materials are mailed, or, at the time
of the Special Meeting, contain any untrue statement of a material fact or omit
to state any material fact required to be stated therein or necessary in order
to make the statements therein, in light of the circumstances under which they
were made, not misleading except that no representation or warranty is made by
Purchaser or the Sub with respect to statements made or incorporated by
reference therein based on information contained in any filing made by the
Company with the SEC pursuant to the Exchange Act or supplied by the Company
specifically for inclusion or incorporation by reference therein. The Offer
Documents will comply as to form in all material respects with the requirements
of the Exchange Act and the rules and regulations promulgated thereunder.
SECTION 5.4 Consents and Approvals; No Violation.
Neither the execution and delivery of this Agreement by Purchaser and the
Sub nor the consummation of the transactions contemplated hereby will (i)
conflict with or result in any breach of any provision of the respective
certificates of incorporation or by-laws (or other similar governing documents)
of Purchaser or the Sub or any of their affiliates; (ii) require any consent,
approval, authorization or permit of, or filing with or notification to, any
governmental or regulatory authority, except (A) in connection with the HSR Act,
(B) pursuant to the Exchange Act, (C) the filing of a certificate of merger
pursuant to the GCL or similar filings under any other applicable law, (D) any
regulatory or routine governmental consents normally acquired
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after the consummation of transaction such as transactions of the nature
contemplated by this Agreement or (E) 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 on Purchaser or the Sub;
(iii) result in a default (or give rise to any right of termination,
cancellation or acceleration) or result in the creation of any lien or other
encumbrance upon any of the properties or assets of Purchaser or any of its
affiliates under any of the terms, conditions or provisions of any note,
indenture, mortgage, deed of trust, lease, license, agreement or other
instrument or obligation to which Purchaser or any of its affiliates is a party
or by which Purchaser or any of its affiliates or any of their respective assets
or properties may be bound, except for such defaults (or rights of termination,
cancellation or acceleration) as to which requisite waivers or covenants have
been obtained or which, in the aggregate, would not have in the aggregate a
Material Adverse Effect on Purchaser or the Sub; or (iv) violate any order,
writ, injunction, decree, statute, rule or regulation applicable to Purchaser,
any of its affiliates or any of their respective assets, except for violations
which would not have in the aggregate a Material Adverse Effect on Purchaser.
SECTION 5.5 Financing.
Purchaser has furnished to the Company copies of commitments to provide
equity capital to Purchaser. The amounts that Purchaser may obtain under such
commitments will be sufficient to provide all funds necessary to consummate the
Offer, the Merger and the transactions contemplated thereby including, without
limitation, the purchase of all the outstanding Shares (on a fully diluted
basis) and to pay the related fees and expenses of Purchaser and the Sub.
SECTION 5.6 Brokerage Fees and Commissions.
No person or entity is entitled to receive from the Company or any of its
Subsidiaries, the Sub or Purchaser, any investment banking, brokerage or
finder's fee in connection with this Agreement or the transactions contemplated
hereby as a result of any agreements or undertakings of the Sub or Purchaser.
SECTION 5.7 Litigation, etc.
As of the date hereof, there is no claim, action, or proceeding pending or,
to the best knowledge of the executive officers of Purchaser, threatened against
or relating to Purchaser or the Sub before any court or governmental or
regulatory authority or body acting in an adjudicative capacity with respect to
which there is a reasonable likelihood of a determination that would have a
Material Adverse Effect on Purchaser or the Sub or would prevent or delay in any
material respect the consummation of the transactions contemplated hereby.
Neither Purchaser nor the Sub is subject to any outstanding order, writ,
injunction or decree that would have a Material Adverse Effect on Purchaser or
the Sub or would prevent or delay in any material respect the consummation of
the transactions contemplated hereby.
SECTION 5.8 Interim Operations of the Sub.
The Sub was formed solely for the purpose of engaging in the transactions
contemplated hereby and has not engaged in any business activities or conducted
any operations other than in connection with the transactions contemplated
hereby.
ARTICLE VI
COVENANTS
SECTION 6.1 Conduct of Business of the Company.
Except as set forth in the Disclosure Schedule or as otherwise contemplated
by this Agreement, after the date hereof and prior to the Effective Time or
earlier termination of this Agreement, unless Purchaser shall otherwise agree in
writing (it being agreed, however, that the Company shall be solely responsible
for its
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operations and those of its Subsidiaries in accordance with the provisions of
this Agreement), the Company shall and shall cause each of its Subsidiaries to:
(a) conduct their respective businesses only in, and not take any action
except in, the ordinary and usual course of business and consistent with past
practice;
(b) not (i) amend or propose to amend their respective charters or by-laws;
(ii) split, combine or reclassify their outstanding capital stock or otherwise
change their capitalization or declare, set aside or pay any dividend or
distribution payable in cash, stock, property, securities or otherwise; or (iii)
knowingly take any action which would result in a failure to maintain the
trading of Company's Common Stock on the NASDAQ Stock Market;
(c) not (i) authorize the issuance of, or issue, sell, pledge or dispose
of, or agree to issue, sell, pledge or dispose of, any additional shares of, or
any options, warrants or rights of any kind to acquire any shares of, their
capital stock of any class or any debt or equity securities convertible into or
exchangeable for such capital stock, (ii) sell (including, without limitation,
by sale/leaseback), pledge, dispose of, license or encumber any material assets
(including without limitation intellectual property), or any interests therein,
other than in the ordinary course of business and consistent with past practice;
(iii) redeem, purchase, acquire or offer to purchase or acquire any (x) shares
of its capital stock, other than in accordance with the governing terms of such
securities or (y) long-term debt, other than as required by the governing
instruments relating thereto; or (iv) enter into any contract, agreement,
commitment or arrangement with respect to any of the foregoing;
(d) use their best efforts to preserve intact their respective business
organizations and goodwill, keep available the services of their respective
present officers and key employees, and preserve the goodwill and business
relationships with suppliers, distributors, customers and others having business
relationships with them;
(e) confer on a regular and frequent basis with one or more representatives
of Purchaser to discuss operational matters of materiality and the general
status of ongoing operations;
(f) promptly notify Purchaser of any significant changes in the business,
financial condition or results of operations of the Company or its Subsidiaries
taken as a whole;
(g) not acquire, or publicly propose to acquire, all or any substantial
part of the business and properties or capital stock of any person not a party
to this Agreement, whether by merger, purchase of assets, tender offer or
otherwise;
(h) not enter into or amend any employment, severance, special pay
arrangement with respect to termination of employment or other similar
arrangements or agreements with any directors, officers or key employees;
(i) not adopt, enter into or amend any bonus, profit sharing, compensation
(except ordinary course salary adjustments consistent with historic practice),
severance, termination, stock option, pension, retirement, deferred
compensation, health care, change in control agreement, restricted stock,
employment or other employee benefit plan, agreement, trust, fund or arrangement
for the benefit or welfare of any employee, officer, director or retiree, or
increase in any manner the compensation or fringe benefits of any director or
officer or pay any benefit not required by any existing plan, arrangement or
contract (including, without limitation, the granting of stock options, stock
appreciation rights, shares of restricted stock or performance units) or take
any action or grant any benefit not expressly required under the terms of any
existing contracts, trusts, plans, funds or other such arrangements or enter
into any contract to do any of the foregoing, except as required to comply with
changes in applicable law occurring after the date hereof, except with the prior
written approval of Purchaser;
(j) maintain with financially responsible insurance companies, insurance on
its tangible assets and its businesses in such amounts and against such risks
and losses as are consistent with past practice;
(k) not enter into any material arrangement, agreement, or contract with
any third party (other than customers in the ordinary course of business) which
provides for an exclusive arrangement with that third
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party or is substantially more restrictive on the Company or substantially less
advantageous to the Company than arrangements, agreements, or contracts existing
on the date hereof;
(l) not establish any new lines of credit or other credit facilities; incur
any indebtedness other than pursuant to existing credit facilities except for
trade liabilities incurred in the ordinary course of business; assume,
guarantee, endorse or otherwise become liable (whether directly, contingently or
otherwise) for the obligation of any other person except in the ordinary course
of business and consistent with past practice; make any loans, advances or
capital contributions to, or investments (other than intercompany accounts and
short-term investments pursuant to customary cash management systems of the
Company in the ordinary course of business and consistent with past practice)
in, any other person other than such of the foregoing as are made by the Company
to or in a wholly-owned subsidiary of the Company; and
(m) not agree in writing, or otherwise, to take any of the foregoing
actions or any other action which would make any representation or warranty
contained in Article IV untrue or incorrect in any material respect as of the
time of the Closing.
SECTION 6.2 Access to Information.
Between the date of this Agreement and the Effective Time, the Company will
(i) give Purchaser and its authorized representatives access during regular
business hours upon reasonable notice to all offices, facilities and properties
and to all books and records of the Company, (ii) permit Purchaser and such
other persons to make such inspections as it may require and (iii) cause its
officers and those of its Subsidiaries to furnish Purchaser with such financial
and operating data and other information with respect to the business and
properties of the Company and its Subsidiaries as Purchaser may from time to
time reasonably request.
SECTION 6.3 Reasonable Best Efforts.
Subject to the terms and conditions herein provided for the Company, and to
the fiduciary duties of the Board of Directors of the Company under applicable
laws, each of the parties hereto agrees to use its reasonable best efforts to
take, or cause to be taken, all appropriate 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 voting by the Purchaser of
the Shares in favor of the Merger. In case at any time after the Effective Time
any further action is necessary or desirable to carry out the purposes of this
Agreement, the proper officers and directors of each party to this Agreement
shall take all such necessary action. The Sub agrees that, in the event that it
is unable to consummate the Offer at the scheduled expiration thereof due to the
entry of an order or injunction of a preliminary nature described in clause (b)
of Exhibit A hereto or due to the failure to receive any required clearance
under the HSR Act, it shall extend the Offer until the earlier of (a) December
31, 1996 or (b) such time as such order or injunction becomes final and all
means of appeal and all appeals of such order or injunction have been finally
exhausted.
SECTION 6.4 State Takeover Statutes.
The Company will use its reasonable best efforts to (a) exempt the Company,
the Offer, the Stockholder Agreements and the Merger from the requirements of
any state takeover law by action of the Company's Board of Directors or
otherwise and (b) assist in any challenge by the Sub to the validity or
applicability to the Offer or the Merger of any state takeover law.
SECTION 6.5 Proxy Statement/Information Statement.
As soon as reasonably practicable after the date hereof, the Company will,
if required by applicable law in order to consummate the Merger, prepare the
Proxy Statement or the Information Statement, as the case may be, file it with
the Commission and mail it to all holders of Shares. Purchaser, the Sub and the
Company will cooperate with each other in the preparation of the Proxy Statement
or the Information Statement, as the case may be; without limiting the
generality of the foregoing, Purchaser and the Sub will furnish to the Company
the information relating to Purchaser and the Sub required by the Exchange Act
to be set forth in the Proxy
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Statement or the Information Statement, as the case may be. The Company, acting
through its Board of Directors, subject to the fiduciary duties of the Company's
Board of Directors as advised by counsel, will include in the Proxy Statement or
the Information Statement, as the case may be, the recommendation of its Board
of Directors that stockholders of the Company vote in favor of the adoption of
this Agreement and use its reasonable best efforts to secure such adoption.
SECTION 6.6 Indemnification and Insurance.
(a) From and after the earlier of the Control Date (as defined below) or
the Effective Time, Purchaser shall cause the Company to maintain all rights to
indemnification now existing in favor of the current or former directors,
officers, employees, fiduciaries and agents of the Company and its Subsidiaries
as provided in their respective certificates of incorporation or by-laws, with
such rights to survive the Offer and Merger and continue in full force and
effect in accordance with their respective terms for a period of not less than
six years from the Effective Time; provided, however, that in the event any
claim or claims are asserted or made within such six year period, all such
rights shall continue until final disposition of any such claim or claims. As
used herein, the term "Control Date" shall mean the earliest date on which the
Company shall have elected such number of directors designated by the Sub
pursuant to Section 1.3 hereof as is equal to at least a majority of the total
number of directors on the Board of Directors of the Company.
(b) From and after the earlier of the Control Date or the Effective Time,
Purchaser shall cause the Company to maintain in effect for not less than three
years after the Effective Time the current policies of directors' and officers'
liability insurance maintained by the Company and its Subsidiaries (or a
substitute policy providing at least the same coverage and containing terms and
conditions that are no less advantageous) to the extent available on
commercially reasonable terms; provided, that Purchaser and the Company shall
not be required to pay premiums for such insurance policies in excess of 133% of
the premiums currently paid by the Company; and provided, further, that if
Purchaser or the Company is unable to maintain or obtain such insurance coverage
as required by this Section 6.6, Purchaser or the Company will maintain or
obtain, for the remainder of the three-year period, the most favorable coverage
available on commercially reasonable terms for premiums equal to 133% of the
premiums currently paid by the Company.
(c) From and after the earlier of the Control Date or the Effective Time,
Purchaser agrees to, and agrees to cause the Company to, indemnify, defend, hold
harmless and reimburse each current and former officer or director of the
Company or any of its Subsidiaries (the "Indemnified Parties") for, from and
against all losses, claims, damages, costs, expenses (including the reasonable
fees and expenses of attorneys and other professional advisers), liabilities,
judgments, fines and amounts paid in settlement ("Indemnified Liabilities")
incurred directly or indirectly in connection with any threatened or actual
claim, action, suit, proceeding or investigation, whether civil, criminal or
administrative, based in whole or in part on or arising in whole or in part out
of the fact that such person is or was a director or officer of the Company or
any of its Subsidiaries, or is or was serving at the request of the Company as a
director or officer of another corporation, partnership, joint venture or other
enterprise, whether pertaining to any matter occurring, asserted or claimed
prior to, on, or after the Effective Time; provided, however, that no
Indemnified Party shall be entitled to indemnification hereunder for any
wrongful misconduct of such Indemnified Party. Without limiting the foregoing,
in the event any such claim, action, suit, proceeding or investigation is
brought against any Indemnified Party (whether arising before or after the
Effective Time), upon delivery to Parent of an undertaking in the form described
in Section 145(c) of the GCL, (i) the Indemnified Parties may retain counsel
mutually satisfactory to them and Purchaser; (ii) Purchaser shall pay, or cause
the Company to pay, all reasonable fees and expenses of such counsel for the
Indemnified Parties promptly as statements therefor are received; and (c)
Purchaser shall use, or cause the Company to use, its best efforts to assist in
the vigorous defense of any such matter; provided, however, that neither
Purchaser nor the Company shall be liable for any settlement of any claim
effected without Purchaser's written consent, which consent, however, shall not
be unreasonably withheld. Any Indemnified Party wishing to claim indemnification
under this Section 6.6(c), upon learning of any such claim, action, suit,
proceeding or investigation, shall notify Purchaser (but the failure so to
notify Purchaser shall not relieve it from any liability that it may have under
this Section 6.6 except to the extent
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such failure materially prejudices such party), and shall deliver to Purchaser
the undertaking described in Section 145(e) of the GCL.
(d) The provisions of this Section 6.6, which shall survive the
consummation of the Offer and the Merger, are intended to be for the benefit of,
and shall be enforceable by, each Indemnified Party, his heirs and his
representatives. In the event Purchaser, the Surviving Corporation or any of
their successors or assigns (i) merges, consolidates or combines with any other
person and shall not be the continuing or surviving corporation or entity, or
(ii) transfers all or substantially all of its properties and assets to any
person, then, and in each such case, proper provisions shall be made so that the
successors and assigns of such corporation assume the obligations set forth in
this Section 6.6. All references to the Company in this Section 6.6 shall refer
to the Company, the Surviving Corporation and any of its successors or assigns.
SECTION 6.7 Public Announcements.
Prior to the Effective Time, the parties hereto shall not issue or cause
the publication of any press release or any other announcement with respect to
this Agreement or the transactions contemplated hereby without the consent of
the other parties hereto, which consent shall not be unreasonably withheld or
delayed, except where such release or announcement is required by applicable law
or any national securities exchange, in which case the party or parties will use
its or their, as the case may be, reasonable best efforts to provide a copy to
the other parties prior to any release or announcement.
SECTION 6.8 Notice of Actions and Proceedings.
The Company will promptly notify Purchaser of any actions, suits, claims,
investigations or proceedings commenced or, to the knowledge of the executive
officers of the Company, threatened in writing against, relating to or involving
or otherwise affecting the Company or any of its Subsidiaries which relates to
the consummation of the Offer or the Merger.
SECTION 6.9 Notification of Certain Other Matters.
The Company will promptly notify Purchaser of:
(a) any written notice or other written 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;
(b) any written or other written communication from any Governmental Entity
in connection with the transactions contemplated hereby; or
(c) any fact, development or occurrence that constitutes a Material Adverse
Effect on the business, financial condition or results of operations of the
Company and its Subsidiaries taken as a whole or is reasonably expected to
result in such an effort.
SECTION 6.10 Benefit Plans and Related Matters.
(a) Purchaser intends to cause the Surviving Corporation to take such
actions as are reasonably necessary so that nonunion employees of the Company
will be provided employee benefits, including life, health, accidental death and
dismemberment, and other insurance benefits, which in the aggregate are no less
favorable than those provided to such employees as of the date hereof; provided,
that it is understood that after the Effective Time neither Purchaser nor the
Surviving Corporation will have any obligation to issue or adopt any plans or
arrangements to provide for the issuance of shares of capital stock, warrants,
options, stock appreciation rights or other rights in respect of any shares of
capital stock of any entity or any securities convertible or exchangeable into
such shares pursuant to any such plan or program. To the extent that the
Surviving Corporation adopts or implements any new employee welfare or employee
benefit plan, full credit for prior service shall be given to the employees of
the Company for purposes of enrollment, qualification, entitlement to benefits
and vesting of such plans. Notwithstanding the above, nothing herein shall
require Parent to cause the Surviving Corporation to maintain any employee
benefit plans, arrangements or benefits,
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and Purchaser or the Surviving Corporation may terminate any such plans,
arrangements or benefits at any time without providing substitute or equivalent
benefits.
(b) Purchaser intends to cause the Surviving Corporation to maintain the
Company's 401(k) Plan. The Company shall take such action as may be necessary to
eliminate prior to the Effective Time the option under the Company's 401(k) Plan
to invest in Company Common Stock.
SECTION 6.11 No Solicitation.
The Company shall not, and shall not permit any of its Subsidiaries and
their respective officers, directors, employees, representatives, agents or
affiliates (including, without limitation, any investment banker, attorney or
accountant retained by the Company or any of its Subsidiaries) to, directly or
indirectly, encourage, solicit, initiate or participate in any way in any
discussions or negotiations with, or provide any non-public information to, or
afford any access to the properties, books or records of the Company or any of
its Subsidiaries to, or otherwise assist or facilitate, any corporation,
partnership, person or other entity or group (other than Purchaser or the Sub or
any affiliate or associate of Purchaser or the Sub) concerning any Acquisition
Transaction (as defined in Section 6.12(b)); provided, however, that nothing
contained in this Section 6.11 shall prohibit the Board of Directors of the
Company from furnishing information to or entering into discussions or
negotiations with any person or entity that makes an unsolicited, written, bona
fide proposal to engage in an Acquisition Transaction if, and only to the extent
that, (i) the Board of Directors determines, after consultation with outside
legal counsel, that failure to take any such action would be inconsistent with
its fiduciary duties under the GCL and (ii) prior to taking such action, the
Company receives from such person or entity an executed confidentiality
agreement on terms no less favorable to the Company than those contained in the
letter agreement, dated April 23, 1996, between the Company and The Beacon
Group; and provided, further, that nothing contained in this Section 6.11 shall
prohibit the Company or its Board of Directors from taking and disclosing to the
Company's stockholders a position with respect to a tender offer by a third
party pursuant to Rules 14d-9 and 14e-2(a) promulgated under the Exchange Act.
The Company will immediately notify Purchaser and the Sub if any such
information is requested from it or any such negotiations or discussions are
sought to be initiated with the Company and will immediately communicate to
Purchaser and the Sub the identity of such party and what information is
provided to such party. Subject to the first sentence of this Section 6.11, the
Company will and will cause its Subsidiaries, affiliates and their respective
officers, directors, employees, representatives and agents to immediately cease
and cause to be terminated any existing activities, discussions or negotiations
with any parties other than Purchaser, the Sub or any of their respective
affiliates or associates conducted heretofore with respect to any Acquisition
Transaction. Except as is required in the exercise of the fiduciary duties of
the Board of Directors of the Company in the written opinion of outside counsel
to the Company, the Company agrees not to release any third party from any
confidentiality or standstill agreement to which the Company is a party without
Purchaser's prior written consent and to take all steps deemed necessary or
appropriate by Purchaser to enforce to the fullest extent possible all such
agreements.
SECTION 6.12 Termination Fee; Expenses.
(a) In the event that this Agreement is terminated pursuant to Section
8.1(g), Section 8.1(h), Section 8.1(i) or Section 8.1(j) and within twelve
months from the date of such termination an Acquisition Event (as such term is
defined in Section 6.12(b)), other than with Purchaser, the Sub or any of their
affiliates, has occurred, then the Company shall pay to the Purchaser a fee
equal to $3,300,000 (the "Termination Fee"). Such fee shall be payable in
immediately available funds on the second business day following the occurrence
of the Acquisition Event.
(b) As used herein, "Acquisition Event" shall mean the consummation of any
(i) Acquisition Transaction or (ii) series of transactions that results in any
person, entity or "group" (other than Randolph M. Moity and other than
Purchaser, the Sub or any of their affiliates) acquiring more than 50% of the
outstanding Shares or assets of the Company or Randolph M. Moity acquiring any
additional Shares or assets of the Company (through any open market purchases,
merger, consolidation, recapitalization, reorganization or other business
combination). For purposes of this Agreement, "Acquisition Transaction" shall
mean any
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tender offer or exchange offer, any merger, consolidation, liquidation,
dissolution, recapitalization, reorganization or other business combination, any
acquisition, sale or other disposition of all or a substantial portion of the
assets or securities of the Company or any other similar transaction involving
the Company, its securities or any of its material Subsidiaries or divisions.
(c) In the event that this Agreement is terminated, unless such termination
results solely from a material breach by Purchaser or the Sub of their
respective obligations hereunder, the Company shall promptly at such time assume
and pay (in addition to any amounts payable pursuant to Section 6.12(a) hereof),
or reimburse Purchaser for, the reasonable documented out-of-pocket fees and
expenses actually incurred by or on behalf of Purchaser and the Sub in
connection with the transactions contemplated hereby, including all legal,
investment banking, accounting, printing and other fees and expenses whether
incurred prior to or following the execution of or the termination of this
Agreement ("Reimbursable Expenses").
SECTION 6.13 Financing Availability.
Within fifteen (15) business days after the Offer Documents are first
mailed to stockholders of the Company, Purchaser will have sufficient funds
available to purchase all the outstanding shares (on a fully diluted basis)
pursuant to the Offer and the Merger and to pay all fees and expenses of
Purchaser related to the transactions contemplated by this Agreement and shall
give notice to such effect to the Company.
ARTICLE VII
CONDITIONS TO CONSUMMATION OF THE MERGER
SECTION 7.1 Conditions to Each Party's Obligation to Effect the Merger.
The respective obligations of each party to effect the Merger are subject
to the satisfaction or waiver, where permissible, prior to the Effective Time,
of the following conditions:
(a) this Agreement shall have been adopted by the requisite vote of the
stockholders of the Company in accordance with applicable law, if such vote is
required by applicable law;
(b) no statute, rule, regulation, executive order, decree or injunction
shall have been enacted, entered, promulgated or enforced by any federal or
state court or governmental authority which is in effect and has the effect of
making the acquisition of Shares pursuant to the Merger illegal or otherwise
prohibiting the consummation of the Merger; and
(c) the waiting period, if any, applicable to the consummation of the
Merger under the HSR Act shall have expired or been terminated.
SECTION 7.2 Conditions to Obligations of Purchaser and the Sub to Effect the
Merger.
The obligations of Purchaser and the Sub to effect the Merger are also
subject to each of the following conditions:
(a) The Company and each of its Subsidiaries shall have performed in all
material respects each obligation and covenant to be performed by it hereunder
on or prior to the Effective Time.
(b) The representations and warranties of the Company set forth in this
Agreement shall be true and correct, except where the failure of such
representations or warranties to be so true and correct does not have a Material
Adverse Effect on the Company.
SECTION 7.3 Condition to Obligation of the Company to Effect the Merger.
The obligation of the Company to effect the Merger is also subject to each
of the following conditions:
(a) Each of Purchaser and the Sub shall have performed in all material
respects each obligation to be performed by it hereunder on or prior to the
Effective Time.
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(b) The representations and warranties of Purchaser and the Sub set forth
in this Agreement shall be true and correct in all material respects at and as
of the Effective Time as if made at and as of such time, except as affected by
transactions contemplated or permitted by this Agreement and except to the
extent that any such representation or warranty is made as of a specified date,
in which case such representation or warranty shall have been true and correct
as of such date.
ARTICLE VIII
TERMINATION; AMENDMENT; WAIVER
SECTION 8.1 Termination.
This Agreement may be terminated and the Merger contemplated hereby may be
abandoned at any time notwithstanding approval thereof by the stockholders of
the Company, but prior to the Effective Time:
(a) by mutual written consent duly authorized by the Boards of Directors of
the Company (excluding any designee of Purchaser or an affiliate of Purchaser)
and the Sub and by the General Partner of Purchaser;
(b) by Purchaser or the Company (excluding any designee of Purchaser or an
affiliate of Purchaser) if the Effective Time shall not have occurred on or
before December 31, 1996;
(c) by Purchaser or the Company if any federal or state court of competent
jurisdiction or other federal or state governmental body shall have issued an
order, decree or ruling, or taken any other action restraining, enjoining or
otherwise prohibiting the Offer or the Merger and such order, decree, ruling or
other action shall have become final and nonappealable;
(d) by the Company if the Offer has not been made in accordance with
Section 1.1;
(e) by the Company if no Shares have been purchased under the Offer on or
before December 31, 1996;
(f) by the Company if the Purchaser or the Sub shall be in material breach
of any of the representations and warranties (except such breaches that are
cured prior to the expiration of the Offer) of Purchaser or the Sub set forth in
this Agreement or either Purchaser or the Sub shall have failed in any material
respect to perform any material obligation or covenant (except such failures
that are cured prior to the expiration of the Offer) required by this Agreement
to be performed by it;
(g) by Purchaser if the Company shall be in breach of any of the
representations and warranties (except such breaches that are cured prior to the
expiration of the Offer and such breaches that are not likely to have a Material
Adverse Effect on the Company) of the Company set forth in this Agreement or the
Company shall have failed in any material respect to perform any material
obligation or covenants (except such failures that are cured prior to the
expiration of the Offer and such failures that are not likely to have a Material
Adverse Effect on the Company) required by this Agreement to be performed by it;
(h) by Purchaser, (x) if the Board of Directors or any committee thereof of
the Company withdraws or modifies or amends in a manner adverse to Purchaser or
the Sub its authorization, approval or recommendation of the Offer or the Merger
or this Agreement or shall have resolved to do any of the foregoing or shall
have failed to have reiterated its recommendation within five business days of
any written request by Purchaser or the Sub therefor or (y) if the Company or
any of its Subsidiaries (or the Board of Directors or any committee thereof of
the Company) shall have approved, recommended, authorized, proposed, publicly
announced its intention to enter into or filed a Schedule 14D-9 not opposing any
Acquisition Transaction with a party other than Purchaser, the Sub or any of
their affiliates;
(i) by Purchaser if the Company or any of its Subsidiaries, or any of their
respective officers, directors, employees, representatives, agents or
affiliates, provides or affords access to any non-public information regarding
the Company, other than Non-Proprietary Information (defined below), to any
corporation, partnership, person or other entity or group (other than Purchaser
or the Sub or any affiliate or associate of Purchaser or the Sub) in connection
with any actual or proposed Acquisition Transaction, whether or not permitted by
Section 6.11 hereof; or
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(j) by the Company in the event the Company has received from a third
party, an unsolicited, written, bona fide proposal to engage in an Acquisition
Transaction and, as a result of such proposal, the Board of Directors of the
Company or the Independent Committee modifies, in a manner adverse to Purchaser
or the Sub or withdraws its approval or recommendation of, the Offer or the
Merger referred to in Section 2.1 hereof, so long as the Board of Directors or
such committee, after consultation with and based upon the advice of outside
legal counsel, determines in good faith that failure to take any such action
would be inconsistent with the compliance by the Board of Directors or such
committee with its fiduciary duties to the stockholders of the Company under the
GCL.
As used herein, "Non-Proprietary Information" shall mean (i) all reports filed
by the Company with the SEC pursuant to the Exchange Act, including the exhibits
thereto, (ii) all registration statements and other documents filed by the
Company with the SEC pursuant to the Securities Act, including the exhibits
thereto and any current drafts of any registration statements not yet filed,
(iii) any information regarding the Company's compliance with Environmental
Laws, (iv) information regarding the Company's ownership of its material
properties reflected on its most recent balance sheet included in a report filed
with the SEC pursuant to the Exchange Act, and (v) any other information that
the Company and Purchaser may mutually agree.
SECTION 8.2 Effect of Termination.
In the event of the termination or abandonment of this Agreement pursuant
to Section 8.1 hereof, this Agreement, except for the provisions of Section
6.12, Section 9.3, Section 9.4, Section 9.6 and Section 9.10 hereof, shall
forthwith become void and have no effect, without any liability on the part of
any party or its directors, officers, stockholders, employees, agents,
consultants or representatives. Nothing in this Section 8.2 shall relieve any
party to this Agreement of liability for breach of this Agreement.
SECTION 8.3 Amendment.
To the extent permitted by applicable law, this Agreement may be amended or
supplemented by an instrument in writing signed on behalf of all the parties
hereto; provided, that after this Agreement has been approved by the
stockholders of the Company, no such amendment shall reduce the amount or change
the form of consideration to be paid to the Subsidiaries of the Company in the
Merger or alter or change any of the terms or conditions of this Agreement if
such alteration or change would adversely affect the rights of the Company's
stockholders under this Agreement without the prior approval of such
stockholders.
SECTION 8.4 Extension; Waiver.
At any time prior to the Effective Time, the parties hereto, by action
taken by or on behalf of the respective Boards of Directors of the Company, the
Sub or Purchaser, may (i) extend the time for the performance of any of the
obligations or other acts of the other parties hereto, (ii) waive any
inaccuracies in the representations and warranties contained herein by any other
applicable party or in any document, certificate or writing delivered pursuant
hereto by any other applicable party or (iii) waive compliance with any of the
agreements or conditions contained herein. Any agreement on the part of any
party to any such extension or waiver shall be valid only if set forth in an
instrument in writing signed on behalf of such party.
ARTICLE IX
MISCELLANEOUS
SECTION 9.1 No Survival of Representations and Warranties.
The representations and warranties made in Articles IV and V shall not
survive beyond the Merger. This Section 9.1 shall not limit any covenant or
agreement of the parties hereto which by its terms contemplates performance
after the Effective Time.
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SECTION 9.2 Entire Agreement; Assignment.
This Agreement (a) constitutes the entire agreement among the parties with
respect to the subject matter hereof and supersedes all other prior agreements
and understanding, both 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, provided that Purchaser or the Sub may assign any of their
rights and obligations to any affiliate (as defined in Rule 12b-2 under the
Exchange Act) of Purchaser if such affiliate expressly assumes in writing the
obligations of Purchaser or Sub, as the case may be, under this Agreement, but
no such assignment shall relieve Purchaser or the Sub of its obligations
hereunder. Only the Sub (or Purchaser, or a directly or indirectly wholly owned
subsidiary of Purchaser to which the Sub assigns rights and obligations) may
commence the Offer or purchase Shares thereunder.
SECTION 9.3 Enforcement of the Agreement.
The parties hereto agree that irreparable damage would occur in the event
that any of the provisions of this Agreement were not performed in accordance
with their specific terms or were otherwise breached. It is accordingly agreed
that the parties shall be entitled to an injunction or injunctions to prevent
breaches of this Agreement and to enforce specifically the terms and provisions
hereof in any federal or state court located in the State of Delaware (as to
which the parties agree to submit to jurisdiction for the purposes of such
action), this being in addition to any other remedy to which they are entitled
at law or in equity.
SECTION 9.4 Validity.
The invalidity or unenforceability of any provision of this Agreement shall
not affect the validity or enforceability of any other provisions of this
Agreement, which shall remain in full force and effect.
SECTION 9.5 Notices.
All notices, requests, claims, demands and other communications hereunder
shall be in writing and shall be deemed to have been duly given when delivered
in person, by cable, telegram or telex, or by registered or certified mail
(postage prepaid, return receipt requested) to the respective parties as
follows:
if to Purchaser or the Sub:
The Beacon Group
375 Park Avenue
New York, New York 10152
Attention: Mr. Robert F. Semmens
with a copy to:
Andrews & Kurth L.L.P.
425 Lexington Avenue
New York, New York 10017
Attention: Mark Zvonkovic, Esq.
if to the Company:
The AMBAR Building
221 Rue de Jean, Suite 300
Lafayette, Louisiana 70508
Attention: General Counsel
23
<PAGE> 24
with a copy to:
Jones, Walker, Waechter, Poitevent, Carrere & Denegre L.L.P.
210 St. Charles Avenue
Suite 5100
New Orleans, Louisiana 70170-5100
Attention: Curtis R. Hearn, Esq.
or to such other address as the person to whom notice is given may have
previously furnished to the others in writing in the manner set forth above
(provided that notice of any change of address shall be effective only upon
receipt thereof).
SECTION 9.6 Governing Law.
This Agreement shall be governed by and construed in accordance with the
laws of the State of Delaware regardless of the laws that might otherwise govern
under principles of conflicts of laws applicable thereto.
SECTION 9.7 Descriptive Headings.
The descriptive headings herein are inserted for convenience of reference
only and are not intended to be part of or to affect the meaning of
interpretation of this Agreement.
SECTION 9.8 Parties in Interest.
This Agreement shall be binding upon and inure solely to the benefit of
each party hereto, and nothing in this Agreement, express or implied, is
intended to confer upon any other person any rights or remedies of any nature
whatsoever under or by reason of this Agreement except for Section 6.6 (which is
intended to be for the benefit of the persons referred to therein, and may be
enforced by such persons).
SECTION 9.9 Counterparts.
This Agreement may be executed in counterparts, each of which shall be
deemed to be an original, but all of which shall constitute one and the same
agreement.
SECTION 9.10 Expenses.
Except as provided in Section 6.12(c), all costs and expenses incurred in
connection with the transaction contemplated by this Agreement shall be paid by
the party incurring such expenses.
SECTION 9.11 Certain Definitions.
(a) "Subsidiary" shall mean, when used with reference to an entity, any
corporation, a majority of the outstanding voting securities of which are owned
directly or indirectly by such entity. For purposes of this Agreement, the
Company shall not be deemed to be an affiliate or subsidiary of the Sub or
Purchaser.
(b) "Material Adverse Effect" shall mean a material adverse effect on (i)
the business, operations, condition (financial or otherwise), results of
operations or prospects of the Company and its Subsidiaries, taken as a whole,
(ii) the value, condition or marketability of any material assets of the Company
and its Subsidiaries, taken as a whole or (iii) the ability of the Company and
its Subsidiaries to perform on a timely basis its obligations under any material
contract or to exercise or enforce any of its material rights, powers or
remedies under any material contract; provided, however, that the parties agree
that a Material Adverse Effect shall not be deemed to have occurred on account
of any single event or condition that results in, or is reasonably likely to
result in, or any group of events or conditions that in the aggregate result in,
or are reasonably likely to result in, a loss, cost, penalty or diminution in
value in the business, operations, condition (financial or otherwise), results
of operations or prospects of the Company and its Subsidiaries that is less than
$750,000; and provided, further, that no prospective change in the business,
operations, condition (financial or otherwise), results of operations or
prospects of the Company and its Subsidiaries on account of general
24
<PAGE> 25
economic conditions or local, regional, national or international industry
conditions shall be deemed to constitute a Material Adverse Effect.
(c) "Knowledge of the Company" shall mean, when used in any representation,
covenant or warranty of the Company contained herein, the actual knowledge of
any officer, director, key employee, division head or similar person of the
Company or any of its Subsidiaries.
SECTION 9.12 Performance by the Sub.
Purchaser hereby agrees to cause the Sub to comply with each of its
obligations hereunder and under the Offer, including without limitation, to
cause the Sub to consummate the Merger as contemplated herein.
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed on its behalf by its officers thereunto duly authorized, all at or on
the day and year first above written.
<TABLE>
<S> <C>
AMBAR, INC.
Attest: /s/ STACEY GOFF By: /s/ RANDOLPH M. MOITY, SR.
-------------------------------------- -----------------------------------------
Name: Stacey Goff Name: Randolph M. Moity, Sr.
Title: Associate Title: President and Chief Executive
Officer
AI PARTNERS L.P.
By: AI-GP, L.L.C., general partner
Attest: /s/ STACEY GOFF
-------------------------------------- By: Energy Fund G.P. Inc., member
Name: Stacey Goff
Title: Associate By: /s/ ROBERT F. SEMMENS
-----------------------------------------
Name: Robert F. Semmens
Title: Managing Director
AI ACQUISITIONS CORP.
Attest: /s/ STACEY GOFF By: /s/ ROBERT F. SEMMENS
-------------------------------------- -----------------------------------------
Name: Stacey Goff Name: Robert F. Semmens
Title: Associate Title: Managing Director
</TABLE>
25
<PAGE> 26
EXHIBIT A
Notwithstanding any other provisions of the Offer, the Sub shall not be
required to accept for payment, purchase or pay for any Shares tendered, and
may, subject to the terms of the Merger Agreement, amend the Offer and may
postpone the acceptance for payment of and payment for Shares, if (i) as of the
expiration of the Offer, there shall not have been validly tendered and not
withdrawn pursuant to the Offer a number of Shares such that, upon consummation
of the Offer, Purchaser and its affiliates will beneficially own in the
aggregate not less than 90% of the Shares outstanding on a fully diluted basis,
(ii) the applicable waiting period under the HSR Act shall not have expired or
been terminated, or (iii) at any time on or after December 31, 1996 and before
the time of payment for any such Shares (whether or not any Shares have
theretofore been accepted for payment or paid for pursuant to the Offer) any of
the following conditions exist or shall occur and remain in effect:
(a) there shall have occurred and be in effect (i) any general suspension
of trading in, or limitation on prices for, securities on the New York Stock
Exchange or in the NASDAQ Stock Market which has remained in effect for five
consecutive business days, (ii) a declaration of a banking moratorium or any
suspension of payments in respect of banks in the United States, (iii) any
material limitation (whether or not mandatory) by any governmental authority on
the extension of credit by lending institutions, or (iv) in the case of any of
the foregoing existing at the time of the commencement of the Offer a material
acceleration or worsening thereof; or
(b) an order shall have been entered in any action or proceeding before any
United States federal or state court or governmental agency or other United
States regulatory or administrative agency or commission, or a preliminary or
permanent injunction by a United States court of competent jurisdiction
(collectively, a "Governmental Action") shall have been issued and remain in
effect, which would have the effect of (i) making the purchase of, or payment
for, some or all of the Shares pursuant to the Offer or the Merger Agreement
illegal, (ii) otherwise preventing consummation of the Merger, (iii) requiring
the divestiture by Purchaser or any of its Subsidiaries or affiliates of any
Shares, or the divestiture by Purchaser of all or a material portion of its
business, assets or property, or (iv) otherwise having a Material Adverse Effect
(as defined in the Merger Agreement) on Purchaser or the Company; provided,
however, that for purposes of this clause (b)(iv), to the extent that any order
or preliminary or permanent injunction relates to the stock purchases as
contemplated by the Stockholder Agreements (as defined in the Merger Agreement),
such order or injunction shall not be deemed to have a Material Adverse Effect
on either Purchaser or the Company; or
(c) the Merger Agreement shall have been terminated in accordance with its
terms; or
(d) the Company shall have breached in any material respect any of the
representations and warranties of the Company set forth in the Merger Agreement
(other than any matters that, in the aggregate, do not have a Material Adverse
Effect on the Company) or the Company shall have failed in any material respect
to perform any material obligation or covenant required by the Merger Agreement
to be performed or complied with by it; or
(e) there shall have occurred any event resulting in a Material Adverse
Effect on the Company; or
(f) Any Person (other than Purchaser, the Sub or any of their respective
affiliates or Subsidiaries) acquires beneficial ownership (as defined in Rule
13d-3 promulgated under the Exchange Act) of at least 20% of the outstanding
voting securities of the Company or is granted any option or right to acquire at
least 20% of such voting securities (as used herein, "Person" shall include any
corporation, person, partnership, trust, other entity or group as defined in the
Exchange Act); or
(g) Purchaser, the Sub and the Company shall have agreed that the Sub shall
terminate the Offer or postpone the payment for Shares thereunder; or
(h) the Company shall have withdrawn, modified or amended in any respect
its recommendation of the Offer, or the Board of Directors of the Company or any
committee thereof shall have resolved to do so;
which, in the sole judgment of Purchaser, makes it inadvisable to proceed with
the Offer or with such acceptance for payment or payment.
26
<PAGE> 27
The foregoing conditions are for the sole benefit of Purchaser and the Sub
and may be asserted by Purchaser and the Sub regardless of the circumstances
giving rise to any such condition. The foregoing conditions may be waived by
Purchaser in whole or in part at any time and from time to time in its sole
discretion. The failure by Purchaser or the Sub at any time to exercise any of
the foregoing rights will not be deemed a waiver of any right and each right
will be deemed an ongoing right which may be asserted at any time and from time
to time.
To the extent not otherwise defined herein, all capitalized terms shall
have the meaning ascribed to them in the Merger Agreement.
27
<PAGE> 28
EXHIBIT B
FORM OF
AMENDED AND RESTATED
CERTIFICATE OF INCORPORATION
OF
AMBAR, INC.
Pursuant to Section 102 of the General Corporation Law
of the State of Delaware
The undersigned, in order to form a corporation pursuant to Section 102
of the General Corporation Law of the State of Delaware, does hereby certify:
FIRST: The name of the Corporation is AMBAR, Inc.
SECOND: The address of the Corporation's registered office in the
State of Delaware is c/o United Corporate Services, Inc., 15 East North Street,
in the City of Dover, County of Kent, Delaware 19901. The name of its
registered agent at such address is United Corporate Services, Inc.
THIRD: The purpose of the Corporation is to engage in any lawful act
or activity for which corporations may be organized under the General
Corporation Law of the State of Delaware.
FOURTH: The total number of shares which the Corporation shall have
authority to issue is 1,000 shares of Common Stock, par value $.01 per share.
FIFTH: The name and mailing address of the Incorporator is as follows:
Name Mailing Address
---- ---------------
Kathleen S. Minniti Andrews & Kurth L.L.P.
425 Lexington Avenue
New York, NY 10017
SIXTH: The Board of Directors is expressly authorized to adopt, amend,
or repeal the by-laws of the Corporation.
SEVENTH: Elections of directors need not be by written ballot unless
the by-laws of the Corporation shall otherwise provide.
EIGHTH: A director of the Corporation shall not be personally liable
to the Corporation or its stockholders for monetary damages for breach of
fiduciary duty as a director; provided, however,
<PAGE> 29
that the foregoing shall not claim or limit the liability of a director (i) for
any breach of the director's duty of loyalty to the Corporation or its
stockholders, (ii) for acts or omissions not in good faith or which involve
intentional misconduct or a knowing violation of law, (iii) under Section 174
of the General Corporation Law of Delaware, or (iv) for any transaction from
which the director derived an improper personal benefit. If the General
Corporation Law of Delaware is hereafter amended to permit further elimination
or limitation of the personal liability of directors, then the liability of a
director of the Corporation shall be eliminated or limited to the fullest
extent permitted by the General Corporation Law of Delaware as so amended. Any
repeal or modification of this Article EIGHTH by the stockholders of the
Corporation or otherwise shall not adversely affect any right or protection of
a director of the Corporation existing at the time of such repeal or
modification.
NINTH: The Corporation reserves the right to amend, alter, change, or
repeal any provision contained in this Certificate of Incorporation, in the
manner now or hereafter prescribed by statute, and all rights conferred upon
stockholders herein are granted subject to this reservation.
IN WITNESS WHEREOF, I have hereunto set my hand this ___th day of
________, 1996 and I affirm that the foregoing certificate is my act and deed
and that the facts stated therein are true.
-------------------------------------
Kathleen S. Minniti, Incorporator
<PAGE> 30
B Y L A W S
OF
AMBAR, INC.
<PAGE> 31
DATED: JULY 1, 1996
INDEX
<TABLE>
<S> <C> <C>
ARTICLE I
OFFICES
SECTION 1.1 Principal Office.......................................................... 4
SECTION 1.2 Registered Office......................................................... 4
SECTION 1.3 Other Offices............................................................. 4
ARTICLE II
STOCKHOLDERS' MEETINGS
SECTION 2.1 Annual Meeting............................................................ 4
SECTION 2.2 Special Meetings.......................................................... 4
SECTION 2.3 Notice of Meetings and Adjourned Meetings................................. 4
SECTION 2.4 Voting Lists.............................................................. 5
SECTION 2.5 Quorum.................................................................... 5
SECTION 2.6 Organization.............................................................. 5
SECTION 2.7 Voting.................................................................... 5
SECTION 2.8 Stockholders Entitled to Vote............................................. 6
SECTION 2.9 Order of Business......................................................... 6
SECTION 2.10 Action by Written Consent................................................. 6
SECTION 2.11 Authorization of Proxies.................................................. 6
SECTION 2.12 Inspectors and Voting Procedures.......................................... 6
ARTICLE III
DIRECTORS
SECTION 3.1 Management................................................................ 7
SECTION 3.2 Number and Term........................................................... 7
SECTION 3.3 Quorum and Manner of Action............................................... 7
SECTION 3.4 Vacancies................................................................. 8
SECTION 3.5 Resignations.............................................................. 8
SECTION 3.6 Removals.................................................................. 8
SECTION 3.7 Annual Meetings........................................................... 8
SECTION 3.8 Regular Meetings.......................................................... 8
SECTION 3.9 Special Meetings.......................................................... 8
SECTION 3.10 Organization of Meetings.................................................. 8
SECTION 3.11 Place of Meetings......................................................... 9
SECTION 3.12 Compensation of Directors................................................. 9
SECTION 3.13 Action by Unanimous Written Consent....................................... 9
SECTION 3.14 Participation in Meetings by Telephone.................................... 9
ARTICLE IV
COMMITTEES OF THE BOARD
SECTION 4.1 Membership and Authorities................................................ 9
SECTION 4.2 Minutes................................................................... 9
SECTION 4.3 Vacancies................................................................. 10
SECTION 4.4 Telephone Meetings........................................................ 10
SECTION 4.5 Action Without Meeting.................................................... 10
</TABLE>
2
<PAGE> 32
<TABLE>
<S> <C> <C>
ARTICLE V
OFFICERS
SECTION 5.1 Number and Title.......................................................... 10
SECTION 5.2 Term of Office; Vacancies................................................. 10
SECTION 5.3 Removal of Elected Officers............................................... 10
SECTION 5.4 Resignations.............................................................. 10
SECTION 5.5 The Chairman of the Board................................................. 11
SECTION 5.6 President................................................................. 11
SECTION 5.7 Vice Presidents........................................................... 11
SECTION 5.8 Secretary................................................................. 11
SECTION 5.9 Assistant Secretaries..................................................... 11
SECTION 5.10 Treasurer................................................................. 11
SECTION 5.12 Assistant Treasurers...................................................... 12
SECTION 5.12 Subordinate Officers...................................................... 12
SECTION 5.13 Salaries and Compensation................................................. 12
ARTICLE VI
INDEMNIFICATION OF DIRECTORS AND OFFICERS
ARTICLE VII
CAPITAL STOCK
SECTION 7.1 Certificates of Stock..................................................... 14
SECTION 7.2 Lost Certificates......................................................... 15
Fixing Date for Determination of Stockholders of Record for Certain
SECTION 7.3 Purposes.................................................................. 15
SECTION 7.4 Dividends................................................................. 15
SECTION 7.5 Registered Stockholders................................................... 15
SECTION 7.6 Transfer of Stock......................................................... 15
ARTICLE VIII
MISCELLANEOUS PROVISIONS
SECTION 8.1 Corporate Seal............................................................ 16
SECTION 8.2 Fiscal Year............................................................... 16
SECTION 8.3 Checks, Drafts, Notes..................................................... 16
SECTION 8.4 Notice and Waiver of Notice............................................... 16
SECTION 8.5 Examination of Books and Records.......................................... 16
SECTION 8.6 Voting Upon Shares Held by the Corporation................................ 17
ARTICLE IX
AMENDMENTS
SECTION 9.1 Amendment................................................................. 17
</TABLE>
3
<PAGE> 33
AMBAR, INC.
BYLAWS
ARTICLE I
OFFICES
SECTION 1.1 Principal Office.
The principal office of the Corporation shall be in the City of Lafayette,
Louisiana.
SECTION 1.2 Registered Office.
The registered office of the Corporation required to be maintained in the
State of Delaware by the General Corporation Laws of the State of Delaware, may
be, but need not be, identical with the Corporation's principal office, and the
address of the registered office may be changed from time to time by the Board
of Directors.
SECTION 1.3 Other Offices.
The Corporation may also have offices at such other places both within and
without the State of Delaware as the Board of Directors may from time to time
determine or the business of the Corporation may require.
ARTICLE II
STOCKHOLDERS' MEETINGS
SECTION 2.1 Annual Meeting.
The annual meeting of the holders of shares of each class or series of
stock as are entitled to notice thereof and to vote thereat pursuant to
applicable law and the Corporation's Certificate of Incorporation for the
purpose of electing directors and transacting such other proper business as may
come before it shall be held in each year, at such time, on such day and at such
place, within or without the State of Delaware, as may be designated by the
Board of Directors.
SECTION 2.2 Special Meetings.
In addition to such special meetings as are provided by law or the
Corporation's Certificate of Incorporation, special meetings of the holders of
any class or series or of all classes or series of the Corporation's stock for
any purpose or purposes, may be called at any time by the Board of Directors and
may be held on such day, at such time and at such place, within or without the
State of Delaware, as shall be designated by the Board of Directors.
SECTION 2.3 Notice of Meetings and Adjourned Meetings.
Except as otherwise provided by law, written notice of any meeting of
Stockholders (i) shall be given either by personal delivery or by mail to each
Stockholder of record entitled to vote thereat, (ii) shall be in such form as is
approved by the Board of Directors, and (iii) shall state the date, place and
hour of the meeting, and, in the case of a special meeting, the purpose or
purposes for which the meeting is called. Unless otherwise provided by law, such
written notice shall be given not less than ten (10) nor more than sixty (60)
days before the date of the meeting. Except when a Stockholder attends a meeting
for the express purpose of objecting, at the beginning of the meeting, to the
transaction of any business on the ground that the meeting is not lawfully
called or convened, presence in person or by proxy of a Stockholder shall
constitute a waiver of notice of such meeting. Further, a written waiver of any
notice required by law or by these Bylaws, signed by the person entitled to
notice, whether before or after the time stated therein, shall be deemed
equivalent to notice. Except as otherwise provided by law, the business that may
be transacted at any such meeting shall be
4
<PAGE> 34
limited to and consist of the purpose or purposes stated in such notice. If a
meeting is adjourned to another time or place, notice need not be given of the
adjourned meeting if the time and place thereof are announced at the meeting at
which the adjournment is taken; provided, however, that if the adjournment is
for more than thirty (30) days, or if after the adjournment a new record date is
fixed for the adjourned meeting, a notice of the adjourned meeting shall be
given to each Stockholder of record entitled to vote at the meeting.
SECTION 2.4 Voting Lists.
The officer or agent having charge of the stock transfer books for shares
of the Corporation shall keep a complete list of Stockholders entitled to vote
at meetings or any adjournments thereof, arranged in alphabetical order, in
accordance with applicable law and shall make same available prior to and during
each Stockholders' meeting for inspection by the Corporation's Stockholders as
required by law. The Corporation's original stock transfer books shall be prima
facie evidence as to who are the Stockholders entitled to examine such list or
transfer books or to vote at any meeting of Stockholders.
SECTION 2.5 Quorum.
Except as otherwise provided by law or by the Corporation's Certificate of
Incorporation, the holders of a majority of the Corporation's stock issued and
outstanding and entitled to vote at a meeting, present in person or represented
by proxy, without regard to class or series, shall constitute a quorum at all
meetings of the Stockholders for the transaction of business. If, however, such
quorum shall not be present or represented at any meeting of the Stockholders,
the holders of a majority of such shares of stock, present in person or
represented by proxy, may adjourn any meeting from time to time without notice
other than announcement at the meeting, except as otherwise required by these
Bylaws, until a quorum shall be present or represented. At any such adjourned
meeting at which a quorum shall be present or represented, any business may be
transacted which might have been transacted at the meeting as originally called.
SECTION 2.6 Organization.
Meetings of the Stockholders shall be presided over by the Chairman of the
Board of Directors, if one shall be elected, or in his absence, by the President
or by any Vice President, or, in the absence of any of such officers, by a
chairman to be chosen by a majority of the Stockholders entitled to vote at the
meeting who are present in person or by proxy. The Secretary, or, in his
absence, any Assistant Secretary or any person appointed by the individual
presiding over the meeting, shall act as secretary at meetings of the
Stockholders.
SECTION 2.7 Voting.
Each Stockholder of record, as determined pursuant to Section 2.8, who is
entitled to vote in accordance with the terms of the Corporation's Certificate
of Incorporation and in accordance with the provisions of these Bylaws, shall be
entitled to one vote, in person or by proxy, for each share of stock registered
in his name on the books of the Corporation. Every Stockholder entitled to vote
at any Stockholders' meeting may authorize another person or persons to act for
him by proxy pursuant to Section 2.12(c), provided that no such proxy shall be
voted or acted upon after three years from its date, unless the proxy provides
for a longer period. A duly executed proxy shall be irrevocable if it states
that it is irrevocable and if, and only so long as, it is coupled with an
interest sufficient in law to support an irrevocable power. A Stockholder's
attendance at any meeting shall not have the effect of revoking a previously
granted proxy unless such Stockholder shall in writing so notify the Secretary
of the meeting prior to the voting of the proxy. Unless otherwise provided by
law, no vote on the election of directors or any question brought before the
meeting need be by ballot unless the chairman of the meeting shall determine
that it shall be by ballot or the holders of a majority of the shares of stock
present in person or by proxy and entitled to participate in such vote shall so
demand. In a vote by ballot, each ballot shall state the number of shares voted
and the name of the Stockholder or proxy voting. Except as otherwise provided by
law, by the Corporation's Certificate of Incorporation or these Bylaws, all
elections of directors and all other matters before the Stockholders shall be
decided by the vote of the holders of a majority of the shares of stock present
in person or by proxy at the meeting and entitled to vote in the election or on
the question. In the election of directors, votes may not be cumulated.
5
<PAGE> 35
SECTION 2.8 Stockholders Entitled to Vote.
The Board of Directors may fix a date not more than sixty (60) days nor
less than ten (10) days prior to the date of any meeting of Stockholders, or, in
the case of corporate action by written consent in accordance with the terms of
Section 2.10(b), not prior to the date upon which the resolution of the Board of
Directors fixing the record date is adopted and not more than ten (10) days
after the date upon which the resolution of the Board of Directors fixing the
record date is adopted, as a record date for the determination of the
Stockholders entitled to notice of and to vote at such meeting and any
adjournment thereof, or to act by written consent, and in each case such
Stockholders and only such Stockholders as shall be Stockholders of record on
the date so fixed shall be entitled to notice of and to vote at such meeting and
any adjournment thereof, or to act by written consent, as the case may be,
notwithstanding any transfer of any stock on the books of the Corporation after
such record date fixed as aforesaid.
SECTION 2.9 Order of Business.
The order of business at all meetings of Stockholders shall be as
determined by the chairman of the meeting or as is otherwise determined by the
vote of the holders of a majority of the shares of stock present in person or by
proxy and entitled to vote without regard to class or series at the meeting.
SECTION 2.10 Action by Written Consent.
Unless otherwise provided by law or the Corporation's Certificate of
Incorporation, any action required or permitted to be taken by the Stockholders
of the Corporation may be taken without prior notice and an actual meeting if a
consent in writing setting forth the action so taken shall be signed by the
holders of outstanding stock having not less than the minimum number of votes
that would be necessary to authorize or take such action at a meeting at which
all shares entitled to vote thereon were present and voted. Except as provided
above, no action shall be taken by the Stockholders by written consent. Prompt
notice of the taking of any corporate action without a meeting by less than
unanimous written consent shall be given to those Stockholders who have not
consented in writing.
SECTION 2.11 Authorization of Proxies.
Without limiting the manner in which a Stockholder may authorize another
person or persons to act for him as proxy, the following are valid means of
granting such authority. A Stockholder may execute a writing authorizing another
person or persons to act for him as proxy. Execution may be accomplished by the
Stockholder or his authorized officer, director, employee or agent signing such
writing or causing his or her signature to be affixed to such writing by any
reasonable means including, but not limited to, by facsimile signature. A
Stockholder may also authorize another person or persons to act for him as proxy
by transmitting or authorizing the transmission of a telegram, cablegram, or
other means of electronic transmission to the person who will be the holder of
the proxy or to a proxy solicitation firm, proxy support service organization or
like agent duly authorized by the person who will be the holder of the proxy to
receive such transmission, provided that any such telegram, cablegram or other
means of electronic transmission must either set forth or be submitted with
information from which it can be determined that the telegram, cablegram or
other electronic transmission was authorized by the Stockholder. If it is
determined that such telegrams, cablegrams or other electronic transmissions are
valid, the inspectors or, if there are no inspectors, such other persons making
that determination shall specify the information upon which they relied. Any
copy, facsimile telecommunication or other reliable reproduction of the writing
or transmission created pursuant to this section may be substituted or used in
lieu of the original writing or transmission for any and all purposes for which
the writing or transmission could be used, provided that such copy, facsimile
telecommunication or other reproduction shall be a complete reproduction of the
entire original writing or transmission.
SECTION 2.12 Inspectors and Voting Procedures.
(a) The Corporation shall, in advance of any meeting of Stockholders,
appoint one or more inspectors to act at the meeting and make a written report
thereof. The Corporation may designate one or more persons as
6
<PAGE> 36
alternate inspectors to replace any inspector who fails to act. If no inspector
or alternate is able to act at a meeting of Stockholders, the person presiding
at the meeting shall appoint one or more inspectors to act at the meeting. Each
inspector, before entering upon the discharge of his duties, shall take and sign
an oath faithfully to execute the duties of inspector with strict impartiality
and according to the best of his ability.
(b) The inspectors shall (i) ascertain the number of shares outstanding and
the voting power of each, (ii) determine the shares represented at a meeting and
the validity of proxies and ballots, (iii) count all votes and ballots, (iv)
determine and retain for a reasonable period a record of the disposition of any
challenges made to any determination by the inspectors, and (v) certify their
determination of the number of shares represented at the meeting, and their
count of all votes and ballots. The inspectors may appoint or retain other
persons or entities to assist the inspectors in the performance of the duties of
the inspectors.
(c) The date and time of the opening and closing of the polls for each
matter upon which the Stockholders will vote at a meeting shall be announced at
the meeting. No ballot, proxies or votes, nor any revocations thereof or changes
thereto, shall be accepted by the inspectors after the closing of the polls
unless the Court of Chancery upon application by a Stockholder shall determine
otherwise.
(d) In determining the validity and counting of proxies and ballots, the
inspectors may examine and consider such records or factors as allowed by the
General Corporation Laws of the State of Delaware.
ARTICLE III
DIRECTORS
SECTION 3.1 Management.
The property, affairs and business of the Corporation shall be managed by
or under the direction of the Board of Directors which may exercise all powers
of the Corporation and do all lawful acts and things as are not by law, by the
Corporation's Certificate of Incorporation or by these Bylaws directed or
required to be exercised or done by the Stockholders.
SECTION 3.2 Number and Term.
The number of directors may be fixed from time to time by resolution of the
Board of Directors adopted by the affirmative vote of a majority of the members
of the entire Board of Directors, but shall consist of not less than one (1)
member who shall be elected annually by the Stockholders except as provided in
Section 3.4. Directors need not be Stockholders. No decrease in the number of
directors shall have the effect of shortening the term of office of any
incumbent director. [*]
SECTION 3.3 Quorum and Manner of Action.
At all meetings of the Board of Directors a majority of the total number of
directors holding office shall constitute a quorum for the transaction of
business and the act of a majority of the directors present at any meeting at
which there is a quorum shall be the act of the Board of Directors, except as
may be otherwise specifically provided by law, by the Corporation's Certificate
of Incorporation or these Bylaws. When the Board of Directors consists of one
director, the one director shall constitute a majority and a quorum. If at any
meeting of the Board of Directors there shall be less than a quorum present, a
majority of those present may adjourn the meeting from time to time until a
quorum is obtained, and no further notice thereof need be given other than by
announcement at such adjourned meeting. Attendance by a director at a meeting
shall constitute a waiver of notice of such meeting except where a director
attends a meeting for the express purpose of objecting, at the beginning of the
meeting, to the transaction of any business on the ground that the meeting is
not lawfully called or convened.
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SECTION 3.4 Vacancies.
Except as otherwise provided by law or the Corporation's Certificate of
Incorporation, in the case of any increase in the authorized number of directors
or of any vacancy in the Board of Directors, however created, the additional
director or directors may be elected, or, as the case may be, the vacancy or
vacancies may be filled by majority vote of the directors remaining on the whole
Board of Directors although less than a quorum, or by a sole remaining director.
In the event one or more directors shall resign, effective at a future date,
such vacancy or vacancies shall be filled by a majority of the directors who
will remain on the whole Board of Directors, although less than a quorum, or by
a sole remaining director. Any director elected or chosen as provided herein
shall serve until the sooner of: (i) the unexpired term of the directorship to
which he is appointed; (ii) until his successor is elected and qualified; or
(iii) until his earlier resignation or removal.
SECTION 3.5 Resignations.
A director may resign at any time upon written notice of resignation to the
Corporation. Any resignation shall be effective immediately unless a certain
effective date is specified therein, in which event it will be effective upon
such date and acceptance of any resignation shall not be necessary to make it
effective.
SECTION 3.6 Removals.
Any director or the entire Board of Directors may be removed, with or
without cause, and another person or persons may be elected to serve for the
remainder of his or their term by the holders of a majority of the shares of the
Corporation entitled to vote in the election of directors. In case any vacancy
so created shall not be filled by the Stockholders at such meeting, such vacancy
may be filled by the directors as provided in Section 3.4.
SECTION 3.7 Annual Meetings.
The annual meeting of the Board of Directors shall be held, if a quorum be
present, immediately following each annual meeting of the Stockholders at the
place such meeting of Stockholders took place, for the purpose of organization
and transaction of any other business that might be transacted at a regular
meeting thereof, and no notice of such meeting shall be necessary. If a quorum
is not present, such annual meeting may be held at any other time or place that
may be specified in a notice given in the manner provided in Section 3.9 for
special meetings of the Board of Directors or in a waiver of notice thereof.
SECTION 3.8 Regular Meetings.
Regular meetings of the Board of Directors may be held without notice at
such places and times as shall be determined from time to time by resolution of
the Board of Directors. Except as otherwise provided by law, any business may be
transacted at any regular meeting of the Board of Directors.
SECTION 3.9 Special Meetings.
Special meetings of the Board of Directors may be called by the President,
or by the Secretary on the written request of one-third ( 1/3) of the members of
the whole Board of Directors stating the purpose or purposes of such meeting.
Notices of special meetings, if mailed, shall be mailed to each director not
later than two (2) days before the day the meeting is to be held or if otherwise
given in the manner permitted by these Bylaws, not later than the day before
such meeting. Neither the business to be transacted at, nor the purpose of, any
special meeting need be specified in any notice or written waiver of notice
unless so required by the Corporation's Certificate of Incorporation or by these
Bylaws. Any and all business may be transacted at a special meeting, unless
limited by law, the Corporation's Certificate of Incorporation or by these
Bylaws.
SECTION 3.10 Organization of Meetings.
At any meeting of the Board of Directors, business shall be transacted in
such order and manner as such Board of Directors may from time to time
determine, and all matters shall be determined by the vote of a
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majority of the directors present at any meeting at which there is a quorum,
except as otherwise provided by these Bylaws or required by law.
SECTION 3.11 Place of Meetings.
The Board of Directors may hold their meetings and have one or more
offices, and keep the books of the Corporation, outside the State of Delaware,
at any office or offices of the Corporation, or at any other place as they may
from time to time by resolution determine.
SECTION 3.12 Compensation of Directors.
Directors shall not receive any stated salary for their services as
directors, but by resolution of the Board of Directors a fixed honorarium or
fees and expenses, if any, of attendance may be allowed for attendance at each
meeting. Nothing herein contained shall be construed to preclude any director
from serving the Corporation in any other capacity and receiving compensation
therefor. Members of special or standing committees may be allowed like
compensation for attending such committee meetings.
SECTION 3.13 Action by Unanimous Written Consent.
Unless otherwise restricted by law, the Corporation's Certificate of
Incorporation or these Bylaws, any action required or permitted to be taken at
any meeting of the Board of Directors or of any committee thereof may be taken
without a meeting if all members of the Board of Directors or of such committee,
as the case may be, consent thereto in writing and the writing or writings are
filed with the minutes of proceedings of the Board of Directors or the
committee.
SECTION 3.14 Participation in Meetings by Telephone.
Unless otherwise restricted by the Corporation's Certificate of
Incorporation or these Bylaws, members of the Board of Directors or of any
committee thereof may participate in a meeting of such Board of Directors or
committee by means of conference telephone or similar communications equipment
by means of which all persons participating in the meeting can hear each other.
Participation in a meeting in such manner shall constitute presence in person at
such meeting, except where a person participates in the meeting for the express
purpose of objecting, at the beginning of the meeting, to the transaction of any
business on the grounds that the meeting is not lawfully called or convened.
ARTICLE IV
COMMITTEES OF THE BOARD
SECTION 4.1 Membership and Authorities.
The Board of Directors may, by resolution or resolutions passed by a
majority of the whole Board of Directors, designate one (1) or more Directors to
constitute an Executive Committee and such other committees as the Board of
Directors may determine, each of which committees to the extent provided in said
resolution or resolutions or in these Bylaws, shall have and may exercise all
the powers of the Board of Directors in the management of the business and
affairs of the Corporation, except in those cases where the authority of the
Board of Directors is specifically denied to the Executive Committee or such
other committee or committees by law, the Corporation's Certificate of
Incorporation or these Bylaws, and may authorize the seal of the Corporation to
be affixed to all papers that may require it. The designation of an Executive
Committee or other committee and the delegation thereto of authority shall not
operate to relieve the Board of Directors, or any member thereof, of any
responsibility imposed upon it or him by law.
SECTION 4.2 Minutes.
Each committee designated by the Board of Directors shall keep regular
minutes of its proceedings and report the same to the Board of Directors when
required.
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SECTION 4.3 Vacancies.
The Board of Directors may designate one (1) or more of its members as
alternate members of any committee who may replace any absent or disqualified
member at any meeting of such committee. If no alternate members have been
appointed, the committee member or members thereof present at any meeting and
not disqualified from voting, whether or not he or they constitute a quorum, may
unanimously appoint another member of the Board of Directors to act at the
meeting in the place of any absent or disqualified member. The Board of
Directors shall have the power at any time to fill vacancies in, to change the
membership of, and to dissolve, any committee.
SECTION 4.4 Telephone Meetings.
Members of any committee designated by the Board of Directors may
participate in or hold a meeting by use of conference telephone or similar
communications equipment by means of which all persons participating in the
meeting can hear each other. Participation in a meeting pursuant to this Section
4.4 shall constitute presence in person at such meeting, except where a person
participates in the meeting for the express purpose of objecting, at the
beginning of the meeting, to the transaction of any business on the ground that
the meeting is not lawfully called or convened.
SECTION 4.5 Action Without Meeting.
Any action required or permitted to be taken at a meeting of any committee
designated by the Board of Directors may be taken without a meeting if a consent
in writing, setting forth the action so taken, is signed by all the members of
the committee and filed with the minutes of the committee proceedings. Such
consent shall have the same force and effect as a unanimous vote at a meeting.
ARTICLE V
OFFICERS
SECTION 5.1 Number and Title.
The elected officers of the Corporation shall be chosen by the Board of
Directors and shall be a President, a Vice President, a Secretary and a
Treasurer. The Board of Directors may also choose a Chairman of the Board, who
must be a Board member of the Board of Directors, and additional Vice
Presidents, Assistant Secretaries and/or Assistant Treasurers. One person may
hold any two or more of these offices and any one or more of the Vice Presidents
may be designated as an Executive Vice President or Senior Vice President.
SECTION 5.2 Term of Office; Vacancies.
So far as is practicable, all elected officers shall be elected by the
Board of Directors at the annual meeting of the Board of Directors in each year,
and except as otherwise provided in this Article V, shall hold office until the
next such meeting of the Board of Directors in the subsequent year and until
their respective successors are elected and qualified or until their earlier
resignation or removal. All appointed officers shall hold office at the pleasure
of the Board of Directors. If any vacancy shall occur in any office, the Board
of Directors may elect or appoint a successor to fill such vacancy for the
remainder of the term.
SECTION 5.3 Removal of Elected Officers.
Any elected officer may be removed at any time, with or without cause, by
affirmative vote of a majority of the whole Board of Directors, at any regular
meeting or at any special meeting called for such purpose.
SECTION 5.4 Resignations.
Any officer may resign at any time upon written notice of resignation to
the President, Secretary or Board of Directors of the Corporation. Any
resignation shall be effective immediately unless a date certain is
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specified for it to take effect, in which event it shall be effective upon such
date, and acceptance of any resignation shall not be necessary to make it
effective, irrespective of whether the resignation is tendered subject to such
acceptance.
SECTION 5.5 The Chairman of the Board.
The Chairman of the Board, if one shall be elected, shall preside at all
meetings of the Stockholders and Board of Directors. In addition, the Chairman
of the Board shall perform whatever duties and shall exercise all powers that
are given to him by the Board of Directors.
SECTION 5.6 President.
The President shall be the chief executive officer of the Corporation;
shall (in the absence of the Chairman of the Board, if one be elected) preside
at meetings of the Stockholders and Board of Directors; shall be ex officio a
member of all standing committees; shall have general and active management of
business of the corporation; shall implement the general directives, plans and
policies formulated by the Board of Directors; and shall further have such
duties, responsibilities and authorities as may be assigned to him by the Board
of Directors. He may sign, with any other proper officer, certificates for
shares of the Corporation and any deeds, bonds, mortgages, contracts and other
documents which the Board of Directors has authorized to be executed, except
where required by law to be otherwise signed and executed and except where the
signing and execution thereof shall be expressly delegated by the Board of
Directors or these Bylaws, to some other officer or agent of the Corporation. In
the absence of the President, his duties shall be performed and his authority
may be exercised by a Vice President of the Corporation as may have been
designated by the President with the right reserved to the Board of Directors to
designate or supersede any designation so made.
SECTION 5.7 Vice Presidents.
The several Vice Presidents shall have such powers and duties as may be
assigned to them by these Bylaws and as may from time to time be assigned to
them by the Board of Directors and may sign, with any other proper officer,
certificates for shares of the Corporation.
SECTION 5.8 Secretary.
The Secretary, if available, shall attend all meetings of the Board of
Directors and all meetings of the Stockholders and record the proceedings of the
meetings in a book to be kept for that purpose and shall perform like duties for
any committee of the Board of Directors as shall designate him to serve. He
shall give, or cause to be given, notice of all meetings of the Stockholders and
meetings of the Board of Directors and committees thereof and shall perform such
other duties incident to the office of secretary or as may be prescribed by the
Board of Directors or the President, under whose supervision he shall be. He
shall have custody of the corporate seal of the Corporation and he, or any
Assistant Secretary, or any other person whom the Board of Directors may
designate, shall have authority to affix the same to any instrument requiring
it, and when so affixed it may be attested by his signature or by the signature
of any Assistant Secretary or by the signature of such other person so affixing
such seal.
SECTION 5.9 Assistant Secretaries.
Each Assistant Secretary shall have the usual powers and duties pertaining
to his office, together with such other powers and duties as may be assigned to
him by the Board of Directors, the President or the Secretary. The Assistant
Secretary or such other person as may be designated by the President shall
exercise the powers of the Secretary during that officer's absence or inability
to act.
SECTION 5.10 Treasurer.
The Treasurer shall have the custody of and be responsible for the
corporate funds and securities, shall keep full and accurate accounts of
receipts and disbursements in the books belonging to the Corporation and shall
deposit all moneys and other valuable effects in the name and to the credit of
the Corporation in such
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depositories as may be designated by the Board of Directors. He shall disburse
the funds of the Corporation as may be ordered by the Board of Directors, taking
proper vouchers for such disbursements, and shall render to the President and
the Board of Directors, at its regular meetings, or when the Board of Directors
so requires, an account of all his transactions as Treasurer and of the
financial condition of the Corporation and he shall perform all other duties
incident to the position of Treasurer, or as may be prescribed by the Board of
Directors or the President. If required by the Board of Directors, he shall give
the Corporation a bond in such sum and with such surety or sureties as shall be
satisfactory to the Board of Directors for the faithful performance of the
duties of his office and for the restoration to the Corporation, in case of his
death, resignation, retirement or removal from office, of all books, papers,
vouchers, money and other property of whatever kind in his possession or under
his control belonging to the Corporation.
SECTION 5.11 Assistant Treasurers.
Each Assistant Treasurer shall have the usual powers and duties pertaining
to his office, together with such other powers and duties as may be assigned to
him by the Board of Directors, the President or the Treasurer. The Assistant
Treasurer or such other person designated by the President shall exercise the
power of the Treasurer during that officer's absence or inability to act.
SECTION 5.12 Subordinate Officers.
The Board of Directors may (i) appoint such other subordinate officers and
agents as it shall deem necessary who shall hold their offices for such terms,
have such authority and perform such duties as the Board of Directors may from
time to time determine, or (ii) delegate to any committee or officer the power
to appoint any such subordinate officers or agents.
SECTION 5.13 Salaries and Compensation.
The salary or other compensation of officers shall be fixed from time to
time by the Board of Directors. The Board of Directors may delegate to any
committee or officer the power to fix from time to time the salary or other
compensation of subordinate officers and agents appointed in accordance with the
provisions of Section 5.12.
ARTICLE VI
INDEMNIFICATION OF DIRECTORS AND OFFICERS
(a) The Corporation shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action,
suit or proceeding, whether civil, criminal, administrative or investigative
(other than an action by or in the right of the Corporation) by reason of the
fact that such person is or was, at any time prior to or during which this
Article VI is in effect, a director, officer, employee or agent of the
Corporation, or is or was, at any time prior to or during which this Article VI
is in effect, serving at the request of the Corporation as a director, officer,
employee or agent of another corporation, partnership, joint venture, trust,
employee benefit plan or other enterprise against reasonable expenses (including
attorneys' fees), judgments, fines, penalties, amounts paid in settlement and
other liabilities actually and reasonably incurred by such person in connection
with such action, suit or proceeding if such person acted in good faith and in a
manner he reasonably believed to be in or not opposed to the best interests of
the Corporation, and, with respect to any criminal action or proceeding, had no
reasonable cause to believe that his conduct was unlawful. The termination of
any action, suit or proceeding by judgment, order, settlement, conviction or
upon a plea of nolo contendere or its equivalent, shall not, of itself, create a
presumption that such person did not act in good faith and in a manner which he
reasonably believed to be in or not opposed to the best interests of the
Corporation, and, with respect to any criminal action or proceeding, had
reasonable cause to believe that his conduct was unlawful.
(b) The Corporation shall indemnify any person who was or is a party or is
threatened to be made a party to any threatened, pending or completed action or
suit by or in the right of the Corporation to procure a
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judgment in its favor by reason of the fact that such person is or was, at any
time prior to or during which this Article VI is in effect, a director, officer,
employee or agent of the Corporation, or is or was, at any time prior to or
during which this Article VI is in effect, serving at the request of the
Corporation as a director, officer, employee or agent of another corporation,
partnership, joint venture, trust or other enterprise against expenses
(including attorneys' fees) actually and reasonably incurred by such person in
connection with the defense or settlement of such action or suit if such person
acted in good faith and in a manner he reasonably believed to be in or not
opposed to the best interests of the Corporation; provided, that no
indemnification shall be made under this sub-section (b) in respect of any
claim, issue or matter as to which such person shall have been adjudged to be
liable to the Corporation unless and only to the extent that the Delaware Court
of Chancery, or other court of appropriate jurisdiction in which such action or
suit was brought, shall determine upon application that, despite the
adjudication of liability but in view of all the circumstances of the case, such
person is fairly and reasonably entitled to indemnity for such expenses which
the Delaware Court of Chancery, or such other court shall deem proper.
(c) Any indemnification under sub-sections (a) or (b) of this Article VI
(unless ordered by the Delaware Court of Chancery or other court of appropriate
jurisdiction) shall be made by the Corporation only as authorized in the
specific case upon a determination that indemnification of such person is proper
in the circumstances because he has met the applicable standard of conduct set
forth in sub-sections (a) and (b). Such determination shall be made (1) by the
Board of Directors by a majority vote of a quorum consisting of directors not
parties to such action, suit or proceeding; or (2) if such a quorum is not
obtainable, or, even if obtainable a quorum of disinterested directors so
directs, by independent legal counsel selected by the Board of Directors, in
written opinion; or (3) by the Stockholders. In the event a determination is
made under this sub-section (c) that the director, officer, employee or agent
has met the applicable standard of conduct as to some matters but not as to
others, amounts to be indemnified may be reasonably prorated.
(d) Expenses (including attorneys' fees) incurred by a person who is or was
a director or officer of the Corporation in appearing at, participating in or
defending any threatened, pending or completed action, suit or proceeding,
whether civil, criminal, administrative or investigative, shall be paid by the
Corporation at reasonable intervals in advance of the final disposition of such
action, suit or proceeding upon receipt of an undertaking by or on behalf of the
director or officer to repay such amount if it shall ultimately be determined
that he is not entitled to be indemnified by the Corporation as authorized by
this Article VI.
(e) If a claim under this Article VI is not paid in full by the Corporation
within ninety days after a written claim has been received by the Corporation,
the claimant may at any time thereafter bring suit against the Corporation to
recover the unpaid amount of the claim and, if successful in whole or in part,
the claimant shall be entitled to be paid also the expense of prosecuting such
claim. It shall be a defense to any such action (other than an action brought to
enforce a claim for expenses incurred in defending any proceeding in advance of
its final disposition where the required undertaking, if any is required, has
been tendered to the Corporation) that the claimant has not met the standards of
conduct which make it permissible under the Delaware General Corporation Law for
the Corporation to indemnify the claimant for the amount claimed, but the burden
of proving such defense shall be on the Corporation. Neither the failure of the
Corporation (including its Board of Directors, independent legal counsel, or its
stockholders) to have made a determination prior to the commencement of such
action that indemnification of the claimant is proper in the circumstances
because he or she has met the applicable standard of conduct set forth in the
Delaware General Corporation Law, nor an actual determination by the Corporation
(including its Board of Directors, independent legal counsel, or its
stockholders) that the claimant has not met such applicable standard of conduct,
shall be a defense to the action or create a presumption that the claimant has
not met the applicable standard of conduct.
(f) It is the intention of the Corporation to indemnify the persons
referred to in this Article VI to the fullest extent permitted by law and with
respect to any action, suit or proceeding arising from events which occur at any
time prior to or during which this Article VI is in effect. The indemnification
and advancement of expenses provided by this Article VI shall not be deemed
exclusive of any other rights to which those seeking indemnification or
advancement of expenses may be or become entitled under any law, the
Corporation's Certificate of Incorporation, these Bylaws, agreement, the vote of
Stockholders or disinterested directors or
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otherwise, or under any policy or policies of insurance purchased and maintained
by the Corporation on behalf of any such person, both as to action in his
official capacity and as to action in another capacity while holding such
office, and shall continue as to a person who has ceased to be a director,
officer, employee or agent and shall inure to the benefit of the heirs,
executors and administrators of such person. The provisions of this Article VI
are contract rights which (i) are for the benefit of, and may be enforced by,
each director or officer of the Corporation the same as if set forth in their
entirety in a written instrument duly executed and delivered by the Corporation
and each such director or officer and (ii) constitute a continuing offer to all
present and future directors or officers of the Corporation. The Corporation, by
its adoption of these Bylaws, (i) acknowledges and agrees that each present and
future director or officer of the Corporation has relied upon and will continue
to rely upon the provisions of this Article VI in becoming, and serving as, a
director or officer of the Corporation or, if requested by the Corporation, a
director, officer, employee, agent, trustee or the like of another corporation
or other enterprise, (ii) waives reliance upon, and all notices of acceptance
of, such provisions by such directors or officers and (iii) acknowledges and
agrees that no present or future director or officer of the Corporation shall be
prejudiced in his right to enforce the provisions of this Article VI in
accordance with their terms by any act or failure to act on the part of the
Corporation. No amendment, modification or repeal of this Article VI or any
provision hereof shall in any manner terminate, reduce or impair the right of
any past, present or future director or officer of the Corporation to be
indemnified or advanced expenses by the Corporation, nor the obligation of the
Corporation to indemnify or advance expenses to any such director or officer
under and in accordance with the provisions of this Article VI as in effect
immediately prior to such amendment, modification or repeal with respect to
claims arising from or relating to matters occurring, in whole or in part, prior
to such amendment, modification or repeal, regardless of when such claim may
arise or be asserted. The provisions of this Article VI shall be binding upon
the Corporation and its successors and assigns and shall inure to the benefit of
each director or officer of the Corporation and his or her heirs, legal
representatives and assigns.
(g) The indemnification provided by this Article VI shall be subject to all
valid and applicable laws, and, in the event this Article VI or any of the
provisions hereof or the indemnification contemplated hereby are found to be
inconsistent with or contrary to any such valid laws, the latter shall be deemed
to control and this Article VI shall be regarded as modified accordingly, and,
as so modified, to continue in full force and effect.
ARTICLE VII
CAPITAL STOCK
SECTION 7.1 Certificates of Stock.
Certificates of stock shall be issued to each Stockholder certifying the
number of shares owned by him in the Corporation and shall be in a form not
inconsistent with the Certificate of Incorporation and as approved by the Board
of Directors. The certificates shall be signed by the Chairman of the Board, the
President or a Vice President and by the Secretary or an Assistant Secretary, or
the Treasurer or an Assistant Treasurer and may be sealed with the seal of the
Corporation or a facsimile thereof. Any or all of the signatures on the
certificate may be a facsimile. In case any officer, transfer agent or registrar
who has signed or whose facsimile signature has been placed upon a certificate
shall have ceased to be such officer, transfer agent or registrar before such
certificate is issued, it may be issued by the Corporation with the same effect
as if he were such officer, transfer agent or registrar at the date of issue. If
the Corporation shall be authorized to issue more than one (1) class of stock or
more than one (1) series of any class, the powers, designations, preferences and
relative, participating, optional or other special rights of each class of stock
or series thereof and the qualifications, limitations or restrictions of such
preferences and/or rights shall be set forth in full or summarized on the face
or back of the certificate which the Corporation shall issue to represent such
class or series of stock, provided that, except as otherwise provided by
statute, in lieu of the foregoing requirements, there may be set forth on the
face or back of the certificate which the Corporation shall issue to represent
such class or series of stock, a statement that the Corporation will furnish
without charge to each Stockholder who so requests the powers, designations,
preferences and relative, participating, optional or other special rights of
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each class of stock or series thereof and the qualifications, limitations or
restrictions of such preferences and/or rights.
SECTION 7.2 Lost Certificates.
The Board of Directors may direct a new certificate to be issued in place
of any certificate theretofore issued by the Corporation alleged to have been
lost, stolen or destroyed, upon the making of an affidavit of that fact by the
owner of such certificate, or his legal representative. When authorizing the
issuance of a new certificate, the Board of Directors may in its discretion, as
a condition precedent to the issuance thereof, require the owner, or his legal
representative, to give a bond in such form and substance with such surety as it
may direct, to indemnify the Corporation against any claim that may be made on
account of the alleged loss, theft or destruction of such certificate or the
issuance of such new certificate.
SECTION 7.3 Fixing Date for Determination of Stockholders of Record for Certain
Purposes.
(a) In order that the Corporation may determine the Stockholders entitled
to receive payment of any dividend or other distribution or allotment of any
rights, or entitled to exercise any rights in respect of any change, conversion
or exchange of capital stock or for the purpose of any other lawful action, the
Board of Directors may fix, in advance, a record date, which shall not be more
than sixty (60) days prior to the date of payment of such dividend or other
distribution or allotment of such rights or the date when any such rights in
respect of any change, conversion or exchange of stock may be exercised or the
date of such other action. In such a case, only Stockholders of record on the
date so fixed shall be entitled to receive any such dividend or other
distribution or allotment of rights or to exercise such rights or for any other
purpose, as the case may be, notwithstanding any transfer of any stock on the
books of the Corporation after any such record date fixed as aforesaid.
(b) If no record date is fixed, the record date for determining
Stockholders for any such purpose shall be at the close of business on the day
on which the Board of Directors adopts the resolution relating thereto.
SECTION 7.4 Dividends.
Subject to the provisions of the Corporation's Certificate of
Incorporation, if any, and except as otherwise provided by law, the directors
may declare dividends upon the capital stock of the Corporation as and when they
deem it to be expedient. Such dividends may be paid in cash, in property or in
shares of the Corporation's capital stock. Before declaring any dividend there
may be set apart out of the funds of the Corporation available for dividends,
such sum or sums as the directors from time to time in their discretion think
proper for working capital or as a reserve fund to meet contingencies or for
equalizing dividends, or for such other purposes as the directors shall think
conducive to the interests of the Corporation and the directors may modify or
abolish any such reserve in the manner in which it was created.
SECTION 7.5 Registered Stockholders.
Except as expressly provided by law, the Corporation's Certificate of
Incorporation or these Bylaws, the Corporation shall be entitled to treat
registered Stockholders as the only holders and owners in fact of the shares
standing in their respective names and the Corporation shall not be bound to
recognize any equitable or other claim to or interest in such shares on the part
of any other person, regardless of whether it shall have express or other notice
thereof.
SECTION 7.6 Transfer of Stock.
Transfers of shares of the capital stock of the Corporation shall be made
only on the books of the Corporation by the registered owners thereof, or by
their legal representatives or their duly authorized attorneys. Upon any such
transfers the old certificates shall be surrendered to the Corporation by the
delivery thereof to the person in charge of the stock transfer books and
ledgers, by whom they shall be cancelled and new certificates shall thereupon be
issued.
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ARTICLE VIII
MISCELLANEOUS PROVISIONS
SECTION 8.1 Corporate Seal.
If one be adopted, the corporate seal shall have inscribed thereon the name
of the Corporation and shall be in such form as may be approved by the Board of
Directors. Said seal may be used by causing it or a facsimile thereof to be
impressed or affixed or in any manner reproduced.
SECTION 8.2 Fiscal Year.
The fiscal year of the Corporation shall be fixed by resolution of the
Board of Directors.
SECTION 8.3 Checks, Drafts, Notes.
All checks, drafts or other orders for the payment of money, notes or other
evidences of indebtedness issued in the name of the Corporation shall be signed
by such officer or officers, agent or agents of the Corporation, and in such
manner as shall from time to time be determined by resolution (whether general
or special) of the Board of Directors or may be prescribed by any officer or
officers, or any officer and agent jointly, thereunto duly authorized by the
Board of Directors.
SECTION 8.4 Notice and Waiver of Notice.
Whenever notice is required to be given to any director or Stockholder
under the provisions of applicable law, the Corporation's Certificate of
Incorporation or these Bylaws, such notice shall be in writing and delivered
either (i) personally, or (ii) by registered or certified mail, or (iii) by
telegram, telecopy, or similar facsimile means (delivered during the recipient's
regular business hours). Such notice shall be sent to such director or
Stockholder at the address or telecopy number as it appears on the records of
the Corporation, unless prior to the sending of such notice he has designated,
in a written request to the Secretary of the Corporation, another address or
telecopy number to which notices are to be sent. Notices shall be deemed given
when received, if sent by telegram, telex, telecopy or similar facsimile means
(confirmation of such receipt by confirmed facsimile transmission being deemed
receipt of communications sent by telex, telecopy or other facsimile means); and
when delivered and receipted for (or upon the date of attempted delivery where
delivery is refused), if hand-delivered, sent by express courier or delivery
service, or sent by certified or registered mail. Whenever notice is required to
be given under any provision of law, the Corporation's Certificate of
Incorporation or these Bylaws, a waiver thereof in writing, by telegraph, cable
or other form of recorded communication, signed by the person or persons
entitled to said notice, whether before or after the time stated therein, shall
be deemed equivalent to notice. Attendance of a person at a meeting shall
constitute a waiver of notice of such meeting, except when the person attends a
meeting for the express purpose of objecting, at the beginning of the meeting,
to the transaction of any business on the ground that the meeting is not
lawfully called or convened. Neither the business to be transacted at, nor the
purpose of, any regular or special meeting of the Stockholders, directors, or
members of a committee of directors need be specified in any written waiver of
notice unless so required by the Corporation's Certificate of Incorporation or
these Bylaws.
SECTION 8.5 Examination of Books and Records.
The Board of Directors shall determine from time to time whether, and if
allowed, when and under what conditions and regulations the accounts and books
of the Corporation (except such as may by statute be specifically opened to
inspection) or any of them shall be open to inspection by the Stockholders, and
the Stockholders' rights in this respect are and shall be restricted and limited
accordingly.
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SECTION 8.6 Voting Upon Shares Held by the Corporation.
Unless otherwise provided by law or by the Board of Directors, the Chairman
of the Board of Directors, if one shall be elected, or the President, if a
Chairman of the Board of Directors shall not be elected, acting on behalf of the
Corporation, shall have full power and authority to attend and to act and to
vote at any meeting of Stockholders of any corporation in which the Corporation
may hold stock and, at any such meeting, shall possess and may exercise any and
all of the rights and powers incident to the ownership of such stock which, as
the owner thereof, the Corporation might have possessed and exercised, if
present. The Board of Directors by resolution from time to time may confer like
powers upon any person or persons.
ARTICLE IX
AMENDMENTS
SECTION 9.1 Amendment.
Except as otherwise expressly provided in the Corporation's Certificate of
Incorporation, the directors, by the affirmative vote of a majority of the
entire Board of Directors and without the assent or vote of the Stockholders,
may at any meeting make, repeal, alter, amend or rescind any of these Bylaws.
The Stockholders shall not make, repeal, alter, amend or rescind any of the
provisions of these Bylaws except by the holders of not less than a majority of
the total voting power of all shares of stock of the Corporation entitled to
vote in the election of directors, considered for purposes of this Article IX as
one class.
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<PAGE> 1
EXHIBIT (c)(2)
STOCKHOLDER AGREEMENT
Stockholder Agreement dated as of July 1, 1996, between AI Partners
L.P. ("Parent") and Randolph M. Moity, Sr. ("Stockholder").
WHEREAS, Stockholder desires that AMBAR, Inc., a Delaware corporation
(the "Company"), Parent and Purchaser, a Delaware corporation and wholly owned
subsidiary of Parent ("Purchaser"), enter into an Agreement and Plan of Merger
dated the date hereof (as the same may be amended or supplemented, the "Merger
Agreement") with respect to the merger of Purchaser with and into the Company
(the "Merger"); and
WHEREAS, Stockholder is executing this Agreement as an inducement to
Parent to enter into and execute, and to cause Purchaser to enter into and
execute, the Merger Agreement;
NOW, THEREFORE, in consideration of the execution and delivery by
Parent and Purchaser of the Merger Agreement and the mutual covenants,
conditions and agreements contained herein and therein, the parties agree as
follows:
SECTION 1. Representations and Warranties.
Stockholder represents and warrants to Parent as follows:
(a) Stockholder is the record and beneficial owner of
1,866,411 shares of Common Stock, par value $.01 per share, of the Company (the
"Company Common Stock" and such Stockholder's shares of Company Common Stock and
any shares of Company Common Stock acquired hereafter including upon the
exercise of outstanding options being referred to herein as "Shares"). Except
for such Shares, and options to purchase 30,000 Shares which are currently
unexercisable, Stockholder is not the record or beneficial owner of any shares
of Company Common Stock.
(b) This Agreement has been duly authorized, executed and
delivered by Stockholder and constitutes the legal, valid and binding obligation
of Stockholder, enforceable against Stockholder in accordance with its terms.
Neither the execution and delivery of this Agreement nor the consummation by
Stockholder of the transactions contemplated hereby will result in a violation
of, or a default under, or conflict with, any contract, trust, commitment,
agreement, understanding, arrangement or restriction of any kind to which
Stockholder is a party or bound or to which Stockholder's Shares are subject. If
Stockholder's Shares constitute community property, this Agreement has been duly
authorized, executed and delivered by, and constitutes a valid and binding
agreement of, Stockholder's spouse, enforceable against such person in
accordance with its terms. Consummation by Stockholder of the transactions
contemplated hereby will not violate, or require any consent, approval, or
notice under, any provision of any judgment, order, decree, statute,
<PAGE> 2
law, rule or regulation applicable to Stockholder or Stockholder's Shares,
except for any necessary filing under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976.
(c) Stockholder's Shares and the certificates representing
such Shares are now and at all times during the term hereof will be held by
Stockholder, or by a nominee or custodian for the benefit of Stockholder, free
and clear of all liens, claims, security interests, proxies, voting trusts or
agreements, understandings or arrangements or any other encumbrances whatsoever,
except for any such encumbrances or proxies arising hereunder.
(d) No broker, investment banker, financial adviser or other
person is entitled to any broker's, finder's, financial adviser's or other
similar fee or commission in connection with the transactions contemplated
hereby based upon arrangements made by or on behalf of Stockholder.
(e) Stockholder understands and acknowledges that Parent is
entering into, and causing Purchaser to enter into, the Merger Agreement in
reliance upon Stockholder's execution and delivery of this Agreement.
Stockholder acknowledges that the irrevocable proxy set forth in Section 4 is
granted in consideration for the execution and delivery of the Merger Agreement
by Parent and Purchaser.
SECTION 2. Purchase and Sale of Shares.
Stockholder hereby agrees to sell to Purchaser, and Purchaser hereby
agrees to purchase, all Shares at a price per share equal to the price paid for
Company Common Stock in the Offer; provided that such obligation to sell and
such obligation to purchase is subject to Purchaser having accepted shares for
payment under the Offer. Stockholder may tender Shares into the Offer and
Purchaser may direct that Stockholder tender such Shares. Any Shares not
purchased in the Offer will be purchased at the same time as payment is made
under the Offer and Purchaser may purchase up to 100,000 Shares by delivery of a
promissory note in the form attached hereto in the amount of the purchase price
therefor.
SECTION 3. Covenants.
Stockholder agrees with, and covenants to, Parent as follows:
(a) Stockholder shall not, except as contemplated by the terms
of this Agreement, (i) transfer (which term shall include, without limitation,
for the purposes of this Agreement, any sale, gift, pledge or other
disposition), or consent to any transfer of, any or all of Stockholder's Shares
or any interest therein, (ii) enter into any contract, option or other agreement
of understanding with respect to any transfer of any or all of such Shares or
any interest therein, (iii) grant any proxy, power-of-attorney or other
authorization in or with respect to such Shares, (iv) deposit such Shares into a
voting trust or enter into a voting agreement or arrangement with respect to
such Shares or (v) take any other action that would in any way restrict, limit
or interfere with the performance of its obligations hereunder or the
transactions contemplated hereby.
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<PAGE> 3
(b) Subject to Section 8, Stockholder shall not, nor shall it
permit any investment banker, attorney or other adviser or representative of
Stockholder to, directly or indirectly, (i) solicit, initiate or encourage the
submission of, any takeover proposal or (ii) participate in any discussions or
negotiations regarding, or furnish to any person any information with respect
to, or take any other action to facilitate any inquiries or the making of any
proposal that constitutes, or may reasonably be expected to lead to, any
takeover proposal. Without limiting the foregoing, it is understood that any
violation of the restrictions set forth in the preceding sentence by an
investment banker, attorney or other adviser or representative of Stockholder,
whether or not such person is purporting to act on behalf of such Stockholder or
otherwise, shall be deemed to be a violation of this Section 3(b) by
Stockholder.
(c) Stockholder shall not take any action which would
restrict, limit or frustrate in any way the transactions contemplated by this
Agreement.
(d) Subject to Section 7 hereof, at any meeting of the
Company's Stockholders or at any adjournment thereof or in any other
circumstances upon which their vote, consent or other approval is sought,
Stockholder shall vote (or cause to be voted) Stockholder's Shares against (i)
any merger agreement or merger (other than the Merger Agreement and the Merger),
consolidation, combination, sale of substantial assets, reorganization, joint
venture, recapitalization, dissolution, liquidation or winding up of or by the
Company and (ii) any amendment of the Company's Certificate of Incorporation or
By-laws or other proposal or transaction involving the Company or any of its
subsidiaries which amendment or other proposal or transaction would in any
manner impede, frustrate, prevent or nullify, or result in a breach of any
covenant, representation or warranty or any other obligation or agreement of the
Company under or with respect to, the Offer, the Merger, the Merger Agreement or
any of the other transactions contemplated by the Merger Agreement (each of the
foregoing in clause (i) or (ii) above, a "Competing Transaction").
SECTION 4. Grant of Irrevocable Proxy: Appointment of Proxy.
(a) Stockholder hereby irrevocably grants to, and appoints,
Harold W. Pote and Robert F. Semmens, in their respective capacities as officers
of Parent, and any individual who shall hereafter succeed to any such office of
Parent, and each of them individually, Stockholder's proxy and attorney-in-fact
(with full power of substitution), for and in the name, place and stead of
Stockholder, to vote Stockholder's Shares, or grant a consent or approval in
respect of Shares against any Competing Transaction.
(b) Stockholder represents that any proxies heretofore given
in respect of Stockholder's Shares are not irrevocable, and that any such
proxies are hereby revoked.
(c) Stockholder hereby affirms that the irrevocable proxy set
forth in this Section 4 is given in connection with the execution of the Merger
Agreement, and that such irrevocable proxy is given to secure the performance of
the duties of Stockholder under this Agreement. Stockholder hereby further
affirms that the irrevocable proxy is coupled with an interest and may
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<PAGE> 4
under no circumstances be revoked. Such Stockholder hereby ratifies and confirms
all that such irrevocable proxy may lawfully do or cause to be done by virtue
hereof. Such irrevocable proxy is executed and intended to be irrevocable in
accordance with the provision of Section 212(e) of the Delaware General
Corporation Law (the "DGCL").
SECTION 5. Certain Events.
Stockholder agrees that this Agreement and the obligations hereunder
shall attach to Stockholder's Shares and shall be binding upon any person or
entity to which legal or beneficial ownership of such Shares shall pass, whether
by operation of law or otherwise, including without limitation Stockholder's
heirs, guardians, administrators or successors. In the event of any stock split,
stock dividend, merger, reorganization, recapitalization or other change in the
capital structure of the Company affecting the Company Common Stock, or the
acquisition of additional shares of Company Common Stock or other voting
securities of the Company by Stockholder, this Agreement and the obligations
hereunder shall attach to any additional shares of Company Common Stock or other
voting securities of the Company issued to or acquired by Stockholder.
SECTION 6. Legend.
Stockholder agrees that Stockholder will deliver to the Company, within
5 business days after the date hereof, any and all certificates representing
Stockholder's Shares in order that the Company may inscribe upon such
certificates the following legend: "The shares of Common Stock, $.01 par value,
of AMBAR, Inc. represented by this certificate are subject to a Stockholder
Agreement dated as of July 1, 1996, and may not be sold or otherwise
transferred, except in accordance therewith. Copies of such Agreement may be
obtained at the principal executive offices of AMBAR, Inc."
SECTION 7. Voidability.
If prior to the execution hereof, the Board of Directors of the Company
shall not have duly and validly authorized and approved by all necessary
corporate action, this Agreement, the Merger Agreement and the transactions
contemplated hereby and thereby, or if, subsequent to any such approval or
authorization, the Board of Directors withdraws any such authorization and
approval so that by the execution and delivery hereof Parent or Purchaser would
become, or could reasonably be expected to become an "interested stockholder"
with whom the Company would be prevented for any period pursuant to Section 203
of the DGCL or the Certificate of Incorporation of the Company from engaging
in any "business combination" (as such terms are defined in Section 203 of the
DGCL) then this Agreement shall be void and unenforceable until such time as
such authorization and approval shall have been duly and validly obtained.
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<PAGE> 5
SECTION 8. Stockholder Capacity.
By executing this Agreement Stockholder makes no agreement or
understanding herein in his capacity as a director and officer of the Company.
Stockholder signs solely in his capacity as the record holder and beneficial
owner of Stockholder's Shares and nothing herein shall limit or affect any
actions taken by Stockholder in his capacity as an officer or director of the
Company to the extent specifically permitted by the Merger Agreement. No action
taken by Stockholder solely in his capacity as an officer or director of the
Company shall be deemed to be a breach of this Agreement; provided, however,
that no such action by Stockholder shall excuse Stockholder from his obligations
under Section 2 of this Agreement.
SECTION 9. Further Assurances.
Stockholder shall, upon request of Parent, execute and deliver any
additional documents and take such further actions as may reasonably be deemed
by Parent to be necessary or desirable to carry out the provisions hereof and to
vest the power to vote Stockholder's Shares as contemplated by Section 4 in
Parent and the other irrevocable proxies described therein.
SECTION 10. Termination.
This Agreement, and all rights and obligations of the parties
hereunder, shall terminate upon the first to occur of (i) the Effective Time of
the Merger or (ii) the termination of the Merger Agreement pursuant to Section
8.1, other than Section 8.1(j), thereof.
SECTION 11. Miscellaneous.
(a) Capitalized terms used and not otherwise defined in this
Agreement shall have the respective meanings assigned such terms in the Merger
Agreement.
(b) All notices, requests, claims, demands and other
communications under this Agreement shall be in writing and shall be deemed
given if delivered personally or sent by overnight courier (providing proof of
delivery) to the parties at the following addresses (or at such other address
for a party as shall be specified by like notice): (i) if to Parent, to the
address set forth in Section 9.5 of the Merger Agreement; and (ii) if to
Stockholder, to Randolph M. Moity, c/o AMBAR, Inc., The AMBAR Building, 221 Rue
de Jean, Suite 300, Lafayette, LA 70508, or such other address as may be
specified in writing by Stockholder.
(c) The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.
(d) This Agreement may be executed in counterparts, each of
which shall be considered one and the same agreement and shall become effective
as to any Stockholder when one
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<PAGE> 6
or more counterparts have been signed by each of Parent and Stockholder and
delivered to Parent and Stockholder.
(e) This Agreement (including the documents and instruments
referred to herein) constitutes the entire agreement, and supersedes all prior
agreements and understandings, both written and oral, among the parties with
respect to the subject matter hereof.
(f) This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, regardless of the laws that
might otherwise govern under applicable principles of conflicts of laws thereof.
(g) Neither this Agreement nor any of the rights, interests or
obligations under this Agreement shall be assigned, in whole or in part, by
operation of law or otherwise, by any of the parties without the prior written
consent of the other parties, except by laws of descent, provided that Parent
may assign any of its rights and obligations to any affiliate (as defined in
Rule 12b-2 under the Exchange Act) of Parent if such affiliate expressly assumes
in writing the obligations of Parent under this Agreement, but no such
assignment shall relieve Parent of its obligations hereunder.
(h) If any term, provision, covenant or restriction herein, or
the application thereof to any circumstance, shall, to any extent, be held by a
court of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions herein and the
application thereof to any other circumstances, shall remain in full force and
effect, shall not in any way be affected, impaired or invalidated, and shall be
enforced to the fullest extent permitted by law.
(i) Stockholder agrees that irreparable damage would occur and
that Parent would not have any adequate remedy at law in the event that any of
the provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached. It is accordingly agreed that Parent
shall be entitled to an injunction or injunctions to prevent breaches by any
Stockholder of this Agreement and to enforce specifically the terms and
provisions of this Agreement in any court of the United States located in the
State of Delaware or in Delaware state court, this being in addition to any
other remedy to which they are entitled at law or in equity. In addition, each
of the parties hereto (i) consents to submit such party 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 such party 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 such party will not
bring any action relating to this Agreement of any of the transactions
contemplated hereby in any court other than a Federal court sitting in the State
of Delaware or a Delaware state court.
(j) No amendment, modification or waiver in respect of this
Agreement shall be effective against any party unless it shall be in writing and
signed by such party.
6
<PAGE> 7
IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed on its behalf by its officers thereunto duly authorized, all at or on
the day and year first above written.
Attest: /s/ Curtis R. Hearn /s/ Randolph M. Moity, Sr.
--------------------------- ----------------------------------
Name: CURTIS R. HEARN RANDOLPH M. MOITY, SR.
Title:
AI PARTNERS L.P.
By AI-GP, L.L.C., general partner
By Energy Fund GP, Inc., member
Attest: /s/ Stacey W. Goff By: /s/ Robert F. Semmens
---------------------------- ----------------------------------
Name: STACEY W. GOFF Name: ROBERT F. SEMMENS
Title: Title: Managing Director
7
<PAGE> 8
PROMISSORY NOTE
$1,800,000.00 July ___, 1996
For value received, A1 Acquisitions Corp., a Delaware corporation (the
"Maker"), promises to pay to the order of Randolph M. Moity, Sr., a resident of
Lafayette, Louisiana (the "Payee"), at such place as Payee may specify, the
principal sum of One Million Eight Hundred Thousand and No/100 Dollars
($1,800,000.00), in legal and lawful money of the United States of America, with
interest thereon from the date hereof until paid at the lesser of (a) the
Contract Rate or (b) the Maximum Rate (as such terms are hereinafter defined)
from time to time in effect.
As used herein, the term "Contract Rate" means seven percent (7%) per
annum (calculated on the basis of actual days elapsed, but computed as if each
calendar year consisted of 360 days). As used herein, the term "Maximum Rate"
means the maximum rate of interest per annum which the Payee is allowed to
contract for, charge, take, reserve, or receive under applicable federal or
state law.
This Note shall mature, and all outstanding principal and accrued
interest shall be due and payable upon the earlier of (i) the expiration of the
primary term, unless extended, of the Employment Agreement, dated July 1, 1992,
between AMBAR, Inc., a Delaware corporation (the "Company") and the Payee (the
"Employee Agreement"), or (ii) the expiration of two (2) months after the
appointment by the Board of Directors of the Company of a new Chief Executive
Officer of the Company (the "Maturity Date"). Interest on the unpaid principal
of this Note shall accrue and be due and payable in arrears on the Maturity
Date. All past due principal and, to the extent allowed by applicable law,
accrued interest, shall also bear interest at the lesser of the Contract Rate
plus 5% per annum or the Maximum Rate.
Maker shall have the right and privilege of prepaying all or any
portion of this Note without premium or penalty.
The obligations of Maker under this Note may be satisfied by offsetting
against the Note any liquidated damages (the "Liquidated Damages") to which
Maker or its successor is entitled pursuant to Section 11 of the Employment
Agreement.
Until all the obligations of the Company hereunder are paid in full,
the Company agrees that it will not declare or pay any dividends on its common
stock (other than stock dividends).
It is the intent of Maker and Payee in the execution and performance of
this Note to remain in strict compliance with any applicable usury laws from
time to time in effect. In furtherance thereof, Maker and Payee stipulate and
agree that none of the terms and provisions contained in this Note shall ever be
construed to create a contract to pay for the use, forbearance, or detention of
1
<PAGE> 9
money with interest at a rate or in an amount in excess of the maximum rate or
amount of interest permitted to be charged under applicable federal or state
law.
If a default in the punctual payment of this Note or any portion hereof
occurs and this Note is placed in the hands of an attorney for collection, or
suit is brought on same, or the same is collected through probate, bankruptcy or
other judicial proceedings, then the Maker agrees and promises to pay reasonable
attorneys' fees and other costs of collection incurred in connection with such
collection.
The Maker, and each surety, endorser, guarantor, and other party ever
liable for the payment of any sum of money hereunder, jointly and severally
waive demand, presentment, protest, notice of nonpayment, notice of intention to
accelerate, notice of protest and any and all lack of diligence or delay in
collection or the filing of suit hereon which may occur, and agree that their
liability on or with respect to this Note shall not be affected by any renewal
or extension in the time of payment hereof, by any indulgences, or by any
release or change in any security for the payment of this Note, and hereby
consent to any and all renewals, extensions, indulgences, releases or changes,
regardless of the number thereof.
This Note shall be governed in all respects by the laws of the State of
Delaware.
IN WITNESS WHEREOF, the Maker has executed this Note as of the date set
forth above.
AI ACQUISITIONS CORP.
By __________________________________
Name:
Title:
<PAGE> 1
EXHIBIT (c)(3)
STOCKHOLDER AGREEMENT
Stockholder Agreement dated as of July 1, 1996, between AI Partners
L.P. ("Parent") and Kenneth J. Boutte ("Stockholder").
WHEREAS, Stockholder desires that AMBAR, Inc., a Delaware corporation
(the "Company"), Parent and Purchaser, a Delaware corporation and wholly owned
subsidiary of Parent ("Purchaser"), enter into an Agreement and Plan of Merger
dated the date hereof (as the same may be amended or supplemented, the "Merger
Agreement") with respect to the merger of Purchaser with and into the Company
(the "Merger"); and
WHEREAS, Stockholder is executing this Agreement as an inducement to
Parent to enter into and execute, and to cause Purchaser to enter into and
execute, the Merger Agreement;
NOW, THEREFORE, in consideration of the execution and delivery by
Parent and Purchaser of the Merger Agreement and the mutual covenants,
conditions and agreements contained herein and therein, the parties agree as
follows:
SECTION 1. Representations and Warranties.
Stockholder represents and warrants to Parent as follows:
(a) Stockholder is the record and beneficial owner of 227,424
shares of Common Stock, par value $.01 per share, of the Company (the "Company
Common Stock" and such Stockholder's shares of Company Common Stock and any
shares of Company Common Stock acquired hereafter including upon the exercise of
outstanding options being referred to herein as "Shares"). Except for such
Shares, and options to purchase 5,000 Shares which are currently unexercisable,
Stockholder is not the record or beneficial owner of any shares of Company
Common Stock.
(b) This Agreement has been duly authorized, executed and
delivered by Stockholder and constitutes the legal, valid and binding obligation
of Stockholder, enforceable against Stockholder in accordance with its terms.
Neither the execution and delivery of this Agreement nor the consummation by
Stockholder of the transactions contemplated hereby will result in a violation
of, or a default under, or conflict with, any contract, trust, commitment,
agreement, understanding, arrangement or restriction of any kind to which
Stockholder is a party or bound or to which Stockholder's Shares are subject. If
Stockholder's Shares constitute community property, this Agreement has been duly
authorized, executed and delivered by, and constitutes a valid and binding
agreement of, Stockholder's spouse, enforceable against such person in
accordance with its terms. Consummation by Stockholder of the transactions
contemplated hereby will not violate, or require any consent, approval, or
notice under, any provision of any judgment, order, decree, statute,
<PAGE> 2
law, rule or regulation applicable to Stockholder or Stockholder's Shares,
except for any necessary filing under the Hart-Scott-Rodino Antitrust
Improvements Act of 1976.
(c) Stockholder's Shares and the certificates representing
such Shares are now and at all times during the term hereof will be held by
Stockholder, or by a nominee or custodian for the benefit of Stockholder, free
and clear of all liens, claims, security interests, proxies, voting trusts or
agreements, understandings or arrangements or any other encumbrances whatsoever,
except for any such encumbrances or proxies arising hereunder.
(d) No broker, investment banker, financial adviser or other
person is entitled to any broker's, finder's, financial adviser's or other
similar fee or commission in connection with the transactions contemplated
hereby based upon arrangements made by or on behalf of Stockholder.
(e) Stockholder understands and acknowledges that Parent is
entering into, and causing Purchaser to enter into, the Merger Agreement in
reliance upon Stockholder's execution and delivery of this Agreement.
Stockholder acknowledges that the irrevocable proxy set forth in Section 4 is
granted in consideration for the execution and delivery of the Merger Agreement
by Parent and Purchaser.
SECTION 2. Purchase and Sale of Shares.
Stockholder hereby agrees to sell to Purchaser, and Purchaser hereby
agrees to purchase, all Shares at a price per share equal to the price paid for
Company Common Stock in the Offer; provided that such obligation to sell and
such obligation to purchase is subject to Purchaser having accepted shares for
payment under the Offer. Stockholder may tender Shares into the Offer and
Purchaser may direct that Stockholder tender such Shares. Any Shares not
purchased in the Offer will be purchased at the same time as payment is made
under the Offer.
SECTION 3. Covenants.
Stockholder agrees with, and covenants to, Parent as follows:
(a) Stockholder shall not, except as contemplated by the terms
of this Agreement, (i) transfer (which term shall include, without limitation,
for the purposes of this Agreement, any sale, gift, pledge or other
disposition), or consent to any transfer of, any or all of Stockholder's Shares
or any interest therein, (ii) enter into any contract, option or other agreement
of understanding with respect to any transfer of any or all of such Shares or
any interest therein, (iii) grant any proxy, power-of-attorney or other
authorization in or with respect to such Shares, (iv) deposit such Shares into a
voting trust or enter into a voting agreement or arrangement with respect to
such Shares or (v) take any other action that would in any way restrict, limit
or interfere with the performance of its obligations hereunder or the
transactions contemplated hereby.
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<PAGE> 3
(b) Subject to Section 8, Stockholder shall not, nor shall it
permit any investment banker, attorney or other adviser or representative of
Stockholder to, directly or indirectly, (i) solicit, initiate or encourage the
submission of, any takeover proposal or (ii) participate in any discussions or
negotiations regarding, or furnish to any person any information with respect
to, or take any other action to facilitate any inquiries or the making of any
proposal that constitutes, or may reasonably be expected to lead to, any
takeover proposal. Without limiting the foregoing, it is understood that any
violation of the restrictions set forth in the preceding sentence by an
investment banker, attorney or other adviser or representative of Stockholder,
whether or not such person is purporting to act on behalf of such Stockholder or
otherwise, shall be deemed to be a violation of this Section 3(b) by
Stockholder.
(c) Stockholder shall not take any action which would
restrict, limit or frustrate in any way the transactions contemplated by this
Agreement.
(d) Subject to Section 7 hereof, at any meeting of the
Company's Stockholders or at any adjournment thereof or in any other
circumstances upon which their vote, consent or other approval is sought,
Stockholder shall vote (or cause to be voted) Stockholder's Shares against (i)
any merger agreement or merger (other than the Merger Agreement and the Merger),
consolidation, combination, sale of substantial assets, reorganization, joint
venture, recapitalization, dissolution, liquidation or winding up of or by the
Company and (ii) any amendment of the Company's Certificate of Incorporation or
By-laws or other proposal or transaction involving the Company or any of its
subsidiaries which amendment or other proposal or transaction would in any
manner impede, frustrate, prevent or nullify, or result in a breach of any
covenant, representation or warranty or any other obligation or agreement of the
Company under or with respect to, the Offer, the Merger, the Merger Agreement or
any of the other transactions contemplated by the Merger Agreement (each of the
foregoing in clause (i) or (ii) above, a "Competing Transaction").
SECTION 4. Grant of Irrevocable Proxy: Appointment of Proxy.
(a) Stockholder hereby irrevocably grants to, and appoints,
Harold W. Pote and Robert F. Semmens, in their respective capacities as officers
of Parent, and any individual who shall hereafter succeed to any such office of
Parent, and each of them individually, Stockholder's proxy and attorney-in-fact
(with full power of substitution), for and in the name, place and stead of
Stockholder, to vote Stockholder's Shares, or grant a consent or approval in
respect of Shares against any Competing Transaction.
(b) Stockholder represents that any proxies heretofore given
in respect of Stockholder's Shares are not irrevocable, and that any such
proxies are hereby revoked.
(c) Stockholder hereby affirms that the irrevocable proxy set
forth in this Section 4 is given in connection with the execution of the Merger
Agreement, and that such irrevocable proxy is given to secure the performance of
the duties of Stockholder under this Agreement. Stockholder hereby further
affirms that the irrevocable proxy is coupled with an interest and may
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<PAGE> 4
under no circumstances be revoked. Such Stockholder hereby ratifies and confirms
all that such irrevocable proxy may lawfully do or cause to be done by virtue
hereof. Such irrevocable proxy is executed and intended to be irrevocable in
accordance with the provision of Section 212(e) of the Delaware General
Corporation Law (the "DGCL").
SECTION 5. Certain Events.
Stockholder agrees that this Agreement and the obligations hereunder
shall attach to Stockholder's Shares and shall be binding upon any person or
entity to which legal or beneficial ownership of such Shares shall pass, whether
by operation of law or otherwise, including without limitation Stockholder's
heirs, guardians, administrators or successors. In the event of any stock split,
stock dividend, merger, reorganization, recapitalization or other change in the
capital structure of the Company affecting the Company Common Stock, or the
acquisition of additional shares of Company Common Stock or other voting
securities of the Company by Stockholder, this Agreement and the obligations
hereunder shall attach to any additional shares of Company Common Stock or other
voting securities of the Company issued to or acquired by Stockholder.
SECTION 6. Legend.
Stockholder agrees that Stockholder will deliver to the Company, within
5 business days after the date hereof, any and all certificates representing
Stockholder's Shares in order that the Company may inscribe upon such
certificates the following legend: "The shares of Common Stock, $.01 par value,
of AMBAR, Inc. represented by this certificate are subject to a Stockholder
Agreement dated as of July 1, 1996, and may not be sold or otherwise
transferred, except in accordance therewith. Copies of such Agreement may be
obtained at the principal executive offices of AMBAR, Inc."
SECTION 7. Voidability.
If prior to the execution hereof, the Board of Directors of the Company
shall not have duly and validly authorized and approved by all necessary
corporate action, this Agreement, the Merger Agreement and the transactions
contemplated hereby and thereby, or if, subsequent to any such approval or
authorization, the Board of Directors withdraws any such authorization and
approval so that by the execution and delivery hereof Parent or Purchaser would
become, or could reasonably be expected to become an "interested stockholder"
with whom the Company would be prevented for any period pursuant to Section 203
of the DGCL or the Certificate Incorporation of the Company from engaging in any
"business combination" (as such terms are defined in Section 203 of the DGCL)
then this Agreement shall be void and unenforceable until such time as such
authorization and approval shall have been duly and validly obtained.
4
<PAGE> 5
SECTION 8. Stockholder Capacity.
By executing this Agreement Stockholder makes no agreement or
understanding herein in his capacity as a director and officer of the Company.
Stockholder signs solely in his capacity as the record holder and beneficial
owner of Stockholder's Shares and nothing herein shall limit or affect any
actions taken by Stockholder in his capacity as an officer or director of the
Company to the extent specifically permitted by the Merger Agreement. No action
taken by Stockholder solely in his capacity as an officer or director of the
Company shall be deemed to be a breach of this
Agreement; provided, however, that no such action by Stockholder shall excuse
Stockholder from his obligations under Section 2 of this Agreement.
SECTION 9. Further Assurances.
Stockholder shall, upon request of Parent, execute and deliver any
additional documents and take such further actions as may reasonably be deemed
by Parent to be necessary or desirable to carry out the provisions hereof and to
vest the power to vote Stockholder's Shares as contemplated by Section 4 in
Parent and the other irrevocable proxies described therein.
SECTION 10. Termination.
This Agreement, and all rights and obligations of the parties
hereunder, shall terminate upon the first to occur of (i) the Effective Time of
the Merger or (ii) the termination of the Merger Agreement pursuant to Section
8.1, other than Section 8.1(j), thereof.
SECTION 11. Miscellaneous.
(a) Capitalized terms used and not otherwise defined in this
Agreement shall have the respective meanings assigned such terms in the Merger
Agreement.
(b) All notices, requests, claims, demands and other
communications under this Agreement shall be in writing and shall be deemed
given if delivered personally or sent by overnight courier (providing proof of
delivery) to the parties at the following addresses (or at such other address
for a party as shall be specified by like notice): (i) if to Parent, to the
address set forth in Section 9.5 of the Merger Agreement; and (ii) if to
Stockholder, to Kenneth J. Boutte, c/o AMBAR, Inc., The AMBAR Building, 221 Rue
de Jean, Suite 300, Lafayette, LA 70508, or such other address as may be
specified in writing by Stockholder.
(c) The headings contained in this Agreement are for reference
purposes only and shall not affect in any way the meaning or interpretation of
this Agreement.
(d) This Agreement may be executed in counterparts, each of
which shall be considered one and the same agreement and shall become effective
as to any Stockholder when one
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<PAGE> 6
or more counterparts have been signed by each of Parent and Stockholder and
delivered to Parent and Stockholder.
(e) This Agreement (including the documents and instruments
referred to herein) constitutes the entire agreement, and supersedes all prior
agreements and understandings, both written and oral, among the parties with
respect to the subject matter hereof.
(f) This Agreement shall be governed by, and construed in
accordance with, the laws of the State of Delaware, regardless of the laws that
might otherwise govern under applicable principles of conflicts of laws thereof.
(g) Neither this Agreement nor any of the rights, interests or
obligations under this Agreement shall be assigned, in whole or in part, by
operation of law or otherwise, by any of the parties without the prior written
consent of the other parties, except by laws of descent, provided that Parent
may assign any of its rights and obligations to any affiliate (as defined in
Rule 12b-2 under the Exchange Act) of Parent if such affiliate expressly assumes
in writing the obligations of Parent under this Agreement, but no such
assignment shall relieve Parent of its obligations hereunder.
(h) If any term, provision, covenant or restriction herein, or
the application thereof to any circumstance, shall, to any extent, be held by a
court of competent jurisdiction to be invalid, void or unenforceable, the
remainder of the terms, provisions, covenants and restrictions herein and the
application thereof to any other circumstances, shall remain in full force and
effect, shall not in any way be affected, impaired or invalidated, and shall be
enforced to the fullest extent permitted by law.
(i) Stockholder agrees that irreparable damage would occur and
that Parent would not have any adequate remedy at law in the event that any of
the provisions of this Agreement were not performed in accordance with their
specific terms or were otherwise breached. It is accordingly agreed that Parent
shall be entitled to an injunction or injunctions to prevent breaches by any
Stockholder of this Agreement and to enforce specifically the terms and
provisions of this Agreement in any court of the United States located in the
State of Delaware or in Delaware state court, this being in addition to any
other remedy to which they are entitled at law or in equity. In addition, each
of the parties hereto (i) consents to submit such party 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 such party 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 such party will not
bring any action relating to this Agreement of any of the transactions
contemplated hereby in any court other than a Federal court sitting in the State
of Delaware or a Delaware state court.
(j) No amendment, modification or waiver in respect of this
Agreement shall be effective against any party unless it shall be in writing and
signed by such party.
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IN WITNESS WHEREOF, each of the parties has caused this Agreement to be
executed on its behalf by its officers thereunto duly authorized, all at or on
the day and year first above written.
Attest: /s/ Stacey W. Goff /s/ Kenneth J. Boutte
------------------------------ --------------------------------------
Name: STACEY W. GOFF KENNETH J. BOUTTE
Title:
AI PARTNERS L.P.
By AI-GP L.L.C., general partner
By Energy Fund GP, Inc., member
Attest: /s/ Stacey W. Goff By /s/ Robert F. Semmens
------------------------------ ---------------------------------
Name: STACEY W. GOFF Name: ROBERT F. SEMMENS
Title: Title: Managing Director
7
<PAGE> 1
Exhibit (c)(4)
EMPLOYMENT AGREEMENT
THIS AGREEMENT made this 1st day of July, 1996, between AMBAR, Inc., a
Delaware corporation (the "Company"), and Randolph M. Moity, Sr. ("Executive").
W I T N E S S E T H:
WHEREAS, Executive is the Chairman, Chief Executive Officer and
President of AMBAR, Inc., a Delaware corporation (the "Company"); and
WHEREAS, AI Partners L.P., a Delaware limited partnership
("Purchaser"), AI Acquisitions Corp., a Delaware corporation, and the Company
have entered into an Agreement and Plan of Merger dated the date hereof (the
"Merger Agreement") and Executive is selling his shares of Common Stock of the
Company (the "Shares") pursuant to a tender offer made in accordance with the
Merger Agreement (the "Tender Offer") and the terms of the Stockholder
Agreement, dated July 1, 1996, between the Executive and Purchaser; and
WHEREAS, after the sale of his Shares, Executive will continue his
position as Chairman, Chief Executive Officer and President of the Company,
including as the surviving corporation following the merger pursuant to the
Merger Agreement, until such time as a suitable replacement may be found and
thereafter will resign his position as Chairman, Chief Executive Officer and
President at the request of the Company; and
WHEREAS, the Company is aware of the special knowledge and expertise
Executive possesses applicable to the management of the Company; and
<PAGE> 2
WHEREAS, it is the Company's desire to retain the services of Executive
and to continue to have the benefit of Executive's expertise and knowledge after
the Transition Period (as defined below), as herein agreed.
NOW, THEREFORE, in consideration of the premises and mutual covenants
contained herein and for other good and valuable consideration, the parties
agree as follows:
SECTION 1. Positions and Duties. (a) Between the date Executive's Shares are
purchased in accordance with the Stockholder Agreement (the "Employment
Commencement Date") and the date on which the Board of Directors of the Company
(the "Board") gives Executive written notice that his tenure as Chairman, Chief
Executive Officer and President of the Company has been terminated (the
"Transition Period"), the Executive shall serve as Chairman, Chief Executive
Officer and President of the Company and be employed at its principal executive
office in Lafayette, Louisiana. In such capacity, Executive shall perform such
duties and have such responsibilities of an executive nature as are customarily
performed by a person holding such office, as well as such additional executive
duties and services as from time to time may be reasonably decided upon by the
Board. Executive shall devote his full productive time, energy and ability to
the proper and efficient conduct of the Company's business. Executive shall
observe and comply with all lawful and reasonable rules of conduct set by the
Board for executives of the Company, and shall endeavor to promote the business,
reputation and interests of the Company.
(b) After the Transition Period and during the remaining term
of this Agreement, Executive agrees to:
(i) maintain good will between the Company and other entities
with which it does business; and
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(ii) be available upon request of the Company from time to
time for consultation with the Company's officers, professional consultants and
other representatives with respect to the management and operations of the
Company at reasonable times upon reasonable notice; and
(iii) use his knowledge and expertise in the furtherance of
the Company's operations upon reasonable request of the Company from time to
time; and
(iv) upon request of the Company, serve as a member of the
Board.
SECTION 2. Compensation. In consideration of the aforesaid services to be
rendered by Executive, the Company agrees to pay to Executive an annual bonus of
up to $300,000 (subject to performance of Executive's duties hereunder to the
reasonable satisfaction of the Board), less amounts for applicable Federal and
Louisiana withholding and other taxes commencing on the Employment Commencement
Date. Such bonus or an annualized portion thereof shall be paid at the end of
each calendar year during and at the end of the term of this Agreement, no later
than 45 days after the end of such year or term. As additional inducement to
secure Executive's services pursuant to this Agreement, the Company agrees that
if Executive should die during the term of this Agreement, the Company will pay
the balance of the compensation Executive would have received over such term to
Executive's estate on the same monthly basis as herein prescribed.
SECTION 3. Termination of Prior Agreement. Effective on the Employment
Commencement Date, the employment agreement currently in effect between
Executive and the Company dated October, 1994 (the "Prior Agreement") is
terminated and shall thereafter be of no force or effect. In addition,
notwithstanding the terms of the Prior Agreement, effective on the Employment
Commencement Date all of Executive's right to receive for any prior or future
period a percentage of the Company's profits pursuant to that Prior Agreement
shall be immediately terminated and shall thereafter be of no force and effect
and all rights to and claims for any prior unpaid incentive bonus amount
pursuant to such Prior Agreement are waived. There are no other agreements or
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<PAGE> 4
understandings between the Company and Executive that are not disclosed in the
Company's filings and reports under the Securities Exchange Act of 1934.
SECTION 4. Benefits. While employed by the Company, Executive shall be entitled
to participate in or receive benefits on the same basis as other executive
officers of the Company under all of the Company's employee benefit plans and
arrangements for which he is eligible and which are in effect on the date hereof
as set forth on Schedule A hereto. Nothing herein shall require the Company to
maintain any such plans, arrangements or benefits, and the Company may terminate
any such plans, arrangements or benefits at any time without providing
substitute or equivalent benefits.
SECTION 5. Confidential Information. (a) Executive acknowledges that during his
affiliation with the Company as an employee, he will be given access to or
acquire certain confidential and proprietary information relating to the
organization, business, properties, operation and condition of the Company
including, but not limited to, financial, managerial and other corporate
information and records of the Company and its shareholders or partners (the
"Confidential Information"), the use or disclosure of which would cause the
Company substantial loss and damages which could not be readily calculated and
for which no remedy at law would be adequate. Accordingly, Executive agrees that
he will not (directly or indirectly) at any time, whether during or after the
term of this Agreement, (i) knowingly use for any improper personal benefit any
Confidential Information that he may learn or has learned by reason of his
position as an officer and director of the Company or thereafter as an executive
of the Company, or (ii) disclose any such Confidential Information to any person
or entity, except (A) in the performance of his obligations to the Company
hereunder, (B) as required by applicable law, (C) in connection with the
enforcement of his rights under this Agreement or (D) with the prior consent of
the Board. As used herein, Confidential Information also
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includes any information, documents, computer systems, programs or other
material developed by Executive during Executive's affiliation with the Company
to the extent it relates to the Company. Executive agrees that such material
will be the exclusive property of the Company and assigns to the Company all
proprietary rights in such material. Confidential Information does not include
the general skills and experience of Executive or any information that (x) is or
becomes generally known or available publicly other than as a result of a
disclosure by Executive, (y) is or becomes known or available to Executive on a
nonconfidential basis from a source (other than the Company) which, to
Executive's knowledge, is not prohibited from disclosing such information to
Executive by a legal, contractual, fiduciary or other obligation to the Company,
or (z) the Company discloses to others without obtaining an agreement of
confidentiality.
(b) Executive confirms that all Confidential Information is
the exclusive property of the Company. All business records, papers and
documents kept or made by Executive relating to the business of the Company
which comprise Confidential Information shall be and remain the property of the
Company during the term of this Agreement and all times thereafter. Upon the
termination of this Agreement or upon the request of the Company at any time,
Executive shall promptly deliver to the Company, and shall retain no copies of,
any written or electronic materials, records and documents made by Executive or
coming into his possession concerning the business or affairs of the Company,
other than personal notes or correspondence of Executive not containing
Confidential Information.
SECTION 6. Non-Competition. (a) Executive acknowledges that the Company has,
over the course of a number of years, developed certain goodwill, valuable
relationships with its employees and customers, particular methods of doing
business and other proprietary and confidential information,
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<PAGE> 6
all of which, the parties agree should be protected. Executive agrees that,
during the term of this Agreement and for a period of two years after the
termination of this Agreement, or such longer period as may be permitted by
Louisiana Revised Statutes 23:921 as in effect from time to time (the
"Restricted Period"), he shall not, directly or indirectly, for his own account
or for the account of others, as an officer, director, stockholder, owner,
partner, employee, promoter, consultant, manager or otherwise, participate in
the promotion, financing, ownership, operation, or management of, or assist in
or carry on through a proprietorship, corporation, partnership or other form of
business entity or otherwise, any business which competes with the Company or
any of its subsidiaries or affiliates in any of the parishes in the State of
Louisiana (or offshore therefrom) or counties in the states of Texas (or
offshore therefrom) or Michigan in which the Company or any of its subsidiaries
or affiliates is engaged in or is actively planning to engage in as of the date
of such termination, including but not limited to those parishes and counties
listed in Schedule B hereto (collectively, the "Restricted Area").
Nothing in this Section 6(a) shall prohibit Executive from acquiring or
holding any issue of stock or securities of any person that has any securities
registered under Section 12 of the Securities Exchange Act of 1934, as amended,
listed on a national securities exchange or quoted on the automated quotation
system of the National Association of Securities Dealers, Inc., other than
shares of Common Stock of the Company, so long as (i) Executive is not deemed to
be an "affiliate" of such person as such term is used in paragraphs (c) and (d)
of Rule 145 under the Securities Act of 1933, as amended, and (ii) Executive
and/or members of his immediate family or persons under his control do not own
or hold more than 5% of the outstanding voting securities of any such person.
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(b) Executive agrees that during the Restricted Period, Executive shall
not, whether for his own account or for the account of any other person or
entity (excluding the Company), (i) solicit or contact in an effort to do
business with any person who was a customer of the Company or any of its
subsidiaries or affiliates within the Restricted Area during the term of this
Agreement, or any affiliate of any such person, if such solicitation or contact
is in competition with the Company, (ii) solicit or induce any of the Company's
employees to leave their employment with the Company or accept employment with
anyone else or hire any such employees or (iii) interfere in any similar manner
with the business of the Company. Nothing herein shall prohibit or preclude the
Executive from performing any other types of services that are not precluded by
Section 6(a) for any other person.
(c) Executive has carefully read and considered the provisions of this
Section 6 and, having done so, agrees that the restrictions set forth in this
Section 6 (including the Restricted Period, scope of activity to be restrained
and the geographical scope) are fair and reasonable and are reasonably required
for the protection of the interests of the Company, its officers, directors,
employees, creditors, investors and shareholders. Executive understands that the
restrictions contained in this Section 6 may limit his ability to engage in a
business similar to the Company's business, but acknowledges that he will
receive sufficiently high remuneration and other benefits from the Company
hereunder to justify such restrictions.
SECTION 7. Travel. Executive shall not be required to change his place of
residence in order to fulfill his obligations hereunder; provided, however, upon
the reasonable request of the Company, Executive will attend meetings at
locations away from the vicinity of Executive's place of residence, including,
without limitation, in New York City and Manistee, Michigan.
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<PAGE> 8
SECTION 8. Commencement, Notice and Scheduling of Duties. Executive's duties
hereunder shall commence on the date hereof. The Company will provide Executive
with sufficient advance notice as to the duties it desires Executive to perform
after the Transition Period. The scheduling of the performance of such duties
will be mutually agreed to by both parties.
SECTION 9. Expenses. The Company shall reimburse Executive for all reasonable
and documented costs and expenses incurred by Executive in connection with the
performance of his duties hereunder, including costs and expenses incurred to
attend meetings away from the vicinity of Executive's place of residence.
SECTION 10. Indemnification. The Company shall indemnify Executive and hold him
harmless, to the fullest extent permitted by applicable law, from any and
against any loss, cost, expense, liability, damage or claim arising out of, or
suffered or incurred by him by reason of, the performance of his duties under
this Agreement, including, without limitation, reasonable attorney's fees;
provided, however, that Executive shall not be entitled to indemnification to
the extent any such loss, cost, expense, liability, damage or claim is
determined by a court or other trier of fact to arise out of Executive's willful
misconduct or gross negligence.
SECTION 11. Liquidated Damages. In the event that Executive shall default in the
performance of any of his duties set forth in Section 1 hereof, the Company
shall be entitled to collect from Executive as liquidated damages the amount of
$1,800,000. At the Company's election, such liquidated damages shall be payable
by Executive by the delivery to the Company of the Company's or AI Acquisitions
Corp.'s promissory note dated the Employment Commencement Date in the principal
amount of $1,800,000, and Executive hereby acknowledges that if such liquidated
damages become due the Company shall have the right to collect said damages by
an offset of its obligations
8
<PAGE> 9
to Executive under said promissory note. The parties hereto acknowledge that
said liquidated damages shall be the sole and exclusive remedy available to the
Company for Executive's failure to perform his duties set forth in Section 1
hereof, but that the Company may seek any remedy for any breach of any other
provision hereof to which the Company may be entitled under applicable law and
that the Company shall also be entitled to injunctive or other equitable relief,
without limiting any other remedies of the Company hereunder at law or in
equity.
SECTION 12. Personal Service Contract. This Agreement is a personal service
contract, and the rights and interests of Executive may not be sold,
transferred, assigned, pledged or mortgaged, and Executive's rights shall not be
subject to attachment, levy or garnishment by a creditor of Executive.
SECTION 13. Term. The primary term of this Agreement shall be for a period of
eighteen months beginning on the Employment Commencement Date and may be
continued thereafter only if agreed to in writing by both parties.
SECTION 14. Binding Instrument. This Agreement is binding on the Company and
Executive and may be changed only by written instrument signed by the parties.
SECTION 15. Counterparts. This Agreement may be executed by the parties in
counterpart, each of which shall be deemed to be an original but both of which
together shall constitute but one agreement.
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<PAGE> 10
SECTION 16. Governing Law. This Agreement shall be governed by and construed in
accordance with the laws of the State of Delaware without regard to its
conflicts of laws doctrine.
EXECUTED on the date first above written.
AMBAR, Inc.
By: /s/ Barry N. Huntsman
-----------------------------------
Name: Barry N. Huntsman
Title: Treasurer
Randolph M. Moity, Sr.
/s/ Randolph M. Moity, Sr.
--------------------------------------
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SCHEDULE A
Medical, dental and life insurance
Long-term disability insurance
401(k) plan
Automobile
Membership at Oakbourne Country Club and the Petroleum Club
A-1
<PAGE> 12
SCHEDULE B
Louisiana:
St. Mary Parish
Cameron Parish
Lafourche Parish
Terrebonne Parish
Vermillion Parish
Iberia Parish
Lafayette Parish
Plaquemine Parish
Orleans Parish
Texas:
Galveston County
Jim Hog County
Neucas County
Victoria County
Jefferson County
Dallas County
Harris County
Michigan
Manistee County
B-1
<PAGE> 1
EXHIBIT (c)(5)
April 23, 1996
VIA FAX (212) 339-0197
The Beacon Group
375 Park Avenue
17th Floor
New York, NY 10152
ATTENTION: Mr. Robert F. Semmens
Partner
Dear Mr. Semmens:
In connection with your consideration of a possible investment in
AMBAR, Inc. (the "Company"), the Company is prepared to make available to you
certain information concerning the business, financial condition, operations,
assets and liabilities of the Company. As a condition to such information being
furnished to you and your directors, officers, employees, agents or advisors
(including, without limitation, attorneys, accountants, consultants, brokers
and financial advisors) (collectively, "Representatives"), you agree to treat
any information concerning the Company (whether prepared by the Company, its
advisors or otherwise and irrespective of the form of communication) which is
furnished to you or to your Representatives now or in the future by or on
behalf of the Company (herein collectively referred to as the "Evaluation
Material") in accordance with the provisions of this letter agreement, and to
take or abstain from taking certain other actions hereinafter set forth.
The term "Evaluation Material" shall be deemed to include all notes,
analyses, compilations, studies, interpretations or other documents prepared by
you or your Representatives which contain, reflect or are based upon, in whole
or in part, the information furnished to you or your Representatives pursuant
hereto. The term "Evaluation Material" does not include information which (i)
is or becomes generally available to the public other than as a result of a
disclosure by you or your Representatives, (ii) was within your possession
prior to its being furnished to you by or on behalf of the Company pursuant
hereto, provided that the source of such information was not known by you to be
bound by a confidentiality agreement with or other contractual, legal or
fiduciary obligation of confidentiality to the Company or any other party with
respect to such information or (iii) becomes available to you on a
non-confidential basis from a source other than the Company or any of its
Representatives, provided that such source is not bound by a confidentiality
agreement with or other contractual, legal or fiduciary obligation of
confidentiality to the Company or any other party with respect to such
information.
You hereby agree that you and your Representatives shall use the
Evaluation Material solely for the purpose of evaluating a possible transaction
between the Company and you, that the Evaluation Material will be kept
confidential and that you and your Representatives will not disclose any of the
Evaluation Material in any manner whatsoever; provided, however, that (i) you
may make any disclosure of such information to which the Company gives its
prior written
<PAGE> 2
The Beacon Group
April 23, 1996
Page 2
consent and (ii) any of such information may be disclosed to your
Representatives who need to know such information for the sole purpose of
evaluating a possible transaction with the Company, who agree to keep such
information confidential and who are provided with a copy of this letter
agreement and agree to be bound by the terms hereof to the same extent as if
they were parties hereto. In any event, you shall be responsible for any breach
of this letter agreement by any of your Representatives and you agree, at your
sole expense, to take all reasonable measures (including but not limited to
court proceedings) to restrain your Representatives from prohibited or
unauthorized disclosure or use of the Evaluation Material.
In addition, you agree that, without the prior written consent of the
Company, you and your Representatives will not disclose to any other person the
fact that the Evaluation Material has been made available to you, that
discussions or negotiations are taking place concerning a possible transaction
involving the Company or any of the terms, conditions or other facts with
respect thereto (including the status thereof), unless in the written opinion of
your counsel such disclosure is required by law and then only with as much prior
written notice to the Company as is practical under the circumstances. Without
limiting the generality of the foregoing, you further agree that, without the
prior written consent of the Company, you will not, directly or indirectly,
enter into any agreement, arrangement or understanding, or any discussions which
might lead to such agreement, arrangement or understanding, with any person
regarding a possible transaction involving the Company, other than the
transactions stipulated in the Schedule 1. The term "person" as used in this
letter agreement shall be broadly interpreted to include the media and any
corporation, partnership, group, individual or other entity.
In the event that you or any of your Representatives are requested or
required (by oral questions, interrogatories, requests for information or
documents in legal proceedings, subpoena, civil investigative demand or other
similar process) to disclose any of the Evaluation Material, you shall provide
the Company with prompt written notice of any such request or requirement so
that the Company may seek a protective order or other appropriate remedy and/or
waive compliance with the provisions of this letter agreement. If, in the
absence of a protective order or other remedy or the receipt of a waiver by the
Company, you or any of your Representatives are nonetheless, in the written
opinion of your counsel, legally compelled to disclose Evaluation Material to
any tribunal or else stand liable for contempt or suffer other censure or
penalty, you or your Representative may, without liability hereunder, disclose
to such tribunal only that portion of the Evaluation Material which such counsel
advises you is legally required to be disclosed, provided that you exercise your
best efforts to preserve the confidentiality of the Evaluation Material,
including, without limitation, by cooperating with the Company to obtain an
appropriate protective order or other reliable assurance that confidential
treatment will be accorded the Evaluation Material by such tribunal.
If you decide that you do not wish to proceed with a transaction with
the Company, you will promptly inform the Company of that decision (the
"Termination Notice"). In that case, or at any time upon the request of the
Company for any reason, you will promptly deliver to the Company all documents
(and all copies thereof) furnished to you or your Representatives by or on
behalf of Company pursuant hereto. In the event of such a decision or request,
all other Evaluation Material prepared by you or your Representatives shall be
destroyed and no copy
<PAGE> 3
The Beacon Group
April 23, 1996
Page 3
thereof shall be retained. Notwithstanding the return or destruction of the
Evaluation Material, you and your Representatives will continue to be bound by
your obligations of confidentiality and other obligations hereunder for a
period of one year from the date of the Termination Notice.
You understand and acknowledge that neither the Company nor any of its
Representatives make any representation or warranty, express or implied, as to
the accuracy or completeness of the Evaluation Material. You agree that neither
the Company nor any of its Representatives shall have any liability to you or
to any of your Representatives relating to or resulting from the use of the
Evaluation Material. Only those representations or warranties which are made in
a final definitive agreement regarding the transactions contemplated hereby,
when, as and if executed, and subject to such limitations and restrictions as
may be specified therein, will have any legal effect.
You agree that, until the execution of a final definitive agreement
regarding a transaction between us, you will not initiate or maintain contact
with any officer, director, employee, distributor, supplier or customer of the
Company regarding its business operations, prospects or finances, except with
the express written permission of the Company or except as provided herein. It
is understood that the Company will arrange for appropriate contacts for due
diligence purposes. Unless otherwise agreed to by the Company, all (i)
communications regarding a possible transaction, (ii) requests for additional
information, (iii) requests for facility tours or management meetings, and (iv)
discussions or questions regarding procedures, will be submitted or directed to
the Company.
In consideration of the Evaluation Material being furnished to you, you
hereby further agree that, without the prior written consent of the Board of
Directors of the Company, for a period of two years from the date hereof,
neither you nor any of your affiliates (as such term is defined in Rule 12b-2
of the Securities Exchange Act of 1934, as amended), acting alone or as part of
a group, will acquire or offer or agree to acquire, directly or indirectly, by
purchase or otherwise, any voting securities (or direct or indirect rights or
options to acquire any voting securities) of the Company, or otherwise seek to
influence or control, in any manner whatsoever, the management or policies of
the Company.
You agree that unless and until a final definitive agreement regarding
a transaction between the Company and you has been executed and delivered,
neither the Company nor you will be under any legal obligation of any kind
whatsoever with respect to such a transaction by virtue of this letter
agreement except for the matters specifically agreed to herein. You further
acknowledge and agree that the Company reserves the right, in its sole
discretion, to reject any and all proposals made by you or any of your
Representatives with regard to a transaction between the Company and you, and
to terminate discussions and negotiations with you at any time.
It is understood and agreed that no failure or delay by the Company in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof, nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or privilege
hereunder.
<PAGE> 4
The Beacon Group
April 23, 1996
Page 4
It is further understood and agreed that money damages would not be a
sufficient remedy for any breach of this letter agreement by you or any of your
Representatives and that the Company shall be entitled to equitable relief,
including injunction and specific performance, as a remedy for any such breach.
Such remedies shall not be deemed to be the exclusive remedies for a breach by
you of this letter agreement but shall be in addition to all other remedies
available at law or equity to the Company. In the event of litigation relating
to this letter agreement, if a court of competent jurisdiction determines that
you or any of your Representatives have breached this letter agreement, then
you shall be liable and pay to the Company the reasonable legal fees incurred
by the Company in connection with such litigation, including any appeal
therefrom.
This letter agreement shall be governed by and construed in accordance
with the laws of the State of Louisiana.
Please confirm your agreement with the foregoing by signing and
returning one copy of this letter to the undersigned, whereupon this letter
agreement shall become a binding agreement between you and the Company.
Very truly yours,
AMBAR, Inc.
By: /s/ Randolph M. Moity
-------------------------------
Randolph M. Moity
Accepted and agreed as of
the date first written above:
The Beacon Group
By: /s/ Robert F. Semmens
------------------------
Name: Robert F. Semmens
Title: Partner
