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Exhibit (a)(1)(A)
Offer to
Purchase for Cash
All Outstanding Shares of
Common Stock
of
International Coal Group,
Inc.
at
$14.60 Net Per Share
by
Atlas Acquisition
Corp.
a wholly owned subsidiary
of
Arch Coal, Inc.
THE OFFER AND WITHDRAWAL RIGHTS
EXPIRE AT 8:00 A.M., NEW YORK CITY TIME, ON TUESDAY, JUNE
14, 2011, UNLESS THE OFFER IS EXTENDED.
THIS OFFER IS BEING MADE PURSUANT TO THE AGREEMENT AND PLAN OF
MERGER (THE “MERGER AGREEMENT”) DATED AS OF MAY
2, 2011 BY AND AMONG ARCH COAL, INC. (“ARCH”),
ATLAS ACQUISITION CORP. (“MERGER SUB”) AND
INTERNATIONAL COAL GROUP, INC. (“ICG”).
THE BOARD OF DIRECTORS OF ICG HAS UNANIMOUSLY
(I) DETERMINED THAT THE OFFER AND THE MERGER REFERRED TO
HEREIN ARE FAIR TO AND IN THE BEST INTERESTS OF ICG AND ITS
STOCKHOLDERS AND (II) ADOPTED RESOLUTIONS APPROVING AND
DECLARING THE ADVISABILITY OF THE MERGER AGREEMENT AND THE
TRANSACTIONS CONTEMPLATED BY THE MERGER AGREEMENT, INCLUDING THE
OFFER AND THE MERGER. THE ICG BOARD OF DIRECTORS UNANIMOUSLY
RECOMMENDS THAT ICG’S STOCKHOLDERS ACCEPT THE OFFER AND
TENDER THEIR SHARES IN THE OFFER AND (IF REQUIRED UNDER
DELAWARE LAW) ADOPT THE MERGER AGREEMENT.
THERE IS NO FINANCING CONDITION TO THE MERGER. THE OFFER IS
SUBJECT TO VARIOUS CONDITIONS, INCLUDING (I) THERE BEING
VALIDLY TENDERED AND NOT PROPERLY WITHDRAWN PRIOR TO THE
EXPIRATION OF THE OFFER A NUMBER OF SHARES THAT, TOGETHER
WITH THE NUMBER OF SHARES (IF ANY) THEN BENEFICIALLY OWNED BY
ARCH AND/OR MERGER SUB, REPRESENTS AT LEAST A MAJORITY OF THE
TOTAL NUMBER OF ICG SHARES OUTSTANDING ON A FULLY DILUTED
BASIS AND (II) THE EXPIRATION OF THE APPLICABLE WAITING
PERIOD UNDER THE
HART-SCOTT-RODINO
ANTITRUST IMPROVEMENTS ACT OF 1976, AS AMENDED, AND
(III) OTHER CUSTOMARY CONDITIONS. A SUMMARY OF THE
PRINCIPAL TERMS OF THE OFFER APPEARS ON PAGES (1) THROUGH (7).
YOU SHOULD READ THIS ENTIRE DOCUMENT CAREFULLY BEFORE DECIDING
WHETHER TO TENDER YOUR SHARES.
The Dealer Manager for the Offer is:
May 16, 2011
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IMPORTANT
If you desire to tender all or any portion of your shares of ICG
common stock in the Offer (as defined herein), this is what you
must do:
| • | if you are a record holder (i.e., a stock certificate has been issued to you), you must complete and sign the enclosed Letter of Transmittal and send it with your stock certificate to Computershare Trust Company, N.A., the depositary for the Offer (the “Depositary”), or follow the procedures for book-entry transfer set forth in Section 3 of this Offer to Purchase. These materials must reach the Depositary before the Offer expires. Detailed instructions are contained in the Letter of Transmittal and in Section 3 — “Procedure for Tendering Shares” of this Offer to Purchase. | |
| • | if you are a record holder but your stock certificate is not available or you cannot deliver it to the Depositary before the Offer expires, you may be able to tender your shares of ICG common stock using the enclosed Notice of Guaranteed Delivery. Please call the information agent, Innisfree M&A Incorporated (the “Information Agent”), at (877) 717-3922 (toll-free for stockholders) or (212) 750-5833 (collect for bank and brokers) for assistance. See Section 3 — “Procedure for Tendering Shares” for further details. | |
| • | if you hold your shares of ICG common stock through a broker, bank, trust company or other nominee, you must contact your broker, bank, trust company or other nominee and give instructions that your ICG shares be tendered. |
* *
*
Questions and requests for assistance may be directed to the
Information Agent at its address and telephone numbers set forth
above and on the back cover of this Offer to Purchase. The
Dealer Manager (as defined herein) may be contacted at its
address and telephone number on the back cover of this Offer to
Purchase. Additional copies of this Offer to Purchase, the
Letter of Transmittal, the Notice of Guaranteed Delivery and
other related materials may be obtained from the Information
Agent or from your broker, dealer, bank, trust company or other
nominee. Copies of these materials may also be found at the
website maintained by the United States Securities and Exchange
Commission at www.sec.gov.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL
CONTAIN IMPORTANT INFORMATION, AND YOU SHOULD CAREFULLY READ
BOTH IN THEIR ENTIRETY BEFORE YOU MAKE A DECISION WITH RESPECT
TO THE OFFER.
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CONTENTS
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SUMMARY
TERM SHEET
This summary term sheet highlights the most material terms of
the Offer to Purchase and may not contain all the information
that is important to you. This summary term sheet is not meant
to be a substitute for the information contained in the
remainder of this Offer to Purchase, and the information
contained in this summary is qualified in its entirety by the
fuller terms, descriptions and explanations contained in this
Offer to Purchase and in the related Letter of Transmittal. We
recommend that you carefully read this entire Offer to Purchase
and the related Letter of Transmittal before making any decision
on whether to tender your Shares (defined below). The
information concerning ICG contained herein and elsewhere in
this Offer to Purchase has been provided to Arch and Merger Sub
by ICG or has been taken from or is based upon publicly
available documents or records of ICG on file with the United
States Securities and Exchange Commission (the “SEC”)
or other public sources at the time of the Offer. Arch and
Merger Sub have not independently verified the accuracy and
completeness of such information. Arch and Merger Sub have no
knowledge that would indicate that any statements contained
herein relating to ICG provided to Arch or Merger Sub or taken
from or based upon such documents and records filed with the SEC
are untrue or incomplete in any material respect. In this Offer
to Purchase, unless the context otherwise requires, the terms
“we,” “our” and “us” refer to
Atlas Acquisition Corp. and, where appropriate, Arch Coal,
Inc.
Principal
Terms
| • | Arch Coal, Inc., a Delaware corporation (“Arch”), through its wholly owned subsidiary, Atlas Acquisition Corp., a Delaware corporation (“Merger Sub”), is offering to purchase all outstanding shares of common stock, par value $0.01 per share (the “Shares”), of International Coal Group, Inc., a Delaware corporation (“ICG”), for $14.60 per share in cash, net to the seller, without interest and less any applicable withholding taxes, upon the terms and subject to the conditions set forth in this Offer to Purchase and the related Letter of Transmittal and pursuant to the Agreement and Plan of Merger, dated as of May 2, 2011, by and among Arch, Merger Sub and ICG (the “Merger Agreement”). | |
| • | The Offer is the first step in our plan to acquire all of the outstanding shares of ICG common stock, as provided in the Merger Agreement. If the Offer is successful (that is, if a majority of the outstanding shares on a fully diluted basis is purchased pursuant to the Offer), we will acquire any and all remaining shares in a subsequent merger for the same price paid in the Offer in cash. | |
| • | The offering period of the Offer will expire at 8:00 a.m., New York City time, on Tuesday, June 14, 2011, unless the Offer is extended. | |
| • | If we extend the Offer, we will issue a press release giving the new expiration date no later than 9:00 a.m., New York City time, on the first business day after the previously scheduled expiration date of the Offer. | |
| • | If it is necessary or desirable to obtain additional shares of ICG common stock in order to effect a short-form merger under Delaware law (which can be effected once we, together with Arch, own at least 90% of the outstanding shares of ICG common stock), we may provide a subsequent offering period of up to 20 business days in accordance with Rule 14d-11 under the Securities Exchange Act of 1934, as amended (the “Exchange Act”). |
ICG Board
of Directors Recommendation
| • | The board of directors of ICG (the “ICG Board”) unanimously (i) determined that the Offer and the Merger (defined below) are fair to and in the best interests of ICG and its stockholders, (ii) adopted resolutions approving and declaring the advisability of the Merger Agreement and the transactions contemplated thereby, including the Offer and the Merger, in accordance with Delaware law and (iii) resolved to recommend that ICG’s stockholders accept the Offer and tender their Shares pursuant to the Offer and, if required, adopt the Merger Agreement. |
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Conditions
The consummation of the Offer is conditioned upon, among other
things:
| • | at least a majority of the outstanding shares of ICG common stock, calculated on a fully diluted basis, having been validly tendered and not withdrawn prior to the expiration of the Offer (as it may be extended from time to time) (the “Minimum Condition”); | |
| • | the expiration or termination of any waiting period in connection with the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and the regulations promulgated thereunder (the “HSR Act” and such condition, the “HSR Condition”); and | |
| • | the other conditions to the Offer described in Section 15 — “Conditions to the Offer.” |
We may waive some of the conditions to the Offer without the
consent of ICG. We cannot, however, waive the Minimum Condition
without the consent of ICG. See also Section 16 —
“Certain Legal Matters; Regulatory Approvals.”
Consummation of the Offer is not conditioned on Arch or Merger
Sub obtaining financing.
Procedures
for Tendering
If you wish to accept the Offer, this is what you must do:
| • | if you are a record holder (i.e., a stock certificate has been issued to you), you must complete and sign the enclosed Letter of Transmittal and send it with your stock certificate to Computershare Trust Company, N.A., the depositary for the Offer (the “Depositary”), or follow the procedures for book-entry transfer set forth in Section 3 of this Offer to Purchase. These materials must reach the Depositary before the Offer expires. Detailed instructions are contained in the Letter of Transmittal and in Section 3 — “Procedure for Tendering Shares.” | |
| • | if you are a record holder but your stock certificate is not available or you cannot deliver it to the Depositary before the Offer expires, you may be able to tender your shares of ICG common stock using the enclosed Notice of Guaranteed Delivery. Please call the information agent, Innisfree M&A Incorporated (the “Information Agent”), at (877) 717-3922 (toll-free for stockholders) or (212) 750-5833 (collect for banks and brokers) for assistance. See Section 3 — “Procedure for Tendering Shares” for further details. | |
| • | if you hold your shares of ICG common stock through a broker, bank, trust company or other nominee, you must contact your broker, bank, trust company or other nominee and give instructions that your shares of ICG common stock be tendered. |
Withdrawal
Rights
| • | To withdraw Shares that you have tendered pursuant to the Offer, you must deliver a written notice of withdrawal, or a facsimile of one, with the required information to the Depositary, while you have the right to withdraw the Shares. If you tendered Shares by giving instructions to a broker, bank, trust company or other nominee, you must instruct the broker, bank, trust company or other nominee to arrange to withdraw the Shares. See Section 4 — “Withdrawal Rights.” |
Recent
ICG Trading Prices
| • | The closing price for the Shares was: |
$8.38 per Share on February 4, 2011, immediately prior to
the time at which market speculation became apparent regarding a
potential sale of ICG;
$11.03 per Share on April 29, 2011, the last trading day
before we announced that we had entered into the Merger
Agreement; and
$14.45 per Share on May 13, 2011, the last trading day
before the printing of these materials.
| • | Before deciding whether to tender, you should obtain a current market quotation for the Shares. |
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Further
Information
If you have questions about the Offer, you can call our
Information Agent:
Stockholders may call toll free
(877) 717-3922.
Banks and brokers may call collect
(212) 750-5833.
FREQUENTLY
ASKED QUESTIONS
Who is
offering to buy my securities?
The Offer is made by Atlas Acquisition Corp., a Delaware
corporation formed for the purpose of making this tender offer
for all of the outstanding common stock of ICG. We are a wholly
owned subsidiary of Arch Coal, Inc., a Delaware corporation. See
the “Introduction” to this Offer to Purchase and
Section 9 — “Certain Information Concerning
Arch and Merger Sub.”
What
securities are you offering to purchase?
We are offering to purchase all of the outstanding common stock,
par value $0.01 per share, of ICG on the terms and subject to
the conditions set forth in this Offer to Purchase and the
related Letter of Transmittal. Unless the context otherwise
requires, in this Offer to Purchase, we use the term
“Offer” to refer to this offer and the term
“Shares” to refer to the shares of ICG common
stock that are the subject of the Offer.
See the “Introduction” to this Offer to Purchase and
Section 1 — “Terms of the Offer.”
How much
are you offering to pay for my Shares? What is the form of
payment? Will I have to pay any fees or commissions?
We are offering to pay you $14.60 per share in cash, without
interest, less any required withholding taxes. If you are the
record holder of your Shares (i.e., a stock certificate has been
issued to you) and you directly tender your Shares in the Offer,
you will not have to pay brokerage fees or similar expenses. If
you own your Shares through a broker, bank, trust company or
other nominee, and your nominee tenders your Shares on your
behalf, your broker, bank, trust company or other nominee may
charge you a fee for doing so. You should consult your broker,
bank, trust company or other nominee to determine whether any
charges will apply. See the “Introduction” to this
Offer to Purchase.
Do you
have the financial resources to make payment?
Yes. Consummation of the Offer is not subject to any financing
condition. Arch will provide us with sufficient funds to pay for
all Shares accepted for payment in the Offer. We estimate that
the total amount of funds necessary to purchase all of the
Shares pursuant to the Offer and to consummate the other
transactions contemplated by the Merger Agreement, including
making payments in respect of outstanding ICG compensatory
awards, paying the merger consideration in connection with the
merger of us with and into ICG (the “Merger”),
which is expected to follow the successful completion of the
Offer, the redemption or other repayment of certain outstanding
indebtedness of ICG and paying related fees and expenses will be
approximately $3.8 billion. The majority of the
approximately $3.8 billion is expected to come from the
issuance of unsecured senior notes by Arch (the
“Notes”), either by private placement or an
underwritten public sale, with the balance to be paid using the
proceeds of additional common shares to be issued by Arch (the
“Arch Shares”) or other additional senior
secured indebtedness (the “Loans”) to be raised
by Arch. To the extent that Arch is unable issue the Notes,
Shares and Loans for the entire $3.8 billion amount
necessary to finance the transaction described in the previous
sentence, Arch has a commitment from Morgan Stanley
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Senior Funding, Inc. and PNC Bank, National Association, to
provide, or cause their respective affiliates to provide,
$3.8 billion of senior unsecured bridge loans to Arch,
which may be used to finance such transactions. See
Section 10 — “Source and Amount of
Funds.”
Is your
financial condition relevant to my decision to tender in the
offer?
No. We do not think our financial condition is relevant to
your decision whether to tender Shares and accept the Offer
because:
| • | the Offer is being made for all outstanding shares of ICG common stock solely for cash; | |
| • | as described above, we, through our parent company, Arch, will have sufficient funds to purchase all Shares validly tendered, and not withdrawn, in the Offer and to provide funding for the Merger, which is expected to follow the successful completion of the Offer, and the other related transactions; | |
| • | the consummation of the Offer is not subject to any financing condition; and | |
| • | if we consummate the Offer, we expect to acquire any remaining Shares for the same cash per share price in a subsequent offering period or in the Merger. |
See Section 10 — “Source and Amount of
Funds.”
Is there
an agreement governing the Offer?
Yes. ICG, Arch and Merger Sub have entered into the Merger
Agreement. The Merger Agreement provides, among other things,
for the terms of and conditions to the Offer and, following
consummation of the Offer, the merger of Merger Sub into ICG.
See the “Introduction” to this Offer to Purchase and
Section 13 — “The Transaction
Documents — The Merger Agreement.”
When and
how will I be paid for my tendered Shares?
Subject to the terms and conditions of the Offer, we will pay
for all validly tendered and not properly withdrawn shares of
ICG common stock promptly after the later of the date of
expiration of the Offer and the satisfaction or waiver of the
conditions to the Offer set forth in Section 15 —
“Conditions to the Offer.” We can waive some of the
conditions to the Offer without the consent of ICG; however, we
cannot waive the Minimum Condition without ICG’s consent.
We will pay for your validly tendered and not withdrawn Shares
by depositing the purchase price with the Depositary, which will
act as your agent for the purpose of receiving payments from us
and transmitting such payments to you. In all cases, payment for
tendered shares of ICG common stock will be made only after
timely receipt by the Depositary of certificates for such Shares
(or of a confirmation of a book-entry transfer of such shares as
described in Section 3 — “Procedure for
Tendering Shares”), a properly completed and duly executed
Letter of Transmittal (or facsimile thereof) and any other
required documents for such Shares.
Have any
ICG stockholders agreed to tender their Shares?
Yes. Certain affiliates of WL Ross & Co. LLC, who
collectively own approximately 6% of the outstanding stock of
ICG, and certain affiliates of Fairfax Financial Holdings
Limited, who collectively own approximately 11% of the
outstanding stock of ICG, have each entered into a tender and
voting agreement with us and Arch, pursuant to which they have
agreed to, among other things, tender their shares of ICG’s
common stock into the Offer and vote their shares of ICG’s
common stock in favor of adopting the Merger Agreement, if
applicable. The stockholders party to the tender and voting
agreements have agreed to comply with certain restrictions on
the disposition of their Shares and to not withdraw them from
the Offer, subject to the terms and conditions contained therein.
See Section 13 — “The Transaction
Documents — Other Agreements — Tender and
Voting Agreements.”
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How long
do I have to decide whether to tender in the Offer?
You have until at least 8:00 a.m., New York City time, on
Tuesday, June 14, 2011, to decide whether to tender your
Shares in the Offer. See Section 1 — “Terms
of the Offer.” If you cannot deliver everything required to
make a valid tender to the Depositary for the Offer prior to
such time, you may be able to use a guaranteed delivery
procedure, which is described in Section 3 —
“Procedure for Tendering Shares.” In addition, if we
extend the Offer or provide a subsequent offering period in the
Offer as described below under “Introduction” to this
Offer to Purchase, you will have an additional opportunity to
tender your Shares. Please be aware that if your Shares are held
by a broker, bank, trust company or other nominee, they may
require advance notification before the expiration date of the
Offer.
Can the
Offer be extended and under what circumstances?
Yes. We have agreed in the Merger Agreement that:
| • | if at the scheduled expiration date of the Offer, including following a prior extension, any condition to the Offer (as set forth in Section 15 — “Conditions to the Offer”) has not been satisfied or waived, we will extend the Offer for periods of up to five business days (or such longer period as the parties may agree) per extension until all of the conditions to the Offer are satisfied or waived; | |
| • | we will extend the Offer for any period required by any applicable law or any rule, regulation, interpretation or position of the SEC (or its staff) or the New York Stock Exchange (the “NYSE”); and | |
| • | if the marketing period for the financing of the Offer (as set forth in Section 15 — “Conditions to the Offer”) has not ended on the last business day prior to the scheduled expiration date of the Offer, including following a prior extension, we will extend the Offer until the earlier of (i) the first business day after the final day of the marketing period and (ii) any business day before or during the marketing period as may be specified by Arch on no less than two business days’ prior notice to ICG. |
However, we do not have any obligation to extend the offer
beyond the date that is 20 business days after the date that all
of the conditions to the Offer have been satisfied other than
the Minimum Condition. We will also not be required to extend
the Offer beyond August 2, 2011, or, if the HSR Condition
has not been satisfied by August 2, 2011, then this date
will automatically be extended to November 2, 2011 (as such
date may be extended, the “Outside Date”). See
Section 1 — “Terms of the Offer” and
Section 15 — “Conditions to the Offer.”
See Section 13 — “The Transaction
Documents — The Merger Agreement —
Termination” for circumstances in which we may terminate
the Offer.
Will
there be a subsequent offering period?
Following the acceptance for payment of all of the Shares
properly tendered and not withdrawn during the initial offering
period (including any extensions), if it is necessary or
desirable to obtain additional Shares in order to effect a
short-form merger under Delaware law (which can be effected once
we own at least 90% of the outstanding shares of ICG), we may
provide a subsequent offering period (and one or more extensions
thereof) of up to 20 business days, during which time
stockholders whose Shares have not been accepted for payment may
tender, but not withdraw, their Shares and receive the offer
consideration. See Section 1 — “Terms of the
Offer” and Section 4 — “Withdrawal
Rights” for more information concerning any subsequent
offering period.
What is
the difference between an extension of the Offer and a
subsequent offering period?
If the Offer is extended, no Shares will be accepted or paid for
until the extension expires, and you will be able to withdraw
your Shares until then. A subsequent offering period, if there
is one, would occur after we have accepted, and become obligated
to pay for, all of the Shares that were validly tendered and not
withdrawn by the time the initial offering period (including any
extensions) expired. Shares that are validly tendered during a
subsequent offering period will be accepted and paid for as they
are received and cannot be withdrawn. We would expect that,
prior to a subsequent offering period being provided, we would
have
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purchased a sufficient number of Shares in the Offer so as to
ensure that the Merger could be effected. See
Section 1 — “Terms of the Offer” and
Section 4 — “Withdrawal Rights.”
How will
I be notified if the Offer is extended?
If we extend the Offer, we will inform the Depositary of that
fact and will make a public announcement of the extension, no
later than 9:00 a.m., New York City time, on the next
business day after the day on which the Offer was scheduled to
expire.
If we elect to provide a subsequent offering period, a public
announcement of such determination will be made no later than
9:00 a.m., New York City time, on the next business day
following the expiration of the Offer.
Until
what time can I withdraw previously tendered Shares?
You can withdraw some or all of the Shares that you previously
tendered in the Offer at any time prior to the expiration date
of the Offer as it may be extended. Further, if we have not
accepted your Shares for payment by the date that is
60 days from the date of this Offer to Purchase, you may
withdraw them at any time after such date, unless such Shares
have been previously accepted for payment pursuant to the Offer
as provided herein. Once we accept your tendered Shares for
payment upon expiration of the Offer, however, you will no
longer be able to withdraw them. In addition, you may not
withdraw Shares tendered during a subsequent offering period, if
we elect to have such a period. See Section 4 —
“Withdrawal Rights.”
Will the
Offer be followed by a merger if all ICG Shares are not tendered
in the Offer?
If we purchase Shares in the Offer and the other conditions to
the Merger are satisfied or, where permissible, waived, we will
be merged with and into ICG. If we purchase Shares in the Offer
(and the Minimum Condition has not been waived with the consent
of ICG), we will have sufficient voting power to approve the
merger without the affirmative vote of any other stockholder of
ICG. Furthermore, if pursuant to the Offer or otherwise we own
at least 90% of the outstanding Shares, we may effect the Merger
without any further action by the stockholders of ICG. If the
Merger takes place, ICG will become a wholly owned subsidiary of
Arch, and all remaining stockholders (other than ICG, Arch and
Merger Sub, any of their respective subsidiaries and any
stockholders who validly exercise their appraisal rights in
connection with the Merger as described in
Section 12 — “Purpose of the Offer; Plans
for ICG; Appraisal Rights”) will receive the offer price,
$14.60 net per Share in cash, without interest and less any
applicable withholding taxes. See the “Introduction”
to this Offer to Purchase, Section 12 —
“Purpose of the Offer; Plans for ICG; Appraisal
Rights” and Section 13 — “The
Transaction Documents — The Merger Agreement.”
What is
the
“Top-Up
Option” and when could it be exercised?
ICG has granted us an irrevocable option, exercisable only
following our acquisition of Shares pursuant to the Offer, to
purchase from ICG, subject to the terms and conditions set forth
in the Merger Agreement, up to the number of authorized and
unissued shares of ICG common stock equal to the lowest number
of Shares that, when added to the number of Shares owned by Arch
and its subsidiaries (including us) at the time of such
exercise, will constitute one Share more than 90% of the Shares
outstanding on a fully diluted basis, at a price per share equal
to the price per Share paid in the Offer. This option is to
enable us, following our acquisition of Shares pursuant to the
Offer, to effect the Merger as a short-form merger under
Delaware law without a vote or any further action by the
stockholders of ICG. See Section 13 — “The
Transaction Documents — The Merger
Agreement —
Top-Up
Option.”
If I
decide not to tender, how will the Offer affect my
Shares?
If the Merger takes place between ICG and us, ICG’s
stockholders who do not tender their Shares in the Offer (other
than those properly exercising their appraisal rights) will
receive cash in an amount equal to the price per share paid in
the Offer. Therefore, if the Merger takes place, the only
difference between tendering and not tendering your Shares is
that tendering stockholders will be paid earlier. If you decide
not to tender
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your Shares in the Offer and we purchase the Shares which are
tendered in the Offer, but the Merger does not occur, there may
be so few remaining stockholders and publicly traded Shares that
ICG common stock will no longer be eligible to be traded on the
NYSE or other securities exchanges and there may not be an
active public trading market for ICG common stock. Also ICG may
no longer be required to make filings with the SEC or otherwise
may no longer be required to comply with the SEC rules relating
to publicly held companies. See Section 7 —
“Possible Effects of the Offer on the Market for the
Shares; Stock Exchange Listing; Registration under the Exchange
Act; Margin Regulations” and Section 13 —
“The Transaction Documents — The Merger
Agreement.”
Are
appraisal rights available in either the Offer or the
Merger?
No appraisal rights will be available to you in connection with
the Offer. However, you will be entitled to seek appraisal
rights in connection with the Merger if you do not tender Shares
in the Offer and do not vote in favor of (or consent in writing
to) the Merger, subject to and in accordance with Delaware law.
See Section 12 — “Purpose of the Offer;
Plans for ICG; Appraisal Rights — Appraisal
Rights.”
If you
successfully complete the Offer, what will happen to ICG’s
board of directors?
If we accept Shares of ICG common stock for payment pursuant to
the Offer and pay for those Shares, under the Merger Agreement
we will become entitled to elect or designate a number of
directors to the ICG Board, rounded up to the next whole number,
that is equal to the product of the total number of directors on
the ICG Board (including those elected or designated by us)
multiplied by the percentage of the total number of Shares then
outstanding that Arch and us beneficially own in the aggregate,
provided, however, that subject to applicable law and the
rules of the NYSE, Merger Sub is entitled to designate at least
a majority of the directors on the ICG Board at all times
following the acceptance for payment of and payment for all of
the Shares properly tendered and not withdrawn during the
initial offering period (including any extensions). In such
case, upon our request, ICG has agreed to take all actions
reasonably necessary to cause our designees to be elected or
designated to the ICG Board.
Therefore, if we accept shares of ICG common stock for payment
pursuant to the Offer, Arch will obtain control of the
management of ICG shortly thereafter. However, at all times
prior to the effective time of the Merger, the ICG Board will
maintain three directors who were members of the ICG Board on
the date of the execution of the Merger Agreement, each of whom
must meet certain “independence” and other specified
requirements. A majority vote of these three directors will be
required for ICG to authorize any amendment, waiver or
termination of the Merger Agreement by ICG, or to effect certain
other actions related to or in connection with ICG’s
governing documents or the Merger. See
Section 12 — “Purpose of the Offer; Plans
for ICG; Appraisal Rights.”
What are
the federal income tax consequences of exchanging my Shares
pursuant to the Offer, during a subsequent offering period or
pursuant to the Merger?
If you are a U.S. Holder (as defined in
Section 5 — “Material U.S. Federal Income
Tax Considerations” below), your receipt of cash in
exchange for your Shares pursuant to the Offer, during a
subsequent offering period or pursuant to the Merger will
generally be a taxable transaction for U.S. federal income tax
purposes. If you are a
Non-U.S.
Holder (as defined in Section 5 — “Material
U.S. Federal Income Tax Considerations”), your receipt of
cash in exchange for your Shares pursuant to the Offer, during a
subsequent offering period or pursuant to the Merger generally
will not be subject to U.S. federal income tax, subject to
certain exceptions. ICG stockholders should read carefully
Section 5 entitled “Material U.S. Federal Income Tax
Considerations.”
We urge you to consult with your own tax advisor as to the
particular tax consequences of exchanging your Shares pursuant
to the Offer, during a subsequent offering period or pursuant to
the Merger.
Whom can
I talk to if I have questions about the Offer?
You can call Innisfree M&A Incorporated, the information
agent for the Offer, at
(877) 717-3922
(toll-free for stockholders) or
(212) 750-5833
(collect for banks and brokers). See the back cover of this
Offer to Purchase for additional contact information.
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To the Holders of Shares of
Common Stock of International Coal Group, Inc.:
INTRODUCTION
We, Altas Acquisition Corp., a Delaware corporation
(“Merger Sub”) and a wholly owned subsidiary of
Arch Coal, Inc., a Delaware corporation
(“Arch”), are offering to purchase all
outstanding shares of common stock, par value $0.01 per share
(the “Shares”), of International Coal Group,
Inc., a Delaware corporation (“ICG”), for
$14.60 per Share, net to the sellers in cash, without interest
and less any required withholding taxes, upon the terms and
subject to the conditions set forth in this Offer to Purchase
and the related Letter of Transmittal (which, as amended or
supplemented from time to time, together constitute the
“Offer”).
We will not charge you brokerage fees, commissions or, except as
set forth in Instruction 6 of the Letter of Transmittal,
stock transfer taxes on the sale of Shares pursuant to the
Offer. However, if you do not complete and sign the Internal
Revenue Service
Form W-9
that is enclosed with the Letter of Transmittal (or other
applicable form), you may be subject to backup withholding at
the applicable statutory rate on the gross proceeds payable to
you. See Section 3 — “Procedure for
Tendering Shares — Backup U.S. Federal Income Tax
Withholding.” Stockholders with Shares held in street name
by a broker, dealer, bank, trust company or other nominee should
consult with their nominee to determine if they will be charged
any service fees or commissions. We will pay all charges and
expenses of Computershare Trust Company, N.A. (the
“Depositary”), Innisfree M&A Incorporated
(the “Information Agent”) and Morgan
Stanley & Co. Incorporated (the “Dealer
Manager” or “Morgan Stanley”) incurred
in connection with the Offer. See Section 17 —
“Fees and Expenses.”
We are making the Offer pursuant to an Agreement and Plan of
Merger dated as of May 2, 2011 by and among Arch, Merger
Sub and ICG (the “Merger Agreement”). The
Merger Agreement provides, among other things, that after
consummation of the Offer, Merger Sub will merge with and into
ICG (the “Merger”), with ICG continuing as the
surviving corporation and a wholly owned subsidiary of Arch. At
the effective time of the Merger (the “Effective
Time”), each outstanding Share (other than any Shares
owned by ICG, Arch, Merger Sub and any of their respective
subsidiaries, and any Shares held by stockholders who validly
exercise their appraisal rights in connection with the Merger as
described in Section 12 — “Purpose of the
Offer; Plans for ICG; Appraisal Rights”) will be converted
into the right to receive $14.60 (the “Offer
Price”) in cash, without interest and less any
applicable withholding taxes.
The Merger is subject to the satisfaction or waiver of certain
conditions described in Section 15 —
“Conditions to the Offer.” We cannot waive the Minimum
Condition without the consent of ICG.
Section 13 — “The Transaction
Documents — The Merger Agreement” contains a more
detailed description of the Merger Agreement.
Section 5 — “Material U.S. Federal Income
Tax Considerations” describes the material U.S. federal
income tax consequences of the sale of Shares in the Offer and
the Merger.
On May 1, 2011, the board of directors of ICG (the
“ICG Board”) unanimously:
| • | determined that the Offer and the Merger are fair to and in the best interests of ICG and its stockholders; | |
| • | approved and declared advisable the Merger Agreement and the transactions contemplated thereby, including the Offer and the Merger, in accordance with the General Corporation Law of the State of Delaware (the “DGCL”); and | |
| • | resolved to recommend that ICG’s stockholders accept the Offer and tender their Shares pursuant to the Offer and, if required, adopt the Merger Agreement (the “ICG Board Recommendation”). |
The Offer is conditioned upon, among other things,
(i) there being validly tendered in accordance with the
terms of the Offer, prior to the expiration date of the Offer
and not withdrawn, a number of Shares that, together with the
Shares then beneficially owned by Arch
and/or
Merger Sub, represents at least a majority of the total number
of Shares outstanding on a fully diluted basis (the
“Minimum Condition”) and (ii) the
expiration or termination of any waiting period in connection
with the
Hart-Scott-Rodino
Antitrust
8
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Improvements Act of 1976, as amended, and the regulations
promulgated thereunder (the “HSR Act” and such
condition, the “HSR Condition”). See
Section 15 — “Conditions to the Offer”
and Section 16 — “Certain Legal Matters;
Regulatory Approvals.”
For purposes of the Offer, the words “fully
diluted,” when referring to Shares mean, as of any
time, the number of Shares outstanding, together with all Shares
which ICG would be required to issue pursuant to any then
outstanding equity awards or other securities convertible into
or exercisable or exchangeable for Shares, whether or not
vested, exercisable, convertible or exchangeable and regardless
of the terms and conditions thereof (other than ICG’s 9.00%
Convertible Senior Notes due 2012 and ICG’s 4.00%
Convertible Senior Notes dues 2017 (collectively, the
“Convertible Notes”)). According to ICG, as of
May 12, 2011, there were approximately 204,175,202 Shares
issued and outstanding and approximately 6,669,275 Shares
issuable with respect to stock options and certain other equity
awards. Immediately prior to the commencement of the Offer, Arch
and its subsidiaries (including us) beneficially owned no
Shares; however, Arch and Merger Sub may be deemed to
beneficially own an additional 34,846,511 Shares, representing
approximately 17% of the outstanding Shares as of May 12,
2011, as a result of tender and voting agreements that were
entered into on May 2, 2011 by certain stockholders of ICG
in connection with the Merger Agreement, pursuant to which such
stockholders agreed to tender their Shares in the Offer. Based
on and assuming the foregoing, we anticipate that the Minimum
Condition would be satisfied if approximately 105,422,239 Shares
(including those required to be tendered pursuant to the tender
and voting agreements) are validly tendered pursuant to the
Offer and not withdrawn prior to the expiration of the Offer (as
it may be extended in accordance with the Merger Agreement).
In order to induce us to enter into the Merger Agreement,
certain affiliates of WL Ross & Co. LLC and Fairfax
Financial Holdings Limited owning in the aggregate 34,846,511
Shares, or approximately 17% of the outstanding Shares as of
May 12, 2011, have entered tender and voting agreements,
dated May 2, 2011, with Arch and Merger Sub, pursuant to
which these stockholders have, subject to certain limitations
and exceptions, (i) agreed to tender 34,846,511 Shares, or
approximately 17% of the outstanding Shares as of May 12,
2011, into the Offer, (ii) agreed not to withdraw any such
Shares tendered in the Offer, (iii) agreed to vote such
tendered Shares in favor of the Merger Agreement and against any
acquisition proposal other than the Merger and certain other
related matters and (iv) granted to certain officers of
Arch an irrevocable proxy to vote such tendered Shares in favor
of the Merger Agreement and against any other acquisition
proposal and certain other related matters. For a discussion of
the tender and voting agreements, see
Section 13 — “The Transaction
Documents — Other Agreements — Tender and
Voting Agreements.”
Upon the time when Shares are first accepted for payment under
the Offer (the “Appointment Time”), the Merger
Agreement provides that Merger Sub will become entitled to elect
or designate a number of directors to the ICG Board, rounded up
to the next whole number, that is equal to the product of the
total number of directors on the ICG Board (including those
elected or designated by Merger Sub) multiplied by the
percentage of the total number of Shares then outstanding that
Arch and Merger Sub beneficially own in the aggregate,
provided, however, that subject to applicable law
and the rules of the New York Stock Exchange (the
“NYSE”), Merger Sub is entitled to designate at
least a majority of the directors on the ICG Board at all times
following the Appointment Time. Merger Sub currently intends,
promptly after consummation of the Offer, to exercise this right
and to designate officers or employees of Arch or an affiliate
of Arch to serve as directors of ICG. We expect that such
representation on the ICG Board would permit us to exert
substantial influence over ICG’s conduct of its business
and operations. However, prior to the Effective Time, the ICG
Board will maintain three directors who were members of the ICG
Board on the date of the Merger Agreement, each of whom must
meet certain “independence” and other specified
requirements. A majority vote of these three directors will be
required for ICG to authorize any amendment, waiver or
termination of the Merger Agreement by ICG, or to effect certain
other actions related to or in connection with ICG’s
governing documents or the Merger. See
Section 12 — “Purpose of the Offer; Plans
for ICG; Appraisal Rights.” Merger Sub currently intends,
as soon as possible after consummation of the Offer, to
consummate the Merger pursuant to the Merger Agreement.
Following the Merger, the directors of Merger Sub will be the
directors of the surviving corporation in the Merger.
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Pursuant to the Merger Agreement, following our acceptance for
payment of the Shares pursuant to the Offer, we have the option
to purchase from ICG, subject to certain limitations, up to a
number of additional Shares sufficient to cause Arch and its
subsidiaries to own one Share more than 90% of the then
outstanding Shares (on a fully diluted basis). See
Section 13 — “The Transaction
Documents — The Merger Agreement —
Top-Up
Option.”
Under the terms of the Merger Agreement, if Arch, Merger Sub and
their respective subsidiaries hold, in the aggregate, at least
90% of the total outstanding Shares, then Arch, Merger Sub and
ICG will act to effect the Merger under the
“short-form” merger provisions of Section 253 of
the DGCL. See Section 13 — “The Transaction
Documents — The Merger Agreement —
Short-Form Merger Procedure.”
The Offer is conditioned upon the fulfillment of the conditions
described in Section 15 — “Conditions to the
Offer.” We may waive some of the conditions to the Offer
without the consent of ICG; however, we cannot waive the Minimum
Condition without ICG’s consent. The Offer will expire at
8:00 a.m., New York City time, on Tuesday, June 14,
2011, unless we extend the Offer.
THIS OFFER TO PURCHASE AND THE RELATED LETTER OF TRANSMITTAL
CONTAIN IMPORTANT INFORMATION, AND YOU SHOULD CAREFULLY READ
BOTH IN THEIR ENTIRETY BEFORE YOU MAKE A DECISION WITH RESPECT
TO THE OFFER.
THE
OFFER
1. Terms of the
Offer. Upon the terms and subject to the
conditions set forth in the Offer, we will accept for payment
and pay for all Shares that are validly tendered and not
withdrawn in accordance with the procedures set forth in
Section 3 — “Procedure for Tendering
Shares” at or prior to the Expiration Time.
“Expiration Time” means 8:00 a.m., New
York City time, on Tuesday, June 14, 2011, unless extended,
in which event “Expiration Time” means the
latest time and date at which the Offer, as so extended, will
expire.
The Offer is conditioned upon, among other things, the
satisfaction of the Minimum Condition, the HSR Condition and the
other conditions set forth in Section 15 —
“Conditions to the Offer.” See
Section 16 — “Certain Legal Matters;
Regulatory Approvals.” We can waive some of the conditions
to the Offer without the consent of ICG; however, we cannot
waive the Minimum Condition without ICG’s consent. If any
condition to the Offer is not satisfied or waived at any
scheduled Expiration Time, we will extend the Expiration Time
for an additional period or successive periods of up to five
business days (or such longer period as the parties may agree)
per extension until all of the conditions to the Offer are
satisfied or waived. In addition, we will extend the Offer for
any period required by any applicable law or any rule,
regulation, interpretation or position of the United States
Securities and Exchange Commission (the “SEC”)
(or its staff) or the NYSE. Furthermore, if the marketing period
for the financing of the Offer (as set forth in
Section 15 — “Conditions to the Offer) has
not ended on the last business day prior to any scheduled
Expiration Time, we may extend the Offer until the earlier of
(i) the first business day after the final day of the
marketing period or (ii) any business day before or during
the marketing period as may be specified by Arch on no less than
two business days’ prior notice to ICG. Finally, if at any
scheduled Expiration Time, any condition to the Offer (other
than the Minimum Condition) shall have been satisfied or waived
and the Minimum Condition shall not have been satisfied, then we
may extend, and if requested by ICG, we will extend, the Offer
by periods of five business days, provided that the
maximum number of days that the Offer may be extended in this
manner shall be twenty business days. We will also not be
required to extend the Offer beyond August 2, 2011, or, if
the HSR Condition has not been satisfied by August 2, 2011,
then this date will automatically be extended to
November 2, 2011 (as such date may be extended, the
“Outside Date”). However, we do not have any
obligation to extend the Offer beyond the date that is 20
business days after the date that all of the conditions to the
Offer have been satisfied other than the Minimum Condition.
During any extension of the Offer, all Shares previously
tendered and not withdrawn will remain subject to the Offer and
subject to your right to withdraw such Shares. See
Section 4 — “Withdrawal Rights” and
Section 15 — “Conditions to the Offer.”
In accordance with
Rule 14d-11
under the Securities Exchange Act of 1934, as amended (the
“Exchange Act”) and the Merger Agreement, we
will provide, if necessary or desirable to obtain at least 90%
of the total
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outstanding Shares entitled to vote on the adoption of the
Merger Agreement (the
“Short-Form Threshold”), a subsequent
offering period (and one or more extensions thereof) following
the Expiration Time (a “Subsequent Offering
Period”). If provided, a Subsequent Offering Period
will be an additional period of time, following the expiration
of the Offer and the purchase of Shares in the Offer, during
which stockholders may tender any Shares not previously tendered
in the Offer. If a Subsequent Offering Period is made available,
(i) it will remain open for such period or periods as we
will specify of up to 20 business days, (ii) Shares may be
tendered in the same manner as was applicable to the Offer
except that any Shares tendered may not be withdrawn,
(iii) we will immediately accept and promptly pay for
Shares as they are tendered and (iv) the price per Share
will be the same as the Offer Price. Pursuant to
Rule 14d-7(a)(2)
under the Exchange Act, withdrawal rights do not apply to Shares
tendered during a Subsequent Offering Period. A Subsequent
Offering Period, if one is provided, is not an extension of the
Offer, which already would have been completed. For purposes of
the Offer as provided under the Exchange Act, a
“business day” means any day other than a
Saturday, Sunday or a U.S. federal holiday and consists of the
time period from 12:01 a.m. through 12:00 midnight, New
York City time.
If we provide a Subsequent Offering Period, we will make a
public announcement of such Subsequent Offering Period or
extension no later than 9:00 a.m., New York City time, on
the next business day after the Expiration Time or the date of
termination of the prior Subsequent Offering Period.
We also reserve the right to waive, in whole or in part, any of
the conditions to the Offer and to increase the Offer Price,
provided that ICG’s consent is required for us to
(i) decrease the Offer Price, (ii) change the form of
consideration payable in the Offer, (iii) reduce the number
of Shares to be purchased in the Offer, (iv) amend or
modify any of the conditions to the Offer or impose conditions
to the Offer that are different than or in addition to those set
forth in Section 15 — “Conditions to the
Offer,” (v) amend or waive the Minimum Condition, (vi)
otherwise amend or modify any terms of the Offer in a manner
that is, or could reasonably be expected to be, adverse to
holders of Shares or (vii) extend or otherwise change the
Expiration Time in a manner other than pursuant to and in
accordance with the Merger Agreement.
If we make a material change to the terms of the Offer or waive
a material condition to the Offer, we will extend the Offer and
disseminate additional tender offer materials to the extent
required by applicable law. The minimum period during which a
tender offer must remain open following material changes in the
terms of the offer, other than a change in price or a change in
percentage of securities sought, depends upon the facts and
circumstances, including the materiality of the changes. In a
published release, the SEC has stated that in its view an offer
must remain open for a minimum period of time following a
material change in the terms of such offer and that the waiver
of a condition such as the Minimum Condition is a material
change in the terms of an offer. The release states that an
offer should remain open for a minimum of five business days
from the date the material change is first published, sent or
given to stockholders, and that if material changes are made
with respect to information that approaches the significance of
price and the percentage of securities sought, a minimum of ten
business days generally must be required to allow adequate
dissemination and investor response. Accordingly, if, prior to
the Expiration Time, we increase the consideration to be paid
for Shares in the Offer, and if the Offer is scheduled to expire
at any time before the expiration of a period of ten business
days from, and including, the date that notice of such increase
is first published, sent or given in the manner specified below,
we will extend the Offer at least until the expiration of that
period of ten business days. If, prior to the Expiration
Time, Merger Sub increases the consideration being paid for
Shares accepted for payment pursuant to the Offer, such
increased consideration will be paid to all stockholders whose
Shares are purchased pursuant to the Offer, whether or not such
Shares were tendered prior to the announcement of the increase
in consideration.
Any extension, termination or amendment of the Offer will be
followed promptly by a public announcement thereof. Without
limiting the manner in which we may choose to make any public
announcement, we will have no obligation (except as otherwise
required by applicable law) to publish, advertise or otherwise
communicate any such public announcement other than by making a
release to the Dow Jones News Service. In the case of an
extension of the Offer, we will make a public announcement of
such extension no later than 9:00 a.m., New York City time,
on the next business day after the previously scheduled
Expiration Time.
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ICG has provided us with its stockholder lists and security
position listings for the purpose of disseminating the Offer to
holders of Shares. We will send this Offer to Purchase, the
related Letter of Transmittal and other related documents to
record holders of Shares and to brokers, dealers, banks, trust
companies and other nominees whose names appear on the
stockholder lists or, if applicable, who are listed as
participants in a clearing agency’s security position
listing for subsequent transmittal to beneficial owners of
Shares.
2. Acceptance for Payment and
Payment. Upon the terms and subject to the
conditions to the Offer (including, if the Offer is extended or
amended, the terms and conditions of any extension or
amendment), we will accept for payment and pay for all Shares
validly tendered and not properly withdrawn prior to the
Expiration Time promptly after the later of (i) the
Expiration Time and (ii) the satisfaction or waiver of the
conditions to the Offer set forth in Section 15 —
“Conditions to the Offer.” We can waive some of the
conditions to the Offer without the consent of ICG; however, we
cannot waive the Minimum Condition without ICG’s consent.
If we provide a Subsequent Offering Period, we will immediately
accept and promptly pay for Shares as they are tendered during
the Subsequent Offering Period. Notwithstanding the foregoing,
subject to the terms and conditions of the Merger Agreement and
any applicable rules and regulations of the SEC, including
Rule 14e-1(c)
under the Exchange Act, we will extend the offering period,
thereby delaying the acceptance for payment of shares of ICG
common stock, until the HSR Condition specified in
Section 16 — “Certain Legal Matters;
Regulatory Approvals” has been satisfied, provided
that we will not be required to (although we may) extend the
Offer beyond the Outside Date. For information with respect to
the waiting period that we are required to observe under the HSR
Act, see Section 16 — “Certain Legal
Matters; Regulatory Approvals.”
We will pay for Shares accepted for payment pursuant to the
Offer by depositing the purchase price with the Depositary,
which will act as your agent for the purpose of receiving
payments from us and transmitting such payments to you. Upon the
deposit of such funds with the Depositary, Merger Sub’s
obligation to make such payment will be satisfied, and tendering
stockholders must thereafter look solely to the Depositary for
payment of amounts owed to them by reason of the acceptance for
payment of Shares pursuant to the Offer.
In all cases (including during any Subsequent Offering Period),
payment for Shares that are accepted for payment will be made
only after timely receipt by the Depositary of
(i) certificates for such Shares (or of a confirmation of a
book-entry transfer of such Shares (a “Book-Entry
Confirmation”) into the Depositary’s account at
the Book-Entry Transfer Facility (defined in
Section 3 — “Procedure for Tendering
Shares — Book-Entry Delivery”)), (ii) a
properly completed and duly executed Letter of Transmittal (or a
manually signed facsimile thereof), with any required signature
guarantees or an Agent’s Message (defined in
Section 3 — “Procedure for Tendering
Shares — Book-Entry Delivery”) in connection with
a book-entry transfer and (iii) any other documents
required by the Letter of Transmittal. For a description of the
procedure for tendering Shares pursuant to the Offer, see
Section 3 — “Procedure for Tendering
Shares.” Accordingly, payment may be made to tendering
stockholders at different times if delivery of the Shares and
other required documents occur at different times.
For purposes of the Offer, we will be deemed to have accepted
for payment tendered Shares when, as and if we give oral or
written notice of our acceptance to the Depositary.
Under no circumstances will we pay interest on the
consideration paid for Shares pursuant to the Offer, regardless
of any extension of the Offer or any delay in making such
payment.
If we do not accept for payment any tendered Shares pursuant to
the Offer for any reason, or if you submit certificates for more
Shares than are tendered, we will return certificates (or issue
new certificates) representing unpurchased or untendered Shares,
without expense to you (or, in the case of Shares delivered by
book-entry transfer into the Depositary’s account at the
Book-Entry Transfer Facility pursuant to the procedures set
forth in Section 3 — “Procedure for
Tendering Shares,” the Shares will be credited to an
account maintained at the Book-Entry Transfer Facility),
promptly following the expiration, termination or withdrawal of
the Offer.
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We reserve the right to transfer or assign, in whole or from
time to time in part, to one or more of our affiliates the right
to purchase Shares tendered pursuant to the Offer, but any such
transfer or assignment will not relieve us of our obligations
under the Offer or prejudice your rights to receive payment for
Shares validly tendered and accepted for payment.
Valid Tender of Shares. Except as set forth
below, in order for a stockholder to validly tender Shares
pursuant to the Offer, either (i) the Depositary must
receive the Letter of Transmittal (or a manually signed
facsimile thereof), properly completed and signed, together with
any required signature guarantees or an Agent’s Message in
connection with a book-entry delivery of Shares, and any other
documents that the Letter of Transmittal requires, at one of its
addresses set forth on the back cover of this Offer to Purchase
on or prior to the Expiration Time and either (x) the share
certificates evidencing tendered Shares (the “Share
Certificates”) must be received by the Depositary at
such address or (y) such Shares must be tendered pursuant
to the procedure for book-entry transfer described below and a
Book-Entry Confirmation must be received by the Depositary, in
each case prior to the Expiration Time or (ii) the
tendering stockholder must comply with the guaranteed delivery
procedures described below under “Guaranteed Delivery.”
The method of delivery of Shares, the Letter of Transmittal
and all other required documents, including delivery through the
Book-Entry Transfer Facility, is at the election and risk of the
tendering stockholder. Delivery of all such documents will be
deemed made only when actually received by the Depositary
(including, in the case of a book-entry transfer, by Book-Entry
Confirmation). If such delivery is by mail, it is recommended
that all such documents be sent by properly insured registered
mail with return receipt requested in time to be received on or
prior to the Expiration Time. In all cases, sufficient time
should be allowed to ensure timely delivery.
The tender of Shares pursuant to any one of the procedures
described above will constitute your acceptance of the Offer, as
well as your representation and warranty that (i) you own
the Shares being tendered within the meaning of
Rule 14e-4
under the Exchange Act, (ii) the tender of such Shares
complies with
Rule 14e-4
under the Exchange Act and (iii) you have the full power
and authority to tender, sell, assign and transfer the Shares
tendered, as specified in the Letter of Transmittal. Our
acceptance for payment of Shares tendered by you pursuant to the
Offer will constitute a binding agreement between us with
respect to such Shares, upon the terms and subject to the
conditions of the Offer.
Book-Entry Delivery. The Depositary will
establish an account with respect to the Shares for purposes of
the Offer at The Depository Trust Company (the
“Book-Entry Transfer Facility”) within two
business days after the date of this Offer to Purchase. Any
financial institution that is a participant in the system of the
Book-Entry Transfer Facility may deliver Shares by causing the
Book-Entry Transfer Facility to transfer such Shares into the
Depositary’s account in accordance with the procedures of
the Book-Entry Transfer Facility for such transfer. However,
although delivery of Shares may be effected through book-entry
transfer, either the Letter of Transmittal (or a manually signed
facsimile thereof) properly completed and duly executed together
with any required signature guarantees, or an Agent’s
Message in lieu of the Letter of Transmittal, and any other
required documents must, in any case, be received by the
Depositary at one of its addresses set forth on the back cover
of this Offer to Purchase prior to the Expiration Time, or the
tendering stockholder must comply with the guaranteed delivery
procedure described below under “Guaranteed Delivery.”
Delivery of the Letter of Transmittal and any other required
documents to the Book-Entry Transfer Facility does not
constitute delivery to the Depositary.
“Agent’s Message” means a message
transmitted by the Book-Entry Transfer Facility to, and received
by, the Depositary and forming a part of a Book-Entry
Confirmation stating that the Book-Entry Transfer Facility has
received an express acknowledgment from the participant in the
Book-Entry Transfer Facility tendering the Shares that 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 we may enforce that agreement against
such participant.
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Signature Guarantees. Except as otherwise
provided below, all signatures on a Letter of Transmittal must
be guaranteed by a financial institution (including most banks,
savings and loan associations and brokerage houses) that is a
member of a recognized Medallion Program approved by The
Securities Transfer Association Inc., including the Securities
Transfer Agents Medallion Program (STAMP), the Stock Exchange
Medallion Program (SEMP) and the New York Stock Exchange
Medallion Signature Program (MSP) or any other “eligible
guarantor institution” (as such term is defined in
Rule 17Ad-15
under the Exchange Act) (each, an “Eligible
Institution”), unless the tendered Shares are tendered
(i) by a registered holder of Shares who has not completed
either the box labeled “Special Payment Instructions”
or the box labeled “Special Delivery Instructions” on
the Letter of Transmittal or (ii) for the account of an
Eligible Institution. See Instructions 1 and 5 of the
Letter of Transmittal.
If the certificates for the Shares are registered in the name of
a person other than the signer of the Letter of Transmittal, or
if payment is to be made to, or certificates for unpurchased
Shares are to be issued or returned to, a person other than the
registered holder, then the tendered certificates for the Shares
must be endorsed or accompanied by appropriate stock powers,
signed exactly as the name or names of the registered holder or
holders appear on the certificates for the Shares, with the
signatures on the certificates for the Shares or stock powers
guaranteed by an Eligible Institution as provided in the Letter
of Transmittal. See Instructions 1 and 5 of the Letter of
Transmittal.
If the certificates representing the Shares are forwarded
separately to the Depositary, a properly completed and duly
executed Letter of Transmittal (or a manually signed facsimile
thereof) must accompany each delivery of certificates for the
Shares.
Guaranteed Delivery. If a stockholder desires
to tender Shares pursuant to the Offer and the Share
Certificates evidencing such stockholder’s Shares are not
immediately available or such stockholder cannot deliver the
Share Certificates and all other required documents to the
Depositary prior to the Expiration Time, or such stockholder
cannot complete the procedure for delivery by book-entry
transfer on a timely basis, such Shares may nevertheless be
tendered, provided that all of the following conditions
are satisfied:
| • | such tender is made by or through an Eligible Institution; | |
| • | a properly completed and duly executed Notice of Guaranteed Delivery in the form provided by us with this Offer to Purchase is received by the Depositary (as provided below) by the Expiration Time; and | |
| • | the Share Certificates (or a Book-Entry Confirmation) evidencing all tendered Shares, in proper form for transfer, in each case together with a properly completed and duly executed Letter of Transmittal (or a manually signed facsimile thereof) together, with any required signature guarantee (or, in the case of a book-entry transfer, an Agent’s Message) and any other required documents, are received by the Depositary within three NYSE trading days after the date of execution of such Notice of Guaranteed Delivery. |
The Notice of Guaranteed Delivery may be delivered by overnight
courier, transmitted by manually signed facsimile transmission
or mailed to the Depositary and must include a guarantee by an
Eligible Institution in the form set forth in the form of Notice
of Guaranteed Delivery made available by us.
Backup U.S. Federal Income Tax
Withholding. Under the “backup
withholding” provisions of U.S. federal income tax law, the
Depositary may be required to withhold and pay over to the
Internal Revenue Service (the “IRS”) a portion
(currently 28%) of the amount of any payments made to a holder
of Shares who tenders Shares pursuant to the Offer or exchanges
Shares pursuant to the Merger. Backup withholding generally will
not apply, however, to (i) a U.S. Holder (as defined in
Section 5 ‘‘ — Material U.S. Federal
Income Tax Considerations”) of Shares who furnishes a
correct taxpayer identification number (“TIN”)
and complies with certain certification procedures (generally,
by providing a properly completed Substitute
Form W-9,
which will be included with the Letter of Transmittal to be
returned to the Depositary) or otherwise establishes an
exemption or (ii) a
Non-U.S.
Holder (as defined in Section 5 — “Material
U.S. Federal Income Tax Considerations”) of Shares who
certifies under penalties of perjury on an appropriate and
properly completed IRS
Form W-8
(a copy of which may be obtained from the Depositary) that such
holder is not a
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U.S. person. See Section 5 — “Material U.S.
Federal Income Tax Considerations — Information
Reporting and Backup Withholding” for additional
information.
Appointment of Proxy. By executing a Letter of
Transmittal, a tendering stockholder will irrevocably appoint
each of our designees as such stockholder’s
attorneys-in-fact and proxies, with full power of substitution,
in the manner set forth in the Letter of Transmittal to the full
extent of such stockholder’s rights with respect to the
Shares tendered and accepted for payment by us (and any and all
other Shares or other securities issued or issuable in respect
of such Shares on or after the date of this Offer to Purchase).
All such powers of attorney and proxies are irrevocable and
coupled with an interest in the tendered Shares. Such
appointment will be effective when, and only to the extent that,
we accept for payment Shares tendered by such stockholder as
provided herein. Upon such appointment, all prior powers of
attorney, proxies and consents given by such stockholder with
respect to such Shares or other securities or rights will,
without further action, be revoked and no subsequent powers of
attorney, proxies, consents or revocations may be given by such
stockholder (and, if given, will not be deemed effective). Our
designees will thereby be empowered to exercise all voting and
other rights with respect to such Shares and other securities or
rights, including, without limitation, in respect of any annual,
special or adjourned meeting of ICG’s stockholders, actions
by written consent in lieu of any such meeting or otherwise, as
they in their sole discretion deem proper. In order for Shares
to be deemed validly tendered, immediately upon our acceptance
for payment of such Shares, we must be able to exercise full
voting, consent and other rights with respect to such Shares and
other related securities or rights, including voting at any
meeting of stockholders.
The foregoing powers of attorney and proxies are effective
only upon acceptance for payment of Shares pursuant to the
Offer. The Offer does not constitute a solicitation of proxies,
absent a purchase of Shares, for any meeting of ICG’s
stockholders.
Determination of Validity. All questions as to
purchase price (subject to the terms of the Merger Agreement),
the form of documents and the validity, eligibility (including
time of receipt) and acceptance for payment of any tender of
Shares will be determined by us in our sole discretion, which
determinations shall be final and binding on all parties. We
reserve the absolute right to reject any or all tenders of
Shares that we determine not to be in proper form or the
acceptance of which or payment for which may, in the opinion of
our counsel, be unlawful. We also reserve the absolute right to
waive any of the conditions of the Offer (other than the Minimum
Condition, which may only be waived with the prior written
consent of ICG) and any defect or irregularity in the tender of
any particular Shares, and our interpretation of the terms of
the Offer (including these instructions) will be final and
binding on all parties. No tender of Shares will be deemed to be
properly made until all defects and irregularities have been
cured or waived. Unless waived, any defects or irregularities in
connection with tenders must be cured within such time as we
shall determine. None of Arch, Merger Sub or any of their
respective affiliates or assigns, the Depositary, the Dealer
Manager, the Information Agent or any other person is or will be
obligated to give notice of any defects or irregularities in
tenders and none of them will incur any liability for failure to
give any such notice.
4. Withdrawal
Rights. Except as described in this
Section 4, tenders of Shares made in the Offer are
irrevocable. You may withdraw tenders of Shares made pursuant to
the Offer at any time before the Expiration Time and, unless
theretofore accepted for payment as provided herein, tenders of
Shares may also be withdrawn after the date that is 60 days
from the date of this Offer to Purchase, unless previously
accepted for payment pursuant to the Offer as provided herein.
If we extend the period of time during which the Offer is open,
are delayed in accepting for payment or paying for Shares or are
unable to accept for payment or pay for Shares pursuant to the
Offer for any reason, then, without prejudice to our rights
under the Offer, the Depositary may, on our behalf, retain all
Shares tendered, and such Shares may not be withdrawn, except to
the extent that you duly exercise withdrawal rights as described
in this Section 4 before the Expiration Time or at any time
after the date that is 60 days from the date of this Offer
to Purchase, unless previously accepted for payment pursuant to
the Offer as provided herein.
For a withdrawal of Shares to be effective, a written,
telegraphic or facsimile transmission notice of withdrawal with
respect to the Shares must be timely received by the Depositary
at one of its addresses set
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forth on the back cover of this Offer to Purchase, and the
notice of withdrawal must specify the name of the person who
tendered the Shares to be withdrawn, the number of Shares to be
withdrawn and the name of the registered holder of Shares, if
different from that of the person who tendered such Shares. If
the Shares to be withdrawn have been delivered to the
Depositary, a signed notice of withdrawal with (except in the
case of Shares tendered by an Eligible Institution) signatures
guaranteed by an Eligible Institution must be submitted before
the release of such Shares. If Shares have been tendered
pursuant to the procedures for book-entry transfer as set forth
in Section 3 — “Procedure for Tendering
Shares,” any notice of withdrawal must specify the name and
number of the account at the Book-Entry Transfer Facility to be
credited with the withdrawn Shares. If certificates representing
the Shares to be withdrawn have been delivered or otherwise
identified to the Depositary, then, prior to the physical
release of such certificates, the name of the registered owner
and the serial numbers shown on such certificates must also be
furnished to the Depositary. Withdrawals of tenders of Shares
may not be rescinded and any Shares properly withdrawn will be
deemed not validly tendered for purposes of the Offer. Withdrawn
Shares may, however, be retendered by following one of the
procedures for tendering Shares described in
Section 3 — “Procedure for Tendering
Shares” at any time prior to the expiration of the Offer.
If we provide a Subsequent Offering Period (as described in more
detail in Section 1 — “Terms of the
Offer”) following the Offer, no withdrawal rights will
apply to Shares tendered in such Subsequent Offering Period or
to Shares previously tendered in the Offer and accepted for
payment.
We will determine, in our sole discretion, all questions as
to the form and validity (including time of receipt) of any
notice of withdrawal, and such determination will be final and
binding. No withdrawal of Shares shall be deemed to have been
properly made until all defects and irregularities have been
cured or waived. None of Arch, Merger Sub or any of their
respective affiliates or assigns, the Depositary, the Dealer
Manager, the Information Agent or any other person will be under
any duty to give notification of any defects or irregularities
in any notice of withdrawal or incur any liability for failure
to give such notification.
5. Material U.S. Federal Income Tax
Considerations. The following is a general
discussion of the material U.S. federal income tax consequences
to U.S. Holders and
Non-U.S.
Holders (in each case, as defined below) who exchange Shares for
cash pursuant to the Offer, during a Subsequent Offering Period
or pursuant to the Merger. This discussion does not address any
tax consequences arising under the unearned income Medicare
contribution tax pursuant to the Health Care and Education
Reconciliation Act of 2010, and any state, local or foreign tax
consequences, nor does it address any U.S. federal tax
considerations other than those pertaining to the U.S. federal
income tax. This discussion also does not address the tax
consequences to holders of Shares who exercise appraisal rights
under Delaware law.
The following discussion applies only if you hold your Shares as
a capital asset within the meaning of Section 1221 of the
Internal Revenue Code of 1986, as amended (the
“Code”) (generally, property held for
investment). Further, this discussion does not purport to
consider all aspects of U.S. federal income taxation that might
be relevant to stockholders in light of their particular
circumstances and does not apply to stockholders subject to
special treatment under the U.S. federal income tax laws (such
as, for example, financial institutions, dealers or brokers in
securities, commodities or foreign currency, traders in
securities who elect to apply a
mark-to-market
method of accounting, insurance companies, banks and certain
other financial institutions, mutual funds, tax-exempt
organizations, former citizens or residents of the United
States, U.S. expatriates, stockholders that are pass-through
entities or the investors in such pass-through entities,
regulated investment companies, real estate investment trusts,
U.S. Holders whose “functional currency” is not the
U.S. dollar, investors liable for the alternative minimum tax,
controlled foreign corporations, passive foreign investment
companies, persons who hold shares as part of a hedge, straddle,
constructive sale or conversion transaction, and persons who
acquired their Shares through the exercise of employee stock
options, through a tax qualified retirement plan or otherwise as
compensation).
This discussion is based upon the Code, the regulations
promulgated thereunder and court and administrative ruling and
decisions, all as in effect on the date of this Offer to
Purchase. These authorities may change, possibly retroactively,
and any change could affect the accuracy of the statements and
conclusions set
16
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forth in this discussion. We have not sought, nor do we expect
to seek, any ruling from the Internal Revenue Service with
respect to the matters discussed below. There can be no
assurances that the Internal Revenue Service will not take a
different position concerning the tax consequences of the
exchange of Shares for cash pursuant to the Offer, during a
Subsequent Offering Period or pursuant to the Merger or that any
such position would be sustained.
Due to the individual nature of tax consequences, you should
consult your tax advisors as to the specific tax consequences to
you of the exchange of Shares for cash pursuant to the Offer,
during a Subsequent Offering Period or pursuant to the Merger,
including the applicability and effect of the alternative
minimum tax and any state, local, foreign and other tax laws.
U.S. Holders. Except as otherwise set forth
below, the following discussion is limited to the material U.S.
federal income tax consequences relevant to a beneficial owner
of Shares that is a citizen or resident of the United States, a
domestic corporation (or any other entity or arrangement treated
as a domestic corporation for U.S. federal income tax purposes),
an estate that is subject to U.S. federal income tax on its
worldwide income from all sources, or a trust if (i) a
court within the United States is able to exercise primary
supervision over the administration of the trust and one or more
U.S. persons have the authority to control all substantial
decisions of the trust or (ii) the trust has a valid
election in effect under applicable U.S. Treasury Regulations to
be treated as a U.S. person (each, a “U.S.
Holder”). If a partnership (including any entity or
arrangement treated as a partnership for U.S. federal income tax
purposes) holds Shares, the tax treatment of a partner in the
partnership generally will depend upon the status of the partner
and the activities of the partnership. Persons holding Shares
through a partnership should consult their own tax advisors
regarding the tax consequences of exchanging the Shares for cash
pursuant to the Offer, during a Subsequent Offering Period or
pursuant to the Merger.
Your exchange of Shares for cash pursuant to the Offer, during a
Subsequent Offering Period or pursuant to the Merger will be a
taxable transaction for U.S. federal income tax purposes and may
also be a taxable transaction under applicable state, local,
foreign and other tax laws. In general, if you exchange Shares
for cash pursuant to the Offer, during a Subsequent Offering
Period or pursuant to the Merger, you will recognize gain or
loss for U.S. federal income tax purposes equal to the
difference between the adjusted tax basis of your Shares and the
amount of cash received in exchange therefor (determined before
the deduction of backup withholding, if any). Gain or loss will
be determined separately for each block of Shares (i.e.,
Shares acquired for the same cost in a single transaction)
exchanged pursuant to the Offer, during a Subsequent Offering
Period or pursuant to the Merger. Such gain or loss generally
will be capital gain or loss and generally will be long-term
capital gain or loss if your holding period for the Shares is
more than one year as of the date of the exchange of such
Shares. Long-term capital gains of noncorporate taxpayers are
generally subject to U.S. federal income tax at preferential
rates. The deduction of capital losses is subject to limitations.
Non-U.S.
Holders. The following is a discussion of the
material U.S. federal income tax consequences that will apply if
you are a
Non-U.S.
Holder of Shares. The term
“Non-U.S.
Holder” means a beneficial owner of Shares that is not
a U.S. Holder or a partnership or other pass-through entity.
Payments made to a
Non-U.S.
Holder with respect to Shares exchanged in the Offer, during a
Subsequent Offering Period or pursuant to the Merger generally
will not be subject to U.S. federal income tax, unless:
(i) the gain, if any, on such Shares is effectively
connected with the conduct by the
Non-U.S.
Holder of a trade or business in the United States (and, if
certain income tax treaties apply, is attributable to the
Non-U.S.
Holder’s permanent establishment in the United States), in
which event (a) the
Non-U.S.
Holder will be subject to U.S. federal income tax in the same
manner as if it were a U.S. Holder (but such
Non-U.S.
Holder should provide an Internal Revenue Service
Form W-8ECI
(or a suitable substitute or successor form) instead of an
Internal Revenue Service
Form W-9),
and (b) if the
Non-U.S.
Holder is a corporation, it may also be subject to a branch
profits tax at a rate of 30% (or such lower rate as may be
specified under an applicable income tax treaty), (ii) the
Non-U.S.
Holder is an individual who was present in the United States for
183 days or more in the taxable year of sale and certain
other conditions are met, in which event the
Non-U.S.
Holder will be subject to tax at a rate of 30% (or such lower
rate as may be specified under an applicable income tax treaty)
on the gain from the exchange of the Shares net of applicable
U.S. losses from sales or exchanges of
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other capital assets recognized during the year or (iii) we
are or have been a “United States real property holding
corporation” for U.S. federal income tax purposes and the
Non-U.S.
Holder holds or held more than 5% of Shares, as described below.
Based on information provided to us by ICG, we believe that ICG
is currently a “United States real property holding
corporation” for U.S. federal income tax purposes. So long
as the Shares continue to be regularly traded on an established
securities market, only a
Non-U.S.
Holder who holds or held (at any time during the shorter of the
five year period preceding the date of disposition or the
holder’s holding period) more than 5% of ICG’s Shares
will be subject to U.S. federal income tax on the disposition of
Shares.
Information Reporting and Backup
Withholding. Proceeds from the sale of Shares
pursuant to the Offer, during a Subsequent Offering Period or
pursuant to the Merger generally are subject to information
reporting, and may be subject to backup withholding at the
applicable statutory rate (currently 28%) unless you are a U.S.
Holder and you provide the Depositary with your correct taxpayer
identification number and certify that you are not subject to
such backup withholding by completing the Substitute
Form W-9
included in the Letter of Transmittal or otherwise establish an
exemption from backup withholding. If you are a
Non-U.S.
Holder, you generally will not be subject to backup withholding
if you certify your foreign status on the appropriate Internal
Revenue Service
Form W-8.
Backup withholding is not an additional U.S. federal income tax.
Rather, the U.S. federal income tax liability of the person
subject to backup withholding will be reduced by the amount of
tax withheld. If withholding results in an overpayment of taxes,
a refund may generally be obtained, provided that the
required information is timely furnished to the Internal Revenue
Service. See Section 3 — “Procedure for
Tendering Shares — Backup U.S. Federal Income Tax
Withholding.”
6. Price Range of
Shares. The Shares are listed and principally
traded on the NYSE under the symbol “ICO.” The
following table sets forth for the periods indicated the high
and low sales prices per Share on the NYSE as reported in
published financial sources:
| High | Low | |||||||
|
FY 2009
|
||||||||
|
First Quarter
|
$ | 3.24 | $ | 1.09 | ||||
|
Second Quarter
|
$ | 3.70 | $ | 1.54 | ||||
|
Third Quarter
|
$ | 4.59 | $ | 2.24 | ||||
|
Fourth Quarter
|
$ | 5.35 | $ | 3.47 | ||||
|
FY 2010
|
||||||||
|
First Quarter
|
$ | 4.89 | $ | 3.36 | ||||
|
Second Quarter
|
$ | 5.71 | $ | 3.59 | ||||
|
Third Quarter
|
$ | 5.49 | $ | 3.62 | ||||
|
Fourth Quarter
|
$ | 8.59 | $ | 5.24 | ||||
|
FY 2011
|
||||||||
|
First Quarter
|
$ | 11.50 | $ | 7.66 | ||||
|
Second Quarter (through May 13, 2011)
|
$ | 14.50 | $ | 10.08 | ||||
On February 4, 2011, immediately prior to the time at which
market speculation became apparent regarding a potential sale of
ICG, the reported closing sales price per Share on the NYSE was
$8.38. On April 29, 2011, the last full trading day before
the announcement of the Offer and the possible Merger, the
reported closing sales price per Share on the NYSE was $11.03.
On May 13, 2011, the last full trading day before the date
of this Offer to Purchase, the reported closing sales price per
Share on the NYSE was $14.45. Before deciding whether to
tender, you should obtain a current market quotation for the
Shares.
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Possible Effects of the Offer on the Market for the
Shares. If the Offer is consummated but the
Merger does not take place, the number of stockholders, and the
number of Shares that are still in the hands of the public, may
be so small that there will no longer be an active or liquid
public trading market (or possibly any public trading market)
for Shares held by stockholders other than Merger Sub. We 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 price paid in the Offer. If the Merger
is consummated, stockholders not tendering their Shares in the
Offer will receive cash in an amount equal to the price per
Share paid in the Offer. Therefore, if the Merger takes place,
the only difference between tendering and not tendering Shares
in the Offer is that tendering stockholders will be paid earlier.
Stock Exchange Listing. Depending upon the
number of Shares purchased pursuant to the Offer, the Shares may
no longer meet the requirements for continued listing on the
NYSE. According to the published NYSE guidelines, the NYSE would
consider delisting the Shares if, among other things, the number
of publicly held shares falls below 600,000, the total number of
holders of Shares falls below 400 or ICG’s average total
global market capitalization over a consecutive 30-trading day
period is less than $15 million. If, as a result of the
purchase of Shares pursuant to the Offer or otherwise, the
Shares no longer meet the requirements of the NYSE for continued
listing and the listing of the Shares is discontinued, the
market for the Shares could be adversely affected.
If the NYSE were to delist the Shares (which we intend to cause
ICG to seek if we acquire control of ICG and the Shares no
longer meet the NYSE listing requirements), it is possible that
the Shares would trade on another securities exchange or in the
over-the-counter
market and that price quotations for the Shares would be
reported by such exchange or through other sources. The extent
of the public market for the Shares and availability of such
quotations would, however, depend upon such factors as the
number of holders of Shares, the aggregate market value of the
publicly-held Shares at such time, the interest in maintaining a
market in the 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.
Registration under the Exchange Act. The
Shares are currently registered under the Exchange Act. The
purchase of the Shares pursuant to the Offer may result in the
Shares becoming eligible for deregistration under the Exchange
Act. Registration may be terminated upon application of ICG to
the SEC if the Shares are neither listed on a national
securities exchange nor held by 300 or more holders of record.
Termination of the registration of the Shares under the Exchange
Act, assuming there are no other remaining public reporting
requirements applicable to ICG, would substantially reduce the
information required to be furnished by ICG to holders of Shares
and to the SEC and would make certain of the provisions of the
Exchange Act, such as the short-swing profit recovery provisions
of Section 16(b), the requirement to furnish a proxy
statement pursuant to Section 14(a) in connection with a
stockholders’ meeting and the related requirement to
furnish an annual report to stockholders and the requirements of
Rule 13e-3
under the Exchange Act with respect to “going private”
transactions, no longer applicable to ICG. Furthermore,
“affiliates” of ICG and persons holding
“restricted securities” of ICG may be deprived of the
ability to dispose of such securities pursuant to Rule 144
promulgated under the Securities Act of 1933, as amended. If
registration of the Shares under the Exchange Act were
terminated, the Shares would no longer be “margin
securities” or eligible for stock exchange listing. We
believe that the purchase of the Shares pursuant to the Offer
may result in the Shares becoming eligible for deregistration
under the Exchange Act, and it would be our intention to cause
ICG to terminate registration of the Shares under the Exchange
Act as soon after consummation of the Offer as the requirements
for termination of registration of the Shares are met.
If registration of the Shares under the Exchange Act is not
terminated prior to the Merger, then the registration of the
Shares under the Exchange Act and the listing of the Shares on
the NYSE will be terminated following the completion of the
Merger.
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Margin Regulations. The Shares are currently
“margin securities” under the regulations of the Board
of Governors of the Federal Reserve System (the “Federal
Reserve Board”), which has the effect, among other
things, of allowing brokers to extend credit on the collateral
of such Shares. Depending upon factors similar to those
described above regarding listing and market quotations,
following the purchase of Shares pursuant to the Offer the
Shares might no longer constitute “margin securities”
for the purposes of the Federal Reserve Board’s margin
regulations and, therefore, could no longer be used as
collateral for loans made by brokers.
8. Certain Information Concerning
ICG. Except as specifically set forth herein,
the information concerning ICG contained in this Offer to
Purchase has been taken from or is based upon information
furnished by ICG or its representatives or upon publicly
available documents and records on file with the SEC. None of
Arch, Merger Sub or any of their respective affiliates or
assigns, the Depositary, the Dealer Manager or the Information
Agent take responsibility for the accuracy or completeness of
the information contained in such documents and records or for
any failure by ICG to disclose events which may have occurred or
may affect the significance or accuracy of any such information
but which are unknown to Arch, Merger Sub or any of their
respective affiliates or assigns, the Depositary, the Dealer
Manager or the Information Agent. See
Section 13 — “The Transaction
Documents — Offer Documents” of this Offer to
Purchase. The summary information set forth below is qualified
in its entirety by reference to ICG’s public filings with
the SEC (which may be obtained and inspected as described below)
and should be considered in conjunction with the more
comprehensive financial and other information in such reports
and other publicly available information.
ICG is a Delaware corporation incorporated in 2005 with
principal executive offices at 300 Corporate Centre Drive, Scott
Depot, West Virginia 25560. As set forth in ICG’s public
filings, ICG is a leading producer of coal in Northern and
Central Appalachia with a broad range of mid- to
high-Btu,
low- to medium-sulfur steam and metallurgical coal. ICG has
twelve Appalachian mining complexes, which are located across
West Virginia, Kentucky, Virginia and Maryland. ICG also has a
complementary mining complex of mid- to high-sulfur steam coal
located in the Illinois Basin. ICG markets its coal to a diverse
customer base of electric utilities, as well as domestic and
international industrial customers.
Additional Information. The Shares are
registered under the Exchange Act. Accordingly, ICG is subject
to the information reporting requirements of the Exchange Act
and, in accordance therewith, is required to file periodic
reports, proxy statements and other information with the SEC
relating to its business, financial condition and other matters.
Information as of particular dates concerning ICG’s
directors and officers, their remuneration, stock options and
other equity awards granted to them, the principal holders of
ICG’s securities, any material interests of such persons in
transactions with ICG and other matters is required to be
disclosed in proxy statements, the last one having been filed
with the SEC on April 15, 2011 and distributed to
ICG’s stockholders. Such information also will be available
in ICG’s Solicitation/Recommendation Statement on
Schedule 14D-9
(together with any amendments, supplements and exhibits thereto,
the
“Schedule 14D-9”)
and the Information Statement annexed thereto. Such reports,
proxy statements and other information are available for
inspection at the SEC’s Public Reference Room at 100 F
Street, N.E., Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330
for further information on the public reference room. Copies of
such information may be obtained by mail, upon payment of the
SEC’s customary charges, by writing to the SEC at 100 F
Street, N.E., Washington, D.C.
20549-0213.
The SEC also maintains a web site on the Internet at
http://www.sec.gov
that contains reports, proxy statements and other information
regarding registrants, including ICG, that file electronically
with the SEC.
ICG Financial Forecasts. In connection with
Arch’s due diligence review, ICG provided to Arch certain
projected financial information concerning ICG in February 2011.
Although Arch was provided with these projections, it did not
base its evaluation of ICG on these projections. None of Arch or
any of its affiliates or representatives participated in
preparing, and they do not express any view on, the projections
summarized below, or the assumptions underlying such
information. The summary of the ICG projections is not included
in this Offer to Purchase in order to influence any ICG
stockholder to make any investment decision with respect to the
Offer or the Merger, including whether to tender Shares in the
Offer or whether or not to seek appraisal rights with respect to
the Shares.
20
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ICG has advised us that ICG’s management prepares forecasts
of its prospective financial performance for internal use as
part of its ongoing management of the company. ICG has also
advised us that ICG does not as a matter of course make public
forecasts as to future performance, earnings or other results
beyond the current fiscal year due to the unpredictability of
the underlying assumptions and estimates.
In the fall of 2010, as part of its annual business planning
process, management of ICG prepared forecasts for 2011 and the
following five years that were reviewed by the board of
directors of ICG in early December (the “December
Forecast”). The revenue portion of the December
Forecast was updated by management of ICG in February 2011 to
reflect the sudden and significant increase in metallurgical
coal prices that occurred after the December Forecast was
prepared (the “February Forecast” and
collectively with the December Forecast, the
“Forecasts”).
ICG has advised us that the Forecasts were not prepared with a
view toward public disclosure; and, accordingly, do not
necessarily comply with published guidelines of the SEC, the
guidelines established by the American Institute of Certified
Public Accountants for preparation and presentation of financial
forecasts, or generally accepted accounting principles. We have
been advised that Deloitte & Touche, LLP, ICG’s
independent registered public accounting firm, has not audited,
compiled or performed any procedures with respect to the
Forecasts and does not express an opinion or any form of
assurance related thereto. The summary of the Forecasts is not
being included in this Offer to Purchase to influence a
stockholder’s decision whether to tender Shares in the
Offer, but is being included because the Forecasts were made
available by ICG to Arch, Merger Sub and their advisors.
The Forecasts, while presented with numerical specificity,
necessarily were based on numerous variables and assumptions
that are inherently uncertain and many of which are beyond the
control of ICG’s management. Because the Forecasts cover
multiple years, by their nature, they become subject to greater
uncertainty with each successive year. The assumptions upon
which the Forecasts were based necessarily involve judgments
with respect to, among other things, future economic,
competitive and financial market conditions, all of which are
difficult or impossible to predict accurately and many of which
are beyond ICG’s control. The Forecasts also reflect
assumptions as to certain business decisions that are subject to
change. In addition, the Forecasts may be affected by ICG’s
ability to achieve strategic goals, objectives and targets over
the applicable periods.
Accordingly, there can be no assurance that the Forecasts will
be realized, and actual results may vary materially from those
shown. The inclusion of the Forecasts in this Offer to Purchase
should not be regarded as an indication that Arch, Merger Sub,
ICG or any of their respective officers, directors, advisors or
representatives considered or consider the Forecasts to be
predictive of actual future events, and the Forecasts should not
be relied upon as such. Neither Arch, Merger Sub or ICG nor any
of their respective officers, directors, advisors or
representatives can give any assurance that actual results will
not differ from the Forecasts, and none of them undertakes any
obligation to update or otherwise revise or reconcile the
Forecasts to reflect circumstances existing after the date the
Forecasts were generated or to reflect the occurrence of future
events even in the event that any or all of the assumptions
underlying the Forecasts are shown to be in error. ICG has
advised us that it does not intend to make publicly available
any update or other revision to the Forecasts, except as
otherwise required by law or as provided in the
Schedule 14D-9.
Neither Arch, Merger Sub or ICG nor any of their respective
affiliates, advisors, officers, directors or representatives has
made or makes any representation to any stockholder of ICG or
other person regarding the ultimate performance of ICG compared
to the information contained in the Forecasts or that the
Forecasts will be achieved. ICG has made no representation to
Arch, Merger Sub or their affiliates, in the Merger Agreement or
otherwise, concerning the Forecasts.
In light of the foregoing factors and the uncertainties
inherent in the Forecasts, stockholders of ICG are cautioned not
to place undue, if any, reliance on the Forecasts.
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The following tables summarize the Forecasts:
December
Forecast
| Year Ending December 31, | ||||||||||||||||||||||||
| 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | |||||||||||||||||||
| (Dollars in millions) | ||||||||||||||||||||||||
|
Total Revenue
|
$ | 1,278 | $ | 1,406 | $ | 1,576 | $ | 1,872 | $ | 2,048 | $ | 2,129 | ||||||||||||
|
Adjusted EBITDA(1)
|
257 | 312 | 365 | 574 | 693 | 711 | ||||||||||||||||||
|
Capital Expenditures
|
230 | 241 | 204 | 198 | 196 | 117 | ||||||||||||||||||
|
Operating Statistics
|
||||||||||||||||||||||||
|
Total Tons Sold (mm)
|
16.5 | 17.0 | 18.8 | 21.0 | 22.1 | 22.3 | ||||||||||||||||||
|
Total Average Price per Ton ($)
|
72.78 | 78.03 | 80.16 | 85.88 | 90.02 | 92.89 | ||||||||||||||||||
|
Total Cost per Ton ($)
|
$ | 55.88 | $ | 58.48 | $ | 59.10 | $ | 56.97 | $ | 56.98 | $ | 59.25 | ||||||||||||
February
Forecast
| Year Ending December 31, | ||||||||||||||||||||||||
| 2011 | 2012 | 2013 | 2014 | 2015 | 2016 | |||||||||||||||||||
| (Dollars in millions) | ||||||||||||||||||||||||
|
Total Revenue
|
$ | 1,352 | $ | 1,573 | $ | 1,756 | $ | 2,071 | $ | 2,287 | $ | 2,354 | ||||||||||||
|
Adjusted EBITDA(1)
|
323 | 453 | 513 | 746 | 886 | 912 | ||||||||||||||||||
|
Capital Expenditures
|
242 | 249 | 206 | 199 | 197 | 118 | ||||||||||||||||||
|
Operating Statistics
|
||||||||||||||||||||||||
|
Total Tons Sold (mm)
|
16.6 | 17.3 | 19.1 | 21.4 | 22.5 | 22.7 | ||||||||||||||||||
|
Total Average Price per Ton ($)
|
76.55 | 86.50 | 88.10 | 93.68 | 98.26 | 101.35 | ||||||||||||||||||
|
Total Cost per Ton ($)
|
$ | 55.90 | $ | 59.13 | $ | 59.71 | $ | 57.20 | $ | 57.18 | $ | 59.39 | ||||||||||||
| (1) | Adjusted EBITDA is a non-GAAP measure and is used by the ICG’s management to measure the operating performance of the business. ICG defines Adjusted EBITDA as net income or loss attributable to ICG before deducting interest, income taxes, depreciation, depletion, amortization, reserve for the Allegheny Energy Supply lawsuit, loss on extinguishment of debt and noncontrolling interest. ICG also uses Adjusted EBITDA (with additional adjustments) to measure compliance with covenants in the ICG’s credit facility, such as the fixed charge ratio. We have been advised that management of ICG believes Adjusted EBITDA is a useful measure as it is frequently used by securities analysts, investors and other interested parties in the evaluation of companies in ICG’s industry, substantially all of which present EBITDA or Adjusted EBITDA when reporting their results. The non-GAAP measures have not been reconciled to the comparable GAAP measures because not all of the information necessary for a quantitative reconciliation of these non-GAAP financial measures to the most directly comparable GAAP financial measures is available without unreasonable effort. |
According to ICG, the material assumptions underlying the
Forecasts were:
| • | The Total Tons Sold are the amounts shown above in the Forecasts. | |
| • | The Total Tons Sold included in the December Forecast are slightly lower than in the February Forecast. | |
| • | The Total Average Price per Ton was higher in the February Forecast, after taking into consideration a sudden and significant increase in the price of metallurgical coal after the time that the December Forecast was prepared. | |
| • | The global economic recovery will continue to result in generally increasing Average Price per Ton based on generally good market conditions. | |
| • | Margins were assumed to increase as a result of increased sales of metallurgical coal. |
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| • | ICG’s new Tygart Valley mine development would have initial production commencing in late 2011 ramping up to 3.0 million tons in 2014 with full output of 3.5 million tons beginning in 2015. Assumed product mix of the output of that development is 40% metallurgical coal and 60% thermal coal. | |
| • | Production increases each year by reason of organic growth and no significant acquisitions or divestitures. | |
| • | The possible outcome of pending litigation against ICG. | |
| • | General commodities inflation at 3% per year. | |
| • | No significant restructuring or impairment costs. | |
| • | No non-recurring expenses. |
In light of the foregoing factors and the uncertainties
inherent in the Forecasts, stockholders of ICG are cautioned not
to place undue, if any, reliance on the Forecasts.
9. Certain Information Concerning
Arch and Merger Sub. Arch is a Delaware
corporation incorporated in 1969 as Arch Mineral Corporation,
with principal executive offices at One CityPlace Drive,
Suite 300, St. Louis, Missouri 63141. The telephone number
at the principal executive offices is
(314) 994-2700.
Arch is one of the world’s largest coal producers, with
more than 160 million tons of coal sold in 2010.
Arch’s national network of mines supplies cleaner-burning,
low-sulfur coal to customers on four continents, including U.S.
and international power producers and steel manufacturers.
Merger Sub is a Delaware corporation and a wholly owned
subsidiary of Arch. Merger Sub was organized by Arch to acquire
ICG and has not conducted any unrelated activities since its
organization. All outstanding shares of the capital stock of
Merger Sub are wholly owned by Arch.
The name, business address, current principal occupation or
employment, five-year employment history and citizenship of each
director and executive officer of Arch and Merger Sub and
certain other information are set forth on Schedule I to
this Offer to Purchase.
Except as described elsewhere in this Offer to Purchase or in
Schedule I hereto, (i) none of Arch, Merger Sub or, to
the best knowledge of Arch and Merger Sub after reasonable
inquiry, any of the persons listed in Schedule I hereto or
any associate or majority owned subsidiary of Arch, Merger Sub
or of any of the persons so listed, beneficially owns or has a
right to acquire any Shares or any other equity securities of
ICG; (ii) none of Arch, Merger Sub or, to the best
knowledge of Arch and Merger Sub after reasonable inquiry, the
persons or entities referred to in clause (i) above has
effected any transaction in the Shares or any other equity
securities of ICG during the past 60 days; (iii) none
of Arch, Merger Sub or, to the best knowledge of Arch and Merger
Sub after reasonable inquiry, the persons listed in
Schedule I to this Offer to Purchase has any contract,
arrangement, understanding or relationship with any other person
with respect to any securities of ICG (including, but not
limited to, any contract, arrangement, understanding or
relationship concerning the transfer or the voting of any such
securities, joint ventures, loan or option arrangements, puts or
calls, guaranties of loans, guaranties against loss or the
giving or withholding of proxies, consents or authorizations);
(iv) during the two years prior to the date of this Offer
to Purchase, there have been no transactions between Arch,
Merger Sub, their subsidiaries or, to the best knowledge of Arch
and Merger Sub after reasonable inquiry, any of the persons
listed in Schedule I to this Offer to Purchase, on the one
hand, and ICG or any of its executive officers, directors or
affiliates, on the other hand, that would require reporting
under SEC rules and regulations; (v) during the two years
prior to the date of this Offer to Purchase, there have been no
contacts, negotiations or transactions between Arch, Merger Sub,
their subsidiaries or, to the best knowledge of Arch and Merger
Sub after reasonable inquiry, any of the persons listed in
Schedule I to this Offer to Purchase, on the one hand, and
ICG or any of its subsidiaries or affiliates, on the other hand,
concerning a merger, consolidation or acquisition, a tender
offer or other acquisition of securities, an election of
directors or a sale or other transfer of a material amount of
assets; (vi) none of Arch, Merger Sub or, to the best
knowledge of Arch and Merger Sub after reasonable inquiry, the
persons listed in Schedule I to this Offer to Purchase has
been convicted in a criminal proceeding during the five years
prior to the date of this Offer to Purchase (excluding traffic
violations or similar misdemeanors) and (vii) none of Arch,
Merger Sub or, to the
23
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best knowledge of Arch and Merger Sub after reasonable inquiry,
the persons listed in Schedule I to this Offer to Purchase
has been a party to any judicial or administrative proceeding
during the five years prior to the date of this Offer to
Purchase that resulted in a judgment, decree or final order
enjoining that person from future violations of, or prohibiting
activities subject to, federal or state securities laws or a
finding of any violation of federal or state securities laws.
We do not believe our financial condition or the financial
condition of Arch is relevant to your decision whether to tender
your Shares and accept the Offer because (i) the Offer is
being made for all outstanding Shares solely for cash,
(ii) the consummation of the Offer is not subject to any
financing condition, (iii) if we consummate the Offer, we
expect to acquire all remaining Shares for the same cash price
in the Merger and (iv) Arch will have, and will arrange for
us to have, sufficient funds to purchase all Shares validly
tendered and not properly withdrawn in the Offer and to acquire
the remaining outstanding Shares in the Merger.
Additional Information. Pursuant to
Rule 14d-3
under the Exchange Act, we have filed with the SEC a Tender
Offer Statement on Schedule TO (the
“Schedule TO”), of which this Offer to
Purchase forms a part, and exhibits to the Schedule TO. The
Schedule TO and the exhibits thereto, as well as other
information filed by Arch with the SEC, are available for
inspection at the SEC’s Public Reference Room at 100 F
Street, N.E., Washington, D.C. 20549. Please call the SEC at
1-800-SEC-0330
for further information on the public reference room. Copies of
such information may be obtained by mail, upon payment of the
SEC’s customary charges, by writing to the SEC at 100 F
Street, N.E., Washington, D.C.
20549-0213.
The SEC also maintains a web site on the Internet at
http://www.sec.gov
that contains the Schedule TO and the exhibits thereto and
other information that Arch has filed electronically with the
SEC.
We estimate that the total amount of funds necessary to purchase
all of the Shares pursuant to the Offer and to consummate the
other transactions contemplated by the Merger Agreement,
including making payments in respect of outstanding ICG
compensatory awards, paying the merger consideration in
connection with the Merger of us into ICG, which is expected to
follow the successful completion of the Offer, redeeming or
repaying certain outstanding indebtedness of ICG and paying
related fees and expenses will be approximately
$3.8 billion. The majority of the approximately
$3.8 billion is expected to come from the issuance of
unsecured senior notes by Arch (the “Notes”),
either by private placement or an underwritten public sale, with
the balance to be paid using the proceeds of additional common
shares to be issued by Arch (the “Arch Shares”)
or other additional senior secured indebtedness (the
“Loans”) to be raised by Arch. To the extent
that Arch is unable to issue the Notes, Shares and Loans for the
entire $3.8 billion amount, Arch has a commitment from
Morgan Stanley Senior Funding, Inc. and PNC Bank, National
Association, to provide, or cause their respective affiliates to
provide, $3.8 billion of senior unsecured bridge loans to
Arch (the “Bridge Facility”), the proceeds of
which will be used (i) first, to repay or redeem ICG’s
indebtedness outstanding on the date of consummation of the
Merger, other than certain existing indebtedness, including
certain equipment notes and capital leases, and
(ii) second, to fund in part the cash consideration for the
Offer and the Merger and pay certain fees and expenses in
connection with the Offer and the Merger. The Bridge Facility
will mature on the first anniversary of the closing of the
Merger; however, subject to certain conditions, Arch may elect
to extend the maturity date of the Bridge Facility to the eighth
anniversary of the closing of the Merger. There is no financing
condition to the Offer.
As part of its ongoing evaluation of Arch’s business and
strategic direction, our Board of Directors and senior members
of our management have from time to time evaluated strategic
alternatives and prospects for acquisitions.
On February 4, 2011, John W. Eaves, the President and Chief
Operating Officer of Arch, received a call from Bennett K.
Hatfield, the President and Chief Executive Officer of ICG, to
discuss a possible transaction between Arch and ICG.
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Table of Contents
On February 24, 2011, the Board of Directors of Arch held a
regularly scheduled meeting at which Steven F. Leer, the
Chairman and Chief Executive Officer of Arch, discussed the
potential acquisition of ICG, and the board authorized
management of Arch to proceed with exploratory discussions.
To facilitate the exchange of confidential information in
contemplation of a possible transaction, ICG entered into a
confidentiality agreement with Arch dated February 25, 2011.
On March 1, 2011, members of Arch management met with
members of ICG management to discuss a potential transaction and
review ICG’s operations and prospects.
On March 11, 2011, Mr. Eaves called Mr. Hatfield
to communicate a preliminary expression of interest in a
business transaction with ICG. Mr. Eaves indicated that
Arch’s model supported a 20% premium to recent ICG trading
prices, which implied a price of approximately $12 per share. He
indicated that he expected that Arch would propose a combination
involving Arch stock and cash, with the cash component
representing between 25% and 35% of the total consideration and
that this indication was preliminary and subject to final
approval by the Arch Board of Directors.
On March 15, 2011, ICG and Arch entered into a standstill
agreement that, among other things, prohibited either party from
initiating an unsolicited offer to acquire the other
party’s stock or solicit proxies with respect to the other
party’s voting securities.
Also on March 15, 2011, senior executives of Arch and
senior executives of ICG held a meeting at which the parties
discussed a potential transaction and ICG made presentations to
Arch regarding ICG’s operations and sales.
On March 28, 2011, Arch submitted to ICG a non-binding
indication of interest to acquire all of ICG’s outstanding
common stock at a price of $12.25 per share, to be paid 50% in
cash and 50% in shares of Arch common stock. Arch’s
indication of interest was subject to, among other things,
Arch’s further due diligence, the negotiation of a
definitive acquisition agreement and the approval of Arch’s
Board of Directors.
Also on March 28, 2011, Arch determined to engage Morgan
Stanley & Co. Incorporated (“Morgan
Stanley”) as its financial advisor to assist it in
exploring a possible business combination with ICG.
On March 30, 2011, Mr. Leer contacted Wilbur L. Ross,
Jr., Chairman of the Board of Directors of ICG, to discuss the
non-binding indication of interest previously sent by Arch.
Mr. Ross informed Mr. Leer that ICG management would
be reviewing the proposal with ICG’s Board of Directors.
On April 1, 2011, Mr. Hatfield informed Mr. Eaves
that the Board of Directors of ICG had concluded that
Arch’s proposal of $12.25 per share was deficient and that
Arch would need to improve its offer in order for the two
parties to continue discussions regarding a potential
transaction. Mr. Eaves agreed that Arch management would
revisit the assumptions underlying its proposal and discuss with
the Board of Directors of Arch whether it would be possible to
increase the offer price.
On April 5 and 13, 2011, representatives of ICG’s
management team held a series of due diligence sessions with
executives of Arch. In addition, on April 7, 2011, Arch and
its financial and legal advisors were granted access to a
virtual data room containing certain information about ICG.
Beginning on April 7, 2011, representatives of ICG provided
more detailed information to Arch and its representatives
regarding ICG’s business, and Arch and its advisors
conducted a more extensive due diligence investigation of ICG,
including tours of ICG mining sites on April 22, 25 and 26,
2011. During this period, Arch’s Board of Directors was
periodically updated on the status of the proposed ICG
transaction.
Following several telephone conversations between
representatives of Morgan Stanley and UBS Securities LLC,
ICG’s financial advisor (“UBS”), on
April 18, 2011, Arch submitted to ICG a revised non-binding
indication of interest to acquire all of ICG’s common stock
at a price of $13.25 to $14.00 per share in cash. Arch’s
indication of interest remained subject to the completion of due
diligence, the negotiation of a definitive acquisition agreement
and the approval of Arch’s Board of Directors but indicated
that Arch was prepared to move quickly to complete due diligence
and negotiate a definitive agreement.
On April 20, 2011, ICG provided a draft merger agreement to
Arch and its outside counsel at Simpson Thacher &
Bartlett LLP (“Simpson Thacher”).
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On April 27 and 28, 2011, Arch’s Board of Directors held a
regularly scheduled meeting at which it reviewed and considered
the potential transaction with ICG. At the meeting, members of
Arch’s senior management provided the directors with an
overview of the proposed transaction, including the material
terms thereof and a summary of Arch’s due diligence review
of ICG from an operational, financial and legal perspective. A
representative of Simpson Thacher discussed with the directors
certain material terms of the merger agreement which had been
previously provided by ICG and reviewed with the directors their
fiduciary duties under applicable law. Representatives from
Morgan Stanley reviewed with the directors certain financial
aspects of the proposed transaction. Following consideration of
the terms of the proposed transaction and discussion among the
directors, senior management and Arch’s legal and financial
advisors, Arch’s Board of Directors authorized Arch’s
management to proceed with an offer of $13.90 per share in cash.
On April 28, 2011, Arch submitted to ICG a further revised
proposal to acquire all of ICG’s common stock at a price of
$13.90 per share in cash by means of a tender offer followed by
a second-step merger, which was expressly not subject to a
financing condition, together with a revised draft of the merger
agreement that had previously been provided by ICG. The letter
specified that Arch had completed its due diligence review and
was prepared to sign and announce a transaction immediately.
On April 29, 2011, representatives of Simpson Thacher and
Jones Day, ICG’s outside legal counsel, discussed certain
issues raised by the revised draft of the merger agreement.
During this discussion, Simpson Thacher advised Jones Day that
Arch was requesting that the two ICG stockholders with
representatives on ICG’s Board of Directors execute a
tender and voting agreement in connection with the transaction.
On April 30, 2011, Simpson Thacher delivered a further
revised draft of the merger agreement to Jones Day reflecting a
tender offer transaction structure and a draft of the proposed
tender and voting agreement and continued negotiating the merger
agreement and the tender and voting agreement with
representatives of Jones Day.
On May 1, 2011, representatives of Jones Day delivered a
revised draft of the merger agreement and tender and voting
agreement to representatives of Simpson Thacher. Over the course
of that day, representatives of Simpson Thacher and Jones Day
engaged in numerous discussions to resolve as many of the open
items as possible in the draft merger agreement and tender and
voting agreement. At the conclusion of the day, the negotiation
of the definitive merger agreement and tender and voting
agreement was substantially complete.
Also on May 1, 2011, representatives of UBS informed Morgan
Stanley that Arch’s offer was insufficient and that Arch
would need to increase its offer in order to be competitive. In
the evening of May 1, 2011, Arch submitted a revised, final
offer to purchase all of the outstanding shares of ICG at a
price of $14.60 per share and conveyed both that this was its
best and final offer and that it was conditioned on acceptance
by midnight. Following the submission, Arch’s Board of
Directors conducted a special telephonic meeting regarding the
proposed transaction at which representatives of Simpson Thacher
and Morgan Stanley presented certain revised terms of the
transaction. Following consideration of the terms of the
proposed merger agreement and the tender and voting agreement
and the transactions contemplated thereby and discussion among
the directors, senior management and Arch’s legal and
financial advisors, Arch’s Board of Directors determined
that the terms of the Merger Agreement and the transactions
contemplated thereby, are advisable and fair to, and in the best
interests of, Arch and its stockholders, and authorized the
execution of the Merger Agreement.
The Merger Agreement and the Tender and Voting Agreements were
signed in the early morning of May 2, 2011, and the
proposed transaction was publicly announced on the morning of
May 2, 2011 prior to the opening of trading on the NYSE.
Purpose of the Offer; Plans for ICG. The
purpose of the Offer and the Merger is to acquire control of,
and the entire equity interest in, ICG. The Offer, as the first
step in the acquisition of ICG, is intended to facilitate the
acquisition of all of the Shares. The purpose of the Merger is
to acquire all capital stock of ICG not purchased pursuant to
the Offer or otherwise.
Upon the purchase of Shares pursuant to the Offer, the Merger
Agreement provides that Merger Sub will be entitled to elect or
designate a number of directors to the ICG Board, rounded up to
the next whole
26
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number, that is equal to the product of the total number of
directors on the ICG Board (including those elected or
designated by Merger Sub) multiplied by the percentage of the
total number of Shares then outstanding that Arch and Merger Sub
beneficially own in the aggregate; provided, however,
that subject to applicable law and rules of the NYSE, Merger Sub
is entitled to designate at least a majority of the directors on
the ICG Board at all times following the Appointment Time. Upon
Merger Sub’s request at any time following the Appointment
Time, ICG has agreed to take such actions as are reasonably
necessary to enable Merger Sub’s designees to be so elected
or designated to the ICG Board, and to cause Merger Sub’s
designees to be so elected or designated at such time. Merger
Sub currently intends, promptly after consummation of the Offer,
to exercise this right and to designate officers or employees of
Arch or an affiliate of Arch to serve as directors of ICG. We
expect that such representation on the ICG Board would permit us
to exert substantial influence over ICG’s conduct of its
business and operations. In addition, if we accept for payment
and pay for at least a majority of the outstanding Shares, we
expect to merge with and into ICG. We currently intend, as soon
as possible after consummation of the Offer, to consummate the
Merger pursuant to the Merger Agreement. Following the Merger,
the directors of Merger Sub will be the directors of ICG. See
Section 13 — “The Transaction
Documents — The Merger Agreement.”
Pursuant to the Merger Agreement, following our acceptance for
payment of the Shares pursuant to the Offer, we have the option
to purchase from ICG, subject to certain limitations, up to a
number of additional Shares sufficient to cause Arch and Merger
Sub to own one Share more than 90% of the outstanding Shares
immediately following such issuance (on a fully diluted basis).
We intend to exercise this option if it is exercisable and
necessary in order for us to be able to effect a “short
form” merger under Delaware law. See
Section 13 — “The Transaction
Documents — The Merger Agreement —
Top-Up
Option.”
Under the terms of the Merger Agreement, if Merger Sub acquires
at least 90% of the total outstanding Shares, Arch and Merger
Sub will act to effect the Merger under the
“short-form” merger provisions of Section 253 of
the DGCL. See Section 13 — “The Transaction
Documents — The Merger Agreement —
Short-Form Merger Procedure.”
Under the terms of the Merger Agreement, at the Effective Time,
the certificate of incorporation of ICG will be amended and
restated so as to read in the form attached to the Merger
Agreement, and as so amended will be the certificate of
incorporation of the surviving corporation in the Merger until
thereafter amended in accordance with applicable law. The bylaws
of Merger Sub, as in effect immediately prior to the Effective
Time, will be the bylaws of the surviving corporation in the
Merger until thereafter amended in accordance with applicable
law. See Section 13 — “The Transaction
Documents — The Merger Agreement —
Certificate of Incorporation and Bylaws, Directors and
Officers.”
Based on available information, we are conducting a detailed
review of ICG and its assets, corporate structure, dividend
policy, capitalization, indebtedness, operations, properties,
policies, management, personnel and any obligations to report
under Section 15(d) of the Exchange Act and will consider
what, if any, changes would be desirable in light of the
circumstances which exist upon completion of the Offer. We will
continue to evaluate the business and operations of ICG during
the pendency of the Offer and after the consummation of the
Offer and will take such actions as we deem appropriate under
the circumstances then existing. Thereafter, we intend to review
such information as part of a comprehensive review of ICG’s
business, operations, capitalization and management with a view
to optimizing development of ICG’s potential in conjunction
with Arch’s existing businesses. Possible changes could
include changes in ICG’s business, corporate structure,
charter, bylaws, capitalization, board of directors, management,
indebtedness or dividend policy, and although, except as
disclosed in this Offer to Purchase, we have no current plans
with respect to any of such matters. Arch, Merger Sub and the
surviving corporation in the Merger expressly reserve the right
to make any changes they deem appropriate in light of such
evaluation and review or in light of future developments.
If we acquire Shares pursuant to the Offer and depending upon
the number of Shares so acquired and other factors relevant to
our equity ownership in ICG, Arch and Merger Sub reserve the
right to acquire additional Shares through private purchases,
market transactions, tender or exchange offers or otherwise on
terms and at prices that may be more or less favorable than
those of the Offer, or, subject to any applicable legal
restrictions, to dispose of any or all Shares acquired by them.
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Appraisal Rights. No appraisal rights are
available to the holders of Shares in connection with the Offer.
However, if the Merger is consummated, each holder of Shares at
the Effective Time who has neither voted in favor of the Merger
nor consented thereto in writing, and who otherwise complies
with the applicable statutory procedures under Section 262
of the DGCL, will be entitled to receive a judicial
determination of the fair value of the holder’s Shares
(exclusive of any element of value arising from the
accomplishment or expectation of the Merger) and to receive
payment of such judicially determined amount in cash, together
with such rate of interest, if any, as the Delaware court may
determine for Shares held by such holder.
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 market value of the Shares.
Holders of Shares should recognize that the value so determined
could be higher or lower than the price per Share paid pursuant
to the Offer or the per share price to be paid in the Merger.
Moreover, we may argue in an appraisal proceeding that, for
purposes of such a proceeding, the fair value of the Shares is
less than the price paid in the Offer and the Merger.
For the avoidance of doubt, Arch, Merger Sub and ICG have agreed
and acknowledged that, in any appraisal proceeding described
herein and to the fullest extent permitted by applicable law,
the fair value of the Shares subject to the appraisal proceeding
will be determined in accordance with Section 262 of the
DGCL without regard to the
Top-Up
Option (as defined below), the
Top-Up
Option Shares (as defined below) or any promissory note
delivered by Merger Sub to ICG in payment for
Top-Up
Option Shares.
The foregoing summary of the rights of dissenting stockholders
under the DGCL does not purport to be a statement of the
procedures to be followed by stockholders desiring to exercise
any appraisal rights under Delaware law. The preservation and
exercise of appraisal rights require strict and timely adherence
to the applicable provisions of Delaware law which will be set
forth in their entirety in the proxy statement or information
statement for the Merger, unless effected as a short-form
merger, in which case they will be set forth in the notice of
merger. The foregoing discussion is not a complete statement of
law pertaining to appraisal rights under Delaware law and is
qualified in its entirety by reference to Delaware law.
You cannot exercise appraisal rights at this time. The
information provided above is for informational purposes only
with respect to your alternatives if the Merger is consummated.
If you tender your Shares in the Offer, you will not be entitled
to exercise appraisal rights with respect to your Shares but,
rather, subject to the conditions to the Offer, will receive the
Offer Price therefor.
The Merger Agreement. The following summary
description of the Merger Agreement is qualified in its entirety
by reference to the Merger Agreement, a copy of which has filed
as an exhibit to the Schedule TO, which you may examine and
copy as set forth in Section 8 — “Certain
Information Concerning ICG” above. You are encouraged to
read the full text of the Merger Agreement because it is the
legal document that governs the Offer and the Merger. The
summary description has been included in this Offer to Purchase
to provide you with information regarding the terms of the
Merger Agreement and is not intended to modify or supplement any
factual disclosures about ICG or Arch in ICG’s or
Arch’s public reports filed with the SEC. In particular,
the Merger Agreement and this summary of terms are not intended
to be, and should not be seen as, disclosures regarding any
facts and circumstances relating to ICG or Arch. The
representations and warranties have been negotiated with the
principal purpose of (i) establishing the circumstances in
which Merger Sub may have the right not to consummate the Offer,
or a party may have the right to terminate the Merger Agreement,
if the representations and warranties of the other party prove
to be untrue due to a change in circumstance or otherwise and
(ii) allocating risk between the parties, rather than
establishing matters as facts. The representations and
warranties may also be subject to a contractual standard of
materiality different from those generally applicable under
federal securities laws.
The Offer. The Merger Agreement provides for
the commencement of the Offer by Merger Sub as promptly as
practicable, but in no event later than May 16, 2011. The
Merger Agreement provides that each ICG stockholder who tenders
Shares in the Offer will receive $14.60 for each Share tendered,
net to the stockholder in cash, without interest thereon and
less any applicable withholding taxes. Merger Sub’s
obligation to accept for payment and pay for Shares tendered
pursuant to the Offer is subject to the satisfaction
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of the Minimum Condition, the HSR Condition and the other
conditions set forth in Section 15 —
“Conditions to the Offer.” Arch and Merger Sub
expressly reserved the right to increase the Offer Price or to
make other changes to the terms and conditions of the Offer, and
to waive, in whole or in part, some of the conditions to the
Offer without the consent of ICG. Arch and Merger Sub cannot,
however, waive the Minimum Condition without the consent of ICG.
Merger Sub has agreed that, without the prior written consent of
ICG, it will not:
| • | decrease the Offer Price; | |
| • | change the form of consideration payable in the Offer; | |
| • | reduce the number of Shares to be purchased in the Offer; | |
| • | amend or modify any of the conditions to the Offer or impose conditions to the Offer that are different than or in addition to those set forth in Section 15 — “Conditions to the Offer;” | |
| • | amend or waive the Minimum Condition; | |
| • | amend or modify any of the terms of the Offer in a manner that is, or could reasonably be expected to be, adverse to the holders of Shares; or | |
| • | extend or otherwise change the Expiration Time in a manner other than pursuant to and in accordance with the Merger Agreement. |
Extensions of the Offer. Merger Sub will
(i) if any condition to the Offer is not satisfied or
waived at any scheduled Expiration Time, extend the Expiration
Time for an additional period or successive periods of up to
five business days (or such longer period as the parties may
agree) per extension until all of the conditions to the Offer
are satisfied or waived; (ii) extend the Offer for any
period required by any applicable law or any rule, regulation,
interpretation or position of the SEC (or its staff) or the
NYSE; (iii) if the marketing period for the financing of
the Offer (as set forth in Section 15 —
“Conditions to the Offer) has not ended on the last
business day prior to the scheduled expiration date of the
Offer, including following a prior extension, extend the Offer
until the earlier of (x) the first business day after the
final day of the marketing period for the financing of the Offer
or (y) any business day before or during the marketing
period as may be specified by Arch on no less than two business
days’ prior notice to ICG; and (iv) if at or prior to
any scheduled Expiration Time, the conditions to the Offer have
been satisfied or waived and Merger Sub has failed to accept for
payment and pay for Shares validly tendered, if requested by
ICG, extend the Offer for successive periods of up to five
business days until the Offer conditions are satisfied or
waived; provided, that Merger Sub will not be required to
extend the Offer beyond the Outside Date; provided,
further, that if at any scheduled Expiration Time each
condition to the Offer other than the Minimum Condition shall
have been satisfied, then Merger Sub may, and if requested by
ICG, Merger Sub shall, extend the Offer for an additional period
or successive periods of five business days, provided,
however, that the maximum number of days that the Offer may
be extended in this manner shall be twenty business days.
The Merger Agreement obligates Merger Sub, subject to applicable
securities laws to pay for all validly tendered and not properly
withdrawn shares of ICG common stock promptly after the later of
the Expiration Time and the satisfaction or waiver of the
conditions to the Offer set forth in Section 15 —
“Conditions to the Offer.”
Subsequent Offering Period. The Merger
Agreement provides that following the acceptance for payment of,
any payment for, all of the Shares properly tendered and not
withdrawn during the initial offering period (including any
extensions), if it is necessary or desirable to obtain
additional shares in order to effect a short-form merger under
Delaware law (which can be effected once we own at least 90% of
the outstanding shares), we may (but are not required to)
provide a subsequent offering period (and one or more extensions
thereof) of up to 20 business days, as determined in
consultation with ICG, in accordance with
Rule 14d-11
under the Exchange Act, during which time stockholders whose
Shares have not been accepted for payment may tender, but not
withdraw, their Shares and receive the offer consideration.
Directors. The Merger Agreement provides that
upon the Appointment Time, Merger Sub will be entitled to elect
or designate a number of directors, rounded up to the next whole
number, to the ICG Board that equals the product of (i) the
total number of directors on the ICG Board (giving effect to the
directors
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elected or designated by Merger Sub) and (ii) the
percentage of the total number of Shares then outstanding that
Arch and Merger Sub beneficially own in the aggregate,
provided, that, subject to applicable law and the rules
of the NYSE, Merger Sub will be entitled to designate at least a
majority of the directors on the ICG Board at all times
following the Appointment Time. ICG is required under the Merger
Agreement, upon Merger Sub’s request, to take such actions
as are reasonably necessary to enable Merger Sub’s
designees to be elected to the ICG Board, including by
increasing the size of the ICG Board (and amending ICG’s
bylaws if necessary so as to increase the size of the ICG Board)
and/or
requesting and accepting the resignations of incumbent directors
of ICG. Following the Appointment Time, ICG will also, upon
Merger Sub’s request, cause individuals elected or
designated by Merger Sub to constitute at least the same
percentage (rounded up to the next whole number) as is on the
ICG Board of (a) each committee of the ICG Board,
(b) each board of directors (or similar body) of each
subsidiary of ICG and (c) each committee (or similar body)
of each such board, in each case to the extent permitted by
applicable law and the listing standards of the NYSE.
Following the election or appointment of Merger Sub’s
designees and until the Effective Time, ICG will cause the ICG
Board to maintain three directors who were members of the ICG
Board on the date of the execution of the Merger Agreement,
(i) each of whom must be “independent” for
purposes of
Rule 10A-3
of the Exchange Act and also eligible to serve on ICG’s
audit committee under the Exchange Act and NYSE rules and
(ii) at least one of whom must be an “audit committee
financial expert” as defined in
Regulation S-K
and the instructions thereto (the “Continuing
Directors”). If, following the Appointment Time but
prior to the Effective Time, Merger Sub’s designees
constitute a majority of the ICG Board, then the affirmative
vote of a majority of the Continuing Directors will be required
to authorize:
| • | any amendment or termination of the Merger Agreement; | |
| • | any extension of time for performance, or any waiver, of any of the obligations or other acts of Arch or Merger Sub under the Merger Agreement; | |
| • | any exercise or waiver of ICG’s rights, benefits or remedies under the Merger Agreement; | |
| • | except as otherwise provided in the Merger Agreement, an amendment to ICG’s organizational documents; or | |
| • | any other action or any other determination of the ICG Board under or in connection with the Merger Agreement if such action would reasonably be expected to adversely affect the holders of Shares (other than Arch or Merger Sub). |
Top-Up
Option. As part of the Merger Agreement, ICG
granted to Merger Sub an irrevocable option to purchase up to a
number of Shares (the
“Top-Up
Option Shares”) from ICG at a per Share purchase price
equal to the Offer Price that, when added to the number of
Shares directly or indirectly owned by Arch, Merger Sub and
their respective subsidiaries at the time of exercise of the
Top-Up
Option, results in Arch, Merger Sub and their subsidiaries
owning one more Share than 90% of the Shares outstanding
immediately after the issuance of the
Top-Up
Option Shares on a fully diluted basis, provided that no
applicable law, order, injunction or other legal impediment will
prohibit such exercise. The
Top-Up
Option will not be exercisable to the extent (i) the
Short-Form Threshold would not be reached immediately after
such exercise and the issuance of Shares pursuant thereto or
(ii) the number of
Top-Up
Option Shares would exceed the number of Shares authorized but
unissued or held in the treasury of ICG at the time of exercise
of the
Top-Up
Option. The
Top-Up
Option may be exercised on one occasion, in whole and not in
part, after the Appointment Time and prior to the earlier to
occur of (i) later of (x) the Expiration Time and
(y) the expiration of any “subsequent offering
period,” and (ii) the termination of the Merger
Agreement.
The aggregate purchase price owed by Merger Sub for the
Top-Up
Option Shares would be paid, at Arch’s election, either
(i) entirely in cash or (ii) by (a) paying in
cash an amount equal to not less than the aggregate par value of
the Top-Up
Option Shares and (b) executing and delivering to ICG a
promissory note having a principal amount equal to the balance
of the aggregate purchase price pursuant to the
Top-Up
Option less the amount paid in cash. Any such promissory note
issued for the
Top-Up
Option Shares (i) will be full recourse against Arch and
Merger Sub, (ii) will bear interest at a rate of nine
percent per annum, (iii) will
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mature on the first anniversary of the date of execution and
delivery of such promissory note and (iv) may be prepaid,
in whole or in part, without premium or penalty.
The Merger. The Merger Agreement provides
that, within two business days of the satisfaction or waiver of
the conditions to the Merger, Merger Sub will be merged with and
into ICG. Following the Merger, the separate existence of Merger
Sub will cease, and ICG will continue as the surviving
corporation and a wholly owned subsidiary of Arch. ICG,
following the Merger, will continue to be governed by the DGCL.
Treatment
of Shares, Dissenting Shares
Shares. Under the terms of the Merger
Agreement, at the Effective Time, each Share issued and
outstanding immediately prior to the Effective Time will be
converted automatically into the right to receive a cash amount
equal to the Offer Price, without interest (the “Merger
Consideration”) less any required withholding taxes.
Notwithstanding the foregoing, the Merger Consideration will not
be payable in respect of (i) Shares owned by ICG,
(ii) Shares owned by Arch or Merger Sub, (iii) Shares
owned by any subsidiaries of Arch, Merger Sub or ICG or
(iv) Dissenting Shares (as defined below). Each Share held
by ICG, Arch or Merger Sub immediately prior to the Effective
Time will be cancelled and will cease to exist, and no
consideration will be paid with respect thereto.
Dissenting Shares. Shares that are issued and
outstanding immediately prior to the Effective Time and held by
a stockholder who did not vote in favor of the Merger (or
consent thereto in writing) and who is entitled to demand, and
who properly demands, appraisal for such Shares in accordance
with Section 262 of the DGCL (“Dissenting
Shares”) will not be converted into, or represent the
right to receive, the Merger Consideration, but rather such
stockholders will be entitled to receive payment of the
appraised value of such Dissenting Shares in accordance with the
provisions of Section 262 of the DGCL. However, all
Dissenting Shares held by stockholders who have failed to
perfect or who have otherwise waived, withdrawn or lost their
rights to appraisal of such Dissenting Shares under such
Section 262 of the DGCL will no longer be considered to be
Dissenting Shares and will thereupon be deemed to have been
converted into, and to have become exchangeable for, as of the
Effective Time, the right to receive the Merger Consideration.
Stockholders who tender their Shares in the Offer will not be
entitled to exercise appraisal rights with respect to such
Shares, but rather, subject to the conditions to the Offer, will
receive the Offer Price. See Section 12 —
“Purpose of the Offer; Plans for ICG; Appraisal
Rights — Appraisal Rights.”
Treatment
of Company Stock Options, Restricted Shares, Restricted Share
Units.
ICG Stock Options. The Merger Agreement
provides that each option (an “Option”) to
purchase shares granted under ICG’s Amended and Restated
2005 Equity and Performance Incentive Plan (the “ICG
Stock Plan”) that is outstanding and unexercised
(whether or not vested or exercisable) as of the Appointment
Time will be adjusted and converted into a right of each holder
to receive an amount equal to the product of (i) the total
number of Shares of ICG common stock previously subject to such
Option and (ii) the excess, if any, of the Offer Price over
the exercise price per share set forth in such Option less any
required withholding taxes. Payment in respect of such Options
shall be made promptly (and in any event within fifteen business
days) following the Appointment Time. Any Option for which the
Offer Price does not exceed the exercise price of the Option for
each Share subject to the Option will be canceled without any
consideration or payment made to the holder.
Restricted Shares, Restricted Share Units. The
Merger Agreement provides that each award of a right under the
ICG Stock Plan (other than Options) entitling the holder thereof
to Shares of ICG common stock or cash equal to or based on the
value of Shares of ICG common stock, including each Share of
restricted ICG common stock issued under the ICG Stock Plan
(each, a “Restricted Share”) and each
Restricted Share Unit under the ICG Stock Plan (each, a
“Restricted Share Unit”) that is outstanding or
payable as of the Appointment Time (collectively, the
“Share Units”) will be adjusted and converted
into a right of each holder to receive an amount in cash equal
to the product of (i) the total number of Shares of ICG
common stock underlying such Share Units and (ii) the
Merger Consideration, less any required withholding Taxes.
Payment in respect of such Share Units shall be made promptly
(and in any event within fifteen business days)
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following the Appointment Time, provided that all amounts
payable with respect to any Share Units will be paid in
accordance with the ICG Stock Plan subject to limited exceptions
required by law or payment elections under the ICG Stock Plan.
Short-Form Merger
Procedure. Section 253 of the DGCL provides
that if a parent company owns at least 90% of each class of
stock of a subsidiary, the parent company can effect a
“short-form” merger with that subsidiary without the
action of the other stockholders of the subsidiary. Under the
terms of the Merger Agreement, if Arch, Merger Sub or any of
their respective subsidiaries hold, in the aggregate, a number
of Shares equal to or greater than the 90% of the outstanding
Shares, then ICG, Arch and Merger Sub will take all necessary
and appropriate action to cause the Merger to become effective
promptly, without a meeting of the stockholders of ICG, in
accordance with Section 253 of the DGCL.
Vote Required to Approve Merger; Stockholders
Meeting. If the Short-Form Threshold is not
met, then, under the DGCL, the affirmative vote of the holders
of at least a majority of the outstanding Shares is required to
adopt the Merger Agreement. The Merger Agreement provides that
if ICG stockholder adoption is required, ICG will:
| • | as promptly as practicable following the Appointment Time, prepare and file with the SEC a proxy statement (the “ICG Proxy Statement”) relating to the ICG Stockholders Meeting (as defined below), which will include recommendation of the ICG Board that the stockholders vote in favor of the adoption of the Merger Agreement, and use reasonable best efforts to cause the ICG Proxy Statement to be cleared by the staff of the SEC and thereafter mailed to ICG stockholders; and | |
| • | as promptly as reasonably practicable following the Appointment Time, take all action necessary in accordance with the DGCL and ICG’s organizational documents to duly call, give notice of, convene and hold a meeting of its stockholders (the “ICG Stockholders Meeting”). |
If the Minimum Condition is satisfied and Merger Sub accepts for
payment Shares tendered pursuant to the Offer, Merger Sub will
have sufficient voting power to adopt the Merger Agreement at a
meeting of the stockholders of ICG without the affirmative vote
of any other ICG stockholder. Under the terms of the Merger
Agreement, Arch has agreed to vote, or cause to be voted, all of
the Shares then owned by it, Merger Sub and any of their
respective subsidiaries, in favor of adoption of the Merger
Agreement.
Certificate of Incorporation, Bylaws, Directors and
Officers. At the Effective Time, the certificate
of incorporation of ICG will be amended and restated so as to
read in the form attached to the Merger Agreement, and as so
amended will be the certificate of incorporation in the
surviving corporation of the Merger until thereafter amended in
accordance with applicable law. The bylaws of Merger Sub, as in
effect immediately prior to the Effective Time will be the
bylaws of the surviving corporation of the Merger until
thereafter amended in accordance with applicable law. From and
after the Effective Time, until successors are duly elected or
appointed and qualified in accordance with applicable law,
(i) the directors of Merger Sub immediately prior to the
Effective Time will be the initial directors of the surviving
corporation in the Merger and (ii) the officers of ICG
immediately prior to the Effective Time will continue as the
officers of the surviving corporation in the Merger.
Representations and Warranties. In the Merger
Agreement, ICG has made customary representations and warranties
to Arch and Merger Sub, including representations relating to
its corporate existence and power, subsidiaries, capitalization,
corporate authorization, board approvals, governmental
authorization, non-contravention, SEC filings and financial
statements, the Sarbanes-Oxley Act of 2002, the absence of
undisclosed material liabilities, the absence of certain
changes, compliance with applicable laws, permits, regulatory
compliance, employee benefit plans and ERISA, taxes,
environmental matters, litigation, real property, intellectual
property, labor matters, information to be included in the ICG
Proxy Statement, the
Schedule 14D-9
and other documents to be filed in connection with the
transactions contemplated by the Merger Agreement, material
contracts, affiliate transactions, insurance, voting
requirements, takeover statutes, brokers’ fees, the opinion
of its financial advisor, unlawful or corrupt payments and the
absence of any additional representations to Arch or Merger Sub.
Arch and Merger Sub have made customary representations and
warranties to ICG with respect to, among other matters, their
corporate existence and power, ownership
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and operations of Merger Sub, corporate authorization,
governmental authorization, non-contravention, information to be
included in the ICG Proxy Statement, the Offer documents and
other documents to be filed in connection with the transactions
contemplated by the Merger Agreement, the financial ability to
complete the transactions contemplated by the Merger Agreement,
the absence of a voting requirement, brokers’ fees,
solvency upon and immediately after consummating the
transactions contemplated by the Merger Agreement, and the
absence of any additional representations to ICG.
Operating Covenants. Pursuant to the Merger
Agreement, from the date of the Merger Agreement until the
earlier of the Effective Time and the termination of the Merger
Agreement, if any, ICG will, and will cause each of its
subsidiaries to (unless otherwise required by applicable law,
consented to in writing by Arch (which consent may not be
unreasonably withheld, delayed or conditioned) or expressly
permitted by the Merger Agreement), conduct its business in all
material respects in the ordinary course consistent with past
practice and in compliance with all applicable laws and, to the
extent consistent therewith, use its reasonable best efforts to
maintain and preserve intact its business organization and
goodwill, keep available the services of its current officers
and other key employees and preserve its relationships with
significant customers, suppliers, distributors and other persons
having business dealings with it, and governmental entities
having regulatory dealings with it, and keep in force the
permits and insurance policies of ICG and its subsidiaries. The
Merger Agreement also contains specific restrictive covenants as
to certain impermissible activities of ICG from the date of the
Merger Agreement until the earlier of the Effective Time and the
termination of the Merger Agreement, if any, which provide that,
subject to certain exceptions as set forth in the Merger
Agreement, ICG and each of its subsidiaries will not, among
other things: (i) declare, set aside or pay any dividends
on or make any other distributions in respect of any of its
capital stock, (ii) issue, sell, pledge, deliver, transfer,
dispose or encumber any shares of capital stock;
(iii) amend ICG’s certificate of incorporation or
bylaws or the similar organizational documents of any
subsidiaries of ICG; (iv) purchase an equity interest in or
a substantial portion of the assets of any other persons if the
aggregate consideration of all such transactions would exceed
$25 million or merge or consolidate with another person;
(v) dispose of rights, properties or assets, other than in
the ordinary course of business; (vi) enter into
commitments for capital expenditures in excess of
$40 million in the aggregate; (vii) incur, redeem,
repurchase, or modify in any material respect the terms of, any
indebtedness; (viii) increase the compensation or benefits
payable to any current or former employee, director or officer;
(ix) change certain accounting practices; (x) make,
change or rescind any express or deemed election with respect to
taxes; (xi) make any settlement payments in excess of
$2 million individually or $5 million in the
aggregate; (xii) make any loans or forgive any material
indebtedness; (xiii) adopt a plan to liquidate or dissolve;
(xiv) materially amend or terminate, or grant material
waivers under, any material contract; (xv) enter into
material interest rate swaps or other hedging arrangements or
(xvi) authorize, commit or agree to do any of the foregoing.
Access to Information. From the date of the
Merger Agreement until the Effective Time or the date, if any,
on which the Merger Agreement is terminated, ICG and its
subsidiaries will, upon reasonable notice and subject to the
terms of the Confidentiality Agreement (as defined below),
provide to Arch and Merger Sub and their respective
Representatives (as defined below) reasonable access during
normal business hours to its properties, books, contracts,
commitments, personnel and records, and other information
concerning its business, properties and personnel as Arch or
Merger Sub may reasonably request. However, ICG and its
subsidiaries will not be required to provide access to or
disclose information where such entity reasonably believes that
such access or disclosure would jeopardize the attorney-client
privilege or contravene any law or agreement to which it is a
party, provided that such entity will use its reasonable
best efforts to obtain any required consents and take such other
action to permit such access or disclosure.
No Solicitation Provisions. Pursuant to the
Merger Agreement, ICG agreed to (i) immediately cease and
cause to be terminated any existing activities, discussions and
negotiations with any person and its Representatives conducted
prior to the date of the Merger Agreement that might be ongoing
with respect to, or that might reasonably be expected to lead
to, any ICG Takeover Proposal (as defined below),
(ii) terminate all physical and electronic dataroom access
previously granted to any such parties and their Representatives
and (iii) request the prompt return or destruction of all
information previously furnished to any such person or its
Representatives. ICG has also agreed that from the date of the
Merger Agreement, neither it nor any of its
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subsidiaries will (and has agreed not to authorize or permit its
directors, officers, employees, consultants, financial advisors,
accountants, legal counsel, investment bankers and other agents,
advisors, financing sources and representatives (collectively,
the “Representatives”) to), directly or
indirectly:
| • | solicit, initiate or knowingly encourage, or knowingly take any action designed to facilitate, any inquires or the making of any proposal that constitutes, or would reasonably be expected to lead to, an ICG Takeover Proposal; | |
| • | enter into any agreement with respect to any ICG Takeover Proposal or any agreement requiring the abandonment, termination or failure to consummate the Merger or any other transaction contemplated by the Merger Agreement; | |
| • | initiate or participate in any discussions or negotiations regarding, or furnish, or disclose to any person any information with respect to, or knowingly take any other action to facilitate the making of any proposal that constitutes, an ICG Takeover Proposal; | |
| • | waive, terminate, modify or fail to enforce any provision of any “standstill” or similar obligation of any person with respect to ICG or any of its subsidiaries; or | |
| • | authorize any of, or commit or agree to do any the foregoing. |
Notwithstanding the foregoing, if prior to the Appointment Time,
in response to an unsolicited bona fide written ICG Takeover
Proposal that the ICG Board determines in good faith, after
consultation with its legal and financial advisors, constitutes
or would reasonably be expected to lead to a Superior Proposal
(as defined below), and which ICG Takeover Proposal was made
after the date of the Merger Agreement and did not otherwise
result from any material breach of the Merger Agreement, ICG
may, if and to the extent that its board of directors determines
in good faith, after consultation with its legal and financial
advisors, that it is required to do so in order to comply with
its fiduciary duties under the DGCL, furnish information with
respect to ICG and its subsidiaries to the person making the ICG
Takeover Proposal and engage in discussions or negotiations with
such person regarding the ICG Takeover Proposal, provided
that such information is furnished pursuant to a
confidentiality agreement that is not less restrictive than the
Confidentiality Agreement, provided, further, that
all information that is furnished to such person must be
provided to Arch at substantially the same time (if such
information has not already been furnished to Arch).
Pursuant to the terms of the Merger Agreement, neither the ICG
Board nor any committee thereof will (i) (a) withdraw or
qualify (or modify in a manner adverse to Arch), or publicly
propose to withdraw or qualify (or modify in a manner adverse to
Arch), the approval, recommendation or declaration of
advisability by such board of directors or any such committee
thereof of the Merger Agreement, the Merger or the other
transactions contemplated by the Merger Agreement,
(b) recommend, adopt or approve, or publicly propose to
recommend, adopt or approve, or fail to reject, any ICG Takeover
Proposal or (c) make any other public statement in
connection with the ICG Stockholders Meeting inconsistent with
the ICG Board Recommendation (any such action, an “ICG
Adverse Recommendation Change”) or (ii) approve or
recommend, or propose to approve or recommend, or allow ICG or
any of its subsidiaries to execute or enter into, any letter of
intent, memorandum of understanding, agreement in principle,
merger agreement acquisition agreement, option agreement, joint
venture agreement, partnership agreement, or other similar
agreement, constituting or related to, or that is intended to or
would reasonably be expected to lead to, any ICG Takeover
Proposal, or requiring ICG to abandon, terminate, delay or fail
to consummate or that would otherwise impede, interfere with or
be inconsistent with, the Merger or any other transaction
contemplated by the Merger Agreement or requiring ICG to fail to
comply with the Merger Agreement (any such agreement, an
“Acquisition Agreement”).
Notwithstanding the foregoing, prior to the Appointment Time, if
the ICG board of directors determines in good faith, after
consultation with outside counsel and a financial advisor of
nationally recognized reputation, that failure to enter into an
Acquisition Agreement could result in a breach of its fiduciary
duties under applicable law, it may (i) terminate the
Merger Agreement and cause ICG to enter into an Acquisition
Agreement with respect to a Superior Proposal or (ii) in
response to an Intervening Event (as defined below) or an ICG
Takeover Proposal that constitutes a Superior Proposal, make an
ICG Adverse Recommendation Change, if (a) ICG provides
notice to Arch advising Arch that the ICG Board intends to take
such action and
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specifying the reasons therefor and including the most recent
version of any related proposed agreement or a summary of the
terms and conditions of the Superior Proposal or a detailed
description of the Intervening Event, (b) for a period of
three business days following Arch’s receipt of such a
notice, ICG negotiates with Arch in good faith to make
adjustments to the Merger Agreement as would allow the ICG Board
to proceed pursuant to the terms of the Merger Agreement and not
make an ICG Adverse Recommendation Change or terminate the
Merger Agreement and (c) at the end of such three business
day period, the ICG Board determines in good faith, after
consultation with outside counsel and a financial advisor of
nationally recognized reputation, that the ICG Takeover Proposal
constitutes a Superior Proposal or determines in good faith,
after consultation with outside counsel, that a failure to make
an ICG Adverse Recommendation Change would constitute a breach
of its fiduciary duties under applicable law. Upon entering into
such Acquisition Agreement in connection with a Superior
Proposal, ICG may be required to pay Arch the Termination Fee
(as defined below).
ICG must promptly (and in any event within twenty-four hours of
receipt) advise Arch and Merger Sub orally and in writing of the
receipt, directly or indirectly, of any inquiries, requests,
discussions, negotiations or proposals relating to an ICG
Takeover Proposal, or any request for nonpublic information
relating to ICG or any of its subsidiaries from a person that
informs ICG that it plans to make an ICG Takeover Proposal. Such
notice must include the material terms and conditions thereof
and will include a copy of any written inquiry, request or
proposal and copies of any information provided to or by any
third party relating thereto. ICG is also required to keep Arch
apprised on a current status and details or any such request,
ICG Takeover Proposal or inquiry.
“ICG Takeover Proposal” means any inquiry,
proposal or offer from any person relating to any
(i) direct or indirect acquisition or purchase of a
business that constitutes 25% or more of the net revenues, net
income or the assets of ICG and its subsidiaries, taken as a
whole, (ii) direct or indirect acquisition or purchase of
25% or more of any class of equity securities of ICG or any of
its Subsidiaries, (iii) any tender offer or exchange offer
that if consummated would result in any person beneficially
owning 25% or more of any class of equity securities of the ICG
or any of its subsidiaries or (iv) any merger,
consolidation, business combination, asset purchase,
recapitalization or similar transaction involving ICG or any of
its subsidiaries, other than the transactions contemplated by
the Merger Agreement.
“Intervening Event” means a material event or
circumstance that was not known to the ICG Board on the date of
the Merger Agreement, which event or circumstance, or any
material consequences thereof, becomes known to the ICG Board
prior to the Appointment Time; provided, however, that in
no event shall the receipt, existence or terms of an ICG
Takeover Proposal or any matter relating thereto, constitute an
Intervening Event.
“Superior Proposal” means a bona fide written
proposal from any person or group to acquire, directly or
indirectly, including pursuant to a tender offer, exchange
offer, merger, consolidation, business combination,
recapitalization, liquidation, dissolution or similar
transaction, for consideration consisting of cash
and/or
securities, a majority of the combined voting power of ICG then
outstanding or a majority of the assets of ICG that the ICG
Board determines in its good faith judgment after consulting
with its legal and financial advisors would be more favorable
from a financial point of view to the stockholders of ICG than
the transactions contemplated by the Merger Agreement (including
any changes proposed by Arch to the terms of the Merger
Agreement) and is reasonably likely to receive all required
governmental approvals on a timely basis and is otherwise
reasonably capable of being consummated on the terms proposed.
Offer Documents. Subject to the terms and
conditions provided in the Merger Agreement, each of Arch,
Merger Sub and ICG has agreed to promptly correct or supplement
any information provided by it for inclusion in the
Schedule TO and the other Offer documents or the
Schedule 14D-9
if such information has become false or misleading in any
material respect or as otherwise required by applicable law.
Arch and Merger Sub also agreed with respect to the
Schedule TO and the Offer documents, and ICG also agreed
with respect to the
Schedule 14D-9,
to take all steps necessary to cause the Schedule TO and
the other Offer documents, or the
Schedule 14D-9,
as applicable, as so corrected, to be filed with the SEC and
disseminated to the ICG stockholders, in each case to the extent
required by the Exchange Act. Arch and Merger Sub, on
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the one hand, and ICG, on the other hand, agreed to give the
other and its counsel reasonable opportunity to review the
Schedule TO and the other Offer documents, or the
Schedule 14D-9,
as applicable, before such documents are filed with the SEC, and
to give due consideration to all the reasonable additions,
deletions or changes suggested thereto by the other and its
counsel. In addition, Arch and Merger Sub, on the one hand, and
ICG, on the other hand, agreed to promptly provide the other and
its counsel with copies of any written comments, and to inform
the other of any oral comments, that it may receive from time to
time from the SEC or its staff, and to give the other and its
counsel a reasonable opportunity to participate in the response
to those comments.
Reasonable Best Efforts, Cooperation. ICG,
Arch and Merger Sub have agreed in the Merger Agreement to use
reasonable best efforts to take, or cause to be taken, all
actions, and do, or cause to be done, and assist and cooperate
with the other parties in doing, all things necessary, proper or
advisable to consummate and make effective, as promptly as
reasonably practicable, the transactions contemplated by the
Merger Agreement and to obtain satisfaction or waiver of the
conditions to the Offer and conditions precedent to the Merger,
including: (i) the obtaining of all necessary actions or
nonactions, waivers, consents and approvals from governmental
entities and the making of all necessary registrations and
filings and taking of all steps as may be necessary to obtain an
approval or waiver from or to avoid an action or proceeding by
any governmental entity, (ii) the obtaining of all
necessary consents, approvals and waivers from third parties and
(iii) the execution and delivery of any additional
instruments necessary to consummate the transactions
contemplated by the Merger Agreement. Pursuant to the Merger
Agreement “reasonable best efforts” includes requiring
the parties (i) to sell, hold separate or otherwise dispose
of, or conduct the businesses of ICG, Arch or any of their
respective affiliates in a manner which would resolve such
objections or suits or (ii) agree to do or permit the doing
of the same; provided, however, that no party shall be
required to take any such action that is not conditioned upon
the consummation of the Merger or that would, individually or in
the aggregate, reasonably be expected to result in a Material
Adverse Effect (as defined below) with respect to ICG or Arch.
Both ICG and Arch have agreed to make an appropriate filing
under the HSR Act with respect to the transactions contemplated
by the Merger Agreement as promptly as reasonably practicable
and to take all other actions necessary to cause the expiration
or termination of the applicable waiting periods under the HSR
Act as soon as practicable.
In connection with the foregoing, each of ICG and Arch have
agreed to use reasonable best efforts to (i) cooperate in
all respects with each other in connection with any filing or
submission and in connection with any investigation or other
inquiry, including any proceeding initiated by a private party,
(ii) keep the other party informed in all material respects
of any material communication received by such party from, or
given by such party to, the Federal Trade Commission (the
“FTC”), the Antitrust Division of the
Department of Justice (the “Antitrust
Division”) or any other governmental entity and of any
material communication received or given in connection with any
proceeding by a private party, in each case regarding the
transactions contemplated by the Merger Agreement and
(iii) permit the other party to review any material
communication given by it to, and consult with each other in
advance of any meeting or conference with, any such governmental
entity or in connection with any proceeding by a private party,
subject to the provisions of the Confidentiality Agreement and
the preservation of each party’s attorney-client,
work-product or other privilege, and the protection of any
competitively sensitive information.
Indemnification and Insurance. Arch and the
surviving corporation in the Merger have agreed that all rights
to indemnification including advancements and reimbursements of
expenses and exculpation from liability relating to, resulting
from or arising out of (i) acts or omissions occurring at
or prior to the Appointment Time and (ii) Claims (as
defined below) existing as of the date of the execution of the
Merger Agreement in favor of current or former directors,
officers, employees, agents or fiduciaries with respect to any
employee benefit plan of ICG and its subsidiaries (collectively,
the “Indemnified Parties”) as provided in their
respective organizational documents or in indemnification or
other agreements containing indemnification agreements in effect
as of the date of the Merger Agreement, will be assumed by the
surviving corporation in the Merger as of the Effective Time and
will continue in full force and effect with any further action.
These instruments containing these rights to indemnification may
not be amended or otherwise modified in any manner that would
adversely affect any indemnification right thereunder of any
Indemnified Party. Arch and
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the surviving corporation in the Merger have agreed to indemnify
to the fullest extent permitted by law and hold harmless, any
Indemnified Party against any losses, claims, damages,
liabilities, judgments, amounts paid in settlements, penalties
and any amount owing or paid in connection with any threatened
or actual claim, action, suit proceeding, investigation,
judgment or settlement (a “Claim”), arising out
of or pertaining to (i) the fact that such Indemnified
Party was a director, officer, employee or agent of ICG or any
of its subsidiaries or any of their respective predecessors, a
fiduciary with respect to any employee benefit plan maintained
by any of the foregoing or (ii) the Merger Agreement or any
transactions contemplated thereby. In addition, the surviving
corporation in the Merger assumes all liability for losses,
claims, damages, liabilities or expenses arising under certain
existing litigation of ICG.
For six years following the Effective Time, the surviving
corporation in the Merger will maintain in effect policies of
directors’ and officers’ liability insurance covering
acts or omissions prior to the Effective Time with respect to
the Indemnified Parties providing coverage on terms and in
amounts no less favorable than those of the ICG’s current
coverage; provided that (i) neither Arch nor the
surviving corporation will be obligated to make aggregate annual
premium payments for such insurance to the extent such premiums
exceed 350% of the aggregate annual premiums paid by ICG for
such insurance, (ii) if the annual premiums of such
insurance coverage exceed such amount, Arch will maintain the
most advantageous policies of directors’ and officers’
insurance obtainable for an aggregate annual premium not to
exceed such 350% amount and (iii) at Arch’s option in
lieu of the foregoing, the surviving corporation may obtain a
directors’ and officers’ liability insurance
“tail” insurance program for a period of six years
after the Effective Time that provides similar coverage in all
material respects to the coverage described above.
Public Announcements. Under the Merger
Agreement, Arch and ICG have agreed to consult with each other
before holding any press conferences, analyst calls or other
public meetings or discussions and before publishing any press
releases or other public announcements related to the
transactions contemplated by the Merger Agreement, other than
certain employee communications. The parties have agreed to
provide each other the opportunity to review and comment upon
any press release, public announcement or statement related the
transactions contemplated by the Merger Agreement and to refrain
from issuing any such press release or other public statement
prior to such consultation, except as may be required by law,
court process or the obligations of a national securities
exchange.
Transaction Litigation. Under the Merger
Agreement, ICG, Arch and Merger Sub have agreed to cooperate and
consult with one another, to the fullest extent possible, in
connection with any stockholder litigation against any of them
or their respective directors or officers with respect to the
transactions contemplated by the Merger Agreement. ICG has
agreed to allow Arch to participate in the defense or settlement
of any such litigation and to not compromise or settle any
litigation commenced against it relating to the Merger Agreement
or the transactions contemplated thereby without Arch’s
prior written consent (which is not be unreasonably withheld,
delayed or conditioned).
Section 16 Matters. Arch and ICG will
take all steps reasonably necessary to cause the transactions
contemplated by the Merger Agreement and any other dispositions
of equity securities of ICG in connection with the Merger
Agreement by each individual who is a director or officer of ICG
to be exempt under
Rule 16b-3
promulgated under the Exchange Act.
Employee
Matters.
ICG Employees. Until December 31, 2011,
Arch has agreed to, or to cause the surviving corporation in the
Merger to, provide, compensation and benefits to employees and
former employees of ICG and its subsidiaries (the “ICG
Employees”) that are no less favorable, in the
aggregate, than the compensation and benefits provided to such
ICG Employees immediately prior to the Effective Time. For the
period beginning on January 1, 2012 through June 30,
2013, Arch will, or will cause the surviving corporation in the
Merger to, provide compensation and benefits to the ICG
Employees that are substantially similar in the aggregate to the
compensation and benefits provided to similarly situated
employees of Arch as of January 1, 2012. None of the
foregoing shall prevent Arch or the surviving corporation in the
Merger from terminating any ICG
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Employee, subject to compliance with the terms of any applicable
severance arrangement applicable to such ICG Employee.
Benefit Plans. Arch has agreed that it will,
and will cause the surviving corporation in the Merger to, honor
in accordance with their terms each material bonus, pension,
profit sharing, deferred compensation, incentive compensation,
equity ownership, stock purchase, stock option, equity-based
compensation, retirement, vacation, employment, disability,
death benefit, flexible spending account, hospitalization,
medical, life insurance, welfare, change of control, retention,
severance or other employee benefit plan, policy, program,
agreement, arrangement or understanding, whether or not subject
to the Employee Retirement Income Security Act of 1974, as
amended, in each case sponsored or maintained by ICG or any of
its subsidiaries or to which ICG or any of its subsidiaries
contributes or is obligated to contribute for the benefit of any
ICG Employee, and with respect to which ICG or any of its
subsidiaries has any liability, in each case other than a
multiemployer plan (collectively, the “ICG Benefit
Plans”), including any rights or benefits arising as a
result of the transactions contemplated by the Merger Agreement.
However, in respect of those ICG Benefit Plans that provide
post-retirement medical benefits to ICG Employees at an ICG
location prior to the closing date of the Merger (each a
“Retiree Medical Plan”), Arch may, or may cause
the surviving corporation in the Merger to, provide such
coverage under either the ICG Benefit Plan or a program
maintained by Arch for similarly situated employees.
Credit for Service. Arch has agreed that it
will and will cause its affiliates to, provide credit for each
ICG Employee’s length of service with ICG (as well as
service with any predecessor employer of ICG or any of its
affiliates, to the extent such service is recognized by ICG or
such of its affiliates) for all purposes (including eligibility,
vesting and benefit level, but not for purposes of any benefit
accrual under any cash balance or defined benefit plan) under
each plan, program, policy or arrangement of Arch and its
affiliates to the same extent that such services was recognized
under a similar plan, program, policy or arrangement of ICG or
any of its affiliates, except where such recognition would
result in duplication of benefits or would be deemed to allow
any ICG Employee to participate in a Retiree Medical Plan of
Arch or the surviving corporation in the Merger that ceased to
allow new participants on a date prior to the closing date of
the Merger.
Welfare Plans. To the extent permitted by
applicable law, Arch has agreed that it will cause each of its
and its affiliates’ benefit plans in which any ICG Employee
participates that is a health and welfare plan to:
(i) waive all limitations as to preexisting conditions,
exclusions and service conditions (other than any Retiree
Medical Plans) with respect to coverage and participation
requirements applicable to ICG Employees (other than those that
were in effect prior to the closing date of the Merger under the
corresponding ICG Benefit Plan), (ii) honor any payments,
charges and expenses of such ICG Employees that were applied to
the applicable deductible and
out-of-pocket
maximums under the corresponding ICG Benefit Plan during the
calendar year in which the Effective Time occurs and
(iii) with respect to any medical plan (other than any
Retiree Medical Plan), waive any waiting period limitation or
evidence of insurability requirement that would otherwise be
applicable to the extent such ICG Employee had satisfied any
similar limitation under the corresponding ICG Benefit Plan or
to extent that such pre-existing condition limitations,
exclusions, actively-at-work requirements and waiting periods
would not have been satisfied or waived under the comparable ICG
Benefit Plan immediately prior to the Effective Time.
Annual Bonus Program. Under the Merger
Agreement, Arch has agreed that within fifteen calendar days
following the closing date of the Merger, it will, or will cause
the surviving corporation in the Merger to, make a payment to
each participant in ICG’s 2011 annual bonus program in
amount equal to the greater of (i) the actual amount due to
such employee under the terms of the such annual bonus program
based on performance through the closing date of the Merger,
assuming (a) full achievement of all individual performance
goals, (b) full payment in respect of the discretionary
component of such bonus, (c) without regard to any negative
discretion under ICG’s 2011 annual bonus program to adjust
the bonus amount and (d) without regard to any changes
relating to, or arising from, the transactions contemplated by
the Merger Agreement and (ii) the participant’s target
bonus amount under ICG’s 2011 annual bonus program. Such
payment amount shall be prorated based on the number of days
between January 1, 2011 and the closing date of the Merger.
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Financing. Under the Merger Agreement, Arch
has agreed to use, and to cause its affiliates to use,
reasonable best efforts to take all actions and to do all things
necessary, proper and advisable to maintain the Financing
Commitment (as defined in the Merger Agreement) and to arrange
the Financing (as defined in the Merger Agreement) on the terms
and conditions described in the Financing Commitment. Arch has
agreed not to reduce the amount of Financing to below the amount
required to consummate the transactions contemplated by the
Merger Agreement. Arch has also agreed to notify ICG within
twenty-four hours in the event that any portion of the Financing
becomes unavailable or if Arch becomes aware that any portion of
the Financing will be unavailable. In such event, Arch will use
its reasonable best efforts to obtain, as promptly as
practicable, any such unavailable portion of the Financing from
alternative sources on terms that would enable it to consummate
the transactions contemplated by the Merger Agreement. Arch
agreed to refrain, and to cause its affiliates to refrain, from
taking any action that would reasonably be expected to result in
a failure of any of the conditions contained in the Financing
Commitment or in any definitive agreement related to the
Financing.
Under the Merger Agreement, ICG has agreed to use its
commercially reasonable efforts to cause its Representatives and
the Representatives of its subsidiaries to provide reasonable
cooperation in connection with the Financing as requested by
Arch, including by providing certain financial information and
assisting in the preparation of certain documents and materials
in connection with the Financing. In addition, Arch has agreed
to use its reasonable best efforts to cause the Marketing Period
(as defined in the Merger Agreement), the completion of which is
a condition to the Offer (see Section 15 —
“Conditions to the Offer”), to commence as promptly as
practicable following the date of the Merger Agreement.
Under the Merger Agreement, Arch and Merger Sub have
acknowledged and agreed that neither the obtaining of the
Financing, nor the completion of any issuance of securities
contemplated by the Financing, is a condition to the Closing,
and reaffirm their obligations to consummate the transactions
contemplated by the Merger Agreement, irrespective and
independently of the availability of the Financing.
Debt Tender Offer. Pursuant to the terms of
the Merger Agreement, ICG has agreed to, and to cause its
subsidiaries to, use their respective commercially reasonable
efforts to commence, promptly after a written request by Arch to
do so, tender offers and relates consent solicitations with
respect to all of the $200 million aggregate principal
amount of its 9.125% Senior Secured Second Priority Notes due
2018 (the “2018 Notes”) on terms and conditions
specified by Arch (the “Debt Offers”). The
closing of the Debt Offers shall be conditioned on the
completion of the Merger and shall be consummated in compliance
with applicable securities laws. ICG agrees to provide
cooperation with respect to the Debt Offers, including
preparation of all necessary documentation. If requested in
writing by Arch and as permissible under the applicable
indentures, ICG will optionally redeem or satisfy, discharge and
defease the 2018 Notes, provided that such actions shall
not be required unless they can be conditioned upon the
occurrence of the Appointment Time.
Arch has acknowledged and agreed in the Merger Agreement that
neither the pendency nor the consummation of any Debt Offer or
the redemption, satisfaction, discharge or defeasance with
respect to the 2018 Notes is a condition to Arch’s
obligations to consummate the Merger or the other transactions
contemplated by the Merger Agreement.
Takeover Statute. The Merger Agreement
provides that, if any state anti-takeover law or regulation
becomes applicable to the Merger Agreement or any transaction
contemplated thereby, then the ICG Board shall use its
reasonable best efforts to render such statute or regulation (or
the relevant provisions thereof) inapplicable so that the
transactions contemplated by the Merger Agreement may be
consummated as promptly as practicable on the terms contemplated
thereby.
Conditions to the Offer. See
Section 15 — “Conditions to the Offer.”
Conditions to the Merger. The obligations of
each party to consummate the Merger are subject to the
satisfaction of the following conditions (any of which may be
waived in whole or in part by Arch, Merger Sub and ICG, as the
case may be, to the extent permitted by applicable law):
(i) to the extent required by the DGCL, the Merger
Agreement must have been adopted by the vote of the holders of
outstanding shares of ICG common stock, voting together as a
single class, representing at least a majority of all votes
entitled to be cast thereupon by holders of the outstanding ICG
common stock; (ii) no judgment, order, decree or law
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entered, enacted, promulgated, enforced or issued by any court
of other governmental entity of competent jurisdiction or other
legal restraint or prohibition shall be in effect that prohibits
the consummation of the Merger; and (iii) Merger Sub must
have accepted for payment all Shares validly tendered and not
withdrawn pursuant to the Offer (including pursuant to any
“subsequent offering period” provided by Merger Sub
pursuant to the Merger Agreement).
Termination. The Merger Agreement may be
terminated as follows: (i) by mutual written consent of
both Arch and ICG at any time prior to the Effective Time;
(ii) by either Arch or ICG if the Appointment Time has not
occurred on or before the Outside Date; provided that the
right to terminate pursuant to this clause (ii) will not be
available to any party whose breach of any provision of the
Merger Agreement principally causes the failure of the Offer to
be consummated by such time, provided, further that if
the HSR Condition has not been fulfilled by the Outside Date,
the Outside Date will be automatically extended to
November 2, 2011; (iii) by either Arch or ICG if any
governmental entity of competent jurisdiction shall have issued
a final, non-appealable order permanently enjoining or otherwise
prohibiting the consummation of the transactions contemplated by
the Merger Agreement, except that no party may seek to terminate
the Merger Agreement pursuant to this clause (iii) if such
party’s breach of its obligations principally contributed
to the occurrence of such order; (iv) by either Arch or ICG
if (a) at any then-scheduled expiration of the Offer,
(b) each condition to the Offer (other than the Minimum
Condition) has been satisfied or waived, (c) the Minimum
Condition shall not have been satisfied and (d) no further
extensions or re-extensions of the Offer are permitted or
required under the terms of the Merger Agreement; (v) by
Arch if, prior to the Appointment Time, ICG has breached or
failed to perform any of its covenants or other agreements
contained in the Merger Agreement or there exists a breach of
any representation or warranty of ICG made pursuant to the
Merger Agreement, such that any of the conditions to the Offer
would not be satisfied, which breach is not cured or satisfied
within 30 days of written notice thereof or is not capable
of being cured by the Outside Date; (vi) by Arch if
(a) the ICG Board has made an ICG Adverse Recommendation
Change, (b) ICG has breached the provisions described above
under “— No Solicitation”, (c) ICG or
the ICG Board approves or recommends to enter into an
Acquisition Agreement with respect to any ICG Takeover Proposal,
(d) any tender offer or exchange offer is commenced by any
third party with respect to the outstanding ICG common stock
prior to the Appointment Time and the ICG Board has not
recommended that the stockholders reject such offer within ten
business days of the commencement of such offer, unless it has
released a press release that expressly reaffirms the ICG Board
Recommendation within such ten business day period, or
(e) ICG or ICG Board publicly proposes or announces its
intention to do any of the foregoing; (vii) by Arch, if
prior to the Appointment Time, a Material Adverse Effect on ICG
has occurred or exists, which is incapable of being cured by the
Outside Date; (viii) by ICG if, prior to the Appointment
Time, Arch or Merger Sub has breached or failed to perform any
of their covenants or other agreements contained in the Merger
Agreement or there exists a breach of any representation or
warranty of Arch or Merger Sub made pursuant to the Merger
Agreement, that would reasonably be expected to prevent, or
materially impair, the ability of either Arch or Merger Sub to
consummate the transactions contemplated by the Merger
Agreement, which breach is not cured or satisfied within
30 days of written notice thereof or is not capable of
being cured by the Outside Date; or (ix) by ICG if, prior
to the Appointment Time, it has received a Superior Proposal and
the ICG Board has determined in good faith (after consulting
with its outside legal counsel and financial advisors) that the
failure to accept such Superior Proposal is reasonably likely to
be inconsistent with the fiduciary duties of the members of the
ICG Board under applicable law, after complying in all material
respects with the provisions described above under
“— No Solicitation.”
“Material Adverse Effect” with respect to ICG
means any changes, effects, events, circumstances, states of
facts, occurrences or developments that, individually or taken
together, materially adversely affect the business, assets,
properties, liabilities, financial condition or results of
operations of the ICG and its subsidiaries, taken as a whole,
excluding any change, effect, event, circumstance, state of
facts, occurrence or development to the extent that it results
from or arises in connection with (i) changes or conditions
generally affecting the coal industry, (ii) general
economic or regulatory, legislative or political conditions or
securities, credit, financial or other capital markets
conditions (including prevailing interest rates, access to
capital and commodity prices), in each case in the United States
or any foreign jurisdiction, (iii) any failure, in and of
itself, by such party to meet any internal or published
projections, forecasts, estimates or predictions in respect
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of revenues, earnings or other financial or operating metrics
for any period (it being understood that the facts or
occurrences giving rise to or contributing to such failure may
be deemed to constitute, or be taken into account in determining
whether there has been or will be, a Material Adverse Effect or
Material Adverse Effect on ICG), (iv) the execution and
delivery of the Merger Agreement or the public announcement or
pendency of the Offer and the Merger (provided,
however, that the exceptions in this clause
(iv) shall not apply to that portion of any representation
or warranty contained in the Merger Agreement to the extent that
the purpose of such portion of such representation or warranty
is to address the consequences resulting from the execution and
delivery of the Merger Agreement, the public announcement or
pendency of the Offer and the Merger or the performance of
obligations or satisfaction of conditions under the Merger
Agreement), (v) any change, in and of itself, in the market
price or trading volume of such party’s securities (it
being understood that the facts or occurrences giving rise to or
contributing to such change may be deemed to constitute, or be
taken into account in determining whether there has been or will
be, a Material Adverse Effect or Material Adverse Effect on
ICG), (vi) any change in applicable law, regulation or GAAP
(as defined in the Merger Agreement) (or authoritative
interpretation thereof), (vii) geopolitical conditions, the
outbreak of a pandemic or other widespread health crisis, the
outbreak or escalation of hostilities, any acts of war, sabotage
or terrorism, or any escalation or worsening of any such acts of
war, sabotage or terrorism threatened or underway as of the date
of the Merger Agreement, (viii) any hurricane, tornado,
flood, earthquake, volcano eruption or natural disaster, or
(ix) relating to the outcome of any litigation or other
proceeding described in the ICG Disclosure Letter or the ICG SEC
Documents (each as defined in the Merger Agreement) to the
extent the outcome of such litigation or proceeding can
reasonably be expected based on the factual description of such
litigation or other proceeding in the ICG Disclosure Letter or
the ICG SEC Documents (but excluding any forward-looking
disclosures set forth in any risk factor section, any
disclosures in any section relating to forward looking
statements and any other similar disclosures included therein to
the extent that they are predictive or forward-looking in
nature), except, in the case of clauses (i), (ii), (vi),
(vii) and (viii), only to the extent such changes, effects,
events, circumstances, states of facts, occurrences or
developments affect ICG and its subsidiaries, taken as a whole,
to a disproportionate degree relative to other competitors in
the coal industry.
“Material Adverse Effect” with respect to Arch
means any changes, effects, events, circumstances, states of
facts, occurrences or developments that, individually or in the
aggregate, would reasonably be expected to prevent, or
materially impair, the ability of either Arch or Merger Sub to
consummate the Offer, the Merger and the other transactions
contemplated by the Merger Agreement.
Fees and Expenses. All fees and expenses
incurred in connection with the Merger Agreement and the
transactions contemplated by the Merger Agreement will be paid
by the party incurring such expenses, except that Arch and ICG
will each bear and pay one-half of the costs and expenses
incurred in connection with the filing, printing and mailing of
the Schedule TO and the other Offer documents and the
Schedule 14D-9.
Termination Fee. ICG shall pay Arch a
non-refundable termination fee equal to $115 million,
payable by wire transfer: (i) if the Merger Agreement is
terminated pursuant to (vi) of the section entitled
“— Termination” above, which fee shall be
paid no later than two business days after the date of such
termination; (ii) if the Merger Agreement is terminated
pursuant to clause (ix) of the section entitled
“— Termination” above, which fee shall be
paid contemporaneously with the termination of the Merger
Agreement; or (iii) if the Merger Agreement is terminated
pursuant to clause (ii), clause (iv) or clause (v) of
the section entitled “— Termination” above,
and (a) prior to such termination, an ICG Takeover Proposal
has been made known to ICG or been made directly to the
stockholders of ICG generally or any person has publicly
announced an intention (whether or not conditional) to make an
ICG Takeover Proposal, and (b) (1) within 12 months of
such termination ICG or any of its subsidiaries enters into a
definitive agreement with respect to any ICG Takeover Proposal,
(2) any ICG Takeover Proposal is consummated or
(3) the ICG Board recommends an ICG Takeover Proposal.
Amendment. The Merger Agreement may be amended
or waived by written agreement of ICG, Arch and Merger Sub;
provided that after the receipt of the affirmative vote
of the holders of at least a majority of the outstanding Shares
to adopt the Merger Agreement (if required under Delaware law),
if any amendment or
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waiver requires further approval of the ICG stockholders, the
effectiveness of the amendment or waiver will also require the
approval of the ICG stockholders.
Extension; Waiver. At any time prior to the
Effective Time, any party to the Merger Agreement may
(i) extend the time for the performance of any of the
obligations or other acts of the other party, (ii) waive
any inaccuracies in the representations and warranties made to
such party or parties contained in the Merger Agreement or in
any document delivered pursuant thereto or (iii) subject to
the proviso in the section entitled
“— Amendment” above, waive compliance with
any of the agreements or conditions for the benefit of such
party or parties contained in the Merger Agreement. Any such
agreement to extend or waive must be set forth in an instrument
in writing signed on behalf of such party. The failure of any
party to the Merger Agreement to assert any of its rights under
the Merger Agreement will not constitute a waiver of such rights.
Other
Agreements
Tender and Voting Agreements. In order to
induce Arch and Merger Sub to enter into the Merger Agreement,
(i) certain affiliates of WL Ross & Co. LLC who
collectively own approximately 6% of the outstanding stock of
ICG have entered into a tender and voting agreement with Arch
and Merger Sub and (ii) certain affiliates of Fairfax
Financial Holdings Limited who collectively own approximately
11% of the outstanding stock of ICG have also entered into a
tender and voting agreement with Arch and Merger Sub, pursuant
to which these stockholders have agreed to, among other things,
tender their Shares of ICG’s common stock into the Offer
and vote their Shares of ICG’s common stock in favor of
adopting the Merger Agreement, if applicable. The stockholders
party to the tender and voting agreements have agreed to comply
with certain restrictions on the disposition of such Shares,
subject to the terms and conditions contained therein. Pursuant
to their terms, the tender and voting agreements will terminate
upon the earlier of (i) notice of the termination of the
Merger Agreement, (ii) a change in recommendation by the
ICG Board, (iii) the termination or expiration of the
Offer, without any Shares being accepted for payment and
(iv) the consummation of the Merger.
The foregoing description of the tender and voting agreements
does not purport to be complete and is qualified in its entirety
by reference to the tender and voting greements, copies of which
have been included as exhibits to the Schedule TO, which
you may examine and copy as set forth in
Section 8 — “Certain Information Concerning
ICG” above.
Confidentiality Agreement. Arch and ICG
entered into a non-disclosure agreement dated as of
February 25, 2011, as supplemented by a letter agreement
between Arch and ICG dated as of March 15, 2011 (the
“Confidentiality Agreement”), which governs the
disclosure of any confidential information concerning the other
party to other persons. As a condition to being furnished
confidential information of the other party, in the
Confidentiality Agreement, each of Arch and ICG agreed, among
other things, to keep such confidential information confidential
and to use it only for specified purposes. The foregoing
description does not purport to be complete and is qualified in
its entirety by reference to the Confidentiality Agreement, a
copy of which has been included as an exhibit to the
Schedule TO.
As discussed in Section 13 — “The
Transaction Documents — The Merger
Agreement — Operating Covenants,” pursuant to the
Merger Agreement, from the date of the Merger Agreement until
the earlier of the Effective Time and the termination of the
Merger Agreement, ICG has agreed not to (i) split, combine
or reclassify any shares of its capital stock,
(ii) declare, set aside or pay any dividends on, make any
other distributions in respect of, any of its capital stock,
(iii) subject to certain exceptions, purchase, redeem or
otherwise acquire any shares of its capital stock or any other
securities thereof or any rights, warrants or options to acquire
such shares or other securities or (iv) subject to certain
exceptions, issue, sell, pledge, deliver, transfer, dispose or
encumber any shares of its capital stock, any other voting
securities or any securities convertible into or exercisable
for, or any rights, warrants or options to acquire, any such
shares, voting securities or convertible securities.
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Notwithstanding any other provision of the Offer, Merger Sub is
not required to accept for payment or, subject to any applicable
rules and regulations of the SEC, including
Rule 14e-1(c)
under the Exchange Act (relating to Merger Sub’s obligation
to pay for or return tendered Shares promptly after termination
or expiration of the Offer), required to pay for any tendered
Shares if at any then-scheduled expiration of the Offer:
(i) the Minimum Condition is not satisfied;
(ii) the HSR Condition is not satisfied;
(iii) any judgment, order, decree or law shall have been
entered, enacted, promulgated, enforced or issued by any court
or other governmental entity of competent jurisdiction or other
legal restraint or prohibition shall be in effect enjoining or
otherwise preventing the making of the Offer, the acceptance for
payment of any Shares by Arch, Merger Sub or any other affiliate
of Arch, the consummation of the
Top-Up
Option, the consummation of the Merger, Arch or Merger
Sub’s full rights of ownership and voting of the Shares or
Arch or Merger Sub’s ownership or operation of ICG, other
than the application of the applicable waiting periods under the
HSR Act;
(iv) any of the representations and warranties of ICG
contained in (a) Section 3.1 (Organization, Standing
and Corporate Power), Section 3.4 (Authority;
Noncontravention), Section 3.19 (Voting Requirement),
Section 3.20 (State Takeover Statutes) or Section 3.22
(Brokers) of the Merger Agreement was not (as of the date of the
Merger Agreement), or is not (as of such then-scheduled
expiration of the Offer as though made at such time), true and
correct in all material respects (except to the extent such
representations and warranties relate to an earlier date, in
which case such representations and warranties relate to such
earlier date), (b) Section 3.3 (Capital Structure) of
the Merger Agreement was not (as of the date of the Merger
Agreement), or is not (as of such then-scheduled expiration of
the Offer as though made at such time), true and correct in all
but de minimis respects (except to the extent such
representations and warranties relate to an earlier date, in
which case such representations and warranties relate to such
earlier date) or (c) the first sentence of Section 3.6
(Absence of Certain Changes) of the Merger Agreement was not (as
of the date of the Merger Agreement), or is not (as of such
then-scheduled expiration of the Offer as though made at such
time), true and correct in all respects (except to the extent
such representations and warranties relate to an earlier date,
in which case such representations and warranties relate to such
earlier date);
(v) any of the representations and warranties contained in
Article III of the Merger Agreement (excluding those listed
above) was not (as of the date of the Merger Agreement), or is
not (as of such then-scheduled expiration of the Offer as though
made at such time), true and correct in all respects (except to
the extent such representations and warranties relate to an
earlier date, in which case such representations and warranties
relate to such earlier date), except where the failure of such
representations and warranties to be so true and correct would
not reasonably be expected to result, individually or in the
aggregate, in a Material Adverse Effect (as defined in the
Merger Agreement) on ICG;
(vi) ICG shall not have performed in all material respects
all of its obligations required to be performed by it under the
Merger Agreement at or prior to the then-scheduled expiration of
the Offer;
(vii) since the date of the Merger Agreement, there shall
have occurred any change, effect, event, circumstance, state of
facts, occurrence or development that, individually or taken
together, has had or would reasonably be expected to result in a
Material Adverse Effect on ICG;
(viii) ICG shall have failed to deliver to Arch a
certificate dated the Offer Closing Date signed on its behalf by
its Chief Financial Officer or Chief Executive Officer to the
effect that none of the conditions set forth in clauses (iv),
(v) ,(vi) and (vii) above shall have occurred and be
continuing as of the expiration of the Offer;
(ix) the Merger Agreement shall have been terminated in
accordance with its terms; or
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(x) if the Marketing Period (as defined in the Merger
Agreement) has not ended at the time of the satisfaction or
waiver of the conditions set forth above (other than those
conditions that by their terms are to be satisfied at the
closing of the Offer).
The foregoing conditions are for the benefit of Arch and Merger
Sub and may be asserted by Arch or Merger Sub regardless of the
circumstances giving rise to any such conditions and may be
waived by Arch or Merger Sub (other than the Minimum Condition
with respect to which such waiver will only be effective with
the written agreement of ICG) in whole or in part at any time
and from time to time in its reasonable discretion, in each
case, subject to the terms of the Merger Agreement and
applicable law. The failure by Arch or Merger Sub at any time to
exercise any of the foregoing rights shall not be deemed a
waiver of any such right and each such right shall be deemed an
ongoing right which may be asserted at any time and from time to
time.
General. Based on Arch and Merger Sub’s
examination of publicly available information filed by ICG with
the SEC and other publicly available information concerning ICG,
we are not aware of any governmental license or regulatory
permit that appears to be material to ICG’s business that
might be adversely affected by Merger Sub’s acquisition of
Shares pursuant to the Offer or, except as set forth below, of
any approval or other action by any government or governmental
administrative or regulatory authority or agency, domestic or
foreign, that would be required for our acquisition or ownership
of Shares pursuant to the Offer. Should any such approval or
other action be required or desirable, we currently contemplate
that such approval or other action will be sought. Except as
described under — “Antitrust Compliance,”
there is no current intent to delay the purchase of Shares
tendered pursuant to the Offer pending the outcome of any such
matter. We are unable to predict whether we will determine that
we are required 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
(with or without substantial conditions) or that if such
approvals were not obtained or such other actions were not taken
adverse consequences might not result to ICG’s business or
certain parts of ICG’s business might not have to be
disposed of, any of which could cause us to elect to terminate
the Offer without the purchase of Shares thereunder. Our
obligation under the Offer to accept for payment and pay for
Shares is subject to the conditions set forth in
Section 15 — “Conditions to the Offer.”
Shareholder Litigation. On May 9 and
May 11, 2011, two putative class action lawsuits were filed
in the Court of Chancery of the State of Delaware purportedly on
behalf of a class of shareholders of ICG, respectively docketed
as Kirby v. International Coal Group, Inc., et al.,
Case No. 6464 and Kramer v. Wilbur L.
Ross, Jr., et al., Case No. 6470 (collectively,
the “Delaware Actions”). Each of the complaints
names as defendants ICG, members of the ICG Board, Arch, and
Merger Sub. Each of the complaints alleges, inter alia,
that the members of the ICG Board breached fiduciary duties owed
to ICG’s shareholders by failing to take steps to maximize
the value of ICG to its shareholders or engage in an appropriate
sales process in connection with the proposed transaction and
that Arch and Merger Sub aided and abetted the alleged breach.
Plaintiffs seek relief that includes, inter alia, an
injunction prohibiting the proposed transaction, an accounting,
and costs and disbursements of the action, including
attorneys’ fees and experts’ fees.
In addition, on May 9, 2011, two putative class action
lawsuits were filed in the Circuit Court of Putnam County, West
Virginia purportedly on behalf of a class of shareholders of
ICG, docketed as Walker v. International Coal Group,
Inc., et al., Case
No. 11-C-123
and Huerta v. International Coal Group, Inc., et
al., Case
No. 11-C-124.
On May 11, 2011, a putative class action lawsuit was filed
in the Circuit Court of Kanawha County, West Virginia
purportedly on behalf of a class of shareholders of ICG,
docketed as Goe v. International Coal Group, Inc.,
et al., Case
No. 11-C-766.
On May 13, 2011, a putative class action complaint was
filed in the Circuit Court of Putnam County, West Virginia
purportedly on behalf of a class of shareholders of ICG,
docketed as Eyster v. International Coal Group,
Inc., et. al., Case
No. 11-C-131
(collectively with the Walker, Huerta, and Goe
actions, the “West Virginia State Court
Actions”). Each of the complaints names as defendants
ICG, members of the ICG Board, and Arch. The Huerta and
Eyster complaints also name Merger Sub as a defendant.
The Goe complaint also names certain officers of ICG,
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Arch’s CEO and chairman of the board of directors, and
Merger Sub as defendants. Each of the complaints alleges,
inter alia, that ICG
and/or the
ICG directors
and/or
officers breached fiduciary duties owed to ICG’s
shareholders by failing to take steps to maximize the value of
ICG to its shareholders or engage in an appropriate sales
process in connection with the proposed transaction and that
Arch aided and abetted the alleged breach. The Huerta and
Eyster complaints also allege that ICG and Merger Sub
aided and abetted the alleged breach. The Goe complaint
additionally alleges that ICG is secondarily liable for the
alleged breach and that Merger Sub and Arch’s CEO and
chairman of the board of directors aided and abetted the alleged
breach. Plaintiffs seek relief that includes, inter alia,
an injunction prohibiting the proposed transaction, rescission,
and costs and disbursements of the action, including
attorneys’ fees and experts’ fees.
On May 12, 2011, a putative class action lawsuit was filed
in the United States District Court for the Southern District of
West Virginia purportedly on behalf of a class of shareholders
of ICG, docketed as Giles v. ICG, Inc., et al., Case
No. 3:11-0330
(the “West Virginia Federal Court Action,”
collectively with the West Virginia State Court Actions, the
“West Virginia Actions”). The complaint names
as defendants ICG, members of the ICG Board, Arch, and Merger
Sub. The complaint alleges, inter alia, that the members
of the ICG Board breached fiduciary duties owed to ICG’s
shareholders by failing to take steps to maximize the value of
ICG to its shareholders or engage in an appropriate sales
process in connection with the proposed transaction and that
ICG, Arch and Merger Sub aided and abetted the alleged breach.
Plaintiff seeks relief that includes, inter alia, an
injunction prohibiting the proposed transaction, an accounting,
and costs and disbursements of the action, including
attorneys’ fees and experts’ fees.
On May 13, 2011, defendants in the Delaware Actions and the
West Virginia Actions (collectively, the
“Actions”) filed motions in the Court of
Chancery of the State of Delaware and the United States District
Court for the Southern District of West Virginia seeking an
order that the Actions proceed in a single jurisdiction, and
postmarked the same motion to the Circuit Courts of Putnam and
Kanawha Counties, West Virginia.
State Takeover Laws. In general,
Section 203 of the DGCL prevents an “interested
stockholder” (generally, a stockholder owning 15% or more
of a corporation’s outstanding voting stock or an affiliate
or associate thereof) from engaging in a “business
combination” (defined to include a merger or consolidation
and certain other transactions) with a Delaware corporation for
a period of three years following the date such person became an
interested stockholder unless (i) prior to such time the
corporation’s board of directors approved either the
business combination or the transaction which resulted in such
stockholder becoming an interested stockholder, (ii) upon
consummation of the transaction which resulted in such
stockholder becoming an interested stockholder, the interested
stockholder owned at least 85% of the corporation’s voting
stock outstanding at the time the transaction commenced
(excluding shares owned by certain employee stock plans and
persons who are directors and also officers of the corporation)
or (iii) at or subsequent to such time the business
combination is approved by the corporation’s board of
directors and authorized at an annual or special meeting of
stockholders, and not by written consent, by the affirmative
vote of at least
662/3% of
the outstanding voting stock not owned by the interested
stockholder. The ICG Board has represented that it has approved
the Merger Agreement and the transactions contemplated by the
Merger Agreement as required to render Section 203 of the
DGCL inapplicable to the Offer and the Merger. The foregoing
description of Section 203 of the DGCL does not purport to
be complete and is qualified in its entirety by reference to the
provisions of Section 203 of the DGCL.
ICG is incorporated under the laws of the State of Delaware and
its operations are conducted throughout the United States. A
number of states have adopted laws which purport, to varying
degrees, to apply to attempts to acquire corporations that are
incorporated in, or which have substantial assets, stockholders,
principal executive offices or principal places of business or
whose business operations otherwise have substantial economic
effects in, such states. ICG, directly or through subsidiaries,
conducts business in a number of states throughout the United
States, some of which have may have enacted such laws. Except as
described herein, we do not know whether any of these laws will,
by their terms, apply to the Offer or the Merger, and we have
not complied with any such laws except as described herein. To
the extent that certain provisions of these laws purport to
apply to the Offer or the Merger, we believe there are
reasonable bases for contesting such laws.
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In 1982, in Edgar v. MITE Corp., the Supreme Court
of the United States 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. However, in 1987, in CTS Corp.
v. Dynamics Corp. of America, the Supreme Court held
that the State of Indiana could, as a matter of corporate law,
constitutionally disqualify a potential acquiror from voting
shares of a target corporation without the prior approval of the
remaining stockholders where, among other things, the
corporation is incorporated, and has a substantial number of
stockholders, in the state. Subsequently, in TLX Acquisition
Corp. v. Telex Corp., a U.S. federal district court
in Oklahoma ruled that the Oklahoma statutes were
unconstitutional as applied to corporations incorporated outside
Oklahoma in that they would subject such corporations to
inconsistent regulations. Similarly, in Tyson Foods, Inc.
v. McReynolds, a U.S. 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 U.S.
federal district court in Florida held, in Grand Metropolitan
PLC v. Butterworth, that the provisions of the
Florida Affiliated Transactions Act and the Florida Control
Share Acquisition Act were unconstitutional as applied to
corporations incorporated outside of Florida.
If any government official or third party seeks to apply any
state takeover law to the Offer or the Merger, we will take such
action as then appears desirable, which action may include
challenging the applicability or validity of such statute in
appropriate court proceedings. If it is asserted that one or
more state takeover statutes is applicable to the Offer or the
Merger and an appropriate court does not determine that it is
inapplicable or invalid as applied to the Offer or the Merger,
we may be required to file certain information with, or to
receive approvals from, the relevant state authorities or
holders of Shares, and we may be unable to accept for payment or
pay for Shares tendered pursuant to the Offer, or be delayed in
continuing or consummating the Offer or the Merger. In such
case, we may not be obligated to accept for payment or pay for
any tendered Shares. See Section 15 —
“Conditions to the Offer.”
Antitrust Compliance. Under the HSR Act and
the rules that have been promulgated thereunder, certain
acquisitions of voting securities or assets may not be
consummated unless Premerger Notification and Report Forms have
been filed with the Antitrust Division and the FTC and certain
waiting period requirements have been satisfied. The purchase of
Shares pursuant to the Offer is subject to such requirements and
may not be completed until the expiration of the waiting period,
discussed below, following the filing by Arch, as the ultimate
parent entity of the Merger Sub, of a Premerger Notification and
Report Form.
Each of Arch and ICG intend to file today a Premerger
Notification and Report Form, as described above, with the FTC
and the Antitrust Division for review in connection with the
Offer. The antitrust filing date is May 16, 2011. The
waiting period applicable to the purchase of Shares pursuant to
the Offer will expire at 11:59 p.m, New York City time, on the
15th calendar day from the time of the filing of the Arch
Notification and Report Form, or May 31, 2011, (unless
earlier terminated by the FTC and the Antitrust Division).
However, the Antitrust Division or the FTC may extend the
waiting period by requesting additional information or
documentary material relevant to the Offer from Arch. If such a
request is made, the waiting period will be extended until
11:59 p.m., New York City time, ten calendar days after
such request is complied with. Thereafter, such waiting period
can be extended only by court order or with Arch’s consent.
Although ICG is required to file certain information and
documentary material with the Antitrust Division and the FTC in
connection with the Offer, neither ICG’s failure to make
those filings nor a request for additional documents or
information issued to ICG by the Antitrust Division or the FTC
will extend the waiting period with respect to the purchase of
Shares pursuant to the Offer. If either
15-day or
ten-day
waiting period expires on a Saturday, Sunday or legal public
holiday, then the period is extended until 11:59 p.m., New
York City time, the next day that is not a Saturday, Sunday or
legal public holiday. Arch intends to make a request pursuant to
the HSR Act for early termination of the waiting period
applicable to the Offer. There can be no assurance, however,
that the
15-day HSR
Act waiting period will be terminated early.
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The Antitrust Division and the FTC routinely evaluate the
legality under the antitrust laws of transactions such as our
acquisition of Shares pursuant to the Offer. At any time before
or after the consummation of any such transactions, the
Antitrust Division or the FTC could take such action under the
antitrust laws as it deems necessary or desirable in the public
interest, such as seeking to enjoin the purchase of Shares
pursuant to the Offer or seeking divestiture of the Shares so
acquired or divestiture of some of our or ICG’s assets.
Private parties and state attorneys general may also bring legal
actions under the antitrust laws. There can be no assurance that
a challenge to the Offer on antitrust grounds will not be made
or, if such a challenge is made, what the result will be.
Morgan Stanley is acting as financial advisor to Arch and as
Dealer Manager for the Offer and the Merger. Morgan Stanley will
not be entitled to any compensation from Arch or Merger Sub for
acting as the Dealer Manager. Arch will pay Morgan Stanley a
customary fee payable upon completion of the Offer and the
Merger for its services as financial advisor. Arch has also
agreed to reimburse Morgan Stanley for its reasonable expenses
incurred in performing its services. In addition, Arch has
agreed to indemnify Morgan Stanley and its affiliates, their
respective directors, officers, agents and employees and each
person, if any, controlling Morgan Stanley or any of its
affiliates, against certain liabilities and expenses in
connection with Morgan Stanley’s engagement, including
certain liabilities under the United States federal securities
laws related to or arising out of Morgan Stanley’s
engagement. In the ordinary course of its trading, brokerage,
investment management, and financing activities, Morgan Stanley,
its successors and affiliates may actively trade securities or
loans of Arch or ICG for their own accounts and accounts of
customers, and, accordingly, may at any time hold a long or
short position in these securities or loans.
We have retained Innisfree M&A Incorporated as Information
Agent in connection with the Offer. The Information Agent may
contact holders of Shares by mail, telephone, electronic mail,
facsimile and personal interview and may request brokers,
dealers and other nominee stockholders to forward material
relating to the Offer to beneficial owners of Shares. We will
pay the Information Agent reasonable and customary compensation
for these services in addition to reimbursing the Information
Agent for its reasonable
out-of-pocket
expenses. We have agreed to indemnify the Information Agent
against certain liabilities and expenses in connection with the
Offer, including certain liabilities under the United States
federal securities laws.
In addition, we have retained Computershare Trust Company,
N.A. as the Depositary. We 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, and will indemnify the Depositary against certain
liabilities and expenses, including certain liabilities under
the United States federal securities laws.
Except as set forth above, we will not pay any fees or
commissions to any broker, dealer or other person for soliciting
tenders of Shares pursuant to the Offer. We will reimburse
brokers, dealers, commercial banks and trust companies and other
nominees, upon request, for customary clerical and mailing
expenses incurred by them in forwarding offering materials to
their customers.
We are not aware of any jurisdiction where the making of the
Offer is prohibited by any administrative or judicial action
pursuant to any valid state statute. If we become aware of any
valid state statute prohibiting the making of the Offer or the
acceptance of the Shares, we will make a good faith effort to
comply with that state statute. If, after a good faith effort,
we cannot comply with the state statute, we will not make the
Offer to, nor will we accept tenders from or on behalf of, the
holders of Shares in that 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 will be deemed to be
made on behalf of Merger Sub by the Dealer Manager or by one or
more registered brokers or dealers licensed under the laws of
such jurisdiction.
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No person has been authorized to give any information or make
any representation on behalf of Arch or Merger Sub 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. No broker, dealer, bank,
trust company, fiduciary or other person shall be deemed to be
the agent of Arch, Merger Sub, the Depositary, the Dealer
Manager or the Information Agent for the purpose of the
Offer.
We have filed with the SEC a Schedule TO, together with
exhibits, furnishing certain additional information with respect
to the Offer, and may file amendments to our Schedule TO.
In addition, ICG has filed with the SEC a
Solicitation/Recommendation Statement on
Schedule 14D-9,
together with exhibits, pursuant to
Rule 14d-9
under the Exchange Act, setting forth the recommendation of
ICG’s Board with respect to the Offer and the reasons for
such recommendation and furnishing certain additional related
information. Our Schedule TO and the
Schedule 14D-9
and any exhibits or amendments may be examined and copies may be
obtained from the SEC in the manner described in
Section 8 — “Certain Information Concerning
ICG.”
ATLAS ACQUISITION CORP.
May 16, 2011
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SCHEDULE I
DIRECTORS
AND EXECUTIVE OFFICERS OF ARCH
The name, current principal occupation or employment and
material occupations, positions, offices or employment for the
past five years of each director and executive officer of Arch
are set forth below. Unless otherwise indicated, each occupation
set forth opposite an individual’s name refers to
employment with Arch. The business address of each director and
officer is Arch Coal, Inc., One CityPlace Drive, Suite 300,
St. Louis, Missouri, 63141. All directors and executive
officers listed below are United States citizens. Directors are
identified by an asterisk. Unless otherwise indicated, the
titles referenced below refer to titles with Arch.
|
Current Principal Occupation or |
||||||
|
Name
|
Age
|
Employment and Five-Year Employment History
|
||||
|
C. Henry Besten, Jr.
|
62 | Mr. Besten has served as Senior Vice President-Strategic Development of Arch since 2002. | ||||
|
James R. Boyd*
|
64 | Mr. Boyd served as chairman of the Arch board of directors from 1998 to April 2006, when he was appointed Arch’s lead director. Mr. Boyd served as Senior Vice President and Group Operating Officer of Ashland Inc. from 1989 until his retirement in 2002. Mr. Boyd also serves on the board of directors of Halliburton Inc. | ||||
|
John T. Drexler
|
41 | Mr. Drexler has served as the Senior Vice President and Chief Financial Officer of Arch since April 2008. Mr. Drexler served as the Vice President-Finance and Accounting of Arch from March 2006 to April 2008. From March 2005 to March 2006, Mr. Drexler served as the Director of Planning and Forecasting of Arch. Prior to March 2005, Mr. Drexler held several other positions within Arch’s finance and accounting department. | ||||
|
John W. Eaves*
|
53 | Mr. Eaves has been the President and Chief Operating Officer of Arch since April 2006. From 2002 to April 2006, Mr. Eaves served as the Executive Vice President and Chief Operating Officer of Arch. Mr. Eaves also serves on the board of directors of ADA-ES, Inc. and COALOGIX. | ||||
|
Sheila B. Feldman
|
56 | Ms. Feldman has served as Vice President-Human Resources of Arch since 2003. From 1997 to 2003, Ms. Feldman was the Vice President-Human Resources and Public Affairs of Solutia Inc. | ||||
|
Governor David Freudenthal*
|
60 | Governor Freudenthal served as the Governor of Wyoming from 2003 until January 2011. Prior to his service as governor, he served as U.S. Attorney for the District of Wyoming. Governor Freudenthal current serves as an Adjunct Professor at the University of Wyoming. | ||||
|
Patricia F. Godley*
|
62 | Since 1998, Ms. Godley has been a partner with the law firm of Van Ness Feldman, practicing in the areas of economic and environmental regulation of electric utilities and natural gas companies. Ms. Godley is also a director of the United States Energy Association. | ||||
|
Douglas H. Hunt*
|
58 | Since 1995, Mr. Hunt has served as Director of Acquisitions of Petro-Hunt, LLC, a private oil and gas exploration and production company. | ||||
|
Brian J. Jennings*
|
50 | Since February 2009, Mr. Jennings has been President and Chief Executive Officer of Rise Energy Partners, L.P. From February 2007 to June 2008, Mr. Jennings served as Chief Financial Officer of Energy Transfer Partners GP, L.P., the general partner of Energy Transfer Partners, L.P., a publicly-traded partnership owning and operating intrastate and interstate natural gas pipelines. From 2004 to December 2006, Mr. Jennings served as Senior Vice President-Corporate Finance and Development and Chief Financial Officer of Devon Energy Corporation. | ||||
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|
Current Principal Occupation or |
||||||
|
Name
|
Age
|
Employment and Five-Year Employment History
|
||||
|
Robert G. Jones
|
54 | Mr. Jones has served as Senior Vice President-Law, General Counsel and Secretary of Arch since August 2008. Mr. Jones served as Vice President-Law, General Counsel and Secretary from 2000 to August 2008. | ||||
|
J. Thomas Jones*
|
61 | Mr. Jones has been Chief Executive Officer of West Virginia United Health System located in Fairmont, West Virginia since 2002. From 2000 to 2002, Mr. Jones served as Chief Executive Officer of Genesis Hospital System in Huntington, West Virginia. Mr. Jones is also a director of Premier, Inc. and Health Partners Network. | ||||
|
Paul A. Lang
|
50 | Mr. Lang has served as the Senior Vice President-Operations of Arch since December 2006. Mr. Lang served as President of Western Operations from July 2005 through December 2006 and President and General Manager of Thunder Basin Coal Company, L.L.C. from 1998 through July 2005. | ||||
|
Steven F. Leer*
|
58 | Mr. Leer has been Chief Executive Officer of Arch since 1992. From 1992 to April 2006, Mr. Leer also served as President of Arch. In April 2006, Mr. Leer became Chairman of the board of directors of Arch. Mr. Leer also serves on the boards of the Norfolk Southern Corporation, USG Corp., the Business Roundtable, the University of the Pacific, Washington University and is past chairman of the Coal Industry Advisory Board. Mr. Leer is past chairman and continues to serve on the boards of the Center for Energy and Economic Development, the National Coal Council and the National Mining Association. | ||||
|
A. Michael Perry*
|
74 | Mr. Perry served as Chairman of Bank One, West Virginia, N.A. from 1993 and as its Chief Executive Officer from 1983 until his retirement in 2001. Mr. Perry also serves on the board of directors of Champion Industries, Inc. and Portec Rail Products, Inc. | ||||
|
David B. Peugh
|
56 | Mr. Peugh has served as Vice President-Business Development of Arch since 1995. | ||||
|
Robert G. Potter*
|
71 | Mr. Potter was Chairman and Chief Executive Officer of Solutia, Inc. from 1997 until his retirement in 1999. He is also an investor in several private companies and has served as a member of the board of directors for six other companies. | ||||
|
Theodore D. Sands*
|
65 | Since 1999, Mr. Sands has served as President of HAAS Capital, LLC, a private consulting and investment company. Mr. Sands served as Managing Director, Investment Banking for the Global Metals/Mining Group of Merrill Lynch & Co. from 1982 until February 1999. Mr. Sands has also served as a member of the board of directors for several other companies. | ||||
|
Deck S. Slone
|
47 | Mr. Slone has served as Vice President-Government, Investor and Public Affairs of Arch since August 2008. Mr. Slone served as Vice President-Investor Relations and Public Affairs of Arch from 2001 to August 2008. | ||||
|
Wesley M. Taylor*
|
68 | Mr. Taylor was President of TXU Generation, a company engaged in electricity infrastructure ownership and management. Mr. Taylor served at TXU for 38 years prior to his retirement in 2004. Mr. Taylor also serves on the board of directors of FirstEnergy Corporation. | ||||
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|
Current Principal Occupation or |
||||||
|
Name
|
Age
|
Employment and Five-Year Employment History
|
||||
|
David N. Warnecke
|
55 | Mr. Warnecke has served as the Vice President-Marketing and Trading of Arch since August 2005 and was appointed Senior Vice President-Marketing and Trading in 2011. From June 2005 until March 2007, Mr. Warnecke served as President of Arch’s Arch Coal Sales Company, Inc. subsidiary, and from April 2004 until June 2005, Mr. Warnecke served as Executive Vice President of Arch Coal Sales Company, Inc. Prior to June 2004, Mr. Warnecke was Senior Vice President-Sales, Trading and Transportation of Arch Coal Sales Company, Inc. | ||||
|
Peter I. Wold*
|
63 | Mr. Wold is President and co-owner of Wold Oil Properties, Inc., an oil and gas exploration and production company. He is also Vice President of American Talc Company, a corporation that mines and processes talc in Western Texas. He presently chairs the Wyoming Enhanced Oil Recovery Commission and is a director of the Oppenheimer Funds, Inc., New York Board. Mr. Wold has also served in the Wyoming House of Representatives and as a director of the Denver Branch of the Kansas City Federal Reserve Bank. | ||||
DIRECTORS
AND EXECUTIVE OFFICERS OF MERGER SUB
The name, current principal occupation or employment and
material occupations, positions, offices or employment for the
past five years, of each director and executive officer of
Merger Sub are set forth below. Unless otherwise indicated, each
occupation set forth opposite an individual’s name refers
to employment with Merger Sub. The business address of each
director and officer is Atlas Acquisition Corp., c/o Arch Coal,
Inc., One CityPlace Drive, Suite 300, St. Louis, Missouri,
63141. All directors and executive officers listed below are
United States citizens. Directors are identified by an asterisk.
|
Current Principal Occupation or |
||||||
|
Name
|
Age |
Employment and Five-Year Employment History
|
||||
|
John W. Eaves*
|
53 | Mr. Eaves has been the President of Merger Sub since Merger Sub was formed. Mr. Eaves has been the President and Chief Operating Officer of Arch since April 2006. From 2002 to April 2006, Mr. Eaves served as the Executive Vice President and Chief Operating Officer of Arch. Mr. Eaves also serves on the board of directors of ADA-ES, Inc. and COALOGIX. | ||||
|
John T. Drexler
|
41 | Mr. Drexler has been the Vice President of Merger Sub since Merger Sub was formed. Mr. Drexler has served as the Senior Vice President and Chief Financial Officer of Arch since April 2008. Mr. Drexler served as the Vice President-Finance and Accounting of Arch from March 2006 to April 2008. From March 2005 to March 2006, Mr. Drexler served as the Director of Planning and Forecasting of Arch. Prior to March 2005, Mr. Drexler held several other positions within Arch’s finance and accounting department. | ||||
|
James E. Florczak
|
60 | Mr. Florczak has been the Vice President & Treasurer of Merger Sub since Merger Sub was formed. Mr. Florczak has served as Treasurer of Arch for the past five years. | ||||
|
Robert G. Jones*
|
54 | Mr. Jones has served as Senior Vice President-Law, General Counsel and Secretary of Arch since August 2008. Mr. Jones served as Vice President-Law, General Counsel and Secretary from 2000 to August 2008. | ||||
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|
Current Principal Occupation or |
||||||
|
Name
|
Age |
Employment and Five-Year Employment History
|
||||
|
Steven F. Leer*
|
58 | Mr. Leer has been Chief Executive Officer of Arch since 1992. From 1992 to April 2006, Mr. Leer also served as President of Arch. In April 2006, Mr. Leer became Chairman of the board of directors of Arch. Mr. Leer also serves on the boards of the Norfolk Southern Corporation, USG Corp., the Business Roundtable, the University of the Pacific, Washington University and is past chairman of the Coal Industry Advisory Board. Mr. Leer is past chairman and continues to serve on the boards of the Center for Energy and Economic Development, the National Coal Council and the National Mining Association. | ||||
|
Jon S. Ploetz
|
38 | Mr. Ploetz has been Secretary of Merger Sub since Merger Sub was formed. Mr. Ploetz has served as Assistant General Counsel & Assistant Secretary of Arch since February 2010. Prior joining Arch, Mr. Ploetz was an attorney with Patton Boggs LLP from November 2004 until February 2010. | ||||
|
C. David Steele
|
55 | Mr. Steele has been Vice President — Tax of Merger Sub since Merger Sub was formed. Mr. Steele has served as Vice President — Taxes of Arch since May 2003. Mr. Steele is a CPA and has a BS- Business Administration and a MBA. | ||||
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Table of Contents
Facsimile copies of the Letter of Transmittal will be accepted.
The Letter of Transmittal and certificates for Shares and any
other required documents should be sent to the Depositary at one
of the addresses set forth below:
The Depositary for the Offer is:
|
By Mail: Computershare Trust Company, N.A. Attn: Corporate Actions Voluntary Offer P.O. Box 43011 Providence, RI 02940-3011 |
By Overnight Courier: Computershare Trust Company, N.A. Attn: Corporate Actions Voluntary Offer 250 Royall Street Suite V Canton, MA 02021 |
By Facsimile:
(For Eligible Institutions Only)
(617) 360-6810
Confirm Facsimile Transmission:
(781) 575-2332
If you have questions or need additional copies of this Offer to
Purchase and the Letter of Transmittal, you can contact the
Information Agent at its address and telephone numbers set forth
below. You may also contact y our broker, dealer, bank, trust
company or other nominee for assistance concerning the Offer.
The Information Agent for the Offer is:
Innisfree M&A Incorporated
501 Madison Avenue, 20th Floor
New York, NY 10022
Stockholders may call toll free
(877) 717-3922
Banks and brokers may call collect
(212) 750-5833
The Dealer Manager for the Offer is:
Morgan Stanley & Co. Incorporated
1585 Broadway
New York, NY 10036
(Call) Toll Free: 1-855-483-0952
